EXHIBIT 1.b
EXECUTION COPY
FEDERAL EXPRESS CORPORATION
1996 Pass Through Certificates, Series A1
1996 Pass Through Certificates, Series A2
UNDERWRITING AGREEMENT
June 5, 1996
GOLDMAN, SACHS & CO.
J.P. MORGAN SECURITIES INC.
MORGAN STANLEY & CO. INCORPORATED
c/o GOLDMAN, SACHS & CO.
85 Broad Street
New York, New York 10004
Ladies and Gentlemen:
Federal Express Corporation, a Delaware corporation (the
"Company"), proposes that State Street Bank and Trust Company, acting not in
its individual capacity but solely as pass through trustee (the "Trustee")
under the Pass Through Trust Agreement dated as of February 1, 1993, as
amended and restated as of October 1, 1995 (the "Basic Agreement"), as
supplemented for each series of pass through certificates (the "Pass Through
Certificates") to be purchased hereunder (each, a "Series") by a Series
Supplement (each, a "Series Supplement"), in each case between the Company and
the Trustee (for each Series, the Basic Agreement, as supplemented by the
related Series Supplement, being referred to herein as the "Pass Through
Agreement"), issue and sell to the underwriters named in Schedule I hereto its
Pass Through Certificates in the aggregate amounts and with the applicable
interest rates and final distribution dates set forth on Exhibit A hereto (the
"Offered Certificates") on the terms and conditions stated herein and in
Schedule II.
Each Series of Pass Through Certificates will represent
interests in a separate trust (each, a "Pass Through Trust") established
pursuant to the related Pass Through Agreement to fund the purchase of
equipment trust certificates (the "Equipment Certificates") which are to be
issued as nonrecourse obligations by certain owner trustees, each acting
not in its individual capacity but solely as owner trustee (each, an "Owner
Trustee"), in connection with separate leveraged lease transactions entered
into or to be entered into by the Company relating to one McDonnell Douglas
MD-11F aircraft and two Airbus A300F4-605R aircraft (each, an "Aircraft"
and, collectively, the "Aircraft"). The proceeds from the sale of the
Equipment Certificates will be used to (i) finance a portion of the
purchase price to be paid by the Owner Trustee on behalf of the related
Owner Trust (or, in certain circumstances, by the Company) for one Aircraft
bearing U.S. Registration Mark N669FE, unless the manufacturer fails to
deliver such Aircraft by September 30, 1996, and (ii) refinance the
aggregate outstanding principal amount of the Original Loan Certificates of
the related Owner Trust issued in connection with separate leveraged lease
transactions relating to two Aircraft bearing U.S. Registration Marks
N1751A and N668FE, respectively. Each series of Equipment Certificates
will be issued under a separate Trust Indenture and Security Agreement
between State Street Bank and Trust Company, acting not in its individual
capacity, but solely as Indenture Trustee (the "Indenture Trustee"), and
the related Owner Trustee (each, an "Indenture" and, collectively, the
"Indentures"). As used herein, unless the context otherwise requires, the
term "Underwriters" shall mean the firm or firms named as Underwriter or
Underwriters in Schedule I and the term "you" shall mean the Underwriter or
Underwriters, if no underwriting syndicate is purchasing the Offered
Certificates, or the representative or representatives of the Underwriters,
if an underwriting syndicate is purchasing the Offered Certificates, as
indicated in Schedule I.
The Company has filed with the Securities and Exchange Commission
(the "Commission") a registration statement on Form S-3 (No. 33-56569), as
amended by Post-Effective Amendment No. 1 thereto, for the registration of
certain equipment trust certificates and pass through certificates, including
the Offered Certificates, under the Securities Act of 1933, as amended (the
"1933 Act"), and the offering thereof from time to time in accordance with
Rule 415 of the rules and regulations of the Commission under the 1933 Act
(the "1933 Act Regulations"). Such registration statement, as amended by
Post-Effective Amendment No. 1 thereto, has been declared effective by the
Commission and the Basic Agreement has been qualified under the Trust
Indenture Act of 1939, as amended (the "1939 Act"). The Company has, pursuant
to Rule 424 under the 1933 Act, filed with, or transmitted for filing to, or
shall within the required period of time hereafter file with or transmit for
filing to, the Commission a prospectus supplement (the "Prospectus
Supplement") specifically relating to the Offered Certificates, together with
a revised and restated prospectus relating to pass through certificates
covered by the above-referenced registration statement. The term
"Registration Statement" refers to such registration statement, as amended by
Post-Effective Amendment No. 1 thereto, in the form in which it became
effective, including the exhibits thereto and the documents incorporated by
reference therein, as amended to the date hereof. The term "Basic Prospectus"
means the above-referenced revised and restated prospectus relating to pass
through certificates. The term "Prospectus" means the Basic Prospectus
supplemented by the Prospectus Supplement. The term "Preliminary Prospectus"
means a preliminary prospectus supplement specifically relating to the Offered
Certificates together with the Basic Prospectus. As used herein, the terms
"Basic Prospectus," "Prospectus" and "Preliminary Prospectus" shall include in
each case the documents, if any, incorporated by reference therein. The terms
"supplement" and "amendment" or "amend" as used herein shall include all
documents deemed to be incorporated by reference in the Prospectus that have
been filed subsequent to the date of the Basic Prospectus by the Company with
the Commission pursuant to the Securities Exchange Act of 1934, as amended
(the "1934 Act").
Capitalized terms used but not otherwise defined in this
Agreement shall have the meanings specified in or pursuant to the Pass Through
Agreement or the Indenture relating to each related series of Equipment
Certificates.
SECTION 1. Representations and Warranties of the Company.
(a) The Company represents and warrants to you and to each
Underwriter named in Schedule I, as of the date hereof, as follows:
(i) Due Incorporation and Qualification. The Company has been
duly incorporated and is validly existing as a corporation in good
standing under the laws of the State of Delaware, is a "citizen of the
United States" within the meaning of Section 40102(a)(15) of Title 49 of
the United States Code, as amended (the "Transportation Code"), holding
an air operating certificate issued by the Secretary of Transportation
pursuant to Chapter 447 of the Transportation Code for aircraft capable
of carrying 10 or more individuals or 6,000 or more pounds of cargo, has
the corporate power and authority to own, lease and operate its
properties and to conduct its business as described in the Prospectus;
and the Company is duly qualified as a foreign corporation to transact
business and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing
of property or the conduct of business, except where the failure to so
qualify would not have a material adverse effect on the condition,
financial or otherwise, or the earnings, business affairs or business
prospects of the Company and its subsidiaries considered as one
enterprise.
(ii) Subsidiaries. Each subsidiary of the Company which is a
significant subsidiary as defined in Rule 405 of Regulation C of the
1933 Act Regulations (each a "Significant Subsidiary") has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of the jurisdiction of its incorporation, has corporate
power and authority to own, lease and operate its properties and to
conduct its business as described in the Prospectus and is duly
qualified as a foreign corporation to transact business and is in good
standing in each jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or the conduct
of business, except where the failure to so qualify would not have a
material adverse effect on the condition, financial or otherwise, or the
earnings, business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise; and all of the issued and
outstanding capital stock of each Significant Subsidiary has been duly
authorized and validly issued, is fully paid and non-assessable and,
except for directors' qualifying shares (except as otherwise stated in
the Registration Statement), is owned by the Company, directly or
through subsidiaries, free and clear of any security interest, mortgage,
pledge, lien, encumbrance, claim or equity.
(iii) Registration Statement and Prospectus. At the time the
Registration Statement became effective, the Registration Statement
complied, and as of the date hereof does comply, in all material
respects with the requirements of the 1933 Act and the 1933 Act
Regulations and the 1939 Act and the rules and regulations of the
Commission promulgated thereunder. The Registration Statement, at the
time it became effective, did not, and at each time thereafter at which
any amendment to the Registration Statement becomes effective and any
Annual Report on Form 10-K is filed by the Company with the Commission,
will not, contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make
the statements therein not misleading. The Prospectus, as of the date
hereof, does not contain an untrue statement of a material fact or omit
to state a material fact necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading; provided, however, that the representations and warranties
in this subsection shall not apply to statements in or omissions from
the Registration Statement or Prospectus made in reliance upon and in
conformity with information furnished to the Company in writing by an
Underwriter expressly for use in the Registration Statement or
Prospectus or to those parts of the Registration Statement which
constitute Statements of Eligibility and Qualification of Trustees (Form
T-1) under the 1939 Act. No stop order suspending the effectiveness of
the Registration Statement has been issued and no proceedings for that
purpose have been initiated or threatened by the Commission.
(iv) Incorporated Documents. The documents incorporated by
reference in the Prospectus, at the time they were or hereafter are
filed with the Commission, complied and will comply in all material
respects with the requirements of the 1934 Act and the rules and
regulations promulgated thereunder (the "1934 Act Regulations"), and,
when read together and with the other information in the Prospectus, did
not and will not contain an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary in
order to make the statements therein, in light of the circumstances
under which they were or are made, not misleading.
(v) Accountants. The accountants who certified the financial
statements included or incorporated by reference in the Prospectus are
independent public accountants as required by the 1933 Act and the 1933
Act Regulations.
(vi) Financial Statements. The financial statements of the
Company included or incorporated by reference in the Prospectus and the
Registration Statement present fairly the financial position of the
Company as of the dates thereof and the results of operations, changes
in common stockholders' investment and cash flows of the Company, for
the respective periods covered thereby, all in conformity with generally
accepted accounting principles applied on a consistent basis throughout
the entire period involved; and the financial schedules included or
incorporated by reference in the Registration Statement meet the
requirements of the 1933 Act Regulations or the 1934 Act Regulations, as
applicable, and accurately present the information required to be shown
therein.
(vii) Material Changes or Material Transactions. Except as
stated in the Prospectus, subsequent to the respective dates as of which
information is given in the Registration Statement and the Prospectus,
the Company has not incurred any liabilities or obligations, direct or
contingent, or entered into any transactions which are material to the
Company, and there has not been any material change in the capital stock
or short-term debt, or any material increase in long-term debt of the
Company, or any material adverse change, or any development involving a
prospective material adverse change, in the condition (financial or
other), business, prospects, net worth or results of operations of the
Company.
(viii) No Defaults; Regulatory Approvals. Neither the Company nor
any of its subsidiaries is in violation of its charter or in default in
the performance or observance of any material obligation, agreement,
covenant or condition contained in any contract, indenture, mortgage,
loan agreement, note, lease or other instrument to which it is a party
or by which it or any of them or their properties may be bound; and the
execution and delivery of this Agreement, each Pass Through Agreement
and the other Operative Agreements to which the Company is or is to be a
party and the consummation of the transactions contemplated herein and
therein have been duly authorized by all necessary corporate action and
will not conflict with or constitute a breach of, or default under, or
result in the creation or imposition of any lien (other than as
permitted under the Leases), charge or encumbrance upon any property or
assets of the Company or any of its subsidiaries pursuant to, any
contract, indenture, mortgage, loan agreement, note, lease or other
instrument to which the Company or any such subsidiary is a party or by
which it or any of them may be bound or to which any of the property or
assets of the Company or any such subsidiary is subject, which conflict,
breach or default would have, individually or in the aggregate with any
other such instances, a material adverse effect on the condition
(financial or other), business, prospects, net worth or results of
operations of the Company and its subsidiaries considered as one entity,
nor will such action result in any violation of the provisions of the
charter or by-laws of the Company or any law, administrative regulation
or administrative or court order or decree currently in effect or in
effect at the time of execution and delivery of this Agreement, each
Pass Through Agreement and the other Operative Agreements and
applicable to the Company or any of its subsidiaries; and no consent,
approval, authorization, order or decree of any court or governmental
agency or body is required for the consummation by the Company of the
transactions contemplated by this Agreement, any Pass Through
Agreement or any other Operative Agreement to which the Company is or
is to be a party, except such as may be required under the 1933 Act,
the 1939 Act, the 1933 Act Regulations or state securities or Blue
Sky laws, the Transportation Code, and the Uniform Commercial Code as
in effect in Delaware and Tennessee.
(ix) Legal Proceedings; Contracts. Except for matters described
in the Prospectus (as to which the Company can express no opinion at
this time concerning the Company's liability (if any) or the effect of
any adverse determination upon the business, condition (financial or
otherwise) or operations of the Company), there is no pending, or to the
best knowledge of any financial officer of the Company, threatened
action or proceeding before any court or administrative agency which
individually (or in the aggregate in the case of any group of related
lawsuits) is expected to have a material adverse effect on the financial
condition of the Company or the ability of the Company to perform its
obligations under the Pass Through Agreements and the other Operative
Agreements to which the Company is a party; and there are no contracts
or documents of the Company or any of its subsidiaries which are
required to be filed as exhibits to the Registration Statement by the
1933 Act or by the 1933 Act Regulations which have not been so filed.
(x) Compliance with Laws. The Company's business and
operations comply in all material respects with all laws and regulations
applicable thereto and there are no known, proposed or threatened
changes in any laws or regulations which would have a material adverse
effect on the Company or the manner in which it conducts its business;
the Company possesses all valid and effective certificates, licenses and
permits required to conduct its business as now conducted, except for
instances which individually or in the aggregate do not, or will not,
have a material adverse effect on the condition (financial or other),
business, prospects, net worth or results of operations of the Company.
(xi) Enforceability of Operative Agreements. Each of the Pass
Through Agreements and the other Operative Agreements to which the
Company is or is to be a party have been duly authorized by the Company,
will each be substantially in the form heretofore supplied to you and,
when duly executed and delivered by the Company and the other parties
thereto, will each constitute a valid and binding obligation of the
Company, enforceable against the Company in accordance with its terms.
The Basic Agreement as executed is substantially in the form filed as an
exhibit to the Registration Statement and has been duly qualified under
the 1939 Act.
(xii) Validity of the Offered Certificates. When executed,
issued, authenticated and delivered pursuant to the provisions of the
applicable Pass Through Agreement and sold and paid for as provided in
this Agreement, each Series of Offered Certificates will constitute
valid and legally binding obligations of the Trustee enforceable in
accordance with their terms; and the Certificateholders of such Offered
Certificates will be entitled to the benefits provided by such Pass
Through Agreement.
(xiii) Equipment Certificates. The Equipment Certificates to be
issued under each applicable Indenture, when duly executed and delivered
by the related Owner Trustee and duly authenticated by the Indenture
Trustee in accordance with the terms of such Indenture, will be duly
issued under such Indenture and will constitute the valid and binding
obligations of such Owner Trustee, and the Holders thereof will be
entitled to the benefits of such Indenture.
(xiv) Due Execution. This Agreement has been duly executed and
delivered by the Company.
(xv) Descriptions. The Offered Certificates, Pass Through
Agreements, Indentures, Participation Agreements, Leases and other
Operative Agreements conform, or will upon execution conform, in all
material respects to the descriptions thereof in the Prospectus.
The representations and warranties made by the Company as to the
enforceability of the Pass Through Agreements, the Indentures, the Offered
Certificates, the Equipment Certificates and the other Operative Agreements
set forth in subparagraphs (xi), (xii) and (xiii) above are limited by
bankruptcy, insolvency, reorganization and other laws of general applicability
relating to or affecting enforcement of creditors' rights or by general equity
principles, and the enforceability of any Pass Through Agreement, Lease and
Indenture is also limited by applicable laws which may affect the remedies
provided therein but which do not affect the validity of such Pass Through
Agreement, Lease or Indenture or make such remedies inadequate for the
practical realization of the benefits intended to be provided thereby.
(b) Additional Certifications. Any certificate signed by any
officer of the Company and delivered to you or to counsel for the
Underwriters in connection with an offering of the Offered Certificates
shall be deemed a representation and warranty by the Company to each
Underwriter participating in such offering as to the matters covered
thereby on the date of such certificate and unless subsequently amended or
supplemented subsequent thereto.
SECTION 2. Purchase and Sale.
(a) On the basis of the representations and warranties herein
contained and subject to the terms and conditions set forth herein and in
Schedule II, if any, the Company agrees to cause the Trustee to sell to each
Underwriter, and each Underwriter agrees, severally and not jointly, to
purchase from the Trustee, at the purchase price specified in Exhibit A
hereto, the respective amounts of each Series of Offered Certificates set
forth opposite the name of such Underwriter in Schedule I. It is understood
that you propose to offer the Offered Certificates for sale to the public as
set forth in the Prospectus.
(b) Payment of the purchase price for any Offered Certificates
to be purchased by the Underwriters shall be made at either the Company's
offices in Memphis, Tennessee or the office of Davis Polk & Wardwell, 450
Lexington Avenue, New York, New York 10017, or at such other place as shall be
agreed upon by you and the Company, at 9:00 A.M., New York City time, on the
fourth business day (unless postponed in accordance with the provisions of
Section 10) following the date hereof or at such other date, time or location
specified in Schedule II, or as otherwise shall be agreed upon by you and the
Company (such time and date being referred to as a "Closing Time"). Delivery
of the Offered Certificates shall be made for your account as specified in
Schedule II against payment by you of the purchase price thereof to, or upon
the order of, the Trustee (or such other person as the Company may direct) by
wire transfer of federal funds or other immediately available funds. Unless
otherwise indicated on Schedule II, such Offered Certificates shall be
registered in the name of Cede & Co., as nominee for The Depository Trust
Company, and in such denominations, as you may request in writing at least one
business day prior to the Closing Time. Such Offered Certificates, which may
be in temporary form, will be made available for examination and packaging by
you in New York, New York, on or before the first business day prior to the
Closing Time or at such other time and place specified in Schedule II.
(c) As compensation to you for your commitments and obligations
hereunder in respect of the Offered Certificates, including your undertakings
to distribute Offered Certificates, the Company will pay (or cause to be paid)
to you an amount equal to that percentage of the aggregate amount of each
series of Offered Certificates purchased by you as set forth in Exhibit A as
the underwriting discounts and commissions. Such payment shall be made
simultaneously with the payment by you to the Trustee of the purchase price of
the Offered Certificates as specified in Section 2(b) hereof. Payment of such
compensation shall be made by wire transfer of federal or other immediately
available funds.
SECTION 3. Covenants of the Company.
The Company covenants with each of you, and with each Underwriter
participating in the offering as follows:
(a) Prospectus Supplement. The Company has prepared a
Preliminary Prospectus containing such information as you and the Company have
deemed appropriate, and immediately following the execution of this Agreement,
the Company will prepare a Prospectus Supplement setting forth such
information as you and the Company deem appropriate in connection with the
offering of the Offered Certificates. The Company will promptly transmit
copies of the Prospectus Supplement to the Commission for filing pursuant to
Rule 424 of the 1933 Act Regulations.
(b) Notice of Certain Events. The Company will notify you
immediately (i) of the effectiveness of any amendment to the Registration
Statement, (ii) of the transmittal to the Commission for filing of any
supplement to the Prospectus or any document to be filed pursuant to the 1934
Act which will be incorporated by reference in the Prospectus, (iii) of the
receipt of any comments from the Commission with respect to the Registration
Statement, the Prospectus or the Prospectus Supplement relating in any way to
the offer and sale of the Offered Certificates, (iv) of any request by the
Commission for any amendment to the Registration Statement or any amendment or
supplement to the Prospectus or for additional information, and (v) of the
issuance by the Commission of any stop order suspending the effectiveness of
the Registration Statement or the initiation of any proceedings for that
purpose. The Company will make every reasonable effort to prevent the
issuance of any stop order and, if any stop order is issued, to obtain the
lifting thereof at the earliest possible moment.
(c) Notice of Certain Proposed Filings. The Company will give
you notice of its intention to file or prepare any amendment to the
Registration Statement or any amendment or supplement to the Prospectus,
whether by the filing of documents pursuant to the 1934 Act, the 1933 Act or
otherwise, and will furnish you with copies of any such amendment or
supplement or other documents proposed to be filed or prepared a reasonable
time in advance of such proposed filing or preparation, as the case may be.
(d) Copies of the Registration Statement and the Prospectus.
The Company will deliver to you as many signed and conformed copies of the
Registration Statement (as originally filed) and of each amendment thereto
(including exhibits filed therewith or incorporated by reference therein and
documents incorporated by reference in the Prospectus) as you may reasonably
request. The Company will furnish to you as many copies of the Prospectus (as
amended or supplemented) as you shall reasonably request so long as you are
required to deliver a Prospectus in connection with sales or solicitations of
offers to purchase the Offered Certificates.
(e) Revisions of Prospectus -- Material Changes. If at any
time when the Prospectus is required by the 1933 Act to be delivered in
connection with sales of the Offered Certificates any event shall occur or
condition exist as a result of which it is necessary, in the reasonable
opinion of counsel for the Underwriters or counsel for the Company, to further
amend or supplement the Prospectus in order that the Prospectus will not
include an untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements therein not misleading in the
light of the circumstances existing at the time it is delivered to a
purchaser, or if it shall be necessary, in the reasonable opinion of such
counsel, at any such time to amend or supplement the Registration Statement or
the Prospectus in order to comply with the requirements of the 1933 Act or the
1933 Act Regulations the Company will promptly prepare and file with the
Commission such amendment or supplement, whether by filing documents pursuant
to the 1934 Act, the 1933 Act or otherwise, as may be necessary to correct
such untrue statement or omission or to make the Registration Statement and
Prospectus comply with such requirements.
(f) Earnings Statements. The Company will make generally
available to its security holders as soon as practicable, but not later than
90 days after the close of the period covered thereby, an earnings statement
(in form complying with the provisions of Rule 158 under the 1933 Act)
covering each twelve-month period beginning, in each case, not later than the
first day of the Company's fiscal quarter next following the "effective date"
(as defined in such Rule 158) of the Registration Statement with respect to
each sale of Offered Certificates.
(g) Blue Sky Qualifications. The Company will endeavor, in
cooperation with you, to qualify the Offered Certificates for offering and
sale under the applicable securities laws of such states and other
jurisdictions of the United States as the Underwriters may designate, and will
maintain such qualifications in effect for so long as may be required for the
distribution of the Offered Certificates; provided, however, that the Company
shall not be obligated to file any general consent to service of process or to
qualify as a foreign corporation or to subject itself to taxation as doing
business in any jurisdiction in which it is not otherwise required to be so
qualified. The Company will file such statements and reports as may be
required by the laws of each jurisdiction in which the Offered Certificates
have been qualified as provided above.
(h) 1934 Act Filings. The Company, during the period when the
Prospectus is required to be delivered under the 1933 Act, will file promptly
all documents required to be filed with the Commission pursuant to Section
13(a), 13(c), 14 or 15(d) of the 1934 Act.
(i) Stand-Off Agreement. The Company will not, between the
date of this Agreement and termination of any trading restrictions with
respect to the Offered Certificates or the Closing Time, whichever is later,
(i) without your prior written consent, offer or sell, or enter into any
agreement to sell, any debt securities of the Company pursuant to a public
offering of securities registered under the 1933 Act (other than the Offered
Certificates which are to be sold pursuant hereto and commercial paper in the
ordinary course of business), (ii) offer or sell, or enter into any agreement
to sell, any equipment notes, pass through certificates, equipment trust
certificates or equipment purchase certificates secured by aircraft owned or
leased by the Company (or rights relating thereto) unless the Company has
provided the Underwriters at least three business days' notice thereof, or
(iii) as may otherwise be provided in Schedule II.
SECTION 4. Payment of Expenses.
The Company will pay all expenses incident to the performance of
its obligations under this Agreement, including:
(i) the preparation and filing of the Registration Statement
and all amendments thereto, the Preliminary Prospectus and the
Prospectus and any amendments or supplements thereto;
(ii) the preparation and filing of this Agreement;
(iii) the preparation, issuance and delivery of the Offered
Certificates;
(iv) the reasonable fees and disbursements of the Company's
accountants and counsel, of the Trustee, the Owner Trustees and the
Indenture Trustees and their respective counsel, and of any registrar,
paying agent and authenticating agent;
(v) the qualification of the Offered Certificates under
securities laws in accordance with the provisions of Section 3(g),
including filing fees and the reasonable fees and disbursements of
counsel to the Underwriters in connection therewith and in connection
with the preparation of any Blue Sky Survey and any Legal Investment
Survey;
(vi) the printing and delivery to the Underwriters in quantities
as hereinabove stated of copies of the Registration Statement and any
amendments thereto, and of the Prospectus and any amendments or
supplements thereto, and the delivery by the Underwriters of the
Prospectus and any amendments or supplements thereto in connection with
solicitations or confirmations of sales of the Offered Certificates;
(vii) the preparation and delivery to the Underwriters of copies
of the Pass Through Agreements and the other Operative Agreements,
including all expenses incident to the performance of the Company's
obligations under the Pass Through Agreements, Participation Agreements,
Indentures, Leases and each of the other agreements and instruments
referred to in the Indentures and Participation Agreements.
(viii)any fees charged by rating agencies for the rating of the
Offered Certificates; and
(ix) certain fees and disbursements of your counsel, as
heretofore agreed.
If this Agreement is terminated by you in accordance with the
provisions of Section 5 or clause (i) of Section 9 hereof, the Company shall
reimburse upon demand the Underwriters for all of their out-of-pocket
expenses, including the reasonable fees and disbursements of counsel for the
Underwriters that shall have been incurred by you in connection with the
proposed purchase and sale of the Offered Certificates.
SECTION 5. Conditions of Underwriters' Obligations.
The several obligations of the Underwriters to purchase the
Offered Certificates pursuant to this Agreement will be subject at all times
to the accuracy of the representations and warranties on the part of the
Company herein, to the accuracy of the statements of the Company's officers
made in any certificate furnished pursuant to the provisions hereof, to the
performance and observance by the Company of all covenants and agreements
contained herein, or in Schedule II hereto, on its part to be performed and
observed and to the following additional conditions precedent:
(a) Stop Order; Ratings Change; etc. At the Closing Time, (i)
no stop order suspending the effectiveness of the Registration Statement shall
have been issued under the 1933 Act or proceedings therefor initiated or
threatened by the Commission, (ii) the rating assigned as of the date of this
Agreement by any "nationally recognized statistical rating organization," as
such term is defined for purposes of Rule 436(g) under the 1933 Act
Regulations, to any debt securities of the Company (including for purposes of
this Section 5(a)(ii) any rating indicated by the Company as of the date of
this Agreement as the rating orally confirmed to the Company by any such
rating organization as the rating to be assigned to the Offered Certificates)
shall not have been lowered since the execution of this Agreement nor shall
any such rating organization have publicly announced that it has placed any
debt securities of the Company on what is commonly termed a "watch list" for
possible downgrading, and (iii) there shall not have come to your attention
any facts that would cause you to believe that the Prospectus, including the
Prospectus Supplement, at the time it was required to be delivered to a
purchaser of the Offered Certificates, contained an untrue statement of a
material fact or omitted to state a material fact necessary in order to make
the statements therein, in light of the circumstances existing at such time,
not misleading.
(b) Legal Opinions. At the Closing Time, you shall have
received the following documents:
(1) Opinion of Special Counsel to the Company. The opinion of
Davis Polk & Wardwell, special counsel to the Company, dated as of such
date, in form and substance satisfactory to you, to the effect set forth
in Exhibit B and the opinions of such counsel required to be delivered
pursuant to each Participation Agreement, dated as of such date, in form
and substance satisfactory to you, to the effect set forth in Exhibits
C-1 and C-2.
(2) Opinion of Company Counsel. The opinion of the Executive
Vice President and General Counsel of the Company or any Vice President
in the Legal and Regulatory Division of the Company, dated as of such
date, in form and substance satisfactory to you, to the effect as set
forth in Exhibit D.
(3) Opinion of Counsel to the Underwriters. The opinion of
Vedder, Price, Kaufman & Kammholz, counsel to the Underwriters, with
respect to such matters as you may reasonably request.
(c) Officers' Certificate. At the Closing Time, there shall
not have been, since the respective dates as of which information is given in
the Registration Statement and the Prospectus, any material adverse change in
the condition (financial or otherwise) of the Company, or in the earnings,
business affairs or business prospects of the Company, whether or not arising
in the ordinary course of business; and you shall have received a certificate
of the Chief Executive Officer or any Executive Vice President and the Chief
Financial Officer, the Treasurer or the Controller of the Company, dated as of
the Closing Time, to the effect (i) that there has been no such material
adverse change, (ii) that the other representations and warranties of the
Company contained in Section 1 are true and correct with the same force and
effect as though expressly made at and as of the date of such certificate,
except to the extent that such representations and warranties expressly relate
to an earlier date or later date (in which case such representations and
warranties are true and correct on and as of such earlier date or will be true
and correct on and as of such later date, as the case may be), (iii) that the
Company has made or caused to be made any required filing of the Prospectus
pursuant to Rule 424(b) in the manner and within the time period required by
Rule 424(b), and (iv) that the Company has complied with all agreements and
satisfied all conditions on its part to be performed or satisfied at or prior
to the date of such certificate.
(d) Comfort Letter. At the time of the execution of this
Agreement and at the Closing Time, you shall have received a letter from
Arthur Andersen LLP or their successors as the Company's independent
accountants (the "Independent Accountants"), dated as of the date hereof and
of the Closing Time, as the case may be, in form and substance satisfactory to
you to the effect that:
(i) they are independent public accountants within the meaning
of the 1933 Act and the 1933 Act Regulations;
(ii) in their opinion the Company's financial statements and
schedules included or incorporated by reference in the Registration
Statement and Prospectus and covered by their reports included or
incorporated therein comply as to form in all material respects with the
applicable accounting requirements of the 1933 Act and the 1933 Act
Regulations or the 1934 Act and the 1934 Act Regulations, as the case
may be;
(iii) they have conducted reviews of the unaudited interim
consolidated financial information of the Company included in the
Company's Quarterly Reports on Form 10-Q incorporated in the
Registration Statement and Prospectus in compliance with the standards
for such reviews promulgated by the American Institute of Certified
Public Accountants;
(iv) on the basis of a reading of the financial statements and
schedules of the Company included or incorporated in the Prospectus and
the Registration Statement, and the latest available unaudited interim
financial statements of the Company, inquiries of officials of the
Company responsible for financial and accounting matters, a reading of
the minute books of the Company, and other specified procedures and
inquiries, nothing has come to their attention that caused them to
believe that:
(A) the unaudited financial statements of the Company
included or incorporated in the Prospectus and the Registration
Statement do not comply as to form in all material respects with
the applicable accounting requirements of the 1933 Act and the
1933 Act Regulations or the 1934 Act and the 1934 Act Regulations
thereunder, as the case may be, or that such unaudited financial
statements are not presented fairly in conformity with generally
accepted accounting principles;
(B) with respect to the period subsequent to the date of
the most recent financial statements incorporated in the
Registration Statement and the Prospectus, as of a specified date
not more than five business days prior to the date of delivery of
such letter, there has been any change in the common or preferred
stock or long-term debt of the Company or, as of such date, there
has been any decrease in assets or common stockholders'
investment, in each case as compared with amounts shown in the
most recent consolidated balance sheet of the Company included or
incorporated in the Registration Statement and the Prospectus,
except in each case for changes or decreases which the Prospectus
discloses have occurred or may occur or which are described in
such letter; or
(C) for the period from the date of the most recent
financial statements incorporated in the Registration Statement
and the Prospectus to such specified date, there was any decrease
in operating revenues, operating income, income before taxes or
net income of the Company in each case as compared with the
comparable period of the preceding year, except in each case for
decreases which the Prospectus discloses have occurred or may
occur or which are described in such letter; and
(v) in addition to their audit referred to in their reports
included or incorporated by reference in the Registration Statement and
the Prospectus and the reviews, inquiries and procedures referred to in
clauses (iii) and (iv) above, such letter shall state that Arthur
Andersen LLP has performed other specified procedures, with respect to
certain numerical data and information included or incorporated in the
Registration Statement and the Prospectus, as are requested by an
Underwriter and specified in such letter and have found such data and
information to be in agreement with the accounting records of or
analyses prepared by the Company.
(e) Satisfaction of Conditions Precedent in Participation
Agreements. At the Closing Time, all conditions precedent specified in each
Participation Agreement with respect to the refunding or funding of the
related Equipment Certificates, as the case may be, shall have been satisfied;
the representations and warranties of the Company, the Owner Trustee, the Pass
Through Trustee and the Indenture Trustee contained in each of the
Participation Agreements shall be accurate as of the Closing Time (except to
the extent that they relate solely to an earlier date in which case they shall
be accurate as of such earlier date) and you shall have received certificates
of the Chief Financial Officer or the Treasurer of the Company and appropriate
officers of the respective Owner Trustees, Pass Through Trustees and Indenture
Trustees, dated as of the Closing Time, to such effect; and you shall have
received a copy of each opinion required to be delivered under each of the
Participation Agreements dated as of the Closing Time, and addressed to you,
and of such other documents furnished in connection with the fulfillment of
such conditions as you or your counsel may reasonably request.
(f) Other Documents. At the Closing Time, counsel for the
Underwriters shall have been furnished with such documents and opinions as
such counsel may reasonably require for the purpose of enabling such counsel
to pass upon the issuance and sale of Offered Certificates as herein
contemplated and related proceedings, or in order to evidence the accuracy and
completeness of any of the representations and warranties, or the fulfillment
of any of the conditions, herein contained; and all proceedings taken by the
Company in connection with the issuance and sale of Offered Certificates as
herein contemplated shall be satisfactory in form and substance to you and to
counsel for the Underwriters.
If any condition specified in this Section shall not have been fulfilled
when and as required to be fulfilled, this Agreement may be terminated by you
by notice to the Company at any time at or prior to the Closing Time, and such
termination shall be without liability of any party to any other party except
as provided in Section 4 hereof.
SECTION 6. Indemnification.
(a) The Company agrees to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within the
meaning of Section 15 of the 1933 Act as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, joint or several, as incurred, arising out of any
untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement (or any amendment thereto), or
the omission or alleged omission therefrom of a material fact required
to be stated therein or necessary to make the statements therein not
misleading or arising out of or based upon any untrue statement or
alleged untrue statement of a material fact contained in the Prospectus
(or any amendment or supplement thereto) or the omission or alleged
omission therefrom of a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, joint or several, as incurred, to the extent of the
aggregate amount paid in settlement of any litigation, or investigation
or proceeding by any governmental agency or body, commenced or
threatened, or of any claim whatsoever arising out of or based upon any
such untrue statement or omission, or any such alleged untrue statement
or omission, if such settlement is effected with the written consent of
the Company; and
(iii) against any and all expense whatsoever (including the fees
and disbursements of counsel chosen by you), joint or several, as
incurred, reasonably incurred in investigating, preparing or defending
against any litigation, or investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim
whatsoever arising out of or based upon any such untrue statement or
omission, or any such alleged untrue statement or omission, to the
extent that any such expense is not paid under (i) or (ii) above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by
any Underwriter expressly for use in the Registration Statement (or any
amendment thereto) or the Prospectus (or any amendment or supplement thereto),
or made in reliance upon the Statements of Eligibility and Qualification of
Trustees (Form T-1) under the 1939 Act filed as exhibits to the Registration
Statement; and provided, further, that the foregoing indemnity agreement, with
respect to any Preliminary Prospectus shall not inure to the benefit of any
Underwriter from whom the person asserting any such losses, claims, damages or
liabilities purchased Offered Certificates, or any person controlling such
Underwriter, if a copy of the Prospectus (as then amended or supplemented if
the Company shall have furnished any amendments or supplements thereto) was
not sent or given by or on behalf of such Underwriter to such person, if
required by law so to have been delivered, at or prior to the written
confirmation of the sale of the Offered Certificates to such person, and if
the Prospectus (as so amended or supplemented) would have cured the defect
giving rise to such losses, claims, damages or liabilities.
(b) Each Underwriter severally agrees to indemnify and hold
harmless the Company, its directors and officers and each person, if any, who
controls the Company within the meaning of Section 15 of the 1933 Act against
any and all loss, liability, claim, damage and expense described in the
indemnity contained in subsection (a) of this Section, as incurred, but only
with respect to untrue statements or omissions, or alleged untrue statements
or omissions, made in the Registration Statement (or any amendment thereto) or
the Prospectus (or any amendment or supplement thereto) in reliance upon and
in conformity with written information furnished to the Company by such
Underwriters through you expressly for use in the Registration Statement (or
any amendment thereto) or the Prospectus (or any amendment or supplement
thereto).
(c) Each indemnified party shall give prompt notice to each
indemnifying party of any action commenced against it in respect of which
indemnity may be sought hereunder, but failure to so notify an indemnifying
party shall not relieve such indemnifying party from any liability which it
may have otherwise than on account of this indemnity agreement. An
indemnifying party may participate at its own expense in the defense of such
action. In no event shall the indemnifying parties be liable for the fees and
expenses of more than one counsel (in addition to any local counsel) separate
from their own counsel for all indemnified parties in connection with any one
action or separate but similar or related actions in the same jurisdiction
arising out of the same general allegations or circumstances.
SECTION 7. Contribution.
In order to provide for just and equitable contribution in
circumstances in which the indemnity agreement provided for in Section 6 is
for any reason held to be unenforceable by the indemnified parties although
applicable in accordance with its terms, the Company and the Underwriters
of each offering of Offered Certificates shall contribute to the aggregate
losses, liabilities, claims, damages and expenses of the nature
contemplated by said indemnity agreement incurred by the Company and one or
more of the Underwriters in respect of such offering, as incurred, in such
proportions that the Underwriters are responsible for that portion
represented by the percentage that the underwriting discount appearing on
the cover page of the Prospectus in respect of such offering bears to the
initial public offering price appearing thereon and the Company is
responsible for the balance; provided, however, that no person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
1933 Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. For purposes of this Section,
each person, if any, who controls an Underwriter within the meaning of
Section 15 of the 1933 Act shall have the same rights to contribution as
such Underwriter, and each director of the Company, each officer of the
Company who signed the Registration Statement, and each person, if any, who
controls the Company within the meaning of Section 15 of the 1933 Act shall
have the same rights to contribution as the Company.
SECTION 8. Representations, Warranties and Agreements to Survive Delivery.
All representations, warranties and agreements contained in this
Agreement, or contained in certificates of officers of the Company submitted
pursuant hereto, shall remain operative and in full force and effect,
regardless of any investigation made by or on behalf of any Underwriter or
controlling person, or by or on behalf of the Company, and shall survive each
delivery of and payment for any of the Offered Certificates.
SECTION 9. Termination of Agreement.
You may also terminate this Agreement, immediately upon notice to
the Company, at any time prior to the Closing Time (i) if there has been,
since the date hereof or since the respective dates as of which information is
given in the Registration Statement, any material adverse change in the
condition, financial or otherwise, or in the earnings, business affairs or
business prospects of the Company, whether or not arising in the ordinary
course of business, or (ii) if there shall have occurred any material adverse
change in the financial markets in the United States or any outbreak or
escalation of hostilities or other national or international calamity or
crisis, the effect of which shall be such as to make it, in your judgment,
impracticable to market the Offered Certificates or enforce contracts for the
sale of the Offered Certificates, or (iii) if trading in any securities of the
Company shall have been suspended by the Commission or a national securities
exchange, or if trading generally on either the American Stock Exchange or the
New York Stock Exchange shall have been suspended, or minimum or maximum
prices for trading shall have been fixed, or maximum ranges for prices for
securities shall have been required, by either of said exchanges or by order
of the Commission or any other governmental authority, or if a banking
moratorium shall have been declared by either federal or New York authorities.
In the event of any termination of this Agreement, the covenant set forth in
Section 3(f) hereof, the provisions of Section 4 hereof, the indemnity and
contribution agreements set forth in Sections 6 and 7 hereof, and the
provisions of Sections 8 and 13 hereof shall remain in effect.
SECTION 10. Default by One of the Underwriters.
If either Underwriter shall fail at the Closing Time to purchase
the Offered Certificates which it is obligated to purchase hereunder (the
"Defaulted Certificates"), then the remaining Underwriter or any other
underwriters (the "Non-Defaulting Underwriters") shall have the right, but not
the obligation, within 24 hours thereafter, to make arrangements to purchase
all, but not less than all, of the Defaulted Certificates upon the terms
herein set forth; if, however, the Non-Defaulting Underwriters shall not have
completed such arrangements for the purchase of all of the Defaulted
Certificates within such 24-hour period, then this Agreement shall terminate
without liability on the part of the Non-Defaulting Underwriters.
No action taken pursuant to this Section shall relieve a
defaulting Underwriter from liability in respect of its default under this
Agreement.
In the event of any such default which does not result in a
termination of this Agreement, either the Non-Defaulting Underwriters or
the Company shall have the right to postpone the Closing Time for a period
not exceeding seven days in order to effect any required changes in the
Registration Statement or Prospectus or in any other documents or
arrangements.
SECTION 11. Notices.
All notices and other communications hereunder shall be in
writing and shall be deemed to have been duly given if mailed, delivered by
Federal Express service or transmitted by any facsimile communication.
Notices to the Underwriters shall be directed, on behalf of all of the
Underwriters, to Goldman, Sachs & Co., 85 Broad Street, New York, New York,
10004, Attention: Marcus Colwell, with copies thereof directed to Vedder,
Price, Kaufman & Kammholz, 222 North LaSalle Street, Chicago, Illinois 60601,
Attention: Jennifer R. Evans. Notices to the Company shall be directed to it
at 2007 Corporate Avenue, Memphis, Tennessee 38132 (if by Federal Express
service) or P.O. Box 727, Memphis, Tennessee 38194 (if by mail), Attention:
Vice President and Treasurer, with copies thereof directed to the Legal
Department of the Company at 1980 Nonconnah Drive, Memphis, Tennessee 38132
(if by Federal Express Service) or P.O. Box 727, Memphis, Tennessee 38194 (if
by mail), Attention: Managing Director - Securities and Corporate Law.
SECTION 12. Parties.
This Agreement shall inure to the benefit of and be binding upon
you and the Company and any Underwriter who becomes a party hereto and their
respective successors. Nothing expressed or mentioned in this Agreement is
intended or shall be construed to give any hereon, firm or corporation, other
than the parties hereto and their respective successors and the controlling
persons and officers and directors referred to in Sections 6 and 7 and their
heirs and legal representatives, any legal or equitable right, remedy or claim
under or in respect of this Agreement or any provision herein contained. This
Agreement and all conditions and provisions hereof are intended to be for the
sole and exclusive benefit of the parties hereto their respective successors
and said controlling persons and officers and directors and their heirs and
legal representatives, and for the benefit of no other person, firm or
corporation. No purchaser of Offered Certificates from any Underwriter shall
be deemed to be a successor by reason merely of such purchase.
SECTION 13. Governing Law.
This Agreement and the rights and obligations of the parties
created hereby and thereby shall be governed by and construed in accordance
with the laws of the State of New York applicable to agreements made and to be
performed in such state. Any suit, action or proceeding brought by the
Company against an Underwriter in connection with or arising under this
Agreement shall be brought solely in the state or federal court of appropriate
jurisdiction located in the Borough of Manhattan, The City of New York.
* * *
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof,
whereupon this instrument along with all counterparts will become a binding
agreement between you and the Company in accordance with its terms.
Very truly yours,
FEDERAL EXPRESS CORPORATION
By: /S/ ROBERT D. HENNING
--------------------------------
Name: Robert D. Henning
Title: Assistant Treasurer and Managing
Director, Structured Finance
CONFIRMED AND ACCEPTED, as of
the date first above written:
GOLDMAN, SACHS & CO.
J.P. MORGAN SECURITIES INC.
MORGAN STANLEY & CO. INCORPORATED
By: Goldman, Sachs & Co.
By: /S/ GOLDMAN, SACHS & CO.
-------------------------------
Name: Marcus Colwell
Title: Vice President
Acting on behalf of themselves and the
other named Underwriters
Exhibit A
FEDERAL EXPRESS CORPORATION
1996 Pass Through Certificates, Series A1
1996 Pass Through Certificates, Series A2
1996 Pass
Through Final Underwriting
Certificates Purchase Interest Distribution Aggregate Discounts and
Designation Price Rate Date Amounts Commissions
- ----------------- -------------------- ---------- -------------- --------------- ---------------
Series A1 $165,317,000 7.85% 1/30/2015 $165,317,000 0.65%
Series A2 24,607,000 8.17% 1/30/2018 24,607,000 0.65%
-------------------- ---------------
TOTAL $189,924,000 $189,924,000 $1,234,506
==================== ===============
Exhibit B
Opinion of Davis Polk & Wardwell,
Special Counsel for the Company
The opinion of Davis Polk & Wardwell, special counsel for the
Company, to be delivered pursuant to Section 5(b)(1) of the Underwriting
Agreement shall be to the effect that:
1. The Underwriting Agreement has been duly authorized,
executed and delivered by the Company.
2. The Registration Statement has become effective under the
1933 Act and the Basic Agreement has been duly qualified under the 1939 Act.
3. Although we are not aware of any judicial authority, none of
the Pass Through Trusts is required to be registered under the Investment
Company Act of 1940, as amended.
4. The Pass Through Trusts will not be classified as
associations taxable as corporations, but, rather, will be classified as
grantor trusts under subpart E, Part I of Subchapter J of the Internal Revenue
Code of 1986, as amended, and each person having a beneficial interest in a
Pass Through Certificate will be treated as the owner of a pro rata undivided
interest in each of the Equipment Certificates and any other property held in
the related Pass Through Trust. With respect to all other matters addressed
in the Basic Prospectus under the caption "Federal Income Tax Consequences,"
we are also of the opinions ascribed to us therein.
We have considered the matters required to be included in the
Registration Statement and the Prospectus and the information contained
therein. In our opinion (i) the statements in the Basic Prospectus under
the captions "Description of the Pass Through Certificates" and
"Description of the Equipment Certificates" and in the Prospectus
Supplement under the captions "Description of the Pass Through
Certificates" and "Description of the Equipment Trust Certificates,"
insofar as such statements constitute a summary of the Pass Through
Agreement, the Leases, the Participation Agreements and the Indentures,
fairly present the information called for by the 1933 Act and the 1933 Act
Regulations with respect thereto and fairly summarize the material
provisions thereof and (ii) the statements in the Basic Prospectus in the
fourth paragraph under the caption "Description of the Equipment
Certificates - Security" and in the Prospectus Supplement in the ninth
paragraph under the caption "Description of the Equipment Certificates -
Remedies," insofar as such statements constitute a description of Section
1110 of the Bankruptcy Code as such Section would be applicable to the
Equipment Certificates, fairly summarize the material provisions of such
Section as such Section would be applicable to the Equipment Certificates.
The Offered Certificates conform in all material respects to the summary
descriptions thereof contained in the Prospectus. We have not ourselves
checked the accuracy or completeness of, or otherwise verified, the
information furnished with respect to other matters in the Registration
Statement or the Prospectus. We have generally reviewed and discussed with
certain officers and employees of the Company, its independent public
accountants and your representatives and counsel the information furnished,
whether or not subject to our check and verification. On the basis of such
consideration, review and discussion, but without independent check or
verification, except as stated, (i) we are of the opinion that the
Registration Statement and the Prospectus (except for the financial
statements and other financial information set forth or incorporated by
reference therein, as to which we are not called upon to express any
opinion) comply as to form in all material respects with the 1933 Act and
the applicable 1933 Act Regulations and (ii) we have no reason to believe
that the Registration Statement and the prospectus included therein (except
for the financial statements and other financial information set forth or
incorporated by reference therein and the Statement of Eligibility and
Qualification (Form T-1) under the 1939 Act of State Street Bank and Trust
Company, as to all of which we are not called upon to express a belief) at
the time the Registration Statement became effective contained any untrue
statement of a material fact or omitted to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading, or that, as of the Closing Time, either the Registration
Statement or the Prospectus (except for the financial statements and other
financial information set forth or incorporated by reference therein, as to
which we are not called upon to express a belief), contains an untrue
statement of a material fact or omits to state a material fact necessary to
make the statements therein, in light of the circumstances in which they
were made, not misleading.
The foregoing opinions are subject to the following
qualifications:
(a) We are members of the Bar of the State of New York and the
foregoing opinions are limited to the laws of the State of New York, the
federal laws of the United States of America and the General Corporation Law
of the State of Delaware.
(b) We express no opinion as to the scope, effect or other
matters arising under the Transportation Code, or the rules and regulations
thereunder or as to matters involving filing and recording with the Federal
Aviation Administration.
(c) This opinion is issued solely to you in connection with the
above matter and may not be relied upon by you for any other purpose or relied
upon by or furnished to any other person without our prior written consent.
Exhibit C-1
[Letterhead of Davis Polk & Wardwell]
June __, 1996
To each of the Parties
named on the Schedule hereto
Ladies and Gentlemen:
We have acted as special counsel for Federal Express Corporation,
a Delaware corporation ("Federal Express"), in connection with the transaction
contemplated by the Participation Agreement (Federal Express Corporation Trust
No. [N582FE] [N668FE]), dated as of [April 1, 1996] [May 1, 1996], as amended
and restated as of June 1, 1996 (the "Participation Agreement") among Federal
Express, as Lessee, [Boatmen's Equipment Finance, Inc.] [PMCC Leasing
Corporation], as Owner Participant, the entities listed on Schedule I to the
Original Participation Agreement as Original Loan Participants, First Security
Bank of Utah, National Association, as Owner Trustee, State Street Bank and
Trust Company, as Indenture Trustee and State Street Bank and Trust Company,
as Pass Through Trustee. Unless otherwise defined herein, capitalized terms
used herein shall have the meanings assigned thereto in the Participation
Agreement. This opinion is being delivered pursuant to Section 4.01(l)(viii)
of the Participation Agreement. Capitalized terms not otherwise defined
herein have the meanings assigned thereto in the Participation Agreement.
Pursuant to the Original Participation Agreement, the Owner
Participant and the Original Loan Participants participated in the payment of
the Purchase Price of [one McDonnell Douglas MD-11F Aircraft] [one Airbus
A300F4-605R Aircraft] which was purchased by the Owner Trustee pursuant to
[the Bills of Sale] [AVSA's FAA Bill of Sale and the AVSA's Warranty Bill of
Sale], subjected to the Lien of the Original Indenture and leased to Federal
Express under the Original Lease. The Participation Agreement provides, among
other things, for the refinancing of the Original Loan Certificates using the
proceeds from the public offering of Pass Through Certificates. Two Series of
Pass Through Certificates will be issued by separate Pass Through Trusts, each
formed to acquire, among other securities, the Certificates bearing a
particular interest rate and having a particular Maturity that will be issued
under the Indenture.
In connection with the opinions expressed below, we have examined
executed counterparts of the Operative Agreements, the Pass Through
Certificates, the Pass Through Agreement and each Series Supplement (the
"Transaction Agreements"). We have also examined originals, or copies
certified to our satisfaction, of such other agreements, documents,
certificates and statements of governmental officials and corporate officers
as we have deemed necessary or advisable as a basis for such opinions. In
such examination, we have assumed the genuineness of all signatures and the
authenticity of all documents submitted to us as originals and the conformity
with the originals of all documents submitted to us as copies.
As to any facts material to our opinions expressed below, we have,
with your consent, relied on the representations and warranties made in or
pursuant to the Participation Agreement and the other documents referred to
therein, the accuracy of which we have not independently verified. In
addition, we have, when relevant facts were not independently established by
us, relied, to the extent we deemed such reliance proper, upon certificates of
public officials and certificates, telegrams and other written or oral
statements of officers of the parties referred to herein.
Based on the foregoing, it is our opinion that:
1. With respect to that portion, if any, of the Aircraft and
the other property included in the Lessor's Estate as may not be covered
by the recording system established by the FAA pursuant to Section 44107
of the Transportation Code, no filing or recording of any document or
other action was or is necessary in order to establish the Owner
Trustee's title thereto and interest therein as against Federal Express
and any third parties.
2. The Lease creates a valid leasehold interest in the
Aircraft, the entitlement thereof to the benefits of recordation under
the Transportation Code being subject to the due and timely filing and,
where appropriate, recording of (A) the Lease (with the Indenture
attached as an exhibit), (B) the Indenture and (C) the Trust Agreement.
3. The execution, delivery and performance of the Participation
Agreement, the Trust Agreement, the Indenture and the Lease by the Owner
Trustee in its individual or trust capacity, as the case may be, and the
issuance, execution, delivery and performance of the Certificates by the
Owner Trustee in its trust capacity do not violate, and fully comply
with, any laws and governmental rules and regulations of the State of
New York that may be applicable to the Owner Trustee in its individual
or trust capacity, as the case may be. The opinion set forth in this
paragraph 3 is rendered without regard to the effect, if any, on such
issuance (in the case of the Certificates), execution, delivery or
performance of the taking of any other action, the conduct of any other
business or the exercise of any other powers by FSBU, in its individual
or in a trust capacity, in the State of New York not related to the
transactions contemplated by the Transaction Agreements. We have
assumed that FSBU has made the filings necessary to comply with Section
131.3 of the Banking Law of the State of New York. However, we express
no opinion as to whether FSBU is required to comply with said Section
131.3.
4. (a) Each of the Transaction Agreements to which Federal
Express is a party has been duly authorized, executed and delivered by
Federal Express.
(b) The execution, delivery and performance by Federal
Express of each of the Transaction Agreements to which Federal
Express is a party do not violate, or did not on the date of
execution thereof, and fully comply, or did fully comply on the date
of execution thereof, with any laws and governmental rules and
regulations of the State of New York that may be applicable to
Federal Express. The opinion set forth in this paragraph 4(b) is
rendered without regard to the taking of any other action or the
conduct of any other business by Federal Express in the State of New
York other than the transactions contemplated by the Transaction
Agreements.
5. Assuming (i) the due authorization, execution and delivery
of the Transaction Agreements by each of the parties to each such
document (other than Federal Express), (ii) each such party has full
power and legal right to enter into and perform its respective
obligations under the Transaction Agreements, (iii) that the execution,
delivery and performance by each of the Transaction Agreements by each
of the parties thereto will not violate the respective parties'
constituent documents, (iv) the due authorization, execution, issuance
and delivery by the Owner Trustee, and the due authentication by the
Indenture Trustee, of the Certificates to be issued under the Indenture
in accordance with the terms of the Indenture, (v) that the Original
Loan Certificates are delivered by the Original Loan Participants to the
Indenture Trustee for cancellation and are cancelled, (vi) the due
authorization, execution, issuance, delivery and authentication by the
Pass Through Trustee of the Pass Through Certificates to be issued under
the Pass Through Agreement and the Series Supplement relating to such
Pass Through Certificates, in each case in accordance with the terms of
the Pass Through Agreement and such Series Supplement, and (vii) that
the form of each Transaction Agreement is in compliance with all
applicable laws and governmental rules and regulations (other than the
laws of the United States and the laws of the State of New York), then:
(A) to the extent governed by New York law, each Transaction Agreement
in form constitutes a legal, valid and binding agreement of each party
thereto enforceable against each such party in accordance with its
terms; (B) the Original Indenture created, and the Indenture creates,
for the benefit of the Holders the security interest in the Trust
Indenture Estate that they purport to create; (C) the Certificates, when
issued to and acquired by the Pass Through Trustee, will be legal, valid
and binding obligations of the Owner Trustee enforceable against the
Owner Trustee in accordance with their terms and the terms of the
Indenture and will be entitled to the benefits of the Indenture,
including the benefit of the security interest created thereby; (D) the
Pass Through Certificates, when issued to and acquired by the
Underwriters in accordance with the Underwriting Agreement, will be
legal, valid and binding obligations of the Pass Through Trustee
enforceable against the Pass Through Trustee in accordance with their
terms and will be entitled to the benefits of the Pass Through
Agreement and the Series Supplement relating thereto; and (E) the
beneficial interest of the Owner Participant under the Trust
Agreement in and to the properties which are part of the Trust
Indenture Estate is subject, to the extent provided in the Indenture,
to the Lien of the Indenture in favor of the Holders. The opinions
set forth in this paragraph 5 are subject to the due filing and,
where appropriate, recording with the FAA of the documents referred
to in paragraph 2 above.
6. All the properties which are part of the Trust Indenture
Estate (including all right, title and interest of the Owner Trustee
pledged and mortgaged by it pursuant to the Indenture in and to the
Aircraft and the Lease) have been pledged and mortgaged with the
Indenture Trustee as part of the Trust Indenture Estate (subject to the
due filing and, where appropriate, recording of those documents referred
to in paragraph 2 above and the financing statements referred to in
Section 4.01(f) of the Participation Agreement), and the beneficial
interest of the Owner Participant under the Trust Agreement in and to
such properties are subject, to the extent provided in the Indenture,
to the Lien of the Indenture in favor of the Holders of the Certificates
issued and to be issued under the Indenture.
7. The Indenture creates, as security for all of the
Certificates duly issued and to be issued under the Indenture, the first
priority security interest in the Aircraft it purports to create, the
perfection and rank thereof being subject to the registration with the
FAA of the Aircraft in the name of the Owner Trustee and the due filing
and, where appropriate, recording in accordance with the Transportation
Code of the documents referred to in paragraph 2 above. We express no
opinion with respect to the status of any security interest in any
portion of the Aircraft which does not constitute an "aircraft" or
"aircraft engine", as defined in paragraphs (6) and (7) of Section
40102(a) of the Transportation Code.
8. Federal Express' participation in the transactions
contemplated by the Transaction Agreements does not and will not
constitute a violation of Section 7 of the Securities Exchange Act of
1934.
9. Except for the fillings and recordings referred to in
paragraph 2 above, neither the execution and delivery by Federal Express
of the Participation Agreement or any other Transaction Agreement to
which it is a party, nor the consummation of any of the transactions by
Federal Express contemplated thereby, requires the consent or approval
of, the giving of notice to, or the registration with, or the taking of
any other action in respect of, the Department of Transportation, the
FAA, the Securities and Exchange Commission or any other Federal or New
York State governmental authority.
10. It is not necessary, in connection with the creation of the
beneficial interest of the Owner Participant of the Trust Indenture
Estate under the circumstances contemplated by the Participation
Agreement to register such beneficial interest under the Securities Act
of 1933, as amended, or to qualify the Trust Agreement under the Trust
Indenture Act of 1939, as amended.
11. The provisions of Section 1110 of the United States
Bankruptcy Code will apply to the Aircraft for the benefit of the
Lessor, as lessor under and by reason of the Lease. The Lease,
including the rights under Section 1110 of the United States Bankruptcy
Code, has been assigned to the Indenture Trustee pursuant to the
Indenture as part of the collateral for the Certificates and, as
assignee, the Indenture Trustee has the benefit of Section 1110.
The foregoing opinions are subject to the following
qualifications:
(a) We have relied, with your consent, without independent
investigation and verification and subject to the assumptions and
qualifications contained therein, upon the opinions of Daugherty, Fowler
& Peregrin and George W. Hearn, Vice President-Law of Federal Express to
be delivered to you and dated the date hereof, for purposes of the
matters covered thereby.
(b) We are qualified to practice law in the State of New York,
and we do not purport to be experts on, or to express any opinion herein
concerning, any laws other than the laws of the State of New York, the
laws of the United States and the General Corporation Law of the State
of Delaware. We express no opinion as to any matters involving aviation
law.
(c) The opinion contained in paragraph 5 above as to
enforceability is subject to (i) applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors' rights generally and (ii) general principles of equity which
may affect the remedies provided in the agreements referred to in said
opinions, which laws and principles, however, do not in our opinion make
the remedies provided in said agreements inadequate for the practical
realization of the benefits of the security intended to be provided
thereby.
(d) This opinion is rendered solely to you at Federal Express'
request in connection with the above matter. This opinion may not be
relied upon by you for any other purpose or relied upon by or furnished
to any other Person without our prior written consent.
(e) We rendered an opinion dated [April 22, 1996] [May 24, 1996]
(the "Delivery Opinion"), a copy of which is attached hereto, in
connection with the financing and acquisition of the Aircraft on such
date. We hereby consent and agree that the addressees hereto who were
not addressees to the Delivery Opinion may rely on the Delivery Opinion
as fully and with the same force and effect as if such addressees were
originally named therein on the date of the Delivery Opinion.
Very truly yours,
SCHEDULE
Owner Trustee
First Security Bank of Utah, National Association
Indenture Trustee
State Street Bank and Trust Company
Owner Participant
[Boatmen's Equipment Finance, Inc.]
[PMCC Leasing Corporation]
Original Loan Participants
The Entities listed on Schedule I to the Participation Agreement as Original
Loan Participants
Lessee
Federal Express Corporation
Pass Through Trustee
State Street Bank and Trust Company
Underwriters
Goldman, Sachs & Co.
J.P. Morgan Securities Inc.
Morgan Stanley & Co. Incorporated
Exhibit C-2
[Letterhead of Davis Polk & Wardwell]
June __, 1996
To each of the parties
named on the Schedule hereto
Ladies and Gentlemen:
We have acted as special counsel for Federal Express Corporation,
a Delaware corporation ("Federal Express"), in connection with the transaction
contemplated by the Participation Agreement (Federal Express Corporation Trust
No. N669FE), dated as of June 1, 1996 (the "Participation Agreement") among
Federal Express, as Lessee, PMCC Leasing Corporation, as Owner Participant,
First Security Bank of Utah, National Association, as Owner Trustee, State
Street Bank and Trust Company, as Indenture Trustee and State Street Bank and
Trust Company, as Pass Through Trustee. This opinion is being delivered
pursuant to Section 4.01(k)(v) of the Participation Agreement. Capitalized
terms not otherwise defined herein have the meanings assigned thereto in the
Participation Agreement.
The Participation Agreement provides, among other things, for the
financing on the Delivery Date of a portion of the Owner Trustee's payment of
the Purchase Price of one Airbus A300F4-605R Aircraft using the proceeds from
the public offering of the Pass Through Certificates. On the Certificate
Closing Date, two Series of Pass Through Certificates will be issued by
separate Pass Through Trusts, each formed to acquire, among other securities,
the Certificates bearing a particular interest rate and having a particular
Maturity that will be issued under the Indenture.
In connection with the opinions expressed below, we have examined
executed counterparts of the Operative Agreements to be delivered on the
Certificate Closing Date the Pass Through Certificates, the Pass Through
Agreement, each Series Supplement (the "Certificate Closing Date Documents")
and the forms of the Operative Agreements to be delivered on the Delivery
Date. We have also examined originals, or copies certified to our
satisfaction, of such other agreements, documents, certificates and statements
of governmental officials and corporate officers as we have deemed necessary
or advisable as a basis for such opinions. In such examination, we have
assumed the genuineness of all signatures and the authenticity of all
documents submitted to us as originals and the conformity with the originals
of all documents submitted to us as copies.
As to any facts material to our opinions expressed below, we have,
with your consent, relied on the representations and warranties made in or
pursuant to the Participation Agreement and the other documents referred to
therein, the accuracy of which we have not independently verified. In
addition, we have, when relevant facts were not independently established by
us, relied, to the extent we deemed such reliance proper, upon certificates of
public officials and certificates, telegrams and other written or oral
statements of officers of the parties referred to herein.
Based on the foregoing, it is our opinion that:
1. The execution, delivery and performance by the Owner Trustee
in its individual or trust capacity, as the case may be, of the
Certificate Closing Date Documents (other than the Certificates) to
which it is a party, and the issuance, execution, delivery and
performance of the Certificates by the Owner Trustee in its trust
capacity do not violate, and fully comply with, any laws and
governmental rules and regulations of the State of New York that may be
applicable to the Owner Trustee in its individual or trust capacity, as
the case may be. The opinion set forth in this paragraph 1 is rendered
without regard to the effect, if any, on such issuance (in the case of
the Certificates), execution, delivery or performance of the taking of
any other action, the conduct of any other business or the exercise of
any other powers by FSBU, in its individual or in a trust capacity, in
the State of New York not related to the transactions contemplated by
the Certificate Closing Date Documents. We have assumed that FSBU has
made the filings necessary to comply with Section 131.3 of the Banking
Law of the State of New York. However, we express no opinion as to
whether FSBU is required to comply with said Section 131.3.
2. (a) Each of the Certificate Closing Date Documents to
which Federal Express is a party has been duly authorized, executed and
delivered by Federal Express. Each of the Operative Agreements to which
Federal Express is to be a party and which are to be delivered on the
Delivery Date has been authorized by Federal Express.
(b) The execution, delivery and performance by Federal
Express of each of the Certificate Closing Date Documents to which
Federal Express is a party do not, or did not on the date of execution
thereof, violate, and fully comply, or did fully comply on the date of
execution thereof, with, any laws and governmental rules and regulations
of the State of New York that may be applicable to Federal Express. The
opinion set forth in this paragraph 2(b) is rendered without regard to
the taking of any other action or the conduct of any other business by
Federal Express in the State of New York not related to the transactions
contemplated by the Certificate Closing Date Documents.
3. Assuming (i) the due authorization, execution and delivery
of the Certificate Closing Date Documents by each of the parties to each
such document (other than Federal Express), (ii) each such party has
full power and legal right to enter into and perform its respective
obligations under the Certificate Closing Date Documents, (iii) that the
execution, delivery, performance by each of the Certificate Closing Date
Documents by each of the parties thereto will not violate the respective
parties' constituent documents, (iv) the due authorization, execution,
issue and delivery by the Owner Trustee, and the due authentication by
the Indenture Trustee, of the Certificates to be issued under the
Indenture in accordance with the terms of the Indenture, (v) the due
authorization, execution, issuance, delivery and authentication by the
Pass Through Trustee of the Pass Through Certificates to be issued under
the Pass Through Agreement and the Series Supplement relating to such
Pass Through Certificates, in each case in accordance with the terms of
the Pass Through Agreement and such Series Supplement, and (vi) that the
form of each such Certificate Closing Date Documents is in compliance
with all applicable laws and governmental rules and regulations (other
than the laws of the United States and the laws of the State of New
York), then: (A) to the extent governed by New York law, each such
Certificate Closing Date Documents in form constitutes a legal, valid
and binding agreement of each party thereto enforceable against each
such party in accordance with its terms; (B) the Indenture creates, for
the benefit of the Holders the security interest in the Trust Indenture
Estate that they purport to create; (C) the Certificates, when issued to
and acquired by the Pass Through Trustee, will be legal, valid and
binding obligations of the Owner Trustee enforceable against the Owner
Trustee in accordance with their terms and the terms of the Indenture
and will be entitled to the benefits of the Indenture, including the
benefit of the security interest created thereby except that no opinion
is given with respect to perfection of such security interest on the
date hereof; (D) the Pass Through Certificates, when issued to and
acquired by the Underwriters in accordance with the Underwriting
Agreement, will be legal, valid and binding obligations of the Pass
Through Trustee enforceable against the Pass Through Trustee in
accordance with their terms and will be entitled to the benefits of the
Pass Through Agreement and the Series Supplement relating thereto; and
(E) the beneficial interest of the Owner Participant under the Trust
Agreement in and to the properties which are part of the Trust Indenture
Estate is subject, to the extent provided in the Indenture, to the Lien
of the Indenture in favor of the Holders.
4. Federal Express' participation in the transactions
contemplated by the Operative Agreements does not and will not
constitute a violation of Section 7 of the Securities Exchange Act of
1934.
5. It is not necessary, in connection with the creation of the
beneficial interest of the Owner Participant of the Trust Indenture
Estate under the circumstances contemplated by the Participation
Agreement to register such beneficial interest under the Securities Act
of 1933, as amended, or to qualify the Trust Agreement under the Trust
Indenture Act of 1939, as amended.
The foregoing opinions are subject to the following
qualifications:
(a) We have relied, with your consent, without independent
investigation and verification and subject to the assumptions and
qualifications contained therein, on the opinion dated the date hereof
of George W. Hearn, Vice President - Law of Federal Express.
(b) We are qualified to practice law in the State of New York,
and we do not purport to be experts on, or to express any opinion herein
concerning, any laws other than the laws of the State of New York, the
laws of the United States and the General Corporation Law of the State
of Delaware.
(c) The opinion contained in paragraph 3 above as to
enforceability is subject to (i) applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors' rights generally and (ii) general principles of equity which
may affect the remedies provided in the agreements referred to in said
opinions, which laws and principles, however, do not in our opinion make
the remedies provided in said agreements inadequate for the practical
realization of the benefits of the security intended to be provided
thereby.
(d) This opinion is rendered solely to you at Federal Express'
request in connection with the above matter. This opinion may not be
relied upon by you for any other purpose or relied upon by or furnished
to any other Person without our prior written consent.
Very truly yours,
SCHEDULE
Owner Trustee
First Security Bank of Utah, National Association
Indenture Trustee
State Street Bank and Trust Company
Owner Participant
PMCC Leasing Corporation
Lessee
Federal Express Corporation
Pass Through Trustee
State Street Bank and Trust Company
Underwriters
Goldman, Sachs & Co.
J.P. Morgan Securities Inc.
Morgan Stanley & Co. Incorporated
Exhibit D
Form of Opinion of Company Counsel
June ___, 1996
GOLDMAN, SACHS & CO.
J.P. MORGAN SECURITIES INC.
MORGAN STANLEY & CO. INCORPORATED
c/o GOLDMAN, SACHS & CO.
85 Broad Street
New York, New York 10004
Re: Federal Express Corporation
1996 Pass Through Certificates, Series A1 and A2 (the "Offered
Certificates")
Ladies and Gentlemen:
This opinion is directed to the Underwriters pursuant to Section 5(b)(2)
of the Underwriting Agreement dated June 5, 1996 (the "Underwriting
Agreement"), among the Company and you, with respect to the offer and sale of
the Offered Certificates. All terms defined or used in the Underwriting
Agreement have the same meaning when used herein, unless otherwise noted.
I am Vice President-Law of the Company and have acted as such in
connection with the Offered Certificates and the Underwriting Agreement. I or
attorneys under my supervision have made such examination and investigation as
we have deemed necessary in order to give the following opinion.
Based on the foregoing, it is my opinion that:
(i) The Company is a corporation duly incorporated, validly
existing and in good standing under the laws of the State of Delaware
and the Company has full corporate power and authority under such
laws to own its properties and to conduct its business as described
in the Prospectus; the Company is a "citizen of the United States"
within the meaning of Section 40102(a)(15) of Title 49 of the United
States Code, as amended, holding an air operating certificate issued
by the Secretary of Transportation pursuant to Chapter 447 of Title
49 of the United States Code, as amended, for aircraft capable of
carrying 10 or more individuals or 6,000 or more pounds of cargo; the
Company is duly qualified to do business and is in good standing in
each jurisdiction in which it owns or leases real property or in
which the conduct of its business requires such qualification, except
for such instances which in the aggregate will not have a material
adverse effect on the Company;
(ii) Each subsidiary of the Company which is a significant
subsidiary as defined in Rule 405 of Regulation C of the 1933 Act
Regulations (each a "Significant Subsidiary") has been duly incorporated
and is validly existing as a corporation in good standing under the laws
of the jurisdiction of its incorporation, has corporate power and
authority to own, lease and operate its properties and conduct its
business as described in the Registration Statement, and, to the best of
my knowledge, is duly qualified as a foreign corporation to transact
business and is in good standing in each jurisdiction in which such
qualification is required, except where the failure to so qualify would
not have a material adverse effect on the condition, financial or
otherwise, or the earnings, business affairs or business prospects of
the Company and its subsidiaries considered as one enterprise; all of
the issued and outstanding capital stock of each Significant Subsidiary
has been duly authorized and validly issued and is fully paid and
non-assessable, and all of such capital stock, except for directors'
qualifying shares, is owned by the Company, directly or through
subsidiaries, free and clear of any mortgage, pledge, lien, encumbrance,
claim or equity;
(iii) Except for matters described in the Prospectus (as to which
I can express no opinion at this time concerning the Company's liability
(if any) or the effect of any adverse determination upon the business,
condition (financial or otherwise) or operations of the Company), there
is no pending, or to my knowledge, threatened action or proceeding
before any court or administrative agency which individually (or in the
aggregate in the case of any group of related lawsuits) is expected to
have a material adverse effect on the financial condition of the Company
or the ability of the Company to perform its obligations under the Pass
Through Agreements and the other Operative Agreements to which the
Company is a party;
(iv) The Pass Through Agreements and the other Operative
Agreements to which the Company is a party have been duly and validly
authorized, executed and delivered by the Company;
(v) The Equipment Certificates are in due and proper form and
have been duly and validly authorized by all necessary corporate action;
(vi) The Company possesses all permits, approvals, franchises and
other rights from federal aviation, aeronautical, communications,
transportation and shipping authorities which are requisite for the
conduct of its business as described in the Prospectus or for the
actions contemplated by the Underwriting Agreement and the offering
contemplated by the Prospectus; and the actions contemplated by the
Underwriting Agreement, the Pass Through Agreements, the Participation
Agreements and the other Operative Agreements, and the offering
contemplated by the Prospectus, are not in violation of any federal
statute or regulation relating to aviation, aeronautics, communications,
transportation or shipping;
(vii) The Basic Agreement is qualified under the 1939 Act; I have
reviewed or caused to be reviewed by attorneys under my supervision the
Registration Statement, the Prospectus and each amendment and supplement
thereto (including the documents incorporated by reference) and have no
reason to believe that, as of their respective effective or issue dates,
or as of the Closing Time, either the Registration Statement or the
Prospectus or any such amendment or supplement (or any such documents
incorporated by reference) contained an untrue statement of a material
fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading;
(viii) I do not know of any statute or regulation or legal or
governmental proceeding required to be described in the Prospectus
which is not described as required, nor of any contract or document
of a character required to be described in the Registration Statement
or the Prospectus or to be filed as exhibits to the Registration
Statement which is not described and filed as required; and the
descriptions in the Registration Statement and the Prospectus of the
contracts and other documents therein described are accurate and
fairly present the information required to be shown;
(ix) The execution and delivery by the Company of the
Underwriting Agreement, the Pass Through Agreements and the Operative
Agreements to which the Company is a party, the consummation by the
Company of the transactions herein and therein contemplated and
compliance with the terms of the Underwriting Agreement, the Pass
Through Agreements and such Operative Agreements do not and will not
conflict with or result in a breach of any of the terms of the
Certificate of Incorporation or By-laws of the Company, and will not
conflict with or result in a breach of any of the terms or provisions
of, or constitute a default under, any indenture, mortgage, deed of
trust, loan, credit or note agreement, lease or other agreement or
instrument material to the Company to which the Company is a party or
by which it or any or its properties are bound, or any existing
applicable law, rule, regulation, judgment, order or decree of any
government, governmental instrumentality or court, having
jurisdiction over the Company or any of its properties;
(x) The statements in the Basic Prospectus under the captions
"Description of the Pass Through Certificates" and "Description of the
Equipment Certificates" and in the Prospectus Supplement under the
captions "Description of the Pass Through Certificates" and "Description
of the Equipment Trust Certificates," insofar as such statements
constitute a summary of the Pass Through Agreements, the Offered
Certificates, the Leases, the Participation Agreements and the
Indentures, are accurate summaries of the material provisions thereof
and fairly present the information called for by the 1933 Act and the
1933 Act Regulations with respect thereto;
(xi) No authorization, approval, consent or license of any
regulatory body or authority (other than under the 1933 Act, the 1939
Act and the securities or Blue Sky laws of the various states) is
required for the valid authorization, issuance, sale and delivery of the
Offered Certificates as herein contemplated or the valid authorization,
execution, delivery and performance by the Company of the Underwriting
Agreement, the Pass Through Agreements and the other Operative
Agreements to which the Company is a party or the consummation by the
Company of the transactions contemplated herein or therein, or, if so
required, all such authorizations, approvals, consents and licenses,
specifying the sale, have been obtained and are in full force and
effect;
(xii) The Registration Statement has become effective under the
1933 Act and, to the best of my knowledge, no stop order suspending the
effectiveness of the Registration Statement has been issued and no
proceedings for that purpose have been instituted or are pending or
contemplated under the 1933 Act; the Registration Statement and the
Prospectus, and each amendment or supplement thereto (except for the
financial statements and schedules included therein, as to which I
express no opinion), comply as to form in all material respects to the
requirements of the 1933 Act and the 1933 Act Regulations and, as to
documents incorporated therein, to the requirements of the 1934 Act and
the 1934 Act Regulations in effect at the time such documents were filed
with the Commission; and
(xiii)The Underwriting Agreement has been duly and validly
authorized, executed and delivered by the Company and constitutes a
valid and binding agreement of the Company, enforceable in accordance
with its terms, except as enforcement thereof is limited by bankruptcy,
insolvency, reorganization and other laws of general applicability
relating to or affecting enforcement of creditors' rights or by general
equity principles and subject to any principles of public policy
limiting the right to enforce the indemnification and contribution
provisions contained in Sections 6 and 7 of the Underwriting Agreement.
In rendering the foregoing opinion, we have assumed that (i) all
signatures on all documents examined by us are genuine and that where any such
signature (other than a signature purporting to have been made on behalf of
the Company) purports to have been made in a corporate, governmental,
fiduciary or other capacity, the person who affixed such signature had the due
authority to do so, (ii) certain factual matters contained in certificates of
public officials are accurate, true and correct, and (iii) photostatic copies
of such documents, records and certificates conform to the originals.
This opinion is intended solely for the benefit of the Underwriters and
is not to be relied on by, and no copies of it are to be delivered to, any
other person without my prior written consent, except that Underwriters'
counsel may rely upon this opinion as to all matters of Tennessee law or
Delaware corporate law in rendering its opinion of even date herewith. I am
not assuming any professional responsibility to any other person by rendering
this opinion. It is understood that this opinion speaks as of the date given,
notwithstanding any delivery as contemplated above on any other date.
_____________________________________
George W. Hearn
Vice President-Law
Schedule I
to
Underwriting
Agreement
Dated: June 5, 1996
FEDERAL EXPRESS CORPORATION
1996 Pass Through Certificates, Series A1
1996 Pass Through Certificates, Series A2
Aggregate Aggregate
Amount of Amount of Total
Series A1 Series A2 Aggregate
Pass Through Pass Through Amount to
Underwriters Certificates Certificates Be Purchased
- --------------------------- ------------ ------------ ------------
GOLDMAN, SACHS & CO. $55,107,000 $8,203,000 $63,310,000
J.P. MORGAN SECURITIES INC. $55,105,000 $8,202,000 $63,307,000
MORGAN STANLEY & CO.
INCORPORATED $55,105,000 $8,202,000 $63,307,000
Schedule II
to
Underwriting Agreement
Dated: June 5, 1996
FEDERAL EXPRESS CORPORATION
1996 Pass Through Certificates, Series A1
1996 Pass Through Certificates, Series A2
To: Federal Express Corporation
2005 Corporate Avenue
Memphis, Tennessee 38132
Re: Underwriting Agreement dated June 5, 1996
Title of Offered Certificates: 1996 Pass Through Certificates, Series A1
1996 Pass Through Certificates, Series A2
Current ratings: BBB+/A3
Interest rate: Series A1......7.85%
Series A2.......8.17%
Interest payable: each January 30 and July 30 commencing
on July 30, 1996
Public offering price: 100%, plus accrued interest from June 11, 1996
Closing date, time and
location: June 11, 1996, 9:00 A.M., New York City time
Davis Polk & Wardwell
450 Lexington Avenue
New York, NY 10017
Location for checking Offered
Certificates: New York, New York
Listing requirement: None
Other terms and
conditions: The Offered Certificates will be issued in
fully registered, book-entry only form
through the facilities of The Depository
Trust Company, and each Series of the
Offered Certificates shall be represented
by a separate global certificate.
Exceptions, if any, to
Section 3(i) of the
Underwriting Agreement: None
* * *
GOLDMAN, SACHS & CO.
J.P. MORGAN SECURITIES INC.
MORGAN STANLEY & CO. INCORPORATED
By: Goldman, Sachs & Co.
By: /S/ GOLDMAN, SACHS & CO.
-----------------------------
Name: Marcus Colwell
Title: Vice President
Acting on behalf of themselves and the
other named Underwriters
Accepted:
FEDERAL EXPRESS CORPORATION
By:/S/ ROBERT D. HENNING
--------------------------------------------
Name: Robert D. Henning
Title: Assistant Treasurer and
Managing Director, Structured Finance