10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED August 31, 2015

OR

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE TRANSITION PERIOD FROM                      TO                     

Commission File Number: 1-15829

FEDEX CORPORATION

(Exact name of registrant as specified in its charter)

Delaware	62-1721435
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
942 South Shady Grove Road Memphis, Tennessee	38120
(Address of principal executive offices)	(ZIP Code)

(901) 818-7500

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer x	Accelerated filer ¨	Non-accelerated filer ¨	Smaller reporting company ¨
	(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Common Stock	Outstanding Shares at September 16, 2015
Common Stock, par value $0.10 per share	282,379,446

FEDEX CORPORATION

INDEX

	PAGE
PART I. FINANCIAL INFORMATION
ITEM 1. Financial Statements
Condensed Consolidated Balance Sheets August  31, 2015 and May 31, 2015		3
Condensed Consolidated Statements of Income Three Months Ended August 31, 2015 and 2014		5
Condensed Consolidated Statements of Comprehensive Income Three Months Ended August 31, 2015 and 2014		6
Condensed Consolidated Statements of Cash Flows Three Months Ended August 31, 2015 and 2014		7
Notes to Condensed Consolidated Financial Statements		8
Report of Independent Registered Public Accounting Firm		25
ITEM 2. Management’s Discussion and Analysis of Results of Operations and Financial Condition		26
ITEM 3. Quantitative and Qualitative Disclosures About Market Risk		49
ITEM 4. Controls and Procedures		49
PART II. OTHER INFORMATION
ITEM 1. Legal Proceedings		50
ITEM 1A. Risk Factors		50
ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds		50
ITEM 6. Exhibits		50
Signature		52
Exhibit Index		E-1
Exhibit 2.1
Exhibit 10.1
Exhibit 10.2
Exhibit 10.3
Exhibit 10.4
Exhibit 10.5
Exhibit 10.6
Exhibit 12.1
Exhibit 15.1
Exhibit 31.1
Exhibit 31.2
Exhibit 32.1
Exhibit 32.2
EX-101 Instance Document
EX-101 Schema Document
EX-101 Calculation Linkbase Document
EX-101 Presentation Linkbase Document
EX-101 Definition Linkbase Document

- 2 -

FEDEX CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(IN MILLIONS)

	August 31,
	2015		May 31,
	(Unaudited)		2015
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	3,543	$	3,763
Receivables, less allowances of $190 and $185		5,617		5,719
Spare parts, supplies and fuel, less allowances of $214 and $207		488		498
Deferred income taxes		606		606
Prepaid expenses and other		449		355
Total current assets		10,703		10,941
PROPERTY AND EQUIPMENT, AT COST		43,989		42,864
Less accumulated depreciation and amortization		22,506		21,989
Net property and equipment		21,483		20,875
OTHER LONG-TERM ASSETS
Goodwill		3,792		3,810
Other assets		1,267		1,443
Total other long-term assets		5,059		5,253
	$	37,245	$	37,069

The accompanying notes are an integral part of these condensed consolidated financial statements.

- 3 -

FEDEX CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(IN MILLIONS, EXCEPT SHARE DATA)

	August 31,
	2015			May 31,
	(Unaudited)			2015
LIABILITIES AND STOCKHOLDERS’ INVESTMENT
CURRENT LIABILITIES
Current portion of long-term debt	$	14		$	19
Accrued salaries and employee benefits		1,355			1,436
Accounts payable		2,049			2,066
Accrued expenses		2,426			2,436
Total current liabilities		5,844			5,957
LONG-TERM DEBT, LESS CURRENT PORTION		7,244			7,249
OTHER LONG-TERM LIABILITIES
Deferred income taxes		1,781			1,747
Pension, postretirement healthcare and other benefit obligations		4,806			4,893
Self-insurance accruals		1,186			1,120
Deferred lease obligations		766			711
Deferred gains, principally related to aircraft transactions		174			181
Other liabilities		161			218
Total other long-term liabilities		8,874			8,870
COMMITMENTS AND CONTINGENCIES
COMMON STOCKHOLDERS’ INVESTMENT
Common stock, $0.10 par value; 800 million shares authorized; 318 million shares issued as of August 31, 2015 and May 31, 2015		32			32
Additional paid-in capital		2,814			2,786
Retained earnings		17,434			16,900
Accumulated other comprehensive income		10			172
Treasury stock, at cost		(5,007	)		(4,897	)
Total common stockholders’ investment		15,283			14,993
	$	37,245		$	37,069

The accompanying notes are an integral part of these condensed consolidated financial statements.

- 4 -

FEDEX CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(UNAUDITED)

(IN MILLIONS, EXCEPT PER SHARE AMOUNTS)

	Three Months Ended August 31,
	2015			2014
REVENUES	$	12,279		$	11,684
OPERATING EXPENSES:
Salaries and employee benefits		4,525			4,114
Purchased transportation		2,344			2,054
Rentals and landing fees		695			660
Depreciation and amortization		648			651
Fuel		712			1,120
Maintenance and repairs		548			556
Other		1,663			1,467
		11,135			10,622
OPERATING INCOME		1,144			1,062
OTHER INCOME (EXPENSE):
Interest, net		(63	)		(48	)
Other, net		3			(2	)
		(60	)		(50	)
INCOME BEFORE INCOME TAXES		1,084			1,012
PROVISION FOR INCOME TAXES		392			359
NET INCOME	$	692		$	653
EARNINGS PER COMMON SHARE:
Basic	$	2.45		$	2.29
Diluted	$	2.42		$	2.26
DIVIDENDS DECLARED PER COMMON SHARE	$	0.50		$	0.40

The accompanying notes are an integral part of these condensed consolidated financial statements.

- 5 -

FEDEX CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(UNAUDITED)

(IN MILLIONS)

	Three Months Ended August 31,
	2015			2014
NET INCOME	$	692		$	653
OTHER COMPREHENSIVE INCOME (LOSS):
Foreign currency translation adjustments, net of tax of $13 in 2015 and $9 in 2014		(138	)		(31	)
Amortization of prior service credit, net of tax of $7 in 2015 and $10 in 2014		(24	)		(16	)
		(162	)		(47	)
COMPREHENSIVE INCOME	$	530		$	606

The accompanying notes are an integral part of these condensed consolidated financial statements.

- 6 -

FEDEX CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

(IN MILLIONS)

	Three Months Ended August 31,
	2015			2014
Operating Activities:
Net income	$	692		$	653
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation and amortization		648			651
Provision for uncollectible accounts		28			35
Stock-based compensation		53			48
Deferred income taxes and other noncash items		20			(22	)
Changes in assets and liabilities:
Receivables		50			(86	)
Other assets		(89	)		(30	)
Accounts payable and other liabilities		(151	)		(257	)
Other, net		(10	)		(10	)
Cash provided by operating activities		1,241			982
Investing Activities:
Capital expenditures		(1,209	)		(720	)
Proceeds from asset dispositions and other		10			4
Cash used in investing activities		(1,199	)		(716	)
Financing Activities:
Principal payments on debt		(15	)		—
Proceeds from stock issuances		46			97
Excess tax benefit on the exercise of stock options		6			10
Dividends paid		(71	)		(57	)
Purchase of treasury stock		(190	)		(791	)
Cash used in financing activities		(224	)		(741	)
Effect of exchange rate changes on cash		(38	)		(17	)
Net decrease in cash and cash equivalents		(220	)		(492	)
Cash and cash equivalents at beginning of period		3,763			2,908
Cash and cash equivalents at end of period	$	3,543		$	2,416

The accompanying notes are an integral part of these condensed consolidated financial statements.

- 7 -

FEDEX CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

(1) General

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES. These interim financial statements of FedEx Corporation (“FedEx”) have been prepared in accordance with accounting principles generally accepted in the United States and Securities and Exchange Commission (“SEC”) instructions for interim financial information, and should be read in conjunction with our Annual Report on Form 10-K for the year ended May 31, 2015 (“Annual Report”). Accordingly, significant accounting policies and other disclosures normally provided have been omitted since such items are disclosed in our Annual Report.

In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments (including normal recurring adjustments) necessary to present fairly our financial position as of August 31, 2015, and the results of our operations and cash flows for the three-month periods ended August 31, 2015 and 2014. Operating results for the three-month period ended August 31, 2015 are not necessarily indicative of the results that may be expected for the year ending May 31, 2016.

Except as otherwise specified, references to years indicate our fiscal year ending May 31, 2016 or ended May 31 of the year referenced and comparisons are to the corresponding period of the prior year.

REVENUE RECOGNITION. On June 1, 2015, we began recording revenues associated with the FedEx SmartPost service on a gross basis including postal fees in revenues and expenses, versus our previous net treatment, due to operational changes occurring in 2016 which result in us being the principal in all cases for the FedEx SmartPost service. This change has been recognized prospectively.

BUSINESS ACQUISITIONS. As discussed in our Annual Report, on April 6, 2015, we entered into a conditional agreement to acquire TNT Express N.V. (“TNT Express”) for €4.4 billion (currently, approximately $5.0 billion). This combination is expected to expand our global portfolio, particularly in Europe, lower our costs to serve our European markets by increasing density in our pickup-and-delivery operations and accelerate our global growth. This acquisition is expected to be completed in the first half of calendar year 2016. The closing of the acquisition is subject to customary conditions, including obtaining all necessary approvals and competition clearances. We expect to secure all relevant competition approvals.

As discussed in our Annual Report, we completed our acquisitions of GENCO Distribution System, Inc. (“GENCO”) and Bongo International, LLC (“Bongo”) in the third quarter of 2015 and have included the financial results and estimated fair values of the assets and liabilities related to these acquisitions in the FedEx Ground and FedEx Express segments, respectively. These acquisitions are included in the accompanying balance sheets based on a preliminary allocation of the purchase price (summarized in the table below, in millions) which reflects immaterial updates from the May 31, 2015 estimate.

Current assets	$	350
Property and equipment		113
Goodwill		1,170
Intangible assets		139
Other non-current assets		25
Current liabilities		(245	)
Long-term liabilities		(97	)
Total purchase price	$	1,455

- 8 -

The goodwill recorded is primarily attributable to expected benefits from synergies of the combinations with existing businesses and other acquired entities and the work force in place at GENCO. The majority of the purchase price allocated to goodwill is not deductible for U.S. income tax purposes. The intangible assets acquired consist primarily of customer-related intangible assets, which are amortized on an accelerated basis over an estimated life of 15 years.

EMPLOYEES UNDER COLLECTIVE BARGAINING ARRANGEMENTS. The pilots of FedEx Express, which represent a small number of FedEx Express’s total employees, are employed under a collective bargaining agreement. The contract became amendable in March 2013. After participating in negotiations assisted by the National Mediation Board (“NMB”), the parties reached a Tentative Agreement (“TA”) on August 19, 2015. The TA is currently out for a membership ratification vote which will close in mid-October. If the TA is ratified, it will become effective November 2, 2015 and will become amendable in November 2021. If the TA is not ratified, the parties will reenter NMB mediated negotiations. The NMB is the U.S. governmental agency that oversees labor agreements for entities covered by the Railway Labor Act of 1926, as amended. In addition to our pilots at FedEx Express, GENCO has a small number of employees who are members of unions, and certain non-U.S. employees are unionized.

STOCK-BASED COMPENSATION. We have two types of equity-based compensation: stock options and restricted stock. The key terms of the stock option and restricted stock awards granted under our incentive stock plans and all financial disclosures about these programs are set forth in our Annual Report.

Our stock-based compensation expense was $53 million for the three-month period ended August 31, 2015 and $48 million for the three-month period ended August 31, 2014. Due to its immateriality, additional disclosures related to stock-based compensation have been excluded from this quarterly report.

RECENT ACCOUNTING GUIDANCE. New accounting rules and disclosure requirements can significantly impact our reported results and the comparability of our financial statements. These matters are described in our Annual Report.

We believe that no other new accounting guidance was adopted or issued during the first three months of 2016 that is relevant to the readers of our financial statements. However, there are numerous new proposals under development which, if and when enacted, may have a significant impact on our financial reporting.

TREASURY SHARES. In September 2014, our Board of Directors authorized the repurchase of up to 15 million shares of common stock. During the first quarter of 2016, we repurchased 1.1 million shares of FedEx common stock at an average price of $172 per share for a total of $190 million. As of August 31, 2015, 11.1 million shares remained under the share repurchase authorization. This authorization may be utilized to offset equity compensation dilution and for opportunistic repurchases based on market conditions and other factors. The timing and volume of repurchases are at the discretion of FedEx management.

DIVIDENDS DECLARED PER COMMON SHARE. On August 14, 2015, our Board of Directors declared a quarterly dividend of $0.25 per share of common stock. The dividend will be paid on October 1, 2015 to stockholders of record as of the close of business on September 10, 2015. Each quarterly dividend payment is subject to review and approval by our Board of Directors, and we evaluate our dividend payment amount on an annual basis at the end of each fiscal year.

- 9 -

(2) Accumulated Other Comprehensive Income

The following table provides changes in accumulated other comprehensive income (“AOCI”), net of tax, reported in our unaudited condensed consolidated financial statements for the three-month periods ended August 31 (in millions; amounts in parentheses indicate debits to AOCI):

	2015			2014
Foreign currency translation gain (loss):
Balance at beginning of period	$	(253	)	$	81
Translation adjustments		(138	)		(31	)
Balance at end of period		(391	)		50
Retirement plans adjustments:
Balance at beginning of period		425			425
Reclassifications from AOCI		(24	)		(16	)
Balance at end of period		401			409
Accumulated other comprehensive income at end of period	$	10		$	459

The following table presents details of the reclassifications from AOCI for the three-month periods ended August 31 (in millions; amounts in parentheses indicate debits to earnings):

	Amount Reclassified from AOCI						Affected Line Item in the Income Statement
	2015			2014
Amortization of retirement plans prior service credits, before tax	$	31		$	26		Salaries and employee benefits
Income tax benefit		(7	)		(10	)	Provision for income taxes
AOCI reclassifications, net of tax	$	24		$	16		Net income

(3) Financing Arrangements

In September 2015, we expect to file a new shelf registration statement with the SEC that will allow us to sell, in one or more future offerings, any combination of our unsecured debt securities and common stock.

A $1 billion revolving credit facility is available to finance our operations and other cash flow needs and to provide support for the issuance of commercial paper. The revolving credit agreement expires in March 2018. The agreement contains a financial covenant, which requires us to maintain a leverage ratio of adjusted debt (long-term debt, including the current portion of such debt, plus six times our last four fiscal quarters’ rentals and landing fees) to capital (adjusted debt plus total common stockholders’ investment) that does not exceed 70%. Our leverage ratio of adjusted debt to capital was 61% at August 31, 2015. We believe the leverage ratio covenant is our only significant restrictive covenant in our revolving credit agreement. Our revolving credit agreement contains other customary covenants that do not, individually or in the aggregate, materially restrict the conduct of our business. We are in compliance with the leverage ratio covenant and all other covenants of our revolving credit agreement and do not expect the covenants to affect our operations, including our liquidity or expected funding needs. As of August 31, 2015, no commercial paper was outstanding, and the entire $1 billion under the revolving credit facility was available for future borrowings.

- 10 -

Long-term debt, exclusive of capital leases, had a carrying value of $7.2 billion at August 31, 2015 and May 31, 2015, compared with estimated fair values of $7.2 billion at August 31, 2015 and $7.4 billion at May 31, 2015. The estimated fair values were determined based on quoted market prices and the current rates offered for debt with similar terms and maturities. The fair value of our long-term debt is classified as Level 2 within the fair value hierarchy. This classification is defined as a fair value determined using market-based inputs other than quoted prices that are observable for the liability, either directly or indirectly.

(4) Computation of Earnings Per Share

The calculation of basic and diluted earnings per common share for the three-month periods ended August 31 was as follows (in millions, except per share amounts):

	2015		2014
Basic earnings per common share:
Net earnings allocable to common shares(1)	$	691	$	653
Weighted-average common shares		282		285
Basic earnings per common share	$	2.45	$	2.29
Diluted earnings per common share:
Net earnings allocable to common shares(1)	$	691	$	653
Weighted-average common shares		282		285
Dilutive effect of share-based awards		4		4
Weighted-average diluted shares		286		289
Diluted earnings per common share	$	2.42	$	2.26
Anti-dilutive options excluded from diluted earnings per common share		3.5		2.1

⁽¹⁾  Net earnings available to participating securities were immaterial in all periods presented.

(5) Retirement Plans

We sponsor programs that provide retirement benefits to most of our employees. These programs include defined benefit pension plans, defined contribution plans and postretirement healthcare plans. Key terms of our retirement plans are provided in our Annual Report. Our retirement plans costs for the three-month periods ended August 31 were as follows (in millions):

	2015		2014
Defined benefit pension plans	$	53	$	(7	)
Defined contribution plans		102		94
Postretirement healthcare plans		21		20
	$	176	$	107

- 11 -

Net periodic benefit cost of the pension and postretirement healthcare plans for the three-month periods ended August 31 included the following components (in millions):

	Pension Plans						Postretirement Healthcare Plans
	2015			2014			2015		2014
Service cost	$	166		$	164		$	10	$	10
Interest cost		295			275			11		10
Expected return on plan assets		(377	)		(420	)		—		—
Amortization of prior service credit		(31	)		(26	)		—		—
	$	53		$	(7	)	$	21	$	20

Contributions to our tax qualified U.S. domestic pension plans (“U.S. Pension Plans”) for the three-month periods ended August 31 were as follows (in millions):

	2015		2014
Required	$	6	$	82
Voluntary		159		83
	$	165	$	165

In September 2015, we made an additional required contribution of $165 million to our U.S. Pension Plans. Our U.S. Pension Plans have ample funds to meet expected benefit payments.

- 12 -

(6) Business Segment Information

We provide a broad portfolio of transportation, e-commerce and business services through companies competing collectively, operating independently and managed collaboratively under the respected FedEx brand. Our primary operating companies include FedEx Express, the world’s largest express transportation company; FedEx Ground Package System, Inc. (“FedEx Ground”), a leading North American provider of small-package ground delivery services; and FedEx Freight, Inc. (“FedEx Freight”), a leading U.S. provider of less-than-truckload (“LTL”) freight services.

Our reportable segments include the following businesses:

FedEx Express Segment	FedEx Express (express transportation)
	FedEx Trade Networks (air and ocean freight forwarding and customs brokerage)
	FedEx SupplyChain Systems (logistics services)
	Bongo (cross-border enablement technology and solutions)
FedEx Ground Segment	FedEx Ground (small-package ground delivery)
	GENCO (third-party logistics)
FedEx Freight Segment	FedEx Freight (LTL freight transportation)
	FedEx Custom Critical (time-critical transportation)
FedEx Services Segment	FedEx Services (sales, marketing, information technology, communications and back-office functions)
	FedEx TechConnect (customer service, technical support, billings and collections)
	FedEx Office (document and business services and package acceptance)

FedEx Services Segment

The FedEx Services segment operates combined sales, marketing, administrative and information technology functions in shared services operations that support our transportation businesses and allow us to obtain synergies from the combination of these functions. For the international regions of FedEx Express, some of these functions are performed on a regional basis by FedEx Express and reported in the FedEx Express segment in their natural expense line items.

The FedEx Services segment provides direct and indirect support to our transportation businesses, and we allocate all of the net operating costs of the FedEx Services segment (including the net operating results of FedEx Office) to reflect the full cost of operating our transportation businesses in the results of those segments. Within the FedEx Services segment allocation, the net operating results of FedEx Office, which are an immaterial component of our allocations, are allocated to FedEx Express and FedEx Ground. We review and evaluate the performance of our transportation segments based on operating income (inclusive of FedEx Services segment allocations). For the FedEx Services segment, performance is evaluated based on the impact of its total allocated net operating costs on our transportation segments.

Operating expenses for each of our transportation segments include the allocations from the FedEx Services segment to the respective transportation segments. These allocations also include charges and credits for administrative services provided between operating companies. The allocations of net operating costs are based on metrics such as relative revenues or estimated services provided. We believe these allocations approximate the net cost of providing these functions. Our allocation methodologies are refined periodically, as necessary, to reflect changes in our businesses.

- 13 -

Eliminations, Corporate and Other

Certain FedEx operating companies provide transportation and related services for other FedEx companies outside their reportable segment. Billings for such services are based on negotiated rates, which we believe approximate fair value, and are reflected as revenues of the billing segment. These rates are adjusted from time to time based on market conditions. Such intersegment revenues and expenses are eliminated in our consolidated results and are not separately identified in the following segment information, because the amounts are not material.

Corporate and other includes corporate headquarters costs for executive officers, certain other legal and financial functions, as well as certain other costs and credits not attributed to our core business. These costs are not allocated to the business segments.

The following table provides a reconciliation of reportable segment revenues and operating income to our unaudited condensed consolidated financial statement totals for the three-month periods ended August 31 (in millions):

	2015			2014
Revenues
FedEx Express segment	$	6,591		$	6,862
FedEx Ground segment		3,830			2,960
FedEx Freight segment		1,601			1,609
FedEx Services segment		390			374
Eliminations and other		(133	)		(121	)
	$	12,279		$	11,684
Operating Income
FedEx Express segment	$	545		$	377
FedEx Ground segment		537			545
FedEx Freight segment		132			168
Eliminations, corporate and other		(70	)		(28	)
	$	1,144		$	1,062

(7) Commitments

As of August 31, 2015, our purchase commitments under various contracts for the remainder of 2016 and annually thereafter were as follows (in millions):

	Aircraft and Aircraft-Related		Other(1)		Total
2016 (remainder)	$	657	$	815	$	1,472
2017		1,240		264		1,504
2018		1,739		149		1,888
2019		1,584		71		1,655
2020		1,638		23		1,661
Thereafter		5,962		98		6,060
Total	$	12,820	$	1,420	$	14,240

⁽¹⁾ Primarily equipment, advertising contracts and, for the remainder of 2016, $495 million of estimated required quarterly contributions to our U.S. Pension Plans.

- 14 -

The amounts reflected in the table above for purchase commitments represent noncancelable agreements to purchase goods or services. As of August 31, 2015, our obligation to purchase six Boeing 767-300 Freighter (“B767F”) aircraft and nine Boeing 777 Freighter (“B777F”) aircraft is conditioned upon there being no event that causes FedEx Express or its employees not to be covered by the Railway Labor Act of 1926, as amended. Open purchase orders that are cancelable are not considered unconditional purchase obligations for financial reporting purposes and are not included in the table above.

On July 21, 2015, FedEx Express entered into a supplemental agreement to purchase 50 additional B767F aircraft from Boeing. Four of the 50 additional B767F aircraft purchases are conditioned upon there being no event that causes FedEx Express or its employees not to be covered by the Railway Labor Act of 1926, as amended. The 50 additional B767F aircraft are expected to be delivered from fiscal 2018 through fiscal 2023 and will enable FedEx Express to continue to improve the efficiency and reliability of its aircraft fleet.

We had $411 million in deposits and progress payments as of August 31, 2015 on aircraft purchases and other planned aircraft-related transactions. These deposits are classified in the “Other assets” caption of our consolidated balance sheets. Aircraft and aircraft-related contracts are subject to price escalations. The following table is a summary of the key aircraft we are committed to purchase as of August 31, 2015 with the year of expected delivery:

	B767F		B777F		Total
2016 (remainder)		6		1		7
2017		12		—		12
2018		16		2		18
2019		13		2		15
2020		12		3		15
Thereafter		26		9		35
Total		85		17		102

A summary of future minimum lease payments under noncancelable operating leases with an initial or remaining term in excess of one year at August 31, 2015 is as follows (in millions):

	Operating Leases
	Aircraft and Related Equipment		Facilities and Other		Total Operating Leases
2016 (remainder)	$	430	$	1,256	$	1,686
2017		403		1,890		2,293
2018		332		1,472		1,804
2019		274		1,286		1,560
2020		190		1,126		1,316
Thereafter		360		7,354		7,714
Total	$	1,989	$	14,384	$	16,373

Future minimum lease payments under capital leases were immaterial at August 31, 2015. While certain of our lease agreements contain covenants governing the use of the leased assets or require us to maintain certain levels of insurance, none of our lease agreements include material financial covenants or limitations.

- 15 -

(8) Contingencies

Wage-and-Hour. We are a defendant in a number of lawsuits containing various class-action allegations of wage-and-hour violations. The plaintiffs in these lawsuits allege, among other things, that they were forced to work “off the clock,” were not paid overtime or were not provided work breaks or other benefits. The complaints generally seek unspecified monetary damages, injunctive relief, or both. We do not believe that a material loss is reasonably possible with respect to any of these matters.

Independent Contractor — Lawsuits and State Administrative Proceedings. FedEx Ground is involved in numerous class-action lawsuits (including 25 that have been certified as class actions), individual lawsuits and state tax and other administrative proceedings that claim that the company’s owner-operators should be treated as employees, rather than independent contractors.

Most of the class-action lawsuits were consolidated for administration of the pre-trial proceedings by a single federal court, the U.S. District Court for the Northern District of Indiana. The multidistrict litigation court granted class certification in 28 cases and denied it in 14 cases. On December 13, 2010, the court entered an opinion and order addressing all outstanding motions for summary judgment on the status of the owner-operators (i.e., independent contractor vs. employee). In sum, the court ruled on our summary judgment motions and entered judgment in favor of FedEx Ground on all claims in 20 of the 28 multidistrict litigation cases that had been certified as class actions, finding that the owner-operators in those cases were contractors as a matter of the law of 20 states. The plaintiffs filed notices of appeal in all of these 20 cases. The Seventh Circuit heard the appeal in the Kansas case in January 2012 and, in July 2012, issued an opinion that did not make a determination with respect to the correctness of the district court’s decision and, instead, certified two questions to the Kansas Supreme Court related to the classification of the plaintiffs as independent contractors under the Kansas Wage Payment Act. The other 19 cases that are before the Seventh Circuit were stayed pending a decision of the Kansas Supreme Court.

On October 3, 2014, the Kansas Supreme Court determined that a 20 factor right to control test applies to claims under the Kansas Wage Payment Act and concluded that under that test, the class members were employees, not independent contractors. The case was subsequently transferred back to the Seventh Circuit, where both parties made filings requesting the action necessary to complete the resolution of the appeals. The parties also made recommendations to the court regarding next steps for the other 19 cases that are before the Seventh Circuit. FedEx Ground requested that each of those cases be separately briefed given the potential differences in the applicable state law from that in Kansas. During the second quarter of 2015, we established an accrual for the estimated probable loss in the Kansas case that was required to be recognized pursuant to applicable accounting standards. This amount was immaterial.

On July 8, 2015, the Seventh Circuit issued an order and opinion confirming the decision of the Kansas Supreme Court, concluding that the class members are employees, not independent contractors. Additionally, the Seventh Circuit referred the other 19 cases to a representative of the court for purposes of setting a case management conference to address briefing and argument for those cases.

The multidistrict litigation court remanded the other eight certified class actions back to the district courts where they were originally filed because its summary judgment ruling did not completely dispose of all of the claims in those lawsuits. Three of these matters settled for immaterial amounts and have received court approval. One of the cases is currently pending in the Eastern District of Arkansas. Another case was appealed to the Eleventh Circuit Court of Appeals where the court reversed the class-wide summary judgment decision on May 28, 2015 and remanded the case for trial, holding that there are disputed issues of fact as to whether the class members are employees or independent contractors. Two cases in Oregon and one in California were appealed to the Ninth Circuit Court of Appeals, where the court reversed the district court decisions and held that the plaintiffs in California and Oregon were employees as a matter of law and remanded the cases to their respective district courts for further proceedings. In the first quarter of 2015, we recognized an accrual for the then-estimated probable loss in those cases that was required to be recognized pursuant to applicable accounting standards. This amount was immaterial.

- 16 -

In June 2015, the parties in the California case engaged in mediation and reached an agreement to settle the matter for $228 million, and in the fourth quarter of 2015 we increased the accrual to that amount. The settlement agreement is pending court approval.

In the Oregon cases, material exposure above the accrued amount is reasonably possible. We continue to evaluate what facts may arise in the course of discovery and what legal rulings the courts may render and how these facts and rulings might impact FedEx Ground’s loss. For a number of reasons, we are not currently able to estimate a range of reasonably possible loss in excess of the amount accrued. The number and identities of plaintiffs in these lawsuits are uncertain, as they are dependent on how the class of full-time drivers is defined and how many individuals will qualify based on whatever criteria may be established. In addition, the parties have conducted only very limited discovery into damages, which could vary considerably from plaintiff to plaintiff and be dependent on evidence pertaining to individual plaintiffs, which has yet to be produced in the cases. Further, the range of potential loss could be impacted substantially by future rulings by the court, including on the merits of the claims, on FedEx Ground’s defenses, and on evidentiary issues.

With respect to the matters that are pending outside of Oregon, it is reasonably possible that potential loss in some of these lawsuits or changes to the independent contractor status of FedEx Ground’s owner-operators could be material. Similar to our analysis of loss contingency in the Oregon cases, we continue to evaluate what facts may arise in the course of discovery and what legal rulings the courts may render and how these facts and rulings might impact FedEx Ground’s loss. As a consequence of many of the same factors described above, as well as others that are specific to these cases, we are not currently able to estimate a range of reasonably possible loss. We do not believe that a material loss is probable in these matters.

In addition, we are defending contractor-model cases that are not or are no longer part of the multidistrict litigation. These cases are in varying stages of litigation, and we do not expect to incur a material loss in any of these matters.

Adverse determinations in matters related to FedEx Ground’s independent contractors, could, among other things, entitle certain of our owner-operators and their drivers to the reimbursement of certain expenses and to the benefit of wage-and-hour laws and result in employment and withholding tax and benefit liability for FedEx Ground, and could result in changes to the independent contractor status of FedEx Ground’s owner-operators in certain jurisdictions. We believe that FedEx Ground’s owner-operators are properly classified as independent contractors and that FedEx Ground is not an employer of the drivers of the company’s independent contractors.

City and State of New York Cigarette Suit. On December 30, 2013, the City of New York filed suit against FedEx Express and FedEx Ground arising from our alleged shipments of cigarettes to New York City residents. The claims against FedEx Express were subsequently dismissed. On March 30, 2014, the complaint was amended adding the State of New York as a plaintiff. Beyond the addition of the State as a plaintiff, the amended complaint contains several amplifications of the previous claims. First, the claims now relate to four shippers, none of which continues to ship in our network. Second, the amended complaint contains a count for violation of the Assurance of Compliance (“AOC”) we had previously entered into with the State of New York, claiming that since 2006, FedEx has made shipments of cigarettes to residences in New York in violation of the AOC. Lastly, the amendment contains new theories of Racketeer Influenced and Corrupt Organizations Act (“RICO”) violations. In May 2014, we filed a motion to dismiss almost all of the claims. On November 12, 2014, the City and State of New York filed a separate but almost identical lawsuit that includes two additional shippers. This complaint was amended in May 2015 to include additional shippers. On March 9, 2015, the court ruled on our motion to dismiss in the first case, granting our motions to limit the applicable statute of limitations to four years and to dismiss a portion of the claims. The court, however, denied our motion to dismiss some of the claims, including the RICO claims. Loss in these lawsuits is reasonably possible, but the amount of any loss is expected to be immaterial.

Environmental Matters. SEC regulations require disclosure of certain environmental matters when a governmental authority is a party to the proceedings and the proceedings involve potential monetary sanctions that management reasonably believes could exceed $100,000.

- 17 -

In February 2014, FedEx Ground received oral communications from District Attorneys’ Offices (representing California’s county environmental authorities) and the California Attorney General’s Office (representing the California Division of Toxic Substances Control (“DTSC”)) that they were seeking civil penalties for alleged violations of the state’s hazardous waste regulations. Specifically, the California environmental authorities alleged that FedEx Ground improperly generates and/or handles, stores and transports hazardous waste from its stations to its hubs in California. In April 2014, FedEx Ground filed a declaratory judgment action in the United States District Court for the Eastern District of California against the Director of the California DTSC and the County District Attorneys with whom we have been negotiating. In June 2014, the California Attorney General filed a complaint against FedEx Ground in Sacramento County Superior Court alleging violations by FedEx Ground as described above. The County District Attorneys filed a similar complaint in Sacramento County Superior Court in July 2014. The county and state authorities filed a motion to dismiss FedEx Ground’s declaratory judgment action, and their motion was granted on January 22, 2015. FedEx Ground filed a notice of appeal with the Ninth Circuit Court of Appeals on February 23, 2015. FedEx Ground and the County District Attorneys reached an agreement to resolve all claims between them, and on August 10, 2015, they filed a negotiated final judgment in Sacramento County Superior Court. In the fourth quarter of 2015, we established an accrual for the final judgment amount, which was immaterial. Loss is reasonably possible as to the action commenced by the DTSC; however, the amount of any loss is expected to be immaterial.

On January 14, 2014, the U.S. Department of Justice (“DOJ”) issued a Grand Jury Subpoena to FedEx Express relating to an asbestos matter previously investigated by the U.S. Environmental Protection Agency. On May 1, 2014, the DOJ informed us that it had determined to continue to pursue the matter as a criminal case, citing seven asbestos-related regulatory violations associated with removal of roof materials from a hangar in Puerto Rico during cleaning and repair activity, as well as violation of waste disposal requirements. Loss is reasonably possible; however, the amount of any loss is expected to be immaterial.

Department of Justice Indictment – Internet Pharmacy Shipments. In the past, we received requests for information from the DOJ in the Northern District of California in connection with a criminal investigation relating to the transportation of packages for online pharmacies that may have shipped pharmaceuticals in violation of federal law. In July 2014, the DOJ filed a criminal indictment in the United States District Court for the Northern District of California in connection with the matter. A superseding indictment was filed in August 2014. The indictment alleges that FedEx Corporation, FedEx Express and FedEx Services, together with certain pharmacies, conspired to unlawfully distribute controlled substances, unlawfully distributed controlled substances and conspired to unlawfully distribute misbranded drugs. The superseding indictment adds conspiracy to launder money counts related to services provided to and payments from online pharmacies. We continue to believe that our employees have acted in good faith at all times and that we have not engaged in any illegal activities.

Accordingly, we will vigorously defend ourselves in this matter. If we are convicted, remedies could include fines, penalties, forfeiture and compliance conditions. Given the early stage of this proceeding, we cannot estimate the amount or range of loss, if any; however, it is reasonably possible that it could be material if we are convicted.

Other Matters. On June 30, 2014, we received a Statement of Objections from the French Competition Authority (“FCA”) addressed to FedEx Express France, formerly known as TATEX, regarding an investigation by the FCA into anticompetitive behavior that is alleged to have occurred primarily in the framework of trade association meetings that included the former general managers of TATEX prior to our acquisition of that company in July 2012. In September 2014, FedEx Express France submitted its observations in response to the Statement of Objections to the FCA. In April 2015, the FCA issued a report responding to the observations submitted by all companies involved in the investigation. We submitted an answer to the FCA’s report in early July. A hearing in this matter before the Board of the FCA has been set for September 30, 2015. Loss in this matter is probable, and in the fourth quarter of 2015 we established an accrual for the estimated probable loss. This amount was immaterial.

FedEx and its subsidiaries are subject to other legal proceedings that arise in the ordinary course of their business. In the opinion of management, the aggregate liability, if any, with respect to these other actions will not have a material adverse effect on our financial position, results of operations or cash flows.

- 18 -

(9) Supplemental Cash Flow Information

Cash paid for interest expense and income taxes for the three-month periods ended August 31 was as follows (in millions):

	2015			2014
Cash payments for:
Interest (net of capitalized interest)	$	139		$	96
Income taxes	$	115		$	190
Income tax refunds received		(2	)		(2	)
Cash tax payments, net	$	113		$	188

(10) Condensed Consolidating Financial Statements

We are required to present condensed consolidating financial information in order for the subsidiary guarantors of our public debt to continue to be exempt from reporting under the Securities Exchange Act of 1934, as amended. FedEx Express, however, currently files reports under such act.

The guarantor subsidiaries, which are wholly owned by FedEx, guarantee $7.0 billion of our debt. The guarantees are full and unconditional and joint and several. Our guarantor subsidiaries were not determined using geographic, service line or other similar criteria, and as a result, the “Guarantor Subsidiaries” and “Non-guarantor Subsidiaries” columns each include portions of our domestic and international operations. Accordingly, this basis of presentation is not intended to present our financial condition, results of operations or cash flows for any purpose other than to comply with the specific requirements for subsidiary guarantor reporting. Prior year amounts have been recast to conform to the pension accounting changes as discussed in our Annual Report.

- 19 -

Condensed consolidating financial statements for our guarantor subsidiaries and non-guarantor subsidiaries are presented in the following tables (in millions):

CONDENSED CONSOLIDATING BALANCE SHEETS

(UNAUDITED)

August 31, 2015

	Parent		Guarantor Subsidiaries		Non-guarantor Subsidiaries		Eliminations			Consolidated
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	2,224	$	446	$	917	$	(44	)	$	3,543
Receivables, less allowances		1		4,308		1,349		(41	)		5,617
Spare parts, supplies, fuel, prepaid expenses and other, less allowances		25		777		135		—			937
Deferred income taxes		—		572		34		—			606
Total current assets		2,250		6,103		2,435		(85	)		10,703
PROPERTY AND EQUIPMENT, AT COST		29		41,521		2,439		—			43,989
Less accumulated depreciation and amortization		23		21,202		1,281		—			22,506
Net property and equipment		6		20,319		1,158		—			21,483
INTERCOMPANY RECEIVABLE		—		533		1,695		(2,228	)		—
GOODWILL		—		1,551		2,241		—			3,792
INVESTMENT IN SUBSIDIARIES		23,722		3,817		—		(27,539	)		—
OTHER ASSETS		2,761		781		416		(2,691	)		1,267
	$	28,739	$	33,104	$	7,945	$	(32,543)		$	37,245
LIABILITIES AND STOCKHOLDERS’ INVESTMENT
CURRENT LIABILITIES
Current portion of long-term debt	$	—	$	6	$	8	$	—		$	14
Accrued salaries and employee benefits		44		1,133		178		—			1,355
Accounts payable		77		1,326		731		(85	)		2,049
Accrued expenses		745		1,400		281		—			2,426
Total current liabilities		866		3,865		1,198		(85	)		5,844
LONG-TERM DEBT, LESS CURRENT PORTION		6,978		248		18		—			7,244
INTERCOMPANY PAYABLE		2,228		—		—		(2,228	)		—
OTHER LONG-TERM LIABILITIES
Deferred income taxes		—		4,237		235		(2,691	)		1,781
Other liabilities		3,384		3,446		263		—			7,093
Total other long-term liabilities		3,384		7,683		498		(2,691	)		8,874
STOCKHOLDERS’ INVESTMENT		15,283		21,308		6,231		(27,539	)		15,283
	$	28,739	$	33,104	$	7,945	$	(32,543	)	$	37,245

- 20 -

CONDENSED CONSOLIDATING BALANCE SHEETS

May 31, 2015

	Parent		Guarantor Subsidiaries		Non-guarantor Subsidiaries		Eliminations			Consolidated
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	2,383	$	487	$	971	$	(78	)	$	3,763
Receivables, less allowances		3		4,383		1,385		(52	)		5,719
Spare parts, supplies, fuel, prepaid expenses and other, less allowances		41		689		123		—			853
Deferred income taxes		—		571		35		—			606
Total current assets		2,427		6,130		2,514		(130	)		10,941
PROPERTY AND EQUIPMENT, AT COST		29		40,364		2,471		—			42,864
Less accumulated depreciation and amortization		23		20,685		1,281		—			21,989
Net property and equipment		6		19,679		1,190		—			20,875
INTERCOMPANY RECEIVABLE		—		686		1,563		(2,249	)		—
GOODWILL		—		1,552		2,258		—			3,810
INVESTMENT IN SUBSIDIARIES		23,173		3,800		—		(26,973	)		—
OTHER ASSETS		2,752		898		477		(2,684	)		1,443
	$	28,358	$	32,745	$	8,002	$	(32,036	)	$	37,069
LIABILITIES AND STOCKHOLDERS’ INVESTMENT
CURRENT LIABILITIES
Current portion of long-term debt	$	—	$	7	$	12	$	—		$	19
Accrued salaries and employee benefits		34		1,208		194		—			1,436
Accounts payable		5		1,433		758		(130	)		2,066
Accrued expenses		604		1,557		275		—			2,436
Total current liabilities		643		4,205		1,239		(130	)		5,957
LONG-TERM DEBT, LESS CURRENT PORTION		6,978		248		23		—			7,249
INTERCOMPANY PAYABLE		2,249		—		—		(2,249	)		—
OTHER LONG-TERM LIABILITIES
Deferred income taxes		—		4,206		225		(2,684	)		1,747
Other liabilities		3,495		3,367		261		—			7,123
Total other long-term liabilities		3,495		7,573		486		(2,684	)		8,870
STOCKHOLDERS’ INVESTMENT		14,993		20,719		6,254		(26,973	)		14,993
	$	28,358	$	32,745	$	8,002	$	(32,036	)	$	37,069

- 21 -

CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME

(UNAUDITED)

Three Months Ended August 31, 2015

	Parent			Guarantor Subsidiaries			Non-guarantor Subsidiaries			Eliminations			Consolidated
REVENUES	$	—		$	9,873		$	2,509		$	(103	)	$	12,279
OPERATING EXPENSES:
Salaries and employee benefits		34			3,813			678			—			4,525
Purchased transportation		—			1,434			965			(55	)		2,344
Rentals and landing fees		1			587			108			(1	)		695
Depreciation and amortization		—			583			65			—			648
Fuel		—			691			21			—			712
Maintenance and repairs		—			508			40			—			548
Intercompany charges, net		(69	)		(40	)		109			—			—
Other		34			1,264			412			(47	)		1,663
		—			8,840			2,398			(103	)		11,135
OPERATING INCOME		—			1,033			111			—			1,144
OTHER INCOME (EXPENSE):
Equity in earnings of subsidiaries		692			61			—			(753	)		—
Interest, net		(75	)		8			4			—			(63	)
Intercompany charges, net		78			(76	)		(2	)		—			—
Other, net		(3	)		(3	)		9			—			3
INCOME BEFORE INCOME TAXES		692			1,023			122			(753	)		1,084
Provision for income taxes		—			357			35			—			392
NET INCOME	$	692		$	666		$	87		$	(753	)	$	692
COMPREHENSIVE INCOME	$	674		$	651		$	(42	)	$	(753	)	$	530

CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME

(UNAUDITED)

Three Months Ended August 31, 2014

(As Adjusted)

	Parent			Guarantor Subsidiaries			Non-guarantor Subsidiaries		Eliminations			Consolidated
REVENUES	$	—		$	9,769		$	2,004	$	(89	)	$	11,684
OPERATING EXPENSES:
Salaries and employee benefits		30			3,534			550		—			4,114
Purchased transportation		—			1,386			711		(43	)		2,054
Rentals and landing fees		1			572			88		(1	)		660
Depreciation and amortization		—			595			56		—			651
Fuel		—			1,095			25		—			1,120
Maintenance and repairs		—			522			34		—			556
Intercompany charges, net		(95	)		2			93		—			—
Other		64			1,165			283		(45	)		1,467
		—			8,871			1,840		(89	)		10,622
OPERATING INCOME		—			898			164		—			1,062
OTHER INCOME (EXPENSE):
Equity in earnings of subsidiaries		653			98			—		(751	)		—
Interest, net		(53	)		4			1		—			(48	)
Intercompany charges, net		54			(59	)		5		—			—
Other, net		(1	)		(3	)		2		—			(2	)
INCOME BEFORE INCOME TAXES		653			938			172		(751	)		1,012
Provision for income taxes		—			296			63		—			359
NET INCOME	$	653		$	642		$	109	$	(751	)	$	653
COMPREHENSIVE INCOME	$	636		$	638		$	83	$	(751	)	$	606

- 22 -

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

(UNAUDITED)

Three Months Ended August 31, 2015

	Parent			Guarantor Subsidiaries			Non- guarantor Subsidiaries			Eliminations			Consolidated
CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES	$	(397	)	$	1,533		$	71		$	34		$	1,241
INVESTING ACTIVITIES
Capital expenditures		—			(1,170	)		(39	)		—			(1,209	)
Proceeds from asset dispositions and other		(5	)		15			—			—			10
CASH USED IN INVESTING ACTIVITIES		(5	)		(1,155	)		(39	)		—			(1,199	)
FINANCING ACTIVITIES
Net transfers from (to) Parent		452			(479	)		27			—			—
Payment on loan between subsidiaries		—			98			(98	)		—			—
Intercompany dividends		—			4			(4	)		—			—
Principal payments on debt		—			(2	)		(13	)		—			(15	)
Proceeds from stock issuances		46			—			—			—			46
Excess tax benefit on the exercise of stock options		6			—			—			—			6
Dividends paid		(71	)		—			—			—			(71	)
Purchase of treasury stock		(190	)		—			—			—			(190	)
Other, net		—			(25	)		25			—			—
CASH (USED IN) PROVIDED BY FINANCING ACTIVITIES		243			(404	)		(63	)		—			(224	)
Effect of exchange rate changes on cash		—			(15	)		(23	)		—			(38	)
Net (decrease) increase in cash and cash equivalents		(159	)		(41	)		(54	)		34			(220	)
Cash and cash equivalents at beginning of period		2,383			487			971			(78	)		3,763
Cash and cash equivalents at end of period	$	2,224		$	446		$	917		$	(44	)	$	3,543

- 23 -

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

(UNAUDITED)

Three Months Ended August 31, 2014

	Parent			Guarantor Subsidiaries			Non- guarantor Subsidiaries			Eliminations			Consolidated
CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES	$	(67	)	$	934		$	105		$	10		$	982
INVESTING ACTIVITIES
Capital expenditures		(1	)		(688	)		(31	)		—			(720	)
Proceeds from asset dispositions and other		—			7			(3	)		—			4
CASH USED IN INVESTING ACTIVITIES		(1	)		(681	)		(34	)		—			(716	)
FINANCING ACTIVITIES
Net transfers from (to) Parent		358			(366	)		8			—			—
Payment on loan between subsidiaries		—			103			(103	)		—			—
Intercompany dividends		—			2			(2	)		—			—
Proceeds from stock issuances		97			—			—			—			97
Excess tax benefit on the exercise of stock options		10			—			—			—			10
Dividends paid		(57	)		—			—			—			(57	)
Purchase of treasury stock		(791	)		—			—			—			(791	)
Other, net		—			(1	)		1			—			—
CASH USED IN FINANCING ACTIVITIES		(383	)		(262	)		(96	)		—			(741	)
Effect of exchange rate changes on cash		—			(2	)		(15	)		—			(17	)
Net (decrease) increase in cash and cash equivalents		(451	)		(11	)		(40	)		10			(492	)
Cash and cash equivalents at beginning of period		1,756			441			861			(150	)		2,908
Cash and cash equivalents at end of period	$	1,305		$	430		$	821		$	(140	)	$	2,416

- 24 -

REPORT OF INDEPENDENT REGISTERED

PUBLIC ACCOUNTING FIRM

The Board of Directors and Stockholders

FedEx Corporation

We have reviewed the condensed consolidated balance sheet of FedEx Corporation as of August 31, 2015, and the related condensed consolidated statements of income, comprehensive income and cash flows for the three-month periods ended August 31, 2015 and 2014. These financial statements are the responsibility of the Company’s management.

We conducted our review in accordance with the standards of the Public Company Accounting Oversight Board (United States). A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with the standards of the Public Company Accounting Oversight Board, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.

Based on our review, we are not aware of any material modifications that should be made to the condensed consolidated financial statements referred to above for them to be in conformity with U.S. generally accepted accounting principles.

We have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheet of FedEx Corporation as of May 31, 2015, and the related consolidated statements of income, comprehensive income, changes in stockholders’ investment, and cash flows for the year then ended not presented herein, and in our report dated July 14, 2015, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying condensed consolidated balance sheet as of May 31, 2015, is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived.

/s/ Ernst & Young LLP

Memphis, Tennessee

September 17, 2015

- 25 -

Item 2. Management’s Discussion and Analysis of Results of Operations and Financial Condition

GENERAL

The following Management’s Discussion and Analysis of Results of Operations and Financial Condition (“MD&A”) describes the principal factors affecting the results of operations, liquidity, capital resources, contractual cash obligations and critical accounting estimates of FedEx Corporation (“FedEx”). This discussion should be read in conjunction with the accompanying quarterly unaudited condensed consolidated financial statements and our Annual Report on Form 10-K for the year ended May 31, 2015 (“Annual Report”). Our Annual Report includes additional information about our significant accounting policies, practices and the transactions that underlie our financial results, as well as a detailed discussion of the most significant risks and uncertainties associated with our financial condition and operating results.

We provide a broad portfolio of transportation, e-commerce and business services through companies competing collectively, operating independently and managed collaboratively, under the respected FedEx brand. Our primary operating companies are Federal Express Corporation (“FedEx Express”), the world’s largest express transportation company; FedEx Ground Package System, Inc. (“FedEx Ground”), a leading North American provider of small-package ground delivery services; and FedEx Freight, Inc. (“FedEx Freight”), a leading U.S. provider of less-than-truckload (“LTL”) freight services. These companies represent our major service lines and, along with FedEx Corporate Services, Inc. (“FedEx Services”), form the core of our reportable segments.

Our FedEx Services segment provides sales, marketing, information technology, communications and certain back-office support to our transportation segments. In addition, the FedEx Services segment provides customers with retail access to FedEx Express and FedEx Ground shipping services through FedEx Office and Print Services, Inc. (“FedEx Office”) and provides customer service, technical support and billing and collection services through FedEx TechConnect, Inc. (“FedEx TechConnect”). See “Reportable Segments” for further discussion. Additional information on our businesses can also be found in our Annual Report.

The key indicators necessary to understand our operating results include:

• the overall customer demand for our various services based on macro-economic factors and the global economy;

• the volumes of transportation services provided through our networks, primarily measured by our average daily volume and shipment weight;

• the mix of services purchased by our customers;

• the prices we obtain for our services, primarily measured by yield (revenue per package or pound or revenue per hundredweight and shipment for LTL freight shipments);

• our ability to manage our cost structure (capital expenditures and operating expenses) to match shifting volume levels; and

• the timing and amount of fluctuations in fuel prices and our ability to recover incremental fuel costs through our fuel surcharges.

The majority of our operating expenses are directly impacted by revenue and volume levels. Accordingly, we expect these operating expenses to fluctuate on a year-over-year basis consistent with the change in revenues and volumes. Therefore, the discussion of operating expense captions focuses on the key drivers and trends impacting expenses other than changes in revenues and volume. The line item “Other operating expenses” predominantly includes costs associated with outside service contracts (such as security, facility services and cargo handling), insurance, professional fees, uniforms and advertising.

- 26 -

Except as otherwise specified, references to years indicate our fiscal year ending May 31, 2016 or ended May 31 of the year referenced and comparisons are to the corresponding period of the prior year. References to our transportation segments include, collectively, our FedEx Express, FedEx Ground and FedEx Freight segments.

RESULTS OF OPERATIONS

CONSOLIDATED RESULTS

The following tables compare summary operating results and changes in revenues and operating income (dollars in millions, except per share amounts) for the three-month periods ended August 31:

	2015			2014			Percent Change
Consolidated revenues	$	12,279		$	11,684			5
FedEx Express Segment operating income		545			377			45
FedEx Ground Segment operating income		537			545			(1	)
FedEx Freight Segment operating income		132			168			(21	)
Eliminations, corporate and other		(70	)		(28	)		NM
Consolidated operating income		1,144			1,062			8
FedEx Express Segment operating margin		8.3	%		5.5	%		280	bp
FedEx Ground Segment operating margin		14.0	%		18.4	%		(440	)bp
FedEx Freight Segment operating margin		8.2	%		10.4	%		(220	)bp
Consolidated operating margin		9.3	%		9.1	%		20	bp
Consolidated net income	$	692		$	653			6
Diluted earnings per share	$	2.42		$	2.26			7

	Year-over-Year Changes
	Revenues			Operating Income
FedEx Express segment	$	(271	)	$	168
FedEx Ground segment		870			(8	)
FedEx Freight segment		(8	)		(36	)
FedEx Services segment		16			—
Eliminations, corporate and other		(12	)		(42	)
	$	595		$	82

Overview

Our results for the first quarter of 2016 improved due to higher operating income at FedEx Express, the benefit of one additional operating day at all our transportation segments and the continued positive impacts from our profit improvement program commenced in 2013. These factors were partially offset by higher incentive compensation accruals, higher self-insurance costs at FedEx Ground and lower than anticipated volume at FedEx Freight.

“Eliminations, corporate and other” for the first quarter of 2015 included a benefit of $67 million as a result of our change in recognizing expected return on plan assets for our defined benefit pension and postretirement healthcare plans at the segment level and a legal contingency reserve associated with a multi-district litigation matter.

- 27 -

The following graphs for FedEx Express, FedEx Ground and FedEx Freight show selected volume trends (in thousands) over the five most recent quarters:

⁽¹⁾ International domestic average daily package volume represents our international intra-country express operations.

- 28 -

The following graphs for FedEx Express, FedEx Ground and FedEx Freight show selected yield trends over the five most recent quarters:

Revenue

Revenues increased 5% during the first quarter of 2016 driven by the FedEx Ground segment due to the inclusion of GENCO Distribution System, Inc. (“GENCO”) revenue, as well as rate increases and volume growth in our FedEx Home Delivery service. In addition, revenues increased approximately $240 million as a result of recording FedEx SmartPost service revenues on a gross basis, versus our previous net treatment, as further discussed in our Annual Report and in Note 1 of our unaudited condensed consolidated financial statements. Lower fuel surcharges had a significant negative impact on revenues at all of our transportation segments but did not materially impact our earnings. In addition, revenues at FedEx Express were negatively impacted by unfavorable exchange rates. One additional operating day benefited revenues in the first quarter of 2016.

- 29 -

Operating Expenses

The following table compares operating expenses expressed as dollar amounts (in millions) and as a percent of revenue for the three-month periods ended August 31:

					Percent of Revenue
	2015		2014		2015			2014
Operating expenses:
Salaries and employee benefits	$	4,525	$	4,114		36.9	%		35.2	%
Purchased transportation		2,344		2,054		19.1			17.6
Rentals and landing fees		695		660		5.6			5.6
Depreciation and amortization		648		651		5.3			5.6
Fuel		712		1,120		5.8			9.6
Maintenance and repairs		548		556		4.5			4.8
Other		1,663		1,467		13.5			12.5
Total operating expenses	$	11,135	$	10,622		90.7			90.9
Operating margin						9.3	%		9.1	%

Our operating margin increased in the first quarter of 2016 primarily due to strong performance at FedEx Express. However, operating margin was partially offset by higher incentive compensation accruals, higher self-insurance costs at FedEx Ground, higher salaries and employee benefits at FedEx Freight, the recording of FedEx SmartPost service revenues on a gross basis and the inclusion of GENCO results.

Operating expenses included an increase in salaries and employee benefits expense of 10% in the first quarter of 2016 due to the inclusion of GENCO results, higher incentive compensation accruals and pay initiatives coupled with increased staffing at FedEx Freight. Purchased transportation costs increased 14% in the first quarter of 2016 due to the recording of FedEx SmartPost service revenues on a gross basis and higher volumes and higher utilization of third-party transportation providers at FedEx Ground. Other expenses were driven 13% higher in the first quarter of 2016 due to the inclusion of GENCO results and higher self-insurance insurance costs at FedEx Ground.

- 30 -

Fuel

The following graph for our transportation segments shows our average cost of jet and vehicle fuel per gallon for the five most recent quarters:

Fuel expense decreased 36% in the first quarter of 2016 due to lower fuel prices. However, fuel prices represent only one component of the two factors we consider meaningful in understanding the impact of fuel on our business. Consideration must also be given to the fuel surcharge revenue we collect. Accordingly, we believe discussion of the net impact of fuel on our results, which is a comparison of the year-over-year change in these two factors, is important to understand the impact of fuel on our business. In order to provide information about the impact of fuel surcharges on the trend in revenue and yield growth, we have included the comparative weighted-average fuel surcharge percentages in effect for the first quarter of 2016 and 2015 in the accompanying discussions of each of our transportation segments.

The index used to determine the fuel surcharge percentage for our FedEx Freight business adjusts weekly, while our fuel surcharges for the FedEx Express and FedEx Ground businesses incorporate a timing lag of approximately six to eight weeks before they are adjusted for changes in fuel prices. For example, the fuel surcharge index in effect at FedEx Express in August 2015 was set based on June 2015 fuel prices. In addition, the structure of the table that is used to determine our fuel surcharge at FedEx Express and FedEx Ground does not adjust immediately for changes in fuel price, but allows for the fuel surcharge revenue charged to our customers to remain unchanged as long as fuel prices remain within certain ranges.

Beyond these factors, the manner in which we purchase fuel also influences the net impact of fuel on our results. For example, our contracts for jet fuel purchases at FedEx Express are tied to various indices, including the U.S. Gulf Coast index. While many of these indices are aligned, each index may fluctuate at a different pace, driving variability in the prices paid for jet fuel. Furthermore, under these contractual arrangements, approximately 75% of our jet fuel is purchased based on the index price for the preceding week, with the remainder of our purchases tied to the index price for the preceding month, rather than based on daily spot rates. These contractual provisions mitigate the impact of rapidly changing daily spot rates on our jet fuel purchases.

Because of the factors described above, our operating results may be affected should the market price of fuel suddenly change by a significant amount or change by amounts that do not result in an adjustment in our fuel surcharges, which can significantly affect our earnings either positively or negatively in the short-term.

We routinely review our fuel surcharges and our fuel surcharge methodology. On November 2, 2015, FedEx Express and FedEx Ground will update certain tables used to determine fuel surcharges.

- 31 -

The net impact of fuel had a slightly negative impact to consolidated operating income in the first quarter of 2016. This was driven by the year-over-year decrease in fuel surcharge revenue during these periods, which was partially offset by decreased fuel prices during the first quarter of 2016 versus the prior year.

The net impact of fuel on our operating results does not consider the effects that fuel surcharge levels may have on our business, including changes in demand and shifts in the mix of services purchased by our customers. While fluctuations in fuel surcharge percentages can be significant from period to period, fuel surcharges represent one of the many individual components of our pricing structure that impact our overall revenue and yield. Additional components include the mix of services sold, the base price and extra service charges we obtain for these services and the level of pricing discounts offered.

Income Taxes

Our effective tax rate was 36.2% for the first quarter of 2016 and 35.5% for the first quarter of 2015. The tax rate in the first quarter of 2015 was lower due to discrete tax benefits related to changes in valuation allowances required in certain entities and jurisdictions. For 2016, we expect our effective tax rate to be between 36.0% and 37.0% prior to any year-end mark-to-market accounting adjustment for defined benefit pension and postretirement healthcare plans (“MTM Adjustment”). The actual rate, however, will depend on a number of factors, including the amount and source of operating income and the impact of the MTM Adjustment.

We are subject to taxation in the United States and various U.S. state, local and foreign jurisdictions. We are currently under examination by the Internal Revenue Service for the 2012 and 2013 tax years. It is reasonably possible that certain income tax return proceedings will be completed during the next 12 months and could result in a change in our balance of unrecognized tax benefits. The expected impact of any changes would not be material to our consolidated financial statements. As of August 31, 2015, there were no material changes to our liabilities for unrecognized tax benefits from May 31, 2015.

Business Acquisitions

As discussed in our Annual Report, on April 6, 2015, we entered into a conditional agreement to acquire TNT Express N.V. (“TNT Express”) for €4.4 billion (currently, approximately $5.0 billion). This combination is expected to expand our global portfolio, particularly in Europe, lower our costs to serve our European markets by increasing density in our pickup-and-delivery operations and accelerate our global growth. This acquisition is expected to be completed in the first half of calendar year 2016. The closing of the acquisition is subject to customary conditions, including obtaining all necessary approvals and competition clearances. We expect to secure all relevant competition approvals.

During 2015, we acquired two businesses, expanding our portfolio in e-commerce and supply chain solutions. On January 30, 2015, we acquired GENCO, a leading North American third-party logistics provider, for $1.4 billion, which was funded using a portion of the proceeds from our January 2015 debt issuance. The financial results of this business are included in the FedEx Ground segment from the date of acquisition.

In addition, on December 16, 2014, we acquired Bongo International, LLC (“Bongo”), a leader in cross-border enablement technologies and solutions, for $42 million in cash from operations. The financial results of this business are included in the FedEx Express segment from the date of acquisition.

These acquisitions will allow us to enter new markets, as well as strengthen our current service offerings to existing customers. See Note 1 of the accompanying unaudited condensed consolidated financial statements for further discussion of these acquisitions.

- 32 -

Outlook

We expect revenue and earnings growth in the second quarter and the full year of 2016 prior to any MTM Adjustment driven by ongoing improvements in the results of our transportation segments due to volume and yield growth, despite weaker than anticipated economic conditions. Our results in 2016 will continue to benefit from execution of the profit improvement programs announced in 2013, which are further described in our Annual Report. Our expectations for earnings growth in the second quarter and the remainder of 2016 are dependent on key external factors, including fuel prices and the pace of improvement in the global economy. Our outlook for 2016 does not contemplate any impact from our announced intent to acquire TNT Express, such as integration planning or transaction costs or the operating activities of TNT Express if the transaction is consummated.

Other Outlook Matters. For details on key 2016 capital projects, refer to the “Liquidity Outlook” section of this MD&A.

As described in Note 8 of the accompanying unaudited condensed consolidated financial statements and the “Independent Contractor Model” section of our FedEx Ground segment MD&A, we are involved in a number of lawsuits and other proceedings that challenge the status of FedEx Ground’s owner-operators as independent contractors. FedEx Ground anticipates continuing changes to its relationships with its owner-operators. The nature, timing and amount of any changes are dependent on the outcome of numerous future events. We cannot reasonably estimate the potential impact of any such changes or a meaningful range of potential outcomes, although they could be material. However, we do not believe that any such changes will impair our ability to operate and profitably grow our FedEx Ground business.

See “Forward-Looking Statements” for a discussion of these and other potential risks and uncertainties that could materially affect our future performance.

RECENT ACCOUNTING GUIDANCE

New accounting rules and disclosure requirements can significantly impact our reported results and the comparability of our financial statements. These matters are described in our Annual Report.

We believe that no other new accounting guidance was adopted or issued during the first three months of 2016 that is relevant to the readers of our financial statements. However, there are numerous new proposals under development which, if and when enacted, may have a significant impact on our financial reporting.

- 33 -

REPORTABLE SEGMENTS

FedEx Express, FedEx Ground and FedEx Freight represent our major service lines and, along with FedEx Services, form the core of our reportable segments. Our reportable segments include the following businesses:

FedEx Express Segment	FedEx Express (express transportation)
	FedEx Trade Networks (air and ocean freight forwarding and customs brokerage)
	FedEx SupplyChain Systems (logistics services)
	Bongo (cross-border enablement technology and solutions)
FedEx Ground Segment	FedEx Ground (small-package ground delivery)
	GENCO (third-party logistics)
FedEx Freight Segment	FedEx Freight (LTL freight transportation)
	FedEx Custom Critical (time-critical transportation)
FedEx Services Segment	FedEx Services (sales, marketing, information technology, communications and back-office functions)
	FedEx TechConnect (customer service, technical support, billings and collections)
	FedEx Office (document and business services and package acceptance)

FEDEX SERVICES SEGMENT

The operating expenses line item “Intercompany charges” on the accompanying unaudited condensed consolidated financial statements of our transportation segments reflects the allocations from the FedEx Services segment to the respective transportation segments. The allocations of net operating costs are based on metrics such as relative revenues or estimated services provided.

The FedEx Services segment provides direct and indirect support to our transportation businesses, and we allocate all of the net operating costs of the FedEx Services segment (including the net operating results of FedEx Office) to reflect the full cost of operating our transportation businesses in the results of those segments. Within the FedEx Services segment allocation, the net operating results of FedEx Office, which are an immaterial component of our allocations, are allocated to FedEx Express and FedEx Ground. We review and evaluate the performance of our transportation segments based on operating income (inclusive of FedEx Services segment allocations). For the FedEx Services segment, performance is evaluated based on the impact of its total allocated net operating costs on our transportation segments. We believe these allocations approximate the net cost of providing these functions. Our allocation methodologies are refined periodically, as necessary, to reflect changes in our businesses.

ELIMINATIONS, CORPORATE AND OTHER

Certain FedEx operating companies provide transportation and related services for other FedEx companies outside their reportable segment. Billings for such services are based on negotiated rates, which we believe approximate fair value, and are reflected as revenues of the billing segment. These rates are adjusted from time to time based on market conditions. Such intersegment revenues and expenses are eliminated in our consolidated results and are not separately identified in the following segment information, because the amounts are not material.

Corporate and other includes corporate headquarters costs for executive officers, certain other legal and financial functions, as well as certain other costs and credits not attributed to our core business. These costs are not allocated to the business segments.

- 34 -

FEDEX EXPRESS SEGMENT

FedEx Express offers a wide range of U.S. domestic and international shipping services for delivery of packages and freight including priority services, which provide time-definite delivery within one, two or three business days worldwide, and deferred or economy services, which provide time-definite delivery within five business days worldwide. The following table compares revenues, operating expenses, operating expenses as a percent of revenue, operating income (dollars in millions) and operating margin for the three-month periods ended August 31:

							Percent
	2015			2014			Change
Revenues:
Package:
U.S. overnight box	$	1,658		$	1,682			(1	)
U.S. overnight envelope		422			415			2
U.S. deferred		816			795			3
Total U.S. domestic package revenue		2,896			2,892			—
International priority		1,464			1,630			(10	)
International economy		574			571			1
Total international export package revenue		2,038			2,201			(7	)
International domestic(1)		327			371			(12	)
Total package revenue		5,261			5,464			(4	)
Freight:
U.S.		573			579			(1	)
International priority		350			395			(11	)
International airfreight		36			46			(22	)
Total freight revenue		959			1,020			(6	)	Percent of Revenue
Other(2)		371			378			(2	)	2015		2014
Total revenues		6,591			6,862			(4	)	100.0	%	100.0	%
Operating expenses:
Salaries and employee benefits		2,523			2,478			2		38.3		36.1
Purchased transportation		601			647			(7	)	9.1		9.4
Rentals and landing fees		410			426			(4	)	6.2		6.2
Depreciation and amortization		347			374			(7	)	5.3		5.5
Fuel		607			970			(37	)	9.2		14.1
Maintenance and repairs		345			379			(9	)	5.2		5.5
Intercompany charges		445			448			(1	)	6.7		6.6
Other		768			763			1		11.7		11.1
Total operating expenses		6,046			6,485			(7	)	91.7	%	94.5	%
Operating income	$	545		$	377			45
Operating margin		8.3	%		5.5	%		280	bp

⁽¹⁾ International domestic revenues represent our international intra-country express operations.

⁽²⁾ Includes FedEx Trade Networks, FedEx SupplyChain Systems and Bongo.

- 35 -

The following table compares selected statistics (in thousands, except yield amounts) for the three-month periods ended August 31:

					Percent
	2015		2014		Change
Package Statistics(1)
Average daily package volume (ADV):
U.S. overnight box		1,210		1,211		—
U.S. overnight envelope		541		527		3
U.S. deferred		865		846		2
Total U.S. domestic ADV		2,616		2,584		1
International priority		389		409		(5	)
International economy		176		170		4
Total international export ADV		565		579		(2	)
International domestic(2)		855		816		5
Total ADV		4,036		3,979		1
Revenue per package (yield):
U.S. overnight box	$	21.08	$	21.69		(3	)
U.S. overnight envelope		11.99		12.32		(3	)
U.S. deferred		14.52		14.68		(1	)
U.S. domestic composite		17.03		17.49		(3	)
International priority		57.86		62.19		(7	)
International economy		50.18		52.60		(5	)
International export composite		55.47		59.38		(7	)
International domestic(2)		5.88		7.10		(17	)
Composite package yield		20.05		21.46		(7	)
Freight Statistics(1)
Average daily freight pounds:
U.S.		7,278		7,318		(1	)
International priority		2,491		2,792		(11	)
International airfreight		609		670		(9	)
Total average daily freight pounds		10,378		10,780		(4	)
Revenue per pound (yield):
U.S.	$	1.21	$	1.24		(2	)
International priority		2.16		2.21		(2	)
International airfreight		0.92		1.07		(14	)
Composite freight yield		1.42		1.48		(4	)

⁽¹⁾ Package and freight statistics include only the operations of FedEx Express.

⁽²⁾ International domestic statistics represent our international intra-country express operations.

FedEx Express Segment Revenues

FedEx Express segment revenues decreased 4% in the first quarter of 2016 due to the negative impact of lower fuel surcharges and unfavorable exchange rates, which were partially offset by U.S. domestic base yield and volume growth and international export base yield growth. U.S. domestic average daily volumes increased 1% in the first quarter of 2016 driven by both our deferred and overnight service offerings. U.S. domestic yields decreased 3% in the first quarter of 2016 due to the negative impact of lower fuel surcharges, which were partially offset by higher base rates. International export yields decreased 7% in the first quarter of 2016 due to the negative impact of lower fuel surcharges and unfavorable exchange rates and were partially offset by higher base rates and higher weights. International domestic revenues declined 12% in the first quarter of 2016 due to the negative impact of unfavorable exchange rates, which were partially offset by a 5% volume increase. One additional operating day benefited revenues in the first quarter of 2016.

- 36 -

Our fuel surcharges are indexed to the spot price for jet fuel. Using this index, the U.S. domestic and outbound fuel surcharge percentages and the international fuel surcharge percentages ranged as follows for the three-month periods ended August 31:

	2015			2014
U.S. Domestic and Outbound Fuel Surcharge:
Low		3.00	%		9.50	%
High		4.00			9.50
Weighted-average		3.34			9.50
International Fuel Surcharges:
Low		3.00			13.50
High		12.00			18.00
Weighted-average		8.82			16.26

On September 15, 2015, FedEx Express announced a 4.9% average list price increase for FedEx Express U.S. domestic, U.S. export and U.S. import services effective January 4, 2016. In addition, effective November 2, 2015, FedEx Express will update certain tables used to determine fuel surcharges. On February 2, 2015, FedEx Express updated the tables used to determine fuel surcharges. On September 16, 2014, FedEx Express announced a 4.9% average list price increase for FedEx Express U.S. domestic, U.S. export and U.S. import services effective January 5, 2015. In January 2014, we implemented a 3.9% average list price increase for FedEx Express U.S. domestic, U.S. export and U.S. import services.

FedEx Express Segment Operating Income

FedEx Express operating income increased 45% and operating margin grew 280 basis points in the first quarter of 2016, despite a 4% revenue decline. This increase was primarily driven by higher international export and U.S. domestic base yield growth, the benefit from one additional operating day and lower international expenses due to currency exchange rates. These factors were partially offset by higher incentive compensation accruals. Profit improvement program initiatives continued to improve revenue quality and constrain expenses for the first quarter of 2016.

Salaries and employee benefits increased 2% in the first quarter of 2016 due to merit increases and higher incentive compensation accruals. Maintenance and repairs expense decreased 9% in the first quarter of 2016 due to the timing of prior year aircraft maintenance events. Aircraft retirements during 2015 drove a 7% decrease in depreciation and amortization expense in the first quarter of 2016. Purchased transportation expenses decreased 7% in the first quarter of 2016 driven by a favorable exchange rate impact.

Fuel expense decreased 37% during the first quarter of 2016 due to lower aircraft fuel prices. See the “Fuel” section of this MD&A for a description and additional discussion of the net impact of fuel on our operating results.

- 37 -

FEDEX GROUND SEGMENT

FedEx Ground service offerings include day-certain delivery to businesses in the U.S. and Canada and to nearly 100% of U.S. residences. On August 31, 2015, our FedEx SmartPost business was merged into FedEx Ground. The FedEx SmartPost service remains an important component of our FedEx Ground service offerings; however, for presentation purposes, FedEx SmartPost service revenues and operating statistics have been combined with our FedEx Ground service offerings. Also, on June 1, 2015, we prospectively began recording revenues associated with the FedEx SmartPost service on a gross basis and including postal fees in revenues and expenses, versus our previous net treatment as discussed in our Annual Report. On January 30, 2015, we acquired GENCO, a leading North American third-party logistics provider. GENCO’s financial results are included in the following table from the date of acquisition, which has impacted the year-over-year comparability of revenue and operating expenses. The following tables compare revenues, operating expenses, operating expenses as a percent of revenue, operating income (dollars in millions) and operating margin and selected package statistics (in thousands, except yield amounts) for the three-month periods ended August 31:

							Percent
	2015			2014			Change
Revenues:
FedEx Ground	$	3,460		$	2,960			17		Percent of Revenue
GENCO		370			—			NM		2015		2014
Total revenues		3,830			2,960			29		100.0	%	100.0	%
Operating expenses:
Salaries and employee benefits		653			448			46		17.0		15.1
Purchased transportation		1,527			1,154			32		39.9		39.0
Rentals		145			108			34		3.8		3.7
Depreciation and amortization		146			119			23		3.8		4.0
Fuel		3			3			—		0.1		0.1
Maintenance and repairs		69			56			23		1.8		1.9
Intercompany charges		297			275			8		7.8		9.3
Other		453			252			80		11.8		8.5
Total operating expenses		3,293			2,415			36		86.0	%	81.6	%
Operating income	$	537		$	545			(1	)
Operating margin		14.0	%		18.4	%		(440	)bp
Average daily package volume
FedEx Ground		6,717			6,456			4
Revenue per package (yield)
FedEx Ground	$	7.91		$	7.15			11

FedEx Ground Segment Revenues

FedEx Ground segment revenues increased 29% during the first quarter of 2016 due to the inclusion of GENCO revenue, the recording of FedEx SmartPost revenues on a gross basis and yield and volume growth at FedEx Ground, and were partially offset by lower fuel surcharges. Revenues increased approximately $240 million as a result of recording FedEx SmartPost revenues on a gross basis, versus our previous net treatment, as further discussed in our Annual Report.

Average daily volume at FedEx Ground increased 4% during the first quarter of 2016 primarily due to continued growth in our FedEx Home Delivery service. FedEx Ground yield increased 11% during the first quarter of 2016 primarily due to the recording of FedEx SmartPost revenues on a gross basis, versus our previous net treatment, dimensional weight charges and increased rates, and was partially offset by lower fuel surcharges.

- 38 -

The FedEx Ground fuel surcharge is based on a rounded average of the national U.S. on-highway average price for a gallon of diesel fuel, as published by the Department of Energy. Our fuel surcharge percentages ranged as follows for the three-month periods ended August 31:

	2015			2014
Low		4.00	%		6.50	%
High		4.50			7.00
Weighted-average		4.30			6.83

On September 15, 2015, FedEx Ground announced a 4.9% increase in average list price effective January 4, 2016. In addition, FedEx Ground is increasing surcharges for shipments that exceed the published maximum weight or dimensional limits and updating certain tables used to determine fuel surcharges effective November 2, 2015. On February 2, 2015, FedEx Ground updated the tables used to determine fuel surcharges. On September 16, 2014, FedEx Ground and FedEx Home Delivery announced a 4.9% increase in average list price effective January 5, 2015. In addition, as announced in May 2014, FedEx Ground began applying dimensional weight pricing to all shipments effective January 5, 2015. In January 2014, FedEx Ground and FedEx Home Delivery implemented a 4.9% increase in average list price. FedEx SmartPost rates also increased.

FedEx Ground Segment Operating Income

FedEx Ground segment operating income and margin decreased during the first quarter of 2016 due to higher self-insurance costs and higher than expected operational costs due in part to increasing package sizes. In addition, the inclusion of GENCO results and the recording of FedEx SmartPost revenues on a gross basis negatively impacted operating margin for the first quarter of 2016. These factors were partially offset by yield and volume growth and the benefit of one additional operating day.

The inclusion of GENCO in the FedEx Ground segment results has impacted the year-over-year comparability of all operating expenses. Along with incremental costs from GENCO, purchased transportation expense increased 32% in the first quarter of 2016 due to the recording of FedEx SmartPost revenues on a gross basis, as further discussed in this MD&A, higher volumes and higher utilization of third-party transportation providers. Salaries and employee benefits expense increased 46% during the first quarter of 2016 due to the inclusion of GENCO results, additional staffing to support volume growth and higher healthcare costs. Other expense increased 80% in the first quarter of 2016 primarily due to the addition of GENCO results and higher self-insurance costs. Rentals expense increased 34% in the first quarter of 2016 due to network expansion and the inclusion of GENCO results. Depreciation and amortization expense increased 23% in the first quarter of 2016 due to network expansion and the inclusion of GENCO results.

Independent Contractor Model

FedEx Ground is involved in numerous lawsuits and other proceedings (such as state tax or other administrative challenges) where the classification of its independent contractors is at issue. We are vigorously defending ourselves in all of these proceedings and continue to believe that FedEx Ground’s owner-operators are properly classified as independent contractors and not employees of FedEx Ground. For a description of these proceedings, see Note 8 of the accompanying unaudited condensed consolidated financial statements.

For additional information on the FedEx Ground Independent Service Provider model, see Part 1, Item 1 of our Annual Report under the caption “Independent Contractor Model.”

- 39 -

FEDEX FREIGHT SEGMENT

FedEx Freight service offerings include priority services when speed is critical and economy services when time can be traded for savings. The following table compares revenues, operating expenses, operating expenses as a percent of revenue, operating income (dollars in millions), operating margin and selected statistics for the three-month periods ended August 31:

							Percent			Percent of Revenue
	2015			2014			Change			2015			2014
Revenues	$	1,601		$	1,609			—			100.0	%		100.0	%
Operating expenses:
Salaries and employee benefits		721			656			10			45.0			40.8
Purchased transportation		251			284			(12	)		15.7			17.7
Rentals		43			32			34			2.7			2.0
Depreciation and amortization		59			58			2			3.7			3.6
Fuel		102			147			(31	)		6.4			9.1
Maintenance and repairs		53			46			15			3.3			2.9
Intercompany charges		113			110			3			7.1			6.8
Other		127			108			18			7.9			6.7
Total operating expenses		1,469			1,441			2			91.8	%		89.6	%
Operating income	$	132		$	168			(21	)
Operating margin		8.2	%		10.4	%		(220	)bp
Average daily LTL shipments (in thousands)
Priority		66.5			69.0			(4	)
Economy		30.7			29.1			5
Total average daily LTL shipments		97.2			98.1			(1	)
Weight per LTL shipment (lbs)
Priority		1,198			1,258			(5	)
Economy		1,168			1,013			15
Composite weight per LTL shipment		1,189			1,185			—
LTL revenue per shipment
Priority	$	223.26		$	228.07			(2	)
Economy		269.33			265.42			1
Composite LTL revenue per shipment	$	237.81		$	239.16			(1	)
LTL revenue per hundredweight
Priority	$	18.63		$	18.14			3
Economy		23.06			26.19			(12	)
Composite LTL revenue per hundredweight	$	20.01		$	20.18			(1	)

FedEx Freight Segment Revenues

FedEx Freight segment revenues were essentially flat during the first quarter of 2016 as the benefit of one additional operating day was offset by slightly lower revenue per LTL shipment and lower average daily LTL shipments. Revenue per LTL shipment was down as rate increases were more than offset by lower fuel surcharge revenue. Average daily LTL shipments decreased 1% in the first fiscal quarter of 2016 due to decreased demand in the market.

- 40 -

The indexed LTL fuel surcharge is based on the average of the national U.S. on-highway average price for a gallon of diesel fuel, as published by the Department of Energy. The indexed LTL fuel surcharge percentages ranged as follows for the three-month periods ended August 31:

	2015			2014
Low		21.40	%		25.70	%
High		23.10			26.20
Weighted-average		22.40			26.00

On September 15, 2015, FedEx Freight announced a 4.9% average increase in certain U.S. and other shipping rates effective January 4, 2016. On February 2, 2015, FedEx Freight updated the tables used to determine fuel surcharges. On September 16, 2014, FedEx Freight announced a 4.9% average increase in certain U.S. and other shipping rates effective January 5, 2015. In June 2014, FedEx Freight increased its published fuel surcharge indices by three percentage points. In March 2014, FedEx Freight increased certain U.S. and other shipping rates by an average of 3.9%. In July 2013, FedEx Freight increased certain U.S. and other shipping rates by an average of 4.5%.

FedEx Freight Segment Operating Income

FedEx Freight segment operating income and operating margin decreased in the first quarter of 2016 due to salaries and employee benefits expense outpacing lower than anticipated volume, as well as a facility closure charge. Within operating expenses, salaries and employee benefits increased 10% driven by pay initiatives in the current quarter, increased staffing levels that anticipated higher shipment volumes and deferral of pay increases in the prior year. Other expenses increased 18% in the first quarter of 2016 primarily due to a legal reserve, higher supplies expense and higher cargo claims. Rentals increased 34% driven primarily by a charge related to a facility closure. Purchased transportation expense decreased 12% due to lower utilization of third-party transportation providers and lower rates.

- 41 -

FINANCIAL CONDITION

LIQUIDITY

Cash and cash equivalents totaled $3.5 billion at August 31, 2015, compared to $3.8 billion at May 31, 2015. The following table provides a summary of our cash flows for the three-month periods ended August 31 (in millions):

	2015			2014
Operating activities:
Net income	$	692		$	653
Noncash charges and credits		749			712
Changes in assets and liabilities		(200	)		(383	)
Cash provided by operating activities		1,241			982
Investing activities:
Capital expenditures		(1,209	)		(720	)
Proceeds from asset dispositions and other		10			4
Cash used in investing activities		(1,199	)		(716	)
Financing activities:
Principal payments on debt		(15	)		—
Proceeds from stock issuances		46			97
Excess tax benefit on the exercise of stock options		6			10
Dividends paid		(71	)		(57	)
Purchase of treasury stock		(190	)		(791	)
Cash used in financing activities		(224	)		(741	)
Effect of exchange rate changes on cash		(38	)		(17	)
Net decrease in cash and cash equivalents	$	(220	)	$	(492	)
Cash and cash equivalents at the end of period	$	3,543		$	2,416

Cash flows from operating activities increased $259 million in the first quarter of 2016 predominately due to higher net income and lower income tax payments. Capital expenditures during the first three months of 2016 were higher than capital expenditures in the first three months of 2015, primarily due to increased spending for aircraft at FedEx Express. See “Capital Resources” for a discussion of capital expenditures during 2016 and 2015.

In September 2014, our Board of Directors authorized the repurchase of up to 15 million shares of common stock. During the first quarter of 2016, we repurchased 1.1 million shares of FedEx common stock at an average price of $172 per share for a total of $190 million. As of August 31, 2015, 11.1 million shares remained under the share repurchase authorization. This authorization may be utilized to offset equity compensation and dilution and for opportunistic repurchases based on market conditions and other factors. The timing and volume of repurchases are at the discretion of management.

- 42 -

CAPITAL RESOURCES

Our operations are capital intensive, characterized by significant investments in aircraft, vehicles, technology, facilities, and package-handling and sort equipment. The amount and timing of capital additions depend on various factors, including pre-existing contractual commitments, anticipated volume growth, domestic and international economic conditions, new or enhanced services, geographical expansion of services, availability of satisfactory financing and actions of regulatory authorities.

The following table compares capital expenditures by asset category and reportable segment for the three-month periods ended August 31 (in millions):

	2015		2014		Dollar Change			Percent Change
Aircraft and related equipment	$	622	$	299	$	323			108
Facilities and sort equipment		249		147		102			69
Vehicles		220		129		91			71
Information and technology investments		71		74		(3	)		(4	)
Other equipment		47		71		(24	)		(34	)
Total capital expenditures	$	1,209	$	720	$	489			68
FedEx Express segment		834		467		367			79
FedEx Ground segment		221		140		81			58
FedEx Freight segment		63		36		27			75
FedEx Services segment		91		77		14			18
Total capital expenditures	$	1,209	$	720	$	489			68

Capital expenditures during the first quarter of 2016 were higher than the prior-year period primarily due to increased spending for aircraft at FedEx Express. Aircraft and related equipment purchases at FedEx Express during the first quarter of 2016 included the delivery of five Boeing 767-300 Freighter (“B767F”) aircraft and one Boeing 777 Freighter aircraft, as well as the modification of certain aircraft before being placed into service.

LIQUIDITY OUTLOOK

We believe that our cash and cash equivalents, cash flow from operations and available financing sources are adequate to meet our liquidity needs, including working capital, capital expenditure requirements and debt payment obligations. Our cash and cash equivalents balance at August 31, 2015 includes $448 million of cash in offshore jurisdictions associated with our permanent reinvestment strategy. We do not believe that the indefinite reinvestment of these funds offshore impairs our ability to meet our domestic debt or working capital obligations. Although we expect higher capital expenditures in 2016, we anticipate that our cash flow from operations will be sufficient to fund these expenditures. Historically, we have been successful in obtaining unsecured financing, from both domestic and international sources, although the marketplace for such investment capital can become restricted depending on a variety of economic factors.

Our capital expenditures are expected to be approximately $4.6 billion in 2016 and include spending for aircraft and aircraft-related equipment at FedEx Express, sort facility expansion, primarily at FedEx Ground, and vehicle replacement at all our transportation segments. We invested $622 million in aircraft and aircraft-related equipment in the first quarter of 2016 and expect to invest an additional $0.9 billion for aircraft and aircraft-related equipment during the remainder of 2016.

On July 21, 2015, FedEx Express entered into a supplemental agreement to purchase 50 additional B767F aircraft from Boeing. Four of the 50 additional B767F aircraft purchases are conditioned upon there being no event that causes FedEx Express or its employees not to be covered by the Railway Labor Act of 1926, as amended. The 50 additional B767F aircraft are expected to be delivered from fiscal 2018 through fiscal 2023 and will enable FedEx Express to continue to improve the efficiency and reliability of its aircraft fleet.

- 43 -

In September 2015, we expect to file a new shelf registration statement with the Securities and Exchange Commission (“SEC”) that will allow us to sell, in one or more future offerings, any combination of our unsecured debt securities and common stock.

We plan to finance the aggregate consideration of the announced intent to acquire TNT Express by utilizing available cash on our balance sheet and through available financing sources.

A $1 billion revolving credit facility is available to finance our operations and other cash flow needs and to provide support for the issuance of commercial paper. We are in compliance with all the covenants of our revolving credit agreement and do not expect the covenants to affect our operations, including our liquidity or expected funding needs. As of August 31, 2015, no commercial paper was outstanding and the entire $1 billion under the revolving credit facility was available for future borrowings. See Note 3 and our Annual Report for a description of the term and significant covenants of our revolving credit facility.

In September 2015, we made $165 million in required contributions to our tax-qualified U.S. domestic pension plans (“U.S. Pension Plans”). Our U.S. Pension Plans have ample funds to meet expected benefit payments. For the remainder of 2016, we have $330 million in required contributions to our U.S. Pension Plans.

Standard & Poor’s has assigned us a senior unsecured debt credit rating of BBB and commercial paper rating of A-2 and a ratings outlook of “stable.” Moody’s Investors Service has assigned us a senior unsecured debt credit rating of Baa1 and commercial paper rating of P-2 and a ratings outlook of “negative.” If our credit ratings drop, our interest expense may increase. If our commercial paper ratings drop below current levels, we may have difficulty utilizing the commercial paper market. If our senior unsecured debt credit ratings drop below investment grade, our access to financing may become limited.

- 44 -

CONTRACTUAL CASH OBLIGATIONS AND OFF-BALANCE SHEET ARRANGEMENTS

The following table sets forth a summary of our contractual cash obligations as of August 31, 2015. Certain of these contractual obligations are reflected in our balance sheet, while others are disclosed as future obligations under accounting principles generally accepted in the United States. Except for the current portion of interest on long-term debt, this table does not include amounts already recorded in our balance sheet as current liabilities at August 31, 2015. We have certain contingent liabilities that are not accrued in our balance sheet in accordance with accounting principles generally accepted in the United States. These contingent liabilities are not included in the table below. We have other long-term liabilities reflected in our balance sheet, including deferred income taxes, qualified and nonqualified pension and postretirement healthcare plan liabilities and other self-insurance accruals. The payment obligations associated with these liabilities are not reflected in the table below due to the absence of scheduled maturities. Accordingly, this table is not meant to represent a forecast of our total cash expenditures for any of the periods presented.

	Payments Due by Fiscal Year (Undiscounted) (in millions)
	2016 (1)		2017		2018		2019		2020		Thereafter		Total
Operating activities:
Operating leases	$	1,686	$	2,293	$	1,804	$	1,560	$	1,316	$	7,714	$	16,373
Non-capital purchase obligations and other		316		258		148		70		22		90		904
Interest on long-term debt		173		320		320		320		260		5,331		6,724
Quarterly contributions to our U.S. Pension Plans		495		—		—		—		—		—		495
Investing activities:
Aircraft and aircraft-related capital commitments		657		1,240		1,739		1,584		1,638		5,962		12,820
Other capital purchase obligations		5		6		1		1		1		8		22
Financing activities:
Debt		—		—		—		750		400		6,090		7,240
Total	$	3,332	$	4,117	$	4,012	$	4,285	$	3,637	$	25,195	$	44,578

⁽¹⁾ Cash obligations for the remainder of 2016.

Open purchase orders that are cancelable are not considered unconditional purchase obligations for financial reporting purposes and are not included in the table above. Such purchase orders often represent authorizations to purchase rather than binding agreements. See Note 7 of the accompanying unaudited condensed consolidated financial statements for more information.

Operating Activities

The amounts reflected in the table above for operating leases represent future minimum lease payments under noncancelable operating leases (principally aircraft and facilities) with an initial or remaining term in excess of one year at August 31, 2015.

Included in the table above within the caption entitled “Non-capital purchase obligations and other” is our estimate of the current portion of the liability ($1 million) for uncertain tax positions and amounts for purchase obligations that represent noncancelable agreements to purchase goods or services that are not capital related. Such contracts include those for printing and advertising and promotions contracts. We cannot reasonably estimate the timing of the long-term payments or the amount by which the liability for uncertain tax positions will increase or decrease over time; therefore, the long-term portion of the liability for uncertain tax positions ($30 million) is excluded from the table.

The amounts reflected in the table above for interest on long-term debt represent future interest payments due on our long-term debt, all of which are fixed rate.

- 45 -

We had $411 million in deposits and progress payments as of August 31, 2015 on aircraft purchases and other planned aircraft-related transactions.

Investing Activities

The amounts reflected in the table above for capital purchase obligations represent noncancelable agreements to purchase capital-related equipment. Such contracts include those for certain purchases of aircraft, aircraft modifications, vehicles, facilities, computers and other equipment.

Financing Activities

The amounts reflected in the table above for long-term debt represent future scheduled payments on our long-term debt. For the remainder of 2016, we have no scheduled principal debt payments.

Additional information on amounts included within the operating, investing and financing activities captions in the table above can be found in our Annual Report.

CRITICAL ACCOUNTING ESTIMATES

The preparation of financial statements in accordance with accounting principles generally accepted in the United States requires management to make significant judgments and estimates to develop amounts reflected and disclosed in the financial statements. In many cases, there are alternative policies or estimation techniques that could be used. We maintain a thorough process to review the application of our accounting policies and to evaluate the appropriateness of the many estimates that are required to prepare the financial statements of a complex, global corporation. However, even under optimal circumstances, estimates routinely require adjustment based on changing circumstances and new or better information.

GOODWILL. Goodwill is tested for impairment between annual tests whenever events or circumstances make it more likely than not that the fair value of a reporting unit has fallen below its carrying value. We do not believe there has been any change of events or circumstances that would indicate that a reevaluation of the goodwill of our reporting units is required as of August 31, 2015, nor do we believe the goodwill of our reporting units is at risk of failing impairment testing. For additional details on goodwill impairment testing, refer to Note 1 of our Annual Report.

Information regarding our critical accounting estimates can be found in our Annual Report, including Note 1 to the financial statements therein. Management has discussed the development and selection of these critical accounting estimates with the Audit Committee of our Board of Directors and with our independent registered public accounting firm.

FORWARD-LOOKING STATEMENTS

Certain statements in this report, including (but not limited to) those contained in “Outlook,” “Liquidity,” “Capital Resources,” “Liquidity Outlook,” “Contractual Cash Obligations” and “Critical Accounting Estimates,” and the “General,” “Retirement Plans,” and “Contingencies” notes to the consolidated financial statements, are “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to our financial condition, results of operations, cash flows, plans, objectives, future performance and business. Forward-looking statements include those preceded by, followed by or that include the words “may,” “could,” “would,” “should,” “believes,” “expects,” “anticipates,” “plans,” “estimates,” “targets,” “projects,” “intends” or similar expressions. These forward-looking statements involve risks and uncertainties. Actual results may differ materially from those contemplated (expressed or implied) by such forward-looking statements, because of, among other things, potential risks and uncertainties, such as:

• economic conditions in the global markets in which we operate;

- 46 -

• significant changes in the volumes of shipments transported through our networks, customer demand for our various services or the prices we obtain for our services;

• damage to our reputation or loss of brand equity;

• cybersecurity incidents or disruptions to the Internet or our technology infrastructure, including those impacting our computer systems and website, which can adversely affect our operations and reputation among customers;

• the price and availability of jet and vehicle fuel;

• our ability to manage our cost structure for capital expenditures and operating expenses, and match it to shifting and future customer volume levels;

• the impact of intense competition on our ability to maintain or increase our prices (including our fuel surcharges in response to fluctuating fuel price) or to maintain or grow our market share;

• our ability to successfully execute the TNT Express acquisition on favorable terms, a timely basis or at all;

• our ability to effectively operate, integrate, leverage and grow acquired businesses, and to continue to support the value we allocate to these acquired businesses, including their goodwill;

• our ability to maintain good relationships with our employees and prevent attempts by labor organizations to organize groups of our employees, which could significantly increase our operating costs and reduce our operational flexibility;

• the impact of costs related to (i) challenges to the status of FedEx Ground’s owner-operators as independent contractors, rather than employees, and (ii) any related changes to our relationship with these owner-operators;

• our ability to execute on our profit improvement programs;

• the impact of any international conflicts or terrorist activities on the United States and global economies in general, the transportation industry or us in particular, and what effects these events will have on our costs or the demand for our services;

• any impacts on our businesses resulting from new domestic or international government laws and regulation, including regulatory actions affecting global aviation or other transportation rights, increased air cargo and other security or safety requirements, and tax, accounting, trade (such as protectionist measures enacted in response to weak economic conditions), labor (such as card-check legislation or changes to the Railway Labor Act affecting FedEx Express employees), environmental (such as global climate change legislation) or postal rules;

• adverse weather conditions or localized natural disasters in key geographic areas, such as earthquakes, volcanoes, and hurricanes, which can disrupt our electrical service, damage our property, disrupt our operations, increase our fuel costs and adversely affect our shipment levels;

• any impact on our business from disruptions or modifications in service by the USPS, which is a significant customer and vendor of FedEx;

• increasing costs, the volatility of costs and funding requirements and other legal mandates for employee benefits, especially pension and healthcare benefits;

- 47 -

• the increasing costs of compliance with federal, state and foreign governmental agency mandates (including the Foreign Corrupt Practices Act and the U.K. Bribery Act) and defending against inappropriate or unjustified enforcement or other actions by such agencies;

• changes in foreign currency exchange rates, especially in the Chinese yuan, euro, British pound, Brazilian real and the Canadian dollar, which can affect our sales levels and foreign currency sales prices;

• market acceptance of our new service and growth initiatives;

• any liability resulting from and the costs of defending against class-action litigation, such as wage-and-hour and discrimination and retaliation claims, and any other legal or governmental proceedings;

• the outcome of future negotiations to reach new collective bargaining agreements — including with the union that represents the pilots of FedEx Express;

• the impact of technology developments on our operations and on demand for our services, and our ability to continue to identify and eliminate unnecessary information technology redundancy and complexity throughout the organization;

• governmental underinvestment in transportation infrastructure, which could increase our costs and adversely impact our service levels due to traffic congestion or sub-optimal routing of our vehicles and aircraft;

• widespread outbreak of an illness or any other communicable disease, or any other public health crisis;

• availability of financing on terms acceptable to us and our ability to maintain our current credit ratings, especially given the capital intensity of our operations; and

• other risks and uncertainties you can find in our press releases and SEC filings, including the risk factors identified under the heading “Risk Factors” in “Management’s Discussion and Analysis of Results of Operations and Financial Condition” in our Annual Report, as updated by our quarterly reports on Form 10-Q.

As a result of these and other factors, no assurance can be given as to our future results and achievements. Accordingly, a forward-looking statement is neither a prediction nor a guarantee of future events or circumstances and those future events or circumstances may not occur. You should not place undue reliance on the forward-looking statements, which speak only as of the date of this report. 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.

- 48 -

Item 3. Quantitative and Qualitative Disclosures About Market Risk

As of August 31, 2015, there had been no material changes in our market risk sensitive instruments and positions since our disclosures in our Annual Report.

The principal foreign currency exchange rate risks to which we are exposed are in the Chinese yuan, euro, British pound, Brazilian real, Mexican peso and the Canadian dollar. Historically, our exposure to foreign currency fluctuations is more significant with respect to our revenues than our expenses, as a significant portion of our expenses are denominated in U.S. dollars, such as aircraft and fuel expenses. During the first three months of 2016, the U.S. dollar strengthened relative to the currencies of the foreign countries in which we operate as compared to May 31, 2015, and this strengthening had a slightly positive impact on our results.

While we have market risk for changes in the price of jet and vehicle fuel, this risk is largely mitigated by our indexed fuel surcharges. For additional discussion of our indexed fuel surcharges see the “Fuel” section of “Management’s Discussion and Analysis of Results of Operations and Financial Condition.”

Item 4. Controls and Procedures

The management of FedEx, with the participation of our principal executive and financial officers, has evaluated the effectiveness of our disclosure controls and procedures in ensuring that the information required to be disclosed in our filings under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, including ensuring that such information is accumulated and communicated to FedEx management as appropriate to allow timely decisions regarding required disclosure. Based on such evaluation, our principal executive and financial officers have concluded that such disclosure controls and procedures were effective as of August 31, 2015 (the end of the period covered by this Quarterly Report on Form 10-Q).

During our fiscal quarter ended August 31, 2015, no change occurred in our internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

- 49 -

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

For a description of all material pending legal proceedings, see Note 8 of the accompanying unaudited condensed consolidated financial statements.

Item 1A. Risk Factors

There have been no material changes from the risk factors disclosed in our Annual Report (under the heading “Risk Factors” in “Management’s Discussion and Analysis of Results of Operations and Financial Condition”) in response to Part I, Item 1A of Form 10-K.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

The following table provides information on FedEx’s repurchases of our common stock during the first quarter of 2016:

ISSUER PURCHASES OF EQUITY SECURITIES

Period	Total Number of Shares  Purchased		Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Programs		Maximum Number of Shares That May Yet Be Purchased Under the Programs
June 1-30, 2015		475,000	$	176.44		475,000		11,725,000
July 1-31, 2015		425,000		171.35		425,000		11,300,000
Aug. 1-31, 2015		200,000		164.52		200,000		11,100,000
Total		1,100,000	$	172.30		1,100,000

The repurchases above were made under a share repurchase program that was approved by our Board of Directors and announced on September 29, 2014, and through which we are authorized to purchase, in the open market or in privately negotiated transactions, up to an aggregate of 15 million shares of our common stock. As of September 16, 2015, 11.1 million shares remained authorized for purchase under the September 2014 stock repurchase program, which is the only such program that currently exists. The program does not have an expiration date.

Item 6. Exhibits

Exhibit     Number	Description of Exhibit
2.1	Addendum to the Irrevocable Undertaking, dated as of August 14, 2015, between FedEx Corporation and PostNL N.V.
10.1	Amendment dated June 12, 2015 (but effective as of January 5, 2015), amending the Transportation Agreement dated April 23, 2013 between the United States Postal Service and Federal Express Corporation. Confidential treatment has been requested for confidential commercial and financial information, pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.
10.2	Amendment dated June 16, 2015 (but effective as of February 2, 2015), amending the Transportation Agreement dated April 23, 2013 between the United States Postal Service and Federal Express Corporation. Confidential treatment has been requested for confidential commercial and financial information, pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

- 50 -

10.3	Amendment dated June 23, 2015 (but effective as of March 2, 2015), amending the Transportation Agreement dated April 23, 2013 between the United States Postal Service and Federal Express Corporation. Confidential treatment has been requested for confidential commercial and financial information, pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.
10.4	Amendment dated August 31, 2015 (but effective as of January 4, 2016), amending the Transportation Agreement dated April 23, 2013 between the United States Postal Service and Federal Express Corporation. Confidential treatment has been requested for confidential commercial and financial information, pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.
10.5	Supplemental Agreement No. 6 (and related side letters) dated as of July 21, 2015, amending the Boeing 767-3S2 Freighter Purchase Agreement dated as of December 14, 2011, between The Boeing Company and Federal Express Corporation. Confidential treatment has been requested for confidential commercial and financial information, pursuant to Rule 24b-2 under the Securities and Exchange Act of 1934, as amended.
10.6	Class Action Settlement Agreement between Dean Alexander, Peter Allen, Albert Anaya, Suzanne Andrade, Jerrett Henderson, Ely Ines, Paul Infantino, Jorge Isla, Eric Jeppson, Gupertino Magana, Bernard Mendoza, Jesse Padilla, Joey Rodriguez, Dale Rose, Allan Ross, Agostino Scalercio, and Anthony Ybarra, on behalf of themselves, the Certified Class, and the Certified Sub-Class, and Defendant FedEx Ground Package System, Inc.
12.1	Computation of Ratio of Earnings to Fixed Charges.
15.1	Letter re: Unaudited Interim Financial Statements.
31.1	Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.1	Interactive Data Files.

- 51 -

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	FEDEX CORPORATION
Date: September 17, 2015	/s/ JOHN L. MERINO
	JOHN L. MERINO
	CORPORATE VICE PRESIDENT AND
	PRINCIPAL ACCOUNTING OFFICER

- 52 -

EXHIBIT INDEX

Exhibit     Number	Description of Exhibit
2.1	Addendum to the Irrevocable Undertaking, dated as of August 14, 2015, between FedEx Corporation and PostNL N.V.
10.1	Amendment dated June 12, 2015 (but effective as of January 5, 2015), amending the Transportation Agreement dated April 23, 2013 between the United States Postal Service and Federal Express Corporation. Confidential treatment has been requested for confidential commercial and financial information, pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.
10.2	Amendment dated June 16, 2015 (but effective as of February 2, 2015), amending the Transportation Agreement dated April 23, 2013 between the United States Postal Service and Federal Express Corporation. Confidential treatment has been requested for confidential commercial and financial information, pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.
10.3	Amendment dated June 23, 2015 (but effective as of March 2, 2015), amending the Transportation Agreement dated April 23, 2013 between the United States Postal Service and Federal Express Corporation. Confidential treatment has been requested for confidential commercial and financial information, pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.
10.4	Amendment dated August 31, 2015 (but effective as of January 4, 2016), amending the Transportation Agreement dated April 23, 2013 between the United States Postal Service and Federal Express Corporation. Confidential treatment has been requested for confidential commercial and financial information, pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.
10.5	Supplemental Agreement No. 6 (and related side letters) dated as of July 21, 2015, amending the Boeing 767-3S2 Freighter Purchase Agreement dated as of December 14, 2011, between The Boeing Company and Federal Express Corporation. Confidential treatment has been requested for confidential commercial and financial information, pursuant to Rule 24b-2 under the Securities and Exchange Act of 1934, as amended.
10.6	Class Action Settlement Agreement between Dean Alexander, Peter Allen, Albert Anaya, Suzanne Andrade, Jerrett Henderson, Ely Ines, Paul Infantino, Jorge Isla, Eric Jeppson, Gupertino Magana, Bernard Mendoza, Jesse Padilla, Joey Rodriguez, Dale Rose, Allan Ross, Agostino Scalercio, and Anthony Ybarra, on behalf of themselves, the Certified Class, and the Certified Sub-Class, and Defendant FedEx Ground Package System, Inc.
12.1	Computation of Ratio of Earnings to Fixed Charges.
15.1	Letter re: Unaudited Interim Financial Statements.
31.1	Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

E-1

31.2	Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.1	Interactive Data Files.

E-2

EX-2.1

Exhibit 2.1

Execution copy

ADDENDUM TO THE IRREVOCABLE UNDERTAKING

This addendum (the Addendum) is entered into on 14 August 2015 between:

1. FedEx Corporation, a public company organised under the laws of the State of Delaware, having its registered office at 1209 Orange Street, Wilmington, DE 19801, United States of America (FedEx); and

2. PostNL N.V., a public company incorporated under the laws of the Netherlands, having its statutory seat at ‘s-Gravenhage, the Netherlands and its address at Prinses Beatrixlaan 23, 2595 AK ‘s-Gravenhage, the Netherlands (PostNL),

FedEx and PostNL are hereinafter also individually referred to as a Party and collectively as the Parties.

WHEREAS

A. On 6 April 2015, FedEx and PostNL entered into an irrevocable undertaking in relation to the intended public offer by FedEx for the entire issued share capital of TNT Express N.V. as first announced on 7 April 2015 (the Irrevocable).

B. As the intended launch date of the Offer is postponed the Parties wish to confirm the existence of the Irrevocable and to amend certain dates set out in the Irrevocable in connection with the revised Offer launch date.

THE PARTIES NOW HEREBY AGREE AS FOLLOWS

1 IRREVOCABLE UNDERTAKING

1.1 Confirmation and amendment

The Parties confirm the continued existence of the Irrevocable as of the date of its signing on 6 April 2015 and hereby agree that Clause 6.1.2 header and subparagraph (b) of the Irrevocable is amended and will read as follows:

“In addition to clause 6.1.1 and subject to clause 6.1.3, this Agreement shall terminate immediately (without prejudice to accrued rights and/or liabilities arising from the prior breach of this Agreement) if:

(…)

2

b. the Offer Document is not published and the Offer is not commenced ultimately on 31 August 2015; or

(…) ”

1.2 Confirmation

Subject to the amended terms and conditions of the Irrevocable pursuant to Clause 1.1, the Parties confirm and acknowledge that the Parties are and remain bound by the terms and conditions of the Irrevocable and that the Irrevocable is in full force and effect.

1.3 TNT

TNT Express N.V. will sign this Addendum for acknowledgement and agreement.

1.4 Integral part

This Agreement forms an integral part of the Irrevocable as amended hereby and, where appropriate, any reference to the Irrevocable will also be a reference to this Addendum and vice versa. Articles 8 (Notices), 9 (Miscellaneous) and 10 (Governing law and jurisdiction) of the Irrevocable apply to this Addendum mutatis mutandis.

— signature page follows —

3

Signature page to Addendum to Irrevocable

This Addendum has been signed on the date stated at the beginning.

For and on behalf of
FedEx Corporation
/s/ Christine P. Richards
By:	Christine P. Richards
Title:	Executive Vice President,
	General Counsel and Secretary
For and on behalf of
PostNL N.V.
/s/ Jan Bos
By:	Jan Bos
Title:	CFO
For and on behalf of TNT Express N.V. for the sole purpose of reconfirming its commitment to clauses 2.3 and 2.4 of the Irrevocable		For and on behalf of TNT Express N.V. for the sole purpose of reconfirming its commitment to clauses 2.3 and 2.4 of the Irrevocable
/s/ L. W. Gunning		/s/ M. J. de Vries
By:	14 - 08 - 2015	By:	M. J. de Vries
Title:	Chief Exec. Officer	Title:	CFO

EX-10.1

Exhibit 10.1

AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT   1. CONTRACT ID CODE     PAGE OF   1        3

2. AMENDMENT/MODIFICATION NO. 032	3. EFFECTIVE DATE   01/05/2015	4. REQUISITION/PURCHASE REQ. NO.	5. PROJECT NO. (If applicable)
6. ISSUED BY                             CODE	5ASNET	7. ADMINISTERED BY (IF OTHER THAN ITEM 6)	CODE	5ASNET
ALAINA EARL Air Transportation CMC United States Postal Service 475 L’Enfant Plaza SW Room 1P 650 Washington DC 20260-0650 (202) 268-6580		Air Transportation CMC Air Transportation CMC United States Postal Service 475 L’Enfant Plaza SW, Room 1P650 Washington DC 20260-0650

8. NAME AND ADDRESS OF CONTRACTOR (No., Street, County, State, and Zip Code) FEDERAL EXPRESS CORPORATION 3610 HACKS CROSS ROAD MEMPHIS TN 38125-8800		(x)	9A. AMENDMENT OF SOLICITATION NO.
			9B. DATED (SEE ITEM 11)
		x	10A. MODIFICATION OF CONTRACT/ORDER NO. ACN-13-FX
			10B. DATED (SEE ITEM 13) 04/23/2013
SUPPLIER CODE:      000389122	FACILITY CODE

11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS

¨     ¨  is extended,         ¨  is not extended.

Offers must acknowledge receipt of this amendment prior to the hour and date specified in the solicitation or as amended, by one of the following methods:

(a) By completing items 8 and 15, and returning                  copies of the amendment; (b) By acknowledging receipt of this amendment on each copy of the offer submitted; or (c) By separate letter or telegram which includes a reference to the solicitation and amendment number. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this amendment you desire to change an offer already submitted, such change may be made by telegram or letter, provided each telegram or letter makes reference to the solicitation and this amendment, and is received prior to the opening hour and date specified.

12.    ACCOUNTING AND APPROPRIATION DATA      (If Required)          See Schedule Net Increase: [*]            

13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS. IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.

(x)	A.	THIS CHANGE BY CLAUSE IS ISSUED PURSUANT TO: (Specify Clause) THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO. IN ITEM 10A.
¨
¨	B.	THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE ADMINISTRATIVE CHANGES (such as changes in paying office, appropriation date, etc.) SET FORTH IN ITEM 14.
¨	C.	THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF: THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO. IN ITEM 10A.
x	D.	OTHER (such as no cost change/cancellation, termination, etc.) (Specify type of modification and authority): THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO. IN ITEM 10A. By Mutual Agreement of the Contracting Parties

E. IMPORTANT:     Contractor ¨ is not, x is required to sign this document and return          1           copies to the issuing office.

14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section headings, including solicitation/contract subject matter where feasible.)

In accordance with contract ACN-13-FX and the “Fuel Adjustment” section, the following Line Haul Rate (fuel) for the Day Network as set out in Attachment 10 is modified for performance during the period of January 5, 2015 to February 1, 2015 (Operating Period 16) as follows:

From:

[*] per cubic foot

To:

[*] per cubic foot

Continued...

Except as provided herein, all terms and conditions of the document referenced in Item 9A or 10A, as heretofore changed, remains unchanged and in full force and effect.

15A. NAME AND TITLE OF SIGNER (Type or print)   Paul J. Herron, Vice President 16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)       Brian Mckain

15B. CONTRACTOR/OFFEROR   /s/ PAUL J. HERRON (Signature of person authorized to sign) 15C. DATE SIGNED   06/11/15 16B. CONTRACT AUTHORITY       /s/ BRIAN MCKAIN (Signature of Contracting Officer) 16C. DATE SIGNED   06/12/15

*Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

CONTINUATION SHEET REQUISITION NO.                      Page Of 2         3

CONTRACT/ORDER NO. ACN-13-FX/032 AWARD/ EFFECTIVE DATE   01/05/2015 MASTER/AGENCY CONTRACT NO SOLICITATION NO. SOLICITATION ISSUE DATE

ITEM NO.	SCHEDULE OF SUPPLIES / SERVICES	QUANTITY	UNIT	UNIT PRICE	AMOUNT
	This is a decrease of [*]. [*] This modification also incorporates Operating Period 19 (April) Scheduled Charters into the ACN-13-FX contract, with the following conditions: A) Once the Charters are scheduled they cannot be canceled. B) All Service and Scan penalties (reductions in payment) will be eliminated for Operating Period 19 in which these “Scheduled Charters” will operate. C) Volume will be inducted into the network at the Memphis Hub and will incur appropriate tier pricing and will be processed normally. FedEx will notify the Postal Service if the Tender requirement is different than what is currently in the contract. Delivery does not change. Payments for said charters will be paid as part of the Operating Period reconciliation. Sub Rept Req’d: Y Carrier Code: FX Route Termini S: Various Route Termini End: Various Payment Terms: SEE CONTRACT Discount Terms: See Schedule Accounting Info: BFN: 670167 FOB: Destination Period of Performance: 12/01/2014 to 09/30/2020 Change Item 00001 to read as follows:
00001	Day Network
	Account Number: 53503 Continued...				[*]

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

CONTINUATION SHEET REQUISITION NO.                      PAGE OF 3         3

CONTRACT/ORDER NO. ACN-13-FX/032 AWARD/ EFFECTIVE DATE   01/05/2015 MASTER/AGENCY CONTRACT NO. SOLICITATION NO. SOLICITATION ISSUE DATE

ITEM NO.	SCHEDULE OF SUPPLIES / SERVICES	QUANTITY	UNIT	UNIT PRICE	AMOUNT
00007	Delivery: 12/01/2014 Delivery Location Code: 18310M WASHINGTON D DC NOM WASHINGTON DC NOM USPS 475 LENFANT PLZ SW RM 6631 WASHINGTON DC 202606631 Amount: [*] Add Item 00007 as follows: Scheduled Charter Option	4	WK	[*]	[*]
	Account Number: 53703 Delivery: 03/30/2015 Delivery Location Code: 18310M USPS SHARED NETWORKS 475 LENFANT PLZ SW RM 7900 WASHINGTON DC 20260-6631 The amount listed is an average weekly amount.

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

FedEx Scheduled Charters-USPS April Operating Period

TUE

WED

THU

FRI

SAT

SUN

Weekly Total

Aircraft

Rate

Weekly Rate

MTD Rate

Location

Days operated

Cubic Feet

EWR

TUES,THU,SAT

[*]

[*]

[*]

[*]

[*]

[*]

[*]

MD-10

[*]

[*]

[*]

FLL

TUES, THU

[*]

[*]

[*]

[*]

[*]

[*]

[*]

757

[*]

[*]

[*]

LAX

SAT

[*]

[*]

[*]

[*]

[*]

[*]

[*]

MD-10

[*]

[*]

[*]

LAX

SUN

[*]

[*]

[*]

[*]

[*]

[*]

[*]

MD-11

[*]

[*]

[*]

SLC

TUES, THU,SAT

[*]

[*]

[*]

[*]

[*]

[*]

[*]

757

[*]

[*]

[*]

PHL

TUES,THU

[*]

[*]

[*]

[*]

[*]

[*]

[*]

757

[*]

[*]

[*]

TPA

SUN

[*]

[*]

[*]

[*]

[*]

[*]

[*]

757

[*]

[*]

[*]

LAX

Tues

[*]

[*]

[*]

[*]

[*]

[*]

[*]

757

[*]

[*]

[*]

LAX

Wed (04/01/15 & 04/08/15 only)

[*]

[*]

[*]

[*]

[*]

[*]

[*]

757

[*]

[*]

[*]

Day and Weekly Total

[*]

[*]

[*]

[*]

[*]

[*]

[*]

[*]

[*]

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

EX-10.2

Exhibit 10.2

AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT   1. CONTRACT ID CODE     PAGE OF   1        3

2. AMENDMENT/MODIFICATION NO. 033	3. EFFECTIVE DATE   02/02/2015	4. REQUISITION/PURCHASE REQ. NO.	5. PROJECT NO. (If applicable)
6. ISSUED BY                         CODE	5ASNET	7. ADMINISTERED BY (IF OTHER THAN ITEM 6)	CODE	5ASNET
ALAINA EARL Air Transportation CMC United States Postal Service 475 L’Enfant Plaza SW Room 1P 650 Washington DC 20260-0650 (202) 268-6580		Air Transportation CMC Air Transportation CMC United States Postal Service 475 L’Enfant Plaza SW, Room 1P650 Washington DC 20260-0650

8. NAME AND ADDRESS OF CONTRACTOR (No., Street, County, State, and Zip Code) FEDERAL EXPRESS CORPORATION 3610 HACKS CROSS ROAD MEMPHIS TN 38125-8800		(x)	9A. AMENDMENT OF SOLICITATION NO.
			9B. DATED (SEE ITEM 11)
		x	10A. MODIFICATION OF CONTRACT/ORDER NO. ACN-13-FX
			10B. DATED (SEE ITEM 13) 04/23/2013
SUPPLIER CODE:        000389122	FACILITY CODE

11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS

¨     ¨  is extended,         ¨  is not extended.

Offers must acknowledge receipt of this amendment prior to the hour and date specified in the solicitation or as amended, by one of the following methods:

(a) By completing items 8 and 15, and returning                  copies of the amendment; (b) By acknowledging receipt of this amendment on each copy of the offer submitted; or (c) By separate letter or telegram which includes a reference to the solicitation and amendment number. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this amendment you desire to change an offer already submitted, such change may be made by telegram or letter, provided each telegram or letter makes reference to the solicitation and this amendment, and is received prior to the opening hour and date specified.

12.    ACCOUNTING AND APPROPRIATION DATA      (If Required)          See Schedule Net Increase:        [*]             

13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS. IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.

(x)	A.	THIS CHANGE BY CLAUSE IS ISSUED PURSUANT TO: (Specify Clause) THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO. IN ITEM 10A.
¨
¨	B.	THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE ADMINISTRATIVE CHANGES (such as changes in paying office, appropriation date, etc.) SET FORTH IN ITEM 14.
¨	C.	THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF: THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO. IN ITEM 10A.
x	D.	OTHER (such as no cost change/cancellation, termination, etc.) (Specify type of modification and authority): THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO. IN ITEM 10A By Mutual Agreement of the Contracting Parties

E. IMPORTANT:     Contractor ¨ is not, x is required to sign this document and return          1           copies to the issuing office.

14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section headings, including solicitation/contract subject matter where feasible.)

In accordance with contract ACN-13-FX and the “Fuel Adjustment” section, the following Line Haul Rate (fuel) for the Day Network as set out in Attachment 10 is modified for performance during the period of February 2, 2015 to March 1, 2015 (Operating Period 17) as follows:

From:

[*] per cubic foot

To:

[*] per cubic foot

Continued...

Except as provided herein, all terms and conditions of the document referenced in Item 9A or 10A, as heretofore changed, remains unchanged and in full force and effect.

15A. NAME AND TITLE OF SIGNER (Type or print)   Paul J. Herron, Vice President 16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)       Brian Mckain

15B. CONTRACTOR/OFFEROR   /s/ PAUL J. HERRON (Signature of person authorized to sign) 15C. DATE SIGNED   06/15/15 16B. CONTRACT AUTHORITY       /s/ BRIAN MCKAIN (Signature of Contracting Officer) 16C. DATE SIGNED   06/16/15

*Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

CONTINUATION SHEET REQUISITION NO.                      Page Of 2       3

CONTRACT/ORDER NO. ACN-13-FX/033 AWARD/ EFFECTIVE DATE   02/02/2015 MASTER/AGENCY CONTRACT NO SOLICITATION NO. SOLICITATION ISSUE DATE

ITEM NO.	SCHEDULE OF SUPPLIES / SERVICES	QUANTITY	UNIT	UNIT PRICE	AMOUNT
1	This is a decrease of [*]. [*] This modification also incorporates Operating Period 20 (May) Scheduled Charters into the ACN-13-FX contract, with the following conditions: A) Once the Charters are scheduled they cannot be canceled. B) All Service and Scan penalties (reductions in payment) will be eliminated for Operating Period 20 in which these “Scheduled Charters” will operate. C) Volume will be inducted into the network at the Memphis Hub and will incur appropriate tier pricing and will be processed normally. FedEx will notify the Postal Service if the Tender requirement is different than what is currently in the contract. Delivery does not change. Payments for said charters will be paid as part of the Operating Period reconciliation. Sub Rept Req’d: Y Carrier Code: FX Route Termini S: Various Route Termini End: Various Payment Terms: SEE CONTRACT Discount Terms: See Schedule Accounting Info: BFN: 670167 FOB: Destination Period of Performance: 12/01/2014 to 09/30/2020 Change Item 1 to read as follows: Day Network Account Number: 53503 Delivery: 12/01/2014 Continued...				[*]

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

CONTINUATION SHEET REQUISITION NO.                      PAGE OF 3         3

CONTRACT/ORDER NO. ACN-13-FX/033 AWARD/ EFFECTIVE DATE   02/02/2015 MASTER/AGENCY CONTRACT NO. SOLICITATION NO. SOLICITATION ISSUE DATE

ITEM NO.	SCHEDULE OF SUPPLIES / SERVICES	QUANTITY	UNIT	UNIT PRICE	AMOUNT
7	Delivery Location Code: 18310M WASHINGTON D DC NOM WASHINGTON DC NOM USPS 475 LENFANT PLZ SW RM 6631 WASHINGTON DC 202606631 Amount: [*] Change Item 7 to read as follows: Scheduled Charter Option Account Number: 53703 Delivery: 03/30/2015 Delivery Location Code: 18310M USPS SHARED NETWORKS 475 LENFANT PLZ SW RM 7900 WASHINGTON DC 20260-6631 Amount: [*]				[*]

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

FedEx Scheduled Charters-USPS May Operating Period

Weeks 1-4

Location

Days operated

Cubic Feet available

TUE

WED

THU

FRI

SAT

SUN

Weekly Total

Aircraft

RATE

Weekly Rate

O/P Rate

EWR

TUES, THUR, SAT

[*]

[*]

[*]

[*]

[*]

[*]

[*]

MD-10

[*]

[*]

[*]

FLL

TUES, SAT

[*]

[*]

[*]

[*]

[*]

[*]

[*]

757

[*]

[*]

[*]

LAX

WED

[*]

[*]

[*]

[*]

[*]

[*]

[*]

757

[*]

[*]

[*]

LAX

SAT

[*]

[*]

[*]

[*]

[*]

[*]

[*]

MD-10

[*]

[*]

[*]

LAX

SUN

[*]

[*]

[*]

[*]

[*]

[*]

[*]

MD-11

[*]

[*]

[*]

SLC

TUES, THUR, SAT

[*]

[*]

[*]

[*]

[*]

[*]

[*]

757

[*]

[*]

[*]

PHL

WED, SAT

[*]

[*]

[*]

[*]

[*]

[*]

[*]

757

[*]

[*]

[*]

TPA

SUN

[*]

[*]

[*]

[*]

[*]

[*]

[*]

757

[*]

[*]

[*]

IAD

SUN (Weeks 1-3 Only)

[*]

[*]

[*]

[*]

[*]

[*]

[*]

757

[*]

[*]

[*]

Day and Weekly Total Weeks 1-4

[*]

[*]

[*]

[*]

[*]

[*]

[*]

[*]

[*]

Week 5

Location

Days operated

Cubic Feet available

TUE

WED

THU

FRI

SAT

SUN

Weekly Total

Aircraft

RATE

Weekly Rate

O/P Rate

EWR

WED THUR, SAT

[*]

[*]

[*]

[*]

[*]

[*]

[*]

MD-10

[*]

[*]

[*]

FLL

WED, SAT

[*]

[*]

[*]

[*]

[*]

[*]

[*]

757

[*]

[*]

[*]

LAX

Thur

[*]

[*]

[*]

[*]

[*]

[*]

[*]

757

[*]

[*]

[*]

LAX

SAT

[*]

[*]

[*]

[*]

[*]

[*]

[*]

MD-10

[*]

[*]

[*]

LAX

SUN

[*]

[*]

[*]

[*]

[*]

[*]

[*]

MD-11

[*]

[*]

[*]

SLC

WED, THUR, SAT

[*]

[*]

[*]

[*]

[*]

[*]

[*]

757

[*]

[*]

[*]

PHL

WED, SAT

[*]

[*]

[*]

[*]

[*]

[*]

[*]

757

[*]

[*]

[*]

TPA

SUN

[*]

[*]

[*]

[*]

[*]

[*]

[*]

757

[*]

[*]

[*]

Day and Weekly Total Week 5

[*]

[*]

[*]

[*]

[*]

[*]

[*]

[*]

[*]

[*]

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

EX-10.3

Exhibit 10.3

AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT   1. CONTRACT ID CODE     PAGE OF   1        3

2. AMENDMENT/MODIFICATION NO. 034	3. EFFECTIVE DATE   03/02/2015	4. REQUISITION/PURCHASE REQ. NO.	5. PROJECT NO. (If applicable)
6. ISSUED BY                         CODE	5ASNET	7. ADMINISTERED BY (IF OTHER THAN ITEM 6)	CODE	5ASNET
ALAINA EARL Air Transportation CMC United States Postal Service 475 L’Enfant Plaza SW Room 1P 650 Washington DC 20260-0650 (202) 268-6580		Air Transportation CMC Air Transportation CMC United States Postal Service 475 L’Enfant Plaza SW, Room 1P650 Washington DC 20260-0650

8. NAME AND ADDRESS OF CONTRACTOR (No., Street, County, State, and Zip Code) FEDERAL EXPRESS CORPORATION 3610 HACKS CROSS ROAD MEMPHIS TN 38125-8800		(x)	9A. AMENDMENT OF SOLICITATION NO.
			9B. DATED (SEE ITEM 11)
		x	10A. MODIFICATION OF CONTRACT/ORDER NO. ACN-13-FX
			10B. DATED (SEE ITEM 13) 04/23/2013
SUPPLIER CODE:        000389122	FACILITY CODE

11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS

¨     ¨  is extended,         ¨  is not extended.

Offers must acknowledge receipt of this amendment prior to the hour and date specified in the solicitation or as amended, by one of the following methods: (a) By completing items 8 and 15, and returning                  copies of the amendment; (b) By acknowledging receipt of this amendment on each copy of the offer submitted; or (c) By separate letter or telegram which includes a reference to the solicitation and amendment number. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this amendment you desire to change an offer already submitted, such change may be made by telegram or letter, provided each telegram or letter makes reference to the solicitation and this amendment, and is received prior to the opening hour and date specified.

12.    ACCOUNTING AND APPROPRIATION DATA      (If Required)          See Schedule Net Increase:    [*]             

13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS. IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.

(x)	A.	THIS CHANGE BY CLAUSE IS ISSUED PURSUANT TO: (Specify Clause) THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO. IN ITEM 10A.
¨
¨	B.	THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE ADMINISTRATIVE CHANGES (such as changes in paying office, appropriation date, etc.) SET FORTH IN ITEM 14.
¨	C.	THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF: THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO. IN ITEM 10A.
x	D.	OTHER (such as no cost change/cancellation, termination, etc.) (Specify type of modification and authority): THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO. IN ITEM 10A. By Mutual Agreement of the Contracting Parties

E. IMPORTANT:     Contractor ¨ is not, x is required to sign this document and return          1           copies to the issuing office.

14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section headings, including solicitation/contract subject matter where feasible.)

In accordance with contract ACN-13-FX and the “Fuel Adjustment” section, the following Line Haul Rate (fuel) for the Day Network as set out in Attachment 10 is modified for performance during the period of March 2, 2015 to March 29, 2015 (Operating Period 18) as follows:

From:

[*] per cubic foot

To:

[*] per cubic foot

Continued...

Except as provided herein, all terms and conditions of the document referenced in Item 9A or 10A, as heretofore changed, remains unchanged and in full force and effect.

15A. NAME AND TITLE OF SIGNER (Type or print)   Paul J. Herron, Vice President 16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)       Brian Mckain

15B. CONTRACTOR/OFFEROR   /s/ PAUL J. HERRON (Signature of person authorized to sign) 15C. DATE SIGNED   06/22/15 16B. CONTRACT AUTHORITY       /s/ BRIAN MCKAIN (Signature of Contracting Officer) 16C. DATE SIGNED   06/23/15

*Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

CONTINUATION SHEET REQUISITION NO.                      Page Of 2         3

CONTRACT/ORDER NO. ACN-13-FX/034 AWARD/ EFFECTIVE DATE   03/02/2015 MASTER/AGENCY CONTRACT NO SOLICITATION NO. SOLICITATION ISSUE DATE

ITEM NO.	SCHEDULE OF SUPPLIES/SERVICES	QUANTITY	UNIT	UNIT PRICE	AMOUNT
1	This is a decrease of [*]. [*] This modification also incorporates Operating Period 21 (June) Scheduled Charters into the ACN-13-FX contract, with the following conditions: A) Once the Charters are scheduled they cannot be canceled. B) All Service and Scan penalties (reductions in payment) will be eliminated for Operating Period 21 in which these “Scheduled Charters” will operate. C) Volume will be inducted into the network at the Memphis Hub and will incur appropriate tier pricing and will be processed normally. FedEx will notify the Postal Service if the Tender requirement is different than what is currently in the contract. Delivery does not change. Payments for said charters will be paid as part of the Operating Period reconciliation. Sub Rept Req’d: Y Carrier Code: FX Route Termini S: Various Route Termini End: Various Payment Terms: SEE CONTRACT Discount Terms: See Schedule Accounting Info: BFN: 670167 FOB: Destination Period of Performance: 12/01/2014 to 09/30/2020 Change Item 1 to read as follows: Day Network Continued...
					[*]

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

CONTINUATION SHEET REQUISITION NO.                      PAGE OF 3         3

CONTRACT/ORDER NO. ACN-13-FX/034 AWARD/ EFFECTIVE DATE   03/02/2015 MASTER/AGENCY CONTRACT NO. SOLICITATION NO. SOLICITATION ISSUE DATE

ITEM NO.	SCHEDULE OF SUPPLIES/SERVICES	QUANTITY	UNIT	UNIT PRICE	AMOUNT
7	Account Number: 53503 Delivery: 12/01/2014 Delivery Location Code: 18310M WASHINGTON D DC NOM WASHINGTON DC NOM USPS 475 LENFANT PLZ SW RM 6631 WASHINGTON DC 202606631 Amount: [*] Change Item 7 to read as follows: Scheduled Charter Option Account Number: 53703 Delivery: 03/30/2015 Delivery Location Code: 18310M USPS SHARED NETWORKS 475 LENFANT PLZ SW RM 7900 WASHINGTON DC 20260-6631 Amount: [*]				[*]

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

FedEx Scheduled Charters-USPS June Operating Period

TUE

WED

THU

FRI

SAT

SUN

Weekly Total

A/C Type

Rate

Weekly Rate

O/P Rate

Location

Days operated

Cubic Feet available

EWR

TUES, THURS, SAT

[*]

[*]

[*]

[*]

[*]

[*]

[*]

[*]

MD-10

[*]

[*]

[*]

FLL

TUES

[*]

[*]

[*]

[*]

[*]

[*]

[*]

[*]

757

[*]

[*]

[*]

LAX

TUES, SAT, SUN

[*]

[*]

[*]

[*]

[*]

[*]

[*]

[*]

757

[*]

[*]

[*]

LAX

THUR

[*]

[*]

[*]

[*]

[*]

[*]

[*]

[*]

A310

[*]

[*]

[*]

PHX

TUES (June 16 and 23 only)

[*]

[*]

[*]

[*]

[*]

[*]

[*]

[*]

A310

[*]

[*]

[*]

SLC

TUES, THURS, SAT

[*]

[*]

[*]

[*]

[*]

[*]

[*]

[*]

757

[*]

[*]

[*]

TPA

SUN

[*]

[*]

[*]

[*]

[*]

[*]

[*]

[*]

757

[*]

[*]

[*]

OAK

SUN (June 21, 28 only)

[*]

[*]

[*]

[*]

[*]

[*]

[*]

[*]

A-300

[*]

[*]

[*]

PHL

TUES, THURS, SAT

[*]

[*]

[*]

[*]

[*]

[*]

[*]

[*]

757

[*]

[*]

[*]

Day and Weekly Total Week

[*]

[*]

[*]

[*]

[*]

[*]

[*]

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

EX-10.4

Exhibit 10.4

AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT   1. CONTRACT ID CODE     PAGE OF   1        6

2. AMENDMENT/MODIFICATION NO. 036	3. EFFECTIVE DATE   01/04/2016	4. REQUISITION/PURCHASE REQ. NO.	5. PROJECT NO. (If applicable)
6. ISSUED BY                         CODE	5ASNET	7. ADMINISTERED BY (IF OTHER THAN ITEM 6)	CODE	5ASNET
ALAINA EARL Air Transportation CMC United States Postal Service 475 L’Enfant Plaza SW Room 1P 650 Washington DC 20260-0650 (202) 268-6580		Air Transportation CMC Air Transportation CMC United States Postal Service 475 L’Enfant Plaza SW, Room 1P650 Washington DC 20260-0650

8. NAME AND ADDRESS OF CONTRACTOR (No., Street, County, State, and Zip Code) FEDERAL EXPRESS CORPORATION 3610 HACKS CROSS ROAD MEMPHIS TN 38125-8800		(x)	9A. AMENDMENT OF SOLICITATION NO.
			9B. DATED (SEE ITEM 11)
		x	10A. MODIFICATION OF CONTRACT/ORDER NO. ACN-13-FX
			10B. DATED (SEE ITEM 13) 04/23/2013
SUPPLIER CODE:      000389122	FACILITY CODE

11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS

¨     ¨  is extended,         ¨  is not extended.

Offers must acknowledge receipt of this amendment prior to the hour and date specified in the solicitation or as amended, by one of the following methods: (a) By completing items 8 and 15, and returning                  copies of the amendment; (b) By acknowledging receipt of this amendment on each copy of the offer submitted; or (c) By separate letter or telegram which includes a reference to the solicitation and amendment number. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this amendment you desire to change an offer already submitted, such change may be made by telegram or letter, provided each telegram or letter makes reference to the solicitation and this amendment, and is received prior to the opening hour and date specified.

12.    ACCOUNTING AND APPROPRIATION DATA      (If Required)          See Schedule Net Increase: [*]            

13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS. IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.

(x)	A.	THIS CHANGE BY CLAUSE IS ISSUED PURSUANT TO: (Specify Clause) THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO. IN ITEM 10A.
¨
¨	B.	THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE ADMINISTRATIVE CHANGES (such as changes in paying office, appropriation date, etc.) SET FORTH IN ITEM 14.
¨	C.	THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF: THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO. IN ITEM 10A.
x	D.	OTHER (such as no cost change/cancellation, termination, etc.) (Specify type of modification and authority): THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO. IN ITEM 10A. By Mutual Agreement of the Contracting Parties

E. IMPORTANT:     Contractor ¨ is not, x is required to sign this document and return          1           copies to the issuing office.

14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section headings, including solicitation/contract subject matter where feasible.)

The purpose of this modification is to incorporate the following into the ACN-13-FX contract:

A) Effective with the January 2016 Operating Period (OP 28), the aviation supplier will accept [*] cubic feet per week at distribution by day of week, origin and destination as set out in Attachment 18, Volume Acceptance Worksheet.

B) The Required Delivery Times (RDT) for First Class Mail to markets identified in Attachment 19, First Class Mail Required Delivery Times will be adjusted for up to 20% of the market volumes by operating day and will be mutually agreed upon as part of the planning process.

Continued...

Except as provided herein, all terms and conditions of the document referenced in Item 9A or 10A, as heretofore changed, remains unchanged and in full force and effect.

15A. NAME AND TITLE OF SIGNER (Type or print)   Paul J. Herron, Vice President 16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)       Brian Mckain

15B. CONTRACTOR/OFFEROR   /s/ PAUL J. HERRON (Signature of person authorized to sign) 15C. DATE SIGNED   08/28/15 16B. CONTRACT AUTHORITY       /s/ BRIAN MCKAIN (Signature of Contracting Officer) 16C. DATE SIGNED   08/31/15

*Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

CONTINUATION SHEET REQUISITION NO.                      Page Of 2         6

CONTRACT/ORDER NO. ACN-13-FX/036 AWARD/ EFFECTIVE DATE   01/04/2016 MASTER/AGENCY CONTRACT NO SOLICITATION NO. SOLICITATION ISSUE DATE

ITEM NO.	SCHEDULE OF SUPPLIES / SERVICES	QUANTITY	UNIT	UNIT PRICE	AMOUNT
	C) Lines 573 – 575 of the Ordering Process – Non-Peak – Day Network section will be changed as follows: FROM: [*] TO: [*] D) The aviation supplier will make an additional [*] cubic feet per day available to the Postal Service during Peak beginning with Peak 2016. Peak Tier Five pricing will apply to Peak Season 2015 and 2016. The contracting parties will discuss possible adjustments to the pricing and distribution of the additional volume beginning with Peak Season 2017. Therefore, lines 624 – 625 of the Ordering Process – Peak – Day Network section will change as follows:
	FROM:
	The aviation supplier will make available at least [*] cubic feet of capacity per week for the Peak Operating Period for the Day Network. TO: Continued…

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

CONTINUATION SHEET REQUISITION NO.                      Page Of 3         6

CONTRACT/ORDER NO. ACN-13-FX/036 AWARD/ EFFECTIVE DATE   01/04/2016 MASTER/AGENCY CONTRACT NO SOLICITATION NO. SOLICITATION ISSUE DATE

ITEM NO.	SCHEDULE OF SUPPLIES / SERVICES	QUANTITY	UNIT	UNIT PRICE	AMOUNT
	The aviation supplier will make available at least [*] cubic feet of capacity per week for the Peak Operating Period for the Day Network. E) The following is inserted at Line 640, Section: Ordering Process – Peak – Day Network: If either party is more than 10 days late in providing the requests and responses set forth in this paragraph, the other party may elect to use the preceding year’s Peak Planned Capacity for the Peak period in question. F) Lines 831 – 835, Reduction of Payment Section shall be changed FROM: a. All Handling Units delivered up to thirty (30) minutes late will be subject to a [*]% reduction of the Transportation Payment.
	b. All Handling Units delivered from thirty-one (31) minutes up to one (1) hour to late will be subject to a [*]% reduction of the Transportation Payment.
	TO: a. All Handling Units delivered up to thirty (30) minutes late will not be considered for purposes of calculating reduction of the Transportation Payment, but will be considered in the overall service calculation. b. All Handing Units delivered from thirty-one (31) minutes up to one (1) hour to late will be subject to a [*]% reduction of the Transportation Payment. G) The table listed on line 2552, under Clause 4-1: General Terms and Conditions (July 2007) (Tailored), Section d. Termination on Notice will be change to reflect [*] as updated in the attached updated contract language. Continued…

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

CONTINUATION SHEET REQUISITION NO.                      Page Of 4         6

CONTRACT/ORDER NO. ACN-13-FX/036 AWARD/ EFFECTIVE DATE   01/04/2016 MASTER/AGENCY CONTRACT NO SOLICITATION NO. SOLICITATION ISSUE DATE

ITEM NO.	SCHEDULE OF SUPPLIES / SERVICES	QUANTITY	UNIT	UNIT PRICE	AMOUNT
	H) The following has been added at Line 2572: If the Postal Service terminates the contract under this provision, the Postal Service guarantees to provide the aviation supplier a volume commitment through the effective date of the termination of not less than the daily average volume offered in the two most recently completed Operating Periods prior to the date of the receipt of the notice of termination, or, it two Operating Periods have not been completed when the notice of termination is received, the daily average volume offered shall at least equal to the average daily volume prior to the receipt of the written notice of termination. I) Attachment 3, Operating Plan, Day Network is update to include adjustments to the following Destinating Operation RDTs: [*] have been [*] at ICT and the Required Delivery Time has changed from [*] [*] minutes have been [*] at SHV and the Required Delivery Time has changed from [*] [*] minutes have been [*] at BTS/CRW and the Required Delivery Time has changed from [*] [*] minutes have been [*] at ORF and the Required Delivery Time has changed from [*]
	J) The Required Delivery Times for 25% of the destination volume for the following locations will be adjusted when served as point-to-point flights as follows: [*] have been [*] at OAK – ORD and the Required Delivery Time has changed from [*]
	[*] have been [*] at EWR – DFW and the Required Delivery Time has changed from [*] [*] have been [*] at OAK – DFW and the Required Delivery Time has changed from [*] Continued…

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

CONTINUATION SHEET REQUISITION NO.                      Page Of 5         6

CONTRACT/ORDER NO. ACN-13-FX/036 AWARD/ EFFECTIVE DATE   01/04/2016 MASTER/AGENCY CONTRACT NO SOLICITATION NO. SOLICITATION ISSUE DATE

ITEM NO.	SCHEDULE OF SUPPLIES / SERVICES	QUANTITY	UNIT	UNIT PRICE	AMOUNT
	[*] [*] have been [*] at OAK – ATL and the Required Delivery Time has changed from [*] K) The RDTs for the last 25% of the destination volume for the following fly-truck combinations will be [*] as follows: Truck to or from OAK to or from SFO [*] Truck to or from OAK to or from SMF [*] Truck to or from LAX to or from ONT [*] L) Attachment 3, Operating Plan, Day Network is update to include adjustments to the following Origin Tender Times: BOI [*] from [*] (Sunday Only) GEG [*] from [*] (Sunday Only) OMA [*] from [*] (Sunday Only) SDF [*] from [*] (Daily)
	M) The RDTs for the following locations will be adjusted when served as the second stop on multi-stop flights: BIL [*] from [*] MIA [*] from [*] (except PBI) MSP [*] from [*] PHL [*] from [*] (except MDT) N) An updated Attachment 10 has been included. O) The Postal Service will establish goals and develop action plans to increase the bypass rate to 25% on Tuesday – Saturday and 15% on Sunday. The Postal Service will communicate these plans with their field operations and the Terminal Continued…

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

CONTINUATION SHEET REQUISITION NO.                      Page Of 6         6

CONTRACT/ORDER NO. ACN-13-FX/036 AWARD/ EFFECTIVE DATE   01/04/2016 MASTER/AGENCY CONTRACT NO SOLICITATION NO. SOLICITATION ISSUE DATE

ITEM NO.	SCHEDULE OF SUPPLIES / SERVICES	QUANTITY	UNIT	UNIT PRICE	AMOUNT
	Handling Supplier (THS) stressing the importance of increasing bypass rates. P) The Postal Service agrees to include the aviation supplier in the early stages of all performance measurement and billing system modifications to allow joint programming changes. The Postal Service will allow the aviation supplier a commercially reasonable amount of time to make all required changes to the aviation supplier’s systems prior to implementation. All other terms and conditions remain the same. Sub Rept Req’d: Y Carrier Code: FX Route Termini S: Various Route Termini End: Various Payment Terms: SEE CONTRACT Delivery: 12/01/2014 Discount Terms: See Schedule Accounting Info: BFN: 670167 FOB: Destination Period of Performance: 12/01/2014 to 09/30/2020 Change Item 1 to read as follows:
1	Day Network				[*]
	Account Number: 53503 This is for estimation purposes only and is not a guarantee of contract value.

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Attachment 10 1-Jun-15

[*]

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

TW ORIGIN FORECAST COMPARISON				RF		Sat		Sun
Location Type	Market	DJan15Orig Sub.xls Forecast CU FT	Percent of Total Volume	DJan15Ori gSub.xls Forecast CU FT	Percent of Total Volume	DJan15Ori gSub.xls Forecast CU FT	Percent of Total Volume	DJan15Ori gSub.xls Forecast CU FT	Percent of Total Volume
Orig	ABQ	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	ANC	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	ATL	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	AUS	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	BDL	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	BFM	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	BHM	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	BIL	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	BNA	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	BOI	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	BOS	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	BWI	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	CLE	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	CLT	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	CVG	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	DEN	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	DFW	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	DSM	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	DTW	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	ELP	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	EWR	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	FSD	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	GEG	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	GFK	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	GRR	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	GSO	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	GTF	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	HNL	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	HTS	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	IAD	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	IAH	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Orig	ICT	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	IND	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	JAN	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	JAX	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	JFK	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	LAS	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	LAX	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	LBB	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	LCK	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	LIT	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	MCI	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	MCO	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	MEM	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	MHT	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	MIA	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	MKE	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	MSP	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	MSY	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	OAK	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	OKC	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	OMA	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	ONT	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	ORD	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	ORF	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	PDX	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	PHL	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	PHX	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	PIT	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	RDU	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	RIC	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	RNO	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	ROC	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	SAN	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	SAT	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	SDF	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	SEA	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Orig	SFO	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	SGF	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	SHV	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	SJU	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	SLC	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	SMF	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	STL	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	TPA	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	TUL	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	TUS	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	TYS	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Orig	TOTAL	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]

Note - TUS volume is included in PHX, TUL volume is included in OKC, SGF volume is included in MCI, MLI volume is included in STL based on proje

Additional ONT capacity may be provided out of LAX rather than ONT

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

TW DEST FORECAST COMPARISON				RF		Sat		Sun
Location Type	Market	DJan15Ori gSub.xls Forecast CU FT	Percent of Total Volume	DJan15OrigS ub.xls Forecast CU FT	Percent of Total Volume	DJan15OrigS ub.xls Forecast CU FT	% DIFF	DJan15OrigS ub.xls Forecast  CU FT	% DIFF
Dest	ABQ	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	ANC	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	ATL	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	AUS	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	BDL	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	BFM	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	BHM	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	BIL	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	BNA	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	BOI	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	BOS	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	BWI	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	CLE	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	CLT	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	CVG	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	DEN	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	DFW	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	DSM	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	DTW	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	ELP	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	EWR	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	FSD	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	GEG	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	GFK	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	GRR	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	GSO	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	GTF	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	HNL	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	HTS	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	IAD	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	IAH	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Dest	ICT	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	IND	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	JAN	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	JAX	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	JFK	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	LAS	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	LAX	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	LBB	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	LCK	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	LIT	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	MCI	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	MCO	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	MEM	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	MHT	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	MIA	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	MKE	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	MSP	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	MSY	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	OAK	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	OKC	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	OMA	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	ONT	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	ORD	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	ORF	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	PDX	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	PHL	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	PHX	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	PIT	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	RDU	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	RIC	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	RNO	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	ROC	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	SAN	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	SAT	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	SDF	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	SEA	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Dest	SFO	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	SGF	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	SHV	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	SJU	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	SLC	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	SMF	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	STL	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	TPA	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	TUL	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	TUS	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	TYS	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Dest	TOTAL	[*]	[*]	[*]	[*]	[*]	[*]	[*]	[*]

cted Postal closures

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

AMC	RDT Needed for 0800 at all plants
ABQ	[*]
ANC	[*]
ATL	[*]
AUS	[*]
BDL	[*]
BHM	[*]
BIL	[*]
BNA	[*]
BOI	[*]
BOS	[*]
BWI	[*]
CLE	[*]
CLT	[*]
CMH	[*]
CRW	[*]
CVG	[*]
DEN	[*]
DFW	[*]
DSM	[*]
DTW	[*]
ELP	[*]
EWR	[*]
FSD	[*]
GEG	[*]
GFK	[*]
GRR	[*]
GSO	[*]
GTF	[*]
HNL	[*]
IAD	[*]
IAH	[*]
ICT	[*]
IND	[*]
JAN	[*]
JAX	[*]
JFK	[*]
LAS	[*]
LAX	[*]
LBB	[*]
LIT	[*]
MCI	[*]
MCO	[*]
MEM	[*]
MHT	[*]
MIA	[*]
MKE	[*]
MLI	[*]
MOB	[*]
MSP	[*]
MSY	[*]
OAK	[*]

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

OKC	[*]
OMA	[*]
ONT	[*]
ORD	[*]
PDX	[*]
PHL	[*]
PHX	[*]
PIT	[*]
RDU	[*]
RIC	[*]
RNO	[*]
ROC	[*]
SAN	[*]
SAT	[*]
SDF	[*]
SEA	[*]
SFO	[*]
SGF	[*]
SHV	[*]
SJU	[*]
SLC	[*]
SMF	[*]
SPI	[*]
STL	[*]
TPA	[*]
TUL	[*]
TYS	[*]

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

EX-10.5

Exhibit 10.5

Supplemental Agreement No. 6

to

Purchase Agreement No. 3712

between

The Boeing Company

And

Federal Express Corporation

Relating to Boeing Model 767-3S2F Aircraft

THIS SUPPLEMENTAL AGREEMENT, entered into as of July 21, 2015 by and between THE BOEING COMPANY (Boeing) and FEDERAL EXPRESS CORPORATION (Customer);

W I T N E S S E T H:

A. WHEREAS, the parties entered into Purchase Agreement No. 3712, dated December 14, 2011 (Purchase Agreement), relating to the purchase and sale of certain Boeing Model 767-3S2F Aircraft (the Aircraft); and

B. WHEREAS, Customer desires to add fifty (50) Aircraft to the Purchase Agreement, which shall be designated as either Block E, Block F or Block G Aircraft, with delivery dates as follows:

Delivery Month & Year of new Aircraft	Block
[*]	Block E
[*]	Block E
[*]	Block E
[*]	Block E
[*]	Block E
[*]	Block E
[*]	Block E
[*]	Block E

BOEING PROPRIETARY

S6-1

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Supplemental Agreement No. 6 to

Purchase Agreement No. 3712

[*]	Block E
[*]	Block E
[*]	Block E
[*]	Block E
[*]	Block E
[*]	Block E
[*]	Block E
[*]	Block E
[*]	Block E
[*]	Block E
[*]	Block E
[*]	Block E
[*]	Block E
[*]	Block E
[*]	Block E
[*]	Block E
[*]	Block E
[*]	Block E
[*]	Block E
[*]	Block E
[*]	Block E
[*]	Block E
[*]	Block E
[*]	Block E
[*]	Block E
[*]	Block E
[*]	Block F
[*]	Block F
[*]	Block F

BOEING PROPRIETARY

S6-2

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Supplemental Agreement No. 6 to

Purchase Agreement No. 3712

[*]	Block F
[*]	Block F
[*]	Block F
[*]	Block F
[*]	Block F
[*]	Block F
[*]	Block F
[*]	Block F
[*]	Block G
[*]	Block G
[*]	Block G
[*]	Block G

C. WHEREAS, Customer desires to reschedule twenty (20) Option Aircraft with delivery dates as follows:

Prior Delivery Month & Year for Option Aircraft	Revised Delivery Month & Year for Option Aircraft
[*]	[*]
[*]	[*]
[*]	[*]
[*]	[*]
[*]	[*]
[*]	[*]
[*]	[*]
[*]	[*]
[*]	[*]
[*]	[*]
[*]	[*]
[*]	[*]
[*]	[*]
[*]	[*]

BOEING PROPRIETARY

S6-3

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Supplemental Agreement No. 6 to

Purchase Agreement No. 3712

[*]	[*]
[*]	[*]
[*]	[*]
[*]	[*]
[*]	[*]
[*]	[*]

D. WHEREAS, Customer desires to reschedule fifteen (15) Block D Option Aircraft with delivery dates as follows:

Prior Delivery Month & Year for Block D Option Aircraft	Revised Delivery Month & Year for Block D Option Aircraft
[*]	[*]
[*]	[*]
[*]	[*]
[*]	[*]
[*]	[*]
[*]	[*]
[*]	[*]
[*]	[*]
[*]	[*]
[*]	[*]
[*]	[*]
[*]	[*]
[*]	[*]
[*]	[*]
[*]	[*]

BOEING PROPRIETARY

S6-4

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Supplemental Agreement No. 6 to

Purchase Agreement No. 3712

E. WHEREAS, Customer desires to add fifteen (15) Option Aircraft to the Purchase Agreement, hereinafter referred to as Option Aircraft, with delivery dates as follows:

Delivery Month & Year for Option Aircraft	Block
[*]	Option Aircraft
[*]	Option Aircraft
[*]	Option Aircraft
[*]	Option Aircraft
[*]	Option Aircraft
[*]	Option Aircraft
[*]	Option Aircraft
[*]	Option Aircraft
[*]	Option Aircraft
[*]	Option Aircraft
[*]	Option Aircraft
[*]	Option Aircraft
[*]	Option Aircraft
[*]	Option Aircraft
[*]	Option Aircraft

F. WHEREAS, Customer desires to add thirty-seven (37) Purchase Rights to the Purchase Agreement.

G. WHEREAS, Customer desires that [*] except as specifically provided for in this Supplemental Agreement.

H. WHEREAS, Customer, Boeing and General Electric Company have executed a separate Tri-party Agreement Regarding [*] dated July 21, 2015_to address certain [*].

I. WHEREAS, Boeing has provided Customer a Letter regarding [*].

NOW THEREFORE, in consideration of the mutual covenants herein contained, the parties hereto agree to supplement the Purchase Agreement as follows:

All terms used herein and in the Purchase Agreement, and not defined herein, shall have the same meaning as in the Purchase Agreement.

BOEING PROPRIETARY

S6-5

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Supplemental Agreement No. 6 to

Purchase Agreement No. 3712

1. Remove and replace, in its entirety, the Table of Contents with the revised Table of Contents attached hereto to reflect certain corrections to Letter Agreement titles and the changes made by this Supplemental Agreement No. 6.

2. Boeing and Customer acknowledge and agree that execution of this Supplemental Agreement No. 6 and upon fulfillment of the condition described in Article 25 below, (i) thirty-five (35) of the fifty (50) Aircraft described in Recital Paragraph B are hereby added to the Purchase Agreement and are considered by the parties as “Block E Aircraft”, (ii) eleven (11) of the fifty (50) Aircraft described in Recital Paragraph B are hereby added to the Purchase Agreement and are considered by the parties as “Block F Aircraft”, (iii) four (4) of the fifty (50) Aircraft described in Recital paragraph B above are hereby added to the Purchase Agreement as conditional firm aircraft and will be considered by the parties as “Block G Aircraft”, (iv) the twenty (20) Option Aircraft described in Recital Paragraph C above and the fifteen (15) Block D Option Aircraft described in Recital Paragraph D above are rescheduled as described herein, (v) the fifteen (15) Option Aircraft described in Recital Paragraph E are hereby added to the Purchase Agreement as “Option Aircraft” and shall be deemed such for all purposes under the Purchase Agreement except as otherwise set forth herein and (vi) thirty-seven (37) Purchase Rights are hereby added to the Purchase Agreement increasing the total quantity of Purchase Rights to fifty (50). The Block E, F and G Aircraft will be deemed “Aircraft” for all purposes under the Purchase Agreement.

3. Insert a new Table 1-A2, attached hereto, to add to the Purchase Agreement the thirty-five (35) Block E Aircraft, the eleven (11) Block F Aircraft and the four (4) Block G Aircraft described in Recital Paragraph B above.

4. Revise and replace in its entirety, Table 1-B with a revised Table 1-B, attached hereto, to update the specification reference and to add a note pertaining to one Block B Aircraft.

5. Revise and replace in its entirety Letter Agreement FED-PA-03712-LA-1106151R1, Special Matters Concerning [*] – Option Aircraft and Certain Purchase Right Aircraft, with Letter Agreement FED-PA-03712-LA-1106151R2, Special Matters Concerning [*] – Option Aircraft and Certain Purchase Right Aircraft, attached hereto, to extend the [*] for Option Aircraft and apply the [*] of such revised Letter Agreement to the fifteen (15) Option Aircraft described in Recital Paragraph E above.

BOEING PROPRIETARY

S6-6

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Supplemental Agreement No. 6 to

Purchase Agreement No. 3712

6. Revise and replace in its entirety Letter Agreement FED-PA-03712-LA-1106154R1, Firm Aircraft Delivery Matters, with Letter Agreement FED-PA-03712-LA-1106154R2, Firm Aircraft and Option Aircraft Delivery Matters, attached hereto, to revise the [*] applicable to firm Aircraft and Option Aircraft pursuant to the Purchase Agreement.

7. Revise and replace in its entirety Letter Agreement FED-PA-03712-LA-1106156R1, Option Aircraft, with Letter Agreement FED-PA-03712-LA-1106156R2, Option Aircraft, and attachments 1 and 2 and new attachments 3 and 4 to such Letter Agreement, each attached hereto, to reflect: (i) revised terms relating to Option Aircraft, (ii) the rescheduling of the Option Aircraft described in Recital Paragraph C above, (iii) the rescheduling of the Block D Option Aircraft described in Recital Paragraph D above and (iv) the addition of the Option Aircraft described in Recital Paragraph E above.

8. Revise and replace in its entirety Letter Agreement FED-PA-03712-LA-1106158R1, Right to Purchase Additional Aircraft, with Letter Agreement FED-PA-03712-LA-1106158R2, Right to Purchase Additional Aircraft, attached hereto, to add the Purchase Rights described in Recital Paragraph F above and to revise the delivery window and expiration date of the Purchase Rights.

9. Revise and replace in its entirety Letter Agreement FED-PA-03712-LA-1106177, [*], with Letter Agreement FED-PA-03712-LA-1106177R1, [*], attached hereto, to revise certain business terms.

10. Revise and replace in its entirety Letter Agreement FED-PA-03712-LA-1106574, Agreement for Deviation from the [*], with Letter Agreement FED-PA-03712-LA-1106574R1, Agreement for Deviation from the [*], attached hereto, to reflect the performance guarantee Letter Agreement revision described in Paragraph 11 below.

11. Revise and replace in its entirety Letter Agreement FED-PA-03712-LA-1106584R3, Aircraft Performance Guarantees, with Letter Agreement FED-PA-03712-LA-1106584R4, Aircraft Performance Guarantees, attached hereto, to reflect the addition of the Block E, Block F and Block G Aircraft described in Recital Paragraph B above.

12. Revise and replace in its entirety Letter Agreement FED-PA-03712-LA-1106614R1, Special Matters for Purchase Right Aircraft, with Letter Agreement FED-PA-03712-LA-1106614R2, Special Matters for Purchase Right Aircraft, attached hereto, to reflect a revision to the business terms applicable to Purchase Rights Aircraft, if exercised.

BOEING PROPRIETARY

S6-7

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Supplemental Agreement No. 6 to

Purchase Agreement No. 3712

13. Revise and replace in its entirety Letter Agreement FED-PA-03712-LA-1208292R1, Special Matters Concerning Escalation – Block B and Block C Aircraft with Letter Agreement FED-PA-03712-LA-1208292R2, Special Matters Concerning Escalation – Block B, Block C, Block E, Block F and Block G Aircraft, attached hereto, to extend the [*] and apply the [*] of such revised Letter Agreement to the thirty-five (35) Block E Aircraft, the eleven (11) Block F Aircraft and the four (4) Block G Aircraft described in Recital Paragraph B.

14. Revise and replace in its entirety Letter Agreement FED-PA-03712-LA-1208296, Special Matters for Block D Option Aircraft, with Letter Agreement FED-PA-03712-LA-1208296R1, Special Matters for Block D Option Aircraft, attached hereto, to reflect a revision to the business terms applicable to Block D Option Aircraft, if exercised.

15. Revise and replace in its entirety Letter Agreement 6-1162-SCR-146, Special Provision - Block B Aircraft, with Letter Agreement 6-1162-SCR-146R1, Special Provision - Block B and Block G Aircraft, attached hereto, to reflect the addition of the four (4) Block G Aircraft and the application of the terms of the revised Letter Agreement to such Block G Aircraft.

16. Revise and replace in its entirety Letter Agreement FED-PA-03712-LA-1306854, Performance Guarantees, Demonstrated Compliance, with Letter Agreement FED-PA-03712-LA-1306854R1, Performance Guarantees, Demonstrated Compliance, attached hereto, to reflect the performance guarantee Letter Agreement revision described in Paragraph 11 above.

17. Add a new Letter Agreement 6-1162-LKJ-0705, Special Matters for Block E, Block F and Block G Aircraft in Table 1-A2, attached hereto, to describe the business terms applicable to the Block E, Block F and Block G Aircraft described in Recital Paragraph B above.

18. Add a new Letter Agreement 6-1162-LKJ-0707, Agreement Regarding [*], attached hereto, to describe the terms applicable to [*].

19. Add a new Letter Agreement 6-1162-LKJ-0709, [*] Special Matters, attached hereto, to describe [*].

20. For the sake of clarity, the parties agree that the thirty-five (35) Block E Aircraft, eleven (11) Block F Aircraft and four (4) Block G Aircraft added herein shall be subject to Letter Agreement FED-PA-03712-LA-1106159R1, Special Matters Concerning [*] and Letter Agreement FED-PA-03712-LA-1106584R4, Aircraft Performance Guarantees.

BOEING PROPRIETARY

S6-8

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Supplemental Agreement No. 6 to

Purchase Agreement No. 3712

21. Letter Agreement 6-1162-LKJ-0696R6, [*], executed by the parties on January 22, 2015, is hereby added to the Table of Contents of the Purchase Agreement. Additionally, for the avoidance of doubt, the thirty-five (35) Block E Aircraft and the eleven (11) Block F Aircraft (both of which are described in Recital Paragraph B above) are [*] pursuant to Letter Agreement 6-1162-LKJ-0696R6, and, together with the four (4) Aircraft added to the Purchase Agreement pursuant to Supplemental Agreement No. 5, raise the total number of [*] purchased as of the date of execution of this Supplemental Agreement No. 6 to fifty (50).

22. The parties agree that the revisions in this SA-6 are intended to result in [*] except as specifically provided for in this Supplemental Agreement. Notwithstanding the above, [*] to Customer consisting of: (i) an additional [*] for the Block E, Block F and Block G Aircraft as described in paragraph 1.6 of Letter Agreement 6-1162-LKJ-0705, Special Matters for Block E, Block F and Block G Aircraft in Table 1-A2 in an [*] and subject to [*] in accordance with the Purchase Agreement, (ii) a [*] applicable to [*] as described in Letter Agreement FED-S2-2-LA-1501881, [*] Special Matters – [*][*] as described in Letter Agreement FED-PA-03712-LA-1106177R1, [*], resulting in [*], and (iv) [*] as described in Letter Agreement 6-1162-LKJ-0696R6, [*], which the parties acknowledge for the purposes of this Article 22 is [*].

23. As a result of the changes incorporated in this Supplemental Agreement No. 6, Customer will [*] applicable to each of the thirty-five (35) Block E Aircraft, eleven (11) Block F Aircraft, and four (4) Block G Aircraft described in Recital Paragraph B and added to the Purchase Agreement pursuant to this Supplemental Agreement No. 6 and (ii) an Option Deposit [*] for each of the fifteen (15) Option Aircraft described in Recital Paragraph E and added to the Purchase Agreement pursuant to this Supplemental Agreement No. 6. [*]. For clarity, the terms “pre-delivery payment(s)”, “PDP(s)” and “advance payment(s)” are used on an interchangeable basis. [*] of executing this Supplemental Agreement No. 6.

24. This Supplemental Agreement No. 6 to the Purchase Agreement shall not be effective unless executed and delivered by the parties on or prior to July 31, 2015.

25. Notwithstanding the foregoing Article 24, the effectiveness of this Supplemental Agreement No. 6 is expressly conditioned upon Customer receiving approval from the board of directors of Customer’s parent company, FedEx Corporation. Should such approval not be granted and confirmed in writing by Customer to Boeing on or by July 31, 2015, this Supplemental Agreement No. 6 shall automatically terminate and be null and void in all respects, and neither party shall owe

BOEING PROPRIETARY

S6-9

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Supplemental Agreement No. 6 to

Purchase Agreement No. 3712

any obligation to the other party with respect to the matters expressed herein; provided, however, no such termination shall otherwise impact the parties’ rights and obligations existing under the Purchase Agreement, as amended or otherwise modified, prior to this Supplemental Agreement No. 6. For the sake of clarity, neither party shall be deemed to be in default hereunder for failing to have performed any obligation created under this Supplement Agreement No. 6, including, without limitation, any payment obligation, prior to the receipt by Boeing of the aforementioned written confirmation.

BOEING PROPRIETARY

S6-10

Supplemental Agreement No. 6 to

Purchase Agreement No. 3712

EXECUTED as of the day and year first above written.

THE BOEING COMPANY
By:	/s/ Kirsten Jensen
Its:	Attorney-In-Fact
FEDERAL EXPRESS CORPORATION
By:	/s/ Phillip C. Blum
Its:	Vice President Aircraft Acquisition

BOEING PROPRIETARY

S6-11

TABLE OF CONTENTS

ARTICLES		SA Number
1	Quantity, Model and Description
2	Delivery Schedule
3	Price
4	Payment
5	Additional Terms
TABLES
1-A	Firm Aircraft Information Table		1
1-A1	Block C Aircraft Information Table
1-A2	Block E, Block F and Block G Aircraft Information Table		6
1-B	Exercised Option Aircraft Information Table		6
1-B1	Exercised Block D Option Aircraft Information Table		2
1-C	Exercised Purchase Right Aircraft Information Table		2
EXHIBIT
A	Aircraft Configuration		4
B	Aircraft Delivery Requirements and Responsibilities
SUPPLEMENTAL EXHIBITS
AE1	Escalation Adjustment/Airframe and Optional Features
BFE1	BFE Variables		2
CS1	Customer Support Variables
EE1	Engine Escalation, Engine Warranty and Patent Indemnity
SLP1	Service Life Policy Components

FED-PA-03712 SA-6

BOEING PROPRIETARY

LETTER AGREEMENTS		SA Number
LA-1106151R2	LA-Special Matters Concerning [*] – Option Aircraft and Certain Purchase Right Aircraft		6
LA-1106152	LA-Special Matters Concerning [*] – Firm Aircraft
LA-1106153	LA-Liquidated Damages Non-Excusable Delay
LA-1106154R2	LA-Firm Aircraft and Option Aircraft Delivery Matters		6
LA-1106155	LA-Open Configuration Matters
LA-1106156R2	LA-Option Aircraft		6
LA-1106157	AGTA Amended Articles
LA-1106158R2	LA-Right to Purchase Additional Aircraft		6
LA-1106159R1	LA-Special Matters Concerning [*]		1
LA-1106160	LA-Spare Parts Initial Provisioning
LA-1106163	LA-Demonstration Flight Waiver
LA-1106177R1	LA- [*]		6
LA-1106207R1	LA-Special Matters Firm Aircraft		1
LA-1106208R1	LA-Special Matters Option Aircraft		1
LA-1106574R1	LA-Agreement for Deviation from the [*]		6
LA-1106584R4	LA-Aircraft Performance Guarantees		6
LA-1106586	LA-Miscellaneous Matters
LA-1106614R1	LA-Special Matters for Purchase Right Aircraft		6
LA-1106824	LA-Customer Support Matters
LA-1208292R2	LA-Special Matters Concerning Escalation – Block B, Block C, Block E, Block F and Block G Aircraft		6
LA-1208296R1	LA-Special Matters for Block D Option Aircraft		6
LA-1208949	LA-Special Matters Block C Aircraft in Table 1-A1		1
6-1162-SCR-146R1	LA Special Provision - Block B and Block G Aircraft		6
LA-1306854R1	Performance Guarantees, Demonstrated Compliance		6
6-1162-LKJ-0696R6	LA-[*]		6
6-1162-LKJ-0705	LA-Special Matters for Block E, Block F and Block G Aircraft in Table 1-A2
6-1162-LKJ-0707	LA- Agreement Regarding [*]		6
6-1162-LKJ-0709	[*] Special Matters		6

FED-PA-03712 SA-6

BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

SUPPLEMENTAL AGREEMENTS	DATED AS OF:
Supplemental Agreement No. 1	June 29, 2012
Supplemental Agreement No. 2	October 8, 2012
Supplemental Agreement No. 3	December 11, 2012
Supplemental Agreement No. 4	December 10, 2013
Supplemental Agreement No. 5	September 29, 2014
Supplemental Agreement No. 6	July 21, 2015

FED-PA-03712 SA-6

BOEING PROPRIETARY

Table 1-A2 To

Purchase Agreement No. 3712

Aircraft Delivery, Description, Price and Advance Payments

Block E, Block F and Block G Aircraft

Airframe Model/MTOW:	767-300F		408,000 pounds
Engine Model/Thrust:	CF6-80C2B6F		60,200 pounds
Airframe Price:			[*]
Optional Features:			[*]
Sub-Total of Airframe and Features:			[*]
Engine Price (Per Aircraft):			[*]
Aircraft Basic Price (Excluding BFE/SPE):			[*]
Buyer Furnished Equipment (BFE) Estimate:			[*]
Seller Purchased Equipment (SPE):			[*]
Deposit per Aircraft:		$	0
			[*]

Detail Specification: D019T002FED63F-1, Rev D dated March 26, 2015
Airframe Price Base Year/Escalation Formula:	[*]		ECI-MFG/CPI
Engine Price Base Year/Escalation Formula:	[*]		GE CF6-80 & GE90 (99 rev.)
Airframe Escalation Data:
Base Year Index (ECI):		[*]
Base Year Index (CPI):		[*]
Engine Escalation Data:
Base Year Index (CPI):		[*]

		Escalation	Escalation		Escalation Estimate	Advance Payment Per Aircraft (Amts. Due/Mos. Prior to Delivery):
Delivery	Number of	Factor	Factor		Adv Payment Base	At Signing	24 Mos.	21/18/12/9/6 Mos.	Total
Date	Aircraft	(Airframe)	(Engine)	Block	Price Per A/P	1%	4%	5%	30%
[*]		[*]	[*]	Block E	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block E	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block E	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block E	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block E	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block E	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block E	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block E	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block E	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block E	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block E	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block E	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block E	[*]	[*]	[*]	[*]	[*]

		SA-6
FED-PA-03712 73706-1F.TXT	Boeing Proprietary	Page 1

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Table 1-A2 To

Purchase Agreement No. 3712

Aircraft Delivery, Description, Price and Advance Payments

Block E, Block F and Block G Aircraft

		Escalation	Escalation		Escalation Estimate	Advance Payment Per Aircraft (Amts. Due/Mos. Prior to Delivery):
Delivery	Number of	Factor	Factor		Adv Payment Base	At Signing	24 Mos.	21/18/12/9/6 Mos.	Total
Date	Aircraft	(Airframe)	(Engine)	Block	Price Per A/P	1%	4%	5%	30%
[*]		[*]	[*]	Block E	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block E	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block E	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block E	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block E	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block E	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block E	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block E	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block E	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block E	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block E	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block E	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block E	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block E	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block E	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block E	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block E	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block E	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block E	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block E	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block E	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block E	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block F	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block F	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block F	[*]	[*]	[*]	[*]	[*]

		SA-6
FED-PA-03712 73706-1F.TXT	Boeing Proprietary	Page 2

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Table 1-A2 To

Purchase Agreement No. 3712

Aircraft Delivery, Description, Price and Advance Payments

Block E, Block F and Block G Aircraft

		Escalation	Escalation		Escalation Estimate	Advance Payment Per Aircraft (Amts. Due/Mos. Prior to Delivery):
Delivery	Number of	Factor	Factor		Adv Payment Base	At Signing	24 Mos.	21/18/12/9/6 Mos.	Total
Date	Aircraft	(Airframe)	(Engine)	Block	Price Per A/P	1%	4%	5%	30%
[*]		[*]	[*]	Block F	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block F	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block F	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block F	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block F	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block F	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block F	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block F	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block G	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block G	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block G	[*]	[*]	[*]	[*]	[*]
[*]		[*]	[*]	Block G	[*]	[*]	[*]	[*]	[*]
Total:	50

		SA-6
FED-PA-03712 73706-1F.TXT	Boeing Proprietary	Page 3

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Table 1-B To

Purchase Agreement No. 3712

Aircraft Delivery, Description, Price and Advance Payments

Exercised Option Aircraft

Airframe Model/MTOW:	767-300F	40,8000 pounds
Engine Model/Thrust:	CF6-80C2B6F	60,200 pounds
Airframe Price:		[*]
Optional Features:		[*]
Sub-Total of Airframe and Features:		[*]
Engine Price (Per Aircraft):		[*]
Aircraft Basic Price (Excluding BFE/SPE):		[*]
Buyer Furnished Equipment (BFE) Estimate:		[*]
Seller Purchased Equipment (SPE) Estimate:		[*]
Deposit per Aircraft:		[*]

Detail Specification: D019T002FED63F-1, Rev D dated March 26, 2015
Airframe Price Base Year/Escalation Formula:	[*	]			ECI-MFG/CPI
Engine Price Base Year/Escalation Formula:	[*	]			GE CF6-80 & GE90 (99 rev.)
Airframe Escalation Data:
Base Year Index (ECI):			[*	]
Base Year Index (CPI):			[*	]
Engine Escalation Data:
Base Year Index (CPI):			[*	]

		Escalation	Escalation			Escalation Estimate	Advance Payment Per Aircraft (Amts. Due/Mos. Prior to Delivery):
Delivery	Number of	Factor	Factor			Adv Payment Base	At Signing	24 Mos.	21/18/12/9/6 Mos.	Total
Date	Aircraft	(Airframe)	(Engine)	Block	MSN	Price Per A/P	1%	4%	5%	30%
[*]	1	[*]	[*]	Block C	43538	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	Block C	43541	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	Block C	43551	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	Block B *	43630 *	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	Block C	43552	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	Block B	43631	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	Block B	43632	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	Block C	43553	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	Block C	43554	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	Block B	43633	[*]	[*]	[*]	[*]	[*]
	10

* The Determination Date for MSN 43630 has passed and the special provision pursuant to Letter Agreement 6-1162-SCR-146, Special Provision - Block B Aircraft, has expired.

		SA-6
FED-PA-03712 57361-1F.TXT	Boeing Proprietary	Page 1

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

	The Boeing Company
	P.O. Box 3707
	Seattle, WA 98124-2207

FED-PA-03712-LA-1106151R2

Federal Express Corporation

3610 Hacks Cross

Memphis, TN 38125

Subject:	Special Matters Concerning [*] – Option Aircraft and Certain Purchase Right Aircraft
Reference:	Purchase Agreement No. 3712 (Purchase Agreement) between The Boeing Company (Boeing) and Federal Express Corporation (Customer) relating to Model 767-3S2F aircraft (Aircraft)

This letter agreement (Letter Agreement) amends and supplements the Purchase Agreement. In addition, this Letter Agreement cancels and supersedes Letter Agreement FED-PA-03712-LA-1106151R1 in its entirety. All terms used but not defined in this Letter Agreement shall have the same meaning as in the Purchase Agreement. The terms provided in this Letter Agreement will be applicable to exercised Option Aircraft, as identified in the Table 1-B and Table 1-B1 of the Purchase Agreement (Exercised Option Aircraft) and Purchase Right Aircraft, as identified in Table 1-C that are exercised and scheduled for delivery to Customer through [*] (Applicable Purchase Right Aircraft).

1. [*]

1.1 Boeing will [*] for the Airframe Price and Optional Features Prices of each Exercised Option Aircraft and Applicable Purchase Right Aircraft for the period beginning [*] and continuing through [*], in accordance with the terms of this Letter Agreement.

1.2 Notwithstanding the [*], in the event Boeing reschedules an Exercised Option Aircraft delivery outside the [*] pursuant to the delivery flexibility described in Letter Agreement Option Aircraft (FED-PA-03712-LA-1106156R2) Boeing agrees that the [*] will extend to apply to such rescheduled Exercised Option Aircraft.

1.3 For the avoidance of doubt, in the event of an Excusable Delay or Non-Excusable Delay of an Exercised Option Aircraft or Applicable Purchase Right Aircraft, Boeing and Customer acknowledge that the [*] to the contracted delivery month will be applied to such Exercised Option Aircraft or Applicable Purchase Right Aircraft.

1.4 If Boeing and Customer mutually agree to reschedule an Exercised Option Aircraft or Applicable Purchase Right Aircraft within the [*], the affected Exercised Option Aircraft or Applicable Purchase Right Aircraft will continue to receive the [*] described herein, [*] to the rescheduled delivery month.

1.5 The [*] for the Airframe Price and Optional Features Price of each Exercised Option Aircraft and Applicable Purchase Right Aircraft will be [*] during the [*] at a [*].

FED-PA-03712-LA-1106151R2		SA-6
Special Matters Concerning [*] – Option Aircraft and Certain Purchase Right Aircraft		Page 1
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

2. Determining [*] for Aircraft Delivering Within the [*].

2.1 For Exercised Option Aircraft and Applicable Purchase Right Aircraft delivering within the [*], Boeing will, at time of Exercised Option Aircraft or Applicable Purchase Right Aircraft delivery, calculate the [*] of the Airframe Price and Optional Features Price using (i) [*] in accordance with the provisions of [*] to the Purchase Agreement [*] and (ii) the [*]. The final Aircraft Price will include the [*] Airframe Price and Optional Features Price utilizing the [*] or the [*], except as set forth below.

2.2 Notwithstanding paragraph 2.1 above, if [*] calculated pursuant to the [*], Customer will [*] on the Airframe Price and Optional Features Price [*] on the applicable Exercised Option Aircraft or Applicable Purchase Right Aircraft; or

2.3 If [*] calculated pursuant to the [*], Customer will [*] on the Airframe Price and Optional Features Price [*] on the applicable Exercised Option Aircraft or Applicable Purchase Right Aircraft. At least eighteen [*] of an Exercised Option Aircraft or Applicable Purchase Right Aircraft, but not [*] of a Exercised Option Aircraft or Applicable Purchase Right Aircraft, Boeing will provide Customer notification in the event the [*].

2.4 For an example of the determination of escalation factor applicable to the Airframe and Optional Features, refer to Attachment C to this Letter Agreement.

3. Effect on Advance Payments.

The amount and timing of advance payments Customer is required to pay to Boeing pursuant to the Purchase Agreement shall be unaffected by any terms set forth in this Letter Agreement.

4. Aircraft Applicability.

Unless otherwise stated, the terms of this Letter Agreement shall only apply to the Exercised Option Aircraft and Applicable Purchase Right Aircraft.

5. Applicability to Other Financial Consideration.

The escalation adjustment for any other sum identified in the Purchase Agreement as subject to escalation pursuant to Supplemental Exhibit AE1, and which pertains to an Exercised Option Aircraft and Applicable Purchase Right Aircraft, shall be calculated using the escalation methodology established in this Letter Agreement notwithstanding any other provisions of the Purchase Agreement to the contrary.

FED-PA-03712-LA-1106151R2		SA-6
Special Matters Concerning [*] – Option Aircraft and Certain Purchase Right Aircraft		Page 2
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

6. Confidential Treatment.

Customer understands that Boeing considers certain commercial and financial information contained in this Letter Agreement as confidential. Each of Customer and Boeing agree that it will treat this Letter Agreement and the information contained herein as confidential. Customer agrees to limit the disclosure of the contents of this Letter Agreement to employees of Customer with a need to know and who understand that they are not to disclose its content to any other person or entity without the prior written consent of Boeing. Notwithstanding the foregoing, Customer may disclose this Letter Agreement and the terms and conditions herein to its parent company, FedEx Corporation, to the Board of Directors of its parent corporation, FedEx Corporation, to its professional advisors under a duty of confidentiality with respect thereto, and as required by law.

FED-PA-03712-LA-1106151R2		SA-6
Special Matters Concerning [*] – Option Aircraft and Certain Purchase Right Aircraft		Page 3
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Very truly yours,

THE BOEING COMPANY
By	/s/ Kirsten Jensen
Its	Attorney-In-Fact
ACCEPTED AND AGREED TO this
Date:	July 21, 2015
FEDERAL EXPRESS CORPORATION
By	/s/ Phillip C. Blum
Its	Vice President Aircraft Acquisition

Attachments A, B and C

FED-PA-03712-LA-1106151R2		SA-6
Special Matters Concerning [*] – Option Aircraft and Certain Purchase Right Aircraft		Page 4
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Attachment A to Letter Agreement FED-PA-03712-LA-1106151R2

[*]

FED-PA-03712-LA-1106151R2		SA-6
Attachment A
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Attachment B to Letter Agreement FED-PA-03712-LA-1106151R2

[*]

FED-PA-03712-LA-1106151R2		SA-6
Attachment B
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Attachment C to Letter Agreement FED-PA-03712-LA-1106151R2

ESCALATION EXAMPLE

[*]

FED-PA-03712-LA-1106151R2		SA-6
Attachment C
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

	The Boeing Company
	P.O. Box 3707
	Seattle, WA 98124-2207

FED-PA-03712-LA-1106154R2

Federal Express Corporation

3610 Hacks Cross

Memphis TN 38125

Subject:	Firm Aircraft and Option Aircraft Delivery Matters
Reference:	Purchase Agreement No. 3712 (Purchase Agreement) between The Boeing Company (Boeing) and Federal Express Corporation (Customer) relating to Model 767-3S2F aircraft (Aircraft)

This letter agreement (Letter Agreement) amends and supplements the Purchase Agreement. In addition, this Letter Agreement cancels and supersedes Letter Agreement FED-PA-03712-LA-1106154R1 in its entirety. All terms used but not defined in this Letter Agreement shall have the same meaning as in the Purchase Agreement. The information provided in this Letter Agreement will be applicable to the firm Aircraft identified in Tables of the Purchase Agreement only (Firm Aircraft).

1. INTENTIONALLY DELETED.

2. INTENTIONALLY DELETED.

3. Firm Aircraft and Option Aircraft Scheduled to Deliver after [*]. Notwithstanding Firm Aircraft delivery dates as provided in the Tables and Option Aircraft delivery months provided in Letter Agreement FED-PA-03712-LA-1106156R2, Option Aircraft, that reflect deliveries after [*], Boeing reserves the right to [*]. Notwithstanding anything herein or elsewhere to the contrary, the parties specifically agree to the following: (i) [*]

4. Customer Delivery Constraints. Notwithstanding Article 3 of this Letter Agreement, Boeing will not [*].

5. [*]. Upon request from Boeing, Customer agrees to discuss [*].

6. Confidential Treatment.

Customer understands that Boeing considers certain commercial and financial information contained in this Letter Agreement as confidential. Each of Customer and Boeing agree that it will treat this Letter Agreement and the information contained herein as confidential. Customer agrees to limit the disclosure of the contents of this Letter Agreement to employees of Customer with a need to know and who understand that they are not to disclose its content to any other person or entity without the prior written

FED-PA-03712-LA-1106154R2		SA-6
Firm Aircraft and Option Aircraft Delivery Matters		Page 1
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

consent of Boeing. Notwithstanding the foregoing, Customer may disclose this Letter Agreement and the terms and conditions herein to its parent company, FedEx Corporation, to the Board of Directors of its parent corporation, FedEx Corporation, to its professional advisors under a duty of confidentiality with respect thereto, and as required by law.

FED-PA-03712-LA-1106154R2		SA-6
Firm Aircraft and Option Aircraft Delivery Matters		Page 2
	BOEING PROPRIETARY

Very truly yours,

THE BOEING COMPANY
By	/s/ Kirsten Jensen
Its	Attorney-In-Fact
ACCEPTED AND AGREED TO this
Date:	July 21, 2015
FEDERAL EXPRESS CORPORATION
By	/s/ Phillip C. Blum
Its	Vice President Aircraft Acquisition

FED-PA-03712-LA-1106154R2		SA-6
Firm Aircraft and Option Aircraft Delivery Matters		Page 3
	BOEING PROPRIETARY

	The Boeing Company
	P.O. Box 3707
	Seattle, WA 98124-2207

FED-PA-03712-LA-1106156R2

Federal Express Corporation

3610 Hacks Cross

Memphis, TN 38125

Subject:	Option Aircraft
Reference:	Purchase Agreement No. 3712 (Purchase Agreement) between The Boeing Company (Boeing) and Federal Express Corporation (Customer) relating to Model 767-3S2F aircraft (Aircraft)

This letter agreement (Letter Agreement) amends and supplements the Purchase Agreement. In addition, this Letter Agreement cancels and supersedes FED-PA-03712-LA-1106156R1 in its entirety. All terms used but not defined in this Letter Agreement shall have the same meaning as in the Purchase Agreement.

1. Right to Purchase Option Aircraft.

Subject to the terms and conditions contained in this Letter Agreement, Customer has the option to purchase thirty-five (35) additional Model 767-3S2F aircraft as option aircraft (Option Aircraft) and fifteen (15) additional Model 767-3S2F aircraft as Block D option aircraft (Block D Option Aircraft). Except as set forth herein, and in the Purchase Agreement, the Block D Option Aircraft are considered Option Aircraft.

2. Delivery.

The number of Option Aircraft and associated delivery months are listed in the Attachment 1 to this Letter Agreement. The number of Block D Option Aircraft and associated delivery months are listed in the Attachment 2 to this Letter Agreement.

3. Configuration.

The configuration for the Option Aircraft will be the Detail Specification for model 767-3S2F aircraft at the revision level in effect at the time of Supplemental Agreement. Such Detail Specification will be revised to include (i) changes required to obtain required regulatory certificates and (ii) other changes as mutually agreed upon by Customer and Boeing.

4. Price.

4.1 The Airframe Price, Engine Price, Optional Features Prices, and Aircraft Basic Price for each of the Option Aircraft shall remain in base year [*] and such prices will be subject to escalation in accordance with the Purchase Agreement.

FED-PA-03712-LA-1106156R2		SA-6
Option Aircraft		Page 1
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

4.2 Subject to the provisions of Letter Agreement FED-PA-03712-LA-1106151R2 titled “Special Matters Concerning [*] – Option Aircraft and Certain Purchase Right Aircraft” the Airframe Price, Engine Price, Optional Features Prices, and Aircraft Basic Price for each of the Option Aircraft will be adjusted for escalation in accordance with the Purchase Agreement.

4.3 The Advance Payment Base Price for each exercised Option Aircraft shall be developed in accordance with the terms of the Purchase Agreement and determined at the time of Supplemental Agreement.

5. Payment.

5.1 Customer will pay an option deposit to Boeing in the amount of [*] (Option Deposit) for each of the fifteen (15) Option Aircraft added to the Purchase Agreement pursuant to Supplemental Agreement No. 6 to the Purchase Agreement (SA-6). The parties acknowledge that Customer has previously paid an Option Deposit to Boeing in the amount of [*] for (i) each of the fifteen Block D Option Aircraft added to the Purchase agreement pursuant to Supplemental Agreement No. 1 to the Purchase Agreement, and (ii) each of the twenty (20) Option Aircraft in Attachment 1 prior to the execution of SA-6. If Customer exercises an option, the Option Deposit will be credited against the first advance payment due. [*].

5.2 At Supplemental Agreement for the Option Aircraft, advance payments will be payable as specified in the Purchase Agreement. The remainder of the Aircraft Price for the Option Aircraft will be paid at the time of delivery.

6. Option Exercise.

6.1 Customer will exercise [*], by giving written notice to Boeing on or before the first business day of the month that is [*] months prior to the month of delivery [*] (Option Exercise Date). [*].

6.2 [*]

6.3 The parties agree that Option Aircraft, once exercised, will be added to Table 1-B or Table 1-B1, as applicable, of the Purchase Agreement.

7. [*]

8. [*]

FED-PA-03712-LA-1106156R2		SA-6
Option Aircraft		Page 2
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

9. Supplemental Agreement.

Following Customer’s exercise of an option the parties will sign a supplemental agreement for the purchase of such Option Aircraft (Supplemental Agreement). The Supplemental Agreement will include the provisions of the Purchase Agreement as modified to reflect the provisions of this Letter Agreement.

10. Confidential Treatment.

Customer understands that Boeing considers certain commercial and financial information contained in this Letter Agreement as confidential. Each of Customer and Boeing agree that it will treat this Letter Agreement and the information contained herein as confidential. Customer agrees to limit the disclosure of the contents of this Letter Agreement to employees of Customer with a need to know and who understand that they are not to disclose its content to any other person or entity without the prior written consent of Boeing. Notwithstanding the foregoing, Customer may disclose this Letter Agreement and the terms and conditions herein to its parent company, FedEx Corporation, to the Board of Directors of its parent corporation, FedEx Corporation, to its professional advisors under a duty of confidentiality with respect thereto, and as required by law.

FED-PA-03712-LA-1106156R2		SA-6
Option Aircraft		Page 3
	BOEING PROPRIETARY

Very truly yours,

THE BOEING COMPANY
By	/s/ Kirsten Jensen
Its	Attorney-In-Fact
ACCEPTED AND AGREED TO this
Date:	July 21, 2015
FEDERAL EXPRESS CORPORATION
By	/s/ Phillip C. Blum
Its	Vice President Aircraft Acquisition

Attachments

FED-PA-03712-LA-1106156R2		SA-6
Option Aircraft		Page 4
	BOEING PROPRIETARY

Attachment 1 to

Letter Agreement No. FED-PA-03712-LA-1106156R2

Option Aircraft Delivery, Description, Price and Advance Payments

Airframe Model/MTOW:	767-300F	408,000 pounds
Engine Model/Thrust:	CF6-80C2B6F	60,200 pounds
Airframe Price:		[*	]
Optional Features:		[*	]
Sub-Total of Airframe and Features:		[*	]
Engine Price (Per Aircraft):		[*	]
Aircraft Basic Price (Excluding BFE/SPE):		[*	]
Buyer Furnished Equipment (BFE) Estimate:		[*	]
Seller Purchased Equipment (SPE) Estimate:		[*	]
Deposit per Aircraft:		[*	]

Detail Specification: D019T002FED63F-1, Rev D dated March 26, 2015
Airframe Price Base Year/Escalation Formula:	[*]		ECI-MFG/CPI
Engine Price Base Year/Escalation Formula:	[*]		GE CF6-80 & GE90 (99 rev.)
Airframe Escalation Data:
Base Year Index (ECI):		[*]
Base Year Index (CPI):		[*]
Engine Escalation Data:
Base Year Index (CPI):		[*]

		Escalation	Escalation	Escalation Estimate	Advance Payment Per Aircraft (Amts. Due/Mos. Prior to Delivery):
Delivery	Number of	Factor	Factor	Adv Payment Base	At Signing	24 Mos.	21/18/12/9/6 Mos.	Total
Date	Aircraft	(Airframe)	(Engine)	Price Per A/P	1%	4%	5%	30%
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]

		SA-6
FED-PA-03712-LA-1106156R2 73706-1O.TXT	Boeing Proprietary	Page 1

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Attachment 1 to

Letter Agreement No. FED-PA-03712-LA-1106156R2

Option Aircraft Delivery, Description, Price and Advance Payments

		Escalation	Escalation	Escalation Estimate	Advance Payment Per Aircraft (Amts. Due/Mos. Prior to Delivery):
Delivery	Number of	Factor	Factor	Adv Payment Base	At Signing	24 Mos.	21/18/12/9/6 Mos.	Total
Date	Aircraft	(Airframe)	(Engine)	Price Per A/P	1%	4%	5%	30%
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Total:	35

		SA-6
FED-PA-03712-LA-1106156R2 73706-1O.TXT	Boeing Proprietary	Page 2

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Attachment 2 to

Letter Agreement No. FED-PA-03712-LA-11106156R2

Aircraft Delivery, Description, Price and Advance Payments Block D Option Aircraft

Airframe Model/MTOW:	767-300F	408,000 pounds
Engine Model/Thrust:	CF6-80C2B6F	60,200 pounds
Airframe Price:		[*	]
Optional Features:		[*	]
Sub-Total of Airframe and Features:		[*	]
Engine Price (Per Aircraft):		[*	]
Aircraft Basic Price (Excluding BFE/SPE):		[*	]
Buyer Furnished Equipment (BFE) Estimate:		[*	]
Seller Purchased Equipment (SPE) Estimate:		[*	]
Deposit per Aircraft:		[*	]

Detail Specification: D019T002FED63F-1, Rev D dated March 26, 2015
Airframe Price Base Year/Escalation Formula:	[*]		ECI-MFG/CPI
Engine Price Base Year/Escalation Formula:	[*]		GE CF6-80 & GE90 (99 rev.)
Airframe Escalation Data:
Base Year Index (ECI):		[*]
Base Year Index (CPI):		[*]
Engine Escalation Data:
Base Year Index (CPI):		[*]

		Escalation	Escalation	Escalation Estimate	Advance Payment Per Aircraft (Amts. Due/Mos. Prior to Delivery):
Delivery	Number of	Factor	Factor	Adv Payment Base	At Signing	24 Mos.	21/18/12/9/6 Mos.	Total
Date	Aircraft	(Airframe)	(Engine)	Price Per A/P	1%	4%	5%	30%
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
[*]	1	[*]	[*]	[*]	[*]	[*]	[*]	[*]
Total:	15

Note: the above Block D Option Aircraft, if and when exercised by Customer, are subject to the terms of letter agreement FED-PA-03712-LA-1208296R2.

		SA-6
FED-PA-03712-LA-1106156R2 73706-1O.TXT	Boeing Proprietary	Page 1

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Attachment 3 to

Letter Agreement No. FED-PA-03712-LA-1106156R2

[*]

Notes:

(i) FED Customer Fiscal Year June 1 – May 31

(ii) See paragraph 6.2 of Letter Agreement FED-PA-03712-LA-1106156R2 for [*]

[*]

FED-PA-03712-LA-1106156R2		SA-6
Option Aircraft		Attachment 3 Page 1
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Attachment 4 to

Letter Agreement No. FED-PA-03712-LA-1106156R2

Firm Aircraft and Option Aircraft Delivery Schedule

[*]

Notes:

(i) FY: FED Customer Fiscal Year June 1 – May 31

(ii) Customer has the right to purchase fifty (50) Purchase Right Aircraft for delivery through [*]

FED-PA-03712-LA-1106156R2		SA-6
Option Aircraft		Attachment 4 Page 1
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

	The Boeing Company
	P.O. Box 3707
	Seattle, WA 98124-2207

FED-PA-03712-LA-1106158R2

Federal Express Corporation

3610 Hacks Cross

Memphis, TN 38125

Subject:	Right to Purchase Additional Aircraft
Reference:	Purchase Agreement No. 3712 (Purchase Agreement) between The Boeing Company (Boeing) and Federal Express Corporation (Customer) relating to Model 767-3S2F aircraft (Aircraft)

This letter agreement (Letter Agreement) amends and supplements the Purchase Agreement. In addition, this Letter Agreement cancels and supersedes FED-PA-03712-LA-1106158R1 in its entirety. All terms used but not defined in this Letter Agreement shall have the same meaning as in the Purchase Agreement.

1. Right to Purchase Incremental Aircraft.

Subject to the terms and conditions contained herein, Customer will have the right to purchase (Purchase Right) fifty (50) additional Boeing Model 767-3S2F aircraft as purchase right aircraft (Purchase Right Aircraft).

2. Delivery.

The Purchase Right Aircraft delivery positions are [*].

3. Configuration.

The configuration for the Purchase Right Aircraft will be the Detail Specification for Model 767-3S2F aircraft at the revision level in effect at the time of the Supplemental Agreement. Such Detail Specification will be revised to include (i) changes required to obtain required regulatory certificates and (ii) other changes as mutually agreed upon by Boeing and Customer.

4. Price.

4.1 The Airframe Price, Engine Price, Optional Features Prices, and Aircraft Basic Price for the Purchase Right Aircraft shall remain in base year [*] and such prices will be subject to escalation to the scheduled delivery date of the Purchase Right Aircraft.

FED-PA-03712-LA-1106158R2		SA-6
Right to Purchase Additional Aircraft		Page 1
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

4.2 Subject to the provisions of Letter Agreement FED-PA-03712-LA-1106151R2 “Special Matters Concerning [*] – Option Aircraft and Certain Purchase Right Aircraft”, the Airframe Price, Engine Price, Optional Features Prices, and Aircraft Basic Price for each of the Purchase Right Aircraft will be adjusted for escalation in accordance with the Purchase Agreement.

4.3 The Advance Payment Base Price for each exercised Purchase Right Aircraft shall be developed in accordance with the terms of the Purchase Agreement and determined at the time of Supplemental Agreement.

5. Payment.

At Supplemental Agreement for the Purchase Right Aircraft, advance payments will be payable as specified in the Purchase Agreement. The remainder of the Aircraft Price for the Purchase Right Aircraft will be paid at the time of delivery.

6. Notice of Exercise and Payment of Deposit.

6.1 Customer may exercise a Purchase Right by giving written notice (Notice of Exercise) to Boeing. All Purchase Right aircraft must be exercised for delivery no later than [*]. Such Notice of Exercise shall be accompanied by payment, by electronic transfer to the account specified below, in accordance with the Purchase Agreement. Such amount will be the initial advance payment due at execution of the Supplemental Agreement.

[*]

6.2 The parties agree that Purchase Right Aircraft, once exercised, will be added to Table 1-C of the Purchase Agreement.

7. Supplemental Agreement.

Following Customer’s exercise of a Purchase Right in accordance with the terms and conditions stated herein [*], the parties will sign a supplemental agreement for the purchase of such Purchase Right Aircraft (Supplemental Agreement) within thirty (30) calendar days of such exercise (Purchase Right Exercise). The Supplemental Agreement will include the provisions then contained in the Purchase Agreement as modified to reflect the provisions of this Letter Agreement and any additional mutually agreed terms and conditions.

FED-PA-03712-LA-1106158R2		SA-6
Right to Purchase Additional Aircraft		Page 2
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

8. [*]

9. General Expiration of Rights.

Each Purchase Right shall expire at the time of execution of the Supplemental Agreement for the applicable Purchase Right Aircraft, or, if no such Supplemental Agreement is executed, on [*].

10. Confidential Treatment.

Customer understands that Boeing considers certain commercial and financial information contained in this Letter Agreement as confidential. Each of Customer and Boeing agree that it will treat this Letter Agreement and the information contained herein as confidential. Customer agrees to limit the disclosure of the contents of this Letter Agreement to employees of Customer with a need to know and who understand that they are not to disclose its content to any other person or entity without the prior written consent of Boeing. Notwithstanding the foregoing, Customer may disclose this Letter Agreement and the terms and conditions herein to its parent company, FedEx Corporation, to the Board of Directors of its parent corporation, FedEx Corporation, to its professional advisors under a duty of confidentiality with respect thereto, and as required by law.

FED-PA-03712-LA-1106158R2		SA-6
Right to Purchase Additional Aircraft		Page 3
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Very truly yours,

THE BOEING COMPANY
By	/s/ Kirsten Jensen
Its	Attorney-In-Fact
ACCEPTED AND AGREED TO this
Date:	July 21, 2015
FEDERAL EXPRESS CORPORATION
By	/s/ Phillip C. Blum
Its	Vice President Aircraft Acquisition

FED-PA-03712-LA-1106158R2		SA-6
Right to Purchase Additional Aircraft		Page 4
	BOEING PROPRIETARY

	The Boeing Company
	P.O. Box 3707
	Seattle, WA 98124-2207

FED-PA-03712-LA-1106177R1

Federal Express Corporation

3610 Hacks Cross Road

Memphis, TN 38125

Subject:	[*]
Reference:	Purchase Agreement No. 3712 (Purchase Agreement) between The Boeing Company (Boeing) and Federal Express Corporation (Customer) relating to Model 767-3S2 Freighter aircraft (Aircraft)

This letter agreement (Letter Agreement) amends and supplements the Purchase Agreement. All terms used but not defined in this Letter Agreement shall have the same meaning as in the Purchase Agreement.

Boeing and Customer wish to enter into an agreement pursuant to which each party will [*] as more specifically provided below.

1. Definitions.

[*]

2. [*]

3. [*]

4. Assignment.

Notwithstanding any other provisions of the Purchase Agreement, the rights and obligations described in this Letter Agreement are provided to Customer in consideration of Customer’s becoming the operator of the Aircraft and cannot be assigned in whole or, in part. For the purpose of supporting Customer’s operation of the Aircraft, Boeing agrees that the rights and obligations described in this Letter Agreement may be assigned, in whole or in part, to any subsidiary of the FedEx Corporation.

FED-PA-03712-LA-1106177R1		SA-6
[*]		Page 1
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

5. Confidential Treatment.

Customer understands that Boeing considers certain commercial and financial information contained in this Letter Agreement as confidential. Each of Customer and Boeing agree that it will treat this Letter Agreement and the information contained herein as confidential. Customer agrees to limit the disclosure of the contents of this Letter Agreement to employees of Customer with a need to know and who understand that they are not to disclose its content to any other person or entity without the prior written consent of Boeing. Notwithstanding the forgoing, Customer may disclose this Letter Agreement and the terms and conditions herein to its parent company, FedEx Corporation, to the Board of Directors of its parent corporation, FedEx Corporation, to its professional advisors under a duty of confidentiality with respect hereto, and as required by law.

Very truly yours,

THE BOEING COMPANY
By	/s/ Kirsten Jensen
Its	Attorney-In-Fact
ACCEPTED AND AGREED TO this
Date:	July 21, 2015
Federal Express Corporation
By	/s/ Phillip C. Blum
Its	Vice President

FED-PA-03712-LA-1106177R1		SA-6
[*]		Page 2
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

	The Boeing Company
	P.O. Box 3707
	Seattle, WA 98124-2207

FED-PA-03712-LA-1106574R1

Federal Express Corporation

3610 Hacks Cross Road

Memphis, TN 38125

Subject:	Agreement for Deviation from the [*]
Reference:	Purchase Agreement No. 3712 (Purchase Agreement) between The Boeing Company (Boeing) and Federal Express Corporation (Customer) relating to Model 767-3S2 Freighter firm aircraft (Aircraft)

This letter agreement (Letter Agreement) amends and supplements the Purchase Agreement. In addition, this Letter Agreement cancels and supersedes FED-PA-03712-LA-06574 in its entirety. All terms used but not defined in this Letter Agreement shall have the same meaning as in the Purchase Agreement.

The Attachment to Letter Agreement No FED-PA-03712-LA-1106584R4 contains performance guarantees (Performance Guarantees). [*] applicable to the Aircraft in accordance with such Performance Guarantees. Boeing offers the following items in the event that the guarantee compliance report furnished to Customer for any Aircraft pursuant to Article 5.4 of the AGTA shows [*].

1. Demonstration of Compliance.

Article 5.4 of the AGTA and the Performance Guarantees provide a procedure for demonstration of compliance with the Performance Guarantees prior to Aircraft delivery. That method will be used to demonstrate compliance with the [*].

2. Rights and Obligations in the Event of a Compliance Deviation.

2.1 Aircraft Delivery. In the event of a Compliance Deviation for any Aircraft, at the time Boeing tenders that Aircraft for delivery, Boeing will provide the applicable remedies set forth in paragraph 2.2 and section 3. Customer cannot refuse to accept delivery of such Aircraft because of such Compliance Deviation.

FED-PA-03712-LA-1106574R1		SA-6
Agreement for Deviation from the [*]		Page 1
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

2.2 Post Delivery Improvement to Reduce or Eliminate the Compliance Deviation. In the event of a Compliance Deviation for any Aircraft, the following terms and conditions will apply:

2.2.1 To the extent Boeing reasonably determines it is economically and technically practicable, Boeing will use reasonable efforts to design, or cause to be designed by engine manufacturer, airplane drag improvement parts and/or engine fuel flow improvement parts (Improvement Parts) which, when installed in such Aircraft, would reduce or eliminate the Compliance Deviation.

2.2.2 If Boeing elects to provide, or to cause to be provided, Improvement Parts for such Aircraft, then Customer and Boeing will mutually agree upon the details of an Improvement Parts program. Improvement Parts [*]; except Improvement Parts that are provided by the engine manufacturer [*]. Boeing and/or engine manufacturer, as applicable, will provide reasonable support for such a program [*].

2.2.3 If Customer elects to install Improvement Parts in such Aircraft, they will be installed within [*] after the delivery of such Improvement Parts to Customer if such installation can be accomplished during Aircraft line maintenance. Improvement Parts which cannot be installed during Aircraft line maintenance will be installed within a mutually agreed period of time. All Improvement Parts will be installed in accordance with Boeing and engine manufacturer instructions.

2.2.4 Boeing will provide and/or will cause engine manufacturer to provide [*]. Improvement Parts related to engines will apply also to spare engines [*]. Boeing and/or the engine manufacturer, as applicable, will give Customer reasonable advance written notice of the estimated on-dock date at Customer’s maintenance base for any such Improvement Parts. Customer’s [*] must reference this Letter Agreement and be submitted to Boeing Warranty and Product Assurance Contracts using established warranty procedures and other terms identified in the Improvement Parts program contemplated in paragraph 2.2.2 herein.

3. Payments.

In the event that Boeing has not provided, or caused to be provided by the engine manufacturer, Improvement Parts which eliminate the Compliance Deviation, then Boeing will provide only the remedies described in this section 3.

3.1 [*]

3.1.1 [*]

3.1.2 Customer will provide to Boeing, [*].

3.1.3 Boeing will review the [*]. At its option, Boeing may request additional information from Customer to further substantiate the [*]. Such additional information will not be unreasonably requested by Boeing, nor unreasonably withheld by Customer.

FED-PA-03712-LA-1106574R1		SA-6
Agreement for Deviation from the [*]		Page 2
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

3.2 [*]. In no event [*] set forth in the Attachment A hereto [*].

3.3 [*]. The amount of performance improvement attributable to any Improvement Parts will be determined by Boeing analysis based on data certified to be correct by Boeing. The amount of such improvement will be deemed to be the amount of improvement as calculated using reasonable engineering interpretations based on the data furnished pursuant to Article 5.4 of the AGTA and the data furnished pursuant to this paragraph 3.3. If Customer elects not to install Improvement Parts in any applicable Aircraft as set forth in paragraph 2.2 above, [*].

4. Duplication of Benefits.

If compensation becomes available to Customer under more than one Boeing guarantee, engine manufacturer guarantee, or warranty, Customer will not receive duplicative compensation, but will receive the compensation most beneficial to Customer.

5. Exclusive Remedy.

Customer agrees that the remedies contained in Sections 2 and 3 are Customer’s exclusive remedies for purposes of resolving all issues with respect to the Performance Guarantees of Customer’s Aircraft and are in lieu of all other rights, remedies, claims and causes of action Customer may have in connection therewith. Customer releases Boeing and its successors, affiliates and subsidiaries from all present, past and future rights, remedies, claims and causes of action, whether arising at law or otherwise, known or unknown, relating to or arising from such Performance Guarantees.

6. Confidential Treatment.

Customer understands that Boeing considers certain commercial and financial information contained in this Letter Agreement as confidential. Each of Customer and Boeing agree that it will treat this Letter Agreement and the information contained herein as confidential. Customer agrees to limit the disclosure of the contents of this Letter Agreement to employees of Customer with a need to know and who understand that they are not to disclose its content to any other person or entity without the prior written consent of Boeing. Notwithstanding the forgoing, Customer may disclose this Letter Agreement and the terms and conditions herein to its parent company, FedEx

FED-PA-03712-LA-1106574R1		SA-6
Agreement for Deviation from the [*]		Page 3
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Corporation, to the Board of Directors of its parent corporation, FedEx Corporation, to its professional advisors under a duty of confidentiality with respect hereto, and as required by law.

If the foregoing correctly sets forth your understanding of our agreement with respect to the matters treated above, please indicate your acceptance and approval below.

Very truly yours,

THE BOEING COMPANY
By	/s/ Kirsten Jensen
Its	Attorney-In-Fact
ACCEPTED AND AGREED TO this
Date:	July 21, 2015
FEDERAL EXPRESS CORPORATION
By	/s/ Phillip C. Blum
Its	Vice President

FED-PA-03712-LA-1106574R1		SA-6
Agreement for Deviation from the [*]		Page 4
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Attachment A to Letter Agreement No FED-PA-03712-LA-1106574R1

Page 1

[*]

NOTE: Any rounding of a number, as required under this Attachment with respect to escalation of the AAL, shall be accomplished as follows: If the first digit of the portion to be dropped from the number to be rounded is five or greater, the preceding digit shall be raised to the next higher number.

FED-PA-03712-LA-1106574R1		SA-6
Agreement for Deviation from the [*]		Page 5
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

	The Boeing Company
	P.O. Box 3707
	Seattle, WA 98124-2207

FED-PA-03712-LA-1106584R4

Federal Express Corporation

3610 Hacks Cross Road

Memphis, TN 38125

Subject:	Aircraft Performance Guarantees
Reference:	Purchase Agreement No. 3712 (Purchase Agreement) between The Boeing Company (Boeing) and Federal Express Corporation (Customer) relating to Model 767-3S2F firm aircraft listed on Table 1-A, Table 1-A1, 1-A2 and Table 1-B or as otherwise agreed by Boeing and Customer in writing (Aircraft)

This letter agreement (Letter Agreement) amends and supplements the Purchase Agreement. In addition, this Letter Agreement cancels and supersedes FED-PA-03712-LA-1106584R3 in its entirety. All terms used but not defined in this Letter Agreement shall have the same meaning as in the Purchase Agreement.

Boeing agrees to provide Customer with the performance guarantees in the Attachment. These guarantees are exclusive and expire upon delivery of the Aircraft to Customer. Customer agrees to limit the remedy for non-compliance of any performance guarantee to the terms in Letter Agreements No. FED-PA-03712-LA-1106153 entitled “Liquidated Damages – Non-Excusable Delay” and FED-PA-03712-LA-1106574R1 entitled “Agreement for Deviation from the [*].”

Confidential Treatment.

Customer understands that Boeing considers certain commercial and financial information contained in this Letter Agreement as confidential. Each of Customer and Boeing agree that it will treat this Letter Agreement and the information contained herein as confidential. Customer agrees to limit the disclosure of the contents of this Letter Agreement to employees of Customer with a need to know and who understand that they are not to disclose its content to any other person or entity without the prior written consent of Boeing. Notwithstanding the foregoing, Customer may disclose this Letter Agreement and the terms and conditions herein to its parent company, FedEx Corporation, to the Board of Directors of its parent corporation, FedEx Corporation, to its professional advisors under a duty of confidentiality with respect thereto, and as required by law.

FED-PA-03712-LA-1106584R4		SA-6
Aircraft Performance Guarantees		Page 1
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Very truly yours,

THE BOEING COMPANY
By	/s/ Kirsten Jensen
Its	Attorney-In-Fact
ACCEPTED AND AGREED TO this
Date:	July 21, 2015
FEDERAL EXPRESS CORPORATION
By	/s/ Phillip C. Blum
Its	Vice President Aircraft Acquisition

FED-PA-03712-LA-1106584R4		SA-6
Aircraft Performance Guarantees		Page 2
	BOEING PROPRIETARY

MODEL 767-300 FREIGHTER PERFORMANCE GUARANTEES

FOR FEDERAL EXPRESS CORPORATION

SECTION	CONTENTS
1	AIRCRAFT MODEL APPLICABILITY
2	FLIGHT PERFORMANCE
3	MANUFACTURER’S EMPTY WEIGHT
4	SOUND LEVELS
5	AIRCRAFT CONFIGURATION
6	GUARANTEE CONDITIONS
7	GUARANTEE COMPLIANCE
8	EXCLUSIVE GUARANTEES

P.A. No. 3712
AERO-B-BBA4-M11-1089B		SS12-0336
	BOEING PROPRIETARY

Attachment to Letter Agreement

No. FED-PA-03712-LA-1106584R4

CF6-80C2B6F Engines

Page 2

1	AIRCRAFT MODEL APPLICABILITY
	[*]
2	FLIGHT PERFORMANCE
2.1	Takeoff
	[*]
2.2	Landing
	[*]
2.3	Cruise Range
	[*]
2.4	Mission
2.4.1	Mission Payload
	[*]
2.4.2	Mission Payload
	[*]
2.4.3	Mission Payload
	[*]
2.4.4	Mission Payload
	[*]
2.4.5	Mission Block Fuel
	[*]
2.4.6	[*]

P.A. No. 3712
AERO-B-BBA4-M11-1089B		SS12-0336
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Attachment to Letter Agreement

No. FED-PA-03712-LA-1106584R4

CF6-80C2B6F Engines

Page 3

2.4.7	767-300F Weight Summary – S-544
	[*]
2.4.8	Standard and Operational Items Allowance
	[*]
3	MANUFACTURER’S EMPTY WEIGHT
	[*]
4	SOUND LEVELS
	[*]
5	AIRCRAFT CONFIGURATION
	[*]
6	GUARANTEE CONDITIONS
	[*]
7	GUARANTEE COMPLIANCE
	[*]
8	EXCLUSIVE GUARANTEES
	The only performance guarantees applicable to the Aircraft are those set forth in this Attachment.

P.A. No. 3712
AERO-B-BBA4-M11-1089B		SS12-0336
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

	The Boeing Company
	P.O. Box 3707
	Seattle, WA 98124-2207

FED-PA-03712-LA-1106614R1

Federal Express Corporation

3610 Hacks Cross Road

Memphis, TN 38125

Subject:	Special Matters for Purchase Right Aircraft
Reference:	Purchase Agreement No. PA-3712 (Purchase Agreement) between The Boeing Company (Boeing) and Federal Express Corporation (Customer) relating to Model 767-3S2F aircraft (Aircraft)

This letter agreement (Letter Agreement) cancels and supersedes Letter Agreement FED-PA-03712-LA-1106614 and amends and supplements the Purchase Agreement. All terms used but not defined in this Letter Agreement shall have the same meaning as in the Purchase Agreement. The credit memorandum provided for in this Letter Agreement will be applicable to exercised Purchase Right Aircraft only (Exercised Purchase Right Aircraft), as described in letter agreement FED-PA-03712-LA-1106158R2, Right to Purchase Additional Aircraft.

1. Credit Memoranda.

[*]

2. Escalation of Credit Memoranda.

Unless otherwise noted, the amounts of the Credit Memoranda stated in Paragraphs 1.1 through 1.5 are in [*] base year dollars and will be escalated to the scheduled month of the respective Exercised Purchase Right Aircraft delivery pursuant to the Airframe Escalation formula set forth in the Purchase Agreement applicable to the Exercised Purchase Right Aircraft. The Credit Memoranda may, at the election of Customer, be (i) [*].

3. [*]

4. Assignment.

Unless otherwise noted herein, the Credit Memoranda described in this Letter Agreement are provided as a financial accommodation to Customer and in consideration of Customer’s taking title to the Exercised Purchase Right Aircraft at time of delivery and becoming the operator of the Exercised Purchase Right Aircraft. This Letter Agreement cannot be assigned, in whole or in part, without the prior written consent of Boeing, which will not be unreasonably withheld.

FED-PA-03712-LA-1106614R1		SA-6
Special Matters for Purchase Right Aircraft		Page 1
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

5. Confidentiality

Customer understands that Boeing considers certain commercial and financial information contained in this Letter Agreement as confidential. Each of Customer and Boeing agree that it will treat this Letter Agreement and the information contained herein as confidential. Customer agrees to limit the disclosure of the contents of this Letter Agreement to employees of Customer with a need to know and who understand that they are not to disclose its content to any other person or entity without the prior written consent of Boeing. Notwithstanding the forgoing, Customer may disclose this Letter Agreement and the terms and conditions herein to its parent company, FedEx Corporation, to the Board of Directors of its parent corporation, FedEx Corporation, to its professional advisors under a duty of confidentiality with respect hereto, and as required by law.

Very truly yours,

THE BOEING COMPANY
By	/s/ Kirsten Jensen
Its	Attorney-In-Fact
ACCEPTED AND AGREED TO this
Date:	July 21, 2015
FEDERAL EXPRESS CORPORATION
By	/s/ Phillip C. Blum
Its	Vice President

FED-PA-03712-LA-1106614R1		SA-6
Special Matters for Purchase Right Aircraft		Page 2
	BOEING PROPRIETARY

	The Boeing Company
	P.O. Box 3707
	Seattle, WA 98124-2207

FED-PA-03712-LA-1208292R2

Federal Express Corporation

3610 Hacks Cross

Memphis, TN 38125

Subject:	Special Matters Concerning Escalation – Block B, Block C, Block E, Block F and Block G Aircraft
Reference:	Purchase Agreement No. 3712 (Purchase Agreement) between The Boeing Company (Boeing) and Federal Express Corporation (Customer) relating to Model 767-3S2F aircraft (Aircraft)

This letter agreement (Letter Agreement) cancels and supersedes Letter Agreement FED-PA-03712-LA-1208292R1 and amends and supplements the Purchase Agreement. All terms used but not defined in this Letter Agreement shall have the same meaning as in the Purchase Agreement. The terms provided in this Letter Agreement will be applicable to Block B, Block C, Block E, Block F and Block G Aircraft.

1. [*].

1.1 Boeing will [*] for the Airframe Price and Optional Features Prices of each Block B, Block C, Block E, Block F and Block G Aircraft for the period beginning [*] and continuing through [*], in accordance with the terms of this Letter Agreement.

1.2 Notwithstanding the [*], in the event Boeing reschedules a Block B, Block C, Block E, Block F or Block G Aircraft delivery outside the [*] pursuant to the delivery flexibility described in Letter Agreement Firm Aircraft Delivery Matters (FED-PA-03712-LA-1106154R2), Boeing agrees that the [*] will extend to apply to such rescheduled Block B, Block C, Block E, Block F or Block G Aircraft.

1.3 For the avoidance of doubt, in the event of an Excusable Delay or Non-Excusable Delay of a Block B, Block C, Block E, Block F or Block G Aircraft, Boeing and Customer acknowledge that the [*] to the contracted delivery month will be applied to such Block B, Block C, Block E, Block F or Block G Aircraft.

1.4 If Boeing and Customer mutually agree to reschedule a Block B, Block C, Block E, Block F or Block G Aircraft within the [*], the affected Block B, Block C, Block E, Block F or Block G Aircraft will continue to receive the [*] described herein, [*] to the rescheduled delivery month.

1.5 The [*] for the Airframe Price and Optional Features Price of each Block B, Block C, Block E, Block F and Block G Aircraft will be [*] during the [*] at a [*].

FED-PA-03712-LA-1208292R2		SA-6
Special Matters Concerning Escalation – Block B, Block C, Block E, Block F and Block G Aircraft		Page 1
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

2. Determining [*] for Block B, Block C, Block E, Block F and Block G Aircraft Delivering Within the [*].

2.1 For Block B, Block C, Block E, Block F and Block G Aircraft delivering within the [*], Boeing will, at time of Block B, Block C, Block E, Block F and Block G Aircraft delivery, calculate the [*] of the Airframe Price and Optional Features Price using (i) [*] in accordance with the provisions of [*] to the Purchase Agreement [*] and (ii) the [*]. The final Block B, Block C, Block E, Block F and Block G Aircraft Price will include the [*] Airframe Price and Optional Features Price utilizing the [*] or the [*], except as set forth below.

2.2 Notwithstanding paragraph 2.1 above, if [*] calculated pursuant to the [*], Customer will [*] on the Airframe Price and Optional Features Price [*] on the applicable Block B, Block C, Block E, Block F and Block G Aircraft; or

2.3 If [*] calculated pursuant to the [*], Customer will [*] on the Airframe Price and Optional Features Price [*] on the applicable Block B, Block C, Block E, Block F and Block G Aircraft. At least [*] of a Block B, Block C, Block E, Block F or Block G Aircraft, but not [*] of a Block B, Block C, Block E, Block F or Block G Aircraft, Boeing will provide Customer notification in the event the [*].

2.4 For an example of the determination of escalation factor applicable to the Airframe and Optional Features, refer to Attachment C to this Letter Agreement.

3. Effect on Advance Payments.

The amount and timing of advance payments Customer is required to pay to Boeing pursuant to the Purchase Agreement shall be unaffected by any terms set forth in this Letter Agreement.

4. Block B, Block C, Block E, Block F and Block G Aircraft Applicability.

Unless otherwise stated, the terms of this Letter Agreement shall only apply to the Block B, Block C, Block E, Block F and Block G Aircraft set forth in Tables 1-A1, 1-A2 and 1-B of the Purchase Agreement as of the execution date of this Letter Agreement.

FED-PA-03712-LA-1208292R2		SA-6
Special Matters Concerning Escalation – Block B, Block C, Block E, Block F and Block G Aircraft		Page 2
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

5. Applicability to Other Financial Consideration.

The escalation adjustment for any other sum identified in the Purchase Agreement as subject to escalation pursuant to Supplemental Exhibit AE1, and which pertains to Block B, Block C, Block E, Block F and Block G Aircraft set forth in Tables 1-A1, 1-A2 and 1-B as of the date of this Letter Agreement, shall be calculated using the escalation methodology established in this Letter Agreement notwithstanding any other provisions of the Purchase Agreement to the contrary.

6. Confidential Treatment.

Customer understands that Boeing considers certain commercial and financial information contained in this Letter Agreement as confidential. Each of Customer and Boeing agree that it will treat this Letter Agreement and the information contained herein as confidential. Customer agrees to limit the disclosure of the contents of this Letter Agreement to employees of Customer with a need to know and who understand that they are not to disclose its content to any other person or entity without the prior written consent of Boeing. Notwithstanding the foregoing, Customer may disclose this Letter Agreement and the terms and conditions herein to its parent company, FedEx Corporation, to the Board of Directors of its parent corporation, FedEx Corporation, to its professional advisors under a duty of confidentiality with respect thereto, and as required by law.

FED-PA-03712-LA-1208292R2		SA-6
Special Matters Concerning Escalation – Block B, Block C, Block E, Block F and Block G Aircraft		Page 3
	BOEING PROPRIETARY

Very truly yours,

THE BOEING COMPANY
By	/s/ Kirsten Jensen
Its	Attorney-In-Fact
ACCEPTED AND AGREED TO this
Date:	July 21, 2015
FEDERAL EXPRESS CORPORATION
By	/s/ Phillip C. Blum
Its	Vice President Aircraft Acquisition

Attachments A, B and C

FED-PA-03712-LA-1208292R2		SA-6
Special Matters Concerning Escalation – Block B, Block C, Block E, Block F and Block G Aircraft		Page 4
	BOEING PROPRIETARY

Attachment A to Letter Agreement FED-PA-03712-LA-1208292R2

[*]

FED-PA-03712-LA-1208292R2		SA-6
Attachment A
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Attachment B to Letter Agreement FED-PA-03712-LA-1208292R2

[*]

FED-PA-03712-LA-1208292R2		SA-6
Attachment B
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Attachment C to Letter Agreement FED-PA-03712-LA-1208292R2

ESCALATION EXAMPLE

[*]

FED-PA-03712-LA-1208292R2		SA-6
Attachment C
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

	The Boeing Company
	P.O. Box 3707
	Seattle, WA 98124-2207

FED-PA-03712-LA-1208296R1

Federal Express Corporation

3610 Hacks Cross Road

Memphis, TN 38125

Subject:	Special Matters for Block D Option Aircraft
Reference:	Purchase Agreement No. PA-3712 (Purchase Agreement) between The Boeing Company (Boeing) and Federal Express Corporation (Customer) relating to Model 767-3S2F aircraft (Aircraft)

This letter agreement (Letter Agreement) cancels and supersedes Letter Agreement FED-PA-03712-LA-1208296 and amends and supplements the Purchase Agreement. All terms used but not defined in this Letter Agreement shall have the same meaning as in the Purchase Agreement. The credit memorandum provided for in this Letter Agreement will be applicable to exercised Block D Option Aircraft only, which (i) are priced in [*] dollars and (ii) once exercised by the Customer will be added to Table 1-B1 of the Purchase Agreement (Exercised Block D Option Aircraft).

1. Credit Memoranda.

[*]

2. Escalation of Credit Memoranda.

Unless otherwise noted, the amounts of the Credit Memoranda stated in Paragraphs 1.1 through 1.5 are in [*] base year dollars and will be escalated to the same time period as the Airframe pursuant to the Airframe Escalation formula set forth in the Purchase Agreement applicable to the Exercised Block D Option Aircraft. The Credit Memoranda may, at the election of Customer, be [*].

3. [*]

4. Assignment.

Unless otherwise noted herein, the Credit Memoranda described in this Letter Agreement are provided as a financial accommodation to Customer and in consideration of Customer’s taking title to the Exercised Block D Option Aircraft at time of delivery and becoming the operator of the Aircraft. This Letter Agreement cannot be assigned, in whole or in part, without the prior written consent of Boeing, which will not be unreasonably withheld.

FED-PA-03712-LA-1208296R1		SA-6
Special Matters for Block D Option Aircraft		Page 1
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

5. Confidentiality

Customer understands that Boeing considers certain commercial and financial information contained in this Letter Agreement as confidential. Each of Customer and Boeing agree that it will treat this Letter Agreement and the information contained herein as confidential. Customer agrees to limit the disclosure of the contents of this Letter Agreement to employees of Customer with a need to know and who understand that they are not to disclose its content to any other person or entity without the prior written consent of Boeing. Notwithstanding the foregoing, Customer may disclose this Letter Agreement and the terms and conditions herein to its parent company, FedEx Corporation, to the Board of Directors of its parent corporation, FedEx Corporation, to its professional advisors under a duty of confidentiality with respect thereto, and as required by law.

FED-PA-03712-LA-1208296R1		SA-6
Special Matters for Block D Option Aircraft		Page 2
	BOEING PROPRIETARY

Very truly yours,

THE BOEING COMPANY
By	/s/ Kirsten Jensen
Its	Attorney-In-Fact
ACCEPTED AND AGREED TO this
Date:	July 21, 2015
FEDERAL EXPRESS CORPORATION
By	/s/ Phillip C. Blum
Its	Vice President Aircraft Acquisition

FED-PA-03712-LA-1208296R1		SA-6
Special Matters for Block D Option Aircraft		Page 3
	BOEING PROPRIETARY

	The Boeing Company
	P.O. Box 3707
	Seattle, WA 98124-2207

6-1162-SCR-146R1

Federal Express Corporation

3610 Hacks Cross

Memphis, TN 38125

Subject:	Special Provision – Block B and Block G Aircraft
Reference:	Purchase Agreement 3712 (the Purchase Agreement) between The Boeing Company (Boeing) and Federal Express Corporation (Customer) relating to Model 767-3S2F aircraft (the Aircraft)

This letter agreement (Letter Agreement) cancels and supersedes Letter Agreement 6-1162-SCR-146 and amends and supplements the Purchase Agreement. All terms used but not defined in this Letter Agreement have the same meaning as in the Purchase Agreement.

[*]

[Defined Terms]

“Block B Aircraft” means the four (4) Option Aircraft exercised, as identified in Table 1-B as Block B Aircraft, under Supplemental Agreement Number 1 to the Purchase Agreement and shall have the meaning as defined therein.

“Block G Aircraft” means the four (4) Aircraft identified in Table 1-A2 as Block G Aircraft pursuant to Supplemental Agreement Number 6 to the Purchase Agreement and shall have the meaning as defined therein.

[*]

“RLA” or “Railway Labor Act” means 45 USC Section 151 et seq.

“NLRA” or “National Labor Relations Act” means 29 USC Section 151 et seq.

6-1162-SCR-146R1		SA-6
Special Provision – Block B and Block G Aircraft		Page 1
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Very Truly Yours,

THE BOEING COMPANY
By	/s/ Kirsten Jensen
Its	Attorney-In-Fact
ACCEPTED AND AGREED TO this
Date:	July 21 , 2015
FEDERAL EXPRESS CORPORATION
By	Phillip C. Blum
Its	Vice President Aircraft Acquisition

6-1162-SCR-146R1		SA-6
Special Provision – Blocks B and Block G Aircraft		Page 2
	BOEING PROPRIETARY

	The Boeing Company
	P.O. Box 3707
	Seattle, WA 98124-2207

FED-PA-03712-LA-1306854R1

Federal Express Corporation

3610 Hacks Cross Road

Memphis, TN 38125

Subject:	Performance Guarantees, Demonstrated Compliance
Reference:	Purchase Agreement No. 3712 (Purchase Agreement) between The Boeing Company (Boeing) and Federal Express Corporation (Customer) relating to Model 767-300 Freighter firm aircraft (Aircraft)

This letter agreement (Letter Agreement) amends and supplements the Purchase Agreement. In addition, this Letter Agreement cancels and supersedes FED-PA-03712-LA-1306854 in its entirety. All terms used but not defined in this Letter Agreement shall have the same meaning as in the Purchase Agreement.

The Attachment to Letter Agreement No FED-PA-03712-LA-1106584R4 contains performance guarantees (Performance Guarantees).

1. Demonstration of Compliance.

1.1 Standard Method.

      Article 5.4 of the Aircraft General Terms Agreement Number AGTA-FED between Boeing and Customer dated November 7, 2006 (AGTA) provides that Boeing shall furnish to Customer as soon as practicable flight test data, obtained on an aircraft of the same type as the Aircraft, certified as correct by Boeing, to evidence compliance with the Performance Guarantees (Aircraft Report); and that any Performance Guarantee shall be deemed to be met if reasonable engineering interpretations and calculations based on such flight test data establish that the Aircraft would, if actually flown, comply with such guarantee. This method of demonstrating compliance with the Performance Guarantees is defined as the “Standard Method”. Except as provided in paragraph 1.2, the Standard Method will be used for establishing compliance with all Performance Guarantees.

1.2 Demonstration Method – Delivery Flight Verification.

      1.2.1 Notwithstanding the provisions of Article 5.4 of the AGTA, if Customer elects to purchase the option for the Demonstration Method pursuant to paragraph 2 herein for any Aircraft, then Customer shall have the right to request that the Demonstration Method (as defined in paragraph 1.2.4 herein) be used in lieu of the Standard Method. Each Aircraft for which Customer elects to purchase the Demonstration Method shall be a “Demonstration Aircraft”.

FED-PA-03712-LA-1306854R1		SA-6
Performance Guarantees, Demonstrated Compliance		Page 1
	BOEING PROPRIETARY

1.2.2 Customer will provide Boeing written notice to purchase the Demonstration Method no later than three (3) months prior to the first day of the month of scheduled delivery of any Demonstration Aircraft. Notwithstanding the foregoing, with respect to MSN 43544, scheduled for delivery in November 2013, Customer agrees to provide written notice to Boeing no later than October 24, 2013.

1.2.3 Customer will coordinate with Boeing to establish a flight plan for the delivery flight with sufficient flight time in stable air to gather the Calibrated Performance data described in Attachment A to this Letter Agreement.

1.2.4 For each Demonstration Aircraft, Boeing shall provide the [*] the respective delivery flight of a Demonstration Aircraft for the purpose of acquiring cruise fuel mileage performance data to be used in demonstrating compliance with the guarantees defined in paragraph 4 below (Particular Guarantees). The methodology described in this paragraph 1.2.4 shall be referred to as the “Demonstration Method”.

1.2.5 Establishing compliance with the Particular Guarantees shall be referred to as “Demonstration Calibrated Performance” and will be derived as follows:

1.2.5.1 During the delivery flight of each Demonstration Aircraft, cruise fuel mileage data will be obtained utilizing the calibrated production instruments of such Demonstration Aircraft. Such data shall be obtained during periods of stable cruise, in accordance with and subject to the applicable provisions of Part A of Attachment A to this Letter Agreement. The data will be analyzed in accordance with the applicable provisions of Part B of Attachment A hereto for establishing the Demonstration Calibrated Performance of the applicable Demonstration Aircraft.

1.2.6 As soon as practicable, but not later than [*] following completion of the Demonstration Method flight of each Demonstration Aircraft, Boeing shall present to Customer the final results of the Demonstration Calibrated Performance data together with supporting flight test data and analysis. To the extent the Demonstration Calibrated Performance as set forth in the Aircraft Report for such Demonstration Aircraft is equal to or better than the minimum value of the Particular Guarantees, compliance with such Guarantees shall be established for such Demonstration Aircraft.

FED-PA-03712-LA-1306854R1		SA-6
Performance Guarantees, Demonstrated Compliance		Page 2
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

2. Price for Demonstration Method.

2.1 The price for the Demonstration Method shall be [*]. Subject to the provisions of paragraphs 2.2 through 2.3, below, such amount [*]. For the avoidance of doubt, the price described in this article [*].

2.2 If Boeing fails to demonstrate compliance with the guaranteed minimum value of any of the Particular Guarantees on any Demonstration Aircraft, Boeing shall test subsequently delivered Aircraft using the Demonstration Method, as soon as possible, considering the time available between the realization of failure and the first subsequent airplane delivery, [*]. In addition, Boeing [*] of any of the Particular Guarantees; and

2.3 If, by means of such test, Boeing successfully demonstrates that any Aircraft is in compliance with the guaranteed minimum value of the Particular Guarantees by the Demonstration Method, then tests of each subsequently delivered Aircraft, if any, shall be at Customer’s option and at Customer’s expense. If Boeing fails to demonstrate compliance with the guaranteed minimum value of any of the Particular Guarantees by the Demonstration Method on subsequently delivered Aircraft, [*]. In addition, Boeing shall test subsequently delivered Aircraft [*].

3. Use of Demonstration Aircraft.

Customer agrees that Boeing may use the Aircraft to conduct the flight tests described in paragraph 1.2 hereof and that Customer will accept delivery of such Demonstration Aircraft [*].

4. Particular Guarantees.

4.1 The guarantees for which the Demonstration Method of compliance will be applicable are the Cruise Range Guarantee set forth in paragraph 2.3, the Mission Payload Guarantees set forth in paragraphs 2.4.1, 2.4.2, 2.4.3, and 2.4.4, and the Mission Block Fuel Guarantee set forth in paragraph 2.4.5 of the Performance Guarantees adjusted as set forth in paragraph 4.2 below.

4.2 When using the Demonstration Method for a Demonstration Aircraft, the guarantee values of the applicable Performance Guarantees shall be [*] to account for the use of calibrated cockpit instruments, in lieu of more extensive flight tests using flight test instrumentation systems and methods as described in the then current revision of Boeing Document D041A404, “The Determination of Cruise Fuel Mileage by Flight Testing Boeing Commercial Production Airplanes”. Such adjustments which reflect the effect of [*] on the guarantee parameter are applied to the guarantee values in the following manner:

a) Cruise Range – [*]

FED-PA-03712-LA-1306854R1		SA-6
Performance Guarantees, Demonstrated Compliance		Page 3
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

b) Mission Payload Guarantee 2.4.1 – [*]

c) Mission Payload Guarantee 2.4.2 – [*]

d) Mission Payload Guarantee 2.4.3 – [*]

e) Mission Payload Guarantee 2.4.4 – [*]

f) Mission Block Fuel Guarantee 2.4.5 – [*]

4.3 Such Cruise Range, Mission Payload, and Mission Block Fuel Guarantees so adjusted are hereinafter referred to as the “Particular Guarantees”.

5. Rights and Obligations in the Event of a Compliance Deviation.

5.1 Aircraft Delivery. The parties agree that a “Compliance Deviation” shall refer to instances in which a demonstrated value (regardless of the method by which the compliance is demonstrated) exceeds the guaranteed minimum value of a particular Performance Guarantee. In the event of a Compliance Deviation for any Aircraft at the time Boeing tenders for delivery, Boeing will provide the applicable remedies set forth in paragraph 5.2 and paragraph 6. Customer cannot refuse to accept delivery of such Aircraft because of such Compliance Deviation.

5.2 Post Delivery Improvement to Reduce or Eliminate the Compliance Deviation. In the event of a Compliance Deviation for any Aircraft, the following terms and conditions will apply:

5.2.1 To the extent Boeing reasonably determines it is economically and technically practicable, Boeing will use reasonable efforts to design, or cause to be designed by engine manufacturer, airplane drag improvement parts and/or engine fuel flow improvement parts (Improvement Parts) which, when installed in such Aircraft, would reduce or eliminate the Compliance Deviation.

5.2.2 If Boeing provides, or causes to be provided Improvement Parts for such Aircraft, then Customer and Boeing will mutually agree upon the details of an Improvement Parts program. The Improvement Parts [*]; except Improvement Parts provided by the engine manufacturer [*]. Boeing and/or engine manufacturer, as applicable, will provide reasonable support for such a Improvement Parts program [*].

5.2.3 If Customer elects to install Improvement Parts in such Aircraft, such installation will be within [*] after the delivery of such Improvement Parts to Customer as long as such installation can be accomplished during normal Aircraft line maintenance. Improvement Parts which cannot be installed during Aircraft line maintenance will be installed within a mutually agreed period of time. All Improvement Parts will be installed in accordance with Boeing and engine manufacturer instructions.

FED-PA-03712-LA-1306854R1		SA-6
Performance Guarantees, Demonstrated Compliance		Page 4
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

5.2.4 Boeing will provide and will cause engine manufacturer to provide [*]. Improvement Parts related to engines will apply also to spare engines [*]. Boeing will provide or will cause the engine manufacturer to provide Customer reasonable advance written notice of the estimated on-dock date at Customer’s maintenance base for any such Improvement Parts. Customer’s [*] must reference this Letter Agreement and be submitted to Boeing Warranty and Product Assurance Contracts using established warranty procedures set forth in Exhibit C of the AGTA and other terms identified in the Improvement Parts program contemplated in paragraph 5.2.2 herein.

6. Payments.

In the event that Boeing has not provided, or caused to be provided by the engine manufacturer, Improvement Parts which eliminate the Compliance Deviation, then Boeing will provide only the remedies described in this paragraph 6.

6.1 [*]

6.1.1 [*]

6.1.2 Customer will provide to Boeing, within [*].

6.1.3 Boeing will review the [*]. At its option, Boeing may request additional information from Customer to further substantiate the [*]. Such additional information will not be unreasonably requested by Boeing, nor unreasonably withheld by Customer.

6.2 [*]

6.3 [*]. The amount of performance improvement attributable to any Improvement Parts will be determined by Boeing analysis based on data certified to be correct by Boeing. The amount of such improvement will be deemed to be the amount of improvement as calculated using reasonable engineering interpretations based on the data furnished pursuant to Article 5.4 of the AGTA and the data furnished pursuant to this paragraph 6.3. If Customer elects not to install Improvement Parts in any applicable Aircraft as set forth in paragraph 5.2 above, [*].

7. Duplication of Benefits.

Boeing and Customer agree it is not the intent of the parties to provide benefits hereunder in addition to the benefits to be provided under the Purchase Agreement, and any direct commitment to Customer by the engine manufacturer.

FED-PA-03712-LA-1306854R1		SA-6
Performance Guarantees, Demonstrated Compliance		Page 5
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

8. Exclusive Remedy.

Customer agrees that the remedies contained in paragraphs 5.2 and 6 are Customer’s exclusive remedies for purposes of resolving all issues with respect to the Performance Guarantees of Customer’s Aircraft and are in lieu of all other rights, remedies, claims and causes of action Customer may have in connection therewith. Customer releases Boeing and its successors, affiliates and subsidiaries from all rights, remedies, claims and causes of action relating to or arising from such Performance Guarantees.

9. Assignment.

Notwithstanding any other provisions of the Purchase Agreement, the rights and obligations described in this Letter Agreement are provided to Customer in consideration of Customer’s becoming the operator of the Aircraft and cannot be assigned in whole or, in part.

10. Confidential Treatment.

Customer understands and agrees that the information contained herein represents confidential business information and has value precisely because it is not available generally or to other parties. Customer agrees to limit the disclosure of its contents to employees of Customer with a need to know the contents for purposes of helping Customer perform its obligations under the Purchase Agreement and who understand they are not to disclose its contents to any other person or entity without the prior written consent of Boeing.

If the foregoing correctly sets forth your understanding of our agreement with respect to the matters treated above, please indicate your acceptance and approval below.

FED-PA-03712-LA-1306854R1		SA-6
Performance Guarantees, Demonstrated Compliance		Page 6
	BOEING PROPRIETARY

Very truly yours,

THE BOEING COMPANY
By	/s/ Kirsten Jensen
Its	Attorney-In-Fact
ACCEPTED AND AGREED TO this
Date:	July 21, 2015
FEDERAL EXPRESS CORPORATION
By	/s/ Phillip C. Blum
Its	Vice President

FED-PA-03712-LA-1306854R1		SA-6
Performance Guarantees, Demonstrated Compliance		Page 7
	BOEING PROPRIETARY

Attachment A to Letter Agreement No FED-PA-03712-LA-1306854R1

Page 1

PART A

DATA SOURCES AND METHOD OF DATA ACQUISITION

Demonstration Method

1. Data Sources (Calibrated Performance)

Since special flight test instrumentation will not be used, data will be taken from flight deck instrument displays or available aircraft data systems and the appropriate calibration corrections will be applied to such data. The applicable instruments shall be calibrated in Boeing laboratories or equivalent prior to the test. The following tabulation summarizes the minimum data which will be taken.

Mach
Altitude
Air Temperature
Primary Power Setting Parameter	[*]
Ground Speed	[*]
Fuel Flow	[*]
Initial Gross Weight	[*]
Current Gross Weight

2. Data Correction

The corrections applied to the data will be in accordance with normal engineering practices as detailed in the then current revision of Boeing Document D041A404, “The Determination of Cruise Fuel Mileage by Flight Testing Boeing Commercial Production Airplanes.” These procedures correct the data for instrument calibrations, temperature deviation from a standard day, variation from unaccelerated level flight, difference between test and nominal gross weight divided by ambient static pressure ratio (W/d), altitude effect, Reynolds Number effect, wing aeroelastics, center of gravity, variation in electrical load, ECS operation, the differences between the measured fuel heating value and the Boeing standard value of 18,580 BTU/LB, and other corrections as appropriate.

FED-PA-03712-LA-1306854R1		SA-6
Performance Guarantees, Demonstrated Compliance		Page 8
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Attachment A to Letter Agreement No. FED-PA-03712-LA-1306854R1

Page 2

PART B

METHOD FOR DETERMINING CALIBRATED PERFORMANCE

Demonstration Method

1. For each Demonstration Aircraft, a series of points will be taken during the delivery flight to determine Cruise Specific Air Range with the target of getting [*] Mach numbers at or near the cruise Mach number specified in the Performance Guarantees and for [*] W/d values to be representative of conditions of the Performance Guarantees with a minimum impact on the scheduled flight plan. All test data will be adjusted to represent conditions of level, unaccelerated flight on a standard day and nominal conditions consistent with those used in the analysis of extensive flight test data obtained on an aircraft of the same type as the Aircraft as documented in the Cruise Performance Substantiation Document for the applicable Model 767-300 Freighter.

2. For the purpose of determining the Demonstration Calibrated Performance to be used in demonstrating compliance with the Particular Guarantees, the numerical average of deviations of the data for the Demonstration Aircraft will be calculated as compared to the database used for the “Standard Method”. The average deviation so determined will be used to determine an adjustment factor to be applied to the fuel mileage level documented in the Cruise Performance Substantiation Document for the applicable Model 767-300 Freighter. This factored fuel mileage level will be used to establish the Demonstration Calibrated Performance to be used in the calculation of compliance of the Demonstration Aircraft with the Particular Guarantees.

FED-PA-03712-LA-1306854R1		SA-6
Performance Guarantees, Demonstrated Compliance		Page 9
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Attachment B to Letter Agreement No FED-PA-03712-LA-1306854R1

Page 1

[*]

(a) [*] pursuant to paragraph 6.2 of the Letter Agreement to which this Attachment B is incorporated [*]:

[*]

NOTE: Any rounding of a number, as required under this Attachment with respect to escalation of the AAL, shall be accomplished as follows: If the first digit of the portion to be dropped from the number to be rounded is five or greater, the preceding digit shall be raised to the next higher number.

FED-PA-03712-LA-1306854R1		SA-6
Performance Guarantees, Demonstrated Compliance		Page 10
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

	The Boeing Company
	P.O. Box 3707
	Seattle, WA 98124-2207

6-1162-LKJ-0696R6

Federal Express Corporation

3131 Democrat Road

Memphis, TN 38118

Subject:	[ * ]
Reference:	Purchase Agreement No. PA-3712 (Purchase Agreement) between The Boeing Company (Boeing) and Federal Express Corporation (Customer) relating to Model 767-3S2F aircraft (Aircraft)

All terms used but not defined in this letter agreement (Letter Agreement) have the same meaning as in the Purchase Agreement. Other than as provided in this Letter Agreement all terms and conditions of the Purchase Agreement are hereby ratified and confirmed.

1. [ * ]

2. Customer understands that Boeing considers certain commercial and financial information contained in this offer as confidential. Customer agrees that it will treat this offer and the information contained herein as confidential and will not, without the prior written consent of Boeing, disclose this offer or any information contained herein to any other person or entity without the written consent of Boeing.

Please sign and return this offer on or before January 22, 2015.

6-1162-LKJ-0696R6 January 22, 2015
[ * ]		Page 1
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

AGREED AND ACCEPTED this
January 22, 2015
Date
THE BOEING COMPANY	FEDERAL EXPRESS CORPORATION
/s/ L. Kirsten Jensen	/s/ George Silverman
Signature	Signature
L. Kirsten Jensen	George Silverman
Printed name	Printed name
Attorney-in-Fact	Vice President Materiel Management
Title	Title

6-1162-LKJ-0696R6 January 22, 2015
[ * ]		Page 2
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Attachment to Letter Agreement 6-1162-LKJ-0696R6

[ * ]

Note: Boeing acknowledges that as of the date of this Letter Agreement Customer has executed a definitive agreement (Supplemental Agreement No. 5) for four (4) LDS Additional Aircraft.

[ * ]

BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

	The Boeing Company
	P.O. Box 3707
	Seattle, WA 98124-2207

6-1162-LKJ-0705

Federal Express Corporation

3610 Hacks Cross Road

Memphis, TN 38125

Subject:	Special Matters for Block E, Block F and Block G Aircraft in Table 1-A2
Reference:	Purchase Agreement No. PA-3712 (Purchase Agreement) between The Boeing Company (Boeing) and Federal Express Corporation (Customer) relating to Model 767-3S2F aircraft (Aircraft)

This letter agreement (Letter Agreement) amends and supplements the Purchase Agreement. All terms used but not defined in this Letter Agreement shall have the same meaning as in the Purchase Agreement. The credit memorandum provided for in this Letter Agreement will be applicable to Block E, Block F and Block G Aircraft, as identified in Table 1-A2 of the Purchase Agreement (Table 1-A2 Aircraft).

1. Credit Memoranda.

[*]

2. Escalation of Credit Memoranda.

Unless otherwise noted, the amounts of the Credit Memoranda stated in Paragraphs 1.1 through 1.6 are in [*] base year dollars and will be escalated to the same time period as the Airframe pursuant to the Airframe Escalation formula set forth in the Purchase Agreement applicable to the Table 1-A2 Aircraft. The Credit Memoranda may, at the election of Customer, be [*].

3. [*]

4. Assignment.

Unless otherwise noted herein, the Credit Memoranda described in this Letter Agreement are provided as a financial accommodation to Customer and in consideration of Customer’s taking title to the Table 1-A2 Aircraft at time of delivery and becoming the operator of the Table 1-A2 Aircraft. This Letter Agreement cannot be assigned, in whole or in part, without the prior written consent of Boeing, which will not be unreasonably withheld.

6-1162-LKJ-0705		SA-6
Special Matters for Block E, Block F and Block G Aircraft in Table 1-A2		Page 1
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

5. Confidentiality

Customer understands that Boeing considers certain commercial and financial information contained in this Letter Agreement as confidential. Each of Customer and Boeing agree that it will treat this Letter Agreement and the information contained herein as confidential. Customer agrees to limit the disclosure of the contents of this Letter Agreement to employees of Customer with a need to know and who understand that they are not to disclose its content to any other person or entity without the prior written consent of Boeing. Notwithstanding the foregoing, Customer may disclose this Letter Agreement and the terms and conditions herein to its parent company, FedEx Corporation, to the Board of Directors of its parent corporation, FedEx Corporation, to its professional advisors under a duty of confidentiality with respect thereto, and as required by law.

6-1162-LKJ-0705		SA-6
Special Matters for Block E, Block F and Block G Aircraft in Table 1-A2		Page 2
	BOEING PROPRIETARY

Very truly yours,

THE BOEING COMPANY
By	/s/ Kirsten Jensen
Its	Attorney-In-Fact
ACCEPTED AND AGREED TO this
Date:	July 21, 2015
FEDERAL EXPRESS CORPORATION
By	/s/ Phillip C. Blum
Its	Vice President Aircraft Acquisition

6-1162-LKJ-0705		SA-6
Special Matters for Block E, Block F and Block G Aircraft in Table 1-A2		Page 3
	BOEING PROPRIETARY

	The Boeing Company
	P.O. Box 3707
	Seattle, WA 98124-2207

6-1162-LKJ-0707

Federal Express Corporation

3610 Hacks Cross Road

Memphis, TN 38125

Subject:	Agreement Regarding [*]
Reference:	Purchase Agreement No. PA-3712 (Purchase Agreement) between The Boeing Company (Boeing) and Federal Express Corporation (Customer) relating to Model 767-3S2F aircraft

This letter agreement (Letter Agreement) amends and supplements the Purchase Agreement. All terms used but not defined in this Letter Agreement shall have the same meaning as in the Purchase Agreement.

1. Background.

[*]

2. [*]

3. [*]

4. Agreement Expiration.

Unless otherwise agreed by the parties in writing, this Letter Agreement shall remain in full force and effect until delivery or cancellation of all Aircraft provided for in and under the Purchase Agreement.

5. Assignment.

This Letter Agreement is for the benefit of the parties and their respective successors and assigns. No rights or duties of any party to this Letter Agreement may be assigned, in whole or in part.

6-1162-LKJ-0707		SA-6
Agreement Regarding [*]		Page 1
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

6. Confidentiality.

Customer understands that Boeing considers certain commercial and financial information contained in this Letter Agreement as confidential. Each of Customer and Boeing agree that it will treat this Letter Agreement and the information contained herein as confidential. Customer agrees to limit the disclosure of the contents of this Letter Agreement to employees of Customer with a need to know and who understand that they are not to disclose its content to any other person or entity without the prior written consent of Boeing. Notwithstanding the foregoing, Customer may disclose this Letter Agreement and the terms and conditions herein to its parent company, FedEx Corporation, to the Board of Directors of its parent corporation, FedEx Corporation, to its professional advisors under a duty of confidentiality with respect thereto, and as required by law.

6-1162-LKJ-0707		SA-6
Agreement Regarding [*]		Page 2
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Very truly yours,

THE BOEING COMPANY
By	/s/ Kirsten Jensen
Its	Attorney-In-Fact
ACCEPTED AND AGREED TO this
Date:	July 21, 2015
FEDERAL EXPRESS CORPORATION
By	/s/ Phillip C. Blum
Its	Vice President Aircraft Acquisition

6-1162-LKJ-0707		SA-6
Agreement Regarding [*]		Page 3
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

	The Boeing Company
	P.O. Box 3707
	Seattle, WA 98124-2207

6-1162-LKJ-0709

Federal Express Corporation

3610 Hacks Cross Road

Memphis, TN 38125

Subject:	[*] Special Matters
Reference:	a) Purchase Agreement No. PA-3712 (Purchase Agreement) between The Boeing Company (Boeing) and Federal Express Corporation (Customer) relating to Model 767-3S2F aircraft (Aircraft)
	b) Customer Services General Terms Agreement No. S2-2 (CSGTA) between Boeing and Customer, as amended and supplemented
	(c) Letter Agreement FED-SU-1106178R2, Federal Express Corporation [*]
	(d) Letter Agreement FED-S2-2-LA-1501881, [*] Special Matters – [*]

This letter agreement (Letter Agreement) amends and supplements the Purchase Agreement. All terms used but not defined in this Letter Agreement have the same meaning as in the Purchase Agreement.

[*]

1. [*]

2. [*]

3. Definitive Agreements.

The [*] described herein are or will be incorporated into definitive agreements between Customer and Boeing for the [*]. Such definitive agreements are or will include the terms contained herein and additional terms not included in this Letter Agreement.

6-1162-LKJ-0709		SA-6
[*] Special Matters		Page 1
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

4. Assignment.

Notwithstanding any other provisions of the Purchase Agreement, the rights and obligations described in this Letter Agreement are provided to Customer in consideration of Customer becoming the operator of the Aircraft and cannot be assigned in whole or, in part.

5. Confidential Treatment.

Customer understands that Boeing considers certain commercial and financial information contained in this Letter Agreement as confidential. Each of Customer and Boeing agree that it will treat this Letter Agreement and the information contained herein as confidential. Customer agrees to limit the disclosure of the contents of this Letter Agreement to employees of Customer with a need to know and who understand that they are not to disclose its content to any other person or entity without the prior written consent of Boeing. Notwithstanding the foregoing, Customer may disclose this Letter Agreement and the terms and conditions herein to its parent company, FedEx Corporation, to the Board of Directors of its parent corporation, FedEx Corporation, to its professional advisors under a duty of confidentiality with respect thereto, and as required by law.

6-1162-LKJ-0709		SA-6
[*] Special Matters		Page 2
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Very truly yours,

THE BOEING COMPANY
By	/s/ Kirsten Jensen
Its	Attorney-In-Fact
ACCEPTED AND AGREED TO this
Date:	July 21, 2015
FEDERAL EXPRESS CORPORATION
By	/s/ Phillip C. Blum
Its	Vice President

6-1162-LKJ-0709		SA-6
[*] Special Matters		Page 3
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

	The Boeing Company
	P.O. Box 3707
	Seattle, WA 98124-2207

FED-S2-2-LA-1501881

Federal Express Corporation

3610 Hacks Cross

Memphis, TN 38125

Subject:            [*] Special Matters – [*]

References:

a) Supplement Agreement (SA) No. 6 to Purchase Agreement No. 3712 (Purchase Agreement) between The Boeing Company (Boeing) and Federal Express Corporation (Customer) relating to Model 767-3S2F aircraft (Aircraft)

b) Customer Services General Terms Agreement No. S2-2 (CSGTA), as amended and supplemented, between Boeing and Customer

c) [*] between Boeing and Customer (collectively [*])

This letter agreement (Letter Agreement) will become effective upon signature by Boeing and Customer.

1. [*]

2. [*]

3. Assignment.

This credit memorandum is provided as a financial accommodation to Customer and cannot be assigned, in whole or in part, without the prior written consent of Boeing.

4. Confidential Treatment.

Customer understands that Boeing considers certain commercial and financial information contained in this Letter Agreement as confidential. Each of Customer and Boeing agree that it will treat this Letter Agreement and the information contained herein as confidential. Customer agrees to limit the disclosure of the contents of this Letter Agreement to employees of Customer with a need to know and who understand that they are not to disclose its content to any other person or entity without the prior written consent of Boeing. Notwithstanding the forgoing, Customer may disclose this Letter Agreement and the terms and conditions herein to its parent company, FedEx Corporation, to the Board of Directors of its parent corporation, FedEx Corporation, to its professional advisors under a duty of confidentiality with respect hereto, and as required by law.

FED-S2-2-LA-1501881		July 06, 2015
Special Matters-[*]		LA Page 1
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

If the foregoing correctly sets forth your understanding of our agreement with respect to the matters treated above, please indicate your acceptance and approval below.

Very truly yours,

/s/ Sarah Swezey
THE BOEING COMPANY
By	Sarah Swezey
Its	Attorney-In-Fact
ACCEPTED AND AGREED TO this
Date:	July 21
Federal Express Corporation
By	/s/ Phillip C. Blum
Its	Vice President

FED-S2-2-LA-1501881		July 06, 2015
Special Matters-[*]		LA Page 2
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

	The Boeing Company
	P.O. Box 3707
	Seattle, WA 98124-2207

6-1162-LKJ-0708

Federal Express Corporation

3131 Democrat Road

Memphis, TN 38118

Attention:	Mr. Kevin Burkhart
	Managing Director – Aircraft Acquisitions & Sales
Subject:	Special Considerations for [*] in 2015 and 2016
References:	(a) Purchase Agreement 3712 between The Boeing Company (Boeing) and Federal Express Corporation (Customer) dated December 14, 2011 relating to Model 767-3S2F Aircraft (767 Purchase Agreement)
	(b) Purchase Agreement 3157 between Boeing and Customer dated November 7, 2006 relating to 777-Freighter Aircraft (777 Purchase Agreement)

All terms used but not defined in this letter (Letter Agreement) shall have the same meaning as in the 767 Purchase Agreement.

1. Background.

1.1 Boeing and Customer intend to execute Supplemental Agreement No. 6 (SA-6) to the 767 Purchase Agreement to add thirty-five (35) Block E Aircraft, eleven (11) Block F Aircraft and four (4) Block G Aircraft to the Purchase Agreement, and additional Option Aircraft and Purchase Rights. Upon execution of SA-6, Customer will owe a payment to Boeing in the amount of [*].

1.2 [*]

2. Agreement.

Boeing will agree to Customer’s request for [*] as outlined in paragraph 1.2 above in exchange for Customer providing the following considerations:

2.1 [*]

2.2 [*]

2.3 [*]

2.4 [*]

2.5 [*]

6-1162-LKJ-0708
Special Considerations for [*] in 2015 and 2016		Page 1
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

3. Confidentiality.

Customer understands and agrees that the information contained herein represents confidential business information and has value precisely because it is not available generally or to other parties. Customer agrees to limit the disclosure of its contents to employees of Customer with a need to know the contents for purposes of helping Customer perform its obligations under the Purchase Agreement and who understand they are not to disclose its contents to any other person or entity without the prior written consent of Boeing.

Very truly yours,

THE BOEING COMPANY
By	/s/ Kirsten Jensen
Its	Attorney-In-Fact
ACCEPTED AND AGREED TO this
Date:	July 21, 2015
FEDERAL EXPRESS CORPORATION
By	/s/ Phillip C. Blum
Its	Vice President

6-1162-LKJ-0708		Page 2
Special Considerations for [*] in 2015 and 2016
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

	The Boeing Company
	P.O. Box 3707
	Seattle, WA 98124-2207

FED-SU-1106178R2

Federal Express Corporation

3610 Hacks Cross Road

Memphis, TN 38125

Subject:	Federal Express Corporation [*]
References:	1) Purchase Agreement No. PA-03712 (767 Purchase Agreement) between The Boeing Company (Boeing) and Federal Express Corporation (Customer) relating to Model 767-3S2F aircraft (Aircraft)
	2) FED-MO-1105406 R1 Proposal for 767-300 Boeing Converted Freighter (BCF) Program (Proposal for 25 767-300 BCF aircraft)
	3) FED-MO-1105421 R1 Proposal for 767-300 Boeing Converted Freighter Program (Proposal for 50 767-300 BCF aircraft)

This agreement No. FED-SU-1106178R2, dated July 15, 2015 supersedes and replaces in its entirety agreement No. FED-SU-1106178R1, dated June 29, 2012.

This Agreement incorporates the terms and conditions of Customer Services General Terms Agreement No. S2-2 (“CSGTA”) between Boeing and Customer by reference. All capitalized terms used but not defined in this Agreement have the same meaning as in the CSGTA. On the date Customer accepts this offer it will become an Order to the CSGTA.

1. [*]

2. Definitions

2.1 “Agreement” means this Order to the CSGTA.

2.2 [*]

2.3 [*]

2.4 [*]

2.5 “Option Aircraft” means all exercised Aircraft options as listed in Table 1-B of the 767 Purchase Agreement.

2.6 “Purchase Right Aircraft” means all Purchase Right Aircraft as listed in Table 1-C of the 767 Purchase Agreement.

2.7 [*]

2.8 [*]

FED-SU-1106178R2
[*]		Page 1
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

3. Term

3.1 Once this Agreement is executed, this Agreement will be in effect and [*].

3.2 [*]

3.3 [*]

4. [*]

4.1 [*]

4.2 [*]

4.3 [*]

4.4 [*]

• Other than to a subsidiary of Customer, Customer may not assign [*] under this Agreement, in whole or in part, without the prior written consent of Boeing.

[*]

5. Miscellaneous

5.1 Entire Agreement. This Agreement and the CSGTA contain the entire agreement between the parties and supersede all previous proposals, understandings, commitments or representations, oral or written, with respect to the subject matter hereof.

5.2 Confidential Treatment. Customer understands that Boeing considers certain commercial and financial information contained in this Agreement as confidential. Customer and Boeing agree that it will treat this Agreement and the information contained herein as confidential. Customer agrees to limit the disclosure of the contents of this Agreement to employees of Customer with a need to know and who understand that they are not to disclose its content to any other person or entity without the prior written consent of Boeing. Notwithstanding the forgoing, Customer may disclose this Agreement and the terms and conditions herein to its parent company, FedEx Corporation, to the Board of Directors of its parent company, FedEx Corporation, to its professional advisors under a duty of confidentiality with respect hereto, and as required by law.

AGREED AND ACCEPTED this
July 21, 2015
Date
THE BOEING COMPANY	FEDERAL EXPRESS CORPORATION
/s/ Sarah Swezey	/s/ Phillip C. Blum
Signature	Signature
Sarah Swezey	Phillip C. Blum
Printed name	Printed name
Attorney-in-Fact	Vice President
Title	Title

FED-SU-1106178R2
[*]		Page 2
	BOEING PROPRIETARY

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

Tri-Party Agreement Regarding [*]

THIS AGREEMENT, (Agreement) is entered into as of July 21, 2015, among Federal Express Corporation, (FedEx ), The Boeing Company (Boeing) and General Electric Company (GE) (hereinafter individually and collectively referred to as the Party or Parties, respectively).

RECITALS

A. WHEREAS, FedEx has purchased at least thirty-five (35) incremental Boeing Model 767F aircraft with the right to purchase additional option aircraft and purchase rights (the “Additional Order”).

[*]

    NOW THEREFORE, in consideration of the mutual promises and covenants herein contained the Parties hereto agree as follows:

1. [*]

2. [*]

3. This Agreement is for the benefit of the Parties and their respective successors and assigns. No rights or duties of any Party to this Agreement may be assigned, in whole or in part, without the prior written consent of the Parties.

4. This Agreement shall be interpreted under and governed by the laws of the state of Washington, U.S.A., except that Washington’s choice of law rules shall not be invoked for the purpose of applying the law of another jurisdiction.

5. No Party to this Agreement will make any news release or make any other information releases concerning this Agreement without the prior written consent of the other Parties. If consent is obtained, the Party disclosing information will, in each instance, obtain the prior written approval of the other Parties concerning the exact text and timing of any such disclosure.

6. [*]

* Blank spaces contained confidential information which has been filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed, as of the date first above, by their officers or agents thereunto duly authorized.

THE BOEING COMPANY
By	/s/ Kirsten Jensen
Title	Attorney-in-Fact
GENERAL ELECTRIC COMPANY
By	/s/ Kellan Grant
Title	Attorney-in-Fact
FEDERAL EXPRESS CORPORATION
By	/s/ Phillip C. Blum
Title	Vice President

EX-10.6

Exhibit 10.6

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

SAN FRANCISCO DIVISION

Dean Alexander, et al.,	Case No. 3:05-CV-38-EMC
Plaintiffs,
v.
FedEx Ground Package System, Inc.,
Defendant.

CLASS ACTION SETTLEMENT AGREEMENT

This Class Action Settlement Agreement (with the exhibits attached hereto, the “Agreement” or the “Settlement Agreement”) is made and entered into as of this      day of July, 2015 between Dean Alexander, Peter Allen, Albert Anaya, Suzanne Andrade, Jerrett Henderson, Ely Ines, Paul Infantino, Jorge Isla, Eric Jeppson, Gupertino Magana, Bernard Mendoza, Jesse Padilla, Joey Rodriguez, Dale Rose, Allan Ross, Agostino Scalercio, and Anthony Ybarra (collectively, the “Plaintiffs”), on behalf of themselves, the Certified Class, and the Certified Sub-Class, as defined below, and Defendant FedEx Ground Package System, Inc. (“FXG”), collectively, the “Parties,” to settle, fully and finally, all of the Released Claims (as defined below). This Agreement is made in consideration of the following facts:

A. Certain disputes and differences have arisen between the Parties concerning FXG’s classification of package delivery drivers as independent contractors instead of employees. Plaintiffs allege that based upon this employment classification, they and the members of the Certified Class and the Certified Sub-Class were, among other things, unlawfully deprived of the benefits of the California labor laws, were not paid all wages due, and bore expenses that should have been borne by FXG.

B. Dean Alexander, et al. v. FedEx Ground Package System, Inc., Case No. 3:05-CV-38-EMC, is currently pending in the United States District Court for the Northern District of California (the “Lawsuit”). The Lawsuit had previously been part of multi-district litigation proceedings in the United States District Court for the Northern District of Indiana (the “MDL”). In the MDL, Plaintiffs brought fifteen claims for relief against FXG in their Third Amended Complaint: (1) Interfering, Restraining or Denying the Exercise of Rights Under the Family Medical Leave Act in violation 29 U.S.C. § 2617(a)(1)(B); (2) Failure to Reimburse in Violation of Labor Code § 2802; (3) Failure to Pay Overtime Compensation in Violation of California Labor Code §§ 510 and 1194 et seq. and For Late Payment of Wages in Violation of California

1

Labor Code § 201 et seq.; (4) Failure to Provide Meal and Break Periods in Violation of California Labor Code §§ 510 and 226.7 and IWC 9; (5) Illegal Deductions From Wages in Violation Of California Labor Code § 221 and 223; (6) For Unlawful Coercion in Violation of California Labor Code § 450 et seq.; (7) Fraud; (8) Unfair Business Practices in Violation of California Business and Professions Code §§ 17200 et seq.; (9) Injunctive Relief under Cal. Bus. & Prof. Code § 17203; (10) Declaratory Relief under the Declaratory Judgment Act, 28 U.S.C. § 2201; California Code of Civil Procedure § 1060; (11) For an Accounting; (12) Civil Penalties under Labor Code § 2699; (13) Discrimination for the Exercise of Rights Under the Family Medical Leave Act in Violation of 29 U.S.C. § 2615(a)(2), (b); (14) Wrongful Termination in Violation of Public Policy; and (15) Injunctive and Declaratory Relief for Waiver of Claims in Violation of California Civil Code § 1668. FXG denies all of the allegations asserted in the Lawsuit and denies that it has committed any violation of law, misconduct, wrongdoing, or any other actionable conduct, and also denies that it has misclassified the Plaintiffs or the members of the Certified Class or Certified Sub-Class.

C. The MDL Court certified certain of Plaintiffs’ state-law claims (i.e., claims 2, 3, 5, 6, 8–10) and later ruled on the Parties’ motions for summary adjudication that the class members and sub-class members were independent contractors under California law. The MDL Court denied Plaintiffs’ motion for class certification as to their claims under the Family Medical Leave Act (i.e., claims 1 and 13). On or around May 27, 2011, the Judicial Panel on Multidistrict Litigation ordered that this case be remanded back to the Northern District of California for all future proceedings.

D. After further discovery on remand, the parties settled the FMLA-related claims.

E. Plaintiffs appealed this ruling to the United States Court of Appeals for the Ninth Circuit, and FXG conditionally cross-appealed (the “Appeal”). FXG’s cross-appeal argued that if the Ninth Circuit reversed the MDL Court’s grant of summary judgment to FXG, it should also reverse the MDL Court’s decision to certify the proposed classes.

F. On August 27, 2014, the Ninth Circuit issued an opinion in the Alexander action in which it reversed the MDL Court’s grant of partial summary judgment in favor of FXG and its denial of the Plaintiffs’ motion for partial summary judgment. The Ninth Circuit held instead that the Plaintiff drivers for FXG were employees under California law and remanded to the Northern District of California with instructions to enter summary judgment for Plaintiffs on their employment status.

G. The Parties, through counsel, have engaged in arm’s-length settlement negotiations. All Parties in the Lawsuit have agreed to settle the Lawsuit on behalf of the Certified Class, the Certified Sub-Class, and the individual Plaintiffs.

H. The Parties understand, acknowledge, and agree that this Agreement constitutes the compromise of all the disputed claims at issue in the Lawsuit and that it is the desire and intention of each of the Parties to effect a final and complete resolution of the Lawsuit and of the Released Claims of the Plaintiffs, the Certified Class, and the Certified Sub-Class, including all costs and attorneys’ fees incurred.

2

I. Plaintiffs and Class Counsel: (1) have examined and considered the benefits to be provided to Class Members and Sub-Class Members under the settlement provided for in this Agreement (the “Settlement”); (2) have considered the laws of California and the claims that have been and could be asserted relating to the classification of the members of the Certified Class and the Certified Sub-Class as independent contractors; and (3) believe the Settlement to be fair, reasonable, and adequate, and in the best interest of the Certified Class and the Certified Sub-Class, taking into account the benefits provided to the members of the Certified Class and the Certified Sub-Class through the terms of the Settlement, the decisions rendered in the Lawsuit, the risks of litigation, and the length of time that would be required to complete the litigation and any appeals.

J. The Parties further acknowledge that this Settlement is a compromise of disputed claims and that FXG is not in any way admitting liability by entering into this Settlement. FXG has at all times disputed, and continues to dispute, the allegations in the Lawsuit and denies any liability for any of the claims that have or could have been raised in the Lawsuit regarding the classification of the Plaintiffs and the members of the Certified Class and the Certified Sub-Class as independent contractors, but believes that the Settlement as provided in this Agreement will avoid the substantial expense and disruption of continued litigation.

K. The Parties believe that the Settlement is fair, reasonable and adequate. The Settlement was arrived at through arm’s-length negotiations, taking into account all relevant factors, and will materially benefit the members of the Certified Class and the Certified Sub-Class. The Parties recognize the uncertainty, risk, expense, and delay attendant to continuing the Lawsuit through trial and any appeal. Accordingly, the Parties desire to fully, finally, and forever settle, compromise, and discharge all disputes and claims arising from or relating to the Lawsuit.

Therefore, in consideration of the promises and agreements contained herein, the Parties agree and covenant as follows:

I. DEFINITIONS

As used in this Agreement, the following definitions (in addition to those set forth elsewhere herein) shall apply:

A. “Administration Expenses” means reasonable fees and expenses incurred by the Settlement Administrator for: (1) preparation and mailing of the Settlement Notice, Class and Settlement Notice, and Forms; (2) preparation and mailing of the Summary Notice; (3) preparation and mailing of the notice required by the Class Action Fairness Act, 28 U.S.C. § 1715; (4) receipt and evaluation of Exclusion Requests from Unnotified Class Members; (5) receipt and adjudication of Forms submitted by Class Members and Sub-Class Members for payment under this Settlement; (6) processing objections to this Settlement; (7) establishment and maintenance of the Class Settlement Fund, which is intended to be a “qualified settlement fund” under Internal Revenue Code § 468B and Treasury Regulation § 1.468B-1, as described in Section III.A below; (8) preparing and filing federal income tax returns for the Class Settlement Fund, as well as any other tax filings the Class Settlement Fund must make under federal, state, or local law; (9) paying and depositing the federal taxes owed by the Class Settlement Fund

3

under Treasury Regulation § 1.468B-2, as well as any state or local taxes owed by the Class Settlement Fund; (10) preparing, filing, and issuing all necessary tax reporting forms for the Class Settlement Fund, including IRS Forms 1099 and/or W-2 regarding the distribution of payments to Class Members, Class Counsel, and Plaintiffs; (11) providing FXG with copies of all tax reporting and filings made for the Class Settlement Fund, including copies of the checks and IRS Forms 1099 and W-2 issued to Class Members, Class Counsel, and Plaintiffs, and any other documentation to show that the tax reporting and filings were timely transmitted to the claimants and the applicable taxing authorities; (12) mailing of settlement payments to Eligible Class Members and Eligible Sub-Class Members who timely submit Valid Claims; (13) mailing of payment(s) for attorneys’ fees and costs to Class Counsel; (14) mailing of incentive awards to Plaintiffs; and (15) performance of any other actions specified in this Agreement or mutually requested by the Parties in writing.

B. “Certified Class,” or “Class,” means:

“All persons who: 1) entered into an [sic] FedEx Ground or FedEx Home Delivery Form Operating Agreement (now known as OP-149 and Form OP-149-RES); 2) drove a vehicle on a full-time basis (meaning exclusive of time off for commonly excused employment absences) from November 17, 2000 through October 15, 2007 to provide package pick-up and delivery services pursuant to the Operating Agreement; and 3) were dispatched out of a terminal in the state of California.”

For the purposes of this definition, and with regard to the terms of this Settlement Agreement, “persons” shall be defined to include both individuals and other business entities (whether partnerships, limited liability companies, sole proprietorships, corporations, or other business structures) who were signatories to operating agreements with FXG during the specified time period. It shall also include business entities (of whatever type) which entered into, or assumed an assignment of, an FXG Operating Agreement on or after October 15, 2007 where the authorized officer or owner of the business entity was a Class Member.

C. “Certified Sub-Class” or “Sub-Class” means:

All persons who: 1) entered into an [sic] FedEx Ground or FedEx Home Delivery Form Operating Agreement (now known as OP-149 and Form OP-149-RES); 2) drove a vehicle on a full-time basis (meaning exclusive of time off for commonly excused employment absences) from November 17, 2000 through October 15, 2007 to provide package pick-up and delivery services pursuant to the Operating Agreement; 3) were dispatched out of a terminal in the state of California; and 4) at any time during the class period operated a vehicle with gross vehicle weight rating of less than 10,001 pounds.

For the purposes of this definition, and with regard to the terms of this Settlement Agreement, “persons” shall be defined to include both individuals and other business entities (whether partnerships, limited liability companies, sole proprietorships, corporations, or other business structures) who were signatories to operating agreements with FXG during the specified time

4

period. It shall also include business entities (of whatever type) which entered into, or assumed an assignment of, an FXG Operating Agreement on or after October 15, 2007 where the authorized officer or owner of the business entity was a Sub-Class Member.

D. “Class Member” means any individual or business entity meeting the qualifications set forth in Section I.B. above, and/or any individual or business entity who was a signatory to an FXG Operating Agreement during the specified time period who the Parties otherwise agree to shall be considered a member of the Class. A preliminary list of Class and Subclass Members is attached hereto as Exhibit A1. Notwithstanding the attached list, nothing shall prevent the Parties, through their counsel, from mutually agreeing to subsequently modify the list of Class Members and Sub-Class Members to correct errors or omissions therein.

E. “Sub-Class Member” means any individual or business entity meeting the qualifications set forth in Section I.C. above, and/or any individual or business entity who was a signatory to an FXG Operating Agreement during the specified time period who the Parties otherwise agree to shall be considered a member of the Class. A preliminary list of Class and Subclass Members is attached hereto as Exhibit A2. Notwithstanding the attached list, nothing shall prevent the Parties, through their counsel, from mutually agreeing to subsequently modify the list of Class Members and Sub-Class Members to correct errors or omissions therein.

F. “Class Counsel” means Beth Ross, Esq., Aaron Kaufmann, Esq., David Pogrel, Esq., and Elizabeth Gropman, Esq. of Leonard Carder LLP.

G. “Court” means the judge presiding over the Lawsuit, currently United States District Judge Edward M. Chen.

H. “Effective Date” means the first business day after the following has occurred: (i) 45 days have lapsed from the entry by the Court of the Final Approval Order and the judgment thereon, and no notice of appeal of the judgment or any Order in the Lawsuit has been filed, the time provided for in Rule 4 of the Federal Rules of Appellate Procedure to take any such appeal has expired, and any right to take any such appeal from the judgment or from any such Order has been waived or otherwise lost; or (ii) if an appeal has been taken, each such appeal has been finally adjudicated and the Final Approval Order and judgment have been upheld in all respects by each such final adjudication, and either the time for initiation of the next step in the appellate process (e.g., a petition for writ of certiorari) has expired without any action by appellant(s) or the next step in the appellate process was invoked and has been concluded without any impact on the Final Approval Order or judgment.

I. “Eligible Class Member” means each Class Member and Sub-Class Member who timely and properly completes in full, signs under penalty of perjury, and submits the Forms, in accordance with the requirements of the Preliminary Approval Order.

J. “Fairness Hearing” means the final hearing, to be held after notice has been provided to the Class Members and Sub-Class Members in accordance with Section IV of this Agreement, to determine whether to grant final approval to the Settlement and enter the Final Approval Order.

5

K. “Final Approval Order” means the proposed Order Granting Final Approval to the Class Action Settlement Agreement and Entry of Final Judgment, to be entered by the Court with the terms and in the form of Exhibit B to this Agreement.

L. “Final Claims Date” means the date that the Preliminary Approval Order establishes as the date on or before which, to meet the timing requirement for a claim to qualify as a Valid Claim, all Forms must be placed in the United States Mail with first-class postage, addressed to the Settlement Administrator, and postmarked by the United States Postal Service.

M. “Forms” means, collectively, Form W-9 and the Claim Form to be included with the Settlement Notice.

N. “Form W-9” means the Internal Revenue Service’s Form W-9 (Request for Taxpayer Identification Number and Certification), which will be included with the Settlement Notice.

O. “Claim Form” means the proposed form attached hereto as Exhibit C, to be approved by the Court and submitted, in accordance with Section III of this Agreement, to the Settlement Administrator by Class Members and Sub-Class Members who wish to receive a payment pursuant to the Settlement.

P. “Settlement Notice” means, individually or collectively as the context may indicate, the proposed written notice attached hereto as Exhibit D, to be approved by the Court and mailed to Notified Class Members and Sub-Class Members in accordance with Section IV of this Agreement.

Q. “Preliminary Approval Order” means the proposed Order Granting Preliminary Approval to Class Action Settlement Agreement, to be entered by the Court with the terms and in the form of Exhibit F to this Agreement.

R. “Released Claims,” as to Plaintiffs and all Class Members and Sub-Class Members, means all claims, actions, causes of action, administrative claims, demands, debts, damages, penalties, costs, interest, attorneys’ fees, obligations, judgments, expenses, or liabilities, in law or in equity, whether now known or unknown, contingent or absolute, which: (i) are owned or held by Plaintiffs, Class Members, and Sub-Class Members and/or by their affiliated business entities (if any), or any of them, as against Releasees, or any of them; and (ii) arise under any statutory or common law claim which was asserted in Plaintiffs’ operative complaint or, whether or not asserted, are related to, or arise from, the employment classification of the Class or Subclass including but not limited to claims under California Labor Code §§ 201 et seq., 221, 223, 224, 226.7, 450 et seq., 510, 1194 et seq., 2699, 2802, 3200 et seq., IWC 9, California Business and Professions Code §§ 17200 et seq. and 17203; the Declaratory Judgment Act, 28 U.S.C. § 2201; California Code of Civil Procedure § 1060 and (iii) pertain to any time prior to the entry of the Preliminary Approval Order by the Court. This release includes any known or unknown claims for damages or injunctive relief. Specifically, the Class and Sub-class, in exchange for the valuable consideration offered herein, on their own behalf, and on behalf of any corporation, limited liability company, sole proprietorship, and any other business entity with which they have an ownership interest hereby expressly waives any

6

and all rights and benefits conferred upon them by the provisions of SECTION 1542 OF THE CALIFORNIA CIVIL CODE and expressly consents that this Agreement (including, without limitation, the Release set forth above) shall be given full force and effect according to each and all of its express terms and provisions, including those related to unknown and unsuspected claims, if any, as well as those relating to any other claims hereinabove specified. SECTION 1542 provides:

“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.”

S. “Releasees” means: (a) FXG, its consolidated subsidiaries, successors, predecessors, assigns, affiliates, parent companies, shareholders, officers, directors, agents, insurers, attorneys, and employees; and (b) FXG’s past, present, and future shareholders, officers, directors, agents, employees, attorneys, and insurers.

T. “Settlement Administrator” means the qualified firm approved by the Court to administer the Settlement and the Class Settlement Fund as described in Section III.A of this Agreement.

U. “Valid Claim” refers to Forms that: (i) are timely submitted by a Class Member or Sub-Class Member in accordance with the requirements of the Preliminary Approval Order, (ii) are signed under penalty of perjury by that Class Member or Sub-Class Member, and (iii) contain all of the information required for that Class Member or Sub-Class Member to be an Eligible Class Member or Eligible Sub-Class Member. Class Members and Sub-Class Members who timely submit Forms that are deficient in one or more respects will receive a deficiency notice from the Settlement Administrator and will have 30 days after the mailing of the deficiency notice in which to cure the deficiency. If a Class Member or Sub-Class Member fails to cure the deficiency within that time, the Settlement Administrator shall deem the deficient claim to be an invalid claim.

V. “Class Settlement Fund” means the fund that will be established and maintained to resolve the claims at issue, as described in Section III.A. below, and which is intended to be a qualified settlement fund within the meaning of Internal Revenue Code § 468B and Treasury Regulation § 1.468B-1.

W. “Notified Class Member” means a Class Member who, prior to execution of this Settlement Agreement, received notice of his/her/its membership in the Certified Class and did not opt out in the manner and time prescribed by the MDL Court.

X. “Unnotified Class Member” means a Class Member who is not a Notified Class Member.

Y. “Class and Settlement Notice” means, individually or collectively as the context may indicate, the proposed written notice attached hereto as Exhibit E, to be approved by the Court and mailed to Unnotified Class Members and Sub-Class Members in accordance with Section IV of this Agreement.

Z. “Exclusion Request” means a request to opt out of the Certified Class by any Unnotified Class Member.

7

II. REQUIRED EVENTS

The events set forth in this Section II, in addition to the occurrence of the “Effective Date” as described in Section I., are conditions precedent to this Agreement becoming effective.

As soon as practicable after the execution of this Agreement by all Plaintiffs and FXG, the Plaintiffs shall file this Agreement with the Court and move for entry of the Preliminary Approval Order, substantially in the form of Exhibit F hereto, which by its terms shall accomplish all of the following:

1. Preliminarily approve this Settlement as fair, reasonable, and adequate to the Class Members and Sub-Class Members;

2. Designate Rust Consulting as the Settlement Administrator, and approve it to perform the following functions in accordance with the terms of this Agreement, the Preliminary Approval Order, and the Final Approval Order:

a. Provide for the Settlement Notice (with the Fairness Hearing date) and the Forms, in a form substantially the same as the documents attached hereto as Exhibit C and Exhibit D, to be sent by mail to all Notified Class Members and Sub-Class Members that can be identified through a reasonable effort;

b. Provide for the Class and Settlement Notice (with the Fairness Hearing date) and the Forms, in a form substantially the same as the document attached hereto as Exhibit C and Exhibit E, to be sent by mail to all Unnotified Class Members and Sub-Class Members that can be identified through a reasonable effort;

c. Receive and evaluate any Exclusion Requests from Unnotified Class Members

d. Provide for the notice required by the Class Action Fairness Act (“CAFA”), 28 U.S.C. § 1715, substantially in the form attached hereto as Exhibit G, to be mailed in accordance with the provisions of CAFA to the appropriate federal and state officials;

e. Receive, evaluate, and either approve as meeting the requirements of Section III.B of this Agreement or disapprove as failing to meet those requirements, the Forms submitted by Class Members and Sub-Class Members seeking to receive a payment under this Settlement, all in accordance with Sections I and III of this Agreement;

8

f. Provide to FXG and Class Counsel, 14 days after the first mailing of the Settlement Notice and Forms and then updated every 14 days thereafter, (i) a list of the names and addresses of all Class Members and Sub-Class Members who have submitted Forms and whose Forms the Settlement Administrator has determined constitute Valid Claims; (ii) a separate list of the names and addresses of all Class Members and Sub-Class Members who have submitted Forms and whose Forms the Settlement Administrator has determined do not constitute Valid Claims; (iii) a separate list of the names and addresses of all Class Members and Sub-Class Members who have submitted documents indicating that they wish to object to the Settlement; and (iv) a list of the names and addresses of all Unnotified Class Members who have submitted Exclusion Requests along with copies of the Exclusion Requests.

g. Send, by first-class United States Mail, to each Class Member and Sub-Class Member who has timely submitted Forms that the Settlement Administrator has determined to be deficient in some respect, a notice of deficiency;

h. Process objections to the Settlement in accordance with Section VI of this Agreement;

i. Mail settlement payments to Class Members and Sub-Class Members with Valid Claims, as ordered by the Court in the Final Approval Order, in accordance with Section III of this Agreement;

j. Mail payment(s) for attorneys’ fees and costs to Class Counsel, as ordered by the Court in the Final Approval Order, in accordance with Section VII of this Agreement;

k. Mail incentive awards to Plaintiffs as ordered by the Court in the Final Approval Order, in accordance with Section VII of this Agreement;

l. Establish, designate and maintain the Class Settlement Fund as a “qualified settlement fund” under Internal Revenue Code § 468B and Treasury Regulation § 1.468B-1 for the purpose of resolving the contested claims of Eligible Class Members and Eligible Sub-Class Members;

m. Maintain the assets of the Class Settlement Fund in a non-interest bearing escrow account segregated from the assets of FXG and any person related to FXG;

n. Obtain an employer identification number (EIN) for the Class Settlement Fund pursuant to Treasury Regulation § 1.468B-2(k)(4);

o. Prepare and file federal income tax returns for the Class Settlement Fund, as well as any other tax filings the Class Settlement Fund must make under federal, state, or local law;

9

p. Cooperate with FXG to jointly file a relation-back election under Treasury Regulation § 1.468B-1(j)(2), if necessary, to treat the Class Settlement Fund as coming into existence as of the earliest possible date;

q. Pay and deposit the federal taxes owed by the Class Settlement Fund under Treasury Regulation § 1.468B-2, as well as any state or local taxes owed by the Class Settlement Fund;

r. Prepare, file, and issue all necessary tax reporting forms for the Class Settlement Fund, including IRS Forms 1099 regarding the distribution of payments to Class Members, Class Counsel, and Plaintiffs;

s. Provide FXG with copies of all tax reporting and filings made for the Class Settlement Fund, including copies of the checks and IRS Forms 1099 issued to Class Members, Class Counsel, and Plaintiffs, and any other documentation to show that the tax reporting and filings were timely transmitted to the claimants and the applicable taxing authorities;

t. Pay any additional tax liabilities (including penalties and interest) that arise from the establishment and administration of the Class Settlement Fund solely from the assets of the Class Settlement Fund without any recourse against FXG for additional monies;

u. Within 30 days after the payment of all Valid Claims, provide to FXG and Class Counsel a statement of the total number of claims submitted, the total number of claims adjudicated to be Valid Claims, and the total dollar amount paid to each Class Member and Sub-Class Member (the “Final Accounting”);

v. Liquidate any remaining assets of the Class Settlement Fund after all payments to Class Members, Class Counsel, and Plaintiffs have been made and all tax obligations have been satisfied, and distribute such assets as directed by the Court; and

w. Petition the Court for termination of the Class Settlement Fund once all of the duties listed above in subsections (a) to (u) have been completed.

3. Approve reasonable compensation and costs to the Settlement Administrator in accordance with the terms of Exhibit H hereto.

4. Approve the “§ 1.468B-3 Statement” that FXG will provide to the Settlement Administrator by February 15 of the year following the calendar year in which FXG transfers the Settlement Payment to the Class Settlement Fund.

5. Approve the form, contents, and methods of notice to be given to the Class Members and Sub-Class Members as set forth in Section IV of this Agreement, and direct the Settlement Administrator to provide such notices.

10

6. Establish procedures and deadlines for Class Members and Sub-Class Members to object to the Settlement and to submit Forms to the Settlement Administrator, all consistent with Sections III and VI of this Agreement.

7. Schedule deadlines for the filing of (a) objections to the Settlement, and (b) papers in support of final approval of the Settlement; and

8. Schedule the Fairness Hearing for a date which is no sooner than 100 days after the Court enters an order preliminary approving the proposed class settlement described in this Settlement Agreement.

At the Fairness Hearing, the Plaintiffs will request the Court to enter the Final Approval Order, substantially in the form of Exhibit B hereto, which: (1) grants final approval of the Settlement and this Agreement as fair, reasonable, and adequate to the Class Members and Sub-Class Members; (2) provides for the release of all Released Claims and enjoins any and all Class Members and Sub-Class Members from asserting, filing, maintaining, or prosecuting any of the Released Claims in the future; (3) orders the dismissal with prejudice of all Released Claims, and incorporates the releases and covenant not to sue stated in this Agreement, with each of the Parties to bear its, his, or her own costs and attorneys’ fees (except as provided in Section VII below; (4) authorizes the payment the Settlement Administrator to pay Valid Claims, in accordance with the terms of this Agreement; (5) authorizes the payment of incentive awards to each of the Plaintiffs as detailed in Section VII below; and (6) retains the Court’s jurisdiction over the administration of the Settlement and enforcement of this Agreement.

Plaintiffs, Class Counsel, and FXG will cooperate and take all reasonable actions to accomplish the above. If the Court fails to enter the Preliminary Approval Order or the Final Approval Order substantially in the form submitted by the Parties, Plaintiffs, Class Counsel, and FXG will use all reasonable efforts that are consistent with this Agreement to cure any defect identified by the Court. If, despite such efforts, the Court does not enter the Preliminary Approval Order and Final Approval Order, the Parties will return to their prior positions in the Lawsuit in accordance with Section XI.A of this Agreement.

The Settlement Administrator will sign a written acknowledgment and acceptance of its duties in the form of Exhibit I hereto. FXG shall have a right to petition the Court for a remedy if FXG reasonably believes that the Settlement Administrator is failing to perform its duties.

III. PAYMENT TO CLASS SETTLEMENT FUND, AND PROCEDURES FOR PROVIDING PAYMENTS TO CLASS MEMBERS AND SUB-CLASS MEMBERS WITH VALID CLAIMS

A. Payment to Class Settlement Fund

No later than five business days after the Effective Date, and in accordance with the other terms of this Agreement and its exhibits, FXG shall transfer the “Settlement Payment,” defined as the amount of two hundred and twenty-eight million dollars ($228,000,000) (inclusive of $1,600,000.00 in PAGA penalties, seventy-five percent (75%) of which the Settlement Administrator shall cause to be paid to the State of California ($1,200,000.00); inclusive of a maximum of sixteen million dollars ($16,000,000.00) in payments for unpaid wages, fifty

11

percent (50%) of which is allocated to non-taxable prejudgment interest; and inclusive of One million dollars ($1,000,000.00) to be paid to Plaintiffs in satisfaction of their individual meal and rest break claims plus an additional amount sufficient to pay the employer’s share of employment and payroll taxes due, if any, on any wage amounts paid, to the Class Settlement Fund to resolve the contested claims of Eligible Class Members and Eligible Sub-Class Members). The Parties intend the Class Settlement Fund to be a “qualified settlement fund” under Internal Revenue Code § 468B and Treasury Regulation § 1.468B-1. Accordingly, FXG shall retain no rights or reversionary interests in the Settlement Payment once transferred to the Class Settlement Fund. Furthermore, FXG’s obligation to make the Settlement Payment is contingent on (1) the Court’s entry of the Preliminary Approval Order appointing the Settlement Administrator and approving the Settlement Administrator to establish and maintain the Class Settlement Fund; and (2) the Court’s entry of the Final Approval Order releasing and dismissing with prejudice all of the Released Claims. Under no circumstances shall FXG be required to pay more under this Settlement than the amount of the Settlement Payment. The Class Settlement Fund is a common fund that includes Class Counsel’s fees and costs as described more fully in Section VII.A of this Agreement, the incentive award payments to Plaintiffs as described more fully in Section VII.B of this Agreement, and the Administrative Expenses, Costs of Notice, and Costs of Claims Administration described in Section V of this Agreement.

B. Payment Calculation for Class Members and Sub-Class Members

If an Eligible Class Member or Sub-Class Member timely submits a Valid Claim (“the Claimant,” for purposes of this Section III), the Claimant shall receive a payment based on a calculation made by Class Counsel (the “Payment Calculation(s)”). Class Counsel shall make and submit to the Settlement Administrator and FXG their Payment Calculation(s) for each Claimant no later than fifteen (15) business days after entry by the Court of the Final Approval Order. The Payment Calculation(s) shall take into account the dates and duration of contracting, the hours and days of work, and vehicles used and miles driven by those vehicles, the division of FedEx Ground for which Class members drove, as well as any other factors Class Counsel may, in their judgment, deem relevant. Class Counsel assumes and accept all responsibility and liability associated with their Payment Calculation(s).

If any Class Member or Sub-Class Member does not timely submit a Valid Claim, or if an Unnotified Class Member makes an Exclusion Request, then the amount of the Class Settlement Fund allocable to that Class Member or Sub-Class Member shall be redistributed, on a pro rata basis, to Class Members and Sub-Class Members who have submitted Valid Claims. Although Class Members and Sub-Class Members who do not timely submit a Valid Claim are not entitled to receive a settlement payment under this Agreement, they shall still be bound by the other provisions of this Agreement, including without limitation the release of claims in Section I.R.

C. Procedures for Evaluation, Approval, and Payment of Valid Claims

The Settlement Administrator shall be solely responsible for the following functions in accordance with the terms of this Agreement, the Preliminary Approval Order, and the Final Approval Order:

1. Mailing, by first-class United States Mail, the Settlement Notice (with the Fairness Hearing date and deadlines established by the Court in the Preliminary Approval Order) and the Forms to all Class Members and Sub-Class Members that can be identified through a reasonable effort.

12

2. Mailing, by first-class United States Mail, the Class and Settlement Notice (with the Fairness Hearing date and deadlines established by the Court in the Preliminary Approval Order) and the Forms to all Unnotified Class Members and Sub-Class Members that can be identified through a reasonable effort.

3. Notifying the appropriate federal and state officials under CAFA.

4. Receiving, evaluating, and approving or disapproving the Forms submitted by Class Members and Sub-Class Members seeking to receive a payment pursuant to this Settlement.

5. Receiving and evaluating all Exclusion Requests submitted by Unnotified Class Members and Sub-Class Members.

6. Providing to FXG and Class Counsel: (i) a list of the names and addresses of all Class Members and Sub-Class Members who have submitted Forms and whose Forms the Settlement Administrator has determined to constitute Valid Claims; (ii) a separate list of the names and addresses of all Class Members and Sub-Class Members who submitted Forms and whose Forms the Settlement Administrator has determined do not constitute Valid Claims; (iii) a separate list of the names and addresses of all Class Members and Sub-Class Members who have submitted documents indicating that they wish to object to the Settlement; and (iv) a list of the names and addresses of all Unnotified Class Members who have submitted Exclusion Requests along with copies of the Exclusion Requests.

7. Mailing, by first-class United States Mail, a notice of deficiency to each Class Member and Sub-Class Member that timely submitted Forms and whose Forms the Settlement Administrator has determined to be deficient in some respect.

8. Processing objections to the Settlement;

9. Mailing, by first-class United States Mail, settlement payments to Class Members and Sub-Class Members with Valid Claims in accordance with the Payment Calculation for each such Class Member and Sub-Class Member provided to the Settlement Administrator by Class Counsel.

10. Mailing, by first-class United States Mail, payment(s) for attorney’s fees and costs to Class Counsel.

11. Mailing, by first-class United States Mail, incentive awards to Plaintiffs.

12. Establishing and maintaining the Class Settlement Fund as a “qualified settlement fund” under Internal Revenue Code § 468B and Treasury Regulation § 1.468B-1, for the purpose of resolving the contested claims of Eligible Class Members and Eligible Sub-Class Members.

13

13. Maintaining the assets of the Class Settlement Fund in a non-interest bearing escrow account segregated from the assets of FXG and any person related to FXG.

14. Obtaining an employer identification number (EIN) for the Class Settlement Fund.

15. Preparing and filing federal income tax returns for the Class Settlement Fund, as well as any other tax filings the Class Settlement Fund must make under federal, state, or local law.

16. Cooperating with FXG to jointly file a relation-back election, if necessary.

17. Paying and depositing the federal taxes owed by the Class Settlement Fund under Treasury Regulation § 1.468B-2, as well as any state or local taxes owed by the Class Settlement Fund.

18. Preparing, filing, and issuing all necessary tax reporting forms for the Class Settlement Fund, including IRS Forms 1099 and W-2 regarding the distribution of payments to Class Members, Class Counsel, and Plaintiffs.

19. Providing FXG with copies of all tax reporting and filings made for the Class Settlement Fund, including copies of the checks and IRS Forms 1099 issued to Class Members, Class Counsel, and Plaintiffs, and any other documentation to show that the tax reporting and filings were timely transmitted to the claimants and the applicable taxing authorities.

20. Paying any additional tax liabilities (including penalties and interest) that arise from the establishment and administration of the Class Settlement Fund. Any such tax payment shall be made solely from the assets of the Class Settlement Fund without any recourse against FXG for additional monies.

21. Providing the Final Accounting to FXG and Class Counsel.

22. Liquidating any remaining assets of the Class Settlement Fund after all payments to Class Members, Class Counsel, and Plaintiffs have been made and all tax obligations have been satisfied, and distributing such assets as directed by the Court.

23. Petitioning the Court for termination of the Class Settlement Fund once all of the duties listed above in subsections (1) to (22) have been completed.

14

D. Payment to Class Members and Sub-Class Members

Upon occurrence of the Effective Date, the Settlement Administrator shall, as soon as thereafter reasonably practicable, but within no more than 10 additional business days: mail, by first-class United States Mail, to Claimants (as defined in Section III.A) checks in the amounts determined by Class Counsel pursuant to Section III.A and drawn on the account of the Class Settlement Fund. To the extent checks are not cashed within one hundred and eighty (180) days, these funds shall be deposited with a Cy Pres recipient mutually agreed to by the parties.

E. Settlement Administrator’s Acceptance of Duties and Compensation

The Settlement Administrator will sign a written acknowledgment and acceptance of its duties in the form of Exhibit I hereto. The Settlement Administrator with receive reasonable compensation and costs in accordance with the terms of Exhibit H hereto. If FXG reasonably believes that the Settlement Administrator is failing to perform its duties, FXG shall have the right to petition the Court for a remedy.

IV. SETTLEMENT NOTICE

The parties agree that the Settlement Notice, Class and Settlement Notice, and Forms provide information sufficient to inform the Class Members and Sub-Class Members of the material terms of this Settlement, the appropriate means for obtaining additional information regarding this Agreement and the Lawsuit, and the appropriate means for and information about submitting a claim for payment pursuant to the Settlement. The parties also agree that the Class and Settlement Notice provides information sufficient to inform the Unnotified Class Members and Sub-Class Members of the nature of the subject matter of the Lawsuit, appropriate means for obtaining additional information regarding the Lawsuit, and meets all of the requirements of Rule 23(c) of the Federal Rules of Civil Procedure. To facilitate the efficient administration of this Settlement, and to facilitate payment of Valid Claims under the Settlement, the Settlement Administrator will be directed to provide all Notified Class Members and Sub-Class Members with copies of the Settlement Notice and Forms, and to provide all Unnotified Class Members and Sub-Class Members with copies of the Class and Settlement Notice and Forms, as well as contact information for Class Counsel in the event they have questions. Plaintiffs will request the Court to approve the Settlement Notice, Class and Settlement Notice, and Forms in the Preliminary Approval Order.

As soon as practicable, but no later than 15 days after the Court’s entry of the Preliminary Approval Order, the Settlement Administrator shall send or cause to be sent, by first-class United States Mail, a copy of the Settlement Notice and Forms to every Notified Class Member and Sub-Class Member who can be identified through reasonable effort, and a copy of the Class and Settlement Notice and Forms to every Unnotified Class Member and Sub-Class Member who can be identified through reasonable effort. Before the mailing of such Settlement Notices, Class and Settlement Notices, and Forms, the Settlement Administrator will obtain or cause to be obtained address updates utilizing a national change of address database.

The parties agree that the dissemination of the Settlement Notice, Class and Settlement Notice, and Forms by mail in the manner specified in this Section IV satisfies the notice

15

requirements of due process and Rule 23 of the Federal Rules of Civil Procedure. Plaintiffs will request the Court to approve, in the Preliminary Approval Order, the direct mailing of the Settlement Notice, Class and Settlement Notice, and Forms as set forth in this Section IV.

V. COSTS OF NOTICE AND CLAIMS ADMINISTRATION

All costs (i) of preparing and disseminating the Settlement Notices, Class and Settlement Notices, and Forms provided for in Section IV above, and (ii) all other Administration Expenses, including payments made for the services of the Settlement Administrator shall be payable from the Class Settlement Fund. Unless otherwise specifically agreed in writing, FXG shall not be responsible for any cost that may be incurred by, on behalf of, or at the direction of Plaintiffs or Class Counsel in (a) responding to inquiries about the Agreement, the Settlement, or the Lawsuit, (b) defending the Agreement or the Settlement against any challenge to them, (c) defending against any challenge to any order or judgment entered pursuant to the Agreement, or (d) for any other reason except to the extent provided by law.

VI. PROCEDURES FOR SETTLEMENT APPROVAL

A. Preliminary Approval

Plaintiffs shall, within 14 days of the execution of this Agreement by all Parties, move the Court to enter the Preliminary Approval Order. The proposed deadlines to be established in the Preliminary Approval Order are as follows:

1. 15 days after entry of the Preliminary Approval Order: Date on or before which Settlement Notices, Class and Settlement Notices, and Forms will be mailed to Class Members and Sub-Class Members and the Summary Notice will be published.

2. 14 days before the Fairness Hearing: Date on or before which Exclusion Requests by Unnotified Class Members and Sub-Class Members must be either postmarked by the United States Postal Service or actually received by the Settlement Administrator.

3. 14 days before the Fairness Hearing: Date on or before which objections to the Settlement, the Agreement, or the amount of fees and expenses that Class Counsel has requested, together with all supporting memoranda and other material, must be filed with the Court and served on Class Counsel and FXG.

4. 14 days before the Fairness Hearing: Date on or before which any person or attorney seeking to appear at the Fairness Hearing, for the purpose of objecting to the Settlement, the Agreement, or the amount of fees and expenses that Class Counsel has requested, must file with the Court and serve on Class Counsel and FXG an entry of appearance in the Lawsuit and notice of intention to appear at the Fairness Hearing.

5. 60 days after mailing of the Settlement Notice and Claim Forms: Final Claims Date on or before which, to meet the timing requirement for a claim to qualify as a Valid Claim, all Forms must be postmarked by the United States Postal Service after being placed in the United States Mail with first-class postage, addressed to the Settlement Administrator.

6. The parties will coordinate with the Court to set a date for the Fairness Hearing that is no sooner than 100 days after this Agreement is filed with the Court.

16

B. Final Approval

At the Fairness Hearing, Plaintiffs shall request the Court to enter the Final Approval Order, substantially in the form of Exhibit B, which: (1) grants final approval to the Settlement and this Agreement as fair, reasonable, and adequate to the Certified Class and the Certified Sub-Class; (2) provides for the release of all Released Claims and enjoins Class Members and Sub-Class Members from asserting, filing, maintaining, or prosecuting any of the Released Claims in the future; (3) orders the dismissal with prejudice of all Released Claims, and incorporates the releases and covenant not to sue stated in this Agreement, with each of the parties to bear its or their own costs and attorneys’ fees, except as provided in Section VII below with respect to Class Counsel’s attorneys’ fees and costs; (4) authorizes the Settlement Administrator to pay Valid Claims in accordance with the terms of the Agreement; (5) authorizes the payment of Class Counsel’s attorneys’ fees and costs as detailed in Section VII below; (6) authorizes the payment of incentive awards to each of the Plaintiffs as detailed in Section VII below; and (7) preserves the Court’s continuing jurisdiction over the administration of the Settlement and enforcement of the Agreement.

VII. CLASS COUNSEL’S ATTORNEYS’ FEES AND COSTS, AND INCENTIVE AWARD TO PLAINTIFFS

A. FXG shall not oppose Class Counsel’s request for attorneys’ fees and costs covering all legal services provided by Class Counsel in the past and future to the members of the Certified Class and the Certified Sub-Class in connection with the Lawsuit (whether before the MDL Court or this Court), the settlement of the Lawsuit, any appeal in connection with the Settlement, implementation of the Settlement, or otherwise (the “Fee and Expense Application”) in an amount not to exceed twenty-five percent (25%) of the common Class Settlement Fund. The Fee and Expense Application shall be subject to Court approval, and the Court will determine what amount of fees and costs shall be awarded and issue an Order stating the amount of fees and costs to be awarded.

B. FXG shall not oppose Class Counsel’s request for an incentive award to each of the seventeen Plaintiffs for up to ten thousand dollars ($10,000.00) above what each is otherwise eligible to receive under Section III of this Agreement. The incentive awards shall be paid from the common Class Settlement Fund.

C. The agreed amounts set forth above in this Section will be subject to Court approval, which approval shall be stated in the Final Approval Order of the Court. Upon the Effective Date, the Settlement Administrator shall, as soon as practicable, but within no more than ten (10) additional business days, pay to Class Counsel and Plaintiffs those amounts specified above from the Class Settlement Fund, as approved by the Court. Class Counsel shall provide to the Settlement Administrator in a timely manner all information needed with respect

17

to the issuance of the checks for those amounts, including their and Plaintiffs’ tax identification/Social Security numbers on Form W-9. The Settlement Administrator shall have no obligation to make payments under this Section until such information is received.

If any notice of an appeal from the Final Approval Order, the judgment thereon, or any Order in the Lawsuit is filed by any party, objector, Class Member, Sub-Class Member, or other person, the Settlement shall not be or become final or effective, and the Settlement Administrator shall not be obliged to make any payment to Class Counsel or to Plaintiffs, until 10 business days after the Effective Date.

D. Upon transferring the Settlement Payment to the Class Settlement Fund, FXG will have no responsibility or liability for any amount of attorneys’ fees or costs for work performed or expenses incurred in connection with the Lawsuit to any of the Plaintiffs’ counsel or any other counsel for Plaintiffs or any Class Member or Sub-Class Member, including any prior firm of the Plaintiffs’ counsel or those involved in the MDL proceedings. In the event any claim for attorneys’ fees or costs in connection with the Lawsuit is made by any counsel other than Class Counsel, the parties agree that FXG has no obligation of any kind to satisfy any such claim. Class Counsel agree to indemnify FXG against any claims for fees or costs made by other counsel for work performed in connection with the Lawsuit. Class Counsel represent that there are no liens related to any fees associated with the claims of the Class Members and Sub-Class Members as of the execution date of this Agreement. FXG shall have no responsibility or liability for any amount of attorneys’ fees or costs attributable to the Lawsuit, including any incurred in connection with the Lawsuit during the MDL proceedings. Any attorneys’ fees or costs dispute between Class Counsel and any other attorney(s) will not interfere with the Settlement, the provisions of this Settlement Agreement, the dismissal of the Lawsuit, or the releases obtained pursuant to the Settlement Agreement.

VIII. RELEASE

By executing this Agreement, the Plaintiffs, on behalf of themselves and the Class Members and Sub-Class Members (including their affiliated business entities, if any), acknowledge that, upon entry of the Final Approval Order by the Court, the Lawsuit shall be dismissed with prejudice, an order of dismissal with prejudice shall be entered, and all Released Claims (as defined in Section I.R above) shall thereby be conclusively settled, compromised, satisfied, and released as to the Releasees.

In connection with such release of claims, Plaintiffs, the Class Members, and the Sub-Class Members hereby acknowledge that they are aware that they or their attorneys may hereafter discover claims or facts in addition to or different from those which they now know or believe to exist with respect to the Released Claims, but that it is their intention to hereby fully, finally, and forever settle and release all of the Released Claims, known or unknown, suspected or unsuspected, that they may have against Releasees. In furtherance of such intention, the release herein given to the Releasees by the Plaintiffs, Class Members, and Sub-Class Members shall be and remain in effect as a full and complete general release of all Released Claims.

Notwithstanding the above, the Court shall retain jurisdiction over the parties, the Class Members, the Sub-Class Members, and the Settlement with respect to the future performance of the terms of this Settlement Agreement, and to assure that all payments and other actions required by the Settlement are properly carried out.

18

IX. COVENANT NOT TO SUE

Plaintiffs, on behalf of themselves, the Class Members and Sub-Class Members, and their affiliated business entities (if any), (a) covenant and agree that neither Plaintiffs nor any of the Class Members or Sub-Class Members, nor any of Plaintiffs’, Class Members’, or Sub-Class Members’ affiliated business entities (if any), nor anyone authorized to act on behalf of any of them, will commence, authorize, or accept any benefit from any judicial or administrative action or proceeding, other than as expressly provided for in this Settlement, against Releasees, or any of them, in either their personal or corporate capacity, with respect to any claim, matter, or issue that in any way arises from, is based on, or relates to any alleged loss, harm, or damages allegedly caused by Releasees, or any of them, in connection with the Released Claims; (b) waive and disclaim any right to any form of recovery, compensation, or other remedy in any such action or proceeding brought by or on behalf of any of them; and (c) agree that this Settlement shall be a complete bar to any such action.

X. REPRESENTATIONS AND WARRANTIES

Each of the parties represents and warrants to, and agrees with, each of the other parties as follows:

A. Each of the parties has had the opportunity to receive, and has received, independent legal advice from her, his, or its attorneys regarding the advisability of making the Settlement, the advisability of executing this Agreement, and the legal and income-tax consequences of this Settlement, and fully understands and accepts the terms of this Settlement.

B. Plaintiffs represent and warrant that no portion of any claim, right, demand, action, or cause of action against any of the Releasees that Plaintiffs are releasing in this Agreement, and no portion of any payment to which Plaintiffs may be entitled, has been assigned, transferred, or conveyed by or for Plaintiffs in any manner; and no person other than the Plaintiffs, the Class Members, and the Sub-Class Members have any legal or equitable interest in the claims, demands, actions, or causes of action to be released in this Agreement.

C. Any other person or entity (including, but not limited to, insurers, lien holders, business partners, related or associated business entities, or other creditors) that has any judgments, liens, subrogation interests, or related claims which arise out of the Released Claims or the damages alleged by the Plaintiffs, the Certified Class, and the Certified Sub-Class as a result of the Released Claims must be satisfied from the payments to Claimants as detailed in Section III. Plaintiffs, Class Members, and Sub-Class Members agree that they are liable for, and will release, hold harmless, defend, and indemnify the Releasees from and against any and all Released Claims, known or unknown, that may be brought by any person, firm, corporation, or other entity, including any lien holders, against the Releasees for any such judgments, liens, interests or claims that exist arising out of the Released Claims.

D. None of the Parties relies or has relied on any statement, representation, omission, inducement, or promise of any other party (or any officer, agent, employee, representative, or attorney for any other party) in executing this Agreement, or in making the Settlement provided for herein, except as expressly stated in this Agreement.

19

E. Each of the Parties has investigated the facts pertaining to the Settlement and this Agreement, and all matters pertaining thereto, to the full extent deemed necessary by that party and his or its attorneys.

F. Each of the Parties has carefully read, and knows and understands, the full contents of this Agreement and is voluntarily entering into this Agreement after having had the opportunity to consult with, and having in fact consulted with, his or its attorneys.

G. Section titles or captions contained herein are inserted as a matter of convenience and for reference, and in no way define, limit, extend or describe the scope of this Settlement or any provision hereof.

H. Each of the Parties has participated in the drafting of all provisions of this Agreement, has had an adequate opportunity to read, review, and consider the effect of the language of this Agreement, and has agreed to its terms.

I. It is understood and agreed that this Agreement is for the compromise of disputed claims and is not to be construed as or deemed to be an admission of any liability, fault, or responsibility on the part of FXG or any other Releasee.

J. It is understood and agreed that the terms and conditions of this Agreement are the result of lengthy, intensive, arm’s-length negotiations between the Parties and that this Agreement shall not be construed in favor of or against any party by reason of the extent to which any party or her, his, or its counsel participated in the drafting of this Agreement.

K. This Agreement constitutes and comprises the entire agreement among the Parties with respect to the subject matter hereof. It supersedes all prior and contemporaneous oral and written agreements and discussions. It may be amended only by an agreement in writing, signed by all Parties hereto.

L. The Parties agree that any dispute regarding the interpretation or enforcement of the terms of this Settlement or in connection with this Agreement shall be resolved by the Court.

XI. MISCELLANEOUS

A. Conditional Nature of Agreement

At the Plaintiffs’ option, expressed in written notice to FXG’s counsel, this Agreement shall become null and void, and no obligation on the part of any of the Parties will accrue, if the Court materially alters any of the terms of this Agreement to the detriment of Plaintiffs, the Certified Class, or the Certified Sub-Class, or fails to enter the Preliminary Approval Order or the Final Approval Order in substantially the form submitted by the Parties, except that a court ruling regarding Class Counsel’s attorneys’ fees and costs shall not be a basis for withdrawal. At FXG’s option, expressed in written notice to Class Counsel, this Agreement shall become null and void, and no obligation on the part of any of the Parties will accrue, if the Court materially

20

alters any of the terms of this Agreement to the detriment of FXG, or fails to enter the Preliminary Approval Order or the Final Approval Order in substantially the form submitted by the Parties. Any appeal by Class Counsel of the attorneys’ fees and costs awarded by the Court in connection with this Settlement shall not be a basis for any party to have this Agreement become null and void. If this Agreement becomes null and void, the Parties shall move forward with the Lawsuit as though no settlement had been reached, all of the Parties to the Lawsuit being placed in the same position they were before this Settlement was proposed, negotiated and agreed upon.

B. Severability

None of the terms of this Agreement is severable from the others. However, if the Court should rule that any term is void, illegal, or unenforceable for any reason, FXG, in its sole discretion, and Plaintiffs, in their sole discretion (but acting in accord with their duties and obligations to the Certified Class and the Certified Sub-Class), may elect to waive any such deficiency and proceed with the Settlement under the terms and conditions ultimately approved by the Court.

C. Effectiveness, Amendments, and Binding Nature

This Agreement may be amended only by written agreement signed by the Parties. Except as otherwise stated above, each of the Parties, including Plaintiffs on behalf of themselves, the Certified Class, and the Certified Sub-Class, expressly accepts and assumes the risk that, if facts or laws pertinent to matters covered by this Agreement are hereafter found to be other than as now believed or assumed by that party to be true or applicable, this Agreement shall nevertheless remain effective.

This Agreement is binding on, and shall inure to the benefit of, the Parties, the Class Members, and the Sub-Class Members, and their respective agents, employees, representatives, officers, directors, parents, subsidiaries, assigns, executors, administrators, insurers, and successors in interest. All Releasees other than FXG, which is a party, are intended to be third-party beneficiaries of this Agreement.

D. Cooperation in Implementation

FXG, Plaintiffs, and their respective counsel (including Class Counsel) agree to prepare and execute any additional documents that may reasonably be necessary to effectuate the terms of this Agreement.

E. Governing Law

This Agreement shall be construed and governed in accordance with the procedural and substantive laws of the State of California without regard to any principles of choice of law, except that all matters of federal tax law and the Class Settlement Fund’s compliance with Internal Revenue Code § 468B and the Treasury Regulations thereunder shall be governed by federal income tax law.

21

F. No Admission of Liability

The Parties are entering into this Settlement for the purpose of compromising and settling disputed claims. Nothing in this Agreement or in the documents relating to the Settlement shall be construed, deemed, or offered as an admission by any of the parties, or by any member of the Certified Class or the Certified Sub-Class, for any purpose in any judicial or administrative action or proceeding, whether in law or in equity, and regardless of whether this Agreement ultimately becomes effective.

G. Income Tax Obligations

No representation has been made to the Plaintiffs, Class Members or Sub-Class Members, or their attorneys by FXG regarding the taxability of any portion of the payments under this Agreement. Plaintiffs, Class Members, Sub-Class Members, and Class Counsel are solely responsible for their own tax filing and payment obligations arising from this Agreement, except that the Settlement Administrator will provide Plaintiffs, Class Members, Sub-Class Members, and Class Counsel with copies of IRS Forms 1099 and/or W-2 as applicable for any payments the Class Settlement Fund makes to them under this Agreement.

H. Signatures

This Agreement may be executed in counterparts, and, when so executed, shall constitute a binding original. A signature, or copy of a signature, transmitted electronically, including by facsimile or email, shall serve as an original for all purposes.

Plaintiffs:		Defendant:
/s/ Dean Alexander		FedEx Ground Package System, Inc.
Dean Alexander
Date:	7-3-15
		By:	/s/ Ward B. Strang
		Its:
/s/ Peter Allen
Peter Allen		Date:	07/04/15
Date:	7-5-2015
/s/ Albert Anaya
Albert Anaya

22

Date:	6-7-15
/s/ Suzanne Andrade
Suzanne Andrade
Date:	July 7, 2015
/s/ Jerrett Henderson
Jerrett Henderson
Date:	7-4-2015
/s/ Ely Ines
Ely Ines
Date:	07-08-2015
/s/ Paul Infantino
Paul Infantino
Date:	7/3/15
/s/ Jorge Isla
Jorge Isla
Date:	July 3, 2015
/s/ Eric Jeppson
Eric Jeppson
Date:	07/06/15

23

/s/ Gupertino Magana
Gupertino Magana
Date:	7-6-2015
/s/ Bernard Mendoza
Bernard Mendoza
Date:	7/5/2015
/s/ Jesse Padilla
Jesse Padilla
Date:	7-9-15
/s/ Joey Rodriguez
Joey Rodriguez
Date:	7-3-15
/s/ Dale Rose
Dale Rose
Date:	7/4/15
/s/ Allan Ross
Allan Ross
Date:	07/08/2015
/s/ Agostino Scalercio
Agostino Scalercio
Date:	7/7/15

24

/s/ Anthony Ybarra
and Anthony Ybarra
Date:	7/3/15
APPROVED AND ACKNOWLEDGED:		APPROVED AND ACKNOWLEDGED:
/s/ Beth Ross		/s/ Carolyn Cubato
Class Counsel		Counsel for FedEx Ground Package System, Inc.

25

EX-12.1

EXHIBIT 12.1

FEDEX CORPORATION

COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES

(UNAUDITED)

(IN MILLIONS, EXCEPT RATIOS)

	Three Months Ended
	August 31,				Year Ended May 31,
	2015		2014		2015		2014		2013		2012 (1)			2011
Earnings:
Income before income taxes	$	1,084	$	1,012	$	1,627	$	3,658	$	4,338	$	(444	)	$	2,002
Add back:
Interest expense, net of capitalized interest		68		51		235		160		82		52			86
Amortization of debt issuance costs		2		1		5		4		5		5			16
Portion of rent expense representative of interest factor		237		221		908		876		864		797			852
Earnings as adjusted	$	1,391	$	1,285	$	2,775	$	4,698	$	5,289	$	410		$	2,956
Fixed Charges:
Interest expense, net of capitalized interest	$	68	$	51	$	235	$	160	$	82	$	52		$	86
Capitalized interest		11		8		37		29		45		85			71
Amortization of debt issuance costs		2		1		5		4		5		5			16
Portion of rent expense representative of interest factor		237		221		908		876		864		797			852
	$	318	$	281	$	1,185	$	1,069	$	996	$	939		$	1,025
Ratio of Earnings to Fixed Charges		4.4		4.6		2.3		4.4		5.3		—			2.9

⁽¹⁾  Earnings for 2012 were inadequate to cover fixed charges. Additional earnings of $529 million would have been necessary to bring the ratio for this period to 1.0.

EX-15.1

EXHIBIT 15.1

The Board of Directors and Stockholders

FedEx Corporation

We are aware of the incorporation by reference in the Registration Statements (Form S-8 Nos. 333-192957, 333-171232, 333-45037, 333-71065, 333-34934, 333-100572, 333-111399, 333-121418, 333-130619, 333-156333 and Form S-3 No. 333-183989) of FedEx Corporation and in the related Prospectuses of our report dated September 17, 2015, relating to the unaudited condensed consolidated interim financial statements of FedEx Corporation that are included in its Form 10-Q for the quarter ended August 31, 2015.

/s/ Ernst & Young LLP

Memphis, Tennessee

September 17, 2015

EX-31.1

EXHIBIT 31.1

CERTIFICATION PURSUANT TO

RULES 13a-14(a) AND 15d-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934,

AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Frederick W. Smith, certify that:

1. I have reviewed this quarterly report on Form 10-Q of FedEx Corporation (the “registrant”);

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: September 17, 2015

/s/ Frederick W. Smith

Frederick W. Smith

Chairman, President and

Chief Executive Officer

EX-31.2

EXHIBIT 31.2

CERTIFICATION PURSUANT TO

RULES 13a-14(a) AND 15d-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934,

AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Alan B. Graf, Jr., certify that:

1. I have reviewed this quarterly report on Form 10-Q of FedEx Corporation (the “registrant”);

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: September 17, 2015

/s/ Alan B. Graf, Jr.

Alan B. Graf, Jr.

Executive Vice President and

Chief Financial Officer

EX-32.1

EXHIBIT 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of FedEx Corporation (“FedEx”) on Form 10-Q for the period ended August 31, 2015 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Frederick W. Smith, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of FedEx.

Date: September 17, 2015

/s/ Frederick W. Smith

Frederick W. Smith

Chairman, President and

Chief Executive Officer

EX-32.2

EXHIBIT 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of FedEx Corporation (“FedEx”) on Form 10-Q for the period ended August 31, 2015 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Alan B. Graf, Jr., certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of FedEx.

Date: September 17, 2015

/s/ Alan B. Graf, Jr.

Alan B. Graf, Jr.

Executive Vice President and

Chief Financial Officer

XML

Contingencies (Details) $ in Millions	3 Months Ended
	Aug. 31, 2015 USD ($)
Loss Contingency [Line Items]
Litigation settlement amount	$ 228

XML

Retirement Plans (Details 3) - USD ($) $ in Millions	3 Months Ended
	Aug. 31, 2015	Aug. 31, 2014
Pension Plans Contributions [Abstract]
Required U.S. pension plan contributions	$ 6	$ 82
Voluntary U.S. pension plan contributions	159	83
U.S. domestic pension contributions	165	$ 165
September 2015 U.S. Pension Plans contribution	$ 165

XML

Supplemental Cash Flow Information (Tables)

3 Months Ended

Aug. 31, 2015

Supplemental Cash Flow (Tables) [Abstract]

Supplemental Cash Flow Table

		2015		2014
Cash payments for:
	Interest (net of capitalized interest)	$	139	$	96
	Income taxes	$	115	$	190
	Income tax refunds received		(2)		(2)
	Cash tax payments, net	$	113	$	188

XML

Condensed Consolidating Financial Statements (Details 2) - USD ($) $ in Millions	Aug. 31, 2015	May. 31, 2015	Aug. 31, 2014	May. 31, 2014
CURRENT ASSETS
Cash and cash equivalents	$ 3,543	$ 3,763	$ 2,416	$ 2,908
Receivables, less allowances	5,617	5,719
Spare parts, supplies, fuel, prepaid expenses and other, less allowances	937	853
Deferred income taxes	606	606
Total current assets	10,703	10,941
PROPERTY AND EQUIPMENT, AT COST	43,989	42,864
Less accumulated depreciation and amortization	22,506	21,989
Net property and equipment	21,483	20,875
Goodwill	3,792	3,810
Other assets	1,267	1,443
ASSETS	37,245	37,069
CURRENT LIABILITIES
Current portion of long-term debt	14	19
Accrued salaries and employee benefits	1,355	1,436
Accounts payable	2,049	2,066
Accrued expenses	2,426	2,436
Total current liabilities	5,844	5,957
LONG-TERM DEBT, LESS CURRENT PORTION	7,244	7,249
OTHER LONG-TERM LIABILITIES
Deferred income taxes	1,781	1,747
Other liabilities	7,093	7,123
Total other long-term liabilities	8,874	8,870
STOCKHOLDERS' INVESTMENT	15,283	14,993
LIABILITIES AND STOCKHOLDERS' INVESTMENT	37,245	37,069
Parent Company Member
CURRENT ASSETS
Cash and cash equivalents	2,224	2,383	1,305	1,756
Receivables, less allowances	1	3
Spare parts, supplies, fuel, prepaid expenses and other, less allowances	25	41
Total current assets	2,250	2,427
PROPERTY AND EQUIPMENT, AT COST	29	29
Less accumulated depreciation and amortization	23	23
Net property and equipment	6	6
INVESTMENT IN SUBSIDIARIES	23,722	23,173
Other assets	2,761	2,752
ASSETS	28,739	28,358
CURRENT LIABILITIES
Accrued salaries and employee benefits	44	34
Accounts payable	77	5
Accrued expenses	745	604
Total current liabilities	866	643
LONG-TERM DEBT, LESS CURRENT PORTION	6,978	6,978
INTERCOMPANY PAYABLE	2,228	2,249
OTHER LONG-TERM LIABILITIES
Other liabilities	3,384	3,495
Total other long-term liabilities	3,384	3,495
STOCKHOLDERS' INVESTMENT	15,283	14,993
LIABILITIES AND STOCKHOLDERS' INVESTMENT	28,739	28,358
Guarantor Subsidiaries Member
CURRENT ASSETS
Cash and cash equivalents	446	487	430	441
Receivables, less allowances	4,308	4,383
Spare parts, supplies, fuel, prepaid expenses and other, less allowances	777	689
Deferred income taxes	572	571
Total current assets	6,103	6,130
PROPERTY AND EQUIPMENT, AT COST	41,521	40,364
Less accumulated depreciation and amortization	21,202	20,685
Net property and equipment	20,319	19,679
INTERCOMPANY RECEIVABLE	533	686
Goodwill	1,551	1,552
INVESTMENT IN SUBSIDIARIES	3,817	3,800
Other assets	781	898
ASSETS	33,104	32,745
CURRENT LIABILITIES
Current portion of long-term debt	6	7
Accrued salaries and employee benefits	1,133	1,208
Accounts payable	1,326	1,433
Accrued expenses	1,400	1,557
Total current liabilities	3,865	4,205
LONG-TERM DEBT, LESS CURRENT PORTION	248	248
OTHER LONG-TERM LIABILITIES
Deferred income taxes	4,237	4,206
Other liabilities	3,446	3,367
Total other long-term liabilities	7,683	7,573
STOCKHOLDERS' INVESTMENT	21,308	20,719
LIABILITIES AND STOCKHOLDERS' INVESTMENT	33,104	32,745
Non Guarantor Subsidiaries Member
CURRENT ASSETS
Cash and cash equivalents	917	971	821	861
Receivables, less allowances	1,349	1,385
Spare parts, supplies, fuel, prepaid expenses and other, less allowances	135	123
Deferred income taxes	34	35
Total current assets	2,435	2,514
PROPERTY AND EQUIPMENT, AT COST	2,439	2,471
Less accumulated depreciation and amortization	1,281	1,281
Net property and equipment	1,158	1,190
INTERCOMPANY RECEIVABLE	1,695	1,563
Goodwill	2,241	2,258
Other assets	416	477
ASSETS	7,945	8,002
CURRENT LIABILITIES
Current portion of long-term debt	8	12
Accrued salaries and employee benefits	178	194
Accounts payable	731	758
Accrued expenses	281	275
Total current liabilities	1,198	1,239
LONG-TERM DEBT, LESS CURRENT PORTION	18	23
OTHER LONG-TERM LIABILITIES
Deferred income taxes	235	225
Other liabilities	263	261
Total other long-term liabilities	498	486
STOCKHOLDERS' INVESTMENT	6,231	6,254
LIABILITIES AND STOCKHOLDERS' INVESTMENT	7,945	8,002
Consolidation Eliminations Member
CURRENT ASSETS
Cash and cash equivalents	(44)	(78)	$ (140)	$ (150)
Receivables, less allowances	(41)	(52)
Total current assets	(85)	(130)
INTERCOMPANY RECEIVABLE	(2,228)	(2,249)
INVESTMENT IN SUBSIDIARIES	(27,539)	(26,973)
Other assets	(2,691)	(2,684)
ASSETS	(32,543)	(32,036)
CURRENT LIABILITIES
Accounts payable	(85)	(130)
Total current liabilities	(85)	(130)
INTERCOMPANY PAYABLE	(2,228)	(2,249)
OTHER LONG-TERM LIABILITIES
Deferred income taxes	(2,691)	(2,684)
Total other long-term liabilities	(2,691)	(2,684)
STOCKHOLDERS' INVESTMENT	(27,539)	(26,973)
LIABILITIES AND STOCKHOLDERS' INVESTMENT	$ (32,543)	$ (32,036)

XML

Commitments (Details 3) $ in Millions	Aug. 31, 2015 USD ($)
Schedule of Future Minimum Operating Lease Payments [Line Items]
2016 (remainder)	$ 1,686
2017	2,293
2018	1,804
2019	1,560
2020	1,316
Thereafter	7,714
Total	16,373
Aircraft and Related Equipment [Member]
Schedule of Future Minimum Operating Lease Payments [Line Items]
2016 (remainder)	430
2017	403
2018	332
2019	274
2020	190
Thereafter	360
Total	1,989
Facilities and Other [Member]
Schedule of Future Minimum Operating Lease Payments [Line Items]
2016 (remainder)	1,256
2017	1,890
2018	1,472
2019	1,286
2020	1,126
Thereafter	7,354
Total	$ 14,384

XML

Accumulated Other Comprehensive Income (Loss)

3 Months Ended

Aug. 31, 2015

Accumulated Other Comprehensive Income Loss Net Of Tax [Abstract]

Accumulated Other Comprehensive Income (Loss)

(2)Accumulated Other Comprehensive Income

The following table provides changes in accumulated other comprehensive income (“AOCI”), net of tax, reported in our unauditedcondensed consolidated financial statements for the three-month periods ended August 31 (in millions; amounts in parentheses indicate debits to AOCI):

		2015		2014
Foreign currency translation gain (loss):
	Balance at beginning of period	$	(253)	$	81
	Translation adjustments		(138)		(31)
	Balance at end of period		(391)		50
Retirement plans adjustments:
	Balance at beginning of period		425		425
	Reclassifications from AOCI		(24)		(16)
	Balance at end of period		401		409
Accumulated other comprehensive income at end of period		$	10	$	459

The following table presents details of the reclassifications from AOCI for the three-month periods ended August 31 (in millions; amounts in parentheses indicate debits to earnings):

		Amount Reclassified from AOCI				Affected Line Item in the Income Statement
		2015		2014
	Amortization of retirement plans prior service credits	$	31	$	26	Salaries and employee benefits
	Income tax benefit		(7)		(10)	Provision for income taxes
AOCI reclassifications, net of tax		$	24	$	16	Net income

XML

Condensed Consolidating Financial Statements (Details 3) - USD ($) $ in Millions	3 Months Ended
	Aug. 31, 2015	Aug. 31, 2014
Condensed Financial Statements Captions [Line Items]
REVENUES	$ 12,279	$ 11,684
OPERATING EXPENSES:
Salaries and employee benefits	4,525	4,114
Purchased transportation	2,344	2,054
Rentals and landing fees	695	660
Depreciation and amortization	648	651
Fuel	712	1,120
Maintenance and repairs	548	556
Other	1,663	1,467
OPERATING EXPENSES	11,135	10,622
OPERATING INCOME	1,144	1,062
OTHER INCOME (EXPENSE):
Interest, net	(63)	(48)
Other, net	3	(2)
INCOME BEFORE INCOME TAXES	1,084	1,012
PROVISION FOR INCOME TAXES	392	359
NET INCOME	692	653
COMPREHENSIVE INCOME	530	606
Parent Company Member
OPERATING EXPENSES:
Salaries and employee benefits	34	30
Rentals and landing fees	1	1
Intercompany charges, net	(69)	(95)
Other	34	64
OTHER INCOME (EXPENSE):
Equity in earnings of subsidiaries	692	653
Interest, net	(75)	(53)
Intercompany charges, net	78	54
Other, net	(3)	(1)
INCOME BEFORE INCOME TAXES	692	653
NET INCOME	692	653
COMPREHENSIVE INCOME	674	636
Guarantor Subsidiaries Member
Condensed Financial Statements Captions [Line Items]
REVENUES	9,873	9,769
OPERATING EXPENSES:
Salaries and employee benefits	3,813	3,534
Purchased transportation	1,434	1,386
Rentals and landing fees	587	572
Depreciation and amortization	583	595
Fuel	691	1,095
Maintenance and repairs	508	522
Intercompany charges, net	(40)	2
Other	1,264	1,165
OPERATING EXPENSES	8,840	8,871
OPERATING INCOME	1,033	898
OTHER INCOME (EXPENSE):
Equity in earnings of subsidiaries	61	98
Interest, net	8	4
Intercompany charges, net	(76)	(59)
Other, net	(3)	(3)
INCOME BEFORE INCOME TAXES	1,023	938
PROVISION FOR INCOME TAXES	357	296
NET INCOME	666	642
COMPREHENSIVE INCOME	651	638
Non Guarantor Subsidiaries Member
Condensed Financial Statements Captions [Line Items]
REVENUES	2,509	2,004
OPERATING EXPENSES:
Salaries and employee benefits	678	550
Purchased transportation	965	711
Rentals and landing fees	108	88
Depreciation and amortization	65	56
Fuel	21	25
Maintenance and repairs	40	34
Intercompany charges, net	109	93
Other	412	283
OPERATING EXPENSES	2,398	1,840
OPERATING INCOME	111	164
OTHER INCOME (EXPENSE):
Interest, net	4	1
Intercompany charges, net	(2)	5
Other, net	9	2
INCOME BEFORE INCOME TAXES	122	172
PROVISION FOR INCOME TAXES	35	63
NET INCOME	87	109
COMPREHENSIVE INCOME	(42)	83
Consolidation Eliminations Member
Condensed Financial Statements Captions [Line Items]
REVENUES	(103)	(89)
OPERATING EXPENSES:
Purchased transportation	(55)	(43)
Rentals and landing fees	(1)	(1)
Other	(47)	(45)
OPERATING EXPENSES	(103)	(89)
OTHER INCOME (EXPENSE):
Equity in earnings of subsidiaries	(753)	(751)
INCOME BEFORE INCOME TAXES	(753)	(751)
NET INCOME	(753)	(751)
COMPREHENSIVE INCOME	$ (753)	$ (751)

XML

Financing Arrangements (Details) - USD ($) $ in Millions	3 Months Ended
	Aug. 31, 2015	May. 31, 2015
Financing Arrangements (Details) [Line Items]
Line Of Credit Facility Maximum Borrowing Capacity	$ 1,000
Line Of Credit Facility Current Borrowing Capacity	1,000
Long Term Debt Exclusive of Capital Leases Carrying Value	7,200	$ 7,200
Long Term Debt Exclusive Of Capital Leases Fair Value	$ 7,200	$ 7,400
Line of Credit Facility, Expiration Date	Mar. 01, 2018
Line Of Credit Facility Covenant Terms Maximum Leverage Ratio	70%
Line Of Credit Facility Covenant Terms Leverage Ratio	61%

XML

Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Millions	3 Months Ended
	Aug. 31, 2015	Aug. 31, 2014
Accumulated Other Comprehensive Income Loss [Line Items]
Beginning balance	$ 172
Translation adjustment	(138)	$ (31)
Amortization of prior service credit, net of tax of $7 in 2015 and $10 in 2014	(24)	(16)
Ending balance	10	459
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items]
Salaries and employee benefits	4,525	4,114
PROVISION FOR INCOME TAXES	392	359
Foreign currency translation gain (loss) [Member]
Accumulated Other Comprehensive Income Loss [Line Items]
Beginning balance	(253)	81
Translation adjustment	(138)	(31)
Ending balance	(391)	50
Retirement plans adjustments [Member]
Accumulated Other Comprehensive Income Loss [Line Items]
Beginning balance	425	425
Reclassification from AOCI	(24)	(16)
Ending balance	401	409
Reclassification Out Of Accumulated Other Comprehensive Income [Member]
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items]
Salaries and employee benefits	31	26
PROVISION FOR INCOME TAXES	(7)	(10)
Net income	$ 24	$ 16

XML

Condensed Consolidating Financial Statements (Details 4) - USD ($) $ in Millions	3 Months Ended
	Aug. 31, 2015	Aug. 31, 2014
Condensed Financial Statements Captions [Line Items]
Cash provided by (used in) operating activities	$ 1,241	$ 982
Investing Activities:
Capital expenditures	(1,209)	(720)
Proceeds from asset dispositions and other	10	4
Cash used in investing activities	(1,199)	(716)
Financing Activities:
Principal payments on debt	(15)
Proceeds from stock issuances	46	97
Excess tax benefit on the exercise of stock options	6	10
Dividends paid	(71)	(57)
Purchase of treasury stock	(190)	(791)
Cash used in financing activities	(224)	(741)
Effect of exchange rate changes on cash	(38)	(17)
Net decrease in cash and cash equivalents	(220)	(492)
Cash and cash equivalents at beginning of period	3,763	2,908
Cash and cash equivalents at end of period	3,543	2,416
Parent Company Member
Condensed Financial Statements Captions [Line Items]
Cash provided by (used in) operating activities	(397)	(67)
Investing Activities:
Capital expenditures		(1)
Proceeds from asset dispositions and other	(5)
Cash used in investing activities	(5)	(1)
Financing Activities:
Net transfers from (to) Parent	452	358
Proceeds from stock issuances	46	97
Excess tax benefit on the exercise of stock options	6	10
Dividends paid	(71)	(57)
Purchase of treasury stock	(190)	(791)
Cash used in financing activities	243	(383)
Net decrease in cash and cash equivalents	(159)	(451)
Cash and cash equivalents at beginning of period	2,383	1,756
Cash and cash equivalents at end of period	2,224	1,305
Guarantor Subsidiaries Member
Condensed Financial Statements Captions [Line Items]
Cash provided by (used in) operating activities	1,533	934
Investing Activities:
Capital expenditures	(1,170)	(688)
Proceeds from asset dispositions and other	15	7
Cash used in investing activities	(1,155)	(681)
Financing Activities:
Net transfers from (to) Parent	(479)	(366)
Payment on loan between subsidiaries	98	103
Intercompany dividends	4	2
Principal payments on debt	(2)
Other, net	(25)	(1)
Cash used in financing activities	(404)	(262)
Effect of exchange rate changes on cash	(15)	(2)
Net decrease in cash and cash equivalents	(41)	(11)
Cash and cash equivalents at beginning of period	487	441
Cash and cash equivalents at end of period	446	430
Non Guarantor Subsidiaries Member
Condensed Financial Statements Captions [Line Items]
Cash provided by (used in) operating activities	71	105
Investing Activities:
Capital expenditures	(39)	(31)
Proceeds from asset dispositions and other		(3)
Cash used in investing activities	(39)	(34)
Financing Activities:
Net transfers from (to) Parent	27	8
Payment on loan between subsidiaries	(98)	(103)
Intercompany dividends	(4)	(2)
Principal payments on debt	(13)
Other, net	25	1
Cash used in financing activities	(63)	(96)
Effect of exchange rate changes on cash	(23)	(15)
Net decrease in cash and cash equivalents	(54)	(40)
Cash and cash equivalents at beginning of period	971	861
Cash and cash equivalents at end of period	917	821
Consolidation Eliminations Member
Condensed Financial Statements Captions [Line Items]
Cash provided by (used in) operating activities	34	10
Financing Activities:
Net decrease in cash and cash equivalents	34	10
Cash and cash equivalents at beginning of period	(78)	(150)
Cash and cash equivalents at end of period	$ (44)	$ (140)

XML

Computation of Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions		3 Months Ended
		Aug. 31, 2015	Aug. 31, 2014
Basic earnings per common share:
Net earnings allocable to common shares	[1]	$ 691	$ 653
Weighted-average common shares		282.0	285.0
Basic earnings per common share		$ 2.45	$ 2.29
Diluted earnings per common share:
Net earnings allocable to common shares	[1]	$ 691	$ 653
Weighted-average common shares		282.0	285.0
Dilutive effect of share-based awards		4.0	4.0
Weighted-average diluted shares		286.0	289.0
Diluted earnings per common share		$ 2.42	$ 2.26
Anti-dilutive options excluded from diluted earnings per common share		3.5	2.1

[1] Net earnings available to participating securities were immaterial in all periods presented.

XML

Retirement Plans (Details 1) - USD ($) $ in Millions	3 Months Ended
	Aug. 31, 2015	Aug. 31, 2014
Pension and Other Postretirement Benefit Expense [Abstract]
Defined benefit pension plans	$ 53	$ (7)
Defined contribution plans	102	94
Postretirement healthcare plans	21	20
Retirement plans costs	$ 176	$ 107

XML

General

3 Months Ended

Aug. 31, 2015

General [Abstract]

General

(1) General

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES. These interim financial statements of FedEx Corporation (“FedEx”) have been prepared in accordance with accounting principles generally accepted in the United States and Securities and Exchange Commission (“SEC”) instructions for interim financial information, and should be read in conjunction with our Annual Report on Form 10-K for the year ended May 31,2015(“Annual Report”). Accordingly, significant accounting policies and other disclosures normally provided have been omitted since such items are disclosed in our Annual Report.

In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments (including normal recurring adjustments) necessary to present fairly our financial position as of August 31,2015, and the results of our operations and cash flows for the three-month periods ended August 31, 2015 and 2014. Operating results for the three-month period ended August 31, 2015 are not necessarily indicative of the results that may be expected for the year ending May 31,2016.

Except as otherwise specified, references to years indicate our fiscal year ending May 31, 2016 or ended May 31 of the year referenced and comparisons are to the corresponding period of the prior year.

REVENUE RECOGNITION. On June 1, 2015, we began recording revenues associated with the FedEx SmartPost service on a gross basis including postal fees in revenues and expenses, versus our previous net treatment, due to operational changes occurring in 2016 which result in us being the principal in all cases for the FedEx SmartPost service. This change has been recognized prospectively.

BUSINESS ACQUISITIONS. As discussed in our Annual Report, on April 6, 2015, we entered into a conditional agreement to acquire TNT Express N.V. (“TNT Express”) for €4.4 billion (currently, approximately $5.0 billion). This combination is expected to expand our global portfolio, particularly in Europe, lower our costs to serve our European markets by increasing density in our pickup-and-delivery operations and accelerate our global growth. This acquisition is expected to be completed in the first half of calendar year 2016. The closing of the acquisition is subject to customary conditions, including obtaining all necessary approvals and competition clearances. We expect to secure all relevant competition approvals.

As discussed in our Annual Report, we completed our acquisitions ofGENCO Distribution System, Inc. (“GENCO”) and BongoInternational, LLC (“Bongo”)inthe third quarter of 2015 andhave included the financial results and estimated fair values of the assets and liabilities related to these acquisitions in the FedEx Ground and FedEx Express segments, respectively. These acquisitions are included in the accompanying balance sheets based on a preliminaryallocation of the purchase price (summarized in the table below, in millions) which reflects immaterial updates from the May 31, 2015 estimate.

Current assets	$	350
Property and equipment		113
Goodwill		1,170
Intangible assets		139
Other non-current assets		25
Current liabilities		(245)
Long-term liabilities		(97)
Total purchase price	$	1,455

The goodwill recorded is primarily attributable to expected benefits from synergies of the combinations with existing businesses and other acquired entities and the work force in place at GENCO. The majority of the purchase price allocated to goodwill is not deductible for U.S. income tax purposes. The intangible assets acquired consist primarily of customer-related intangible assets, which are amortized on an accelerated basis over an estimated life of 15 years.

EMPLOYEES UNDER COLLECTIVE BARGAINING ARRANGEMENTS. The pilots of FedEx Express, which represent a small number of FedEx Express's total employees, are employed under a collective bargaining agreement. The contract became amendable in March 2013.  After participating in negotiations assisted by the National Mediation Board (“NMB”), the parties reached a Tentative Agreement (“TA”) on August 19, 2015.  The TA is currently out for a membership ratification vote which will close in mid-October.  If the TA is ratified, it will become effective November 2, 2015 and will become amendable in November 2021. If the TA is not ratified, the parties will reenter NMB mediated negotiations. The NMB is the U.S. governmental agency that oversees labor agreements for entities covered by the Railway Labor Act of 1926, as amended. In addition to our pilots at FedEx Express, GENCO has a small number of employees who are members of unions, and certain non-U.S. employees are unionized.

STOCK-BASED COMPENSATION. We have two types of equity-based compensation: stock options and restricted stock. The key terms of the stock option and restricted stock awards granted under our incentive stock plans and all financial disclosures about these programs are set forth in our Annual Report.

Our stock-based compensation expense was$53 millionfor the three-month period ended August 31,2015 and $48 million for the three-month period ended August 31, 2014. Due to its immateriality, additional disclosures related to stock-based compensation have been excluded from this quarterly report.

RECENT ACCOUNTING GUIDANCE. New accounting rules and disclosure requirements can significantly impact our reported results and the comparability of our financial statements. These matters are described in our Annual Report.

We believe that no other new accounting guidance was adopted or issued during the first three months of 2016 that is relevant to the readers of our financial statements. However, there are numerous new proposals under development which, if and when enacted, may have a significant impact on our financial reporting.

TREASURY SHARES.In September 2014, our Board of Directors authorized the repurchase of up to 15 million shares of common stock. During the first quarter of 2016, we repurchased 1.1 million shares of FedEx common stock at an average price of $172 per share for a total of $190 million. As of August 31, 2015, 11.1 million shares remained under the share repurchase authorization. This authorization may be utilized to offset equity compensation dilution and for opportunistic repurchases based on market conditions and other factors. The timing and volume of repurchases are at the discretion of FedEx management.

DIVIDENDS DECLARED PER COMMON SHARE. On August 14, 2015, our Board of Directors declared a quarterly dividend of $0.25 per share of common stock. The dividend will be paid on October 1, 2015 to stockholders of record as of the close of business on September 10, 2015. Each quarterly dividend payment is subject to review and approval by our Board of Directors, and we evaluate our dividend payment amount on an annual basis at the end of each fiscal year.

XML

Retirement Plans (Details 2) - USD ($) $ in Millions	3 Months Ended
	Aug. 31, 2015	Aug. 31, 2014
Pension Plans
Net Periodic Benefit Cost
Service cost	$ 166	$ 164
Interest cost	295	275
Expected return on plan assets	(377)	(420)
Amortization of prior service credits	(31)	(26)
Total net periodic benefit cost	53	(7)
Postretirement Healthcare Plans
Net Periodic Benefit Cost
Service cost	10	10
Interest cost	11	10
Total net periodic benefit cost	$ 21	$ 20

XML

Supplemental Cash Flow Information (Details) - USD ($) $ in Millions	3 Months Ended
	Aug. 31, 2015	Aug. 31, 2014
Supplemental Cash Flow Information [Abstract]
Interest (net of capitalized interest)	$ 139	$ 96
Income taxes	115	190
Income tax refunds received	(2)	(2)
Cash tax payments, net	$ 113	$ 188

XML

Condensed Consolidated Balance Sheets - USD ($) $ in Millions	Aug. 31, 2015	May. 31, 2015
CURRENT ASSETS
Cash and cash equivalents	$ 3,543	$ 3,763
Receivables, less allowances of $190 and $185	5,617	5,719
Spare parts, supplies and fuel, less allowances of $214 and $207	488	498
Deferred income taxes	606	606
Prepaid expenses and other	449	355
Total current assets	10,703	10,941
PROPERTY AND EQUIPMENT, AT COST	43,989	42,864
Less accumulated depreciation and amortization	22,506	21,989
Net property and equipment	21,483	20,875
OTHER LONG-TERM ASSETS
Goodwill	3,792	3,810
Other assets	1,267	1,443
Total other long-term assets	5,059	5,253
ASSETS	37,245	37,069
CURRENT LIABILITIES
Current portion of long-term debt	14	19
Accrued salaries and employee benefits	1,355	1,436
Accounts payable	2,049	2,066
Accrued expenses	2,426	2,436
Total current liabilities	5,844	5,957
LONG-TERM DEBT, LESS CURRENT PORTION	7,244	7,249
OTHER LONG-TERM LIABILITIES
Deferred income taxes	1,781	1,747
Pension, postretirement healthcare and other benefit obligations	4,806	4,893
Self-insurance accruals	1,186	1,120
Deferred lease obligations	766	711
Deferred gains, principally related to aircraft transactions	174	181
Other liabilities	161	218
Total other long-term liabilities	$ 8,874	$ 8,870
COMMITMENTS AND CONTINGENCIES
COMMON STOCKHOLDERS' INVESTMENT
Common stock, $0.10 par value; 800 million shares authorized; 318 million shares issued as of August 31, 2015 and May 31, 2015	$ 32	$ 32
Additional paid-in capital	2,814	2,786
Retained earnings	17,434	16,900
Accumulated other comprehensive income	10	172
Treasury stock, at cost	(5,007)	(4,897)
Total common stockholders' investment	15,283	14,993
LIABILITIES AND STOCKHOLDERS' INVESTMENT	$ 37,245	$ 37,069

XML

Condensed Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Millions	3 Months Ended
	Aug. 31, 2015	Aug. 31, 2014
Other Comprehensive Income, Tax Amounts
Foreign currency translation adjustments, tax	$ 13	$ 9
Amortization of prior service credit, net of tax	$ 7	$ 10

XML

Commitments (Details 1) $ in Millions		Aug. 31, 2015 USD ($)
Schedule of Purchase Commitments [Line Items]
2016 (remainder)		$ 1,472
2017		1,504
2018		1,888
2019		1,655
2020		1,661
Thereafter		6,060
Total		14,240
Aircraft And Related Equipment Commitments [Member]
Schedule of Purchase Commitments [Line Items]
2016 (remainder)		657
2017		1,240
2018		1,739
2019		1,584
2020		1,638
Thereafter		5,962
Total		12,820
Other Commitments [Member]
Schedule of Purchase Commitments [Line Items]
2016 (remainder)	[1]	815
2017	[1]	264
2018	[1]	149
2019	[1]	71
2020	[1]	23
Thereafter	[1]	98
Total	[1]	$ 1,420

[1] Primarily equipment, advertising contracts and, for the remainder of 2016, $495 million of estimated required quarterly contributions to our U.S. Pension Plans.

XML

Retirement Plans (Tables)

3 Months Ended

Aug. 31, 2015

Retirement Plan (Tables) [Abstract]

Schedule of Retirement Plan Costs

	2015		2014
Defined benefit pension plans	$	53	$	(7)
Defined contribution plans		102		94
Postretirement healthcare plans		21		20
	$	176	$	107

Schedule of Net Periodic Benefit Cost

	Pension Plans				Postretirement Healthcare Plans
	2015		2014		2015		2014
Service cost	$	166	$	164	$	10	$	10
Interest cost		295		275		11		10
Expected return on plan assets		(377)		(420)		-		-
Amortization of prior service credit		(31)		(26)		-		-
	$	53	$	(7)	$	21	$	20

Schedule of Pension Plans Contributions

	2015		2014
Required	$	6	$	82
Voluntary		159		83
	$	165	$	165

XML

Commitments (Details 2) - Aug. 31, 2015	USD ($)
Schedule of Aircraft Commitments [Line Items]
2016 (remainder)	7
2017	12
2018	18
2019	15
2020	15
Thereafter	35
Total	102
Boeing 777 Freighter [Member]
Schedule of Aircraft Commitments [Line Items]
2016 (remainder)	1
2018	2
2019	2
2020	3
Thereafter	9
Total	17
Boeing 767 Freighter [Member]
Schedule of Aircraft Commitments [Line Items]
2016 (remainder)	6
2017	12
2018	16
2019	13
2020	12
Thereafter	26
Total	85

XML

Commitments (Tables)

3 Months Ended

Aug. 31, 2015

Commitments (Tables) [Abstract]

Schedule of Purchase Commitments

		Aircraft and
		Aircraft-Related		Other(1)		Total
2016 (remainder)		$	657	$	815	$	1,472
2017			1,240		264		1,504
2018			1,739		149		1,888
2019			1,584		71		1,655
2020			1,638		23		1,661
Thereafter			5,962		98		6,060
Total		$	12,820	$	1,420	$	14,240
(1)	Primarily equipment, advertising contracts and, for the remainder of 2016, $495 million of estimated required quarterly contributions to our U.S. Pension Plans.

Schedule of Aircraft Purchase Commitments

	B767F	B777F	Total
2016 (remainder)	6	1	7
2017	12	-	12
2018	16	2	18
2019	13	2	15
2020	12	3	15
Thereafter	26	9	35
Total	85	17	102

Schedule of Future Minimum Lease Payments, Operating Leases

	Operating Leases
	Aircraft				Total
	and Related		Facilities		Operating
	Equipment		and Other		Leases
2016 (remainder)	$	430	$	1,256	$	1,686
2017		403		1,890		2,293
2018		332		1,472		1,804
2019		274		1,286		1,560
2020		190		1,126		1,316
Thereafter		360		7,354		7,714
Total	$	1,989	$	14,384	$	16,373

XML

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Millions	3 Months Ended
	Aug. 31, 2015	Aug. 31, 2014
Operating Activities:
Net income	$ 692	$ 653
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation and amortization	648	651
Provision for uncollectible accounts	28	35
Stock-based compensation	53	48
Deferred income taxes and other noncash items	20	(22)
Changes in assets and liabilities:
Receivables	50	(86)
Other assets	(89)	(30)
Accounts payable and other liabilities	(151)	(257)
Other, net	(10)	(10)
Cash provided by operating activities	1,241	982
Investing Activities:
Capital expenditures	(1,209)	(720)
Proceeds from asset dispositions and other	10	4
Cash used in investing activities	(1,199)	(716)
Financing Activities:
Principal payments on debt	(15)
Proceeds from stock issuances	46	97
Excess tax benefit on the exercise of stock options	6	10
Dividends paid	(71)	(57)
Purchase of treasury stock	(190)	(791)
Cash used in financing activities	(224)	(741)
Effect of exchange rate changes on cash	(38)	(17)
Net decrease in cash and cash equivalents	(220)	(492)
Cash and cash equivalents at beginning of period	3,763	2,908
Cash and cash equivalents at end of period	$ 3,543	$ 2,416

XML

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) shares in Millions, $ in Millions	Aug. 31, 2015	May. 31, 2015
CURRENT ASSETS
Allowances for receivables	$ 190	$ 185
Allowances for spare parts, supplies and fuel	$ 214	$ 207
COMMON STOCKHOLDERS' INVESTMENT
Common stock, par value	$ 0.10	$ 0.10
Common stock, shares authorized	800	800
Common stock, shares issued	318	318

XML

Condensed Consolidating Financial Statements

3 Months Ended

Aug. 31, 2015

Condensed Consolidating Financial Statements [Abstract]

Condensed Consolidating Financial Statements

(10) Condensed Consolidating Financial Statements

We are required to present condensed consolidating financial information in order for the subsidiary guarantors of our public debt to continue to be exempt from reporting under the Securities Exchange Act of 1934, as amended.FedEx Express, however, currently files reports under such act.

The guarantor subsidiaries, which are wholly owned by FedEx, guarantee $7.0billion of our debt. The guarantees are full and unconditional and joint and several. Our guarantor subsidiaries were not determined using geographic, service line or other similar criteria, and as a result, the "Guarantor Subsidiaries" and "Non-guarantor Subsidiaries" columns each include portions of our domestic and international operations. Accordingly, this basis of presentation is not intended to present our financial condition, results of operations or cash flows for any purpose other than to comply with the specific requirements for subsidiary guarantor reporting. Prior year amounts have been recast to conform to the pension accounting changes as discussed in our Annual Report.

Condensed consolidating financial statements for our guarantor subsidiaries and non-guarantor subsidiaries are presented in the following tables (in millions):

CONDENSED CONSOLIDATING BALANCE SHEETS
(UNAUDITED)
August 31, 2015
						Guarantor		Non-guarantor
				Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
ASSETS
CURRENT ASSETS
	Cash and cash equivalents			$	2,224	$	446	$	917	$	(44)	$	3,543
	Receivables, less allowances				1		4,308		1,349		(41)		5,617
	Spare parts, supplies, fuel, prepaid expenses
		and other, less allowances			25		777		135		-		937
	Deferred income taxes				-		572		34		-		606
			Total current assets		2,250		6,103		2,435		(85)		10,703
PROPERTY AND EQUIPMENT, AT COST					29		41,521		2,439		-		43,989
	Less accumulated depreciation and amortization				23		21,202		1,281		-		22,506
			Net property and equipment		6		20,319		1,158		-		21,483
INTERCOMPANY RECEIVABLE					-		533		1,695		(2,228)		-
GOODWILL					-		1,551		2,241		-		3,792
INVESTMENT IN SUBSIDIARIES					23,722		3,817		-		(27,539)		-
OTHER ASSETS					2,761		781		416		(2,691)		1,267
				$	28,739	$	33,104	$	7,945	$	(32,543)	$	37,245
LIABILITIES AND STOCKHOLDERS' INVESTMENT
CURRENT LIABILITIES
	Current portion of long-term debt			$	-	$	6	$	8	$	-	$	14
	Accrued salaries and employee benefits				44		1,133		178		-		1,355
	Accounts payable				77		1,326		731		(85)		2,049
	Accrued expenses				745		1,400		281		-		2,426
		Total current liabilities			866		3,865		1,198		(85)		5,844
LONG-TERM DEBT, LESS CURRENT PORTION					6,978		248		18		-		7,244
INTERCOMPANY PAYABLE					2,228		-		-		(2,228)		-
OTHER LONG-TERM LIABILITIES
	Deferred income taxes				-		4,237		235		(2,691)		1,781
	Other liabilities				3,384		3,446		263		-		7,093
		Total other long-term liabilities			3,384		7,683		498		(2,691)		8,874
STOCKHOLDERS' INVESTMENT					15,283		21,308		6,231		(27,539)		15,283
				$	28,739	$	33,104	$	7,945	$	(32,543)	$	37,245

CONDENSED CONSOLIDATING BALANCE SHEETS
May 31, 2015
						Guarantor		Non-guarantor
				Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
ASSETS
CURRENT ASSETS
	Cash and cash equivalents			$	2,383	$	487	$	971	$	(78)	$	3,763
	Receivables, less allowances				3		4,383		1,385		(52)		5,719
	Spare parts, supplies, fuel, prepaid expenses
		and other, less allowances			41		689		123		-		853
	Deferred income taxes				-		571		35		-		606
			Total current assets		2,427		6,130		2,514		(130)		10,941
PROPERTY AND EQUIPMENT, AT COST					29		40,364		2,471		-		42,864
	Less accumulated depreciation and amortization				23		20,685		1,281		-		21,989
			Net property and equipment		6		19,679		1,190		-		20,875
INTERCOMPANY RECEIVABLE					-		686		1,563		(2,249)		-
GOODWILL					-		1,552		2,258		-		3,810
INVESTMENT IN SUBSIDIARIES					23,173		3,800		-		(26,973)		-
OTHER ASSETS					2,752		898		477		(2,684)		1,443
				$	28,358	$	32,745	$	8,002	$	(32,036)	$	37,069
LIABILITIES AND STOCKHOLDERS' INVESTMENT
CURRENT LIABILITIES
	Current portion of long-term debt			$	-	$	7	$	12	$	-	$	19
	Accrued salaries and employee benefits				34		1,208		194		-		1,436
	Accounts payable				5		1,433		758		(130)		2,066
	Accrued expenses				604		1,557		275		-		2,436
		Total current liabilities			643		4,205		1,239		(130)		5,957
LONG-TERM DEBT, LESS CURRENT PORTION					6,978		248		23		-		7,249
INTERCOMPANY PAYABLE					2,249		-		-		(2,249)		-
OTHER LONG-TERM LIABILITIES
	Deferred income taxes				-		4,206		225		(2,684)		1,747
	Other liabilities				3,495		3,367		261		-		7,123
		Total other long-term liabilities			3,495		7,573		486		(2,684)		8,870
STOCKHOLDERS' INVESTMENT					14,993		20,719		6,254		(26,973)		14,993
				$	28,358	$	32,745	$	8,002	$	(32,036)	$	37,069

CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME
(UNAUDITED)
Three Months Ended August 31, 2015
				Guarantor		Non-guarantor
		Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
REVENUES		$	-	$	9,873	$	2,509	$	(103)	$	12,279
OPERATING EXPENSES:
	Salaries and employee benefits		34		3,813		678		-		4,525
	Purchased transportation		-		1,434		965		(55)		2,344
	Rentals and landing fees		1		587		108		(1)		695
	Depreciation and amortization		-		583		65		-		648
	Fuel		-		691		21		-		712
	Maintenance and repairs		-		508		40		-		548
	Intercompany charges, net		(69)		(40)		109		-		-
	Other		34		1,264		412		(47)		1,663
			-		8,840		2,398		(103)		11,135
OPERATING INCOME			-		1,033		111		-		1,144
OTHER INCOME (EXPENSE):
	Equity in earnings of subsidiaries		692		61		-		(753)		-
	Interest, net		(75)		8		4		-		(63)
	Intercompany charges, net		78		(76)		(2)		-		-
	Other, net		(3)		(3)		9		-		3
INCOME BEFORE INCOME TAXES			692		1,023		122		(753)		1,084
	Provision for income taxes		-		357		35		-		392
NET INCOME		$	692	$	666	$	87	$	(753)	$	692
COMPREHENSIVE INCOME		$	674	$	651	$	(42)	$	(753)	$	530
CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME
(UNAUDITED)
Three Months Ended August 31, 2014
(As Adjusted)
				Guarantor		Non-guarantor
		Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
REVENUES		$	-	$	9,769	$	2,004	$	(89)	$	11,684
OPERATING EXPENSES:
	Salaries and employee benefits		30		3,534		550		-		4,114
	Purchased transportation		-		1,386		711		(43)		2,054
	Rentals and landing fees		1		572		88		(1)		660
	Depreciation and amortization		-		595		56		-		651
	Fuel		-		1,095		25		-		1,120
	Maintenance and repairs		-		522		34		-		556
	Intercompany charges, net		(95)		2		93		-		-
	Other		64		1,165		283		(45)		1,467
			-		8,871		1,840		(89)		10,622
OPERATING INCOME			-		898		164		-		1,062
OTHER INCOME (EXPENSE):
	Equity in earnings of subsidiaries		653		98		-		(751)		-
	Interest, net		(53)		4		1		-		(48)
	Intercompany charges, net		54		(59)		5		-		-
	Other, net		(1)		(3)		2		-		(2)
INCOME BEFORE INCOME TAXES			653		938		172		(751)		1,012
	Provision for income taxes		-		296		63		-		359
NET INCOME		$	653	$	642	$	109	$	(751)	$	653
COMPREHENSIVE INCOME		$	636	$	638	$	83	$	(751)	$	606

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
(UNAUDITED)
Three Months Ended August 31, 2015
				Guarantor		Non-guarantor
		Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES		$	(397)	$	1,533	$	71	$	34	$	1,241
INVESTING ACTIVITIES
	Capital expenditures		-		(1,170)		(39)		-		(1,209)
	Proceeds from asset dispositions and other		(5)		15		-		-		10
CASH USED IN INVESTING ACTIVITIES			(5)		(1,155)		(39)		-		(1,199)
FINANCING ACTIVITIES
	Net transfers from (to) Parent		452		(479)		27		-		-
	Payment on loan between subsidiaries		-		98		(98)		-		-
	Intercompany dividends		-		4		(4)		-		-
	Principal payments on debt		-		(2)		(13)		-		(15)
	Proceeds from stock issuances		46		-		-		-		46
	Excess tax benefit on the exercise of stock options		6		-		-		-		6
	Dividends paid		(71)		-		-		-		(71)
	Purchase of treasury stock		(190)		-		-		-		(190)
	Other, net		-		(25)		25		-		-
CASH (USED IN) PROVIDED BY FINANCING ACTIVITIES			243		(404)		(63)		-		(224)
Effect of exchange rate changes on cash			-		(15)		(23)		-		(38)
Net (decrease) increase in cash and cash equivalents			(159)		(41)		(54)		34		(220)
Cash and cash equivalents at beginning of period			2,383		487		971		(78)		3,763
Cash and cash equivalents at end of period		$	2,224	$	446	$	917	$	(44)	$	3,543
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
(UNAUDITED)
Three Months Ended August 31, 2014
				Guarantor		Non-guarantor
		Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES		$	(67)	$	934	$	105	$	10	$	982
INVESTING ACTIVITIES
	Capital expenditures		(1)		(688)		(31)		-		(720)
	Proceeds from asset dispositions and other		-		7		(3)		-		4
CASH USED IN INVESTING ACTIVITIES			(1)		(681)		(34)		-		(716)
FINANCING ACTIVITIES
	Net transfers from (to) Parent		358		(366)		8		-		-
	Payment on loan between subsidiaries		-		103		(103)		-		-
	Intercompany dividends		-		2		(2)		-		-
	Proceeds from stock issuances		97		-		-		-		97
	Excess tax benefit on the exercise of stock options		10		-		-		-		10
	Dividends paid		(57)		-		-		-		(57)
	Purchase of treasury stock		(791)		-		-		-		(791)
	Other, net		-		(1)		1		-		-
CASH USED IN FINANCING ACTIVITIES			(383)		(262)		(96)		-		(741)
Effect of exchange rate changes on cash			-		(2)		(15)		-		(17)
Net (decrease) increase in cash and cash equivalents			(451)		(11)		(40)		10		(492)
Cash and cash equivalents at beginning of period			1,756		441		861		(150)		2,908
Cash and cash equivalents at end of period		$	1,305	$	430	$	821	$	(140)	$	2,416

XML

Document and Entity Information - USD ($) $ in Billions	3 Months Ended
	Aug. 31, 2015	Sep. 16, 2015	Nov. 28, 2014
Document and Entity Information [Abstract]
Document Type	10-Q
Document Period End Date	Aug. 31, 2015
Amendment Flag	false
Document Fiscal Year Focus	2016
Document Fiscal Period Focus	Q1
Entity Registrant Name	FedEx Corporation
Entity Central Index Key	0001048911
Current Fiscal Year End Date	--05-31
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Public Float			$ 40.5
Entity Common Stock, Shares Outstanding		282,379,446
TradingSymbol	FDX

XML

General (Policies)

3 Months Ended

Aug. 31, 2015

General (Policies) [Abstract]

Summary of Significant Accounting Policies

(1) General

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES. These interim financial statements of FedEx Corporation (“FedEx”) have been prepared in accordance with accounting principles generally accepted in the United States and Securities and Exchange Commission (“SEC”) instructions for interim financial information, and should be read in conjunction with our Annual Report on Form 10-K for the year ended May 31,2015(“Annual Report”). Accordingly, significant accounting policies and other disclosures normally provided have been omitted since such items are disclosed in our Annual Report.

In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments (including normal recurring adjustments) necessary to present fairly our financial position as of August 31,2015, and the results of our operations and cash flows for the three-month periods ended August 31, 2015 and 2014. Operating results for the three-month period ended August 31, 2015 are not necessarily indicative of the results that may be expected for the year ending May 31,2016.

Except as otherwise specified, references to years indicate our fiscal year ending May 31, 2016 or ended May 31 of the year referenced and comparisons are to the corresponding period of the prior year.

XML

Condensed Consolidated Statements of Income - USD ($) $ in Millions	3 Months Ended
	Aug. 31, 2015	Aug. 31, 2014
Condensed Consolidated Statements of Income
REVENUES	$ 12,279	$ 11,684
OPERATING EXPENSES:
Salaries and employee benefits	4,525	4,114
Purchased transportation	2,344	2,054
Rentals and landing fees	695	660
Depreciation and amortization	648	651
Fuel	712	1,120
Maintenance and repairs	548	556
Other	1,663	1,467
OPERATING EXPENSES	11,135	10,622
OPERATING INCOME	1,144	1,062
OTHER INCOME (EXPENSE):
Interest, net	(63)	(48)
Other, net	3	(2)
OTHER INCOME (EXPENSE)	(60)	(50)
INCOME BEFORE INCOME TAXES	1,084	1,012
PROVISION FOR INCOME TAXES	392	359
NET INCOME	$ 692	$ 653
EARNINGS PER COMMON SHARE:
Basic	$ 2.45	$ 2.29
Diluted	2.42	2.26
DIVIDENDS DECLARED PER COMMON SHARE	$ 0.50	$ 0.40

XML

Retirement Plans

3 Months Ended

Aug. 31, 2015

Retirement Plans [Abstract]

Retirement Plans

(5) Retirement Plans

We sponsor programs that provide retirement benefits to most of our employees. These programs include defined benefit pension plans, defined contribution plans and postretirement healthcare plans. Key terms of our retirement plans are provided in our Annual Report. Our retirement plans costs for the three-month periods ended August 31 were as follows (in millions):

	2015		2014
Defined benefit pension plans	$	53	$	(7)
Defined contribution plans		102		94
Postretirement healthcare plans		21		20
	$	176	$	107

Net periodic benefit cost of the pension and postretirement healthcare plans for the three-monthperiods ended August 31 included the following components (in millions):

	Pension Plans				Postretirement Healthcare Plans
	2015		2014		2015		2014
Service cost	$	166	$	164	$	10	$	10
Interest cost		295		275		11		10
Expected return on plan assets		(377)		(420)		-		-
Amortization of prior service credit		(31)		(26)		-		-
	$	53	$	(7)	$	21	$	20

Contributions to our tax qualified U.S. domestic pension plans (“U.S. Pension Plans”) for the three-month periods ended August 31 were as follows (in millions):

	2015		2014
Required	$	6	$	82
Voluntary		159		83
	$	165	$	165

In September 2015, we made anadditional required contribution of $165 million to our U.S. Pension Plans.Our U.S. Pension Plans have ample funds to meet expected benefit payments.

XML

Computation of Earnings Per Share

3 Months Ended

Aug. 31, 2015

Earnings Per Share [Abstract]

Computation of Earnings Per Share

(4) Computation of Earnings Per Share

The calculation of basic and diluted earnings per common share for the three-month periods ended August 31 was as follows (in millions, except per share amounts):

		2015		2014
Basic earnings per common share:
Net earnings allocable to common shares(1)		$	691	$	653
Weighted-average common shares			282		285
Basic earnings per common share		$	2.45	$	2.29
Diluted earnings per common share:
Net earnings allocable to common shares(1)		$	691	$	653
Weighted-average common shares			282		285
Dilutive effect of share-based awards			4		4
Weighted-average diluted shares			286		289
Diluted earnings per common share		$	2.42	$	2.26
Anti-dilutive options excluded from diluted
	earnings per common share		3.5		2.1

(1) Net earnings available to participating securities were immaterial in all periods presented.

XML

Business Segment Information (Tables)

3 Months Ended

Aug. 31, 2015

Business Segment Information (Tables) [Abstract]

Schedule of Segment Information

		2015		2014
Revenues
	FedEx Express segment	$	6,591	$	6,862
	FedEx Ground segment		3,830		2,960
	FedEx Freight segment		1,601		1,609
	FedEx Services segment		390		374
	Eliminations and other		(133)		(121)
		$	12,279	$	11,684
Operating Income
	FedEx Express segment	$	545	$	377
	FedEx Ground segment		537		545
	FedEx Freight segment		132		168
	Eliminations, corporate and other		(70)		(28)
		$	1,144	$	1,062

XML

Acquisition (Tables)

3 Months Ended

Aug. 31, 2015

Acquisition (Tables) [Abstract]

Schedule of Purchase Price Allocation

Current assets	$	350
Property and equipment		113
Goodwill		1,170
Intangible assets		139
Other non-current assets		25
Current liabilities		(245)
Long-term liabilities		(97)
Total purchase price	$	1,455

XML

Contingencies

3 Months Ended

Aug. 31, 2015

Loss Contingency [Abstract]

Contingencies

(8) Contingencies

Wage-and-Hour. We are a defendant in a number of lawsuits containing various class-action allegations of wage-and-hour violations. The plaintiffs in these lawsuits allege, among other things, that they were forced to work “off the clock,” were not paid overtime or were not provided work breaks or other benefits. The complaints generally seek unspecified monetary damages, injunctive relief, or both. We do not believe that a material loss is reasonably possible with respect to any of these matters.

Independent Contractor — Lawsuits and State Administrative Proceedings. FedEx Ground is involved in numerous class-action lawsuits (including 25 that have been certified as class actions), individual lawsuits and state tax and other administrative proceedings that claim that the company's owner-operators should be treated as employees, rather than independent contractors.

Most of the class-action lawsuits were consolidated for administration of the pre-trial proceedings by a single federal court, the U.S. District Court for the Northern District of Indiana. The multidistrict litigation court granted class certification in 28 cases and denied it in 14 cases. On December 13, 2010, the court entered an opinion and order addressing all outstanding motions for summary judgment on the status of the owner-operators (i.e., independent contractor vs. employee). In sum, the court ruled on our summary judgment motions and entered judgment in favor of FedEx Ground on all claims in 20 of the 28 multidistrict litigation cases that had been certified as class actions, finding that the owner-operators in those cases were contractors as a matter of the law of 20 states. The plaintiffs filed notices of appeal in all of these 20 cases. The Seventh Circuit heard the appeal in the Kansas case in January 2012 and, in July 2012, issued an opinion that did not make a determination with respect to the correctness of the district court's decision and, instead, certified two questions to the Kansas Supreme Court related to the classification of the plaintiffs as independent contractors under the Kansas Wage Payment Act. The other 19 cases that are before the Seventh Circuit were stayed pending a decision of the Kansas Supreme Court.

On October 3, 2014, the Kansas Supreme Court determined that a 20 factor right to control test applies to claims under the Kansas Wage Payment Act and concluded that under that test, the class members were employees, not independent contractors. The case was subsequently transferred back to the Seventh Circuit, where both parties made filings requesting the action necessary to complete the resolution of the appeals. The parties also made recommendations to the court regarding next steps for the other 19 cases that are before the Seventh Circuit. FedEx Ground requested that each of those cases be separately briefed given the potential differences in the applicable state law from that in Kansas. During the second quarter of 2015, we established an accrual for the estimated probable loss in the Kansas case that was required to be recognized pursuant to applicable accounting standards. This amount was immaterial.

On July 8, 2015, the Seventh Circuit issued an order and opinion confirming the decision of the Kansas Supreme Court, concluding that the class members are employees, not independent contractors. Additionally, the Seventh Circuit referred the other 19 cases to a representative of the court for purposes of setting a case management conference to address briefing and argument for those cases.

The multidistrict litigation court remanded the other eight certified class actions back to the district courts where they were originally filed because its summary judgment ruling did not completely dispose of all of the claims in those lawsuits. Three of these matters settled for immaterial amounts and have received court approval. One of the cases is currently pending in the Eastern District of Arkansas. Another case was appealed to the Eleventh Circuit Court of Appeals where the court reversed the class-wide summary judgment decision on May 28, 2015 and remanded the case for trial, holding that there are disputed issues of fact as to whether the class members are employees or independent contractors. Two cases in Oregon and one in California were appealed to the Ninth Circuit Court of Appeals, where the court reversed the district court decisions and held that the plaintiffs in California and Oregon were employees as a matter of law and remanded the cases to their respective district courts for further proceedings. In the first quarter of 2015, we recognized an accrual for the then-estimated probable loss in those cases that was required to be recognized pursuant to applicable accounting standards. This amount was immaterial.

In June 2015, the parties in the California case engaged in mediation and reached an agreement to settle the matter for $228 million, and in the fourth quarter of 2015 we increased the accrual to that amount. The settlement agreement is pending court approval.

In the Oregon cases, material exposure above the accrued amount is reasonably possible. We continue to evaluate what facts may arise in the course of discovery and what legal rulings the courts may render and how these facts and rulings might impact FedEx Ground's loss. For a number of reasons, we are not currently able to estimate a range of reasonably possible loss in excess of the amount accrued. The number and identities of plaintiffs in these lawsuits are uncertain, as they are dependent on how the class of full-time drivers is defined and how many individuals will qualify based on whatever criteria may be established. In addition, the parties have conducted only very limited discovery into damages, which could vary considerably from plaintiff to plaintiff and be dependent on evidence pertaining to individual plaintiffs, which has yet to be produced in the cases. Further, the range of potential loss could be impacted substantially by future rulings by the court, including on the merits of the claims, on FedEx Ground's defenses, and on evidentiary issues.

With respect to the matters that are pending outside of Oregon, it is reasonably possible that potential loss in some of these lawsuits or changes to the independent contractor status of FedEx Ground's owner-operators could be material. Similar to our analysis of loss contingency in the Oregon cases, we continue to evaluate what facts may arise in the course of discovery and what legal rulings the courts may render and how these facts and rulings might impact FedEx Ground's loss. As a consequence of many of the same factors described above, as well as others that are specific to these cases, we are not currently able to estimate a range of reasonably possible loss. We do not believe that a material loss is probable in these matters.

In addition, we are defending contractor-model cases that are not or are no longer part of the multidistrict litigation. These cases are in varying stages of litigation, and we do not expect to incur a material loss in any of these matters.

Adverse determinations in matters related to FedEx Ground's independent contractors, could, among other things, entitle certain of our owner-operators and their drivers to the reimbursement of certain expenses and to the benefit of wage-and-hour laws and result in employment and withholding tax and benefit liability for FedEx Ground, and could result in changes to the independent contractor status of FedEx Ground's owner-operators in certain jurisdictions. We believe that FedEx Ground's owner-operators are properly classified as independent contractors and that FedEx Ground is not an employer of the drivers of the company's independent contractors.

City and State of New York Cigarette Suit. On December 30, 2013, the City of New York filed suit against FedEx Express and FedEx Ground arising from our alleged shipments of cigarettes to New York City residents. The claims against FedEx Express were subsequently dismissed. On March 30, 2014, the complaint was amended adding the State of New York as a plaintiff. Beyond the addition of the State as a plaintiff, the amended complaint contains several amplifications of the previous claims. First, the claims now relate to four shippers, none of which continues to ship in our network. Second, the amended complaint contains a count for violation of the Assurance of Compliance (“AOC”) we had previously entered into with the State of New York, claiming that since 2006, FedEx has made shipments of cigarettes to residences in New York in violation of the AOC. Lastly, the amendment contains new theories of Racketeer Influenced and Corrupt Organizations Act (“RICO”) violations. In May 2014, we filed a motion to dismiss almost all of the claims. On November 12, 2014, the City and State of New York filed a separate but almost identical lawsuit that includes two additional shippers. This complaint was amended in May 2015 to include additional shippers. On March 9, 2015, the court ruled on our motion to dismiss in the first case, granting our motions to limit the applicable statute of limitations to four years and to dismiss a portion of the claims. The court, however, denied our motion to dismiss some of the claims, including the RICO claims. Loss in these lawsuits is reasonably possible, but the amount of any loss is expected to be immaterial.

Environmental Matters. SEC regulations require disclosure of certain environmental matters when a governmental authority is a party to the proceedings and the proceedings involve potential monetary sanctions that management reasonably believes could exceed $100,000.

In February 2014, FedEx Ground received oral communications from District Attorneys' Offices (representing California's county environmental authorities) and the California Attorney General's Office (representing the California Division of Toxic Substances Control (“DTSC”)) that they were seeking civil penalties for alleged violations of the state's hazardous waste regulations. Specifically, the California environmental authorities alleged that FedEx Ground improperly generates and/or handles, stores and transports hazardous waste from its stations to its hubs in California. In April 2014, FedEx Ground filed a declaratory judgment action in the United States District Court for the Eastern District of California against the Director of the California DTSC and the County District Attorneys with whom we have been negotiating. In June 2014, the California Attorney General filed a complaint against FedEx Ground in Sacramento County Superior Court alleging violations by FedEx Ground as described above. The County District Attorneys filed a similar complaint in Sacramento County Superior Court in July 2014. The county and state authorities filed a motion to dismiss FedEx Ground's declaratory judgment action, and their motion was granted on January 22, 2015. FedEx Ground filed a notice of appeal with the Ninth Circuit Court of Appeals on February 23, 2015. FedEx Ground and the County District Attorneys reached an agreement to resolve all claims between them, and on August 10, 2015, they filed a negotiated final judgment in Sacramento County Superior Court. In the fourth quarter of 2015, we established an accrual for the final judgment amount, which was immaterial. Loss is reasonably possible as to the action commenced by the DTSC; however, the amount of any loss is expected to be immaterial.

On January 14, 2014, the U.S. Department of Justice (“DOJ”) issued a Grand Jury Subpoena to FedEx Express relating to an asbestos matter previously investigated by the U.S. Environmental Protection Agency. On May 1, 2014, the DOJ informed us that it had determined to continue to pursue the matter as a criminal case, citing seven asbestos-related regulatory violations associated with removal of roof materials from a hangar in Puerto Rico during cleaning and repair activity, as well as violation of waste disposal requirements. Loss is reasonably possible; however, the amount of any loss is expected to be immaterial.

Department of Justice Indictment — Internet Pharmacy Shipments. In the past, we received requests for information from the DOJ in the Northern District of California in connection with a criminal investigation relating to the transportation of packages for online pharmacies that may have shipped pharmaceuticals in violation of federal law. In July 2014, the DOJ filed a criminal indictment in the United States District Court for the Northern District of California in connection with the matter. A superseding indictment was filed in August 2014. The indictment alleges that FedEx Corporation, FedEx Express and FedEx Services, together with certain pharmacies, conspired to unlawfully distribute controlled substances, unlawfully distributed controlled substances and conspired to unlawfully distribute misbranded drugs. The superseding indictment adds conspiracy to launder money counts related to services provided to and payments from online pharmacies. We continue to believe that our employees have acted in good faith at all times and that we have not engaged in any illegal activities.

Accordingly, we will vigorously defend ourselves in this matter. If we are convicted, remedies could include fines, penalties, forfeiture and compliance conditions. Given the early stage of this proceeding, we cannot estimate the amount or range of loss, if any; however, it is reasonably possible that it could be material if we are convicted.

Other Matters.On June 30, 2014, we received a Statement of Objections from the French Competition Authority (“FCA”) addressed to FedEx Express France, formerly known as TATEX, regarding an investigation by the FCA into anticompetitive behavior that is alleged to have occurred primarily in the framework of trade association meetings that included the former general managers of TATEX prior to our acquisition of that company in July 2012. In September 2014, FedEx Express France submitted its observations in response to the Statement of Objections to the FCA. In April 2015, the FCA issued a report responding to the observations submitted by all companies involved in the investigation. We submitted an answer to the FCA's report in early July. A hearing in this matter before the Board of the FCA has been set for September 30, 2015. Loss in this matter is probable, and in the fourth quarter of 2015 we established an accrual for the estimated probable loss. This amount was immaterial.

FedEx and its subsidiaries are subject to other legal proceedings that arise in the ordinary course of their business. In the opinion of management, the aggregate liability, if any, with respect to these other actions will not have a material adverse effect on our financial position, results of operations or cash flows.

XML

Business Segment Information

3 Months Ended

Aug. 31, 2015

Business Segment Information [Abstract]

Business Segment Information

(6) Business Segment Information

We provide a broad portfolio of transportation, e-commerce and business services through companies competing collectively, operating independently and managed collaboratively under the respected FedEx brand. Our primary operating companies include FedEx Express, the world's largest express transportation company; FedEx Ground Package System, Inc. (“FedEx Ground”), a leading North American provider of small-package ground delivery services; and FedEx Freight, Inc. (“FedEx Freight”), a leading U.S. providerof less-than-truckload (“LTL”) freight services.

Our reportable segments include the following businesses:

FedEx Express Segment	FedEx Express (express transportation)
	FedEx Trade Networks (air and ocean freight forwarding and customs
		brokerage)
	FedEx SupplyChain Systems (logistics services)
	Bongo (cross-border enablement technology and solutions)
FedEx Ground Segment	FedEx Ground (small-package ground delivery)
	GENCO (third-party logistics)
FedEx Freight Segment	FedEx Freight (LTL freight transportation)
	FedEx Custom Critical (time-critical transportation)
FedEx Services Segment	FedEx Services (sales, marketing, information technology, communications
		and back-office functions)
	FedEx TechConnect (customer service, technical support, billings
		and collections)
	FedEx Office (document and business services and package acceptance)

FedEx Services Segment

The FedEx Services segment operates combined sales, marketing, administrative and information technology functions in shared services operations that support our transportation businesses and allow us to obtain synergies from the combination of these functions. For the international regions of FedEx Express, some of these functions are performed on a regional basis by FedEx Express and reported in the FedEx Express segment in their natural expense line items.

The FedEx Services segment provides direct and indirect support to our transportation businesses, and we allocate all of the net operating costs of the FedEx Services segment (including the net operating results of FedEx Office) to reflect the full cost of operating our transportation businesses in the results of those segments. Within the FedEx Services segment allocation, the net operating results of FedEx Office, which are an immaterial component of our allocations, are allocated to FedEx Express and FedEx Ground. We review and evaluate the performance of our transportation segments based on operating income (inclusive of FedEx Services segment allocations). For the FedEx Services segment, performance is evaluated based on the impact of its total allocated net operating costs on our transportation segments.

Operating expenses for each of our transportation segments include the allocations from the FedEx Services segment to the respective transportation segments. These allocations also include charges and credits for administrative services provided between operating companies. The allocations of net operating costs are based on metrics such as relative revenues or estimated services provided. We believe these allocations approximate the net cost of providing these functions.Our allocation methodologies are refined periodically, as necessary, to reflect changes in our businesses.

Eliminations, Corporate and Other

Certain FedEx operating companies provide transportation and related services for other FedEx companies outside their reportable segment. Billings for such services are based on negotiated rates, which we believe approximate fair value, and are reflected as revenues of the billing segment. These rates are adjusted from time to time based on market conditions. Such intersegment revenues and expenses are eliminated in our consolidated results and are not separately identified in the following segment information,because the amounts are not material.

Corporate and other includes corporate headquarters costs for executive officers, certain other legal and financial functions, as well as certain other costs and credits not attributed to our core business. These costs are not allocated to the business segments

The following table provides a reconciliation of reportable segment revenues and operating income to our unaudited condensed consolidated financial statement totals for the three-month periods ended August 31 (in millions):

		2015		2014
Revenues
	FedEx Express segment	$	6,591	$	6,862
	FedEx Ground segment		3,830		2,960
	FedEx Freight segment		1,601		1,609
	FedEx Services segment		390		374
	Eliminations and other		(133)		(121)
		$	12,279	$	11,684
Operating Income
	FedEx Express segment	$	545	$	377
	FedEx Ground segment		537		545
	FedEx Freight segment		132		168
	Eliminations, corporate and other		(70)		(28)
		$	1,144	$	1,062

XML

Commitments

3 Months Ended

Aug. 31, 2015

Commitments [Abstract]

Commitments

(7) Commitments

As of August 31, 2015, our purchase commitments under various contracts for the remainder of 2016 and annually thereafter were as follows (in millions):

		Aircraft and
		Aircraft-Related		Other(1)		Total
2016 (remainder)		$	657	$	815	$	1,472
2017			1,240		264		1,504
2018			1,739		149		1,888
2019			1,584		71		1,655
2020			1,638		23		1,661
Thereafter			5,962		98		6,060
Total		$	12,820	$	1,420	$	14,240
(1)	Primarily equipment, advertising contracts and, for the remainder of 2016, $495 million of estimated required quarterly contributions to our U.S. Pension Plans.

The amounts reflected in the table above for purchase commitments represent noncancelable agreements to purchase goods or services.As of August 31, 2015, our obligation to purchase six Boeing 767-300 Freighter (“B767F”) aircraft and nine Boeing 777 Freighter (“B777F”) aircraft is conditioned upon there being no event that causes FedEx Express or its employees not to be covered by the Railway Labor Act of 1926, as amended. Open purchase orders that are cancelable are not considered unconditional purchase obligations for financial reporting purposes and are not included in the table above.

On July 21, 2015, FedEx Express entered into a supplemental agreement to purchase 50 additional B767F aircraft from Boeing. Four of the 50 additional B767F aircraft purchases are conditioned upon there being no event that causes FedEx Express or its employees not to be covered by the Railway Labor Act of 1926, as amended. The 50 additional B767F aircraft are expected to be delivered from fiscal 2018 through fiscal 2023 and will enable FedEx Express to continue to improve the efficiency and reliability of its aircraft fleet.

We had $411 million in deposits and progress payments as of August 31, 2015 on aircraft purchases and other planned aircraft-related transactions. These deposits are classified in the “Other assets” caption of our consolidated balance sheets. Aircraft and aircraft-related contracts are subject to price escalations. The following table is a summary of the key aircraft we are committed to purchase as of August 31, 2015 with the year of expected delivery:

	B767F	B777F	Total
2016 (remainder)	6	1	7
2017	12	-	12
2018	16	2	18
2019	13	2	15
2020	12	3	15
Thereafter	26	9	35
Total	85	17	102

A summary of future minimum lease payments undernoncancelable operating leases with an initial or remaining term in excess of one year at August 31, 2015 is as follows (in millions):

	Operating Leases
	Aircraft				Total
	and Related		Facilities		Operating
	Equipment		and Other		Leases
2016 (remainder)	$	430	$	1,256	$	1,686
2017		403		1,890		2,293
2018		332		1,472		1,804
2019		274		1,286		1,560
2020		190		1,126		1,316
Thereafter		360		7,354		7,714
Total	$	1,989	$	14,384	$	16,373

Future minimum lease payments under capital leases were immaterial at August 31,2015.While certain of our lease agreements contain covenants governing the use of the leased assets or require us to maintain certain levels of insurance, none of our lease agreements include material financial covenants or limitations.

XML

Supplemental Cash Flow Information

3 Months Ended

Aug. 31, 2015

Supplemental Cash Flow Information [Abstract]

Supplemental Cash Flow Information

(9) Supplemental Cash Flow Information

Cash paid for interest expense and income taxes for the three-month periods ended August 31 was as follows (in millions):

		2015		2014
Cash payments for:
	Interest (net of capitalized interest)	$	139	$	96
	Income taxes	$	115	$	190
	Income tax refunds received		(2)		(2)
	Cash tax payments, net	$	113	$	188

XML

Business Segment Information (Details) - USD ($) $ in Millions	3 Months Ended
	Aug. 31, 2015	Aug. 31, 2014
Segment Reporting Information [Line Items]
Revenues	$ 12,279	$ 11,684
Operating Income	1,144	1,062
FedEx Express Segment [Member]
Segment Reporting Information [Line Items]
Revenues	6,591	6,862
Operating Income	545	377
FedEx Ground Segment [Member]
Segment Reporting Information [Line Items]
Revenues	3,830	2,960
Operating Income	537	545
FedEx Freight Segment [Member]
Segment Reporting Information [Line Items]
Revenues	1,601	1,609
Operating Income	132	168
FedEx Services Segment [Member]
Segment Reporting Information [Line Items]
Revenues	390	374
Eliminations, corporate and other
Segment Reporting Information [Line Items]
Revenues	(133)	(121)
Operating Income	$ (70)	$ (28)

XML

Computation of Earnings Per Share (Tables)

3 Months Ended

Aug. 31, 2015

Computation Of Earnings Per Share (Tables) [Abstract]

Schedule of basic and diluted earnings per common share

		2015		2014
Basic earnings per common share:
Net earnings allocable to common shares(1)		$	691	$	653
Weighted-average common shares			282		285
Basic earnings per common share		$	2.45	$	2.29
Diluted earnings per common share:
Net earnings allocable to common shares(1)		$	691	$	653
Weighted-average common shares			282		285
Dilutive effect of share-based awards			4		4
Weighted-average diluted shares			286		289
Diluted earnings per common share		$	2.42	$	2.26
Anti-dilutive options excluded from diluted
	earnings per common share		3.5		2.1

(1) Net earnings available to participating securities were immaterial in all periods presented.

XML

Condensed Consolidating Financial Statements (Tables)

3 Months Ended

Aug. 31, 2015

Condensed Consolidating Financial Statements (Tables) [Abstract]

Condensed Consolidating Balance Sheets

CONDENSED CONSOLIDATING BALANCE SHEETS
(UNAUDITED)
August 31, 2015
						Guarantor		Non-guarantor
				Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
ASSETS
CURRENT ASSETS
	Cash and cash equivalents			$	2,224	$	446	$	917	$	(44)	$	3,543
	Receivables, less allowances				1		4,308		1,349		(41)		5,617
	Spare parts, supplies, fuel, prepaid expenses
		and other, less allowances			25		777		135		-		937
	Deferred income taxes				-		572		34		-		606
			Total current assets		2,250		6,103		2,435		(85)		10,703
PROPERTY AND EQUIPMENT, AT COST					29		41,521		2,439		-		43,989
	Less accumulated depreciation and amortization				23		21,202		1,281		-		22,506
			Net property and equipment		6		20,319		1,158		-		21,483
INTERCOMPANY RECEIVABLE					-		533		1,695		(2,228)		-
GOODWILL					-		1,551		2,241		-		3,792
INVESTMENT IN SUBSIDIARIES					23,722		3,817		-		(27,539)		-
OTHER ASSETS					2,761		781		416		(2,691)		1,267
				$	28,739	$	33,104	$	7,945	$	(32,543)	$	37,245
LIABILITIES AND STOCKHOLDERS' INVESTMENT
CURRENT LIABILITIES
	Current portion of long-term debt			$	-	$	6	$	8	$	-	$	14
	Accrued salaries and employee benefits				44		1,133		178		-		1,355
	Accounts payable				77		1,326		731		(85)		2,049
	Accrued expenses				745		1,400		281		-		2,426
		Total current liabilities			866		3,865		1,198		(85)		5,844
LONG-TERM DEBT, LESS CURRENT PORTION					6,978		248		18		-		7,244
INTERCOMPANY PAYABLE					2,228		-		-		(2,228)		-
OTHER LONG-TERM LIABILITIES
	Deferred income taxes				-		4,237		235		(2,691)		1,781
	Other liabilities				3,384		3,446		263		-		7,093
		Total other long-term liabilities			3,384		7,683		498		(2,691)		8,874
STOCKHOLDERS' INVESTMENT					15,283		21,308		6,231		(27,539)		15,283
				$	28,739	$	33,104	$	7,945	$	(32,543)	$	37,245

CONDENSED CONSOLIDATING BALANCE SHEETS
May 31, 2015
						Guarantor		Non-guarantor
				Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
ASSETS
CURRENT ASSETS
	Cash and cash equivalents			$	2,383	$	487	$	971	$	(78)	$	3,763
	Receivables, less allowances				3		4,383		1,385		(52)		5,719
	Spare parts, supplies, fuel, prepaid expenses
		and other, less allowances			41		689		123		-		853
	Deferred income taxes				-		571		35		-		606
			Total current assets		2,427		6,130		2,514		(130)		10,941
PROPERTY AND EQUIPMENT, AT COST					29		40,364		2,471		-		42,864
	Less accumulated depreciation and amortization				23		20,685		1,281		-		21,989
			Net property and equipment		6		19,679		1,190		-		20,875
INTERCOMPANY RECEIVABLE					-		686		1,563		(2,249)		-
GOODWILL					-		1,552		2,258		-		3,810
INVESTMENT IN SUBSIDIARIES					23,173		3,800		-		(26,973)		-
OTHER ASSETS					2,752		898		477		(2,684)		1,443
				$	28,358	$	32,745	$	8,002	$	(32,036)	$	37,069
LIABILITIES AND STOCKHOLDERS' INVESTMENT
CURRENT LIABILITIES
	Current portion of long-term debt			$	-	$	7	$	12	$	-	$	19
	Accrued salaries and employee benefits				34		1,208		194		-		1,436
	Accounts payable				5		1,433		758		(130)		2,066
	Accrued expenses				604		1,557		275		-		2,436
		Total current liabilities			643		4,205		1,239		(130)		5,957
LONG-TERM DEBT, LESS CURRENT PORTION					6,978		248		23		-		7,249
INTERCOMPANY PAYABLE					2,249		-		-		(2,249)		-
OTHER LONG-TERM LIABILITIES
	Deferred income taxes				-		4,206		225		(2,684)		1,747
	Other liabilities				3,495		3,367		261		-		7,123
		Total other long-term liabilities			3,495		7,573		486		(2,684)		8,870
STOCKHOLDERS' INVESTMENT					14,993		20,719		6,254		(26,973)		14,993
				$	28,358	$	32,745	$	8,002	$	(32,036)	$	37,069

Condensed Consolidating Statements of Comprehensive Income

CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME
(UNAUDITED)
Three Months Ended August 31, 2015
				Guarantor		Non-guarantor
		Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
REVENUES		$	-	$	9,873	$	2,509	$	(103)	$	12,279
OPERATING EXPENSES:
	Salaries and employee benefits		34		3,813		678		-		4,525
	Purchased transportation		-		1,434		965		(55)		2,344
	Rentals and landing fees		1		587		108		(1)		695
	Depreciation and amortization		-		583		65		-		648
	Fuel		-		691		21		-		712
	Maintenance and repairs		-		508		40		-		548
	Intercompany charges, net		(69)		(40)		109		-		-
	Other		34		1,264		412		(47)		1,663
			-		8,840		2,398		(103)		11,135
OPERATING INCOME			-		1,033		111		-		1,144
OTHER INCOME (EXPENSE):
	Equity in earnings of subsidiaries		692		61		-		(753)		-
	Interest, net		(75)		8		4		-		(63)
	Intercompany charges, net		78		(76)		(2)		-		-
	Other, net		(3)		(3)		9		-		3
INCOME BEFORE INCOME TAXES			692		1,023		122		(753)		1,084
	Provision for income taxes		-		357		35		-		392
NET INCOME		$	692	$	666	$	87	$	(753)	$	692
COMPREHENSIVE INCOME		$	674	$	651	$	(42)	$	(753)	$	530
CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME
(UNAUDITED)
Three Months Ended August 31, 2014
(As Adjusted)
				Guarantor		Non-guarantor
		Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
REVENUES		$	-	$	9,769	$	2,004	$	(89)	$	11,684
OPERATING EXPENSES:
	Salaries and employee benefits		30		3,534		550		-		4,114
	Purchased transportation		-		1,386		711		(43)		2,054
	Rentals and landing fees		1		572		88		(1)		660
	Depreciation and amortization		-		595		56		-		651
	Fuel		-		1,095		25		-		1,120
	Maintenance and repairs		-		522		34		-		556
	Intercompany charges, net		(95)		2		93		-		-
	Other		64		1,165		283		(45)		1,467
			-		8,871		1,840		(89)		10,622
OPERATING INCOME			-		898		164		-		1,062
OTHER INCOME (EXPENSE):
	Equity in earnings of subsidiaries		653		98		-		(751)		-
	Interest, net		(53)		4		1		-		(48)
	Intercompany charges, net		54		(59)		5		-		-
	Other, net		(1)		(3)		2		-		(2)
INCOME BEFORE INCOME TAXES			653		938		172		(751)		1,012
	Provision for income taxes		-		296		63		-		359
NET INCOME		$	653	$	642	$	109	$	(751)	$	653
COMPREHENSIVE INCOME		$	636	$	638	$	83	$	(751)	$	606

Condensed Consolidating Statements of Cash Flows

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
(UNAUDITED)
Three Months Ended August 31, 2015
				Guarantor		Non-guarantor
		Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES		$	(397)	$	1,533	$	71	$	34	$	1,241
INVESTING ACTIVITIES
	Capital expenditures		-		(1,170)		(39)		-		(1,209)
	Proceeds from asset dispositions and other		(5)		15		-		-		10
CASH USED IN INVESTING ACTIVITIES			(5)		(1,155)		(39)		-		(1,199)
FINANCING ACTIVITIES
	Net transfers from (to) Parent		452		(479)		27		-		-
	Payment on loan between subsidiaries		-		98		(98)		-		-
	Intercompany dividends		-		4		(4)		-		-
	Principal payments on debt		-		(2)		(13)		-		(15)
	Proceeds from stock issuances		46		-		-		-		46
	Excess tax benefit on the exercise of stock options		6		-		-		-		6
	Dividends paid		(71)		-		-		-		(71)
	Purchase of treasury stock		(190)		-		-		-		(190)
	Other, net		-		(25)		25		-		-
CASH (USED IN) PROVIDED BY FINANCING ACTIVITIES			243		(404)		(63)		-		(224)
Effect of exchange rate changes on cash			-		(15)		(23)		-		(38)
Net (decrease) increase in cash and cash equivalents			(159)		(41)		(54)		34		(220)
Cash and cash equivalents at beginning of period			2,383		487		971		(78)		3,763
Cash and cash equivalents at end of period		$	2,224	$	446	$	917	$	(44)	$	3,543
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
(UNAUDITED)
Three Months Ended August 31, 2014
				Guarantor		Non-guarantor
		Parent		Subsidiaries		Subsidiaries		Eliminations		Consolidated
CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES		$	(67)	$	934	$	105	$	10	$	982
INVESTING ACTIVITIES
	Capital expenditures		(1)		(688)		(31)		-		(720)
	Proceeds from asset dispositions and other		-		7		(3)		-		4
CASH USED IN INVESTING ACTIVITIES			(1)		(681)		(34)		-		(716)
FINANCING ACTIVITIES
	Net transfers from (to) Parent		358		(366)		8		-		-
	Payment on loan between subsidiaries		-		103		(103)		-		-
	Intercompany dividends		-		2		(2)		-		-
	Proceeds from stock issuances		97		-		-		-		97
	Excess tax benefit on the exercise of stock options		10		-		-		-		10
	Dividends paid		(57)		-		-		-		(57)
	Purchase of treasury stock		(791)		-		-		-		(791)
	Other, net		-		(1)		1		-		-
CASH USED IN FINANCING ACTIVITIES			(383)		(262)		(96)		-		(741)
Effect of exchange rate changes on cash			-		(2)		(15)		-		(17)
Net (decrease) increase in cash and cash equivalents			(451)		(11)		(40)		10		(492)
Cash and cash equivalents at beginning of period			1,756		441		861		(150)		2,908
Cash and cash equivalents at end of period		$	1,305	$	430	$	821	$	(140)	$	2,416

XML

Condensed Consolidating Financial Statements (Details 1) $ in Millions	Aug. 31, 2015 USD ($)
Guarantor Obligations [Abstract]
Debt Guarantee	$ 7,000

XML

Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Millions	3 Months Ended
	Aug. 31, 2015	Aug. 31, 2014
Condensed Consolidated Statement of Other Comprehensive Income
NET INCOME	$ 692	$ 653
Other comprehensive income (loss):
Foreign currency translation adjustments, net of tax of $13 in 2015 and $9 in 2014	(138)	(31)
Amortization of prior service credit, net of tax of $7 in 2015 and $10 in 2014	(24)	(16)
Other comprehensive loss	(162)	(47)
COMPREHENSIVE INCOME	$ 530	$ 606

XML

Financing Arrangements

3 Months Ended

Aug. 31, 2015

Financing Arrangements [Abstract]

Financing Arrangements

(3)Financing Arrangements

In September 2015, we expect to file a new shelf registration statement with the SEC that will allow us to sell, in one or more future offerings, any combination of our unsecured debt securities and common stock.

A $1 billion revolving credit facility is available to finance our operations and other cash flow needs and to provide support for the issuance of commercial paper. The revolving credit agreement expires in March 2018. The agreement contains a financial covenant, which requires us to maintain a leverage ratio of adjusted debt (long-term debt, including the current portion of such debt, plus six times our last four fiscal quarters' rentals and landing fees) to capital (adjusted debt plus total common stockholders' investment) that does not exceed 70%. Our leverage ratio of adjusted debt to capital was61% at August 31, 2015. We believe the leverage ratio covenant is our only significant restrictive covenant in our revolving credit agreement. Our revolving credit agreement contains other customary covenants that do not, individually or in the aggregate, materially restrict the conduct of our business. We are in compliance with the leverage ratio covenant and all other covenants of our revolving credit agreement and do not expect the covenants to affect our operations, including our liquidity or expected funding needs. As of August 31, 2015, no commercial paper was outstanding, and the entire $1 billion under the revolving credit facility was available for future borrowings.

Long-term debt, exclusive of capital leases, hada carrying value of $7.2 billion at August 31, 2015andMay 31, 2015, compared with estimated fair values of $7.2 billion at August 31, 2015 and $7.4 billion at May 31, 2015.The estimated fair values were determined based on quoted market prices and the current rates offered for debt with similar terms and maturities. The fair value of our long-term debt is classified as Level 2 within the fair value hierarchy. This classification is defined asa fair value determined using market-based inputs other than quoted prices that are observable for the liability, either directly or indirectly.

XML

General (Details) $ / shares in Units, € in Millions, $ in Millions	3 Months Ended
	Aug. 31, 2015 USD ($) $ / shares shares	Aug. 31, 2014 USD ($)	Aug. 31, 2015 EUR (€) shares	May. 31, 2015 USD ($)
General Details [Abstract]
Dividends Payable, Date Declared	Aug. 14, 2015
Dividends Payable Amount Per Share | $ / shares	$ 0.25
Dividends Payable, Date To Be Paid	Oct. 01, 2015
Dividends Payable, Date Of Record	Sep. 10, 2015
Business Acquisition [Line Items]
Goodwill	$ 3,792			$ 3,810
Stock Based Compensation Details [Abstract]
Stock-based compensation	$ 53	$ 48
Treasury Shares [Abstract]
Number Of Shares Repurchased | shares	1,100,000		1,100,000
Treasury Stock Acquired, Average Cost Per Share | $ / shares	$ 172
Stock Repurchase Authorization, Number of Shares Authorized to Be Repurchased | shares	15,000,000		15,000,000
Stock Repurchase Authorization, Remaining Number of Shares | shares	11,100,000		11,100,000
Purchase of treasury stock	$ 190	$ 791
GENCOBONGOCOMBINED [Member]
Business Acquisition [Line Items]
Current Assets	350
Property and equipment	113
Goodwill	1,170
Intangible assets	139
Other non-current assets	25
Current liabilities	(245)
Long-term liabilities	(97)
Total purchase price	1,455
TNT acquisition [Member]
Business Acquisition [Line Items]
Business Acquisitions Conditional Acquisition Price | €			€ 4,400
TNT acquisiton USD [Member]
Business Acquisition [Line Items]
Business Acquisitions Conditional Acquisition Price	$ 5,000

XML

Commitments (Details 4) - Aug. 31, 2015 $ in Millions	USD ($)
Other Aircraft Commitments Disclosure [Abstract]
Boeing 777F Conditional Aircraft Commitments	9
Boeing 767F Conditional Aircraft Commitments	6
Boeing 767F Aircraft Purchases	50
Other Commitment Disclosures [Line Items]
Deposit and Progress Payments	$ 411
Required Pensions Contributions Remaining	$ 495

XML

Accumulated Other Comprehensive Income (Loss) (Tables)

3 Months Ended

Aug. 31, 2015

Accumulated Other Comprehensive Income (Loss) (Tables) [Abstract]

Schedule Of Accumulated Other Comprehensive Income (Loss)

		2015		2014
Foreign currency translation gain (loss):
	Balance at beginning of period	$	(253)	$	81
	Translation adjustments		(138)		(31)
	Balance at end of period		(391)		50
Retirement plans adjustments:
	Balance at beginning of period		425		425
	Reclassifications from AOCI		(24)		(16)
	Balance at end of period		401		409
Accumulated other comprehensive income at end of period		$	10	$	459

Reclassification Out Of Accumulated Other Comprehensive Income (Loss)

		Amount Reclassified from AOCI				Affected Line Item in the Income Statement
		2015		2014
	Amortization of retirement plans prior service credits	$	31	$	26	Salaries and employee benefits
	Income tax benefit		(7)		(10)	Provision for income taxes
AOCI reclassifications, net of tax		$	24	$	16	Net income