Document:

EXHIBIT 10.7  

SKY PETROLEUM, INC. 

(the “Corporation”)  

Canadian Stock Option
Plan 

	1.  	Purpose  

        The
purpose of this stock option plan (the “Plan”) is to
provide an incentive, in the form of a proprietary interest in the Corporation, to
Canadian resident officers, directors, Consultants (as defined below) and employees of the
Corporation or its subsidiaries who are in a position to contribute materially to
the successful operation of the business of the Corporation, to increase their interest in
the Corporation’s welfare and to provide a means through which the Corporation can
attract and retain service providers of outstanding abilities. 

	2.  	Administration  

        The
Plan shall be administered by the board of directors (the
“Board”) of the Corporation or a compensation committee of
the Board if so authorized by the Board. The Board may from time to time make grants of
options (“Options”) to acquire common shares
(“Common Shares”) in the capital of the Corporation,
subject to the terms of the Plan, to such eligible persons and with respect to such number
of Common Shares as the Board, in its sole discretion, may determine. 

        Subject
to the provisions of the Plan, the Board shall be authorized to interpret the Plan and the
grants made under the Plan, to establish, amend and rescind any rules and regulations
relating to the Plan and to make all other determinations necessary or advisable for the
administration of the Plan. The Board may correct any defect, supply any omission and
reconcile any inconsistency in the Plan or in any Option in the manner and to the extent
it shall be deemed desirable to carry it into effect. The determinations of the Board in
the administration of the Plan, as described herein, shall be final and conclusive. 

	3.  	Shares
Subject to the Plan  

        Subject
to section 10 hereof, the maximum number of Common Shares with respect to which Options
may be granted from time to time pursuant to the Plan (“Optioned
Shares”) shall not exceed 10.00% or such greater number as determined
by the Board, and approved, if required, by the shareholders of the Corporation and by any
relevant stock exchange, not exceeding the maximum number of shares permitted under the
rules of any stock exchange or other regulatory body having jurisdiction of the number of
Common Shares outstanding including for the purposes of this section only, those Common
Shares issuable upon the exercise of any warrants of the Corporation outstanding from time
to time and the aggregate number of Optioned Shares so reserved for issuance to any one
person must not exceed 5.00% of the Common Shares outstanding. Common Shares in respect of
which options are not exercised shall be available for the granting of subsequent options. 

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	4. 	Eligibility  

        Officers,
directors and employees of the Corporation or its subsidiaries and Consultants (defined as
an individual or a company wholly-owned by individuals who provide ongoing consulting
services to the Corporation or an affiliate of the Corporation under a written contract;
possess technical, business or management expertise of value to the Corporation or an
affiliate of the Corporation; spend a significant amount of time and attention on the
business and affairs of the Corporation or an affiliate of the Corporation; and have a
relationship with the Corporation or an affiliate of the Corporation that enables the
individual to be knowledgeable about the business and affairs of the Corporation) shall be
eligible to be selected for grants of Options under the Plan, any such officer, director,
employee or Consultant so selected and granted Options being referred to as a
“Participant” for the purposes of the Plan. No officer,
director or employee of the Corporation or its subsidiaries and no Consultant shall be
entitled, as a matter of right, to receive Options under the Plan merely by virtue of such
officer’s, director’s, employee’s or Consultant’s position with the
Corporation or any of its subsidiaries. Nothing contained in the Plan, or in any Option
granted pursuant to the Plan, shall as such confer on any Participant the right to
continue as an officer, director, employee or Consultant of the Corporation or of or any
of its subsidiaries. Neither absence nor leave, if approved by the Corporation, nor any
transfer of employment between the Corporation and its subsidiaries shall be considered an
interruption or termination of the employment of a Participant for any purpose of the
Plan. 

	5.  	Granting
of Options  

        Except
as hereinafter provided, Options granted pursuant to the Plan shall be subject to the
following terms and conditions: 

	  	(a) 	  	Price 

	  	  	(i)  	  	The
exercise price per Common Share of each Option shall be not less than the
                    fair market value of the Common Shares on the trading day immediately
preceding                     the date on which the Option is granted.  

	  	  	(ii)  	  	The
fair market value shall be the closing price (the “Closing
                    Price”) of the Common Shares on the OTC Bulletin
Board or                     such other exchange upon which the Common Shares may be
listed and posted for                     trading (the “Exchange”)
on the trading day                     immediately preceding the date (the “Date
of                     Grant”) on which the Option is granted or, if
there is no                     sale on such date, then the Closing Price on the Exchange
on the last previous                     day on which a sale is reported. If at the Date
of Grant the Common Shares are                     not traded on a published exchange,
then the fair market value shall be the                     price determined by the
Board, in its sole discretion.  

	  	(b) 	  	Terms
of Options 

	  	  	(i)  	  	The
term during which, and the date or dates when, each Option may be exercised
                    shall be determined by the Board, but in no event shall an  

Page 3 of 6 

	  	
Option
be exercisable in whole or in part more than 7 years from the Date of Grant subject to
the rules and any stock exchange or regulatory body having jurisdiction. All rights to
purchase pursuant to an Option shall, unless sooner terminated, expire at the date
designated by the Board or upon the seventh anniversary of the Date of Grant, whichever
is sooner.  

	  	  	(ii)  	  	All
Options which remain unexercised upon termination or expiry shall revert to
                    the Plan and shall be included in the total number of Optioned Shares
available                     for issuance under the Plan. Optioned Shares may be
purchased in whole or in                     part at any time after such Optioned Shares
become purchasable. The Board may,                     in its sole discretion, accelerate
the time at which any Option may be exercised                     in whole or in part.  

	  	  	(iii)  	  	Each
Option shall, among other things, contain provisions to the effect that the
                    Option shall be personal to the Participant and shall not be
assignable,                     mortgaged, pledged, hypothecated or otherwise dealt with
in any manner                     whatsoever, other than to or with the Corporation.  

	  	(c) 	  	Vesting 

	  	
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. Unless otherwise
determined by the Board, one-third of the Option shall be exercisable on each of the
first, second and third anniversary dates of the Date of Grant. 

	  	(d) 	  	Ceasing
to be a Participant 

	  	  	(i)  	  	If
a Participant ceases to be a director, officer or employee of the Corporation
                    and its subsidiaries or ceases to be a Consultant for any reason
(excluding                     death, disability and termination of employment by the
Corporation or any                     subsidiary for cause), then such Participant may,
but only within a period of                     one year following such cessation (or
such later date as the Board may, in its                     discretion determine), and
in no event after the expiration date of such                     Participant’s
Option, exercise such Participant’s Option to the extent                     that
such Participant was entitled to exercise such Option at the date of such
                    cessation.  

	  	  	(ii)  	  	If
the employment of a Participant to whom an Option was granted is terminated
                    for cause, then all of the rights under any Option granted to such
Participant,                     whether or not vested, shall expire immediately upon the
giving to the                     Participant of notice of such termination, unless
otherwise determined by the                     Board.  

	  	  	(iii)  	  	In
the event of the death of a Participant, the Participant’s legal
                    representative may, but only to the extent such Participant was
entitled  

Page 4 of 6 

	  	
to
exercise such Option immediately prior to his death, exercise such Option at any time
within a period of one year immediately succeeding the date of death, but in no event
beyond the expiration of such Option. 

	  	  	(iv)  	  	If
a Participant ceases to be a director, officer or employee of the Corporation
                    and its subsidiaries or ceases to be a Consultant by reason of
disability, then                     such Participant may, but only within the period of
one year immediately                     succeeding such cessation and in no event after
the expiration date of such                     Option, exercise such Option to the
extent that such Participant was entitled to                     exercise such Option at
the date of such cessation.  

	  	  	(v)  	  	At
the time of grant, the Board may impose additional restrictions on the
                    exercise of an Option if the Participant ceases to be a director,
officer or                     employee of the Corporation and its subsidiaries or ceases
to be a Consultant.  

	6. 	Exercise
of Option 

        To
exercise an Option, the Participant shall give written notice to the Corporation in form
satisfactory to the Board, together with full payment of the exercise price. Payment shall
be made in either cash, certified cheque or bank draft. 

	7.  	Certificate
of Grant  

        Each
Participant shall receive a certificate of grant from the Corporation which shall contain
such provisions, consistent with the provisions of the Plan, as may be established from
time to time by the Board. 

	8.  	Transferability
or Assignability of Grants  

        No
grant of Options under the Plan shall be transferable or assignable by a Participant,
otherwise than by will or the laws of descent and distribution, during the lifetime of the
Participant and such grants may be exercised only by the Participant or the
Participant’s legal representative. 

	9.  	Listing
and Registration  

        Each
grant of Options shall be subject to the requirement that, if at any time the Board shall
determine in its discretion that the listing, registration or qualification of the Common
Shares subject to such grant upon any Exchange or under any provincial or federal law, or
the consent or approval of any governmental or regulatory body or the shareholders of the
Corporation, is necessary or desirable as a condition of, or in connection with, such
grant or the issue or purchase of Common Shares thereunder, then no such grant may be
exercised in whole or in part unless such listing, registration, qualification, consent or
approval shall have been effected and obtained free of any conditions not acceptable to
the Board. 

Page 5 of 6 

	10.  	Adjustment
of and Changes in Shares of the Corporation  

        In
the event of a reorganization, recapitalization, change of shares, share split, spin-off,
stock dividend, merger, arrangement, consolidation, rights offering, or reclassification,
subdivision or combination of shares, or any other changes in the corporate structure or
shares of the Corporation, the Board shall make such adjustments as it deems appropriate
in the number and kind of shares authorized by the Plan, in the number and kind of shares
covered by grants made under the Plan and in the purchase prices of outstanding Options. 

	11.  	Change
of Control  

        Regardless
of whether or not a vesting requirement is otherwise in place, all Options granted under
the Plan may be exercised, as to all or any of the Optioned Shares in respect of which
such Options have not previously been exercised, by the Participants immediately upon a
Change of Control, and the Corporation shall use its reasonable efforts to provide at
least 10 days’ advance notice of a Change of Control (to the extent that the
Corporation has received notice of such event) to any Participant holding an Option which
has not yet fully vested. A “Change of Control” means any
of the following events: 

	  	(a)  	  	the
acquisition of:  

	  	  	(i)  	  	shares
of the Corporation, and/or  

	  	  	(ii)  	  	securities
convertible into, exercisable for or carrying the right to purchase
                    shares of the Corporation (“Convertible Securities”),  

as a result of which a person, group
of persons or persons acting jointly or in concert, or persons associated or affiliated
within the meaning of the Nevada Business Corporations Act with any such person,
group of persons or any of such persons (collectively
“Acquirors”), beneficially own shares of the Corporation or
convertible securities such that, assuming only the conversion or exercise of Convertible
Securities beneficially owned by the Acquirors, the Acquirors would beneficially own
shares which would entitle them to cast more than 50% of the votes attaching to all shares
in the capital of the Corporation which may be cast to elect directors of the Corporation;
or 

	  	(b)  	  	approval
by the shareholders of the Corporation of and subsequent effectiveness
                    for:  

	  	  	(i)  	  	an
amalgamation, arrangement, merger or other consolidation of the Corporation
                    with another corporation pursuant to which the shareholders of the
Corporation                     immediately prior thereto do not immediately thereafter
own shares of the                     successor continuing corporation which entitle them
to cast more than 50% of the                     votes attaching to all shares in the
capital of the successor or continuing                     corporation which may be cast
to elect directors of that corporation,  

	  	  	(ii)  	  	a
liquidation, dissolution or winding-up of the Corporation, or  

Page 6 of 6 

	  	  	(iii)  	  	a
sale, lease or other disposition of all or substantially all of the assets of the
Corporation.  

	12.  	No
Rights of Shareholders  

        Neither the
Participant nor any personal representative shall be, or have any of the rights and
privileges of, a shareholder of the Corporation in respect of any Common Shares
purchasable upon the exercise of any Option in whole or in part, unless and until such
Option has been duly exercised. 

	13.  	Amendment
and Termination  

        The
Plan, subject to Exchange approval where required, may be amended by the Board as it shall
deem advisable to conform to any change in the law or regulation applicable thereto or in
any other respect which the Board may deem to be in the best interest of the Corporation;
provided, however, that the Board may not, without the authorization and approval of the
shareholders of the Corporation, increase the total number of securities which may be
issued under the Plan. 

        The
Board may, in its discretion, terminate, or fix a date for the termination of, the Plan.
No such termination shall affect any grants theretofore made which have neither expired
nor been terminated. Unless previously terminated, the Plan shall terminate on March 31,
2015, and no Option shall be granted under the Plan after such date. 

	14.  	Effective
Date of Plan  

        The
Board created the Plan effective April 1, 2005. 

SCHEDULE
A to a stock option plan of Sky Petroleum, Inc. effective •, 2005. 

SKY PETROLEUM, INC. 

(the “Corporation”)  

STOCK OPTION PLAN 

Certificate of Grant  

	

Number of Certificate

•	

Number of Common Shares 

Under Option 

•

        This
certifies that • [grantee] has been granted an option (the
“Option”) pursuant to the stock option plan (the
“Plan”) of the Corporation which was effective April 1,
2005 to purchase • common shares (the “Option Shares”)
of the Corporation at a price of $• per share subject to the provisions of the Plan,
which provisions are incorporated herein by reference. The Option Shares covered by this
certificate are exclusive of any other common shares in the capital of the Corporation
which may have been the subject of a previous grant of an option to the same grantee. 

        The
terms of the Option commence •, 200• and shall end at the close of business on•, 200• unless sooner ended under the provisions of the Plan. 

      The
Option vests on •.

        The
Option is subject to the approval of the applicable regulatory authorities and shall not
be exercisable until such approval is obtained. 

        Dated
as of this • day of •, 200•. 

	  	

 • [director or officer]EXHIBIT 10.8  

SKY PETROLEUM, INC. 

2005 U.S. STOCK
INCENTIVE PLAN 

AUGUST 25, 2005 

Table of Contents 

			
	Section 1 	 	Purpose 	  	1 	 
	 
	Section 2 	  	Definitions 	  	1 	 
	 
	Section 3 	  	Administration 	  	3 	 
	         (a)	 	Power and Authority of the Committee	 	3	 
	         (b)	 	Power and Authority of the Board	 	4	 
	 
	Section 4 	  	Shares Available for Awards 	  	4 	 
	         (a)	 	Shares Available	 	4	 
	         (b)	 	Accounting for Awards	 	4	 
	         (c)	 	Adjustments	 	4	 
	         (d)	 	Award Limitations Under the Plan	 	5	 
	 
	Section 5 	  	Eligibility 	  	5 	 
	 
	Section 6 	  	Awards 	  	5 	 
	         (a)	 	Options	 	5	 
	         (b)	 	Stock Appreciation Rights	 	7	 
	         (c)	 	Restricted Stock and Restricted Stock Units	 	7	 
	         (d)	 	Performance Awards	 	8	 
	         (e)	 	Dividend Equivalents	 	8	 
	         (f)	 	Other Stock Grants	 	8	 
	         (g)	 	Other Stock-Based Awards	 	9	 
	         (h)	 	General	 	9	 
	 
	Section 7 	  	Amendment and Termination; Adjustments 	  	10 	 
	         (a)	 	Amendments to the Plan	 	10	 
	         (b)	 	Amendments to Awards	 	11	 
	         (c)	 	Correction of Defects, Omissions and Inconsistencies	 	11	 
	 
	Section 8 	  	Income Tax Withholding 	  	11 	 
	 
	Section 9 	  	General Provisions 	  	12 	 
	         (a)	 	No Rights to Awards	 	12	 
	         (b)	 	Award Agreements	 	12	 
	         (c)	 	Plan Provisions Control	 	12	 
	         (d)	 	No Rights of Stockholders	 	12	 
	         (e)	 	No Limit on Other Compensation Arrangements	 	12	 
	         (f)	 	No Right to Employment	 	12	 
	         (g)	 	Governing Law	 	13	 
	         (h)	 	Severability	 	13	 
	         (i)	 	No Trust or Fund Created	 	13	 
	         (j)	 	Other Benefits	 	13	 

ii 

		 		  		 
	         (k)	 	No Fractional Shares	 	13	 
	         (l)	 	Headings	 	13	 
	         (m)	 	Section 16 Compliance; Section 162(m) Administration	 	13	 
	         (n)	 	Conditions Precedent to Issuance of Shares	 	14	 
	 
	Section 10.  	  	Effective Date of the Plan 	  	14 	 
	 
	Section 11.  	  	Term of the Plan 	  	14 	 

iii 

SKY PETROLEUM, INC.

2005 U.S. STOCK INCENTIVE PLAN 

Section 1.   Purpose 

        The
purpose of the Plan is to promote the interests of the Company and its stockholders by
aiding the Company in attracting and retaining employees, officers, consultants,
independent contractors and directors capable of assuring the future success of the
Company, to offer such persons incentives to put forth maximum efforts for the success of
the Company’s business and to afford such persons an opportunity to acquire a
proprietary interest in the Company.  

Section 2.   
Definitions 

        As
used in the Plan, the following terms shall have the meanings set forth below: 

        (a)              “Affiliate” shall
mean (i) any entity that, directly or           indirectly through one or more
intermediaries, is controlled by the Company and           (ii) any entity in which
the Company has a significant equity interest, in           each case as determined by
the Committee.  

        (b)              “Award” shall
mean any Option, Stock Appreciation Right,           Restricted Stock, Restricted Stock
Unit, Performance Award, Dividend Equivalent,           Other Stock Grant or Other
Stock-Based Award granted under the Plan.  

        (c)              “Award
Agreement” shall mean any written agreement, contract or           other
instrument or document evidencing any Award granted under the Plan. Each           Award
Agreement shall be subject to the applicable terms and conditions of the           Plan
and any other terms and conditions (not inconsistent with the Plan)           determined
by the Committee.  

        (d)              “Board” shall
mean the Board of Directors of the Company.  

        (e)              “Code” shall
mean the Internal Revenue Code of 1986, as amended           from time to time, and any
regulations promulgated thereunder.  

        (f)              “Committee” shall
mean a committee of Directors designated by           the Board to administer the Plan,
which shall initially be the Company’s           compensation committee. The
Committee shall be comprised of not less than such           number of Directors as shall
be required to permit Awards granted under the Plan           to qualify under Rule 16b-3
and Section 162(m) of the Code, and each           member of the Committee shall be
a “Non-Employee Director.” 

        (g)              “Company” shall
mean Sky Petroleum, Inc., a Nevada corporation,           and any successor corporation.  

        (h)              “Director” shall
mean a member of the Board, including any           Non-Employee Director.  

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Sky Petroleum, Inc.	
2005 U.S. Stock Incentive Plan 

        (i)              “Dividend
Equivalent” shall mean any right granted under           Section 6(e) of
the Plan.  

        (j)              “Eligible
Person” shall mean any employee, officer, consultant,           independent
contractor or director providing services to the Company or any           Affiliate who
the Committee determines to be an Eligible Person; provided,           however, that such
definition shall not include any employee, officer,           consultant, independent
contractor or director who is a resident of Canada.  

        (k)              “Exchange
Act” shall mean the Securities Exchange Act of 1934,           as amended.  

        (l)              “Fair
Market Value” shall mean, with respect to any property           (including,
without limitation, any Shares or other securities), the fair market           value of
such property determined by such methods or procedures as shall be           established
from time to time by the Committee. Notwithstanding the foregoing           and unless
otherwise determined by the Committee, the Fair Market Value of a           Share as of a
given date shall be, if the Shares are then listed on the           National
Association of Securities Dealers Over the Counter Bulletin Board or           the
primary market for the Company’s Shares (“Primary Market”),           the
average of the high and low sales price of one Share as reported on the           Primary
Market on such date or, if the Primary Market is not open for trading on           such
date, on the most recent preceding date when it is open for trading.  

        (m)              “Incentive
Stock Option” shall mean an option granted under           Section 6(a) of
the Plan that is intended to qualify as an “incentive           stock option” in
accordance with the terms of Section 422 of the Code           or any successor
provision.  

        (n)              “Non-Employee
Director” shall mean any Director who is not also           an employee of the
Company or an Affiliate within the meaning of Rule 16b-3           and an “outside
director” within the meaning of Section 162(m) of           the Code.  

        (o)              “Non-Qualified
Stock Option” shall mean an option granted under           Section 6(a) of
the Plan that is not an Incentive Stock Option.  

        (p)              “Option” shall
mean an Incentive Stock Option or a           Non-Qualified Stock Option.  

        (q)              “Other
Stock Grant” shall mean any right granted under           Section 6(f) of
the Plan.  

        (r)              “Other
Stock-Based Award” shall mean any right granted under           Section 6(g)
of the Plan.  

        (s)              “Participant” shall
mean an Eligible Person designated to be           granted an Award under the Plan.  

        (t)              “Performance
Award” shall mean any right granted under           Section 6(d) of the
Plan.  

        (u)              “Person” shall
mean any individual or entity, including a           corporation, partnership, limited
liability company, association, joint venture           or trust.  

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Sky Petroleum, Inc.	
2005 U.S. Stock Incentive Plan 

        (v)              “Plan” shall
mean the Sky Petroleum 2005 U.S. Stock Incentive           Plan, as amended from time to
time, the provisions of which are set forth           herein.  

        (w)              “Reload
Option” shall mean any Option granted under Section           6(a)(v) of the
Plan.  

        (x)              “Restricted
Stock” shall mean any Share granted under           Section 6(c) of the
Plan.  

        (y)              “Restricted
Stock Unit” shall mean any unit granted under           Section 6(c) of the
Plan evidencing the right to receive a Share (or a cash           payment equal to the
Fair Market Value of a Share) at some future date.  

        (z)              “Rule 16b-3” shall
mean Rule 16b-3 promulgated by the           Securities and Exchange Commission
under the Securities Exchange Act of 1934, as           amended, or any successor rule or
regulation.  

        (aa)              “Securities
Act” shall mean the Securities Act of 1933, as           amended.  

        (bb)              “Share” or
“Shares” shall mean a share or           shares of common stock of the
Company or such other securities or property as           may become subject to Awards
pursuant to an adjustment made under           Section 4(c) of the Plan.  

        (cc)              “Stock
Appreciation Right” shall mean any right granted under           Section 6(b)
of the Plan.  

     Section 3.   
          Administration 

        (a)    Power
and Authority of the Committee. The Plan shall be administered by           the
Committee. Subject to the express provisions of the Plan and to applicable           law,
the Committee shall have full power and authority to: (i) designate
          Participants; (ii) determine the type or types of Awards to be granted to
          each Participant under the Plan; (iii) determine the number of Shares to
be           covered by (or the method by which payments or other rights are to be
determined           in connection with) each Award; (iv) determine the terms and
conditions of           any Award or Award Agreement; (v) amend the terms and
conditions of any           Award or Award Agreement and accelerate the exercisability of
any Option or           waive any restrictions relating to any Award; (vi) determine
whether, to           what extent and under what circumstances Awards may be exercised in
cash,           Shares, other securities, other Awards or other property, or canceled,
forfeited           or suspended; (vii) determine whether, to what extent and under
what           circumstances cash, Shares, other securities, other Awards, other property
and           other amounts payable with respect to an Award under the Plan shall be
deferred           either automatically or at the election of the holder thereof or the
Committee           (provided, however, that the par value of any Shares
and           Restricted Stock shall be paid in the form of cash, services rendered,
personal           property, real property or a combination thereof prior to their
issuance);           (viii) interpret and administer the Plan and any instrument or
agreement,           including an Award Agreement, relating to the Plan; (ix) establish,
amend,           suspend or waive such rules and regulations and appoint such agents as
it shall           deem appropriate for the proper administration of the Plan; and (x) make
          any other determination and take any other action that the Committee deems
          necessary or desirable for the administration of  

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Sky Petroleum, Inc.	
2005 U.S. Stock Incentive Plan 

the Plan. Unless otherwise expressly
provided in the Plan, all designations, determinations, interpretations and other
decisions under or with respect to the Plan or any Award shall be within the sole
discretion of the Committee, may be made at any time and shall be final, conclusive and
binding upon any Eligible Person and any holder or beneficiary of any Award. 

        (b)    Power
and Authority of the Board. Notwithstanding anything to the           contrary
contained herein, the Board may, at any time and from time to time,           without any
further action of the Committee, exercise the powers and duties of           the
Committee under the Plan.  

     Section 4.   
          Shares Available for Awards 

        (a)    Shares
Available. Subject to adjustment as provided in Section 4(c)           of the
Plan, the aggregate number of Shares that may be issued under the Plan           shall be
3,321,600 Shares (less the number of Shares issuable upon exercise of           options
granted by the Company under all other stock incentive plans on the date           of any
grant under the Plan). Shares to be issued under the Plan may be either
          authorized but unissued Shares or Shares re-acquired and held in treasury.
          Notwithstanding the foregoing, (i) the number of Shares available for
          granting Incentive Stock Options under the Plan shall not exceed 3,321,600
          Shares (less the number of Shares issuable upon exercise of options granted by
          the Company under all other stock incentive plans on the date of any grant
under           the Plan), subject to adjustment as provided in Section 4(c) of the
Plan           and subject to the provisions of Section 422 or 424 of the Code or
any           successor provision and (ii) the number of Shares available for
granting           Restricted Stock and Restricted Stock Units shall not exceed 3,321,600
Shares           (less the number of Shares issuable upon exercise of options granted by
the           Company under all other stock incentive plans on the date of any grant
under the           Plan), subject to adjustment as provided in Section 4(c) of the
Plan.  

        (b)    Accounting
for Awards. For purposes of this Section 4, if an Award           entitles the
holder thereof to receive or purchase Shares, the number of Shares           covered by
such Award or to which such Award relates shall be counted on the           date of grant
of such Award against the aggregate number of Shares available for           granting
Awards under the Plan. Any Shares that are used by a Participant as           full or
partial payment to the Company of the purchase price relating to an           Award,
including Shares tendered in connection with the grant of a Reload           Option, or
in connection with the satisfaction of tax obligations relating to an           Award,
shall again be available for granting Awards under the Plan. In addition,           if
any Shares covered by an Award or to which an Award relates are not purchased
          or are forfeited, or if an Award otherwise terminates without delivery of any
          Shares, then the number of Shares counted against the aggregate number of
Shares           available under the Plan with respect to such Award, to the extent of
any such           forfeiture or termination, shall again be available for granting
Awards under           the Plan.  

        (c)    Adjustments.
In the event that the Committee shall determine that any           dividend or other
distribution (whether in the form of cash, Shares, other           securities or other
property), recapitalization, stock split, reverse stock           split, reorganization,
merger, consolidation, split-up, spin-off, combination,           repurchase or exchange
of Shares or other securities of the Company, issuance of           warrants or other
rights to purchase Shares or other securities of the Company           or other similar
corporate transaction or event affects the Shares such that an           adjustment is
determined by the Committee to be appropriate in order to prevent           dilution or
enlargement of the  

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2005 U.S. Stock Incentive Plan 

benefits or potential benefits
intended to be made available under the Plan, then the Committee shall, in such manner as
it may deem equitable, adjust any or all of (i) the number and type of Shares (or
other securities or other property) that thereafter may be made the subject of Awards,
(ii) the number and type of Shares (or other securities or other property) subject to
outstanding Awards and (iii) the purchase price or exercise price with respect to any
Award; provided, however, that the number of Shares covered by any Award or
to which such Award relates shall always be a whole number. 

        (d)    Award
Limitations Under the Plan. No Eligible Person may be granted any           Award or
Awards under the Plan, the value of which Award or Awards is based           solely on an
increase in the value of the Shares after the date of grant of such           Award or
Awards, for more than3,321,600 Shares (less the number of           Shares
issuable upon exercise of options granted by the Company under all other           stock
incentive plans on the date of any grant under the Plan and subject to
          adjustment as provided for in Section 4(c) of the Plan), in the aggregate
          in any taxable year. The foregoing annual limitation specifically includes the
          grant of any Award or Awards representing “qualified performance-based
          compensation” within the meaning of Section 162(m) of the Code.  

Section 5.   
Eligibility 

        Any
Eligible Person shall be eligible to be designated a Participant. In determining which
Eligible Persons shall receive an Award and the terms of any Award, the Committee may take
into account the nature of the services rendered by the respective Eligible Persons, their
present and potential contributions to the success of the Company or such other factors as
the Committee, in its discretion, shall deem relevant. Notwithstanding the foregoing, an
Incentive Stock Option may only be granted to full-time or part-time employees (which term
as used herein includes, without limitation, officers and directors who are also
employees), and an Incentive Stock Option shall not be granted to an employee of an
Affiliate unless such Affiliate is also a “subsidiary corporation” of the
Company within the meaning of Section 424(f) of the Code or any successor provision. 

Section 6.   Awards 

        (a)
Options. The Committee is hereby authorized to grant Options to Eligible
          Persons with the following terms and conditions and with such additional terms
          and conditions not inconsistent with the provisions of the Plan as the
Committee           shall determine:  

	  	        (i)
    Exercise Price.  The purchase price per Share purchasable under an Option
          shall be determined by the Committee; provided, however, that
such           purchase price shall not be less than 100% of the Fair Market Value of a
Share           on the date of grant of such Option.  

	  	        (ii)
    Option Term.  The term of each Option shall be fixed by the Committee at
          the time of grant.  

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	  	        (iii)
   Time and Method of Exercise.  The Committee shall determine the time or
               times at which an Option may be exercised in whole or in part and the
method or                methods by which, and the form or forms (including, without
limitation, cash,                Shares, other securities, other Awards or other
property, or any combination                thereof, having a Fair Market Value on the
exercise date equal to the applicable                exercise price) in which, payment of
the exercise price with respect thereto may                be made or deemed to have been
made.  

	  	        (iv)
    Incentive Stock Options.  Notwithstanding anything in the Plan to the
               contrary, the following additional provisions shall apply to the grant of
stock                options which are intended to qualify as Incentive Stock Options:  

	  	        (A)
                   The Committee will not grant Incentive Stock Options in which the
aggregate Fair                Market Value (determined as of the time the option is
granted) of the Shares                with respect to which Incentive Stock Options are
exercisable for the first time                by any Participant during any calendar year
(under this Plan and all other plans                of the Company and its Affiliates)
shall exceed $100,000.  

	  	        (B)
    All Incentive Stock Options must be granted within ten years from
the earlier of                the date on which this Plan was adopted by the Board or the
date this Plan was                approved by the stockholders of the Company.  

	  	        (C)
    Unless sooner exercised, all Incentive Stock Options shall expire
and no longer                be exercisable no later than 10 years after the date of
grant; provided, however, that in the case of a grant of an Incentive Stock
Option to a                Participant who, at the time such Option is granted, owns
(within the meaning of                Section 422 of the Code) stock possessing more
than 10% of the total                combined voting power of all classes of stock of the
Company or of its                Affiliate, such Incentive Stock Option shall expire and
no longer be exercisable                no later than 5 years from the date of grant.  

	  	        (D)
    The purchase price per Share for an Incentive Stock Option shall be
not less                than 100% of the Fair Market Value of a Share on the date of
grant of the                Incentive Stock Option; provided, however,
that, in the case of                the grant of an Incentive Stock Option to a
Participant who, at the time such                Option is granted, owns (within the
meaning of Section 422 of the Code)                stock possessing more than 10% of
the total combined voting power of all classes                of stock of the Company or
of its Affiliate, the purchase price per Share                purchasable under an
Incentive Stock Option shall be not less than 110% of the                Fair Market
Value of a Share on the date of grant of the Inventive Stock Option.  

	  	        (E)
    Any Incentive Stock Option authorized under the Plan shall contain
such other                provisions as the Committee shall deem advisable, but shall in
all events be                consistent with and contain all provisions required in order
to qualify the                Option as an Incentive Stock Option.  

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	  	        (v)
    Reload Options.  The Committee may grant Reload Options, separately or
together with another Option and subject to the terms and conditions established by the
Committee, pursuant to which the Participant would be granted a new Non-Qualified Stock
Option when the payment of the exercise price of a previously granted option for common
stock is made by the delivery of Shares owned by the Participant pursuant to Section 6(a)(iii)
hereof or the relevant provisions of another plan of the Company, when Shares are
tendered or withheld as payment of the amount to be withheld under applicable income tax
laws in connection with the exercise of an Option, which new Non-Qualified Stock Option
would be a Non-Qualified Stock Option to purchase the number of Shares not exceeding the
sum of (A) the number of Shares so provided as consideration upon the exercise of
the previously granted option to which such Reload Option relates and (B) the number
of Shares, if any, tendered or withheld as payment of the amount to be withheld under
applicable tax laws in connection with the exercise of the option to which such Reload
Option relates pursuant to the relevant provisions of the plan or agreement relating to
such option. Reload Options may be granted with respect to options previously granted
under the Plan or any other stock option plan of the Company or any Affiliate or may be
granted in connection with any option granted under the Plan or any other stock option
plan of the Company or any Affiliate at the time of such grant. Such Reload Options shall
have a per share exercise price equal to the Fair Market Value of one Share as of the
date of grant of the new Non-Qualified Stock Option. Any Reload Option shall be subject
to availability of sufficient Shares for grant under the Plan. Shares surrendered as part
or all of the exercise price of the Non-Qualified Stock Option to which it relates that
have been owned by the optionee less than six months will not be counted for purposes of
determining the number of Shares that may be purchased pursuant to a Reload Option.  

        (b)    Stock
Appreciation Rights. The Committee is hereby authorized to grant           Stock
Appreciation Rights to Eligible Persons subject to the terms of the Plan.           Each
Stock Appreciation Right granted under the Plan shall confer on the holder           upon
exercise the right to receive, as determined by the Committee, cash or a           number
of Shares equal to the excess of (a) the Fair Market Value of one           Share on
the date of exercise (or, if the Committee shall so determine, at any           time
during a specified period before or after the date of exercise) over           (b) the
grant price of the Stock Appreciation Right as determined by the           Committee,
which grant price shall not be less than 100% of the Fair Market           Value of one
Share on the date of grant of the Stock Appreciation Right. Subject           to the
terms of the Plan, the grant price, term, methods of exercise, dates of
          exercise, methods of settlement and any other terms and conditions (including
          conditions or restrictions on the exercise thereof) of any Stock Appreciation
          Right shall be as determined by the Committee.  

        (c)    Restricted
Stock and Restricted Stock Units. The Committee is hereby           authorized to
grant Restricted Stock and Restricted Stock Units to Eligible           Persons with the
following terms and conditions and with such additional terms           and conditions
not inconsistent with the provisions of the Plan as the Committee           shall
determine:  

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	  	        (i)
    Restrictions.                Shares
of Restricted Stock and Restricted Stock Units shall be subject to such
               restrictions as the Committee may impose (including, without limitation, a
               restriction on or prohibition against the right to receive any dividend or
other                right or property with respect thereto), which restrictions may
lapse separately                or in combination at such time or times, in such
installments or otherwise as                the Committee may deem appropriate.  

	  	        (ii)
    Stock Certificates.   Any Restricted Stock granted under the Plan shall be
          evidenced by the issuance of a stock certificate or certificates, which shall
be           held by the Company. Such certificate or certificates shall be registered in
the           name of the Participant and shall bear an appropriate legend referring to
the           applicable Award Agreement and possible forfeiture of such shares of
Restricted           Stock.  

	  	        (iii)
    Forfeiture.  Except as otherwise determined by the Committee, upon a
          Participant’s termination of employment (as determined under criteria
          established by the Committee) during the applicable restriction period, all
          applicable Shares of Restricted Stock and Restricted Stock Units at such time
          subject to restriction shall be forfeited and reacquired by the Company; provided,
however, that the Committee may, when it finds that a           waiver would be in
the best interest of the Company, waive in whole or in part           any or all
remaining restrictions with respect to Shares of Restricted Stock or           Restricted
Stock Units.  

        (d)
    Performance Awards.  The Committee is hereby authorized to grant
          Performance Awards to Eligible Persons subject to the terms of the Plan. A
          Performance Award granted under the Plan (i) may be denominated or payable
          in cash, Shares (including, without limitation, Restricted Stock and Restricted
          Stock Units), other securities, other Awards or other property and
          (ii) shall confer on the holder thereof the right to receive payments, in
          whole or in part, upon the achievement of such performance goals during such
          performance periods as the Committee shall establish. Subject to the terms of
          the Plan, the performance goals to be achieved during any performance period,
          the length of any performance period, the amount of any Performance Award
          granted, the amount of any payment or transfer to be made pursuant to any
          Performance Award and any other terms and conditions of any Performance Award
          shall be determined by the Committee.  

        (e)
    Dividend Equivalents.  The Committee is hereby authorized to grant
          Dividend Equivalents to Eligible Persons under which the Participant shall be
          entitled to receive payments (in cash, Shares, other securities, other Awards
or           other property as determined in the discretion of the Committee) equivalent
to           the amount of cash dividends paid by the Company to holders of Shares with
          respect to a number of Shares determined by the Committee. Subject to the terms
          of the Plan, such Dividend Equivalents may have such terms and conditions as
the           Committee shall determine.  

        (f)
    Other Stock Grants.  The Committee is hereby authorized, subject to the
          terms of the Plan, to grant to Eligible Persons Shares without restrictions
          thereon as are deemed by the Committee to be consistent with the purpose of the
          Plan.  

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        (g)
    Other Stock-Based Awards. The Committee is hereby authorized to grant to
          Eligible Persons, subject to the terms of the Plan, such other Awards that are
          denominated or payable in, valued in whole or in part by reference to, or
          otherwise based on or related to, Shares (including, without limitation,
          securities convertible into Shares), as are deemed by the Committee to be
          consistent with the purpose of the Plan. Shares or other securities delivered
          pursuant to a purchase right granted under this Section 6(g) shall be
          purchased for such consideration, which may be paid by such method or methods
          and in such form or forms (including, without limitation, cash, Shares,
          promissory notes, other securities, other Awards or other property or any
          combination thereof), as the Committee shall determine, the value of which
          consideration, as established by the Committee, shall not be less than 100% of
          the Fair Market Value of such Shares or other securities as of the date such
          purchase right is granted.  

        (h)
    General.  

	  	        (i)
    Consideration for Awards.  Awards may be granted for no cash consideration
          or for any cash or other consideration as determined by the Committee and
          required by applicable law.  

	  	        (ii)
    Awards May Be Granted Separately or Together.  Awards may, in the
          discretion of the Committee, be granted either alone or in addition to, in
          tandem with or in substitution for any other Award or any award granted under
          any plan of the Company or any Affiliate. Awards granted in addition to or in
          tandem with other Awards or in addition to or in tandem with awards granted
          under any such other plan of the Company or any Affiliate may be granted either
          at the same time as or at a different time from the grant of such other Awards
          or awards.  

	  	        (iii)
    Forms of Payment under Awards.  Subject to the terms of the Plan, payments
          or transfers to be made by the Company or an Affiliate upon the grant, exercise
          or payment of an Award may be made in such form or forms as the Committee shall
          determine (including, without limitation, cash, Shares, promissory notes
          (provided, however, that the acceptance of such promissory notes
          does not conflict with Section 402 of the Sarbanes-Oxley Act of 2002), other
          securities, other Awards or other property or any combination thereof), and may
          be made in a single payment or transfer, in installments or on a deferred
basis,           in each case in accordance with rules and procedures established by the
          Committee. Such rules and procedures may include, without limitation,
provisions           for the payment or crediting of reasonable interest on installment
or deferred           payments or the grant or crediting of Dividend Equivalents with
respect to           installment or deferred payments.  

	  	        (iv)
    Limits on Transfer of Awards.  No Award (other than Other Stock Grants)
          and no right under any such Award shall be transferable by a Participant
          otherwise than by will or by the laws of descent and distribution and the
          Company shall not be required to recognize any attempted assignment of such
          rights by any Participant; provided, however, that, if so
          determined by the Committee, a Participant may, in the manner established by
the           Committee, designate a beneficiary or beneficiaries to exercise the rights
of           the Participant and receive any property distributable with respect to any
Award  

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2005 U.S. Stock Incentive Plan 

	  	
upon
the death of the Participant; provided, further, that, if so determined by
the Committee, a Participant may transfer a Non-Qualified Stock Option to any Family
Member (as such term is defined in the General Instructions to Form S-8 (or successor to
such Instructions or such Form)) at any time that such Participant holds such Option,
provided that the Participant may not receive any consideration for such transfer,
the Family Member may not make any subsequent transfers other than by will or by the laws
of descent and distribution and the Company receives written notice of such transfer,
provided, further, that, if so determined by the Committee and except in the
case of an Incentive Stock Option, Awards may be transferable as determined by the
Committee. Except as otherwise determined by the Committee, each Award (other than an
Incentive Stock Option) or right under any such Award shall be exercisable during the
Participant’s lifetime only by the Participant or, if permissible under applicable
law, by the Participant’s guardian or legal representative. Except as otherwise
determined by the Committee, no Award (other than an Incentive Stock Option) or right
under any such Award may be pledged, alienated, attached or otherwise encumbered, and any
purported pledge, alienation, attachment or other encumbrance thereof shall be void and
unenforceable against the Company or any Affiliate. 

	  	        (v)
    Term of Awards.  Subject to Section 6(a)(iv)(C), the term of each Award
          shall be for such period as may be determined by the Committee.  

	  	        (vi)
    Restrictions; Securities Exchange Listing.  All Shares or other securities
          delivered under the Plan pursuant to any Award or the exercise thereof shall be
          subject to such stop transfer orders and other restrictions as the Committee
may           deem advisable under the Plan, applicable federal or state securities laws
and           regulatory requirements, and the Committee may direct appropriate stop
transfer           orders and cause other legends to be placed on the certificates for
such Shares           or other securities to reflect such restrictions. If the Shares or
other           securities are traded on a securities exchange, the Company shall not be
          required to deliver any Shares or other securities covered by an Award unless
          and until such Shares or other securities have been admitted for trading on
such           securities exchange.  

	  	        (vii)
    Prohibition on Option Repricing.  Except as provided in Section 4(c)
          hereof, no Option may be amended to reduce its initial exercise price and no
          Option shall be canceled and replaced with an Option or Options having a lower
          exercise price, without the approval of the stockholders of the Company or
          unless there would be no material adverse effect on the Company’s
financial           statements as prepared in accordance with Generally Accepted
Accounting           Principles.  

Section 7.   Amendment
and Termination; Adjustments 

        (a)
    Amendments to the Plan.  The Board may amend, alter, suspend, discontinue
          or terminate the Plan at any time; provided, however, that,
          notwithstanding any other provision of the Plan or any Award Agreement, without
          the approval of the stockholders of the Company, no such amendment, alteration,
          suspension, discontinuation or termination shall be made that, absent such
          approval:  

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	  	        (i)
              violates the rules or regulations of the National Association of Securities
          Dealers, Inc. or any other securities exchange that are applicable to the
          Company;  

	  	        (ii)
              causes the Company to be unable, under the Code, to grant Incentive Stock
          Options under the Plan;  

	  	        (iii)
              increases the number of shares authorized under the Plan as specified in
          Section 4(a);  

	  	        (iv)
              permits the award of Options or Stock Appreciation Rights at a price less than
          100% of the Fair Market Value of a Share on the date of grant of such Option or
          Stock Appreciation Right, as prohibited by Sections 6(a)(i) and 6(b)(ii) of the
          Plan or the repricing of Options or Stock Appreciation Rights, as prohibited by
          Section 3(a)(v) of the Plan; or  

	  	        (v)
              would prevent the grant of Options or Stock Appreciation Rights that would
          qualify under Section 162(m) of the Code.  

        (b)
    Amendments to Awards.  The Committee may waive any conditions of or rights
          of the Company under any outstanding Award, prospectively or retroactively.
          Except as otherwise provided herein or in an Award Agreement, the Committee may
          not amend, alter, suspend, discontinue or terminate any outstanding Award,
          prospectively or retroactively, if such action would adversely affect the
rights           of the holder of such Award, without the consent of the Participant or
holder or           beneficiary thereof. Notwithstanding the foregoing, the Committee
shall not           waive any conditions or rights of the Company, or otherwise amend or
alter any           outstanding Award in such a manner as to cause such Award not to
constitute           “qualified performance based compensation” within the
meaning of           Section 162(m) of the Code.  

        (c)
    Correction of Defects, Omissions and Inconsistencies.  The Committee may
          correct any defect, supply any omission or reconcile any inconsistency in the
          Plan or any Award in the manner and to the extent it shall deem desirable to
          carry the Plan into effect.  

Section 8.   Income Tax
Withholding 

        In
order to comply with all applicable federal, state or local income tax laws or
regulations, the Company may take such action as it deems appropriate to ensure that all
applicable federal, state or local payroll, withholding, income or other taxes, which are
the sole and absolute responsibility of a Participant, are withheld or collected from such
Participant. In order to assist a Participant in paying all or a portion of the federal,
state and local taxes to be withheld or collected upon exercise or receipt of (or the
lapse of restrictions relating to) an Award, the Committee, in its discretion and subject
to such additional terms and conditions as it may adopt, may permit the Participant to
satisfy such tax obligation by (i) electing to have the Company withhold a portion of
the Shares otherwise to be delivered upon exercise or receipt of (or the lapse of
restrictions relating to) such Award with a Fair Market Value equal 

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2005 U.S. Stock Incentive Plan 

to the amount of such taxes or
(ii) delivering to the Company Shares other than Shares issuable upon exercise or
receipt of (or the lapse of restrictions relating to) such Award with a Fair Market Value
equal to the amount of such taxes (but only to the extent of the minimum amount required
to be withheld under applicable laws or regulations). The election, if any, must be made
on or before the date that the amount of tax to be withheld is determined. 

     Section 9.   
          General Provisions 

        (a)    No
Rights to Awards. No Eligible Person or other Person shall have any           claim
to be granted any Award under the Plan, and there is no obligation for
          uniformity of treatment of Eligible Persons or holders or beneficiaries of
          Awards under the Plan. The terms and conditions of Awards need not be the same
          with respect to any Participant or with respect to different Participants.  

        (b)    Award
Agreements. No Participant will have rights under an Award granted           to such
Participant unless and until an Award Agreement shall have been duly           executed
on behalf of the Company and, if requested by the Company, signed by           the
Participant.  

        (c)    Plan
Provisions Control. In the event that any provision of an Award           Agreement
conflicts with or is inconsistent in any respect with the terms of the           Plan as
set forth herein or subsequently amended, the terms of the Plan shall           control.  

        (d)    No
Rights of Stockholders. Except with respect to Shares of Restricted           Stock
as to which the Participant has been granted the right to vote, neither a
          Participant nor the Participant’s legal representative shall be, or have
          any of the rights and privileges of, a stockholder of the Company with respect
          to any Shares issuable to such Participant upon the exercise or payment of any
          Award, in whole or in part, unless and until such Shares have been issued in
the           name of such Participant or such Participant’s legal representative
without           restrictions thereto.  

        (e)    No
Limit on Other Compensation Arrangements. Nothing contained in the           Plan
shall prevent the Company or any Affiliate from adopting or continuing in
          effect other or additional compensation arrangements, and such arrangements may
          be either generally applicable or applicable only in specific cases.  

        (f)    No
Right to Employment. The grant of an Award shall not be construed as           giving
a Participant the right to be retained in the employ, or us giving a           director
of the Company or an Affiliate the right to continue as a director or           an
Affiliate of the Company or any Affiliate, nor will it affect in any way the
          right of the Company or an Affiliate to terminate such employment at any time,
          with or without cause. In addition, the Company or an Affiliate may at any time
          dismiss a Participant from employment, or terminate the term of a director of
          the Company or an Affiliate, free from any liability or any claim under the
Plan           or any Award, unless otherwise expressly provided in the Plan or in any
Award           Agreement. Nothing in this Plan shall confer on any person any legal or
          equitable right against the Company or any Affiliate, directly or indirectly,
or           give rise to any cause of action at law or in equity against the Company or
an           Affiliate. The Awards granted hereunder shall not form any part of the wages
or           salary of any Eligible Person for purposes of severance pay or termination
          indemnities, irrespective of the reason for termination of employment. Under no
          circumstances shall any person ceasing to be  

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an employee of the Company or any
Affiliate be entitled to any compensation for any loss of any right or benefit under the
Plan which such employee might otherwise have enjoyed but for termination of employment,
whether such compensation is claimed by way of damages for wrongful or unfair dismissal,
breach of contract or otherwise. By participating in the Plan, each Participant shall be
deemed to have accepted all the conditions of the Plan and the terms and conditions of any
rules and regulations adopted by the Committee and shall be fully bound thereby. 

        (g)    Governing
Law. The validity, construction and effect of the Plan or any           Award, and
any rules and regulations relating to the Plan or any Award, shall be
          determined in accordance with the internal laws, and not the law of conflicts,
          of the State of Nevada.  

        (h)    Severability.
If any provision of the Plan or any Award is or becomes or           is deemed to be
invalid, illegal or unenforceable in any jurisdiction or would           disqualify the
Plan or any Award under any law deemed applicable by the           Committee, such
provision shall be construed or deemed amended to conform to           applicable laws,
or if it cannot be so construed or deemed amended without, in           the determination
of the Committee, materially altering the purpose or intent of           the Plan or the
Award, such provision shall be stricken as to such jurisdiction           or Award, and
the remainder of the Plan or any such Award shall remain in full           force and
effect.  

        (i)    No
Trust or Fund Created. Neither the Plan nor any Award shall create or           be
construed to create a trust or separate fund of any kind or a fiduciary
          relationship between the Company or any Affiliate and an Eligible Person or any
          other Person. To the extent that any Person acquires a right to receive
payments           from the Company or any Affiliate pursuant to an Award, such right
shall be no           greater than the right of any unsecured general creditor of the
Company or any           Affiliate.  

        (j)    Other
Benefits. No compensation or benefit awarded to or realized by any
          Participant under the Plan shall be included for the purpose of computing such
          Participant’s compensation under any compensation-based retirement,
          disability, or similar plan of the Company unless required by law or otherwise
          provided by such other plan.  

        (k)    No
Fractional Shares. No fractional Shares shall be issued or delivered
          pursuant to the Plan or any Award, and the Committee shall determine whether
          cash shall be paid in lieu of any fractional Shares or whether such fractional
          Shares or any rights thereto shall be canceled, terminated or otherwise
          eliminated.  

        (l)    Headings.
Headings are given to the Sections and subsections of the Plan           solely as a
convenience to facilitate reference. Such headings shall not be           deemed in any
way material or relevant to the construction or interpretation of           the Plan or
any provision thereof.  

        (m)    Section 16
Compliance; Section 162(m) Administration. The Plan           is intended to
comply in all respects with Rule 16b-3 or any successor           provision, as in
effect from time to time, and in all events the Plan shall be           construed in
accordance with the requirements of Rule 16b-3. If any Plan           provision does
not comply with Rule 16b-3 as hereafter amended or           interpreted, the
provision shall be deemed inoperative. The Board of Directors,           in its absolute
discretion, may  

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2005 U.S. Stock Incentive Plan 

bifurcate the Plan so as to restrict,
limit or condition the use of any provision of the Plan with respect to persons who are
officers or directors subject to Section 16 of the Exchange Act without so
restricting, limiting or conditioning the Plan with respect to other Eligible Persons.
With respect to Options and Stock Appreciation Rights, the Company intends to have the
Plan administered in accordance with the requirements for the award of “qualified
performance-based compensation” within the meaning of Section 162(m) of the
Code. 

        (n)    Conditions
Precedent to Issuance of Shares. Shares shall not be issued           pursuant to the
exercise or payment of the purchase price relating to an Award           unless such
exercise or payment and the issuance and delivery of such Shares           pursuant
thereto shall comply with all relevant provisions of law, including,           without
limitation, the Securities Act, the Exchange Act, the rules and           regulations
promulgated thereunder, the requirements of any applicable Stock           Exchange and
the Delaware General Corporation Law. As a condition to the           exercise or payment
of the purchase price relating to such Award, the Company           may require that the
person exercising or paying the purchase price represent           and warrant that the
Shares are being purchased only for investment and without           any present
intention to sell or distribute such Shares if, in the opinion of           counsel for
the Company, such a representation and warranty is required by law.  

Section 10.   
Effective Date of the Plan 

        The
Plan shall be effective upon its adoption by the Board, provided, however,
that in the event the Plan is not approved by the stockholders of the Company within one
year thereafter, the Plan will be terminated and all Awards granted under the Plan will be
terminated and deemed null and void, provided, however, that with respect to
any Shares (including Shares of Restricted Stock) issued under the Plan prior to such
termination, the Plan shall be deemed to be effective. 

Section 11.    Term of
the Plan 

        No
Award shall be granted under the Plan after ten years from earlier of date of adoption of
Plan by Board or date of stockholder approval or any earlier date of discontinuation or
termination established pursuant to Section 7(a) of the Plan. However, unless
otherwise expressly provided in the Plan or in an applicable Award Agreement, any Award
theretofore granted may extend beyond such date, and the authority of the Committee
provided for hereunder with respect to the Plan and any Awards, and the authority of the
Board to amend the Plan, shall extend beyond the termination of the Plan. 

14 

	
Sky Petroleum, Inc.	
2005 U.S. Stock Incentive Plan

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