Document:

EXHIBIT 10.26

 

EXECUTION COPY

 

 

 

 

 TWENTY- FIFTH SUPPLEMENTAL LEASE AGREEMENT

 

by and between

 

MEMPHIS-SHELBY COUNTY AIRPORT AUTHORITY

 

 

and

 

FEDERAL EXPRESS CORPORATION

 

 

Dated as of April 1, 2005

 

 

AMENDING
THE CONSOLIDATED AND RESTATED LEASE AGREEMENT DATED AS OF AUGUST 1, 1979
BETWEEN THE MEMPHIS-SHELBY COUNTY AIRPORT AUTHORITY AND FEDERAL EXPRESS
CORPORATION.

 

 

 

 

TABLE OF CONTENTS

 

	
  Section

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  1

  	
   

  	
  Definitions

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  2

  	
   

  	
  Granting
  Leasehold 

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  3

  	
   

  	
  Term;
  Delivery and Acceptance of Possession 

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  4

  	
   

  	
  Rental
  

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  5

  	
   

  	
  Hazardous
  Substances/Waste

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  6

  	
   

  	
  Lease
  Agreement Still in Effect; Provisions There of Applicable to this
  Twenty-Fifth Supplemental Lease Agreement

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  7

  	
   

  	
  Descriptive
  Headings 

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  8

  	
   

  	
  Effectiveness
  of this Twenty-Fifth Lease Agreement  

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  9

  	
   

  	
  Execution
  of Counterparts

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  10

  	
   

  	
  Summaries

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Notary

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Leased
  Parcel Summary

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Rental Summary 

  	
   

  

 

 

TWENTY-FIFTH SUPPLEMENTAL LEASE AGREEMENT

 

THIS TWENTY-FIFTH SUPPLEMENTAL LEASE
AGREEMENT, made and entered into as of the 1st of
April 2005, by and between MEMPHIS-SHELBY COUNTY AIRPORT AUTHORITY (herein
sometimes referred to as “Authority”), a public and governmental body politic
and corporate of the State of Tennessee, and FEDERAL EXPRESS CORPORATION
(herein sometimes referred to as “Tenant”), a corporation duly organized and
existing under the laws of the State of Delaware and qualified to do business
in the State of Tennessee.

 

W I T N E S S E T H:

 

WHEREAS,
Authority and Tenant on October 3, 1979 entered into a Consolidated and
Restated Lease Agreement dated as of August 1, 1979; and

 

WHEREAS,
Authority and Tenant between April 1, 1981 and May 1, 2003, have entered into
Twenty Four Supplemental Lease Agreements amending the 1979 Consolidated and
Restated Lease Agreement; and

 

WHEREAS, the
said Consolidated and Restated Lease Agreement dated as of August 1, 1979,
together with the First through the Twenty-Fourth Supplemental Lease
Agreements, is herein referred to as the “Lease Agreement”; and

 

WHEREAS,
Authority and Tenant have agreed to further supplement the Lease Agreement so
as to lease to Tenant certain additional land under this Twenty-Fifth
Supplemental Lease Agreement.

 

NOW
THEREFORE, for and in consideration of the mutual promises, covenants and
agreements hereinafter contained to be kept and performed by the parties hereto
and upon the

 

3

 

provisions
and conditions hereinafter set forth, Authority and Tenant do hereby covenant
and agree, and each for itself does hereby covenant and agree, as follows:

 

SECTION 1.  Definitions.  Except
as otherwise provided herein, and unless the context shall clearly require
otherwise, all words and terms used in this Twenty–Fifth Supplemental Lease
Agreement which are defined in the Lease Agreement, shall, for all purposes of
this Twenty-Fifth Supplemental Lease Agreement, have the respective meanings
given to them in the Lease Agreement.

 

SECTION 2.  Granting of Leasehold.  In addition to the lease and demise to Tenant
of the land in the Lease Agreement, the Authority hereby leases and demises to
Tenant, and Tenant hereby takes and hires from Authority, subject to the
provisions and conditions set forth in the Lease Agreement and this
Twenty-Fifth Supplemental Lease Agreement, the additional land as follows:

 

•                  319,033 square feet or 7.324 acres to use for
GSE/ramp equipment storage and other aircraft support functions and for the
construction of a GSE repair and ramp support building.

 

•                  108,972 square feet or 2.502 acres for the
construction of two (2) wide-body aircraft gates.

 

SECTION 3.  Term; Delivery and Acceptance of Possession.  The
term of this Twenty-Fifth Supplemental Lease Agreement shall commence at 12:01
A.M. on April 1, 2005, for the land described in Exhibit “A” and shall expire
at such time as the Lease Agreement shall expire, to-wit:  August 31, 2012 or upon such earlier
termination, extension or otherwise as provided therein. Authority shall,
however, deliver to Tenant sole and exclusive possession of the land leased
hereby, as of the effective date of this Twenty-Fifth Supplemental Lease Agreement
for the purpose 

 

4

 

of
constructing improvements required for Tenant’s intended use of the land leased
hereby, subject however, to Authority’s right-of-entry set forth in Section 21
of the Lease Agreement.

 

SECTION 4.  Rental.  In
addition and supplemental to the rentals required to be paid to the Authority
pursuant to Section 5 of the Lease Agreement (including all prior Supplemental
Lease Agreements), during the term of this Twenty-Fifth Supplemental Lease
Agreement, Tenant shall pay to the Authority in advance on the first business
day of each month $5,439.23 in equal rental installments beginning date of
beneficial occupancy or December 31, 2008, whichever occurs first.

 

The
rental rate for all parcels will increase subject to terms and conditions of
the consolidated and restated lease agreement dated August 1, 1979.

 

SECTION 5. Hazardous Substances/Waste.  Tenant agrees to take the above parcels
included in this Supplement in an “as is” condition as it relates to Hazardous
Substances/Waste material that may be located at the site.

 

Tenant, at its
own expense, may arrange for a Phase I Environmental Survey on the land
described herein by a reputable environmental consultant to determine the
existence of “Hazardous Substances”, as such term is defined in this
Agreement.  In the event that “Hazardous
Substances” are discovered during excavation for construction on the property
described in Exhibit “A”, and those “Hazardous
Substances” require special handling, removal or disposal (“Remediation”), then
Tenant shall immediately notify Authority. 
The Tenant and Authority will confer and jointly determine the method of
handling, removing or disposing of the “Hazardous Substances” within 14 days
after Tenant provides the Authority, in writing, its plan for Remediation.  The form of Remediation agreed to by the
parties must comply with “Environmental Laws”, as such
term is defined below.  In the event that
Tenant and Authority are unable to agree on a method for handling, removing or
disposing of the “Hazardous Substances” due to differing interpretations of the

 

5

 

requirements
for Remediation as set forth in the applicable “Environmental Laws”, then the
form of Remediation will be determined by the appropriate federal, state or
local agency with relevant regulatory and enforcement jurisdiction over the
subject site.  Authority will grant to
Tenant a rent credit equal to the reasonable documented costs paid by Tenant
for the Remediation of such “Hazardous Substances” associated with the property
described in Exhibit “A”.

 

The term “Hazardous Substances”, as used in this
Twenty-Fifth Supplemental Lease Agreement, shall mean any hazardous or toxic
substances, materials or wastes, including, but not limited to, those
substances, materials, and wastes (i) listed in the United States Department of
Transportation Hazardous Materials Table (49 CFR § 172.101) or by the
Environmental Protection Agency as hazardous substances (40 CFR Part 302 and
amendments thereto), (ii) designated as a “Hazardous Substance” pursuant to
Section 311 of the Clean Water Act, 33 U.S.C. § 1251 et seq. (33 U.S.C. § 1321)
or listed pursuant to Section 307 of the Clean Water Act (33 U.S.C. § 1317),
(iii) defined as a “Hazardous Waste” pursuant to Section 1004 of the Resource
Conservation and Recovery Act, 42 U.S.C. § 6901, et seq. (42 U.S.C. § 6903), or
(iv) defined as “Hazardous Substance” pursuant to Section 101 of the
Comprehensive Environmental Response, Compensation and Liability Act, (42
U.S.C.§ 9601, et seq. 42 U.S.C. § 9601), or any other substances, (including,
without limitation, asbestos and raw materials which include hazardous
constituents), the general, discharge or removal of which or the use of which
is restricted, prohibited or penalized by any “Environmental Law”, which term
shall mean any Federal, State or local law, regulation, or ordinance relating
to pollution or protection of the environment.

 

SECTION 6.  Lease
Agreement Still in Effect; Provisions Therefore Applicable to this Supplemental
Lease Agreement.  All of
the terms, provisions, conditions, covenants and agreements of the Lease
Agreement, as supplemented, shall continue in full force and effect as 

 

6

 

supplemented
hereby, and shall be applicable to each of the provisions of this Twenty-Fifth
Supplemental Lease Agreement during the term hereof with the same force and
effect as though the provisions hereof were set forth in the Lease Agreement.

 

SECTION 7.  Descriptive Headings.  The
descriptive headings of the sections of this Twenty-Fifth Supplemental Lease
Agreement are inserted for convenience of reference only and do not constitute
a part of this Twenty-Fifth Supplemental Lease Agreement and shall not
affect  meaning, construction,
interpretation or effect of this Twenty-Fifth Supplemental Lease Agreement.

 

SECTION 8.  Effectiveness of this Supplemental Lease Agreement.  This
Twenty-Fifth Supplemental Lease Agreement shall become effective at 12:01 a.m.
on April 1, 2005.

 

SECTION 9.  Execution of Counterparts. This Twenty-Fifth Supplemental Lease
Agreement may be simultaneously executed in several counterparts, each of which
shall be an original and all of which shall constitute but one and the same
instrument.

 

SECTION 10.  Summaries.  For
the convenience of both parties a Leased Parcel Summary and a Rental Summary
are attached to this Lease Agreement.

 

7

 

IN
WITNESS WHEREOF, THE MEMPHIS-SHELBY COUNTY AIRPORT AUTHORITY AND FEDERAL
EXPRESS CORPORATION have caused this Twenty-Fifth  Supplemental Lease Agreement to be
duly executed in their respective behalfs, as of the day and year first above
written.

 

 

	
  WITNESS:

  	
   

  	
  MEMPHIS-SHELBY
  COUNTY AIRPORT

  
	
   

  	
   

  	
  AUTHORITY

  
	
   

  	
   

  	
   

  
	
  /s/ SCOTT A.
  BROCKMAN

  	
   

  	
   

  	
  BY:

  	
  /s/ LARRY D.
  COX

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  TITLE:

  	
  Executive VP, Finance and Administration

  	
   

  	
  TITLE:
  President

  
	
   

  	
   

  	
   

  
	
  Approved as
  to Form and Legality:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ R.
  GRATTAN BROWN, JR.

  	
   

  	
   

  
	
  R. Grattan
  Brown, Jr., Attorney

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  WITNESS:

  	
   

  	
  FEDERAL
  EXPRESS CORPORATION

  
	
   

  	
   

  	
  A Delaware
  Corporation

  
	
   

  	
   

  	
   

  
	
  /s/ MARILYN
  JONES

  	
   

  	
   

  	
  BY:

  	
  /s/ WILEY
  JOHNSON, JR.

  
	
   

  	
   

  	
   

  	
   

  
	
  TITLE:
  Project Coordinator

  	
   

  	
  TITLE:
  

  	
  Managing Director, Real Estate and 

  Airport Development

  
								

 

8

 

(STATE OF TENNESSEE)

(COUNTY OF SHELBY)

 

On
this 27th day of May, 2005 before me appeared Larry Cox, to me personally
known, who, being by me duly sworn (or affirmed), did say that he is the
President of the Memphis-Shelby County Airport Authority, the within named
Lessor, and that he as such President, being authorized so to do, executed the
foregoing instrument for the purposes therein contained, by signing the name of
the Authority by himself as such President.

 

MY COMMISSION EXPIRES

 

	
  April
  16, 2008

  	
  /s/
  ANGELA M. WASHINGTON

  	
   

  
	
   

  	
  Notary
  Public

  	
   

  
	
   

  	
   

  
	
  (seal)

  	
   

  

 

 

(STATE OF TENNESSEE)

(COUNTY OF SHELBY)

 

On
this 16th day of May, 2005 before me appeared Wiley Johnson, Jr., to me
personally known, who, being by me duly sworn (or affirmed), did say that he is
a Managing Director, Real Estate, of Federal Express Corporation, the within
named Lessee, and that he as such Managing Director, Real Estate, being
authorized so to do, executed the foregoing instrument for the purposes therein
contained, by signing the name of the Corporation by himself as such Managing
Director, Real Estate.

 

	
  MY
  COMMISSION EXPIRES

  	
   

  
	
   

  	
   

  
	
  September
  19, 2007

  	
  /s/
  MARILYN JONES

  	
   

  
	
   

  	
  Notary
  Public

  	
   

  
	
   

  	
   

  
	
  (seal)

  	
   

  

 

9

 

FEDERAL
EXPRESS LEASED PARCELS SUMMARY

 

	
  PARCEL

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  EFFECTIVE

  	
   

  
	
  LEASE

  	
   

  	
  ACRES

  	
   

  	
  SQUARE
  FEET

  	
   

  	
  AGREEMENT

  	
   

  	
  DATE

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  BASE-LEASE

  	
   

  
	
  Revised 9

  	
   

  	
  128.469

  	
   

  	
   

  	
   

  	
  Consolidated &
  Restated

  	
   

  	
  08/01/79

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  10

  	
   

  	
  1.612

  	
   

  	
  70,200

  	
   

  	
  Consolidated &
  Restated

  	
   

  	
  08/01/79

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  11

  	
   

  	
  1.044

  	
   

  	
  45,359

  	
   

  	
  Consolidated &
  Restated

  	
   

  	
  08/01/79

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  PREVIOUS SUPPLEMENTS

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  12

  	
   

  	
  2.707

  	
   

  	
  117,915

  	
   

  	
  First Supplemental

  	
   

  	
  04/01/81

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  13

  	
   

  	
  6.860

  	
   

  	
  298,830

  	
   

  	
  Second Supplemental

  	
   

  	
  01/01/82

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  14

  	
   

  	
  14.586

  	
   

  	
  635,377

  	
   

  	
  Fourth Supplemental

  	
   

  	
  07/01/83

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  15

  	
   

  	
  12.689

  	
   

  	
  552,723

  	
   

  	
  Fourth Supplemental

  	
   

  	
  07/01/83

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Rev 16

  	
   

  	
  18.281
  (19.685

  	
  )

  	
  796,312

  	
   

  	
  Fifth Supplemental

  	
   

  	
  02/01/84

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Rev 17

  	
   

  	
  119.616
  (124.992

  	
  )

  	
  5,210,477

  	
   

  	
  Sixth Supplemental

  	
   

  	
  04/01/84

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  18

  	
   

  	
  2.717

  	
   

  	
  118,353

  	
   

  	
  Sixth Supplemental

  	
   

  	
  04/01/84

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  19

  	
   

  	
  41.606

  	
   

  	
  1,812,352

  	
   

  	
  Seventh Supplemental

  	
   

  	
  06/01/84

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  25

  	
   

  	
  0.435

  	
   

  	
  18,933

  	
   

  	
  Eighth Supplemental

  	
   

  	
  07/01/88

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  20

  	
   

  	
  11.275

  	
   

  	
  491,127

  	
   

  	
  Ninth Supplemental

  	
   

  	
  06/01/89

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  27

  	
   

  	
  11.192

  	
   

  	
  487,512

  	
   

  	
  Tenth Supplemental

  	
   

  	
  10/01/91

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  27 A (West)

  	
   

  	
  4.058

  	
   

  	
  176,777

  	
   

  	
  Eleventh Supplemental

  	
   

  	
  07/01/94

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  27 B (West)

  	
   

  	
  5.706

  	
   

  	
  248,533

  	
   

  	
  Eleventh Supplemental

  	
   

  	
  07/01/94

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Southwest Ramp

  	
   

  	
  2.350

  	
   

  	
  102,366

  	
   

  	
  Eleventh Supplemental

  	
   

  	
  07/01/94

  	
   

  

 

10

 

	
  PARCEL

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  EFFECTIVE

  	
   

  
	
  LEASE

  	
   

  	
  ACRES

  	
   

  	
  SQUARE
  FEET

  	
   

  	
  AGREEMENT

  	
   

  	
  DATE

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  32 (removed)

  	
   

  	
  22.972

  	
   

  	
  1,000,681

  	
   

  	
  Twelfth Supplemental

  	
   

  	
  07/01/93

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  33

  	
   

  	
  8.998

  	
   

  	
  391,942

  	
   

  	
  Thirteenth Supplemental

  	
   

  	
  06/01/95

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  36

  	
   

  	
  3.050

  	
   

  	
  132,837

  	
   

  	
  Thirteenth Supplemental

  	
   

  	
  06/01/95

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Hangar 8 (removed)

  	
   

  	
   

  	
   

  	
  36,946.33

  	
   

  	
  Thirteenth Supplemental

  	
   

  	
  06/01/95

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  34

  	
   

  	
  9.951

  	
   

  	
  433,461

  	
   

  	
  Fourteenth Supplemental

  	
   

  	
  01/01/96

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  21

  	
   

  	
  19.134

  	
   

  	
  833,476

  	
   

  	
  Fifteenth Supplemental

  	
   

  	
  01/01/97

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  22A (North)

  	
   

  	
  3.214

  	
   

  	
  140,000

  	
   

  	
  Sixteenth Supplemental

  	
   

  	
  04/01/97

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  37

  	
   

  	
  2.692

  	
   

  	
  117,283

  	
   

  	
  Seventeenth Supplemental

  	
   

  	
  05/01/97

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  38

  	
   

  	
  2.523

  	
   

  	
  109,921

  	
   

  	
  Eighteenth Supplemental

  	
   

  	
  07/01/97

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  39

  	
   

  	
  8.366

  	
   

  	
  364,430

  	
   

  	
  Eighteenth Supplemental

  	
   

  	
  07/01/97

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  West Ramp Expansion

  	
   

  	
  19.917

  	
   

  	
  867,583

  	
   

  	
  Nineteenth Expansion

  	
   

  	
  09/01/98

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Centerline November

  	
   

  	
  13.206

  	
   

  	
  575,253.36

  	
   

  	
  Twentieth Supplemental

  	
   

  	
  12/01/00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Taxilane 700

  	
   

  	
  4.706

  	
   

  	
  204,975

  	
   

  	
  Twenty-First Supplemental

  	
   

  	
  05/15/00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Taxilane 700 Extension

  	
   

  	
  3.052

  	
   

  	
  132,951

  	
   

  	
  Twenty-Second Supplemental

  	
   

  	
  03/15/01

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  West Ramp Aircraft/GSE
  Expansion

  	
   

  	
  8.408

  	
   

  	
  366,242

  	
   

  	
  Twenty-Second Supplemental

  	
   

  	
  03/15/01

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  23 (Graber)

  	
   

  	
  6.0023

  	
   

  	
  261,460.18

  	
   

  	
  Twenty-Third Supplemental

  	
   

  	
  03/01/02

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  12/02 West Ramp

  	
   

  	
  19.66

  	
   

  	
  856,529

  	
   

  	
   

  	
   

  	
  12/01/02

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  A380 Ramp

  	
   

  	
  43.6181

  	
   

  	
  1,900,006

  	
   

  	
   

  	
   

  	
  12/31/06

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  West Ramp Expansion (A)

  	
   

  	
  4.089

  	
   

  	
  178,097

  	
   

  	
  Twenty-Fourth Supplement

  	
   

  	
  05/01/03

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  THIS SUPPLEMENT

  	
   

  
	
  GSE Ramp equipment storage

  	
   

  	
  7.324

  	
   

  	
  319,033

  	
   

  	
  Twenty-Fifth Supplement

  	
   

  	
  04/01/05

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Construction of aircraft gates

  	
   

  	
  2.502

  	
   

  	
  108,972

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

11

 

OPTIONS

 

	
  22B (South)

  	
   

  	
  3.310

  	
   

  	
  144,200

  	
   

  	
  Option, Expires 5/31/04

  	
   

  
	
  29

  	
   

  	
  3.85

  	
   

  	
  167,706

  	
   

  	
  Option, Month/Month

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

ASSIGNMENTS

 

	
  24

  	
   

  	
  9.964

  	
   

  	
  434,030

  	
   

  	
  Southwide Assignment

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Expires 5/14/2013

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Invoice FEC

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Next Increase 5/15/03

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  26

  	
   

  	
  9.532

  	
   

  	
  415,213

  	
   

  	
  BICO Assignment,

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Expires 7/31/2021

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Invoice FEC

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Next Increase 8/01/2011

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  28

  	
   

  	
  10.68

  	
   

  	
  465,221

  	
   

  	
  Equitable Life Assignment

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Expires 5/14/2013

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Invoice FEC

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Next Increase 5/15/03

  	
   

  

 

RENTAL - FEDERAL EXPRESS

 

	
  Category

  Of Space

  	
   

  	
  Number of

  Square Feet

  	
   

  	
  Annual

  Rental Rate

  Per Sq. Ft.

  	
   

  	
  Annual Rental

  	
   

  
	
  Parcel 23 (Graber)

  	
   

  	
  261,460.18

  	
   

  	
  0.0823

  	
   

  	
  $

  	
  21,518.17

  	
   

  
	
  Bldg. T-376

  	
   

  	
  1,240.00

  	
   

  	
  1.9072

  	
   

  	
  $

  	
  2,364.93

  	
   

  
	
  Unimproved Ground

  	
   

  	
  9,475,459.36

  	
   

  	
  0.1525

  	
   

  	
  $

  	
  1,445,007.55

  	
   

  
	
  Improved Apron

  	
   

  	
  2,395,802.00

  	
   

  	
  0.1906

  	
   

  	
  $

  	
  456,639.86

  	
   

  
	
  Hangar Property

  	
   

  	
  72,092.67

  	
   

  	
  1.4113

  	
   

  	
  $

  	
  101,744.39

  	
   

  
	
  Hangar Office

  	
   

  	
  28,000.00

  	
   

  	
  2.2889

  	
   

  	
  $

  	
  64,089.20

  	
   

  
	
  International Park

  	
   

  	
  9,694,700.00

  	
   

  	
  0.2672

  	
   

  	
  $

  	
  2,590,423.84

  	
   

  
	
  Former IRS Facility

  	
   

  	
  2,255,137.24

  	
   

  	
  —

  	
   

  	
  $

  	
  1,200,000.00

  	
   

  
	
   

  	
   

  	
  24,183,891.45

  	
   

  	
  6.3

  	
   

  	
  $

  	
  5,881,787.94

  	
   

  

 

BREAKDOWN OF SPACE

 

	
   

  	
   

  	
   

  	
   

  	
  Sq. Ft.

  	
   

  	
  Sq. Ft.

  	
   

  
	
  Graber

  	
   

  	
  Parcel 23

  	
   

  	
  261,460.18

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  261,460.18

  	
   

  
	
  Bldg. T-376

  	
   

  	
  Parcel 4

  	
   

  	
  1,240

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  1,240

  	
   

  
	
  Unimproved Ground

  	
   

  	
  Parcel 1

  	
   

  	
  130,900

  	
   

  	
   

  	
   

  

 

12

 

	
   

  	
   

  	
  Parcel 2

  	
   

  	
  50,000

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Parcel 3

  	
   

  	
  192,400

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Parcel 4

  	
   

  	
  32,540

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Parcel 6

  	
   

  	
  89,700

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Parcel 9

  	
   

  	
  1,167,337

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Parcel 19

  	
   

  	
  1,812,362

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Parcel 20

  	
   

  	
  491,127

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Parcel 27A

  	
   

  	
  176,777

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Parcel 27B

  	
   

  	
  248,533

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Southwest Ramp

  	
   

  	
  102,366

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Parcel 33

  	
   

  	
  391,942

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Parcel 36

  	
   

  	
  132,837

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Parcel 34

  	
   

  	
  433,461

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Parcel 37

  	
   

  	
  117,283

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Parcel 38

  	
   

  	
  109,921

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Parcel 39

  	
   

  	
  364,430

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  West Ramp Expansion

  	
   

  	
  867,588

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Centerline November

  	
   

  	
  575,253.36

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Taxilane 700

  	
   

  	
  204,975

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Taxilane 700 Extension

  	
   

  	
  132,951

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  West Ramp Aircraft/GSE Expansion

  	
   

  	
  366,242

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  12/02 West Ramp Expansion

  	
   

  	
  856,529

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  MEM A380 Ramp

  	
   

  	
  319,033

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Lease Parcel

  	
   

  	
  108,972

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  9,475,459.36

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Improved Apron

  	
   

  	
  Parcel 1

  	
   

  	
  850,250

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Parcel 2

  	
   

  	
  226,900

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Parcel 7

  	
   

  	
  577,540

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Parcel 9

  	
   

  	
  253,600

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Parcel 27

  	
   

  	
  487,512

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  2,395,802.00

  	
   

  

 

	
   

  	
   

  	
   

  	
   

  	
  Sq. Ft.

  	
   

  	
  Sq. Ft.

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Hangar Property

  	
   

  	
  Parcel 1

  	
   

  	
  44,336

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Parcel 2

  	
   

  	
  27,756.67

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  72,092.67

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Hangar Office

  	
   

  	
  Parcel 1

  	
   

  	
  22,400

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Parcel 2

  	
   

  	
  5,600

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  28,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International
  Park

  	
   

  	
  Parcel 5

  	
   

  	
  24,000

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Parcel 8

  	
   

  	
  247,254

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Parcel 9

  	
   

  	
  1,586,172

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Parcel 10

  	
   

  	
  70,200

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Parcel 11

  	
   

  	
  45,359

  	
   

  	
   

  	
   

  

 

13

 

	
   

  	
   

  	
  Parcel 12

  	
   

  	
  117,915

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Parcel 13

  	
   

  	
  298,830

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Parcel 14

  	
   

  	
  556,334

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Parcel 15

  	
   

  	
  552,723

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Parcel 16

  	
   

  	
  796,312

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Parcel 17

  	
   

  	
  4,288,839

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Parcel 18

  	
   

  	
  118,353

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Parcel 25

  	
   

  	
  18,933

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Parcel 21

  	
   

  	
  833,476

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Parcel 22A

  	
   

  	
  140,000

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  9,694,700.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Former IRS Facility

  	
   

  	
   

  	
   

  	
  2,255,137.24

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  2,255,137.24

  	
   

  

 

	
  Areas added DBO

  	
   

  	
  Square feet

  	
   

  	
  DBO

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  West Ramp Expansion (A)

  	
   

  	
  178,097

  	
   

  	
  12/31/03

  	
   

  	
   

  	
   

  
	
  A380 Ramp

  	
   

  	
  1,900,006

  	
   

  	
  12/31/06

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  2,078,103

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL:

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  26,261,994.45

  	
   

  

 

14

 

Exhibit “A”

 

MEM A380 RAMP

ADDITIONAL TO PARCEL A380 RAMP LEASE AREA

 

Being a 7.32 acre parcel of
land contained entirely within the Memphis-Shelby County Airport Authority
(MSCAA) property located in the City of Memphis, Shelby County, State of Tennessee. 
Said parcel is located on the north side of Winchester Road, east side
of the Fed-Ex lease area known as Parcel A380 Ramp, south of AOC Road, and west
of the MSCAA Maintenance Facility and being more particularly described by
metes and bounds as follows:

 

Beginning at the southeast
corner of the Parcel A380 Ramp area described in the “Twenty-Third Supplemental
Lease Agreement” by and between MSCAA and the Federal Express Corporation dated
as of March 1, 2002, said point being on the existing north right-of-way
(R.O.W.) of Winchester Road (99 feed wide); thence along the east line of said
existing lease area North 02° 54’36” East, 965.44 feet to a point; thence
continuing along said east line North 44° 04’43” West, 232.92 feet to a point,
said point being the intersection of said east line with the proposed south
edge of AOC Road; thence along said AOC Road south edge South 82° 39’19” East, 190.62 feet to a point;
thence continuing along with AOC Road south edge South 89° 01’31” East, 162.34
feet to a point of tangent-curve; thence continuing along said AOC Road south
edge along a curve to the left having a radius of 986.00 feet and an arc length
of 208.75 feet (chord = North 84° 54’34” East, 208.36 feet) to a point, said
point being the northeast corner of this proposed lease area; thence South 04°
20’49” West, 237.72 feet to a point; thence South 49° 14’57” West, 234.28 feet
to a point; thence South 40° 36’14” East, 70.25 feet to a point; thence South
04° 00’42” West, 57.07 feet to a point; thence South 45° 51’09” West, 39.87
feet to a point, thence South 04° 04’09” West, 155.08 feet to a point; thence
North 85° 54’53” West, 108.32 feet to a point; thence South 04° 05’07” West,
292.49 feet to a point on the north right-of-way of Winchester Road; thence
along the said north R.O.W. North 85° 48’20” West, 295.48 feet of the POINT OF
BEGINNING.

 

Said parcel of land and
containing by 319,033 square feet or 7.324 acres, more or less.

 

15

 

[Survey]

 

16

 

Lease Parcel

 

Being a parcel of land
contained entirely within the Memphis/Shelby County Airport Authority property
located in the City of Memphis, Shelby County, State
of Tennessee being more particularly described by metes and bounds as follows:

 

Commencing at the centerline
intersection of Taxiway Zulu and Taxiway Charlie, thence along the centerline
of said Taxiway Charlie, North 01 degrees 56 minutes 39 seconds East, a
distance of 2,217.48 feet to a point; thence departing from said centerline,
along a line perpendicular to said centerline, North 88 degrees 03 minutes 21
seconds West, a distance of 160.00 feet to the POINT OF BEGINNING; thence North
88 degrees 03 minutes 21 seconds West, a distance of 93.25’ to a point; thence
South 01 degree 56 minutes 39 seconds West, a distance of 54.49’ to a point;
thence North 88 degrees 03 minutes 21 seconds West, a distance of 266.00’ to a
point; thence South 01 degree 56 minutes 39 seconds West, a distance of 75.00’
to a point, thence North 88 degrees 03 minutes 21 seconds West, a distance of
65.13’ to a point; thence North 01 degree 56 minutes 39 seconds East, a
distance of 19.36’ to a point; thence 88 degrees 03 minutes 21 seconds West, a
distance of 20.00’ to a point; thence North 01 degree 56 minutes 39 seconds
East, a distance of 40.00’ to a point; thence North 88 degrees 03 minutes 21
seconds West, a distance of 20.00’ to a point; thence North 01 degree 56
minutes 39 seconds East, a distance of 140.00 to a point; thence North 88
degrees 03 minutes 21 seconds West, a distance of 20.00’ to a point; thence
North 01 degree 56 minutes 39 seconds East, a distance of 103.21’ to a point;
thence South 88 degrees 03 minutes 21 seconds East, a distance of 484.38’ to a
point; thence along a line 160 feet west of and parallel with said centerline
of Taxiway Charlie, South 01 degree 56 minutes 39 seconds West, a distance of
173.08 to the POINT OF BEGINNING.

 

The above described Lease
Parcel contains 108,972 square feet, or 2.502 Acres, more or less.

 

17Exhibit 10.81

 

Compensation Arrangements with Executive
Officers

 

Base Salaries of Named Executive Officers

 

The following table sets forth the fiscal 2006 annual base salaries of
FedEx’s named executive officers, other than Kenneth R. Masterson, who retired
as FedEx’s Executive Vice President, General Counsel and Secretary effective
June 1, 2005:

 

	
  Name
  and

  Current Position

  	
   

  	
  Base Salary

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Frederick W. Smith

  	
   

  	
  $

  	
  1,325,988

  	
   

  
	
  Chairman,
  President and

  	
   

  	
   

  	
   

  
	
  Chief
  Executive Officer

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  David J. Bronczek

  	
   

  	
  $

  	
  880,068

  	
   

  
	
  President
  and Chief Executive Officer –

  	
   

  	
   

  	
   

  
	
  FedEx
  Express

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Alan B. Graf, Jr.

  	
   

  	
  $

  	
  780,336

  	
   

  
	
  Executive
  Vice President and

  	
   

  	
   

  	
   

  
	
  Chief
  Financial Officer

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  T. Michael Glenn

  	
   

  	
  $

  	
  727,032

  	
   

  
	
  Executive
  Vice President,

  	
   

  	
   

  	
   

  
	
  Market Development
  and

  	
   

  	
   

  	
   

  
	
  Corporate
  Communications

  	
   

  	
   

  	
   

  

 

Mr. Smith’s fiscal 2006 base salary is
effective as of July 16, 2005.  The
fiscal 2006 base salaries of the other named executive officers are effective
as of July 1, 2005.

 

FY2006 Annual Incentive Compensation
Plans

 

Chairman, President
and Chief Executive Officer

 

Frederick W. Smith’s fiscal 2006 annual bonus will be determined by the
achievement of corporate objectives for consolidated pre-tax income for fiscal
2006.  The Compensation Committee can
adjust Mr. Smith’s bonus amount upward or downward based on its consideration
of several factors, including: FedEx’s stock price performance relative to the
Standard & Poor’s 500 Composite Index, the Dow Jones Transportation Average
and the Dow Jones Industrial Average; FedEx’s revenue and operating income
growth relative to competitors; FedEx’s cash flow; FedEx’s return on invested
capital; FedEx’s U.S. revenue market share; FedEx’s reputation rankings by
various publications and surveys; and the Compensation Committee’s assessment
of the quality and effectiveness of Mr. Smith’s leadership during FY2006.  None of these factors will be given any
particular weight by the Compensation Committee in determining whether to
adjust Mr. Smith’s

 

 

bonus amount.  Mr. Smith’s annual bonus target for fiscal
2006 is 130% of his base salary, with a maximum payout of 300% of his base
salary.

 

Mr. Smith’s target annual bonus, combined
with his base salary, has a 75th percentile target for total annual
salary and bonus for chief executive officers in executive compensation surveys
utilized by the Compensation Committee.

 

Non-CEO Executive Officers

 

FedEx Corporation executive vice presidents
participate in the fiscal 2006 annual incentive cash bonus plan for
headquarters employees.  Under this plan,
the annual bonus target for each executive is 90% of his or her base salary,
with a maximum payout of 240% of base salary. 
A threshold payout of up to 30% of the target bonus is based on the
achievement of individual objectives established at the beginning of the fiscal
year for each executive.  Mr. Smith will
determine the achievement level of each executive’s individual objectives at
the conclusion of fiscal 2006.  The
balance of the bonus payout is based on FedEx’s consolidated pre-tax income for
fiscal 2006 and ranges, on a sliding scale, from a minimum amount if the plan’s
pre-established consolidated pre-tax income threshold is achieved up to a
maximum amount if such financial performance goal is substantially exceeded.

 

Each of the presidents of FedEx Express,
FedEx Ground, FedEx Freight and FedEx Kinko’s participate in the fiscal 2006
annual incentive cash bonus plan sponsored by his respective company.  The target annual bonus for the president of
FedEx Express is 100% of his base salary, with a maximum payout of 240% of his
base salary.  The target annual bonus for
the president of each of FedEx Ground, FedEx Freight and FedEx Kinko’s is 80%
of base salary, with a maximum payout of 240% of base salary.  Under each of these plans, a threshold payout
of up to 30% of the target bonus is based on the achievement of individual
objectives established at the beginning of the fiscal year for each
executive.  Mr. Smith will determine the
achievement level of each executive’s individual objectives at the conclusion
of fiscal 2006.  The balance of the
payout under each of the plans is based on each respective subsidiary’s
operating income (30% of the target bonus) and FedEx’s consolidated pre-tax
income (40% of the target bonus) for fiscal 2006 and ranges, on a sliding
scale, from a minimum amount if the plan’s pre-established subsidiary operating
income and FedEx’s consolidated pre-tax income thresholds are achieved up to a
maximum amount if such financial performance goals are substantially exceeded.

 

Total annual salary and bonus for these
executive officers for fiscal 2006 (assuming achievement of all individual and
corporate objectives as described above) is targeted at the 75th
percentile of total annual salary and bonus for comparable positions in the
comparison surveys utilized by the Compensation Committee.

 

Long-Term Incentive
Cash Bonus Program

 

The Compensation Committee has established
long-term performance bonus plans for the three-fiscal-year periods 2004
through 2006, 2005 through 2007 and 2006 through 2008, providing bonus
opportunities to members of upper management, including executive officers, for
fiscal 2006, 2007 and 2008, respectively, if certain aggregate
earnings-per-share goals established by the Compensation Committee are achieved
with respect to those periods.  No
amounts can be earned 

 

2

 

for the fiscal 2004 through 2006, 2005 through 2007 and 2006 through
2008 plans until 2006, 2007 and 2008, respectively, because achievement of the
earnings-per-share goals can only be determined following the conclusion of the
applicable three-fiscal-year period.

 

The following table sets forth estimates of
the possible future payouts to each of FedEx’s named executive officers.  Mr. Masterson, who retired effective June 1,
2005, is eligible for bonuses under the fiscal 2004 through 2006 and 2005
through 2007 plans based on the proportion of the applicable three-fiscal-year
period during which he was employed.

 

	
   

  	
   

  	
   

  	
   

  	
  Estimated Future Payouts

  	
   

  
	
  Name

  	
   

  	
  Performance 

  Period

  	
   

  	
  Threshold 

  ($)

  	
   

  	
  Target 

  ($)

  	
   

  	
  Maximum 

  ($)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Frederick W. Smith

  	
   

  	
  FY2004 – FY2006

  	
   

  	
  562,500

  	
   

  	
  2,250,000

  	
   

  	
  3,375,000

  	
   

  
	
   

  	
   

  	
  FY2005 – FY2007

  	
   

  	
  562,500

  	
   

  	
  2,250,000

  	
   

  	
  3,375,000

  	
   

  
	
   

  	
   

  	
  FY2006 – FY2008

  	
   

  	
  625,000

  	
   

  	
  2,500,000

  	
   

  	
  3,750,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  David J. Bronczek

  	
   

  	
  FY2004 – FY2006

  	
   

  	
  250,000

  	
   

  	
  1,000,000

  	
   

  	
  1,500,000

  	
   

  
	
   

  	
   

  	
  FY2005 – FY2007

  	
   

  	
  250,000

  	
   

  	
  1,000,000

  	
   

  	
  1,500,000

  	
   

  
	
   

  	
   

  	
  FY2006 – FY2008

  	
   

  	
  250,000

  	
   

  	
  1,000,000

  	
   

  	
  1,500,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Kenneth R. Masterson

  	
   

  	
  FY2004 – FY2006

  	
   

  	
  125,000

  	
   

  	
  500,000

  	
   

  	
  750,000

  	
   

  
	
   

  	
   

  	
  FY2005 – FY2007

  	
   

  	
  62,500

  	
   

  	
  250,000

  	
   

  	
  375,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Alan B. Graf, Jr.

  	
   

  	
  FY2004 – FY2006

  	
   

  	
  187,500

  	
   

  	
  750,000

  	
   

  	
  1,125,000

  	
   

  
	
   

  	
   

  	
  FY2005 – FY2007

  	
   

  	
  187,500

  	
   

  	
  750,000

  	
   

  	
  1,125,000

  	
   

  
	
   

  	
   

  	
  FY2006 – FY2008

  	
   

  	
  187,500

  	
   

  	
  750,000

  	
   

  	
  1,125,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  T. Michael Glenn

  	
   

  	
  FY2004 – FY2006

  	
   

  	
  187,500

  	
   

  	
  750,000

  	
   

  	
  1,125,000

  	
   

  
	
   

  	
   

  	
  FY2005 – FY2007

  	
   

  	
  187,500

  	
   

  	
  750,000

  	
   

  	
  1,125,000

  	
   

  
	
   

  	
   

  	
  FY2006 – FY2008

  	
   

  	
  187,500

  	
   

  	
  750,000

  	
   

  	
  1,125,000

  	
   

  

 

The estimated individual future payouts set
forth in the table above are set dollar amounts ranging from threshold amounts,
if the earnings-per-share goal achieved is less than target, up to maximum
amounts, if the plan goal is substantially exceeded.  There can be no assurance that the estimated
future payouts shown in this table will be achieved.

 

Other Arrangements

 

FedEx executive officers are eligible to
receive certain perquisites offered by FedEx, including financial counseling
and tax preparation services, personal use of corporate aircraft, club
memberships, and personal security and other services, including home security
systems and monitoring.

 

Executive officers also receive tax
reimbursement payments relating to restricted stock awards and certain
perquisites.

 

3

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