MOSQUITO
      CONSOLIDATED GOLD MINES LIMITED

     

    INCENTIVE
      SHARE OPTION PLAN

     

    Section
      1. General
      Provisions

     

    
      	
              1.1

            	
              Interpretation

            


    

     

    For
      the
      purposes of this Plan, the following terms shall have the following
      meanings:

     

    “Board”
      means the Board of Directors of the Company;

     

    “Common
      Shares” means the Common Shares without par value of the Company as currently
      constituted;

     

    “Company”
      means Mosquito
      Consolidated Gold Mines Limited;

     

    “Consultant”
      means an individual (including an individual whose services are contracted
      through a personal holding corporation) with whom the Company or a subsidiary
      has a contract for substantial services and who falls within the definition
      of
      an “employee” under the rules and policies of the TSX Venture Exchange and the
      B.C. Securities Commission;

     

    “Eligible
      Person” means, subject to all applicable laws, any director, officer, employee,
      part-time employee, Consultant or person engaged in investor relations
      activities on behalf of the Company or any of its Subsidiary
      Companies;

     

    “Insider”
      means an insider as defined under the Securities
      Act (British
      Columbia);

     

    “Option”
      means an option to purchase Common Shares granted to an Eligible Persons
      pursuant to the terms of the Plan;

     

    “Participant”
      means Eligible Persons to whom Options have been granted;

     

    “Plan”
      means this Incentive Share Option Plan; 

     

    “Subsidiary
      Companies” have the meanings ascribed to those terms under the Company
      Act (British
      Columbia); and

     

    “Termination
      Date” means the date on which a Participant ceases to be an Eligible
      Person.

     

    Words
      importing the singular number only shall include the plural and vice versa
      and
      words importing the masculine shall include the feminine.

     

    This
      Plan
      and all matters to which reference is made herein shall be governed by and
      interpreted in accordance with the laws of the Province of British Columbia
      and
      the laws of Canada applicable therein.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
      	
              1.2

            	
              Purpose

            


    

     

    The
      purpose of the Plan is to advance the interests of the Company by (i) providing
      Eligible Persons with additional incentive, (ii) encouraging stock ownership
      by
      such Eligible Persons, (iii) increasing the proprietary interest of Eligible
      Persons in the success of the Company, and (iv) encouraging the Eligible Person
      to remain with the Company or its Subsidiary companies.

     

    
      	
              1.3

            	
              Administration

            


    

     

    
      	 	
              (a)

            	
              This
                Plan shall be administered by the Board or a committee of the Board
                duly
                appointed for this purpose by the Board and consisting of not less
                than 3
                directors. If a committee is appointed for this purpose, all references
                to
                the Board will be deemed to be references to the
                committee.

            


    

     

    
      	 	
              (b)

            	
              Subject
                to the limitations of the Plan, the Board shall have the
                authority

            


    

     

    
      	 	
              (i)

            	
              to
                grant options to purchase Common Shares to Eligible
                Persons;

            


    

     

    
      	 	
              (ii)

            	
              to
                determine the terms, limitations, restrictions and conditions respecting
                such grants;

            


    

     

    
      	 	
              (iii)

            	
              to
                interpret the Plan and to adopt, amend and rescind such administrative
                guidelines and any other rules and regulations relating to the Plan
                as it
                shall from time to time deem advisable;


            


    

     

    
      	 	
              (iv)

            	
              to
                make all other determinations and to take all other actions in connection
                with the implementation and administration of the Plan including,
                without
                limitation, for the purpose of ensuring compliance with Section 1.8
                hereof, as it may deem necessary or advisable. The Board's guidelines,
                rules, regulations, interpretations and determinations shall be conclusive
                and binding upon the Company and all other
                persons.

            


    

     

    
      	
              1.4

            	
              Shares
                Reserved

            


    

     

    
      	 	
              (a)

            	
              The
                maximum number of Common Shares which may be reserved for issuance
                shall
                be ten percent (10%) of the issued and outstanding Common Shares.
                Further,
                provided that disinterested shareholder approval has been obtained,
                it
                shall be permissible under the Plan to issue a number of shares to
                insiders upon the exercise of stock options, within a one-year period
                that
                exceeds 10% of the outstanding listed shares (the “Additional
                Options”)
                (provided that the number of outstanding options at any time does
                not
                exceed 10% of the issued shares).
                

            


    

     

    
      	 	
              (b)

            	
              If
                there is a change in the outstanding Common Shares by reason of any
                stock
                dividend or any recapitalization, amalgamation, subdivision,
                consolidation, combination or exchange of shares, or other corporate
                change, the Board shall make, subject to the prior approval of the
                relevant stock exchanges, appropriate substitution or adjustment
                in:

            


    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
      	 	
              (i)

            	
              the
                number or kind of shares or other securities reserved for issuance
                pursuant to the Plan, and

            


    

     

    
      	 	
              (ii)

            	
              the
                number and kind of shares subject to unexercised Options theretofore
                granted and in the options price of such
                shares;

            


    

     

    provided,
      however, that no substitution or adjustment shall obligate the Company to issue
      or sell fractional shares. If the Company is reorganized, amalgamated with
      another corporation or consolidated, the Board shall make such provisions for
      the protection of the rights of Participants as the Board in its discretion
      deems appropriate.

     

    
      	
              1.5

            	
              Limits
                with Respect to Insiders

            


    

     

    
      	 	
              (a)

            	
              The
                maximum number of Common Shares which may be reserved for issuance
                to
                Insiders under the Plan shall be ten (10%) of the Common Shares issued
                and
                outstanding at the time of the grant (on a non-diluted basis) less
                the
                aggregate number of Common Shares reserved for issuance to Insiders
                under
                any other share compensation
                arrangement.

            


    

     

    
      	 	
              (b)

            	
              Disinterested
                shareholder approval shall be obtained for any reduction in the exercise
                price of the Option, where the Eligible Person is an Insider of the
                Company.

            


    

     

    
      	
              1.6

            	
              Amendment
                and Termination

            


    

     

    
      	 	
              (a)

            	
              The
                Board may amend, suspend or terminate the Plan or any portion thereof
                at
                any time in accordance with applicable legislation, and subject to
                shareholder and regulatory approval. No such amendment, suspension
                or
                termination shall alter or impair any Options or any rights pursuant
                thereto granted previously to any Participant without the consent
                of any
                such Participant. If the Plan is terminated, the provisions of the
                Plan
                and any administrative guidelines, and other rules and regulations
                adopted
                by the Board and in force at the time of the Plan shall continue
                in effect
                during such time as an Option or any rights pursuant thereto remain
                outstanding.

            


    

     

    
      	 	
              (b)

            	
              With
                the consent of the affected Participants, the Board may amend or
                modify
                any outstanding Option in any manner to the extent that the Board
                would
                have had the authority to initially grant such award as so modified
                or
                amended, including without limitation, to change the date or dates
                as of
                which an Option becomes exercisable, subject to the prior approval
                of the
                relevant stock exchanges.

            


    

     

    
      	
              1.7

            	
              Compliance
                with Legislation

            


    

     

    The
      Plan,
      the grant and exercise of Options hereunder and the Company's obligation to
      sell
      and deliver Common Shares upon exercise of Options shall be subject to all
      applicable federal, provincial and foreign laws, rules and regulations, the
      rules and regulations, of any stock exchange on which the Common Shares are
      listed for trading and to such approvals by any regulatory or governmental
      agency as may, in the opinion of counsel to the Company, be required. The
      Company shall not be obliged by any provision of the Plan or the grant of any
      Option hereunder to issue or sell Common Shares in violation of such laws,
      rules
      and regulations or any condition of such approvals. No Option shall be granted
      and no Common Shares issued or sold hereunder where such grant, issue or sale
      would require registration of the Plan or of Common Shares under the securities
      laws of any foreign jurisdiction and any purported grant of any Option or issue
      or sale of Common Shares hereunder in violation of this provision shall be
      void.
      Common Shares issued and sold to Participants pursuant to the exercise of
      Options may be subject to limitations on sale or resale under applicable
      securities laws. In particular, if Options are granted to any resident or
      citizen of the United States, the Board and the Company will use their best
      efforts to ensure that all matters pertaining to such Options shall be made
      in
      compliance with applicable United States securities laws.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
      	
              1.8

            	
              Effective
                Date

            


    

     

    The
      Plan
      shall be effective upon the approval of the Plan by the TSX Venture
      Exchange.

     

    
      	
              1.9

            	
              Miscellaneous

            


    

     

    
      	 	
              (a)

            	
              Nothing
                contained herein shall prevent the Board from adopting other or additional
                compensation arrangements, subject to any required
                approval.

            


    

     

    
      	 	
              (b)

            	
              Nothing
                contained in the Plan nor in any Option granted thereunder shall
                be deemed
                to give any Participant any interest or title in or to any Common
                Shares
                of the Company or any rights as a shareholder of the Company or any
                other
                legal or equitable right against the Company whatsoever other than
                as set
                forth in the Plan and pursuant to the exercise of any
                Option.

            


    

     

    
      	 	
              (c)

            	
              The
                Plan does not give any Participant or any employee of the Company
                or any
                of its subsidiary companies the right or obligation to or to continue
                to
                serve as a director, officer or employee, as the case may be, of
                the
                Company or any of its subsidiary companies. The awarding of Options
                to any
                Eligible Person is a matter to be determined solely in the discretion
                of
                the Board. The Plan shall not in any way fetter, limit, obligate,
                restrict
                or constrain the Board with regard to the allotment or issue of any
                Common
                Shares or any other securities in the capital of the Company or any
                of its
                subsidiaries other than as specifically provided for in the
                Plan.

            


    

     

    
      	 	
              (d)

            	
              No
                fractional Common Shares shall be issued upon the exercise of options
                granted under the Plan and, accordingly, if a Participant would become
                entitled to a fractional Common Share upon the exercise of an Option,
                such
                Participant shall only have the right to purchase the next lowest
                whole
                number of Common Shares and no payment or other adjustment will be
                made
                with respect to the fractional interest so
                disregarded.

            


    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    Section
      2. Options

     

    
      	
              2.1

            	
              Grants

            


    

     

    Subject
      to the provisions of the Plan, the Board shall have the authority to determine
      the limitations, restrictions and conditions, if any, in addition to those
      set
      forth in Section 2.3 hereof, applicable to the exercise of an Option, including,
      without limitation, the nature and duration of the restrictions, if any, to
      be
      imposed upon the exercise of the Options or the sale or other disposition of
      Common Shares acquired upon exercise of the Option, and the nature of the
      events, if any, and the duration of the period in which any Participant's rights
      in respect of Common Shares acquired upon exercise of an Option may be
      forfeited, with the discretion in the Board to modify or rescind such
      restrictions in the event of certain corporate developments such as a take
      over
      bid, reorganization, merger, change in capital or amalgamation. An Eligible
      Person may receive Options on more than one occasion under the Plan and may
      receive separate Options on any one occasion; however, no more than 5% of the
      issued shares of the Company may be issued to any Eligible Person excluding
      a
      Consultant in any 12-month period. No more than 2% of the issued shares of
      the
      Company may be issued to any one Consultant in any 12-month period. No more
      than
      2% of the issued shares of the Company may be issued to all Employees in
      aggregate conducting investor relations activities (as defined in the policies
      of the TSX Venture Exchange) in any 12 month period. Further any options granted
      to an optionee engaged in investor relations activities must expire within
      30
      days after the optionee ceases to be employed to provide investor relations
      services.

     

    
      	
              2.2

            	
              Option
                Price

            


    

     

    
      	 	
              (a)

            	
              The
                Board shall establish the option price at the time each Option is
                granted,
                which shall not be less than the Discounted Market Price as calculated
                and
                defined in accordance with the policies of the TSX Venture
                Exchange.

            


    

     

    
      	 	
              (b)

            	
              The
                option price shall be subject to adjustment in accordance with the
                provisions of Section 1.4(c)
                hereof.

            


    

     

    
      	
              2.3

            	
              Exercise
                of Options

            


    

     

    
      	 	
              (a)

            	
              Options
                granted must be exercised no later then five (5) years commencing
                from the
                later of the date of grant or such lesser period as may be determined
                by
                the Board.

            


    

     

    
      	 	
              (b)

            	
              In
                addition to any resale restrictions under any applicable laws, all
                Options
                are subject to a four (4) month hold period from the date the Options
                are
                granted to the Eligible Persons. 

            


    

     

    
      	 	
              (c)

            	
              The
                Board may determine when any Option will become exercisable and may
                determine that the Option shall be exercisable in
                installments.

            


    

     

    
      	 	
              (d)

            	
              Options
                granted to Employees or Consultants conducting investor relations
                activities must vest in stages over 12 months with no more than 1/4
                of the
                Options vesting in any three month
                period.

            


    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
      	 	
              (e)

            	
              Options
                granted under the Plan shall not be transferable or assignable, whether
                absolutely or by way of mortgage, pledge or other charge, by the
                Participant other than by will or by testamentary instrument or the
                laws
                of succession, and shall be exercisable during the lifetime of a
                Participant only by the Participant and after death only by the
                Participant's legal representative.

            


    

     

    
      	 	
              (f)

            	
              Except
                as otherwise determined by the
                Board:

            


    

     

    
      	 	
              (i)

            	
              if
                a Participant ceases to be an Eligible Person for any reason whatsoever
                other than death, each Option held by the Participant will cease
                to be
                exercisable 90 days after the Termination Date. If any portion of
                an
                Option is not vested by the Termination Date, that portion of the
                Option
                may not under any circumstances be exercised by the Participant.
                Without
                limitation, and for greater certainty only, this provision will apply
                regardless of whether the Participant was dismissed with or without
                cause
                and regardless of whether the Participant received compensation in
                respect
                of dismissal or as entitled to a period of notice or termination
                which
                would otherwise have permitted a greater portion of the Option to
                vest
                under the Plan with the Participant. Upon expiration of such 90 days
                period all unexercised option rights of that Participant shall immediately
                terminate and shall lapse notwithstanding the original term of the
                option
                granted to such Participant under the Plan;


            


    

     

    
      	 	
              (ii)

            	
              upon
                the death of a Participant, the legal representative of the Participant
                may exercise any outstanding portion of the Participant's Options
                within
                one year after the date of the Participant's
                death.

            


    

     

    
      	 	
              (g)

            	
              Each
                Option shall be confirmed by an option agreement executed by the
                Company
                and by the Participant.

            


    

     

    
      	 	
              (h)

            	
              The
                exercise price of each Common Share purchased under an Option shall
                be
                paid in full in cash or by bank draft or certified cheque at the
                time of
                such exercise, and upon receipt of payment in full, but subject to
                the
                terms of the Plan, the number of Common Shares in respect of which
                the
                Option is exercised shall be duly issued as fully paid and
                non-assessable.

            


    

     

    
      	
              2.4

            	
              Company’s
                Representation

            


    

     

    Options
      granted to employees, consultants or management company employees shall be
      accompanied by a Company representation that the Eligible Person is a bona
      fide
      employee, consultant or management company employee as the case may be of the
      Company or its Subsidiary companies.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
      	
              2.5

            	
              Shareholder
                Approval

            


    

     

    This
      Plan
      is subject to approval by the shareholders of the Company at its next general
      meeting of shareholders and until such approval is obtained Options granted
      pursuant to this Plan will not be exercisable. When adopted by the Company's
      shareholders this Plan will supersede and replace all previous stock option
      plans.

     

    This
      Plan
      dated for reference this 8th day
      of
June,
      2006.