FedEx 401(k) match, vesting and fees

In order to provide for the automatic enrollment safe harbor provisions of the Pension Protection Act of 2006 (PPA), the Plan is structured as a Qualified Automatic Contribution Arrangement (QACA). For each year the Plan is structured as a QACA, the company matching contribution will be a maximum of 3.5%. The Company will match 100.0% on the first 1.0% of eligible earnings contributed and 50.0% on the next 5.0% of eligible compensation contributed on each participant’s combined pretax, catch-up, Roth, and/or Roth catch-up contributions. Effective January 1, 2022, FedEx introduced an all 401(k) plan retirement benefit structure for eligible employees with a higher company match of up to 8% across all U.S.-based operating companies. Eligible employees hired prior to January 1, 2020, who participated in a company sponsored pension plan were given a one-time option to continue receiving pension compensation credits under the existing Portable Pension Account formula of the applicable pension plan and continued eligibility for the company match as described above, or to cease receiving compensation credits under the pension plan and become eligible for the FedEx Corporation Retirement Savings Plan II with a higher match of up to 8% of eligible pay.

Participants are fully vested in all of their accounts in the Plan as of December 31, 2007. For participants who first perform service for a sponsoring employer on or after January 1, 2008, the vesting schedule for company matching contributions will be as follows: fewer than 12 months – 0%; 12 or more months – 100%.

The automatic enrollment safe harbor provisions of the PPA allow the Company to treat each employee as having elected to participate in the Plan in an amount equal to a qualified percentage of compensation. Absent any adjustment by the employee, the qualified deferral percentage will be 3% during the first year of automatic enrollment and will increase automatically by 1% each year until it reaches 10% of eligible earnings or the Internal Revenue Service (IRS) annual limit.

Eligible employees can generally contribute up to 50% of eligible compensation, as defined in the plan document, on a pretax and Roth basis (combined).

Participants may borrow amounts from their participant accounts ranging from a minimum of $1,000 to a maximum of the lesser of $50,000 or 50% of the participant’s vested account balance. The terms of loans to participants range from one to five years or, in connection with the purchase of a primary residence, up to ten years. The loans are secured by the balance in the participant’s account and bear interest at a rate commensurate with prevailing rates. A participant may have one outstanding loan at a time. A participant is not eligible for another loan until a period of one year has elapsed from the date on which a previous loan to the same individual has been fully repaid.