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FINANCING AGREEMENT

FOR VALUE RECEIVED, World Moto, Inc, (“FARE”), a Nevada corporation (the
“Borrower”) with at least 378,000,000 common shares issued and outstanding,
promises to pay to Macallan Partners, LLC or its Assignees (the “Lender”) the
Principal Sum along with the Interest and any other fees according to the terms
herein. This Agreement will become effective only upon execution by both parties
and delivery of the first payment of consideration by the Lender (the “Effective
Date”).

The Principal Sum is $105,000 plus accrued and unpaid interest and any other
fees. The loan amount will be evidenced by a Convertible Debenture issued by the
Borrower to the Lender, including all material terms of this Agreement. The
Convertible Debenture shall be issued at an approximate 4.76% Original Issue
Discount, such that the total amount that the Lender shall provide to the
Borrower under this Agreement shall be $100,000 (the “Discounted Amount”). The
Discounted Amount shall be paid by Lender, as follows: (i) $100,000 in cash
initially, after the lender has received proof from the borrower and its
transfer agent of common shares being irrevocably placed in a reserve account
for benefit of the lender (ii) such further amounts as shall be agreed by the
Lender and the Borrower, up to the Discounted Amount. All installments shall be
payable under a full recourse Convertible Debenture(s) for $105,000 (the
“Investor Note”) or such lesser amount as appropriate should the lender provide
an amount that is less than the total Discounted Amount, subject to certain
prepayment requirements, set forth below.

The prepayment of any amount of the Principal Sum shall be subject to a
prepayment penalty. Upon prepayment, the Company shall be required to pay the
principal amount outstanding, plus all accrued and unpaid interest plus all
expenses and fees plus a prepayment penalty as further outlined herein.

The Maturity Date is September 30, 2015 unless earlier converted pursuant to the
Conversion section below.

At no time will the Lender convert any amount of the Debenture into common stock
that would result in the Lender owning more than 4.99% of the common stock
outstanding.

Furthermore:

1.

Prepayment Penalty. Prepayment of any amount of the Principal Sum shall be
subject to a prepayment premium. Upon prepayment, the Borrower shall be required
to pay the principal amount outstanding, plus all accrued and unpaid interest
plus all expenses and fees plus a prepayment penalty premium. Upon the
Prepayment Date the Company shall pay a prepayment penalty based upon the
following schedule: If prepayment is made within 60 days from the date of this
debenture then 125% of the outstanding principal balance plus all accrued and
unpaid interest thereon, if prepayment is made between 61-120 days from the date
of this debenture then 135% of the outstanding principal balance plus all
accrued and unpaid interest thereon, if prepayment is made between 121 days from
the date of this debenture and the maturity date then 150% of the outstanding
principal balance plus all accrued and unpaid interest thereon, (the
“Prepayment”).

   2.

Conversion(s). The Lender has the right, at any time after the Effective Date,
at its election, to convert all or part of the outstanding and unpaid Principal
Sum and accrued interest (and any other fees) under any convertible balance due
by the Borrower, into fully paid and non- assessable shares of common stock of
the Borrower as per this conversion formula: Number of shares receivable upon
conversion equals the dollar conversion amount divided by the Conversion Price.
The Conversion price is equal to the lower of: 50% of the lowest traded price
during the 20 trading days prior to the election to convert or 50% of the bid
price on the day of the conversion notice. Notice of Lender’s conversion may be
delivered to Borrower by method of Lender’s choice (including but not limited to
email, facsimile, mail, overnight courier, or personal delivery), and all
conversions shall be cashless and not require further payment from the Lender.
If no objection is delivered from Borrower to Lender regarding calculations in
the conversion notice within 24 hours of delivery of the conversion notice, the
Borrower shall have been thereafter deemed to have irrevocably confirmed and
irrevocably ratified such conversion notice and waived any objection thereto.
The Borrower shall deliver the shares from any conversion to Lender (in any name
directed by Lender) within two (2) business days of conversion notice delivery.

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In the event that the outstanding shares of the common stock subject to the
conversion are changed into or exchanged for a different number or kind of
shares of the Borrower or other securities of the Borrower by reason of merger,
consolidation, re-capitalization, re-classification, stock split, stock dividend
or combination of shares, the Borrower shall make an appropriate and equitable
adjustment in the number and kind of shares as to which the conversion shall be
applicable, to the end that after such event the Lender’s proportionate interest
is preserved after the occurrence of such event.

   3.

Convertible Debenture. The borrowings under this Agreement shall be evidenced by
a Convertible Debenture, in the form attached as Exhibit A, hereto.

   4.

Conversion Delays. If Borrower fails to deliver shares in accordance with the
timeframe stated in Section 2; the Lender, at any time prior to selling all of
those shares, may rescind any portion, in whole or in part, of that particular
conversion attributable to the unsold shares and have the rescinded conversion
amount returned to the Principal Sum with the rescinded conversion shares
returned to the Borrower (under Lender’s and Borrower’s expectations that any
returned conversion amounts will tack back to the original date of the
Debenture). In addition, for each conversion, in the event that shares are not
delivered by the fourth business day (inclusive of the day of conversion), a
penalty of $2,000 per day will be assessed for each day after the third business
day (inclusive of the day of the conversion) until share delivery is made; and
such penalty will be added to the Principal Sum of the Debenture (under Lender’s
and Borrower’s expectations that any penalty amounts will tack back to the
original date of the Debenture).

   5.

Notification about balance of Authorized Shares. During the course of this
Agreement, the Borrower will notify the Lender if the balance of the unissued
authorized (and otherwise unreserved) shares falls below 100% of the required
minimum shares needed to fulfill conversion requirements under this agreement.
If so, the Lender has the right to suspend its impending installments until such
time sufficient shares are authorized to accommodate further conversions. The
borrower shall use commercially reasonable efforts to maintain at all times 100%
of the required minimum shares needed and if necessary shall amend the company’s
certificate or articles of incorporation to increase the number of authorized
but unissued shares of common stock to at least 100% of the required minimum at
such time, as soon as possible and in any event not later than the 60th day
after such date.

   6.

Terms of Future Financings. So long as the Debenture is outstanding, upon any
issuance by the Borrower or any of its subsidiaries of any security with any
term more favorable to the holder of such security or with a term in favor of
the holder of such security that was not similarly provided to the Lender in the
Debenture, then the Borrower shall notify the Lender of such additional or more
favorable term and such term, at Lender’s option, shall become a part of the
transaction documents with the Lender. The types of terms contained in another
security that may be more favorable to the holder of such security include, but
are not limited to, terms addressing conversion discounts.

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During the course of this agreement, the Borrower must notify the lender if any
of these conditions occur:

  (I)

If conversion shares are not deliverable by DWAC.

  (II)

If the shares are ineligible for deposit into the DTC system and only eligible
for Xclearing deposit.

7.

Default. The following are events of default under the Debenture and this
Agreement: (i) the Borrower shall fail to pay any principal under the Debenture
when due and payable (or payable by conversion) thereunder; or (ii) the Borrower
shall fail to pay any interest or any other amount under the Debenture when due
and payable (or payable by conversion) thereunder; or (iii) a receiver, trustee
or other similar official shall be appointed over the Borrower or a material
part of its assets and such appointment shall remain uncontested for twenty (20)
days or shall not be dismissed or discharged within sixty (60) days; or (iv) the
Borrower shall become insolvent or generally fails to pay, or admits in writing
its inability to pay, its debts as they become due, subject to applicable grace
periods, if any; or (v) the Borrower shall make a general assignment for the
benefit of creditors; or (vi) the Borrower shall file a petition for relief
under any bankruptcy, insolvency or similar law (domestic or foreign); or (vii)
an involuntary insolvency proceeding shall be commenced or filed against the
Borrower; or (viii) the Borrower shall lose its status as “DTC Eligible” or the
borrower’s shareholders shall lose the ability to deposit (either electronically
or by physical certificates, or otherwise) shares into the DTC System; or the
shares of the Borrower no longer allow for DWAC transfer for the shares; or (ix)
the Borrower shall become delinquent in its filing requirements as a
fully-reporting issuer registered with the SEC; or (x) the borrower shall fail
to maintain sufficient common shares authorized and available to satisfy the
lender’s conversions for as long as this debenture remains unpaid in whole or in
part.

   8.

Remedies. In the event of any default, the outstanding principal amount of the
Debenture, plus accrued but unpaid interest, liquidated damages, fees and other
amounts owing in respect thereof shall be accelerated and shall become, at the
Lender’s election, immediately due and payable in cash at the Mandatory Default
Amount. The Mandatory Default Amount means the greater of (i) the outstanding
principal amount of the Debenture, plus all accrued and unpaid interest,
liquidated damages, fees and other amounts hereon, divided by the Conversion
Price on the date the Mandatory Default Amount is either demanded or paid in
full, whichever has a lower Conversion Price, multiplied by the VWAP (volume
weighted average price) on the date the Mandatory Default Amount is either
demanded or paid in full, whichever has a higher VWAP, or (ii) 150% of the
outstanding principal amount of the Debenture, plus 100% of the accrued and
unpaid interest, liquidated damages, fees and other amounts hereon. Commencing
five (5) days after the occurrence of any event of default that results in the
acceleration of the Debenture, a default interest rate shall be applicable to
all borrowings. The default interest rate shall accrue at an interest rate equal
to the lesser of 18% per annum or the maximum rate permitted under applicable
law. In connection with such acceleration described herein, the Lender need not
provide, and the Borrower hereby waives, any presentment, demand, protest or
other notice of any kind, and the Lender may immediately and without expiration
of any grace period enforce any and all of its rights and remedies hereunder and
all other remedies available to it under applicable law. Such acceleration may
be rescinded and annulled by Lender at any time prior to payment hereunder and
the Lender shall have all rights as a holder of the note until such time, if
any, as the Lender receives full payment pursuant to this Section 10. No such
rescission or annulment shall affect any subsequent event of default or impair
any right consequent thereon. Nothing herein shall limit Lender’s right to
pursue any other remedies available to it at law or in equity including, without
limitation, a decree of specific performance and/or injunctive relief with
respect to the Borrower’s failure to timely deliver certificates representing
shares of Common Stock upon conversion of the Debenture as required pursuant to
the terms hereof.

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9.

No Short Selling. Lender must agree that as long as the Debenture from Borrower
to Lender remains outstanding, Lender will not short sell the Common Stock or
hedge the transaction which establishes a net short position with respect to the
Common Stock of Borrower. Borrower agrees that upon delivery of a conversion
notice by Lender, Lender will own the shares of Common Stock described in the
conversion notice and any sale of those shares issuable under such conversion
notice would not be considered a short sale.

   10.

Assignability. The Borrower may not assign the Debenture. The Debenture is
binding upon the Borrower and its successors and will inure to the benefit of
the Lender and its successors and assigns and may be assigned by the Lender to
anyone of its choosing without Borrower’s approval.

   11.

Governing Law. This Agreement will be governed by, and construed and enforced in
accordance with, the laws of the State of Delaware, without regard to the
conflict of laws principles thereof. Any action brought by either party against
the other concerning the transactions contemplated by this Agreement shall be
brought only in the state courts of New York or in the federal courts for
located in New York. Both parties and the individuals signing this Agreement
agree to submit to the jurisdiction of such courts.

   12.

Delivery of Process by Lender to Borrower. In the event of any action or
proceeding by Lender against Borrower, and only by Lender against Borrower,
service of copies of summons and/or complaint and/or any other process which may
be served in any such action or proceeding may be made by Lender via U.S. Mail,
overnight delivery service such as FedEx or UPS, email, fax, or process server,
or by mailing or otherwise delivering a copy of such process to the Borrower at
its last known attorney as set forth in its most recent SEC filing.

   13.

Attorney Fees. In the event any attorney is employed by either party to the
Debenture with regard to any legal or equitable action, arbitration or other
proceeding brought by such party for the enforcement of the Debenture or because
of an alleged dispute, breach, default or misrepresentation in connection with
any of the provisions of the Debenture, the prevailing party in such proceeding
will be entitled to recover from the other party reasonable attorneys' fees and
other costs and expenses incurred, in addition to any other relief to which the
prevailing party may be entitled. In connection with the issuance of the
Convertible Debenture, the Borrower shall pay attorney fees incurred by the
Lender of $5,000. Borrower shall also be responsible for payment of banking fees
as agreed with the investment banker.

   14.

Permitted Borrowings. Borrower shall have the right to enter into secured or
unsecured borrowings from commercial banks and comparable commercial credit
institutions for the purpose of financing inventory and fixed assets, upon
approval of the Board of Directors of the Borrower (“Permitted Borrowings”).
Permitted Borrowings shall not require the prior approval of the Lender. All
other borrowings by the Borrower shall be subject to the prior written approval
of the Lender.

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15.

Opinion of Counsel. In the event that an opinion of counsel is needed for any
matter related to the Debenture, Lender has the right to have any such opinion
provided by its counsel. Lender also has the right to have any such opinion
provided by Borrower’s counsel.

    16.

Notices. Any notice required or permitted hereunder (including Conversion
Notices) must be in writing and either personally served, sent by facsimile or
email transmission, or sent by overnight courier. Notices will be deemed
effectively delivered at the time of transmission if by facsimile or email, and
if by overnight courier the business day after such notice is deposited with the
courier service for delivery.

The Borrower The Lender     ________________________ _________________________

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Attachment A

CONVERTIBLE DEBENTURE

see attached

 

 

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