Filed by Automated Filing Services Inc. (604) 609-0244 - Carbiz Inc. - Exhibit 10.7






 

Carbiz Inc. 

7405 N. Tamiami Trail 

  Sarasota, Florida 34243

Offering of 5% Convertible Debentures

NOTICE TO PROSPECTIVE PURCHASERS IN FLORIDA


	THESE SECURITIES HAVE NOT BEEN REGISTERED
        UNDER THE FLORIDA SECURITIES ACT IN RELIANCE UPON AN EXEMPTION THEREFROM.
        ANY SALE MADE PURSUANT TO SUCH EXEMPTION IS VOIDABLE BY A FLORIDA PURCHASER
        WITHIN THREE (3) DAYS AFTER THE FIRST TENDER OF CONSIDERATION IS MADE
        BY SUCH PURCHASER TO THE ISSUER, AN AGENT OF THE ISSUER OR AN ESCROW AGENT
        IN PAYMENT FOR SUCH SECURITIES. HOWEVER, THIS RIGHT IS NOT AVAILABLE TO
        ANY PURCHASER WHO IS A BANK, TRUST COMPANY, SAVINGS INSTITUTION, INSURANCE
        COMPANY, SECURITIES DEALER, INVESTMENT COMPANY AS DEFINED IN THE INVESTMENT
        COMPANY ACT OF 1940, PENSION OR PROFIT-SHARING TRUST OR QUALIFIED INSTITUTIONAL
        BUYER AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT OF 1933.








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SUBSCRIPTION FOR 5% DEBENTURES

	TO: 	Carbiz Inc. (the "Corporation") 
	AND TO: 	Innovation Capital, LLC (the “Agent”)
  


The undersigned (the "Subscriber") hereby irrevocably
subscribes for and agrees to purchase a convertible debenture (the "Debenture")
of the Corporation for the aggregate consideration set forth below, representing
a value as set forth below, each upon and subject to the terms and conditions
set forth in the "Terms and Conditions of Subscription for Debentures of Carbiz
Inc." attached hereto and forming a part hereof (together, the "Subscription
Agreement").

	 
    	 	Amount of Debenture subscribed for: 
	______________________________________________

      Full Legal Name of Subscriber (please print) 	 	  
	  	 	US $ ________________________________________________
	By: ___________________________________________	 	  
	Authorized Signature 	 	  
	  	 	Aggregate Consideration: US $ ___________________________
	 ______________________________________________

        Official Title or Capacity (please print) 

      

        ______________________________________________
	 	  
	Name of Signatory (please print name of individual whose 	 	  
	 signature appears above if different than name of Subscriber)
      

      

        ______________________________________________
	 	  
	Subscriber's Address (including postal code) 	 	  
	 
    	 	  
	______________________________________________	 	  
	 Telephone Number (including area code)
	 	  
	 

        Register the Debenture as follows: 

      ______________________________________________
	 	 

        Deliver the Debenture as follows: 

      ______________________________________________

	 Name 

      ______________________________________________
	 	 Name 

      ______________________________________________

	 Account reference, if applicable 

      ______________________________________________
	 	 Account reference, if applicable 

      ______________________________________________

	Address (including postal code) 

      ______________________________________________
	 	 Contact Name 

      ______________________________________________

		 	Address (including postal code) 
	
      

        ______________________________________________

      	 	
      ______________________________________________ 
	 	 	Telephone Number (including area code) 
	

      ______________________________________________  	 	 


ACCEPTANCE: The Corporation hereby accepts the above
subscription on the terms and conditions contained in this Subscription
Agreement.

	CARBIZ INC. 	Date:
      _______________, 2004 	 
	 	  	  	 
	 	  	  	 
	Per: 	  	 	No:
    
	 	Carl Ritter –Chief Executive Officer
    	  


This is the first page of an agreement comprised of 7 pages
(excluding schedules).




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TERMS AND CONDITIONS OF THE SUBSCRIPTION FOR 
DEBENTURES
OF CARBIZ INC.

	1. 	Definitions. In this Subscription Agreement: 
	 	 	 
		(a) 	"1933 Act" means the United States Securities
        Act of 1933, as amended; 

	 	 	 
		(b) 	“1934 Act” means the United States
        Securities Act of 1934, as amended; 

	 	 	 
		(c) 	"Agent" means Innovation Capital, LLC; 

	 	 	 
		(d) 	"Agent’s First Warrant" means the first
        common share purchase warrant of the Corporation comprising an Agent’s
        Unit, each Agent’s First Warrant entitling the holder thereof to
        acquire a Share at a price of CDN$0.22 per Share for a period of five
        years from the Conversion Date; 

	 	 	 
		(e) 	"Agent’s Second Warrant" means the second
        common share purchase warrant of the Corporation comprising an Agent’s
        Unit, each Agent’s Second Warrant entitling the holder thereof to
        acquire a Share at a price of CDN$0.23 per Share for a period of five
        years from the Conversion Date; 

	 	 	 
		(f) 	"Agent’s Units" means units of the Corporation
        that may be issued to an Agent, each Agent’s Unit being comprised
        of one Agent’s First Warrant and one Agent’s Second Warrant;
      

	 	 	 
		(g) 	"Agent’s Warrants" means, collectively,
        the Agent’s First Warrants and the Agent’s Second Warrants;
      

	 	 	 
		(h) 	"Class A Warrant" means a Class A common share
        purchase warrant of the Corporation, each Class A Warrant entitling the
        holder thereof to acquire a Share at a price of CDN$0.23 per Share for
        a period of five years from the Closing Date; 

	 	 	 
		(i) 	"Class B Warrant" means a Class B common share
        purchase warrant of the Corporation, each whole Class B Warrant entitling
        the holder thereof to acquire a Share at a price of CDN$0.30 per Share
        for a period of five years from the Closing Date; 

	 	 	 
		(j) 	"Closing Date" means October 6, 2004 or such
        other date as may be determined by the Corporation; 

	 	 	 
		(k) 	"Conversion Date" the date on which the Corporation
        obtains a listing on the OTCBB and delists from the Exchange; 

	 	 	 
		(l) 	"Conversion Rate" means the automatic conversion
        on the Conversion Date of the Indebtedness into Units at a price of CDN$0.22
        per Unit; 

	 	 	 
		(m) 	“Exchange” means the TSX Venture
        Exchange; 

	 	 	 
		(n) 	"Interest Amount" means all accrued and unpaid
        interest as at the Conversion Date; 

	 	 	 
		(o) 	“Indebtedness” means the Principal
        Amount and the Interest Amount; 








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		(p) 	"Offering" means the offering by the Corporation
        of a minimum of US$750,000 and a maximum of US$2,000,000 principal amount
        of Debentures; 

	 	 	 
		(q) 	"OTCBB" means the United States Over the Counter
        Bulletin Board; 

	 	 	 
		(r) 	"Person" includes individuals, partnerships,
        corporations, companies and other business or legal entities; 

	 	 	 
		(s) 	"Principal Amount" means the principal amount
        of this Debenture as set forth on the face page hereof; 

	 	 	 
		(t) 	"Registration Statement" means a registration
        statement on Form S-1 or Form SB-2, if available, for a US registration
        covering the resale of the Shares included in the Units and the Warrant
        Shares; 

	 	 	 
		(u) 	"Shares" means common shares in the capital
        of the Corporation, as such shares exist at the close of business on the
        date of execution and delivery of this Debenture and shall include any
        and all shares resulting from any subdivision, redivision, reduction,
        combination or consolidation, merger, amalgamation or reorganization and
        any common shares of any company or corporation to which the Corporation
        may sell, lease or transfer or otherwise dispose of all or substantially
        all of its property and assets; 

	 	 	 
		(v) 	"Underlying Securities" means, collectively,
        the Shares comprising the Units, the Warrants and the Warrant Shares;
      

	 	 	 
		(w) 	"Unit" means a unit of the Corporation, each
        Unit being comprised of one Share, one Class A Warrant and one-half of
        one Class B Warrant; 

	 	 	 
		(x) 	"Warrants" means, collectively, the Class
        A Warrants and the Class B Warrants; and 

	 	 	 
		(y) 	"Warrant Shares" means the Shares that are
        issuable upon exercise of the Warrants. 

	 	 	 
	2. 	Acknowledgements of the Subscriber. The Subscriber acknowledges
      that: 
	 	 	 
		(a) 	this subscription is subject to rejection or acceptance
        by the Corporation in whole or in part, and is effective only upon acceptance
        by the Corporation; 

	 	 	 
		(b) 	the Debenture subscribed for it hereunder forms part
        of a larger issuance and sale by the Corporation of a minimum of US$750,000
        and a maximum of US$2,000,000 principal amount of Debentures; 

	 	 	 
		(c) 	the Debenture, at the election of the Corporation,
        shall bear a rate of interest equal to five (5%) percent per annum with
        interest payable beginning on May 1, 2005; 

	 	 	 
		(d) 	on the Conversion Date, the Indebtedness shall automatically
        convert into Units at the Conversion Rate; 

	 	 	 
		(e) 	in the event of any alteration of the Shares, including
        any subdivision, consolidation or reclassification, and in the event of
        any form of reorganization of the Corporation, including any amalgamation,
        merger or arrangement, the holders of Warrants and Agent’s Warrants
        shall, upon exercise of the Warrants or Agent’s Warrants, as the
        case may be, following the occurrence of any of those events, be entitled
        to receive the same number and kind of securities that they would have
        been entitled to receive had their 








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			Warrants or Agent’s Warrants, as the case may
        be, been exercised immediately prior to the occurrence of any such event;
      

	 	 	 
		(f) 	the Corporation shall file the Registration Statement
        no later than thirty (30) days after the Conversion Date, and use its
        best efforts to have the Registration Statement declared effective within
        one hundred eighty (180) days after the Closing Date; 

	 	 	 
		(g) 	in the event that the Corporation does not obtain
        an OTCBB listing within 180 days after the Closing Date, the Corporation
        shall issue to the Subscriber additional Warrants equal to two-percent
        (2%) of the number of Warrants to be issued upon conversion of the Debentures
        plus an additional one-percent (1%) for each subsequent 30 day period;
        provided, however, in no event shall the amount of such additional Warrants
        be in excess of six percent (6%) of the Warrants to be issued upon conversion
        of the Debenture; 

	 	 	 
		(h) 	the terms and conditions of the Registration Statement
        and other rights and preferences of the Subscriber shall be contained
        in a certain Investors’ Rights Agreement of even date herewith among
        the Corporation and all the subscribers in the Offering; 

	 	 	 
		(i) 	in consideration for the services of the Agent under
        this Offering, the Agent shall receive a cash commission of ten percent
        (10%) of the gross proceeds raised by the Agent under the Offering. In
        addition, the Agent will receive that number of Agent’s Units that
        is equal in number to ten percent (10%) of the number of Units to be issued
        on the Conversion Date in respect of Debentures placed by the Agent under
        the Offering. The Agent shall also be entitled to receive a cash fee equal
        to 2% of the gross proceeds from the subsequent exercise within twelve
        months from the Conversion Date of any Warrants that were issued upon
        conversion of Debentures placed by the Agent under the Offering; 

	 	 	 
		(j) 	the Offering is subject to the receipt of all regulatory
        approvals including, without limitation, the approval of the Exchange;
        and 

	 	 	 
		(k) 	the Subscriber is responsible for obtaining such
        legal advice as it considers appropriate in connection with the execution,
        delivery and performance by it of this Subscription Agreement. 

	 	 	 
	3. 	REPRESENTATIONS OF THE SUBSCRIBER - GENERAL 


(a) By executing this subscription, the Subscriber represents
and warrants to and covenants with the Corporation and the Agent (and
acknowledges that the Corporation, the Agent and their counsel are relying
thereon) that:

	 	(i) 	if an individual, the Subscriber is of the full age
        of majority and is legally competent to execute and deliver this Subscription
        Agreement and each of the instruments to be delivered by the Subscriber
        hereunder, to perform all of its obligations hereunder and thereunder,
        and to take all actions required pursuant hereto and thereto; 

	 	 	 
	 	(ii) 	if the Subscriber is not an individual, it has the
        requisite power, authority, legal capacity and competence to execute and
        deliver this Subscription Agreement and each of the instruments to be
        delivered by the Subscriber hereunder, to perform all of its obligations
        hereunder and thereunder, and to take all actions required pursuant hereto
        and thereto and, all necessary approvals of its directors, partners, shareholders,
        trustees or otherwise with respect to such matters have been given or
        obtained; 








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	 	(iii) 	if the Subscriber is a body corporate, it is duly
        incorporated, validly existing and in good standing under the laws of
        its jurisdiction of incorporation; 

	 	 	 
	 	(iv) 	this Subscription Agreement and such other instruments
        to be delivered hereunder have been duly and validly authorized, executed
        and delivered by, and constitute a legal, valid, binding and enforceable
        obligation of the Subscriber; 

	 	 	 
	 	(v) 	the execution, delivery and performance by the Subscriber
        of this Subscription Agreement and the completion of the transactions
        contemplated hereby do not and will not result in a violation of any law,
        regulation, order or ruling applicable to the Subscriber, and do not and
        will not constitute a breach of or default under any of the Subscriber's
        constating documents (if the Subscriber is not an individual) or any agreement
        to which the Subscriber is a party or by which it is bound; 

	 	 	 
	 	(vi) 	it has been independently advised as to the restrictions
        on resale imposed by applicable securities legislation with respect to
        the Debenture and the Underlying Securities received upon conversion of
        the Indebtedness and confirms that no representation has been made to
        it by or on behalf of the Corporation respecting such restrictions and
        it is the Subscriber’s responsibility to find out what those restrictions
        are and to comply with them before selling such securities; 

	 	 	 
	 	(vii) 	the Subscriber has been advised to consult its own
        legal and financial advisors with respect to the suitability of the Debenture
        as an investment for the Subscriber and the resale restrictions and "hold
        periods" to which the Debenture and the Underlying Securities are subject
        under applicable securities legislation, and, except for the representations
        of the Corporation expressly contained herein, has not relied upon any
        statements made by or purporting to have been made on behalf of the Corporation
        in deciding to subscribe for the Debenture hereunder; 

	 	 	 
	 	(viii) 	it is aware of the risks and other characteristics
        of the Debenture and the Underlying Securities received upon conversion
        of the Indebtedness and of the fact that the Subscriber may not be able
        to resell the Debenture and any Underlying Securities received upon conversion
        of the Indebtedness except in accordance with the applicable securities
        legislation and regulatory policy; 

	 	 	 
	 	(ix) 	it will not resell any Debenture or any Underlying
        Securities received upon conversion of the Indebtedness except in accordance
        with the provisions of applicable securities legislation; 

	 	 	 
	 	(x) 	the Subscriber understands that no securities commission,
        stock exchange, governmental agency, regulatory body or similar regulatory
        authority has made any finding or determination or expressed any opinion
        with respect to the merits of investing in, nor has any such stock exchange
        or governmental agency, authority, regulatory body, securities commission,
        or other entity made any recommendation or endorsement with respect to,
        the merits of investing in the Debenture and there is no government or
        other insurance covering the Debenture; 

	 	 	 
	 	(xi) 	it has not received, nor has it requested, nor does
        it have any need to receive, any offering memorandum or any other document
        (other than financial statements or any other document the content of
        which is prescribed by statute or regulation) describing the business
        and affairs of the Corporation which has been prepared for delivery to,
        and review by, prospective purchasers in order to assist them in making
        an investment decision in respect of the Debentures and it has not become
        aware of any advertisement 








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			in printed media of general and regular paid circulation,
        radio or television with respect to the distribution of the Debentures
        or any Underlying Securities received upon conversion of the Indebtedness;
      

	 	 	 
		(xii) 	if required by applicable securities legislation,
        policy or order or by any securities commission or other regulatory authority,
        the Subscriber will execute, deliver, file and otherwise assist the Corporation
        in filing, such reports, undertakings and other documents with respect
        to the distribution of the Debenture and any Underlying Securities received
        upon conversion of the Indebtedness as may be required; 

	 	 	 
		(xiii) 	this Subscription is made unconditionally as a result
        of the undersigned's desire to participate in the future development of
        the Corporation; and 

	 	 	 
		(xiv) 	if it is a corporation, syndicate, partnership or
        other form of unincorporated organization, it pre-existed the offering
        of the Debentures and has a bona fide purpose other than investment
        in the Debenture. 

	 	 	 
	4. 	REPRESENTATIONS OF THE SUBSCRIBER - EXEMPTIONS
    


(a) By executing this subscription, the Subscriber represents
and warrants to and covenants with the Corporation and the Agent (and
acknowledges that the Corporation, the Agent and their counsel are relying
thereon) that:

	 	(i) 	the Subscriber is an "accredited investor" as that
        term is defined in Rule 501(a) of Regulation D under the 1933 Act (which
        definition is reproduced in Schedule “A” attached hereto) by
        reason of the Subscriber’s business and financial experience and
        the business and financial experience of those persons retained to advise
        it with respect to the investment in the Debenture and the Underlying
        Securities, and has executed and delivered to the Corporation a Representation
        Letter in the form attached hereto as Schedule “A” indicating
        that the Subscriber fits within one of the categories of "accredited investor"
        set forth in such definition; 

	 	 	 
	 	(ii) 	the Subscriber acknowledges that it is not purchasing
        the Debenture or the Underlying Securities as a result of any “general
        solicitation” or “general advertising”, as those terms
        are used in Regulation D under the 1933 Act, including, without limitation,
        advertisements, articles, notices or other communications published in
        any newspaper, magazine or similar media or broadcast over television
        or radio or any seminar or meeting whose attendees have been invited by
        general solicitation or general advertising; 

	 	 	 
	 	(iii) 	the Subscriber confirms that it has such knowledge
        in financial and business affairs as to be capable of evaluating the merits
        and risks of its investment in the Debenture and Underlying Securities
        and is capable of assessing the proposed investment in the Debenture and
        the Underlying Securities as a result of the Subscriber's own experience
        or as a result of advice received from a person registered under applicable
        securities legislation and it is able, without impairing its financial
        condition, to bear the economic risks of, and understand a complete loss
        of, its investment; 

	 	 	 
	 	(iv) 	it understands that the Debenture and any Underlying
        Securities received upon conversion of the Indebtedness have not been
        and will not be registered under the 1933 Act or any applicable state
        securities laws; 

	 	 	 
	 	(v) 	except for the representations of the Corporation
        expressly contained herein, the Subscriber has relied solely upon publicly
        available information relating to the 








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	 		Corporation and not upon any verbal or written representation
        as to fact or otherwise made by or on behalf of the Corporation; 

	 	 	 
	 	(vi) 	it understands that the distribution of the Debentures
        and the Underlying Securities is being made in reliance upon a private
        placement exemption from registration under the 1933 Act and under the
        securities laws of certain states. Accordingly, the Debenture and the
        Underlying Securities will be “restricted securities” within
        the meaning of Rule 144 under the 1933 Act, and therefore may not be offered
        or sold by the undersigned, directly or indirectly, in the United States
        without registration under the United States federal and state securities
        laws, except in compliance with certain limited exemptions thereunder;
      

	 	 	 
	 	(vii) 	the undersigned understands and acknowledges that
        there may be material tax consequences to the undersigned of an acquisition
        or disposition of the Debenture and any Underlying Securities received
        upon conversion of the Indebtedness and that the undersigned should consult
        the undersigned’s own tax advisors respecting the United States federal,
        state and local and foreign tax consequences of acquiring, owning and
        disposing of such Debenture and any Underlying Securities received upon
        conversion of the Indebtedness; 

	 	 	 
	 	(viii) 	the undersigned understands that the Corporation’s
        financial statements are prepared in accordance with Canadian generally
        accepted accounting principles, which differ in some respects from United
        States generally accepted accounting principles, and thus may not be comparable
        to financial statements of United States corporations; 

	 	 	 
	 	(ix) 	the undersigned has had access to such information
        concerning the Corporation as the undersigned has considered necessary
        in connection with the undersigned’s investment decision to acquire
        the Debenture and the Underlying Securities; 

	 	 	 
	 	(x) 	the undersigned has either spoken or met with, or
        been given reasonable opportunity to speak with or meet with, representatives
        of the Corporation for the purpose of asking questions of, and receiving
        answers and information from, such representatives concerning the undersigned’s
        investment in the Debenture and the Underlying Securities; 

	 	 	 
	 	(xi) 	the undersigned understands that in making an investment
        decision, the undersigned must rely on its own examination of the Corporation
        including the merits and risks involved; 

	 	 	 
	 	(xii) 	the undersigned is acquiring the Debenture for its
        own account and not with a view to any resale, distribution or other disposition
        of the Debenture or any Underlying Securities received upon conversion
        of the Indebtedness in violation of the 1933 Act or any applicable state
        securities laws; 

	 	 	 
	 	(xiii) 	the Subscriber understands and acknowledges that
        the Corporation has the right not to record a transfer without first being
        notified by the Corporation that it is satisfied that such transfer is
        exempt from or not subject to registration under the 1933 Act and any
        applicable state securities laws; 

	 	 	 
	 	(xiv) 	the undersigned consents to the Corporation making
        a notation on its records or giving instructions to any transfer agent
        (if any) of the Debentures and any Underlying Securities received upon
        conversion of the Indebtedness in order to implement the restrictions
        on transfer set forth and described herein; 

	 	 	 
	 	(xv) 	the undersigned acknowledges that the Debenture and
        any Underlying Securities received upon conversion of the Indebtedness
        are not currently eligible for resale under Rule 144 








- 9 -

			in the United States due to the fact,
        among others, that the Corporation is not a reporting company under the
        1934 Act; and 

	 	 	 	 
		(xvi) 	the Subscriber understands that the Debentures
        and the Underlying Securities are being offered for sale only on a "private
        placement" basis and that the sale and delivery of the Debentures and
        the Underlying Securities is conditional upon such sale being exempt from
        the requirements as to the filing of a prospectus or upon the issuance
        of such orders, consents or approvals as may be required to permit such
        sale without the requirement of filing a prospectus and that as a consequence
        of acquiring the Debenture and the Underlying Securities pursuant to such
        exemptions, certain protections, rights and remedies provided by applicable
        securities legislation, including statutory rights of recission or damages,
        may not be available to the Subscriber in connection with the purchase
        and sale of the Debenture and the Underlying Securities and the Subscriber
        further acknowledges that: 

	 	 	 	 
			(A) 
	the Subscriber is restricted from using most of the
        civil remedies available under applicable securities laws; 

	 	 	 	 
			(B) 
	the Subscriber may not receive information that would
        otherwise be required to be provided to it under applicable securities
        laws; 

	 	 	 	 
			(C) 
	the Corporation is relieved from certain obligations
        that would otherwise apply under applicable securities laws; and 

	 	 	 	 
			(D) 
	the Debenture is not being purchased by it as a result
        of any information concerning the Corporation that has not been publicly
        disclosed and its decision to purchase Debenture has not been made as
        a result of any verbal or written representation as to fact or otherwise
        (including that any person will resell or repurchase or refund the purchase
        price of its Debenture), or as to the future price or value of any Underlying
        Securities received upon conversion of the Indebtedness made by or on
        behalf of the Corporation; and 

	 	 	 	 
		(xvii) 	the Subscriber confirms that neither the
        Corporation nor any of its representative directors, employees, officers
        or affiliates, have made any representations (written or oral) to the
        Subscriber: 

	 	 	 	 
			(A) 
	regarding the future value of the Underlying Securities;
      

	 	 	 	 
			(B) 
	that any person will resell or repurchase the Debenture
        or the Underlying Securities; or 

	 	 	 	 
			(C) 
	that any person will refund the purchase price of
        the Debenture other than as provided in this Subscription Agreement. 

	 	 	 	 
	5. 	TIMELINESS OF REPRESENTATIONS, ETC. 


The Subscriber agrees that the representations, warranties and
covenants of the Subscriber herein will be true and correct both as of the
execution of this Subscription Agreement and as of the Closing Date and will
survive the completion of the issuance of the Debenture and any subsequent
disposition by the Subscriber of the Underlying Securities.




- 10 -

	6. 	RELIANCE ON SUBSCRIBER’S REPRESENTATIONS



The foregoing representations, warranties and covenants are
made by the Subscriber with the intent that they be relied upon in determining
its suitability as a purchaser of a Debenture and the Subscriber hereby agrees
to indemnify the Corporation and its officers, directors, employees and agents
against all losses, claims, costs, expenses and damages or liabilities that any
of them may suffer or incur caused or arising from reliance thereon. The
Subscriber undertakes to notify the Corporation immediately at the following
addresses:

Carbiz Inc.
7560 Commerce Court 
Sarasota, Florida
34243

Attention:        Carl
Ritter, Chief Executive Officer

Facsimile:         (941)
952-9255

of any change in any representation, warranty or other information
  relating to the Subscriber set forth herein which takes place prior to Closing.

	7. 	PARTIAL ACCEPTANCE AND REJECTION OF SUBSCRIPTION


The Corporation may, in its absolute discretion, accept or reject
  the Subscriber's subscription for a Debenture as set forth in this Subscription
  Agreement, in whole or in part, and the Corporation reserves the right to sell
  to the Subscriber less than the full amount of the Debenture subscribed for
  under this Subscription Agreement. If this Subscription Agreement is rejected
  in whole, any certified cheque(s) or bank draft(s) delivered by the Subscriber
  to the Corporation on account of the subscription price for the Debenture subscribed
  for will be promptly returned to the Subscriber without interest. If this Subscription
  Agreement is accepted only in part, a cheque representing the amount by which
  the payment delivered by the Subscriber to the Corporation exceeds the subscription
  price of the Debenture sold to the Subscriber pursuant to a partial acceptance
  of this Subscription Agreement, will be promptly delivered to the Subscriber
  without interest.

	8. 	CLOSING


The Subscriber agrees to deliver to the Corporation, not later
than 4:00 p.m. (Florida time) on the date that is two (2) business days prior to
the Closing Date: (a) this duly completed and executed Subscription Agreement
(including the Representation Letter and the Form 4C, if applicable); and (b) a
certified cheque or bank draft payable to the Corporation for the aggregate
amount proposed to be invested in a Debenture by the Subscriber or payment of
the same amount in such other manner as is acceptable to the Corporation.

The sale of the Debentures will be completed at the offices of
  the Corporation, in Sarasota Florida, at 2:00 p.m. (Florida time), or such other
  time as the Corporation may determine on the Closing Date.

	9. 	FACSIMILE SUBSCRIPTIONS


The Corporation shall be entitled to rely on delivery by
facsimile of an executed copy of this Subscription, and acceptance by the
Corporation of such facsimile copy shall be equally effective to create a valid
and binding agreement between the Subscriber and the Corporation in accordance
with the terms hereof. 




- 11 -



	10. 	ASSIGNMENT


This Subscription is not assignable or transferable by either
  of the parties hereto without the expressed written consent of the other party
  hereto.

	11. 	GOVERNING LAW


The contract arising out of acceptance of this Subscription by
  the Corporation shall be governed by and construed in accordance with the laws
  of the Province of Alberta and the laws of Canada applicable therein.

	12. 	MISCELLANEOUS


Time shall be of the essence of this Subscription Agreement.
  This Subscription Agreement represents the entire agreement of the parties hereto
  relating to the subject matter hereof and there are no representations, covenants
  or other agreements relating to the subject matter hereof except as stated or
  referred to herein. The invalidity, illegality or unenforceability of any provision
  of this Subscription Agreement shall not affect the validity, legality or enforceability
  of any other provision hereof. The covenants, representations and warranties
  contained in this Subscription Agreement shall survive the closing of the transactions
  contemplated hereby and shall be binding upon and enure to the benefit of the
  parties hereto and their respective heirs, executors, administrators, successors
  and permitted assigns. The headings used in this Subscription Agreement have
  been inserted for convenience of reference only and shall not affect the meaning
  or interpretation of this Subscription Agreement or any provision hereof. Except
  as otherwise provided herein, this Subscription Agreement may only be amended
  by the parties hereto in writing.

	13. 	RISK


THE SUBSCRIBER FURTHER ACKNOWLEDGES THAT AN INVESTMENT IN
  THE DEBENTURE AND THE UNDERLYING SECURITIES IS SUBJECT TO A NUMBER OF RISK FACTORS.
  RESALE OF SUCH SECURITIES MAY REQUIRE THE AVAILABILITY OF EXEMPTIONS FROM THE
  PROSPECTUS REQUIREMENTS OF APPLICABLE SECURITIES LEGISLATION OR SIMILAR REGULATORY
  AUTHORITY PERMITTING THE TRADE. THE SUBSCRIBER COVENANTS AND AGREES TO COMPLY
  WITH THE SECURITIES ACT (ONTARIO) AND ANY OTHER RELEVANT
  SECURITIES LEGISLATION, ORDERS OR POLICIES CONCERNING THE PURCHASE, HOLDING
  OF, AND RESALE OF SUCH DEBENTURE AND THE UNDERLYING SECURITIES.




A-1

SCHEDULE"A" 

REPRESENTATION LETTER

TO:               
CARBIZ INC. (the "Corporation")

AND TO:      INNOVATION CAPITAL,
LLC (the “Agent”)

In connection with the purchase of a Debenture of the
Corporation by the undersigned subscriber, the undersigned hereby represents,
warrants, covenants and certifies to the Corporation and acknowledges that the
Corporation, the Agent and their counsel are relying thereon that:

 (a)         
it is purchasing the Debenture for its own account, for investment purposes only
and not with a view to resale or distribution and, in particular, it has no
intention to distribute either directly or indirectly any of the Underlying
Securities in the United States; provided, however, that the Subscriber may sell
or otherwise dispose of any of such securities pursuant to registration thereof
pursuant to the 1933 Act and any applicable state securities laws or under an
exemption from such registration requirements;

(b)          it
satisfies one or more of the categories of "accredited investor" (as such term
is defined in Rule 501(a) of Regulation D under the 1933 Act) indicated below
(PLEASE INITIAL ALL APPROPRIATE LINES) (an "Accredited Investor"):

	   	________	Category 1.   	A bank, as defined
        in Section 3(a)(2) of the 1933 Act, whether acting in its individual or
        fiduciary capacity; or 


	     	________	Category 2.     	A savings and loan
        association or other institution as defined in Section 3(a)(5)(A) of the
        1933 Act, whether acting in its individual or fiduciary capacity; or 



	   	________	Category 3.   	A broker or dealer
        registered pursuant to Section 15 of the United States Securities Exchange
        Act of 1934; or 


	 	________	Category 4. 	An insurance company as defined
        in Section 2(13) of the 1933 Act; or 

	   	________	Category 5.   	An investment company
        registered under the United States Investment Company Act of 1940; or
      


	   	________	Category 6.   	A business development
        company as defined in Section 2(a)(48) of the United States Investment
        Company Act of 1940; or 


	     	________	Category 7.     	A small business
        investment company licensed by the U.S. Small Business Administration
        under Section 301 (c) or (d) of the United States Small Business Investment
        Act of 1958; or 



	       	________	Category 8.       	A plan established
        and maintained by a state, its political subdivisions or any agency or
        instrumentality of a state or its political subdivisions, for the benefit
        of its employees, with total assets in excess of US$5,000,000; or 




	             
       	________	Category 9.        
            	An employee benefit
        plan within the meaning of the United States Employee Retirement Income
        Security Act of 1974 in which the investment decision is made by a plan
        fiduciary, as defined in Section 3(21) of such Act, which is either a
        bank, savings and loan association, insurance company or registered investment
        adviser, or an employee benefit plan with total assets in excess of US$5,000,000
        or, if a self- directed plan, with investment decisions made solely by
        persons who are accredited investors; or 








	   	________	Category 10.   	A private business
        development company as defined in Section 202(a)(22) of the United States
        Investment Advisers Act of 1940; or 


	         	________	Category 11.        
    	An organization
        described in Section 501(c)(3) of the United States Internal Revenue Code,
        a corporation, a Massachusetts or similar business trust, or a partnership,
        not formed for the specific purpose of acquiring the securities offered,
        with total assets in excess of US$5,000,000; or 












A-2

	 	________	Category 12.     	Any director, executive
        officer, or general partner of the issuer of the securities being offered
        or sold, or any director, executive officer, or general partner of a general
        partner of that issuer; or 



	 	________	Category 13.   	A natural person
        whose individual net worth, or joint net worth with that person's spouse,
        at the date hereof exceeds US$1,000,000; or 


	 	________	Category 14.        
    	A natural person
        who had an individual income in excess of US$200,000 in each of the two
        most recent years or joint income with that person's spouse in excess
        of US$300,000 in each of those years and has a reasonable expectation
        of reaching the same income level in the current year; or 





	 	________	Category 15.       	A trust, with total
        assets in excess of US$5,000,000, not formed for the specific purpose
        of acquiring the securities offered, whose purchase is directed by a sophisticated
        person as described in Rule 506(b)(2)(ii) under the 1933 Act; or 




	 	________	Category 16.   	Any entity in which
        all of the equity owners meet the requirements of at least one of the
        above categories; 




(c)          it
agrees that if it decides to offer, sell, pledge or otherwise transfer the
Debenture or any of the Underlying Securities, it will not offer, sell, pledge
or otherwise transfer any of such securities, directly or indirectly,
except;

	 	(i) 	to the Corporation; or 

	 	 	 
	 	(ii) 	outside the United States in compliance with the
        requirements of Regulation S under the 1933 Act and in compliance with
        applicable local laws and regulations; or 

	 	 	 
	 	(iii) 	in compliance with an exemption from registration
        under the 1933 Act provided by Rule 144 or Rule 144A thereunder, if available,
        and in accordance with any applicable state securities or "Blue Sky" laws;
        or 

	 	 	 
	 	(iv) 	in a transaction that does not require registration
        under the 1933 Act or any applicable state securities laws; 



and, in the case of subparagraph (iii) or (iv), it has furnished
  to the Corporation an opinion of counsel of recognized standing in form and
  substance satisfactory to the Corporation to such effect; 

(d)          it
  understands and acknowledges that the Debenture and the Underlying Securities
  are "restricted securities" as defined in Rule 144 under the 1933 Act, and upon
  the original issuance of the Debenture and the Underlying Securities, and until
  such time as it is no longer required under applicable requirements of the 1933
  Act or applicable state securities laws, all certificates representing the Debenture
  and the Underlying Securities and all certificates issued in exchange therefore
  or in substitution thereof, shall bear the following legend:


  "THE SECURITIES REPRESENTED HEREBY [AND THE SECURITIES ISSUED
    UPON EXERCISE HEREOF] HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES
    ACT OF 1933, AS AMENDED (THE "U.S. SECURITIES ACT"). THE HOLDER HEREOF, BY
    PURCHASING SUCH SECURITIES, AGREES FOR THE BENEFIT OF THE CORPORATION THAT
    SUCH SECURITIES MAY BE OFFERED, SOLD OR OTHERWISE TRANSFERRED ONLY (A) TO
    THE CORPORATION, (B) OUTSIDE THE UNITED STATES IN COMPLIANCE WITH REGULATION
    S UNDER THE U.S. SECURITIES ACT, (C) IN COMPLIANCE WITH THE EXEMPTION FROM
    REGISTRATION UNDER THE U.S. SECURITIES ACT PROVIDED BY RULE 144 OR RULE 144A
    THEREUNDER, IF AVAILABLE, AND IN COMPLIANCE WITH ANY APPLICABLE STATE 






A-3


  SECURITIES OR "BLUE SKY" LAWS, OR (D) IN A TRANSACTION THAT
    DOES NOT REQUIRE REGISTRATION UNDER THE U.S. SECURITIES ACT OR ANY APPLICABLE
    STATE SECURITIES LAWS, AND, IN THE CASE OF SUBPARAGRAPH (C) OR (D), THE SELLER
    FURNISHES TO THE CORPORATION AN OPINION OF COUNSEL OF RECOGNIZED STANDING
    IN FORM AND SUBSTANCE SATISFACTORY TO THE CORPORATION TO SUCH EFFECT. HEDGING
    TRANSACTIONS INVOLVING THE SECURITIES REPRESENTED HEREBY MAY NOT BE CONDUCTED
    UNLESS IN COMPLIANCE WITH THE U.S. SECURITIES ACT. DELIVERY OF THIS CERTIFICATE
    MAY NOT CONSTITUTE "GOOD DELIVERY" IN SETTLEMENT OF TRANSACTIONS ON STOCK
    EXCHANGES IN CANADA. 



provided, that if the Debenture or the Underlying Securities
are being sold pursuant to Rule 144 of the 1933 Act, the legend may be removed
by delivery to the Corporation’s registrar and transfer agent of an opinion of
counsel of recognized standing in form and substance satisfactory to the
Corporation, to the effect that the legend is no longer required under
applicable requirements of the 1933 Act and applicable state securities laws;


(e)          it
consents to the Corporation making a notation on its records or giving
instructions to any transfer agent of the Debentures and the Underlying
Securities in order to implement the restrictions on transfer set forth and
described herein;

(f)          it
has been afforded the opportunity to ask such questions and to receive answers
from, representatives of the Corporation concerning the terms and conditions of
the offering of the Debentures;

(g)          it is
an Accredited Investor that satisfies the criteria set forth in subparagraph (b)
above and, by reason of its business and financial experience and the business
and financial experience of those persons retained to advise the Subscriber with
respect to the investment in the Debenture and the Underlying Securities, the
Subscriber, together with such advisors, has such knowledge, sophistication and
experience in business and financial matters that the Subscriber is capable of
evaluating the merits and risks of the prospective investment;

(h)          it
understands and acknowledges that the Warrants may not be exercised unless an
exemption is available from the registration requirements of the 1933 Act and
the securities laws of all applicable states and the holder has furnished an
opinion of counsel of recognized standing in form and substance satisfactory to
the Corporation to such effect; provided that an Accredited Investor, that
purchased a Debenture in the United States will not be required to deliver an
opinion of counsel in connection with the exercise of Warrants that are issued
upon conversion of such Debenture;

(i)          it
acknowledges that any person who exercises a Warrant will be required to provide
to the Corporation either:

	 	(a) 	a written certification that the holder (i) acquired
        the Warrant directly from the Corporation pursuant to a written subscription
        agreement for the purchase of a Debenture; (ii) is exercising the Warrant,
        as applicable, solely for its own account and not on behalf of any other
        person; and (iii) was an Accredited Investor, both on the date the Debenture
        was acquired from the Corporation and on the date of exercise of the Warrant;
        or 

	 	 	 
	 	(b) 	a written opinion of counsel of recognized standing
        in form and substance satisfactory to the Corporation to the effect that
        an exemption from the registration requirements of the 1933 Act and applicable
        state securities laws is available for the issuance of the Warrant Shares.
      








A-4

The Subscriber understands that the certificates representing
the Warrant Shares will bear a legend restricting transfer without registration
under the 1933 Act and applicable state securities laws unless an exemption from
registration is available;

(j)          the
office or other address of the Subscriber at which the Subscriber received and
accepted the offer to purchase the Debenture is the address listed as the
"Subscriber’s Address" on the signature page of the Subscription Agreement;

(k)          it
acknowledges that it has not purchased the Debenture as a result of any form of
“general solicitation” or “general advertising” (as such terms are defined in
Regulation D of the 1933 Act);

(l)          it
understands and agrees that there may be material tax consequences to the
Subscriber of an acquisition, disposition or exercise of the Debenture; the
Corporation gives no opinion and makes no representation with respect to the tax
consequences to the Subscriber under United States, state, local or foreign tax
law of the undersigned’s acquisition or disposition of such Debenture; in
particular, no determination has been made whether the Corporation will be a
"passive foreign investment company" ("PFIC") within the meaning of Section 1291
of the United States Internal Revenue Code;

(m)          it
understands and agrees that the financial statements of the Corporation have
been prepared in accordance with Canadian generally accepted accounting
principles, which differ in some respects from United States generally accepted
accounting principles, and thus may not be comparable to financial statements of
United States companies; and

(n)          it is
acquiring the Debenture for its own account and not on behalf of any other
person for investment purposes only and not with a view to any resale,
distribution or other disposition of the Debenture or the Underlying Securities
in violation of the United States federal and state securities laws.

The foregoing representations, warranties and covenants are
made by the undersigned with the intent that they be relied upon in determining
its suitability as a purchaser of a Debenture. The undersigned undertake to
notify the Corporation immediately of any change in any statement set forth
herein which takes place prior to the Closing Date. Terms used and not defined
in this Schedule are as defined in the Subscription Agreement to which this
Schedule is attached.

Dated
at_________________________________on _____________________________________.

	 	 
	 	(Name
      of Purchaser - please print) 
	 	 
	 	 
	 	(Authorized Signature) 
	 	 
	 	 
	 	(Official Capacity - please print) 
	 	 
	 	 
	 	(please print name of individual whose
      signature 
	 	appears above) 






B-1

	 	SCHEDULE “B”

      FORM 4C

	


CORPORATE PLACEE REGISTRATION FORM

Where subscribers to a Private Placement are not individuals,
the following information about the placee must be provided. This Form will
remain on file with the Exchange. The corporation, trust, portfolio manager or
other entity (the “Placee”) need only file it on one time basis, and it will be
referenced for all subsequent Private Placements in which it participates. If
any of the information provided in this Form changes, the Placee must notify the
Exchange prior to participating in further placements with Exchange listed
companies. If as a result of the Private Placement, the Placee becomes an
Insider of the Issuer, Insiders of the Placee are reminded that they must file a
Personal Information Form (2A) or, if applicable, Declarations, with the
Exchange. 

	1. 	Placee Information: 
	  	1.1 	Name: ____________________________________________________________________________________

	 	 	 
	  	1.2 	Complete
        Address: __________________________________________________________________________

	 	 	 
	 	 	_________________________________________________________________________________________

	  	  	  
	  	1.3 	Jurisdiction of Incorporation
      or Creation: __________________________________________________________
	 	 	

	2. 	(a) 	Is the Placee purchasing
      securities as a portfolio manager (Yes/No)? _____________________________________
	  	  	 

	  	(b) 	Is the Placee carrying
      on business as a portfolio manager outside of Canada (Yes/No)? _______________________
	 	 	 
	3. 	If the answer
      to 2(b) above was “Yes”, the undersigned certifies that: 
	 	 	 
	        	3.1       	It
        is purchasing securities of an Issuer on behalf of managed accounts for
        which it is making the investment decision to purchase the securities
        and has full discretion to purchase or sell securities for such accounts
        without requiring the client’s express consent to a transaction;
      

	 	 	 
	        	3.2       	it
        carries on the business of managing the investment portfolios of clients
        through discretionary authority granted by those clients (a “portfolio
        manager” business) in _______________________________ [jurisdiction],
        and it is permitted by law to carry on a portfolio manager business in
        that jurisdiction; 

	 	 	 
	    	3.3   	it
        was not created solely or primarily for the purpose of purchasing securities
        of the Issuer; 

	 	 	 
	    	3.4   	the total asset value of the investment
        portfolios it manages on behalf of clients is not less than $20,000,000;
        and 

	 	 	 
	    	3.5   	it has no reasonable grounds to believe,
        that any of the directors, senior officers and other insiders of the Issuer,
        and the persons that carry on investor relations activities for the 








B-2

		Issuer has a beneficial interest in any of the managed
        accounts for which it is purchasing 

	 	 
	4. 	If the answer to 2(a). above was “No”,
        please provide the names and addresses of control persons of the Placee:
      






	Name 	City 	Province or 
State
    	Country 
	  	 
    	  	 
    
	 	 	 	 
	 	 	 	 



The undersigned acknowledges that it is bound by the provisions
of applicable Securities Law, including provisions concerning the filing of
insider reports and reports of acquisitions (See for example, sections 87 and
111 of the Securities Act (British Columbia) and sections 176 and 182 of
the Securities Act (Alberta).

Acknowledgement - Personal Information

“Personal Information” means any information about an
identifiable individual, and includes information contained in sections 1, 2 and
4, as applicable, of this Form. The undersigned hereby acknowledges and agrees
that it has obtained the express written consent of each individual to:

	(a) 	the disclosure of Personal Information by the undersigned
        to the Exchange (as defined in Appendix 6B) pursuant to this Form; and
      

	 	 
	(b) 	the collection, use and disclosure of Personal Information
        by the Exchange for the purposes described in Appendix 6B or as otherwise
        identified by the Exchange, from time to time. 



Dated
at_________________________________on _____________________________________.

	 	 
	(Name of Purchaser
      - please print) 	 
	 	 
	 	 
	(Authorized
      Signature) 	 
	 	 
	 	 
	(Official Capacity
      - please print) 	 
	 	 
	 	 
	(please print name of individual whose signature appears
      above) 	 


THIS IS NOT A PUBLIC DOCUMENT