Form of Non-Qualified Stock Option Agreement for Non-Employee Directors

Grant of Options. In consideration of the services rendered to Carbiz Inc. (the “Company”) and/or its Subsidiaries by the Participant as a member of the Board of Directors of the Company or a Subsidiary, the Company hereby grants to the Participant an Option to purchase all or any part of a total of {NUMBER} Shares of the Company at a price of ${PRICE} per Share (“Option Price”). This Option is granted as of {DATE 1} (“Award Date”). This Option is granted pursuant to the Plan and is subject to the terms thereof.

Term.

Normal Term. The term of this Option is {TERM YEARS} years, until {DATE 2}; provided, however, that this Option may be terminated earlier as provided below.

Early Termination. This Option will terminate on the date the Participant’s Board Service (as defined in Paragraph 7) ceases; provided, however, that, to the extent this Option is exercisable or becomes exercisable upon cessation of the Participant’s Board Service, this Option will remain exercisable until {DATE 2}.

Exercise.

Exercisability. This Option is first exercisable, in whole or in part, on and after the applicable time provided below:

Subject to earlier exercisability as provided in (ii) or (iii) below, this Option shall become exercisable as follows: (1) 20% of the total number of Shares awarded under this Agreement shall be first exercisable on the first anniversary of the Award Date, (2) the second 20% of the total number of Shares awarded under this Agreement shall be first exercisable on the second anniversary of the Award Date, (3) the third 20% of the total number of Shares awarded under this Agreement shall be first exercisable on the third anniversary of the Award Date, (4) the fourth 20% of the total number of Shares awarded under this Agreement shall be first exercisable on the fourth anniversary of the Award Date, and (5) the fifth 20% of the total number of Shares awarded under this Agreement shall be first exercisable on the fifth anniversary of the Award Date.

If a Change in Control occurs after the Award Date, before the expiration date of this Option and during the continuation of the Participant’s Board Service (as defined in Paragraph 7), this Option may first be exercised (to the extent not already exercisable), in whole or in part, after the date such Change in Control occurs.

If the Participant’s Board Service (as defined in Paragraph 7) ceases as a result of the Participant’s retirement from Board Service in accordance with any applicable Company policy on mandatory or permissive, early or normal retirement as in effect at the date of such retirement,

By Whom Exercisable. During the Participant’s lifetime, this Option may be exercised only by the Participant or, where this Option has been transferred to a family member, family trust, or family partnership pursuant to Paragraph 5, the family member, the trustee of the family trust, or the general partner of the family partnership. To the extent this Option has not been transferred to a family member, family trust, or family partnership pursuant to Paragraph 5, if the Participant dies prior to the expiration date of this Option without having exercised this Option as to all of the Shares covered thereby for which rights have not been transferred, this Option may be exercised, to the extent of the Shares with respect to which this Option could have been exercised by the Participant immediately prior to his or her death, by the estate or a person who acquired the right to exercise this Option (or untransferred portion thereof) by bequest or inheritance from, or by reason of the death of, the Participant. To the extent this Option has been transferred to a family member pursuant to Paragraph 5 and the transferee family member dies prior to the expiration date of this Option without having exercised this Option as to all of the Shares covered thereby, the transferred portion of this Option may be exercised, to the extent of the Shares with respect to which this Option could have been exercised by the family member if such family member were still living, by the estate or a person who acquired the right to exercise this Option by bequest or inheritance from, or by reason of the death of, the transferee family member. To the extent this Option has been transferred to a family trust or family partnership pursuant to Paragraph 5 and the family trust or family partnership has terminated or otherwise distributed this Option to its beneficiaries or partners prior to the expiration date of this Option without having exercised this Option as to all of the Shares covered thereby, the transferred portion of this Option may be exercised, to the extent of the Shares with respect to which this Option could have been exercised by the trustee of the family trust or general partner of the family partnership if the family trust or family partnership were still in existence, by the person who acquired the right to exercise this Option by distribution from the family trust or partnership.

Exercise. This Option shall be exercised by delivery on any business day to the Company of a Notice of Exercise in the form attached to this Agreement accompanied by payment of the Option Price as provided in Paragraph 4 and payment in full, to the extent required by Paragraph 12, of the amount of any tax the Company is required to withhold as a result of such exercise.

Payment of Option Price. The Option Price will be payable in full upon exercise of this Option to purchase Shares, and such Option Price must be paid in cash or certified check or wire transfer or by a combination of the foregoing.

Transferability. This Option may not be transferred by the Participant except by will or by the laws of descent and distribution or by a transfer, in whole or in part, without consideration by gift to a member or members of the Participant’s “immediate family,” as such term is defined under Exchange Act Rule 16a-l(e), or to a trust for the benefit solely of a member or members of the Participant’s immediate family, or to a partnership or other entity whose only owners are members of the Participant’s family. For purposes hereof, “family member” means any child, stepchild, grandchild, parent, stepparent, grandparent, spouse, former spouse, sibling, niece, nephew, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law, or sister-in-law, including adoptive relationships, any person sharing the Participant’s household (other than a tenant or employee), or a trust in which these persons have more than fifty percent of the beneficial interest. No transfer of this Option in whole or in part by gift to a family member shall be effective until the Company receives written notice of such transfer in a form acceptable to it. The attached Transfer by Gift to Family Member, Trust, or Partnership form may be used to effect such a transfer by gift, and the delivery of a completed copy of such form to the Company shall constitute notice to the Company.

Forfeiture. This Option shall be forfeited if it is not exercisable at the time of the Participant’s cessation of Board Service (as defined in Paragraph 7) if such cessation occurs for any reason other than Participant’s retirement

from Board Service in accordance with any applicable Company policy on mandatory or permissive retirement, death, or total and permanent disability (within the meaning of Section 22(e)(3) of the Code).

Board Service.

For purposes hereof, “Board Service” means membership on the Board of Directors of the Company or a Subsidiary and includes subsequent service as an Employee, if any, as provided in this paragraph. Notwithstanding any contrary provision or implication herein, in determining cessation of Board Service for purposes hereof, transfers between the Boards of Directors of the Company and/or any Subsidiary shall be disregarded and shall not be considered a cessation of Board Service, and changes in status between that of an Employee and a Non-Employee Director shall be disregarded and shall not be considered a cessation of Board Service.

Nothing under the Plan or in this Agreement shall confer upon the Participant any right to continue Board Service or in any way affect any right of the Company to terminate the Participant’s Board Service without prior notice at any time for any or no reason.

Compliance with Securities Laws. The Company covenants that it will file and attempt to maintain an effective registration statement with the United States Securities and Exchange Commission covering the Shares of the Company, which are the subject of and may be issued pursuant to this Agreement, at all times during which this Option is exercisable and there is no applicable exemption from registration of such Shares; provided, however, that this Option shall not be exercisable for Shares at any time if its exercise would cause the Company to be in violation of any applicable provisions of the United States federal or state securities law.

Administration of Plan. The Plan is administered by a Committee appointed by the Board of Directors. The Committee has the authority to construe and interpret the Plan, to make rules of general application relating to the Plan, to amend outstanding options, and to require of any person exercising this Option, at the time of such exercise, the execution of any paper or the making of any representation or the giving of any commitment that the Committee shall, in its discretion, deem necessary or advisable by reason of the securities laws of the United States or any state, or the execution of any paper or the payment of any sum of money in respect of taxes or the undertaking to pay or have paid any such sum that the Committee shall, in its discretion, deem necessary by reason of the Code or any rule or regulation thereunder or by reason of the tax laws of any state. All such Committee determinations shall be final, conclusive, and binding upon the Company and the Participant.

Capital Adjustments. The number of Shares covered by this Option, and the Option Price thereof, will be subject to an appropriate and equitable adjustment, as determined by the Committee, to reflect any share dividend, share split, or share combination, and will be subject to such adjustment as the Committee may deem appropriate to reflect any exchange of shares, recapitalization, merger, consolidation, separation, reorganization, liquidation, or the like, of or by the Company.

Rights as a Shareholder. The Participant, or a transferee of this Option, shall have no rights as a shareholder with respect to any Shares subject to this Option until the date of the exercise of this Option for such Shares. No adjustment shall be made for dividends (ordinary or extraordinary, whether in cash, securities, or other property) or distributions or other rights for which the record date is prior to the date of such exercise, except as provided in Paragraph 10 hereof.

Withholding Taxes. The Company, or one of its Subsidiaries, shall have the right to withhold any federal, state, or local taxes or any other applicable taxes required to be withheld by law with respect to the exercise of this Option. The Participant will be required to pay the Company, as appropriate, the amount of any such taxes which the Company, or one of its Subsidiaries, is required to withhold. In lieu thereof, the Company shall have the right to withhold from any other cash amounts due to or to become due from the Company to the Participant an amount equal to such taxes required to be withheld by the Company to reimburse the Company for any such taxes; or to retain and withhold a number of Shares having a Fair Market Value on the date of exercise not less than the

amount of such taxes, and cancel any such Shares so withheld, in order to reimburse the Company for any such taxes.

Governing Law. This Agreement shall be construed in accordance with and governed by the laws of the State of Florida.

Successors. This Agreement shall be binding upon and inure to the benefit of the successors, assigns, heirs, and legal representatives of the respective parties.

Prohibition Against Pledge, Attachment, etc. Except as otherwise provided herein, this Option, and the rights and privileges conferred hereby, shall not be transferred, assigned, pledged, or hypothecated in any way and shall not be subject to execution, attachment, or similar process.

Not Intended to be an Incentive Stock Option. This Option is not intended to qualify as an incentive stock option within the meaning of Section 422(b) of the Code, and the provisions hereof shall be construed consistent with that intent.

Capitalized Terms. Capitalized terms in this Agreement have the meaning assigned to them in the Plan, unless this Agreement provides, or the context requires, otherwise.