--------------------------------------------------------------------------------

EXECUTION COPY

AMENDMENT NO. 1 TO CREDIT AGREEMENT
AND JOINDER AGREEMENT
 
This Amendment No. 1 to Credit Agreement and Joinder Agreement (this
“Amendment”) dated as of December 8, 2006, is made by and among CARMAX AUTO
SUPERSTORES, INC., a Virginia corporation (the “Revolving Borrower”), the
Subsidiaries of the Company (other than the Revolving Borrower) listed as
“Borrowers” on the signature pages hereto (each a “Designated Borrower” and,
together with the Revolving Borrower, the “Borrowers” and, each a “Borrower”),
CARMAX, INC., a Virginia corporation (the “Company”), the Subsidiaries of the
Company listed as “Subsidiary Guarantors” on the signature pages hereto (each a
“Subsidiary Guarantor” and collectively, the “Subsidiary Guarantors”), BANK OF
AMERICA, N.A., a national banking association organized and existing under the
laws of the United States (“Bank of America”), in its capacity as administrative
agent for the Lenders (as defined in the Credit Agreement described below) (in
such capacity, the “Administrative Agent”), each of the existing Lenders under
such Credit Agreement (collectively, the “Existing Lenders”), and each of the
Persons becoming Lenders by the execution of this Amendment (the “Joining
Lenders”).
 
W I T N E S S E T H:
 
WHEREAS, the Borrowers, the Company, the Administrative Agent, Bank of America,
as Swing Line Lender, New Vehicle Swing Line Lender and L/C Issuer, and the
Existing Lenders have entered into that certain Credit Agreement dated as of
August 24, 2005 (the “Credit Agreement”; capitalized terms used in this
Amendment not otherwise defined herein shall have the respective meanings given
thereto in the Credit Agreement), pursuant to which the Existing Lenders have
made available to the Borrowers a revolving credit facility with letter of
credit and swing line subfacilities; and
 
WHEREAS, the Subsidiary Guarantors and the Administrative Agent have entered
into that certain Subsidiary Guaranty Agreement dated as of August 24, 2005
pursuant to which the Subsidiary Guarantors have guaranteed the payment and
performance of the obligations of the Borrowers under the Credit Agreement and
the other Loan Documents; and
 
WHEREAS, the Company and the Administrative Agent have entered into that certain
Company Guaranty Agreement dated as of August 24, 2005 pursuant to which the
Company has guaranteed the payment and performance of the obligations of the
Borrowers under the Credit Agreement and the other Loan Documents; and
 
WHEREAS, the Company and the Borrowers have advised the Administrative Agent and
the Existing Lenders that they desire to amend certain provisions of the Credit
Agreement to, among other things, (i) amend the definition of the Applicable
Rate, (ii) extend the Maturity Date, (iii) increase the Aggregate Commitments
from $450,000,000 to $500,000,000 (such increase to be allocated among the
Joining Lenders and certain of the Existing Lenders), (iv) add an option to
further increase the Aggregate Commitments in an amount up to $100,000,000, and
 

 
 

--------------------------------------------------------------------------------

 

(v) increase the Swing Line Sublimit from $25,000,000 to $35,000,000, in each
case as more particularly set forth below, and the Administrative Agent, the
Existing Lenders and the Joining Lenders are willing to effect such amendments
on the terms and conditions contained in this Amendment;
 
NOW, THEREFORE, in consideration of the premises and further valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties hereto agree as follows:
 
1. Amendments to Credit Agreement.  Subject to the terms and conditions set
forth herein, the Credit Agreement is hereby amended as follows:
 
(a)  
The existing definition of “Applicable Rate” in Section 1.01 is deleted in its
entirety and the following is inserted in lieu thereof:

 
“Applicable Rate” means a per annum rate equal to:
 
(a)            with respect to Base Rate Loans, 0.00%;
 
(b)            with respect to Eurodollar Rate Loans, 0.875%;
 
(c)            with respect to Letter of Credit Fees, 0.875%; and
 
(d)           with respect to the Commitment Fee, 0.15%.
 
(b)  
The existing definition of “Swing Line Sublimit” in Section 1.01 is deleted in
its entirety and the following is inserted in lieu thereof:

 
“Swing Line Sublimit” means an amount equal to the lesser of (a) $35,000,000 and
(b) the Aggregate Commitments.  The Swing Line Sublimit is part of, and not in
addition to, the Aggregate Commitments.
 
(c)  
The existing definition of “Maturity Date” in Section 1.01 is deleted in its
entirety and the following is inserted in lieu thereof:

 
“Maturity Date” means December 8, 2011.
 
(d)  
The existing definitions of “Consolidated Current Assets”, “Consolidated Current
Liabilities” and “Consolidated Current Ratio” in Section 1.01 are deleted in
their entirety.

 
(e)  
The existing definition of “Consolidated EBITDA” in Section 1.01 is deleted in
its entirety and the following is inserted in lieu thereof :

 

 
2

--------------------------------------------------------------------------------

 

“Consolidated EBITDA” means, for any period, for the Company and its
Subsidiaries on a consolidated basis, an amount equal to Consolidated Net Income
for such period plus (a) the following to the extent deducted in calculating
such Consolidated Net Income: (i) Consolidated Interest Charges for such period,
(ii) the provision for Federal, state, local and foreign income taxes payable by
the Company and its Subsidiaries for such period, (iii) depreciation and
amortization expense, (iv) share-based compensation expense reducing such
Consolidated Net Income which does not represent a cash item in such period or
any future period, and (v) other non-recurring expenses of the Company and its
Subsidiaries reducing such Consolidated Net Income which do not represent a cash
item in such period or any future period and minus (b) the following to the
extent included in calculating such Consolidated Net Income: (i) Federal, state,
local and foreign income tax credits of the Company and its Subsidiaries for
such period and (ii) all non-cash items increasing such Consolidated Net Income.
 
(f)  
The existing definition of “Consolidated Fixed Charges” in Section 1.01 is
deleted in its entirety and the following is inserted in lieu thereof:

 
“Consolidated Fixed Charges” means, for any period (the “Calculation Period”),
the sum of (a) Consolidated Interest Charges for such period plus (b)
Consolidated Rental Obligations for such period, plus (c) Federal, state, local
and foreign income taxes paid in cash by the Company and its Subsidiaries on a
consolidated basis for such period, plus (d) Consolidated Scheduled Principal
Payments (excluding any scheduled payments of principal that were (i) paid
during the Calculation Period with the proceeds of replacement Indebtedness or
(ii) deferred to a later period by an appropriate written amendment, but
including payments of principal that were deferred to such Calculation Period
from a prior period) of the Company and its Subsidiaries on a consolidated basis
for such period.  For purposes of clarity (and without limiting the generality
of clause (b) of the definition of “Subsidiary”), the parties acknowledge that
any reference to Subsidiary in this definition of Consolidated Fixed Charges
shall exclude those Subsidiaries which would not otherwise qualify as a
Subsidiary under clause (b) of the definition of “Subsidiary.”
 
(g)  
Section 1.01 is amended by adding the following definition:

 
“Increase Effective Date” has the meaning specified in Section 2.16(d).
 
(h)  
The Consolidated Current Ratio covenant set forth in Section 7.09(a) is deleted
in its entirety and the following is inserted in lieu thereof:  [RESERVED].

 
(i)  
The Consolidated Tangible Net Worth covenant set forth in Section 7.09(d) is
deleted in its entirety and the following is inserted in lieu
thereof:  [RESERVED].

 

 
3

--------------------------------------------------------------------------------

 

(j)  
The following new Section 2.16 is hereby inserted and added to the Credit
Agreement immediately following Section 2.15:

 
2.16           Increase in Commitments.
 
(a)           Request for Increase.  Provided there exists no Default and there
has been no prior reduction of the Aggregate Commitments, upon notice to the
Administrative Agent (which shall promptly notify the Lenders), the Company may,
from time to time, request an increase in the Aggregate Commitments by an amount
(for all such requests) not exceeding $100,000,000; provided that (i) any such
request for an increase shall be in a minimum amount of $25,000,000, (ii) no
such increase shall result in any increase in the Letter of Credit Sublimit,
Swing Line Sublimit or the New Vehicle Swing Line Sublimit, and (iii) the
Company may make a maximum of three such requests.  At the time of sending such
notice, the Company (in consultation with the Administrative Agent) shall
specify the time period within which each Lender is requested to respond (which
shall in no event be less than ten Business Days from the date of delivery of
such notice to the Lenders).
 
(b)           Lender Elections to Increase.  Each Lender shall notify the
Administrative Agent within such time period whether or not it agrees to
increase its Commitment and, if so, whether by an amount equal to, greater than,
or less than its Applicable Percentage of such requested increase.  Any Lender
not responding within such time period shall be deemed to have declined to
increase its Commitment.  No Lender shall be obligated to increase its
Commitment upon the Company’s request pursuant to this Section 2.16.
 
(c)           Notification by Administrative Agent; Additional Lenders.  The
Administrative Agent shall notify the Company and each Lender of the Lenders’
responses to each request made hereunder.  To the extent (i) one or more Lenders
have declined to increase their respective Commitments or have agreed to
increase their respective Commitments by an amount less than their respective
Applicable Percentages of a requested increase and (ii) one or more Lenders have
agreed to increase their respective Commitments by an amount greater than their
respective Applicable Percentages of such requested increase, the Company shall,
in its sole discretion, allocate the Commitments that would otherwise have been
allocated to the Lenders described in clause (i) above to one or more of the
Lenders described in clause (ii) above.  To the extent the Lenders have not
agreed to increase their respective Commitments in an amount sufficient to
provide the full amount of a requested increase, subject to the approval of the
Administrative Agent and the L/C Issuer (which approvals shall not be
unreasonably withheld), the Company may also invite additional Eligible
Assignees to become Lenders in order to provide, together with the existing
Lenders increasing their Commitments, the aggregate requested additional
Commitments.  In order to become a Lender, each such additional Eligible
Assignee shall execute and deliver to the Administrative Agent a joinder
agreement in form and substance satisfactory to the Administrative Agent and its
counsel.
 

 
4

--------------------------------------------------------------------------------

 

(d)           Effective Date and Allocations.  If the Aggregate Commitments are
increased in accordance with this Section, the Administrative Agent and the
Company shall determine the effective date (the “Increase Effective Date”) and
the final allocation of such increase.  The Administrative Agent shall promptly
notify the Company and the Lenders of the final allocation of such increase and
the Increase Effective Date.
 
(e)           Conditions to Effectiveness of Increase.  As a condition precedent
to such increase, the Company shall deliver to the Administrative Agent a
certificate of each Loan Party dated as of the Increase Effective Date (in
sufficient copies for each Lender) signed by a Responsible Officer of such Loan
Party (i) certifying and attaching the resolutions adopted by such Loan Party
approving or consenting to such increase, and (ii) in the case of the Company
and the Borrowers, certifying that, before and after giving effect to such
increase, (A) the representations and warranties of the Company and the
Borrowers contained in Article V and the representations and warranties of each
Loan Party contained in each other Loan Document are true and correct on and as
of the Increase Effective Date, except to the extent that such representations
and warranties specifically refer to an earlier date, in which case they are
true and correct as of such earlier date, and except that for purposes of this
Section 2.16, the representations and warranties contained in subsections (a)
and (b) of Section 5.05 shall be deemed to refer to the most recent statements
furnished pursuant to clauses (a) and (b), respectively, of Section 6.01, and
(B) no Default exists.  On each Increase Effective Date, (i) each relevant
Lender that is increasing its Commitment shall make available to the
Administrative Agent such amounts in immediately available funds as the
Administrative Agent shall determine, for the benefit of the other relevant
Lenders, as being required in order to cause, after giving effect to such
increase and the application of such amounts to make payments to such other
relevant Lenders, the outstanding Committed Loans (and risk participations in
outstanding Swing Line Loans, New Vehicle Swing Line Loans and L/C Obligations)
to be held ratably by all Lenders in accordance with their respective revised
Applicable Percentages, and (ii) the Revolving Borrower shall be deemed to have
prepaid and reborrowed the outstanding Committed Loans as of such Increase
Effective Date to the extent necessary to keep the outstanding Committed Loans
ratable with any revised Applicable Percentages arising from any nonratable
increase in the Commitments under this Section.
 
(f)           Conflicting Provisions.  This Section shall supersede any
provisions in Sections 2.14 or 10.01 to the contrary.
 
(k)  
The existing definition of “Eligible Vehicle Inventory” in Section 1.01 is
deleted in its entirety and the following is inserted in lieu thereof:

 
“Eligible Vehicle Inventory” means Vehicles of any Grantor that (a) in the case
of all such Vehicles, are subject to a perfected, first priority Lien in favor
of the Administrative Agent for the benefit of the Secured Parties pursuant to
the Security Instruments, free from any Lien other than (i) any Lien permitted
under
 

 
5

--------------------------------------------------------------------------------

 

Section 7.01(j) or 7.01(n) (provided, in each case, that the applicable Grantor
has remitted all payments necessary for the obligation secured by such Lien to
be irrevocably paid in full, including, without limitation, through the
authorization of a bank draft or electronic debit entry in the amount of such
secured obligation) (it being understood that, until such payment is made, any
Lien described in this clause (i) may be a first priority Lien) or (ii) any
other Lien to which the Administrative Agent consents in writing in its sole
discretion, (b) in the case of Used Vehicles, are properly titled in such
Grantor’s name or the certificates of title for such Vehicles are endorsed in
blank by the prior owners and such Grantor physically holds such certificates of
title (or such Grantor has, in accordance with its standard policies and
procedures, initiated the process by which the requirements of this clause (b)
will be satisfied) and (c) in the case of all such Vehicles, are located at such
Grantor’s facilities (except as set forth in Section 6.14).
 
(l)  
The existing definition of “Vehicle” in Section 1.01 is deleted in its entirety
and the following is inserted in lieu thereof:

 
“Vehicle” means an automobile or truck with a gross vehicle weight of less than
16,000 pounds which satisfies the following requirements:  (a) the vehicle is
owned by a Grantor free of any title defects or any liens or interests of others
except the security interest in favor of the Administrative Agent for the
benefit of the Secured Parties, Liens on vehicles permitted under Section
7.01(j) or 7.01(n) and other Liens to which the Administrative Agent consents in
writing in its sole discretion; (b) except as set forth in Section 6.14, the
vehicle is located at one of the locations identified in Schedule 6.14; and (c)
the vehicle is held for sale in the ordinary course of a Grantor’s business and
is of good and merchantable quality.
 
(m)  
Clause (j) of Section 7.01 is deleted in its entirety and the following is
inserted in lieu thereof:

 
(j)            Liens securing Indebtedness in respect of capital leases,
Synthetic Lease Obligations and purchase money obligations for fixed or capital
assets or for Vehicles acquired at auction; provided that (i) such Liens do not
at any time encumber any property other than the property financed by such
Indebtedness, and (ii) the Indebtedness secured thereby does not exceed the cost
or fair market value, whichever is lower, of the property being acquired on the
date of acquisition;
 
(n)  
Clause (n) of Section 7.01 is deleted in its entirety and the following is
inserted in lieu thereof:

 
(n)           Liens on Vehicles purchased directly from consumers or on specific
property acquired pursuant to an Acquisition permitted by Section 7.10, provided
that (i) such Liens were in existence at the time of such purchase or
Acquisition, (ii) no such Lien extends to any property other than the property
purchased or
 

 
6

--------------------------------------------------------------------------------

 

acquired, and (iii) no Lien on property acquired pursuant to a permitted
Acquisition attaches to any Collateral, and provided further that the aggregate
fair market value of all properties acquired pursuant to permitted Acquisitions
and subject to Liens permitted by this clause (n) does not exceed $15,000,000 at
any time;
 
(o)  
The existing Schedule 2.01 is deleted it in its entirety and Schedule 2.01
attached hereto is inserted in lieu thereof;

 
(p)  
The form of Borrowing Base Certificate attached as Exhibit F to the Credit
Agreement is hereby deleted and the attached Exhibit F inserted in place thereof
and in substitution therefor; and

 
(q)  
The form of Borrowing Base Schedule attached as Exhibit G to the Credit
Agreement is hereby deleted and the attached Exhibit G inserted in place thereof
and in substitution therefor.

 
(r)  
The form of Schedule 2 to Exhibit E attached to the Credit Agreement is hereby
deleted and the attached Schedule 2 inserted in place thereof and in
substitution therefor.

 
2. Joinder of the Joining Lenders; Funding of Loans with Incremental
Commitments.
 
(a) By its execution of this Amendment, each Joining Lender hereby confirms and
agrees that, on and after the date this Amendment becomes effective (the
“Amendment Effective Date”), it shall be and become a party to the Credit
Agreement as a Lender, and shall have all of the rights and be obligated to
perform all of the obligations of a Lender thereunder with the Commitment
applicable to such Lender identified on Schedule 2.01 attached hereto.  Each
Joining Lender further (i) acknowledges that it has received a copy of the
Credit Agreement and the schedules and exhibits thereto and such other documents
and information as it has deemed appropriate to make its own credit and legal
analysis and decision to enter into this Amendment; and (ii) agrees that it
will, independently and without reliance upon the Administrative Agent, the L/C
Issuer, any other Lender or, other than reliance on the representations and
warranties set forth herein, in the other Loan Documents and the deliveries
hereunder and thereunder, the Company, Borrowers or the Subsidiary Guarantors,
and based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit and legal decisions in taking or not
taking action under the Credit Agreement and the other Loan Documents.  On and
after the Amendment Effective Date, all references to the “Lenders” in the
Credit Agreement shall be deemed to include the Joining Lenders.
 

 
7

--------------------------------------------------------------------------------

 

(b) On the Amendment Effective Date, (i) each Existing Lender that is increasing
its Commitment and each Joining Lender shall make available to the
Administrative Agent such amounts in immediately available funds as the
Administrative Agent shall determine, for the benefit of the other relevant
Lenders, as being required in order to cause, after giving effect to such
increase and joinder and the application of such amounts to make payments to
such other relevant Existing Lenders, the outstanding Committed Loans (and risk
participations in outstanding Swing Line Loans, New Vehicle Swing Line Loans and
L/C Obligations) to be held ratably by all Lenders in accordance with their
respective Applicable Percentages (as revised by this Amendment), and (ii) the
Revolving Borrower shall be deemed to have prepaid and reborrowed the
outstanding Committed Loans as of the Amendment Effective Date to the extent
necessary to keep the outstanding Committed Loans ratable with any revised
Applicable Percentages arising from any nonratable increase in the Commitments
under this Amendment and the joinder of the Joining Lenders.
 
3. Effectiveness; Conditions Precedent.  The effectiveness of this Amendment and
the amendments to the Credit Agreement herein provided are subject to the
satisfaction of the following conditions precedent:
 
(a) the Administrative Agent shall have received each of the following documents
or instruments in form and substance reasonably acceptable to the Administrative
Agent:
 
(i) counterparts of this Amendment, duly executed by the Company, the
Administrative Agent, the Borrowers, the Subsidiary Guarantors, each of the
Existing Lenders and each of the Joining Lenders (which Existing Lenders and
Joining Lenders are listed on Schedule 2.01 attached hereto);
 
(ii) evidence of the existence, good standing, authority and capacity of the
Company and the Borrowers to execute, deliver and perform its obligations under
the Credit Agreement as amended hereby, including, (x) a true and complete copy
of resolutions for each of the Borrowers and the Company approving the
amendments contemplated hereby, and (y) a certification that the certificate of
incorporation, articles of organization, by-laws or operating agreement, as
applicable, of each of the Borrowers and the Company have not been amended or
otherwise modified since the effective date of the Credit Agreement or, in the
alternative, attaching true and complete copies of all amendments and
modifications thereto; and
 
(iii) such other documents, instruments, opinions, certifications, undertakings,
further assurances and other matters as the Administrative Agent, the L/C Issuer
or any Lender shall reasonably request;
 
(b) the Company shall have paid the fees in the amounts and at the times
specified in the letter agreement, dated as of November 9, 2006, among the
Company, the Administrative Agent and BAS (the “Amendment Fee Letter”); and
 

 
8

--------------------------------------------------------------------------------

 

(c) unless waived by the Administrative Agent, all fees and expenses payable to
the Administrative Agent and the Lenders (including the fees and expenses of
counsel to the Administrative Agent to the extent invoiced prior to the date
hereof) estimated to date shall have been paid in full (without prejudice to
final settling of accounts for such fees and expenses).
 
4. Consent of the Subsidiary Guarantors.  Each of the Subsidiary Guarantors
hereby consents, acknowledges and agrees to the amendments set forth herein and
hereby confirms and ratifies in all respects the Subsidiary Guaranty Agreement
(including without limitation the continuation of such Subsidiary Guarantor’s
payment and performance obligations thereunder upon and after the effectiveness
of this Amendment and the amendments contemplated hereby) and the enforceability
of the Subsidiary Guaranty Agreement against such Subsidiary Guarantor in
accordance with its terms.
 
5. Consent of the Company Guarantor.  The Company hereby consents, acknowledges
and agrees to the amendments set forth herein and hereby confirms and ratifies
in all respects the Company Guaranty Agreement (including without limitation the
continuation of the Company’s payment and performance obligations thereunder
upon and after the effectiveness of this Amendment and the amendments
contemplated hereby) and the enforceability of the Company Guaranty Agreement
against the Company in accordance with its terms.
 
6. Representations and Warranties.  In order to induce the Administrative Agent,
the Existing Lenders and the Joining Lenders to enter into this Amendment, each
of the Company and the Borrowers represent and warrant to the Administrative
Agent, the Existing Lenders and the Joining Lenders as follows:
 
(a) Before and after giving effect to this Amendment, (A) the representations
and warranties of the Company and the Borrowers contained in Article V and the
representations and warranties of each Loan Party contained in each other Loan
Document are true and correct on and as of the Amendment Effective Date, except
to the extent that such representations and warranties specifically refer to an
earlier date, in which case they are true and correct as of such earlier date,
and except that the representations and warranties contained in subsections (a)
and (b) of Section 5.05 of the Credit Agreement shall be deemed to refer to the
most recent statements furnished pursuant to clauses (a) and (b), respectively,
of Section 6.01 of the Credit Agreement, and (B) no Default exists;
 
(b) Since the date of the most recent financial reports of the Company and its
Subsidiaries delivered pursuant to Section 6.01(a) of the Credit Agreement,
there has been no event or circumstance, either individually or in the
aggregate, that has had or would reasonably be expected to have a Material
Adverse Effect;
 
(c) The Subsidiary Guarantors are the only Persons that are required to be a
party to the Subsidiary Guaranty Agreement pursuant to the terms of the Credit
Agreement; and
 

 
9

--------------------------------------------------------------------------------

 

(d) This Amendment has been duly authorized, executed and delivered by the
Company, each of the Borrowers and each of the Subsidiary Guarantors and
constitutes a legal, valid and binding obligation of such parties, except as may
be limited by general principles of equity or by the effect of any applicable
bankruptcy, insolvency, reorganization, moratorium or similar law affecting
creditors’ rights generally.
 
7. Entire Agreement.  This Amendment, together with the Amendment Fee Letter and
the Loan Documents (collectively, the “Relevant Documents”), sets forth the
entire understanding and agreement of the parties hereto in relation to the
subject matter hereof and supersedes any prior negotiations and agreements among
the parties relating to such subject matter.  No promise, condition,
representation or warranty, express or implied, not set forth in the Relevant
Documents shall bind any party hereto, and no such party has relied on any such
promise, condition, representation or warranty.  Each of the parties hereto
acknowledges that, except as otherwise expressly stated in the Relevant
Documents, no representations, warranties or commitments, express or implied,
have been made by any party to any other party in relation to the subject matter
hereof or thereof.  None of the terms or conditions of this Amendment may be
changed, modified, waived or canceled orally or otherwise, except in writing and
in accordance with Section 10.01 of the Credit Agreement.
 
8. Full Force and Effect of Agreement.  Except as hereby specifically amended,
modified or supplemented, the Credit Agreement and all other Loan Documents are
hereby confirmed and ratified in all respects and shall be and remain in full
force and effect according to their respective terms.
 
9. Counterparts.  This Amendment may be executed in any number of counterparts,
each of which shall be deemed an original as against any party whose signature
appears thereon, and all of which shall together constitute one and the same
instrument.  Delivery of an executed counterpart of a signature page of this
Amendment by telecopy shall be effective as a manually executed counterpart of
this Amendment.
 
10. Governing Law.  This Amendment shall in all respects be governed by, and
construed in accordance with, the laws of the State of New York applicable to
contracts executed and to be performed entirely within such State, and shall be
further subject to the provisions of Sections 10.14 and 10.15 of the Credit
Agreement.
 
11. Enforceability.  Should any one or more of the provisions of this Amendment
be determined to be illegal or unenforceable as to one or more of the parties
hereto, all other provisions nevertheless shall remain effective and binding on
the parties hereto.
 
12. References.  All references in any of the Loan Documents to the “Credit
Agreement” shall mean the Credit Agreement, as amended hereby, and as otherwise
amended, modified, supplemented or restated from time to time by any other
instrument in accordance with the terms thereof.
 

 
10

--------------------------------------------------------------------------------

 

13. Successors and Assigns.  This Amendment shall be binding upon and inure to
the benefit of the Company, the Administrative Agent, the Borrowers, the
Subsidiary Guarantors, the Lenders and their respective successors, legal
representatives, and assignees to the extent such assignees are permitted
assignees as provided in Section 10.06 of the Credit Agreement.
 

[Signature pages follow]

 
11

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, the parties hereto have caused this instrument to be made,
executed and delivered by their duly authorized officers as of the day and year
first above written.
 
COMPANY:
 
 
CARMAX, INC.
 
By:/s/ Keith D. Browning
Name: Keith D. Browning
Title: Executive Vice President
 
 
BORROWERS:
 
 
CARMAX AUTO SUPERSTORES, INC.
 
By:/s/ Keith D. Browning
Name: Keith D. Browning
Title: Executive Vice President
 
 
CARMAX OF LAUREL, LLC
 
By:/s/ Keith D. Browning
Name: Keith D. Browning
Title: President
 
 
CARMAX AUTO MALL, LLC
 
By:/s/ Keith D. Browning
Name: Keith D. Browning
Title: President
 
 
CARMAX AUTO SUPERSTORES CALIFORNIA, LLC
 
By:/s/ Keith D. Browning
Name: Keith D. Browning
Title: Executive Vice President
 

Signature Page to Amendment No. 1
to Credit Agreement and Joinder Agreement
 
 

--------------------------------------------------------------------------------

 

 
COMPANY GUARANTOR:
 
CARMAX, INC.
 
By:/s/ Keith D.
Browning                                                                           
Name: Keith D.
Browning                                                                           
Title: Executive Vice
President                                                                           
 
 
SUBSIDIARY GUARANTORS:
 
CARMAX OF LAUREL, LLC

By:/s/ Keith D.
Browning                                                                           
Name: Keith D.
Browning                                                                           
Title:
President                                                                           
 
CARMAX AUTO MALL, LLC

By:/s/ Keith D.
Browning                                                                           
Name: Keith D.
Browning                                                                           
Title:
President                                                                           
 
CARMAX AUTO SUPERSTORES CALIFORNIA, LLC

By:/s/ Keith D.
Browning                                                                           
Name: Keith D.
Browning                                                                           
Title: Executive Vice
President                                                                           
 
CARMAX BUSINESS SERVICES, LLC

By:/s/ Keith D.
Browning                                                                           
Name: Keith D.
Browning                                                                           
Title: Executive Vice
President                                                                           
 

Signature Page to Amendment No. 1
to Credit Agreement and Joinder Agreement

 
 
 
 

--------------------------------------------------------------------------------

 

CARMAX AUTO SUPERSTORES WEST COAST, INC.

By:/s/ Keith D.
Browning                                                                           
Name: Keith D.
Browning                                                                           
Title: Executive Vice
President                                                                           
 
CARMAX PROPERTIES, LLC

By:/s/ Keith D.
Browning                                                                           
Name: Keith D.
Browning                                                                           
Title:
President                                                                           
 
 
Signature Page to Amendment No. 1
to Credit Agreement and Joinder Agreement

 
 

--------------------------------------------------------------------------------

 

CARMAX AUTO SUPERSTORES SERVICES, INC.
 
By:/s/ Keith D. Browning 
Name: Keith D.
Browning                                                                           
Title: Executive Vice
President                                                                           
 

 

Signature Page to Amendment No. 1
to Credit Agreement and Joinder Agreement
 
 
 

--------------------------------------------------------------------------------

 

 
ADMINISTRATIVE AGENT:
 
BANK OF AMERICA, N.A., as
Administrative Agent
 
By: /s/ Kristine
Thennes                                                                           
Name: Kristine
Thennes                                                                           
Title: Vice President                              
 
 
 
 
 
                                             

Signature Page to Amendment No. 1
to Credit Agreement and Joinder Agreement
 
 
 

--------------------------------------------------------------------------------

 

EXISTING LENDERS:
 
 
BANK OF AMERICA, N.A., as a Lender, L/C Issuer, Swing Line Lender and New
Vehicle Swing Line Lender
 
By: /s/ M. Patricia
Kay                                                                           
Name:  M. Patricia
Kay                                                                           
Title:  Senior Vice
President                                                                           
 
 
 
 

Signature Page to Amendment No. 1
to Credit Agreement and Joinder Agreement

 
 
 
 

--------------------------------------------------------------------------------

 

JPMORGAN CHASE BANK, N.A., as a Lender
 
By: /s/ H. David
Jones                                                                           
Name: H. David
Jones                                                                           
Title: Vice
President                                                                           
 
 
 
 
 
 
 
 

 
Signature Page to Amendment No. 1
to Credit Agreement and Joinder Agreement

 
 
 
 

--------------------------------------------------------------------------------

 

WACHOVIA BANK, NATIONAL ASSOCIATION, as a Lender
 
By: /s/ Mark S.
Supple                                                                           
Name: Mark S.
Supple                                                                           
Title: Vice
President                                                                           
 
 
 
 
 
 
 

 
Signature Page to Amendment No. 1
to Credit Agreement and Joinder Agreement

 
 
 
 

--------------------------------------------------------------------------------

 

SUNTRUST BANK, as a Lender
 
By: /s/ Mark A.
Flatin                                                                           
Name: Mark A.
Flatin                                                                           
Title: Managing
Director                                                                           
 
 
 
 
 

 
Signature Page to Amendment No. 1
to Credit Agreement and Joinder Agreement
 
 
 

--------------------------------------------------------------------------------

 

TOYOTA MOTOR CREDIT CORPORATION, as a Lender
 
By: /s/ William
Shiao                                                                           
Name: William
Shiao                                                                           
Title: National Dealer Credit
Manager                                                                           
 
 
 

 
Signature Page to Amendment No. 1
to Credit Agreement and Joinder Agreement
 
 
 

--------------------------------------------------------------------------------

 

WELLS FARGO BANK, N.A., as a Lender
 
By: /s/ Peter W.
Clark                                                                           
Name: Peter W.
Clark                                                                           
Title: Vice
President                                                                           
 
 
 

 
Signature Page to Amendment No. 1
to Credit Agreement and Joinder Agreement

 
 
 
 

--------------------------------------------------------------------------------

 

SCOTIABANC, INC., as a Lender
 
By: /s/ William E.
Zarrett                                                                           
Name: William E.
Zarrett                                                                           
Title: Managing Director                                     
 
 
 
 
                                      

Signature Page to Amendment No. 1
to Credit Agreement and Joinder Agreement

 
 
 
 

--------------------------------------------------------------------------------

 

CREDIT SUISSE, CAYMAN ISLAND BRANCH, as a Lender
 
By: /s/ Cassandra
Droogan                                                                           
Name: Cassandra
Droogan                                                                           
Title: Vice
President                                                                           

 
By: /s/ Mikhail
Faybusovich                                                                           
Name: Mikhail
Faybusovich                                                                           
Title:
Associate                                                                           
 
 
 
 

 
Signature Page to Amendment No. 1
to Credit Agreement and Joinder Agreement

 
 
 
 

--------------------------------------------------------------------------------

 

ROYAL BANK OF CANADA, as a Lender
 
By: /s/ Scott
Umbs                                                                           
Name: Scott
Umbs                                                                           
Title: Authorized
Signatory                                                                           
 
 
 
 
 

 
Signature Page to Amendment No. 1
to Credit Agreement and Joinder Agreement
 
 
 

--------------------------------------------------------------------------------

 

U.S. BANK NATIONAL ASSOCIATION, as
a Lender
 
By: /s/ Scott E.
Mitchell                                                                           
Name: Scott E.
Mitchell                                                                           
Title: Vice
President                                                                           

 
 
 

 
Signature Page to Amendment No. 1
to Credit Agreement and Joinder Agreement
 
 

--------------------------------------------------------------------------------

 

FIFTH THIRD BANK, as a Lender
 
By: /s/ Mark
Olson                                                                           
Name: Mark
Olson                                                                           
Title: Vice
President                                                                           

 
 
 
 
 
 
 

 
Signature Page to Amendment No. 1
to Credit Agreement and Joinder Agreement
 
 

--------------------------------------------------------------------------------

 

JOINING LENDERS:

 
COMERICA BANK, as a Joining Lender
By: /s/ Joseph M. Davignon 
Name: Joseph M.
Davignon                                                                           
Title: First Vice
President                                                                           

 
 

 
Signature Page to Amendment No. 1
to Credit Agreement and Joinder Agreement
 
 

--------------------------------------------------------------------------------

 

SCHEDULE 2.01

 
COMMITMENTS
AND APPLICABLE PERCENTAGES

Lender
 
Commitment
 
Applicable
Percentage
Bank of America, N.A.
$
81,000,000.00
 
16.200000000%
JPMorgan Chase Bank, N.A.
 
53,000,000.00
 
10.600000000%
Wachovia Bank, National Association
 
53,000,000.00
 
10.600000000%
SunTrust Bank
 
53,000,000.00
 
10.600000000%
Toyota Motor Credit Corporation
 
50,000,000.00
 
10.000000000%
Wells Fargo Bank, N.A.
 
30,000,000.00
 
6.000000000%
Scotiabanc, Inc.
 
30,000,000.00
 
6.000000000%
Credit Suisse, Cayman Island Branch
 
30,000,000.00
 
6.000000000%
Royal Bank of Canada
 
30,000,000.00
 
6.000000000%
U.S. Bank National Association
 
30,000,000.00
 
6.000000000%
Fifth Third Bank
 
30,000,000.00
 
6.000000000%
Comerica Bank
 
30,000,000.00
 
6.000000000%
Total
$
500,000,000.00
 
100.000000000%

 
 

--------------------------------------------------------------------------------

 

EXHIBIT E
Schedule 2

For the Quarter/Year ended ___________________(“Statement Date”)
 
SCHEDULE 2
to the Compliance Certificate
($ in 000’s)

I.
Section 7.09 (b) – Consolidated Total Liabilities to Consolidated Tangible Net
Worth Ratio.
   
A.
Consolidated Total Liabilities at Statement Date:
     
1. Consolidated current liabilities at Statement Date:
$_______
   
2. Consolidated long-term liabilities at Statement Date:
$_______
     
3. Consolidated contingent liabilities (without duplication of Line I.A.1 or 2)
at Statement Date:
$_______
 
   
4. Synthetic Lease Obligations (without duplication of Line I.A.1 or 2) at
Statement Date:
$_______
     
5. Other Off-Balance Sheet Liabilities (without duplication of Line I.A.1 or 2)
at Statement Date:
$_______
     
6. Consolidated Total Liabilities (Line I.A.1 + 2 + 3 + 4 + 5):
$_______
   
B.
Consolidated Tangible Net Worth at Statement Date:
       
1. Shareholders’ Equity at Statement Date:
$_______
     
2. Intangible Assets at Statement Date:
$_______
     
3. Consolidated Tangible Net Worth (Line I.B.1 – 2):
$_______
   
C.
Consolidated Total Liabilities to Tangible Net Worth (Line I.A.6 ÷ Line I.B.3):
  _______ to 1.00
 
Maximum permitted:
 1.30 to 1.00
 

II.
Section 7.09 (c) – Consolidated Fixed Charge Coverage Ratio.
     
A.
Consolidated EBITDAR for four consecutive fiscal quarters ending on above date
(“Subject Period”):
       
1.Consolidated Net Income for Subject Period:
$_______
     
2.Consolidated Interest Charges for Subject Period:
$_______
     
3.Provision for income taxes payable for Subject Period:
$_______
     
4.Depreciation expenses for Subject Period:
$_______
 

 
 

--------------------------------------------------------------------------------

 

 

   
5. Amortization expenses for Subject Period:
$_______
     
6. Share based compensation expense reducing Consolidated Net Income for Subject
Period:
$_______
     
7. Other non-recurring non-cash expenses reducing Consolidated Net Income for
Subject Period:
$_______
     
8. Income tax credits for Subject Period:
$_______
     
9. Non-cash items increasing Consolidated Net Income for Subject Period:
$_______
     
10.Consolidated EBITDA (Lines II.A.1 + 2 + 3 + 4 + 5 + 6 +7 – 8 – 9):
$_______
     
11. Consolidated Rental Obligations for Subject Period:
$_______
     
12. Consolidated EBITDAR (Lines II.A.10 + 11):
$_______
             
B.
Consolidated Fixed Charges for Subject Period:
       
1. Consolidated Interest Charges for Subject Period (Line II.A.2 above):
$_______
     
2. Consolidated Rental Obligations for Subject Period (Line II.A.11 above):
$_______
     
3. Income taxes paid in cash for Subject Period:
$_______
     
4. Consolidated Scheduled Principal Payments for Subject Period (excluding any
scheduled payments of principal that were (i) paid during the Subject Period
with the proceeds of replacement Indebtedness or (ii) deferred to a later period
by an appropriate written amendment, but including payments of principal that
were deferred to the Subject Period):
$_______
     
5. Consolidated Fixed Charges for Subject Period (Line II.B.1 + 2 + 3 + 4):
$_______
          _______ to 1.00    
C.
Consolidated Fixed Charge Coverage Ratio (Line II.A.12 ÷ Line II.B.5):
 
 
Minimum required:
 1.25 to 1.00
 

 
 

--------------------------------------------------------------------------------

 

EXHIBIT F

FORM OF BORROWING BASE CERTIFICATE

To:           Bank of America, N.A., as Administrative Agent
 
Ladies and Gentlemen:
 
Reference is made to that certain Credit Agreement, dated as of August 24, 2005
(as amended, restated, extended, supplemented or otherwise modified in writing
from time to time, the “Agreement;” the terms defined therein being used herein
as therein defined), among CarMax Auto Superstores, Inc., a Virginia
corporation, as Revolving Borrower, CarMax, Inc., a Virginia corporation (the
“Company”), the Designated Borrowers from time to time party thereto, the
Lenders from time to time party thereto, and Bank of America, N.A., as
Administrative Agent, L/C Issuer, Swing Line Lender and New Vehicle Swing Line
Lender.
 
The undersigned Responsible Officer of the Company hereby certifies as of the
date hereof that at the close of business on [____________] (the “Calculation
Date”) the Borrowing Base was $__________, computed as set forth on the schedule
attached hereto.
 

 

 
CARMAX INC.
     
By:                         (Seal) 
 
Its:
 
Date:

                                                            

 
 

--------------------------------------------------------------------------------

 

EXHIBIT G

FORM OF BORROWING BASE SCHEDULE

 
 

 carmax logo [exhibit1020ii.jpg]  

 

 
    Borrowing Base
       
[INSERT DATE]
                   
Location Number
Location name
New
Used
Wholesale
Total
 
[INSERT]
[INSERT]
[INSERT]
[INSERT]
[INSERT]
[INSERT]
                                                                               
                   
 Less: Vehicles – accounts payable:
                            Totals
 
                           
           NOTICE OF CONFIDENTIALITY
       
This report may contain confidential information.
     
             Duplication is strictly prohibited.