STOCK
OPTION PLAN

    OF

    NORTH
AMERICAN MINERALS GROUP INC.

     

    1.             Purpose

     

    The
purpose of the Stock Option Plan (the "Plan") of NORTH AMERICAN MINERALS GROUP INC.,
a corporation incorporated under the Business Corporations Act
(Alberta) (the "Corporation") is to advance
the interests of the Corporation by encouraging the directors, officers,
employees and consultants of the Corporation. and of its subsidiaries and
affiliates, if any, to acquire common shares in the share capital of the
Corporation (the "Shares"),
thereby increasing their proprietary interest in the Corporation,
encouraging them to remain associated with the Corporation and furnishing them
with additional incentive in their efforts on behalf of the Corporation in the
conduct of its affairs.

     

    2.             Administration

     

    The Plan
shall be administered by the Board of Directors of the Corporation or by a
special committee of the directors appointed from time to time by the Board of
Directors of the Corporation pursuant to rules of procedure fixed by the Board
of Directors (such committee or, if no such committee is appointed, the Board of
Directors of the Corporation, is hereinafter referred to as the "Board"). A majority of the
Board shall constitute a quorum, and the acts of a majority of the directors
present at any meeting at which a quorum is present, or acts unanimously
approved in writing, shall be the acts of the directors.

     

    Subject
to the provisions of the Plan, the Board shall have authority to construe and
interpret the Plan and all option agreements entered into thereunder, to define
the terms used in the Plan and in all option agreements entered into thereunder,
to prescribe, amend and rescind rules and regulations relating to the Plan and
to make all other determinations necessary or advisable for the administration
of the Plan. All determinations and interpretations made by the Board shall be
binding and conclusive on all participants in the Plan and on their legal
personal representatives and beneficiaries.

     

    Each
option granted hereunder may be evidenced by an agreement in writing, signed on
behalf of the Corporation and by the optionee, in such form as the Board shall
approve. Each such agreement shall recite that it is subject to the provisions
of this Plan.

     

    3.             Stock
Exchange Rules

     

    All
options granted pursuant to this Plan shall be subject to rules and policies of
the TSX Venture Exchange and/ or any other stock exchange or exchanges on which
the common shares of the Corporation are then listed and any other regulatory
body having jurisdiction hereinafter (hereinafter collectively referred to as,
the "Exchange").

     

    4.             Shares
Subject to Plan

     

    Subject
to adjustment as provided in Section 16 hereof, the Shares to be offered under
the Plan shall consist of common shares of the Corporation's authorized but
unissued common shares. The aggregate number of Shares issuable upon the
exercise of all options granted under the Plan shall not exceed 10% of the
issued and outstanding common shares of the Corporation from time to time. If
any option granted hereunder shall expire or terminate for any reason in
accordance with the terms of the Plan without being exercised, the unpurchased
Shares subject thereto shall again be available for the purpose of this
Plan.


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    

     

    However,
other than in connection with a "Qualifying Transaction" (as defined in Policy
2.4 of the Exchange) or otherwise accepted by the Exchange, during the time that
the Corporation is a "Capital Pool Company" (as defined in Policy 2.4 of the
Exchange), the aggregate number of Shares issuable upon the exercise of all
options granted under the Plan shall not exceed 10% of the common shares of the
Corporation issued and outstanding at the closing of the Corporation's initial
public offering.

     

    5.        
      Maintenance of Sufficient
Capital

     

    The
Corporation shall at all times during the term of the Plan reserve and keep
available such numbers of Shares as will be sufficient to satisfy the
requirements of the Plan.

     

    6.            
  Eligibility and Participation

     

    Directors,
officers, consultants, and employees of the Corporation or its subsidiaries, and
employees of a person or company which provides management services to the
Corporation or its subsidiaries ("Management Company Employees")
shall be eligible for selection to participate in the Plan (such persons
hereinafter collectively referred to as "Participants"). Subject to
compliance with applicable requirements of the Exchange, Participants may elect
to hold options granted to them in an incorporated entity wholly owned by them
and such entity shall be bound by the Plan in the same manner as if the options
were held by the Participant.

     

    Subject
to the terms hereof, the Board shall determine to whom options shall be granted,
the terms and provisions of the respective option agreements, the time or times
at which such options shall be granted and vested, and the number of Shares to
be subject to each option. In the case of employees or consultants of the
Corporation or Management Company Employees, the option agreements to which they
are party must contain a representation of the Corporation that such employee,
consultant or Management Company Employee, as the case may be, is a bona fide
employee, consultant or Management Company Employee of the Corporation or its
subsidiaries.

     

    A
Participant who has been granted an option may, if such Participant is otherwise
eligible, and if permitted under the policies of the Exchange, be granted an
additional option or options if the Board shall so determine.

     

    7.        
       Exercise Price

     

    
      	
              (a)

            	
              The
      exercise price of the Shares subject to each option shall be determined by
      the Board, subject to applicable Exchange approval, at the time any option
      is granted. In no event shall such exercise price be lower than the
      exercise price permitted by the
Exchange.

            


    

     

    
      	
              (b)

            	
              Once
      the exercise price has been determined by the Board, accepted by the
      Exchange and the option has been granted, the exercise price of an option
      may only be reduced if at least 6 months have elapsed since the later of
      the date of the Commencement of the term, the date the Corporation's
      shares commenced trading or the date the exercise price was reduced. In
      the case of options held by insiders of the Corporation (as defined in the
      policies of the Exchange), the exercise price of an option may be reduced
      only if disinterested shareholder approval is
  obtained.

            


    

     

    8.            
  Number of Optioned Shares

     

    
      
        	
                (a) 

              	
                The
      number of Shares subject to an option granted to any one Participant shall
      be determined by the Board, but no one Participant shall be granted an
      option which exceeds the maximum number permitted by the
      Exchange.

              


      

    


    
      
         


      

      
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              (b)

            	
              No
      single Participant may be granted options to purchase a number of Shares
      equalling more than 5% of the issued common shares of the Corporation in
      any twelve-month period unless the Corporation has obtained disinterested
      shareholder approval in respect of such grant and meets applicable
      Exchange requirements.

            


    

     

    
      	
              (c)

            	
              Options
      shall not be granted if the exercise thereof would result in the issuance
      of more than 2% of the issued common shares of the Corporation in any
      twelve-month period to any one consultant of the Corporation (or any of
      its subsidiaries).

            


    

     

    
      
        	
                (d) 

              	
                Options
      shall not be granted if the exercise thereof would result in the issuance
      of more than 2% of the issued common shares of the Corporation in any
      twelve month period to persons employed to provide investor relation
      activities. Options granted to Consultants performing investor relations
      activities will contain vesting provisions such that vesting occurs over
      at least 12 months with no more than 1/4 of the options vesting in any 3
      month period.

              


      

    

     

    9.          
    Duration of Option

     

    Each
option and all rights thereunder shall be expressed to expire on the date set
out in the option agreement and shall be subject to earlier termination as
provided in Sections 11 and 12, provided that in no circumstances shall the
duration of an option exceed the maximum term permitted by the Exchange. For
greater certainty, if the Corporation is listed on the TSX Venture Exchange
("TSX Venture"), the
maximum term may not exceed 10 years if the Corporation is classified as a "Tier
I" issuer by the TSX Venture, and the maximum term may not exceed 5 years if the
Corporation is classified as a "Tier 2" issuer by the TSX Venture.

     

    10.             Option
Period, Consideration and Payment

     

    
      	
              (a)

            	
              The
      option period shall be a period of time fixed by the Board not to exceed
      the maximum term permitted by the Exchange, provided that the option
      period shall be reduced with respect to any option as provided in Sections
      11 and 12 covering cessation as
      a director, officer, consultant, employee or Management Company
      Employee of the Corporation or its subsidiaries, or death of the
      Participant.

            


    

     

    
      	
              (b)

            	
              Subject
      to any vesting restrictions imposed by the Exchange, the Board may, in its
      sole discretion, determine the time during which options shall vest and
      the method of vesting, or that no vesting restriction shall
      exist.

            


    

     

    
      	
              (c)

            	
              Subject
      to any vesting restrictions imposed by the Board, options may be exercised
      in whole or in part at any time and from time to time during the option
      period. To the extent required by the Exchange, no options may be
      exercised under this Plan until this Plan has been approved by a
      resolution duly passed by the shareholders of the
    Corporation.

            


    

     

    
      	
              (d)

            	
              Except
      as set forth in Sections 11 and 12, no option may be exercised unless the
      Participant is at the time of such exercise a director, officer,
      consultant, or employee of the Corporation or any of its subsidiaries, or
      a Management Company Employee of the Corporation or any of its
      subsidiaries.

            


    

     

    
      
        
          	
                  (e)

                	
                  The
      exercise of any option will be contingent upon receipt by the Corporation
      at its head office of a written notice of exercise, specifying the number
      of Shares with respect to which the option is being exercised, accompanied
      by cash payment, certified cheque or bank draft for the full purchase
      price of such Shares with respect to which the option is exercised. No
      Participant or his legal representatives, legatees or distributees will
      be, or will be deemed to be, a holder of any common shares of the
      Corporation unless and until the certificates for Shares issuable pursuant
      to options under the Plan are issued to him or them under the terms of the
      Plan.

                


        

      

    


    
      
         


      

      
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    11.             Ceasing
To Be a Director, Officer, Consultant or Employee

     

    
      	
              (a)

            	
              Subject
      to subsection (b), if a Participant shall cease to be a director, officer,
      consultant, employee of the Corporation, or its subsidiaries, or ceases to
      be a Management Company Employee, for any reason (other than death), such
      Participant may exercise his option to the extent that the Participant was
      entitled to exercise it at the date of such cessation, provided that such
      exercise must occur within 90 days after the Participant ceases to be a
      director, officer, consultant, employee or a Management Company
      Employee, unless such Participant was engaged in investor relations
      activities, in which case such exercise must occur within 30 days after
      the cessation of the Participant's services to the
      Corporation.

            


    

     

    
      	
              (b)

            	
              If
      the Participant does not continue to be a director, officer, consultant,
      employee of the Resulting Issuer upon completion of the Corporation's
      Qualifying Transaction (as such terms are defined in the policies of the
      Exchange), the options granted hereunder must be exercised by the
      Participant within the later of 12 months after completion of the
      Qualifying Transaction and 90 days after the Participant ceases to become
      a director, officer, consultant or employee of the Resulting
      Issuer.

            


    

     

    
      
        
          	
                  (c)

                	
                  Nothing
      contained in the Plan, nor in any option granted pursuant to the Plan,
      shall as such confer upon any Participant any right with respect to
      continuance as a director, officer, consultant, employee or Management
      Company Employee of the Corporation or of any of its subsidiaries or
      affiliates.

                


        

      

    

     

    12.             Death of
Participant

     

    Notwithstanding
section 11, in the event of the death of a Participant, the option previously
granted to him shall be exercisable only within the one (1) year after such
death and then only:

     

    
      	
              (a)

            	
              by
      the person or persons to whom the Participant's rights under the option
      shall pass by the Participant's will or the laws of descent and
      distribution; and

            


    

     

    
      	
              (b)

            	
              if
      and to the extent that such Participant was entitled to exercise the
      Option at the date of his death.

            


    

     

    13.             Rights
of Optionee

     

    No person
entitled to exercise any option granted under the Plan shall have any of the
rights or privileges of a shareholder of the Corporation in respect of any
Shares issuable upon exercise of such option until certificates representing
such Shares shall have been issued and delivered.

     

    14.             Proceeds
from Sale of Shares

     

    The
proceeds from the sale of Shares issued upon the exercise of options shall be
added to the general funds of the Corporation and shall thereafter be used from
time to time for such corporate purposes as the Board may
determine.

     

    
      
        
        

      

      
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    15.             Cash
Surrender Option

     

    Where the
Shares are listed and posted for trading on a recognized stock exchange,
Participants may elect to surrender, unexercised, options to purchase Shares
("Options") granted
pursuant to the Plan that are vested and
exercisable, to the Corporation in consideration of the receipt by the
Participant of an amount (the "Settlement Amount") equal to
the excess, if any, of the aggregate fair market value of the Shares (based on
the weighted average trading price of the Shares on such stock exchange during
the five trading days preceding the date of surrender or the price pursuant to
an offer made for all of the issued and outstanding Shares, whichever is
greater) able to be purchased pursuant to the vested and exercisable portion of
such Options on the date of surrender, over the aggregate exercise price for the
Shares pursuant to such Options. In no circumstances will the Participant at any
time be obligated to surrender Options as provided by this cash surrender
option. The Corporation may, in its sole discretion, refuse to accept the
surrender of unexercised Options and if any such surrender is not accepted by
the Corporation or completed for any reason, the notice of surrender (as
described below) shall be deemed to be withdrawn and the Options in respect of
which such notice was provided shall again become subject to their original
terms as if such notice of surrender had not been provided. Unexercised Options
may be surrendered in whole or in part from time to time by delivery to the
Corporation at its bead office of a written notice of surrender specifying the
number of Shares with respect to which the unexercised Options are being
surrendered. Upon the surrender of unexercised Options as aforesaid, the
Corporation shall use its reasonable efforts to forthwith deliver to the
relevant Participant (or his personal representative, if applicable) or to the
order thereof, payment of the Settlement Amount (net of any amounts required to
be withheld under applicable withholding legislation) by way of cheque or
otherwise in a manner acceptable to the Corporation.

     

    16.             Adjustments

     

    If the
outstanding common shares of the Corporation are increased, decreased, changed
into or exchanged for a different number or kind of shares or securities of the
Corporation or another corporation or entity through re-organization, merger,
re-capitalization, re-classification, stock dividend, subdivision or
consolidation, any adjustments relating to the Shares optioned or issued on
exercise of options and the exercise price per Share as set forth in the
respective stock option agreements shall be made in accordance to the terms of
such agreements.

     

    Adjustments
under this Section shall be made by the Board whose determination as to what
adjustments shall be made, and the extent thereof, shall be final, binding and
conclusive. No fractional Share shall be required to be issued under the Plan on
any such adjustment.

     

    17.             Transferability

     

    All
benefits, rights and options accruing to any Participant in accordance with the
terms and conditions of the Plan shall not be transferable or assignable unless
specifically provided herein or the extent, if any, permitted by the Exchange.
During the lifetime of a Participant any benefits, rights and options may only
be exercised by the Participant.

     

    18.             Amendment
and Termination of Plan

     

    Subject
to applicable approval of the Exchange, the Board may, at any time, suspend or
terminate the Plan. Subject to applicable approval of the Exchange, the Board
may also at any time amend or revise the terms of the Plan; provided that no
such amendment or revision shall result in a material adverse change to the
terms of any options theretofore granted under the Plan, unless shareholder
approval, or disinterested shareholder approval, as the case may be, is obtained
for such amendment or revision.

     

    
      
        
        

      

      
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    19.             Necessary
Approvals

     

    The
ability of a Participant to exercise options and the obligation of the
Corporation to issue and deliver Shares in accordance with the Plan is subject
to any approvals which may be required from shareholders of the
Corporation and any regulatory authority or stock exchange having jurisdiction
over the securities of the Corporation. If any Shares cannot be issued to any
Participant for whatever reason, the obligation of the Corporation to issue such
Shares shall terminate and any option exercise price paid to the Corporation
will be returned to the Participant.

     

    20.             Effective
Date of Plan

     

    The Plan
has been adopted by the Board of the Corporation subject to the approval of the
Exchange and, if so approved, subject to the discretion of the Board, the Plan
shall become effective upon such approvals being obtained.

     

    21.             Interpretation.

     

    The Plan
will be governed by and construed in accordance with the laws of the Province of
Alberta.

     

    MADE by
the Board of Directors of the Corporation as evidenced by the signature of the
following director duly authorized in that behalf, effective the 4th day of
January, 2008 and approved by the shareholders of the Corporation
on the 4th day of
January,
2008.

     

    
      
        
          
            
              	/s/
      Yosi Lapid
	
                      YOSI
      LAPID

                    
	
                      Director

                    


            

          

        

      

    

     

    
      
         


      

      
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