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CROWN OIL AND GAS INC.

Stock Option Plan

DATED: May 30, 2008

This Stock Option Plan (the "Plan") provides for the
grant of stock options to acquire shares in the common stock (the "Common
Shares") of Crown Oil and Gas Inc. (the "Company"), a corporation
organized under the laws of the State of Nevada. Stock options granted under
this Plan that qualify under Section 422 of the Internal Revenue Code of
1986 (United States), as amended (the "Code") are referred to in this
Plan as "Incentive Stock Options" and stock options that do not qualify
under Section 422 of the Code are referred to as "Non-Qualified Stock
Options". Incentive Stock Options and Non-Qualified Stock Options granted
under this Plan are collectively referred to as "Options".

1.          
 PURPOSE

1.1 ****The purpose of this Plan is to retain the services of valued key
employees and consultants of the Company and such other persons as the Plan
Administrator (as defined in Section 2.1 hereof) shall select in accordance with
Section 2 hereof, and to encourage such persons to acquire a greater proprietary
interest in the Company, thereby strengthening their incentive to achieve the
objectives of the shareholders of the Company, and to serve as an aid and
inducement in the hiring of new employees and to provide an equity incentive to
consultants and other persons selected by the Plan Administrator.

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

2.          
 ADMINISTRATION

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

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

2.3****
The Committee shall have the powers and authority vested in the Board hereunder
(including the power and authority to interpret any provision of the Plan or of
any Option). The members of any such Committee shall serve at the pleasure of
the Board. A majority of the members of the Committee shall constitute a quorum,
and all actions of the Committee shall be taken by a majority of the members
present. Any action may be taken by a written instrument signed by all of the
members of the Committee and any action so taken shall be fully effective as if
it had been taken at a meeting.

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

| | (a) | construe and interpret this
Plan;
| | --- | ---------------------------------

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| | (b) | define the terms used in the Plan;                                                                                                                                                                   
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                      
| | (c) | prescribe, amend and rescind the rules and regulations
      relating to this Plan;                                                                                                                  
| |     |                                                                                                                                                                                                      
| | (d) | correct any defect, supply any omission or reconcile any
      inconsistency in this Plan;                                                                                                           
| |     |                                                                                                                                                                                                      
| | (e) | grant Options under this Plan;                                                                                                                                                                       
| |     |                                                                                                                                                                                                      
| | (f) | determine the individuals to whom Options shall be
      granted under this Plan and whether the Option is granted as an Incentive
      Stock Option or a Non-Qualified Stock Option;               
| |     |                                                                                                                                                                                                      
| | (g) | determine the time or times at which Options shall be
      granted under this Plan;                                                                                                                 
| |     |                                                                                                                                                                                                      
| | (h) | determine the number of Common Shares subject to each
      Option, the exercise price of each Option, the duration of each Option and
      the times at which each Option shall become exercisable;
| |     |                                                                                                                                                                                                      
| | (i) | determine all other terms and conditions of the Options;
      and                                                                                                                                   
| |     |                                                                                                                                                                                                      
| | (j) | make all other determinations and interpretations
      necessary and advisable for the administration of the
  Plan.                                                                                

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

3.           
ELIGIBILITY

3.1****
Incentive Stock Options may be granted to any individual who, at the time the
Option is granted, is an employee of the Company or any Related Corporation (as
defined in Section 3.5 hereof) ("Employees").

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

3.3 ****Options may be granted in substitution for outstanding Options of
another corporation in connection with the merger, consolidation, acquisition of
property or stock or other reorganization between such other corporation and the
Company or any subsidiary of the Company. Options also may be granted in
exchange for outstanding Options.

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

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

4.          
 STOCK

4.1 ****The Plan Administrator is authorized to grant Options to acquire, in
aggregate, up to a total of 10% of the issued and outstanding Common Shares from
time to time (the "Option Limit"). The number of Common Shares with
respect to which Options may be granted hereunder is subject to adjustment as
set out in Section 5.1(m) hereof. In the event that any outstanding Option
expires or is terminated for any reason, the Common Shares allocable to the
unexercised portion of such Option may again be subject to an Option granted to
the same Optionee or to a different person eligible under Section 3 hereof;
provided however, that any cancelled Options will be counted against the maximum
number of shares with respect to which Options may be granted to any particular
person as set out in Section 5.1(a) hereof.

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5.          
 TERMS AND CONDITIONS OF OPTIONS

5.1****
Each Option granted under this Plan shall be evidenced by an option certificate
in substantially the form attached hereto as Schedule "A" or such written
agreement as may be approved by the Plan Administrator from time to time (each,
an "Agreement"). Agreements may contain such provisions, not inconsistent
with this Plan or any Applicable Laws, as the Plan Administrator in its
discretion may deem advisable. All Options also shall comply with the following
requirements:

(a)         
Number of Shares and Type of Option

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

| | (i)   | subject to the Option Limit set out in Section 4.1
      hereof, the number of Common Shares that may be reserved pursuant to the
      exercise of Options granted to any person shall not exceed 10% of the
      issued and outstanding Common Shares of the Company;                                                                                                                                                                                                                                                                                                                  
| | ----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | (ii)  | in the absence of action to the contrary by the Plan
      Administrator in connection with the grant of an Option, all Options shall
      be Non-Qualified Stock Options;                                                                                                                                                                                                                                                                                                                                                                                                               
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | (iii) | the aggregate fair market value (determined at the Date
      of Grant, as defined in Section 5.1(b) hereof) of the Common Shares with
      respect to which Incentive Stock Options are exercisable for the first
      time by the Optionee during any calendar year (granted under this Plan and
      all other Incentive Stock Option plans of the Company, a Related
      Corporation or a predecessor corporation) shall not exceed US$100,000, or
      such other limit as may be prescribed by the Code as it may be amended
      from time to time (the "Annual Limit"); and
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | (iv)  | any portion of an Option which exceeds the Annual Limit
      shall not be void but rather shall be a Non-Qualified Stock
  Option.                                                                                                                                                                                                                                                                                                                                                                                                                                                       

(b)         
Date of Grant

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

(c)         
Option Price

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

| | (i)   | the per share exercise price for an Incentive Stock
      Option or any Option granted to a "covered employee" as such term
      is defined for purposes of Section 162(m) of the Code shall not be less
      than the fair market value per Common Share at the Date of Grant as
      determined by the Plan Administrator in good faith;                                                                                       
| | ----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | (ii)  | with respect to Incentive Stock Options granted to
      greater-than-ten percent (>10%) shareholders of the Company (as
      determined with reference to Section 424(d) of the Code), the exercise
      price per share shall not be less than one hundred ten percent (110%) of
      the fair market value per Common Share at the Date of Grant as determined
      by the Plan Administrator in good faith; and             
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | (iii) | Options granted in substitution for outstanding options
      of another corporation in connection with the merger, consolidation,
      acquisition of property or stock or other reorganization involving such
      other corporation and the Company or any subsidiary of the Company may be
      granted with an exercise price equal to the exercise price for the
      substituted option of the other corporation,
subject

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to any adjustment consistent with the
terms of the transaction pursuant to which the substitution is to occur, and
provided that for Incentive Stock Options:

| | A. | the excess of the aggregate fair market value of the
      shares subject to the option immediately after the substitution over the
      aggregate exercise price of such shares is not more than the excess of the
      aggregate fair market value of all shares subject to the option
      immediately before such substitution over the aggregate exercise price of
      such shares, and
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                  
| | B. | the substituted option does not give the employee
      additional benefits which he did not have under the previously held
      Option; and                                                                                                                                                                                                                                                    

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

(d)         
Duration of Options

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

(e)         
Vesting Schedule

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

Number of Months Following Date of
      Grant
    Percentage of Total Option
      VestedAt grant date
    25%6
    50%12
    75%18
    100%


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

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- 5 -

(f)         
Acceleration of Vesting

The vesting of one or more outstanding Options may be
accelerated by the Plan Administrator at such times and in such amounts as it
shall determine in its sole discretion.

(g)         
Term of Option

| | (i)   | Vested Options shall terminate, to the extent not
      previously exercised, upon the occurrence of the first of the following
      events:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | ----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |       | A.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |       | B.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |       | C.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |       | D.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | (ii)  | Notwithstanding Section 5.1(g)(i) hereof, any vested
      Options which have been granted to the Optionee in the Optionee's capacity
      as a director of the Company or any Related Corporation shall terminate
      upon the occurrence of the first of the following events:                                                                                                                                                                                                                                                                                                                                                                                                                             
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |       | A.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |       | B.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |       | C.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | (iii) | Upon the death of an Optionee, any vested Options held by
      the Optionee shall be exercisable only by the person or persons to whom
      such Optionee's rights under such Option shall pass by the Optionee's will
      or by the laws of descent and distribution of the Optionee's domicile at
      the time of death and only until such Options terminate as set out
      above.                                                                                                                                                                                                                                                                                                                   
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | (iv)  | For purposes of the Plan, unless otherwise defined in the
      Agreement, "Disability" shall mean medically determinable physical
      or mental impairment which has lasted or can be expected to last for a
      continuous period of not less than twelve months or that can be expected
      to result in death. The Plan Administrator shall determine whether an
      Optionee has incurred a Disability on the basis of medical evidence
      acceptable to the Plan Administrator. Upon making a determination of
      Disability, the Plan Administrator shall, for purposes of the Plan,
      determine the date of an Optionee's termination of employment or
      contractual relationship.
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | (v)   | Unless accelerated in accordance with Section 5.1(f)
      hereof, unvested Options shall terminate immediately upon termination of
      employment of the Optionee by the Company for any reason whatsoever,
      including death or Disability.                                                                                                                                                                                                                                                                                                                                                                                                                                                             

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

(h)         
Exercise of Options

| | (i)  | Options shall be exercisable, in full or in part, at any
      time after vesting, until termination. If less than all of the Common
      Shares included in the vested portion of any Option are purchased, the
      remainder may be purchased at any subsequent time prior to the expiration
      of the Option term. Only whole Common Shares may be issued pursuant to an
      Option, and to the extent that an Option covers less than one (1) share,
      it is unexercisable.                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | ---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | (ii) | Options or portions thereof may be exercised by giving
      written notice, in substantially the form of notice attached as
      Schedule "B"hereto, to the Company and be accompanied by payment
      in the amount of the aggregate exercise price for the Common Shares so
      purchased, which payment shall be in the form specified in Section 5.1(i)
      hereof. The Company shall not be obligated to issue, transfer or deliver a
      certificate representing Common Shares to the Holder of any Option, until
      provision has been made by the Holder, to the satisfaction of the Company,
      for the payment of the aggregate exercise price for all Common Shares for
      which the Option shall have been exercised and for satisfaction of any tax
      withholding obligations associated with such exercise. During the lifetime
      of an Optionee, Options are exercisable only by the
  Optionee.

(i)         
Payment upon Exercise of Option

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

| | (i)  | by delivering a properly executed exercise notice
      together with irrevocable instructions to a broker promptly to sell or
      margin a sufficient portion of the Common Shares and deliver directly to
      the Company the amount of sale or margin loan proceeds to pay the exercise
      price; or
| | ---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |      |                                                                                                                                                                                                                                                                                                               
| | (ii) | by complying with any other payment mechanism approved by
      the Plan Administrator at the time of exercise.                                                                                                                                                                                               

(j)          No
Rights as a Shareholder

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

(k)         
Non-transferability of Options

| | (i) | Options granted under this Plan and the rights and
      privileges conferred by this Plan may not be transferred, assigned,
      pledged or hypothecated in any manner (whether by operation of law or
      otherwise) other than by will or by applicable laws of descent and
      distribution or, in the case of a
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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Non-Qualified Stock Option, pursuant
to a qualified domestic relations order, and shall not be subject to execution,
attachment or similar process; provided however that, subject to applicable
laws:

| | A. | for Non-Qualified Stock Options, any Agreement may
      provide or be amended to provide that a Non-Qualified Stock Option to
      which it relates is transferable without payment of consideration to
      immediate family members of the Optionee or to trusts or partnerships or
      limited liability companies established exclusively for the benefit of the
      Optionee and the Optionee's immediate family members; and
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | B. | for all Options, the Optionee's heirs or administrators
      may exercise any portion of the outstanding Options within one year of the
      Optionee's death.                                                                                                                                                                                                                                                                         

| | (ii) | Upon any attempt to transfer, assign, pledge, hypothecate
      or otherwise dispose of any Option or of any right or privilege conferred
      by this Plan contrary to the provisions hereof, or upon the sale, levy or
      any attachment or similar process upon the rights and privileges conferred
      by this Plan, such Option shall thereupon terminate and become null and
      void.
| | ---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

(l)         
Securities Regulation and Tax Withholding

| | (i)   | Common Shares shall not be issued with respect to an
      Option unless the exercise of such Option and the issuance and delivery of
      such Common Shares shall comply with all Applicable Laws, and such
      issuance shall be further subject to the approval of counsel for the
      Company with respect to such compliance, including the availability of an
      exemption from prospectus and registration requirements for the issuance
      and sale of such Common Shares. The inability of the Company to obtain
      from any regulatory body the authority deemed by the Company to be
      necessary for the lawful issuance and sale of any Common Shares under this
      Plan, or the unavailability of an exemption from prospectus and
      registration requirements for the issuance and sale of any Common Shares
      under this Plan, shall relieve the Company of any liability with respect
      to the non-issuance or sale of such Common Shares.                                                                                                                                                                                                                        
| | ----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | (ii)  | As a condition to the exercise of an Option, the Plan
      Administrator may require the Holder to represent and warrant in writing
      at the time of such exercise that the Common Shares are being purchased
      only for investment and without any then-present intention to sell or
      distribute such Common Shares. If necessary under Applicable Laws, the
      Plan Administrator may cause a stop- transfer order against such Common
      Shares to be placed on the stock books and records of the Company, and a
      legend indicating that the Common Shares may not be pledged, sold or
      otherwise transferred unless an opinion of counsel is provided stating
      that such transfer is not in violation of any Applicable Laws, may be
      stamped on the certificates representing such Common Shares in order to
      assure an exemption from registration. The Plan Administrator also may
      require such other documentation as may from time to time be necessary to
      comply with applicable securities laws. THE CORPORATION HAS NO OBLIGATION
      TO UNDERTAKE REGISTRATION OF OPTIONS OR THE COMMON SHARES ISSUABLE UPON
      THE EXERCISE OF OPTIONS.
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | (iii) | The Holder shall pay to the Company by certified or
      cashier's check, promptly upon exercise of an Option or, if later, the
      date that the amount of such obligations becomes determinable, all
      applicable federal, state, local and foreign withholding taxes that the
      Plan Administrator, in its discretion, determines to result upon exercise
      of an Option or from a transfer or other disposition of Common Shares
      acquired upon exercise of an Option or otherwise related to an Option or
      Common Shares acquired in connection with an Option. Upon approval of the
      Plan Administrator, a Holder may satisfy such obligation by complying with
      one or more of the following alternatives selected by the Plan
      Administrator:                                                                                                                                                                                                                                                                                                                                                                                                                       
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |       | A.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  

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- 8 -

| |    | the date of exercise (as determined by the Plan
      Administrator) equal to any withholding tax obligations arising as a
      result of such exercise, transfer or other disposition; or
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                            
| | B. | by complying with any other payment mechanism approved by
      the Plan Administrator from time to time.                                                                                  

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

(m)         
Adjustments Upon Changes In Capitalization

| | (i)   | The aggregate number and class of shares for which
      Options may be granted under this Plan, the number and class of shares
      covered by each outstanding Option, and the exercise price per share
      thereof (but not the total price), and each such Option, shall all be
      proportionately adjusted for any increase or decrease in the number of
      issued Common Shares of the Company resulting from:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | ----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| |       | A.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| |       | B.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | (ii)  | Except as provided in Section 5.1(m)(iii) hereof, upon a
      merger (other than a merger of the Company in which the holders of Common
      Shares immediately prior to the merger have the same proportionate
      ownership of common shares in the surviving corporation immediately after
      the merger), consolidation, acquisition of property or stock, separation,
      reorganization (other than a mere re-incorporation or the creation of a
      holding Company) or liquidation of the Company, as a result of which the
      shareholders of the Company, receive cash, shares or other property in
      exchange for or in connection with their Common Shares, any Option granted
      hereunder shall terminate, but the Holder shall have the right to exercise
      such Holder's Option immediately prior to any such merger, consolidation,
      acquisition of property or shares, separation, reorganization or
      liquidation, and to be treated as a shareholder of record for the purposes
      thereof, to the extent the vesting requirements set out in the Option
      agreement have been satisfied.                                                                                                                                                                                                                                                                                                                                                                                                                               
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | (iii) | If the shareholders of the Company receive shares in the
      capital of another corporation ("Exchange Shares") in exchange for
      their Common Shares in any transaction involving a merger (other than a
      merger of the Company in which the holders of Common Shares immediately
      prior to the merger have the same proportionate ownership of Common Shares
      in the surviving corporation immediately after the merger), consolidation,
      acquisition of property or shares, separation or reorganization (other
      than a mere re-incorporation or the creation of a holding Company), all
      Options granted hereunder shall be converted into options to purchase
      Exchange Shares unless the Company and the corporation issuing the
      Exchange Shares, in their sole discretion, determine that any or all such
      Options granted hereunder shall not be converted into options to purchase
      Exchange Shares but instead shall terminate in accordance with, and
      subject to the Holder's right to exercise the Holder's Options pursuant
      to, the provisions of Section 5.1(m)(ii) hereof. The amount and price of
      converted options shall be determined by adjusting the amount and price of
      the Options granted hereunder in the same proportion as used for
      determining the number of Exchange Shares the holders of the Common Shares
      receive in such merger, consolidation, acquisition or property or stock,
      separation or reorganization. Unless accelerated by the
  Board,

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- 9 -

| |      | the vesting schedule set out in the option agreement
      shall continue to apply to the options granted for the Exchange
    Shares.                                                                                                                                                                                                 
| | ---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |      |                                                                                                                                                                                                                                                                                                                                        
| | (iv) | In the event of any adjustment in the number of Common
      Shares covered by any Option, any fractional shares resulting from such
      adjustment shall be disregarded and each such Option shall cover only the
      number of full shares resulting from such adjustment.                                                       
| |      |                                                                                                                                                                                                                                                                                                                                        
| | (v)  | All adjustments pursuant to Section 5.1(m) hereof shall
      be made by the Plan Administrator, and its determination as to what
      adjustments shall be made, and the extent thereof, shall be final, binding
      and conclusive.                                                                                               
| |      |                                                                                                                                                                                                                                                                                                                                        
| | (vi) | The grant of an Option shall not affect in any way the
      right or power of the Company to make adjustments, reclassifications,
      reorganizations or changes of its capital or business structure, to merge,
      consolidate or dissolve, to liquidate or to sell or transfer all or any
      part of its business or assets.

6.           
EFFECTIVE DATE; AMENDMENT; SHAREHOLDER APPROVAL

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

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

6.3 ****Any Incentive Stock Options granted by the Plan Administrator prior to
the ratification of this Plan by the shareholders of the Company shall be
granted subject to approval of this Plan by the holders of a majority of the
Company's outstanding voting shares, voting either in person or by proxy at a
duly held shareholders' meeting within twelve months before or after the
Effective Date. If such shareholder approval is sought and not obtained, all
Incentive Stock Options granted prior thereto and thereafter shall be considered
Non-Qualified Stock Options and any Options granted to Covered Employees will
not be eligible for the exclusion set out in Section 162(m) of the Code with
respect to the deductibility by the Company of certain compensation.

7.           
NO OBLIGATIONS TO EXERCISE OPTION

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

8.           
NO RIGHT TO OPTIONS OR TO EMPLOYMENT

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

9.           
APPLICATION OF FUNDS

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

10.        
 INDEMNIFICATION OF PLAN ADMINISTRATOR

10.1****
In addition to all other rights of indemnification they may have as members of
the Board, members of the Plan Administrator shall be indemnified by the Company
for all reasonable expenses and liabilities of any type or

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- 10 -

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

11.         
AMENDMENT OF PLAN

11.1 ****The Plan Administrator may, at any time, modify, amend or terminate
this Plan or modify or amend Options granted under this Plan, including, without
limitation, such modifications or amendments as are necessary to maintain
compliance with the Applicable Laws. The Plan Administrator may condition the
effectiveness of any such amendment on the receipt of shareholder approval at
such time and in such manner as the Plan Administrator may consider necessary
for the Company to comply with or to avail the Company and/or the Optionees of
the benefits of any securities, tax, market listing or other administrative or
regulatory requirements.

---

SCHEDULE "A"

CROWN OIL AND GAS INC.

Stock Option PlanOption
Certificate

This Certificate is issued pursuant to the provisions of the
stock option plan of CROWN OIL AND GAS INC. (the "Company") dated May 30, 2008
(the "Plan") and evidences that ____________________ is the holder of a
stock option (the "Option") to purchase up to ____________________ shares
in the common stock of the Company (the "Common Shares") at a purchase
price of US$__________ per Common Share. (the "Exercise Price"). Subject
to the provisions of the Plan:

| | (a) | the Option is intended to be [an Incentive Stock
      Option] OR [a Non-Qualified Stock Option] [Pick one]within the
      meaning of Section 422 of the Internal Revenue Code of 1986(United
      States), as amended ;
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                           
| | (b) | the award date of this Option is ____________________
      (the "Award Date"); and                                                                                                                                       
| |     |                                                                                                                                                                                                                           
| | (c) | the expiry date of this Option is ____________________
      (the "Expiry Date").                                                                                                                                         

The right to purchase Common Shares under the Option will vest
in the holder in increments over the term of the Option as follows:

Date
    Cumulative Number of Common
      Shares which may be Purchased


This Option may be exercised in accordance with its terms at
any time and from time to time from and including the Award Date through to and
including up to 5:00 p.m. (Seattle, Washington time) on the Expiry Date, by
delivery to the Administrator of the Plan an exercise notice, in the form
provided in the Plan, together with this Certificate and a certified cheque or
bank draft payable to CROWN OIL AND GAS INC. in an amount equal to the aggregate
of the Exercise Price of the Shares in respect of which this Option is being
exercised.

This Certificate and the Option evidenced hereby are not
assignable, transferable or negotiable and are subject to the detailed terms and
conditions contained in the Plan. This Certificate is issued for convenience
only and in the case of any dispute with regard to any matter in respect hereof,
the provisions of the Plan and the records of the Company shall prevail.

The foregoing Option has been awarded this ______ day of
_______________________.

CROWN OIL AND GAS INC.

Per: 
__________________________________________

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SCHEDULE "B"

CROWN OIL AND GAS INC.

Stock Option PlanExercise Notice

|TO: | The Administrator, Stock Option
      Plan
|--- | ------------------------------------------
|    | Crown Oil and Gas Inc.                    
|    | 400 - 225 West
      Magnolia Street      
|    | Bellingham, WA 98225                      

The undersigned hereby irrevocably gives notice, pursuant to
the terms of the stock option plan of CROWN OIL AND GAS INC (the "Company")
dated May 30, 2008 (the "Plan"), of the exercise of certain stock options
granted under the Plan to acquire, and hereby subscribes for, the following
shares in the common stock of the Company (the "Common Shares") (strike
out the inapplicable item):

| | (a) | all of the Common Shares which are set out in the option
      certificate attached hereto ; OR             
| | --- | ------------------------------------------------------------------------------------------------------------
| |     |                                                                                                             
| | (b) | of the Common Shares which are set out in the certificate
      attached hereto, _____________ Common Shares

CALCULATION OF TOTAL EXERCISE PRICE:

| | Number of Common Shares to be acquired on exercise:    |     | __________________Common Shares
| | ------------------------------------------------------ | --- | -------------------------------
| |                                                        |     |                                
| | MULTIPLIED BY the Exercise Price per Common Share:     | US$ |                                
| |                                                        |     |                                
| | EQUALS the total Exercise Price, as enclosed herewith: | US$ |                                

If the undersigned is a "U.S. person", as such term is defined
in Regulation S under the United States Securities Act of 1933 (the
"Securities Act"), the undersigned represents and warrants to the Company
that, at the time of the exercise of the Option, the undersigned is an
"accredited investor", as such term defined in Regulation D under the Securities
Act.

The undersigned tenders herewith a cheque or bank draft (circle
one) in the amount of US$____________, payable to CROWN OIL AND GAS INC. in an
amount equal to the total Exercise Price of the Common Shares, as calculated
above, and directs the Company to issue, register and deliver the certificates
representing the Common Shares as follows:

|Registration Information:            |  | Delivery Instructions:
|------------------------------------ |  | ----------------------
|                                     |  |                       
|                                     |  |                       
|Name to appear on
      certificates |  | Name                  
|                                     |  |                       
|                                     |  |                       
|Address                              |  | Address               
|                                     |  |                       
|                                     |  |                       
|                                     |  |                       
|                                     |  |                       
|                                     |  | Telephone Number      

All capitalized terms, unless otherwise defined in this
exercise notice, will have the meaning provided in the Plan.

DATED the ______ day of _______________________.

|                        |  |                              
|----------------------- |  | -----------------------------
|Witness                 |  | Signature of Option Holder   
|                        |  |                              
|                        |  |                              
|Name of Witness (Print) |  | Name of Option Holder (Print)
|                        |  |                              
|                        |  |                              
|                        |  | (Fax Number)                 

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