Employee Stock Purchase Plan - files.carmax.com

1 Employee Stock Purchase plan Prospectus dated July 30, 2009 for the CARMAX, INC. AMENDED AND RESTATED. 2002 Employee Stock Purchase plan . As Amended and Restated June 23, 2009. 8,000,000 shares of CarMax, Inc. Common Stock , $.50 par value and 8,000,000 Rights to Purchase Preferred Stock , Series A, $ par value, attached in equal number to the shares of CarMax, Inc. Common Stock See the section, Risk Factors for information you should consider in evaluating participation in the plan . This document constitutes part of a Prospectus covering securities that have been registered under the Securities Act of 1933, as amended. You should rely only on the information provided or incorporated by reference in this Prospectus or any other document we identify to you as part of this Prospectus.

2 We have not authorized anyone else to provide you with different information. You should not assume that the information in this Prospectus is accurate as of any date other than the date of this Prospectus. We are not making an offer of these securities in any state where the offer is not permitted. i TABLE OF CONTENTS. Introduction 1. Risk Factors 1. Contact Information 1. Participation in the plan 2. Purchases under the plan 4. Sale of Shares and Request for Certificates 7. Tax Consequences 8. Leaving the plan 9. Additional Information about the plan 10. Information about the Company 11. ii INTRODUCTION. This Prospectus describes the CarMax, Inc. Amended and Restated 2002 Employee Stock Purchase plan (the plan ).

3 The purpose of the plan is to benefit CarMax, Inc., a Virginia corporation (the Company ) and its shareholders by providing the incentive of CarMax, Inc. Common Stock ( Common Stock ) ownership to present and future associates. The plan also provides associates an additional benefit as the Company matches $ for each $ contributed by associates under the plan . The remainder of this Prospectus discusses, primarily in question and answer format, the operation of the plan and other related matters. RISK FACTORS. Before enrolling in the plan , you should carefully consider the amount you can afford to invest in the Company's Common Stock . You should not invest in the Company's Common Stock if such investment would be unduly burdensome in relationship to your other financial needs.

4 Stock prices fluctuate from time to time and there is no assurance that the market price of the Company's Common Stock will be equal to or exceed the price you paid for the shares of Common Stock under the plan . Further, the Company's business is subject to certain risks that should be considered and evaluated prior to purchasing Stock in the Company. These risks could materially and adversely affect the Company's business, financial condition and results of operation. A description of those risks can be found in certain of the documents incorporated by reference in this Prospectus as listed in the section entitled Information about the Company.. CONTACT INFORMATION. For account information, questions about your statement, to sell Stock , or to Purchase additional shares, contact Computershare Trust Company, Inc.

5 At the ESPP toll-free number 1 (866) 322- 7629, Monday through Friday, 8 to 7 Eastern Time. You may also access the Computershare web site at Or write to: Computershare Trust Company, Inc. Attn: Correspondence Team P. O. Box 7802. Edison, New Jersey 08818-7802. You will need to use your Personal Identification Number (PIN) to access most services. Your PIN will initially be the last five digits of your Social Security number. For enrollment and payroll contribution questions that cannot be answered by Computershare, contact the CarMax Benefits Service Center at 1 (888) 695-6947, option 7 or via email at Or write to: CarMax, Inc. Attn: Benefits Department ESPP Administrator 12800 Tuckahoe Creek Parkway Richmond, Virginia 23238.

6 1. PARTICIPATION IN THE plan . 1. What is the plan ? The plan allows you to Purchase shares of the Company's Common Stock through regular payroll deductions, subject to plan limitations. In addition to providing this convenient method of investment, for each $ that you contribute through payroll deductions for Stock purchases, the Company contributes $ The Company's and your contributions are combined to Purchase Common Stock . The Stock will be held in an account in your name ( ESPP Account ). Computershare Trust Company, Inc., a global provider of Stock plan services ( Computershare ), is the current provider of ESPP Accounts and other services for the plan . The plan makes it easy for you to become a shareholder of the Company and share in its potential future growth and profitability.

7 However, please keep in mind that there are risks associated with your participation in the plan . Participation is entirely voluntary and should be just one part of an overall, well-balanced investment plan . There can be no guarantee that Common Stock purchased through the plan will maintain or increase its value. See the section of this document titled Risk Factors for information concerning the risks associated with an investment in the Company's Common Stock . 2. Who is eligible to participate? You are eligible to participate if you are classified as a Regular Full-Time or Part-Time Associate of the Company and you have completed one year of service. You must also have attained the age of majority in your state of residence.

8 For purposes of determining eligibility, service is determined under the Company's Associate Classifications, Status & Status Changes, Rehire &. Reinstatement Policy in effect for associates at the time the eligibility determination is made. 3. Who is NOT eligible to participate? You may not participate in the plan if you: are a Temporary Associate as defined in the Company's Associate Classification, Status & Status Changes, Rehire & Reinstatement Policy;. are subject to Section 16 of the Securities Exchange Act of 1934, as amended ( 1934 Act ) with respect to securities of the Company;. are an officer of the Company other than an Assistant Vice President, Assistant Treasurer or Assistant Secretary; or are not engaged as a common law Employee on the Company's United States payroll (even if a court or administrative agency determines that you are a common law Employee and not an independent contractor).

9 If you are unsure whether you are eligible to participate, please call Computershare. If you are still unsure about your eligibility after speaking to Computershare, please call the CarMax Benefits Service Center for further assistance. Please refer to the Contact Information section of this document for further information. 2. 4. What should I consider before joining the plan ? The plan offers a convenient and low cost way to invest in the Company's Common Stock . While there is opportunity for financial gain, there are also risks involved in any Stock investment. In addition to reviewing information concerning the Company and its Common Stock , you should carefully review your financial objectives and other investments before enrolling in this plan .

10 The sections entitled Risk Factors and Information about the Company . in this Prospectus tell you where you may obtain information about the Company and its Common Stock . If you decide that you want to make an investment in the Company's Common Stock , there are several advantages of purchasing Common Stock through the plan including: a 15% Company match;. the convenience of payroll deductions; and no brokerage fees on plan purchases made through payroll deductions. All participants in the plan must comply with the Company's insider trading policy. 5. When can I start participating? You may enroll in the plan anytime after you have met the eligibility requirements. When you enroll in the plan , you authorize Computershare to open and maintain an ESPP Account for you, subject to the terms and conditions of the account.