Document:

Receivables Purchase Agreement

  
 Exhibit 10.3

 EXHIBIT 10.3 – RECEIVABLES PURCHASE AGREEMENT 
 [EXECUTION COPY] 
 CARMAX BUSINESS SERVICES, LLC, 

as Seller, 
 and

 CARMAX AUTO FUNDING LLC, 
 as Purchaser 
  

 
 RECEIVABLES
PURCHASE AGREEMENT 
 Dated as of November 1, 2010 

 
  

  
 TABLE OF CONTENTS

  

							
	 	  	 	  	Page	 
		  	 ARTICLE I
 DEFINITIONS
	  			
			
	SECTION 1.1	  	Definitions	  	 	1	  
	SECTION 1.2	  	Other Definitional Provisions	  	 	4	  
			
		  	 ARTICLE II
 CONVEYANCE OF RECEIVABLES
	  			
	  	  
			
	SECTION 2.1	  	Sale and Conveyance of Receivables	  	 	4	  
	SECTION 2.2	  	Receivables Purchase Price; Payments on the Receivables	  	 	5	  
	SECTION 2.3	  	Transfer of Receivables	  	 	5	  
	SECTION 2.4	  	Examination of Receivable Files	  	 	6	  
	SECTION 2.5	  	Expenses	  	 	6	  
			
		  	 ARTICLE III
 REPRESENTATIONS AND WARRANTIES
	  			
	  	  
			
	SECTION 3.1	  	Representations and Warranties of the Purchaser	  	 	6	  
	SECTION 3.2	  	Representations and Warranties of the Seller	  	 	7	  
			
		  	 ARTICLE IV
 CONDITIONS
	  			
	  	  
			
	SECTION 4.1	  	Conditions to Obligation of the Purchaser	  	 	13	  
	SECTION 4.2	  	Conditions to Obligation of the Seller	  	 	14	  
			
		  	 ARTICLE V
 COVENANTS OF THE SELLER
	  			
	  	  
			
	SECTION 5.1	  	Protection of Right, Title and Interest in, to and Under the Receivables	  	 	15	  
	SECTION 5.2	  	Security Interests	  	 	16	  
	SECTION 5.3	  	Delivery of Payments	  	 	16	  
	SECTION 5.4	  	No Impairment	  	 	16	  
	SECTION 5.5	  	Costs and Expenses	  	 	16	  
	SECTION 5.6	  	Hold Harmless	  	 	17	  
			
		  	 ARTICLE VI
 MISCELLANEOUS PROVISIONS
	  			
	  	  
			
	SECTION 6.1	  	Amendment	  	 	17	  
	SECTION 6.2	  	Termination	  	 	17	  
	SECTION 6.3	  	Governing Law	  	 	18	  
	SECTION 6.4	  	Notices	  	 	18	  
	SECTION 6.5	  	Severability of Provisions	  	18	 

							
	 	  	 	  	Page	 
			
	SECTION 6.6	  	Further Assurances	  	 	18	  
	SECTION 6.7	  	No Waiver; Cumulative Remedies	  	 	18	  
	SECTION 6.8	  	Counterparts	  	 	18	  
	SECTION 6.9	  	Third-Party Beneficiaries	  	 	18	  
	SECTION 6.10	  	Headings and Table of Contents	  	 	19	  
	SECTION 6.11	  	Representations, Warranties and Agreements to Survive	  	 	19	  
	SECTION 6.12	  	No Proceedings	  	 	19	  
	SECTION 6.13	  	Accountant’s Letters	  	 	19	  
	SECTION 6.14	  	Obligations of Purchaser	  	 	19	  
			
		  	SCHEDULES	  			
	SCHEDULE A	  	Receivables Schedule	  			
			
		  	EXHIBITS	  			
			
	EXHIBIT A	  	Bill of Sale and Assignment	  			
	EXHIBIT B	  	Form of Retail Installment Sale Contract	  			

  
 RECEIVABLES PURCHASE
AGREEMENT 
 This Receivables Purchase Agreement, dated as of November 1, 2010, is between CarMax Business Services, LLC, a
Delaware limited liability company (“CarMax”), as seller (the “Seller”), and CarMax Auto Funding LLC, a Delaware limited liability company (“CarMax Funding”), as purchaser (the
“Purchaser”). 
 WHEREAS, in the regular course of business, CarMax Auto Superstores, Inc., a Virginia
corporation (“CarMax Auto”), and certain affiliates of CarMax Auto originate motor vehicle retail installment sale contracts secured by new and used motor vehicles; 

WHEREAS, the Seller intends to convey all of its right, title and interest in and to contracts having an aggregate outstanding principal
balance of $650,000,011.40 as of the close of business on October 31, 2010 (the “Receivables”) to the Purchaser and, concurrently with its purchase of the Receivables, the Purchaser intends to convey all of its right, title and
interest in and to the Receivables to CarMax Auto Owner Trust 2010-3, as issuer (the “Issuer”), pursuant to a Sale and Servicing Agreement, dated as of November 1, 2010 (the “Sale and Servicing Agreement”),
among the Issuer, CarMax Funding, as depositor, CarMax, as servicer, and Wells Fargo Bank, National Association, a national banking association, as backup servicer; and 
 WHEREAS, the Seller and the Purchaser wish to set forth the terms pursuant to which the Receivables are to be sold by the Seller to the Purchaser; 

NOW, THEREFORE, in consideration of the mutual terms and covenants contained herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows: 
 ARTICLE I 

DEFINITIONS 

SECTION 1.1 Definitions. Whenever used in this Agreement, the following words and phrases shall have the following meanings:

 “Agreement” shall mean this Receivables Purchase Agreement and all amendments hereof and supplements hereto.

 “Base Prospectus” shall mean the prospectus, dated October 27, 2010, of the Purchaser relating to the
public offering by the Purchaser of the Notes. 
 “Bill of Sale” shall mean the Bill of Sale and Assignment,
substantially in the form attached as Exhibit A. 
 “CarMax” shall mean CarMax Business Services, LLC, a
Delaware limited liability company, and its successors. 
 “CarMax Auto” shall mean CarMax Auto Superstores,
Inc., a Virginia corporation, and its successors. 

  
 “CarMax
Funding” shall mean CarMax Auto Funding LLC, a Delaware limited liability company, and its successors. 

“CarMax Funding II” shall mean CarMax Funding II, LLC, a Delaware limited liability company, and its successors.

 “Class A Notes” shall mean the Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and
the Class A-4 Notes issued pursuant to the Indenture. 
 “Class B Notes” shall mean the Class B Notes
issued pursuant to the Indenture. 
 “Class C Notes” shall mean the Class C Notes issued pursuant to the
Indenture. 
 “Class D Notes” shall mean the Class D Notes issued pursuant to the Indenture. 

“Closing Date” shall mean November 10, 2010. 

“Cutoff Date” shall mean October 31, 2010. 

“Delaware Trustee” shall mean BNY Mellon Trust of Delaware, a Delaware banking corporation, as Delaware trustee under
the Trust Agreement, and its successors in such capacity. 
 “Depositor” shall mean CarMax Funding, in its
capacity as Depositor under the Trust Agreement, and its successors in such capacity. 
 “Indenture” shall mean
the Indenture, dated as of November 1, 2010, between the Issuer and the Indenture Trustee, as amended, supplemented or otherwise modified and in effect from time to time. 
 “Indenture Trustee” shall mean Wells Fargo Bank, National Association, a national banking association, as indenture trustee under the Indenture, and its successors in such capacity.

 “Initial Reserve Account Deposit” shall mean $1,625,000. 

“Issuer” shall mean CarMax Auto Owner Trust 2010-3, a Delaware statutory trust, and its successors. 

“Noteholders” shall mean the registered holders of the Notes. 

“Notes” shall mean the Class A Notes, the Class B Notes, the Class C Notes and the Class D Notes. 

“Owner Trustee” shall mean The Bank of New York Mellon, a New York banking corporation, as owner trustee under the Trust
Agreement, and its successors in such capacity. 

  
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 “Prospectus
Supplement” shall mean the final prospectus supplement, dated November 3, 2010, of the Purchaser relating to the public offering by the Purchaser of the Class A Notes, the Class B Notes, the Class C Notes and the Class D Notes.

 “Prospectus” shall mean the Prospectus Supplement and the Base Prospectus. 

“Purchaser” shall mean CarMax Funding, in its capacity as purchaser of the Receivables under this Agreement, and its
successors in such capacity. 
 “Receivables” shall mean the motor vehicle retail installment sale contracts
sold by the Seller to the Purchaser pursuant to this Agreement and identified on the Receivables Schedule. 

“Receivables Purchase Price” shall mean $669,500,011.74. 

“Receivables Schedule” shall mean the schedule of receivables attached as Schedule A, as amended, supplemented or
otherwise modified and in effect from time to time. 
 “Representative” shall mean Barclays Capital Inc., a
Connecticut corporation, as representative of the Underwriters. 
 “Sale and Servicing Agreement” shall have
the meaning specified in the recitals. 
 “Seller” shall mean CarMax, in its capacity as seller of the
Receivables under this Agreement, and its successors in such capacity. 
 “State” shall mean any of the 50
states of the United States or the District of Columbia. 
 “Transaction Documents” shall mean this Agreement,
the Trust Agreement, the Sale and Servicing Agreement, the Indenture, the Administration Agreement and the other documents and certificates delivered in connection therewith, in each case as amended, supplemented or otherwise modified and in effect
from time to time. 
 “Trust Agreement” shall mean the Trust Agreement, dated as of July 26, 2010, among
CarMax Funding, the Delaware Trustee and the Owner Trustee, as amended and restated by the Amended and Restated Trust Agreement, dated as of November 1, 2010, among CarMax Funding, the Delaware Trustee and the Owner Trustee. 

“Trustee” shall mean either the Owner Trustee or the Indenture Trustee, as the context requires. 

“UCC” shall mean the Uniform Commercial Code as in effect in the applicable jurisdiction. 

“Underwriters” shall mean the underwriters named in Schedule A to the Underwriting Agreement. 

  
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 “Underwriting
Agreement” shall mean the Underwriting Agreement, dated November 3, 2010, among CarMax Funding, CarMax and the Representative, relating to the purchase of the Notes by the Underwriters from CarMax Funding. 

SECTION 1.2 Other Definitional Provisions. 
 (a) Capitalized terms used herein that are not otherwise defined shall have the meanings ascribed thereto in the Sale and Servicing Agreement. 

(b) The words “hereof”, “herein” and “hereunder” and words of similar import when used in this Agreement
shall refer to this Agreement as a whole and not to any particular provision of this Agreement; Section, subsection, Schedule and Exhibit references contained in this Agreement are references to Sections, subsections, Schedules and
Exhibits in or to this Agreement unless otherwise specified; the term “proceeds” shall have the meaning set forth in the applicable UCC; and the word “including” shall mean including without limitation. 

ARTICLE II 

CONVEYANCE OF RECEIVABLES 
 SECTION 2.1 Sale and Conveyance of Receivables. 
 (a) On the Closing Date,
subject to the terms and conditions of this Agreement, the Seller hereby agrees to sell, transfer, assign, set over and otherwise convey to the Purchaser, and the Purchaser hereby agrees to purchase from the Seller, without recourse (subject to the
Seller’s obligations hereunder and the satisfaction of the conditions set forth in Section 4.1), all of the right, title and interest of the Seller, whether now owned or hereafter acquired, in, to and under the following: 

(i) the Receivables; 
 (ii) all amounts received on or in respect of the Receivables (including proceeds of the repurchase of Receivables by the Seller pursuant to Section 3.2(f)) after the Cutoff Date; 

(iii) the security interests in the Financed Vehicles granted by the Obligors pursuant to the Receivables and any other
interest of the Seller in such Financed Vehicles; 
 (iv) all proceeds from claims on or refunds of premiums of
any physical damage or theft insurance policies covering the Financed Vehicles and any proceeds or refunds of premiums of any credit life or credit disability insurance policies relating to the Financed Vehicles or the Obligors; 

(v) the Receivable Files; 
 (vi) the right to realize upon any property (including the right to receive future Liquidation Proceeds) that shall have secured a Receivable and have been repossessed by or on behalf of the Issuer; and

  
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 (vii)
all present and future claims, demands, causes of action and choses in action in respect of any or all of the foregoing and all payments on or under and all proceeds of every kind and nature whatsoever in respect of any or all of the foregoing,
including all proceeds of the conversion thereof, voluntary or involuntary, into cash or other liquid property; all accounts, general intangibles, chattel paper, instruments, documents, money, investment property, deposit accounts, letters of
credit, letter-of-credit rights, insurance proceeds, condemnation awards, rights to payment of any and every kind and other forms of obligations; and all other property which at any time constitutes all or part of or is included in the proceeds of
any of the foregoing. 
 (b) The parties hereto intend that the conveyance of the Receivables and related property hereunder be
a sale and not a loan. In the event that the conveyance hereunder is not for any reason considered a sale, the Seller hereby grants to the Purchaser a first priority perfected security interest in all of the Seller’s right, title and interest
in, to and under the Receivables and all other property conveyed hereunder and listed in this Section and all proceeds of any of the foregoing. The parties intend that this Agreement constitute a security agreement under applicable law. Such
grant is made to secure the payment of all amounts payable hereunder, including the Receivables Purchase Price. If such conveyance is for any reason considered to be a loan and not a sale, the Seller consents to the Purchaser transferring such
security interest in favor of the Indenture Trustee and transferring the obligations secured thereby to the Indenture Trustee. 

(c) The Seller agrees to treat the transfer of the Receivables and the related property contemplated by this Section for all
purposes as an absolute transfer on all relevant books, records and other applicable documents. 
 SECTION 2.2 Receivables
Purchase Price; Payments on the Receivables. 
 (a) On the Closing Date, in exchange for the Receivables and other assets
described in Section 2.1, the Purchaser shall pay to the Seller the Receivables Purchase Price. An amount equal to $646,730,258.03 of the Receivables Purchase Price shall be paid by the Purchaser to the Seller in cash or immediately available
funds. The remainder of the Receivables Purchase Price shall be paid by crediting the Seller with a contribution to the capital of the Purchaser. The Purchaser shall deposit, from funds it receives from the issuance of the Notes, an amount equal to
the Initial Reserve Account Deposit into the Reserve Account, which amount shall be an asset of the Issuer. 
 (b) The Purchaser
shall be entitled to, and shall convey such right to the Owner Trustee pursuant to the Sale and Servicing Agreement, all payments of principal and interest on or in respect of the Receivables received after the Cutoff Date. 

SECTION 2.3 Transfer of Receivables. Pursuant to the Sale and Servicing Agreement, the Purchaser will assign all of its right,
title and interest in, to and under the Receivables and other assets described in Section 2.1 to the Issuer. The parties hereto acknowledge that the Issuer will pledge its rights in, to and under the Receivables and other assets described in
Section 2.1 to the Indenture Trustee pursuant to the Indenture. The Purchaser has the right to assign its interest under this Agreement as may be required to effect the purposes of the Sale and Servicing Agreement, without the consent of the
Seller, and the Owner Trustee as assignee shall succeed to the rights and obligations hereunder of the Purchaser. 

  
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 SECTION 2.4
Examination of Receivable Files. The Seller will make the Receivable Files available to the Purchaser or its agent for examination during normal business hours at the Seller’s offices or such other location as otherwise shall be agreed
upon by the Purchaser and the Seller. 
 SECTION 2.5 Expenses. The Seller will reimburse the Purchaser for expenses of
the Purchaser in connection with the sale of the Notes, including expenses which are reimbursable to the Underwriters by the Purchaser pursuant to the Underwriting Agreement. 
 ARTICLE III 
 REPRESENTATIONS AND WARRANTIES 

SECTION 3.1 Representations and Warranties of the Purchaser. The Purchaser hereby makes the following representations and
warranties to the Seller as of the date of this Agreement and as of the Closing Date: 
 (a) Organization and
Good Standing. The Purchaser is a limited liability company duly organized, validly existing and in good standing under the laws of the State of Delaware, and has power and authority to own its properties and to conduct its business as such
properties are currently owned and such business is presently conducted, and had at all relevant times, and shall have, power, authority and legal right to acquire, own and sell the Receivables. 

(b) Power and Authority; Binding Obligation. The Purchaser has the power and authority to execute and deliver this
Agreement and to carry out its terms; and the execution, delivery and performance of this Agreement has been duly authorized by the Purchaser by all necessary action. This Agreement constitutes the legal, valid and binding obligation of the
Purchaser, enforceable against the Purchaser in accordance with its terms, subject, as to enforceability, to applicable bankruptcy, insolvency, reorganization, conservatorship, receivership, liquidation and other similar laws and to general
equitable principles. 
 (c) No Violation. The consummation of the transactions contemplated by this
Agreement and the fulfillment of the terms hereof shall not conflict with, result in any breach of any of the terms and provisions of, nor constitute (with or without notice or lapse of time) a default under, the limited liability company agreement
or certificate of formation of the Purchaser, or conflict with or breach any of the material terms or provisions of, or constitute (with or without notice or lapse of time) a default under, any indenture, agreement or other instrument to which the
Purchaser is a party or by which it may be bound. 
 (d) No Proceedings. There are no proceedings or
investigations pending, or, to the knowledge of the Purchaser, threatened, against the Purchaser before any court, regulatory body, administrative agency or other tribunal or governmental instrumentality having jurisdiction over the Purchaser or its
properties (i) asserting the invalidity of this 

  
 6 

 
Agreement, (ii) seeking to prevent the consummation of any of the transactions contemplated by this Agreement or (iii) seeking any determination or ruling that, in the reasonable
judgment of the Purchaser would materially and adversely affect the performance by the Purchaser of its obligations under, or the validity or enforceability of, this Agreement or the Receivables. 

SECTION 3.2 Representations and Warranties of the Seller. 
 (a) The Seller hereby makes the following representations and warranties to the Purchaser as of the date of this Agreement and as of the Closing Date: 

(i) Organization and Good Standing. The Seller is a limited liability company duly organized, validly existing and
in good standing under the laws of the State of Delaware, and has power and authority to own its properties and to conduct its business as such properties are currently owned and such business is presently conducted, and had at all relevant times,
and shall have, power, authority and legal right to acquire, own and sell the Receivables. 
 (ii) Power and
Authority; Binding Obligation. The Seller has the power and authority to execute and deliver this Agreement and to carry out its terms; and the execution, delivery and performance of this Agreement has been duly authorized by the Seller by all
necessary action. This Agreement constitutes the legal, valid and binding obligation of the Seller, enforceable against the Seller in accordance with its terms, subject, as to enforceability, to applicable bankruptcy, insolvency, reorganization,
conservatorship, receivership, liquidation and other similar laws and to general equitable principles. 
 (iii)
No Violation. The consummation of the transactions contemplated by this Agreement and the fulfillment of the terms hereof shall not conflict with, result in any breach of any of the terms and provisions of, nor constitute (with or without
notice or lapse of time) a default under, the certificate of formation or limited liability company agreement of the Seller, or conflict with or breach any of the material terms or provisions of, or constitute (with or without notice or lapse of
time) a default under, any indenture, agreement or other instrument to which the Seller is a party or by which it may be bound. 
 (iv) No Proceedings. There are no proceedings or investigations pending, or, to the knowledge of the Seller, threatened, against the Seller before any court, regulatory body, administrative agency
or other tribunal or governmental instrumentality having jurisdiction over the Seller or its properties (i) asserting the invalidity of this Agreement, (ii) seeking to prevent the consummation of any of the transactions contemplated by
this Agreement or (iii) seeking any determination or ruling that, in the reasonable judgment of the Seller would materially and adversely affect the performance by the Seller of its obligations under, or the validity or enforceability of, this
Agreement or the Receivables. 
 (v) No Tax Liens. The Seller is not aware of any material judgment or tax
lien filings against the Seller. 

  
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 (b) The Seller hereby
makes the following representations and warranties to the Purchaser as of the date of this Agreement and as of the Closing Date, which representations and warranties shall remain operative and in full force and effect, shall survive the transfer and
conveyance of the Receivables and other assets described in Section 2.1 by the Seller to the Purchaser and by the Purchaser to the Issuer and shall inure to the benefit of the Purchaser, the Trustees and the Noteholders: 

(i) Characteristics of Receivables. Each Receivable (i) has been originated by CarMax Auto or an Affiliate of
CarMax Auto in the ordinary course of business in connection with the sale of a new or used motor vehicle and has been fully and properly executed by the parties thereto, (ii) contains customary and enforceable provisions such that the rights
and remedies of the holder thereof are adequate for realization against the collateral of the benefits of the security, (iii) provides for level monthly payments that fully amortize the Amount Financed by maturity (except that the period
between the date of such Receivable and the date of the first Scheduled Payment may be less than or greater than one month and the amount of the first and last Scheduled Payments may be less than or greater than the level payments) and yield
interest at the related APR, (iv) provides for, in the event that such Receivable is prepaid, a prepayment that fully pays the Principal Balance of such Receivable with interest at the related APR through the date of payment, (v) is a
retail installment sale contract substantially in the form of Exhibit B, (vi) is secured by a new or used motor vehicle that had not been repossessed as of the Cutoff Date, (vii) is a Simple Interest Receivable, (viii) relates to an
Obligor who has made at least one payment under such Receivable as of the Cutoff Date and (ix) relates to an Obligor whose mailing address is located in any State. 

(ii) Receivable Schedule. The information set forth in the Receivable Schedule was true and correct in all material
respects as of the opening of business on the Cutoff Date, and no selection procedures believed to be adverse to the Depositor and/or the Noteholders were utilized in selecting the Receivables from those retail installment sale contracts which met
the criteria contained in this Agreement. The information set forth in the compact disk or other listing regarding the Receivables made available to the Depositor and its assigns (which compact disk or other listing is required to be delivered as
specified herein) is true and correct in all material respects. 
 (iii) Compliance with Law. Each
Receivable and the sale of the related Financed Vehicle complied, at the time such Receivable was originated and complies, as of the Closing Date, in all material respects with all requirements of applicable federal, State and local laws, and
regulations thereunder, including usury laws, the Federal Truth-in-Lending Act, the Equal Credit Opportunity Act, the Fair Credit Reporting Act, the Fair Debt Collection Practices Act, the Federal Trade Commission Act, the Magnuson-Moss Warranty
Act, the Federal Reserve Board’s Regulations B and Z, the Servicemembers Civil Relief Act, State adaptations of the National Consumer Act and the Uniform Consumer Credit Code and any other consumer credit, equal opportunity and disclosure laws
applicable to such Receivable and sale. 

  
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 (iv)
Binding Obligation. Each Receivable represents the genuine, legal, valid and binding payment obligation in writing of the related Obligor, enforceable by the holder thereof in all material respects in accordance with its terms, except as
enforceability may be limited by bankruptcy, insolvency, reorganization, liquidation or other similar laws affecting the enforcement of creditors’ rights generally and by general principles of equity. 

(v) No Government Obligor. No Receivable is due from the United States or any State or from any agency, department
or instrumentality of the United States or any State. 
 (vi) Security Interest in Financed Vehicles.
Immediately prior to the transfer of the Receivables by the Seller to the Depositor, each Receivable was secured by a valid, binding and enforceable first priority perfected security interest in favor of the Seller in the related Financed Vehicle,
which security interest has been validly assigned by the Seller to the Depositor. The Servicer has received, or will receive within 180 days after the Closing Date, the original certificate of title for each Financed Vehicle (other than any
Financed Vehicle that is subject to a certificate of title statute or motor vehicle registration law that does not require that the original certificate of title for such Financed Vehicle be delivered to the Seller). 

(vii) Receivables in Force. No Receivable has been satisfied, subordinated or rescinded, nor has any Financed
Vehicle been released in whole or in part from the Lien granted by the related Receivable. 
 (viii) No
Waiver. No provision of any Receivable has been waived in such a manner that such Receivable fails to meet all of the representations and warranties made by the Seller in this Section 3.2(b) with respect thereto. 

(ix) No Defenses. No Receivable is subject to any right of rescission, setoff, counterclaim or defense, including
the defense of usury, and the operation of any of the terms of any Receivable, or the exercise of any right thereunder, will not render such Receivable unenforceable in whole or in part or subject to any right of rescission, setoff, counterclaim or
defense, including the defense of usury, and the Seller has no knowledge of any such right of rescission, setoff, counterclaim or defense being asserted or threatened with respect to any Receivable. 

(x) No Liens. The Seller has no knowledge of any liens or claims that have been filed, including liens for work,
labor or materials or for unpaid State or federal taxes, relating to any Financed Vehicle that are prior to, or equal or coordinate with, the security interest in such Financed Vehicle created by the related Receivable. 

(xi) No Default. Except for payment defaults continuing for a period of not more than 30 days as of the Cutoff
Date, the Seller has no knowledge that any default, breach, violation or event permitting acceleration under the terms of any Receivable has occurred or that any continuing condition that with notice or the lapse of time or both would constitute a
default, breach, violation or event permitting acceleration under the terms of any Receivable has arisen, and the Seller has not waived any such event or condition. 

  
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 (xii)
Title. The Seller intends that the transfer of the Receivables contemplated by Section 2.1 constitute a sale of the Receivables from the Seller to the Depositor and that the beneficial interest in, and title to, the Receivables not be
part of the Seller’s estate in the event of the filing of a bankruptcy petition by or against the Seller under any bankruptcy law. The Seller has not sold, transferred, assigned or pledged any Receivable to any Person other than the Depositor.
Immediately prior to the transfer of the Receivables contemplated by Section 2.1, the Seller had good and marketable title to the Receivables free and clear of any Lien, claim or encumbrance of any Person and, immediately upon such transfer,
the Depositor shall have good and marketable title to the Receivables free and clear of any Lien, claim or encumbrance of any Person. 
 (xiii) Security Interest Matters. This Agreement creates a valid and continuing “security interest” (as defined in the Relevant UCC) in the Receivables in favor of the Depositor, which
security interest is prior to all other Liens and is enforceable as such against creditors of and purchasers from the Seller. With respect to each Receivable, the Seller has taken all steps necessary to perfect its security interest against the
related Obligor in the related Financed Vehicle. The Receivables constitute “tangible chattel paper” (as defined in the Relevant UCC). The Seller has caused or will cause prior to the Closing Date the filing of all appropriate financing
statements in the proper filing offices in the appropriate jurisdictions under applicable law necessary to perfect the security interest in the Receivables granted to the Depositor under this Agreement. Other than the security interest granted to
the Depositor under this Agreement, the Seller has not pledged, assigned, sold, granted a security interest in or otherwise conveyed any of the Receivables. The Seller has not authorized the filing of and is not aware of any financing statements
against the Seller that include a description of collateral covering the Receivables other than any financing statement relating to the security interest granted to the Depositor under this Agreement or that has been terminated. The motor vehicle
retail installment sale contracts that constitute or evidence the Receivables do not have any marks or notations indicating that they have been pledged, assigned or otherwise conveyed to any Person other than the Depositor, the Issuer or the
Indenture Trustee. The Seller is not aware of any judgment or tax lien filings against the Seller. 
 (xiv)
Financing Statements. All financing statements filed or to be filed against the Seller in favor of the Indenture Trustee (as assignee of the Depositor and the Issuer) contain a statement substantially to the following effect: “A purchase
of or security interest in any collateral described in this financing statement will violate the rights of the Indenture Trustee.” 
 (xv) Valid Assignment. No Receivable has been originated in, or is subject to the laws of, any jurisdiction under which the sale, transfer, assignment and conveyance of such Receivable under this
Agreement or the Sale and Servicing Agreement or the pledge of such Receivable under the Indenture is unlawful, void or voidable or under which such Receivable would be rendered void or voidable as a result of any such sale, transfer, assignment,
conveyance or pledge. The Seller has not entered into any agreement with any account debtor that prohibits, restricts or conditions the assignment of the Receivables. 

  
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 (xvi)
One Original. There is only one original executed copy of each Receivable. 
 (xvii) Principal
Balance. Each Receivable had an original Principal Balance of not more than $65,000 and a remaining Principal Balance as of the Cutoff Date of not less than $500. 

(xviii) No Bankrupt Obligors. As of the Cutoff Date, no Receivable was due from an Obligor that was the subject of
a proceeding under the Bankruptcy Code of the United States or was bankrupt. 
 (xix) New and Used
Vehicles. As of the Cutoff Date, approximately 1.02% of the Pool Balance related to Receivables secured by new Financed Vehicles and approximately 98.98% of the Pool Balance related to Receivables secured by used Financed Vehicles. 

(xx) Origination. Each Receivable was originated after November 3, 2004. 

(xxi) Term to Maturity. Each Receivable had an original term to maturity of not more than 72 months and not less
than 12 months and a remaining term to maturity as of the Cutoff Date of not more than 71 months and not less than three months. 
 (xxii) Weighted Average Remaining Term to Maturity. As of the Cutoff Date, the weighted average remaining term to maturity of the Receivables was approximately 57.39 months. 

(xxiii) Annual Percentage Rate. Each Receivable has an APR of at least 3.95% and not more than 25.00%. 

(xxiv) Location of Receivable Files. The Receivable Files are maintained at the location listed in Schedule 2 to
the Sale and Servicing Agreement. 
 (xxv) Simple Interest Method. All payments with respect to the
Receivables have been allocated consistently in accordance with the Simple Interest Method. 
 (xxvi) No
Delinquent Receivables. As of the Cutoff Date, no payment due under any Receivable was more than 30 days past due. 
 (xxvii) Insurance. Each Obligor has obtained or agreed to obtain physical damage insurance (which insurance shall not be force placed insurance) covering the related Financed Vehicle in accordance
with the Seller’s normal requirements. 
 (xxviii) Fair Market Value. The Receivables Purchase Price
represents the fair market value of the Receivables. 

  
 11 

 (xxix) Custodial Agreements. Immediately prior to the transfer of the
Receivables by the Seller to the Depositor, the Seller or an Affiliate of the Seller had possession of the Receivable Files and there were no, and there will not be any, custodial agreements in effect materially adversely affecting the right or
ability of the Seller to make, or cause to be made, any delivery required under this Agreement. 
 (xxx) Bulk
Transfer Laws. The transfer of the Receivables and the Receivable Files by the Seller to the Depositor pursuant to this Agreement is not subject to the bulk transfer laws or any similar statutory provisions in effect in any applicable
jurisdiction. 
 (c) The Seller shall indemnify the Purchaser and hold the Purchaser harmless against any losses, penalties,
fines, forfeitures, legal fees and related costs, judgments and other costs and expenses resulting from any third party claim, demand, defense or assertion based on or grounded upon, or resulting from, a breach of the Seller’s representations
and warranties set forth in Section 3.2(b). The Trustees shall also have the remedies provided in the Sale and Servicing Agreement. 
 (d) Any cause of action against the Seller relating to or arising out of the breach of any of its representations and warranties set forth in Section 3.2(b) shall accrue as to any Receivable
upon (i) discovery of such breach by the Purchaser or either Trustee or notice thereof by the Seller to the Purchaser, (ii) failure by the Seller to cure such breach and (iii) demand upon the Seller by the Purchaser for all amounts
payable in respect of such Receivable under this Agreement. 
 (e) The Purchaser or the Seller, as the case may be, shall inform
the other parties promptly, in writing, upon discovery of any breach of the Seller’s representations and warranties set forth in Section 3.2(b) which materially and adversely affects the interests of the Noteholders in any Receivable.

 (f) If a breach of any representation or warranty set forth in Section 3.2(b) which materially and adversely affects the
interests of the Purchaser, the Issuer or the Noteholders in any Receivable shall not have been cured by the close of business on the last day of the Collection Period which includes the thirtieth day after the date on which the Seller becomes aware
of, or receives written notice from the Servicer, the Purchaser or the Owner Trustee of, such breach or failure, the Seller shall repurchase such Receivable from the Purchaser on the Distribution Date following such Collection Period. In
consideration for the repurchase of any such Receivable, the Seller shall remit the Purchase Amount of such Receivable to the Purchaser. Upon any such repurchase, the Purchaser shall, without further action, be deemed to transfer, assign, set-over
and otherwise convey to the Seller, without recourse, representation or warranty, all the right, title and interest of the Purchaser in, to and under such repurchased Receivable and all other related assets described in Section 2.1. The
Purchaser shall execute such documents and instruments of transfer or assignment and take such other actions as shall reasonably be requested by the Seller to effect the conveyance of such Receivable pursuant to this Section. The sole remedy of the
Purchaser with respect to a breach of the Seller’s representations and warranties set forth in Section 3.2(b) shall be to require the Seller to repurchase the related Receivables pursuant to this Section. 

  
 12 

  
 ARTICLE IV 

CONDITIONS 

SECTION 4.1 Conditions to Obligation of the Purchaser. The obligation of the Purchaser to purchase the Receivables from the Seller
on the Closing Date is subject to the satisfaction of the following conditions: 
 (a) Representations and
Warranties True. The representations and warranties of the Seller contained herein and in the other Transaction Documents shall be true and correct on the Closing Date with the same effect as if made on the Closing Date, and each of the Seller
and the Servicer shall have performed all obligations to be performed by it hereunder and under the other Transaction Documents on or before the Closing Date. 
 (b) Computer Files Marked. The Seller shall, at its own expense, on or before the Closing Date, indicate in its computer files that the Receivables have been sold to the Purchaser pursuant to this
Agreement and deliver to the Purchaser the Receivables Schedule, certified by an officer of the Seller to be true, correct and complete. 
 (c) Release of Lenders. The Seller shall obtain executed release agreements and UCC partial releases with respect to the Receivables from Bank of America, N.A. (and certain other parties) and
CarMax Funding II, in each case in form and substance satisfactory to the Purchaser. 
 (d) Documents to be
Delivered. The Purchaser shall have received the following, all of which shall be dated as of the Closing Date or such other date as specified: 
 (i) the Receivables Schedule; 
 (ii) an Officer’s Certificate
of the Seller, in form and substance previously approved by the Purchaser and its counsel, as to, among other things, the representations and warranties of the Seller and satisfaction of conditions precedent; 

(iii) an opinion or opinions of counsel for the Seller, in form and substance previously approved by the Purchaser and its
counsel, addressed to the Purchaser; 
 (iv) [RESERVED]; 

(v) copies of resolutions of the manager of the Seller approving the execution, delivery and performance of the
Transaction Documents to which the Seller is a party, and the performance of the transactions contemplated hereunder and thereunder, certified by the Secretary or an Assistant Secretary of the Seller; 

  
 13 

  
 (vi)
copies of the certificate of formation of the Seller, together with all amendments, revisions and supplements thereto, certified by the Delaware Secretary of State as of a recent date, and a certificate of good standing from the Delaware Secretary
of State, dated as of a recent date, to the effect that the Seller has been duly formed, is in good standing and has a legal existence; 
 (vii) UCC search reports from the appropriate offices in Delaware as to the Seller; 
 (viii) reliance letters to each opinion of counsel to the Seller or the Servicer delivered to Standard & Poor’s or Moody’s in connection with the purchase of the Receivables hereunder
or the issuance or sale of the Notes; 
 (ix) a financing statement to be filed with the Delaware Secretary of
State, naming the Seller, as seller/debtor, the Purchaser, as purchaser/assignor secured party, and the Indenture Trustee, as secured party/total assignee, naming the Receivables and the related property described in Section 2.1 as collateral
and meeting the requirements of the laws of each such jurisdiction and in such manner as is necessary to perfect the sale, transfer, assignment and conveyance of the Receivables to the Purchaser; 

(x) the Bill of Sale; and 
 (xi) such other documents, certificates and opinions as may be reasonably requested by the Purchaser or its counsel. 

(e) Execution of Transaction Documents. The Transaction Documents shall have been executed and delivered by the
parties thereto. 
 (f) Other Transactions. The transactions contemplated by the Transaction Documents and
the Underwriting Agreement shall be consummated on the Closing Date. 
 SECTION 4.2 Conditions to Obligation of the
Seller. The obligation of the Seller to sell the Receivables to the Purchaser on the Closing Date is subject to the satisfaction of the following conditions: 

(a) Representations and Warranties True. The representations and warranties of the Purchaser contained herein and
in the other Transaction Documents shall be true and correct on the Closing Date with the same effect as if then made, and the Purchaser shall have performed all obligations to be performed by it hereunder and under the other Transaction Documents
on or before the Closing Date. 
 (b) Payment of Receivables Purchase Price. In consideration of the sale
of the Receivables from the Seller to the Purchaser as provided in Section 2.1, on the Closing Date the Purchaser shall have paid to the Seller the Receivables Purchase Price. 

(c) Opinions of Purchaser. An opinion or opinions of counsel for the Purchaser addressed to the Seller and the
Underwriters shall have been delivered. 

  
 14 

  
 ARTICLE V 

COVENANTS OF THE SELLER 
 SECTION 5.1 Protection of Right, Title and Interest in, to and Under the Receivables. 
 (a) The Seller, at its expense, shall cause all financing statements and continuation statements and any other necessary documents covering the Purchaser’s right, title and interest in, to and under
the Receivables and other property conveyed by the Seller to the Purchaser hereunder to be promptly authorized, recorded, registered and filed, and at all times to be kept recorded, registered and filed, all in such manner and in such places as may
be required by law fully to preserve and protect the right, title and interest of the Purchaser hereunder to the Receivables and such other property. The Seller shall deliver to the Purchaser file-stamped copies of, or filing receipts for, any
document recorded, registered or filed as provided above, as soon as available following such recording, registration or filing. The Purchaser shall cooperate fully with the Seller in connection with the obligations set forth above and will execute
any and all documents reasonably required to fulfill the intent of this subsection. 
 (b) Within five days after the Seller
makes any change in its name, identity or organizational structure which would make any financing statement or continuation statement filed in accordance with Section 4.1(d) seriously misleading within the meaning of the UCC as in effect in the
applicable State, the Seller shall give the Purchaser notice of any such change and, within 30 days after such change, shall authorize and file such financing statements or amendments as may be necessary to continue the perfection of the
Purchaser’s security interest in the Receivables and the proceeds thereof. 
 (c) The Seller shall give the Purchaser
written notice within five days of any relocation of the State of organization of the Seller or any office in which the Seller keeps records concerning the Receivables and whether, as a result of such relocation, the applicable provisions of the UCC
would require the filing of any amendment of any previously filed financing or continuation statement or of any new financing statement and, within 30 days after such relocation, shall authorize and file such financing statements or amendments as
may be necessary to continue the perfection of the interest of the Purchaser in the Receivables and the proceeds thereof. The Seller shall at all times maintain its State of organization, its principal place of business and its chief executive
office and the location of the office where the Receivables Files and any accounts and records relating to the Receivables are kept within the United States. 
 (d) The Seller shall maintain accounts and records as to each Receivable accurately and in sufficient detail to permit (i) the reader thereof to know at any time the status of such Receivable,
including payments and recoveries made and payments owing (and the nature of each) and (ii) reconciliation between payments or recoveries on (or with respect to) each Receivable. 

(e) The Seller shall maintain its computer systems so that, from and after the time of the transfer of the Receivables to the Purchaser
pursuant to this Agreement, the Seller’s master computer records (including any back-up archives) that refer to a Receivable shall 

  
 15 

 
indicate clearly and unambiguously that such Receivable is owned by the Purchaser (or, upon transfer of the Receivables to the Issuer, by the Issuer). Indication of the Purchaser’s ownership
of a Receivable shall be deleted from or modified on the Seller’s computer systems when, and only when, such Receivable shall have been paid in full or repurchased by the Seller. 

(f) If at any time the Seller shall propose to sell, grant a security interest in or otherwise transfer any interest in any motor vehicle
retail installment sale contract to any prospective purchaser, lender or other transferee, the Seller shall give to such prospective purchaser, lender or other transferee computer tapes, compact disks, records or print-outs (including any restored
from back-up archives) that, if they shall refer in any manner whatsoever to any Receivable, shall indicate clearly and unambiguously that such Receivable has been sold and is owned by the Purchaser (or, upon transfer of the Receivables to the
Issuer, the Issuer), unless such Receivable has been paid in full or repurchased by the Seller. 
 (g) The Seller shall permit
the Purchaser and its agents at any time during normal business hours to inspect, audit and make copies of and abstracts from the Seller’s records regarding any Receivable. 

(h) If the Seller has repurchased one or more Receivables from the Purchaser or the Issuer pursuant to Section 3.2(f), the Seller
shall, upon request, furnish to the Purchaser, within ten days, a list of all Receivables (by receivable number and name of Obligor) then owned by the Purchaser, together with a reconciliation of such list to the Receivables Schedule. 

SECTION 5.2 Security Interests. Except for the conveyances hereunder, the Seller covenants that it will not sell, pledge, assign
or transfer to any other Person, or grant, create, incur, assume or suffer to exist any Lien on any Receivable, whether now existing or hereafter created, or any interest therein; the Seller will immediately notify the Purchaser of the existence of
any Lien on any Receivable and, in the event that the interests of the Noteholders in such Receivable are materially and adversely affected, such Receivable shall be repurchased from the Purchaser by the Seller in the manner and with the effect
specified in Section 3.2(f), and the Seller shall defend the right, title and interest of the Purchaser in, to and under the Receivables, whether now existing or hereafter created, against all claims of third parties claiming through or under
the Seller. 
 SECTION 5.3 Delivery of Payments. The Seller covenants and agrees to deliver in kind upon receipt to the
Servicer under the Sale and Servicing Agreement all payments received by the Seller in respect of the Receivables as soon as practicable after receipt thereof by the Seller. 
 SECTION 5.4 No Impairment. The Seller covenants that it shall take no action, nor omit to take any action, which would impair the rights of the Purchaser in any Receivable, nor shall it, except as
otherwise provided in this Agreement or the Sale and Servicing Agreement, reschedule, revise or defer payments due on any Receivable. 
 SECTION 5.5 Costs and Expenses. The Seller shall pay all reasonable costs and expenses incurred in connection with the perfection of the Purchaser’s right, title and interest in, to and under
the Receivables. 

  
 16 

  
 SECTION 5.6 Hold
Harmless. The Seller shall protect, defend, indemnify and hold the Purchaser and the Issuer and their respective assigns and their attorneys, accountants, employees, officers and directors harmless from and against all losses, costs,
liabilities, claims, damages and expenses of every kind and character, as incurred, resulting from or relating to or arising out of (i) the inaccuracy, nonfulfillment or breach of any representation, warranty, covenant or agreement made by the
Seller in this Agreement, (ii) any legal action, including any counterclaim, that has either been settled by the litigants (which settlement, if the Seller is not a party thereto shall be with the consent of the Seller) or has proceeded to
judgment by a court of competent jurisdiction, in either case to the extent it is based upon alleged facts that, if true, would constitute a breach of any representation, warranty, covenant or agreement made by the Seller in this Agreement,
(iii) any actions or omissions of the Seller or any employee or agent of the Seller occurring prior to the Closing Date with respect to any Receivable or Financed Vehicle or (iv) any failure of a Receivable to be originated in compliance
with all requirements of law. These indemnity obligations shall be in addition to any obligation that the Seller may otherwise have. 
 ARTICLE VI 
 MISCELLANEOUS PROVISIONS 

SECTION 6.1 Amendment. 
 (a) This Agreement may be amended from time to time by a written amendment duly executed and delivered by the Purchaser and the Seller, without the consent of any Noteholder, to cure any ambiguity, to
correct or supplement any provision herein which may be inconsistent with any other provision herein or to add any other provision with respect to matters or questions arising under this Agreement which shall not be inconsistent with the provisions
of this Agreement or the Sale and Servicing Agreement; provided, however, that any such amendment shall not, as evidenced by an Opinion of Counsel to the Seller delivered to the Indenture Trustee, adversely affect in any material
respect the interests of the Noteholders. 
 (b) This Agreement may also be amended from time to time for any other purpose by a
written amendment duly executed and delivered by the Seller and by the Purchaser; provided, however, that any such amendment that materially adversely affects the interests of the Noteholders under the Indenture, the Sale and Servicing
Agreement or the Trust Agreement must be consented to by the Holders of Notes evidencing not less than 51% of the Note Balance of the Controlling Class. 
 (c) Promptly after the execution of any amendment to this Agreement, the Seller shall furnish written notification of the substance of such amendment to the Owner Trustee, the Indenture Trustee and the
Rating Agencies. 
 SECTION 6.2 Termination. The respective obligations and responsibilities of the Seller and the
Purchaser created hereby shall terminate, except for the indemnity obligations of the Seller as provided herein, upon the termination of the Issuer as provided in the Trust Agreement. 

  
 17 

 SECTION 6.3 Governing Law. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS (OTHER THAN SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE
WITH SUCH LAWS. 
 SECTION 6.4 Notices. All demands, notices and communications hereunder shall be in writing and shall
be deemed to have been duly given if personally delivered at or sent by telecopier, overnight courier or mailed by registered mail, return receipt requested, in the case of (i) the Purchaser, to CarMax Auto Funding LLC, 12800 Tuckahoe Creek
Parkway, Suite 400, Richmond, Virginia 23238, Attention: Treasurer, and (ii) the Seller, to CarMax Business Services, LLC, 12800 Tuckahoe Creek Parkway, Richmond, Virginia 23238, Attention: Treasury Department; or, as to either of such Persons,
at such other address as shall be designated by such Person in a written notice to the other Person. 
 SECTION 6.5
Severability of Provisions. If any one or more of the covenants, agreements, provisions or terms of this Agreement shall for any reason whatsoever be held invalid, then such covenants, agreements, provisions or terms shall be deemed severable
from the remaining covenants, agreements, provisions and terms of this Agreement and shall in no way affect the validity or enforceability of the other covenants, agreements, provisions and terms of this Agreement or any amendment or supplement
hereto. 
 SECTION 6.6 Further Assurances. The Seller and the Purchaser agree to do and perform, from time to time, any
and all acts and to execute any and all further instruments required or reasonably requested by the other party hereto or by the Issuer or the Indenture Trustee more fully to effect the purposes of this Agreement, including the execution of any
financing statements, amendments, continuation statements or releases relating to the Receivables for filing under the provisions of the UCC or other law of any applicable jurisdiction. 

SECTION 6.7 No Waiver; Cumulative Remedies. No failure to exercise and no delay in exercising, on the part of the Purchaser, the
Issuer or the Seller, any right, remedy, power or privilege hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or
the exercise of any other right, remedy, power or privilege. The rights, remedies, powers and privileges herein provided are cumulative and not exhaustive of any rights, remedies, powers and privileges provided by law. 

SECTION 6.8 Counterparts. This Agreement may be executed in two or more counterparts (and by different parties on separate
counterparts), each of which shall be an original, but all of which together shall constitute one and the same instrument. 

SECTION 6.9 Third-Party Beneficiaries. This Agreement will inure to the benefit of and be binding upon the parties hereto, the
Issuer and the Indenture Trustee for the benefit of the Noteholders, who shall be considered to be third-party beneficiaries hereof. Except as otherwise provided in this Agreement, no other Person will have any right or obligation hereunder.

  
 18 

 SECTION 6.10 Headings and Table of Contents. The Table of Contents and headings
herein are for purposes of reference only and shall not otherwise affect the meaning or interpretation of any provision hereof. 

SECTION 6.11 Representations, Warranties and Agreements to Survive. The respective agreements, representations, warranties and
other statements by the Seller and by the Purchaser set forth in or made pursuant to this Agreement shall remain in full force and effect and will survive the closing hereunder of the transfers and assignments by the Seller to the Purchaser and by
the Purchaser to the Issuer and shall inure to the benefit of the Purchaser, the Trustees and the Noteholders. 
 SECTION 6.12
No Proceedings. The Seller covenants and agrees that so long as this Agreement is in effect, and for one year plus one day following its termination, it will not file any involuntary petition or otherwise institute, or cooperate with or
encourage others to institute, any bankruptcy, reorganization arrangement, insolvency or liquidation proceeding or other proceedings under any federal or State bankruptcy law or similar law against the Issuer or the Owner Trustee. 

SECTION 6.13 Accountant’s Letters. 
 (a) The Seller shall cause a firm of independent certified public accountants (who may also render other services to the Seller) to perform certain procedures regarding the characteristics of the
Receivables described in the Receivables Schedule and to compare those characteristics to the information with respect to the Receivables contained in the Prospectus. The Seller shall cooperate with the Purchaser and such accountants in making
available all information and taking all steps reasonably necessary to permit such accountants to complete such procedures and to deliver the letters required of them under the Underwriting Agreement. 

(b) The Seller shall cause a firm of independent certified public accountants (who may also render other services to the Seller) to
deliver to the Purchaser a letter dated November 10, 2010 in the form previously agreed to by the Seller and the Purchaser, with respect to the financial and statistical information contained in the Prospectus under the caption
“CarMax—Delinquency, Credit Loss and Recovery Information” and with respect to such other information as may be agreed in the forms of such letters. 
 SECTION 6.14 Obligations of Purchaser. The obligations of the Purchaser under this Agreement shall not be affected by reason of any invalidity, illegality or irregularity of any Receivable.

 [SIGNATURE PAGE FOLLOWS] 

  
 19 

  
 IN WITNESS WHEREOF,
the parties hereto have caused this Agreement to be duly executed by their respective officers as of the day and year first above written. 
  

			
	 CARMAX BUSINESS SERVICES, LLC,

    as Seller

		
	 By:
	 	 /s/ Keith D. Browning

	 Name:
	 	Keith D. Browning
	 Title:
	 	Executive Vice President
	
	 CARMAX AUTO FUNDING LLC,
     as Purchaser

		
	 By:
	 	 /s/ Thomas W. Reedy

	 Name:
	 	Thomas W. Reedy
	 Title:
	 	Treasurer

  
 S-1

  
 EXHIBIT A

 BILL OF SALE AND ASSIGNMENT 
 For value received, in accordance with the receivables purchase agreement, dated as of November 1, 2010 (the “Receivables Purchase Agreement”), between the undersigned and CarMax
Auto Funding LLC (the “Purchaser”), the undersigned does hereby sell, assign, transfer, set over and otherwise convey unto the Purchaser, without recourse, all right, title and interest of the undersigned, whether now owned or
hereafter acquired, in, to and under (i) the Receivables listed on Schedule A hereto (the “Receivables”); (ii) all amounts received on or in respect of the Receivables (including proceeds of the repurchase of
Receivables by the Seller pursuant to the Receivables Purchase Agreement) after the Cutoff Date; (iii) the security interests in the Financed Vehicles granted by the Obligors pursuant to the Receivables and any other interest of the undersigned
in such Financed Vehicles; (iv) all proceeds from claims on or refunds of premiums of any physical damage or theft insurance policies covering the Financed Vehicles and any proceeds or refunds of premiums of any credit life or credit disability
insurance policies relating to the Financed Vehicles or the Obligors; (v) the Receivable Files; (vi) the right to realize upon any property (including the right to receive future Liquidation Proceeds) that shall have secured a Receivable
and have been repossessed by or on behalf of the Issuer; and (vii) all present and future claims, demands, causes of action and choses in action in respect of any or all of the foregoing and all payments on or under and all proceeds of every
kind and nature whatsoever in respect of any or all of the foregoing, including all proceeds of the conversion thereof, voluntary or involuntary, into cash or other liquid property, all accounts, general intangibles, chattel paper, instruments,
documents, money, investment property, deposit accounts, letters of credit, letter-of-credit rights, insurance proceeds, condemnation awards, rights to payment of any and every kind and other forms of obligations, and all other property which at any
time constitutes all or part of or is included in the proceeds of any of the foregoing. 
 This Bill of Sale and Assignment is
made pursuant to and upon the representations, warranties and agreements on the part of the undersigned contained in the Receivables Purchase Agreement and is to be governed by the Receivables Purchase Agreement. 

Capitalized terms used and not otherwise defined herein shall have the meaning assigned to them in the Receivables Purchase Agreement.

 IN WITNESS WHEREOF, the undersigned has caused this Bill of Sale and Assignment to be duly executed as of November 10,
2010. 
  

			
	CARMAX BUSINESS SERVICES, LLC
		
	By:	 	  

	Name:	 	
	Title:	 	

  
 A-1Form of Note for 3.125% Senior Notes

  
 Exhibit 4.1

 THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A
DEPOSITARY (AS DEFINED IN THE INDENTURE) OR A NOMINEE THEREOF. THIS SECURITY MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A SECURITY REGISTERED, AND NO TRANSFER OF THIS SECURITY IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER
THAN SUCH DEPOSITARY OR A NOMINEE THEREOF, EXCEPT IN THE CIRCUMSTANCES DESCRIBED IN THE INDENTURE. EVERY SECURITY AUTHENTICATED AND DELIVERED UPON REGISTRATION OF TRANSFER OF, OR IN EXCHANGE FOR, OR IN LIEU OF, THIS SECURITY WILL BE A GLOBAL
SECURITY SUBJECT TO THE FOREGOING, EXCEPT IN SUCH LIMITED CIRCUMSTANCES. 

  
 UNITED PARCEL SERVICE,
INC. 
  

			
	No. A-[—]	 	$[—]

 CUSIP: 911312AM8 
 ISIN: US911312AM88 

3.125% Notes due January 15, 2021 
 United Parcel Service, Inc., a corporation duly organized and existing under the laws of Delaware (herein called the “Company”, which term includes any successor Person under the Indenture
hereinafter referred to), for value received, hereby promises to pay to Cede & Co., or registered assigns, the principal sum of [—] ($[—]),
or such other principal amount as may be set forth in the records of the Securities Registrar hereinafter referred to in accordance with the Indenture, on January 15, 2021 and to pay interest thereon from November 12, 2010 or from the most
recent date to which interest has been paid or duly provided for, semi-annually on January 15 and July 15 of each year (each, an “Interest Payment Date”), commencing July 15, 2011, at the rate of 3.125% per annum, until
the principal hereof is paid or made available for payment. The interest so payable and punctually paid or duly provided for on any Interest Payment Date will, as provided in such Indenture, be paid to the Person in whose name this Security (or one
or more Predecessor Securities) is registered at the close of business on the Regular Record Date for such interest, which shall be the January 1 or July 1 (whether or not a Business Day), as the case may be, next preceding such Interest
Payment Date. Any such interest not so punctually paid or duly provided for shall forthwith cease to be payable to the Holder on such Regular Record Date and may either be paid to the Person in whose name this Security (or one or more Predecessor
Securities) is registered at the close of business on a Special Record Date for the payment of such Defaulted Interest to be set by the Trustee, notice whereof shall be given to Holders of Securities of this series not less than 10 days prior to
such Special Record Date, or be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Securities of this series may be listed, and upon such notice as may be required by such
exchange, all as more fully provided in said Indenture. 
 Delivery of the Maturity Consideration and payment of interest on
this Security will be made at the office or agency of the Company maintained for that purpose in the Borough of Manhattan, The City of New York, and payment of interest on this Security and the Maturity Consideration will be made in such coin or
currency of the United States of America as at the time of payment is legal tender for payment of public and private debts; provided, however, that at the option of the Company, payment of interest may be made by check mailed to the address of the
Person entitled thereto as such address shall appear in the Security Register. 
 Reference is hereby made to the further
provisions of this Security set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place. 

  
 Unless the certificate
of authentication hereon has been executed by the Trustee referred to on the reverse hereof by manual signature, this Security shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose. 

  
 IN WITNESS WHEREOF,
the Company has caused this instrument to be duly executed. 
 Dated:
                                 

 

			
	UNITED PARCEL SERVICE, INC.
		
	By:	 	  

 

	
	Attest:
	
	  

  
 REVERSE OF SECURITY

 This Security is one of a duly authorized issue of securities of the Company (herein called the “Securities”),
issued and to be issued in one or more series under an Indenture, dated as of August 26, 2003 (herein called the “Indenture”, which term shall have the meaning assigned to it in such instrument), between the Company and The Bank of
New York Mellon Trust Company, N.A. (as successor to Citibank, N.A.), as Trustee (herein called the “Trustee”, which term includes any successor trustee under the Indenture), and reference is hereby made to the Indenture for a statement of
the respective rights, limitations of rights, duties and immunities thereunder of the Company, the Trustee and the Holders of the Securities, and of the terms upon which the Securities are, and are to be, authenticated and delivered. This Security
is one of the series designated on the face hereof. 
 The Securities of this series are redeemable in whole or in part, at the
option of the Company at any time and from time to time, on not less than 30 nor more than 60 days’ prior notice mailed to the Holders of the Securities to be redeemed. The Securities will be redeemable at a Redemption Price equal to the
greater of (i) 100% of the principal amount of the Security to be redeemed or (ii) the sum of the present values of the remaining scheduled payments of principal and interest thereon discounted to the Redemption Date on a semi-annual basis
(assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate plus 10 basis points together in either case with accrued interest on the principal amount being redeemed to the Redemption Date. 

“Treasury Rate” means, with respect to any Redemption Date, the rate per annum equal to the semi-annual equivalent yield to
maturity (computed as of the third business day immediately preceding the Redemption Date) of the Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the
Comparable Treasury Price for such Redemption Date. 
 “Comparable Treasury Issue” means the United States Treasury
security selected by an Independent Investment Banker as having an actual or interpolated maturity comparable to the remaining term of the series of Securities to be redeemed that would be utilized, at the time of selection and in accordance with
customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to the remaining term of the series of Securities. 
 “Comparable Treasury Price” means, with respect to any Redemption Date, (1) the average of the Reference Treasury Dealer Quotations for the Redemption Date, after excluding the highest and
lowest of such Reference Treasury Dealer Quotations, or (2) if the Company obtains fewer than four such Reference Treasury Dealer Quotations, the average of all Quotations obtained. 

“Independent Investment Banker” means one of the Reference Treasury Dealers appointed by the Company. 

“Reference Treasury Dealer” means J.P. Morgan Securities LLC and Morgan Stanley & Co. Incorporated and their
respective successors and two other nationally recognized investment 

 
banking firms that are Primary Treasury Dealers specified from time to time by the Company, except that if any of the foregoing ceases to be a primary U.S. Government securities dealer in the
United States (a “Primary Treasury Dealer”), the Company is required to designate as a substitute another nationally recognized investment banking firm that is a Primary Treasury Dealer. 

“Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer and any Redemption Date, the
average, as determined by the Company, of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) quoted in writing to us (and provided to the Trustee) by such Reference Treasury
Dealer as of 3:30 p.m., New York City time, on the third business day immediately preceding the Redemption Date. 
 In the event
of redemption of this Security in part only, a new Security or Securities of this series and of like tenor for the unredeemed portion hereof will be issued in the name of the Holder hereof upon the cancellation hereof. 

The Company will not create, assume, incur or guarantee, and will not permit any Restricted Subsidiary to create, assume, incur or
guarantee, any Secured Indebtedness without making provision whereby this Security shall be secured equally and ratably with, or prior to, such Secured Indebtedness, together with, if the Company shall so determine, any other Indebtedness of the
Company or any Restricted Subsidiary then existing or thereafter created that is not subordinate to this Security, so long as the Secured Indebtedness shall be outstanding, unless such Secured Indebtedness, when added to (a) the aggregate
amount of all Secured Indebtedness then outstanding (not including in this computation Secured Indebtedness if this Security is secured equally and ratably with (or prior to) such Secured Indebtedness and further not including in this computation
any Secured Indebtedness that is concurrently being retired) and (b) the aggregate amount of all Attributable Debt then outstanding pursuant to Sale and Leaseback Transactions entered into by the Company after January 26, 1999, or entered
into by a Restricted Subsidiary after January 26, 1999 or, if later, the date on which it became a Restricted Subsidiary (not including in this computation any Attributable Debt that is concurrently being retired), would not exceed 10% of
Consolidated Net Tangible Assets. 
 The Company will not, and will not permit any Restricted Subsidiary to, enter into any Sale
and Leaseback Transaction unless (a) the sum of (i) the Attributable Debt to be outstanding pursuant to such Sale and Leaseback Transaction, (ii) all Attributable Debt then outstanding pursuant to all other Sale and Leaseback
Transactions entered into by the Company after January 26, 1999, or entered into by a Restricted Subsidiary after January 26, 1999 or, if later, the date on which it became a Restricted Subsidiary, and (iii) the aggregate of all
Secured Indebtedness then outstanding (not including in this computation Secured Indebtedness if this Security is secured equally and ratably with (or prior to) such Secured Indebtedness) would not exceed 10% of Consolidated Net Tangible Assets, or
(b) an amount equal to the greater of (i) the net proceeds to the Company or the Restricted Subsidiary of the sale of the Principal Property sold and leased back pursuant to such Sale and Leaseback Transaction and (ii) the amount of
Attributable Debt to be outstanding pursuant to such Sale and Leaseback Transaction is applied to the retirement of Funded Debt of the Company or any Restricted Subsidiaries (other than Funded Debt that is subordinate to this Security or is owing to
the Company or any Restricted Subsidiaries or is 

 
scheduled to mature within one year after consummation of such Sale and Leaseback Transaction) within 180 days after the consummation of such Sale and Leaseback Transaction. 

Default in the performance, or breach, of either of the covenants set forth in the preceding two paragraphs will be an “Event of
Default” under Section 5.01 of the Indenture, and the covenants set forth in the preceding two paragraphs will be subject to defeasance in accordance with Section 13.03 of the Indenture. 

“Attributable Debt” means, as of the date of its determination, the present value (discounted semiannually at an interest rate
of 7.0% per annum) of the obligation of a lessee for rental payments pursuant to any Sale and Leaseback Transaction (reduced by the amount of the rental obligations of any sublessee of all or part of the same property) during the remaining term
of such Sale and Leaseback Transaction (including any period for which the lease relating thereto has been extended), such rental payments not to include amounts payable by the lessee for maintenance and repairs, insurance, taxes, assessments and
similar charges and for contingent rents (such as those based on sales). In the case of any Sale and Leaseback Transaction in which the lease is terminable by the lessee upon the payment of a penalty, such rental payments shall be considered for
purposes of this definition to be the lesser of the discounted values of (a) the rental payments to be paid under such Sale and Leaseback Transaction until the first date (after the date of such determination) upon which it may be so terminated
plus the then applicable penalty upon such termination, and (b) the rental payments required to be paid during the remaining term of such Sale and Leaseback Transaction (assuming such termination provision is not exercised). 

“Capitalized Lease Obligation” means any obligation to pay rent or other amounts under a lease of (or other agreement conveying
the right to use) real or personal property that is required to be classified and accounted for as a capital lease obligation under generally accepted accounting principles, and, for the purposes of this Security, the amount of such obligation at
any date shall be the capitalized amount thereof at such date, determined in accordance with such principles. 

“Consolidated Net Tangible Assets” means at any date, the total assets appearing on the Company’s most recently prepared
consolidated balance sheet as of the end of the Company’s fiscal quarter, prepared in accordance with generally accepted accounting principles, less (a) all current liabilities as shown on such balance sheet and (b) Intangible Assets.

 “Funded Debt” means any indebtedness maturing by its terms more than one year from its date of issue, including any
indebtedness renewable or extendable at the option of the obligor to a date later than one year from the date of the original issuance thereof. 
 “Indebtedness” means (a) any liability of any Person (i) for borrowed money, or under any reimbursement obligation relating to a letter of credit, (ii) evidenced by a bond, note,
debenture or similar instrument, including a purchase money obligation, given in connection with the acquisition of any businesses, properties or assets of any kind or with services incurred in connection with capital expenditures, other than a
trade payable or a current liability arising in the ordinary course of business, or (iii) for the payment of money relating to a Capitalized Lease Obligation, or (iv) for Interest Rate Protection Obligations; (b) any liability of
others described in 

 
the preceding clause (a) that the Person has guaranteed or that is otherwise its legal liability; and (c) any amendment, supplement, modification, deferral, renewal, extension or
refunding of any liability of the types referred to in clauses (a) and (b) above. 
 “Intangible Assets”
means at any date the value (net of any applicable reserves), as shown on or reflected in the Company’s most recently prepared consolidated balance sheet, prepared in accordance with generally accepted accounting principles, of: (a) all
trade names, trademarks, licenses, patents, copyrights and goodwill; (b) organizational and development costs; (c) deferred charges (other than prepaid items such as insurance, taxes, interest, commissions, rents and similar items and
tangible assets being amortized); and (d) unamortized debt discount and expense, less unamortized premium. 

“Interest Rate Protection Obligations” of any Person means the obligations of such Person pursuant to any arrangement with any
other Person whereby, directly or indirectly, such Person is entitled to receive from time to time periodic payments calculated by applying a fixed rate of interest on a stated notional amount in exchange for periodic payments made by such Person
calculated by applying a floating rate of interest on the same notional amount. 
 “Liens” means any mortgage, lien,
pledge, security interest, charge or encumbrance. 
 “Principal Property” means any land, land improvements, buildings
and associated factory, distribution, laboratory and office equipment (excluding any motor vehicles, aircraft, mobile materials handling equipment, data processing equipment and rolling stock) constituting a distribution facility, operating
facility, manufacturing facility, development facility, warehouse facility, service facility or office facility (including any portion thereof), which facility (a) is owned by or leased to the Company or any Restricted Subsidiary, (b) is
located within the United States and (c) has an acquisition cost plus capitalized improvements in excess of 0.50% of Consolidated Net Tangible Assets as of the date of such determination, other than (i) any such facility, or portion
thereof, which has been financed by obligations issued by or on behalf of a State, a Territory or a possession of the United States, or any political subdivision of any of the foregoing, or the District of Columbia, the interest on which is
excludable from gross income of the holders thereof (other than a “substantial user” of such facility or a “related Person” as those terms are used in Section 103 of the Internal Revenue Code of 1986, as amended (the
“Code”)) pursuant to the provisions of Section 103 of the Code (or any similar provision hereafter enacted) as in effect at the time of issuance of such obligations, (ii) any such facility that the Board of Directors may by Board
Resolution declare is not of material importance to the Company and the Restricted Subsidiaries taken as a whole and (iii) any such facility, or portion thereof, owned or leased jointly or in common with one or more Persons other than the
Company and any Subsidiary and in which the interest of the Company and all Subsidiaries does not exceed 50%. 

“Restricted Securities” means any shares of the capital stock or Indebtedness of any Restricted Subsidiary. 

“Restricted Subsidiary” means (a) any Subsidiary (i) which has substantially all its property within the United
States of America, (ii) which owns or is a lessee of any Principal Property and (iii) in which the investment of the Company and all other Subsidiaries exceeds 0.50% of Consolidated Net Tangible Assets as of the date of such determination;
provided, 

 
however, that the term “Restricted Subsidiary” shall not include: (A) any Subsidiary (x) primarily engaged in the business of purchasing, holding, collecting, servicing or
otherwise dealing in and with installment sales contracts, leases, trust receipts, mortgages, commercial paper or other financing instruments, and any collateral or agreements relating thereto, including in the business, individually or through
partnerships, of financing, whether through long- or short-term borrowings, pledges, discounts or otherwise, the sales, leasing or other operations of the Company and the Subsidiaries or any of them, or (y) engaged in the business of financing
the assets and operations of third parties, and (z) in any case, not, except as incidental to such financing business, engaged in owning, leasing or operating any property which, but for this proviso, would qualify as Principal Property or
(B) any Subsidiary acquired or organized after January 26, 1999, for the purpose of acquiring the stock or business or assets of any Person other than the Company or any Restricted Subsidiary, whether by merger, consolidation, acquisition
of stock or assets or similar transaction analogous in purpose or effect, so long as such Subsidiary does not acquire by merger, consolidation, acquisition of stock or assets or similar transaction analogous in purpose or effect all or any
substantial part of the business or assets of the Company or any Restricted Subsidiary; and (b) any other Subsidiary that is hereafter designated by the Board of Directors as a Restricted Subsidiary. 

“Sale and Leaseback Transaction” means any arrangement with any Person providing for the leasing by the Company or any
Restricted Subsidiary of any Principal Property (whether such Principal Property is now owned or hereafter acquired) that has been or is to be sold or transferred by the Company or such Restricted Subsidiary to such Person, other than
(a) leases for a term, including renewals at the option of the lessee, of not more than three years; (b) leases between the Company and a Restricted Subsidiary or between Restricted Subsidiaries and (c) leases of Principal Property
executed by the time of, or within 180 days after the latest of, the acquisition, the completion of construction or improvement (including any improvements on property that will result in such property becoming a Principal Property), or the
commencement of commercial operation of such Principal Property. 
 “Secured Indebtedness” means (a) Indebtedness
of the Company or a Restricted Subsidiary that is secured by any Lien upon any Principal Property or Restricted Securities, and (b) Indebtedness of the Company or a Restricted Subsidiary in respect of any conditional sale or other title
retention agreement covering Principal Property or Restricted Securities; but “Secured Indebtedness” shall not include any of the following: 
 (a) Indebtedness of the Company and the Restricted Subsidiaries outstanding on January 26, 1999, secured by then existing Liens upon, or incurred in connection with conditional sales agreements or
other title retention agreements with respect to Principal Property or Restricted Securities; 
 (b) Indebtedness
that is secured by (i) purchase money Liens upon Principal Property acquired after January 26, 1999, (ii) Liens placed on Principal Property after January 26, 1999, during construction or improvement thereof (including any
improvements on property which will result in such property becoming Principal Property) or placed thereon within 180 days after the later of acquisition, completion of construction or improvement or the commencement of commercial operation of such
Principal Property or improvement, or placed on Restricted Securities acquired after 

 
January 26, 1999 or (iii) conditional sale agreements or other title retention agreements with respect to any Principal Property or Restricted Securities acquired after January 26,
1999, if (in each case referred to in this subparagraph (b)) (x) such Lien or agreement secures all or any part of the Indebtedness incurred for the purpose of financing all or any part of the purchase price or cost of construction of such
Principal Property or improvement or Restricted Securities and (y) such Lien or agreement does not extend to any Principal Property or Restricted Securities other than the Principal Property so acquired or the Principal Property, or portion
thereof, on which the property so constructed or such improvement is located; provided, however, that the amount by which the aggregate principal amount of Indebtedness secured by any such Lien or agreement exceeds the cost to the Company or such
Restricted Subsidiary of the related acquisition, construction or improvement will be considered to be “Secured Indebtedness;” 
 (c) Indebtedness that is secured by Liens on Principal Property or Restricted Securities, which Liens exist at the time of acquisition (by any manner whatsoever) of such Principal Property or Restricted
Securities by the Company or a Restricted Subsidiary; 
 (d) Indebtedness of Restricted Subsidiaries owing to the
Company or any other Restricted Subsidiary and Indebtedness of the Company owing to any Restricted Subsidiary; 

(e) In the case of any corporation that becomes (by any manner whatsoever) a Restricted Subsidiary after January 26,
1999, Indebtedness that is secured by Liens upon, or conditional sale agreements or other title retention agreements with respect to, its property that constitutes Principal Property or Restricted Securities, which Liens exist at the time such
corporation becomes a Restricted Subsidiary; 
 (f) Guarantees by the Company of Secured Indebtedness and
Attributable Debt of any Restricted Subsidiaries and guarantees by a Restricted Subsidiary of Secured Indebtedness and Attributable Debt of the Company and any other Restricted Subsidiaries; 

(g) Indebtedness arising from any Sale and Leaseback Transaction; 

(h) Indebtedness secured by Liens on property of the Company or a Restricted Subsidiary in favor of the United States of
America, any State, Territory or possession thereof, or the District of Columbia, or any department, agency or instrumentality or political subdivision of the United States of America or any State, Territory or possession thereof, or the District of
Columbia, or in favor of any other country or any political subdivision thereof, if such Indebtedness was incurred for the purpose of financing all or any part of the purchase price or the cost of construction of the property subject to such Lien;
provided, however, that the amount by which the aggregate principal amount of Indebtedness secured by any Lien exceeds the cost to the Company or the Restricted Subsidiary of the related acquisition or construction will be considered to be
“Secured Indebtedness”; 
 (i) Indebtedness secured by Liens on aircraft, airframes or aircraft
engines, aeronautic equipment or computers and electronic data processing equipment; and 

  
 (j) The
replacement, extension or renewal, or successive replacements, extensions or renewals, of any Indebtedness, in whole or in part, excluded from the definition of “Secured Indebtedness” by subparagraphs (a) through (i) above;
provided, however, that no Lien securing, or conditional sale or title retention agreement with respect to, such Indebtedness will extend to or cover any Principal Property or any Restricted Securities, other than such property that secured the
Indebtedness so replaced, extended or renewed, plus improvements on or to any such Principal Property, provided further, however, that to the extent that such replacement, extension or renewal increases the principal amount of Indebtedness secured
by such Lien or is in a principal amount in excess of the principal amount of Indebtedness excluded from the definition of “Secured Indebtedness” by subparagraphs (a) through (i) above, the amount of such increase or excess will
be considered to be “Secured Indebtedness.” 
 In no event shall the foregoing provisions be interpreted to mean that
the same Indebtedness is included more than once in the calculation of “Secured Indebtedness” as that term is used in this Security, nor shall their operation cause this result. 

If an Event of Default with respect to Securities of this series shall occur and be continuing, the principal of the Securities of this
series may be declared due and payable in the manner and with the effect provided in the Indenture. 
 The Indenture permits,
with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Company and the rights of the Holders of the Securities of each series issued under the Indenture at any time by the Company
and the Trustee with the consent of the Holders of a majority in aggregate principal amount of the Securities at the time Outstanding of each series to be affected. The Indenture also contains provisions permitting the Holders of specified
percentages in aggregate principal amount of the Securities of each series at the time Outstanding, on behalf of the Holders of all Securities of such series, to waive compliance by the Company with certain provisions of the Indenture and certain
past defaults under the Indenture and their consequences. Any such consent or waiver by the Holder of this Security shall be conclusive and binding upon such Holder and upon all future Holders of this Security and of any Security issued upon the
registration of transfer hereof or in exchange herefor or in lieu hereof, whether or not notation of such consent or waiver is made upon this Security. 
 As provided in and subject to the provisions of the Indenture, the Holder of this Security shall not have the right to institute any proceeding with respect to the Indenture or for the appointment of a
receiver or trustee or for any other remedy thereunder, unless such Holder shall have previously given the Trustee written notice of a continuing Event of Default with respect to the Securities of this series, the Holders of not less than 25% in
principal amount of the Securities of this series at the time Outstanding shall have made a written request to the Trustee to institute proceedings in respect of such Event of Default as Trustee and offered the Trustee indemnity satisfactory to the
trustee, and the Trustee shall not have received from the Holders of a majority in principal amount of Securities of this series at the time Outstanding a direction inconsistent with such request, and shall have failed to institute any such
proceeding for 60 days after receipt of such notice, request and offer of indemnity. The foregoing shall not apply to any suit instituted by the Holder of this Security for the enforcement of any payment or delivery of

 
the Maturity Consideration hereof or any premium or interest hereon on or after the respective due dates expressed herein. 

No reference herein to the Indenture and no provision of this Security or of the Indenture shall affect or impair the obligation of the
Company, which is absolute and unconditional, to pay the Maturity Consideration and interest on this Security at the times, place and rate, and in the manner, herein prescribed. 

As provided in the Indenture and subject to certain limitations set forth therein and in this Security, the transfer of this Security is
registrable in the Security Register upon surrender of this Security for registration of transfer at the office or agency of the Company in any place where the Maturity Consideration and interest on this Security are payable, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the Company and the Security Registrar duly executed by the Holder hereof or his attorney duly authorized in writing, and thereupon one or more new Securities of this series and
of like tenor, of authorized denominations and for the same aggregate principal amount, will be issued to the designated transferee or transferees. 
 The securities of this series are issuable only in registered form without coupons in denominations of $2,000 and any integral multiples of $1,000 in excess thereof. As provided in the Indenture and
subject to certain limitations set forth therein, Securities of this series are exchangeable for a like aggregate principal amount of Securities of this series and of like tenor in different authorized denomination, as requested by the Holder
surrendering the same. 
 No service charge shall be made for any such registration of transfer or exchange, but the Company may
require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith. 
 Prior to
due presentment of this Security for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the Person in whose name this Security is registered as the owner hereof for all purposes, whether or not
this Security be overdue, and neither the Company, the Trustee nor any such agent shall be affected by notice to the contrary. 

The Indenture contains provisions whereby (i) the Company may be discharged from its obligations with respect to the Securities
(subject to certain exceptions) or (ii) the Company may be released from its obligation under specified covenants and agreements in the Indenture, in each case if the Company irrevocably deposits with the Trustee money or U.S. Government
Obligations sufficient to pay and discharge the entire indebtedness on all Securities of this series, and satisfies certain other conditions, all as more fully provided in the Indenture. 

This Note shall be governed by and construed in accordance with the laws of the State of New York without giving effect to principles of
conflicts of laws of such state. 
 All terms used in this Security which are defined in the Indenture shall have the meanings
assigned to them in the Indenture. 

  
 This is one of the
Securities of the series designated herein referred to in the Indenture. 
  

			
	THE BANK OF NEW YORK MELLON TRUST
COMPANY,
N.A.,
	As Trustee
		
	By:	 	  

		 	    Authorized Signatory

  
 [FORM OF TRANSFER
NOTICE] 
 FOR VALUE RECEIVED the undersigned registered holder hereby sell(s), assign(s) and transfer(s) unto 

Insert Taxpayer Identification No. 
 (Please print or typewrite name and address including zip code of assignee) 
 the
within Security and all rights thereunder, hereby irrevocably constituting and appointing
                                 to transfer said Security on the books of the
Company with full power of substitution in the premises. 
  

	
	  

	By:
	Date:

  
 SCHEDULE OF INCREASES
OR DECREASES IN SECURITY 
 The following increases or decreases in this Security have been made: 

 

									
	 Date of
Exchange
	  	
Amount of decrease in
Principal Amount of this
Security
	  	 Amount of increase in

Principal Amount of this

Security
	  	 Principal Amount of this

Security following such
 decrease or increase
	  	 Signature of authorized

officer of Trustee or
 Securities Custodian

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