UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
Annual Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the fiscal year ended: February 29, 2000
Commission file number: 333-79087
CARMAX AUTO OWNER TRUST 1999-1
(Issuer with respect to the Notes and Certificates)
CARMAX AUTO RECEIVABLES LLC
(Exact name of registrant as specified in its charter)
Virginia 54-1942944
----------------- --------------
(State or other (IRS Employer
jurisdiction Identification No.)
of incorporation)
4900 Cox Road, Suite 200, Glen Allen, Virginia 23060
- ------------------------------------------------ ------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 804 935-4512
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports) and (2) has been subject to such
filing requirements for the past 90 days.
Yes [X] 1 No[ ]
- --------
1 In reliance upon various no-action letters issued by the Securities
and Exchange Commission to other trusts which are substantially similar to the
registrant, the registrant has filed monthly Forms 8-K in lieu of Forms 10-Q.
Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K (229.405 of this chapter) is not contained herein,
and will not be contained, to the best of registrant's knowledge, in definitive
proxy or information statements incorporated by reference in any amendment to
this Form 10-K.[X]
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date:
Not Applicable.
PART I
CarMax Auto Receivables LLC established the Carmax Auto Owner Trust
1999-1 (the "Trust") as of October 8, 1999 pursuant to a Trust Agreement between
Carmax Auto Receivables LLC and First Union Trust Company, National Association
(the "Owner Trustee"). Pursuant to the Amended and Restated Trust Agreement
dated as of October 1, 1999 between CarMax Auto Receivables LLC and the Owner
Trustee, the Trust issued in a public transaction the 7.12% Asset-Backed
Certificates (the "Certificates") in the initial principal amount of
$12,879,759.72. Pursuant to the Indenture dated as of October 1, 1999 between
the Trust and Bankers Trust Company (the "Indenture Trustee"), the Trust issued
in a public transaction the Class A-1 Asset-Backed Notes, Class A-2 Asset-Backed
Notes, Class A-3 Asset-Backed Notes and Class A-4 Asset-Backed Notes
(collectively, the "Notes") in the aggregate initial principal amount of
$631,078,000.00.
The property of the Trust includes, among other things, a pool of
simple interest retail installment sale contracts originated by Carmax Auto
Superstores, Inc. in the ordinary course of business in connection with the sale
of new and used motor vehicles (the "Contracts"), payments due or received on or
in respect of the Contracts after September 30, 1999 (the "Cut-Off Date"),
security interests in the vehicles financed by the Contracts (the "Financed
Vehicles") and certain other property described below. The principal balance of
the Contracts was $643,957,759.72 as of the Cut-Off Date. CarMax Auto
Superstores, Inc. sold the Contracts to CarMax Auto Receivables LLC pursuant to
a Purchase Agreement dated as of October 1, 1999 (the "Purchase Agreement").
Simultaneously with the issuance of the Notes and the Certificates,
CarMax Auto Receivables LLC sold and assigned to the Owner Trustee, for the
benefit of the Trust and without recourse, all of CarMax Auto Receivables LLC's
interest in the Contracts, the proceeds thereof and certain other assets of the
Trust pursuant to a Sale and Servicing Agreement dated as of October 1, 1999
(the "Sale and Servicing Agreement") among CarMax Auto Receivables LLC, as
seller, CarMax Auto Superstores, Inc., as servicer (the "Servicer"), and the
Trust. The Servicer services the Contracts pursuant to the Sale and Servicing
Agreement and is compensated for acting as the Servicer. In order to facilitate
the Servicer's servicing functions and minimize administrative burden and
expenses, (i) the certificates of title for the Financed Vehicles will not be
marked to reflect the Trust's security interest in the Financed Vehicles and
(ii) the Servicer will act as custodian of the Contracts and the Contracts will
not be segregated or otherwise marked to reflect their transfer to the Trust.
The property of the Trust also includes (i) various documents relating
to the Contracts, (ii) various monies due under the Contracts on and after the
Cut-Off Date, (iii) the right to receive proceeds from claims on various
insurance policies covering the Financed Vehicles or the obligors under each
related Contract, (iv) all amounts on deposit in the collection account, the
note payment account, the certificate payment account and the reserve account,
including all eligible investments credited thereto, (v) the benefits of an
unconditional and irrevocable insurance policy issued by MBIA Insurance
Corporation, (vi) rights under the Purchase Agreement to cause CarMax Auto
Superstores, Inc. to repurchase Contracts affected materially and adversely by
breaches of the representations and warranties of CarMax Auto Superstores, Inc.
made in the Purchase Agreement, (vii) rights under the Sale and Servicing
Agreement to cause the Servicer to purchase Contracts affected materially and
adversely by breaches of the representations and warranties of the Servicer made
in the Sale and Servicing Agreement and (viii) all proceeds of the foregoing.
As of February 29, 2000, the pool consisted of the following number of
Contracts with the following delinquency characteristics:
Delinquency Experience of Contracts as of February 29, 2000:
Number of Loans Balance
31-60 days past due 538 $ 4,746,127.00
61-90 days past due 94 $ 780,938.00
91 or more days past due 61 $ 540,751.00
----- --------------
Total 693 $ 6,067,816.00
Additional information concerning the pool balance, payment of
principal and interest, prepayments, the servicing fee, the weighted maturity
and seasoning, the pool factor, and other information relating to the Contracts
may be obtained in the monthly reports provided to the Trustee by the Servicer
and filed on behalf of the Trust on the Forms 8-K listed below in Part IV, Item
14(b).
The registrant has prepared this Form 10-K in reliance upon various
no-action letters issued by the securities and Exchange Commission to other
trusts which are substantially similar to the Trust. Items designated herein as
"Not Applicable" have been omitted as a result of such reliance.
Item 1. Business.
--------
Not Applicable.
Item 2. Properties.
----------
See the introductory statement to Part I above for a
description of the property of the Trust.
Item 3. Legal Proceedings.
-----------------
To the best knowledge of the registrant, there are no material pending
legal proceedings involving the Trust, the Servicer, the Owner Trustee or the
Indenture Trustee.
Item 4. Submission of Matters to a Vote of Security Holders.
---------------------------------------------------
None.
PART II
Item 5. Market for Registrant's Common Equity and Related Securityholders
----------------------------------------------------------------------
Matters.
-------
(a) To the best knowledge of the registrant, there is no established
public trading market for the Notes or the Certificates.
(b) The Notes are represented by four certificates registered in the
name of Cede & Co., the nominee of The Depository Trust Company ("DTC"). The
Certificates are represented by one certificate registered in the name of Cede &
Co., the nominee of DTC.
Item 6. Selected Financial Data.
-----------------------
Not Applicable.
Item 7. Management's Discussion and Analysis of Financial
-------------------------------------------------
Condition and Results of Operation.
----------------------------------
Not Applicable.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk.
----------------------------------------------------------
Not Applicable.
Item 8. Financial Statements and Supplementary Data.
-------------------------------------------
Not Applicable.
Item 9. Changes in and Disagreements with Accountants on Accounting and
----------------------------------------------------------------------
Financial Disclosure.
--------------------
None.
PART III
Item 10. Directors and Executive Officers of the Registrant.
--------------------------------------------------
Not Applicable.
Item 11. Executive Compensation.
----------------------
Not Applicable.
Item 12. Security Ownership of Certain Beneficial Owners and Management.
--------------------------------------------------------------
(a) The Notes and the Certificates are represented by five
certificates registered in the name of Cede & Co., and an investor holding an
interest in the Notes or the Certificates is not entitled to receive a
certificate representing such interest except in certain limited circumstances.
Accordingly, Cede & Co. is the sole holder of record of the Notes and the
Certificates, which it holds on behalf of brokers, dealers, banks and other
direct participants in the DTC system. Such direct participants may hold Notes
or Certificates for their own accounts or for the accounts of their customers.
The address of Cede & Co. is c/o The Depository Trust Company, 55 Water Street,
New York, New York 10041.
(b) Not Applicable.
(c) Not Applicable.
Item 13. Certain Relationships and Related Transactions.
----------------------------------------------
(a) To the best knowledge of the registrant, there were no
transactions, or series of similar transactions, during the fiscal year ended
February 29, 2000, and are no currently proposed transactions, or series of
similar transactions, to which the Trust was or is to be a party, in which the
amount involved exceeds $60,000 and in which any person known to the registrant
to own of record or beneficially more than 5.00% of the Notes and the
Certificates had, or will have, a direct or indirect material interest.
(b) Not Applicable.
(c) Not Applicable.
(d) Not Applicable.
PART IV
Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K.
----------------------------------------------------------------
(a) Documents.
1. Financial Statements.
Not Applicable.
2. Financial Statement Schedules.
Not Applicable.
3. Exhibits.
See Item 14(c).
(b) Reports on Form 8-K.
The registrant filed the following Current Reports on Form 8-K with
respect to the fiscal year ended February 29, 2000: Current Reports on Form 8-K
dated December 15, 1999, January 18, 2000, February 15, 2000 and March 15, 2000
reporting Items 5 and 7(c) and providing the Statements to Noteholders and
Certificateholders for the months of November 1999, December 1999, January 2000
and February 2000.
(c) Exhibits.
Exhibit 99.1 Annual Report of Accountant relative to servicing.
(d) Financial Statement Schedules.
Not Applicable.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following person on behalf of the
registrant and in the capacities and on the dates indicated.
Carmax Auto Receivables LLC,
as Seller (Co-Registrant) and as
Depositor on behalf of CarMax Auto
Owner Trust 1999-1 (Co-Registrant)
By: /s/Michael T. Chalifoux
Michael T. Chalifoux
President and Assistant
Secretary
Date: May 17, 2000
INDEX TO EXHIBITS
Exhibit Description
Number of Exhibit
99.1 Annual Report of Accountant Relative to
Servicing.
EXHIBIT 99.1 -- Annual Report of Accountant Relative to Servicing
The Board of Directors
CarMax Auto Superstores, Inc.:
We have examined management's assertion about CarMax Auto Superstores, Inc.'s
(CarMax) compliance, as Servicer, with section 3.9 of the Sale and Servicing
Agreement, dated October 1, 1999 (the "Agreement"), between CarMax Auto
Receivables, LLC, as Seller, CarMax, as Servicer, and CarMax Auto Owner Trust
1999-1, for the period from October 1, 1999 to February 29, 2000, included in
the accompanying Management Report. Management is responsible for CarMax's
compliance with those requirements. Our responsibility is to express an opinion
on management's assertion about CarMax's compliance based on our examination.
Our examination was made in accordance with standards established by the
American Institute of Certified Public Accountants and accordingly, included
examining, on a test basis, evidence about CarMax's compliance with those
requirements and performing such procedures as we considered necessary in the
circumstances. We believe that our examination provides a reasonable basis for
our opinion. Our examination does not provide a legal determination on CarMax's
compliance with specified requirements.
In our opinion, management's assertion that CarMax Auto Superstores, Inc.
complied with the requirements of the aforementioned section of the Agreement
for the year ended February 29, 2000 is fairly stated, in all material respects.
/s/KPMG LLP
KPMG LLP
April 21, 2000
Management Report
Management of CarMax Auto Superstores, Inc. (CarMax), as Servicer, is
responsible for compliance with the servicing requirements in section 3.9 of the
Sale and Servicing Agreement dated October 1, 1999 (the "Agreement"), between
CarMax Auto Receivables, LLC, as Seller, CarMax, as Servicer, and CarMax Auto
Owner Trust 1999-1.
Management has performed an evaluation of CarMax's compliance with the
aforementioned section of the Agreement for the period from October 1, 1999 to
February 29, 2000. Based upon this evaluation, management believes that, for the
period from October 1, 1999 to February 29, 2000, CarMax, as Servicer, was
materially in compliance with the aforementioned section of the Agreement.
/s/Philip J. Dunn
Philip J. Dunn
Treasurer and Assistant Secretary
April 21, 2000
