Document:

Filed by Automated Filing Services Inc. (604) 609-0244 -  Carbiz, Inc. - Exhibit 10.1

ASSET PURCHASE AGREEMENT 

by and among 

CARBIZ AUTO CREDIT AQ, INC., 

JOHN R. CALCOTT

ASTRA FINANCIAL SERVICES, INC. 

and 

CALCARS AB, INC.

 

Dated as of October 1, 2007

ASSET PURCHASE AGREEMENT

     THIS ASSET PURCHASE AGREEMENT
(this “Agreement”), dated as of October 1, 2007, is by and among
Carbiz Auto Credit AQ, Inc. (the “Purchaser”), Astra Financial
Services, Inc. and Calcars AB, Inc. (together, the “Sellers”) and
John R. Calcott (“Calcott” or the “Shareholder”)
[together with the Sellers, the “Seller Group”].

RECITALS

     A. Sellers operate Buy-Here
Pay-Here automobile dealerships at numerous locations throughout the Midwest
(together, the “Business”);

     B. The Purchaser desires to
purchase from Sellers, and Sellers desire to sell to the Purchaser, all of their
right, title and interest in and to the Purchased Assets (as defined below);
and

     C. Sellers desire to transfer to
the Purchaser, and the Purchaser desires to accept and assume from Sellers, the
Assumed Liabilities (as defined below).

     NOW, THEREFORE, in consideration
of the mutual promises and representations and subject to the terms and
conditions herein contained, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:

ARTICLE 1: DEFINITIONS

     “Accounts
Receivable” has the meaning set forth in Section
2.1(b).

     “Accrued
Expenses” shall mean all accrued expenses for bona fide third party
expenses of Sellers, as “accrued expenses” are further defined by GAAP, incurred
in the Ordinary Course of Business by Sellers, outstanding as of the Closing
Date, and reflected in the Sellers’ Financial Statements or Interim Financial
Statements.

     “Affiliate” of any
Person means any person directly or indirectly controlling, controlled by, or
under common control with, any such Person and any officer, director or
controlling person of such Person.

     “Agreement” has
the meaning set forth in the preamble to this Agreement.

     “Ancillary
Agreements” means the Bill of Sale, the Noncompetition Agreements, the
Assumption Agreement and each agreement, document, instrument or certificate
contemplated by this Agreement or to be executed by the Purchaser or any member
of the Seller Group in connection with the consummation of the transactions
contemplated by this Agreement, in each case only as applicable to the relevant
party or parties to such Ancillary Agreement, as indicated by the context in
which such term is used.

     “Assumed
Contracts” has the meaning set forth in Section
2.1(d).

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     “Assumed
Liabilities” has the meaning set forth in Section 3.1.

     “Assumption
Agreement” has the meaning set forth in Section
5.3(a).

     “Basket” has
the meaning set forth in Section 11.4.

     “Borrower”
has the meaning set forth in the Seller Group Loan and Security Agreement.

     “Business” has
the meaning set forth in the recitals to this Agreement.

     “Calcott” has
the meaning set forth in the preamble to this Agreement.

     “Calcott Noncompetition
Agreement” has the meaning set forth in Section
5.2(i).

     “Cap” has the
meaning set forth in Section 11.4.

     “Claims Notice”
has the meaning set forth in Section 11.2(a).

     “Closing” has
the meaning set forth in Section 5.1.

     “Closing Date”
has the meaning set forth in Section 5.1.

     “Closing
Payment” has the meaning set forth in Section 4.1.

     “Code” means
the Internal Revenue Code of 1986, as amended.

     “Contracts” has
the meaning set forth in Section 6.15.

     “Copyright” means
all copyrights, copyrightable works, mask work rights, rights in databases, data
collections, copyright registrations and applications for copyright registration
and equivalents and counterparts of the foregoing.

      “Debtor” has the
meaning set forth in the Seller Group Loan and Security Agreement. 

     “Domain Names”
means all Internet electronic addresses, uniform resource locators and
alphanumeric designations associated therewith and all registrations for any of
the foregoing.

     “Due Diligence
Investigation” has the meaning set forth in Section
9.2(a).

     “Due Diligence
Period” has the meaning set forth in Section 9.2(a).

     “Environment” means
soil, surface waters, groundwater, land, stream sediments, surface or subsurface
strata, ambient air, indoor air or indoor air quality, including, without
limitation, any material or substance used in the physical structure of any
building or improvement and any environmental medium.

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     “Environmental
Condition” means any condition of the Environment with respect to the
Real Property, with respect to any property previously owned, leased or operated
by Sellers to the extent such condition of the Environment existed at the time
of such ownership, lease or operation, or with respect to any other real
property at which any Hazardous Material generated by the operation of the
business of Sellers prior to the Closing Date has been treated, stored or
disposed of, which violates any Environmental Law, or even though not violative
of any Environmental Law, nevertheless results, or could possibly result, in any
Release, or Threat of Release, damage, loss, cost, expense, claim, demand, order
or liability.

     “Environmental
Damages” means all claims, judgments, damages, losses, penalties, fines,
liabilities (including strict liability), encumbrances, liens, costs and
expenses of investigation and defense of any claim, whether or not such claim is
ultimately defeated, and of any good faith settlement of judgment, of whatever
kind or nature, contingent or otherwise, matured or unmatured, foreseeable or
unforeseeable, including without limitation reasonable attorneys’ fees and
disbursements and consultants’ fees, any of which are incurred at any time as a
result of the existence prior to the Closing Date of Hazardous Material upon,
about, beneath the Real Property or migrating or threatening to migrate to or
from the Real Property, or the existence of a violation of Environmental Laws
pertaining to the Real Property.

     “Environmental Law”
means any Law directly regulating the Environment or activities with respect to
the Environment, or implementing or otherwise dealing with the subject matter
thereof.

     “ERISA” means the
Employee Retirement Income Security Act of 1974, as amended.

     “Excluded
Representations” has the meaning set forth in Section
11.3.

     “Expiration
Date” has the meaning set forth in Section
11.3.

     “Family Affiliate”
means any child, stepchild, grandchild, parent, stepparent, grandparent, spouse,
sibling, mother-in-law, father-in-law, son-in-law, daughter-in-law,
brother-in-law or sister-in-law, including adoptive relationships, of the
Shareholder.

     “Financial
Statements” has the meaning set forth in Section
6.18(a).

     “GAAP” means
generally accepted accounting principles.

     “General Enforceability
Exceptions” has the meaning set forth in Section 6.3.

     “Governmental
Authority” means any government, political subdivision or regulatory
body, whether federal, state, local or foreign, or any agency or instrumentality
of any such government or political subdivision or regulatory authority, or any
federal, state, local or foreign court or arbitrator.

     “Guarantor” has the
meaning set forth in the Seller Group Loan and Security Agreement.

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     “Hazardous
Material” means any pollutant, toxic substance, including asbestos and
asbestos-containing materials, hazardous waste, hazardous material, hazardous
substance, contaminant, radiation and radioactive materials, leaded paints,
toxic mold and other harmful biological agents, and polychlorinated biphenyls as
defined in, the subject of, or would give rise to, liability under any
Environmental Law.

     “Indebtedness” of
any Person means: either (a) any liability of any Person (i) for borrowed money
(including the current portion thereof), or (ii) under any reimbursement
obligation relating to a letter of credit, bankers’ acceptance or note purchase
facility, or (iii) evidenced by a bond, note, debenture or similar instrument
(including a purchase money obligation), or (iv) for the payment of money
relating to leases that are required to be classified as a capitalized lease
obligation in accordance with GAAP, or (v) for all or any part of the deferred
purchase price of property or services (other than trade payables), including
any “earnout” or similar payments or non-compete payments, or (vi) under
interest rate swap, hedging or similar agreements, or (b) any liability of
others described in the preceding clause (a) that such Person has guaranteed,
that is recourse to such Person or any of its assets or that is otherwise its
legal liability or that is secured in whole or in part by the assets of such
Person. For purposes of this Agreement, Indebtedness shall include (A) any and
all accrued interest, success fees, prepayment premiums, make-whole premiums or
penalties, and fees or expenses actually incurred (including attorneys’ fees)
associated with the prepayment of any Indebtedness, (B) any and all amounts owed
by the Sellers to any Affiliate of Sellers including, without limitation, the
Shareholder and (C) any and all bonuses or incentive payments owed by the
Sellers to any of their employees.

     “Indemnified
Party” has the meaning set forth in Section 11.2(a).

     “Indemnifying
Party” has the meaning set forth in Section 11.2(a).

     “Intellectual
Property” means Copyrights, Domain Names, Patents, Software, Trademarks
and Trade Secrets.

     “Interim Financial
Statements” has the meaning set forth in Section
6.18(a).

     “IRS” means the
Internal Revenue Service.

     “Jurisdictions”
has the meaning set forth in Section 6.8.

     “Knowledge” means
the actual knowledge of the Shareholder, or knowledge obtained or obtainable in
the exercise of reasonable diligence in the normal course of business or conduct
of duties.

     “Law” means any
law, statute, code, ordinance, regulation or other requirement of any
Governmental Authority.

     “Leased Real
Property” has the meaning set forth in Section 6.6(b).

     “Lenders” has
the meaning set forth in Section 4.1.

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     “Liability
Claim” has the meaning set forth in Section 11.2(a).

     “Lien” means any
mortgage, lien, pledge, encumbrance, security interest, claim, charge, defect in
title or other restriction.

     “Litigation
Conditions” has the meaning set forth in Section
11.2(b).

     “Losses” has
the meaning set forth in Section 11.1.

     “Material Adverse
Change” means any change, event, violation, inaccuracy, circumstance, or
effect that is, or could reasonably be expected to be, materially adverse to the
business, assets (including intangible assets), liabilities, financial
condition, results of operations or business prospects of the Sellers taken as a
whole or on the ability of the Seller Group to consummate timely the
transactions contemplated herein, provided, however, that the deterioration in
the business of the Sellers that they are currently experiencing will not be
considered a material change.

     “Noncompetition
Agreements” means the Sellers’ Noncompetition Agreement, Calcott
Noncompetition Agreement, and Wike Noncompetition Agreement.

     “Order” means any
order, judgment, injunction, award, decree, ruling, charge or writ of any
Governmental Authority.

     “Ordinary Course of
Business” shall mean the ordinary course of business consistent with
past custom and practice (including with respect to quantity and frequency).

     “Patents” means all
patents, industrial and utility models, industrial designs, certificates of
invention and other indicia of invention ownership issued or granted by any
Governmental Authority, and all applications, provisionals, reissues,
re-examinations, extensions, divisions, continuations (in whole or in part) and
equivalents and counterparts of the foregoing.

     “Permit” means any
environmental permit, license, approval, consent, or authorization issued by a
Governmental Authority.

     “Permitted
Exceptions” has the meaning set forth in Section
6.6(a).

     “Person” means any
individual, sole proprietorship, partnership, corporation, limited liability
company, unincorporated society or association, trust, or other entity.

     “Pre-Closing Tax
Period” has the meaning set forth in Section 6.22.

     “Prepaid
Expenses” has the meaning set forth in Section 2.1(a).

     “Purchase
Price” means the Closing Payment and the Assumed Liabilities.

     “Purchased
Assets” has the meaning set forth in Section 2.1.

     “Purchaser” has
the meaning set forth in the preamble to this Agreement.

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     “Purchaser’s
Business” has the meaning set forth in Section
13.1(a).

     “Real
Property” means: (i) the Leased Real Property; and (ii) the
interests of Sellers’ Affiliates in the real property that is the subject of
those leases set forth on Schedule
9.1(d).

     “Real Property
Leases” has the meaning set forth in Section 6.6(b).

     “Related
Party” has the meaning set forth in the Seller Group Loan and
Security Agreement.

     “Release” means any
releasing, spilling, leaking, pumping, pouring, emitting, emptying, discharging,
injecting, escaping, leaching, disposing, or dumping of a Hazardous Material
into the Environment (including, without limitation, the abandonment or
discarding of barrels, containers and other closed receptacles containing any
Hazardous Materials) and any condition that results in the exposure of a Person
to a Hazardous Material.

     “Retained
Assets” has the meaning set forth in Section 2.2.

     “Retained
Liabilities” has the meaning set forth in Section 3.2.

     “Returns” has
the meaning set forth in Section 6.22.

     “Sellers” has
the meaning set forth in the preamble to this Agreement.

     “Sellers’ Confidential
Information” has the meaning set forth in Section
13.1(a).

     “Seller Group”
has the meaning set forth in the preamble to this Agreement.

     “Seller Group Counsel’s
Opinion” has the meaning set forth in Section 5.2(k).

     “Seller Group Loan and
Security Agreement” means the Loan and Security Agreement dated April
11, 2006, by and among The Calcott Companies, Inc., Astra Financial Services,
Inc., Cal Cars, Inc., Cal Cars AB, Inc., Cal Cars of Champaign, Inc., Cal Cars
of East Peoria, Inc., Cal Cars of Iowa, Inc., Calcars Used Auto Sales of
Oklahoma, Inc. and Cal Cars of Indiana, Inc., as Borrowers, and John R. Calcott,
Midwest Real Estate Management, Ltd., Midwest Real Estate Management Limited
Partnership, and West Locust Davenport, L.L.C. as Guarantors, Lancelot Investors
Fund, L.P., as Initial Investor, the other Lenders from time to time party
thereto, and AGM, LLC, as Administrative Agent, all as amended from time to
time.

     “Sellers Noncompetition
Agreement” has the meaning set forth in Section
5.2(h).

     “Shareholder”
has the meaning set forth in the preamble to this Agreement. 

     “Software” means
all computer software and code, including assemblers, applets, compilers, source
code, object code, development tools, design tools, user interfaces and data, in
any form or format, however fixed.

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     “Tangible Personal
Property” has the meaning set forth in Section 6.6(c).

     “Tax” means (a) any
net income, alternative or add-on minimum tax, gross income, gross receipts,
sales, use, ad valorem, value added, transfer, franchise, profits, license,
withholding on amounts paid to or by the Sellers, payroll, employment, excise,
severance, stamp, occupation, premium, property, environmental or windfall
profit tax, custom, duty or other tax, governmental fee or other like assessment
or charge of any kind whatsoever, together with any interest, penalty, addition
to tax or additional amount imposed by any Taxing Authority, whether disputed or
not, (b) any liability of the Sellers for the payment of any amounts of any of
the foregoing types as a result of being a member of an affiliated,
consolidated, combined or unitary group, or being a party to any agreement or
arrangement whereby liability of the Sellers for payment of such amounts was
determined or taken into account with reference to the liability of any other
entity and (c) any liability of the Sellers for the payment of any amounts as a
result of being a party to any Tax sharing agreements or arrangements (whether
or not written) binding on the Sellers or with respect to the payment of any
amounts of any of the foregoing types as a result of any express or implied
obligation to indemnify any other Person.

     “Tax Authority”
has the meaning set forth in Section 6.22.

     “Threat of Release”
means a substantial likelihood of a Release that requires action to prevent or
mitigate damage to the Environment that might result from such Release.

     “Trade
Payables” means bona fide trade payables of Sellers evidenced by
invoices, including, without limitation, payables relating to office supplies,
building supplies and construction supplies.

     “Trade Secrets”
means all inventions, discoveries, ideas, processes, designs, models, formulae,
patterns, compilations, programs, devices, methods, techniques, processes,
know-how, proprietary information, customer lists, software code, technical
information, data and databases, drawings and blueprints, and all other
information and materials that would constitute a trade secret under applicable
law.

     “Trademarks” means
all trademarks, trade names, fictitious business names, service marks,
certification marks, collective marks and other proprietary rights to words,
names, slogans, symbols, logos, devices, sounds, other things or combination
thereof used to identify, distinguish and indicate the source or origin of goods
or services, and all registrations, renewals and applications for registration,
equivalents and counterparts of the foregoing, and the goodwill of Sellers
associated with each of the foregoing.

     “Vehicle
Liabilities” has the meaning set forth in Section
3.1(b).

     “Wike”
means Karen Wike.

     “Wike Noncompetition
Agreement” has the meaning set forth in Section
5.2(j).

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ARTICLE 2: PURCHASE AND SALE OF ASSETS

     2.1 Assets to be
Transferred. At the Closing, the Purchaser shall purchase from
the Sellers, and the Sellers shall sell, transfer, assign, convey and deliver to
the Purchaser, all of the Sellers’ right, title and interest in and to all
assets, rights and properties of every nature, kind and description, whether
owned, leased or licensed, whether tangible or intangible, and whether real,
personal or mixed (collectively, the “Purchased Assets”),
excluding only the Retained Assets, but including, without limitation, the
following:

     (a) All
prepaid expenses, advance payments and other similar deposits, including without
limitation, deposits with suppliers and utilities and security deposits made
under any Real Property Lease that is an Assumed Contract (“Prepaid
Expenses”), but excluding prepaid taxes and prepaid insurance;

     (b) All
accounts receivable and other claims for money due to the Sellers, excluding
only (i) accounts receivable with Affiliates and Family Affiliates; (ii)
intercompany receivables; (iii) other claims for money due to Sellers from
Shareholder and/or any Affiliate and/or Family Affiliate; and (iv) claims
described in Section 2.2(a) (“Accounts
Receivable”);

     (c) All
furniture, fixtures, machinery and equipment, including, without limitation,
office equipment, supplies and other tangible property;

     (d) All
contracts and agreements to which Sellers are a party or by which Sellers’
assets or properties are bound and which are specifically identified on
Schedule 2.1(d) and all rights under the Contracts with customers
for the purchase of motor vehicles, including, but not limited to rights with
respect to the vehicle substitution program, including but not limited to the
claim processing fee and insurance proceeds payable under such program
(collectively, the “Assumed Contracts”);

     (e) All
Intellectual Property other than (i) rights set forth in the contract of the
Sellers with Autostar, except as set forth in Section 10.5; and
(ii) Intellectual Property specifically listed as being a Retained Asset;

     (f) All
of Sellers’ computer equipment and hardware, including without limitation all
central processing units, terminals, disk drives, tape drives, electronic memory
units, printers, keyboards, screens, peripherals (and other input/output
devices), modems, hand held computers, laptop computers and notebook computers,
and any and all parts and appurtenances thereto, used primarily in connection
with the Business, except as set forth on Schedule 2.2(f);

     (g) All
of Sellers’ right, title and interest in and to all landline telephone numbers
(local and toll free), used by Sellers in connection with the Business, with the
exception of those telephone numbers listed on Schedule
2.2(k);

     (h) All
licenses, permits, franchises, certificates of authority, certificates of
occupancy, safety, fire and health approvals, or any waiver of any of the 

8

foregoing, issued to the Sellers by any
Governmental Authority, but only to the extent transferable;

     (i)
Except for the corporate minute books and related stock records of the Sellers,
all business records of the Sellers, including, without limitation, all books,
records, ledgers, files, documents, correspondence, lists, including, without
limitation, customer lists (in whatever form or medium), plats, drawings,
photographs, creative materials, advertising and promotional materials, studies,
reports and other materials (in whatever form or medium), owned or maintained by
the Sellers, except as otherwise specifically excluded in Section
2.2; 

     (j) All
rights, claims, and causes of action of Sellers under or pursuant to all
warranties, representations, indemnifications, hold harmless provisions, and
guarantees made by suppliers, licensors, manufacturers, contractors, and others
(including Sellers’ predecessors in title to the Purchased Assets) in respect of
the Business or Purchased Assets, but excluding rights, claims and causes of
action that relate to any Retained Assets; and

     (k)
Sellers’ inventory of motor vehicles (i) sold to customers but not yet paid for;
and/or (ii) held as a result of repossession.

     2.2 Retained
Assets. Notwithstanding anything in this Agreement to the
contrary, the Sellers will retain the following assets, rights and properties
(collectively, the “Retained Assets”), and the Purchaser will in
no way be construed to have purchased or acquired (or to be obligated to
purchase or to acquire) any interest whatsoever in any of the Retained
Assets:

     (a)
Except as set forth in Section 2.1(j), all rights, claims, and
causes of action of Sellers against third parties (including Sellers’
predecessors in title to the Purchased Assets), including without limitation
insurance claims [except as set forth in Section 2.1(d)] and
including without limitation Sellers’ claims asserted in Astra Financial
Services, et al. v. Bridge Healthcare Finance LLC, et al., 17th
Judicial Circuit, Winnebago County, Illinois, Case No. 06 L 296;

     (b)
Sellers’ inventory of motor vehicles, except for inventory described in
Section 2.1(k);

     (c)
claims for payment of money other than (i) the Accounts Receivable, (ii) claims
under the Assumed Contracts, and (iii) as set forth in Section
2.1(j);

     (d)
Sellers’ books of account and corporate records that relate, in whole or in
part, to Seller’s corporate organization and governance matters of Seller,
including, without limitation, Seller’s articles of incorporation, bylaws,
minutes of directors, shareholders and committees, corporate minute books, and
income tax returns;

     (e)
Sellers’ names, trade names, Trademarks, servicemarks, Copyrights and Domain
Names, e-mail addresses, and websites;

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     (f)
cellular phones, digital phones, personal radios, personal data assistants,
pagers, “Palm Pilots, Blackberries and their equivalents” and other
communication controllers, and those assets specifically listed on
Schedule 2.2(f);

     (g) all
insurance policies of Sellers and any prepaid premiums for such insurance
policies; 

     (h)
all prepaid taxes of Sellers;

     (i)
all claims and causes of action relating to Retained Assets; 

     (j)
Contracts that are not Assumed Contracts; 

     (k)
Sellers’ cellular telephone numbers and those land line telephone numbers listed
on Schedule 2.2(k); 

     (l)
Sellers’ employment and personnel files, except that Sellers shall provide to
the Purchaser copies of any such employment and personnel files for which it
receives a valid authorization and release from the applicable employee; 

     (m) any
photographs, creative materials, and advertising, marketing and promotional
materials that contain or include any of Sellers’ names, servicemarks, Trade
Names, and/or Copyrights; and

     (n)
all of Sellers’ goodwill.

ARTICLE 3: LIABILITIES

     3.1 Assumed
Liabilities. At the Closing, the Purchaser shall assume and
become responsible for, and shall thereafter pay, perform and discharge as and
when due all of the liabilities of the Sellers set forth below (collectively,
the “Assumed Liabilities”):

     (a) All
liabilities and obligations of the Sellers as of the Closing Date arising under
or related to the Assumed Contracts; provided, however, the
Purchaser will not assume or be responsible for any such liabilities or
obligations to be performed on or prior to the date of the Closing or that arise
from breaches of such Assumed Contracts or defaults under such Assumed Contracts
by Sellers, all of which liabilities and obligations constitute Retained
Liabilities.

     (b) The
wholesale purchase price for motor vehicles which have been re-sold by Sellers
prior to the Closing Date but not paid for by Sellers and all sales tax, tag and
title obligations with respect thereto, subject to a cap of Three Hundred Twenty
Five Thousand and 00/100 Dollars ($325,000.00) in the aggregate for the
foregoing liabilities (together, the “Vehicle Liabilities”). The
parties acknowledge that Sellers believe that the vehicles listed on
Schedule 3.1(b) represent those vehicles to which the Purchaser’s
obligations under this Section 3.1(b) apply, and that the
Purchaser agrees to review the paperwork relating to such vehicles and determine
whether it agrees that such 

10

vehicles are subject to this
Section 3.1(b) as soon as practicable, and in no event later than
October 10, 2007. 

     3.2 Retained
Liabilities.

     (a)
Sellers shall retain all liabilities and obligations of Sellers, other than the
Assumed Liabilities, including, but not limited to obligations of Sellers to pay
Trade Payables, obligations of Sellers to pay Accrued Expenses, obligations of
Sellers under their agreement with Autostar (except as set forth in
Section 10.1), and obligations of Sellers with respect to
financing of their inventory (such retained liabilities and obligations of
Sellers are hereinafter collectively called the “Retained
Liabilities”).

     (b)
Without limiting the foregoing, other than the Assumed Liabilities specifically
identified in Section 3.1, Purchaser shall not assume or take
title to the Purchased Assets subject to, or in any way be liable or responsible
for, any liabilities or obligations of Sellers (whether or not referred to in
any Schedule or Exhibit hereto), it being expressly acknowledged that it is the
intention of the parties hereto that all liabilities and obligations that
Sellers have or may have in the future (whether accrued, absolute, contingent,
unliquidated, or otherwise, whether or not known to Sellers, and whether due or
to become due), other than the Assumed Liabilities, shall be and remain the
liabilities and obligations of Sellers.

     (c)
Without limiting the generality of the foregoing, Purchaser shall not assume or
take title to the Purchased Assets subject to, or in any way be liable or
responsible for: (a) the liabilities and obligations of Sellers payable at the
Closing from the Purchase Price for Indebtedness; (b) any liabilities and
obligations of Sellers relating to the Retained Assets described in
Section 2.2; (c) any liability or obligation of Sellers resulting
from or relating to the employment relationship between Sellers and any of
Sellers’ present or former employees engaged in connection with the ownership or
operation of the Purchased Assets or the termination of any such employment
relationship on or prior to the Closing Date, including without limitation
severance pay and other similar benefits, if any, and any claims filed on or
prior to the Closing Date or which may thereafter be filed by or on behalf of
any such present or former employee relating to the employment or termination of
employment of any such employee by Sellers on or prior to the Closing Date,
including without limitation any claim for wrongful discharge, breach of
contract, unfair labor practice, employment discrimination, unemployment
compensation, or workers’ compensation; (d) any liability or obligation of
Sellers in respect of any agreement, trust, plan, fund, or other arrangement
under which benefits or employment is provided for any of Sellers’ present or
former employees engaged in connection with the ownership or operation of the
Purchased Assets; or (e) any Tax liabilities or deficiencies, whether federal,
state, or local, in each such case to the extent applicable to periods ending on
or prior to the Closing Date.

ARTICLE 4: PURCHASE PRICE

     4.1 Purchase
Price. In consideration for the Purchased Assets, and the Seller
Group and Wike entering into the Noncompetition Agreements, (i) the Purchaser
shall pay the 

11

Assumed Liabilities when and as due after the Closing in the
Ordinary Course of Business, and (ii) the Purchaser shall pay or cause to be
paid for the benefit of the Sellers at Closing in immediately available funds an
amount sufficient to repay the Indebtedness (the “Closing
Payment”) of Sellers and the other Borrowers, Debtors, Guarantors and
Related Parties to the “Lender Parties” under the Seller Group Loan and Security
Agreement (together, the “Lenders”), which Closing Payment shall
be paid directly to the Lenders.

     4.2 Allocation of
Purchase Price. The Purchase Price shall be allocated among the
Purchased Assets in accordance with their fair market values as set forth on
Schedule 4.2 attached hereto. Each of the parties hereto shall
report the purchase and sale of the Purchased Assets in accordance with the
allocations set forth on Schedule 4.2 for all Tax purposes.

ARTICLE 5: CLOSING AND DELIVERIES

     5.1 Closing.
The closing of the transactions contemplated in this Agreement (the
“Closing”) shall take place on October 1, 2007, or such
other date as the parties hereto may mutually determine (the date that the
Closing takes place is referred to herein as the “Closing Date”).
The Closing of the transactions contemplated by this Agreement shall take place
at the offices of Lenders’ counsel at Katten Muchin Roseman LLP, 525 West Monroe
Street, Chicago, IL 60661.

     5.2 Deliveries by
the Seller Group. At the Closing, the Seller Group shall deliver
to the Purchaser the following items:

     (a)
possession of the Purchased Assets;

     (b) a
reasonably current certificate of good standing of Sellers issued by the
Secretary of State of the state of incorporation of Sellers;

     (c)
copies of resolutions of the shareholder of Sellers, acting in his capacity as
shareholder and director, approving the execution and delivery of this Agreement
and the Ancillary Agreements, and the consummation of the transactions
contemplated hereby and thereby, certified by an officer of Sellers;

     (d) a
copy of the Bill of Sale, in the form of Exhibit A attached
hereto, duly executed by the Sellers;

     (e) all
warranties of all machinery and equipment, and all guarantees from all
manufacturers and suppliers relating to any of the Purchased Assets, if any;

     (f) all
contracts, files and other data and documents relating to the Purchased
Assets;

     (g)
appropriate termination statements under the Uniform Commercial Code and other
instruments as may be requested by the Purchaser to extinguish all Indebtedness
of the Sellers and all security interests related thereto to the extent directed
by the Purchaser;

12

     (h) a
copy of a noncompetition agreement in the form of Exhibit B
attached hereto, duly executed by the Sellers (the “Sellers’
Noncompetition Agreement”);

     (i) a
copy of a noncompetition agreement, in the form of Exhibit C
attached hereto, duly executed by Calcott (the “Calcott
Noncompetition Agreement”);

     (j) a
copy of a noncompetition agreement in the form of Exhibit D
attached hereto, duly executed by Wike (the “ Wike Noncompetition
Agreement”);

     (k) an
opinion, dated as of the Closing Date, of counsel to the Seller Group, in the
form of Exhibit E attached hereto (the “Seller Group
Counsel’s Opinion”);

     (l)
copies of executed consents identified on Schedule 6.5; and

     (m) such
other documents and instruments as the Purchaser may reasonably request to
consummate the transactions contemplated hereby.

     5.3 Deliveries by
the Purchaser. At the Closing, the Purchaser shall deliver to the
Sellers the following items:

     (a) an
assumption agreement, in the form of Exhibit F attached hereto,
executed by the Purchaser (the “Assumption Agreement”);

     (b)
the Closing Payment;

     (c)
copies of resolutions of the Board of Directors of the Purchaser approving the
execution and delivery of this Agreement and the Ancillary Agreements, and the
consummation of the transactions contemplated hereby and thereby, certified by
an officer of the Purchaser; 

     (d)
the payments under new leases described in Section 9.3(d); and

     (e) such
other documents and instruments as the Sellers may reasonably request to
consummate the transactions contemplated hereby.

ARTICLE 6: REPRESENTATIONS AND WARRANTIES OF THE
SELLER GROUP

     Each member of the Seller Group,
jointly and severally, hereby represents and warrants to the Purchaser, except
as set forth in the Schedules to this Agreement, that the following
representations and warranties are true and correct, as of the date hereof, and
will be, as of the Closing Date, true and correct, except as set forth on the
Schedules attached hereto and made a part hereof. Except as specifically
provided in this Agreement, the Purchaser acknowledges that the Seller Group has
not made, and does not make, and specifically negates and disclaims, any
representations, warranties, promises, covenants, agreements or guaranties of
any kind or character whatsoever, whether express or implied, oral or written,
past, present or future:

13

     6.1 Existence and
Good Standing. Each Seller is a corporation duly incorporated,
validly existing and in good standing under the laws of the state of their
incorporation.

     6.2
Power. Sellers have the requisite corporate power and
authority to execute, deliver and perform fully their respective obligations
under this Agreement and the Ancillary Agreements.

     6.3 Validity and
Enforceability. This Agreement and each of the Ancillary
Agreements have been duly and validly executed and delivered to the Purchaser by
the Seller Group. The execution, delivery and performance of this Agreement and
each of the Ancillary Agreements, and the consummation of the transactions
contemplated hereby and thereby, have been duly and validly authorized by all
necessary action on the part of each member of the Seller Group, as applicable,
and constitute the valid and legally binding obligations of each of the members
of the Seller Group, enforceable against each member of the Seller Group in
accordance with their respective terms, except as may be limited by (a)
applicable bankruptcy, reorganization, insolvency, moratorium, liquidation,
fraudulent conveyance or other similar Laws affecting the enforcement of
creditors’ rights generally from time to time in effect and (b) the availability
of equitable remedies (regardless of whether enforceability is considered in a
proceeding at Law or in equity) (collectively, the “General Enforceability
Exceptions”).

     6.4 No
Conflict. Neither the execution of this Agreement or the
Ancillary Agreements, nor the performance by any member of the Seller Group of
his or its obligations hereunder or thereunder will (a) violate or conflict with
Sellers’ Articles of Incorporation, Bylaws or other organizational or governing
document, as applicable, or any Law or Order, (b) violate, conflict with or
result in a breach or termination of, or otherwise give any Person additional
rights or compensation under, or the right to terminate or accelerate, or
constitute (with notice or lapse of time, or both) a default under the terms of
any Assumed Contract, to which any member of the Seller Group is a party or by
which any of the Purchased Assets are bound or (c) result in the creation or
imposition of any Lien with respect to, or otherwise have an adverse effect
upon, any of the Purchased Assets. Sellers have provided Purchaser with true,
correct and complete copies of Sellers’ Articles of Incorporation and
Bylaws.

     6.5
Consents. Except as set forth on Schedule
6.5, no consent, approval or authorization of any Person, including any
Governmental Authority, is required to be made or obtained by the Sellers in
connection with the execution and delivery by any member of the Seller Group of
this Agreement or the Ancillary Agreements or the consummation of the
transactions contemplated hereby or thereby.

     6.6
Property.

     (a)
Title. Sellers will have at Closing good and marketable
title to, or valid and enforceable leasehold interests in, all of the Purchased
Assets, in each case free and clear of all Liens other than Liens for current
(but not respread) taxes, assessments, fees and other charges by Governmental
Authorities which are not due and payable (collectively, the “Permitted
Exceptions”).

14

     (b)
Real Property Leases. Schedule 6.6(b) sets forth a
true and complete description of all real property leased, licensed to or
otherwise used or occupied (but not owned) by the Sellers (collectively, the
“Leased Real Property”) including the address thereof, the annual
fixed rental, the expiration of the term, any extension options and any security
deposits. A true and correct copy of each such lease, license or occupancy
agreement, and any amendments thereto, with respect to the Leased Real Property
(collectively, the “Real Property Leases”) has been delivered to
the Purchaser, and no changes have been made to any Real Property Leases since
the date of delivery. All of the Leased Real Property is used or occupied by the
Sellers pursuant to a Real Property Lease. Each Real Property Lease is in full
force and effect and is valid, binding and enforceable in accordance with its
terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium,
liquidation, fraudulent conveyance and other similar Laws and principles of
equity affecting creditors’ rights and remedies generally. Except as set forth
on Schedule 6.6(b), there are no existing defaults by the Sellers
or, to Sellers’ Knowledge, the lessor under any of the Real Property Leases, and
no event has occurred which (with notice, lapse of time or both) could
reasonably be expected to constitute a breach or default under any of the Real
Property Leases by any party or give any party the right to terminate,
accelerate or modify any Real Property Lease. Consent is required from the
lessor under each of the Real Property Leases in order to consummate the
transactions contemplated by this Agreement and the Ancillary Agreements.

     (c)
Tangible Personal Property. Schedule 6.6(c) sets
forth a true and complete fixed asset list prepared by Sellers’ accountant and
used in preparation of the Financial Statements (the “Tangible Personal
Property”); provided, however, that, notwithstanding the foregoing, the
parties acknowledge that the fixed assets on Schedule
6.6(c) that relate to the Lafayette, Indiana location have
been sold, are no longer owned by Sellers, and are not included in the Purchased
Assets or the Tangible Personal Property.

     (d)
Absence of Violations. Except as set forth on Schedules
6.6(d) and 12(c) (with respect to OSHA complaints): 

     (i) To
Sellers’ Knowledge, none of the Real Property, nor the leasing, occupancy or use
of the Real Property, is in material violation of any Law, including, without
limitation, any building, zoning, environmental or other ordinance, code, rule
or regulation, and there are no work orders, notices of deficiency or notices of
violation issued by any Governmental Authority affecting the Real Property.

     (ii) To
Sellers’ Knowledge, the condition and use of the Real Property conforms in all
material respects to each applicable certificate of occupancy and all other
permits required to be issued in connection with the Real Property. Sellers have
obtained all permits necessary for the operation of the business of Sellers at
the Real Property, and is zoned to permit the current use of the Real
Property.

15

     (e)
Reassessments. To Sellers’ Knowledge, there is not now pending nor
contemplated any reassessment of any parcel included in the Real Property that
could result in a change in the rent, additional rent or other sums and charges
payable by Sellers under any agreement relating to the Real Property.

     (f)
No Condemnation. To Sellers’ Knowledge, there is no pending
condemnation, expropriation, eminent domain or similar proceeding affecting all
or any portion of the Real Property, other than the Real Property located in
Springfield, Ohio. Sellers have not received any written notice or oral notice
of any such proceeding, and Sellers have no Knowledge that any such proceeding
is contemplated, other than respect to the Real Property located in Springfield,
Ohio.

     (g)
Condition of Property. To Sellers’ Knowledge, there are no
material defects in, mechanical failure of, or damage to, the Real Property,
other than as set forth on Schedule 6.6(g).

     6.7 Condition of
Property. The tangible Purchased Assets are purchased by the Purchaser
“as is, where is,” and Sellers specifically disclaim any warranties, whether
express or implied, other than warranties of title. 

     6.8 Unclaimed
Funds. Except as disclosed on Schedule 6.8, (i) to
Sellers’ Knowledge, Sellers do not have any liabilities, at or as of the Closing
Date, under the unclaimed funds or unclaimed property laws of any jurisdiction
in which Sellers transact business (“Jurisdictions”), except
liabilities reflected on the Financial Statements or the Interim Financial
Statements, (ii) Sellers have timely and properly reported and surrendered all
unclaimed funds and unclaimed property to the states in the Jurisdictions in
accordance with the laws of such Jurisdictions, and (iii) Sellers have complied
with, are not in violation of or delinquent in any respect to, the unclaimed
funds or unclaimed property laws of the Jurisdictions and have not paid,
received notice of or otherwise been subjected to any civil or criminal
penalties, including, without limitation, any fines, interest payments or other
penalties, under such laws.

     6.9
Litigation. Except as set forth on Schedule
6.9, there is no instance in which Sellers, in connection with the
operation of the Business or the Purchased Assets, are or have been within the
one-year period prior to the date of this Agreement (a) subject to any
unsatisfied Order or (b) a party, or, are threatened to be made a party, to any
complaint, action, suit, proceeding, hearing or investigation of any Person or
Governmental Authority relating to the Purchased Assets or that might affect the
Purchased Assets. Other than dealing with customer complaints and issues in the
Ordinary Course of Business, to Sellers’ Knowledge, except as set forth on
Schedule 6.9, no event has occurred or circumstances exist that
could give rise to or serve as a basis for the commencement of any complaint,
action, suit, proceeding, hearing or investigation of any Person or Governmental
Authority relating to the Purchased Assets or that might affect the Purchased
Assets. There are no judicial or administrative actions, proceedings or
investigations pending or, to Sellers’ Knowledge, threatened that question the
validity of this Agreement, the Ancillary Agreements or any of the transactions
contemplated hereby or thereby. 

16

     6.10 Compliance with
Laws. To Sellers’ Knowledge, Sellers are now, and have been
within the past three years, in material compliance with all Laws and Orders
applicable to the Purchased Assets and the Business, including without
limitation, those respecting (a) labor and employment Laws, standards and
practices (including, without limitation, all payroll and payroll withholding
practices associated therewith), (b) zoning applicable to the operation of the
Business on the Leased Real Property, (c) Intellectual Property and (d)
Environmental Laws. No member of the Seller Group has Knowledge of any proposed
Law or Order that would be applicable to the Purchased Assets or the Business
and that would result in a Material Adverse Change to the Purchased Assets or
the Business.

     6.11 Conduct of
Business. Since July 31, 2007, Sellers have not:

     (a)
mortgaged, pledged or subjected to any Lien, any of the Purchased Assets, except
Permitted Exceptions and except to the Lenders;

     (b) sold,
assigned, licensed, leased or transferred (including, without limitation,
transfers to any employees, Seller Group or any of their Affiliates) any
Purchased Assets except in the Ordinary Course of Business, or canceled any
debts or claims;

     (c)
waived any rights of value or suffered any losses except in the Ordinary Course
of Business;

     (d) taken
any other action or entered into any other transaction (including any
transactions with employees, Seller Group or any of their Affiliates) other than
(i) in the Ordinary Course of Business; (ii) with the Lenders; and/or (iii) the
transactions contemplated by this Agreement and the Ancillary Agreements;

     (e)
suffered any theft, damage, destruction or material loss of or to any Purchased
Assets;

     (f)
increased the salary, wages or other compensation rates of any officer,
employee, director or consultant of Sellers except in the Ordinary Course of
Business;

     (g) made
any change in accounting or Tax principles, practices or policies from those
utilized in the preparation of the Financial Statements;

     (h) made
any write-off or write-down of or made any determination to write-off or
write-down any of the assets and properties of Sellers, except in the Ordinary
Course of Business;

     (i) made
any change in the general pricing practices or policies or any change in the
credit or allowance practices or policies; or

     (j)
entered into any amendment, modification, termination (partial or complete) or
granted any waiver under or given any consent with respect to any Assumed
Contract, except in the Ordinary Course of Business.

17

     6.12 Labor
Matters.

     (a)
Union and Employee Contracts. Except as set forth on
Schedule 6.12(a), (i) Sellers are not a party to or bound by any
union contract, collective bargaining agreement, employment contract,
independent contractor agreement, consultation agreement or other similar type
of contract, (ii) Sellers have not agreed to recognize any union or other
collective bargaining unit and (iii) no union or collective bargaining unit has
been certified as representing the employees of Sellers and no organizational
attempt has been made or threatened by or on behalf of any labor union or
collective bargaining unit with respect to any employees of Sellers employed in
connection with the Business. With respect to its Business, Sellers have not
experienced any labor strike, dispute, slowdown or stoppage or any other labor
difficulty during the past five years.

     (b)
List of Employees, Etc. Schedule 6.12(a) sets forth a list of the
employees, consultants and independent contractors of Sellers, their positions,
their dates of hire, whether their status is active or inactive (and if
inactive, the reason that they are inactive and their expected return to work
date), their work status (full-time, part-time, temporary, casual, etc.), the
rate of all regular and special compensation payable to each such person in any
and all capacities and any regular or special compensation that will be payable
to each such person in any and all capacities as of the Closing Date other than
the then current accrual of regular payroll compensation. Except as set forth on
Schedule 6.12(a), no member of the Seller Group has any Knowledge
that any of the employees with respect to the Sellers’ business intends to
terminate their employment relationship with Sellers.

     (c)
Labor and Employee Laws. Except as set forth on
Schedule 6.12(c), there are no audits,
complaints, claims or charges pending, outstanding, or to Sellers’ Knowledge,
anticipated or threatened, nor are there any orders, decisions, directions or
convictions currently registered or outstanding by any Governmental Authority
against or in respect of Sellers under any Laws pertaining to labor and
employment, and without limiting the generality of the foregoing, there are no
outstanding, pending or threatened charges or complaints against Sellers
relating to unfair labor practices or discrimination or under any legislation
relating to employees, labor or labor relations. Sellers have paid in full all
amounts owing under applicable workers compensation legislation, and the
workers’ compensation claims experience of Sellers would not permit a penalty
reassessment under such legislation. There are no charges or orders requiring
Sellers to comply outstanding under applicable occupational health and safety
legislation. 

     6.13
[intentionally left blank]

     6.14
Environmental. Except as set forth on Schedule
6.14:

     (a) To
Sellers’ Knowledge, Sellers have not been in material violation of any
Environmental Law, engaged in or permitted any operations or activities upon, or
any use or occupancy of the Real Property, or any portion thereof, for the
purpose of or in 

18

any way involving the handling,
manufacture, treatment, storage, use, generation, release, discharge, refining,
dumping or disposal of any Hazardous Materials (whether legal or illegal,
accidental or intentional) on, under, in or about the Real Property, or
transported any Hazardous Materials to, from or across the Real Property, nor
are any Hazardous Materials presently constructed, deposited, stored or
otherwise located on, under, in or about the Real Property, nor, to the Sellers’
Knowledge, have any Hazardous Materials migrated from the Real Property upon or
beneath other properties, nor, to the Sellers’ Knowledge, have any Hazardous
Materials migrated or threatened to migrate from other properties upon, about or
beneath the Real Property.

     (b) To
Sellers’ Knowledge, Sellers presently are and have been in material compliance
with all Environmental Laws applicable to the Real Property, and there exists no
Environmental Conditions that require reporting, investigation, assessment,
cleanup, remediation or any other type of response action pursuant to any
Environmental Law or that could be the basis for any liability of any kind
pursuant to any Environmental Law.

     (c)
Neither the Sellers nor the Shareholder have received written notice or other
communication concerning any alleged violation of Environmental Law, whether or
not corrected to the satisfaction of the appropriate authority, nor notice or
other communication concerning alleged liability for Environmental Damages in
connection with the Real Property and there exists no writ, injunction, decree,
order or judgment outstanding, nor any lawsuit, claim, proceeding, citation,
directive, summons or investigation, pending or threatened, relating to the
ownership, use, maintenance or operation of the Real Property by any person, or
from alleged violation of Environmental Laws, or from the suspected presence of
Hazardous Material on the Real Property.

     (d) To
Sellers’ Knowledge, there are no underground tanks and related pipes, pumps and
other facilities regardless of their use or purpose whether active or abandoned
at the Real Property.

     (e) (i)
There currently are effective all Permits required under any Environmental Law
which are necessary for the Sellers’ activities and operations at the Real
Property and for any ongoing alterations or improvements at the Real Property;
and (ii) any applications for renewal of such Permits have been submitted on a
timely basis.

     (f)
Sellers have made available to the Purchaser copies of all documents, records
and information in its possession or control concerning Environmental
Conditions, including, without limitation, previously conducted environmental
audits and documents regarding any disposal of Hazardous Materials at, upon or
from the Real Property, spill control plans and environmental agency reports and
correspondence.

     6.15
Contracts. Schedule 6.15 sets forth all
of the contracts including, without limitation, any contract, agreement, lease,
instrument, guarantee, bid, order or proposal that relate to the Purchased
Assets or which any of the Purchased Assets are bound (the
“Contracts”). Sellers have provided to the Purchaser true,
correct and complete copies of each 

19

such Contract, as amended to date. Each
Assumed Contract listed on Schedule 6.15 (or required to be listed
on Schedule 6.15) is a valid, binding and enforceable
obligation of Sellers, enforceable in accordance with its terms except as may be
limited by the General Enforceability Exceptions. With respect to the Assumed
Contracts set forth on Schedule 6.15 (or required to be listed on
Schedule 6.15), except as set forth therein: (a) Sellers are not,
nor any other party thereto is in default under or in violation of any Assumed
Contract; (b) no event has occurred which (with notice or lapse of time, or
both) would constitute such a default or violation by Sellers or any other party
to any Assumed Contract; and (c) Sellers have not released any of their rights
under any Assumed Contract.

     6.16 Licenses and
Permits. Schedule 6.16 sets forth a true and
complete list and description of all licenses, permits and other authorizations
of any Governmental Authority held by Sellers and used by Sellers in the conduct
of the Business. To Sellers’ Knowledge, except for the licenses, permits and
authorizations set forth and described in Schedule 6.16, there are
no licenses, permits or other authorizations, whether written or oral, necessary
or required for the conduct of the Business or for their ownership or use of any
of the Purchased Assets.

     6.17 Software
Programs. Schedule 6.17 sets forth a complete and
correct list of all Software programs used by Sellers in the Business. All fees
associated with maintaining any Intellectual Property required to have been set
forth on Schedule 6.17 have been paid in full in a timely
manner.

     6.18 Financial
Statements.

     (a) Schedule 6.18
sets forth true and complete copies of (i) the audited balance sheets of Sellers
as of December 31, 2006 and 2005 and the related audited statements of income
and shareholders’ equity for the years then ended, together with the notes
thereto, and the other financial information included therewith (collectively,
the “Financial Statements”), and (ii) reviewed balance sheet as of
July 31, 2007, and the related statements of income for the six (6) month period
then ended (collectively the “Interim Financial Statements”).

     (b) The Financial Statements
present fairly, in all material respects, the financial position, results of
operations of Sellers at the dates and for the time periods indicated, and have
been prepared by the management of Sellers in a manner consistent with Sellers’
historic accounting practices, consistently applied throughout the periods
indicated. The Interim Financial Statements present fairly in all material
respects the financial position, results of operations and shareholders’ equity
of Sellers at the date and for the period indicated and have been prepared in a
manner consistent with Sellers’ historic accounting practices. The Financial
Statements and the Interim Financial Statements were derived from the books and
records of Sellers.

     6.19 Undisclosed
Liabilities. Except as reflected in the Interim Financial
Statements or as set forth on Schedule 6.19, Sellers have no
liabilities (whether accrued, absolute, contingent, unliquidated or otherwise,
whether due or to become due, whether known or unknown, regardless of when
asserted) arising out of transactions or events entered into prior to the
Closing Date, or any action or inaction, or any state of facts existing, with
respect to or based upon transactions or events occurring prior to the Closing
Date hereof, except liabilities 

20

which have arisen after the date of the Interim Financial
Statements in the Ordinary Course of Business.

     6.20 Accounts
Receivable. Except as set forth on Schedule 6.20,
all Accounts Receivable of Sellers represent sales actually made in the Ordinary
Course of Business or valid claims as to which full performance will have been
rendered by Sellers as of the Closing. The reserve on the Interim Financial
Statements against the Accounts Receivable for returns and bad debts has been
calculated in a manner consistent with past practice. No counter claims,
defenses or offsetting claims with respect to the Accounts Receivable of Sellers
are pending or, to Sellers’ Knowledge, threatened. Except as set forth on
Schedule 6.20, all of the Accounts Receivable of Sellers relate
solely to sales of goods or services to customers of Sellers, none of which are
Affiliates of any member of the Seller Group.

     6.21
Indebtedness. Schedule 6.21 sets forth a
true, correct and complete list of the individual components (indicating the
amount and the Person to whom such Indebtedness is owed) of all the Indebtedness
outstanding with respect to Sellers as of the Closing Date other than (i)
pursuant to the Seller Group Loan and Security Agreement; or Indebtedness to (A)
Calcott; (B) any Affiliate; and/or (C) any Family Affiliate.

     6.22
Taxes.

     (a) All Tax returns, statements,
reports and forms (including estimated tax or information returns and reports)
required to be filed with any Governmental Authority responsible for the
imposition of any Tax (a “Taxing Authority”) with respect to any
Tax period (or portion thereof) ending on or before the date of this Agreement
(a “Pre-Closing Tax Period”) by or on behalf of Sellers
(collectively, the “Returns”) have, to the extent required
to be filed on or before the date of this Agreement, been filed when due in
accordance with all applicable Laws.

     (b) The Returns (i) correctly
reflect in all material respects the facts regarding the income, business,
assets, operations, activities and status of Sellers as reported therein, (ii)
were correct and complete in all material respects and (iii) have been prepared
in accordance with all applicable Laws.

     (c) Sellers do not have any Tax
liabilities (whether due or to become due) with respect to the income, property
and operations of Sellers that relate to any Pre-Closing Tax Period, except for
(i) Tax liabilities reflected in the Interim Financial Statements or that have
arisen after the date of the Interim Financial Statements in the Ordinary Course
of Business; (ii) Taxes collectible or remittable, as applicable, by them that
will be remitted on or prior to the Closing Date; (iii) the Vehicle Liabilities;
and (iv) approximately $4000 in additional Taxes (other than the Vehicle
Liabilities) owed to the State of Indiana.

     (d) All Taxes owed by Sellers
(whether or not shown as due and payable on the Returns that have been filed)
have been timely paid, or withheld and remitted to the appropriate Taxing
Authority, except for (i) the Vehicle Liabilities; and (ii) approximately $4000
in additional Taxes (other than the Vehicle Liabilities) owed to the State of
Indiana.

21

     (e) Sellers have collected and
remitted all Taxes collectible or remittable, as applicable, by it on or before
the Closing Date, except for the Vehicle Liabilities.

     (f) There is no action, suit,
proceeding, claim, audit or investigation now pending of which any member of the
Seller Group is aware or any action, suit, proceeding, claim, audit or
investigation to Sellers’ Knowledge threatened against or with respect to
Sellers in respect of any Tax, other than inquiries from the State of Indiana
regarding the Vehicle Liabilities.

     (g) There are no Liens for Taxes
upon the Purchased Assets, except liens for (i) current Taxes not yet due; (ii)
the Vehicle Liabilities; and (iii) approximately $4000 in additional Taxes
(other than the Vehicle Liabilities) owed to the State of Indiana.

     6.23
[intentionally left blank]

     6.24
Brokers. Except as set forth on Schedule
6.24 no Person has acted directly or indirectly as a broker, finder or
financial advisor for any member of the Seller Group in connection with the
negotiations relating to the transactions contemplated by this Agreement, and no
Person is entitled to any fee or commission or like payment in respect thereof
based in any way on any agreement, arrangement or understanding made by or on
behalf of any member of the Seller Group.

     6.25
Disclosure. Neither this Agreement (including the
Exhibits and Schedules hereto) or the Ancillary Agreements nor any other
agreement, document, certificate or written statement furnished to the Purchaser
by or on behalf of Seller Group in connection with this Agreement, the Ancillary
Agreements or the transactions contemplated by hereunder or thereunder contains
any untrue statement of a material fact or omits to state a material fact
necessary in order to make the statements contained herein or therein not
misleading.

ARTICLE 7: REPRESENTATIONS AND WARRANTIES OF THE
PURCHASER

     The Purchaser hereby
represents and warrants to the Seller Group as follows:

     7.1 Existence and
Good Standing. The Purchaser is a corporation duly organized,
validly existing and in good standing under the laws of the State of Florida.

     7.2
Power. The Purchaser has the requisite power and
authority to execute, deliver and perform fully its obligations under this
Agreement and the Ancillary Agreements.

     7.3 Validity and
Enforceability. This Agreement and each of the Ancillary
Agreements have been duly and validly executed and delivered to the Seller Group
by the Purchaser. The execution, delivery and performance of this Agreement and
the Ancillary Agreements and the consummation of the transactions contemplated
hereby and thereby have been duly and validly authorized by all necessary action
on the part of the Purchaser and constitute the valid and legally binding
obligations of the Purchaser enforceable against the Purchaser in accordance
with their terms, except as may be limited by the General Enforceability
Exceptions.

22

     7.4 No
Conflict. Neither the execution of this Agreement or the
Ancillary Agreements, nor the performance by the Purchaser of its obligations
hereunder or thereunder will violate or conflict with the Purchaser’s Articles
of Incorporation or Bylaws or any Law or Order.

     7.5
Consents. No consent, approval or authorization of any
third party or Governmental Authority is required in connection with the
execution and delivery by the Purchaser of this Agreement or the Ancillary
Agreements or the consummation of the transactions contemplated hereby or
thereby.

     7.6
Brokers. Except GVC Financial Services LLC, no Person
has acted directly or indirectly as a broker, finder or financial advisor for
the Purchaser in connection with the negotiations relating to the transactions
contemplated by this Agreement, and no Person is entitled to any fee or
commission or like payment in respect thereof based in any way on any agreement,
arrangement or understanding made by or on behalf of the Purchaser.

ARTICLE 8: COVENANTS RELATING TO CONDUCT OF
BUSINESS

     During the period from the date
of this Agreement and continuing until the Closing, the Seller Group agrees
(except as expressly contemplated by this Agreement or to the extent that the
Purchaser shall otherwise consent in writing) that:

     8.1 Conduct of
Business. They shall carry on the business of Sellers in a commercially
reasonable manner considering their financial position and to the extent
consistent with such business and the advances received from the Lenders, use
all reasonable efforts consistent with past practice and policies to preserve
intact its present business organization, keep available the services of its
present officers and key employees and preserve its relationships with
customers, suppliers and others having business dealings with it, provided,
further, without limitation of the foregoing, that they shall not, other than in
the Ordinary Course of Business:

     (a)
borrow any amount or incur or become subject to any liability except (i) current
liabilities incurred in the Ordinary Course of Business, (ii) liabilities under
Contracts entered into in the Ordinary Course of Business and (iii) borrowings
under lines of credit existing on the date hereof;

     (b)
mortgage, pledge or subject to any Lien, any of the Purchased Assets, except
Permitted Exceptions and except to the Lenders;

     (c) sell,
assign or transfer (including, without limitation, transfers to any employees,
Seller Group or any of their Affiliates) any Purchased Assets except in the
Ordinary Course of Business;

     (d)
suffer any losses except in the Ordinary Course of Business;

     (e) take
any other action or enter into any other transaction (including any transactions
with employees, Seller Group or any of their Affiliates) other than (i) in the
Ordinary Course of Business or (ii) the transactions contemplated by this
Agreement and the Ancillary Agreements or (iii) cancellation of accounts
receivable with Affiliates 

23

and Family Affiliates, intercompany
receivables, and other claims for money due to Sellers from Shareholder and/or
any Affiliate or Family Affiliate;

     (f)
suffer any theft, damage, destruction or material loss of or to any Purchased
Assets that will result in a Material Adverse Change;

     (g) (i)
increase the salary, wages or other compensation rates of any officer, employee,
director, partner or consultant of Sellers or (ii) make or grant any increase in
any employee benefit plan, or amend or terminate any existing employee benefit
plan, or adopt any new employee benefit plan or (iii) make any commitment or
incur any liability to any labor organization;

     (h) make
any capital expenditures or commitments therefor outside of the Ordinary Course
of Business;

     (i) fail
to pay any obligations of the Sellers in a timely manner (except obligations
disputed in good faith) that the Lenders have agreed to fund; 

     (j) make
any change in accounting or tax principles, practices or policies from those
utilized in the preparation of the Financial Statements;

     (k) make
any write-off or write-down of or make any determination to write-off or
write-down any of the assets and properties of Sellers, other than (i) in the
Ordinary Course of Business; or (ii) cancellation of accounts receivable with
Affiliates and Family Affiliates, intercompany receivables, and other claims for
money due to Sellers from Shareholder and/or any Affiliate or Family
Affiliate;

     (l) make
any change in the general pricing practices or policies or any change in the
credit or allowance practices or policies of Sellers, including but not limited
to, accelerating the collection of Accounts Receivable or other obligations
owned to Sellers in the Ordinary Course of Business;

     (m) other
than in the Ordinary Course of Business, enter into any amendment, modification,
termination (partial or complete) or grant any waiver under or give any consent
with respect to any agreement that is required (or had it been in effect on the
date hereof would have been required) to be disclosed in the Schedules to this
Agreement; or 

     (n)
commence or terminate any line of business.

     8.2 No Shop
Covenant. The Seller Group covenants and agrees that until the earlier
to occur of the Closing Date and the date this Agreement is terminated pursuant
to Article 12 herein, Purchaser shall be, and is hereby, granted
the exclusive right to (i) hold discussions and negotiations with the Seller
Group with respect to the possible acquisition by Purchaser of the Purchased
Assets, (ii) receive, evaluate and review any and all information,
correspondence and/or the materials provided by Sellers and/or Shareholder with
respect to the possible acquisition by Purchaser of the Purchased Assets, and
(iii) conduct inspections, reviews and studies of Sellers, the Purchased Assets,
and any information and materials related thereto, 

24

with respect to the possible acquisition by Purchaser of the
Purchased Assets. Prior to the earlier to occur of the Closing Date and the date
this Agreement is terminated pursuant to Article 12 herein, in no
event shall Sellers, Shareholder or any other member of the Seller Group (i)
execute any memorandum, letter agreement, commitment, letter of intent, or any
other agreement with any Person with respect to the possible sale of all or
substantially all of the assets of Sellers, including, but not limited to, the
Purchased Assets, the capital stock of Sellers, or merger with the company or
(ii) engage in any discussions or negotiations with any Person (or engage or
permit any agent, representative or advisor to review any offer or negotiate)
with respect to the sale of all or substantially all of the assets of Sellers,
including, but not limited to, the Purchased Assets, the capital stock of
Sellers, or merger with the company or (iii) deliver any of the information with
respect to Sellers to any Person with respect to any possible sale of all or
substantially all of the assets of Sellers, including, but not limited to, the
Purchased Assets, the capital stock of Sellers, or merger with the company.

ARTICLE 9: CONDITIONS PRECEDENT

     9.1 Conditions to
Each Party’s Obligation. The respective obligation of each party
hereunder shall be subject to the satisfaction prior to the Closing Date of the
following conditions:

     (a)
Approval. All authorizations, consents, orders or approvals of, or
declarations or filings with, or expiration of waiting periods imposed by, any
Governmental Authority necessary for the consummation of the transactions
contemplated by this Agreement shall have been filed, occurred or been
obtained.

     (b)
Legal Action. No action, suit or proceeding shall have been
instituted or threatened before any court or governmental body seeking to
challenge or restrain the transactions contemplated hereby.

     (c)
Assumed Leases. Sellers, the Purchaser and the lessors shall have
entered into applicable lease assignments with respect to any Real Property
Leases set forth on Schedule 2.1(d).

     (d)
New Leases. The Purchaser and Sellers’ Affiliate(s) shall have
entered into leases with respect to the Real Property set forth on
Schedule 9.1(d). Sellers shall have delivered lease termination
agreements with respect to the Real Property set forth on Schedule
9.1(d).

     9.2 Conditions of
Obligations of the Purchaser. In addition to the conditions set forth in
Section 9.1 the obligations of the Purchaser to effect the transactions
contemplated hereby are subject to the satisfaction of the following conditions
unless waived by the Purchaser:

     (a)
Due Diligence. The results of the Purchaser’s due diligence
investigation (the “Due Diligence Investigation”), must be
acceptable to the Purchaser in its sole discretion. The Purchaser will have
until September 30, 2007 to complete its Due Diligence Investigation (the
“Due Diligence Period”). If, prior to the expiration of the Due
Diligence Period, the Purchaser determines that based upon its Due Diligence

25

Investigation it is unwilling to
proceed with the Closing, then Purchaser may immediately terminate this
Agreement and the Purchaser will not be required to consummate the transactions
contemplated hereby.

     (b)
Representations and Warranties. The representations and warranties
of the Seller Group set forth in this Agreement, when read together with the
Schedules, shall be true and correct in all material respects as of the date of
this Agreement and as of the Closing Date as though made on and as of the
Closing Date, and the Purchaser shall have received a certificate signed by
officers of the Sellers and by the Shareholder to such effect.

     (c)
Performance of Obligations of the Seller Group. The Seller Group
shall have performed all obligations required to be performed by them under this
Agreement prior to the Closing Date, and the Purchaser shall have received a
certificate signed by officers of the Sellers and the Shareholder to such
effect.

     (d)
No Material Adverse Change. There shall have been no Material
Adverse Change in the Business.

     (e)
Consents and Actions. All requisite consents of any third parties
to the transactions contemplated by this Agreement shall have been obtained in a
form acceptable to the Purchaser in its sole but reasonably exercised
discretion, including the consents of the parties to the Assumed Contracts to
the assignment of such Assumed Contracts to the Purchaser.

     (f)
Closing Deliveries. The Seller Group shall have delivered, or
cause to be delivered, to the Purchaser at or prior to the Closing all of the
documents or items set forth in Section 5.2.

     (g)
Release of Security Interests. Any Liens filed against the
Sellers’ assets shall have been released.

     (h)
Tax, Tag and Title. Except for the Vehicle Liabilities, the
Sellers shall be current on all of their sales tax, tag and title obligations
with respect to all motor vehicles sold by them prior to the Closing Date.

     (i)
Financing. Purchaser shall have received financing on terms
agreeable to it in its sole discretion for the portion of the Purchase Price
that is required to repay the Indebtedness of the Sellers to the Lenders. 

     9.3 Conditions of
Obligation of the Seller Group. The obligations of the Seller Group to
effect the transactions contemplated hereby are subject to the satisfaction of
the following conditions unless waived by the Seller Group:

     (a)
Representations and Warranties. The representations and warranties
of the Purchaser set forth in this Agreement shall be true and correct in all
material respects as of the date of this Agreement and as of the Closing Date as
though made on and as of the Closing Date.

26

     (b)
Performance of Obligations of the Purchaser. The Purchaser shall
have performed all obligations required to be performed by it under this
Agreement prior to the Closing Date.

     (c)
Closing Deliveries. The Purchaser shall have delivered or cause to
be delivered, to or for the benefit of the Seller Group at or prior to the
Closing all of the documents or items set forth in Section
5.3.

     (d)
Payments under New Leases. Purchaser shall pay Midwest Real Estate
Management Limited Partnership One Hundred Nine Thousand Eight Hundred Nine and
00/100 Dollars ($109,809.00) for initial rent and security deposits due under
the Leases with respect to the Real Property set forth on Schedule
9.1(d).

ARTICLE 10: ADDITIONAL AGREEMENTS

     10.1 Post-Closing
Access to Books and Records. From and after the Closing Date upon prior
reasonable notice by Sellers and during the Purchaser’s regular business hours,
the Purchaser shall make available to Sellers and to its agents and employees
all books, records, documents and employees relating to the Business (to the
extent they relate to the pre-Closing period) as may be reasonably necessary for
the purposes of:

     (a)
preparing tax returns and financial statements;

     (b)
investigating, preparing for the defense or prosecution of, and prosecuting or
defending any litigation, proceeding or investigation which is based upon, or
arises out of the Business, or any of the assets or liabilities of the
Business;

     (c)
preparing reports to government agencies; or

     (d) for
such other purposes for which access to such documents is agreed by the parties
to be reasonably necessary;

     provided, however,
that access to such books, records, documents and employees shall not
unreasonably interfere with the normal operation of the Business by the
Purchaser. The Purchaser shall maintain and preserve such books, records and
other documents for five (5) years after the Closing Date.

     10.2 Employee
Matters. Sellers acknowledge and agree that the Purchaser may determine
in its sole discretion which employees it desires to hire after the Closing
Date. Nothing in this Agreement shall be construed as a commitment or obligation
of the Purchaser to offer employment, or otherwise continue the employment of,
any of the employees.

     10.3 Access.
Sellers will afford the Purchaser reasonable access to the Sellers and the
personnel records, properties, Contracts, financial statements, books and
records, and all other documents and data pertaining to the Sellers.

27

     10.4 Nonassignable
Contracts. Notwithstanding anything in this Agreement to the contrary,
this Agreement shall not constitute an agreement to sell, convey, assign,
sublease or transfer any Purchased Assets if any attempted sale, conveyance,
assignment, sublease or transfer of such assets, without the consent of another
Person to such transfer, would constitute a breach by Sellers or the Purchaser
with respect to such Purchased Asset. In the event that any required consent is
not obtained on or prior to the date of this Agreement, Sellers will use their
best efforts to (i) provide to the Purchaser the benefits of the applicable
Assumed Contract, (ii) cooperate in any reasonable and lawful arrangement
designed to provide such benefits to the Purchaser and (iii) enforce at the
request of the Purchaser and for the account of the Purchaser any rights of
Sellers arising from any such Assumed Contract (including the right to elect to
terminate such Assumed Contract in accordance with the terms thereof upon the
request of the Purchaser).

     10.5
Autostar. Sellers have paid the monthly maintenance charge of
$4,000 to continue their contract with Autostar through October 31, 2007.

     10.6 Agreement To
Forward E-mails. Sellers agree that for a period of thirty (30) days
following the Closing, it will forward to the Purchaser all e-mails received by
Sellers from Persons who were: (i) customers of Sellers prior to the Closing; or
(ii) potential customers seeking information on a Buy-Here Pay-Here automobile
purchase; provided that Sellers will only be required to forward such e-mails if
Sellers have been granted continued use of their server after the Closing during
such period.

     10.7 Removal of
Motor Vehicle Inventory. Sellers shall remove all motor vehicle
inventory from each Real Property location no later than 5:00 P.M. on Friday,
October 5, 2007.

     10.8
Reports. Sellers agree to promptly provide to Purchaser upon
request of Purchaser any reports capable of being produced from the Reynolds and
Reynolds Software program relating to the Accounts Receivable, customers of
Sellers that will become customers of Purchaser post-Closing, or the Purchased
Assets.

     10.9 Credit Card
Payments. All credit card payments made to Sellers on or after September
28, 2007, and relating to any of the Purchased Assets and/or Assumed Contracts
shall be immediately paid over to Purchaser, or in the alternative, to the
Lenders for the benefit of Purchaser.

     10.10 Vehicle
Liabilities. Purchaser shall pay the Vehicle Liabilities on or before
October 10, 2007.

ARTICLE 11: REMEDIES

     11.1 General
Indemnification Obligation. As Purchaser’s exclusive remedy, each member
of the Seller Group shall, jointly and severally, indemnify and hold harmless
the Purchaser and its officers, directors, employees, agents and Affiliates from
and against any and all losses, liabilities, claims, damages, penalties, fines,
judgments, awards, settlements, taxes, costs, fees, expenses (including, but not
limited to, reasonable attorneys’ fees) and disbursements (collectively, the
“Losses”) actually sustained by any of such Persons based upon,
arising out of 

28

or otherwise in respect of (a) any inaccuracies in any
representation or warranty, or any breach of any covenant or agreement of any
member of the Seller Group contained in this Agreement (including any Schedule
or Exhibit attached hereto) or any Ancillary Agreement, and (b) any of the
Retained Liabilities. As each member of the Sellers Group’s exclusive remedy,
the Purchaser shall indemnify and hold harmless the Seller Group and each of its
respective officers, directors, employees, agents and Affiliates from and
against any and all Losses actually sustained by any of such Persons resulting
from (a) any inaccuracies in any representation or warranty, or any breach of
any covenant or agreement of the Purchaser contained in this Agreement
(including any Schedule or Exhibit attached hereto) or any Ancillary Agreement,
and (b) any of the Assumed Liabilities.

     11.2 Notice and
Opportunity to Defend.

     (a) Notice of Asserted
Liability. As soon as is reasonably practicable after the Seller Group,
on the one hand, or the Purchaser, on the other hand, becomes aware of any claim
that may result in a Loss, but for which it or they are entitled to
indemnification under Section 11.1 hereof (a “Liability
Claim”), such party (the “Indemnified Party”) shall give
notice thereof (a “Claims Notice”) to the other party (the
“Indemnifying Party”). A Claims Notice shall describe the
Liability Claim in reasonable detail, and shall indicate the amount (estimated,
if necessary and to the extent feasible) of the Loss that has been or may be
suffered by the Indemnified Party. No delay in or failure to give a Claims
Notice by the Indemnified Party to the Indemnifying Party pursuant to this
Section 11.2(a) shall adversely affect any of the other rights or
remedies which the Indemnified Party has under this Agreement, or alter or
relieve the Indemnifying Party of its obligation to indemnify the Indemnified
Party to the extent that such delay or failure has not materially prejudiced the
Indemnifying Party.

     (b) Opportunity to
Defend. The Indemnifying Party shall have the right, exercisable by
written notice to the Indemnified Party within thirty (30) days of receipt of a
Claims Notice from the Indemnified Party of the commencement or assertion of any
Liability Claim in respect of which indemnity may be sought under this
Article 11 for a claim brought by a third party to assume and
conduct the defense of such Liability Claim in accordance with the limits set
forth in this Agreement with counsel selected by the Indemnifying Party and
reasonably acceptable to the Indemnified Party; provided, however,
that (i) the defense of such Liability Claim by the Indemnifying Party will not,
in the reasonable judgment of the Indemnified Party, have a material adverse
effect on the Indemnified Party; and (ii) the Indemnifying Party has sufficient
financial resources, in the reasonable judgment of the Indemnified Party, to
satisfy the amount of any adverse monetary judgment that is reasonably likely to
result; and (iii) the Liability Claim solely seeks (and continues to seek)
monetary damages; and (iv) the Indemnifying Party expressly agrees in writing
that as between the Indemnifying Party and the Indemnified Party, the
Indemnifying Party shall hold the Indemnified Party harmless and obtain the
unconditional release of the Indemnified Party for any obligation for the
Liability Claim in accordance with the limits set forth in this Agreement (the
conditions set forth in clauses (i) through (iv) are collectively referred to as
the “Litigation Conditions”). If the Indemnifying Party does not
assume the defense of a Liability Claim in accordance with this Section
11.2(b), the Indemnified Party may continue to defend the Liability
Claim. If the Indemnifying Party has assumed the defense of a Liability Claim as
provided in this Section 11.2(b), the Indemnifying Party will not
be liable for any legal expenses 

29

subsequently incurred by the Indemnified Party in connection
with the defense thereof; provided, however, that if (i) any of
the Litigation Conditions cease to be met or (ii) the Indemnifying Party fails
to take reasonable steps necessary to defend diligently such Liability Claim,
the Indemnified Party may assume its own defense, and the Indemnifying Party
shall be liable for all reasonable costs or expenses paid or incurred in
connection therewith. The Indemnifying Party or the Indemnified Party, as the
case may be, has the right to participate in (but not control), at its own
expense, the defense of any Liability Claim that the other is defending as
provided in this Agreement. The Indemnifying Party, if it shall have assumed the
defense of any Liability Claim as provided in this Agreement, shall not, without
the prior written consent of the Indemnified Party, consent to a settlement of,
or the entry of any judgment arising from, any such Liability Claim which (i)
does not include as an unconditional term thereof the giving by the claimant or
the plaintiff to the Indemnified Party a complete release from all liability in
respect of such Liability Claim, or (ii) grants any injunctive or equitable
relief or (iii) may reasonably be expected to have a material adverse effect on
the affected business of the Indemnified Party. The Indemnified Party shall have
the right to settle any Liability Claim, the defense of which has not been
assumed by the Indemnifying Party.

     11.3 Survivability
of Representations and Warranties and Covenants;
Limitations on Indemnification. The representations and
warranties of the Seller Group and the Purchaser combined in this Agreement will
survive for a period ending on the second anniversary of the Closing Date (the
“Expiration Date”); provided, however, that (i) the
Expiration Date for any Liability Claim relating to a breach of or an inaccuracy
in the representations and warranties set forth in Section 6.9
(Litigation), Section 6.10 (Compliance with Laws), Section
6.14 (Environmental) and Section 6.22 (Taxes) shall be the
expiration of the applicable statute of limitations (taking into account any
extensions, suspension or tolling under applicable Law); (ii) there will be no
Expiration Date for any Liability Claim relating to a breach of or inaccuracy in
the representations and warranties set forth in Section 6.1
(Existence and Good Standing), Section 6.2 (Power), Section
6.3 (Enforceability), Section 6.6(a) (Title), and
Section 6.24 (Brokers) (the representations and warranties set
forth in clauses (i) and (ii) of this Section 11.3(a) are,
collectively, the “Excluded Representations”) and (iii) any
Liability Claim pending on any Expiration Date for which a Claims Notice has
been given in accordance with Section 11.2(a) on or before such
Expiration Date may continue to be asserted and indemnified against until
finally resolved. All of the covenants and agreements of the Sellers and the
Purchaser contained in this Agreement shall survive after the Closing Date in
accordance with their terms for an indefinite period. There will be no
Expiration Date for any Liability Claim relating to fraud or intentional
misrepresentation.

     11.4 Limits on
Indemnification. Notwithstanding anything to the contrary contained in
this Article 11 or elsewhere in this Agreement, no Indemnifying
Party shall have any liability as a result of any inaccuracy in any
representation or warranty in this Agreement (i) unless and until the aggregate
amount of all such Losses sustained by the Indemnifying Party exceeds
Twenty-Five Thousand and No/100 Dollars ($25,000.00) (the
“Basket”), in which case, the Indemnifying Party shall be liable
for all such Losses without regard to such threshold (including the first
$25,000) or (ii) in excess of the Closing Payment (the “Cap”),
provided, however, that the Basket and the Cap shall not apply to the Excluded
Representations, or with respect to fraud or intentional misrepresentation.

30

ARTICLE 12: TERMINATION AND WAIVER

     12.1
Termination. This Agreement may be terminated at any time
prior to the Closing:

     (a)
by mutual written consent of the Purchaser and the Seller Group;

     (b) by
either the Purchaser or the Seller Group in the event that any Governmental
Authority shall have issued an order, decree or ruling or taken any other action
restraining, enjoining or otherwise prohibiting the transactions contemplated by
this Agreement and the Ancillary Agreements and such order, decree, ruling or
other action shall have become final and nonappealable; 

     (c) by
the Purchaser if, between the date hereof and the time scheduled for the
Closing: (i) any representation or warranty of the Seller Group contained in
this Agreement shall not have been true and correct when made and as of the
Closing Date, (ii) the Seller Group shall not have complied with any covenant or
agreement to be complied with by Seller Group and contained in this Agreement
unless such covenant or agreement is capable of being cured and is cured by the
Seller Group within five (5) days written notice thereof by the Purchaser, (iii)
any of the conditions to closing set forth in Sections 9.1 and
9.2 of this Agreement shall not have been satisfied, unless such
failure shall be due to the failure of the Purchaser to perform or comply with
any of the conditions hereof to be performed or complied with by it prior to the
Closing, or (iv) the Sellers makes a general assignment for the benefit of
creditors, or any proceeding shall be instituted by or against the Sellers
seeking to adjudicate it a bankrupt or insolvent, or seeking liquidation,
winding up or reorganization, arrangement, adjustment, protection, relief or
composition of their debts under any Law relating to bankruptcy, insolvency or
reorganization; or

     (d) by
the Seller Group if, between the date hereof and the time scheduled for the
Closing: (i) any representation or warranty of the Purchaser contained in this
Agreement shall not have been true and correct when made and as of the Closing
Date, (ii) the Purchaser shall not have complied with any covenant or agreement
to be complied with by it and contained in this Agreement unless such covenant
or agreement is capable of being cured and is cured by the Purchaser within five
(5) days written notice thereof by the Seller Group, (iii) any of the conditions
to closing set forth in Sections 9.1, and 9.3 of
this Agreement shall not have been satisfied, unless such failure shall be due
to the failure of the Seller Group to perform or comply with any of the
conditions hereof to be performed or complied by it prior to the Closing, or
(iv) the Purchaser makes a general assignment for the benefit of creditors, or
any proceeding shall be instituted by or against the Purchaser seeking to
adjudicate it a bankrupt or insolvent, or seeking liquidation, winding up or
reorganization, arrangement, adjustment, protection, relief or composition of
its debts under any Law relating to bankruptcy, insolvency or
reorganization.

     12.2 Effect of
Termination. In the event of termination of this Agreement as provided
in Section 12.1, this Agreement shall forthwith become void and
there shall be no liability on the part of either party, provided,
however, that Article 11 and Sections 14.1,
14.2 

31

and 14.9 hereof shall survive any termination;
provided, further, that nothing herein shall relieve a party
hereto from liability for a breach of any of its representations, warranties,
agreements and covenants contained in this Agreement.

     12.3 Waiver.
Either party to this Agreement may (a) extend the time for the performance of
any of the any obligations or other acts of the other party, (b) waive any
inaccuracies in the representations and warranties of the other party contained
herein or in any document delivered by the other party pursuant hereto or (c)
waive compliance with any of the agreements or conditions of the other party
contained herein. Any such extension or waiver shall be valid only if set forth
in an instrument in writing signed by the party to be bound thereby. Any waiver
of any term or condition shall not be construed as a waiver of any subsequent
breach or a subsequent waiver of the same term or condition, or a waiver of any
other term or condition, of this Agreement. The failure of either party to
assert any of its rights hereunder shall not constitute a waiver of any of such
rights.

32

ARTICLE 13: CONFIDENTIALITY

     13.1
Confidentiality. 

     (a) The Seller Group acknowledges
that it possesses certain confidential, proprietary and trade secret
information, materials and business concepts with respect to the operation of
the Business, including (i) information regarding sales and marketing, products,
services, vendors, customer lists and files (including former customers),
accounting data and methods, operating procedures, pricing policies, strategic
plans, intellectual property, customer contracts and other agreements; (ii)
information which the Seller Group acquires about the Purchaser’s Business by
reason of the involvement of the Seller Group in the transactions contemplated
by this Agreement, and (iii) except as set forth below, any and all information
relating to the terms of the transactions contemplated by this Agreement
(collectively, the “Sellers’ Confidential Information”). During
the first five (5) years following the Closing Date, the Seller Group agrees:
not to publish, copy, disclose, allow to be disclosed, or use in the Restricted
Territory, as that term is defined in the Calcott Noncompetition Agreement, for
the benefit of any Competitive Business, as that term is defined in the Calcott
Noncompetition Agreement, the Sellers’ Confidential Information without the
prior written consent of the Purchaser, which can be withheld in its sole
discretion. As used herein, the term “Purchaser’s Business” means
the business of the Purchaser or any of its subsidiaries as conducted on and
prior to the date hereof, as well as the business that the Purchaser is
acquiring pursuant hereto. “Sellers’ Confidential Information”
does not include information which: (i) is in or enters the public domain or is
or becomes generally known in the industry without breach of the confidentiality
obligations in this Agreement; or (ii) is received by the Seller Group from a
third party without any breach of any obligation of confidentiality in respect
of such information provided that the receipt of such information is not subject
to any obligations of confidentiality. Notwithstanding the foregoing, the Seller
Group may disclose Sellers’ Confidential Information in the following
circumstances: (A) disclosure to third parties to the extent that the Sellers’
Confidential Information is necessary for disclosure on income tax returns of
any members of the Seller Group or in any litigation in connection with the
Business, provided that the Seller Group promptly notify the Purchaser as early
as practicable upon learning of such requirement; and (B) disclosure to legal
counsel for the Seller Group, accountants or professional advisors to the extent
necessary for them to advise upon the interpretation or enforcement of this
Agreement. 

     (b) Prior to the Closing, the
Purchaser and the Seller Group will be bound by the obligations and duties in
the letter of intent dated September 10, 2007, under the section titled
“Securities Matters; Confidentiality.”

33

ARTICLE 14: MISCELLANEOUS

     14.1 Further
Assurances. From and after the Closing Date, at the request of the
Purchaser, the Seller Group shall execute and deliver or cause to be executed
and delivered to the Purchaser such other agreements or instruments, in addition
to those required by this Agreement, as the Purchaser may reasonably request, in
order to implement the transactions contemplated by this Agreement. From and
after the Closing Date, at the request of the Seller Group, the Purchaser shall
execute and deliver or cause to be executed and delivered to the Seller Group,
such other agreements or instruments, in addition to those required by this
Agreement, as the Seller Group may reasonably request, in order to implement the
transactions contemplated by this Agreement. 

     14.2
Expenses. Each of the parties shall bear their respective
expenses incurred or to be incurred in connection with the execution and
delivery of this Agreement and the Ancillary Agreements and the consummation of
the transactions contemplated hereby, provided, further, that to clarify the
foregoing, the Purchaser shall pay the fees and expenses of GVC Financial
Services, LLC.

     14.3 No
Assignment. The rights and obligations of the parties under this
Agreement may not be assigned without the prior written consent of the other
parties to this Agreement. Notwithstanding the previous sentence, the Purchaser
may, without the consent of the Seller Group, assign its rights under this
Agreement to any lender of the Purchaser or to any Affiliate of the
Purchaser.

     14.4
Headings. The headings contained in this Agreement are
included for purposes of convenience only and shall not affect the meaning or
interpretation of this Agreement.

     14.5 Integration,
Modification and Waiver. This Agreement, together with the exhibits,
schedules and certificates or other instruments delivered under this Agreement,
constitutes the entire agreement between the parties with respect to the subject
matter of this Agreement and supersedes all prior understandings of the parties.
No supplement, modification or amendment of this Agreement shall be binding
unless executed in writing by each of the parties to this Agreement. No waiver
of any of the provisions of this Agreement shall be deemed to be or shall
constitute a continuing waiver. No waiver shall be binding unless executed in
writing by the party making the waiver.

     14.6
Construction. The parties have participated jointly in the
negotiation and drafting of this Agreement. In the event an ambiguity or
question of intent or interpretation arises, this Agreement shall be construed
as if drafted jointly by the parties and no presumption or burden of proof shall
arise favoring or disfavoring any party by virtue of the authorship of any of
the provisions of this Agreement. Any reference to any federal, state, local or
foreign statute or law shall be deemed also to refer to all rules and
regulations promulgated thereunder, unless the context requires otherwise. The
word “including” shall mean including without limitation. Any reference
to the singular in this Agreement shall also include the plural and vice
versa.

34

     14.7
Severability. If any provision of this Agreement or the
application of any provision of this Agreement to any party or circumstance
shall, to any extent, be adjudged invalid or unenforceable, the application of
the remainder of such provision to such party or circumstance, the application
of such provision to other parties or circumstances, and the application of the
remainder of this Agreement shall not be affected thereby.

     14.8
Notices. All notices and other communications required or
permitted under this Agreement must be in writing and will be deemed to have
been duly given (a) when delivered in person, (b) when dispatched by electronic
facsimile transfer (if confirmed in writing by mail simultaneously dispatched),
(c) one business day after having been dispatched by a nationally recognized
overnight courier service or (d) five business days after being sent by
registered or certified mail, return receipt requested, postage prepaid, to the
appropriate party at the address or facsimile number specified below:

	 	If to Sellers: 
	 	 	  
	 	 	  
	 	 	Astra Financial Services, Inc. 
	 	 	c/o WilliamsMcCarthy LLP 
	 	 	120 W. State Street, Suite 400 
	 	 	P.O. Box 219 
	 	 	Rockford, IL 61105 
	 	 	Attention: Scott C. Sullivan, Esq. 
	 	 	Facsimile : (815) 968-8656 
	 	 	  
	 	 	Calcars AB, Inc. 
	 	 	c/o WilliamsMcCarthy LLP 
	 	 	120 W. State Street, Suite 400 
	 	 	P.O. Box 219 
	 	 	Rockford, IL 61105 
	 	 	Attention: Scott C. Sullivan, Esq. 
	 	 	Facsimile : (815) 968-8656 
	 	 	  
	 	If to Shareholder:
  
	 	 	  
	 	 	John R. Calcott 
	 	 	c/o WilliamsMcCarthy LLP 
	 	 	120 W. State Street, Suite 400 
	 	 	P.O. Box 219 
	 	 	Rockford, IL 61105 
	 	 	Attention: Scott C. Sullivan, Esq. 
	 	 	Facsimile : (815) 968-8656 

35

	 	with a copy to: 
	 	 	  
	 	 	WilliamsMcCarthy, LLP 
	 	 	120 West State Street, Suite 400 
	 	 	P.O. Box 219 
	 	 	Rockford, IL 61105-0219 
	 	 	Attention: Scott C. Sullivan. Esq. 
	 	 	Facsimile: (815) 968-0019 
	 	 	  
	 	If to the Purchaser:
  
	 	 	  
	 	 	Carbiz Auto Credit AQ, Inc. 
	 	 	7405 N. Tamiami Trial 
	 	 	Sarasota, FL 34243 
	 	 	Attention: Mr. Stan Heintz, CFO 
	 	 	Facsimile: (941) 308-2718 
	 	 	  
	 	with a copy to: 
	 	 	  
	 	 	Shumaker, Loop & Kendrick, LLP 
	 	 	Suite 2800 
	 	 	101 East Kennedy Boulevard 
	 	 	Tampa, Florida 33602 
	 	 	Attention: Michael H. Robbins, Esq. 
	 	 	Facsimile: (813) 229-1660 

Any party may change its address or facsimile number for the
purposes of this Section 14.8 by giving notice as provided in this
Agreement.

     14.9 Governing Law;
Venue. This Agreement shall be governed by and construed in accordance
with the laws of the State of Florida and shall in all respects be interpreted,
enforced, and governed under the internal and domestic laws of such state,
without giving effect to the principles of conflicts of laws of such state. Each
of the parties submits to the exclusive jurisdiction of the U.S. District Court
for the Middle District of Florida, and the Circuit Court in and for
Hillsborough County, Florida, as the exclusive proper forum in which to
adjudicate any case or controversy arising hereunder.

     14.10 Entire
Agreement. This Agreement, together with all exhibits and
schedules attached hereto, represents the final, complete, and exclusive
expression of understanding between the parties with respect to the subject
matter hereof. All previous or contemporaneous agreements, understandings, or
representations between the parties, oral or written, are superseded by and
merged into this Agreement, including, but not limited to, the letter of intent
dated September 10, 2007, which is hereby terminated, except as set forth in
Section 13.1(b) herein.

36

     14.11 Attorney’s
Fees. In the event of any action or proceeding arising out of or
relating to this Agreement or the breach, termination, validity, interpretation,
or enforcement of this Agreement, the prevailing party shall be entitled to
recover all costs and reasonable attorneys’ fees incurred, including, without
limitation, costs and attorneys’ fees incurred in any investigations, trials,
bankruptcy or insolvency proceedings, and appeals.

     14.12
Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

[SIGNATURE PAGE FOLLOWS]

37

     IN WITNESS WHEREOF, the
parties have executed this Agreement as of the day and year first above
written.

	“Purchaser” 	“Seller
      Group” 
	 	 
	Carbiz Auto Credit AQ, Inc. 	Astra Financial
      Services, Inc. 
	 	 	 	 
	By:	 	 By: 	
	Name: 	      	 Name: 	       
	Title: 	         	 Title: 	       
	 	 	 	 
	 	  	Calcars AB, Inc. 
	 	 	 	 
	 	  	 By: 	
	 	  	 Name: 	 
    
	 	  	 Title: 	 
    
	 	  	 	  
	 	 	 	 
	 	  	 	John R. Calcott 

36

(SIGNATURE PAGE TO

ASSET PURCHASE
AGREEMENT)Filed by Automated Filing Services Inc. (604) 609-0244 - Carbiz, Inc. - Exhibit 10.2

 

 

 

AMENDED AND RESTATED 

  LOAN AND SECURITY AGREEMENT 

CARBIZ USA INC., 
CARBIZ AUTO CREDIT, INC., 
CARBIZ AUTO
CREDIT JV1, LLC, and 
CARBIZ AUTO CREDIT AQ, INC., 
as Borrowers, 

CARBIZ INC., 
as a Guarantor, 

SWC SERVICES LLC, 
as Initial Lender, 

THE OTHER LENDERS FROM TIME TO TIME PARTY HERETO, 

SWC SERVICES LLC, 
as Administrative Agent, 

and 

AGM, LLC, 
as Additional Collateral Agent 

$30,000,000 Revolving and Term Loan Facilities 

October 1, 2007 

TABLE OF CONTENTS

	 	 	  	Page 
	 	 	  	  
	ARTICLE 1 DEFINITIONS 	1 
	 	Section 1.1. 	DEFINITIONS 	1 
	 	Section 1.2. 	EXHIBITS AND SCHEDULES;
      ADDITIONAL DEFINITIONS 	14 
	 	Section 1.3. 	AMENDMENT OF DEFINED DOCUMENTS 	14 
	 	Section 1.4. 	REFERENCES AND TITLES 	14 
	 	 	  	  
	 ARTICLE 2 LOAN(S), INTEREST RATE AND OTHER CHARGES
      	15 
	 	Section 2.1. 	RECEIVABLES LOAN 	15 
	 	Section 2.2. 	INVENTORY LOAN 	16 
	 	Section 2.3. 	TERM LOAN 	18 
	 	Section 2.4. 	INTEREST RATE 	20 
	 	Section 2.5. 	PAYMENTS 	21 
	 	Section 2.6. 	PAYMENT DUE ON A NON-BUSINESS
      DAY 	21 
	 	Section 2.7. 	MANDATORY PAYMENTS 	21 
		Section 2.8. 	TERMINATION OF THE COMMITMENTS; VOLUNTARY PREPAYMENTS
      	21 
	 	Section 2.9. 	MAXIMUM INTEREST; CONTROLLING AGREEMENT
      	22 
	 	Section 2.10. 	INTEREST AFTER DEFAULT
      	24 
	 	Section 2.11.
      	APPLICATION OF PAYMENTS 	24 
	 	Section 2.12. 	FEES 	25 
	 	Section 2.13.
      	CAPITAL REIMBURSEMENT 	25 
	 	Section 2.14. 	[Reserved] 	26 
	 	Section 2.15.
      	TAXES 	26 
	 	 	  	  
	 ARTICLE 3 SECURITY
      	26 
	 	Section 3.1. 	SECURITY INTEREST
      	26 
		Section 3.2. 	COLLATERAL ASSIGNMENT OF CONSUMER LOAN
      DOCUMENTS AND AUTO TITLE 	28 
	 	Section 3.3. 	FINANCING STATEMENTS
      AND FURTHER ASSURANCES 	29 
		Section 3.4. 	DELIVERY OF RECEIVABLES; INSTRUMENTS,
      DOCUMENTS, ETC 	30 
	 	Section 3.5. 	FAILURE TO DELIVER
      	31 
		Section 3.6. 	NOTICE OF SECURITY INTEREST AND COLLATERAL
      ASSIGNMENT 	31 
	 	Section 3.7. 	RECORDS AND INSPECTIONS
      	31 
	 	Section 3.8. 	COLLECTION 	31 
	 	Section 3.9. 	COLLECTION ACCOUNT 	32 
		Section 3.10.
      	PROTECTION OF RECEIVABLE RECORDS AND
      MANAGEMENT OF RECEIVABLES INFORMATION 	33 
	 	Section 3.11. 	USE OF PROCEEDS 	33 
	 	Section 3.12.
      	RETURN OF COLLATERAL 	33 

i 

		Section 3.13. 	COLLATERAL REPRESENTATIONS, WARRANTIES, AND COVENANTS
      	34 
	 	Section 3.14.
      	LENDER'S PAYMENT OF CLAIMS 	36 
	 	 	  	  
	ARTICLE 4 CONDITIONS
      OF CLOSING; SUBSEQUENT ADVANCES 	36 
	 	Section 4.1. 	INITIAL ADVANCE 	36 
	 	Section 4.2. 	ALL ADVANCES 	39 
	 	Section 4.3. 	ALL ADVANCES TO CONSTITUTE
      ONE LOAN 	40 
	 	Section 4.4. 	ADVANCES 	40 
	 	 	  	  
	ARTICLE 5 REPRESENTATIONS
      AND WARRANTIES OF BORROWER AND RELATED PARTIES
      	40 
	 	Section 5.1. 	REPRESENTATIONS AND WARRANTIES 	40 
		Section 5.2. 	REPRESENTATIONS AND WARRANTIES AS TO
      ELIGIBLE RECEIVABLES 	44 
		Section 5.3. 	REPRESENTATIONS AND WARRANTIES AS TO ELIGIBLE INVENTORY
      	44 
	 	 	  	  
	ARTICLE 6 COVENANTS AND OTHER AGREEMENTS
      	45 
	 	Section 6.1. 	AFFIRMATIVE COVENANTS 	45 
	 	Section 6.2. 	NEGATIVE COVENANTS
      	48 
		Section 6.3. 	REPORTING REQUIREMENTS AND ACCOUNTING
      PRACTICES 	52 
	 	Section 6.4. 	ACCOUNT DEBTORS ADDRESSES
      	52 
	 	Section 6.5. 	FINANCIAL REPORTS 	52 
	 	Section 6.6. 	NOTICE OF CHANGES
      	54 
	 	Section 6.7. 	NOTICE OF COMMERCIAL TORT CLAIMS
      	55 
	 	Section 6.8. 	OUTSIDE DIRECTOR
      	55 
	 	Section 6.9. 	FINANCIAL COVENANTS	55 
	 	 	  	  
	ARTICLE 7 EVENTS OF
      DEFAULT AND REMEDIES 	58 
	 	Section 7.1. 	EVENTS OF DEFAULT
      	58 
	 	Section 7.2. 	ACCELERATION OF THE INDEBTEDNESS
      	61 
	 	Section 7.3. 	REMEDIES 	61 
	 	Section 7.4. 	NO WAIVER 	63 
	 	Section 7.5. 	APPLICATION OF PROCEEDS 	64 
		Section 7.6. 	APPOINTMENT OF ADMINISTRATIVE AGENT AS
      ATTORNEY-IN-FACT 	64 
	 	 	  	  
	ARTICLE 8 ADMINISTRATIVE
      AGENT; ASSIGNMENTS 	65 
	 	Section 8.1. 	APPOINTMENT 	65 
	 	Section 8.2. 	NATURE OF DUTIES 	65 
	 	Section 8.3. 	LACK OF RELIANCE ON THE
      ADMINISTRATIVE AGENT 	66 
	 	Section 8.4. 	CERTAIN RIGHTS OF THE ADMINISTRATIVE
      AGENT 	66 
	 	Section 8.5. 	RELIANCE 	66 
	 	Section 8.6. 	INDEMNIFICATION 	67 

ii 

	 	Section 8.7. 	HOLDERS 	67 
	 	Section 8.8. 	RESIGNATION BY THE ADMINISTRATIVE
      AGENT 	67 
	 	Section 8.9. 	RELEASE OF
      COLLATERAL 	68 
		Section 8.10.
      	CONFIRMATION OF AUTHORITY;
      EXECUTION OF RELEASES 	68 
	 	Section 8.11. 	ABSENCE OF
      DUTY 	68 
	 	Section 8.12.
      	AGENCY FOR PERFECTION
      	68 
	 	Section 8.13. 	AMENDMENTS, CONSENTS AND WAIVERS 	69 
	 	 		  
	ARTICLE 9 EXPENSES AND INDEMNITIES 	69 
	 	Section 9.1. 	PAYMENT FOR EXPENSES
      	69 
	 	Section 9.2. 	GENERAL INDEMNIFICATION
      	70 
	 	 	  	  
	ARTICLE 10 MISCELLANEOUS 	70 
	 	Section 10.1.
      	NOTICES 	70 
	 	Section 10.2. 	APPOINTMENT OF BORROWER REPRESENTATIVE 	71 
	 	Section 10.3.
      	ASSIGNMENTS AND PARTICIPATIONS
      	71 
	 	Section 10.4. 	SURVIVAL
      OF AGREEMENTS 	73 
	 	Section 10.5.
      	NO OBLIGATION BEYOND MATURITY
      	73 
	 	Section 10.6. 	PRIOR AGREEMENTS
      SUPERSEDED 	73 
	 	Section 10.7.
      	PARTIES BOUND 	73 
	 	Section 10.8. 	NO THIRD
      PARTY BENEFICIARY 	73 
	 	Section 10.9.
      	EXECUTION IN COUNTERPARTS
      	73 
	 	Section 10.10. 	SEVERABILITY OF PROVISIONS 	74 
	 	Section 10.11. 	FURTHER INSTRUMENTS
      	74 
	 	Section 10.12. 	GOVERNING LAW 	74 
	 	Section 10.13. 	JURISDICTION AND VENUE
      	74 
	 	Section 10.14. 	WAIVER 	74 
	 	Section 10.15. 	ADVICE OF COUNSEL
      	75 
	 	Section 10.16. 	WAIVER OF RIGHT TO TRIAL BY JURY 	75 
	 	Section 10.17. 	TIME OF ESSENCE
      	75 
	 	 		  
	ARTICLE 11 JOINT AND
      SEVERAL LIABILITY; CROSS GUARANTY; SUBORDINATION
      	77 
	 	Section 11.1. 	JOINT AND
      SEVERAL LIABILITY; CROSS GUARANTY. 	77 
	 	Section 11.2.
      	SUBORDINATION 	79 

iii 

Schedules and Exhibits

	Schedule
      A 
	Exhibit A – Request for Advance 
	Exhibit B – Request for Return of
      Collateral 
	Exhibit C – Availability Report 
	Exhibit D – Schedule of Receivables and
      Assignment 
	Exhibit E – Compliance Certificate 
	Exhibit
      F-1 – Form of Receivable Note 
	Exhibit
      F-2 – Form of Inventory Note 
	Exhibit
      F-3 – Form of Term Note 
	Exhibit G – Loss to Liquidation Report 
	Exhibit H – Static Pool Report
  

i 

AMENDED AND RESTATED

LOAN AND SECURITY AGREEMENT

THIS AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT
(this “Agreement”) dated as of October 1, 2007 is entered into by and
among (a) CARBIZ USA INC., a Delaware corporation (“Carbiz USA”), CARBIZ
AUTO CREDIT, INC., a Florida corporation (“Carbiz Auto”), CARBIZ AUTO
CREDIT JV1, LLC, a Florida limited liability company (“Carbiz LLC”), and
CARBIZ AUTO CREDIT AQ, INC., a Florida corporation (“Carbiz AQ”; Carbiz
USA, Carbiz Auto, Carbiz LLC and Carbiz AQ are sometimes referred to herein
individually as a “Borrower” and, collectively, as the
“Borrowers”), (b) CARBIZ INC., an Ontario corporation (“Carbiz
Parent”), as a Guarantor (as defined below), (c) SWC SERVICES LLC, a
Delaware limited liability company, for itself as a lender (the “Initial
Lender”), (d) the other Lenders (as defined below) from time to time party
hereto, (e) SWC SERVICES LLC, a Delaware limited liability company, as
administrative agent for the Lenders (in such capacity, the “Administrative
Agent”) and (f) AGM, LLC, a Delaware limited liability company, as
additional collateral agent for the Lenders (in such capacity, the
“Additional Collateral Agent”). 

ARTICLE 1 
DEFINITIONS 

          Section
1.1.      DEFINITIONS.
As used in this Agreement, each of the following terms has the meaning given to
such term in this Section 1.1 or in the schedules, sections and subsections
referred to below. 

          ACCOUNT.
The term “Account” shall have the meaning given to such term in the UCC. 

          ACCOUNT
CONTROL AGREEMENT. The term “Account Control Agreement” shall mean those
certain Account Control Agreements between one or more Related Parties,
Administrative Agent or Additional Collateral Agent, as applicable, and the
banking institutions listed on Schedule A (or such other banking institutions at
which a Related Party opens a deposit account from time to time in accordance
with the terms hereof), pursuant to which the Administrative Agent or Additional
Collateral Agent, as applicable, establishes “control” over the subject accounts
therein of such Related Parties, in accordance with the UCC. 

          ACCOUNT
DEBTOR. The term “Account Debtor” shall mean any Person that is an obligor
(including without limitation any co-signor) in respect of any Receivable. 

          ACT.
The term “Act” shall mean the United States Securities Act of 1933, as amended.

          ADDITIONAL
SUMS. The term “Additional Sums” shall have the meaning given to such term
in Section 2.9(b) of this Agreement. 

          AFFILIATE.
The term “Affiliate” shall mean, with respect to any Person (i) any Person that
directly or indirectly controls such Person, (ii) any Person which is controlled
by or is under common control with such controlling Person, (iii) each of such
Person's officers or directors (or 

Persons functioning in substantially similar roles) and the
spouses, parents, descendants and siblings of such officers, directors or other
Persons. As used in this definition, the term “Control” of a Person means the
possession, directly or indirectly, of the power to vote five percent (5%) or
more of any class of voting securities of such Person or to direct or cause the
direction of the management or policies of a Person, whether through the
ownership of voting securities, by contract or otherwise. 

          AGING
PROCEDURES. The term “Aging Procedures” shall have the meaning set forth in
Section 1.1(a)(i) of Schedule A attached hereto. 

          AGREEMENT.
The term “Agreement” shall mean this Amended and Restated Loan and Security
Agreement by and among the Lenders, the Administrative Agent, the Additional
Collateral Agent, the Borrowers and the Guarantors party hereto, and any
amendment, supplement, restatement, modifications or extension hereof. 

          AMOUNT
OF INVENTORY CREDIT LINE. The term “Amount of Inventory Credit Line” shall
mean Two Million and No/100 Dollars ($2,000,000.00) .

          AMOUNT
OF RECEIVABLES CREDIT LINE. The term “Amount of Receivables Credit Line”
shall mean Twenty-Three Million and No/100 Dollars ($23,000,000.00) .

          APPLICABLE
STATED INTEREST RATE. The term “Applicable Stated Interest Rate” shall mean,
with respect to the Receivables Loan, the Inventory Loan and the Term Loan, the
“Receivable Stated Rate”, the “Inventory Stated Rate”, and the “Term Loan Stated
Rate,” respectively, and, with respect to all other Indebtedness, the Receivable
Stated Rate. 

          APPLICABLE
USURY LAW. The term “Applicable Usury Law” shall mean all federal and state
usury Laws applicable to the Loans, the Indebtedness, this Agreement and the
other Loan Documents. 

          APPROVED
STATE. The term “Approved State” shall have the meaning set forth in Section
1.1(a)(ii) of Schedule A attached hereto. 

          ASSET
PURCHASE AGREEMENT. The term “Asset Purchase Agreement” shall mean that
certain Asset Purchase Agreement dated as of October 1, 2007 by and among Carbiz
AQ, Astra Financial Services, Inc., a Nevada corporation, Calcars AB, Inc., an
Illinois corporation, and John R. Calcott, an individual. 

          ASSIGNEE.
The term “Assignee” shall have the meaning set forth in Section 10.3(b) hereof.

          ASSIGNMENT
AND ACCEPTANCE. The term “Assignment and Acceptance” shall mean an
Assignment and Acceptance Agreement executed pursuant to the terms of Section
10.3 hereof, in a form reasonably acceptable to Administrative Agent and the
parties thereto. 

          AUTO
TITLE. The term “Auto Title” shall mean the certificate of title issued by
the department of transportation or other corresponding instrumentality or
agency of any state that 

2 

relates to an automobile or other vehicle which is collateral
for a Receivable or constiututes Automobile Inventory, as applicable. 

          AUTOMOBILE
INVENTORY. The term “Automobile Inventory” shall mean all automobiles, light
trucks and other vehicles owned by the Borrowers. 

          AVAILABILITY
ON ELIGIBLE INVENTORY. The term “Availability on Eligible Inventory” shall
have the meaning set forth in Section 2.2(a)(ii) of Schedule A attached hereto.

          AVAILABILITY
ON ELIGIBLE RECEIVABLES. The term “Availability on Eligible Receivables”
shall have the meaning set forth in Section 2.1(a)(ii) of Schedule A attached
hereto. 

          AVAILABILITY
REPORT. The term “Availability Report” shall mean an Availability Report in
the form of Exhibit C attached hereto. 

          BORROWER
REPRESENTATIVE. The term “Borrower Representative” shall mean Carbiz USA, in
its capacity as Borrower Representative pursuant to Section 10.2 hereof. 

          BUSINESS
DAY. The term “Business Day” shall mean a day, other than a Saturday or
Sunday, on which commercial banks are open for business to the public in
Chicago, Illinois. 

          CALCOTT
AUTOMOBILE INVENTORY. The term “Calcott Automobile Inventory” shall mean the
Automobile Inventory that originally was the subject of Consumer Loan Documents
acquired by Carbiz AQ pursuant to the Asset Purchase Agreement and subsequently
repossessed or otherwise reacquired by Carbiz AQ after the date hereof.

          CARBIZ
AQ CUSTODIAN AGREEMENT. The term “Carbiz AQ Custodian Agreement” shall mean
that certain Custodial Agreement dated as of April 11, 2006 (and amended as of
the date hereof pursuant to the First Amendment to Custodial Agreement dated as
of the date hereof among Administrative Agent, Additional Collateral Agent, The
Calcott Companies, Inc., Astra Financial Services, Inc., Calcars AB, Inc.,
Borrowers and CAR Financial Services, Inc., as Custodian) among Borrowers,
Administrative Agent, Additional Collateral Agent and the Custodian party
thereto, as the same may be amended, supplemented, restated or otherwise
modified in accordance with the terms thereof. 

          CLOSING
DATE. The term “Closing Date” shall mean October 1, 2007. 

          CODE.
The term “Code” shall mean the United States Internal Revenue Code of 1986, as
amended from time to time. 

          COLLATERAL.
The term “Collateral” shall have the meaning set forth in Section 3.1. hereof.

          COLLECTION
ACCOUNT. The term “Collection Account” shall mean any of the deposit
accounts set forth in Section 3.9 of Schedule A attached hereto held in the name
of Administrative Agent or Additional Collateral Agent, as applicable, or any
such other account as 

3 

may be designated to the Borrowers by Administrative Agent or
Additional Collateral Agent in writing from time to time upon not less than two
(2) Business Days prior written notice. 

          COMMITMENT
FEE. The term “Commitment Fee” shall have the meaning for such term set
forth in Section 2.12 of this Agreement. 

          COMMONLY
CONTROLLED ENTITY. The term “Commonly Controlled Entity” shall mean an
entity, whether or not incorporated, which is under common control with any
Related Party or Validity Guarantor within the meaning of Section 414(b) or (c)
of the Code. 

          CONSUMER
LOAN DOCUMENTS. The term “Consumer Loan Documents” shall mean all promissory
notes, chattel paper, retail installment contracts, security agreements or other
similar documents, agreements, instruments and writings evidencing or securing a
Receivable which have been executed by an Account Debtor and any guarantor of
the related Receivable and are payable to or in favor of a Borrower. 

          CUSTODIAL
CERTIFICATE. The term “Custodial Certificate” shall have the meaning for
such term set forth in the Custodian Agreements. 

          CUSTODIAN.
The term “Custodian” shall mean (i) LaSalle Bank, NA, and its successors and
permitted assigns, in connection with the Existing Carbiz Custodian Agreement
and (ii) CAR Financial Services, Inc., and its successors and assigns, in
connection with the Carbiz AQ Custodian Agreement. 

          CUSTODIAN
AGREEMENT. The term “Custodian Agreement” means the Existing Carbiz
Custodian Agreement or the Carbiz AQ Custodian Agreement, as the context
requires, and “Custodian Agreements” means the Existing Carbiz Custodian
Agreement and the Carbiz AQ Custodian Agreement collectively.

          DEFAULT.
The term “Default” shall mean an event which with the passage of time or notice
or both would constitute an Event of Default. 

          DEFAULT
  RATE. The term “Default Rate” shall have the meaning for such
  term set forth in Section 2.10 of this Agreement.

          DISTRIBUTION.
The term “Distribution” shall mean, during any period of determination, (i) any
dividends or other distribution of earnings to any Related Party’s shareholders,
members or equity holders, (ii) the net increase in the outstanding balance of
all obligations or indebtedness due from any Related Party’s shareholders,
members or equity holders to such Related Party and (iii) the net decrease in
the outstanding balance of all obligations or indebtedness due from any Related
Party to such Related Party’s shareholders, members or equity holders. 

          DOLLARS.
The term “Dollars” and the symbol “$” shall mean the lawful currency of the
United States of America. 

4 

          EBITDA.
The term “EBITDA” shall mean, for any period of determination, all earnings of
Carbiz Parent and its consolidated Subsidiaries for said period
before (a) all interest and tax obligations for said period, (b) depreciation
for said period, and (c) amortization for said period, determined in accordance
with GAAP on a consistent basis with the latest financial statements of Carbiz
Parent and its consolidated Subsidiaries, but excluding the effect of
extraordinary or non-reoccurring gains or losses for such period. 

          ELIGIBLE
INVENTORY. The term “Eligible Inventory” shall have meaning for such term
set forth in Section 1.1(b) of Schedule A attached hereto. 

          ELIGIBLE
RECEIVABLES. The term “Eligible Receivables” shall have the meaning for such
term set forth in Section 1.1(a)(iii) of Schedule A attached hereto. 

          ERISA.
The term “ERISA” shall mean the United States Employee Retirement Income
Security Act of 1974, as amended from time to time. 

          EVENT
OF DEFAULT. The term “Event of Default” shall have the meaning given to such
term in Section 7.1. 

          EXISTING
CARBIZ CUSTODIAN AGREEMENT. The term “Existing Carbiz Custodian Agreement”
shall mean that certain Custodial Agreement dated as of March 23, 2007 among
certain of the Borrowers, Administrative Agent and the Custodian party thereto,
as the same may be amended, supplemented, restated or otherwise modified in
accordance with the terms thereof. 

          EXISTING
CARBIZ LOAN AGREEMENT. The term “Existing Carbiz Loan Agreement” shall mean
that certain Loan and Security Agreement dated as of March 23, 2007, as amended,
restated, supplemented or otherwise modified from time to time immediately prior
to the effectiveness of this Agreement, by and among Carbiz USA, Carbiz Auto and
Carbiz LLC, as “Borrowers” thereunder, Carbiz Parent, as a “Guarantor”
thereunder, SWC Services LLC, as the “Administrative Agent” thereunder and the
“Lenders” party thereto. 

          FIRST
INTEREST RATE INCREASE PERIOD. The term “First Interest Rate Increase
Period” shall mean the period commencing October 1, 2008 and continuing through
January 31, 2009.

          GAAP.
The term “GAAP” shall mean generally accepted accounting principles and other
standards as promulgated by the American Institute of Certified Public
Accountants. 

          GUARANTOR.
The term “Guarantor” shall mean Carbiz Parent and each other Person or Persons
(other than a Validity Guarantor or JV Partner) who now or hereafter execute a
Guaranty Agreement in favor of Administrative Agent, for the benefit of the
Lender Parties, with respect to all or any part of the Indebtedness. 

          GUARANTY
AGREEMENT. The term “Guaranty Agreement” shall mean (i) that certain
Guaranty and Security Agreement dated as of March 23, 2007 by Carbiz Parent
in favor of Administrative Agent for the benefit of the Lender Parties, (ii)
that certain Limited Recourse 

5 

Guaranty and Pledge Agreement dated as of March 23, 2007 by the
JV Partner in favor of Administrative Agent for the benefit of the Lender
Parties, (iii) each Validity Guaranty, and (iv) each other guaranty of all or
part of the Indebtedness from time to time executed by a Guarantor in favor of
Administrative Agent, for the benefit of the Lender Parties, in each case, in
form and substance satisfactory to Administrative Agent. 

          INDEBTEDNESS.
The term “Indebtedness” shall mean all amounts advanced hereunder by Lenders to
Borrowers together with all other amounts owing or becoming owing to any Lender
Party by any Borrower, any Guarantor, any Validity Guarantor or any other
Related Party under or pursuant to the Loan Documents, whether direct or
indirect, absolute or contingent, now or hereafter existing. 

          INTEREST
  COVERAGE RATIO. The term “Interest Coverage Ratio” shall mean,
  at any time of determination, the ratio of Carbiz Parent’s and its
  consolidated Subsidiaries’ EBITDA divided by Carbiz Parent’s and
  its consolidated Subsidiaries’ Interest Expense, in each case for the immediately
  preceding two (2) calendar month period.

          INTEREST
EXPENSE. The term “Interest Expense” shall mean, during the period of
determination, the total interest expense of Carbiz Parent and its
consolidated Subsidiaries, including, without limitation, all interest paid or
accrued with respect to (a) the Loans and all other outstanding Indebtedness,
(b) the Trafalgar Subordinated Debt and (c) the Management Subordinated Debt;
provided, that, notwithstanding the foregoing, interest on the Trafalgar
Subordinated Debt and/or Management Subordinated Debt paid by the issuance of
equity of Carbiz Parent pursuant to the terms of the Trafalgar Subordinated Debt
Documents or Management Subordinated Debt Documents (and not in cash) shall not
be deemed to constitute interest expense for the purpose hereof. 

          INVENTORY
ADVANCE RATE. The term “Inventory Advance Rate” shall have the meaning set
forth in Section 2.2(a)(ii) of Schedule A attached hereto.

          INVENTORY
LOAN ADVANCE. The term “Inventory Loan Advance” shall have the meaning given
to such term in Section 2.2(a) hereof. 

          INVENTORY
NOTE. The term “Inventory Note” shall mean, individually and collectively,
any promissory note of Borrowers issued to Initial Lender (or subsequently
reissued by the Borrowers to an assignee of Initial Lender pursuant to Section
10.3 hereof) in respect of an Inventory Loan hereunder, as such promissory note
may be amended, modified, supplemented or restated from time to time, and any
substitutions for or renewals of such promissory note. 

          INVENTORY
PURCHASER. The term “Inventory Purchaser” shall mean any Person that
purchases Automobile Inventory from a Borrower. 

         INVENTORY
STATED RATE. The term “Inventory Stated Rate” shall mean twelve percent
(12%) per annum. 

6 

          ITEMS.
The term “Items” shall mean all cash payments, checks, drafts, or similar items
of payment upon and/or proceeds of the Receivables and/or Automobile Inventory.

          JV
PARTNER. The term “JV Partner” shall mean JonRoss Inc., a Florida
corporation.

          LANDLORD
WAIVERS. The term “Landlord Waivers” shall mean all waivers, consents,
agreements for quiet attornment, collateral access agreements and other
agreements with lessors of Borrowers, as may be required by Administrative Agent
and each in form and substance satisfactory to Administrative Agent. 

          LAW.
The term “Law” shall mean any statute, law, regulation, ordinance, rule, treaty,
judgment, order, decree, permit, concession, franchise, license, agreement or
other governmental restriction of the United States or any state or political
subdivision thereof or of any foreign country (including, without limitation,
Canada) or any department, state, province or other political subdivision
thereof. 

          LENDER.
The term “Lender” shall mean each of the Initial Lender and its permitted
assigns pursuant to Section 10.3 of this Agreement, and the successors thereof.

          LENDER
PARTIES. The term “Lender Parties” shall mean Administrative Agent,
Additional Collateral Agent and all Lenders. 

          LEVERAGE
  RATIO. The term “Leverage Ratio” shall mean, on any date of determination,
  an amount equal to the ratio of: (a) the amount of the total Liabilities of
  Carbiz Parent and its consolidated Subsidiaries on such date, including the
  outstanding balance of the Indebtedness, divided by (b) the amount of Carbiz
  Parent’s and its consolidated Subsidiaries’ Tangible Net Worth.

          LIABILITIES.
The term “Liabilities” shall mean, as to any Person, all indebtedness,
liabilities and obligations of such Person, whether matured or unmatured,
liquidated or unliquidated, primary or secondary, direct or indirect, absolute,
fixed or contingent, and whether or not required to be considered pursuant to
GAAP. 

          LIEN.
The term “Lien” shall mean, with respect to any property or assets, any right or
interest therein of a creditor to secure Liabilities owed to it or any other
arrangement with such creditor which provides for the payment of such
Liabilities out of such property or assets or which allows such creditor to have
such Liabilities satisfied out of such property or assets prior to the general
creditors of any owner thereof, including any lien, mortgage, security interest,
pledge, deposit, rights of a vendor under any title retention or conditional
sale agreement or lease substantially equivalent thereto, tax lien, mechanic’s
or materialman’s lien, or any other charge or encumbrance for security purposes,
whether arising by Law or agreement or otherwise, but excluding any right of
offset which arises without agreement in the ordinary course of business. “Lien”
also includes any financing statement, any registration of a pledge (such as
with an issuer of uncertificated securities), or any other arrangement or action
which would serve to perfect a Lien described in the preceding sentence,
regardless of whether such financing statement is filed, such registration is
made, or such arrangement or action is undertaken before or after such Lien
exists. 

7 

          LIQUIDATED
DAMAGES. The term “Liquidated Damages” shall have the meaning set forth in
Section 2.8 of Schedule A attached hereto. 

          LOANS.
The term “Loans” shall mean, collectively, the Receivables Loans, the Inventory
Loans and the Term Loan. 

          LOAN
ADVANCE. The term “Loan Advance” shall mean, individually and collectively,
each Inventory Loan Advance, each Receivables Loan Advance and each advance of
the Term Loan hereunder. 

          LOAN
DOCUMENTS. The term “Loan Documents” shall mean this Agreement, the Notes,
each Guaranty Agreement, each Pledge Agreement, each Security Agreement, the
Subordination Agreement(s), the Custodian Agreements, the Account Control
Agreements, and all other documents, instruments, writings and other agreements
executed in connection with this Agreement, together with any and all renewals,
amendments, restatements or replacements thereof and all exhibits, schedules and
annexes thereto. 

          LOSS
TO LIQUIDATION RATIO. The term “Loss to Liquidation Ratio” shall mean, as of
any date of determination, a percentage equal to (i) the amount of Receivables
which became charged-off receivables during the period of 3 to 12 consecutive
calendar months then most recently ended less recoveries of any cash or
equivalent for wholesale value for vehicles resold during such period with
respect to any charged-off receivables, divided by (ii) the aggregate amount of
collections (payments and payoffs) and charged-off receivables, before
recoveries of cash or equivalents, during such corresponding 3 to 12 month
period. 

          LOT
CODE. The term “Lot Code” shall mean the identification codes applied to
Borrower’s Receivables and Automobile Inventory pursuant to the software system
used by Borrower for the purpose of monitoring Receivables and Automobile
Inventory. 

          MANAGEMENT
SUBORDINATED DEBT. The term “Management Subordinated Debt” shall mean the
Liabilities of Carbiz Parent to the Management Subordinated Lenders pursuant to
the Management Subordinated Debt Documents, the principal amount of which shall
not exceed $800,000 at any time (plus interest capitalized or paid in kind
pursuant to the terms thereof). 

          MANAGEMENT
SUBORDINATED DEBT DOCUMENTS. The term “Management Subordinated Debt
Documents” shall mean a collective reference to the Secured Convertible
Debentures dated on or about October 1, 2007 issued by Carbiz Parent to the
Management Subordinated Lenders and each other document and agreement executed
and delivered in connection therewith. 

         MANAGEMENT
SUBORDINATED LENDERS. The term “Management Subordinated Lenders” shall mean,
collectively, the members of management of Carbiz Parent and its Subsidiaries
and the other Persons issued Secured Convertible Debentures on the date hereof
constituting Management Subordinated Debt Documents, together with their
permitted successors and assigns pursuant to the terms of the Management
Subordination Agreement. 

8 

          MANAGEMENT
SUBORDINATION AGREEMENT. The term “Management Subordination Agreement” shall
mean that certain Subordination and Intercreditor Agreement dated on or about
October 1, 2007 by and among Administrative Agent, Additional Collateral Agent,
the Borrowers, the Guarantors and the Management Subordinated Lenders, as the
same may be amended, supplemented or otherwise modified in accordance with the
terms thereof. 

          MATURITY
DATE. The term “Maturity Date” shall mean (i) for the Receivables Loan and
the Inventory Loan, October 1, 2011 and (ii) for the Term Loan, April 1, 2011.

          MAXIMUM
AGGREGATE CREDIT LINE. The term “Maximum Aggregate Credit Line” shall mean
Thirty Million and No/100 Dollars ($30,000,000.00) . 

          MAXIMUM
AMOUNT OF AN ELIGIBLE RECEIVABLE. The term “Maximum Amount of an Eligible
Receivable” shall have the meaning set forth in Section 1.1(a)(iv) of Schedule A
attached hereto. 

          MAXIMUM
RATE. The term “Maximum Rate” shall mean the highest lawful and nonusurious
rate of interest that at any time or from time to time may be contracted for,
taken, reserved, charged, or received on the Notes and the Indebtedness under
Applicable Usury Law. 

          MAXIMUM
TERM OF AN ELIGIBLE RECEIVABLE. The term “Maximum Term of an Eligible
Receivable” shall have the meaning set forth in Section 1.1(a)(v) of Schedule A
attached hereto. 

          MORTGAGES.
The term “Mortgages” shall mean those certain mortgages or deeds of trust
executed by each Related Party that owns any real estate being mortgaged to the
Administrative Agent or Additional Collateral Agent, for the benefit of the
Lender Parties, in form and substance reasonably satisfactory to Administrative
Agent or Additional Collateral Agent, as applicable. 

          NET
INCOME. The term “Net Income” shall mean, with respect to any period, the
net earnings of Carbiz Parent and its consolidated Subsidiaries
(excluding all extraordinary gains or nonrecurring income) before provision for
income taxes for such period, all as reflected on the financial statements of
Carbiz Parent and its consolidated Subsidiaries supplied to
Administrative Agent pursuant to Section 6.5 hereof. 

          NOTES.
The term “Notes” shall mean, individually and collectively, the Receivables
Note, the Inventory Note and the Term Note. 

          OPERATING
ACCOUNT. The term “Operating Account” shall mean the deposit accounts of a
Borrower identified in Section 2.1(c) of Schedule A hereto, together with any
replacement deposit accounts subject to an Account Control Agreement from time
to time identified by the Borrower Representative to Administrative Agent in
writing. 

          OUTSIDE
DIRECTOR. The term “Outside Director” shall have the meaning given to such
term is Section 6.8. 

9 

          PATRIOT
ACT. The term “Patriot Act” shall mean the Uniting and Strengthening America
by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act
of 2001, P.L. 107-56, as amended. 

          PERSON.
The term “Person” shall mean an individual, partnership, corporation, limited
liability company, limited liability partnership, joint venture, joint stock
company, association, trust, unincorporated organization or any other entity or
organization, including without limitation a government or agency or political
subdivision thereof. 

          PLAN.
The term “Plan” shall mean any pension plan that is covered by Title IV of ERISA
and with respect to which Borrower or a Commonly Controlled Entity is an
“Employer” as defined in Section 3(5) of ERISA. 

          PLEDGE
AGREEMENT. The term “Pledge Agreement” shall mean, collectively, those
certain pledge agreements dated as of the date hereof by each of Carbiz Parent,
Carbiz USA, and Carbiz Auto in favor of Administrative Agent, for the benefit of
the Lender Parties, together with each other pledge agreement from time to time
executed by a Related Party in favor of Administrative Agent or Additional
Collateral Agent, for the benefit of the Lender Parties, securing all or any
part of the Indebtedness. 

          RECEIVABLE
STATED RATE. The term “Receivable Stated Rate” shall mean twelve percent
(12%) per annum. 

          RECEIVABLES.
The term “Receivables” shall mean all Accounts of the Borrowers and any other
right of a Borrower to receive payment, including, without limitation, all
loans, extensions of credit or a Borrower’s right to payment for goods sold or
services rendered by such Borrower. 

          RECEIVABLES
ADVANCE RATE. The term “Receivables Advance Rate” shall have the meaning set
forth in Section 2.1(a)(ii) of Schedule A attached hereto.

          RECEIVABLES
LOAN ADVANCE. The term “Receivables Loan Advance” shall have the meaning
given to such term in Section 2.1(a) . 

          RECEIVABLES
NOTE. The term “Receivables Note” shall mean, individually and collectively,
any promissory note of the Borrowers issued to Initial Lender (or subsequently
reissued by the Borrowers to an assignee of Initial Lender pursuant to Section
10.3 hereof) in respect of a Receivables Loan hereunder, as such promissory note
may be amended, modified, supplemented or restated from time to time, and any
substitutions for or renewals of such promissory note. 

          RELATED
PARTY. The term “Related Party” shall mean, collectively, each Borrower,
each Guarantor, each Subsidiary of a Borrower and/or Carbiz Parent and each
Subsidiary and/or Affiliate of a Borrower and/or a Guarantor that is a party to
this Agreement or any other Loan Document (other than a Validity Guarantor or JV
Partner).

10 

          REQUEST
FOR ADVANCE. The term “Request for Advance” shall mean a written request for
an advance in the form of Exhibit A attached hereto and made a part
hereof. 

          REQUIRED
  LENDERS. The term “Required Lenders” shall mean, at any one time,
  any group of Lenders holding commitments to make Receivables Loan Advances and
  Inventory Loan Advances, together with the principal amount of the Term Loan,
  which constitute a majority of the then aggregate outstanding commitments to
  make Receivables Loan Advances and Inventory Loan Advances and the principal
  amount of the Term Loan; provided that if the commitments to make Receivables
  Loan Advances and Inventory Loan Advances have terminated or expired, then “Required
  Lenders” shall mean, at any one time, any group of Lenders holding the
  principal amount of Loans which constitute a majority of the then aggregate
  outstanding principal amount of the Loans.

          SCHEDULE
A. The term “Schedule A” shall mean Schedule A of this Agreement of even
date herewith executed by the Borrowers, as amended, supplemented or restated
from time to time, upon written agreement of Administrative Agent, Required
Lenders and the Borrowers. 

          SCHEDULE
OF RECEIVABLES AND ASSIGNMENT. The term “Schedule of Receivables and
Assignment” shall mean an assignment in the form and substance of Exhibit
D attached hereto. 

          SECOND
INTEREST RATE INCREASE PERIOD. The term “Second Interest Rate Increase
Period” shall mean the period commencing February 1, 2009 and continuing through
July 31, 2009. 

          SECURITY
AGREEMENTS. The term “Security Agreements” shall mean each security
agreement from time to time executed by a Related Party in favor of
Administrative Agent OR Additional Collateral Agent, for the benefit of the
Lender Parties, securing all or any part of the Indebtedness. 

          SID/GPS
DEVICE. The term “SID/GPS Device” shall mean a starter interrupt / GPS
tracking device of a type satisfactory to Administrative Agent.

          STATIC
POOL. The term “Static Pool” shall mean a series of consumer loans
underwritten with the same criteria during the same month, quarter, or year.

          SUBORDINATED
DEBT. The term “Subordinated Debt” shall mean the aggregate amount of any
Liabilities of any Related Party to any Person that are issued in an amount and
on terms and conditions acceptable to Administrative Agent and Lenders and
subordinated in all respects, including, but not limited to, the right of
payment, to the prior payment in full of the Indebtedness pursuant to a
Subordination Agreement, in each case, in form and substance satisfactory to
Administrative Agent. Trafalgar Subordinated Debt and Management Subordinated
Debt shall be deemed to be Subordinated Debt. 

          SUBORDINATION
AGREEMENT. The term “Subordination Agreement” shall mean, collectively, the
Trafalgar Subordination Agreement, the Management Subordination Agreement and
each other subordination and intercreditor agreement executed by a holder of
Subordinated 

11 

Debt in favor of Administrative Agent and the Lenders, which
Subordination Agreement is in form and substance satisfactory to the
Administrative Agent in its sole discretion. 

          SUBSIDIARY.
The term “Subsidiary” shall mean, with respect to any Person, (i) any
corporation of which an aggregate of more than fifty percent (50%) of the
outstanding capital stock having ordinary voting power to elect a majority of
the board of directors of such corporation (irrespective of whether, at the
time, capital stock of any other class or classes of such corporation shall have
or might have voting power by reason of the happening of any contingency) is at
the time, directly or indirectly, owned legally or beneficially by such Person
or one or more Subsidiaries of such Person, or with respect to which any such
Person has the right to vote or designate the vote of more than fifty percent
(50%) of such capital stock whether by proxy, agreement, operation of law or
otherwise, and (ii) any partnership or limited liability company in which such
Person and/or one or more Subsidiaries of such Person shall have an interest
(whether in the form of voting or participation in profits or capital
contribution) of more than fifty percent (50%) or of which any such Person is a
general partner or may exercise the powers of a general partner. Unless the
context otherwise requires, each reference to a Subsidiary shall be a reference
to a Subsidiary of a Borrower. For purposes of the Loan Documents, Carbiz LLC
shall at all times be deemed a Subsidiary of Carbiz USA. 

          TANGIBLE
NET WORTH. The term “Tangible Net Worth” shall mean, at any time of
determination, an amount equal to (a) the shareholder's equity of Carbiz
Parent and its consolidated Subsidiaries on such date, determined in
accordance with GAAP, minus (b) the aggregate amount on such date of all
intangible assets and all assets consisting of obligations due to Carbiz
Parent and its consolidated Subsidiaries from shareholders, directors,
officers, any Guarantor or any Affiliate of a Borrower or a Guarantor hereunder
(other than Carbiz Parent and its Subsidiaries themselves). 

          TERM
AMORTIZATION BALANCE. The term “Term Amortization Balance” shall mean the
outstanding principal balance of the Term Loan as of 5:00 p.m. (Chicago,
Illinois time) on April 30, 2010.

          TERM
LOAN. The term “Term Loan” shall have the meaning set forth in Section 2.3
hereof. 

          TERM
NOTE. The term “Term Note” shall mean, individually and collectively, any
promissory note of Borrowers issued to Initial Lender (or subsequently re-issued
by the Borrowers to an assignee of Initial Lender pursuant to Section 10.3
hereof) in respect of the Term Loan hereunder, as such promissory note may be
amended, modified, supplemented or restated from time to time, and any
substitutions for or renewals of such promissory note. 

          TERM
LOAN STATED RATE. The term “Term Loan Stated Rate” shall mean twelve percent
(12%) per annum. 

          TERMINATION
DATE. The term “Termination Date” shall have the meaning given to such term
in Section 2.8 of this Agreement. 

12 

          TERMINATION
NOTICE. The term “Termination Notice” shall have the meaning given to such
term in Section 2.8 of this Agreement. 

          THIRD
INTEREST RATE INCREASE PERIOD. The term “Third Interest Rate Increase
Period” shall mean the period commencing August 1, 2009 and continuing through
January 31, 2010. 

          TRAFALGAR
  SUBORDINATED DEBT. The term “Trafalgar Subordinated Debt” shall
  mean a collective reference to the Liabilities of Carbiz Parent to the Trafalgar
  Subordinated Lenders pursuant to the Trafalgar Subordinated Debt Documents,
  the principal amount of which shall not exceed (i) $2,500,000 with respect to
  the Trafalgar Subordinated Debt Documents described in clause (i) of the definition
  thereof, (ii) $1,000,000 with respect to the Trafalgar Subordinated Debt Documents
  described in clause (ii) of the definition thereof and (iii) $1,500,000 with
  respect to the Trafalgar Subordinated Debt Documents described in clause (iii)
  of the definition thereof, in each case plus interest capitalized or paid in
  kind pursuant to the terms thereof.

          TRAFALGAR
SUBORDINATED DEBT DOCUMENTS. The term “Trafalgar Subordinated Debt
Documents” shall mean a collective reference to (i) that certain Securities
Purchase Agreement dated as of February 28, 2007 between Carbiz Parent and the
Trafalgar Subordinated Lenders, each Secured Convertible Debenture issued by
Carbiz Parent thereunder and each other document and agreement executed and
delivered in connection therewith, (ii) that certain Securities Purchase
Agreement dated as of August 31, 2007 between Carbiz Parent and the Trafalgar
Subordinated Lenders, each Secured Convertible Debenture issued by Carbiz Parent
thereunder and each other document and agreement executed and delivered in
connection therewith and (ii) that certain Securities Purchase Agreement dated
as of September 26, 2007 between Carbiz Parent and the Trafalgar Subordinated
Lenders, each Secured Convertible Debenture issued by Carbiz Parent thereunder
and each other document and agreement executed and delivered in connection
therewith. 

          TRAFALGAR
SUBORDINATED LENDERS. The term “Trafalgar Subordinated Lenders” shall mean,
collectively, Trafalgar Capital Specialized Investment Fund, Luxembourg, a
Luxembourg SICAV fund, together with its permitted successors and assigns
pursuant to the terms of the Trafalgar Subordination Agreement. 

          TRAFALGAR
SUBORDINATION AGREEMENT. The term “Trafalgar Subordination Agreement” shall
mean that certain Subordination and Intercreditor Agreement dated as of March
23, 2007 by and among Administrative Agent, the Borrowers, the Guarantors and
the Trafalgar Subordinated Lenders, as the same may be amended, supplemented or
otherwise modified in accordance with the terms thereof. 

          UCC.
The term “UCC” shall mean the Uniform Commercial Code as in effect in the State
of Illinois. 

          UNDERWRITING
GUIDELINES. The term “Underwriting Guidelines” shall mean the Borrowers’
customary credit and underwriting guidelines as of the date hereof, a copy of
which 

13 

has been delivered to Administrative Agent, as such guidelines
are amended from time to time; provided that such amendments have been approved
by Administrative Agent and Required Lenders in writing. 

          VALIDITY
GUARANTOR. The term “Validity Guarantor” shall mean each of Carl W. Ritter,
Ross Richard Lye and Stanton C. Heintz. 

          VALIDITY
GUARANTY. The term “Validity Guaranty” shall mean each Limited Validity
Guaranty by the Validity Guarantors in favor of Administrative Agent for the
benefit of the Lender Parties. 

          VOLUNTARY
TERMINATION. The term “Voluntary Termination” shall have the meaning given
to such term in Section 2.8 of this Agreement. 

          Section
1.2.      EXHIBITS AND
SCHEDULES; ADDITIONAL DEFINITIONS. All Exhibits and Schedules
attached to this Agreement are a part hereof for all purposes. Reference is
hereby made to Schedule A for the meaning of certain terms defined therein and
used but not defined herein, which definitions are incorporated herein by
reference. All terms defined in the UCC and not otherwise defined herein
(including, without limitation, certificated security, chattel paper, commercial
tort claims, deposit accounts, documents, equipment, fixtures, general
intangibles, goods, instruments, inventory, investment property,
letter-of-credit rights, supporting obligations, uncertificated security and
proceeds) shall have the meanings assigned to them in the UCC.

          Section
1.3.      AMENDMENT OF DEFINED
DOCUMENTS. Unless the context otherwise requires or unless
otherwise provided herein the terms defined in this Agreement which refer to a
particular agreement, instrument or document also refer to and include all
renewals, extensions, modifications, amendments and restatements of such
agreement, instrument or documents provided that nothing contained in this
Section shall be construed to authorize any such renewal, extension,
modification, amendment or restatement. 

          Section
1.4.      REFERENCES AND
TITLES. All references in this Agreement to Exhibits, Schedules,
articles, sections, subsections and other subdivisions refer to the Exhibits,
Schedules, articles, sections, subsections and other subdivisions of this
Agreement unless expressly provided otherwise. Exhibits and Schedules to any
Loan Document shall be deemed incorporated by reference in such Loan Document.
References to any document, instrument, or agreement (a) shall include all
exhibits, schedules and other attachments thereto and (b) shall include all
documents, instruments or agreements issued or executed in replacement thereof.
Titles appearing at the beginning of any subdivisions are for convenience only
and do not constitute any part of such subdivisions and shall be disregarded in
construing the language contained in such subdivisions. The words “this
Agreement”, “herein”, “hereof”, “hereby”, “hereunder” and words of similar
import refer to this Agreement as a whole and not to any particular subdivision
unless expressly so limited. The phrases “this section” and “this subsection”
and similar phrases refer only to the sections or subsections hereof in which
such phrases occur. The word “or” is not exclusive, and the word “including” (in
its various forms) means “including without limitation”. References to “days”
shall mean calendar days unless the 

14 

term Business Day is used. Unless otherwise specified,
references herein to any particular Person also refer to its successors and
permitted assigns. The meanings of defined terms shall be equally applicable to
the singular and plural forms of the defined terms. 

ARTICLE 2 
LOAN(S), INTEREST RATE AND OTHER CHARGES

          Section
2.1.      RECEIVABLES
LOAN. 

                    (a)     
Subject to the terms, covenants and conditions hereinafter set forth (including,
without limitation, the terms set forth in Schedule A attached hereto),
Initial Lender agrees to, upon the Borrower Representative’s request from
time to time (but in no event more often than, together with any Inventory Loan
Advances made pursuant to Section 2.2, one (1) time per week), until the
Maturity Date, to make loans to the Borrowers (collectively, the “Receivables
Loan” and each advance thereof a “Receivables Loan Advance”), in an
aggregate amount (including accrued but unpaid interest thereon) not to exceed
at any time outstanding the lesser of the following: (i) the Amount of
Receivables Credit Line as in effect from time to time or (ii) the Availability
on Eligible Receivables. In no event shall Initial Lender be required to fund
Receivables Loan Advances if after giving effect to any Receivables Loan Advance
either (i) the aggregate amount of the outstanding Receivables Loan would exceed
the Amount of Receivables Credit Line then in effect or (ii) the aggregate
amount of the Loan Advances would exceed the Maximum Aggregate Credit Line.
Within the limits of this Section 2.1, Borrowers may borrow, repay and reborrow
the Receivables Loan. 

                    (b)     
The obligation of the Borrowers to repay to a Lender the aggregate amount of
each Receivables Loan Advance made by such Lender (whether directly or as
assignee of another Lender), together with interest accruing in connection
therewith, shall be evidenced by a Receivables Note in substantially the form of
Exhibit F-1 attached hereto and made a part hereof, issued in the
principal amount of such Receivables Loan Advance and dated the date on which
the proceeds of such Receivables Loan Advance are advanced hereunder to or for
the account of the Borrowers. The amount of principal owing on any Receivables
Note at any given time shall be the aggregate amount of the Receivables Loan
Advance evidenced thereby minus all payments of principal theretofore received
by the Administrative Agent on such Receivables Note. Interest on each
Receivables Note shall accrue and be due and payable as provided herein and
therein. Each Receivables Note shall be due and payable as provided herein and
therein and the principal amount of the Loan Advance evidenced thereby, together
with all accrued and unpaid interest thereon, shall be due and payable in full
on the Maturity Date applicable to the Receivables Loan and Borrowers jointly
and severally unconditionally promise to pay each Receivables Note and the
outstanding Receivables Loan and all other outstanding Indebtedness, to the
extent not earlier paid in full pursuant to the terms of the Loan Documents, in
full on the Maturity Date applicable to the Receivables Loan. 

                    (c)      The
Borrower Representative, on behalf of itself and the other Borrowers, will make
a request for a Receivables Loan Advance to the Administrative Agent in such
manner as the Administrative Agent may from time to time prescribe. Each
Receivables Loan Advance, combined with any Inventory Loan Advance made on the
same date, shall be in a minimum 

15 

amount of $100,000. In the absence of any such further
direction from the Administrative Agent and subject to the provisions hereof,
the Borrowers shall request a Receivables Loan Advance by having the Borrower
Representative submit such request in the form of Exhibit A attached
hereto (each such request, a “Request for Advance”) and an Availability
Report to the Administrative Agent, together with such other information as the
Administrative Agent reasonably requests in accordance with the terms hereof,
and must be given so as to be received by the Administrative Agent not later
than 2:00 p.m. (Chicago time) on the second Business Day prior to the requested
funding date of such proposed Receivables Loan Advance. Each Request for Advance
shall specify such information as Administrative Agent may reasonably request,
in each case in form and substance reasonably acceptable to Administrative
Agent. Each Request for Advance shall be deemed a representation and warranty by
each Borrower that (i) all conditions precedent specified in Article IV hereof
with respect to such Receivables Loan Advance are satisfied on the date of such
request and (ii) no breach or default under, and no Event of Default defined or
described in, this Agreement or any of the Loan Documents exists or, after
giving effect to the Receivables Loan Advance requested pursuant to such Request
for Advance, will exist. Unless otherwise requested in writing by the Borrower
Representative and agreed by Administrative Agent and the Required Lenders, each
Receivables Loan Advance shall be funded by the Lenders by wire transfer to the
Operating Account pursuant to the wire transfer instructions set forth on
Section 2.1(c) of Schedule A hereto.

          Section
2.2.      INVENTORY
LOAN. 

                    (a)     
Subject to the terms, covenants and conditions hereinafter set forth (including,
without limitation, the terms set forth in Schedule A attached hereto),
Initial Lender agrees to, upon the Borrower’s request from time to time
(but in no event more often than, together with any Receivables Loan Advances
made pursuant to Section 2.1, one (1) time per week), until the Maturity Date,
to make loans to the Borrowers (collectively, the “Inventory Loan”
and each advance thereof an “Inventory Loan Advance”), in an aggregate
amount (including accrued but unpaid interest thereon) not to exceed at any time
outstanding the lesser of the following: (i) the Amount of Inventory Credit Line
as in effect from time to time or (ii) the Availability on Eligible Inventory.
In no event shall Initial Lender be required to fund Inventory Loan Advances if
after giving effect to any Inventory Loan Advance either (i) the aggregate
amount of the outstanding Inventory Loan would exceed the Amount of Inventory
Credit Line then in effect or (ii) the aggregate amount of the Loan Advances
would exceed the Maximum Aggregate Credit Line. Within the limits of this
Section 2.2, Borrowers may borrow, repay and reborrow the Inventory Loan. 

                    (b)      The
obligation of the Borrowers to repay to a Lender the aggregate amount of each
Inventory Loan Advance made by such Lender (whether directly or as assignee of
another Lender), together with interest accruing in connection therewith, shall
be evidenced by an Inventory Note in substantially the form of Exhibit
F-2 attached hereto and made a part hereof, issued in the principal amount
of such Inventory Loan Advance and dated the date on which the proceeds of such
Inventory Loan Advance are advanced hereunder to or for the account of the
Borrowers. The amount of principal owing on any Inventory Note at any given time
shall be the aggregate amount of the Inventory Loan Advances evidenced thereby
minus all payments of principal theretofore received by the Administrative Agent
on such Inventory Note.

16 

Interest on each Inventory Note shall accrue and be due and
payable as provided herein and therein. Each Inventory Note shall be due and
payable as provided herein and therein and the principal amount of the Inventory
Loan Advance evidenced thereby, together with all accrued and unpaid interest
thereon, shall be due and payable in full on the Maturity Date applicable to the
Inventory Loan and Borrowers jointly and severally unconditionally promise to
pay each Inventory Note and the outstanding Inventory Loan and all other
outstanding Indebtedness, to the extent not earlier paid in full pursuant to the
terms of the Loan Documents, in full on the Maturity Date applicable to the
Inventory Loan. 

                    (c)      The
Borrower Representative, on behalf of itself and the other Borrowers, will make
a request for an Inventory Loan Advance to the Administrative Agent in such
manner as the Administrative Agent may from time to time prescribe. Each
Inventory Loan Advance, combined with any Receivable Loan Advance made on the
same date, shall be in a minimum amount of $100,000. In the absence of any such
further direction from the Administrative Agent and subject to the provisions
hereof, the Borrowers shall request an Inventory Loan Advance by having the
Borrower Representative submit a Request for Advance and an Availability Report
to the Administrative Agent, together with such other information as the
Administrative Agent reasonably requests in accordance with the terms hereof,
and must be given so as to be received by the Administrative Agent not later
than 2:00 p.m. (Chicago time) on the second Business Day prior to the requested
funding date of such proposed Inventory Loan Advance. Each Request for Advance
shall specify such information as Administrative Agent may reasonably request,
in each case in form and substance acceptable to Administrative Agent. Each
Request for Advance shall be deemed a representation and warranty by each
Borrower that (i) all conditions precedent specified in Article IV hereof with
respect to such Inventory Loan Advance are satisfied on the date of such request
and (ii) no breach or default under, and no Event of Default defined or
described in, this Agreement or any of the Loan Documents exists or, after
giving effect to the Inventory Loan Advance requested pursuant to such Request
for Advance, will exist. Unless otherwise requested in writing by the Borrower
Representative and agreed by Administrative Agent and the Required Lenders, each
Inventory Loan Advance shall be funded by the Lenders by wire transfer to the
Operating Account described as the “Primary Operating Account” on Section 2.1(c)
of Schedule A hereto pursuant to the wire transfer instructions set forth on
Section 2.1(c) of Schedule A hereto or to another Operating Account if so
requested in writing by Borrower Representative. 

                    (d)      Administrative
Agent has been advised by Borrowers that they intend to establish an Operating
Account (the “Inventory Operating Account”) for the sole purpose of
holding funds to be used by Borrowers to acquire Automobile Inventory, pay for
costs and expenses associated with detailing, reconditioning and otherwise
preparing Automobile Inventory for resale and pay for costs and expenses
relating to the installation of SID/GPS Devices in Automobile Inventory (each of
the foregoing, a “Permitted Use”). Borrowers hereby represent, warrant
and covenant that they will not use proceeds on deposit in the Inventory
Operating Account for any purpose other than a Permitted Use and will not
maintain funds on deposit in the Inventory Operating Account in excess of
$350,000 in the aggregate at any time. Upon the opening of the Inventory
Operating Account (but only to the extent same is covered by an Account Control
Agreement in favor of Administrative Agent and Additional Collateral Agent),
Borrowers shall be permitted to request an Inventory Loan Advance (without
regard to 

17 

Availability on Eligible Inventory at such time) of up to
$350,000 and, so long as all conditions to funding such Inventory Loan Advance
are satisfied (without regard to Availability on Eligible Inventory), Lenders
shall fund their pro rata share of such requested Inventory Loan Advance to the
Inventory Operating Account (it being agreed to and understood that the request
for an Inventory Loan Advance pursuant to this Section 2.2(d) shall not count
against the limitation on the number of Loan Advance requests that can be made
per week set forth in Sections 2.1(a) and 2.2(a) hereof). Upon opening the
Inventory Operating Account Borrowers shall promptly update Schedule A hereto to
reflect such new deposit account of the Borrowers. On the first Business Day of
each week Borrower Representative shall deliver to Administrative Agent a report
in form and detail reasonably acceptable to Administrative Agent describing the
amounts of all Permitted Uses funded with proceeds on deposit in the Inventory
Operating Account during the prior week. If Borrower delivers to Administrative
Agent a properly completed Request for Advance, then, so long as all conditions
set forth in this Agreement relating to the funding of Inventory Loan Advances
are satisfied before and after giving effect to such Inventory Loan Advance,
Lenders shall, in accordance with all other terms of this Agreement relating to
the funding of Inventory Loan Advances, fund to the Inventory Operating Account
an amount equal to (i) $350,000 less (ii) the aggregate amount of Permitted Uses
for the preceding week.

          Section
2.3.      TERM
LOAN. 

                    (a)      Subject
to the terms, covenants and conditions hereinafter set forth, Initial
Lender agrees to, on the Closing Date, make a term loan to the Borrowers in
an original principal amount equal to Eighteen Million Five Hundred Fifty-Nine
Thousand Seven Hundred Eight and 87/100 Dollars ($18,559,708.87) (the “Term
Loan”). Amounts of the Term Loan which are repaid or prepaid may not be
reborrowed.

                    (b)      The
obligation of the Borrowers to repay to a Lender the portion of the Term Loan
made by such Lender (whether directly or as assignee of another Lender),
together with interest accruing in connection therewith, shall be evidenced by a
Term Note in substantially the form of Exhibit F-3 attached hereto and
made a part hereof, issued in the principal amount of such Lender’s portion of
the Term Loan and dated the date hereof. The amount of principal owing on any
Term Note at any given time shall be the aggregate amount of the Term Loan
evidenced thereby minus all payments of principal theretofore received by the
Administrative Agent on such Term Note. Interest on each Term Note shall accrue
and be due and payable as provided herein and therein. All outstanding principal
and all accrued but unpaid interest on Term Loan shall be due and payable on the
Maturity Date applicable to the Term Loan. Borrowers jointly and severally
unconditionally promise to pay each Term Note and the outstanding principal
balance of the Term Loan in full on the Maturity Date applicable to the Term
Loan. 

                    (c)      Borrowers
may request that Lenders holding portions of the Term Loan make additional
advances under the Term Loan in the aggregate amount of Three Million Three
Hundred Twenty-Five Thousand and No/100 Dollars ($3,325,000.00), which advances
shall constitute a portion of the outstanding principal balance of the Term Loan
for all purposes hereunder and under the other Loan Documents (such additional
advances of the Term Loan, the “Additional Term Loan Advances”). Each
Lender shall fund its pro rata share (based on such 

18 

Lender’s percentage interest of the aggregate outstanding
principal balance of the Term Loan) of each Additional Term Loan Advance
requested by Borrowers by wire transfer to an Operating Account designated by
Borrower Representative pursuant to the wire transfer instructions set forth on
Section 2.1(c) of Schedule A hereto applicable to such Operating Account. In
addition to the foregoing, requests for Additional Term Loan Advances (and
Lenders’ obligations to fund same) shall be subject to the following terms and
conditions: (i) no such request shall be made if an Event of Default under any
of Sections 7.1(a), 7.1(b), 7.1(c) (with respect to Section 7.1(c), as a result
of a breach of Sections 6.2(a), 6.2(f), 6.2(n) or 6.2(o) only), 7.1(g), 7.1(h),
7.1(i) or 7.1(n) has occurred and is continuing or would arise after giving
effect to such Additional Term Loan Advance (and no Lender shall be obligated to
fund an Additional Term Loan Advance if any such Event of Default has occurred
and is continuing), (ii) Additional Term Loan Advances shall only be funded in
two (2) draws of up to $2,000,000 on November 1, 2007 and $1,000,000 on January
2, 2008 (provided up to an additional $325,000 may be borrowed on the November
1, 2007 draw date if the proceeds thereof are used to fund the Distribution
permitted under Section 6.2(o)(iii) hereof), and (iii) a request for an
Additional Term Loan Advance shall be made in writing to Administrative Agent in
form and substance reasonably acceptable to Administrative Agent and must be
given so as to be received by the Administrative Agent not later than 2:00 p.m.
(Chicago time) on the second Business Day prior to the applicable funding date
of such proposed Additional Term Loan Advance in accordance with the immediately
preceding clause (ii). Any Lender funding an Additional Term Loan Advance may
request a new Term Note in order to evidence its funding of such Additional Term
Loan Advance. Lenders’ commitment to fund Additional Term Loan Advances
hereunder shall immediately and irrevocably terminate on January 2, 2008 (after
giving effect to any funding of an Additional Term Loan Advance on such date in
accordance with this Section 2.3(c)) . Notwithstanding anything to the contrary
contained herein, Lenders shall not be obligated to fund Additional Term Loan
Advances if after giving effect thereto the aggregate outstanding principal
balance of the Loan Advances would exceed the Maximum Aggregate Credit Line.

                    (d)      In
addition to any other amounts required to be repaid or prepaid on the Term Loan
pursuant to the terms of this Agreement, Borrower agrees to repay the
outstanding principal balance of the Term Loan in equal monthly installments on
the dates and in the amounts set forth below: 

	 	  	Term Loan 
	 	Payment Date 	Installment Amount 
	 	  	 
	 	May 1, 2010 	1/12 of the Term Amortization
      Balance 
	 	June 1, 2010 	1/12 of the Term Amortization Balance 
	 	July 1, 2010 	1/12 of the Term Amortization
      Balance 
	 	August 1, 2010 	1/12 of the Term Amortization Balance 
	 	September 1, 2010 	1/12 of the Term Amortization
      Balance 
	 	October 1, 2010 	1/12 of the Term Amortization Balance 
	 	November 1, 2010 	1/12 of the Term Amortization
      Balance 
	 	December 1, 2010 	1/12 of the Term Amortization Balance 
	 	January 1, 2011 	1/12 of the Term Amortization
      Balance 
	 	February 1, 2011 	1/12 of the Term Amortization Balance
  

19 

	 	March 1, 2011 	1/12 of the Term Amortization
      Balance 
	 	April 1, 2011 	1/12 of the Term Amortization Balance
  

          Section
2.4.      INTEREST
RATE.

                    (a)      Unless
the Default Rate shall apply, the outstanding principal balance of each Loan
shall bear interest at the Applicable Stated Interest Rate on each day
outstanding. If any Lender is ever prevented from charging or collecting
interest at the Applicable Stated Interest Rate on all or a portion of the
Indebtedness because interest at such rate would exceed the Maximum Rate, then
the interest rate applicable to such Indebtedness to such Lender shall be the
Maximum Rate until such Lender has charged and collected the full amount of
interest chargeable and collectable had the Applicable Stated Interest Rate
always been lawfully chargeable and collectible. Accrued but unpaid interest for
each calendar month during the term hereof shall be due and payable, in arrears,
on the fifth (5th) day of the immediately succeeding calendar month.

                    (b)      The
monthly interest due on the principal balance of the Loans outstanding shall be
computed for the actual number of days elapsed during the month in question on
the basis of a year consisting of three hundred sixty (360) days and shall be
calculated by determining the average daily principal balance outstanding for
each day of the month in question. The daily rate shall be equal to 1/360th
times the Applicable Stated Interest Rate (but shall not exceed the Maximum
Rate). 

                    (c)      Notwithstanding
anything to the contrary contained herein, (i) the Term Loan Stated Rate shall
automatically increase by six percent (6%) per annum on October 1, 2008, (ii)
the Term Loan Stated Rate shall automatically increase by an additional three
percent (3%) per annum on February 1, 2009, (iii) the Term Loan Stated Rate
shall automatically increase by an additional three percent (3%) per annum on
August 1, 2009, (iv) the Term Loan Stated Rate shall automatically increase to
an amount equal to twenty-eight percent (28%) per annum on February 1, 2010 and
(v) on each August 1 and February 1 thereafter, commencing August 1, 2010, the
Term Loan Stated Rate shall automatically increase by an additional three
percent (3%) per annum until the Term Loan is paid in full. All interest that
accrues at the Term Loan Stated Rate in excess of twelve percent (12%) per annum
(exclusive of any increases to the Term Loan Stated Rate as a result of interest
accruing at the Default Rate) as a result of the preceding sentence prior to
February 1, 2010 (the “Deferred Term Loan Interest”) shall be due and
payable on February 1, 2010 (and on each regularly scheduled payment dates of
interest hereunder thereafter); provided that Lenders hereby agree that (A) the
Term Loan Stated Rate shall be twelve percent (12%) per annum during the First
Interest Rate Increase Period for the period thereof when the outstanding
principal balance of the Term Loan is less than $7,500,000, (B) the Term Loan
Stated Rate shall be twelve percent (12%) per annum during the Second Interest
Rate Increase Period for the period thereof when the outstanding principal
balance of the Term Loan is less than $4,000,000, and (C) the Term Loan Stated
Rate shall be twelve percent (12%) per annum during the Third Interest Rate
Increase Period for the period thereof when the outstanding principal balance of
the Term Loan is less than $2,000,000.

20 

          Section
2.5.      PAYMENTS.
All payments on the Indebtedness shall be made by wire transfer or other method
of electronic transfer acceptable to Administrative Agent and shall be made to:

Banco Popular 
Rosemont, Illinois
USA 
ABA No.: 071924458 
For: SWC Carbiz 
Account No.: 68043234182 

Or such other account as may be designated to Borrower
Representative by Administrative Agent in writing from time to time, and at
least two (2) days prior to such payment being due and payable hereunder (such
account, the “Payment Account”), and all such payments shall be without
set-off, deduction, or counterclaim for the account of the Lender Parties. All
payments received pursuant to this Agreement by wire transfer or other
electronic transfer method, where immediate credit occurs, shall be applied to
the Indebtedness on the Business Day of actual receipt of such payment in the
Payment Account by Administrative Agent’s depository bank; provided, however,
for purposes of calculating the interest due on the outstanding principal
balance of the Loan, such payment is subject to a four (4) Business Day
clearance period. 

          Section
2.6.      PAYMENT DUE ON A
NON-BUSINESS DAY. If any payment of the Indebtedness falls due on a
day other than a Business Day, then such due date shall be extended to the next
succeeding Business Day. 

          Section
2.7.      MANDATORY
PAYMENTS. Provided that a Default or Event of Default has not
otherwise occurred and be continuing hereunder, if at any time (i) the aggregate
outstanding amount of the Receivables Loan advanced hereunder by Lenders to
Borrowers exceeds the maximum amount of the Receivables Loan allowed pursuant to
Section 2.1(a) (a “Receivables Overadvance”), or (ii) the aggregate
outstanding amount of the Inventory Loan advanced hereunder by Lenders to
Borrowers exceeds the maximum amount of the Inventory Loan allowed pursuant to
Section 2.2(a) (an “Inventory Overadvance”), Borrowers shall immediately
and without notice, repay to Administrative Agent, for the account of Lenders,
an amount sufficient to eliminate any such excess. In the event a Borrower
sells, transfers, assigns or otherwise disposes of all or any portion of its
Receivables or Automobile Inventory, other than in the ordinary course of
business (subject, at all times, to the restrictions set forth in Section 6.2(c)
of this Agreement), Borrowers shall apply all proceeds of any such sale,
transfer, assignment or other disposition to reduce the outstanding balance of
the Indebtedness (with such proceeds, in the case of a sale of Receivables,
shall be applied first to the Receivables Loan, and proceeds of the sale of
Automobile Inventory to be applied first to the Inventory Loan (unless such
Automobile Inventory constitutes Calcott Automobile Inventory, in which case the
proceeds of such sale shall be applied first to the Term Loan)).

          Section
2.8.      TERMINATION OF THE
COMMITMENTS; VOLUNTARY PREPAYMENTS.

21 

                    (a)     
Borrowers may, at any time, terminate financing under this Agreement and prepay
the Indebtedness in full (a “Voluntary Termination”) by providing
Administrative Agent and Lenders with written notice (the “Termination
Notice”) at least sixty (60) calendar days prior to the specific date upon
which Borrowers intend to cease financing hereunder and prepay the Indebtedness
in full (the “Termination Date”), and Lenders shall cease making advances
under this Agreement and all Indebtedness shall be immediately due and payable
upon the earlier of the applicable Maturity Date or the Termination Date, as
applicable. In connection with a Voluntary Termination, the Indebtedness owing
and to be paid by Borrowers to Administrative Agent for the account of Lender
Parties on the Termination Date shall include as liquidated damages, and not as
a penalty, the amount of liquidated damages (“Liquidated Damages”)
set forth in Section 2.8 of Schedule A attached hereto. Notwithstanding
any other provision of any Loan Document, no termination of financing under this
Agreement shall affect Lender Parties’ rights or any of the Indebtedness
existing as of the Termination Date, and the provisions of the Loan Documents
shall continue to be fully operative until all Indebtedness (other than
indemnity obligations under the Loan Documents that are not then due and payable
or for which any events or claims that would give rise thereto are not then
pending) have been fully performed and indefeasibly paid in cash in full. The
Liens granted to Administrative Agent and Additional Collateral Agent for the
benefit of the Lender Parties under the Loan Documents and the financing
statements filed pursuant thereto and the rights and powers of Administrative
Agent, Additional Collateral Agent and Lenders thereunder shall continue in full
force and effect until (a) all of the Indebtedness (other than indemnity
obligations under the Loan Documents that are not then due and payable or for
which any events or claims that would give rise thereto are not then pending)
has been fully performed and indefeasibly paid in full in cash, and (b) this
Agreement and the financing commitments under this Agreement have been
terminated, as provided herein. Administrative Agent hereby agrees to give
Borrower written confirmation of the amount of the Indebtedness (presuming no
further Loan Advances prior to the Termination Date) in a timely fashion
following receipt of a Termination Notice.

                    (b)     
Borrowers may from time to time, with at least two (2) Business Days prior
written notice to Administrative Agent by the Borrower Representative, prepay a
portion of the outstanding principal amount of any Loan designated by the
Borrower Representative; provided that any such prepayment shall be in an
amount equal to $100,000 or a higher integral multiple of $25,000 (or such
lesser amount as may be the remaining outstanding principal balance of such
Loan), and provided further, that any such prepayment received upon the
occurrence and during the continuance of a Default or Event of Default may be
applied to the Indebtedness at the discretion of Administrative Agent in
accordance with Section 2.11 hereof. 

          Section
2.9.      MAXIMUM INTEREST;
CONTROLLING AGREEMENT.

                   (a)      The
contracted for rate of interest of each Loan, without limitation, shall consist
of the following: (i) the Applicable Stated Interest Rate, calculated and
applied to the principal balance of the applicable Note in accordance with the
provisions of the applicable Note and this Agreement; (ii) additional interest
charged when the Default Rate is charged pursuant to the terms hereof,
calculated and applied to the amounts due under the applicable Note in
accordance with the provisions of the applicable Note and this Agreement; and
(iii) all 

22 

Additional Sums, if any. Borrowers agree to pay an effective
contracted for rate of interest which is the sum of the above-referenced
elements. 

                    (b)      All
fees, charges, goods, things in action or any other sums or things of value
(other than amounts described in the immediately previous paragraph), paid or
payable by Borrowers (collectively, the “Additional Sums”), whether
pursuant to the Notes, this Agreement or any other documents or instruments in
any way pertaining to this lending transaction, or otherwise with respect to
this lending transaction, that under any applicable Law may be deemed to be
interest with respect to this lending transaction, for the purpose of any
applicable Law that may limit the maximum amount of interest to be charged with
respect to this lending transaction, shall be payable by Borrowers as, and shall
be deemed to be, additional interest and for such purposes only, the agreed upon
and “contracted for rate of interest” of this lending transaction shall be
deemed to be increased by the rate of interest resulting from the inclusion of
the Additional Sums. 

                    (c)     
It is the intent of the parties to comply with Applicable Usury Law.
Accordingly, it is agreed that notwithstanding any provisions to the contrary in
the Loan Documents, or in any of the documents securing payment hereof or
otherwise relating hereto, in no event shall the Loan Documents or such other
documents require the payment or permit the collection of interest in excess of
the Maximum Rate permitted by Applicable Usury Law. In the event (i) any such
excess of interest otherwise would be contracted for, charged or received from
Borrowers or otherwise in connection with the Loans or other Indebtedness, or
(ii) the Maturity Date is accelerated in whole or in part, or (iii) all or part
of the principal or interest of the Loans shall be prepaid, so that under any of
such circumstances the amount of interest contracted for, charged or received in
connection with the Loans, would exceed the Maximum Rate permitted by Applicable
Usury Law, then in any such event (1) the provisions of this paragraph shall
govern and control, (2) neither any Borrower, any Guarantor nor any other Person
now or hereafter liable for the payment of any Indebtedness will be obligated to
pay the amount of such interest to the extent that it is in excess of the
Maximum Rate, (3) any such excess which may have been collected shall be either
applied as a credit against the then unpaid principal amount of the Indebtedness
or refunded to Borrowers, at Lenders' option, and (4) the effective rate of
interest will be automatically reduced to the Maximum Rate. It is further
agreed, without limiting the generality of the foregoing, that to the extent
permitted by Applicable Usury Law, (i) all calculations of interest which are
made for the purpose of determining whether such rate would exceed the Maximum
Rate shall be made by amortizing, prorating, allocating and spreading during the
period of the full stated term of the Loans, all interest at any time contracted
for, charged or received from Borrowers or otherwise in connection with the
Loans; and (ii) in the event that the effective rate of interest on the Loans
should at any time exceed the Maximum Rate, such excess interest that would
otherwise have been collected had there been no ceiling imposed by Applicable
Usury Law shall be paid to Administrative Agent, for the benefit of the Lender
Parties, from time to time, if and when the effective interest rate on the Loans
otherwise falls below the Maximum Rate, to the extent that interest paid to the
date of calculation does not exceed the Maximum Rate, until the entire amount of
interest which would have otherwise been collected had there been no ceiling
imposed by Applicable Usury Law has been paid in full. Borrowers further agree
that should the Maximum Rate be increased at any time hereafter because of a
change in the Law, then to the extent not prohibited by Applicable Usury Law,
such 

23 

increases shall apply to all Indebtedness evidenced hereby
regardless of when incurred; but, again to the extent not prohibited by
Applicable Usury Law, should the Maximum Rate be decreased because of a change
in the Law, such decreases shall not apply to the Indebtedness evidenced hereby
regardless of when incurred. 

          Section
2.10.      INTEREST AFTER
DEFAULT. Upon the occurrence and during the continuation of an
Event of Default, and without notice or demand to Borrowers, Borrowers shall pay
interest on the daily outstanding balance of the Loans at a rate per annum which
is six percent (6%) in excess of the Applicable Stated Interest Rate (the
“Default Rate”); provided, however, the Default Rate shall never exceed
the Maximum Rate.

          Section
2.11.      APPLICATION OF
PAYMENTS. The amount of all payments to or amounts received by
Administrative Agent consisting of the proceeds of Receivables (including
proceeds in respect of Eligible Receivables and payments received in the
Collection Accounts pursuant to Section 3.9 hereof) shall be applied to the
extent applicable under this Agreement: 

                              (i)     
first, to any fees and expenses due to Lender Parties hereunder; 

                              (ii)     
then, to any fees and expenses (including, without limitation, any legal fees
and expenses) of either Custodian; 

                              (iii)      then,
to any fees and expenses (including, without limitation, any legal fees and
expenses) of any third party back-up servicer (if applicable) of the
Receivables; 

                              (iv)      then,
to accrued and unpaid interest through the date of such payment (other than
interest accrued on account of the Term Loan), including any interest calculated
at the Default Rate in accordance with Section 2.8 hereof; 

                              (v)     
then, to the unpaid principal balance of the Receivables Loans and the Inventory
Loans, as applicable, in an amount sufficient to cure any Receivables
Overadvance or Inventory Overadvance; 

                              (vi)      then,
to the unpaid principal balance of the Receivables Loan; 

                              (vii)      then,
to the unpaid principal balance of the Inventory Loan; 

                              (viii)     
then, to accrued and unpaid interest on account of the Term Loan (but not
accrued and unpaid Deferred Term Loan Interest until after January 31, 2010);

                              (ix)     
then, if on or after May 1, 2010, to all or any portion of the Term Loan which
is due and unpaid or past-due; and 

24 

                              (x)     
last, so long as no Default or Event of Default shall have occurred and be
continuing, the remaining balance, if any, shall be transferred to the Operating
Account for the benefit of the Borrowers; 

provided, however, that if such Receivables are on account of
Consumer Loan Documents acquired by Carbiz AQ pursuant to the Asset Purchase
Agreement, or such Receivables (or any other proceeds) arise from the sale of
Calcott Automobile Inventory (whether or not in the ordinary course of
business), the proceeds of such Receivables (and any other proceeds from such
sale of Calcott Automobile Inventory) shall be applied to the Indebtedness in
the following order of priority: first pursuant to clause (i) above, then
pursuant to clause (ii) above, then pursuant to clause (iii) above, then
pursuant to clause (viii) above, then to the outstanding principal balance of
the Term Loan (applied to the remaining scheduled installments thereof in
inverse order of maturity if such application is made on or after May 1, 2010),
then pursuant to clause (iv) above, then pursuant to clause (v) above, then
pursuant to clause (vi) above, then pursuant to clause (vii) above, and last
pursuant to clause (x) above; provided, further, that upon the occurrence and
during the continuance of an Event of Default, any and all proceeds of
Receivables shall be applied to the Indebtedness in such order of priority as
Administrative Agent in its sole discretion may determine. 

In calculating interest and applying payments as set forth
above; (a) interest shall be calculated and collected through the date a payment
is actually applied thereto under the terms of this Agreement; (b) interest on
the outstanding balance shall be charged during any grace period permitted
hereunder; (c) on the sixth (6th) day of each calendar month, at
Administrative Agent’s option, all accrued and unpaid interest and other charges
provided for hereunder as of the last day of the preceding calendar month shall
be added to the principal balance of the applicable Loans; and (d) to the extent
that any Borrower, any other Related Party, JV Partner or a Validity Guarantor
makes a payment or any Lender Party receives any payment or proceeds of the
Collateral for Borrowers’ benefit that is subsequently invalidated, set aside or
required to be repaid to any other Person, then, to such extent, the obligations
intended to be satisfied shall be revived and continue as if such payment or
proceeds had not been received by such Lender Party and the outstanding balance
of the Indebtedness may be adjusted as Administrative Agent, in its sole
discretion, deems appropriate under the circumstances. 

          Section
2.12.      FEES. The
Borrowers shall pay to the Administrative Agent, for the account of Initial
Lender, a commitment fee (the “Commitment Fee”) as set forth in Section
2.12 of Schedule A attached hereto, which Commitment Fee shall be fully earned
and due and payable on the Closing Date.

          Section
2.13.      CAPITAL
REIMBURSEMENT. If either (a) the introduction or implementation
after the date hereof of or the compliance with or any change after the date
hereof in or in the interpretation of any Law regarding capital adequacy, or (b)
the introduction or implementation after the date hereof of or the compliance
with any request, directive or guideline issued after the date hereof from any
central bank or other governmental authority (whether or not having the force of
Law) regarding capital requirements has or would have the effect of reducing the
rate of return on any Lender’s capital, or on the capital of any corporation
controlling such Lender, as a consequence of the Loans made by such Lender, to a
level below 

25 

that which such Lender or such corporation could have achieved
but for such change (taking into consideration such Lender’s policies and the
policies of any such corporation with respect to capital adequacy), then from
time to time Borrowers will pay to such Lender, within ten (10) Business Days of
demand therefore by such Lender, such additional amount or amounts as will
compensate such Lender for such reduction. In determining such amount or
amounts, a Lender may use any reasonable averaging or attribution methods. Any
such demand by a Lender shall include a brief summary description, in reasonable
detail, of the basis for such demand. 

          Section
2.14.      [Reserved].

          Section
2.15.      TAXES.
All payments of principal and interest on the Loans and all other
amounts payable hereunder shall be made free and clear of and without deduction
for any present or future income, excise, stamp, documentary, property or
franchise taxes and other taxes, fees, duties, levies, assessments, withholdings
or other charges of any nature whatsoever (including interest and penalties
thereon) imposed by any taxing authority, excluding taxes imposed on or measured
by a Lender Party’s net income by the jurisdiction under which such Lender Party
is organized or conducts business (other than solely as the result of entering
into any of the Loan Documents or taking any action thereunder) (all
non-excluded items being called “Taxes”). If any withholding or deduction from
any payment to be made by a Borrower hereunder is required in respect of any
Taxes pursuant to any applicable Law, then Borrowers will: (i) pay directly to
the relevant authority the full amount required to be so withheld or deducted;
(ii) promptly forward to Administrative Agent an official receipt or other
documentation reasonably satisfactory to Administrative Agent evidencing such
payment to such authority; and (iii) pay to Administrative Agent for the account
of the Lender Parties such additional amount or amounts as is necessary to
ensure that the net amount actually received by the Lender Parties will equal
the full amount the Lender Parties would have received had no such withholding
or deduction been required. If any Taxes are directly asserted against any
Lender Party with respect to any payment received by such Lender Party
hereunder, such Lender Party may pay such Taxes and Borrowers will promptly pay
such additional amounts (including any penalty, interest or expense) as is
necessary in order that the net amount received by such Lender Party after the
payment of such Taxes (including any Taxes on such additional amount) shall
equal the amount such Lender Party would have received had such Taxes not been
asserted so long as such amounts have accrued on or after the day which is two
hundred seventy (270) days prior to the date on which such Lender Party first
made demand therefor. If Borrowers fail to pay any Taxes when due to the
appropriate taxing authority or fails to remit to Administrative Agent, for the
account of the respective Lender Parties, the required receipts or other
required documentary evidence, Borrowers shall indemnify the Lender Parties for
any incremental Taxes, interest or penalties that may become payable by any
Lender Party as a result of any such failure. 

ARTICLE 3 
SECURITY 

          Section
3.1.      SECURITY
INTEREST. To secure the prompt payment to Lender Parties of the
Indebtedness and any and all other obligations owed by Borrowers to Lender
Parties, whether now existing or hereinafter arising, each Borrower hereby
irrevocably grants to Administrative Agent and Additional Collateral Agent, in
each case for the benefit of the Lender 

26 

Parties, a first and continuing security interest in all of the
following property, whether now owned or existing or hereafter acquired, of such
Borrower: all assets of such Borrower, including all Accounts, Automobile
Inventory, chattel paper, commercial tort claims set forth on Section 3.1 to
Schedule A hereto, deposit accounts and other bank accounts wherever maintained
and established (and all funds at any time paid, deposited, credited or held in
such accounts), documents, equipment, fixtures, general intangibles, goods,
instruments, inventory, investment property, letter-of-credit rights, software
(for purposes of this definition of Collateral only, “software” shall have the
meaning provided in Article 9 of the UCC), supporting obligations, contract
rights and all books and records related to the foregoing and all proceeds
(including, without limitation, “proceeds” as defined in Article 9 of the UCC)
of any of the foregoing, including without limitation interest, dividends, cash,
instruments and other property from time to time received, receivable or
otherwise distributed in respect of or in exchange for or on account of the sale
or other disposition of any or all of the foregoing, and all additions and
accessions to any of the foregoing (the foregoing, together with any other asset
in which a Borrower or other Person shall grant a security interest to
Administrative Agent and/or Additional Collateral Agent, for the benefit of the
Lender Parties, to secure the Indebtedness, collectively, the
“Collateral”). Without limiting the foregoing, the Collateral shall
include, without limitation, the following: 

                    (a)      All
right, title and interest of the Borrowers in and to the Receivables and the
underlying Consumer Loan Documents related thereto; 

                    (b)      All
right, title and interest of the Borrowers in and to all other property whether
now or hereafter owned, acquired or held by the Borrowers which secure (or
constitute collateral for) any of the Receivables and Consumer Loan Documents or
other instruments or agreements which evidence any of the Receivables, including
without limitation, all right, title and interest in and to all financing
statements perfecting such security interests in any of the foregoing; 

                    (c)      All
right, title and interest of the Borrowers in and to all guaranties and other
instruments by which any Person guarantees the payment or performance of the
Receivables; 

                    (d)      All
right, title and interest of the Borrowers in and to all insurance policies
pertaining to or obtained by any Account Debtor or the Borrower in connection
with, or arising out of, any Consumer Loan Document; 

                    (e)      All
right, title and interest of the Borrowers in and to all commitments and other
agreements to purchase any Receivables; 

                    (f)      All
right, title and interest of the Borrowers in and to all collections on, and
proceeds of or from, any and all of the foregoing; 

                    (g)      All
files, surveys, certificates, correspondence, appraisals, computer programs,
software, tapes, discs, cards, accounting records, and other records,
information, and 

27 

data of the Borrowers relating to the Receivables (including
all information, data, programs, tapes, discs and cards necessary to administer
and service such Receivables); 

                    (h)     
All contract rights, accounts, rights to payment of money, and general
intangibles, relating to such documents and contracts described in (a) through
(g) above and as to all such Collateral described in (a) through this
subparagraph (h) whether now existing or hereafter at any time acquired or
arising; 

                    (i)     
Borrowers’ now existing or hereafter arising rights to service, administer
and/or collect on the Receivables and all rights to the payment of money on
account of such servicing, administration and/or collection activities; 

                    (j)      All
monies, securities and property, now or hereafter held, received by, entrusted
to, or in the possession or under the control of the Administrative Agent, for
the benefit of the Lender Parties, or a bailee of the Administrative Agent, for
the benefit of the Lender Parties, and all investment property now or hereafter
owned by Borrowers; 

                    (k)     
All accessions to, substitutions for and all replacements, products and proceeds
of the foregoing, including, without limitation, proceeds of insurance policies
(including but not limited to claims paid and premium refunds); and 

                    (l)      All
books and records (including, without limitation, customer lists, credit files,
tapes, ledger cards, computer software and hardware, electronic data processing
software, computer printouts and other computer materials and records) of
Borrowers evidencing or containing information regarding any of the foregoing.

The Borrowers will supplement this Agreement from time to time
at Administrative Agent’s request to grant the Administrative Agent, for the
benefit of the Lender Parties, a security interest in all commercial tort claims
that the Borrowers may at any time have against any Person. The parties hereto
hereby acknowledge and agree that the Administrative Agent and the Additional
Collateral Agent are both beneficiaries of the grants of liens and security
interests hereunder and that such liens and security interests may be perfected
by Administrative Agent, Additional Collateral Agent or both, and in any event
regardless of the manner of perfection and regardless whether such liens or
security interests are granted to or perfected by Administrative Agent,
Additional Collateral Agent or both, such liens and security interests shall
constitute first priority perfected liens and security interests securing all of
the Indebtedness.

          Section
3.2.      COLLATERAL
ASSIGNMENT OF CONSUMER LOAN DOCUMENTS AND AUTO TITLE. Each
Borrower hereby collaterally assigns to the Administrative Agent and Additional
Collateral Agent, in each case for the benefit of the Lender Parties, all of
such Borrower’s right and title to and interest in, to and under (but not any
obligations under) the Consumer Loan Documents and each Auto Title related to
each Receivable and all other agreements, documents and instruments related to
any of the foregoing (collectively, the “Assigned Documents”). Each
Borrower confirms and agrees that the Administrative Agent and Additional
Collateral Agent (or any designee thereof), following an Event of Default,
shall, at its option, have the sole right to enforce such Borrower’s rights and

28 

remedies under each Assigned Document, but without any
obligation on the part of the Administrative Agent, the other Lender Parties or
any of their respective affiliates to perform any of the obligations of Borrower
under any such Assigned Document. 

          Section
3.3.      FINANCING STATEMENTS
AND FURTHER ASSURANCES.

                    (a)      Each
Borrower hereby authorizes Administrative Agent and Additional Collateral Agent
to file UCC-1 Financing Statements with respect to the Collateral, and any
amendments or continuations relating thereto, which UCC-1 Financing Statements
may describe the Collateral as “all present and future assets of the Debtor” or
words of similar effect, regardless of whether any particular asset comprised in
the Collateral falls within the scope of Article 9 of the Uniform Commercial
Code. Borrowers shall not allow any financing statement or notice of assignment
of any Receivables, other than those filed in favor of Administrative Agent or
Additional Collateral Agent, the Trafalgar Subordinated Lender(s) and the
holders of Liens permitted pursuant to Section 6.2(a) hereof, to be on file in
any public office covering any Collateral, proceeds thereof or other matters
subject to the security interest granted to Administrative Agent and Additional
Collateral Agent (for the benefit of the Lender Parties). 

                    (b)      Borrowers
hereby agree to deliver to Administrative Agent, at such places as
Administrative Agent may reasonably designate, (i) schedules executed by
Borrowers, listing the Receivables and fully and correctly specifying in
adequate detail the aggregate unmatured unpaid face amount of each Receivable
and the amount of the deferred installments thereof falling due each month and
(ii) schedules executed by the Borrowers, listing the Automobile Inventory and
specifying in adequate detail each Borrower’s cost basis and current NADA trade
in value with respect thereto. These schedules shall be in form and tenor
satisfactory to or supplied by Administrative Agent. All schedules delivered and
Collateral pledged to Administrative Agent and Additional Collateral Agent, for
the benefit of the Lender Parties, shall be assigned to Administrative Agent and
Additional Collateral Agent, for the benefit of the Lender Parties. 

                    (c)      Each
Borrower shall, from time to time, at its expense, promptly execute and deliver
all further instruments, documents and notices and take all further action that
may be necessary, or that Administrative Agent may reasonably request in order
to create, perfect and protect the Liens of Administrative Agent and Additional
Collateral Agent in the Collateral, or to enable Administrative Agent or
Additional Collateral Agent to exercise and enforce its rights and remedies
hereunder or under any other Loan Document with respect to any Collateral,
including, without limitation, (i) entering into deposit account control
agreements, securities account control agreements, intellectual property
security agreements, collateral assignments of lease, equity pledge agreements
(including irrevocable proxies and assignments separate from certificate) and
assignments separate from certificate, in each case in form and substance
reasonably satisfactory to Administrative Agent, (ii) delivering to
Administrative Agent or Additional Collateral Agent, all original instruments,
certificated securities and other assets, perfection of a Lien with respect to
which may be perfected by possession under applicable law, together with any
assignments separate from certificates and allonges ancillary thereto and (iii)
providing Administrative Agent or Additional Collateral Agent with “control” (as
such term is defined in any applicable uniform commercial code) over any
Collateral, a Lien with respect to 

29 

which may be perfected by “control”, pursuant to documentation
in form and substance reasonably satisfactory to Administrative Agent.

          Section
3.4.      DELIVERY OF
RECEIVABLES; INSTRUMENTS, DOCUMENTS, ETC. 

                    (a)      Each
Borrower hereby agrees to deliver to the applicable Custodian (i) the original
Consumer Loan Documents evidencing each Receivable, and the executed application
for title within five (5) Business Days after such Consumer Loan Documents are
executed and delivered to such Borrower by the applicable Account Debtor and the
Receivable is created, (ii) the original Auto Title within five (5) Business
Days after issuance by the applicable state to such Borrower reflecting such
Borrower, Additional Collateral Agent and Administrative Agent as lien holder on
the vehicle securing such Receivable (with respect to listing Additional
Collateral Agent and Administrative Agent as lien holder, only with respect to
Receivables arising after the date hereof), and (iii) if an original Auto Title
has not yet been issued by the applicable state reflecting such Borrower,
Additional Collateral Agent and Administrative Agent as lien holder, any
applicable, “Title Guaranties,” “Title Applications” or “Title Receipts” (as
such terms are defined in the Existing Carbiz Custodian Agreement) within five
(5) Business Days after such Borrower’s receipt of same, each in accordance with
the applicable Custodian Agreement. All Receivables shall, regardless of their
location, be deemed to be under Administrative Agent’s and Additional Collateral
Agent’s (for the benefit of itself and the Lender Parties) dominion and control
(with files so labeled) and deemed to be in Administrative Agent’s and
Additional Collateral Agent’s (for the benefit of itself and the Lender
Parties’) possession. For purposes of this Section 3.4(a) the term “applicable
Custodian” shall mean the Custodian under the Existing Carbiz Custodian
Agreement unless the applicable Receivable (and related Consumer Loan Documents)
was acquired by Carbiz AQ pursuant to the Asset Purchase Agreement or arises
(whether now or in the future) from a transaction involving Calcott Automobile
Inventory, in which case the term “applicable Custodian” shall mean the
Custodian under the Carbiz AQ Custodian Agreement. 

                    (b)      Each
Borrower hereby agrees to deliver to the applicable Custodian (or cause to be
delivered to the applicable Custodian), within five (5) Business Day’s of such
Borrower’s acquisition of such Automobile Inventory, (i) the original Auto Title
evidencing each such item of Automobile Inventory reflecting Additional
Collateral Agent and Administrative Agent as lien holder of record (with respect
to listing Additional Collateral Agent and Administrative Agent as lien holder,
only with respect to Automobile Inventory acquired after the date hereof), or
(ii) if an original Auto Title has not yet been issued by the applicable state,
any applicable, “Title Guaranties,” “Title Applications” or “Title Receipts” (as
such terms are defined in the Existing Carbiz Custodian Agreement) obtained in
connection with the acquisition of such Automobile Inventory, in each case, in
accordance with the applicable Custodian Agreement. For purposes of this Section
3.4(b) the term “applicable Custodian” shall mean the Custodian under the
Existing Carbiz Custodian Agreement except with respect to Calcott Automobile
Inventory (whenever acquired or reacquired by a Borrower), in which case the
“applicable Custodian” shall be the Custodian under the Carbiz AQ Custodian
Agreement. 

30 

                    (c)      Each
Borrower shall deliver and pledge to the Administrative Agent, Additional
Collateral Agent or any of their agents any and all other Instruments,
negotiable Documents, Chattel Paper and certificated securities (that are not
Consumer Loan Documents) duly endorsed and/or accompanied by such instruments of
assignment and transfer executed by such Borrower, in such form and substance as
the Administrative Agent may reasonably request, including the updated report of
subsequent Title submitted to replace the executed application for Title.

          Section
3.5.      FAILURE TO
DELIVER. Failure to deliver physical possession of any instruments,
documents or writings in respect of any Receivable to Administrative Agent or
Additional Collateral Agent (including the applicable Custodian, as custodian
and bailee for the Administrative Agent and Additional Collateral Agent) shall
not invalidate Administrative Agent's or Additional Collateral Agent’s security
interest, for the benefit of the Lender Parties, therein. To the extent that
possession may be required by applicable law for the perfection of
Administrative Agent's and Additional Collateral Agent’s (for the benefit of the
Lender Parties) security interest, the original chattel paper and instruments
representing the Receivables so held by a Borrower shall be deemed to be held by
Administrative Agent and Additional Collateral Agent, although kept by such
Borrower as the custodial agent of Administrative Agent, Additional Collateral
Agent and the Lender Parties. 

          Section
3.6.      NOTICE OF SECURITY
INTEREST AND COLLATERAL ASSIGNMENT. All contracts, documents
or instruments representing or evidencing a Receivable shall contain (by way of
stamp or other method reasonably satisfactory to Administrative Agent) the
following language: “THIS DOCUMENT IS SUBJECT TO A SECURITY INTEREST IN FAVOR
OF, AND PLEDGED AS COLLATERAL TO SWC SERVICES, LLC, AS ADMINISTRATIVE AGENT, AND
AGM, LLC, AS ADDITIONAL COLLATERAL AGENT, FOR THE BENEFIT OF THEMSELVES AND
CERTAIN LENDERS. THE CREATION OF ANY SUBSEQUENT SECURITY INTEREST IN THIS
DOCUMENT VIOLATES THE RIGHTS OF THE ADMINISTRATIVE AGENT, ADDITIONAL COLLATERAL
AGENT AND LENDERS.”

          Section
3.7.      RECORDS AND
INSPECTIONS. Related Parties shall at all times keep complete and
accurate records pertaining to the Collateral, which records shall be current on
a daily basis and located only at the locations set forth in Section 3.7 of
Schedule A attached hereto. Administrative Agent and Additional Collateral
Agent, by or through any of their officers, agents, employees, attorneys or
accountants, shall have the right to enter any such locations, at any reasonable
time or times during regular business hours, for so long as Administrative Agent
or Additional Collateral Agent may desire, to inspect the Collateral and to
inspect, audit and make extractions or copies from the books, records, journals,
orders, receipts, correspondence or other data relating to the Collateral or
this Agreement. 

         Section
3.8.      COLLECTION.
Subject to Section 3.9, Borrowers agree at their own expense to promptly and
diligently collect each installment of all Receivables in trust for the
exclusive account of Administrative Agent and Additional Collateral Agent, for
the benefit of the Lender Parties, to hold Lender Parties harmless from any and
all loss, damage, penalty, liability, fine or expense arising from such
collection by Borrowers or their agents, and to faithfully 

31 

account therefor to Administrative Agent and Additional
Collateral Agent. Upon the occurrence of a Default or an Event of Default,
Administrative Agent and Additional Collateral Agent each expressly retains the
unqualified right at any time it so elects to take over the collection of the
Receivables directly (through an agent of such Person or otherwise). 

          Section
3.9.      COLLECTION
ACCOUNTS. Borrowers shall ensure that all collections of
Receivables (including, without limitation, all scheduled payments, all
prepayments, all overdue payments, all insurance proceeds, recoveries and all
cash receipts and proceeds in respect of the underlying automobile securing the
Receivables), all other amounts remitted by any Account Debtor, an insurer, any
other Person making a payment on a Receivable or in connection with proceeds of
the underlying automobile securing such Receivable, the proceeds of sales of
Automobile Inventory and the proceeds of all other Collateral are deposited into
a Collection Account within one (1) Business Day of receipt thereof. Borrowers
shall cause all payments of Receivables and other proceeds of the sale of
Automobile Inventory and other Collateral to be deposited into a Collection
Account. Until such time as any Receivables collections or other proceeds of
Collateral are deposited by the Borrowers into the applicable Collection
Account, such collections and proceeds shall be held in trust for the benefit of
Administrative Agent and the other Lender Parties. The Collection Accounts shall
be swept automatically on a weekly basis and the depository bank maintaining a
Collection Account will wire, or otherwise transfer, in immediately available
funds, all funds received or deposited into such Collection Account (other than
$300 or such other nominal amount in each account which the depository bank may
require to be held as a compensating balance) to the Payment Account or such
other bank account as Administrative Agent or Additional Collateral Agent, as
the case may be, may from time to time designate for such purpose. Borrowers
hereby confirm and agree that all amounts deposited in the Collection Accounts
and any other funds received and collected by Administrative Agent or Additional
Collateral Agent, whether as proceeds of Collateral or otherwise, shall
constitute Collateral. Notwithstanding and without limiting any other provision
of this Agreement or any of the other Loan Documents, Administrative Agent shall
apply all funds transferred from the Collection Accounts into the Payment
Account or other bank account designated by Administrative Agent or Additional
Collateral Agent pursuant to this Section 3.9 as set forth in Section 2.11
hereof and subject to the clearance period set forth in Section 2.5 hereof. If a
credit balance exists with respect to the Collection Accounts as the result of
collections of Receivables or proceeds of other Collateral pursuant to the terms
and conditions of this Section 3.9, such credit balance shall not accrue
interest in favor of the Borrowers, but shall, subject to the terms of Section
2.11 hereof, be available to Borrowers in accordance with the terms of this
Agreement. All funds transferred from the Collection Accounts into the Payment
Account or other bank account designated by Administrative Agent or Additional
Collateral Agent pursuant to this Section 3.9 shall be applied to reduce the
Indebtedness (or be made available to Borrowers in accordance with Section 2.11
hereof), but, for purposes of calculating interest hereunder, shall be subject
to a four (4) Business Day clearance period. All Items deposited in the
Collection Accounts shall be subject to final payment. If any such Item is
returned uncollected, the Borrowers will immediately pay the Administrative
Agent, for the account of the Lender Parties, or, for Items deposited in the
Collection Accounts, the bank maintaining such account, the amount of that Item,
or such bank at its discretion may charge any uncollected Item to the Borrowers’
commercial account or other account. The Borrowers shall be liable as an
endorser on all Items deposited in the Collection Accounts, whether or not in
fact 

32 

endorsed by Borrowers. Upon Administrative Agent’s or
Additional Collateral Agent’s request any time following the occurrence of an
Event of Default, Borrowers agree to establish and maintain a lockbox with a
bank acceptable to Administrative Agent or Additional Collateral Agent and to
execute with such bank a lockbox agreement acceptable to Administrative Agent or
Additional Collateral Agent, as applicable, in its sole discretion. Thereafter,
Borrowers shall ensure that all collections of Receivables and the proceeds of
other Collateral are paid directly by the Account Debtors to the lockbox and to
the extent that any Receivables collections or other proceeds of Collateral are
not sent directly to the lockbox but are received by a Borrower, such
collections and proceeds shall be held in trust for the benefit of
Administrative Agent and Additional Collateral Agent and within one (1) Business
Day of receipt thereof shall be remitted via overnight mail to the
Administrative Agent for deposit, in the form received, to the lockbox 

          Section
3.10.      PROTECTION OF
RECEIVABLE RECORDS AND MANAGEMENT OF RECEIVABLES
INFORMATION. Borrowers hereby agree to take the following
protective actions to prevent destruction of the Collateral and records
pertaining to the Collateral: (i) if a Borrower maintains its Collateral records
on a manual system such records shall be kept in a fire proof cabinet or on no
less than a monthly basis, a record of all payments on Receivables and all other
matters relating to the Collateral shall be placed in an off site safety deposit
box (and Administrative Agent shall have access to such safety deposit box); or
(ii) if the Collateral records are computerized, Borrowers agree to create a
tape or diskette “back-up” of the computerized information and upon the request
of Administrative Agent, provide Administrative Agent with a tape or diskette
copy of such “back-up” information. Without limiting the foregoing, if the
Borrowers have purchased a software license for an internet based payment
system, or use a proprietary electronic payment system, and Borrowers have
implemented any such payment system, then (i) Borrowers shall grant to
Administrative Agent full access rights to such software and payment system,
including but not limited to passwords and login information with offsite
internet access capability, if available, (ii) Borrowers shall authorize and
instruct the provider of such software to provide Administrative Agent, at its
request, with all back-up materials and information for such payment system and
(iii) in the event that such provider of software becomes unable to provide such
service to Borrowers, Borrowers will immediately obtain another such internet
based payment service that provides equivalent software and access rights to
Borrowers and Administrative Agent, including but not limited to full access
rights to Administrative Agent and back-up materials and information as
requested by Administrative Agent. 

          Section
3.11.      USE OF
PROCEEDS. Borrowers shall use the proceeds of the Loans in the
ordinary course of business, solely in its operations for working capital,
refinancing on the Closing Date of Liabilities, payments to Lender Parties
hereunder or as set forth in Section 3.11 of Schedule A. 

          Section
3.12.      RETURN OF
COLLATERAL. Upon the payment in full of any Receivable to which the
written documents evidencing such Receivable are held by Administrative Agent,
Additional Collateral Agent or a Custodian, Borrowers shall submit a request to
the Administrative Agent or Additional Collateral Agent, as applicable, for the
return of such documents pursuant to a Request For Return of Collateral Form, a
copy of which is attached hereto as Exhibit B (and shall additionally
submit all requests required of it under the 

33 

applicable Custodian Agreement to the respective Custodian) and
Administrative Agent or Additional Collateral Agent, as applicable, shall return
(or cause the appropriate Custodian to return) such documents within five (5)
Business Days after receipt of such request. 

          Section
  3.13.      COLLATERAL REPRESENTATIONS,
  WARRANTIES, AND COVENANTS. The Borrowers jointly and severally
  represent and warrant to, and covenant with, Administrative Agent, for the benefit
  of the Lender Parties, as follows:

                    (a)     
The Borrowers have good and marketable title to all of the Collateral and the
Borrowers have rights in and the power to transfer the Collateral in which they
purport to grant a security interest pursuant to Section 3.1 hereof (subject,
with respect to after acquired Collateral, to Borrowers’ acquiring the same) and
no Lien other than Liens permitted under Section 6.2(a) hereof exists or shall
exist upon such Collateral at any time; 

                    (b)      This
Agreement is effective to create in favor of Administrative Agent and Additional
Collateral Agent, for the benefit of the Lender Parties, a valid security
interest in and Lien upon all of the Borrowers’ right, title and interest in and
to the Collateral, and, upon the filing of appropriate Uniform Commercial Code
financing statements in the jurisdictions listed on Section 3.13(b) of
Schedule A attached hereto and, with respect to patents, trademarks and
copyrights (if any) of the Borrowers, the filing with the United States Patent
and Trademark Office and the United States Copyright Office, as applicable, such
security interest and Liens shall be duly perfected in all the Collateral (other
than Instruments not constituting Chattel Paper), and upon delivery of the
Instruments to Administrative Agent or Additional Collateral Agent or one of
their agents (including, a Custodian with respect to Consumer Loan
Documentation), duly endorsed by Debtor or accompanied by appropriate
instruments of transfer duly executed by the applicable Borrower, the security
interest and Liens in the Instruments shall be duly perfected; 

                    (c)      All
of the Equipment, Automobile Inventory, Inventory and Goods of Borrowers are
located at the places as specified on Section 5.1(n) of Schedule A attached
hereto and, except for Consumer Loan Documentation in the possession of a
Custodian, none of the Collateral is in the possession of any bailee,
warehousemen, processor or consignee;

                    (d)      No
Borrower owns any registered copyrights, patents or trademarks except for those
copyrights, patents and trademarks described on Section 3.13(d) of Schedule A,
none of which have been adjudged invalid or unenforceable or have been canceled,
in whole or in part, or are not presently subsisting, and each of such
copyrights, patents and trademarks are valid and enforceable. The applicable
Borrower identified on Section 3.13(d) of Schedule A is the sole and exclusive
owner of the entire and unencumbered right, title and interest in and to each of
such copyrights, patents and trademarks, free and clear of any liens, charges
and encumbrances, including without limitation licenses, shop rights and
covenants by Borrowers not to sue third persons. No Borrower has any notice of
any suits or actions commenced or threatened with reference to such registered
copyrights, patents or trademarks, or any claim of intellectual property
infringement with respect to any intellectual property used by the Borrowers in
the operation of their respective businesses. If any Borrower shall (i) obtain
rights to any new patentable inventions, any registered copyrights, trademarks
or any patents, or (ii) become 

34 

entitled to the benefit of any registered copyrights or
trademarks or any patents or any improvement on any patent, the provisions of
this Agreement above shall automatically apply thereto and such Borrower shall
give to Administrative Agent prompt written notice thereof. Borrowers shall have
the duty, subject to the exercise of their reasonable business judgment, (i) to
prosecute diligently any patent, trademark, or service mark applications pending
as of the date hereof or hereafter, (ii) to make application on unpatented but
patentable inventions and on trademarks, copyrights and service marks, as
appropriate, (iii) to preserve and maintain all rights in copyrights, trademarks
or any patents, to the extent material to the operations of the business of any
Borrower and (iv) to ensure that the copyrights, trademarks or any patents used
by any Borrower are and remain enforceable, to the extent material to the
operations of the business of any Borrower. Subject to the exercise of the
Borrowers’ reasonable business judgment, no Borrower shall abandon any right to
file a patent, trademark or service mark application, or abandon any pending
patent, application or any other copyright, patent or trademark without the
written consent of Administrative Agent, which consent shall not be unreasonably
withheld. 

                    (e)      Borrowers
shall deliver to the Administrative Agent an updated Section 3.13(b),
3.13(d), 3.13(f) and 5.1(n) of Schedule A within five (5) days of any change
thereto; provided, that delivery or receipt of such subsequent disclosure
shall not relieve or otherwise constitute a waiver by any Lender Party or a cure
of any Default or Event of Default resulting in connection with the matters
disclosed or a breach of the underlying covenant, representation or warranty
(regardless of such disclosure); 

                    (f)      All
depositary and other accounts maintained by Borrowers and each Guarantor are
described on Section 3.13(f) of Schedule A hereto, which description
includes for each such account the name of the Related Party maintaining such
account, the name, address and telephone and telecopy numbers of the financial
institution at which such account is maintained, the account number and the
account officer, if any, of such account. No Borrower or Guarantor shall open
any new accounts unless such Related Party shall have given Administrative Agent
and Additional Collateral Agent at least ten (10) Business Days’ prior written
notice of its intention to open any such new accounts.

                    (g)     
Borrowers shall take any and all actions necessary or reasonably requested by
the Administrative Agent, from time to time, to (i) cause the Administrative
Agent and/or Additional Collateral Agent to obtain exclusive control of any
investment property owned by Borrowers in a manner acceptable to Administrative
Agent, and (ii) obtain from any issuers of investment property and such other
Persons, for the benefit of Administrative Agent and/or Additional Collateral
Agent, written confirmation of Administrative Agent’s or Additional Collateral
Agent’s control over such Investment Property. For purposes of this Section
3.13(g), Administrative Agent or Additional Collateral Agent, as applicable,
shall have exclusive control of investment property if (i) such investment
property consists of certificated securities and the applicable Borrower
delivers such certificated securities to the Administrative Agent or Additional
Collateral Agent, respectively (with appropriate endorsements if such
certificated securities are in registered form); (ii) such investment property
consists of uncertificated securities and either (x) the applicable Borrower
delivers such uncertificated securities to the Administrative Agent or
Additional Collateral Agent, as applicable or (y) the issuer thereof agrees,
pursuant to documentation in form and substance reasonably satisfactory to the

35 

Administrative Agent, that it shall comply with instructions
originated by Administrative Agent or Additional Collateral Agent, as
applicable, without further consent by such Borrower, and (iii) such investment
property consists of security entitlements and either (x) Administrative Agent
or Additional Collateral Agent, as applicable, becomes the entitlement holder
thereof or (y) the appropriate securities intermediary agrees, pursuant to
documentation in form and substance reasonably satisfactory to Administrative
Agent, that it shall comply with entitlement orders originated by Administrative
Agent or Additional Collateral Agent, as applicable, without further consent by
any Borrower. 

          Section
  3.14.      LENDER'S PAYMENT OF
  CLAIMS. Administrative Agent or Additional Collateral Agent may,
  in such Person’s sole discretion, discharge or obtain the release of any
  Lien asserted by any Person against the Collateral (other than Liens permitted
  pursuant to Section 6.2 hereof). All sums paid by Administrative Agent or Additional
  Collateral Agent in respect thereof shall be payable, on demand, by Borrowers
  to Administrative Agent or Additional Collateral Agent, as applicable, and shall
  be a part of the Indebtedness.

ARTICLE 4 
CONDITIONS OF CLOSING; SUBSEQUENT
ADVANCES 

          Section
4.1.      INITIAL
ADVANCE. The obligation of Lender Parties to make the initial Loan
Advance hereunder is subject to the fulfillment, to the satisfaction of
Administrative Agent, Lenders and their counsel, of each of the following
conditions prior to such initial Loan Advance: 

                    (a)     
Loan Documents. Administrative Agent shall have received each of the
following Loan Documents: (i) this Agreement executed by the respective parties;
(ii) Schedule A executed by the respective parties; (iii) the initial Note(s)
executed by Borrowers; (iv) each Guaranty Agreement executed by the respective
Guarantor, JV Partner or Validity Guarantor, as applicable; (v) each Pledge
Agreement executed by the applicable Related Party; (vii) the Custodian
Agreements executed by the applicable parties thereto; (viii) the Account
Control Agreements executed by the parties thereto; (ix) the Trafalgar
Subordination Agreement and Management Subordination Agreement each executed by
the parties thereto and each other Subordination Agreement(s) executed by the
holders of the Subordinated Debt (if any), the Borrowers and Administrative
Agent, and (x) such other documents, instruments and agreements in connection
herewith as Administrative Agent shall require, executed, certified and/or
acknowledged by such parties as Administrative Agent shall designate. 

                    (b)      Initial
Payment. Administrative Agent shall have received for the benefit of the
Lenders Borrowers’ payment of the Commitment Fee in immediately available funds.

                    (c)      Asset
Purchase Agreement; Subordinated Debt Financing. (i) The acquisition and
related transactions under the Asset Purchase Agreement and all agreements,
documents and instruments executed in connection therewith shall have closed
concurrently with the closing of this Agreement, and (ii) Administrative Agent
shall have received evidence reasonably satisfactory to it that the Borrowers
have received (by wire transfer of immediately available funds to the Operating
Account listed as the “Primary Operating Account” on Section 

36 

2.1(c) of Schedule A hereto) not less than (A) $2,500,000 of
cash proceeds from the funding of the Trafalgar Subordinated Debt described in
clauses (ii) and (iii) of the definition thereof (net of transaction fees, costs
and expenses incurred in connection therewith) and (B) $600,000 of cash proceeds
from the funding of the Management Subordinated Debt (net of transaction fees,
costs and expenses incurred in connection therewith).

                    (d)      Outside
Director. Carbiz AQ shall have modified its charter documents to provide for
the election of an Outside Director as required by Section 6.8 hereof. 

                    (e)     
Charter Documents. Administrative Agent shall have received copies of
Borrowers’, each Guarantor’s and JV Partner’s charter documents, certified by
the appropriate official of such Person’s jurisdiction of organization and
Borrowers’, each Guarantor’s and JV Partner’s bylaws, partnership agreement or
operating agreement, as applicable, each as amended, modified, or supplemented
to the Closing Date and each certified by the Secretary of the applicable
Borrower, the applicable Guarantor and JV Partner, respectively. 

                    (f)      Good
Standing. Administrative Agent shall have received a good standing
certificate with respect to each Borrower, each Guarantor and JV Partner, dated
within thirty (30) days of the Closing Date, by the appropriate official of such
Person’s jurisdiction of organization (unless such jurisdiction does not issue
such certificates), which certificates shall indicate that each Borrower, the
Guarantors and JV Partner are each in good standing in such jurisdictions. 

                    (g)     
Foreign Qualification. Administrative Agent shall have received
certificates with respect to Borrower, each Guarantor and JV Partner relating to
such Person’s qualification to do business in each state where such Person
maintains assets or in which such Person’s failure to be duly qualified or
licensed would have a material adverse effect on its financial condition or
assets, each dated within thirty (30) days of the Closing Date, issued by the
appropriate official of each state and indicating that such Person is qualified
to do business in such state and in good standing. 

                    (h)      Authorizing
Resolutions and Incumbency. Administrative Agent shall have received a
certificate from the Secretary of each Borrower, each Guarantor and JV Partner
attesting to (i) the adoption of resolutions of each respective Board of
Directors, partners or members, as applicable authorizing the borrowing of money
from Lenders or the guaranty of the Indebtedness, as the case may be, the pledge
of and granting of Liens upon its assets, and execution and delivery of this
Agreement and the other Loan Documents to which any such Person is a party, and
authorizing specific officers of such Person to execute same, and (ii) the
authenticity of original specimen signatures of such officers. 

                    (i)      Property
and Liability Insurance. Administrative Agent shall have received the
insurance certificates and certified copies of policies required herein, along
with a loss payable endorsement naming Administrative Agent, for the benefit of
the Lender Parties, as sole loss payee and as additional insured, all in form
and substance reasonably satisfactory to Administrative Agent and its counsel.

37 

                    (j)     
Searches; Certificates of Title. Administrative Agent shall have received
evidence reflecting the filing of its and Additional Collateral Agent’s
financing statements and other filings in such jurisdictions as it shall
determine, and shall have received certificates of title with respect to the
Collateral which shall have been duly executed in a manner sufficient to perfect
all of the security interests granted to Administrative Agent and Additional
Collateral Agent, for the benefit of the Lender Parties, and shall have received
other background reports and information with respect to Borrowers, Guarantors,
members of Borrowers’ senior management, the owners of Borrowers, and any other
Person who provides financial or collateral information to the Administrative
Agent or Additional Collateral Agent, which are satisfactory to Administrative
Agent, in Administrative Agent’s sole discretion. 

                    (k)     
Landlord Waivers. Administrative Agent shall have received Landlord
Waivers in form and substance satisfactory to Administrative Agent from the
lessors of all locations where any Collateral is located. 

                    (l)      Opinion
of Counsel. Administrative Agent shall have received an opinion of
Borrowers’ and Guarantors’ counsel, covering such matters as Administrative
Agent shall reasonably determine, which opinion shall be in form and substance
reasonably satisfactory to Administrative Agent. 

                    (m)     
Solvency Certificate. A signed certificate of the Borrowers’ duly elected
Chief Financial Officer concerning the solvency and financial condition of the
Borrowers, in form and substance reasonably acceptable to Administrative Agent.

                    (n)      Collection
Accounts. The Collection Accounts shall have been established to the
reasonable satisfaction of Administrative Agent and Additional Collateral Agent
in their sole discretion. 

                    (o)     
Investment Banking Fee. The Administrative Agent shall have received
evidence, in form and substance reasonably satisfactory to Administrative Agent,
of (i) the payment of all investment banking and similar advisory fees and
expenses to GVC Financial Services, LLC (which fees and expenses Borrowers
hereby represent to Administrative Agent and the Lenders to be an amount not in
excess of $875,000 in the aggregate) or (ii) satisfactory arrangements for the
payment of such fees and expenses from the initial proceeds of the Loans on the
Closing Date. 

                    (p)      Custodian
Deliverables. The Custodians shall have received the applicable Consumer
Loan Documents and all other documents, instruments and writings required to be
delivered to the Custodians hereunder and under the Custodian Agreements and
Administrative Agent shall have received the Custodial Certificate from the
Custodians relating thereto. 

                    (q)      No
Material Adverse Effect. No event or condition has occurred since January
31, 2007, or is existing which has had or could reasonably be expected to have
(i) a material adverse effect on the business, operations, results of
operations, prospects, assets, liabilities or financial condition of any
Borrower or any Guarantor, or (ii) a material adverse 

38 

effect on the ability of any Borrower or any Guarantor to
perform its obligations under the Loan Documents. 

                    (r)      Cash
Management System. Borrowers have established cash management systems
acceptable to the Administrative Agent and Additional Collateral Agent, in iheir
discretion. 

                    (s)     
Due Diligence. The Administrative Agent and the Lender Parties shall have
completed all business, legal and collateral due diligence (including, without
limitation, completion by the Administrative Agent or its agents of an
examination and inspection of the Collateral, Borrowers’ financial information
including monthly projections, Borrowers’ historical performance and background
investigations of key members of management of the Borrowers), and the results
of such due diligence are satisfactory to the Administrative Agent and the
Lender Parties, in their sole discretion. 

                    (t)      Litigation.
There is no material action, suit, proceeding or investigation pending or
threatened against or affecting any Related Party before or by any court,
administrative agency or other governmental authority, except as may be
acceptable to Administrative Agent and Initial Lender.

                    (u)     
Other Matters. All other documents and legal matters in connection with
the transactions contemplated by this Agreement shall have been delivered,
executed and recorded and shall be in form and substance reasonably satisfactory
to Administrative Agent and its counsel. 

          Section
  4.2.      ALL ADVANCES.
  The obligation of any Lender to make any Loan Advance hereunder (including the
  initial Loan Advance) shall be subject to the further conditions precedent that,
  on and as of the date of such advance: (a) the representations and warranties
  of each Borrower and each Guarantor set forth in this Agreement and the other
  Loan Documents shall be accurate, before and after giving effect to such advance
  or issuance and to the application of any proceeds thereof; (b) no Default or
  Event of Default has occurred and is continuing, or would result from such advance
  or issuance or from the application of any proceeds thereof; (c) no material
  adverse change has occurred in the Borrowers’ business, operations, financial
  condition, or assets or in the prospect of repayment of the Indebtedness or
  the enforceability of the material terms of any Loan Document; (d) the applicable
  Custodian shall have received (i) the Consumer Loan Documents, all related Auto
  Titles (or, if applicable, “Title Guaranties” or “Title Applications”
  and “Title Receipts” (as such terms are defined in the Existing Carbiz
  Custodian Agreement)) and other documents, instruments and writings related
  to each Receivable and (ii) the Auto Titles (or, if applicable, “Title
  Guaranties” or “Title Applications” and “Title Receipts”)
  and other documents, instruments and writings related to each Automobile being
  financed by such advance and shall have provided a written certification regarding
  receipt of same to Administrative Agent; (e) Administrative Agent shall have
  received such other approvals, opinions or documents as Administrative Agent
  shall reasonably request; and (f) Borrower Representative shall have submitted
  to Administrative Agent a completed Request for Advance in the form and substance
  of Exhibit A attached hereto, on or before the Business Day preceding
  the date such advance is requested.

39 

          Section
4.3.      ALL ADVANCES TO
CONSTITUTE ONE LOAN . All evidences of credit, loans and advances
made by a Lender to Borrowers under this Agreement and any other documents or
instruments executed in connection herewith shall constitute one loan of such
Lender, and all indebtedness and obligations of Borrowers to Lender Parties
under this Agreement and all other such documents and instruments shall
constitute Indebtedness secured by Administrative Agent's and Additional
Collateral Agent’s liens and security interests, for the benefit of the Lender
Parties, in all of the Collateral and by all other Liens heretofore, now, or at
any time or times hereafter granted by a Borrower to Administrative Agent or
Additional Collateral Agent, for the benefit of the Lender Parties. Each
Borrower agrees that all of the rights of Lender Parties set forth in this
Agreement shall apply to any modification of or supplement to this Agreement and
any other such documents and instruments. 

          Section
4.4.      ADVANCES.
Administrative Agent shall have the right in Administrative Agent's discretion
(but shall not be required), subject to availability hereunder on behalf of and
without notice to Borrowers, to make and use Receivables Loan Advances and
Inventory Loan Advances to pay Lender Parties for any amounts due to Lender
Parties pursuant to this Agreement or any other Loan Document, or to cure any
default hereunder, notwithstanding the expiration of any applicable cure period
(and Administrative Agent shall be deemed a Lender hereunder with respect to any
Loan Advance so made). 

ARTICLE 5 
REPRESENTATIONS AND WARRANTIES OF
BORROWER AND RELATED PARTIES. 

          Section
5.1.      REPRESENTATIONS AND
WARRANTIES. To confirm Lender Parties’ understanding concerning the
Borrowers and Related Parties and their businesses, properties and obligations,
and to induce Lender Parties to enter into this Agreement and to extend credit
hereunder, each Borrower and each Guarantor party hereto hereby continuously,
including at any time a Request for Advance is provided to Administrative Agent,
represents and warrants to Lender Parties that, during the term of this
Agreement and so long as any Indebtedness remains outstanding: 

                    (a)     
Each Related Party is a corporation or limited liability company, as applicable
duly incorporated or organized, validly existing and in good standing under the
laws of the state of its incorporation or organization, is duly qualified to do
business and is in good standing as a foreign corporation in all states where
such qualification is required, has all necessary company power and authority to
enter into this Agreement and each of the other Loan Documents to which it is a
party and to perform all of its obligations hereunder and thereunder. 

                    (b)      Each
Related Party operates its business only under its legal name and the assumed
names listed on Schedule 5.1(b) of Schedule A attached hereto and except as set
forth on Schedule 5.1(b) of Schedule A, has not used any other assumed name or
prior legal name for the operation of its business activities for the previous
seven (7) years. 

                    (c)      Each
Related Party and JV Partner has all requisite right and power and is duly
authorized and empowered to enter into, execute, deliver and perform this
Agreement and 

40 

each other Loan Document to which it is a party and this
Agreement and each other Loan Document to which such Related Party is a party
are the legal, valid and binding obligations of such Related Party and are
enforceable against such Related Party in accordance with their terms. 

                    (d)     
Each Validity Guarantor is competent to enter into its respective Validity
Guaranty and to perform all of such Validity Guarantor's obligations thereunder.

                    (e)      The
execution, delivery and performance by each Related Party of this Agreement and
the other Loan Documents to which it is a party does not and shall not (i)
violate any provision of any Law, order, writ, judgment, injunction, decree,
determination or award presently in effect having applicability to such Person;
(ii) violate any provision of its charter documents, bylaws, limited liability
company agreement, operating agreement or partnership agreement, as applicable;
or (iii) result in a breach of or constitute a default under any indenture or
loan or credit agreement or any other agreement, lease or instrument to which
such Person is a party or by which it or any of its assets or properties may be
bound or affected; and no Related Party is in default of any such Law, order,
writ, judgment, injunction, decree, determination or award or any such
indenture, agreement, lease or instrument. 

                    (f)     
No consent, approval, license, exemption of or filing or registration with,
giving of notice to, or other authorization of or by, any court, administrative
agency or other governmental authority is or shall be required in connection
with the execution, delivery or performance by any Related Party of this
Agreement or any other Loan Document for the valid consummation of the
transactions contemplated hereby or thereby. 

                    (g)     
No event has occurred and is continuing which constitutes a Default or an Event
of Default. There is no action, suit, proceeding or investigation pending or, to
the knowledge of any Related Party, threatened against or affecting any Related
Party before or by any court, administrative agency, other governmental
authority or arbitrator of any kind that brings into question the validity of
the transactions contemplated hereby, or that could reasonably be expected to
result in any material adverse change in the businesses, assets, properties or
financial conditions of any Related Party.

                    (h)     
No Related Party is in default in the payment of any taxes levied or assessed
against it or any of its assets or properties, except for taxes being contested
in good faith and by appropriate proceedings. 

                    (i)     
Each Related Party has good and marketable title to its assets and properties as
reflected in its financial statements furnished to Administrative Agent. 

                    (j)      Each
of the financial statements furnished to Administrative Agent by the Related
Parties was prepared in accordance with GAAP and fairly and accurately reflects
their financial condition as of the date thereof; and each Related Party hereby
certifies that there have been no material adverse changes in their condition,
financial or otherwise, since the date of such statements, and there are no
known contingent liabilities not provided for or disclosed in such statements.

41 

                    (k)      Neither
this Agreement, any Availability Report or any statement or document referred to
herein or delivered to any Lender Party by any Related Party contains any untrue
statement of a material fact or omits to state a material fact necessary to make
the statements made herein or therein not misleading. 

                    (l)      Each
Related Party has good, indefeasible and merchantable title to and ownership of
its respective Collateral, free and clear of all Liens, except (i) those of
Administrative Agent and Additional Collateral Agent and (ii) Liens permitted
pursuant to Section 6.2(a) hereof.

                    (m)      All
books, records and documents relating to the Collateral are and shall be genuine
and in all respects what they purport to be; the original amount and the unpaid
balance of each Receivable shown on the books and records of each Borrower and
in the schedules represented as owing by each Account Debtor is and shall be the
correct amount actually owing or to be owing by such Account Debtor at maturity;
no Borrower or other Related Party has knowledge of any fact which would impair
the validity or collectibility of any of the Receivables; and the payments shown
to have been made by each Account Debtor on the books and records of Borrowers
shall reflect the amounts of and dates on which said payments were actually
made. 

                    (n)      Each
place of business of each Related Party is only at the locations set forth in
Section 5.1(n) of Schedule A attached hereto. No Related Party shall begin or do
business (either directly or through subsidiaries) at other locations or cease
to do business at any of the above locations or at Borrowers’ principal place of
business without first notifying Administrative Agent. 

                    (o)      The
present value of all benefits vested under all Plans of the Related Parties or
any Commonly Controlled Entity (based on the assumptions used to fund the Plans)
did not, as of the last annual valuation date (which in case of any Plan was not
earlier than December 31, 1982) exceed the value of the assets of the Plans
applicable to such vested benefits. 

                    (p)     
The liability to which any Related Party or any Commonly Controlled Entity would
become subject under Sections 4063 or 4064 of ERISA if such Related Party or any
Commonly Controlled Entity were to withdraw from all Multi-employer Plans or if
such Multi- employer Plans were to be terminated as of the valuation date most
closely preceding the date hereof, is not in excess of One Thousand and No/100
Dollars ($1,000.00); 

                    (q)      No
Related Party is engaged nor shall it engage, principally or as one of its
important activities, in a business of extending credit for the purpose of
“purchasing” or “carrying” any “margin stock” within the respective meanings of
each of the quoted terms under Regulations U or X of the Board of Governors of
the Federal Reserve System as now and from time to time hereafter in effect. No
part of the proceeds of any advances hereunder shall be used for “purchasing” or
“carrying” “margin stock” as so defined or for any purpose which violates, or
which would be inconsistent with, the provisions of the Regulations of such
Board of Governors. All of the outstanding securities of each Related Party have
been offered, issued, 

42 

sold and delivered in compliance with, or are exempt from, all
United States and Canadian federal, state, provincial, and local laws and rules
and all regulations of United States and Canadian federal, state and provincial
regulatory bodies governing the offering, issuance, sale and delivery of
securities. 

                    (r)     
No Related Party is an “investment company” or a company “controlled” by an
“investment company,” within the meaning of the Investment Company Act of 1940,
as amended. 

                    (s)      Each
of the Exhibits and Schedules to this Agreement contain true, complete and
correct information. 

                    (t)     
To the best of Related Parties’ knowledge, the land and improvements owned or
leased by each Related Party for use in its business operations are free of
dangerous levels of contaminates, oils, asbestos, radon, PCB's, hazardous
substances or waste as defined by federal, state or local environmental laws,
regulations or administrative orders or other materials, the removal of which is
required or the maintenance of which is prohibited, regulated or penalized by
any federal, state or local governmental authority. 

                    (u)      Each
Related Party is solvent, generally able to pay its obligations as they become
due, has sufficient capital to carry on its business and transactions and all
businesses and transactions in which it intends to engage, and the current value
of such Related Party’s assets, at fair saleable valuation, exceeds the sum of
its liabilities. No Related Party shall be rendered insolvent by the execution
and delivery of this Agreement and the other Loan Documents and the consummation
of the transactions contemplated hereby and thereby and the capital remaining in
each Related Party is not now and shall not foreseeably become unreasonably
small to permit such Related Party to carry on its business and transactions and
all businesses and transactions in which it is about to engage. No Related Party
intends to, nor does it reasonably believe it shall, incur debts beyond its
ability to repay the same as they mature. 

                    (v)      Administrative
Agent and Additional Collateral Agent have perfected first priority security
interests, for the benefit of the Lender Parties, in all of Related Parties’
right, title and interest in the Collateral, prior and superior to any other
Lien, except for Liens permitted under Section 6.2(a) hereof. 

                    (w)      There
are no material actions, suits or proceedings pending, or threatened against or
affecting the assets of any Related Party or the consummation of the
transactions contemplated hereby, at law, or in equity, or before or by any
governmental authority or instrumentality or before any arbitrator of any kind.
No Related Party is subject to any judgment, order, writ, injunction or decree
of any court or governmental agency. There is not a reasonable likelihood of an
adverse determination of any pending proceeding which would, individually or in
the aggregate, have a material adverse effect on the business operations or
financial condition of any Related Party. 

                    (x)      Section
5.1(x) of Schedule A attached hereto correctly and completely sets forth for
each Related Party, as applicable, (i) its full legal name and state of
organization, (ii) its 

43 

Federal Tax Identification Number; (iii) its chief executive
office, (iv) all prior names used in the last five (5) years (including, without
limitation, such Related Party’s predecessors in interest as a result of a
merger or consolidation) and (v) the charter or other similar organizational
identification number for such Related Party in its state or province of
organization. 

                    (y)      No
Related Party or Guarantor (i) is a person whose property or interest in
property is blocked or subject to blocking pursuant to Section 1 of Executive
Order 13224 of September 23, 2001 Blocking Property and Prohibiting Transactions
With Persons Who Commit, Threaten to Commit, or Support Terrorism (66 Fed. Reg.
49079 (2001)), (ii) engages in any dealings or transactions prohibited by
Section 2 of such executive order, or is otherwise associated with any such
person in any manner violative of Section 2, or (iii) is a Person on the list of
Specially Designated Nationals and Blocked Persons or subject to the limitations
or prohibitions under any other U.S. Department of Treasury’s Office of Foreign
Assets Control regulation or executive order. 

                    (z)     
Each Borrower and each Guarantor is in compliance with the Patriot Act. No part
of the proceeds of any of the Loans will be used, directly or indirectly, for
any payments to any governmental official or employee, political party, official
of a political party, candidate for political office, or anyone else acting in
an official capacity, in order to obtain, retain or direct business or obtain
any improper advantage, in violation of the United States Foreign Corrupt
Practices Act of 1977, as amended. 

          Section
5.2.      REPRESENTATIONS AND
WARRANTIES AS TO ELIGIBLE RECEIVABLES. With respect to the
Eligible Receivables, the Borrowers hereby continuously, including at any time a
Request for Advance is provided to Administrative Agent, represent and warrant
to Lender Parties that during the term of this Agreement and so long as any of
the Indebtedness remains unpaid that (i) in determining which Receivables are
“Eligible Receivables,” Administrative Agent may rely upon all statements or
representations made by Borrowers; (ii) those Receivables designated as Eligible
Receivables satisfy all of the requirements of “Eligible Receivables” set forth
in Section 1.1(a)(iii) of Schedule A hereto and (iii) the amounts of the face
value shown on any schedule of Receivables provided to Administrative Agent,
and/or all invoices or statements delivered to Administrative Agent with respect
to any Eligible Receivables, are actually and absolutely owing to Borrower and
are not contingent for any reason. 

          Section
5.3.      REPRESENTATIONS AND
WARRANTIES AS TO ELIGIBLE INVENTORY. With respect to the
Eligible Inventory, the Borrowers hereby continuously, including any time a
Request for Advance is provided to Administrative Agent, represent and warrant
to Lender Parties that during the term of this Agreement and so long as any of
the Indebtedness remains unpaid: (i) in determining which Automobile Inventory
are “Eligible Inventory,” Administrative Agent may rely upon all statements or
representations made by Borrowers; and (ii) the Automobile Inventory designated
as Eligible Inventory satisfy the requirements of “Eligible Inventory” set forth
herein. 

44 

ARTICLE 6 
COVENANTS AND OTHER AGREEMENTS 

          Section
6.1.      AFFIRMATIVE
COVENANTS. During the term of this Agreement and so long as any of
the Indebtedness remains unpaid and until Lender Parties’ obligations to make
Loan Advances under this Agreement have terminated, each Borrower and each
Guarantor party hereto agrees and covenants, jointly and severally, that they
shall:

                    (a)      Pay
or cause to be paid currently all of their expenses and Liabilities, including
all payments on their obligations whenever due, as well as all payments of any
and all taxes of whatever nature when due, including the payment of all sales
tax on consumer loans. This provision shall not apply to taxes or expenses which
are due, but which are challenged in good faith. 

                    (b)      Maintain,
preserve, and protect the Collateral, including, but not limited to, keeping all
Consumer Loan Documents and other written records otherwise evidencing the
Collateral in a fire proof cabinet (subject to the delivery requirements to the
Custodians set forth herein and in the Custodian Agreements).

                    (c)     
Furnish to Administrative Agent prompt written notice as to the occurrence of
any Default or Event of Default hereunder. 

                    (d)      Furnish
to Administrative Agent prompt notice of: (i) any development related to the
business, financial condition, properties or assets of any Related Party that
would have or has a materially adverse affect on such business, financial
condition, properties or assets, or ability to perform their obligations under
this Agreement and the other Loan Documents and (ii) any material and adverse
litigation or investigation to which any of them may be a party. 

                    (e)      Carry
on and conduct their business in the same manner and in the same fields of
enterprise as they are presently engaged, and each Related Party shall preserve
its existence, licenses or qualifications as a domestic corporation, limited
liability company or limited partnership, as applicable, in the jurisdiction of
its organization and as a foreign organization in every jurisdiction in which
the character of its assets or properties or the nature of the business
transacted by it at any time makes qualification as a foreign organization
necessary, and to maintain all other material organizational rights and
franchises, provided, however, nothing herein shall be construed to prevent any
Related Party from closing any retail location in the good faith exercise of its
business judgment.

                    (f)     
Comply, and cause each affiliate to comply, with all statutes, governmental
rules and regulations applicable to them and their business (including, without
limitation, applicable usury and consumer Laws).

                    (g)      Permit
and authorize Administrative Agent and allow Administrative Agent, (i) to,
without notifying any Related Party, make such inquiries or investigation
through business credit, other credit reporting services or other sources
concerning any Related Party as Administrative Agent, in its sole discretion,
shall deem appropriate (ii) to (upon prior written notice to the Borrower
Representative to the extent no Event of Default shall have occurred and 

45 

be continuing) inspect, audit and examine the Collateral at the
premises of Related Parties, and provide Administrative Agent and any of its
officers, employees and agents reasonable access to the properties, facilities,
advisors and employees (including officers) of each Related Party and each of
its Subsidiaries and to the Collateral, (iii) together with any of its officers,
employees and agents, to inspect, audit and make extracts from the books and
records of any Related Party and its Subsidiaries, and (iv) together with its
officers, employees and agents, to inspect, review, evaluate and make test
verifications and counts of the Receivables, Automobile Inventory and other
Collateral of any Related Party. 

                    (h)      Cause
all debt due from a Borrower to any of such Borrower’s direct or indirect
shareholders or equity interest holders or any other Person to be subordinated
to the Indebtedness pursuant to a subordination agreement in form and substance
satisfactory to Administrative Agent. 

                    (i)      Provide
Administrative Agent sixty (60) days prior written notice of any Borrower
initiating any activities in any state other than the then-Approved States.
Lender shall not provide financing for any Receivable generated in a state other
than the Approved States until Administrative Agent’s counsel has reviewed
applicable lending and homestead laws in such new state and Administrative Agent
has approved activities in such new state by adding such new state to the
Approved State list. 

                    (j)      Cause
each Consumer Loan Document to have only one original counterpart. 

                    (k)      Purchase
or make consumer loans evidenced by Consumer Loan Documents which are solely on
forms that are in compliance with applicable state and federal Laws. 

                    (l)      Deliver
to the applicable Custodian (or Administrative Agent or Additional Collateral
Agent) the original Consumer Loan Documents and all other documentation required
by Section 3.4 hereof to be governed by the terms of the Custodian Agreements.

                    (m)      [reserved]

                    (n)     
Maintain at all times the loan portfolio requirements set forth in Section
1.1(a)(i) through (v) and 1.1(b) of Schedule A attached hereto. 

                    (o)      Execute
and deliver to Administrative Agent such assignment documents in addition to the
stamp required in Section 3.6 hereof if reasonably requested by Administrative
Agent from time to time in connection with Administrative Agent’s ability to
transfer ownership of the Consumer Loan Documents to Administrative Agent or its
assigns, and all collateral securing the Consumer Loan Documents after and
during the occurrence of an Event of Default. 

                    (p)     
Provide Administrative Agent with evidence of Related Parties’ insurance
(including, without limitation, property damage and liability insurance) issued
by a reputable carrier, as reasonably required by Administrative Agent (which
insurance shall be in such 

46 

amounts and cover such risks as is customarily carried by
businesses similarly situated). This insurance shall reflect Administrative
Agent and Additional Collateral Agent, for the benefit of the Lender Parties, as
the loss payee or additional insured, as required by Administrative Agent, and
contain a provision that Administrative Agent shall be notified by the carrier
thirty (30) days prior to the termination or cancellation of any such insurance.

                    (q)      Maintain
at all times as executive officers and principals of the Borrowers, each of the
Validity Guarantors. 

                    (r)      At
  its own cost and expense, cause (and cause each Subsidiary of such Person) to
  be promptly and duly taken, executed, acknowledged and delivered all such further
  acts, documents and assurances as may from time to time be necessary or as Administrative
  Agent or the Required Lenders may from time to time reasonably request in order
  to carry out the intent and purposes of the Loan Documents and the transactions
  contemplated thereby, including all such actions to establish, create, preserve,
  protect and perfect a first priority Lien (subject only to Liens permitted under
  Section 6.2(a) hereof) in favor of Administrative Agent and Additional Collateral
  Agent, for the benefit of the Lender Parties on the assets of such Person and
  its Subsidiaries (including assets acquired after the date hereof).

                    (s)      Concurrently
with the acquisition by such Person or any of its Subsidiaries following the
date hereof of any owned real estate, such Person will (or will cause its
Subsidiaries to), within thirty (30) days following written request by
Administrative Agent, deliver or cause to be delivered to Administrative Agent,
with respect to such real estate, (i) a mortgage or deed of trust, as
applicable, in form and substance reasonably satisfactory to Administrative
Agent, executed by the title holder thereof, (ii) an ALTA lender's title
insurance policy issued by a title insurer reasonably satisfactory to
Administrative Agent in form and substance and in amounts reasonably
satisfactory to Administrative Agent insuring Administrative Agent's first
priority Lien on such real estate, free and clear of all defects and
encumbrances except Liens permitted under Section 6.2(a) hereof; (iii) a current
ALTA survey, certified to Administrative Agent by a licensed surveyor, in form
and substance reasonably satisfactory to Administrative Agent, and (iv) a
certificate, in form and substance acceptable to Administrative Agent, to
Administrative Agent from a national certification agency acceptable to
Administrative Agent, certifying that such real estate is not located in a
special flood hazard area; and in the case of any acquisition of real estate
that consists of a leasehold estate, such estoppel letters, consents and waivers
from the landlords and non-disturbance agreements from any holders of mortgages
or deeds of trust on such real estate as may be reasonably requested by
Administrative Agent, all of which shall be in form and substance reasonably
satisfactory to Administrative Agent.

                    (t)      The
End of Month Delinquency set forth in Section 12 of the Availability Report
shall be delivered to Administrative Agent by Borrowers hereunder as determined
pursuant to the Aging Procedures and Eligible Receivable Tests. 

                    (u)      Borrowers
shall cause each item of Automobile Inventory financed by the Lenders hereunder,
as well as each item of Automobile Inventory acquired and/or repossessed as the
result of the exercise of remedies by Borrowers against Account Debtors to be
equipped with 

47 

a SID/GPS Device within ten (10) Business Days of Borrowers’
acquisition or repossession of such Automobile Inventory. 

                    (v)     
Borrowers shall use their commercially reasonable efforts to, within thirty (30)
days of the Closing Date, deliver to Administrative Agent a landlord’s waiver
and consent in form and substance reasonably satisfactory to Administrative
Agent in respect of each of the business locations described on Section 5.1(n)
of Schedule A. 

          Section
  6.2.      NEGATIVE COVENANTS.
  During the term of this Agreement and until the Indebtedness secured hereby
  has been paid in full and all of Lenders’ obligations to make advances
  under this Agreement have terminated, each Borrower and each Guarantor party
  hereto jointly and severally covenants and agrees that they shall not, without
  Administrative Agent’s and Required Lenders' prior written consent, do
  any of the following:

                    (a)      Incur
or permit to exist any Lien with respect to the Collateral now owned or
hereafter acquired by any Borrower, except (i) Liens in favor of Administrative
Agent and Additional Collateral Agent, for the benefit of the Lender Parties,
(ii) purchase money security interests granted by the Borrowers in connection
with specific capital expenditures permitted pursuant to Section 6.2(f)(iv)
hereof, provided, however, that the amount of the purchase money security
interest shall not exceed one hundred percent (100%) of the purchase price of
the asset being acquired including finance charges and no asset of the Related
Parties other than the acquired asset is used to secure the purchase price
thereof, (iii) Liens imposed by law for taxes not yet due or which are being
contested in good faith by appropriate proceedings and with respect to which
adequate reserves are being maintained in accordance with GAAP, (iv) statutory
Liens of landlords and Liens of carriers, warehousemen, mechanics, materialmen
and other Liens imposed by law created in the ordinary course of business for
amounts not yet due or which are being contested in good faith by appropriate
proceedings and with respect to which adequate reserves are being maintained in
accordance with GAAP, (v) pledges and deposits made in the ordinary course of
business in compliance with workers' compensation, unemployment insurance and
other social security laws or regulations, (vi) deposits to secure the
performance of bids, trade contracts, leases, statutory obligations, surety and
appeal bonds, performance bonds and other obligations of a like nature, in each
case in the ordinary course of business, (vii) easements, zoning restrictions,
rights-of-way and similar encumbrances, including reversionary clauses, on real
property imposed by law or arising in the ordinary course of business that do
not secure any monetary obligations and do not materially detract from the value
of the affected property or materially interfere with the ordinary conduct of
business of the Borrowers and (viii) Liens consisting of deposits of cash
collateral to secure Liabilities permitted by clause (vi) of Section 6.2(f)
hereof, provided that the aggregate amount of cash collateral securing such
Liabilities does not exceed 100% of the undrawn face amount of all letters of
credit constituting such Liabilities and outstanding at any time. 

                    (b)      Delegate,
transfer or assign any of their obligations or liabilities under this Agreement
or any other Loan Document, or any part thereof, to any other Person. 

                    (c)     
Be a party to or participate in: (i) any merger or consolidation; (ii) any
purchase or other acquisition of all or substantially all of the assets or
properties or shares of any 

48 

class of, or any partnership or joint venture interest in, any
other Person (other than pursuant to the Asset Purchase Agreement); (iii) any
sale, transfer, conveyance or lease of all or substantially all of any Related
Party’s assets or properties; or (iv) any sale or assignment with or without
recourse of any Receivables.

                    (d)      Cause
or take any of the following actions with respect to any Related Party: (i)
redeem, retire, purchase or otherwise acquire, directly or indirectly, any
Related Party’s outstanding securities; or (ii) purchase or acquire, directly or
indirectly, any Related Party’s shares of capital stock, evidences of
indebtedness or other securities of any person or entity. 

                    (e)      Amend,
supplement or otherwise modify the Asset Purchase Agreement, any agreement,
document or instrument entered into in connection therewith or any Related
Party’s charter documents or bylaws, limited liability company agreement,
operating agreement or partnership agreement, as applicable, (i) which would, in
the case of the Asset Purchase Agreement and any agreement, document or
instrument entered into in connection therewith, be a material change to any
such agreement, document or instrument or be in any way adverse to any Related
Party (including, without limitation, any increase to the purchase price or
other payment obligations thereunder), (ii) have a material adverse affect on
the condition and operations, prospects or financial condition of any Related
Party, (iii) in a manner adverse to the Lender Parties or (iii) without
providing copies of any such amendment, supplement or modification to
Administrative Agent substantially contemporaneously with the adoption
thereof.

                    (f)      Incur,
assume or suffer to exist any Liabilities (including any contingent liabilities)
or otherwise become liable upon the obligations of any Person by assumption,
endorsement or guaranty thereof or otherwise other than (i) the Indebtedness,
(ii) accounts payable incurred in the ordinary course of business, (iii) the
Trafalgar Subordinated Debt, the Management Subordinated Debt and any other
Subordinated Debt approved by Administrative in writing in its sole discretion,
(iv) purchase money indebtedness in an aggregate outstanding amount not to
exceed $50,000 at any time relating to purchases by Borrowers of office
equipment, shop equipment and similar items, (v) Liabilities in respect of
letters of credit issued for the account of a Related Party in the ordinary
course of business, the aggregate undrawn face amount of which shall not exceed
$100,000 for all such letters of credit or (vi) other Liabilities consented to
in writing by Administrative Agent and Required Lenders. 

                   (g)      Directly
or indirectly make loans to, invest in, extend credit to, or guaranty the debt
of any Person, other than extensions of credit made by Borrowers in the ordinary
course of Borrowers’ business. 

                    (h)      Amend,
modify, or otherwise change in any respect any material agreement, instrument,
or arrangement (written or oral) by which such Related Party, or any of its
assets, are bound. 

                    (i)      [Reserved].

49 

                    (j)     
Change its name, convert from one type of entity to another type, change its
principal place of business, or make any material changes in the nature of its
business as carried on as of the date hereof; provided, however, a
Related Party may change its name as long as (i) such Related Party gives Lender
thirty (30) days prior written notice thereof, and (ii) such Related Party
executes and delivers, prior to any such name change, any and all documents and
agreements requested by Administrative Agent to confirm the continuation and
preservation of all Liens granted to Administrative Agent and Additional
Collateral Agent, for the benefit of the Lender Parties, hereunder. 

                    (k)      (i)
Make any expenditure or commitment or incur any obligation or enter into or
engage in any transaction except in the ordinary course of business (other than
the consummation of the acquisition under the Asset Purchase Agreement), (ii)
engage directly or indirectly in any business or conduct any operations except
in connection with or incidental to its present business and operations, (iii)
make any acquisitions of or capital contributions to or other investments in any
Person (other than the consummation of the acquisition under the Asset Purchase
Agreement), (iv) create or acquire any Subsidiary or (v) make any acquisitions
of material properties or assets of another Person unless expressly allowed
hereunder (including, without limitation, the acquisition under the Asset
Purchase Agreement) or otherwise consented to in writing by Administrative
Agent. 

                    (l)      Except
for transactions that are disclosed to Administrative Agent in advance of being
entered into and which contain terms that are no less favorable to the
applicable Borrower or Related Party, as the case may be, than those which might
be obtained from a third party not an Affiliate of any Related Party, directly
or indirectly, enter into or permit to exist any transaction (including the
purchase, sale, lease or exchange of any property or the rendering of any
service) with any Affiliate of a Related Party. 

                    (m)      Change
its fiscal year, without the prior written consent of Administrative Agent. 

                    (n)      Directly
or indirectly (a) declare, pay, make or set aside any amount for payment in
respect of any Subordinated Debt, except for regularly scheduled payments of
interest (but no voluntary prepayments) in respect of such Subordinated Debt
made in full compliance with the applicable Subordination Agreement; or (b)
amend or otherwise modify the terms of any Subordinated Debt if the effect of
such amendment or modification is to (i) increase the interest rate or fees on,
or change the manner or timing of payment of, such Subordinated Debt; (ii)
change the dates upon which payments of principal or interest are due on, or the
principal amount of such Subordinated Debt; (iii) change any event of default or
add or make more restrictive any covenant with respect to such Subordinated
Debt; (iv) change the prepayment provisions of such Subordinated Debt or any of
the defined terms related thereto; (v) change the subordination provisions
thereof (or the subordination terms of any guaranty thereof); or (vi) change or
amend any other term if such change or amendment would materially increase the
obligations of the obligor or confer additional material rights on any holder of
such Subordinated Debt in a manner adverse to Borrowers, any other Related Party
or any Lender Party. 

50 

                    (o)      Will
not, and will not permit any Subsidiary of such Person to, directly or
indirectly, declare, order, pay, make or set apart any sum for any Distribution;
provided that the foregoing shall not restrict or prohibit any Borrower
or Subsidiary of a Borrower from making dividends or distributions, directly or
indirectly, to a Borrower and shall not restrict or prohibit Distributions,
directly or indirectly, to Carbiz Parent at such times and in such amounts as
are necessary to permit: 

                              (i)     
purchases of shares of (or options to purchase shares of) equity interests in
Carbiz Parent or options therefor from employees of any Related Party upon their
death, termination of their employment or retirement, so long as (x) before and
after giving effect to any such dividend or distribution for such purpose, (i)
no Event of Default shall have occurred and be continuing, (ii) Borrowers and
Guarantors are in compliance on a pro forma basis with the financial covenants
set forth in Section 6.9 (as computed for the most recently ended month for
which information is available) and is in compliance with all other terms and
conditions of this Agreement and (iii) (x) Availability on Eligible Receivables
minus the then outstanding principal balance of the Receivables Loan is
equal to or greater than $150,000 and (y) such purchases or payments after the
date hereof do not exceed $50,000 in any fiscal year and do not exceed $150,000
in the aggregate from and after March 23, 2007; 

                              (ii)     
so long as no Event of Default shall have occurred and be continuing both before
and after giving effect to any such Distribution, (a) payment of taxes by Carbiz
Parent and (b) payment of administrative expenses (including without limitation
the payment of reasonable director fees) payable by Carbiz Parent in an
aggregate amount, with respect to all such administrative expenses, not to
exceed $150,000 in any fiscal year; or 

                              
(iii)      reimbursement of any equity
contributions made by Carbiz Parent to Carbiz USA or any of its Subsidiaries, in
an amount not to exceed $325,000, the proceeds of which were used by one or more
Borrowers to satisfy obligations owing to Persons in respect of vehicles “sold
but not bought” by the sellers under the Asset Purchase Agreement and acquired
by Carbiz AQ pursuant to the Asset Purchase Agreement and obligations in respect
of licensing and related expenses.

                    (p)      Establish
or maintain any deposit account, securities account or other similar account
with any financial institution unless such Related Person and Administrative
Agent shall have entered into an Account Control Agreement with such financial
institution; provided, that the cash collateral described in clause (viii) of
Section 6.2(a) hereof may be maintained in a deposit account at the financial
institution issuing the applicable letter(s) of credit without such deposit
account being covered by an Account Control Agreement so long as the amount of
funds on deposit at any one time in such deposit account does not exceed the
maximum amount of cash collateral permitted to be deposited into such deposit
account at any one time pursuant to clause (viii) of Section 6.2(a) hereof. 

51 

          Section
6.3.      REPORTING
REQUIREMENTS AND ACCOUNTING PRACTICES. During the term of
this Agreement and so long as any of the Indebtedness remains unpaid, each
Related Party agrees and covenants, jointly and severally, to maintain (a) a
modern system of accounting in accordance with GAAP or other systems of
accounting acceptable to Administrative Agent and (b) standard operating
procedures applicable to all of their locations with respect to the handling and
disposition of cash receipts and other proceeds of Collateral on a daily basis,
including the depositing thereof, aging of account receivables, record keeping
and such other matters as Administrative Agent may reasonably request. For the
purpose of determining compliance with the covenants and representations in the
Loan Documents, Administrative Agent shall have the right to recast any
financial statement or report presented to Administrative Agent by or on behalf
of any Related Party to comply with GAAP. During the term of this Agreement and
so long as any of the Indebtedness remains unpaid or any commitment to lend
hereunder is in effect, Borrowers shall keep a set of all material records
(including, without limitation, all files, books and records with respect to all
Receivables and Automobile Inventory) at a location with respect to which
Administrative Agent shall have received a collateral access agreement in form
and substance satisfactory to Administrative Agent. 

          Section
6.4.      ACCOUNT DEBTORS
ADDRESSES. Borrowers agree to furnish to Administrative Agent from
time to time, promptly upon request, a list of all Account Debtors' names and
their most current addresses. Borrowers agree that Administrative Agent may from
time to time, consistent with standard or generally accepted auditing practices,
verify the validity, amount and any other matters relating to the Receivables by
means of mail, telephone or otherwise, in the name of a Borrower and upon the
occurrence of an Event of Default in the name of Administrative Agent or such
other name as Administrative Agent may choose. 

          Section
6.5.      FINANCIAL
REPORTS. Related Parties shall furnish to the Administrative Agent
and its duly authorized representatives such information respecting the business
and financial condition of the Related Parties as the Administrative Agent may
reasonably request, and without any request, the following financial statements
and reports, in a form satisfactory to Administrative Agent: 

                    (a)      As
soon as available, and in any event within twenty (20) calendar days of the
close of each month, for the period ending as of the last day of the immediately
preceding calendar month: (i) a Loss to Liquidation Report in the form and
substance of Exhibit G attached hereto, (ii) a Compliance Certificate in
the form and substance of Exhibit E attached hereto; (iii) a Static Pool
Report in the form and substance of Exhibit H attached hereto; and (iv) a
report of all sales tax payments made by Borrowers for all consumer loans
originating in such month in form and substance reasonably acceptable to
Administrative Agent. 

                    (b)      On
the second (2nd) Business Day of each calendar week, for the period
ending as of the last Business Day of the immediately preceding calendar week,
(i) a Schedule of Receivables and Assignment in form and substance of Exhibit
D attached hereto, (ii) an Availability Report in the form and substance of
Exhibit C attached hereto and (iii) a Statement of Accounts Receivable
showing the detailed aging of each Receivable, specifying the amount of 

52 

any Receivable Loans arising as a result of the sale of any
Automobile Inventory separated by Lot Code, and otherwise in a form acceptable
to Administrative Agent in its sole discretion. 

                    (c)     
As soon as available, and in any event within twenty (20) calendar days after
the close of each month a copy of the consolidated and consolidating balance
sheet of Carbiz Parent and its consolidated Subsidiaries as of the close of the
preceding month, and the consolidated and consolidating statements of income,
retained earnings and cash flows of Carbiz Parent and its consolidating
Subsidiaries for the preceding month, each in reasonable detail showing in
comparative form the figures for the corresponding date and period in the
previous fiscal year (to the extent available to compare), prepared in
accordance with GAAP, consistently applied, provided that Administrative Agent
hereby agrees to hold such financial statements as confidential in accordance
with such Administrative Agent's customary procedures for handling confidential
information, except that disclosure of such information may be made (i) to its
respective agents, employees, Subsidiaries, Affiliates, attorneys, auditors,
professional consultants, rating agencies, insurance industry associations and
portfolio management services, (ii) to prospective transferees or purchasers of
any interest in the Loans or commitments to lend hereunder in accordance with
applicable securities laws, (iii) as required by law, subpoena, judicial order
or similar order and in connection with any litigation, (iv) as may be required
in connection with the examination, audit or similar investigation of a Related
Party and (v) to a Person that is a trustee, investment advisor, collateral
manager, servicer, noteholder or secured party in a securitization in connection
with the administration, servicing and reporting on the assets serving as
collateral for such securitization. 

                    (d)      As
soon as available, and in any event within ninety (90) calendar days after the
close of each fiscal year of Carbiz Parent and its consolidating Subsidiaries, a
copy of the consolidated and consolidating balance sheets of Carbiz Parent and
its consolidating Subsidiaries as of the close of such period and the
consolidated and consolidating statements of income, retained earnings and cash
flows of Carbiz Parent and its consolidating Subsidiaries for such period, and
all supporting schedules and footnotes thereto, all in detail reasonably
satisfactory to Administrative Agent, prepared in accordance with GAAP,
consistently applied. All such annual financial statements shall be audited by
Christopher, Smith, Leonard, Bristow & Stanell, P.A. or such other firm of
independent public accountants of recognized standing, selected by Carbiz Parent
and reasonably satisfactory to the Administrative Agent, in accordance with
GAAP, and shall be accompanied by the written statement of the accountants who
prepared the audited financial statements, certifying whether such accountants
have obtained knowledge of any Event of Default under the Loan Documents; 

                    (e)      As
soon as available, and in any event within forty-five (45) calendar days prior
to the close of each annual accounting period of the Borrowers, pro forma
balance sheets and statements of income, retained earnings and cash flows of
Carbiz Parent and its consolidating Subsidiaries for the next annual accounting
period (with such detail amongst the individual Borrowers as Administrative
Agent may reasonably request); 

                   (f)      As
soon as available, and in any event within forty-five (45) calendar days after
the end of each calendar year, financial statements of each Validity Guarantor
as of the 

53 

close of such period, such personal financial statement shall
be in form and detail satisfactory to Administrative Agent; 

                    (g)     
Promptly after receipt thereof, any additional written reports, management
letters or other detailed information contained in writing concerning
significant aspects of any Related Party’s or any of their subsidiary’s
operations or concerning significant aspects of any Related Party’s or any of
their subsidiary’s financial affairs, given to it by its independent public
accountants; 

                    (h)      Promptly
after receipt thereof and in no event more than five (5) Business Days
thereafter, a copy of each audit or other report made by any state or federal
agency of the books and records or assets of any Related Party of their
compliance or non-compliance with applicable laws relating to the underwriting,
origination, servicing and/or collection of loans; 

                    (i)      Promptly
(but never more than five (5) Business Days) after knowledge thereof shall have
come to the attention of any responsible officer of any Borrower, written notice
of (i) any threatened or pending litigation or governmental proceeding or labor
controversy against any Related Party which, if adversely determined, would have
a material adverse effect on the business, operations or financial condition of
any Related Party, or (ii) the occurrence of any Default or Event of Default
hereunder; 

                    (j)      As
soon as available, a copy of all federal and state tax returns filed by each
Related Party during the current fiscal year and each fiscal year hereafter; and

                    (k)      Within
ten (10) calendar days of a request therefor from the Administrative Agent, such
other information (whether financial or otherwise) regarding any Related Party
as the Administrative Agent shall reasonably require. 

Each of the financial statements furnished to the
Administrative Agent pursuant to subsections (c) and (d) of this Section shall
be accompanied by a written certificate signed by the Chief Financial Officer or
other authorized representative of the Borrowers, as the case may be, to the
effect that to the best of the Chief Financial Officer’s or applicable
authorized representative’s knowledge and belief no Default or Event of Default
has occurred during the period covered by such statements or, if any such
Default or Event of Default has occurred during such period, setting forth a
description of such Default or Event of Default and specifying the action, if
any, taken to remedy the same. 

          Section
6.6.      NOTICE OF
CHANGES. Borrowers shall promptly notify Administrative Agent in
writing of any change of their officers, directors or key employees; change of
location of its chief executive office; any acquisition, disposition or
reorganization of any subsidiary, affiliate or parent of any Related Party;
change of any Related Party’s name; death or withdrawal of any partner (if a
Borrower is a partnership); any sale or purchase out of the regular course of
any Related Party’s business; litigation of which any Related Party is a party
or governmental investigations of which any Related Party is a target; and any
other material change in the business or financial affairs of any Related Party.

54 

          Section
6.7.      NOTICE OF COMMERCIAL TORT
CLAIMS. Borrowers shall promptly notify Administrative Agent in
writing of any commercial tort claims Borrowers may bring against any Person,
including the name and address of each defendant, a summary of the facts, an
estimate of the Borrowers’ damages, copies of any complaint or demand letter
submitted by the Borrowers, and such other information as the Administrative
Agent may reasonably request. 

          Section
6.8.      OUTSIDE
DIRECTOR 

                    (a)      Without
the authorization and direction of its Outside Director (as defined below), no
Borrower shall: institute proceedings for itself to be adjudicated bankrupt or
insolvent; consent to the institution of a bankruptcy or insolvency proceeding
against it; file a petition seeking, or consent to, reorganization or relief
under any applicable federal or state law relating to bankruptcy; consent to the
appointment of a receiver, liquidator, assignee, trustee, sequestration (or
other similar official) for itself or a substantial part of its property; make
any assignment for the benefit of creditors; or admit in writing its inability
to pay its debts generally as they become due; or admit in writing its ability
to pay its debts generally as they become due. 

                    (b)      Without
the affirmative vote of its Outside Director, no Borrower shall: for itself (i)
liquidate or dissolve, in whole or in part; or (ii) amend any provisions of its
certificate/articles of incorporation or by-laws containing provisions similar
to those contained in this Section 6.8. 

                    (c)      Each
Borrower shall, prior to or within ten (10) Business days of the Closing Date,
promptly elect and at all times maintain at least one independent director (an
“Outside Director”), who shall be reasonably satisfactory to the
Administrative Agent and shall not have been at the time of such individual’s
appointment as Outside Director, and may not have been at any time during the
preceding five (5) years, a shareholder of, or an officer, director or employee
of any Borrower or its shareholders, Subsidiaries or Related Parties. Borrower
shall provide director’s and officer’s insurance coverage with respect to the
Outside Director, which coverage shall be reasonably satisfactory to the Outside
Directors.

          Section
6.9.      FINANCIAL
COVENANTS. During the term of this Agreement and so long as any
Indebtedness remains unpaid and until Lender Parties’ obligations to make Loan
Advances under this Agreement have terminated, each Borrower and each Guarantor
each agree and covenant, respectively, that they shall not: 

                    (a)      Permit
the Leverage Ratio determined at the end of any calendar month to be more than
the threshold levels determined in accordance with the last paragraph of this
Section 6.9. 

                    (b)      Permit
the Interest Coverage Ratio for Carbiz Parent and its consolidated Subsidiaries
determined at the end of any calendar month set forth below to be less than the
minimum ratio set forth below opposite such date: 

55 

	Date	Minimum
      Interest
Coverage Ratio 
	January 31, 2008 	1.50 
	February 29, 2008 	3.45 
	March 31, 2008 	3.30 
	April 30, 2008 	3.12 
	May 31, 2008 	2.99 
	June 30, 2008 	2.87 
	July 31, 2008 	2.78 
	August 31, 2008 	2.67 
	September 30, 2008 	2.57 
	October 31, 2008 	2.50 
	November 30, 2008 	2.43 
	December 31, 2008 	2.33 
	  	  
	January 31, 2009 	2.33 
	February 28, 2009 	2.31 
	March 31, 2009 	2.28 
	April 30, 2009 	2.25 
	May 31, 2009 	2.23 
	June 30, 2009 	2.20 
	July 31, 2009 	2.23 
	August 31, 2009 	2.20 
	September 30, 2009 	2.20 
	October 31, 2009 	2.16 
	November 30, 2009 	2.16 
	December 31, 2009 	1.95 
	  	  
	January 31, 2010 	2.08 
	February 28, 2010 and the last 	  
	day of each calendar month thereafter 	2.20 

                    (c)      Permit
Net Income for Carbiz Parent and its consolidated Subsidiaries determined for
the two (2) month period ending on any date set forth below to be less than the
amount set forth below opposite such date (amounts in parenthesis denote
negative numbers): 

	Date 	Minimum Net Income 
	  	  
	October 31, 2007 	($1,100,000) 
	November 30, 2007 	($260,000) 
	December 31, 2007 	$0 
	January 31, 2008 	$150,000 
	February 29, 2008 	$670,000 
	March 31, 2008 	$640,000 
	April 30, 2008 	$600,000 
	May 31, 2008 	$570,000 

56 

	June 30, 2008 	$540,000 
	July 31, 2008 	$520,000 
	August 31, 2008 	$490,000 
	September 30, 2008 	$460,000 
	October 31, 2008 	$440,000 
	November 30, 2008 	$420,000 
	December 31, 2008 	$390,000 
	January 31, 2009 	$390,000 
	February 28, 2009 	$380,000 
	March 31, 2009 	$370,000 
	April 30, 2009 	$360,000 
	May 31, 2009 	$350,000 
	June 30, 2009 	$340,000 
	July 31, 2009 	$340,000 
	August 31, 2009 	$330,000 
	September 30, 2009 	$330,000 
	October 31, 2009 	$320,000 
	November 30, 2009 	$320,000 
	December 31, 2009 	$260,000 
	  	  
	January 31, 2010 	$300,000 
	February 28, 2010 and the last 	  
	day of each calendar month thereafter 	$320,000

                    (d)      Permit
Tangible Net Worth for Carbiz Parent and its consolidated Subsidiaries
determined at the end of any calendar month to be less than the threshold levels
determined in accordance with the last paragraph of this Section 6.9.

                    (e)      Permit
the net loss of the Static Pool of Borrowers measured for the three (3) month
period ending on the last day of any calendar month to exceed thirty percent
(30%) for the Receivable Loan. 

                    (f)      Permit
the monthly total collections and monthly net principal collections percentage
minimums of Borrowers to be less than 8.00% and 4.20% of the prior month end
total Receivables, respectively. 

                    (g)     
Permit the Loss to Liquidation Ratio for the most recently ended three (3) month
period to exceed twenty percent (20%), provided, however, that in the
event the Loss to Liquidation Ration exceeds such percent, the Administrative
Agent may decrease the Receivables Advance Rate by the corresponding percentage
of such excess. If the Receivables Advance Rate has been decreased pursuant to
the preceding sentence and the Loss to Liquidation Ratio for any subsequent
three (3) month period is less than twenty percent (20%), then the
Administrative Agent shall be required to increase the Receivables Advance Rate
by a corresponding percentage to a percentage not to exceed sixty percent (60%).

57 

Borrowers acknowledge that Administrative Agent, Additional
Collateral Agent and Initial Lender have agreed to close the transactions
contemplated herein and fund the initial Loan Advances to be made on the Closing
Date even though Borrowers have failed to provide Administrative Agent and
Initial Lender with the relevant financial information to determine appropriate
financial covenant threshold levels for Sections 6.9(a) and 6.9(d) hereof. In
consideration of Administrative Agent, Additional Collateral Agent and Initial
Lender agreeing to close the transactions contemplated herein and funding the
initial Loan Advances to be made on the Closing Date, Borrowers hereby agree to
deliver to Administrative Agent, no later than fourteen (14) calendar days after
the Closing Date, projected balance sheets for Carbiz Parent and its
consolidated Subsidiaries for the month ended September 30, 2007 through the
month ending December 31, 2011, prepared on a monthly basis in form and detail
reasonably acceptable to Administrative Agent. Borrowers’ failure to timely
deliver such projected balance sheets to Administrative Agent shall result in an
immediate Event of Default. Upon receipt of such projected balance sheets
Administrative Agent and Borrowers shall negotiate in good faith to determine
financial covenant thresholds to be inserted into Sections 6.9(a) and 6.9(d)
hereof; provided that if Administrative Agent and Borrowers have not agreed on
such financial covenant thresholds prior to the twenty-first (21st)
day following the Closing Date, an immediate Event of Default shall be deemed to
have occurred and be continuing. To the extent Administrative Agent and
Borrowers have agreed upon financial covenant thresholds to be inserted into
Sections 6.9(a) and 6.9(d) hereof, each party hereto hereby agrees to enter into
such amendment to this Agreement as Administrative Agent shall reasonably
request to incorporate such financial covenant thresholds into such
Sections.

ARTICLE 7 
EVENTS OF DEFAULT AND REMEDIES 

          Section
7.1.      EVENTS OF
DEFAULT. The occurrence of any one or more of the following events
shall constitute an “Event of Default”: 

                    (a)      Any
Borrower or any Guarantor fails to pay the principal component of the Loans or
any interest thereon when due and payable, whether at a date for the payment of
a fixed installment or as a contingent or other payment becomes due and payable
or as a result of acceleration or otherwise; 

                    (b)     
Any Borrower or any Guarantor fails to pay any Indebtedness (other than the
Indebtedness in subsection (a) above) when due and payable, whether at a date
for the payment of a fixed installment or as a contingent or other payment
becomes due and payable or as a result of acceleration or otherwise, within five
(5) calendar days after same becomes due and payable. 

                    (c)     
If (i) any Borrower or any Guarantor fails or neglects to perform, keep or
observe any of the covenants set forth in Sections 3.4, 3.9, 6.1, 6.2, 6.8 or
6.9 hereof, (ii) any Borrower, any Guarantor, JV Partner or any Validity
Guarantor fails or neglects to perform, keep or observe any of the other terms,
provisions, conditions or covenants, contained in this Agreement, any of the
other Loan Documents or any other agreement or document executed in connection
with the transactions contemplated hereby and thereby, and the same is not cured
to 

58 

Administrative Agent's satisfaction within ten (10) days after
Administrative Agent has given written notice to Borrower Representative
identifying such default or (iii) any representation, warranty or certification
made by such Person herein or therein or in any certificate or other writing
delivered pursuant hereto shall prove to be untrue in any material respect as of
the date upon which the same was made or at any time thereafter. 

                    (d)     
If the validity or enforceability of any Lien granted to Administrative Agent or
Additional Collateral Agent, for the benefit of the Lender Parties, to secure
the Indebtedness shall be impaired in any respect or to any degree, for any
reason, or if any other Lien shall be created or imposed upon the Collateral,
unless such Lien is a Lien permitted pursuant to Section 6.2(a) hereof. 

                    (e)     
If any judgment or judgments in the aggregate against any Borrower or any
Related Party (net of any insurance for which the insurance company has admitted
liability) in an amount in excess of Fifty Thousand and No/100 Dollars
($50,000.00), or any attachment or other levy against the properties or assets
of any Borrower or any Related Party with respect to a claim for any amount in
excess of Fifty Thousand and No/100 Dollars ($50,000.00), remains unpaid,
unstayed on appeal, undischarged, unbonded or undismissed for a period of thirty
(30) days. 

                    (f)      Default
in the payment of any sum due under any instrument evidencing indebtedness for
borrowed money in excess of $50,000 (individually or in the aggregate) owed by
any Borrower or any other Related Party to any Person, or any other default
under such instrument of indebtedness for borrowed money that permits such
indebtedness for borrowed money to become due prior to its stated maturity or
permits the holders of such indebtedness for borrowed money to elect a majority
of the board of directors or manage the business of any Related Party.

                    (g)     
If a court or governmental authority of competent jurisdiction shall enter an
order, judgment or decree appointing, with or without a Borrower’s or any
Related Party’s consent or acquiescence, a receiver, custodian, liquidator,
trustee or other officer with similar powers of any Borrower or any Related
Party or of the whole or any substantial part of its properties or assets, or
approving a petition filed against any Borrower or any Related Party seeking
reorganization, arrangement, composition, readjustment, liquidation, dissolution
or similar relief under the federal bankruptcy laws or any other applicable law,
and such order, judgment or decree shall remain unvacated, unstayed or not set
aside for an aggregate of thirty (30) days (whether or not consecutive) from the
date of the entry thereof or if any petition seeking such relief shall be filed
against any Borrower or any Related Party and such petition shall not be
dismissed within thirty (30) days. 

                    (h)      An
event shall occur which shall have a material adverse affect on the condition
and operations or financial condition of any Borrower or any other Related Party
or the enforceability of the material terms of any Loan Document.

                    (i)      If
any Borrower or any other Related Party shall: (i) be generally not paying their
respective debts as they become due; (ii) file a petition in bankruptcy or a
petition to 

59 

take advantage of any insolvency act or other act for the
relief or aid of debtors; (iii) make an assignment for the benefit of their
creditors; (iv) consent to or acquiesce in the appointment of a receiver,
custodian, liquidator, trustee or other officer with similar powers of either of
their properties or assets; (v) file a petition or answer seeking
reorganization, arrangement, composition, readjustment, liquidation, dissolution
or similar relief under the federal bankruptcy laws or any other applicable law;
(vi) be adjudicated insolvent or be liquidated; (vii) admit in writing of their
inability to pay debts as they become due; (viii) voluntarily suspend
transaction of usual business; or (ix) take any action, corporate or otherwise,
for the purpose of any of the foregoing. 

                    (j)      Any
of the following shall occur: (i) entry of a court order that enjoins, restrains
or in any way prevents any Related Party from conducting all or any material
part of its business affairs in the ordinary course of business or (ii)
withdrawal or suspension of any license or authority required for the conduct of
any material part of any Borrower’s or any Related Party’s business. 

                    (k)     
If any Related Party, JV Partner or any Validity Guarantor gives notice of
termination or terminates its liability pursuant to its Guaranty Agreement
executed in conjunction with this Agreement. 

                    (l)      The
breach of any terms or conditions of either Custodian Agreement. 

                    (m)      Any
Loan Document securing the Indebtedness shall for any reason (other than
pursuant to the terms hereof and thereof) cease to create a valid and perfected
first priority Lien in the assets having an aggregate value in excess of
$25,000. 

                    (n)     
(i) Carbiz Parent shall cease to be the legal and beneficial owner of one
hundred percent (100%) of the issued and outstanding capital stock and other
equity interests of Carbiz USA, (ii) Carbiz USA shall cease to be the legal and
beneficial owner of (a) one hundred percent (100%) of the issued and outstanding
capital stock and other equity interests of Carbiz Auto and Carbiz AQ and (b) at
least fifty percent (50%) of the issued and outstanding membership interests and
other equity interests of Carbiz LLC, or (iii) JV Partner shall cease to be the
legal and beneficial owner of all membership and other equity interests of
Carbiz LLC not owned by Carbiz USA (in each case with respect to the foregoing
(i) through (iii), on a fully diluted basis). 

                    (o)      Carbiz
Parent shall be engaged in any type of business activity other than the
ownership of the capital stock and other equity interests of Carbiz USA,
performance of its obligations under the Loan Documents, Trafalgar Subordinated
Debt Documents and Management Subordinated Debt Documents to which it is a
party, maintenance of its corporate existence and activities ancillary to each
of the foregoing, or Carbiz Parent takes any action which would cause any other
Related Party to violate the provisions of Section 6.2 hereof. 

                    (p)      Any
Validity Guarantor shall die, become mentally incapacitated or otherwise become
unable to fulfill his duties as an executive officer and principal of the
Borrowers or any Guarantor (a “Departing Validity Guarantor”) unless the
Borrowers have 

60 

hired, within thirty (30) days of any such event, a Person
reasonably acceptable to Administrative Agent to replace such Departing Validity
Guarantor in the same executive officer capacity as the Departing Validity
Guarantor held prior to such event and such replacement executive officer
executes a Validity Guaranty in the same form and substance as the Validity
Guaranty to which such Departing Validity Guarantor was a party. 

                    (q)     
The amount of Borrower's Receivables in excess of a sixty (60) day contractual
delinquency shall exceed six percent (6%). 

                    (r)     
The Loss to Liquidation Ratio shall exceed twenty-five percent (25%).

                    (s)     
The failure of any Borrower to pay any sales tax on consumer loans as and when
due in excess of $10,000 (individually or in the aggregate) and Borrowers have
failed to cure any such breach within five (5) Business Days of obtaining
knowledge thereof.

                    (t)      The
failure of any Borrower to deliver to Administrative Agent, Additional
Collateral Agent or a Custodian (for the benefit of Administrative Agent and
Additional Collateral Agent), the Auto Titles as required herein. 

          Section
7.2.      ACCELERATION OF THE
INDEBTEDNESS. Upon the occurrence of an Event of Default described
in Sections 7.1(g) and (i) above, all of the Indebtedness shall thereupon be
immediately due and payable, without demand, presentment, notice of demand or
dishonor and nonpayment, protest, notice of protest, notice of intention to
accelerate, declaration or notice of acceleration, or any other notice or
declaration of any kind, all of which are hereby expressly waived by each
Borrower and each Guarantor. Upon any such acceleration, any obligation of the
Lenders to make any additional advances on the Loans shall be permanently
terminated and there shall automatically be added to the Indebtedness owing by
Borrowers to the Lenders, as liquidated damages for the early termination of the
credit facilities contemplated hereby, and not as a penalty, the Liquidated
Damages. During the continuance of any other Event of Default, the outstanding
principal balance together with all accrued but unpaid interest on the
Indebtedness and all other sums due and payable by Borrowers to any Lender Party
may, at the option of Administrative Agent and without demand, presentment,
notice of demand or dishonor and nonpayment, protest, notice of protest, notice
of intention to accelerate, declaration or notice of acceleration, or any other
notice or declaration of any kind, all of which are hereby expressly waived by
each Borrower and each Guarantor, be declared due and payable, and, if so
declared, shall immediately become due and payable. During the continuance of
any Event of Default, in accordance with Section 2.10 hereof, interest shall
accrue on the Indebtedness at the Default Rate, without notice or demand to any
Borrower or any Guarantor. 

          Section
7.3.      REMEDIES. If
any Default or Event of Default shall occur and be continuing, Administrative
Agent and Additional Collateral Agent may protect and enforce Lender Parties’
rights under the Loan Documents by any appropriate proceedings, including
proceedings for specific performance of any covenant or agreement contained in
any Loan Document and the following rights and remedies: 

61 

                    (a)      All
of the rights and remedies of a secured party under the UCC, as amended, or
other applicable Law. 

                    (b)      The
right, to the fullest extent permissible by law, to: (i) enter upon the premises
of any Related Party, or any other place or places where the Collateral is
located and kept, without any obligation to pay rent to any Related Party,
through self-help and without judicial process, without first obtaining a final
judgment or giving any Related Party notice and opportunity for a hearing on the
validity of Administrative Agent's or Additional Collateral Agent’s, for the
benefit of the Lender Parties, claim, and remove the Collateral therefrom to the
premises of Administrative Agent, Additional Collateral Agent or any agent of
any such Person, for such time as Administrative Agent or Additional Collateral
Agent may desire, in order to effectively collect and liquidate the Collateral;
and/or (ii) require any Related Party to assemble the Collateral and make it
available to Administrative Agent or Additional Collateral Agent at a place to
be designated by Administrative Agent or Additional Collateral Agent, as
applicable, in such Person’s reasonable discretion. 

                    (c)      The
right to sell or otherwise dispose of any or all Collateral in its then
condition at public or private sale or sales, in lots or in bulk, for cash or on
credit, all as Administrative Agent or Additional Collateral Agent, as
applicable, in its discretion, may deem advisable; provided that such sales may
be adjourned from time to time with or without notice. The Administrative Agent
and, if applicable, Additional Collateral Agent, shall give reasonable notice to
Related Parties of the time and place of any public sale of the Collateral or of
the time after which any private sale by Administrative Agent, Additional
Collateral Agent or, at their option, a broker, or any other intended
disposition thereof is to be made. Such notice shall be deemed reasonable if
mailed, postage prepaid, to Related Parties at the address of Related Parties
designated herein at least ten (10) Business Days before the date of any public
sale or at least ten (10) Business Days before the time after which any private
sale or other disposition is to be made unless applicable law requires
otherwise. 

                    (d)      Administrative
Agent and Additional Collateral Agent shall have the right to conduct such sales
on Related Parties' premises or elsewhere and shall have the right to use
Related Parties' premises without charge for such sales for such time or times
as Administrative Agent or Additional Collateral Agent may see fit.
Administrative Agent and Additional Collateral Agent are hereby granted a
license or other right to use, without charge, Related Parties’ labels,
copyrights, rights of use of any name, trade secrets, trade names, trademarks
and advertising matter, or any property of a similar nature, as it pertains to
the Collateral, in advertising for sale and selling any Collateral and Related
Parties' rights under all licenses and all franchise agreements shall inure to
Administrative Agent’s and Additional Collateral Agent’s benefit. The Related
Parties agree to hold Administrative Agent and Additional Collateral Agent
harmless from any liability arising out of Administrative Agent's or Additional
Collateral Agent’s use of Related Parties' premises, labels, copyrights, rights
of use of any name, trade secrets, trade names, trademarks and advertising
matter, or any property of a similar nature as it pertains to advertising for
sale, marshaling or selling the Collateral. 

                    (e)      Administrative
Agent and Additional Collateral Agent shall have the right to sell, lease or
otherwise dispose of the Collateral, or any part thereof, for cash, credit or
any 

62 

combination thereof, and any Lender Party may purchase all or
part of the Collateral at public or, if permitted by law, private sale and, in
lieu of actual payment of such purchase price, may set off the amount of such
price against the Indebtedness owing by Borrowers to such Lender Party. The
proceeds realized from the sale of any Collateral shall be applied first to
reasonable costs and expenses, attorney's fees, expert witness fees incurred by
Administrative Agent and/or Additional Collateral Agent for collection and for
acquisition, completion, protection, removal, storage, sale and delivery of the
Collateral; second to all Indebtedness, other than principal and interest,
outstanding under this Agreement or any other Loan Document; third to interest
due upon any of the Indebtedness; fourth to the principal balance owing on the
Indebtedness; and fifth the remainder, if any, to Borrowers, their successors or
assigns, or to whomsoever may be lawfully entitled to receive the same. If any
deficiency shall arise, Borrowers shall remain liable to Lender Parties
therefor. 

                    (f)      The
right to appoint or seek appointment of a receiver, custodian or trustee of
Borrowers or any of their properties or assets pursuant to court order. 

                    (g)      The
right to cease all advances hereunder. 

                    (h)     
The exercise of Administrative Agent's and Additional Collateral Agent’s rights
under each Pledge Agreement. 

                    (i)      The
exercise of Administrative Agent's and Additional Collateral Agent’s rights
under the Account Control Agreements. 

                    (j)      All
other rights and remedies that Lender Parties may have at law or in equity. 

Additionally, if any Default or Event of Default shall occur
and be continuing, Administrative Agent and Additional Collateral Agent, on
behalf of Lender Parties, may enforce the payment of any Indebtedness due to
Lender Parties or enforce any other legal or equitable right which Lender
Parties may have. All rights, remedies and powers conferred upon Lender Parties
under the Loan Documents shall be deemed cumulative and not exclusive of any
other rights, remedies or powers available under the Loan Documents or at Law or
in equity. 

          Section
7.4.      NO
WAIVER. No delay, failure or omission of Administrative Agent or
Additional Collateral Agent to exercise any right upon the occurrence of any
Default or Event of Default shall impair any such right or shall be construed to
be a waiver of any such Default or Event of Default or an acquiescence therein.
Lender Parties may, from time to time, in a writing waive compliance by the
other parties with any of the terms of this Agreement and its rights and
remedies upon any Default or Event of Default, and Borrowers agree that no
waiver by Lender Parties shall ever be legally effective unless such waiver
shall be acknowledged and agreed to in writing by Lender Parties. No waiver of
any Default or Event of Default by Lender Parties shall impair any right or
remedy of Lender Parties not specifically waived. No single, partial or full
exercise of any right of Lender Parties shall preclude any other or further
exercise thereof. No modification or amendment of or supplement to this
Agreement or any other written agreement between the parties hereto shall be
valid or effective (or serve as a basis of reliance by way of 

63 

estoppel) unless the same is in writing and signed by the party
against whom it is sought to be enforced. The acceptance by Administrative Agent
at any time and from time to time of a partial payment or partial performance of
any Related Party's obligations set forth herein shall not be deemed a waiver,
reduction, modification or release from any Default or Event of Default then
existing. No waiver by Lender Parties of any Default or Event of Default shall
be deemed to be a waiver of any other existing or any subsequent Default or
Event of Default. 

          Section
7.5.      APPLICATION OF
PROCEEDS . After an Event of Default shall have occurred and is
continuing, all amounts received by Lender Parties on account of any
Indebtedness and realized by Lender Parties with respect to the Collateral,
including any sums which may be held by Lender Parties, or the proceeds of any
thereof, shall be applied in the same manner as proceeds of Collateral as set
forth in Section 7.3(e) hereof. 

          Section
7.6.      APPOINTMENT OF
ADMINISTRATIVE AGENT AS ATTORNEY-IN-FACT. Each Borrower irrevocably
designates, makes, constitutes and appoints Administrative Agent (and all
persons reasonably designated by Administrative Agent, including, without
limitation, Additional Collateral Agent), with full power of substitution, as
Borrowers’ true and lawful attorney-in-fact (and not agent-in-fact) and
Administrative Agent, or Administrative Agent's agent, may, without notice to
any Borrower, and at such time or times thereafter as Administrative Agent or
said agent, in its discretion, may determine, in Borrowers’ or Administrative
Agent's name, at no duty or obligation on any Lender, do the following: 

                    (a)      Upon
the occurrence and during the continuance of any Default or Event of Default,
all acts and things necessary to fulfill Borrowers’ administrative duties
pursuant to this Agreement and the other Loan Documents; 

                    (b)      Upon
the occurrence and during the continuance of any Default or Event of Default,
all acts and things necessary to fulfill Borrowers’ obligations under this
Agreement and the Loan Documents, except as otherwise set forth herein, at the
cost and expense of Borrowers. 

                    (c)      In
addition to, but not in limitation of the foregoing, at any time or times upon
the occurrence and during the continuance of an Event of Default, Administrative
Agent shall have the right: (i) to enter upon Borrowers’ premises and to receive
and open all mail directed to Borrowers and remove all payments to Borrowers on
the Receivables; however, Administrative Agent shall turn over to Borrowers all
of such mail not relating to Receivables; (ii) in the name of Borrowers, to
notify the Post Office authorities to change the address for the delivery of
mail addressed to Borrowers to such address as Administrative Agent may
designate (notwithstanding the foregoing, for the purposes of notice and service
of process to or upon Borrowers as set forth in this Agreement, Administrative
Agent's rights to change the address for the delivery of mail shall not give
Administrative Agent the right to change the address for notice and service of
process to or upon Borrowers in this Agreement); (iii) demand, collect, receive
for and give renewals, extensions, discharges and releases of any Receivable;
(iv) institute and prosecute legal and equitable proceedings to realize upon the
Receivables; (v) settle, compromise, compound or adjust claims in respect of any
Receivable or any legal proceedings brought in respect thereof; (vi) generally,
sell in whole or in part for cash, credit or property to 

64 

others or to itself at any public or private sale, assign, make
any agreement with respect to or otherwise deal with any of the Receivables as
fully and completely as though Administrative Agent were the absolute owner
thereof for all purposes, except to the extent limited by any applicable Laws
and subject to any requirements of notice to Borrowers or other persons under
applicable Laws; (vii) take possession and control in any manner and in any
place of any cash or non-cash items of payment or proceeds of Receivables;
(viii) endorse the name of Borrowers upon any notes, acceptances, checks,
drafts, money orders, chattel paper or other evidences of payment of Receivables
that may come into Administrative Agent's possession; and (ix) sign Borrowers’
names on any instruments or documents relating to any of the Collateral, or on
drafts against Account Debtors. The appointment of Administrative Agent as
attorney-in-fact for Borrowers is coupled with an interest and is irrevocable.

ARTICLE 8 
ADMINISTRATIVE AGENT AND ADDITIONAL
COLLATERAL AGENT; ASSIGNMENTS 

         Section
8.1.      APPOINTMENT.
The Lenders hereby designate and appoint SWC Services, LLC, a Delaware limited
liability company, as their Administrative Agent on their collective behalf to
act as specified herein and in the other Loan Documents. The Lenders hereby
designate and appoint AGM, LLC, a Delaware limited liability company, as their
Additional Collateral Agent on their collective behalf to act as specified
herein and in the other Loan Documents. Each Lender hereby irrevocably
authorizes, and each holder of any Note by the acceptance of such Note shall be
deemed irrevocably to authorize, the Administrative Agent and Additional
Collateral Agent to take such action on its behalf under the provisions of this
Agreement, the other Loan Documents and any other instruments and agreements
referred to herein or therein and to exercise such powers and to perform such
duties hereunder and thereunder as are specifically delegated to or required of
the Administrative Agent or Additional Collateral Agent, as applicable, by the
terms hereof and thereof and such other powers as are reasonably incidental
thereto, including, without limitation, to execute and deliver the Loan
Agreement, each Subordination Agreement, the Custodian Agreements and any other
Loan Document necessary or useful in connection with the Indebtedness and Lender
Parties’ security interests relating thereto. Each of the Administrative Agent
and the Additional Collateral Agent may perform any of its duties hereunder by
or through its officers, directors, agents, employees or affiliates. 

          Section
8.2.      NATURE OF
DUTIES. Neither the Administrative Agent nor the Additional
Collateral Agent shall have any duties or responsibilities except those
expressly set forth in this Agreement and in the other Loan Documents. None of
the Administrative Agent, the Additional Collateral Agent nor any of their
officers, directors, agents, employees or affiliates shall be liable for any
action taken or omitted by any of them hereunder or under any other Loan
Document or in connection herewith or therewith, unless caused by its or their
gross negligence or willful misconduct (as determined by a court of competent
jurisdiction in a final and non-appealable decision). The duties of the
Administrative Agent and Additional Collateral Agent shall be mechanical and
administrative in nature; neither the Administrative Agent nor the Additional
Collateral Agent shall have by reason of this Agreement or any other Loan
Document a fiduciary relationship in respect of any Lender or the holder of any
Note; and nothing in this 

65 

Agreement or in any other Loan Document, expressed or implied,
is intended to or shall be so construed as to impose upon the Administrative
Agent or the Additional Collateral Agent any obligations in respect of this
Agreement or any other Loan Document except as expressly set forth herein or
therein. 

          Section
8.3.      LACK OF RELIANCE ON
THE ADMINISTRATIVE AGENT. Independently and without reliance upon
the Administrative Agent or Additional Collateral Agent, each Lender and the
holder of each Note, to the extent it deems appropriate, has made and shall
continue to make (i) its own independent investigation of the financial
condition and affairs of the Borrowers in connection with the making and the
continuance of the Loans and the taking or not taking of any action in
connection herewith and (ii) its own appraisal of the creditworthiness of the
Borrowers and, except as expressly provided in this Agreement, neither the
Administrative Agent nor the Additional Collateral Agent shall have any duty or
responsibility, either initially or on a continuing basis, to provide any Lender
or the holder of any Note with any credit or other information with respect
thereto, whether coming into its possession before the making of the Loans or at
any time or times thereafter. Neither the Administrative Agent nor the
Additional Collateral Agent shall be responsible to any Lender or the holder of
any Note for any recitals, statements, information, representations or
warranties herein or in any document, certificate or other writing delivered in
connection herewith or for the execution, effectiveness, genuineness, validity,
enforceability, perfection, collectibility, priority or sufficiency of this
Agreement or any other Loan Document or the financial condition of the Borrowers
or be required to make any inquiry concerning either the performance or
observance of any of the terms, provisions or conditions of this Agreement or
any other Loan Document, or the financial condition of the Borrowers or the
existence or possible existence of any Default or Event of Default. 

          Section
8.4.      CERTAIN RIGHTS OF
THE AGENTS. If the Administrative Agent or Additional Collateral
Agent requests instructions from the Lenders with respect to any act or action
(including failure to act) in connection with this Agreement or any other Loan
Document, the Person requesting such instructions shall be entitled to refrain
from such act or taking such action unless and until such Person shall have
received instructions from the Lenders; and such Person shall not incur
liability to any Lender by reason of so refraining. Without limiting the
foregoing, neither any Lender nor the holder of any Note shall have any right of
action whatsoever against the Administrative Agent or Additional Collateral
Agent as a result of the Administrative Agent or Additional Collateral Agent
acting or refraining from acting hereunder or under any other Loan Document in
accordance with the instructions of the Lenders. 

         Section
8.5.      RELIANCE.
The Administrative Agent and Additional Collateral Agent shall be entitled to
rely, and shall be fully protected in relying, upon any note, writing,
resolution, notice, statement, certificate, telex, teletype or telecopier
message, cablegram, radiogram, order or other document or telephone message
signed, sent or made by any Person that the Administrative Agent or Additional
Collateral Agent, as applicable, believed to be the proper Person, and, with
respect to all legal matters pertaining to this Agreement and any other Loan
Document and its duties hereunder and thereunder, upon advice of counsel
selected by the Administrative Agent and Additional Collateral Agent. 

66 

          Section
8.6.     
INDEMNIFICATION. To the extent the Administrative Agent,
Additional Collateral Agent or any affiliate thereof is not reimbursed and
indemnified by the Borrowers, the Lenders will reimburse and indemnify the
Administrative Agent, Additional Collateral Agent and any affiliate thereof in
proportion to their respective percentage of principal amount of Notes held by
them for and against any and all liabilities, obligations, losses, damages,
penalties, claims, actions, judgments, costs, expenses or disbursements of
whatsoever kind or nature which may be imposed on, asserted against or incurred
by the Administrative Agent, Additional Collateral Agent or any affiliate
thereof in performing its duties hereunder or under any other Loan Document or
in any way relating to or arising out of this Agreement or any other Loan
Document; provided, that no Lender shall be liable for any portion of such
liabilities, obligations, losses, damages, penalties, claims, actions,
judgments, suits, costs, expenses or disbursements resulting from the
Administrative Agent’s, Additional Collateral Agent’s or such affiliate’s gross
negligence or willful misconduct (as determined by a court of competent
jurisdiction in a final and non-appealable decision). 

          Section
8.7.      HOLDERS.
The Administrative Agent and Additional Collateral Agent may deem and treat the
payee of any Note as the owner thereof for all purposes hereof unless and until
a written notice of the assignment, transfer or endorsement thereof, as the case
may be, shall have been filed with the Administrative Agent. Any request,
authority or consent of any Person who, at the time of making such request or
giving such authority or consent, is the holder of any Note shall be conclusive
and binding on any subsequent holder, transferee, assignee or endorsee, as the
case may be, of such Note or of any Note or Notes issued in exchange therefor.
Notwithstanding anything in this Section, no Note or interest in any Note may be
transferred unless such transfer complies with Section 10.3 of this
Agreement. 

     Section
8.8.      RESIGNATION BY THE
AGENTS. 

                    (a)      The
Administrative Agent and/or the Additional Collateral Agent may resign from the
performance of all of its functions and duties hereunder and/or under the other
Loan Documents at any time by giving fifteen (15) Business Days prior written
notice to the Lenders. Such resignation shall take effect upon the appointment
of a successor Administrative Agent or Additional Collateral Agent, as
applicable, pursuant to clause (b) below or as otherwise provided below.

                    (b)      Upon
any such notice of resignation by the Administrative Agent or Additional
Collateral Agent, the Required Lenders shall appoint a successor Administrative
Agent or Additional Collateral Agent, as applicable, hereunder or thereunder,
which successor Administrative Agent or Additional Collateral Agent, as
applicable, shall be, so long as no Default or Event of Default shall have
occurred and be continuing, reasonably acceptable to the Borrowers, and which
acceptance shall not be unreasonably withheld or delayed. The Borrowers and
other Related Parties shall execute such documents and agreements and take such
action as the Lenders and any such successor Administrative Agent or Additional
Collateral Agent shall reasonably request to maintain the Liens of such
successor Administrative Agent and successor Additional Collateral Agent in the
assets of Borrowers and the other Related Parties to secure the Indebtedness and
otherwise carry out the intent and purposes of this Agreement and the other Loan
Documents. 

67 

          Section
8.9.      RELEASE OF
COLLATERAL. The Lenders hereby irrevocably authorize Administrative
Agent and Additional Collateral Agent, at their option and in their discretion,
to release any Lien granted to or held by them upon any Collateral (i) upon
payment and satisfaction of all Indebtedness (other than contingent
indemnification Indebtedness to the extent no claims giving rise thereto have
been asserted) and termination of all commitments to lend hereunder; or (ii)
constituting property being sold or disposed of if Borrower Representative
certifies to Administrative Agent and Additional Collateral Agent that the sale
or disposition is made in compliance with the provisions of this Agreement (and
Administrative Agent and Additional Collateral Agent may rely in good faith
conclusively on any such certificate, without further inquiry). 

          Section
8.10.      CONFIRMATION
OF AUTHORITY; EXECUTION OF RELEASES. Without in any manner
limiting Administrative Agent’s and Additional Collateral Agent’s authority to
act without any specific or further authorization or consent by Lenders, each
Lender agrees to confirm in writing, upon request by Administrative Agent or
Additional Collateral Agent, as applicable, the authority to release any
Collateral conferred upon Administrative Agent and Additional Collateral Agent
hereunder. Upon receipt by Administrative Agent or Additional Collateral Agent
of any required confirmation from the Required Lenders of its authority to
release any particular item or types of Collateral, Administrative Agent or
Additional Collateral Agent, as applicable, shall (and is hereby irrevocably
authorized by Lenders to) execute such documents as may be necessary to evidence
the release of the liens granted to such Person upon such Collateral; provided,
however, that (i) neither Administrative Agent nor Additional Collateral Agent
shall be required to execute any such document on terms which, in such Person’s
opinion, would expose such Person to liability or create any obligation or
entail any consequence other than the release of such liens without recourse or
warranty, and (ii) such release shall not in any manner discharge, affect or
impair the indebtedness evidenced by the Notes or any Liens upon (or
Indebtedness of Borrowers, in respect of), all interests retained by Borrowers,
including (without limitation) the proceeds of any sale, all of which shall
continue to constitute part of the Collateral. 

          Section
8.11.      ABSENCE OF
DUTY. Neither Administrative Agent nor Additional Collateral Agent
shall have any obligation whatsoever to any Lender or any other Person to assure
that the Collateral exists or is owned by Borrowers or is cared for, protected
or insured or has been encumbered or that the Liens granted to Administrative
Agent and Additional Collateral Agent have been properly or sufficiently or
lawfully created, perfected, protected or enforced or are entitled to any
particular priority, or to exercise at all or in any particular manner or under
any duty of care, disclosure or fidelity, or to continue exercising, any of the
rights, authorities and powers granted or available to Administrative Agent
and/or Additional Collateral Agent in any of the Loan Documents, it being
understood and agreed that in respect of any Collateral or any act, omission or
event related thereto, Administrative Agent and Additional Collateral Agent may
act in any manner that they may deem appropriate, in their discretion and
provided that Administrative Agent and Additional Collateral Agent shall
exercise the same care which they would in dealing with loans for their own
account. 

          Section
8.12.      AGENCY FOR
PERFECTION. Each Lender hereby appoints Administrative Agent and
Additional Collateral Agent as agent for the purpose of perfecting 

68 

such Lender’s security interest in that portion of the
Collateral which, in accordance with the Uniform Commercial Code in any
applicable jurisdiction, can be perfected by possession or control. Each Lender
agrees that it will not have any right individually to enforce or seek to
enforce this Agreement or to realize upon any Collateral for the Notes unless
consented to by Administrative Agent and Additional Collateral Agent, it being
understood and agreed that such rights and remedies may be exercised only by
Administrative Agent and Additional Collateral Agent. Nothing herein is intended
or shall be construed to limit any Lender’s rights under its Note, including the
right to enforce, accelerate, amend, compromise or otherwise administer such
Note. 

          Section
8.13.      AMENDMENTS,
CONSENTS AND WAIVERS. 

                    (a)      Except
as otherwise provided herein and except as to matters set forth in other
subsections hereof or in any other Loan Document as requiring only
Administrative Agent’s or Additional Collateral Agent’s consent, the consent of
Required Lenders (it being understood that consent of the “Lender Parties” shall
be deemed to mean consent of the Administrative Agent and Required Lenders) will
be required to amend, modify, terminate, or waive any provision of this
Agreement or any of the other Loan Documents; provided, however, that if such
amendment, modification, termination or waiver applies only to a certain Loan
Advance or Loan Advances, only the consent of the Lender or Lenders with respect
to such Loan Advance(s) shall be required. 

                    (b)      In
the event Administrative Agent or Additional Collateral Agent requests the
consent of a Lender and does not receive a written consent or denial thereof
within ten (10) Business Days after such Lender's receipt of such request, then
such Lender will be deemed to have given such consent. 

ARTICLE 9 
EXPENSES AND INDEMNITIES 

          Section
9.1.      PAYMENT FOR
EXPENSES. Borrowers shall pay (on the date of the initial funding
of the Loans and, thereafter, within thirty (30) days after any invoice or other
statement or notice), all costs and expenses incurred by Lender Parties or any
of their affiliates in connection with the transactions contemplated by the Loan
Documents, including, without limitation, (a) all documentation and diligence
fees and expenses, (b) all search, appraisal, recording, professional and filing
fees and expenses and all other out-of-pocket charges and expenses (including,
without limitation, (i) UCC and judgment and tax lien searches and UCC filings
and fees for post-closing UCC, (ii) judgment and tax lien searches, (iii) wire
transfer fees and (iv) any documentary, filing or stamp taxes in connection with
any grant or perfections of Administrative Agent’s and Additional Collateral
Agent’s Liens on the Collateral), (c) all audit fees and expenses, (d) all of
Lender Parties’ attorneys’ fees and expenses, but only to the extent incurred by
a Lender Party or any of its affiliates after a Default or Event of Default or
incurred by a Lender Party in connection with (i) any effort to enforce, protect
or collect payment of any Indebtedness or to enforce any Loan Document or any
related agreement, document or instrument, or effect collection hereunder or
thereunder, (ii) entering into, negotiating, preparing, reviewing and executing
this Agreement and the other Loan Documents and all related 

69 

agreements, documents and instruments, (iii) instituting,
maintaining, preserving, enforcing and foreclosing on Administrative Agent’s
and/or Additional Collateral Agent’s Liens, for the benefit of the Lender
Parties, in any of the Collateral or securities pledged under the Loan
Documents, whether through judicial proceedings or otherwise, (iv) defending or
prosecuting any actions, claims or proceedings arising out of or relating to
Lender Parties’ transactions with any Borrower unless there is a final judgment
by a court which finds such Lender Party to have acted in gross negligence or
willful misconduct in connection therewith, or (v) any modification,
restatement, supplement, amendment, waiver, forbearance or extension of this
Agreement or any other Loan Document or any related agreement, document or
instrument, and all of the same may be charged to Borrowers’ account and shall
be part of the Indebtedness. Each Borrower hereby further agrees to pay all of
each Custodian’s fees and expenses owing under the Custodian Agreements. 

          Section
9.2.      GENERAL
INDEMNIFICATION. Each Borrower hereby agrees to indemnify and hold
each Lender Party harmless, on demand, from and against any and all claims,
liabilities, obligations, losses, damages, penalties, fines, actions, judgments,
suits, costs, expenses or disbursements actually incurred (collectively
“Claim” or “Claims”) of any kind or nature whatsoever, asserted by
any party other than a Borrower, or with respect to a Borrower only as otherwise
provided in this Agreement or pursuant to applicable law regarding such Lender'
Party’s obligations to Borrowers, which may be imposed on, incurred by or
asserted against such Lender Party, or any of its officers, directors, employees
or agents (including accountants, attorneys or other professionals hired by such
Lender Party) in any way relating to or arising out of the Loan Documents or any
action taken or omitted by Lender, or any of its officers, directors, employees
or agents (including accountants, attorneys or other professionals hired by such
Lender Party) under the Loan Documents, except to the extent such indemnified
matters are finally found by a court to be caused by such Lender Party's gross
negligence or willful misconduct. 

ARTICLE 10 
MISCELLANEOUS 

          Section
10.1.      NOTICES.
All notices, demands, billings, requests and other written communications
hereunder shall be deemed to have been properly given: (i) upon personal
delivery; (ii) on the third Business Day following the day sent, if sent by
registered or certified mail; (iii) on the next Business Day following the day
sent, if sent by overnight express courier; or (iv) on the day sent or if such
day is not a Business Day on the next Business Day after the day sent if sent by
telecopy providing the receiving party has acknowledged receipt by return
telecopy, in each case, to each Lender Party and each Related Party or Guarantor
at its address and/or telecopy number as set forth in this Agreement or Section
10.1 of Schedule A attached hereto, or at such other address and/or telecopy
number as either party may designate for such purpose in a written notice given
to the other party. Administrative Agent and the Lenders shall have the right,
on or after initial funding pursuant to the terms of this Agreement and after
the Borrowers or Carbiz Parent has made such an announcement or release, to
issue a press release or other brochure announcing the consummation of the Loan
Documents and to distribute that information to third parties in the normal
course of such Person’s business, at no cost to Borrowers. 

70 

          Section
10.2.      APPOINTMENT OF
BORROWER REPRESENTATIVE. Each Borrower and Related Party
hereby designates the Borrower Representative as its representative and agent on
its behalf for the purposes (as applicable) of issuing Requests for Advances,
giving instructions with respect to the disbursement of the proceeds of the Loan
Advances, effecting repayment of the Loans, and giving and receiving all other
notices and consents hereunder or under any of the other Loan Documents and
taking all other actions (including in respect of compliance with covenants) on
behalf of any Borrower or Related Party under the Loan Documents. Borrower
Representative hereby accepts such appointment. Administrative Agent and each
Lender Party may regard any notice or other communication pursuant to any Loan
Document from Borrower Representative as a notice or communication from all
Borrowers and Related Parties, and shall give any notice or communication
required or permitted to be given to any Borrower or Related Party hereunder to
Borrower Representative on behalf of such Borrower or Related Party. Each
Borrower and Related Party agrees that each notice, election, representation and
warranty, covenant, agreement and undertaking made on its behalf by Borrower
Representative shall be deemed for all purposes to have been made by such
Borrower and Related Party and shall be binding upon and enforceable against
such Borrower and Related Party to the same extent as if the same had been made
directly by such Borrower or Related Party. The Borrowers may, upon fifteen (15)
days prior written notice to Administrative Agent by each of the Borrowers,
appoint a substitute Borrower as “Borrower Representative” to Administrative
Agent. 

          Section
10.3.      ASSIGNMENTS AND
PARTICIPATIONS. 

                    (a)      Any
Lender may sell any participation interest in its commitment hereunder or any of
its rights under its Loans or under the Loan Documents to any Person so long as
the agreement between such Lender and such participant at all times provides:
(i) that such participation exists only as a result of the agreement between
such participant and such Lender and that such transfer does not give such
participant any right to vote as a Lender or any other direct claims or rights
against any Person other than such Lender, (ii) that such participant is not
entitled to payment from Borrowers hereunder of amounts in excess of those
payable to such Lender under such sections (determined without regard to the
sale of such participation), and (iii) unless such participant is an affiliate
of such Lender, that such participant shall not be entitled to require such
Lender to take any action under any Loan Document or to obtain the consent of
such participant prior to taking any action under any Loan Document, except for
actions which would require the consent of all Lenders hereunder. No Lender
selling such a participation shall, as between the other parties hereto or to
any other Loan Document and such Lender, be relieved of any of its obligations
hereunder or thereunder as a result of the sale of such participation. Each
Lender which sells any such participation to any Person (other than an affiliate
of such Lender) shall give prompt notice thereof to Administrative Agent and
Borrower Representative. 

                    (b)     
In addition to sales of participations under the immediately preceding
subsection, any Lender may make any assignment or transfer of any kind of its
commitments or any of its rights under its Loans or under the Loan Documents
(which rights may be limited to a particular Loan Advance) in accordance with
the terms of this Section 10.3; provided, however, that such Lender shall not
offer, sell or otherwise, dispose of all or any part of its commitments 

71 

or Loans except under circumstances which will not result in a
violation of the Act or applicable state securities laws. To the extent
indicated in any document, instrument or agreement so selling, assigning, or
otherwise transferring to an assignee (an “Assignee”) such rights and/or
duties, (i) the Assignee shall acquire all of the assigning Lender’s rights
under the Agreement and the other Loan Documents and (ii) the Assignee shall be
deemed to be a “Lender” under this Agreement and the other Loan Documents with
the authority to exercise such rights in the capacity of such Lender. Subject to
applicable securities laws, Related Parties hereby authorize each Lender to
disseminate any information it has pertaining to the Indebtedness, including
without limitation, complete and current credit information on Related Parties
and Guarantors and any of their principals to any Assignee or prospective
Assignee. Any assignment pursuant to this Section 10.3 shall be made pursuant to
an Assignment and Acceptance. 

                    (c)     
Administrative Agent shall maintain at its office a copy of each Assignment and
Acceptance delivered to it and a register for the recordation of the names and
addresses of Lenders, and the commitments of, and principal amount of the
Indebtedness and Loans owing to each Lender pursuant to the terms hereof from
time to time (the “Register”). The entries in the Register shall be
presumptive evidence of the amounts due and owing to Lenders in the absence of
manifest error. Borrowers, Administrative Agent and each Lender may treat each
Person whose name is recorded in the Register pursuant to the terms hereof as a
Lender hereunder for all purposes of this Agreement. The Register shall be
available for inspection by Borrowers and any Lender, at any reasonable time
upon reasonable prior notice. 

                    (d)      Upon
its receipt of a duly completed Assignment and Acceptance executed by an
assigning Lender and its Assignee (together with the Note(s) subject to such
assignment), evidence satisfactory to the Administrative Agent that such
assignment complies with subsection (b) above, Administrative Agent shall (a)
accept such Assignment and Acceptance and (b) record the information contained
therein in the Register. If requested by Administrative Agent, Borrowers shall
promptly execute and deliver to Administrative Agent new Note(s) evidencing the
Indebtedness owed by Borrowers to the assignee and, if applicable, the assigning
Lender, after giving effect to the assignment. Administrative Agent shall cancel
the Notes delivered to it by the assigning Lender and deliver the new Notes to
the Assignee and, unless the assigning Lender has assigned all of its interests
under this Agreement, the assigning Lender. 

                    (e)      Any
Lender may at any time, following written notice to Administrative Agent, (a)
pledge the Indebtedness held by it or create a security interest in all or any
portion of its rights under this Agreement or the other Loan Documents in favor
of any Person; provided, however, that (i) no such pledge or grant of security
interest to any Person shall release such Lender from its Indebtedness hereunder
or under any other Loan Document and (ii) the acquisition of title to such
Lender’s Indebtedness pursuant to any foreclosure or other exercise of remedies
by such Person shall be subject to the provisions of this Agreement and the
other Loan Documents in all respects; and (b) assign all or any portion of its
funded Loans to an affiliate of such Lender, to one or more other Lenders or to
an affiliate of such other Lender. 

                    (f)     
Except as otherwise provided herein, no Lender shall, as between Borrowers and
that Lender, be relieved of any of its Indebtedness hereunder as a result of any

72 

sale, assignment, transfer or negotiation of, or granting of a
participation in, all or any part of the Loans, the Notes or other Indebtedness
owed to such Lender. 

          Section
10.4.      SURVIVAL OF
AGREEMENTS. All of the various representations, warranties,
covenants and agreements of Borrowers and Guarantors (including without
limitation, any agreements to pay costs and expenses and to indemnify any Lender
Party) in the Loan Documents shall survive the execution and delivery of the
Loan Documents and the performance under such Loan Documents, and Administrative
Agent and Additional Collateral Agent, for the benefit of the Lender Parties,
shall retain their Liens in the Collateral and all of their rights and remedies
under the Loan Documents notwithstanding any termination of financing under this
Agreement until all Indebtedness is fully performed and paid in full in cash.
All indemnity obligations and all other obligations to pay costs and expenses of
the Borrowers and Guarantors hereunder and under the other Loan Documents shall
survive payment of the Indebtedness in full. 

          Section
10.5.      NO OBLIGATION BEYOND
MATURITY. Each Borrower and each Guarantor agrees and acknowledges
that upon the Maturity Date with respect to a particular Loan, no Lender Party
shall have any obligation to renew, extend, modify or rearrange such Loan and
Lender Parties shall have the right to require all amounts due and owing under
the applicable Loans to be paid in full upon such date. 

          Section
10.6.      PRIOR AGREEMENTS
SUPERSEDED. This Agreement, together with the other Loan Documents,
constitute the sole and only agreement of the parties hereto and supersede any
prior understandings or written or oral agreements between the parties
respecting the subject matter of this Agreement and the other Loan Documents. No
provision of this Agreement or other Loan Document may be modified, waived or
terminated except by instrument in writing executed by the party against whom a
modification, waiver or termination is sought to be enforced. 

          Section
10.7.      PARTIES
BOUND. This Agreement shall be binding on and inure to the benefit
of the parties hereto and their respective heirs, executors, administrators,
legal representatives, successors and assigns, except as otherwise expressly
provided for herein. No Related Party shall assign any of its rights or
obligations pursuant this Agreement. 

          Section
10.8.      NO THIRD PARTY
BENEFICIARY. This Agreement is for the sole benefit of
Administrative Agent, Additional Collateral Agent, the Lenders and Borrowers and
is not for the benefit of any third party. 

          Section
10.9.      EXECUTION IN
COUNTERPARTS. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed and delivered shall be deemed to be an original, and all of
which taken together shall constitute but one and the same instrument.
Signatures delivered by facsimile, email (in .pdf format) and/or other similar
electronically transmitted format shall bind the parties hereto as though such
signatures were original. 

73 

          Section
10.10.      SEVERABILITY OF
PROVISIONS. Any provision which is determined to be unconscionable,
against public policy or any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof or affecting the validity or enforceability of such
provision in any other jurisdiction. 

          Section
10.11.      FURTHER
INSTRUMENTS. Each Borrower and each Guarantor shall from time to
time execute and deliver, and shall cause each of its subsidiaries to execute
and deliver, all such amendments, supplements and other modifications hereto and
to the other Loan Documents and all such financing statements or continuation
statements, instruments of further assurance and any other instruments, and
shall take such other actions, as Administrative Agent or Additional Collateral
Agent reasonably requests and deems necessary or advisable in furtherance of the
agreements contained herein. 

          Section
10.12.      GOVERNING
LAW. EXCEPT TO THE EXTENT THAT THE LAW OF ANOTHER JURISDICTION IS
EXPRESSLY ELECTED IN A LOAN DOCUMENT, THE LOAN DOCUMENTS SHALL BE DEEMED
CONTRACTS AND INSTRUMENTS MADE UNDER THE LAWS OF THE STATE OF ILLINOIS AND SHALL
BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE
STATE OF ILLINOIS AND THE LAWS OF THE UNITED STATES OF AMERICA, WITHOUT REGARD
TO PRINCIPLES OF CONFLICTS OF LAW.

          Section
10.13.      JURISDICTION AND
VENUE. TO INDUCE THE LENDER PARTIES TO ENTER INTO THIS AGREEMENT,
EACH PARTY HERETO IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF ANY
FEDERAL COURT OR ILLINOIS STATE COURT SITTING IN CHICAGO, ILLINOIS, AND EACH
PARTY IRREVOCABLY WAIVES ANY OBJECTION WHICH IT MAY HAVE AT ANY TIME TO THE
LAYING OF VENUE OF ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING
HERETO BROUGHT IN ANY SUCH COURT. EACH PARTY IRREVOCABLY WAIVES ANY CLAIM THAT
ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT
IN ANY INCONVENIENT FORUM AND FURTHER IRREVOCABLY WAIVES THE RIGHT TO OBJECT,
WITH RESPECT TO SUCH CLAIM, SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH
COURT, THAT SUCH COURT DOES NOT HAVE JURISDICTION OVER SUCH PARTY, PROVIDED THAT
SERVICE OF PROCESS IS MADE BY ANY LAWFUL MEANS. THE RELATED PARTIES HEREBY WAIVE
PERSONAL SERVICE OF ANY AND ALL PROCESS AND AGREES THAT ALL SUCH SERVICE OF
PROCESS MAY BE MADE UPON SUCH RELATED PARTY BY CERTIFIED OR REGISTERED MAIL,
RETURN RECEIPT REQUESTED, AND SERVICE SO MADE SHALL BE COMPLETE TEN (10) DAYS
AFTER THE SAME HAS BEEN POSTED.

          Section
10.14.      WAIVER.
EXCEPT AS OTHERWISE PROVIDED FOR IN THIS AGREEMENT AND TO THE EXTENT NOT
PROHIBITED BY APPLICABLE LAW, EACH BORROWER AND EACH GUARANTOR HEREBY WAIVE (i)
PRESENTMENT, DEMAND AND PROTEST AND NOTICE OF PRESENTMENT, PROTEST, DEFAULT,
NON-PAYMENT, MATURITY, RELEASE, COMPROMISE, SETTLEMENT, AND ONE OR 

74 

MORE EXTENSIONS OR RENEWALS OF ANY OR ALL ACCOUNTS, CONTRACT
RIGHTS, DOCUMENTS, INSTRUMENTS, CHATTEL PAPER AND GUARANTIES AT ANY TIME HELD BY
THE ADMINISTRATIVE AGENT AND/OR THE LENDER ON WHICH ANY BORROWER OR ANY
GUARANTOR MAY IN ANY WAY BE LIABLE AND HEREBY RATIFIES AND CONFIRMS WHATEVER THE
ADMINISTRATIVE AGENT AND/OR THE LENDERS MAY DO IN THIS REGARD; (ii) ALL RIGHTS
TO NOTICE AND HEARING PRIOR TO THE ADMINISTRATIVE AGENT'S TAKING POSSESSION OR
CONTROL OF, OR THE ADMINISTRATIVE AGENT'S REPLEVIN, ATTACHMENT OR LEVY ON OR OF
THE COLLATERAL OR ANY BOND OR SECURITY WHICH MIGHT BE REQUIRED BY ANY COURT
PRIOR TO ALLOWING THE LENDER TO EXERCISE ANY OF THE LENDER PARTIES' REMEDIES;
AND (iii) THE BENEFIT OF ALL VALUATION, APPRAISEMENT OR EXEMPTION LAWS. 

          Section
10.15.      ADVICE OF
COUNSEL. EACH BORROWER AND EACH GUARANTOR ACKNOWLEDGES THAT THEY
HAVE BEEN REPRESENTED AND ADVISED BY INDEPENDENT LEGAL COUNSEL WITH RESPECT TO
THE NEGOTIATION, EXECUTION AND ACCEPTANCE OF THIS AGREEMENT AND THE TRANSACTIONS
GOVERNED BY THIS AGREEMENT AND HAVE RELIED UPON THE ADVICE OF ITS INDEPENDENT
LEGAL COUNSEL IN AGREEING TO THE TERMS AND CONDITIONS HEREIN AND IN EXECUTING
AND DELIVERING THIS AGREEMENT, AND THAT THEY HAVE FREELY AND VOLUNTARILY ENTERED
INTO THIS AGREEMENT AS THE PRODUCT OF ARMS' LENGTH NEGOTIATIONS. 

          Section
  10.16.      WAIVER OF RIGHT
  TO TRIAL BY JURY. EACH LENDER PARTY, EACH BORROWER AND EACH GUARANTOR
  HEREBY COVENANT AND AGREE THAT IN ANY SUIT, ACTION OR PROCEEDING IN RESPECT
  OF ANY MATTER ARISING OUT OF THIS AGREEMENT, THE DOCUMENTS EXECUTED IN CONNECTION
  HEREWITH, ANY WRITTEN AGREEMENT BETWEEN THE PARTIES HERETO, WHETHER NOW EXISTING
  OR HEREAFTER ARISING OR IN ANY WAY RELATED TO, CONNECTED WITH OR INCIDENTAL
  TO THE DEALINGS OF THE PARTIES HERETO OR TRANSACTIONS CONTEMPLATED HEREBY OR
  THEREBY WHETHER SOUNDING IN CONTRACT OR TORT OR OTHERWISE, TRIAL SHALL BE TO
  A COURT OF COMPETENT JURISDICTION AND NOT TO A JURY; EACH LENDER PARTY, EACH
  BORROWER AND EACH GUARANTOR HEREBY EXPRESSLY WAIVE ANY RIGHT THEY MAY HAVE TO
  A TRIAL BY JURY. ANY PARTY MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS
  AGREEMENT WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE PARTIES HERETO
  TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.

          Section
10.17.      TIME OF
ESSENCE. Time is of the essence for the performance of the
obligations set forth in this Agreement and the Loan Documents. 

          Section
10.18.      PUBLICATION;
ADVERTISEMENT. 

                    (a)     
No Related Party will, directly or indirectly publish, disclose or otherwise use
in any public disclosure, advertising material, promotional material, press
release or interview, any reference to the name, logo or any trademark of
Administrative Agent, Additional 

75 

Collateral Agent, any Lender or any of their respective
Affiliates or any reference to this Agreement or the financing evidenced hereby,
in any case except (i) as required by Law, subpoena or judicial or similar
order, in which case the applicable Related Party shall give Administrative
Agent prior written notice of such publication or other disclosure or (ii) with
Administrative Agent’s prior written consent, such consent not to be
unreasonably withheld.

                    (b)     
Each Lender and each Related Party hereby authorizes Administrative Agent,
Additional Collateral Agent and Initial Lender to publish the name of the
Lenders, Administrative Agent, Additional Collateral Agent and the Related
Parties, the existence of the financing arrangements referenced under this
Agreement, the primary purpose and/or structure of those arrangements, the
amount of credit extended under each facility, the title and role of each party
to this Agreement, and the total amount of the financing evidenced hereby in any
"tombstone", comparable advertisement or press release which Administrative
Agent or Initial Lender elects to submit for publication. 

          Section
10.19.      Amendment and
Restatement. 

                    (a)      This
Agreement, among other things, (i) amends and restated in its entirety the
Existing Carbiz Loan Agreement and (ii) evidences Carbiz AQ’s agreement to
become a co-Borrower with the other Borrowers under this facility, all on the
terms and conditions contained herein. 

                    (b)      Any
“Indebtedness” as defined in and which is outstanding under the Existing Carbiz
Loan Agreement immediately prior to the effectiveness of this Agreement shall be
deemed refinanced pursuant to the terms of this Agreement and constitute
outstanding Indebtedness hereunder. 

                    (c)      Anything
contained herein to the contrary notwithstanding, this Agreement is not intended
to and shall not serve to effect a novation of the “Indebtedness” defined in and
outstanding under the Existing Carbiz Loan Agreement. Instead, it is the express
intention of the parties hereto to reaffirm the indebtedness, obligations and
liabilities created under the Existing Carbiz Loan Agreement which is evidenced
by the promissory notes provided for therein and secured by the Collateral. Each
Related Party acknowledges and confirms that the liens and security interests
granted pursuant to the Loan Documents secure the indebtedness, liabilities and
obligations of the Related Parties to the Lender Parties under the Existing
Carbiz Loan Agreement, as amended and restated hereby (except that the grants of
Liens under and pursuant to the Loan Documents shall continue unaltered, and
each other Loan Document shall continue in full force and effect in accordance
with its terms unless otherwise amended by the parties thereto, and the parties
hereto hereby ratify and confirm the terms thereof as being in full force and
effect and unaltered by this Agreement), and that the term “Indebtedness” as
used in the Loan Documents (or any other term used therein to describe or refer
to the indebtedness, liabilities and obligations of the Borrowers to the Lender
Parties) includes, without limitation, the indebtedness, liabilities and
obligations of the Borrowers under this Agreement and the Notes to be delivered
hereunder, and under the Existing Carbiz Loan Agreement, as amended and restated
hereby, as the same further may be amended, modified, supplemented and/or
restated from time to time. The Loan Documents and all agreements, instruments
and documents 

76 

executed or delivered in connection with any of the foregoing
shall each be deemed to be amended to the extent necessary to give effect to the
provisions of this Agreement. Each reference to the “Loan Agreement” or “Loan
and Security Agreement” (or any other term used to describe the Existing Carbiz
Loan Agreement) in any Loan Document shall mean and be a reference to this
Agreement (as further amended, restated, supplemented or otherwise modified from
time to time) and each reference to “Borrower” or “Borrowers” in any Loan
Document shall mean and be a reference to all Borrowers hereunder, individually
and collectively. Cross-references in the Loan Documents to particular section
numbers in the Existing Carbiz Loan Agreement shall be deemed to be
cross-references to the corresponding sections, as applicable, of this
Agreement.

ARTICLE 11 
JOINT AND SEVERAL LIABILITY; CROSS
GUARANTY; SUBORDINATION 

          Section
11.1.      JOINT AND SEVERAL
LIABILITY; CROSS GUARANTY. 

                    (a)      Each
Borrower hereby acknowledges and agrees that such Borrower is jointly and
severally liable for all of the Indebtedness, and hereby absolutely and
unconditionally guarantees to the Administrative Agent, for the benefit of the
Lender Parties, the full and prompt payment (whether at stated maturity, by
acceleration or otherwise) and performance of, all Indebtedness and other
obligations and amounts owed or hereafter owing to the Lender Parties under this
Agreement by each other Borrower. Each Borrower agrees that its guaranty
obligation hereunder is a continuing guaranty of payment and performance and not
of collection, that its obligations under this Section shall not be discharged
until payment and performance, in full, of the Indebtedness and other amounts
owed or hereafter owing under this Agreement has occurred and termination of all
commitments to lend under this Agreement, and that its obligations under this
Section shall be absolute and unconditional, irrespective of, and unaffected by:

               (i)      the
genuineness, validity, regularity, enforceability or any future amendment of, or
change in, this Agreement, any other Loan Document or any other agreement,
document or instrument to which any Borrower is or may become a party; 

               (ii)      the
absence of any action to enforce this Agreement (including this Section) or any
other Loan Document or the waiver or consent by Lender Parties with respect to
any of the provisions thereof; 

               (iii)      the
existence, value or condition of, or failure to perfect its security interest in
or lien against, any security for the Indebtedness or any action, or the absence
of any action, by Lender Parties in respect thereof (including the release of
any such security);

               (iv)      the
insolvency of any Borrower or Guarantor; or 

               (v)     
any other action or circumstances that might otherwise constitute a legal or
equitable discharge or defense of a surety or guarantor. 

77 

          Each
Borrower shall be regarded, and shall be in the same position, as principal
debtor with respect to the Indebtedness and other amounts guaranteed hereunder.

                    (b)      Waivers
by Borrowers. Each Borrower expressly waives all rights it may have now or
in the future under any statute, or at common law, or at law or in equity, or
otherwise, to subrogation, to compel Administrative Agent, Additional Collateral
Agent or any Lender to marshal assets or to proceed in respect of the
Indebtedness and other amounts guaranteed hereunder against any other Borrower
or Guarantor, any other party or against any security for the payment and
performance of the Indebtedness and other amounts before proceeding against, or
as a condition to proceeding against, such Borrower. It is agreed among each
Borrower and the Lender Parties that the foregoing waivers are of the essence of
the transaction contemplated by this Agreement and the other Loan Documents and
that, but for the provisions of this Section and such waivers, the Lender
Parties would decline to enter into this Agreement. 

                    (c)      Benefit
of Guaranty. Each Borrower agrees that the provisions of this Section are
for the benefit of the Lender Parties and their successors, transferees,
endorsees and assigns, and nothing herein contained shall impair, as between any
other Borrower and the Lender Parties, the obligations of such other Borrower
under the Loan Documents.

                    (d)     
Election of Remedies. If the Lender Parties may, under applicable law,
proceed to realize their benefits under any of the Loan Documents giving the
Administrative Agent or Additional Collateral Agent, for the benefit of the
Lender Parties, a security interest in or lien upon any Collateral, whether
owned by any Borrower or by any Guarantor, either by judicial foreclosure or by
non-judicial sale or enforcement, the Lender Parties may, at their sole option,
determine which of their remedies or rights they may pursue without affecting
any of the rights and remedies under this Section. If, in the exercise of any of
their rights and remedies, the Lender Parties shall forfeit any of their rights
or remedies, including their right to enter a deficiency judgment against any
Borrower or any other Guarantor, whether because of any applicable laws
pertaining to “election of remedies” or the like, each Borrower hereby consents
to such action by the Lender Parties and waives any claim based upon such
action. Any election of remedies that results in the denial or impairment of the
right of the Lender Parties to seek a deficiency judgment against any Borrower
shall not impair any other Borrower’s obligation to pay the full amount of the
Indebtedness and other amounts owed or hereafter owing under this Agreement. In
the event the Lender Parties shall bid at any foreclosure or trustee’s sale or
at any private sale permitted by law or the Loan Documents, the Lender Parties
may bid all or less than the amount of the Indebtedness and other amounts owed
or hereafter owing under this Agreement and the amount of such bid need not be
paid by the Lender Parties but shall be credited against such Indebtedness and
other amounts. The amount of the successful bid at any such sale, whether the
Lender Parties or any other party is the successful bidder, shall be
conclusively deemed to be the fair market value of the Collateral and the
difference between such bid amount and the remaining balance of the Indebtedness
and other amounts owed or hereafter owing under this Agreement shall be
conclusively deemed to be the amount of the Indebtedness and other amounts
guaranteed under this Section, notwithstanding that any present or future law or
court decision or ruling may have the effect of reducing the amount of any 

78 

deficiency claim to which the Lender Parties might otherwise be
entitled but for such bidding at any such sale. 

                    (e)     
Liability Cumulative. The liability of Borrowers under this Article 11 is
in addition to and shall be cumulative with all liabilities of each Borrower to
the Lender Parties under this Agreement and the other Loan Documents to which
such Borrower is a party or in respect of any Indebtedness or obligation of the
other Borrowers, without any limitation as to amount, unless the instrument or
agreement evidencing or creating such other liability specifically provides to
the contrary. 

                    (f)      Fraudulent
Conveyance. Notwithstanding anything to the contrary set forth in this
Section 11.1, it is the intent of the parties hereto that the liability incurred
by each Borrower in respect of the Indebtedness of the other Borrowers (and any
Lien granted by each Borrower to secure such Indebtedness), not constitute a
fraudulent conveyance under Section 548 of the United States Bankruptcy Code or
a fraudulent conveyance or fraudulent transfer under the provisions of any
applicable law of any state or other governmental unit ("Fraudulent
Conveyance"). Consequently, each Borrower, Administrative Agent,
Additional Collateral Agent and each Lender hereby agree that if a court of
competent jurisdiction determines that the incurrence of liability by any
Borrower in respect of the Indebtedness of any other Borrower (or any Liens
granted by such Borrower to secure such Indebtedness) would, but for the
application of this sentence, constitute a Fraudulent Conveyance, such liability
(and such Liens) shall be valid and enforceable only to the maximum extent that
would not cause the same to constitute a Fraudulent Conveyance, and this
Agreement and the other Loan Documents shall automatically be deemed to have
been amended accordingly. 

          Section
11.2.      SUBORDINATION.

                    (a)      Each
Borrower covenants and agrees that the payment of all indebtedness, principal,
interest (including interest which accrues after the commencement of any case or
proceeding in bankruptcy, or for the reorganization of any Borrower), fees,
charges, expenses, attorneys’ fees and any other sum, obligation or liability
owing by any other Borrower to such Borrower, including any intercompany loans
or trade payables or royalty or licensing fees (collectively, the
“Intercompany Obligations”), is subordinated, to the extent and in the
manner provided in this Section 11.2, to the prior payment in full of all
Indebtedness and other amounts owed or hereafter owing under this Agreement
(herein, the “Senior Obligations”) and that the subordination is for the
benefit of the Lender Parties, and the Lender Parties may enforce such
provisions directly. 

                    (b)      Each
Borrower executing this Agreement hereby (i) authorizes the Lender Parties to
demand specific performance of the terms of this Section 11.2, whether or not
any other Borrower shall have complied with any of the provisions hereof
applicable to it, at any time when such Borrower shall have failed to comply
with any provisions of this Section 11.2 which are applicable to it and (ii)
irrevocably waives any defense based on the adequacy of a remedy at law, which
might be asserted as a bar to such remedy of specific performance. 

79 

                    (c)      Upon
any distribution of assets of any Borrower in any dissolution, winding up,
liquidation or reorganization (whether in bankruptcy, insolvency or receivership
proceedings or upon an assignment for the benefit of creditors or otherwise):

               (i)      The
Lender Parties shall first be entitled to receive payment in full in cash of the
Senior Obligations before any Borrower is entitled to receive any payment on
account of the Intercompany Obligations. 

               (ii)      Any
payment or distribution of assets of any Borrower of any kind or character,
whether in cash, property or securities, to which any other Borrower would be
entitled except for the provisions of this Section 11.2(c), shall be paid by the
liquidating trustee or agent or other person making such payment or distribution
directly to the Administrative Agent, for the benefit of the Lender Parties, to
the extent necessary to make payment in full of all Senior Obligations remaining
unpaid after giving effect to any concurrent payment or distribution or
provisions therefor to the Lender Parties. 

               (iii)      In
the event that notwithstanding the foregoing provisions of this Section 11.2(c),
any payment or distribution of assets of any Borrower of any kind or character,
whether in cash, property or securities, shall be received by any other Borrower
on account of the Intercompany Obligations before all Senior Obligations are
paid in full, such payment or distribution shall be received and held in trust
for and shall be paid over to the Administrative Agent for application to the
payment of the Senior Obligations until all of the Senior Obligations shall have
been paid in full, after giving effect to any concurrent payment or distribution
or provision therefor to the Lender Parties. 

          No
right of the Lender Parties or any other present or future holders of any Senior
Obligations to enforce the subordination provisions herein shall at any time in
any way be prejudiced or impaired by any act or failure to act on the part of
any Borrower or by any act or failure to act, in good faith, by any such holder,
or by any noncompliance by any Borrower with the terms hereof, regardless of any
knowledge thereof which any such holder may have or be otherwise charged with.

- Remainder of Page Intentionally Left Blank; Signature
Pages Follow - 

80 

           IN
WITNESS WHEREOF, the parties have executed this Agreement on the day and year
first set forth above. 

BORROWERS: 

CARBIZ AUTO CREDIT AQ, INC.,

a Florida corporation

By:     
____________________
Name:
____________________
Its:     
____________________

CARBIZ USA INC., 
a Delaware
corporation 

By:     
____________________
Name:
____________________
Its:     
____________________

CARBIZ AUTO CREDIT, INC., 
a
Florida corporation 

By:     
____________________
Name:
____________________
Its:     
____________________

CARBIZ AUTO CREDIT JV1,
LLC, 
a Florida limited liability company 

By:     
____________________
Name:
____________________
Its:     
____________________

SIGNATURE PAGE – AMENDED AND RESTATED LOAN AND SECURITY
AGREEMENT 

GUARANTORS: 

CARBIZ INC., 
an Ontario
corporation 

By:     
____________________
Name:
____________________
Its:     
____________________

SIGNATURE PAGE – AMENDED AND RESTATED LOAN AND SECURITY
AGREEMENT 

ADMINISTRATIVE AGENT: 

SWC SERVICES, LLC, a Delaware
limited liability company, as Administrative Agent 

By:      
____________________
Name: Gregory Bell

Its:      Manager 

ADDITIONAL COLLATERAL AGENT:

AGM, LLC, a Delaware limited
liability company, as Additional Collateral Agent 

By:      
____________________
Name: Gregory Bell

Its:      Manager 

INITIAL LENDER: 

SWC SERVICES LLC, a Delaware
limited liability company, as Initial Lender 

By:      
____________________
Name: Gregory Bell

Its:      Manager 

SIGNATURE PAGE – AMENDED AND RESTATED LOAN AND SECURITY
AGREEMENT 

SCHEDULE A TO 
AMENDED AND RESTATED LOAN AND SECURITY
AGREEMENT 

          This
Schedule A to the Amended and Restated Loan and Security Agreement is executed
in conjunction with that certain Amended and Restated Loan and Security
Agreement dated as of October 1, 2007 (as amended, restated, supplemented or
otherwise modified from time to time, the “Loan Agreement”), by and among
(a) CARBIZ AUTO CREDIT AQ, INC., a Florida corporation, CARBIZ USA INC., a
Delaware corporation, CARBIZ AUTO CREDIT, INC., a Florida corporation, and
CARBIZ AUTO CREDIT JV1, LLC, a Florida limited liability company, as Borrowers,
(b) CARBIZ INC., an Ontario corporation, as a Guarantor, (c) SWC SERVICES LLC, a
Delaware limited liability company, as Initial Lender, (d) the other Lenders
from time to time party hereto, (e) SWC SERVICES, LLC, a Delaware limited
liability company, as Administrative Agent for the Lenders, and (f) AGM, LLC, a
Delaware limited liability company, as Additional Collateral Agent for the
Lenders. Capitalized terms used but not defined herein shall have the meanings
given such terms in the Loan Agreement. 

	 
	ELIGIBLE RECEIVABLES TESTS

SECTION
1.1(a)(i)                AGING
PROCEDURES 

          The
term “Aging Procedures” shall mean, with respect to a Receivable, such
Receivable has been reported to the Lender in compliance with the following
aging procedures: 

	No payment missed or due 	= 	Current 
	1 to 30 days past due 	= 	“30 day Account” 
	31 to 60 days past due 	= 	“60 day Account” 
	61 or more days past due 	= 	“60+ day Account” 

SECTION
1.1(a)(ii)                APPROVED
STATES 

          The
term “Approved State” shall mean Florida, Illinois, Indiana, Iowa, Kentucky,
Nebraska, Ohio and Oklahoma.

SECTION
1.1(a)(iii)             
ELIGIBLE RECEIVABLES 

          The
term "Eligibility Receivables" shall mean those Receivables of the Borrowers
that are acceptable to Administrative Agent, in its reasonable discretion, and,
in each case, that meet, at a minimum, all of the following requirements: 

          (i)      are
originated by a Borrower and arise from the extension of credit, the sale and
delivery of goods, including automobiles, light trucks and other vehicles, or
the rendering of services in the ordinary course of a Borrower’s business; 

1 

EXHIBIT E 

          (ii)     
is genuine, is in all respects what it purports to be and the Consumer Loan
Documents evidencing such Eligible Receivable have only one original counterpart
and include only one original promissory note which constitutes an instrument
under the UCC and no Person other than Administrative Agent, Additional
Collateral Agent or a Custodian is in actual or constructive possession of any
such original Consumer Loan Documents. 

          (iii)      represent
a valid and binding obligation of the related Account Debtor enforceable in
accordance with its terms for the amount outstanding thereof without offset,
counterclaim or defense (whether actual or alleged);

          (iv)     
as to which the Account Debtor thereunder is personally liable pursuant to the
applicable Consumer Loan Documents; 

          (v)      comply,
and as to which the related Consumer Loan Documents comply, in all respects with
all applicable Laws, including, but not limited to, truth in lending and credit
disclosure laws and regulations and all applicable state and federal usury laws;

          (vi)     
as to which (x) the related Consumer Loan Documents are in form and substance
satisfactory to Administrative Agent and have been delivered to the applicable
Custodian pursuant to the terms of Section 3.4 of the Loan Agreement, but
provided, however, that if the Auto Title has not been delivered to the
applicable Custodian within sixty (60) days after execution of the Consumer Loan
Documents, any such Receivable shall not be an Eligible Receivable until such
Auto Title is so delivered and all other requirements hereunder are met, and (y)
all amounts and information appearing on such Consumer Loan Documents or
otherwise furnished to Lenders in connection therewith are true and correct and
undisputed by the Account Debtor thereon or any guarantor thereof; 

          (vii)      as
to which the related Account Debtor and Borrowers are not engaged in any
litigation, including any action regarding nonpayment thereof;

          (viii)      as
to which no set-offs, counterclaims, defenses or disputes as to payments or
liability thereon exist or have been asserted with respect thereto and no
Borrower has made any agreement with any Account Debtor thereunder for any
deduction therefrom, except a discount or allowance allowed by a Borrower in the
ordinary course of its business for prompt payment, all of which discounts or
allowances are reflected in the calculation of the outstanding amount of such
Eligible Receivable; 

          (ix)      none
of the Receivable, the Account Debtor thereon or any guarantor thereof is
subject to any receivership, insolvency or bankruptcy proceeding, nor is any
Account Debtor thereon or any guarantor thereof insolvent or has failed to meet
its debts as they mature; 

          (x)     
no facts, events or occurrences exist that, in any way, impair the validity or
enforcement thereof or tend to reduce the amount payable thereunder from the
amount of the Receivable shown on any schedule, or on all contracts, invoices or
statements delivered to Administrative Agent with respect thereto. 

2 

EXHIBIT E 

          (xi)     
no proceedings or actions are threatened or pending against any Account Debtor
that might result in any material adverse change in the Account Debtor's
financial condition. 

          (xii)      no
instrument of release or waiver has been executed in connection with any
Consumer Loan Document, and no Account Debtor has been released from its
obligations thereunder, in whole or in part, and no action has been taken by a
Borrower to release any collateral under the Consumer Loan Documents (other than
releases of collateral in respect of Receivables that have been paid in full).

          (xiii)      except
as disclosed in writing to Administrative Agent, no Consumer Loan Document has
been amended after the date on which such contract is pledged to the
Administrative Agent, for the benefit of the Lender Parties, hereunder in any
material respect or such that the amount of any monthly payment or the total
number of the monthly payments is increased or such that the amount of any
monthly payment or the total number of monthly payments is decreased. 

          (xiv)     
  the Borrowers have good and sufficient right to pledge, assign and deliver the
  Receivables free and clear from all Liens whatsoever (other than any Liens in
  favor of the Administrative Agent and Additional Collateral Agent);

          (xv)      neither
the Account Debtor thereon nor any guarantor thereof is employed by, related to,
a principal of or affiliated with any Borrower or any Guarantor; 

          (xvi)      to
the Borrowers’ knowledge, no condition exists that materially or adversely
affects the value of the Receivables or jeopardizes any security therefor; 

          (xvii)      if
the Receivables arise from the sale of goods, such goods have been delivered and
accepted by the Account Debtor and are still subject to the lawful possession
and control of the Account Debtor and have not been otherwise returned to or
repossessed by any Borrower; 

          (xviii)     
the original principal amount thereof does not exceed the Maximum Amount of an
Eligible Receivable and the original term thereof does not exceed the Maximum
Term of an Eligible Receivable; 

          (xix)     
has been reported to Administrative Agent and Lenders in compliance with the
Aging Procedures; 

          (xx)     
is not evidenced by a judgment or has not been reduced to judgment; (xxi) is not
an open account or a revolving line of credit; (xxii) the Account Debtor
thereunder is a legal resident of the United States; (xiii) payments under the
Receivable are to be made in United States dollars; 

          (xxiv)     
the number of days between contractual payment dates of a Receivable does not
exceed thirty (30) days based on a three hundred sixty (360) day year; 

3 

EXHIBIT E 

          (xxv)      complies
with all Underwriting Guidelines; 

          (xxvi)      has
been originated in an Approved State; 

          (xxvii)      payment
thereof is secured by a first priority Lien in the related Account Debtor’s
automobile or other vehicle financed by such Receivable, free and clear of any
Liens of other Persons (including without limitation any mechanic’s lien or
claim for work, labor or material affecting such vehicle but excluding any Liens
in favor of the Administrative Agent or Additional Collateral Agent), for which
the related Auto Title has been issued in a Borrower’s name and which automobile
or other vehicle is equipped with a SID/GPS Device (provided that such vehicle
need not be equipped with a SID/GPS Device to the extent such Receivable is a
Receivable acquired by Carbiz AQ pursuant to the Asset Purchase Agreement and in
existence on the Closing Date); 

          (xxviii)     
is not a previously sold Receivable repurchased by a Borrower on recourse; 

          (xxix)     
is thirty (30) days or less contractually past due under the due date set forth
in the underlying Consumer Loan Documents (provided Receivables that otherwise
would constitute Eligible Receivables because they satisfy all of the other
eligibility criteria set forth herein may continue to be treated as Eligible
Receivables if they are more than thirty (30) days contractually past due so
long as such Receivables are no more than sixty (60) days contractually past due
and the amount of such Receivables that are deemed eligible due to this
parenthetical do not exceed at any time six percent (6%) of the aggregate amount
of Eligible Receivables) and has not been extended (excluding any extensions in
effect as of the Closing Date and, with respect to a particular Consumer Loan
Document, extensions that are not in excess of fourteen (14) consecutive days so
long as such extensions are not granted more than once per month) more than two
(2) times per year after three (3) months of consecutive payments; 

          (xxx)      carries
a minimum interest rate of 15.99% (provided such minimum interest rate shall be
14% in Florida and, until such time as a Borrower is properly licensed in
Nebraska so that it is permitted to charge a rate higher than 15.95%, 15.95% in
Nebraska); 

          (xxxi)      at
the time of origination of the Receivable, has maximum mileage on the underlying
vehicle securing the Consumer Loan Documents that is not greater than 170,000
miles; and 

          (xxxii)     
the automobiles and light trucks that are subject of the Receivable shall not
exceed fifteen (15) model years in age as of the date of the Receivable. 

SECTION
1.1(a)(iv)                MAXIMUM
AMOUNT OF AN ELIGIBLE RECEIVABLE 

The maximum principal balance of an
Eligible Receivable (the “Maximum Amount of an Eligible
Receivable”), for any date of determination, shall not exceed Six Thousand
Five Hundred and No/100 Dollars ($6,500.00), as of such determination date.

SECTION
1.1(a)(v)                MAXIMUM
TERM OF AN ELIGIBLE RECEIVABLE 

4 

EXHIBIT E 

The maximum term of an Eligible
Receivable (the “Maximum Term of an Eligible Receivable”), for any
date of determination, shall not have more than ninety (90) weeks remaining
until the due date of such Eligible Receivable, as of such determination
date.

	 
	SECTION
      1.1(b)               
      ELIGIBLE INVENTORY 

The term “Eligible Inventory” shall
mean Automobile Inventory of the Borrowers that is acceptable to Administrative
Agent, in its reasonable discretion, and, in each case, that meet, at a minimum,
all of the following requirements: 

          (i)     
such Automobile Inventory is the full control and possession of a Borrower and
located at a Borrower’s place of business identified on Schedule 5.1(n) hereto
with respect to which Administrative Agent has received a collateral access
agreement from the applicable lessors and/or mortgagees, in form and substance
reasonably acceptable to Administrative Agent; 

          (ii)      such
Automobile Inventory is subject to a first priority perfected Lien in favor of
Administrative Agent or Additional Collateral Agent; 

          (iii)      such
Automobile Inventory is owned by a Borrower free and clear of the Lien of any
Person other than the Lien of Administrative Agent and Additional Collateral
Agent; 

          (iv)      such
Automobile Inventory has been owned by Borrowers for a period of ninety (90)
days or less; 

          (v)      such
Automobile Inventory has not been damaged, the repair cost of which exceeds ten
percent (10%) of the average Black Book wholesale value of such Automobile
Inventory; 

          (vi)      such
Automobile Inventory is not subject to litigation (or threatened litigation) by
or involving Borrower; 

          (vii)     
such Automobile Inventory is a type of vehicle that has been manufactured in
accordance with all applicable Laws and of a type that may be registered for
road use under the laws of the Approved State in which such Automobile Inventory
is located; 

          (viii)      such
Automobile Inventory is not Inventory that Administrative Agent has determined,
in the exercise of its reasonable determination, or in the determination of
Borrower’s management, is excess, obsolete, unsaleable or unfit for sale; 

          (ix)     
such Automobile Inventory is not otherwise unacceptable to Administrative Agent
in its reasonable credit judgment due to age, quality, type, category and/or
quantity;

5 

EXHIBIT E 

          (x)      such
Automobile Inventory shall have been purchased at average Black Book wholesale
value plus or minus mileage credits or deductions; 

          (xi)      such
Automobile Inventory shall have a maximum mileage of 170,000 at the time of
purchase by a Borrower and shall not exceed fifteen (15) model years in age at
the time of purchase by a Borrower; and 

          (xii)      if
replacing Title Guaranties, Title Applications or Title Receipts, the Auto Title
with respect to such Automobile Inventory shall have been delivered to the
applicable Custodian within thirty (30) calendar days of the purchase of such
Automobile Inventory by a Borrower. 

	 
	SECTION
      2.1(a)(ii)                AVAILABILITY
      ON ELIGIBLE RECEIVABLES 

The “Availability on Eligible
Receivables” shall be an amount equal to the lesser of (i) the Amount of
Receivables Credit Line in effect from time to time, (ii) sixty percent (60%)
(the “Receivables Advance Rate”) of the outstanding principal balance of
all Eligible Receivables, (iii) one hundred percent (100%) of the Borrowers’
cost basis (defined as invoice cost, make ready costs and commissions of sale)
with respect to the automobiles sold with respect to such Eligible Receivables
and (iv) 100% of the Black Book average wholesale of the vehicles
collateralizing such Receivables. 

If the Loss to Liquidation Ratio for
the most recently ended three month period exceeds twenty percent (20%), the
Receivables Advance Rate shall be reduced by the corresponding percentage of
such excess. Thereafter, should the Loss to Liquidation Ratio for any subsequent
three month period improve such that it is twenty percent (20%) or less, the
Administrative Agent shall increase Receivables Advance Rate by a corresponding
percentage to a percentage not to exceed sixty percent (60%).

	 
	SECTION
      2.2(a)(ii)                AVAILABILITY
      ON ELIGIBLE INVENTORY 

The “Availability on Eligible
Inventory” shall be the lesser of (A) the Amount of Inventory Credit Line
and (B) the sum of (i) for vehicles owned by Borrowers 0 – 60 days, an amount
equal to the lesser of (x) one hundred percent (100%) of the Borrowers’
Acquisition Cost and (y) one hundred percent (100%) of the Black Book wholesale
value of the vehicle; plus (ii) for vehicles owned 61 to 90 days, the lesser of
(x) seventy-five percent (75%) of the Borrowers’ Acquisition Cost and (y) 100%
of wholesale value of vehicle; plus (iii) for vehicles owned by the Borrowers 91
days or more, 0% of the Borrowers’ Acquisition Cost (such applicable percentage,
the “Inventory Advance Rate”). 

6 

EXHIBIT E 

“Borrowers’ Acquisition Cost”
shall mean (i) the actual purchase price paid by a Borrower in respect of
Eligible Inventory (including trade-in credit given by a Borrower to the seller
of any vehicle not in excess of average Black Book wholesale value for such
vehicle) plus (ii) up to $400 in “make ready” costs per vehicle constituting
Eligible Inventory plus (iii) up to $200 for installation of a GPS/SIDS Device
per vehicle constituting Eligible Inventory.

	 
	SECTION
      2.8               
      LIQUIDATED DAMAGES 

The term “Liquidated Damages”
shall mean: 

          (a)     
for the period from the date hereof through and including September 30, 2008, an
amount equal to (i) 4.0% of the then applicable Amount of Receivables Credit
Line plus (ii) 4.0% of the then applicable Amount of Inventory Credit
Line; 

          (b)      for
the period from October 1, 2008 through and including September 30, 2009, an
amount equal to (i) 3.0% of the then applicable Amount of Receivables Credit
Line plus (ii) 3.0% of the then applicable Amount of Inventory Credit
Line;

          (c)     
for the period from October 1, 2009 through and including September 30, 2010, an
amount equal to (i) 2.0% of the then applicable Amount of Receivables Credit
Line plus (ii) 2.0% of the then applicable Amount of Inventory Credit
Line; and 

          (d)      for
the period from October 1, 2010 through and including September 30, 2011, an
amount equal to (i) 1.0% of the then applicable Amount of Receivables Credit
Line plus (ii) 1.0% of the then applicable Amount of Inventory Credit
Line. 

	 
	SECTION
      2.12                FEES
    

The commitment fee due and payable by
Borrowers to Initial Lender on the Closing Date shall be $150,000.00.

SECTION
3.11               
USE OF PROCEEDS 

          Proceeds
  of the Term Loan funded on the Closing Date shall first be used by Carbiz AQ
  to finance the acquisition of the Purchased Assets (as defined in the Asset
  Purchase Agreement) pursuant to the terms of the Asset Purchase Agreement and
  pay related transaction fees, costs and expenses in respect thereof, and the
  remainder of any proceeds of the Term Loan funded on 

7 

EXHIBIT E 

the Closing Date, if any, shall be used by the Borrowers for
working capital purposes in the ordinary course of business. 

8 

EXHIBIT E 

EXHIBIT F-1 

RECEIVABLES NOTE 

	$________________________	_________, 20__ 
	 	Chicago, Illinois 

          FOR
VALUE RECEIVED, the undersigned, CARBIZ USA INC., a Delaware corporation
(“Carbiz USA”), CARBIZ AUTO CREDIT, INC., a Florida corporation
(“Carbiz Auto”), CARBIZ AUTO CREDIT JV1, LLC, a Florida limited
liability company (“Carbiz LLC”), and CARBIZ AUTO CREDIT AQ, INC.,
a Florida corporation (“Carbiz AQ”; Carbiz USA, Carbiz Auto, Carbiz LLC
and Carbiz AQ are sometimes referred to herein individually as a
“Borrower” and, collectively, as the “Borrowers”), hereby jointly
and severally promise to pay to the order of SWC SERVICES LLC, a Delaware
limited liability company (the “Lender”), the principal sum of
_____________ and No/100 Dollars ($_________ ), or, if greater or less, the
aggregate unpaid principal amount of the Receivables Loan Advances made by
Lender to Borrowers pursuant to the terms of the Loan and Security Agreement (as
hereinafter defined), together with interest on the unpaid principal balance
thereof as set forth in the Loan and Security Agreement, both principal and
interest payable as herein provided in lawful money of the United States of
America at the offices of Administrative Agent under the Loan and Security
Agreement, or at such other place as from time to time may be designated by the
holder of this Receivables Note (this “Note”). 

          This
Note (a) is issued and delivered under that certain Amended and Restated Loan
and Security Agreement dated as of October __, 2007 (as amended, restated,
supplemented or otherwise modified from time to time, the “Loan and Security
Agreement”) among the Borrowers, certain guarantors party thereto, the
Initial Lender, certain other Lenders from time to time party thereto, SWC
Services, LLC, a Delaware limited liability company, as administrative agent (in
such capacity, “Administrative Agent”) for the Lenders, and the
Additional Collateral Agent party thereto, and is a “Note” as defined therein,
(b) is subject to the terms and provisions of the Loan and Security Agreement,
which contains provisions for payments and prepayments hereunder and
acceleration of the maturity hereof upon the happening of certain stated events,
and (c) is secured by and entitled to the benefits of the Loan and Security
Agreement and certain other Loan Documents (as identified and defined in the
Loan and Security Agreement). Payments on this Note shall be made and applied as
provided in the Loan and Security Agreement. Reference is hereby made to the
Loan and Security Agreement for a description of certain rights, limitations of
rights, obligations and duties of the parties hereto and for the meanings
assigned to capitalized terms used and not defined herein and to the Loan
Documents for a description of the nature and extent of the security thereby
provided and the rights of the parties thereto. 

          The
principal amount of this Note, together with all interest accrued hereon, shall
be due and payable as set forth in the Loan and Security Agreement and is due
and payable in full on the Maturity Date applicable to the Revolving Loan. 

1 

EXHIBIT F-1 

          Notwithstanding
the foregoing paragraph and all other provisions of this Note, in no event shall
the interest payable hereon, whether before or after maturity, exceed the
maximum interest which, under applicable Law, may be contracted for, charged, or
received on this Note, and this Note is expressly made subject to the provisions
of the Loan and Security Agreement which more fully set out the limitations on
how interest accrues hereon. 

          Without
limiting the terms of the Loan and Security Agreement, if this Note is placed in
the hands of an attorney for collection after default, or if all or any part of
the indebtedness represented hereby is proved, established or collected in any
court or in any bankruptcy, receivership, debtor relief, probate or other court
proceedings, Borrowers and all endorsers, sureties and guarantors of this Note
jointly and severally agree to pay attorneys’ fees and collection costs to the
holder hereof in addition to the principal and interest payable hereunder. 

          Borrowers
and all endorsers, sureties and guarantors of this Note hereby severally waive
demand, presentment, notice of demand and of dishonor and nonpayment of this
Note, protest, notice of protest, notice of intention to accelerate the maturity
of this Note, declaration or notice of acceleration of the maturity of this
Note, diligence in collecting, the bringing of any suit against any party and
any notice of or defense on account of any extensions, renewals, partial
payments or changes in any manner of or in this Note or in any of its terms,
provisions and covenants, or any releases or substitutions of any security, or
any delay, indulgence or other act of any trustee or any holder hereof, whether
before or after maturity. 

- Remainder of Page Intentionally Left Blank; Signature
Page Follows - 

2 

EXHIBIT F-1 

          This
Note and the rights and duties of the parties hereto shall be governed by the
Laws of the State of Illinois (without regard to principles of conflicts of
law), except to the extent the same are governed by applicable federal Law. 

BORROWERS: 

CARBIZ AUTO CREDIT AQ, INC.,

a Florida corporation

By:       
____________________
Name:  
____________________
Its:       
____________________

CARBIZ USA INC., 
a Delaware
corporation 

By:       
____________________
Name:  
____________________
Its:       
____________________

CARBIZ AUTO CREDIT, INC., 
a
Florida corporation 

By:       
____________________
Name:  
____________________
Its:       
____________________

CARBIZ AUTO CREDIT JV1, LLC,

a Florida limited liability company 

By:       
____________________
Name:  
____________________
Its:       
____________________

3 

EXHIBIT F-1 

EXHIBIT F-2 

INVENTORY NOTE 

	$________________________	________________, 20__ 
	 	Chicago, Illinois 

          FOR
VALUE RECEIVED, the undersigned, CARBIZ USA INC., a Delaware corporation
(“Carbiz USA”), CARBIZ AUTO CREDIT, INC., a Florida corporation
(“Carbiz Auto”), CARBIZ AUTO CREDIT JV1, LLC, a Florida limited
liability company (“Carbiz LLC”), and CARBIZ AUTO CREDIT AQ, INC.,
a Florida corporation (“Carbiz AQ”; Carbiz USA, Carbiz Auto, Carbiz LLC
and Carbiz AQ are sometimes referred to herein individually as a
“Borrower” and, collectively, as the “Borrowers”), hereby jointly
and severally promise to pay to the order of SWC SERVICES LLC, a Delaware
limited liability company (the “Lender”), the principal sum of
_____________ and No/100 Dollars ($_________), or, if greater or less, the
aggregate unpaid principal amount of the Inventory Loan Advances made by Lender
to Borrowers pursuant to the terms of the Loan and Security Agreement (as
hereinafter defined), together with interest on the unpaid principal balance
thereof as set forth in the Loan and Security Agreement, both principal and
interest payable as herein provided in lawful money of the United States of
America at the offices of Administrative Agent under the Loan and Security
Agreement, or at such other place as from time to time may be designated by the
holder of this Inventory Note (this “Note”). 

          This
Note (a) is issued and delivered under that certain Amended and Restated Loan
and Security Agreement dated as of October __, 2007 (as amended, restated,
supplemented or otherwise modified from time to time, the “Loan and Security
Agreement”) among the Borrowers, certain guarantors party thereto, the
Initial Lender, certain other Lenders from time to time party thereto, SWC
Services, LLC, a Delaware limited liability company, as administrative agent (in
such capacity, “Administrative Agent”) for the Lenders, and the
Additional Collateral Agent party thereto, and is a “Note” as defined therein,
(b) is subject to the terms and provisions of the Loan and Security Agreement,
which contains provisions for payments and prepayments hereunder and
acceleration of the maturity hereof upon the happening of certain stated events,
and (c) is secured by and entitled to the benefits of the Loan and Security
Agreement and certain other Loan Documents (as identified and defined in the
Loan and Security Agreement). Payments on this Note shall be made and applied as
provided in the Loan and Security Agreement. Reference is hereby made to the
Loan and Security Agreement for a description of certain rights, limitations of
rights, obligations and duties of the parties hereto and for the meanings
assigned to capitalized terms used and not defined herein and to the Loan
Documents for a description of the nature and extent of the security thereby
provided and the rights of the parties thereto. 

          The
principal amount of this Note, together with all interest accrued hereon, shall
be due and payable as set forth in the Loan and Security Agreement and is due
and payable in full on the Maturity Date applicable to the Inventory Loan. 

1 

EXHIBIT F-2 

          Notwithstanding
the foregoing paragraph and all other provisions of this Note, in no event shall
the interest payable hereon, whether before or after maturity, exceed the
maximum interest which, under applicable Law, may be contracted for, charged, or
received on this Note, and this Note is expressly made subject to the provisions
of the Loan and Security Agreement which more fully set out the limitations on
how interest accrues hereon. 

          Without
limiting the terms of the Loan and Security Agreement, if this Note is placed in
the hands of an attorney for collection after default, or if all or any part of
the indebtedness represented hereby is proved, established or collected in any
court or in any bankruptcy, receivership, debtor relief, probate or other court
proceedings, Borrowers and all endorsers, sureties and guarantors of this Note
jointly and severally agree to pay attorneys’ fees and collection costs to the
holder hereof in addition to the principal and interest payable hereunder. 

          Borrowers
and all endorsers, sureties and guarantors of this Note hereby severally waive
demand, presentment, notice of demand and of dishonor and nonpayment of this
Note, protest, notice of protest, notice of intention to accelerate the maturity
of this Note, declaration or notice of acceleration of the maturity of this
Note, diligence in collecting, the bringing of any suit against any party and
any notice of or defense on account of any extensions, renewals, partial
payments or changes in any manner of or in this Note or in any of its terms,
provisions and covenants, or any releases or substitutions of any security, or
any delay, indulgence or other act of any trustee or any holder hereof, whether
before or after maturity. 

- Remainder of Page Intentionally Left Blank; Signature
Page Follows - 

2 

EXHIBIT F-2 

          This
Note and the rights and duties of the parties hereto shall be governed by the
Laws of the State of Illinois (without regard to principles of conflicts of
law), except to the extent the same are governed by applicable federal Law. 

BORROWERS: 

CARBIZ AUTO CREDIT AQ, INC.,

a Florida corporation

By:       
____________________
Name:  
____________________
Its:       
____________________

CARBIZ USA INC., 
a Delaware
corporation 

By:       
____________________
Name:  
____________________
Its:       
____________________

CARBIZ AUTO CREDIT, INC., 
a
Florida corporation 

By:       
____________________
Name:  
____________________
Its:       
____________________

CARBIZ AUTO CREDIT JV1, LLC,

a Florida limited liability company 

By:       
____________________
Name:  
____________________
Its:       
____________________

3 

EXHIBIT F-2 

EXHIBIT F-3 

TERM NOTE 

	$____________ 	_________________ __, 2007 
	  	Chicago, Illinois 

          FOR
VALUE RECEIVED, the undersigned, CARBIZ USA INC., a Delaware corporation
(“Carbiz USA”), CARBIZ AUTO CREDIT, INC., a Florida corporation
(“Carbiz Auto”), CARBIZ AUTO CREDIT JV1, LLC, a Florida limited
liability company (“Carbiz LLC”), and CARBIZ AUTO CREDIT AQ, INC.,
a Florida corporation (“Carbiz AQ”; Carbiz USA, Carbiz Auto, Carbiz LLC
and Carbiz AQ are sometimes referred to herein individually as a
“Borrower” and, collectively, as the “Borrowers”), hereby jointly
and severally promise to pay to the order of SWC SERVICES LLC, a Delaware
limited liability company (the “Lender”), the principal sum of
__________________ and No/100 Dollars ($______________), or, if greater or less,
the aggregate unpaid principal amount of the Term Loan made by Lender to
Borrowers pursuant to the terms of the Loan and Security Agreement (as
hereinafter defined), together with interest on the unpaid principal balance
thereof as set forth in the Loan and Security Agreement, both principal and
interest payable as herein provided in lawful money of the United States of
America at the offices of Administrative Agent under the Loan and Security
Agreement, or at such other place as from time to time may be designated by the
holder of this Term Note (this “Note”). 

          This
Note (a) is issued and delivered under that certain Amended and Restated Loan
and Security Agreement dated as of October __, 2007 (as amended, restated,
supplemented or otherwise modified from time to time, the “Loan and Security
Agreement”) among the Borrowers, certain guarantors party thereto, the
Initial Lender, certain other Lenders from time to time party thereto, SWC
Services, LLC, a Delaware limited liability company, as administrative agent (in
such capacity, “Administrative Agent”) for the Lenders, and the
Additional Collateral Agent party thereto, and is a “Note” as defined therein,
(b) is subject to the terms and provisions of the Loan and Security Agreement,
which contains provisions for payments and prepayments hereunder and
acceleration of the maturity hereof upon the happening of certain stated events,
and (c) is secured by and entitled to the benefits of the Loan and Security
Agreement and certain other Loan Documents (as identified and defined in the
Loan and Security Agreement). Payments on this Note shall be made and applied as
provided in the Loan and Security Agreement. Reference is hereby made to the
Loan and Security Agreement for a description of certain rights, limitations of
rights, obligations and duties of the parties hereto and for the meanings
assigned to capitalized terms used and not defined herein and to the Loan
Documents for a description of the nature and extent of the security thereby
provided and the rights of the parties thereto. 

          The
principal amount of this Note, together with all interest accrued hereon, shall
be due and payable as set forth in the Loan and Security Agreement and is due
and payable in full on the Maturity Date applicable to the Term Loan. 

1 

EXHIBIT H 

      
   Notwithstanding the foregoing paragraph and all other
provisions of this Note, in no event shall the interest payable hereon, whether
before or after maturity, exceed the maximum interest which, under applicable
Law, may be contracted for, charged, or received on this Note, and this Note is
expressly made subject to the provisions of the Loan and Security Agreement
which more fully set out the limitations on how interest accrues hereon. 

          Without
limiting the terms of the Loan and Security Agreement, if this Note is placed in
the hands of an attorney for collection after default, or if all or any part of
the indebtedness represented hereby is proved, established or collected in any
court or in any bankruptcy, receivership, debtor relief, probate or other court
proceedings, Borrowers and all endorsers, sureties and guarantors of this Note
jointly and severally agree to pay attorneys’ fees and collection costs to the
holder hereof in addition to the principal and interest payable hereunder. 

    
     Borrowers and all endorsers, sureties and
guarantors of this Note hereby severally waive demand, presentment, notice of
demand and of dishonor and nonpayment of this Note, protest, notice of protest,
notice of intention to accelerate the maturity of this Note, declaration or
notice of acceleration of the maturity of this Note, diligence in collecting,
the bringing of any suit against any party and any notice of or defense on
account of any extensions, renewals, partial payments or changes in any manner
of or in this Note or in any of its terms, provisions and covenants, or any
releases or substitutions of any security, or any delay, indulgence or other act
of any trustee or any holder hereof, whether before or after maturity. 

- Remainder of Page Intentionally Left Blank; Signature
Page Follows - 

2 

EXHIBIT H 

      
    This Note and the rights and duties of the parties
hereto shall be governed by the Laws of the State of Illinois (without regard to
principles of conflicts of law), except to the extent the same are governed by
applicable federal Law. 

BORROWERS: 

CARBIZ AUTO CREDIT AQ, INC.,

a Florida corporation

By:       
____________________
Name:  
____________________
Its:       
____________________

CARBIZ USA INC., 
a Delaware
corporation 

By:       
____________________
Name:  
____________________
Its:       
____________________

CARBIZ AUTO CREDIT, INC., 
a
Florida corporation 

By:       
____________________
Name:  
____________________
Its:       
____________________

CARBIZ AUTO CREDIT JV1, LLC,

a Florida limited liability company 

By:       
____________________
Name:  
____________________
Its:       
____________________

3 

EXHIBIT H

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