READ Semi-monthly Update

September 9, 2016

1. Any significant
events in the lives
of our people- new
children or
grandchildren ,
loss of a loved
one, events they
have shared with
others in your
organization
(weddings,
engagements,
divorces,
celebrations,
illnesses- but only
if they have shared
it with their
workgroups).

2. The specifics of
any V delays
during the past
week.

3. Total number of V
delay minutes the
previous week in
the Western and
Central Regions.

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September 9, 2016

4. Leases or lease City or Airport ID New (N) Total Rate Annual Comments
renewals fully Name or SF PSFPA Rent
executed the past Renewal
week. (R)
Albuquerque, ABQR R 214,799 $2.12 $455,374 M-t-M agreement,
NM 18.44% increase in rent
Ann Arbor, MI ARBA R 45,400 $8.90 $404,060 10-year renewal, 39.5%
increase in rent
Helena, MT HLNA R 7,680 $4.20 $32,256 5-year renewal, 5.00%
increase in rent
Lawton, OK LAWA R 10,000 $6.00 $60,000 5-year renewal, no change
in rent
Gilford, NH LCIA R 15,128 $6.49 $98,181 10-year renewal, 3.02%
increase in rent
Pleasanton, CA LVKA R 98,030 $17.06 $1,672,392 9-year renewal, 16.93%
increase in rent
Memphis, TN OLVA R 89,972 $5.67 $510,141 7-year renewal, no change
in rent
Register, GA PIMA R 9,372 $3.90 $36,551 5-year renewal, no change
in rent
Wilson, NC RWIA R 34,485 $5.56 $191,737 5-year renewal, 10.32%
increase in rent

11. Other significant Real Estate

events/activities/issues.

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September 9, 2016

1. Projects issued to FFM West and Memphis International Airport (MEM) MEMH Transformation / Relocation
Central. Project: CLEAR approved on April 13, 2016 for $36 million in capital and $21 million
in lease expense. The 8th Amendment to the Composite Lease Agreement (lease of the
MSCAAs Maintenance and Administration Buildings) is fully executed and FedEx will
gain access to the Administration Building on April 1, 2017 and the Maintenance Building
on September 1, 2017. Lease for the Tchulahoma Office building has been approved by
FedEx Legal and will be routed for signature. MSCAA is scheduled to approve the
Tchulahoma Office agreement at their September 15, 2016 Board Meeting.

Lafayette Regional Airport (LFT) Forced Relocation: July 8, 2016, Finance officially
recommended FedEx relocate to the Acadiana Regional Airport (ARA) which is 20 miles
to the south. Finances analysis showed LFT had a slightly less negative Net Present Value
(NPV) than ARA; but concluded ARA is the better choice because LFTs high rent was
deemed a hard cost, while larger line haul costs at ARA were considered a soft cost
which could be mitigated by an earlier arrival of the Memphis flight. On July 12, 2016,
AR&D informed LFT we are seeking an annual rent reduction of $100,000 (i.e., annual
rent of $200k) in order to make operating in the facility economically viable. On Friday,
August 26, 2016, LFT Airport confirmed FedExs first year rent will not exceed $203,000
with annual CPI adjustments. On September 6, 2016, a change-of-scope CLEAR was
approved to increase total rent from the $1.9 million approved in 2014 to the $4.0 million
required by the revised terms (please note part of the rent increase is due to the lease term
being increased from 10 years to 15 years). Airport anticipates the building to be completed
in November 2016, but FedEx will not relocate until March 2017 at the earliest.

GFKR-Grand Forks, ND:

The final negotiated lease buy out terms follow. AR&D awaits final approval from the
Postal Transaction Management Group before memorializing the transaction.

Reimbursement for the 2013 expansion: $ 924,500.68 Unamortized cost of

expansion per Lease Agreement
Lease Buy-Out: $ 1,829,274.32 75% of the projected rent for

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September 9, 2016

the remaining term of both leases

Total: $ 2,753,775.00

CLTR-Charlotte, NC:

A draft BJD was submitted to Finance on September 9, 2016 to relocate the current CLTR and
QWGA locations to an available on-airport site at 4200 Yorkmont Road. Because the relocation
may not be able to be completed as planned, an extension of the early termination provision of the
QWGA lease is currently being negotiated by the off-airport real estate group.

IND-As it relates to the 6 gate expansion issue

IAA is looking at leasing FedEx the old terminal property at Indianapolis Airport for very
little compared to current rental rates and build out the 2 mile end around road to correct
the elevation issues that connects this area to the current FedEx Hub apron area. The
number that was suggested to IAA on 2.8 million sq. ft. old terminal area at $0.12 per sq.
ft. This equates to $336,000 annual rental payments to IAA. FedEx could potentially start
parking (15) MD11s day one using the apron that is already in place. There is opportunity
to park another 15 + or more on this site once new concrete apron has been put in place.

IAA has already stated that it would be difficult to meet the $0.12 per sq. ft. rate but they
are still working on the numbers and will get back to us soon.

LCK

. There may be another location that FedEx could set up its maintenance parts storage
area in. This are is located at 7200 Alum Creek Drive, suites J and K . It has
approximately 11,200 -sq. ft.
This area is not as convent as the 2566 Jerrie Mock location but we can lease it
now. We have been trying to get into the Jerrie Mock location for a year now. The
current tenant has been expected to vacate but has not indicate when they will be

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September 9, 2016

leaving. The landlord for the 7200 Alum Creek property is suggesting a Rental rate
$4.50 per sq. ft. the first year with $0 .25 increase each year. Operating expenses
$1.53 PSF. This space would have to have each demising wall to add another layer
of drywall to meet code for your use. This space is behind the 2566 Jerrie Mock
building close to FedEx gate to airfield.

13. Airport related issues.

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