<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2)
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3)
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4)
and 0-11
1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11:*
------------------------------------------------------------------------
4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
* Set forth the amount on which the filing fee is calculated and state how it
was determined.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
------------------------------------------------------------------------
2) Form, Schedule or Registration Statement No.:
------------------------------------------------------------------------
3) Filing Party:
------------------------------------------------------------------------
4) Date Filed:
------------------------------------------------------------------------
<PAGE>
FEDERAL EXPRESS CORPORATION
2005 CORPORATE AVENUE
MEMPHIS, TENNESSEE 38132
---------------------------------------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD SEPTEMBER 26, 1994
----------------------------------------------------
To the Stockholders of Federal Express Corporation:
Notice is hereby given that the Annual Meeting of Stockholders of Federal
Express Corporation (the "Corporation") will be held at The Peabody Hotel, 149
Union Avenue, Memphis, Tennessee, on Monday, September 26, 1994 at 10:00 a.m.,
Central Daylight Time, for the following purposes:
1. To elect the Class II Directors to serve for the next three years;
2. To approve an amendment to the Corporation's Restated Certificate
of Incorporation to increase the number of authorized shares of
the Corporation's Common Stock;
3. To ratify the designation of Arthur Andersen & Co. as independent
auditors of the Corporation for fiscal 1995; and
4. To transact such other business as may properly come before the
meeting or any adjournment thereof.
Only stockholders of record at the close of business on July 29, 1994 will be
entitled to notice of, and to vote at, the meeting or any adjournment thereof.
By order of the Board Directors,
/s/ KENNETH R. MASTERSON
KENNETH R. MASTERSON
SECRETARY
August 4, 1994
IMPORTANT
PLEASE COMPLETE, DATE, SIGN AND RETURN THE ACCOMPANYING PROXY WHETHER OR NOT YOU
PLAN TO ATTEND THE MEETING. THE ENCLOSED RETURN ENVELOPE REQUIRES NO ADDITIONAL
POSTAGE IF MAILED IN THE UNITED STATES OR CANADA, AS APPLICABLE.
<PAGE>
---------------------
PROXY STATEMENT
-----------------------
This Proxy Statement is furnished in connection with the solicitation of proxies
by the Board of Directors of Federal Express Corporation (the "Corporation").
Shares represented at the meeting by the enclosed form of proxy will be voted by
Mr. William J. Razzouk, Executive Vice President -- Worldwide Customer
Operations, and Mr. Kenneth R. Masterson, Senior Vice President, General Counsel
and Secretary, in accordance with the directions noted thereon. If no direction
is given, the shares will be voted FOR election of the Class II Directors and
FOR proposals 2 and 3.
A stockholder giving a proxy may revoke it before it is voted by giving written
notice of such revocation to the Secretary of the Corporation or by executing a
later dated proxy. Attendance at the meeting by a stockholder who has given a
proxy will not have the effect of revoking it unless the stockholder gives such
written notice of revocation to the Secretary before the proxy is voted.
In recognition of the importance of confidential voting to many of the
Corporation's stockholders, the Board of Directors adopted a confidential voting
policy in December 1993. The policy provides that stockholder proxies, ballots
and voting materials that identify the votes of specific stockholders will be
kept confidential, except (i) as required by law, including in connection with
the pursuit or defense of legal or regulatory actions or proceedings; (ii) in
the event a stockholder expressly requests disclosure; or (iii) during a
contested election for the Board of Directors. In addition, the policy states
that the tabulators and inspectors of election, who may be the Corporation's
transfer agent or its employees, shall be independent and not the employees of
the Corporation.
As in the past, the Corporation's transfer agent, The First National Bank of
Chicago, will tabulate the votes, and an employee of the transfer agent will
serve as inspector of election. Proxies will be returned in envelopes addressed
to the transfer agent and, except in the limited circumstances specified above,
will not be seen by or reported to the Corporation.
The Definitive Proxy Statement and accompanying form of proxy will be first sent
or given to stockholders on or about August 15, 1994.
The cost of solicitation of proxies will be borne by the Corporation. In
addition to the solicitation of proxies by use of the mail and the Corporation's
internal mail system, proxies may be solicited by directors, officers and
regularly engaged employees of the Corporation. Brokers, nominees and other
similar record holders will be requested to forward solicitation material and
will be reimbursed by the Corporation upon request for their out-of-pocket
expenses. The Corporation has retained Morrow & Co., Inc. to assist in the
solicitation of proxies for a fee of $8,000 plus reimbursement of expenses.
The Annual Report to Stockholders for the Corporation's fiscal year ended May
31, 1994, including financial statements, is enclosed. Such Annual Report is not
to be treated as a part of the proxy solicitation material or as having been
incorporated herein by reference.
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
VOTING SECURITIES
Only stockholders of record at the close of business on July 29, 1994 will be
entitled to notice of and to vote at the meeting. As of such date, the
Corporation had outstanding and entitled to vote at the meeting 55,906,097
shares of Common Stock. Each share of Common Stock is entitled to one vote for
the election of the Class II Directors and for all other matters before the
meeting.
A majority of the outstanding shares will constitute a quorum at the meeting.
Abstentions and broker non-votes will be counted for purposes of determining the
presence of a quorum. Abstentions will be included in tabulations of the votes
cast on the proposals presented in the same manner as votes cast against such
proposals. Broker non-votes will not be counted either for or against the
proposal when determining whether a particular proposal has been approved.
1
<PAGE>
SECURITY OWNERSHIP OF MANAGEMENT AND CERTAIN BENEFICIAL OWNERS
The following table sets forth the amount of the Corporation's Common Stock
beneficially owned by each Director of the Corporation, each nominee to become a
Director, each of the Executive Officers named in the Summary Compensation Table
and by all Directors and executive officers as a group, as of the record date
for the annual meeting. Unless otherwise indicated, beneficial ownership is
direct and the person indicated has sole voting and investment power.
<TABLE>
<CAPTION>
AMOUNT AND NATURE OF PERCENT OF
NAME OF BENEFICIAL OWNER BENEFICIAL OWNERSHIP CLASS
- -------------------------------- --------------------- ----------
<S> <C> <C>
Smith, Frederick W.............. 5,002,748(1) 8.86%
Allen, Robert H................. 7,704(2) *
Baker, Howard H., Jr............ 6,000(2) *
Bryan, Anthony J. A............. 9,704(2) *
Cox, Robert L................... 31,000(3) *
DeNunzio, Ralph D............... 7,000(2) *
Estrin, Judith L ............... 6,000(2) *
Greer, Philip................... 27,978(2)(4) *
Hyde, J. R., III................ 25,000(2)(5) *
Manatt, Charles T............... 6,000(2) *
Smart, Jackson W., Jr........... 27,234(2)(6) *
Smith, Joshua I................. 1,000(7) *
Willmott, Peter S............... 48,950(2) *
Razzouk, William J.............. 22,176(8) *
Weise, Theodore L............... 82,604(9) *
Rodek, Jeffrey R................ 52,125(10) *
Masterson, Kenneth R............ 45,650(11) *
All directors and executive
officers as a group (28
persons)...................... 5,589,608(1)(2)(3)(4) 9.90%
(5)(6)(7)(8)
(9)(10)(11)(12)
<FN>
- ------------------------
(*) Less than 1% of issued and outstanding shares of Common Stock of the
Corporation.
(1) Includes 3,744,928 shares of Common Stock owned of record by Mr. Smith
(representing 6.63% of the outstanding Common Stock), 1,035,320 shares of
Common Stock owned of record by Frederick Smith Enterprise Company, Inc.
("Enterprise"), a family holding company, and 222,500 shares as to which
Mr. Smith has the right to acquire beneficial ownership through the
exercise of stock options which are vested or will become vested within 60
days of July 29, 1994 under the Corporation's 1987 and 1989 Stock Incentive
Plans. First Tennessee Bank, N.A., Memphis, Tennessee, as Trustee of a
trust of which Mr. Smith is the lifetime beneficiary, holds 55% of
Enterprise's outstanding stock and Mr. Smith owns 45% directly. Mr. Cox is
a director of Enterprise.
(2) Includes 5,000 shares of Common Stock as to which each Director who is not
also an employee of the Corporation has the right to acquire beneficial
ownership through the exercise of stock options which are vested or will
become vested within 60 days of July 29, 1994 under the Corporation's 1989
Stock Incentive Plan.
(3) Includes 30,000 shares of Common Stock owned by RLC Family Partners Ltd., a
limited partnership of which Mr. Cox is the sole general partner and 1,000
shares as to which Mr. Cox has the right to acquire beneficial ownership
through the exercise of stock options which are vested or will become
vested within 60 days of July 29, 1994 under the Corporation's 1989 Stock
Incentive Plan, and excludes 4,000 shares owned by Mr. Cox's wife as to
which Mr. Cox disclaims beneficial ownership.
(4) Excludes 11,156 shares of Common Stock owned of record and beneficially by
members of Mr. Greer's family as to which Mr. Greer disclaims beneficial
ownership.
(5) Includes 4,000 shares of Common Stock owned by a family trust and members
of Mr. Hyde's family.
(6) Includes 2,100 shares of Common Stock owned by Mr. Smart's wife.
(7) Includes 1,000 shares of Common Stock as to which Mr. Smith has the right
to acquire beneficial ownership through the exercise of stock options which
are vested or will become vested within 60 days of July 29, 1994 under the
Corporation's 1989 Stock Incentive Plan.
</TABLE>
2
<PAGE>
<TABLE>
<S> <C>
(8) Includes 12,550 shares of Common Stock as to which Mr. Razzouk has the
right to acquire beneficial ownership through the exercise of stock options
which are vested or will become vested within 60 days of July 29, 1994
under the Corporation's Stock Incentive Plans.
(9) Includes 43,365 shares of Common Stock as to which Mr. Weise has the right
to acquire beneficial ownership through the exercise of stock options which
are vested or will become vested within 60 days of July 29, 1994 under the
Corporation's Stock Incentive Plans and 4,914 shares owned by members of
Mr. Weise's family.
(10) Includes 39,090 shares of Common Stock as to which Mr. Rodek has the right
to acquire beneficial ownership through the exercise of stock options which
are vested or will become vested within 60 days of July 29, 1994 under the
Corporation's Stock Incentive Plans.
(11) Includes 43,150 shares of Common Stock as to which Mr. Masterson has the
right to acquire beneficial ownership through the exercise of stock options
which are vested or will become vested within 60 days of July 29, 1994
under the Corporation's Stock Incentive Plans.
(12) Includes 542,420 shares of Common Stock as to which the Directors and
Executive Officers as a group, have the right to acquire beneficial
ownership through the exercise of stock options which are vested or will
become vested within 60 days of July 29, 1994 under the Corporation's Stock
Incentive Plans.
</TABLE>
Listed below are certain persons who owned beneficially, as of December 31,
1993, more than five percent of the Corporation's Common Stock. This information
is based on Schedule 13Gs filed with the Securities and Exchange Commission.
<TABLE>
<CAPTION>
AMOUNT AND NATURE OF PERCENT OF CLASS AS
NAME AND ADDRESS OF BENEFICIAL OWNER BENEFICIAL OWNERSHIP OF DECEMBER 31, 1993
- --------------------------------------------------------------------------- -------------------- ---------------------
<S> <C> <C>
The Capital Group, Inc. ................................................... 6,452,850(1) 11.72 %
333 South Hope Street
Los Angeles, California 90071
Sanford C. Bernstein & Co., Inc. .......................................... 4,527,176(2) 8.17
767 Fifth Avenue
New York, New York 10153
<FN>
- ------------------------
(1) Capital Guardian Trust Company ("Capital Guardian"), a bank and operating
subsidiary of The Capital Group, Inc. exercised investment discretion over
2,079,650 of the aggregate shares. Capital Research and Management
Company, a registered investment advisor, and Capital International
Limited, another operating subsidiary, had investment discretion with
respect to 4,270,000 and 103,200 shares, respectively. The Capital Group,
Inc. had sole power to vote or to direct the vote with respect to
1,661,380 shares. Neither The Capital Group, Inc. nor any of its
subsidiaries had the power to vote or to direct the vote of the remaining
shares. The Capital Group, Inc. disclaimed beneficial ownership of all
such shares of the Corporation.
(2) Sanford Bernstein exercises sole investment discretion with respect to the
shares and sole voting power with respect to 2,346,408 of such shares.
Sanford Bernstein does not disclaim beneficial ownership of any such
shares.
</TABLE>
ELECTION OF DIRECTORS
(PROPOSAL NO. 1)
At the date of the Annual Meeting, the Board of Directors will consist of
thirteen members, divided into three classes. Four nominees (the "Class II
Directors") are to be elected at this Annual Meeting to serve for a term of
three years and until their successors are elected and qualified. The remaining
nine Directors will continue to serve as set forth below, with five Directors
(the "Class III Directors") having terms expiring at the 1995 Annual Meeting and
four Directors (the "Class I Directors") having terms expiring at the 1996
Annual Meeting. The nominees for election as Class II Directors are now
directors of the Corporation. Each nominee has agreed to serve if elected. The
proxy holders will vote the proxies received by them for the four Class II
nominees or, in the event of a contingency not presently foreseen, for different
persons as substitutes therefor unless authority is withheld.
3
<PAGE>
The following sets forth, with respect to each nominee and each Director
continuing to serve, his or her name, age, principal occupation and employment
during the past five years, the year in which he or she first became a Director
of the Corporation and directorships held in other corporations.
NOMINEES FOR ELECTION AS
CLASS II DIRECTORS FOR A THREE-YEAR
TERM EXPIRING AT THE 1997 ANNUAL MEETING
<TABLE>
<CAPTION>
DIRECTOR, YEAR FIRST PRINCIPAL OCCUPATION,
ELECTED AS DIRECTOR AGE BUSINESS AND DIRECTORSHIPS
- -------------------- --- -----------------------------------------------------
<C> <C> <S>
Ralph D. DeNunzio 62 President of Harbor Point Associates, Inc., a private
1981 investment and consulting firm, since October 1987.
Director, AMP Incorporated, Harris Corporation and
NIKE, Inc.
Charles T. Manatt 58 Senior Partner, Manatt, Phelps & Phillips, a law
1989 firm, for more than the past five years; Chairman of
First Los Angeles Bank for more than five years until
December 1989. Director, GTE California Incorporated,
GTE Northwest Telephone Company, SPI Pharmaceuticals
Inc. and Castle & Cook Homes.
Jackson W. Smart, 63 Chairman and Chief Executive Officer of MSP
Jr. Communications, Inc., a radio broadcasting company,
1976 since October 1988. Trustee, Goldman Sachs --
Institutional Liquid Assets, Financial Square Money
Market Trust, Goldman Sachs Trust and Goldman Sachs
Equity Portfolios Inc.; Director, North American
Private Equity Fund and Evanston Hospital
Corporation.
Joshua I. Smith 53 Chairman, President and Chief Executive Officer of
1989 The MAXIMA Corporation, an information and data
processing firm, since 1978. Director, Caterpillar,
Inc. and Inland Steel Industries, Inc.
</TABLE>
CLASS III DIRECTORS CONTINUING IN OFFICE
WHOSE TERMS EXPIRE AT THE 1995 ANNUAL MEETING
<TABLE>
<CAPTION>
DIRECTOR, YEAR FIRST PRINCIPAL OCCUPATION,
ELECTED AS DIRECTOR AGE BUSINESS AND DIRECTORSHIPS
- -------------------- --- -----------------------------------------------------
<C> <C> <S>
Howard H. Baker, Jr. 68 Partner, Baker, Worthington, Crossley & Stansberry, a
1988 law firm, since July 1988. Director, Pennzoil
Company, United Technologies Corporation and WMX
Technologies, Inc.
Judith L. Estrin 39 Chief Executive Officer and President of Network
1989 Computing Devices, Inc., a company that supplies
display stations for network computing environments,
since September 1993; Executive Vice President of
Network Computing Devices, Inc. from July 1988 to
September 1993. Director, Network Computing Devices,
Inc.
Philip Greer 58 General Partner of Weiss, Peck & Greer Investments, a
1974 diversified investment management and securities
firm, since 1970. Director, Network Computing
Devices, Inc. and Robert Mondavi Winery.
J. R. Hyde, III 51 Chairman and Chief Executive Officer of AutoZone,
1977 Inc., an auto parts retail chain, since July 1988.
Director, AutoZone, Inc. and First Tennessee National
Corporation.
Frederick W. Smith 49 Chairman, President and Chief Executive Officer of
1971 the Corporation since 1983; Chief Executive Officer
of the Corporation since 1977; Chairman of the
Corporation since 1975; and President of the
Corporation from 1971 to 1975.
</TABLE>
4
<PAGE>
CLASS I DIRECTORS CONTINUING IN OFFICE
WHOSE TERMS EXPIRE AT THE 1996 ANNUAL MEETING
<TABLE>
<CAPTION>
DIRECTOR, YEAR FIRST PRINCIPAL OCCUPATION,
ELECTED AS DIRECTOR AGE BUSINESS AND DIRECTORSHIPS
- -------------------- --- -----------------------------------------------------
<C> <C> <S>
Robert H. Allen 66 Private Investor and Managing Partner, Challenge
1977 Investment Partners, an investment firm, since May
1993; Chairman and Chief Executive Officer of Realm
Resources, Inc., a natural resource company, from
1983 to 1991. Director, Baylor College of Medicine,
First City Bank of Texas, Geoquest International,
Inc. and Nuevo Energy Company.
Anthony J. A. Bryan 71 Chairman, Executive Committee, Hospital Corporation
1978 International, a company that owns, manages and
builds hospitals and health-related facilities in
various countries around the world, since March 1991;
Chairman, Hospital Corporation International from
July 1991 until September 1992; Chairman and Chief
Executive Officer of Oceonics Group PLC from March
1988 to March 1991.
Robert L. Cox 58 Partner, Waring Cox, a law firm, for more than the
1993 past five years and Secretary of the Corporation from
June 1971 to September 1993.
Peter S. Willmott 57 Chairman and Chief Executive Officer of Willmott
1974 Services, Inc., a retail and consulting firm, since
June 1989; President and Chief Operating Officer of
the Corporation from September 1980 to May 1983;
Executive Vice President of the Corporation from 1977
to 1980; Senior Vice President-Finance and
Administration of the Corporation from 1974 to 1977.
Director, Browning-Ferris Industries, Inc.,
International Multifoods Corporation, Mac Frugal's
Bargains -- Close-Outs, Inc., Maytag Corporation,
Morgan Keegan & Co., Inc. and Zenith Electronics
Corporation.
</TABLE>
MEETINGS AND COMMITTEES
The Board of Directors of the Corporation conducted seven regular and two
special meetings during fiscal 1994. Each Director, with the exceptions of Mr.
Hyde and Mr. Willmott, attended at least 75% of the meetings of the Board and
any committees on which they served.
The Board of Directors has an Audit Committee and a Compensation Committee. The
present members of the Audit Committee are Philip Greer (Chairman), Howard H.
Baker, Jr., Anthony J. A. Bryan, Robert L. Cox, Charles T. Manatt and Peter S.
Willmott. The basic responsibilities of the Audit Committee, as approved by the
Board of Directors, are to review significant financial information for the
purpose of giving added assurance that the information is accurate and timely
and that it includes all appropriate financial statement disclosures; to
ascertain the existence of effective accounting and internal control systems; to
oversee the entire audit function -- both internal and independent; and to
provide an effective communication link between the auditors (internal and
independent) and the Board of Directors. The Audit Committee met eight times
during fiscal 1994.
The present members of the Compensation Committee are Jackson W. Smart, Jr.
(Chairman), Robert H. Allen, Ralph D. DeNunzio, J. R. Hyde, III and Joshua I.
Smith. The Compensation Committee determines the salaries, bonuses and other
remuneration and terms and conditions of employment of the officers of the
Corporation, administers the Corporation's Stock Incentive and Restricted Stock
Plans, oversees the administration of the Corporation's employee benefit plans
covering employees generally and makes recommendations to the Board of Directors
with respect to the Corporation's compensation policies. The Compensation
Committee held seven meetings in fiscal 1994. The Board of Directors does not
have a nominating committee.
LEGAL PROCEEDINGS
The Company has reached a tentative settlement of the shareholder class-action
lawsuit filed in 1990 against it, Frederick W. Smith, Chairman and Chief
Executive Officer, and James L. Barksdale, the Company's former Executive Vice
President and Chief Operating Officer. The settlement, which still must be
approved by the United States District Court for the Western District of
Tennessee, is for an immaterial amount (the Company's portion of which has been
recorded in the 1994 financial statements). The Company's insurance carrier will
pay a majority of the settlement amount.
5
<PAGE>
The Company currently believes that the Court will approve or disapprove the
settlement agreement before the end of its current fiscal year. Prior to the
Court's decision, the purchasers of the Company's Common Stock affected by the
settlement agreement must be notified of the terms of the settlement and a
hearing must be held in the District Court.
SUMMARY COMPENSATION TABLE
The following table sets forth the compensation awarded to, earned by or paid to
the Corporation's Chief Executive Officer and its four other most
highly-compensated executive officers for services rendered in all capacities
during the fiscal years ended May 31, 1994, 1993 and 1992.
<TABLE>
<CAPTION>
LONG TERM COMPENSATION
-----------------------
AWARDS
ANNUAL COMPENSATION -----------------------
------------------------------ RESTRICTED SECURITIES
OTHER ANNUAL STOCK UNDERLYING ALL OTHER
SALARY BONUS COMPENSATION AWARD(S) OPTIONS/ COMPENSATION
NAME AND PRINCIPAL POSITION YEAR ($) ($) ($)(1) ($)(2) SARS (#) ($)(1)(3)
- ---------------------------------------- ---- ------- ------- ------------ ---------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Frederick W. Smith 1994 650,121 470,000 84,016(4) -- 100,000 5,573
Chairman & Chief 1993 550,368 -- 66,404 -- -- 2,154
Executive Officer 1992 550,368 -- -- -- -- --
William J. Razzouk 1994 436,386 343,690 169,152 260,000 50,000 5,281
Executive Vice President 1993 301,905 34,070 -- -- 5,000 2,154
Worldwide Customer 1992 241,049 16,398 -- 218,750 8,000 --
Operations
Theodore L. Weise 1994 399,360 214,675 105,720 162,500 25,000 4,440
Senior Vice President 1993 364,585 33,261 -- -- 5,000 2,154
Air Operations 1992 328,901 30,438 -- -- 9,500 --
Jeffrey R. Rodek 1994 363,087 166,974 -- -- 25,000 4,249
Senior Vice President 1993 310,548 39,618 -- -- 5,000 2,154
Americas & Caribbean 1992 253,867 14,533 -- -- 5,100 --
Kenneth R. Masterson 1994 357,162 155,428 -- -- 20,000 4,175
Senior Vice President, 1993 345,198 45,111 -- -- 9,000 2,154
General Counsel 1992 295,202 13,898 -- -- 5,500 --
and Secretary
<FN>
- ------------------------
(1) In accordance with transitional provisions of the Securities and Exchange
Commission's rules on executive compensation disclosure in proxy
statements, amounts of Other Annual Compensation and All Other
Compensation have not been included for fiscal year 1992. The amounts
shown for Mr. Razzouk and Mr. Weise represent tax reimbursements related
to restricted stock awards.
(2) The amounts in the table represent the closing market value of the shares
awarded at the date of grant. At May 31, 1994, the number and value of the
restricted stock holdings of the named individuals were as follows:
</TABLE>
<TABLE>
<CAPTION>
NAME NUMBER OF SHARES HELD VALUE
- ----------------------------------------------------------- ----------------------- ----------
<S> <C> <C>
F.W. Smith................................................. -- --
W.J. Razzouk............................................... 9,625 $ 736,313
T.L. Weise................................................. 5,000 382,500
J.R. Rodek................................................. 2,500 191,250
K.R. Masterson............................................. 2,500 191,250
</TABLE>
The restrictions on the shares awarded to Mr. Razzouk lapse ratably over
five years after the date of award with respect to 2,500 shares granted in
October 1990 and lapse ratably over four years after the date of award with
respect to 7,125 shares granted in September 1991 and October 1993. The
restrictions on the shares awarded to Mr. Weise lapse ratably over three
years after the date of award with respect to 2,500 shares granted in
October 1993 and lapse ratably over five years with respect to 2,500 shares
granted in July 1989. The restrictions on the shares awarded to Mr. Rodek
and Mr. Masterson lapse ratably over five years after the date of award.
6
<PAGE>
Holders of restricted shares are entitled to receive any dividends declared
on such shares. The Corporation has never declared a dividend on its shares
because its policy has been to reinvest earnings in the business of the
Corporation.
(3) These amounts represent profit sharing payments to the named executive
officers and contributions under the Corporation's Deferred Profit Sharing
Plan.
(4) Of the amount shown, $65,328 represents personal use of corporate aircraft
which is treated as taxable income to Mr. Smith.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
The following table sets forth information regarding grants of stock options
during the fiscal year ended May 31, 1994 made to the named executive officers
under the Corporation's Stock Incentive Plans. The amounts shown for each of the
named executive officers as potential realizable values are based on arbitrarily
assumed annualized rates of stock price appreciation of five percent and ten
percent over the full ten-year term of the options, which would result in stock
prices of approximately $102.52 and $163.24, respectively, for the options with
an exercise price of $62.9375, and $115.35 and $183.67, respectively, for the
options with an exercise price of $70.8125. No gain to the optionees is possible
without an increase in stock price which will benefit all stockholders
proportionately. These potential realizable values are based solely on
arbitrarily assumed rates of appreciation required by applicable Securities and
Exchange Commission regulations. Actual gains, if any, on option exercise and
common stock holdings are dependent on the future performance of the
Corporation's Common Stock and overall stock market conditions. There can be no
assurance that the potential realizable values shown in this table will be
achieved.
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS POTENTIAL REALIZABLE
------------------------------------------------------ VALUE AT ASSUMED ANNUAL
NUMBER OF % OF TOTAL RATES OF STOCK PRICE
SECURITIES OPTIONS/SARS APPRECIATION FOR OPTION
UNDERLYING GRANTED TO EXERCISE OR TERM
OPTIONS/SARS EMPLOYEES IN BASE PRICE EXPIRATION -----------------------
NAME GRANTED (#) FISCAL YEAR ($/SH)* DATE 5% ($) 10% ($)
- ------------------------------ ------------ ------------ ----------- ---------- ---------- -----------
<S> <C> <C> <C> <C> <C> <C>
F.W. Smith.................... 100,000 10.30 62.9375 9/27/2003 3,958,250 10,030,250
W.J. Razzouk.................. 35,000 3.61 62.9375 9/27/2003 1,385,387 3,510,587
15,000 1.55 70.8125 12/6/2003 668,062 1,692,862
T.L. Weise.................... 25,000 2.58 62.9375 9/27/2003 989,562 2,507,562
J.R. Rodek.................... 25,000 2.58 62.9375 9/27/2003 989,562 2,507,562
K.R. Masterson................ 20,000 2.06 62.9375 9/27/2003 791,650 2,006,050
<FN>
- ------------------------
* The option exercise price of the options granted to the individuals shown
above was the fair market value of the Corporation's Common Stock at the
date of grant of the option. In each case, the options are subject to a
vesting schedule as follows: 20% after one year from the date of grant;
40% after two years; 60% after three years; 80% after four years; and 100%
after five years. The options may not be transferred in any manner other
than by will or the laws of descent and distribution and may be exercised
during the lifetime of the optionee only by the optionee. During the
fiscal year ended May 31, 1994, options for a total of 970,750 shares were
granted to various employees of the Corporation.
</TABLE>
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTION/SAR VALUES
The following table summarizes for each of the named executive officers certain
information relating to stock options exercised by them during the fiscal year
ended May 31, 1994. Value realized upon exercise is the difference between the
fair market value of the underlying stock on the exercise date and the exercise
or base price of the option. The value of an unexercised, in-the-money option at
fiscal year-end is the difference between its exercise or base price and the
fair market value of the underlying stock on May 31, 1994, which was $76.125 per
share. These values, unlike the amounts set forth in the column "Value
Realized," have not been, and may never be,
7
<PAGE>
realized. The options have not been, and may not be, exercised; and actual
gains, if any, on exercise will depend on the value of the Corporation's Common
Stock on the date of exercise. There can be no assurance that these values will
be realized. Unexercisable options are those which have not yet vested.
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY
VALUE OPTIONS/SARS AT FY-END # OPTIONS/SARS AT FY-END ($)
SHARES ACQUIRED REALIZED --------------------------- ---------------------------
NAME ON EXERCISE (#) ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- -------------------------------- --------------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
F.W. Smith...................... -- -- 202,500 100,000 7,327,969 1,318,750
W.J. Razzouk.................... 13,000 250,248 400 66,800 11,250 1,094,875
T.L. Weise...................... 15,985 485,714 33,615 38,400 999,168 718,907
J.R. Rodek...................... 3,750 147,656 31,740 36,860 971,106 671,613
K.R. Masterson.................. 10,000 288,125 34,400 34,600 1,018,276 692,194
</TABLE>
PENSION PLAN TABLE
The following table shows the estimated annual pension benefits payable to
participants upon retirement on a single straight life annuity basis in
specified remuneration classes and years of credited service under the Federal
Express Corporation Employees' Pension Plan and the Federal Express Corporation
Retirement Parity Pension Plan which provides 100 percent of the benefit that
would otherwise be denied participants by reason of certain Internal Revenue
Code limitations on qualified plan benefits. The benefits listed in the table
are not subject to any reduction for Social Security or other offset amounts.
<TABLE>
<CAPTION>
YEARS OF SERVICE
-----------------------------------------------------
REMUNERATION 10 15 20 25 30
- --------------------------------------------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
250,000...................................... 50,000 75,000 100,000 125,000 125,000
300,000...................................... 60,000 90,000 120,000 150,000 150,000
350,000...................................... 70,000 105,000 140,000 175,000 175,000
400,000...................................... 80,000 120,000 160,000 200,000 200,000
450,000...................................... 90,000 135,000 180,000 225,000 225,000
500,000...................................... 100,000 150,000 200,000 250,000 250,000
550,000...................................... 110,000 165,000 220,000 275,000 275,000
600,000...................................... 120,000 180,000 240,000 300,000 300,000
700,000...................................... 140,000 210,000 280,000 350,000 350,000
800,000...................................... 160,000 240,000 320,000 400,000 400,000
</TABLE>
The remuneration as specified above includes Salary and Bonus as reported in the
Summary Compensation Table (p. 6). Since the covered compensation is the average
over the five-year period preceding retirement, the amount differs from that set
forth in the Summary Compensation Table and is stated below together with the
credited years of service achieved.
<TABLE>
<CAPTION>
YEARS OF
NAME COVERED COMPENSATION SERVICE
- -------------------------------------------------------------- --------------------- ---------------
<S> <C> <C>
F.W. Smith.................................................... $ 657,010 22
W.J. Razzouk.................................................. 293,055 11
T.L. Weise.................................................... 370,407 22
J.R. Rodek.................................................... 274,533 16
K.R. Masterson................................................ 330,489 14
</TABLE>
REPORT ON EXECUTIVE COMPENSATION OF THE
COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS
The compensation of the Corporation's executives comprises three basic
components: base salary, annual and long-term performance bonus plans, and
long-term equity incentives. The Compensation Committee (the "Committee") of the
Board of Directors determines the compensation of the executive officers of the
Corporation, approves the objectives for the annual and long-term performance
bonus plans, establishes the funding of the plans, determines the awards of
long-term equity incentives and the individuals to whom such awards are made,
and recommends to the Board of Directors the compensation of the chief executive
officer of the Corporation.
BASE SALARY. The establishment of competitive base compensation for the
Corporation's executives is the primary objective in setting base salaries. The
starting point for this process is to determine the relative importance of an
8
<PAGE>
executive officer's position, the extent of accountability of the position and
the skills required to perform the duties of the position. In addition, the
Corporation utilizes compensation surveys published by three major consulting
firms of companies in general industry with $5 billion or more in annual sales.
The Committee believes that general industry is an appropriate comparison
category in determining competitive compensation because the Corporation's
executives can be recruited from, and by, businesses outside the Corporation's
industry peer group. Base salaries are targeted at the median (or 50th
percentile) of base salaries for comparable positions in the comparison surveys
mentioned above.
None of the factors mentioned above is given any particular weight in
determining base compensation. Other factors may also influence such
determination, such as the relative extent of an individual's experience or a
desire to retain a valuable executive. In particular, several executive officers
were afforded base salary increases in 1994 to address outside recruiting
pressures. The Committee's target for Mr. Smith is the 50th percentile as is the
case with the other executive officers. Mr. Smith's base salary was increased in
1994; however, his base salary remains at less than the 25th percentile of base
salaries of chief executive officers in the comparison surveys because his last
previous salary increase was in fiscal 1991.
PERFORMANCE BONUS PLANS. Under the Corporation's annual performance bonus plan,
a bonus opportunity is established at the beginning of each fiscal year for
management and certain professional employees based on the degree of attainment
of both corporate and individual goals for the year. Each position eligible for
such bonus, including all executive officers but excluding Mr. Smith, is
assigned a number of points based on salary grade. Individual objectives for
each position are established and points are allocated to the objectives by each
participant and his or her immediate superior. A participant earns points by
achieving his or her individual objectives. The amount of a participant's bonus
is determined by the number of points earned, multiplied by the dollar value, if
any, assigned to each point by the Committee according to the extent of
achievement of plan objectives.
The plan objectives established for 1994 were (i) a pretax income goal, (ii) an
internal measure reflecting a targeted level of service quality and (iii)
achievement of a corporate leadership index based on an annual attitudinal
survey of employees. For 1994, the pretax income goal and the internal service
measure target were assigned 85% and 15% weightings, respectively. The corporate
leadership index was an additional qualifier for 1994 which, although not
assigned any particular weighting, is a factor to be considered by the Committee
in its discretion in establishing bonuses based on whether this objective was
met, not met or exceeded.
If both the individual and plan objectives are achieved, the plan is designed to
produce a bonus ranging, on a sliding scale, from a threshold amount if the plan
objectives are minimally achieved, up to a maximum amount if such objectives are
substantially exceeded. For 1994, the threshold bonus target was established at
an amount which, when added to base salary, would be less than the 50th
percentile of total salary and bonus for comparable positions in the comparison
surveys discussed above under BASE SALARY. Thus, total salary and bonus for
executive officers (assuming achievement of all individual objectives) is
designed to range from less than the 50th up to the 75th percentile of total
salary and bonus for comparable positions in the comparison surveys according to
the degree to which plan objectives are met or exceeded.
For 1994, bonuses were awarded to executive officers (other than Mr. Smith)
based on achievement of above-plan targets for pretax income for the entire
fiscal year. The service quality index goal was not achieved. The corporate
leadership index goal was achieved.
Mr. Smith's bonus is not determined by a number of points specifically assigned
to his position as is the case with other management personnel, but by whether
corporate business plan objectives are met or exceeded. If such objectives are
met, the Committee determines and recommends to the Board of Directors a bonus
which, when combined with base salary, may be up to the 75th percentile of total
salary and bonus for chief executive officers in the comparison surveys
discussed above under BASE SALARY. Mr. Smith's bonus for 1994 combined with his
base salary amounted to less than the 50th percentile of total salary and bonus
of chief executive officers in these comparison surveys. In addition to the
comparison surveys, the Committee also considers publicly available compensation
information on chief executive officers of a variety of other transportation
companies in determining Mr. Smith's total salary and bonus. These companies
comprise most of the companies in the Standard & Poor's Transportation Index and
the Dow Jones Transportation Average, but also include several other companies
not in these indices.
In 1994, the Committee established a long-term performance bonus plan to provide
a long-term cash bonus opportunity to members of upper management, including
executive officers, at the conclusion of fiscal year 1996 if the Corporation
achieves certain earnings per share targets established by the Committee with
respect to the
9
<PAGE>
three-fiscal year period 1994 through 1996. However, no amounts can be earned
until fiscal 1996 because it is only after the conclusion of that year that the
Committee can determine the extent of achievement of the three-year earnings per
share objectives. The Committee has established a similar plan for the
three-fiscal year period 1995 through 1997 providing a bonus opportunity for
1997 if certain earnings per share targets are achieved with respect to that
period. Under both plans, an individual's bonus will be a set dollar amount
ranging from a threshold amount if the objectives are minimally achieved, up to
a maximum amount if the plan targets are substantially exceeded.
LONG-TERM EQUITY INCENTIVES. Stock options were granted as long-term incentives
in 1994 to certain key employees of the Corporation, including executive
officers, under various of the Corporation's Stock Incentive Plans. Under the
terms of the plans, the Corporation may grant options to key employees
(determined by the Committee) to purchase such number of shares of the Common
Stock of the Corporation as is determined by the Committee.
The number of shares for which options are granted to executive officers is
generally determined by the Committee based on the respective officer's senior
officer status. For example, options granted to Senior Vice Presidents are
usually for the same number of shares, while a grant to the Executive Vice
President will usually be for more shares than granted to Senior Vice
Presidents. However, no set criteria are used and other factors may influence
the Committee's determination with respect to the number of shares granted, such
as the promotion of an individual to a higher position, a desire to retain a
valued executive or the number of shares then available for grant under one or
more of the plans. The stock option holdings of an individual at the time of a
grant are generally not considered in determining the size of a grant to that
individual.
Restricted stock was awarded in 1994 to certain executive officers of the
Corporation under the Corporation's 1986 Restricted Stock Plan. Under the terms
of the Restricted Stock Plan, the Corporation may award restricted stock to key
employees as determined by the Committee. No set criteria are used to determine
the amount of restricted stock awarded; however, the Committee's determination
may be influenced with respect to the number of shares awarded by factors such
as the respective officer's senior officer status, the promotion of an
individual to a higher position, a desire to retain a valued executive, a desire
to recognize a particular officer's contribution to the Corporation or the
number of shares then available for award. In 1994 four of the five executive
officers who received awards were promoted. The Committee considered the awards
to these individuals compared to previous awards to individuals in similar
positions when determining the size of the awards. The other executive officer
received a restricted stock award in recognition of his outstanding
contributions to the Corporation.
A feature of the Omnibus Budget Reconciliation Act of 1993 limits deductibility
of certain compensation for the chief executive officer and the four other
highest-paid executive officers to $1 million per year, effective for tax years
beginning on or after January 1, 1994. The policy of the Corporation is
generally to design its compensation plans and programs to ensure full
deductibility. However, the Committee reserves the right to, in its discretion,
pay compensation that will not be deductible if the nondeductible amounts will
not significantly affect the Corporation's tax liability and if it is deemed to
be in the best interest of the Corporation; for example, by not disclosing
confidential performance criteria.
COMPENSATION COMMITTEE MEMBERS
Jackson W. Smart, Jr. -- CHAIRMAN
<TABLE>
<S> <C>
Robert H. Allen Ralph D. DeNunzio
J.R. Hyde, III Joshua I. Smith
</TABLE>
May 31, 1994
10
<PAGE>
STOCK PERFORMANCE GRAPH
The Stock Performance Graph below shall not be deemed incorporated by reference
by any general statement incorporating by reference this Proxy Statement into
any filing under the Securities Act of 1933 or under the Securities Exchange Act
of 1934, except to the extent the Corporation specifically incorporates this
information by reference, and shall not otherwise be deemed filed under such
acts.
The following graph shows changes over the past five fiscal years in the value
of $100 invested on May 31, 1989 in: (1) the Corporation's Common Stock; (2) the
Standard & Poor's 500 Composite Index; and (3) the Standard & Poor's
Transportation Index. A paper copy of the Corporation's Stock Performance Graph
was filed with the Commission under cover of Form SE.
COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN
(FDX, S&P 500 COMPOSITE INDEX AND S&P TRANSPORTATION INDEX)
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
Federal
Express S&P 500 Comp. Index S&P Trans. Index
<S> <C> <C> <C>
1989 100 100 100
1990 98 117 107
1991 85 130 119
1992 86 143 142
1993 104 160 157
1994 162 166 164
</TABLE>
<TABLE>
<CAPTION>
1989 1990 1991 1992 1993 1994
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
FDX..................................... 100 98 85 86 104 162
S & P 500 Composite Index............... 100 117 130 143 160 166
S & P Transportation Index.............. 100 107 119 142 157 164
</TABLE>
11
<PAGE>
The total return assumes that all dividends were reinvested. No dividends were
paid on the Corporation's Common Stock during the period.
TRANSACTIONS WITH MANAGEMENT AND OTHERS
Pursuant to the provisions of the Corporation's Stock Incentive Plans, the
Corporation has made interest-free demand loans to certain officers, fully
secured by Common Stock of the Corporation, to assist them in exercising
non-incentive stock options and paying any tax liability associated with such
exercise. Such loans are repayable on demand or upon termination of employment
for any reason. The following table shows the highest balance of such loans
outstanding during the period June 1, 1993 through July 29, 1994 and the balance
of such loans outstanding at July 29, 1994, for those executive officers with
loan balances which exceeded $60,000.
<TABLE>
<CAPTION>
BALANCE AT
HIGHEST BALANCE JULY 29,
EXECUTIVE OFFICER DURING PERIOD 1994
- ----------------------------------------------------------------------------------------- --------------- ------------
<S> <C> <C>
Theodore L. Weise, Senior Vice President
Air Operations.......................................................................... $ 619,031 $ 619,031
William J. Razzouk, Executive Vice President
Worldwide Customer Operations........................................................... 212,203 --
</TABLE>
The law firm of Baker, Worthington, Crossley & Stansberry has represented the
Corporation during fiscal year 1994 pursuant to a retainer arrangement. Mr.
Baker, a Director, is a named partner in that firm.
The law firm of Manatt, Phelps & Phillips has represented the Corporation during
fiscal year 1994 pursuant to a retainer arrangement. Mr. Manatt, a Director, is
a named partner in that firm.
The law firm of Waring Cox has represented the Corporation during fiscal year
1994. Mr. Cox, a Director, is a named partner in that firm.
During fiscal year 1994, the Corporation purchased computer devices and services
in the amount of $1,356,980 from Network Computing Devices, Inc. The Corporation
can be expected to purchase from Network Computing Devices, Inc. in the future.
Ms. Estrin, a Director, is the Chief Executive Officer, President and a director
of Network Computing Devices, Inc. Mr. Greer, a Director, is also a director of
Network Computing Devices, Inc.
COMPENSATION OF DIRECTORS
For fiscal 1995, outside Directors are to be paid a quarterly retainer of
$7,500, $2,000 for each meeting of the Board attended and $1,000 for each
meeting of its Committees which they attend. Committee chairmen will be paid an
additional annual fee of $5,500. In addition, outside Directors will be granted
an option under the Corporation's 1993 Stock Incentive Plan for 1,000 shares of
Common Stock on each of the five consecutive Annual Meeting dates beginning
September 26, 1994. Officers of the Corporation receive no compensation for
serving as Directors.
The Corporation has a Retirement Plan for Outside Directors to attract, retain
and motivate directors who are not also employees of the Corporation to serve on
the Corporation's Board of Directors. The plan is unfunded and benefits provided
thereunder are payable out of the assets of the Corporation as a general,
unsecured obligation of the Corporation. An outside Director who has served at
least five years on the Board of Directors is entitled to a retirement benefit
beginning as of the first day of the fiscal quarter of the Corporation next
following the date of termination of his or her directorship or the date such
Director attains age 60, whichever is later. The benefit will be an annual
amount, payable as a lump-sum distribution or in quarterly installments for no
less than ten years and no more than fifteen years depending on years of
service, equal to a percentage from 50% to 100% (as determined by years of
service) of the annual retainer fee being paid to the outside Director at the
time of his or her termination as a Director.
SECTION 16 FILINGS
Under the securities laws of the United States, the Corporation's Directors and
Executive Officers are required to report their initial ownership of the
Corporation's Common Stock and any subsequent changes in that ownership to the
Securities and Exchange Commission. Specific due dates for these reports have
been established by the Commission and the Corporation is required to disclose
in this Proxy Statement any late filings or failure to file. Mr. Masterson made
a late filing of a single Form 4 involving one transaction in the Corporation's
Common Stock.
12
<PAGE>
CHANGE IN CONTROL ARRANGEMENT
The Corporation's 1980, 1983, 1984, 1987, 1989 and 1993 Stock Incentive Plans
provide that in the event of a change in control each holder of an unexpired
option under any of the plans has the right to exercise such option without
regard to the date such option would first be exercisable. This right continues,
with respect to holders whose employment with the Corporation terminates
following a change in control, for a period of twelve months after such
termination or until the option's expiration date, whichever is sooner. The
instruments pursuant to which restricted stock was granted during fiscal 1994
under the Restricted Stock Plan provide for the immediate lapse of restrictions
on shares granted in the event of a change in control.
AMENDMENT TO THE CORPORATION'S RESTATED
CERTIFICATE OF INCORPORATION
TO INCREASE AUTHORIZED COMMON STOCK
(PROPOSAL NO. 2)
The Board of Directors has authorized the submission to the stockholders for
their approval of an amendment to Article Fourth of the Corporation's Restated
Certificate of Incorporation to provide for an increase in the number of shares
of Common Stock authorized for issuance from 100,000,000 to 200,000,000. A copy
of the revised Article Fourth is included in this Proxy Statement as Exhibit A.
As of May 31, 1994, the Corporation had 55,874,731 shares of Common Stock issued
and outstanding and there were 3,683,170 shares of Common Stock reserved for
issuance under the Company's Stock Incentive and Restricted Stock Plans.
Although the Corporation has studied, and continues to study, opportunities
which may involve the issuance of its Common Stock, the Corporation has no
present plans and has not entered into any contracts, arrangements or
understandings (except as noted above with respect to stock option plans)
concerning the issuance of any additional Common Stock. The Board of Directors
believes an increase in the maximum number of authorized shares of Common Stock
is advisable at this time to provide for the availability of shares for issuance
in the future if the need arises, such as in connection with stock options,
stock dividends, stock splits, possible acquisitions, financings, public
offerings and other appropriate corporate purposes.
The amendment, if approved, would not itself affect the relative equities of
present stockholders. However, if the amendment is approved, the Board of
Directors will not be required to obtain further stockholder approval prior to
the issuance of any such additional shares except in transactions legally
requiring stockholder approval under Delaware law, such as certain mergers to
which the Corporation might be a party. Stockholders do not have preemptive
rights to subscribe for or purchase additional shares of Common Stock and any
issuance of Common Stock on other than a pro-rata basis may dilute the ownership
interest of present stockholders. Approval of the amendment by the affirmative
vote of the holders of a majority of the Corporation's issued and outstanding
Common Stock at July 29, 1994 is required for its adoption.
THE BOARD RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" THIS PROPOSAL.
AUDITORS
(PROPOSAL NO. 3)
Arthur Andersen & Co. have been the auditors for the Corporation since 1972.
Upon the recommendation of the Audit Committee, the Board of Directors has
designated Arthur Andersen & Co. to be the independent auditors of the
Corporation for the year ending May 31, 1995. The Board of Directors will offer
a resolution at the Annual Meeting to ratify this designation. It is anticipated
that representatives of Arthur Andersen & Co. will be present at the meeting to
respond to appropriate questions, and they will have an opportunity, if they
desire, to make a statement.
THE BOARD RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" THIS PROPOSAL.
STOCKHOLDER PROPOSALS
Proposals of stockholders intended to be presented at the Corporation's 1995
Annual Meeting of Stockholders must be received by the Corporation on or prior
to April 15, 1995 to be eligible for inclusion in the Corporation's proxy
statement and form of proxy to be used in connection with the 1995 Annual
Meeting of Stockholders.
13
<PAGE>
OTHER BUSINESS
The Board of Directors knows of no other business which will be presented at the
meeting. If, however, other matters are properly presented, the persons named in
the enclosed proxy will vote the shares represented thereby in accordance with
their best judgment.
By order of the Board of Directors,
/s/ KENNETH R. MASTERSON
KENNETH R. MASTERSON
SECRETARY
14
<PAGE>
EXHIBIT A
AMENDMENT TO THE FEDERAL EXPRESS CORPORATION
RESTATED CERTIFICATE OF INCORPORATION
If approved by the stockholders of the Corporation, delete Article Fourth and
substitute in lieu thereof the following:
ARTICLE FOURTH: The total number of shares of all classes of stock which the
Corporation shall have authority to issue is 204,000,000 shares consisting of
4,000,000 shares of Series Preferred Stock, no par value (herein called the
"Series Preferred Stock"), and 200,000,000 shares of Common Stock, par value
$0.10 per share (herein called the "Common Stock").
<PAGE>
P R O X Y
FEDERAL EXPRESS CORPORATION
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
THE CORPORATION FOR THE ANNUAL MEETING OF STOCKHOLDERS SEPTEMBER 26, 1994
The undersigned hereby constitutes and appoints KENNETH R. MASTERSON and William
J. Razzouk, and each of them, his or her true and lawful agents and proxies with
full power of substitution in each, to represent the undersigned and to vote all
of the shares of stock of the undersigned in Federal Express Corporation at the
Annual Meeting of Stockholders of said Corporation to be held at The Peabody
Hotel, 149 Union Avenue, Memphis, Tennessee on Monday, September 26, 1994, and
at any adjournments thereof, on Items 1 through 3 as specified on the reverse
side hereof (with discretionary authority under Item 1 to vote for a new nominee
if any nominee has become unavailable) and on such other matters as may properly
come before said meeting.
Election of Class II Directors. Nominees:
Ralph D. DeNunzio
Charles T. Manatt
Jackson W. Smart, Jr.
Joshua I. Smith
COMMENTS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(If you have written in the above space, please mark the corresponding box on
the reverse side of this card.)
You are encouraged to specify your choices by marking the appropriate boxes, See
Reverse Side, but you need not mark any boxes if you wish to vote in accordance
with the Board of Directors' recommendations. Mr. Masterson and Mr. Razzouk
cannot vote your shares unless you sign and return this card.
SEE REVERSE SIDE
<PAGE>
/X/ PLEASE MARK YOUR VOTES AS IN THIS EXAMPLE. 6169
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN.
IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR ELECTION OF THE CLASS II
DIRECTORS AND FOR PROPOSALS 2 AND 3.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ITEMS 1-3.
1. Election of Class II Directors.
FOR / / WITHHELD / /
For, except vote withheld from the following nominee(s):
- --------------------------------------------------------
2. Approval of Amendment to Certificate of Incorporation to increase
Authorized Shares.
FOR / / AGAINST / / ABSTAIN / /
3. Approval of Independent Accountants.
Comments on Reverse Side / /
I request my name be disclosed with my vote and comments, if any. / /
The signer hereby revokes all proxies heretofore given by the signer to vote at
said meeting or any adjournments thereof.
NOTE: Please sign exactly as name appears on this card. Joint owners should
each sign. When signing as attorney, executor, administrator, trustee
or guardian, please give full title as such.
- -------------------------------------------------
- -------------------------------------------------
SIGNATURE(S) DATE
