CARMAX, INC.
NOTICE OF STOCK OPTION GRANT

%%FIRST_NAME%-% %%LAST_NAME%-%
%%ADDRESS_LINE_1%-%
%%ADDRESS_LINE_2%-%
%%CITY%-% , %%STATE%-% %%ZIPCODE%-%

Dear %%FIRST_NAME%-% %%LAST_NAME%-%

The Board of Directors of CarMax, Inc. (the “Company”) wants to provide you with
an opportunity to share in the success of our Company. Accordingly, I am pleased
to inform you that, as of %%OPTION_DATE%_% the Compensation and Personnel
Committee of the Board of Directors of the Company (the “Committee”) exercised
its authority pursuant to the CarMax, Inc. 2002 Stock Incentive Plan, as amended
and restated (the “Plan”) and granted you non-statutory options to purchase
shares of the common stock of CarMax, Inc. (the “Options”) as set forth herein.
The Options are not qualified for Incentive Stock Option tax treatment. Limited
stock appreciation rights (“SARs”), described below, were also granted in
connection with these Options.

The Options and SARs are subject to the provisions of the Plan. The Committee
administers the Plan. The terms of the Plan are incorporated into this notice of
Stock Option Grant (the “Notice of Grant”) and in the case of any conflict
between the Plan and this Notice of Grant, the terms of the Plan shall control.
All capitalized terms not defined herein shall have the meaning given to them in
the Plan. Please refer to the Plan for certain conditions not set forth in this
Notice of Grant. Additionally, a copy of a Prospectus for the Plan, which
describes material terms of the Plan, can be found on The CarMax Way. Copies of
the Prospectus, the Plan and the Company’s annual report to shareholders on Form
10-K for fiscal year 20     are available from the Company’s corporate secretary
at (804) 747-0422.

Number of Shares Subject to Option: %%TOTAL_SHARES_GRANTED%-%
Option Price Per Share: %%OPTION_PRICE%-%

Vesting of Options

Except as otherwise provided in this Notice of Grant, the Options will vest and
become exercisable according to the following schedule: one-fourth on
%%VEST_DATE_PERIOD1%-% , one-fourth on %%VEST_DATE_PERIOD2%-% , one-fourth on
%%VEST_DATE_PERIOD3%-% , and one-fourth on %%VEST_DATE_PERIOD4%-% provided you
continue to be employed by the Company on such dates.

Termination of Options

The unexercised Options shall terminate upon the earliest to occur of the
following conditions:

  1.   Expiration. The Options will expire on %%EXPIRE_DATE_PERIOD1%-% (the
“Expiration Date”).

  2.   Termination Without Cause or for Good Reason; Immediate Vesting. If the
Company terminates your employment with the Company for any reason other than
Cause (as defined in your employment agreement with the Company), including for
“Involuntary Termination Without Cause” or “Termination Without Cause”, as
applicable, as defined in your employment agreement with the Company, or you
terminate your employment for “Good Reason”, if applicable, as defined in your
employment agreement with the Company, all of your Options will become
immediately vested and exercisable, effective as of the date of the termination
of your employment. You, your personal representative, distributees, or
legatees, must exercise your Options within three (3) months of the effective
date of such termination.

  3.   Termination For Cause. Upon termination of your employment with the
Company for “Cause” as defined in your employment agreement with the Company,
your unexercised vested and unvested Options will terminate immediately.

  4.   Change in Full-Time Employment Status. In the event that your employment
with the Company changes from full-time to part-time for any reason, your
unvested Options will expire on the date of the change. Your vested Options will
be unaffected and remain subject to the terms of this Notice of Grant.

  5.   Resignation; Leave. In the event that you resign your employment with the
Company, you must exercise your vested Options within three (3) months of your
resignation date or they will expire. Options that have not vested by your
resignation date will expire on your resignation date. Employees on authorized
leave (as determined under the Company’s authorized leave policy) will not be
considered as having terminated merely by reason of the leave and will continue
to be eligible to exercise and sell their Options during the period of the
leave.

Exercise of Options

When the Options are exercisable, you may purchase shares of Company common
stock under your Option by:

  1.   Giving written notice to the Company, signed by you, stating the number
of shares you have elected to purchase; and

  2.   Remitting payment of the purchase price in full (You may deliver Mature
Shares of Company common stock that you own in satisfaction of all or any part
of the purchase price or make other arrangements satisfactory to the Company and
permitted by the Plan regarding payment of the purchase price); and

  3.   Remitting payment to satisfy the income tax withholding requirements for
non-statutory options or making other arrangements to satisfy such withholding
that are satisfactory to the Company and permitted by the Plan.

Death, Disability or Retirement

If your employment by the Company terminates because you die, become disabled or
retire (in accordance with retirement eligibility provisions of the Company’s
retirement plan) all of your Options covered by this Notice of Grant will become
immediately vested and exercisable, effective as of the date of the termination
of your employment, and you, your personal representative, distributees, or
legatees, as applicable, may exercise your vested Options at any time before the
Expiration Date.

Transferability of Options

Except as provided below, the Options are not transferable by you other than by
will or by the laws of descent and distribution and is exercisable during your
lifetime only by you. You may transfer your rights under the Option during your
lifetime subject to the following limitations:

  1.   Transfers are allowed only to the following transferees:

  a)   Your spouse, children, step-children, grandchildren, step-grandchildren
or other lineal descendants (including relationships arising from legal
adoptions). Such individuals are hereinafter referred to as “Immediate Family
Members”.

  b)   Trust(s) for the exclusive benefit of any one or more of your Immediate
Family Members.

  c)   Partnership(s), limited liability company(ies) or other entity(ies), the
only partners, members or interest holder of which are among your Immediate
Family Members.

  d)   Pursuant to a court issued divorce decree or Domestic Relations Order (as
defined in the Code or Title I of the Employee Retirement Income Security Act
(or rules thereunder)).

2. You may not receive any consideration in connection with the transfer.

  3.   Transferees may not subsequently transfer their rights under the Option
except by will or by the laws of descent or distribution.

  4.   Following the transfer, the Option will continue to be subject to the
same terms and conditions as were applicable immediately prior to transfer
(except that the transferee may deliver the Option exercise notice and payment
of the exercise price).

  5.   You must give written notice of the transfer to the Company and the
Company may require that any transfer is conditioned upon the transferee
executing any document or agreement requested by the Company.

Any Option transferred in accordance with the terms hereof shall be accompanied
by the associated SAR.

Change of Control; SARs

Notwithstanding the vesting schedule set forth in the “Vesting of Options”
section hereof, in the event of a Change of Control, all unvested Options
granted hereunder shall vest in accordance with the following:

  •   50% of your unvested Options shall vest upon the date of the Change of
Control; and

  •   50% of your unvested Options shall vest upon the one year anniversary of
the date of the Change of Control. Notwithstanding the foregoing, in the event
that any of your unvested Options would have vested sooner than the one year
anniversary of the date of the Change of Control (based upon the vesting
schedule set forth in the “Vesting of Options” section hereof or any other terms
or conditions affecting vesting rights contained herein), such sooner vesting
date shall apply to such unvested Options.

You shall have the right during the period beginning on the applicable vesting
date set forth above and ending on the Expiration Date to exercise any and all
vested Options in accordance with the provisions of this Notice of Grant.

Pursuant to this Notice of Grant, you have been granted one (1) SAR for every
Option granted to you hereunder. Following a Change of Control, you may choose
to exercise the SARs granted hereunder in lieu of exercising your vested
Options. Doing so will relieve you of the obligation to pay for the exercise of
your Options as described above and, instead, will allow you to receive a cash
payment of the net value of your SARs as calculated below without having to
remit any payment to the Company. The SARs granted in connection with the
Options are limited SARs and may be exercised in accordance with the Plan and
the terms hereof as follows:

  1.   The SARs shall only be exercisable if a Change of Control occurs. In such
event, the Options will be exercisable at any time during a period of 90 days
beginning on the date the Change of Control occurs. To the extent that the SARs
or their underlying Options are not exercised during an exercise period, the
SARs will become unexercisable again until such time as another Change of
Control occurs or %%EXPIRE_DATE_PERIOD1%-% , when they expire.

  2.   When the SARs become exercisable, you may exercise the SARs by giving
written notice to the Company, signed by you, stating the number of SARs that
you are exercising.

  3.   Upon exercise of the SARs, you shall receive in exchange from the Company
an amount equal to the excess of (x) the value of the Company’s common stock on
the date of exercise, over (y) the exercise price of the underlying Option. For
purposes of this paragraph, the value of the Company’s common stock shall be the
Fair Market Value of the Company’s common stock on the date of exercise;
provided, however, if the net after tax benefit to you, after considering all
applicable taxes, interest and penalties, including taxes, interest and
penalties imposed under Code section 409A, would be greater if the value was
determined based on the highest closing price of the Company’s common stock, on
the exchange on which it is then traded, during the 90 days immediately
preceding the Change of Control, the value of the Company’s common stock shall
be such higher amount. The determination of the net after tax benefit to you
shall be made by the Company in its reasonable discretion.

  4.   The Company’s obligation arising upon exercise of the SARs shall be paid
in cash and shall be subject to required income tax withholdings.

  5.   To the extent a SAR is exercised, the underlying Option must be
surrendered. The underlying Option, to the extent surrendered, shall no longer
be exercisable.

Change in Capital Structure

If the number of outstanding shares of the Company’s common stock is increased
or decreased as a result of a stock dividend, stock split, subdivision or
consolidation of shares, or other similar change in capitalization, the number
of Company shares for which you have unexercised Options and the exercise price
will automatically be adjusted, as provided in the Plan, (i) so as to preserve
the ratio that existed immediately before the change between the number of such
shares and the total number of shares of Company stock previously outstanding,
and (ii) so that your aggregate Option price remains the same; provided,
however, that the Company will not be required to issue any fractional shares
upon exercise of your Options as a result of such adjustment.

Legal Fees

The grant of these Options does not obligate the Company to continue your
employment. If there is any litigation involving Options, each party will bear
its own expenses, including all legal fees, except that in the event of an
action brought by you under this Notice of Grant following a Change of Control,
then insofar as such action is not deemed to be frivolous by the arbitrator, the
Company shall bear all expenses related to the arbitration, including all legal
fees incurred by you. The Committee shall have the authority to interpret and
administer this Notice of Grant.

By accepting this grant on-line, this Notice of Grant, together with the Plan,
will become a Stock Option Agreement between you and the Company which is
governed by and construed and enforced in accordance with the laws of the
Commonwealth of Virginia. Further, by accepting this grant online, you agree
that you are in compliance with, and will abide by, the Company’s “Policy
Against Insider Trading – Management” which can be found on The CarMax Way.
Further, by accepting this Notice of Grant, you agree that if you have not yet
achieved the Company stock ownership levels required for your position, as
applicable, as set forth in the Company’s Stock Ownership Guidelines for Certain
Executive Officers, then upon exercise of any Options you will retain at least
50% of the underlying shares remaining after satisfaction of the option exercise
cost and applicable tax liability.

Sincerely,

[Name, Title]

ACCEPTED:

Signature

     %%FIRST_NAME%-%%%LAST_NAME%-%      %%EMPLOYEE_IDENTIFIER%-%           
Printed Name Employee ID Number