Document:

Exhibit 10.11 

 

DEBENTURE REGISTRATION
RIGHTS AGREEMENT

 

 

THIS DEBENTURE REGISTRATION
RIGHTS AGREEMENT (this “Agreement”), dated as of March 18, 2014, by and between MassRoots, Inc., a Delaware
corporation (the “Company”), and the undersigned (the “Holder”). The Company and the Holder
are hereinafter sometimes collectively referred to as the “Parties” and each a “Party” to
this Agreement.

 

RECITALS:

 

WHEREAS, upon the terms
and subject to the conditions of that certain Subscription Agreement, of even date herewith, by and between the Holder and the
Company (the “Subscription Agreement”), the Company has agreed to issue and sell to the Holder convertible debentures
and warrants of the Company, which will be convertible or exercisable into shares of common stock, $0.001 par value per share (the
“Common Stock”), of the Company; and

 

WHEREAS, to induce the
Holder to execute and deliver (i) the Subscription Agreement, (ii) this Agreement, (iii) that certain Debenture, of even date herewith,
by and between the Company and the Holder (the “Debenture”), and (vi) all agreements referenced in the foregoing
documents (collectively, the “Transaction Documents”), the Company has agreed to provide certain registration
rights under the Securities Act of 1933, as amended (the “Securities Act”) and the rules and regulations promulgated
thereunder, and applicable state securities laws, with respect to the shares of Common Stock issuable pursuant to the Transaction
Documents.

 

NOW, THEREFORE, for and
in consideration of the foregoing premises, the agreements and covenants herein contained, and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the Company and the Holder, intending to be legally bound, hereby
agree as follows:

 

 

1. Definitions. As used
in this Agreement, the following terms shall have the following meanings:

 

a.“Closing Date”
shall mean on or about March 24, 2014.

 

b.“Debentures” shall
mean the convertible debenture issued by the Company to the Holder pursuant to the Debenture.

 

c.“Holder” shall
mean the Parties other than the Company executing this Agreement.

 

d. “Effective Date”
shall mean the date the SEC declares the Registration Statement effective and the Company has filed all necessary amendments, including
the letter to request accelerated effectiveness and the Prospectus covering the resale of Shares.

 

    	 

    	 

    

e. “Face Amount”
means Four Hundred Seventy-Five Thousand U.S. Dollars ($475,000) to be invested in the aggregate by all of the Holders.

 

f. “Filing Date”
shall mean the date the Registration Statement has been filed with the SEC (as determined by EDGAR) and no stop order of acceptance
has been issued by the SEC.

 

g. “Person” means
a corporation, a limited liability company, an association, a partnership, an organization, a business, an individual, a governmental
or political subdivision thereof or a governmental agency.

 

h. “Potential Material Event”
means any of the following: (i) the possession by the Company of material information not ripe for disclosure in a Registration
Statement, which shall be evidenced by determinations in good faith by the Board of Directors of the Company that disclosure of
such information in the Registration Statement would be detrimental to the business and affairs of the Company, or (ii) any event
or activity concerning the Company which would, based on a good faith determination by the Company's Board of Directors, adversely
affect the Company or its shareholders if it were included in a Registration Statement or other filing.

 

i.“Principal Market”
means either The American Stock Exchange, Inc., The New York Stock Exchange, Inc., the Nasdaq National Market, The Nasdaq SmallCap
Market, OTC electronic bulletin board, or OTC Markets, whichever is the principal market on which the Common Stock is listed.

 

j. “Register”, “Registered”
and “Registration” refer to a registration effected by preparing and filing with
the SEC one or more Registration Statements in compliance with the Securities Act and pursuant to Rule 415 under the Securities
Act or any successor rule providing for offering securities on a continuous basis (“Rule 415”), and effectiveness
of such Registration Statement(s).

 

k. “Registrable Securities”
means the shares of Common Stock issued or issuable (i) pursuant to the Subscription Agreement and the Transaction Documents, and
(ii) any shares of capital stock issued or issuable with respect to such shares of Common Stock as a result of any stock split,
stock dividend, recapitalization, exchange or similar event or otherwise, which have not been (x) included in a Registration Statement
that has been declared effective by the SEC, (y) sold under circumstances meeting all of the applicable conditions of Rule 144,
promulgated under the Securities Act or (z) saleable without limitation as to time, manner and volume pursuant to Rule 144(k) (or
any similar provision then in force) under the Securities Act.

 

l.“Registration Statement”
means a registration statement of the Company filed under the Securities Act.

 

 

 

    	 

    	 

    

m.“SEC” means the
United States Securities and Exchange Commission.

 

All capitalized terms used
but not defined in this Agreement shall have the meaning ascribed to them in the Transaction Documents.

 

For the purposes of determining
dates for penalties or filing deadlines, as outlined in this Agreement, both parties agree that the date given by the SEC shall
constitute the official date.

 

2.Registration.

 

a.Mandatory Registration. Within
forty-five (45) days following the Closing Date, the Company shall prepare and file with the SEC a Registration Statement or Registration
Statements (as is necessary) covering the resale of all of the Registrable Securities, which Registration Statement(s) shall state
that, in accordance with Rule 415 promulgated under the Securities Act, such Registration Statement also covers such indeterminate
number of additional shares of Common Stock as may become issuable upon stock splits, stock dividends or similar transactions.
The Company shall initially register for resale an amount of shares of Common Stock which would be issuable on the date preceding
the filing of the Registration Statement based on the Conversion Price (as defined in the Debenture) of the Debenture or the Exercise
Price (as defined in the Warrant); or an amount equal to the maximum amount allowed under Rule 415 (a)(1)(i) as interpreted by
the SEC. In the event the Company cannot register sufficient shares of Common Stock, due to the remaining number of authorized
shares of Common Stock being insufficient, the Company will use its best efforts to register the maximum number of shares it can
based on the remaining balance of authorized shares and will use its best efforts to increase the number of its authorized shares
as soon as reasonably practicable.

 

b.The Company shall use its best efforts
to have the Registration Statement filed with the SEC within 45 days following the Closing Date. (“Filing Deadline”).
If the Registration Statement covering the Registrable Securities required to be filed by the Company pursuant to Section 2(a)
hereof is not filed by the Filing Deadline, then the Company shall pay the Holder the sum of two percent (2%) of the Face Amount
of the Debentures outstanding as liquidated damages, and not as a penalty.

 

Notwithstanding the foregoing,
the amounts payable by the Company pursuant to this Section 2 shall not be payable to the extent any delay in the filing
of the Registration Statement occurs because of an act of, or a failure to act or to act timely by the Holder or is otherwise attributable
to the Holder.

 

The liquidated damages set forth in this
Section 2 shall continue until the obligation is fulfilled and shall be paid, at the Holder's option in cash or common stock
priced at the Conversion Price, or portion thereof, until the Registration Statement is filed. Failure of the Company to make payment
within said three (3) business days shall be considered a breach of this Agreement, and the Holder may elect to pursue remedies
as outlined in this Section 2. 

 

    	 

    	 

    

The Company acknowledges
that its failure to have the Registration Statement filed by the Filing Deadline will cause the Holder to suffer irreparable harm,
and, that damages will be difficult to ascertain. Accordingly, the Parties agree that it is appropriate to include in this Agreement
a provision for liquidated damages. The Parties acknowledge and agree that the liquidated damages provision set forth in this section
represents the parties’ good faith effort to quantify such damages and, as such, agree that the form and amount of such liquidated
damages are reasonable and will not constitute a penalty. The payment of liquidated damages shall not relieve the Company from
its obligations to register the Common Stock and deliver the Common Stock pursuant to the terms of this Agreement, the Subscription
Agreement and the Debenture.

 

c.The Company shall use its best efforts
and take all available steps to have the Registration Statement declared effective by the SEC within one hundred eighty (180) calendar
days after the Filing Deadline (the “Effective Deadline”). If the Registration Statement covering the Registrable Securities
required to be filed by the Company pursuant to Section 2(a) hereof has
not become effective by the Effective Deadline,
then the Company shall pay the Holder the sum of two percent (2%) of the Face Amount as liquidated damages, and not as a penalty,
following the one hundred eighty (180) calendar day period until the Registration Statement becomes effective.

 

If the Registration Statement
covering the Registrable Securities required to be filed by the Company pursuant to Section 2(a) hereof has
become effective, and, thereafter, the Holder’s right to sell is suspended, for any reason, then the Company shall
pay the Holder the sum of two percent (2%) of the Face Amount plus interest and penalties due to the Holder for the Registrable
Securities pursuant to the Subscription Agreement for each ten (10) calendar day period, pro rata, compounded daily, following
the suspension, until such suspension ceases.

 

Notwithstanding the foregoing,
the amounts payable by the Company pursuant to this Section 2 shall not be payable to the extent any delay in the effectiveness
of the Registration Statement or any suspension of the effectiveness occurs because of an act of, or a failure to act or to act
timely by the Holder or is otherwise attributable to the Holder.

 

The damages set forth in this Section
2 shall continue until the obligation is fulfilled and shall be paid within three (3) business days after each ten (10) day
period, or portion thereof, until the Registration Statement is declared effective or such suspension is released. Failure of the
Company to make payment within said three (3) business days shall be considered a default. 

 

The Company acknowledges
that its failure to have the Registration Statement become
effective by the Effective Deadline or to permit the suspension of the effectiveness of the Registration Statement, will cause
the Holder to suffer irreparable harm and, that damages will be difficult to ascertain. Accordingly, the parties agree that it
is appropriate to include in this Agreement a provision for liquidated damages. The parties acknowledge and agree that the liquidated
damages provision set forth in this section represents the parties’ good faith effort to quantify such damages and, as such,
agree that the form and amount of such liquidated damages are reasonable and will not constitute a penalty. The payment of liquidated
damages shall not relieve the Company from its obligations to register the Common Stock and deliver the Common Stock pursuant to
the terms of this Agreement, the Subscription Agreement and the Debenture.

    	 

    	 

    

 

d. The Company agrees to only register
such securities as are necessary to meet its obligations to the Holder and agrees not to register additional securities without
the Holder's prior written consent to be agreed upon in writing by the Holder before the Filing Date.
Furthermore, the Company agrees that it will not file any other Registration Statement, including those on Form S-8 or Form
S-4, for other securities, until there is no balance left on the Debenture, unless it has the prior written approval from the Holder.
Failure to obtain prior written approval from the Holder will cause the Holder to suffer damages that will be difficult to ascertain.
Accordingly, the Parties agree that it is appropriate to include a provision for liquidated damages and the Company agrees to pay
the Holder the sum of two percent (2%) of the Face Amount as liquidated damages and not as a penalty for each thirty (30) calendar
day period, pro rata, compounded daily, until the unauthorized Registration Statement is withdrawn.

 

e.Mandatory filing with FINRA.
By the Effective Deadline, the Company shall have prepared with a Financial Investment Regulatory Authority (“FINRA”)
registered market maker (“Market Maker”), to; (i) file a Form 15c2-11 (“Form 15c”) with FINRA, to request
a trading symbol for, and as notification of its intentions for, the Common Stock to become publicly-traded and quoted on a Principal
Market, and (ii) as soon as the Company is able upon clearance of the Form 15c, cause the Market Maker and/or a securities clearing
firm to coordinate with the Depository Trust & Clearing Corporation (“DTCC”),to have the Common Stock eligible
for electronic clearing and transfer (“DTC Filing”, together with the Form 15c, the “15c Documents”). The
Form 15c , shall be filed within three (3) days of the Effective Date and the DTC Filing shall be made upon clearance of the Form
15c by FINRA.

 

The Company shall use its
best efforts to have the Form 15c filed with FINRA within three (3) days following the Effective Date (“15c Filing Deadline”).
If the 15c Documents required to be filed by the Company pursuant to Section 2(e) hereof are not filed by the 15c Filing
Deadline, then the Company shall pay the Holder the sum of two percent (2%) of the Face Amount of the Debentures outstanding as
liquidated damages, and not as a penalty.

 

Notwithstanding the foregoing,
the amounts payable by the Company pursuant to this Section 2 shall not be payable to the extent any delay in the filing
of the Form 15c occurs because of an act of, or a failure to act or to act timely by the Holder or is otherwise attributable to
the Holder.

 

The liquidated damages set forth in this
Section 2 shall continue until the obligation is fulfilled and shall be paid, at the Holder's option in cash or common stock
priced at the Conversion Price, or portion thereof, until the Form 15c is filed. Failure of the Company to make payment within
said three (3) business days shall be considered a breach of this Agreement, and the Holder may elect to pursue remedies as outlined
in this Section 2. 

 

The Company acknowledges
that its failure to have the Form 15c and the DTC Filing as provided herein will cause the Holder to suffer irreparable harm, and,
that damages will be difficult to ascertain. Accordingly, the Parties agree that it is appropriate to include in this Agreement
a provision for liquidated damages. The Parties acknowledge and agree that the

    	 

    	 

    

liquidated damages provision set forth in this
section represents the parties’ good faith effort to quantify such damages and, as such, agree that the form and amount of
such liquidated damages are reasonable and will not constitute a penalty. The payment of liquidated damages shall not relieve the
Company from its obligations to file and have declared effective, the 15c Documents, pursuant to the terms of this Agreement.

 

f.The Company shall use its best efforts
and take all available steps to have the 15c Documents declared effective by FINRA and DTCC, within sixty (60) calendar days after
the 15c Filing Deadline (“15c Documents Filing Deadline”). If the 15c Documents required to be filed by the Company
pursuant to Section 2(e) hereof have
not become effective within said 30-day period
of time, then the Company shall pay the Holder the sum of two percent (2%) of the Face Amount as liquidated damages, and not as
a penalty, following the thirty days (30) calendar day period until the 15c Documents become effective.

 

If the 15c Documents required
to be filed by the Company pursuant to Section 2(e) hereof have
become effective, and, thereafter, the Holder’s right to sell is suspended, for any reason, then the Company shall
pay the Holder the sum of two percent (2%) of the Face Amount plus interest and penalties due to the Holder for the Face Amount
pursuant to the Subscription Agreement for each ten (10) calendar day period, pro rata, compounded daily, following the suspension,
until such suspension ceases.

 

Notwithstanding the foregoing,
the amounts payable by the Company pursuant to this Section 2 shall not be payable to the extent any delay in the effectiveness
of the 15c Documents, or any suspension of the effectiveness occurs because of an act of, or a failure to act or to act timely
by the Holder or is otherwise attributable to the Holder.

 

The damages set forth in this Section
2 shall continue until the obligation is fulfilled and shall be paid within three (3) business days after each ten (10) day
period, or portion thereof, until the 15c Documents are declared effective or such suspension is released. Failure of the Company
to make payment within said three (3) business days shall be considered a default. 

 

The Company acknowledges
that its failure to have the 15c Documents become
effective within said 15c Documents Filing Deadline or to permit the suspension of the effectiveness of the 15c Documents,
will cause the Holder to suffer irreparable harm and, that damages will be difficult to ascertain. Accordingly, the parties agree
that it is appropriate to include in this Agreement a provision for liquidated damages. The parties acknowledge and agree that
the liquidated damages provision set forth in this section represents the parties’ good faith effort to quantify such damages
and, as such, agree that the form and amount of such liquidated damages are reasonable and will not constitute a penalty. The payment
of liquidated damages shall not relieve the Company from its obligations to register the Common Stock and deliver the Common Stock
pursuant to the terms of this Agreement, the Subscription Agreement and the Debenture.

 

 

    	 

    	 

    

3.Related
Obligations.

 

At such time as the Company
is obligated to prepare and file a Registration Statement with the SEC pursuant to Section 2(a) hereof, the Company will
use its best efforts to effect the registration of the Registrable Securities in accordance with the intended method of disposition
thereof and, with respect thereto, the Company shall have the following obligations:

 

 

a.The Company shall use its best efforts
to cause such Registration Statement relating to the Registrable Securities to become effective within one hundred eighty (180)
calendar days after the Filing Deadline and shall keep such Registration Statement effective pursuant to Rule 415 under the Securities
Act until the date on which (A) the Holder shall have sold all the Registrable Securities or the shares included therein otherwise
cease to be Registrable Securities, and (B) the Holder has no right to convert the securities it owns into Common Stock under the
Subscription Agreement or Debenture, respectively (the “Registration Period”), which Registration Statement
(including any amendments or supplements thereto and prospectuses contained therein) shall, as of the date thereof, not contain
any untrue statement of a material fact or omit to state a material fact required to be stated therein, or necessary to make the
statements therein, in light of the circumstances in which they were made, not misleading.

 

b.The Company shall prepare and file
with the SEC such amendments (including post-effective amendments) and supplements to a Registration Statement and the prospectus
used in connection with such Registration Statement, which prospectus is to be filed pursuant to Rule 424 under the Securities
Act, as may be necessary to keep such Registration Statement effective during the Registration Period, and, during such period,
comply with the provisions of the Securities Act with respect to the disposition of all Registrable Securities of the Company covered
by such Registration Statement until such time as all of such Registrable Securities shall have been disposed of in accordance
with the intended methods of disposition by the Holder as set forth in such Registration Statement. In the event the number of
shares of Common Stock available under a Registration Statement filed pursuant to this Agreement is at any time insufficient to
cover all of the Registrable Securities, the Company shall amend such Registration Statement, or file a new Registration Statement
(on the short form available therefor, if applicable), or both, so as to cover all of the Registrable Securities, in each case,
as soon as practicable, but in any event within thirty (30) calendar days after the necessity therefor arises (based on the then
Purchase Price of the Common Stock and other relevant factors on which the Company reasonably elects to rely), assuming the Company
has sufficient authorized shares at that time, and if it does not, within thirty (30) calendar days after such shares are authorized.
The Company shall use it best efforts to cause such amendment and/or new Registration Statement to become effective as soon as
practicable following the filing thereof.

 

Prior to conversion of
all the Shares (as defined in the Debenture) if at any time the conversion of all the Shares outstanding would result in an insufficient
number of authorized shares of Common Stock being available to cover all the conversions, or in the event that Holder deems that
the Shares authorized will become insufficient, the Company will move to call and hold a shareholder’s meeting within thirty
(30) calendar days for the sole purpose of authorizing additional shares of Common Stock to facilitate the conversions. In such
an event the Company shall recommend to all shareholders and management of the Company to vote their shares in

    	 

    	 

    

favor of increasing the authorized number of
shares of Common Stock in sufficient number to fully cover the Holder's conversion rights. The Company represents and warrants
that under no circumstances will it deny or prevent Holder’s right to convert the Shares as permitted under the terms of
the Subscription Agreement, this Agreement or any of the other Transaction Documents. The Holder retains the right to request additional
shares upon the determination the company may not be able to facilitate conversions in the future.

 

cThe Company shall furnish to the Holder
whose Registrable Securities are included in any Registration Statement and its legal counsel without charge and upon request (i)
promptly after the same is prepared and filed with the SEC at least one copy of such Registration Statement and any amendment(s)
thereto, including financial statements and schedules, all documents incorporated therein by reference and all exhibits, the prospectus
included in such Registration Statement (including each preliminary prospectus) and, with regards to such Registration Statement(s),
any correspondence by or on behalf of the Company to the SEC or the staff of the SEC and any correspondence from the SEC or the
staff of the SEC to the Company or its representatives, (ii) upon the effectiveness of any Registration Statement, a copy of the
prospectus included in such Registration Statement and all amendments and supplements thereto (or such other number of copies as
the Holder may reasonably request) and (iii) such other documents, including copies of any preliminary or final prospectus, as
the Holder may reasonably request from time to time in order to facilitate the disposition of the Registrable Securities. The Company
filing the documents described in this paragraph through EDGAR shall constitute delivery.

 

d.The Company shall use reasonable
efforts to (i) register and qualify the Registrable Securities covered by a Registration Statement under the applicable securities
or “blue sky” laws of such states of the United States as reasonably specified by the Holder, (ii) prepare and file
in those jurisdictions, such amendments (including post-effective amendments) and supplements to such registrations and qualifications
as may be necessary to maintain the effectiveness thereof during the Registration Period, (iii) take such other actions as may
be necessary to maintain such registrations and qualifications in effect at all times during the Registration Period, and (iv)
take all other actions reasonably necessary or advisable to qualify the Registrable Securities for sale in such jurisdictions;
provided, however, that the Company shall not be required in connection therewith or as a condition thereto to (x) qualify to do
business in any jurisdiction where it would not otherwise be required to qualify but for this Section 3(d), (y) subject
itself to general taxation in any such jurisdiction, or (z) file a general consent to service of process in any such jurisdiction.
The Company shall promptly notify the Holder who holds Registrable Securities of the receipt by the Company of any notification
with respect to the suspension of the registration or qualification of any of the Registrable Securities for sale under the securities
or “blue sky” laws of any jurisdiction in the United States or its receipt of actual notice of the initiation or threatening
of any proceeding for such purpose.

 

e. The Company shall immediately
notify the Holder in writing of the happening of any event as a result of which the prospectus included in a Registration Statement,
as then in effect, would then contain an untrue statement of a material fact or omission to state a material fact, which would
otherwise be required to be stated therein or necessary to make the statements therein, in light of the circumstances under which
they were made, not misleading;

    	 

    	 

    

and, as a result, is required to be supplemented
or as a result of which the Registration Statement is required to be amended (“Registration Default”) and use
all diligent efforts to promptly prepare any necessary supplement to such prospectus or amendment to such Registration Statement
and take any other necessary steps to cure the Registration Default, (which, if such Registration Statement is on Form S-3, may
consist of a document to be filed by the Company with the SEC pursuant to Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange
Act of 1934, as amended (the “Exchange Act”) and to be incorporated by reference in the prospectus) to correct
such untrue statement or omission, and deliver one (1) copy of such supplement or amendment to Holder (or such other number of
copies as Holder may reasonably request; delivery via EDGAR shall constitute delivery). Failure to cure the Registration Default
within five (5) business days shall result in the Company paying liquidated damages of two percent (2%) of the then outstanding
principal amount of the Debentures then held by the Holder for each thirty (30) calendar day period or portion thereof, beginning
on the date of suspension. The Company shall also promptly notify Holder in writing (i) when a prospectus or any prospectus supplement
or post-effective amendment has been filed, and when a Registration Statement or any post-effective amendment has become effective
(notification of such effectiveness shall be delivered to Holder by facsimile on the same day of such effectiveness and by overnight
mail), (ii) of any request by the SEC for amendments or supplements to a Registration Statement or related prospectus or related
information, (iii) of the Company's reasonable determination that a post-effective amendment to a Registration Statement would
be appropriate, (iv) in the event the Registration Statement is no longer effective or, (v) the Registration Statement is stale
for a period of more than five (5) Trading Days as a result of the Company’s failure to timely file its financials with the
SEC.

 

The Company acknowledges
that its failure to cure the Registration Default within three (3) business days will cause the Holder irreparable harm, and that
damages will be difficult to ascertain. Accordingly, the parties agree that it is appropriate to include in this Agreement a provision
for liquidated damages. The parties acknowledge and agree that the liquidated damages provision set forth in this section represents
the parties’ good faith effort to quantify such damages and, as such, agree that the form and amount of such liquidated damages
are reasonable and will not constitute a penalty.

 

It is the intention of
the parties that interest payable under any of the terms of this Agreement shall not exceed the maximum amount permitted under
any applicable law. If a law, which applies to this Agreement which sets the maximum interest amount, is finally interpreted so
that the interest in connection with this Agreement exceeds the permitted limits, then: (1) any such interest shall be reduced
by the amount necessary to reduce the interest to the permitted limit; and (2) any sums already collected (if any) from the Company
which exceed the permitted limits will be refunded to the Company. The Holder may choose to make this refund by reducing the amount
that the Company owes under this Agreement or by making a direct payment to the Company. If a refund reduces the amount that the
Company owes the Holder, the reduction will be treated as a partial payment. In the event that any provision of this Agreement
is held by a court of competent jurisdiction to be excessive in scope or otherwise invalid or unenforceable, such provision shall
be adjusted rather than voided, if possible, so that it is enforceable to the maximum extent possible, and the validity and enforceability
of the remaining provisions of this Agreement will not in any way be affected or impaired thereby.

    	 

    	 

    

 

f. The Company shall use its best efforts
to prevent the issuance of any stop order or other suspension of effectiveness of a Registration Statement, or the suspension of
the qualification of any of the Registrable Securities for sale in any jurisdiction and, if such an order or suspension is issued,
to obtain the withdrawal of such order or suspension at the earliest possible moment and to notify the Holder of the issuance of
such order and the resolution thereof. The Company will immediately notify the Holder of a proceeding, or threat of proceeding,
the result of which could affect the effectiveness of the registration statement.

 

g.The Company shall permit the Holder
and its counsel, of the Holder's choosing, to review and comment upon all Registration Statements, amendments and supplements,
at least seven (7) days prior to filing. The Company shall not file any Registration Statement with which Holder or its counsel
reasonably objects.

 

h.The Company shall make available
for inspection by (i) the Holder and (ii) one firm of attorneys and one firm of accountants or other agents retained by the Holder
(collectively, the “Inspectors”) all pertinent financial and other records, and pertinent corporate documents
and properties of the Company (collectively, the “Records”), as shall be reasonably deemed necessary by each
Inspector, and cause the Company's officers, directors and employees to supply all information which any Inspector may reasonably
request; provided, however, that each Inspector shall hold in strict confidence and shall not make any disclosure (except to the
Holder) or use of any Record or other information which the Company determines in good faith to be confidential, and of which determination
the Inspectors are so notified, unless (a) the disclosure of such Records is necessary to avoid or correct a misstatement or omission
in any Registration Statement or is otherwise required under the Securities Act, (b) the release of such Records is ordered pursuant
to a final, non-appealable subpoena or order from a court or government body of competent jurisdiction, or (c) the information
in such Records has been made generally available to the public other than by disclosure in violation of this or any other agreement
of which the Inspector has knowledge. The Holder agrees that it shall, upon learning that disclosure of such Records is sought
in or by a court or governmental body of competent jurisdiction or through other means, give prompt notice to the Company and allow
the Company, at its expense, to undertake appropriate action to prevent disclosure of, or to obtain a protective order for, the
Records deemed confidential.

 

i.The Company shall hold in confidence
and not make any disclosure of information concerning the Holder unless (i) disclosure of such information is necessary to comply
with federal or state securities laws, (ii) the disclosure of such information is necessary to avoid or correct a misstatement
or omission in any Registration Statement, (iii) the release of such information is ordered pursuant to a subpoena or other final,
non-appealable order from a court or governmental body of competent jurisdiction, or (iv) such information has been made generally
available to the public other than by disclosure in violation of this Agreement or any other agreement. The Company agrees that
it shall, upon learning that disclosure of such information concerning a Holder is sought in or by a court or governmental body
of competent jurisdiction or through other means, give prompt written notice to the Holder and allow the Holder, at the Holder's
expense, to undertake appropriate action to prevent disclosure of, or to obtain a protective order for, such information.

    	 

    	 

    

 

j.The Company shall use its best efforts
to secure designation and quotation of all the Registrable Securities covered by any Registration Statement on the Principal Market.
If, despite the Company's best efforts, the Company is unsuccessful in satisfying this obligation, it shall use its best efforts
to cause all the Registrable Securities covered by any Registration Statement to be listed on each other national securities exchange
and automated quotation system, if any, on which securities of the same class or series issued by the Company are then listed,
if any, if the listing of such Registrable Securities is then permitted under the rules of such exchange or system. If, despite
the Company's best efforts, the Company is unsuccessful in satisfying its obligation in this Section, it will use its best efforts
to secure the inclusion for quotation with Pink Sheets, LLC. The Company shall pay all fees and expenses in connection with satisfying
its obligation under this Section 3(k).

 

k.The Company shall cooperate with
the Holder to facilitate the timely preparation and delivery of certificates (not bearing any restrictive legend) representing
the Registrable Securities to be offered pursuant to a Registration Statement and enable such certificates to be in such denominations
or amounts, as the case may be, as the Holder may reasonably request and registered in such names of the Persons who shall acquire
such Registrable Securities from the Holder, as the Holder may request.

 

l.The Company shall provide a transfer
agent for all the Registrable Securities not later than the Effective Date of the first Registration Statement filed pursuant hereto.

 

m.If requested by the Holder, the Company
shall (i) as soon as reasonably practical, incorporate in a prospectus supplement or post-effective amendment such information
as Holder reasonably determines should be included therein relating to the sale and distribution of Registrable Securities, including,
without limitation, information with respect to the offering of the Registrable Securities to be sold in such offering; (ii) make
all required filings of such prospectus supplement or post-effective amendment as soon as notified of the matters to be incorporated
in such prospectus supplement or post-effective amendment; and (iii) supplement or make amendments to any Registration Statement
if reasonably requested by Holder.

 

n.The Company shall use its best efforts
to cause the Registrable Securities covered by the applicable Registration Statement to be registered with or approved by such
other governmental agencies or authorities as may be necessary to consummate the disposition of such Registrable Securities.

 

o.The Company shall make available
to the Holder as soon as reasonably practical, but not later than ninety (90) calendar days after the close of the period covered
thereby, an earnings statement (in form complying with the provisions of Rule 158 under the Securities Act) covering a 12-month
period beginning not later than the first day of the Company's fiscal quarter next following the effective date of any Registration
Statement. Filing via EDGAR shall constitute delivery.

 

    	 

    	 

    

p.The Company shall otherwise use its
best efforts to comply with all applicable rules and regulations of the SEC in connection with any registration hereunder.

 

q.Within one (1) business day after
the Registration Statement which includes Registrable Securities is declared effective by the SEC, the Company shall deliver, and
shall cause legal counsel for the Company to deliver, to the transfer agent for such Registrable Securities, with copies to the
Holder, confirmation that such Registration Statement has been declared effective by the SEC in the form attached hereto as Exhibit
A.

 

r.After the SEC declares the Registration
Statement cleared of all comments and the Company's acceptance of the effectiveness of the Registration Statement, the Company
shall file a prospectus covering the resale of the Shares (“Prospectus”) within two (2) trading days.

 

s.The Company shall take all other
reasonable actions necessary to expedite and facilitate disposition by the Holder of the Registrable Securities pursuant to a Registration
Statement.

 

 

 

4.Obligations
Of The Holder.

 

a.At least five (5) calendar days prior
to the first anticipated filing date of a Registration Statement, the Company shall notify the Holder in writing of the information
the Company requires from the Holder. The Holder covenants and agrees that, in connection with any resale of Registrable Securities
by it pursuant to a Registration Statement, it shall comply with the “Plan of Distribution” section of the current
prospectus relating to such Registration Statement.

 

b.The Holder, by the
Holder's acceptance of the Registrable Securities, agrees to cooperate with the Company as reasonably requested by the Company
in connection with the preparation and filing of any Registration Statement hereunder and in responding to SEC comments in connection
therewith.

 

c.The Holder agrees
that, upon receipt of any notice from the Company of the happening of any event of the kind described in Section 3(f) hereof
or the first sentence of Section 3(e) hereof, the Holder will immediately discontinue disposition of Registrable Securities
pursuant to any Registration Statement(s) covering such Registrable Securities until Holder's receipt of the copies of the supplemented
or amended prospectus contemplated by Section 3(f) hereof or the first sentence of Section 3(e) hereof.

 

    	 

    	 

    

5.Expenses
Of Registration.

 

All expenses, other than
underwriting discounts and commissions, incurred in connection with registrations, filings or qualifications pursuant to Section
2 and Section 3 hereof, including, without limitation, all registration, listing and qualifications fees, printing and
accounting fees, and reasonable fees and disbursements of counsel for the Company shall be paid by, and are the sole obligation
of, the Company.

 

6.Indemnification.

 

In the event any Registrable
Securities are included in a Registration Statement under this Agreement:

 

 

a.To the fullest extent permitted by
law, the Company will, and hereby agrees to, indemnify, hold harmless and defend the Holder who holds such Registrable Securities,
the directors, officers, partners, employees, agents, representatives of, and each Person, if any, who controls Holder within the
meaning of the Securities Act or the Exchange Act) (each, an “Indemnified Person”), against any losses, claims,
damages, liabilities, judgments, fines, penalties, charges, costs, attorneys' fees, amounts paid in settlement or expenses, joint
or several (collectively, “Claims”), incurred in investigating, preparing or defending any action, claim, suit,
inquiry, proceeding, investigation or appeal taken from the foregoing by or before any court or governmental, administrative or
other regulatory agency, body or the SEC, whether pending or threatened, whether or not an indemnified party is or may be a party
thereto (Indemnified Damages”), to which any of them may become subject insofar as such Claims (or actions or proceedings,
whether commenced or threatened, in respect thereof) arise out of or are based upon: (i) any untrue statement or alleged untrue
statement of a material fact in a Registration Statement or any post-effective amendment thereto or in any filing made in connection
with the qualification of the offering under the securities or other “blue sky” laws of any jurisdiction in which Registrable
Securities are offered (“Blue Sky Filing”), or the omission or alleged omission to state a material fact required
to be stated therein or necessary to make the statements therein, in light of the circumstances under which the statements therein
were made, not misleading, (ii) any untrue statement or alleged untrue statement of a material fact contained in the final prospectus
(as amended or supplemented, if the Company files any amendment thereof or supplement thereto with the SEC) or the omission or
alleged omission to state therein any material fact necessary to make the statements made therein, in light of the circumstances
under which the statements therein were made, not misleading, or (iii) any violation or alleged violation by the Company of the
Securities Act, the Exchange Act, any other law, including, without limitation, any state securities law, or any rule or regulation
thereunder relating to the offer or sale of the Registrable Securities pursuant to a Registration Statement (the matters in the
foregoing clauses (i) through (iii) being, collectively, “Violations”). Subject to the restrictions set forth
in Section 6(c) hereof with respect to the number of legal counsel, the Company shall reimburse the Holder and each such
controlling person, promptly as such expenses are incurred and are due and payable, for any reasonable legal fees or other reasonable
expenses incurred by them in connection with investigating or defending any such Claim. Notwithstanding anything to the contrary
contained herein, the indemnification agreement contained in this Section 6(a): (i) shall not apply to a Claim arising out
of or based upon a Violation committed by any

    	 

    	 

    

Indemnified Person or which occurs in reliance
upon and in conformity with information furnished in writing to the Company by any Indemnified Person expressly for use in connection
with the preparation of the Registration Statement or any such amendment thereof or supplement thereto, if such prospectus were
timely made available by the Company pursuant to Section 3(c) hereof; (ii) shall not be available to the extent such Claim
is based on (a) a failure of the Holder to deliver or to cause to be delivered the prospectus made available by the Company or
(b) the Indemnified Person's use of an incorrect prospectus despite being promptly advised in advance by the Company in writing
not to use such incorrect prospectus; and (iii) shall not apply to amounts paid in settlement of any Claim if such settlement is
effected without the prior written consent of the Company, which consent shall not be unreasonably withheld. Such indemnity shall
remain in full force and effect regardless of any investigation made by or on behalf of the Indemnified Person and shall survive
the resale of the Registrable Securities by the Holder pursuant to the Registration Statement.

 

b.Promptly after receipt by an Indemnified
Person or Indemnified Party under this Section 6 of notice of the commencement of any action or proceeding (including any
governmental action or proceeding) involving a Claim, such Indemnified Person or Indemnified Party shall, if a Claim in respect
thereof is to be made against any indemnifying party under this Section 6, deliver to the indemnifying party a written notice
of the commencement thereof, and the indemnifying party shall have the right to participate in, and, to the extent the indemnifying
party so desires, jointly with any other indemnifying party similarly noticed, to assume control of the defense thereof with counsel
mutually satisfactory to the indemnifying party and the Indemnified Person or the Indemnified Party, as the case may be; provided,
however, that an Indemnified Person or Indemnified Party shall have the right to retain its own counsel with the fees and expenses
to be paid by the indemnifying party, if, in the reasonable opinion of counsel retained by the indemnifying party, the representation
by such counsel of the Indemnified Person or Indemnified Party and the indemnifying party would be inappropriate due to actual
or potential differing interests between such Indemnified Person or Indemnified Party and any other party represented by such counsel
in such proceeding. The indemnifying party shall pay for only one separate legal counsel for the Indemnified Persons or the Indemnified
Parties, as applicable, and such counsel shall be selected by the Holder, if the Holder is entitled to indemnification hereunder,
or the Company, if the Company is entitled to indemnification hereunder, as applicable. The Indemnified Party or Indemnified Person
shall cooperate fully with the indemnifying party in connection with any negotiation or defense of any such action or claim by
the indemnifying party and shall furnish to the indemnifying party all information reasonably available to the Indemnified Party
or Indemnified Person which relates to such action or claim. The indemnifying party shall keep the Indemnified Party or Indemnified
Person fully apprised at all times as to the status of the defense or any settlement negotiations with respect thereto. No indemnifying
party shall be liable for any settlement of any action, claim or proceeding effected without its written consent, provided, however,
that the indemnifying party shall not unreasonably withhold, delay or condition its consent. No indemnifying party shall, without
the consent of the Indemnified Party or Indemnified Person, consent to entry of any judgment or enter into any settlement or other
compromise which does not include as an unconditional term thereof the giving by the claimant or plaintiff to such Indemnified
Party or Indemnified Person of a release from all liability in respect to such Claim. Following indemnification as provided for
hereunder, the indemnifying party shall be subrogated

    	 

    	 

    

to all rights of the Indemnified Party or Indemnified
Person with respect to all third parties, firms or corporations relating to the matter for which indemnification has been made.
The failure to deliver written notice to the indemnifying party within a reasonable time of the commencement of any such action
shall not relieve such indemnifying party of any liability to the Indemnified Person or Indemnified Party under this Section
6, except to the extent that the indemnifying party is actually prejudiced in its ability to defend such action.

 

c.The indemnification required by this
Section 6 shall be made by periodic payments of the amount thereof during the course of the investigation or defense, as
and when bills are received or Indemnified Damages are incurred.

 

d.The indemnity agreements contained
herein shall be in addition to (i) any cause of action or similar right of the Indemnified Party or Indemnified Person against
the indemnifying party or others, and (ii) any liabilities the indemnifying party may be subject to pursuant to the law.

 

7.Contribution.

 

To the extent any indemnification
by an indemnifying party is prohibited or limited by law, the indemnifying party agrees to make the maximum contribution with respect
to any amounts for which it would otherwise be liable under Section 6 hereof to the fullest extent permitted by law; provided,
however, that: (i) no contribution shall be made under circumstances where the maker would not have been liable for indemnification
under the fault standards set forth in Section 6 hereof; (ii) no seller of Registrable Securities guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any seller of Registrable Securities
who was not guilty of fraudulent misrepresentation; and (iii) contribution by any seller of Registrable Securities shall be limited
in amount to the net amount of proceeds received by such seller from the sale of such Registrable Securities.

 

8.Reports Under The Exchange
Act.

With a view to making available
to the Holders the benefits of Rule 144 under the Securities Act or any similar rule or regulation of the SEC that may at any time
permit the Investors to sell securities of the Company to the public without registration (“Rule 144”) the Company
agrees to:

a.make and keep public information available, as those terms
are understood and defined in Rule 144;

 

b.file with the SEC in a timely manner
all reports and other documents required of the Company under the Securities Act and the Exchange Act so long as the Company remains
subject to such requirements and the filing of such reports and other documents as are required by the applicable provisions of
Rule 144; and

 

    	 

    	 

    

c.furnish to the Holder so long as
the Holder owns Registrable Securities, promptly upon request, (i) a written statement by the Company that it has complied with
the reporting requirements of Rule 144, the Securities Act and the Exchange Act, (ii) a copy of the most recent annual or quarterly
report of the Company and such other reports and documents so filed by the Company, and (iii) such other information as may be
reasonably requested to permit the Investors to sell such securities pursuant to Rule 144 without registration.

 

9.No
Assignment Of Registration Rights.

 

The registration rights
and obligations under this Agreement shall not be assignable.

 

10.Amendment
Of Registration Rights.

 

Provisions of this Agreement
may be amended and the observance thereof may be waived (either generally or in a particular instance and either retroactively
or prospectively), only with the written consent of both the Company and the Holder of the Registrable Securities. Any amendment
or waiver effected in accordance with this Section 10 shall be binding upon the Holder and the Company. No such amendment
shall be effective to the extent that it applies to less than all of the Holders of the Registrable Securities. No consideration
shall be offered or paid to any Person to amend or consent to a waiver or modification of any provision of any of this Agreement
unless the same consideration also is offered to all of the parties to this Agreement.

 

11.Miscellaneous.

 

a.Any notices, consents, waivers or
other communications required or permitted to be given under the terms of this Agreement must be in writing and will be deemed
to have been delivered (i) upon receipt, when delivered personally; (ii) upon receipt, when sent by facsimile (provided a confirmation
of transmission is mechanically or electronically generated and kept on file by the sending party); or (iii) one (1) day after
deposit with a nationally recognized overnight delivery service, in each case properly addressed to the party to receive the same.
The addresses for such communications shall be:

 

If to the Company:MassRoots, Inc.

Ste 370 #150

6525 Gunpark Drive,

Boulder, CO 80301

 

If to the Holder:Name:

Address:

 

Each party shall provide
five (5) business days prior notice to the other party of any change in address, phone number or facsimile number.

 

    	 

    	 

    

b.Failure of any Party to exercise
any right or remedy under this Agreement or otherwise, or delay by a party in exercising such right or remedy, shall not operate
as a waiver thereof.

 

c. All disputes arising under this
Agreement shall be governed by and interpreted in accordance with the laws of the Commonwealth of Massachusetts, without regard
to principles of conflict of laws. The Parties shall submit all disputes arising under this Agreement to arbitration in Boston,
Massachusetts before a single arbitrator of the American Arbitration Association (the “AAA”). The arbitrator
shall be selected by application of the rules of the AAA, or by mutual agreement of the parties, except that such arbitrator shall
be an attorney admitted to practice law in the Commonwealth of Massachusetts. No Party shall challenge the jurisdiction or venue
provisions as provided in this Section. Nothing in this Section shall limit the Holder's right to obtain an injunction for a breach
of this Agreement from a court of law. Any injunction obtained shall remain in full force and effect until the arbitrator, as set
forth in section c., fully adjudicates the dispute.

 

d.This Agreement and the Transaction
Documents constitute the entire set of agreements among the parties hereto with respect to the subject matter hereof and thereof.
There are no restrictions, promises, warranties or undertakings, other than those set forth or referred to in the Transaction Documents.

 

e.This Agreement and the Transaction
Documents supersede all prior agreements and understandings among the parties hereto with respect to the subject matter hereof
and thereof.

 

f.The headings in this Agreement are
for convenience of reference only and shall not limit or otherwise affect the meaning hereof.

 

g.This Agreement may be executed in
two or more counterparts, all of which taken together shall constitute one instrument. Execution and delivery of this Agreement
by exchange of facsimile copies bearing the facsimile signature of a party shall constitute a valid and binding execution and delivery
of this Agreement by such party. Such facsimile copies shall constitute enforceable original documents.

 

h.Each Party shall do and perform,
or cause to be done and performed, all such further acts and things, and shall execute and deliver all such other agreements, certificates,
instruments and documents, as the other Party may reasonably request in order to carry out the intent and accomplish the purposes
of this Agreement and the consummation of the transactions contemplated hereby.

 

i.All consents and other determinations
to be made by the Holder pursuant to this Agreement shall be made, unless otherwise specified in this Agreement, by the Holder
holding a majority of the Registrable Securities.

 

    	 

    	 

    

j.The language used in this Agreement
will be deemed to be the language chosen by the Parties to express their mutual intent and no rules of strict construction will
be applied against any party.

 

k.The Company hereby represent and
warrants to the Holder that: (i) it has voluntarily entered into this Agreement of its own freewill, (ii) it is not entering into
this Agreement under economic duress, (iii) the terms of this Agreement are reasonable and fair to the Company, and (iv) the Company
has had independent legal counsel of its own choosing review this Agreement, advise the Company with respect to this Agreement,
and represent the Company in connection with its entering into this Agreement.

 

l.Notwithstanding anything in this
Agreement to the contrary, the parties hereto hereby acknowledge and agree to the following: (i) the Holder makes no representations
or covenants that it will not engage in trading in the securities of the Company; (ii) the Company has not and shall not provide
material non-public information to the Holder unless prior thereto the Holder shall have executed a written agreement regarding
the confidentiality and use of such information; and (iii) the Company understands and confirms that the Holder will be relying
on the acknowledgements set forth in clauses (i) through (iii) above if the Holder effects any transactions in the securities of
the Company.

 

12. Waiver.

 

The Holder's delay or failure
at any time or times hereafter to require strict performance by Company of any undertakings, agreements or covenants shall not
waive, affect, or diminish any right of the Holder under this Agreement to demand strict compliance and performance herewith. Any
waiver by the Holder of any Event of Default shall not waive or affect any other Event of Default, whether such Event of Default
is prior or subsequent thereto and whether of the same or a different type. None of the undertakings, agreements and covenants
of the Company contained in this Agreement, and no Event of Default, shall be deemed to have been waived by the Holder, nor may
this Agreement be amended, changed or modified, unless such waiver, amendment, change or modification is evidenced by an instrument
in writing specifying such waiver, amendment, change or modification and signed by the Holder.

 

13. Payment Of Liquidated Damages.

 

Any liquidated damages
or other fees incurred herein by the Company for failure to act in a timely manner shall be charged to the Face Amount of the Debenture
(as defined in the Debenture), unless specifically noted otherwise. The Holder reserves the rights to take payment of such amounts
in cash or in Common Stock priced at the Conversion Price (as defined in the Debenture).

 

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

    	 

    	 

    

 

 

IN WITNESS WHEREOF, the
parties hereto have caused this Debenture Registration Rights Agreement to be duly executed on the day and year first above written.

 

 

MassRoots,
Inc. 

 

 

By__________________Name:Isaac
Dietrich

Title: Chief
Executive Officer

 

 

 

			HOLDER

			

			

 

By: __________________________________

Name:

Title:

 

 

 

 

 

 

 

 

 

 

 

 

    	 

    	 

    

 

EXHIBIT A

 

FORM OF NOTICE OF EFFECTIVENESS

OF REGISTRATION STATEMENT

 

Date: __________

 

[TRANSFER AGENT]

 

Re:MassRoots,
Inc..

 

Ladies and Gentlemen:

 

We are counsel to MassRoots,
Inc., a Delaware corporation (the “Company”), and have represented the Company in connection with that certain
Subscription Agreement (the "Subscription Agreement") entered into by and among the Company and Dutchess the “Holder”
pursuant to which the Company has agreed to issue to the Holder shares of the Company's common stock, $0.001 par value per share
(the “Common Stock”) on the terms and conditions set forth in the Subscription Agreement. Pursuant to the Subscription
Agreement, the Company also has entered into a Registration Rights Agreement with the Holder (the “Registration Rights
Agreement”) pursuant to which the Company agreed, among other things, to register the Registrable Securities (as defined
in the Registration Rights Agreement), including the shares of Common Stock issued or issuable under the Subscription Agreement
under the Securities Act of 1933, as amended (the “Securities Act”). In connection with the Company's obligations
under the Registration Rights Agreement, on ____________ ___, 2014, the Company filed a Registration Statement on Form ________
(File No. 333-________) (the “Registration Statement”) with the United States Securities and Exchange Commission
(the “SEC”) relating to the Registrable Securities which names the Holder as a selling shareholder thereunder.

 

In connection with the
foregoing, we advise you that the Registration Statement
has become effective under the Securities Act at [enter the time of effectiveness] on [enter the date of effectiveness]
and to the best of our knowledge, after telephonic inquiry of a member of the SEC’s staff, no stop order suspending its effectiveness
has been issued and no proceedings for that purpose are pending before, or threatened by, the SEC and the Registrable Securities
are available for resale under the Securities Act pursuant to the Registration Statement.

 

Very truly yours,

 

[Company Counsel]

 

		By:	____________________Exhibit 10.12

MASSROOTS,
INC.

 

2014 STOCK
INCENTIVE PLAN

 

 

1.
Purpose

 

MassRoots,
Inc.’s 2014 Stock Incentive Plan is intended to promote the best interests of MassRoots, Inc. and its stockholders by (i) assisting
the Corporation and its Affiliates in the recruitment and retention of persons with ability and initiative, (ii) providing
an incentive to such persons to contribute to the growth and success of the Corporation’s businesses by affording such persons
equity participation in the Corporation and (iii) associating the interests of such persons with those of the Corporation
and its Affiliates and stockholders.

 

2.
Definitions

 

As
used in this Plan the following definitions shall apply:

 

A.          
“Affiliate” means (i) any Subsidiary, (ii) any Parent, (iii) any corporation, or trade or business
(including, without limitation, a partnership, limited liability company or other entity) which is directly or indirectly controlled
fifty percent (50%) or more (whether by ownership of stock, assets or an equivalent ownership interest or voting interest) by
the Corporation or one of its Affiliates, and (iv) any other entity in which the Corporation or any of its Affiliates has
a material equity interest and which is designated as an “Affiliate” by resolution of the Committee.

 

B.          
“Award” means any Option or Stock Award granted hereunder.

 

C.          
“Board” means the Board of Directors of the Corporation.

 

D.          
“Code” means the Internal Revenue Code of 1986, and any amendments thereto.

 

E.          
“Committee” means the Board or any Committee of the Board to which the Board has delegated any responsibility
for the implementation, interpretation or administration of this Plan.

 

F.           
“Common Stock” means the common stock, $0.001 par value, of the Corporation.

 

G.          
“Consultant” means (i) any person performing consulting or advisory services for the Corporation or any
Affiliate, or (ii) a director of an Affiliate.

 

H.         
“Corporation” means MassRoots, Inc., a Delaware corporation.

 

I.            
“Corporation Law” means the Delaware Revised Statutes, as the same shall be amended from time to time.

 

J.            
“Date of Grant” means the date that the Committee approves an Option grant; provided, that all terms of such
grant, including the amount of shares subject to the grant, exercise price and vesting are defined at such time.

 

K.          
“Deferral Period” means the period of time during which Deferred Shares are subject to deferral limitations
under Section 7.D of this Plan.

 

L.          
“Deferred Shares” means an award pursuant to Section 7.D of this Plan of the right to receive shares of Common
Stock at the end of a specified Deferral Period.

 

 

M.        
“Director” means a member of the Board.

 

N.          
 “Eligible Person” means an employee of the Corporation or an Affiliate (including a corporation that
becomes an Affiliate after the adoption of this Plan), a Director or a Consultant to the Corporation or an Affiliate (including
a corporation that becomes an Affiliate after the adoption of this Plan).

 

O.          
“Exchange Act” means the Securities Exchange Act of 1934, as amended.

 

P.           
 “Fair Market Value” means, on any given date, the current fair market value of the shares of Common Stock
as determined as follows:

 

		(i)	If
                                         the Common Stock is traded on a national securities exchange, the closing price for the
                                         day of determination as quoted on such market or exchange, including the NASDAQ Global
                                         Market or NASDAQ Capital Market, which is the primary market or exchange for trading
                                         of the Common Stock or if no trading occurs on such date, the last day on which trading
                                         occurred, or such other appropriate date as determined by the Committee in its discretion,
                                         as reported in The Wall Street Journal or such other source as the Committee deems
                                         reliable;

 

		(ii)	If
                                         the Common Stock is regularly quoted by a recognized securities dealer but selling prices
                                         are not reported, its Fair Market Value shall be the mean between the high and the low
                                         asked prices for the Common Stock for the day of determination; or

 

		(iii)	In
                                         the absence of an established market for the Common Stock, Fair Market Value shall be
                                         determined by the Committee in good faith.

 

Q.          
“Family Member” means a parent, child, spouse or sibling.

 

R.          
“Incentive Stock Option” means an Option (or portion thereof) intended to qualify for special tax treatment
under Section 422 of the Code.

 

S.           
 “Nonqualified Stock Option” means an Option (or portion thereof) which is not intended or does not for
any reason qualify as an Incentive Stock Option.

 

T.          
“Option” means any option to purchase shares of Common Stock granted under this Plan.

 

U.          
“Parent” means any corporation (other than the Corporation) in an unbroken chain of corporations ending with
the Corporation if each of the corporations (other than the Corporation) owns stock possessing at least fifty percent (50%) of
the total combined voting power of all classes of stock in one of the other corporations in such chain.

 

V.          
“Participant” means an Eligible Person who (i) is selected by the Committee or an authorized officer of
the Corporation to receive an Award and (ii) is party to an agreement setting forth the terms of the Award, as appropriate.

 

W.        
“Performance Agreement” means an agreement described in Section 8 of this Plan.

 

X.          
“Performance Objectives” means the performance objectives established by the Committee pursuant to this Plan
for Participants who have received grants of Awards. Performance Objectives may be described in terms of Corporation-wide objectives
or objectives that are related to the performance of the individual Participant or the Affiliate, division, department or function
within the Corporation or Affiliate in which the Participant is employed or has responsibility. Any Performance Objectives applicable
to Awards to the extent that such an Award is intended to qualify as “Performance Based Compensation” under Section
162(m) of the Code shall be limited to specified levels of or increases in the Corporation’s or a business unit’s
return on equity, earnings per share, total earnings, earnings growth, return on capital, return on assets, economic value added,
earnings before interest and taxes, earnings before interest, taxes, depreciation and amortization, sales growth, gross margin
return on investment, increase in the Fair Market Price of the shares, net operating profit, cash flow (including, but not limited
to, operating cash flow and free cash flow), cash flow return on investments (which equals net cash flow divided by total capital),
internal rate of return, increase in net present value or expense targets. The Awards intended to qualify as “Performance
Based Compensation” under Section 162(m) of the Code shall be pre-established in accordance with applicable regulations
under Section 162(m) of the Code and the determination of attainment of such goals shall be made by the Committee. If the Committee
determines that a change in the business, operations, corporate structure or capital structure of the Corporation (including an
event described in Section 9), or the manner in which it conducts its business, or other events or circumstances render the Performance
Objectives unsuitable, the Committee may modify such Performance Objectives or the related minimum acceptable level of achievement,
in whole or in part, as the Committee deems appropriate and equitable; provided, however, that no such modification shall be made
to an Award intended to qualify as “Performance Based Compensation” under Section 162(m) of the Code unless the Committee
determines that such modification will not result in loss of such qualification or the Committee determines that loss of such
qualification is in the best interests of the Corporation.

 

Y.          
“Performance Period” means a period of time established under Section 8 of this Plan within which the Performance
Objectives relating to a Stock Award are to be achieved.

 

Z.          
“Performance Share” means an award pursuant to Section 8 of this Plan of the right to receive shares of Common
Stock upon the achievement of specified Performance Objectives.

 

AA.     
“Plan” means this MassRoots, Inc., 2014 Stock Incentive Plan.

 

BB.     
“Repricing” means, other than in connection with an event described in Section 9 of this Plan, (i) lowering
the exercise price of an Option after it has been granted or (ii) canceling an Option at a time when the exercise price exceeds
the then-Fair Market Value of the Common Stock in exchange for another Option.

 

CC.     
“Restricted Stock Award” means an award of Common Stock under Section 7.B.

 

DD.     
“Securities Act” means the Securities Act of 1933, as amended.

 

EE.      
“Stock Award” means a Stock Bonus Award, Restricted Stock Award, Stock Appreciation Right, Deferred Shares,
or Performance Shares.

 

FF.       
“Stock Bonus Award” means an award of Common Stock under Section 7.A.

 

GG.     
“Stock Award Agreement” means a written agreement between the Corporation and a Participant setting forth the
specific terms and conditions of a Stock Award granted to the Participant under Section 7. Each Stock Award Agreement shall be
subject to the terms and conditions of this Plan and shall include such terms and conditions as the Committee shall authorize.

 

HH.    
“Stock Option Agreement” means an agreement (written or electronic) between the Corporation and a Participant
setting forth the specific terms and conditions of an Option granted to the Participant. Each Stock Option Agreement shall be
subject to the terms and conditions of this Plan and shall include such terms and conditions as the Committee shall authorize.

 

II.         
“Subsidiary” means any corporation (other than the Corporation) in an unbroken chain of corporations beginning
with the Corporation if each of the corporations (other than the last corporation in the unbroken chain) owns stock possessing
at least fifty percent (50%) of the total combined voting power of all classes of stock in one of the other corporations in such
chain.

 

JJ.         
“Ten Percent Owner” means any Eligible Person owning at the time an Option is granted more than ten percent
(10%) of the total combined voting power of all classes of stock of the Corporation or of a Parent or Subsidiary. An individual
shall, in accordance with Section 424(d) of the Code, be considered to own any voting stock owned (directly or indirectly) by
or for such Eligible Person’s brothers, sisters, spouse, ancestors and lineal descendants and any voting stock owned (directly
or indirectly) by or for a corporation, partnership, estate or trust shall be considered as being owned proportionately by or
for its stockholders, partners, or beneficiaries.

 

3.
implementation, interpretation and Administration

 

A.          
Delegation to Board Committee. The Board shall have the sole authority to implement, interpret, and/or administer this
Plan unless the Board delegates all or any portion of its authority to implement, interpret, and/or administer this Plan to a
Committee. To the extent not prohibited by the Certificate of Incorporation or Bylaws of the Corporation, the Board may delegate
all or a portion of its authority to implement, interpret, and/or administer this Plan to a Committee of the Board appointed by
the Board and constituted in compliance with the applicable Corporation Law. The Committee shall consist solely of two (2) or
more Directors who are (i) Non-Employee Directors (within the meaning of Rule 16b-3 under the Exchange Act) for purposes
of exercising administrative authority with respect to Awards granted to Eligible Persons who are subject to Section 16 of
the Exchange Act; (ii) to the extent required by the rules of the market on which the Corporation’s shares are traded
or the exchange on which the Corporation’s shares are listed, “independent” within the meaning of such rules;
and (iii) at such times as an Award under this Plan by the Corporation is subject to Section 162(m) of the Code (to the extent
relief from the limitation of Section 162(m) of the Code is sought with respect to Awards and administration of the Awards by
a committee of “outside directors” is required to receive such relief), “outside directors” within the
meaning of Section 162(m) of the Code.

 

B.          
Delegation to Officers. The Committee may delegate to one or more officers of the Corporation the authority to grant and
administer Awards to Eligible Persons who are not Directors or executive officers of the Corporation; provided that the Committee
shall have fixed the total number of shares of Common Stock that may be subject to such Awards. No officer holding such a delegation
is authorized to grant Awards to himself or herself. In addition to the Committee, the officer or officers to whom the Committee
has delegated the authority to grant and administer Awards shall have all powers delegated to the Committee with respect to such
Awards.

 

C.          
Powers of the Committee. Subject to the provisions of this Plan, and in the case of a Committee appointed by the Board,
the specific duties delegated to such Committee, the Committee (and the officers to whom the Committee has delegated such authority)
shall have the authority:

 

		(i)	To
                                         construe and interpret all provisions of this Plan and all Stock Option Agreements, Stock
                                         Award Agreements, Performance Agreements, or any other agreement under this Plan.

 

		(ii)	To
                                         determine the Fair Market Value of Common Stock in the absence of an established market
                                         for the Common Stock.

 

		(iii)	To
                                         select the Eligible Persons to whom Awards are granted from time to time hereunder.

 

		(iv)	To
                                         determine the number of shares of Common Stock covered by an Award; to determine whether
                                         an Option shall be an Incentive Stock Option or Nonqualified Stock Option; and to determine
                                         such other terms and conditions, not inconsistent with the terms of this Plan, of each
                                         such Award. Such terms and conditions include, but are not limited to, the exercise price
                                         of an Option, purchase price of Common Stock subject to a Stock Award, the time or times
                                         when Options or a Stock Award may be exercised or Common Stock issued thereunder, the
                                         vesting schedule of an Option, the right of the Corporation to repurchase Common Stock
                                         issued pursuant to the exercise of an Option or a Stock Award and other restrictions
                                         or limitations (in addition to those contained in this Plan) on the forfeitability or
                                         transferability of Options, Stock Awards or Common Stock issued upon exercise of an Option
                                         or pursuant to a Stock Award. Such terms may include conditions which shall be determined
                                         by the Committee and need not be uniform with respect to Participants.

 

		(v)	To
                                         accelerate the time at which any Option or Stock Award may be exercised, or the time
                                         at which a Stock Award or Common Stock issued under this Plan may become transferable
                                         or non-forfeitable.

 

		(vi)	To
                                         determine whether and under what circumstances an Option or Stock Award may be settled
                                         in cash, shares of Common Stock or other property under Section 6.H instead of in
                                         Common Stock.

 

		(vii)	To
                                         waive, amend, cancel, extend, renew, accept the surrender of, modify or accelerate the
                                         vesting of or lapse of restrictions on all or any portion of an outstanding Award. Except
                                         as otherwise provided by this Plan, Stock Option Agreement, Stock Award Agreement or
                                         Performance Agreement or as required to comply with applicable law, regulation or rule,
                                         no amendment, cancellation or modification shall, without a Participant’s consent,
                                         adversely affect any rights of the Participant; provided, however, that (x) an amendment
                                         or modification that may cause an Incentive Stock Option to become a Nonqualified Stock
                                         Option shall not be treated as adversely affecting the rights of the Participant and
                                         (y) any other amendment or modification of any Stock Option Agreement, Stock Award
                                         Agreement or Performance Agreement that does not, in the opinion of the Committee, adversely
                                         affect any rights of any Participant, shall not require such Participant’s consent.
                                         Notwithstanding the foregoing, the restrictions on the Repricing of Options, as set forth
                                         in this Plan, may not be waived.

 

		(viii)	To
                                         prescribe the form of Stock Option Agreements, Stock Award Agreements, Performance Agreements,
                                         or any other agreements under this Plan; to adopt policies and procedures for the exercise
                                         of Options or Stock Awards, including the satisfaction of withholding obligations; to
                                         adopt, amend, and rescind policies and procedures pertaining to the administration of
                                         this Plan; and to make all other determinations necessary or advisable for the administration
                                         of this Plan. Except for the due execution of the award agreement by both the Corporation
                                         and the Participant, the Award’s effectiveness will not be dependent on any signature
                                         unless specifically so provided in the award agreement.

 

The express
grant in this Plan of any specific power to the Committee shall not be construed as limiting any power or authority of the Committee;
provided that the Committee may not exercise any right or power reserved to the Board. Any decision made, or action taken, by
the Committee or in connection with the implementation, interpretation, and administration of this Plan shall be final, conclusive
and binding on all persons having an interest in this Plan.

 

4.
Eligibility

 

A.          
Eligibility for Awards. Awards, other than Incentive Stock Options, may be granted to any Eligible Person selected by the
Committee. Incentive Stock Options may be granted only to employees of the Corporation or a Parent or Subsidiary.

 

B.          
Eligibility of Consultants. A Consultant shall be an Eligible Person only if the offer or sale of the Corporation’s
securities would be eligible for registration on Form S-8 Registration Statement (or any successor form) because of the identity
and nature of the service provided by such person, unless the Corporation determines that an offer or sale of the Corporation’s
securities to such person will satisfy another exemption from the registration under the Securities Act and complies with the
securities laws of all other jurisdictions applicable to such offer or sale. Accordingly, an Award may not be granted pursuant
to this Plan for the purpose of the Corporation obtaining financing or for investor relations purposes.

 

C.          
Substitution Awards. The Committee may make Awards under this Plan by assumption, in substitution or replacement of performance
shares, phantom shares, stock awards, stock options or similar awards granted by another entity (including an Affiliate) in connection
with a merger, consolidation, acquisition of property or stock or similar transaction. Notwithstanding any provision of this Plan
(other than the maximum number of shares of Common Stock that may be issued under this Plan), the terms of such assumed, substituted,
or replaced Awards shall be as the Committee, in its discretion, determines is appropriate.

 

5.
Common Stock Subject to Plan

 

A.          
Share Reserve and Limitations on Grants. The maximum aggregate number of shares of Common Stock that may be (i) issued
under this Plan pursuant to the exercise of Options (without regard to whether payment on exercise of the Stock Option is made
in cash or shares of Common Stock), (ii) issued pursuant to Stock Awards shall be 4,000,000 shares. The number of shares of Common
Stock subject to the Plan shall be subject to adjustment as provided in Section 9. Notwithstanding any provision hereto to
the contrary, shares subject to the Plan shall include shares forfeited in a prior year as provided herein. For purposes of determining
the number of shares of Common Stock available under this Plan, shares of Common Stock withheld by the Corporation to satisfy
applicable tax withholding obligations pursuant to Section 10 of this Plan shall be deemed issued under this Plan. No single
participant may receive more than 25% of the total Options awarded in any single year.

 

B.          
Reversion of Shares. If an Option or Stock Award is terminated, expires or becomes unexercisable, in whole or in part,
for any reason, the unissued or unpurchased shares of Common Stock which were subject thereto shall become available for future
grant under this Plan. Shares of Common Stock that have been actually issued under this Plan shall not be returned to the share
reserve for future grants under this Plan; except that shares of Common Stock issued pursuant to a Stock Award which are forfeited
to the Corporation or repurchased by the Corporation at the original purchase price of such shares, shall be returned to the share
reserve for future grant under this Plan.

 

C.          
Source of Shares. Common Stock issued under this Plan may be shares of authorized and unissued Common Stock or shares of
previously issued Common Stock that have been reacquired by the Corporation.

 

6.
Options

 

A.          
Award. In accordance with the provisions of Section 4, the Committee will designate each Eligible Person to whom an
Option is to be granted and will specify the number of shares of Common Stock covered by such Option. The Stock Option Agreement
shall specify whether the Option is an Incentive Stock Option or Nonqualified Stock Option, the exercise price of such Option,
the vesting schedule applicable to such Option, the expiration date of such Option, events of termination of such Option, and
any other terms of such Option. No Option that is intended to be an Incentive Stock Option shall be invalid for failure to qualify
as an Incentive Stock Option.

 

B.          
Option Price. The exercise price per share for Common Stock subject to an Option shall be determined by the Committee,
but shall comply with the following:

 

		(i)	The
                                         exercise price per share for Common Stock subject to an Option shall not be less than
                                         one hundred percent (100%) of the Fair Market Value on the date of grant.

 

		(ii)	The
                                         exercise price per share for Common Stock subject to an Incentive Stock Option granted
                                         to a Participant who is deemed to be a Ten Percent Owner on the date such option is granted,
                                         shall not be less than one hundred ten percent (110%) of the Fair Market Value on the
                                         date of grant.

 

C.          
Maximum Option Period. The maximum period during which an Option may be exercised shall be ten (10) years from the
date such Option was granted. In the case of an Incentive Stock Option that is granted to a Participant who is or is deemed to
be a Ten Percent Owner on the date of grant, such Option shall not be exercisable after the expiration of five (5) years
from the date of grant.

 

D.          
Maximum Value of Options which are Incentive Stock Options. To the extent that the aggregate Fair Market Value of the Common
Stock with respect to which Incentive Stock Options granted to any Participant are exercisable for the first time during any calendar
year (under all stock option plans of the Corporation or any Parent or Subsidiary) exceeds $100,000 (or such other amount provided
in Section 422 of the Code), the Options shall not be deemed to be Incentive Stock Options. For purposes of this section,
the Fair Market Value of the Common Stock will be determined as of the time the Incentive Stock Option with respect to the Common
Stock is granted. This section will be applied by taking Incentive Stock Options into account in the order in which they are granted.

 

E.          
Nontransferability. Options granted under this Plan which are intended to be Incentive Stock Options shall be nontransferable
except by will or by the laws of descent and distribution and, during the lifetime of the Participant, shall be exercisable by
only the Participant to whom the Incentive Stock Option is granted. Except to the extent transferability of a Nonqualified Stock
Option is provided for in the Stock Option Agreement or is approved by the Committee, during the lifetime of the Participant to
whom the Nonqualified Stock Option is granted, such Option may be exercised only by the Participant. If the Stock Option Agreement
so provides or the Committee so approves, a Nonqualified Stock Option may be transferred by a Participant through a gift or domestic
relations order to the Participant’s family members to the extent such transfer complies with applicable securities laws
and regulations and provided that such transfer is not a transfer for value (within the meaning of applicable securities laws
and regulations). The holder of a Nonqualified Stock Option transferred pursuant to this section shall be bound by the same terms
and conditions that governed the Option during the period that it was held by the Participant. No right or interest of a Participant
in any Option shall be liable for, or subject to, any lien, obligation, or liability of such Participant, unless such obligation
is to the Corporation itself or to an Affiliate.

 

F.           
Vesting. Options will vest as provided in the Stock Option Agreement.

 

G.          
Termination. Options will terminate as provided in the Stock Option Agreement.

 

H.         
Exercise. Subject to the provisions of this Plan and the applicable Stock Option Agreement, an Option may be exercised
to the extent vested in whole at any time or in part from time to time at such times and in compliance with such requirements
as the Committee shall determine. A partial exercise of an Option shall not affect the right to exercise the Option from time
to time in accordance with this Plan and the applicable Stock Option Agreement with respect to the remaining shares subject to
the Option. An Option may not be exercised with respect to fractional shares of Common Stock. The Participant may face certain
restrictions on his/her ability to exercise Options and/or sell underlying shares when such Participant is potentially in possession
of insider information. The Corporation will make the Participant aware of any formal insider trading policy it adopts, and the
provisions of such insider trading policy (including any amendments thereto) shall be binding upon the Participant.

 

I.            
Payment. Unless otherwise provided by the Stock Option Agreement, payment of the exercise price for an Option shall be
made in cash or a cash equivalent acceptable to the Committee or if the Common Stock is traded on an established securities market,
by payment of the exercise price by a broker-dealer or by the Option holder with cash advanced by the broker-dealer if the exercise
notice is accompanied by the Option holder’s written irrevocable instructions to deliver the Common Stock acquired upon
exercise of the Option to the broker-dealer or by delivery of the Common Stock to the broker-dealer with an irrevocable commitment
by the broker-dealer to forward the exercise price to the Corporation. With the consent of the Committee, payment of all or a
part of the exercise price of an Option may also be made (i) by surrender to the Corporation (or delivery to the Corporation
of a properly executed form of attestation of ownership) of shares of Common Stock that have been held for such period prior to
the date of exercise as is necessary to avoid adverse accounting treatment to the Corporation, or (ii) any other method acceptable
to the Committee. If Common Stock is used to pay all or part of the exercise price, the sum of the cash or cash equivalent and
the Fair Market Value (determined as of the date of exercise) of the shares surrendered must not be less than the Option price
of the shares for which the Option is being exercised.

 

J.            
Stockholder Rights. No Participant shall have any rights as a stockholder with respect to shares subject to an Option until
the date of exercise of such Option and the certificate for shares of Common Stock to be received on exercise of such Option has
been issued by the Corporation.

 

K.          
Disposition and Stock Certificate Legends for Incentive Stock Option Shares. A Participant shall notify the Corporation
of any sale or other disposition of Common Stock acquired pursuant to an Incentive Stock Option if such sale or disposition occurs
(i) within two years of the grant of an Option or (ii) within one year of the issuance of the Common Stock to the Participant.
Such notice shall be in writing and directed to the Chief Financial Officer of the Corporation or is his/her absence, the Chief
Executive Officer. The Corporation may require that certificates evidencing shares of Common Stock purchased upon the exercise
of Incentive Stock Options issued under this Plan be endorsed with a legend in substantially the following form:

 

THE SHARES
EVIDENCED BY THIS CERTIFICATE MAY NOT BE SOLD OR TRANSFERRED PRIOR TO ___, 20___, IN THE ABSENCE OF A WRITTEN STATEMENT FROM THE
CORPORATION TO THE EFFECT THAT THE CORPORATION IS AWARE OF THE FACTS OF SUCH SALE OR TRANSFER.

 

          The
blank contained in this legend shall be filled in with the date that is the later of (i) one year and one day after the date of
the exercise of such Incentive Stock Option or (ii) two years and one day after the grant of such Incentive Stock Option.

 

L.          
No Repricing. In no event shall the Committee permit a Repricing of any Option without the approval of the stockholders
of the Corporation.

 

7.
Stock Awards

 

A.          
Stock Bonus Awards. Stock Bonus Awards may be granted by the Committee. Each Stock Award Agreement for a Stock Bonus Award
shall be in such form and shall contain such terms and conditions (including provisions relating to consideration, vesting, reacquisition
of shares following termination, and transferability of shares) as the Committee shall deem appropriate. The terms and conditions
of Stock Award Agreements for Stock Bonus Awards may change from time to time and need not be uniform with respect to Participants,
and the terms and conditions of separate Stock Bonus Awards need not be identical.

 

B.          
Restricted Stock Awards. Restricted Stock Awards may be granted by the Committee. Each Stock Award Agreement for a Restricted
Stock Award shall be in such form and shall contain such terms and conditions (including provisions relating to purchase price,
consideration, vesting, reacquisition of shares following termination, and transferability of shares) as the Committee shall deem
appropriate. The terms and conditions of the Stock Award Agreements for Restricted Stock Awards may change from time to time and
need not be uniform with respect to Participants, and the terms and conditions of separate Restricted Stock Awards need not be
identical. Vesting of any grant of Restricted Stock Awards may be further conditioned upon the attainment of Performance Objectives
established by the Committee in accordance with the applicable provisions of Section 8 of this Plan regarding Performance Shares.

 

C.          
Deferred Shares. The Committee may authorize grants of Deferred Shares to Participants upon the recommendation of the Corporation’s
management, and upon such terms and conditions as the Committee may determine in accordance with the following provisions:

 

		(i)	Each
                                         grant shall constitute the agreement by the Corporation to issue or transfer shares of
                                         Common Stock to the Participant in the future in consideration of the performance of
                                         services, subject to the fulfillment during the Deferral Period of such conditions as
                                         the Committee may specify.

 

		(ii)	Each
                                         grant may be made without additional consideration from the Participant or in consideration
                                         of a payment by the Participant that is less than the Fair Market Value on the date of
                                         grant.

 

		(iii)	Each
                                         grant shall provide that the Deferred Shares covered thereby shall be subject to a Deferral
                                         Period, which shall be fixed by the Committee on the date of grant, and any grant or
                                         sale may provide for the earlier termination of such period in the event of a change
                                         in control of the Corporation or other similar transaction or event.

 

		(iv)	During
                                         the Deferral Period, the Participant shall not have any right to transfer any rights
                                         under the subject Award, shall not have any rights of ownership in the Deferred Shares
                                         and shall not have any right to vote such shares, but the Committee may on or after the
                                         date of grant, authorize the payment of dividend or other distribution equivalents on
                                         such shares in cash or additional shares on a current, deferred or contingent basis.

 

		(v)	Any
                                         grant, or the vesting thereof, may be further conditioned upon the attainment of Performance
                                         Objectives established by the Committee in accordance with the applicable provisions
                                         of Section 8 of this Plan regarding Performance Shares.

 

		(vi)	Each
                                         grant shall be evidenced by an agreement delivered to and accepted by the Participant
                                         and containing such terms and provisions as the Committee may determine consistent with
                                         this Plan. The terms and conditions of the agreements for Deferred Shares may change
                                         from time to time and need not be uniform with respect to Participants, and the terms
                                         and conditions of separate Deferred Shares need not be identical.

 

8.
Performance Shares 

 

A.          
The Committee may authorize grants of Performance Shares, which shall become payable to the Participant upon the achievement of
specified Performance Objectives, upon such terms and conditions as the Committee may determine in accordance with the following
provisions:

 

		(i)	Each
                                         grant shall specify the number of Performance Shares to which it pertains, which may
                                         be subject to adjustment to reflect changes in compensation or other factors.

 

		(ii)	The
                                         Performance Period with respect to each Performance Share shall commence on the date
                                         established by the Committee and may be subject to earlier termination in the event of
                                         a change in control of the Corporation or similar transaction or event.

 

		(iii)	Each
                                         grant shall specify the Performance Objectives that are to be achieved by the Participant.

 

		(iv)	Each
                                         grant may specify in respect of the specified Performance Objectives a minimum acceptable
                                         level of achievement below which no payment will be made and may set forth a formula
                                         for determining the amount of any payment to be made if performance is at or above such
                                         minimum acceptable level but falls short of the maximum achievement of the specified
                                         Performance Objectives.

 

		(v)	Each
                                         grant shall specify the time and manner of payment of Performance Shares that shall have
                                         been earned, and any grant may specify that any such amount may be paid by the Corporation
                                         in cash, shares of Common Stock or any combination thereof and may either grant to the
                                         Participant or reserve to the Committee the right to elect among those alternatives.

 

		(vi)	Any
                                         grant of Performance Shares may specify that the amount payable with respect thereto
                                         may not exceed a maximum specified by the Committee on the date of grant.

 

		(vii)	Any
                                         grant of Performance Shares may provide for the payment to the Participant of dividend
                                         or other distribution equivalents thereon in cash or additional shares of Common Stock
                                         on a current, deferred or contingent basis.

 

		(viii)	If
                                         provided in the terms of the grant and subject to the requirements of Section 162(m)
                                         of the Code (in the case of awards intended to qualify for exception therefrom), the
                                         Committee may adjust Performance Objectives and the related minimum acceptable level
                                         of achievement if, in the sole judgment of the Committee, events or transactions have
                                         occurred after the date of grant that are unrelated to the performance of the Participant
                                         and result in distortion of the Performance Objectives or the related minimum acceptable
                                         level of achievement.

 

		(ix)	Each
                                         grant shall be evidenced by an agreement that shall be delivered to and accepted by the
                                         Participant, which shall state that the Performance Shares are subject to all of the
                                         terms and conditions of this Plan and such other terms and provisions as the Committee
                                         may determine consistent with this Plan. The terms and conditions of the agreements for
                                         Performance Shares may change from time to time and need not be uniform with respect
                                         to Participants, and the terms and conditions of separate Performance Shares need not
                                         be identical.

 

		(x)	Until
                                         the achievement of the Performance Objectives and the resulting issuance of the Performance
                                         Shares, the Participant shall not have any rights as a stockholder in the Performance
                                         Shares and shall not have any right to vote such shares, but the Committee may on or
                                         after the date of grant, authorize the payment of dividend or other distribution equivalents
                                         on such shares in cash or additional shares on a current, deferred or contingent basis.

 

9.
Changes in Capital Structure

 

A.          
No Limitations of Rights. The existence of outstanding Awards shall not affect in any way the right or power of the Corporation
or its stockholders to make or authorize any or all adjustments, recapitalizations, reorganizations or other changes in the Corporation’s
capital structure or its business, or any merger or consolidation of the Corporation, or any issuance of bonds, debentures, preferred
or prior preference stock ahead of or affecting the Common Stock or the rights thereof, or the dissolution or liquidation of the
Corporation, or any sale or transfer of all or any part of its assets or business, or any other corporate act or proceeding, whether
of a similar character or otherwise.

 

B.          
Changes in Capitalization. If the Corporation shall effect a subdivision or consolidation of shares or other capital readjustment,
the payment of a stock dividend, or other increase or reduction of the number of shares of the Common Stock outstanding, without
receiving consideration therefore in money, services or property, then (i) the number, class, and per share price of shares of
Common Stock subject to outstanding Options and other Awards hereunder and (ii) the number of and class of shares then reserved
for issuance under this Plan and the maximum number of shares for which Awards may be granted to a Participant during a specified
time period shall be appropriately and proportionately adjusted. The conversion of convertible securities of the Corporation shall
not be treated as effected “without receiving consideration.” The Committee shall make such adjustments, and its determinations
shall be final, binding and conclusive.

 

C.          
Merger, Consolidation or Asset Sale. If the Corporation is merged or consolidated with another entity or sells or otherwise
disposes of substantially all of its assets to another company while Options or Stock Awards remain outstanding under this Plan,
unless provisions are made in connection with such transaction for the continuance of this Plan and/or the assumption or substitution
of such Options or Stock Awards with new options or stock awards covering the stock of the successor company, or parent or subsidiary
thereof, with appropriate adjustments as to the number and kind of shares and prices, then all outstanding Options and Stock Awards
which have not been continued, assumed or for which a substituted award has not been granted shall, whether or not vested or then
exercisable, unless otherwise specified in the Stock Option Agreement or Stock Award Agreement, terminate immediately as of the
effective date of any such merger, consolidation or sale.

 

D.          
Limitation on Adjustment. Except as previously expressly provided, neither the issuance by the Corporation of shares of
stock of any class, or securities convertible into shares of stock of any class, for cash or property, or for labor or services
either upon direct sale or upon the exercise of rights or warrants to subscribe therefor, or upon conversion of shares or obligations
of the Corporation convertible into such shares or other securities, nor the increase or decrease of the number of authorized
shares of stock, nor the addition or deletion of classes of stock, shall affect, and no adjustment by reason thereof shall be
made with respect to, the number, class or price of shares of Common Stock then subject to outstanding Options or Stock Awards.

 

10.
Withholding of Taxes

 

          The
Corporation or an Affiliate shall have the right, before any certificate for any Common Stock is delivered, to deduct or withhold
from any payment owed to a Participant any amount that is necessary in order to satisfy any withholding requirement that the Corporation
or Affiliate in good faith believes is imposed upon it in connection with U.S federal, state, or local taxes, including transfer
taxes, as a result of the issuance of, or lapse of restrictions on, such Common Stock, or otherwise require such Participant to
make provision for payment of any such withholding amount. Subject to such conditions as may be established by the Committee,
the Committee may permit a Participant to (i) have Common Stock otherwise issuable under an Option or Stock Award withheld
to the extent necessary to comply with minimum statutory withholding rate requirements; (ii) tender back to the Corporation
shares of Common Stock received pursuant to an Option or Stock Award to the extent necessary to comply with minimum statutory
withholding rate requirements for supplemental income; (iii) deliver to the Corporation previously acquired Common Stock;
(iv) have funds withheld from payments of wages, salary or other cash compensation due the Participant; (v) pay the
Corporation or its Affiliate in cash, in order to satisfy part or all of the obligations for any taxes required to be withheld
or otherwise deducted and paid by the Corporation or its Affiliate with respect to the Option of Stock Award; or (vi) establish
a 10b5-1 trading plan for withheld stock designed to facilitate the sale of stock in connection with the vesting of such shares,
the proceeds of which shall be utilized to make all applicable withholding payments in a manner to be coordinated by the Corporation’s
Chief Financial Officer.

 

11.
Compliance with Law and Approval of Regulatory Bodies

 

A.          
General Requirements. No Option or Stock Award shall be exercisable, no Common Stock shall be issued, no certificates for
shares of Common Stock shall be delivered, and no payment shall be made under this Plan except in compliance with all applicable
federal and state laws and regulations (including, without limitation, withholding tax requirements), any listing agreement to
which the Corporation is a party, and the rules of all domestic stock exchanges or quotation systems on which the Corporation’s
shares may be listed. The Corporation shall have the right to rely on an opinion of its counsel as to such compliance. In the
absence of an effective and current registration statement on an appropriate form under the Securities Act, or a specific exemption
from the registration requirements of the Securities Act, shares of Common Stock issued under this Plan shall be restricted shares.
Any share certificate issued to evidence Common Stock when a Stock Award is granted or for which an Option is exercised may bear
such restrictive legends and statements as the Committee may deem advisable to assure compliance with federal and state laws and
regulations. No Option or Stock Award shall be exercisable, no Stock Award shall be granted, no Common Stock shall be issued,
no certificate for shares shall be delivered, and no payment shall be made under this Plan until the Corporation has obtained
such consent or approval as the Committee may deem advisable from regulatory bodies having jurisdiction over such matters.

 

B.          
Participant Representations. The Committee may require that a Participant, as a condition to receipt or exercise of a particular
award, execute and deliver to the Corporation a written statement, in form satisfactory to the Committee, in which the Participant
represents and warrants that the shares are being acquired for such person’s own account, for investment only and not with
a view to the resale or distribution thereof. The Participant shall, at the request of the Committee, be required to represent
and warrant in writing that any subsequent resale or distribution of shares of Common Stock by the Participant shall be made only
pursuant to either (i) a registration statement on an appropriate form under the Securities Act of 1933, which registration statement
has become effective and is current with regard to the shares being sold, or (ii) a specific exemption from the registration
requirements of the Securities Act of 1933, but in claiming such exemption the Participant shall, prior to any offer of sale or
sale of such shares, obtain a prior favorable written opinion of counsel, in form and substance satisfactory to counsel for the
Corporation, as to the application of such exemption thereto.

 

12.
General Provisions

 

A.          
Effect on Employment and Service. Neither the adoption of this Plan, its operation, nor any documents describing or referring
to this Plan (or any part thereof) shall (i) confer upon any individual any right to continue in the employ or service of the
Corporation or an Affiliate, (ii) in any way affect any right and power of the Corporation or an Affiliate to change an individual’s
duties or terminate the employment or service of any individual at any time with or without assigning a reason therefor or (iii) except
to the extent the Committee grants an Option or Stock Award to such individual, confer on any individual the right to participate
in the benefits of this Plan.

 

B.          
Use of Proceeds. The proceeds received by the Corporation from any sale of Common Stock pursuant to this Plan shall be
used for general corporate purposes.

 

C.          
Unfunded Plan. This Plan, insofar as it provides for grants, shall be unfunded, and the Corporation shall not be required
to segregate any assets that may at any time be represented by grants under this Plan. Any liability of the Corporation to any
Participant with respect to any grant under this Plan shall be based solely upon any contractual obligations that may be created
pursuant to this Plan. No such obligation of the Corporation shall be deemed to be secured by any pledge of, or other encumbrance
on, any property of the Corporation.

 

D.          
Rules of Construction. Headings are given to the Sections of this Plan solely as a convenience to facilitate reference.
The reference to any statute, regulation, or other provision of law shall be construed to refer to any amendment to or successor
of such provision of law.

 

E.           
Choice of Law. This Plan and all Stock Option Agreements, Stock Award Agreements, and Performance Agreements (or any other
agreements) entered into under this Plan shall be interpreted under the Corporation Law excluding (to the greatest extent permissible
by law) any rule of law that would cause the application of the laws of any jurisdiction other than the Corporation Law.

 

F.           
Fractional Shares. The Corporation shall not be required to issue fractional shares pursuant to this Plan. The Committee
may provide for elimination of fractional shares or the settlement of such fractional shares in cash.

 

G.          
Foreign Employees. In order to facilitate the making of any grant or combination of grants under this Plan, the Committee
may provide for such special terms for Awards to Participants who are foreign nationals, or who are employed by the Corporation
or any Affiliate outside of the United States, as the Committee may consider necessary or appropriate to accommodate differences
in local law, tax policy or custom. Moreover, the Committee may approve such supplements to, or amendments, restatements or alternative
versions of, this Plan as it may consider necessary or appropriate for such purposes without thereby affecting the terms of this
Plan, as then in effect, unless this Plan could have been amended to eliminate such inconsistency without further approval by
the stockholders of the Corporation.

 

13.
Amendment and Termination

 

          The
Board may amend or terminate this Plan from time to time; provided, however, stockholder approval shall be required for any amendment
that (i) increases the aggregate number of shares of Common Stock that may be issued under this Plan, except as contemplated
herein; (ii) changes the class of employees eligible to receive Incentive Stock Options; (iii) modifies the restrictions
on Repricings set forth in this Plan; or (iv) is required by the terms of any applicable law, regulation or rule, including
the rules of any market on which the Corporation shares are traded or exchange on which the Corporation shares are listed. Except
as specifically permitted by this Plan, any Stock Option Agreement or any Stock Award Agreement or as required to comply with
applicable law, regulation or rule, no amendment shall, without a Participant’s consent, adversely affect any rights of
such Participant under any Option or Stock Award outstanding at the time such amendment is made; provided, however, that an amendment
that may cause an Incentive Stock Option to become a Nonqualified Stock Option shall not be treated as adversely affecting the
rights of the Participant. Any amendment requiring stockholder approval shall be approved by the stockholders of the Corporation
within twelve (12) months of the date such amendment is adopted by the Board.

 

14.
Effective Date of Plan; Duration of Plan

 

A.          
This Plan shall be effective upon adoption by the Board, subject to approval within twelve (12) months by the stockholders
of the Corporation. Unless and until the Plan has been approved by the stockholders of the Corporation, no Option or Stock Award
may be exercised, no shares of Common Stock may be issued under this Plan. In the event that the stockholders of the Corporation
shall not approve the Plan within such twelve (12) month period, the Plan and any previously granted Options or Stock Awards
shall terminate.

 

B.          
Unless previously terminated, this Plan will terminate ten (10) years after the earlier of (i) the date this Plan is
adopted by the Board, or (ii) the date this Plan is approved by the stockholders, except that Awards that are granted under
this Plan prior to its termination will continue to be administered under the terms of this Plan until the Awards terminate, expire
or are exercised.

    	 

    	 

    

 

IN
WITNESS WHEREOF, the Corporation has caused this Plan to be executed by a duly authorized officer as of the date of adoption
of this Plan by the Board of Directors.

 

MASSROOTS, INC.

 

	By:	/s/ Isaac Dietrich	 	 
	 	Isaac Dietrich	 	 
	 	Cheif Executive Officer

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