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MEGAWESTENERGYCORP. STOCK
OPTION PLAN

This Stock Option Plan (the "Plan") provides for the grant of options to acquire
common shares (the "Common Shares") in the capital of Megawest Energy Corp., a
corporation formed under the laws of the Province of British Columbia (the
"Corporation"). Stock options granted under this Plan that qualify under Section
422 of the Internal Revenue Code of 1986, as amended (the "Code") are referred
to in this Plan as "Incentive Stock Options" and stock options that do not
qualify under Section 422 of the Code are referred to as "Non-Qualified Stock
Options". Incentive Stock Options and Non-Qualified Stock Options granted under
this Plan are collectively referred to as "Options".

1.             PURPOSE

1.1           
The purpose of this Plan is to retain the services of valued key employees and
consultants of the Corporation and such other persons as the Plan Administrator
(as defined below) shall select in accordance with Section 2 below, and to
encourage such persons to acquire a greater proprietary interest in the
Corporation, thereby strengthening their incentive to achieve the objectives of
the shareholders of the Corporation, and to serve as an aid and inducement in
the hiring of new employees and to provide an equity incentive to consultants
and other persons selected by the Plan Administrator.

1.2           
This Plan shall at all times be subject to all legal requirements relating to
the administration of stock option plans, if any, under applicable corporate
laws, applicable United States federal and state securities laws, the Code, the
rules of any applicable stock exchange or stock quotation system, and the rules
of any foreign jurisdiction applicable to Options granted to residents therein
(collectively, the "Applicable Laws").

2.             
ADMINISTRATION

2.1           
This Plan shall be administered initially by the Board of Directors of the
Corporation (the "Board"), except that the Board may, in its discretion,
establish a committee composed of two (2) or more members of the Board or two
(2) or more other persons to administer the Plan, which committee (the
"Committee") may be an executive, compensation or other committee, including a
separate committee especially created for this purpose. The Board or, if
applicable, the Committee is referred to herein as the "Plan Administrator".

2.2           
If and so long as the Common Shares are registered under Section 12(b) or 12(g)
of the Securities Exchange Act of 1934, as amended (the "Exchange Act")
and the Corporation wishes to grant Incentive Stock Options, then the Board
shall consider in selecting the Plan Administrator and the membership of any
Committee, with respect to any persons subject or likely to become subject to
Section 16 of the Exchange Act, the provisions regarding (a) "outside directors"
as contemplated by Section 162(m) of the Code, and (b) "Non-Employee Directors"
as contemplated by Rule 16b-3 under the Exchange Act.

2.3           
The Committee shall have the powers and authority vested in the Board hereunder
(including the power and authority to interpret any provision of the Plan or of
any Option). The

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members of any such Committee shall serve at the pleasure of
the Board. A majority of the members of the Committee shall constitute a quorum,
and all actions of the Committee shall be taken by a majority of the members
present. Any action may be taken by a written instrument signed by all of the
members of the Committee and any action so taken shall be fully effective as if
it had been taken at a meeting.

2.4           
Subject to the provisions of this Plan and any Applicable Laws, and with a view
to effecting the purpose of the Plan, the Plan Administrator shall have sole
authority, in its absolute discretion, to:

(a)           
construe and interpret this Plan;

(b)           
define the terms used in the Plan;

(c)           
prescribe, amend and rescind the rules and regulations relating to this Plan;

(d)           
correct any defect, supply any omission or reconcile any inconsistency in this
Plan;

(e)           
grant Options under this Plan;

(f)           
determine the individuals to whom Options shall be granted under this Plan and
whether the Option is granted as an Incentive Stock Option or a Non-Qualified
Stock Option;

(g)           
determine the time or times at which Options shall be granted under this Plan;

(h)           
determine the number of Common Shares subject to each Option, the exercise price
of each Option, the duration of each Option and the times at which each Option
shall become exercisable;

(i)           
determine all other terms and conditions of the Options; and

(j)           
make all other determinations and interpretations necessary and advisable for
the administration of the Plan.

2.5           
All decisions, determinations and interpretations made by the Plan Administrator
shall be binding and conclusive on all participants in the Plan and on their
legal representatives, heirs and beneficiaries.

3.             
ELIGIBILITY

3.1           
Incentive Stock Options may be granted to any individual who, at the time the
Option is granted, is an employee of the Corporation or any Related Corporation
(as defined below) ("Employees").

3.2           
Non-Qualified Stock Options may be granted to Employees and to such other
persons who are not Employees as the Plan Administrator shall select, subject to
any Applicable Laws.

3.3           
Options may be granted in substitution for outstanding Options of another
corporation in connection with the merger, consolidation, acquisition of
property or stock or other

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reorganization between such other corporation and the
Corporation or any subsidiary of the Corporation. Options also may be granted in
exchange for outstanding Options.

3.4           
Any person to whom an Option is granted under this Plan is referred to as an
"Optionee". Any person who is the owner of an Option is referred to as a
"Holder".

3.5           
As used in this Plan, the term "Related Corporation" shall mean any corporation
(other than the Corporation) that is a "Parent Corporation" of the Corporation
or "Subsidiary Corporation" of the Corporation, as those terms are defined in
Sections 424(e) and 424(f), respectively, of the Code (or any successor
provisions) and the regulations thereunder (as amended from time to time).

4.             
STOCK

4.1           
The Plan Administrator is authorized to grant Options to acquire up to a total
of 20% of the issued and outstanding Common Shares from time to time less the
number of options granted under the 2004 Stock Option Plan. The number of Common
Shares with respect to which Options may be granted hereunder is subject to
adjustment as set forth in Section 5.1(m) hereof. In the event that any
outstanding Option expires or is terminated for any reason, the Common Shares
allocable to the unexercised portion of such Option may again be subject to an
Option granted to the same Optionee or to a different person eligible under
Section 3 of this Plan; provided however, that any cancelled Options will be
counted against the maximum number of shares with respect to which Options may
be granted to any particular person as set forth in Section 5.1(a) hereof.

5.             
TERMS AND CONDITIONS OF OPTIONS

5.1           
Each Option granted under this Plan shall be evidenced by a written agreement
approved by the Plan Administrator (each, an "Agreement"). Agreements may
contain such provisions, not inconsistent with this Plan or any Applicable Laws,
as the Plan Administrator in its discretion may deem advisable. All Options also
shall comply with the following requirements:

(a)           
Number of Shares and Type of Option

Each Agreement shall state the number of Common Shares to which
it pertains and whether the Option is intended to be an Incentive Stock Option
or a Non-Qualified Stock Option; provided that:

(i)           
the number of Common Shares that may be reserved pursuant to the exercise of
Options granted to any person shall not exceed 5% of the issued and outstanding
Common Shares of the Corporation;

(ii)           
in the absence of action to the contrary by the Plan Administrator in connection
with the grant of an Option, all Options shall be Non-Qualified Stock Options;

(iii)           
the aggregate fair market value (determined at the Date of Grant, as defined
below) of the Common Shares with respect to which Incentive Stock Options are
exercisable for the first time by the Optionee during any calendar year (granted
under this

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Plan and all other Incentive Stock
Option plans of the Corporation, a Related Corporation or a predecessor
corporation) shall not exceed U.S.$100,000, or such other limit as may be
prescribed by the Code as it may be amended from time to time (the "Annual
Limit"); and

(iv)           
any portion of an Option which exceeds the Annual Limit shall not be void but
rather shall be a Non-Qualified Stock Option.

(b)           
Date of Grant

Each Agreement shall state the date the Plan Administrator has
deemed to be the effective date of the Option for purposes of this Plan (the
"Date of Grant").

(c)           
Option Price

Each Agreement shall state the price per Common Share at which
it is exercisable. The Plan Administrator shall act in good faith to establish
the exercise price in accordance with Applicable Laws; provided that:

(i)           
the per share exercise price for an Incentive Stock Option or any Option granted
to a "covered employee" as such term is defined for purposes of Section 162(m)
of the Code shall not be less than the fair market value per Common Share at the
Date of Grant as determined by the Plan Administrator in good faith;

(ii)           
with respect to Incentive Stock Options granted to greater-than-ten percent
(>10%) shareholders of the Corporation (as determined with reference to
Section 424(d) of the Code), the exercise price per share shall not be less than
one hundred ten percent (110%) of the fair market value per Common Share at the
Date of Grant as determined by the Plan Administrator in good faith; and

(iii)           
Options granted in substitution for outstanding options of another corporation
in connection with the merger, consolidation, acquisition of property or stock
or other reorganization involving such other corporation and the Corporation or
any subsidiary of the Corporation may be granted with an exercise price equal to
the exercise price for the substituted option of the other corporation, subject
to any adjustment consistent with the terms of the transaction pursuant to which
the substitution is to occur, and provided that for Incentive Stock Options:

A.           
the excess of the aggregate fair market value of the shares subject to the
option immediately after the substitution over the aggregate exercise price of
such shares is not more than the excess of the aggregate fair market value of
all shares subject to the option immediately before such substitution over the
aggregate exercise price of such shares, and

B.           
the substituted option does not give the employee additional benefits which he
did not have under the previously held Option; and

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(iv)           
with respect to Non-Qualified Stock Options, the exercise price per share shall
be the fair market value of the Common Shares as determined by the Plan
Administrator in good faith.

(d)           
Duration of Options

At the time of the grant of the Option, the Plan Administrator
shall designate, subject to Section 5.1(g) below, the expiration date of the
Option, which date shall not be later than ten (10) years from the Date of
Grant; provided, that the expiration date of any Incentive Stock Option
granted to a greater-than-ten percent (>10%) shareholder of the Corporation
(as determined with reference to Section 424(d) of the Code) shall not be later
than five (5) years from the Date of Grant. In the absence of action to the
contrary by the Plan Administrator in connection with the grant of a particular
Option, and except in the case of Incentive Stock Options as described above,
all Options granted under this Section 5 shall expire ten (10) years from the
Date of Grant.

(e)           
Vesting Schedule

No Option shall be exercisable until it has vested. Subject to
Section 5.1(f) hereof, the vesting schedule for each Option shall be specified
by the Plan Administrator at the time of grant of the Option prior to the
provision of services with respect to which such Option is granted;
provided, that if no vesting schedule is specified at the time of grant,
the Option shall vest according to the following schedule:

Number of Years
    Percentage of TotalFollowing
      Date of Grant
    Option VestedOne
    25%Two
    50%Three
    75%Four
    100%


The Plan Administrator may specify a
vesting schedule for all or any portion of an Option based on the achievement of
performance objectives established in advance of the commencement by the
Optionee of services related to the achievement of the performance objectives.
Performance objectives shall be expressed in terms of objective criteria,
including but not limited to, one or more of the following: return on equity,
return on assets, share price, market share, sales, earnings per share, costs,
net earnings, net worth, inventories, cash and cash equivalents, gross margin or
the Corporation's performance relative to its internal business plan.
Performance objectives may be in respect of the performance of the Corporation
as a whole (whether on a consolidated or unconsolidated basis), a Related
Corporation, or a subdivision, operating unit, product or product line of either
of the foregoing.

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Performance objectives may be absolute
or relative and may be expressed in terms of a progression or a range. An Option
that is exercisable (in full or in part) upon the achievement of one or more
performance objectives may be exercised only following written notice to the
Optionee and the Corporation by the Plan Administrator that the performance
objective has been achieved.

(f)           
Acceleration of Vesting

Upon the occurrence of a Change of Control of the Corporation,
all unexpired and unvested Options shall immediately vest and shall be
exercisable for the acquisition of Common Shares. Notwithstanding any other
provision hereof, the vesting of one or more outstanding Options may be
accelerated by the Plan Administrator at such times and in such amounts as it
shall determine in its sole discretion.

For the purposes hereof the term "Change of Control" shall
mean, in respect of the Corporation, the occurrence of any of:

(i)           
the purchase or acquisition of Common Shares and/or securities convertible into
Common Shares or carrying the right to acquire Common Shares ("Convertible
Securities") as a result of which a person, group of persons or persons acting
jointly or in concert, or any Affiliates (as such term is defined in the
Business Corporations Act (British Columbia)) or Associates (as such term
is defined in the Securities Act (British Columbia)) of any such person,
group of persons or any of such persons acting jointly or in concert
(collectively, the "Subject Persons") beneficially own or exercise control or
direction over Common Shares and/or Convertible Securities such that, after the
conversion of the Convertible Securities beneficially owned by the Subject
Persons, the Subject Persons would have the right to cast more than 50% of the
votes attached to all Common Shares; provided that, the acquisition of
Common Shares or Convertible Securities pursuant to the issuance of securities
from treasury which results in a Subject Person, or Subject Persons,
beneficially owning or exercising control or direction over 50% of the votes
attached to all Common Shares (assuming the conversion of the Convertible
Securities beneficially owned by Subject Persons) where the Board continues to
be supportive of the direction of the Corporation under the management of the
Chief Executive Officer, shall not constitute a "Change of Control"; or

(ii)           
approval by the shareholders of:

A.           
an amalgamation, arrangement, merger or other consolidation or combination of
the Corporation with another entity pursuant to which the shareholders of the
Corporation immediately thereafter do not own securities of the successor or
continuing entity which would entitle them to cast more than 50% of the votes
attaching to all of the Common Shares;

B.           
a liquidation, dissolution or winding up of the Corporation;

C.           
the sale, lease or other disposition of all or substantially all of the assets
of the Corporation;

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D.           
the election at a meeting of the Corporations shareholders of a number of
directors, who were not included in the slate for election as directors approved
by the prior Board, and who would represent a majority of the Board; or

E.           
the appointment of a number of directors which would represent a majority of the
Board and which were nominated by any holder of voting shares of the Corporation
or by any group of holders of voting shares of the Corporation acting jointly or
in concert and not approved by the Corporations prior Board.

(g)           
Term of Option

(i)           
Vested Options shall terminate, to the extent not previously exercised, upon the
occurrence of the first of the following events:

A.           
the expiration of the Option, as designated by the Plan Administrator in
accordance with Section 5.1(d) above;

B.           
the date of an Optionee's termination of employment or contractual relationship
with the Corporation or any Related Corporation for cause (as determined by the
Plan Administrator, acting reasonably);

C.           
the date of an Optionee's resignation or termination of employment or
contractual relationship with the Corporation or any Related Corporation for any
reason whatsoever other than cause, death or Disability (as defined below); or

D.           
the expiration of one year (1) from termination of an Optionee's employment or
contractual relationship by reason of death or Disability (as defined below)
unless, in the case of a Non-Qualified Stock Option, the exercise period is
extended by the Plan Administrator until a date not later than the expiration
date of the Option.

(ii)           
Notwithstanding Section 5.1(g)(i) above, any vested Options which have been
granted to the Optionee in the Optionee's capacity as a director of the
Corporation or any Related Corporation shall terminate upon the occurrence of
the first of the following events:

A.           
the event specified in Section 5.1(g)(i)A above;

B.           
the event specified in Section 5.1(g)(i)D above; and

C.           
the date the Optionee ceases to serve as a director of the Corporation or
Related Corporation, as the case may be unless, in the case of a Non-Qualified
Stock Option, the exercise period is extended by the Plan Administrator until a
date not later than the expiration date of the Option.

(iii)           
Upon the death of an Optionee, any vested Options held by the Optionee shall be
exercisable only by the person or persons to whom such Optionee's rights under
such Option shall pass by the Optionee's will or by the laws of descent and
distribution of the

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Optionee's domicile at the time of
death and only until such Options terminate as provided above.

(iv)           
For purposes of the Plan, unless otherwise defined in the Agreement,
"Disability" shall mean medically determinable physical or mental impairment
which has lasted or can be expected to last for a continuous period of not less
than twelve (12) months or that can be expected to result in death. The Plan
Administrator shall determine whether an Optionee has incurred a Disability on
the basis of medical evidence acceptable to the Plan Administrator. Upon making
a determination of Disability, the Plan Administrator shall, for purposes of the
Plan, determine the date of an Optionee's termination of employment or
contractual relationship.

(v)           
Unless accelerated in accordance with Section 5.1(f) above, unvested Options
shall terminate immediately upon termination of employment of the Optionee by
the Corporation for any reason whatsoever, including death or Disability.

(vi)           
For purposes of this Plan, transfer of employment between or among the
Corporation and/or any Related Corporation shall not be deemed to constitute a
termination of employment with the Corporation or any Related Corporation.
Employment shall be deemed to continue while the Optionee is on military leave,
sick leave or other bona fide leave of absence (as determined by the Plan
Administrator). The foregoing notwithstanding, employment shall not be deemed to
continue beyond the first ninety (90) days of such leave, unless the Optionee's
re-employment rights are guaranteed by statute or by contract.

(h)           
Exercise of Options

(i)           
Options shall be exercisable, in full or in part, at any time after vesting,
until termination. If less than all of the Common Shares included in the vested
portion of any Option are purchased, the remainder may be purchased at any
subsequent time prior to the expiration of the Option term. Only whole Common
Shares may be issued pursuant to an Option, and to the extent that an Option
covers less than one (1) share, it is unexercisable.

(ii)           
Options or portions thereof may be exercised by giving written notice to the
Corporation, which notice shall specify the number of Common Shares to be
purchased, and be accompanied by payment in the amount of the aggregate exercise
price for the Common Shares so purchased, which payment shall be in the form
specified in Section 5.1(i) below. The Corporation shall not be obligated to
issue, transfer or deliver a certificate representing Common Shares to the
Holder of any Option, until provision has been made by the Holder, to the
satisfaction of the Corporation, for the payment of the aggregate exercise price
for all Common Shares for which the Option shall have been exercised and for
satisfaction of any tax withholding obligations associated with such exercise.
During the lifetime of an Optionee, Options are exercisable only by the
Optionee.

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(i)           
Payment upon Exercise of Option

Upon the exercise of any Option, the aggregate exercise price
shall be paid to the Corporation in cash or by certified or cashier's check. In
addition, if pre-approved in writing by the Plan Administrator who may
arbitrarily withhold consent, the Holder may pay for all or any portion of the
aggregate exercise price by complying with one or more of the following
alternatives:

(i)           
by delivering a properly executed exercise notice together with irrevocable
instructions to a broker promptly to sell or margin a sufficient portion of the
Common Shares and deliver directly to the Corporation the amount of sale or
margin loan proceeds to pay the exercise price; or

(ii)           
by complying with any other payment mechanism approved by the Plan Administrator
at the time of exercise.

(j)           
No Rights as a Shareholder

A Holder shall have no rights as a shareholder of the
Corporation with respect to any Common Shares covered by an Option until such
Holder becomes a record holder of such Common Shares, irrespective of whether
such Holder has given notice of exercise. Subject to the provisions of Section
5.1(m) hereof, no rights shall accrue to a Holder and no adjustments shall be
made on account of dividends (ordinary or extraordinary, whether in cash,
securities or other property) or distributions or other rights declared on, or
created in, the Common Shares for which the record date is prior to the date the
Holder becomes a record holder of the Common Shares covered by the Option,
irrespective of whether such Holder has given notice of exercise.

(k)           
Non-transferability of Options

(i)           
Options granted under this Plan and the rights and privileges conferred by this
Plan may not be transferred, assigned, pledged or hypothecated in any manner
(whether by operation of law or otherwise) other than by will or by applicable
laws of descent and distribution or, in the case of a Non-Qualified Stock
Option, pursuant to a qualified domestic relations order, and shall not be
subject to execution, attachment or similar process; provided however that,
subject to applicable laws:

A.           
for Non-Qualified Stock Options, any Agreement may provide or be amended to
provide that a Non-Qualified Stock Option to which it relates is transferable
without payment of consideration to immediate family members of the Optionee or
to trusts or partnerships or limited liability companies established exclusively
for the benefit of the Optionee and the Optionee's immediate family members;

B.                      
for all Options, the Optionee's heirs or administrators may exercise any portion
of the outstanding Options within one year of the Optionee's death.

(ii) Upon any attempt to transfer,
assign, pledge, hypothecate or otherwise dispose of any Option or of any right
or privilege conferred by this Plan contrary to the provisions hereof, or upon
the sale, levy or any attachment or similar process upon the rights and

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privileges conferred by this Plan, such
Option shall thereupon terminate and become null and void.

(l)           
Securities Regulation and Tax Withholding

(i)           
Common Shares shall not be issued with respect to an Option unless the exercise
of such Option and the issuance and delivery of such Common Shares shall comply
with all Applicable Laws, and such issuance shall be further subject to the
approval of counsel for the Corporation with respect to such compliance,
including the availability of an exemption from prospectus and registration
requirements for the issuance and sale of such Common Shares. The inability of
the Corporation to obtain from any regulatory body the authority deemed by the
Corporation to be necessary for the lawful issuance and sale of any Common
Shares under this Plan, or the unavailability of an exemption from prospectus
and registration requirements for the issuance and sale of any Common Shares
under this Plan, shall relieve the Corporation of any liability with respect to
the non-issuance or sale of such Common Shares.

(ii)           
As a condition to the exercise of an Option, the Plan Administrator may require
the Holder to represent and warrant in writing at the time of such exercise that
the Common Shares are being purchased only for investment and without any
then-present intention to sell or distribute such Common Shares. If necessary
under Applicable Laws, the Plan Administrator may cause a stop-transfer order
against such Common Shares to be placed on the stock books and records of the
Corporation, and a legend indicating that the Common Shares may not be pledged,
sold or otherwise transferred unless an opinion of counsel is provided stating
that such transfer is not in violation of any Applicable Laws, may be stamped on
the certificates representing such Common Shares in order to assure an exemption
from registration. The Plan Administrator also may require such other
documentation as may from time to time be necessary to comply with applicable
securities laws. THE CORPORATION HAS NO OBLIGATION TO UNDERTAKE REGISTRATION OF
OPTIONS OR THE COMMON SHARES ISSUABLE UPON THE EXERCISE OF OPTIONS.

(iii)           
The Holder shall pay to the Corporation by certified or cashier's check,
promptly upon exercise of an Option or, if later, the date that the amount of
such obligations becomes determinable, all applicable federal, state, local and
foreign withholding taxes that the Plan Administrator, in its discretion,
determines to result upon exercise of an Option or from a transfer or other
disposition of Common Shares acquired upon exercise of an Option or otherwise
related to an Option or Common Shares acquired in connection with an Option.
Upon approval of the Plan Administrator, a Holder may satisfy such obligation by
complying with one or more of the following alternatives selected by the Plan
Administrator:

A.           
by delivering to the Corporation Common Shares previously held by such Holder or
by the Corporation withholding Common Shares otherwise deliverable pursuant to
the exercise of the Option, which Common Shares received or withheld shall have
a fair market value at the date of exercise (as determined by

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the Plan Administrator) equal to any
withholding tax obligations arising as a result of such exercise, transfer or
other disposition; or

B.           
by complying with any other payment mechanism approved by the Plan Administrator
from time to time.

(iv)           
The issuance, transfer or delivery of certificates representing Common Shares
pursuant to the exercise of Options may be delayed, at the discretion of the
Plan Administrator, until the Plan Administrator is satisfied that the
applicable requirements of all Applicable Laws and the withholding provisions of
the Code have been met and that the Holder has paid or otherwise satisfied any
withholding tax obligation as described in Section 5.1(l)(iii) above.

(m)           
Adjustments Upon Changes In Capitalization

(i)           
The aggregate number and class of shares for which Options may be granted under
this Plan, the number and class of shares covered by each outstanding Option,
and the exercise price per share thereof (but not the total price), and each
such Option, shall all be proportionately adjusted for any increase or decrease
in the number of issued Common Shares of the Corporation resulting from:

A.           
a subdivision or consolidation of Common Shares or any like capital adjustment,
or

B.           
the issuance of any Common Shares, or securities exchangeable for or convertible
into Common Shares, to the holders of all or substantially all of the
outstanding Common Shares by way of a stock dividend (other than the issue of
Common Shares, or securities exchangeable for or convertible into Common Shares,
to holders of Common Shares pursuant to their exercise of options to receive
dividends in the form of Common Shares, or securities convertible into Common
Shares, in lieu of dividends paid in the ordinary course on the Common Shares).

(ii)           
Except as provided in Section 5.1(m)(iii) hereof, upon a merger (other than a
merger of the Corporation in which the holders of Common Shares immediately
prior to the merger have the same proportionate ownership of common shares in
the surviving corporation immediately after the merger), consolidation,
acquisition of property or stock, separation, reorganization (other than a mere
re-incorporation or the creation of a holding Corporation) or liquidation of the
Corporation, as a result of which the shareholders of the Corporation, receive
cash, shares or other property in exchange for or in connection with their
Common Shares, any Option granted hereunder shall terminate, but the Holder
shall have the right to exercise such Holder's Option immediately prior to any
such merger, consolidation, acquisition of property or shares, separation,
reorganization or liquidation, and to be treated as a shareholder of record for
the purposes thereof, to the extent the vesting requirements set forth in the
Option agreement have been satisfied (or accelerated pursuant to Section 5.1(f)
hereof).

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(iii)           
If the shareholders of the Corporation receive shares in the capital of another
corporation ("Exchange Shares") in exchange for their Common Shares in any
transaction involving a merger (other than a merger of the Corporation in which
the holders of Common Shares immediately prior to the merger have the same
proportionate ownership of Common Shares in the surviving corporation
immediately after the merger), consolidation, acquisition of property or shares,
separation or reorganization (other than a mere re-incorporation or the creation
of a holding Corporation), all Options granted hereunder shall be converted into
options to purchase Exchange Shares unless the Corporation and the corporation
issuing the Exchange Shares, in their sole discretion, determine that any or all
such Options granted hereunder shall not be converted into options to purchase
Exchange Shares but instead shall terminate in accordance with, and subject to
the Holder's right to exercise the Holder's Options pursuant to, the provisions
of Section 5.1(m)(ii) . The amount and price of converted options shall be
determined by adjusting the amount and price of the Options granted hereunder in
the same proportion as used for determining the number of Exchange Shares the
holders of the Common Shares receive in such merger, consolidation, acquisition
or property or stock, separation or reorganization. Unless accelerated by the
Board, the vesting schedule set forth in the option agreement shall continue to
apply to the options granted for the Exchange Shares.

(iv)           
In the event of any adjustment in the number of Common Shares covered by any
Option, any fractional shares resulting from such adjustment shall be
disregarded and each such Option shall cover only the number of full shares
resulting from such adjustment.

(v)           
All adjustments pursuant to Section 5.1(m) shall be made by the Plan
Administrator, and its determination as to what adjustments shall be made, and
the extent thereof, shall be final, binding and conclusive.

(vi)           
The grant of an Option shall not affect in any way the right or power of the
Corporation to make adjustments, reclassifications, reorganizations or changes
of its capital or business structure, to merge, consolidate or dissolve, to
liquidate or to sell or transfer all or any part of its business or assets.

6.             
EFFECTIVE DATE; AMENDMENT; SHAREHOLDER APPROVAL

6.1           
Options may be granted by the Plan Administrator from time to time on or after
the date on which this Plan is adopted by the Board (the "Effective Date").

6.2           
Unless sooner terminated by the Board, this Plan shall terminate on the tenth
anniversary of the Effective Date. No Option may be granted after such
termination or during any suspension of this Plan.

6.3           
Any Incentive Stock Options granted by the Plan Administrator prior to the
ratification of this Plan by the shareholders of the Corporation shall be
granted subject to approval of this Plan by the holders of a majority of the
Corporation's outstanding voting shares, voting either in person or by proxy at
a duly held shareholders' meeting within twelve (12) months before or after the
Effective Date. If such shareholder approval is sought and not obtained, all
Incentive

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Stock Options granted prior thereto and thereafter shall be
considered Non-Qualified Stock Options and any Options granted to Covered
Employees will not be eligible for the exclusion set forth in Section 162(m) of
the Code with respect to the deductibility by the Corporation of certain
compensation.

7.             
NO OBLIGATIONS TO EXERCISE OPTION

7.1           
The grant of an Option shall impose no obligation upon the Optionee to exercise
such Option.

8.             
NO RIGHT TO OPTIONS OR TO EMPLOYMENT

8.1           
Whether or not any Options are to be granted under this Plan shall be
exclusively within the discretion of the Plan Administrator, and nothing
contained in this Plan shall be construed as giving any person any right to
participate under this Plan. The grant of an Option shall in no way constitute
any form of agreement or understanding binding on the Corporation or any Related
Corporation, express or implied, that the Corporation or any Related Corporation
will employ or contract with an Optionee for any length of time, nor shall it
interfere in any way with the Corporation's or, where applicable, a Related
Corporation's right to terminate Optionee's employment at any time, which right
is hereby reserved.

9.             
APPLICATION OF FUNDS

9.1           
The proceeds received by the Corporation from the sale of Common Shares issued
upon the exercise of Options shall be used for general corporate purposes,
unless otherwise directed by the Board.

10.           
INDEMNIFICATION OF PLAN ADMINISTRATOR

10.1          In
addition to all other rights of indemnification they may have as members of the
Board, members of the Plan Administrator shall be indemnified by the Corporation
for all reasonable expenses and liabilities of any type or nature, including
attorneys' fees, incurred in connection with any action, suit or proceeding to
which they or any of them are a party by reason of, or in connection with, this
Plan or any Option granted under this Plan, and against all amounts paid by them
in settlement thereof (provided that such settlement is approved by independent
legal counsel selected by the Corporation), except to the extent that such
expenses relate to matters for which it is adjudged that such Plan Administrator
member is liable for willful misconduct; provided, that within fifteen (15) days
after the institution of any such action, suit or proceeding, the Plan
Administrator member involved therein shall, in writing, notify the Corporation
of such action, suit or proceeding, so that the Corporation may have the
opportunity to make appropriate arrangements to prosecute or defend the same.

11.           
AMENDMENT OF PLAN

11.1          The
Plan Administrator may, at any time, modify, amend or terminate this Plan or
modify or amend Options granted under this Plan, including, without limitation,
such modifications or amendments as are necessary to maintain compliance with
the Applicable Laws. The Plan Administrator may condition the effectiveness of
any such amendment on the receipt of

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shareholder approval at such time and in such manner as the
Plan Administrator may consider necessary for the Corporation to comply with or
to avail the Corporation and/or the Optionees of the benefits of any securities,
tax, market listing or other administrative or regulatory requirements.

Effective Date: January 5, 2007

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