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WARRANT

> > > THE SECURITIES REPRESENTED HEREBY AND THE SECURITIES ISSUABLE UPON
> > > EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES
> > > SECURITIES ACT OF 1933, AS AMENDED (THE “1933 ACT”), OR THE SECURITIES
> > > LAWS OF ANY STATE OF THE UNITED STATES. THESE SECURITIES MAY NOT BE
> > > OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED UNLESS SUCH SECURITIES ARE
> > > REGISTERED UNDER THE 1933 ACT AND APPLICABLE STATE SECURITIES LAWS OR SUCH
> > > SECURITIES ARE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED IN A
> > > TRANSACTION THAT DOES NOT REQUIRE REGISTRATION UNDER THE 1933 ACT OR ANY
> > > APPLICABLE STATE SECURITIES LAW AND THE COMPANY WILL BE PROVIDED WITH
> > > OPINION OF COUNSEL IN A FORM REASONABLY ACCEPTABLE TO THE COMPANY OR OTHER
> > > SUCH INFORMATION AS IT MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH
> > > EXEMPTIONS ARE AVAILABLE.
> > > 
> > > WITHOUT COMPLIANCE WITH ALL APPLICABLE CANADIAN SECURITIES LEGISLATION,
> > > THE SECURITIES REPRESENTED BY THIS CERTIFICATE MAY NOT BE SOLD,
> > > TRANSFERRED, HYPOTHECATED OR OTHERWISE TRADED IN CANADA OR TO OR FOR THE
> > > BENEFIT OF A CANADIAN RESIDENT UNTIL JULY 1, 2007

CARBIZ INC.

Warrant To Purchase Common Shares

Warrant No.: _____ Number of Shares: 1,250,000

Date of Issuance: February 28, 2007

Carbiz Inc., an Ontario, Canada corporation (the “Company”), hereby certifies
that, for Ten United States Dollars ($10.00) and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
Trafalgar Capital Specialized Investment Fund, Luxembourg, (“Trafalgar”), the
registered holder hereof or its permitted assigns, is entitled, subject to the
terms set forth below, to purchase from the Company upon surrender of this
Warrant, at any time or times on or after the date hereof, but not after 11:59
P.M. Eastern Time on the Expiration Date (as defined herein) one million two
hundred fifty thousand (1,250,000) fully paid and nonassessable shares of Common
Shares (as defined herein) of the Company (the “Warrant Shares”) at the exercise
price per share provided in Section 1(b) below or as

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subsequently adjusted; provided, however, that in no event shall the holder be
entitled to exercise this Warrant for a number of Warrant Shares in excess of
that number of Warrant Shares which, upon giving effect to such exercise, would
cause the aggregate number of shares of Common Shares beneficially owned by the
holder and its affiliates to exceed 4.99% of the outstanding shares of the
Common Shares following such exercise, except within sixty (60) days of the
Expiration Date. For purposes of the foregoing proviso, the aggregate number of
shares of Common Shares beneficially owned by the holder and its affiliates
shall include the number of shares of Common Shares issuable upon exercise of
this Warrant with respect to which the determination of such proviso is being
made, but shall exclude shares of Common Shares which would be issuable upon (i)
exercise of the remaining, unexercised Warrants beneficially owned by the holder
and its affiliates and (ii) exercise or conversion of the unexercised or
unconverted portion of any other securities of the Company beneficially owned by
the holder and its affiliates (including, without limitation, any convertible
notes or preferred stock) subject to a limitation on conversion or exercise
analogous to the limitation contained herein. Except as set forth in the
preceding sentence, for purposes of this paragraph, beneficial ownership shall
be calculated in accordance with Section 13(d) of the Securities Exchange Act of
1934, as amended. For purposes of this Warrant, in determining the number of
outstanding shares of Common Shares a holder may rely on the number of
outstanding shares of Common Shares as reflected in (1) the Company’s most
recent Form 10-QSB or Form 10-KSB, or such comparable form as the case may be,
(2) a more recent public announcement by the Company or (3) any other notice by
the Company or its transfer agent setting forth the number of shares of Common
Shares outstanding. Upon the written request of any holder, the Company shall
promptly, but in no event later than one (1) Business Day following the receipt
of such notice, confirm in writing to any such holder the number of shares of
Common Shares then outstanding. In any case, the number of outstanding shares of
Common Shares shall be determined after giving effect to the exercise of
Warrants (as defined below) by such holder and its affiliates since the date as
of which such number of outstanding shares of Common Shares was reported.

          Section 1.

                    (a)      This Warrant is the Common Shares purchase warrant
(the “Warrant”) issued pursuant to a secured convertible debenture dated
February 28, 2007 by and between the Company and Trafalgar (the “Convertible
Debenture”).

                    (b)      Definitions. The following words and terms as used
in this Warrant shall have the following meanings:

                              (i)      “Approved Stock Plan” means any employee
benefit plan which has been approved by the Board of Directors of the Company,
pursuant to which the Company’s securities may be issued to any employee,
officer or director for services provided to the Company.

                              (ii)      “Business Day” means any day other than
Saturday, Sunday or other day on which commercial banks in the City of New York
are authorized or required by law to remain closed.

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                              (iii)      “Closing Bid Price” means the closing
bid price of Common Shares as quoted on the Principal Market (as reported by
Bloomberg Financial Markets (“Bloomberg”) through its “Volume at Price”
function).

                              (iv)      “Common Shares” means (i) the Company’s
Common Shares, par value $.01 per share, and (ii) any capital stock into which
such Common Shares shall have been changed or any capital stock resulting from a
reclassification of such Common Shares.

                              (v)      “Excluded Securities” means, provided
such security is issued at a price which is greater than or equal to the
arithmetic average of the Closing Bid Prices of the Common Shares for the ten
(10) consecutive trading days immediately preceding the date of issuance, any of
the following: (a) any issuance by the Company of securities in connection with
a strategic partnership or a joint venture (the primary purpose of which is not
to raise equity capital), (b) any issuance by the Company of securities as
consideration for a merger or consolidation or the acquisition of a business,
product, license, or other assets of another person or entity and (c) options to
purchase shares of Common Shares, provided (I) such options are issued after the
date of this Warrant to employees of the Company within thirty (30) days of such
employee’s starting his employment with the Company, and (II) the exercise price
of such options is not less than the Closing Bid Price of the Common Shares on
the date of issuance of such option.

                              (vi)      “Expiration Date” means the date five
(5) years from the Issuance Date of this Warrant or, if such date falls on a
Saturday, Sunday or other day on which banks are required or authorized to be
closed in the City of New York or the State of New York or on which trading does
not take place on the Principal Exchange or automated quotation system on which
the Common Shares is traded (a “Holiday”), the next date that is not a Holiday.

                              (vii)      “Issuance Date” means the date hereof.

                              (viii)      “Options” means any rights, warrants
or options to subscribe for or purchase Common Shares or Convertible Securities.

                              (ix)      “Other Securities” means (i) those
options and warrants of the Company issued prior to, and outstanding on, the
Issuance Date of this Warrant, (ii) the shares of Common Shares issuable on
exercise of such options and warrants, provided such options and warrants are
not amended after the Issuance Date of this Warrant and (iii) the shares of
Common Shares issuable upon exercise of this Warrant.

                              (x)      “Person” means an individual, a limited
liability company, a partnership, a joint venture, a corporation, a trust, an
unincorporated organization and a government or any department or agency
thereof.

                              (xi)      “Principal Market” means the New York
Stock Exchange, the American Stock Exchange, the Nasdaq Global Market, the
Nasdaq Capital Market, whichever is at the time the principal trading exchange
or market for such security, or the over-the-counter market on the electronic
bulletin board for such security as reported by Bloomberg or, if no bid or sale
information is reported for such security by Bloomberg, then the average of the
bid prices

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of each of the market makers for such security as reported in the “pink sheets”
by the National Quotation Bureau, Inc.

                              (xii)      “Securities Act” means the Securities
Act of 1933, as amended.

                              (xiii)      “Warrant” means this Warrant and all
Warrants issued in exchange, transfer or replacement thereof.

                              (xiv)      “Warrant Exercise Price” shall be
fifteen cents (US$0.15), or as subsequently adjusted as provided in Section 8
hereof.

                              (xv)      “Warrant Shares” means the shares of
Common Shares issuable at any time upon exercise of this Warrant.

                    (c)      Other Definitional Provisions.

                              (i)      Except as otherwise specified herein, all
references herein (A) to the Company shall be deemed to include the Company’s
successors and (B) to any applicable law defined or referred to herein shall be
deemed references to such applicable law as the same may have been or may be
amended or supplemented from time to time.

                              (ii)      When used in this Warrant, the words
“herein”, “hereof”, and “hereunder” and words of similar import, shall refer to
this Warrant as a whole and not to any provision of this Warrant, and the words
“Section”, “Schedule”, and “Exhibit” shall refer to Sections of, and Schedules
and Exhibits to, this Warrant unless otherwise specified.

                              (iii)      Whenever the context so requires, the
neuter gender includes the masculine or feminine, and the singular number
includes the plural, and vice versa.

          Section 2.      Exercise of Warrant. Subject to the terms and
conditions hereof, this Warrant may be exercised by the holder hereof then
registered on the books of the Company, pro rata as hereinafter provided, at any
time on any Business Day on or after the opening of business on such Business
Day, commencing with the first day after the date hereof, and prior to 11:59
P.M. Eastern Time on the Expiration Date, by (i) delivery of a written notice,
in the form of the subscription notice attached as Exhibit A hereto (the
“Exercise Notice”), of such holder’s election to exercise this Warrant, which
notice shall specify the number of Warrant Shares to be purchased, (ii) payment
to the Company of an amount equal to the Warrant Exercise Price(s) applicable to
the Warrant Shares being purchased, multiplied by the number of Warrant Shares
(at the applicable Warrant Exercise Price) as to which this Warrant is being
exercised (plus any applicable issue or transfer taxes) (the “Aggregate Exercise
Price”): (a) in cash or wire transfer of immediately available funds, (b) using
shares of Common Stock of the Company having a fair market value equal to the
Aggregate Exercise Price, or (c) by delivery of a written notice of Net
Exercise, as defined in the following paragraph and (iii) the surrender of this
Warrant (or an indemnification undertaking with respect to this Warrant in the
case of its loss, theft or destruction) to a common carrier for overnight
delivery to the Company as soon as practicable following such date. In the event
of any exercise of the rights represented by this Warrant in compliance with
this Section 2(a), the Company shall on the fifth (5th) Business Day following
the date of receipt of the Exercise Notice, the Aggregate Exercise Price and
this

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Warrant (or an indemnification undertaking with respect to this Warrant in the
case of its loss, theft or destruction) and the receipt of the representations
of the holder specified in Section 6 hereof, if requested by the Company (the
“Exercise Delivery Documents”), and if the Common Shares is DTC eligible credit
such aggregate number of shares of Common Shares to which the holder shall be
entitled to the holder’s or its designee’s balance account with The Depository
Trust Company; provided, however, if the holder who submitted the Exercise
Notice requested physical delivery of any or all of the Warrant Shares, or, if
the Common Shares is not DTC eligible then the Company shall, on or before the
fifth (5th) Business Day following receipt of the Exercise Delivery Documents,
issue and surrender to a common carrier for overnight delivery to the address
specified in the Exercise Notice, a certificate, registered in the name of the
holder, for the number of shares of Common Shares to which the holder shall be
entitled pursuant to such request. Upon delivery of the Exercise Notice and
Aggregate Exercise Price referred to in clause (ii) above the holder of this
Warrant shall be deemed for all corporate purposes to have become the holder of
record of the Warrant Shares with respect to which this Warrant has been
exercised. In the case of a dispute as to the determination of the Warrant
Exercise Price, the Closing Bid Price or the arithmetic calculation of the
Warrant Shares, the Company shall promptly issue to the holder the number of
Warrant Shares that is not disputed and shall submit the disputed determinations
or arithmetic calculations to the holder via facsimile within one (1) Business
Day of receipt of the holder’s Exercise Notice. If the holder and the Company
are unable to agree upon the determination of the Warrant Exercise Price or
arithmetic calculation of the Warrant Shares within one (1) day of such disputed
determination or arithmetic calculation being submitted to the holder, then the
Company shall immediately submit via facsimile (i) the disputed determination of
the Warrant Exercise Price or the Closing Bid Price to an independent, reputable
investment banking firm or (ii) the disputed arithmetic calculation of the
Warrant Shares to its independent, outside accountant. The Company shall cause
the investment banking firm or the accountant, as the case may be, to perform
the determinations or calculations and notify the Company and the holder of the
results no later than forty-eight (48) hours from the time it receives the
disputed determinations or calculations. Such investment banking firm’s or
accountant’s determination or calculation, as the case may be, shall be deemed
conclusive absent manifest error.

          In lieu of exercising this Warrant via cash payment or delivery of
shares, holder may elect to receive shares equal to the value of this Warrant
(or portion thereof being exercised) by surrender of this Warrant at the
principal office of the Company together with notice of election to exercise by
means of a Net Exercise in which event the Company shall issue to holder a
number of shares of the Company computed using the following formula:

  X= Y(A-B)               A         Where X = the number of shares of Common
Stock to be issued to the holder      

Y =

the number of shares of Common Stock purchasable under this Warrant or, if only
a portion of this Warrant is being exercised, the portion of this Warrant being
exercised (at the date of such calculation)

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A = the Fair Market Value of one share of the Company’s Common Stock (at the
date of such calculation)         B = the Exercise Price per share (as adjusted
to the date of such calculation).

          The foregoing notwithstanding, this Warrant may be exercised only by
the payment of cash as provided under clause (ii)(a) of the first paragraph of
Section 2 above in the event that at the time of exercise the Company is not in
default under the Convertible Debentures and the Warrant Shares are subject to
an effective registration statement or are capable of being freely transferred
within the United States by the Warrant holder pursuant to Regulation S.

                    (a)      Unless the rights represented by this Warrant shall
have expired or shall have been fully exercised, the Company shall, as soon as
practicable and in no event later than five (5) Business Days after any exercise
and at its own expense, issue a new Warrant identical in all respects to this
Warrant exercised except it shall represent rights to purchase the number of
Warrant Shares purchasable immediately prior to such exercise under this Warrant
exercised, less the number of Warrant Shares with respect to which such Warrant
is exercised.

                    (b)      No fractional Warrant Shares are to be issued upon
any pro rata exercise of this Warrant, but rather the number of Warrant Shares
issued upon such exercise of this Warrant shall be rounded up or down to the
nearest whole number.

                    (c)      If the Company or its Transfer Agent shall fail for
any reason or for no reason to issue to the holder within ten (10) days of
receipt of the Exercise Delivery Documents, a certificate for the number of
Warrant Shares to which the holder is entitled or to credit the holder’s balance
account with The Depository Trust Company for such number of Warrant Shares to
which the holder is entitled upon the holder’s exercise of this Warrant, the
Company shall, in addition to any other remedies under this Warrant or the
Placement Agent Agreement or otherwise available to such holder, pay as
additional damages in cash to such holder on each day the issuance of such
certificate for Warrant Shares is not timely effected an amount equal to 0.025%
of the product of (A) the sum of the number of Warrant Shares not issued to the
holder on a timely basis and to which the holder is entitled, and (B) the
Closing Bid Price of the Common Shares for the trading day immediately preceding
the last possible date which the Company could have issued such Common Shares to
the holder without violating this Section 2.

                    (d)      If within ten (10) days after the Company’s receipt
of the Exercise Delivery Documents, the Company fails to deliver a new Warrant
to the holder for the number of Warrant Shares to which such holder is entitled
pursuant to Section 2 hereof, then, in addition to any other available remedies
under this Warrant or the Placement Agent Agreement, or otherwise available to
such holder, the Company shall pay as additional damages in cash to such holder
on each day after such tenth (10th) day that such delivery of such new Warrant
is not timely effected in an amount equal to 0.25% of the product of (A) the
number of Warrant Shares represented by the portion of this Warrant which is not
being exercised and (B) the Closing Bid Price of the Common Shares for the
trading day immediately preceding the last possible date which the Company could
have issued such Warrant to the holder without violating this Section 2.

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                    (e)      This Warrant may not be exercised unless an
exemption is available from the registration requirements under the United
States Securities Act of 1933, as amended (the “U.S. Securities Act”), and the
securities laws of all applicable states, and the Company has received an
opinion of counsel or other evidence to such effect satisfactory to it;
provided, however, that a holder who acquired this Warrant in the Company’s
private placement of such securities who was and remains outside the United
States and not a “U.S. person,” as such term is defined in Regulation S under
the U.S. Securities Act, will not be required to deliver an opinion of counsel
in connection with the exercise of such Warrant. Upon exercise of this Warrant,
the certificate representing the Warrant Shares will bear a legend restricting
transfer without registration under the U.S. Securities Act and applicable state
securities laws unless an exemption from registration is available and will
contain any other restrictions required by applicable United States federal or
state securities laws. Further, without compliance with all applicable Canadian
securities legislation, the securities represented by this certificate may not
be sold, transferred, hypothecated or otherwise traded in Canada or to or for
the benefit of a Canadian resident until July 1, 2007.

          Section 3.      Covenants as to Common Shares. The Company hereby
covenants and agrees as follows:

                    (a)      This Warrant is, and any Warrants issued in
substitution for or replacement of this Warrant will upon issuance be, duly
authorized and validly issued.

                    (b)      All Warrant Shares which may be issued upon the
exercise of the rights represented by this Warrant will, upon issuance, be
validly issued, fully paid and nonassessable and free from all taxes, liens and
charges with respect to the issue thereof.

                    (c)      During the period within which the rights
represented by this Warrant may be exercised, the Company will at all times have
authorized and reserved at least one hundred percent (100%) of the number of
shares of Common Shares needed to provide for the exercise of the rights then
represented by this Warrant and the par value of said shares will at all times
be less than or equal to the applicable Warrant Exercise Price. If at any time
the Company does not have a sufficient number of shares of Common Shares
authorized and available, then the Company shall call and hold a special meeting
of its shareholders within sixty (60) days of that time for the sole purpose of
increasing the number of authorized shares of Common Shares.

                    (d)      If at any time after the date hereof the Company
shall file a registration statement, the Company shall include the Warrant
Shares issuable to the holder, pursuant to the terms of this Warrant.

                    (e)      The Company will not, by amendment of its Articles
of Incorporation or through any reorganization, transfer of assets,
consolidation, merger, dissolution, issue or sale of securities, or any other
voluntary action, avoid or seek to avoid the observance or performance of any of
the terms to be observed or performed by it hereunder, but will at all times in
good faith assist in the carrying out of all the provisions of this Warrant and
in the taking of all such action as may reasonably be requested by the holder of
this Warrant in order to protect the exercise

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privilege of the holder of this Warrant against dilution or other impairment,
consistent with the tenor and purpose of this Warrant. The Company will not
increase the par value of any shares of Common Shares receivable upon the
exercise of this Warrant above the Warrant Exercise Price then in effect, and
(ii) will take all such actions as may be necessary or appropriate in order that
the Company may validly and legally issue fully paid and nonassessable shares of
Common Shares upon the exercise of this Warrant.

                    (f)      This Warrant will be binding upon any entity
succeeding to the Company by merger, consolidation or acquisition of all or
substantially all of the Company’s assets.

          Section 4.      Taxes. The Company shall pay any and all taxes, except
any applicable withholding, which may be payable with respect to the issuance
and delivery of Warrant Shares upon exercise of this Warrant.

          Section 5.      Warrant Holder Not Deemed a Shareholder. Except as
otherwise specifically provided herein, no holder, as such, of this Warrant
shall be entitled to vote or receive dividends or be deemed the holder of shares
of capital stock of the Company for any purpose, nor shall anything contained in
this Warrant be construed to confer upon the holder hereof, as such, any of the
rights of a shareholder of the Company or any right to vote, give or withhold
consent to any corporate action (whether any reorganization, issue of stock,
reclassification of stock, consolidation, merger, conveyance or otherwise),
receive notice of meetings, receive dividends or subscription rights, or
otherwise, prior to the issuance to the holder of this Warrant of the Warrant
Shares which he or she is then entitled to receive upon the due exercise of this
Warrant. In addition, nothing contained in this Warrant shall be construed as
imposing any liabilities on such holder to purchase any securities (upon
exercise of this Warrant or otherwise) or as a shareholder of the Company,
whether such liabilities are asserted by the Company or by creditors of the
Company. Notwithstanding this Section 5, the Company will provide the holder of
this Warrant with copies of the same notices and other information given to the
shareholders of the Company generally, contemporaneously with the giving thereof
to the shareholders.

          Section 6.      Representations of Holder. If such holder cannot make
the appropriate representations set forth in the Exercise Notice in order to
confirm compliance with any applicable United States federal or state securities
laws, the Company is under no obligation to issue the Warrant Shares.

          Section 7.      Ownership and Transfer.

                    (a)      The Company shall maintain at its principal
executive offices (or such other office or agency of the Company as it may
designate by notice to the holder hereof), a register for this Warrant, in which
the Company shall record the name and address of the person in whose name this
Warrant has been issued, as well as the name and address of each transferee. The
Company may treat the person in whose name any Warrant is registered on the
register as the owner and holder thereof for all purposes, notwithstanding any
notice to the contrary, but in all events recognizing any transfers made in
accordance with the terms of this Warrant.

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          Section 8.      Adjustment of Warrant Exercise Price and Number of
Shares. Other than as a result of (i) issuances or sales of any Options or
Warrants to purchase Common Shares directly to Trafalgar, or any Person which
controls, is controlled by, or is under common control with, Trafalgar, or as a
result of the issuance of any Common Shares upon the conversion of the
Convertible Debenture or any other convertible debentures issued to Trafalgar,
or any Person which controls, is controlled by, or is under common control with,
Trafalgar, or (ii) the issuance to other Persons of Warrants and/or Convertible
Securities which contain terms that would require an adjustment under this
Section 8 but for the waiver of such adjustment by Trafalgar, which waiver is
received prior to the issuance thereof, the Warrant Exercise Price and the
number of Common Shares issuable upon exercise of this Warrant shall be adjusted
from time to time as follows:

                    (a)      Adjustment of Warrant Exercise Price and Number of
Shares upon Issuance of Common Shares. If and whenever on or after the Issuance
Date of this Warrant, the Company issues or sells, or is deemed to have issued
or sold, any shares of Common Shares (other than (i) Excluded Securities and
(ii) shares of Common Shares which are issued or deemed to have been issued by
the Company in connection with an Approved Stock Plan or upon exercise or
conversion of the Other Securities) for a consideration per share less than a
price (the “Applicable Price”) equal to the Warrant Exercise Price in effect
immediately prior to such issuance or sale, then immediately after such issue or
sale the Warrant Exercise Price then in effect shall be reduced to an amount
equal to such consideration per share. Upon each such adjustment of the Warrant
Exercise Price hereunder, the number of Warrant Shares issuable upon exercise of
this Warrant shall be adjusted to the number of shares determined by multiplying
the Warrant Exercise Price in effect immediately prior to such adjustment by the
number of Warrant Shares issuable upon exercise of this Warrant immediately
prior to such adjustment and dividing the product thereof by the Warrant
Exercise Price resulting from such adjustment.

                    (b)      Effect on Warrant Exercise Price of Certain Events.
For purposes of determining the adjusted Warrant Exercise Price under Section
8(a) above, the following shall be applicable:

                              (i)      Issuance of Options. If after the date
hereof, the Company in any manner grants any Options and the lowest price per
share for which one share of Common Shares is issuable upon the exercise of any
such Option or upon conversion or exchange of any convertible securities
issuable upon exercise of any such Option is less than the Applicable Price,
then such share of Common Shares shall be deemed to be outstanding and to have
been issued and sold by the Company at the time of the granting or sale of such
Option for such price per share. For purposes of this Section 8(b)(i), the
lowest price per share for which one share of Common Shares is issuable upon
exercise of such Options or upon conversion or exchange of such Convertible
Securities shall be equal to the sum of the lowest amounts of consideration (if
any) received or receivable by the Company with respect to any one share of
Common Shares upon the granting or sale of the Option, upon exercise of the
Option or upon conversion or exchange of any convertible security issuable upon
exercise of such Option. No further adjustment of the Warrant Exercise Price
shall be made upon the actual issuance of such Common Shares or of such
convertible securities upon the exercise of such Options or upon the actual
issuance of such Common Shares upon conversion or exchange of such convertible
securities.

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                              (ii)      Issuance of Convertible Securities. If
the Company in any manner issues or sells any convertible securities and the
lowest price per share for which one share of Common Shares is issuable upon the
conversion or exchange thereof is less than the Applicable Price, then such
share of Common Shares shall be deemed to be outstanding and to have been issued
and sold by the Company at the time of the issuance or sale of such convertible
securities for such price per share. For the purposes of this Section 8(b)(ii),
the lowest price per share for which one share of Common Shares is issuable upon
such conversion or exchange shall be equal to the sum of the lowest amounts of
consideration (if any) received or receivable by the Company with respect to one
share of Common Shares upon the issuance or sale of the convertible security and
upon conversion or exchange of such convertible security. No further adjustment
of the Warrant Exercise Price shall be made upon the actual issuance of such
Common Shares upon conversion or exchange of such convertible securities, and if
any such issue or sale of such convertible securities is made upon exercise of
any Options for which adjustment of the Warrant Exercise Price had been or are
to be made pursuant to other provisions of this Section 8(b), no further
adjustment of the Warrant Exercise Price shall be made by reason of such issue
or sale.

                              (iii)      Change in Option Price or Rate of
Conversion. If the purchase price provided for in any Options, the additional
consideration, if any, payable upon the issue, conversion or exchange of any
convertible securities, or the rate at which any convertible securities are
convertible into or exchangeable for Common Shares changes at any time, the
Warrant Exercise Price in effect at the time of such change shall be adjusted to
the Warrant Exercise Price which would have been in effect at such time had such
Options or convertible securities provided for such changed purchase price,
additional consideration or changed conversion rate, as the case may be, at the
time initially granted, issued or sold and the number of Warrant Shares issuable
upon exercise of this Warrant shall be correspondingly readjusted. For purposes
of this Section 8(b)(iii), if the terms of any Option or convertible security
that was outstanding as of the Issuance Date of this Warrant are changed in the
manner described in the immediately preceding sentence, then such Option or
convertible security and the Common Shares deemed issuable upon exercise,
conversion or exchange thereof shall be deemed to have been issued as of the
date of such change. No adjustment pursuant to this Section 8(b) shall be made
if such adjustment would result in an increase of the Warrant Exercise Price
then in effect.

                    (c)      Effect on Warrant Exercise Price of Certain Events.
For purposes of determining the adjusted Warrant Exercise Price under Sections
8(a) and 8(b), the following shall be applicable:

                              (i)      Calculation of Consideration Received. If
any Common Shares, Options or convertible securities are issued or sold or
deemed to have been issued or sold for cash, the consideration received
therefore will be deemed to be the net amount received by the Company therefore.
If any Common Shares, Options or convertible securities are issued or sold for a
consideration other than cash, the amount of such consideration received by the
Company will be the fair value of such consideration, except where such
consideration consists of marketable securities, in which case the amount of
consideration received by the Company will be the market price of such
securities on the date of receipt of such securities. If any Common Shares,
Options or convertible securities are issued to the owners of the non-surviving
entity in connection with any merger in which the Company is the surviving
entity, the amount of

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consideration therefore will be deemed to be the fair value of such portion of
the net assets and business of the non-surviving entity as is attributable to
such Common Shares, Options or convertible securities, as the case may be. The
fair value of any consideration other than cash or securities will be determined
jointly by the Company and the holders of Warrants representing at least
two-thirds (b) of the Warrant Shares issuable upon exercise of the Warrants then
outstanding. If such parties are unable to reach agreement within ten (10) days
after the occurrence of an event requiring valuation (the “Valuation Event”),
the fair value of such consideration will be determined within five (5) Business
Days after the tenth (10th) day following the Valuation Event by an independent,
reputable appraiser jointly selected by the Company and the holders of Warrants
representing at least two-thirds (b) of the Warrant Shares issuable upon
exercise of the Warrants then outstanding. The determination of such appraiser
shall be final and binding upon all parties and the fees and expenses of such
appraiser shall be borne jointly by the Company and the holders of Warrants.

                              (ii)      Integrated Transactions. In case any
Option is issued in connection with the issue or sale of other securities of the
Company, together comprising one integrated transaction in which no specific
consideration is allocated to such Options by the parties thereto, the Options
will be deemed to have been issued for a consideration of $.01.

                              (iii)      Treasury Shares. The number of shares
of Common Shares outstanding at any given time does not include shares owned or
held by or for the account of the Company, and the disposition of any shares so
owned or held will be considered an issue or sale of Common Shares.

                              (iv)      Record Date. If the Company takes a
record of the holders of Common Shares for the purpose of entitling them (1) to
receive a dividend or other distribution payable in Common Shares, Options or in
convertible securities or (2) to subscribe for or purchase Common Shares,
Options or convertible securities, then such record date will be deemed to be
the date of the issue or sale of the shares of Common Shares deemed to have been
issued or sold upon the declaration of such dividend or the making of such other
distribution or the date of the granting of such right of subscription or
purchase, as the case may be.

                    (d)      Adjustment of Warrant Exercise Price upon
Subdivision or Combination of Common Shares. If the Company at any time after
the date of issuance of this Warrant subdivides (by any stock split, stock
dividend, recapitalization or otherwise) one or more classes of its outstanding
shares of Common Shares into a greater number of shares, any Warrant Exercise
Price in effect immediately prior to such subdivision will be proportionately
reduced and the number of shares of Common Shares obtainable upon exercise of
this Warrant will be proportionately increased. If the Company at any time after
the date of issuance of this Warrant combines (by combination, reverse stock
split or otherwise) one or more classes of its outstanding shares of Common
Shares into a smaller number of shares, any Warrant Exercise Price in effect
immediately prior to such combination will be proportionately increased and the
number of Warrant Shares issuable upon exercise of this Warrant will be
proportionately decreased. Any adjustment under this Section 8(d) shall become
effective at the close of business on the date the subdivision or combination
becomes effective.

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                    (e)      Distribution of Assets. If the Company shall
declare or make any dividend or other distribution of its assets (or rights to
acquire its assets) to holders of Common Shares, by way of return of capital or
otherwise (including, without limitation, any distribution of cash, stock or
other securities, property or options by way of a dividend, spin off,
reclassification, corporate rearrangement or other similar transaction) (a
“Distribution”), at any time after the issuance of this Warrant, then, in each
such case:

                              (i)      any Warrant Exercise Price in effect
immediately prior to the close of business on the record date fixed for the
determination of holders of Common Shares entitled to receive the Distribution
shall be reduced, effective as of the close of business on such record date, to
a price determined by multiplying such Warrant Exercise Price by a fraction of
which (A) the numerator shall be the Closing Sale Price of the Common Shares on
the trading day immediately preceding such record date minus the value of the
Distribution (as determined in good faith by the Company’s Board of Directors)
applicable to one share of Common Shares, and (B) the denominator shall be the
Closing Sale Price of the Common Shares on the trading day immediately preceding
such record date; and

                              (ii)      either (A) the number of Warrant Shares
obtainable upon exercise of this Warrant shall be increased to a number of
shares equal to the number of shares of Common Shares obtainable immediately
prior to the close of business on the record date fixed for the determination of
holders of Common Shares entitled to receive the Distribution multiplied by the
reciprocal of the fraction set forth in the immediately preceding clause (i), or
(B) in the event that the Distribution is of Common Shares of a company whose
Common Shares is traded on a national securities exchange or a national
automated quotation system, then the holder of this Warrant shall receive an
additional warrant to purchase Common Shares, the terms of which shall be
identical to those of this Warrant, except that such warrant shall be
exercisable into the amount of the assets that would have been payable to the
holder of this Warrant pursuant to the Distribution had the holder exercised
this Warrant immediately prior to such record date and with an exercise price
equal to the amount by which the exercise price of this Warrant was decreased
with respect to the Distribution pursuant to the terms of the immediately
preceding clause (i).

                    (f)      Certain Events. If any event occurs of the type
contemplated by the provisions of this Section 8 but not expressly provided for
by such provisions (including, without limitation, the granting of stock
appreciation rights, phantom stock rights or other rights with equity features),
then the Company’s Board of Directors will make an appropriate adjustment in the
Warrant Exercise Price and the number of shares of Common Shares obtainable upon
exercise of this Warrant so as to protect the rights of the holders of the
Warrants; provided, except as set forth in section 8(d),that no such adjustment
pursuant to this Section 8(f) will increase the Warrant Exercise Price or
decrease the number of shares of Common Shares obtainable as otherwise
determined pursuant to this Section 8.

                    (g)      Notices.

                              (i)      Immediately upon any adjustment of the
Warrant Exercise Price, the Company will give written notice thereof to the
holder of this Warrant, setting forth in reasonable detail, and certifying, the
calculation of such adjustment.

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                              (ii)      The Company will give written notice to
the holder of this Warrant at least ten (10) days prior to the date on which the
Company closes its books or takes a record (A) with respect to any dividend or
distribution upon the Common Shares, (B) with respect to any pro rata
subscription offer to holders of Common Shares or (C) for determining rights to
vote with respect to any Organic Change (as defined below), dissolution or
liquidation, provided that such information shall be made known to the public
prior to or in conjunction with such notice being provided to such holder.

                              (iii)      The Company will also give written
notice to the holder of this Warrant at least ten (10) days prior to the date on
which any Organic Change, dissolution or liquidation will take place, provided
that such information shall be made known to the public prior to or in
conjunction with such notice being provided to such holder.

          Section 9.      Purchase Rights; Reorganization, Reclassification,
Consolidation, Merger or Sale.

                    (a)      In addition to any adjustments pursuant to Section
8 above, if at any time the Company grants, issues or sells any Options,
Convertible Securities or rights to purchase stock, warrants, securities or
other property pro rata to the record holders of any class of Common Shares (the
“Purchase Rights”), then the holder of this Warrant will be entitled to acquire,
upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights
which such holder could have acquired if such holder had held the number of
shares of Common Shares acquirable upon complete exercise of this Warrant
immediately before the date on which a record is taken for the grant, issuance
or sale of such Purchase Rights, or, if no such record is taken, the date as of
which the record holders of Common Shares are to be determined for the grant,
issue or sale of such Purchase Rights.

                    (b)      Any recapitalization, reorganization,
reclassification, consolidation, merger, sale of all or substantially all of the
Company’s assets to another Person or other transaction in each case which is
effected in such a way that holders of Common Shares are entitled to receive
(either directly or upon subsequent liquidation) stock, securities or assets
with respect to or in exchange for Common Shares is referred to herein as an
“Organic Change.” Prior to the consummation of any (i) sale of all or
substantially all of the Company’s assets to an acquiring Person or (ii) other
Organic Change following which the Company is not a surviving entity, the
Company will secure from the Person purchasing such assets or the successor
resulting from such Organic Change (in each case, the “Acquiring Entity”) a
written agreement (in form and substance satisfactory to the holders of Warrants
representing at least two-thirds of the Warrant Shares issuable upon exercise of
the Warrants then outstanding) to deliver to each holder of Warrants in exchange
for such Warrants, a security of the Acquiring Entity evidenced by a written
instrument substantially similar in form and substance to this Warrant and
satisfactory to the holders of the Warrants (including an adjusted warrant
exercise price equal to the value for the Common Shares reflected by the terms
of such consolidation, merger or sale, and exercisable for a corresponding
number of shares of Common Shares acquirable and receivable upon exercise of the
Warrants without regard to any limitations on exercise, if the value so
reflected is less than any Applicable Warrant Exercise Price immediately prior
to such consolidation, merger or sale). Prior to the consummation of any other
Organic Change, the Company shall make appropriate provision (in form and
substance satisfactory to the holders of

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Warrants representing a majority of the Warrant Shares issuable upon exercise of
the Warrants then outstanding) to insure that each of the holders of the
Warrants will thereafter have the right to acquire and receive in lieu of or in
addition to (as the case may be) the Warrant Shares immediately theretofore
issuable and receivable upon the exercise of such holder’s Warrants (without
regard to any limitations on exercise), such shares of stock, securities or
assets that would have been issued or payable in such Organic Change with
respect to or in exchange for the number of Warrant Shares which would have been
issuable and receivable upon the exercise of such holder’s Warrant as of the
date of such Organic Change (without taking into account any limitations or
restrictions on the exercisability of this Warrant).

          Section 10.      Lost, Stolen, Mutilated or Destroyed Warrant. If this
Warrant is lost, stolen, mutilated or destroyed, the Company shall promptly, on
receipt of an indemnification undertaking (or, in the case of a mutilated
Warrant, the Warrant), issue a new Warrant of like denomination and tenor as
this Warrant so lost, stolen, mutilated or destroyed.

          Section 11.      Notice. Any notices, consents, waivers or other
communications required or permitted to be given under the terms of this Warrant
must be in writing and will be deemed to have been delivered: (i) upon receipt,
when delivered personally; (ii) upon receipt, when sent by facsimile (provided
confirmation of receipt is received by the sending party transmission is
mechanically or electronically generated and kept on file by the sending party);
or (iii) one Business Day after deposit with a nationally recognized overnight
delivery service, in each case properly addressed to the party to receive the
same. The addresses and facsimile numbers for such communications shall be:

If to Trafalgar: Trafalgar Capital Specialized Investment Fund, Luxembourg  
8-10 Rue Mathias Hardt   BP 3023   Luxembourg L-1030   Facsimile:  
011-44-207-405-0161   And 001-786-323-1651   With Copy to: James G. Dodrill II,
P.A.   5800 Hamilton Way   Boca Raton, FL 33496   Attention: James Dodrill, Esq.
  Telephone: (561) 862-0529   Facsimile: (561) 892-7787

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If to the Company, to: Carbiz Inc.   7405 North Tamiami Trail   Sarasota, FL
34243   Attn: Mr. Carl Ritter, CEO   Telephone: (800) 547-2277   Facsimile:
(941) 308-2718     With a copy to: Troutman Sanders LLP   222 Central Park
Avenue, Suite 2000   Virginia Beach, VA 23462   Attn: Mr. Thomas M. Rose, Esq.  
Telephone: (757) 687-7715   Facsimile: (757) 687-1529

If to a holder of this Warrant, to it at the address and facsimile number set
forth on Exhibit C hereto, with copies to such holder’s representatives as set
forth on Exhibit C, or at such other address and facsimile as shall be delivered
to the Company upon the issuance or transfer of this Warrant. Each party shall
provide five days’ prior written notice to the other party of any change in
address or facsimile number. Written confirmation of receipt (A) given by the
recipient of such notice, consent, facsimile, waiver or other communication, (or
(B) provided by a nationally recognized overnight delivery service shall be
rebuttable evidence of personal service, receipt by facsimile or receipt from a
nationally recognized overnight delivery service in accordance with clause (i),
(ii) or (iii) above, respectively.

          Section 12.      Date. The date of this Warrant is set forth on page 1
hereof. This Warrant, in all events, shall be wholly void and of no effect after
the close of business on the Expiration Date, except that notwithstanding any
other provisions hereof, the provisions of Section 8(b) shall continue in full
force and effect after such date as to any Warrant Shares or other securities
issued upon the exercise of this Warrant.

          Section 13.      Amendment and Waiver. Except as otherwise provided
herein, the provisions of the Warrants may be amended and the Company may take
any action herein prohibited, or omit to perform any act herein required to be
performed by it, only if the Company has obtained the written consent of the
holders of Warrants representing at least two-thirds of the Warrant Shares
issuable upon exercise of the Warrants then outstanding; provided that, except
for Section 8(d), no such action may increase the Warrant Exercise Price or
decrease the number of shares or class of stock obtainable upon exercise of any
Warrant without the written consent of the holder of such Warrant.

          Section 14.      Descriptive Headings; Governing Law. The descriptive
headings of the several sections and paragraphs of this Warrant are inserted for
convenience only and do not constitute a part of this Warrant. The corporate
laws of the State of Florida shall govern all issues concerning the relative
rights of the Company and its shareholders. All other questions concerning the
construction, validity, enforcement and interpretation of this Agreement shall
be governed by the internal laws of the State of Florida without giving effect
to any choice of law or conflict of law provision or rule (whether of the State
of Florida or any other jurisdictions) that would cause the application of the
laws of any jurisdictions other than the State of Florida Each

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party hereby irrevocably submits to the exclusive jurisdiction of the state
courts sitting in Broward County, Florida and the United States District Court
for the Southern District of Florida for the adjudication of any dispute
hereunder or in connection herewith or therewith, or with any transaction
contemplated hereby or discussed herein, and hereby irrevocably waives, and
agrees not to assert in any suit, action or proceeding, any claim that it is not
personally subject to the jurisdiction of any such court, that such suit, action
or proceeding is brought in an inconvenient forum or that the venue of such
suit, action or proceeding is improper. Each party hereby irrevocably waives
personal service of process and consents to process being served in any such
suit, action or proceeding by mailing a copy thereof to such party at the
address for such notices to it under this Agreement and agrees that such service
shall constitute good and sufficient service of process and notice thereof.
Nothing contained herein shall be deemed to limit in any way any right to serve
process in any manner permitted by law.

          Section 15.      Waiver of Jury Trial. AS A MATERIAL INDUCEMENT FOR
EACH PARTY HERETO TO ENTER INTO THIS WARRANT, THE PARTIES HERETO HEREBY WAIVE
ANY RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING RELATED IN ANY WAY TO THIS
WARRANT AND/OR ANY AND ALL OF THE OTHER DOCUMENTS ASSOCIATED WITH THIS
TRANSACTION.

          IN WITNESS WHEREOF, the Company has caused this Warrant to be signed
as of the date first set forth above.

CARBIZ INC.

By: ________________________________________________
Name:
Title:

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EXHIBIT A TO WARRANT

EXERCISE NOTICE

TO BE EXECUTED
BY THE REGISTERED HOLDER TO EXERCISE THIS WARRANT

CARBIZ INC.

          The undersigned holder hereby exercises the right to purchase
______________ of the shares of Common Shares (“Warrant Shares”) of Carbiz
Inc.., an Ontario, Canada corporation (the “Company”), evidenced by the attached
Warrant (the “Warrant”). Capitalized terms used herein and not otherwise defined
shall have the respective meanings set forth in the Warrant.

          1.      Form of Warrant Exercise Price. The Holder intends that
payment of the Warrant Exercise Price shall be made as a “Cash Exercise” with
respect to ______________ Warrant Shares.

          2.      Payment of Warrant Exercise Price. The holder shall pay the
sum of $______________ to the Company in accordance with the terms of the
Warrant.

          3.      Delivery of Warrant Shares. The Company shall deliver to the
holder _________ Warrant Shares in accordance with the terms of the Warrant.

          4.      The undersigned represents, warrants and certifies as follows
(only one of the following must be checked):

A. [   ]

The undersigned holder (a) acquired this Warrant directly from the Company
pursuant to a written purchase agreement for the acquisition of such securities,
(b) at the time of exercise of this Warrant is not in the United States, (c) is
not a “U.S. person” (a “U.S. Person”), as such term is defined in Regulation S
under the United States Securities Act of 1933, as amended (the “U.S. Securities
Act”), and is not exercising such securities on behalf of a U.S. Person or a
person in the United States, and (d) did not execute this Notice of Exercise in
the United States; or

   

B. [   ]

The undersigned holder has delivered to the Company a written opinion of counsel
or such other evidence in a form reasonably acceptable to the Company to the
effect that an exemption from the registration requirements of the United States
Securities Act of 1933, as amended (the “U.S. Securities Act”), and applicable
state securities laws is available for the issuance of the Warrant Shares.

The undersigned holder understands that the certificate representing the
Warrants Shares will bear a legend restricting transfer without registration
under the U.S. Securities Act and applicable state securities laws unless an
exemption from registration is available and will contain any other restrictions
required under applicable United States federal or state securities

A-1

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laws or Canadian securities laws. With respect to Box A above, the undersigned
holder agrees to provide any additional information that the Company may
reasonably request to establish that an exclusion from registration under the
U.S. Securities Act is available for the issuance of the Warrant Shares. Unless
Box B above is checked, certificates representing Common Shares will not be
registered or delivered to an address in the United States.

If Box B is checked, any opinion tendered or other evidence delivered must be in
form and substance reasonably satisfactory to the Company. Holders planning to
deliver such documentation in connection with the exercise of a Warrant should
contact the Company in advance to determine whether such documentation will be
acceptable to the Company.

Date: _______________ __, ______

Name of Registered Holder

By: _______________________________
Name: _____________________________
Title: ______________________________

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EXHIBIT B TO WARRANT

FORM OF WARRANT POWER

          FOR VALUE RECEIVED, the undersigned does hereby assign and transfer to
________________, Federal Identification No. __________, a warrant to purchase
____________ shares of the capital stock of Carbiz Inc., an Ontario, Canada
corporation, represented by warrant certificate no. _____, standing in the name
of the undersigned on the books of said corporation. The undersigned does hereby
irrevocably constitute and appoint ______________, attorney to transfer the
warrants of said corporation, with full power of substitution in the premises.

Dated: ________________________________________                          
__________________________________________________

By: _________________________________________
Name: _______________________________________
Title: ________________________________________

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