NON-STATUTORY STOCK OPTION AGREEMENT

THIS NON-STATUTORY STOCK OPTION AGREEMENT (“ Agreement ”) is entered into effective as of May 22, 2009 (“ Effective Date ”) by and between Petro Resources Corporation, a Delaware corporation (“ Company ”), and Gary C. Evans (“ Optionee ”).

B.  The options and option shares will not be granted under the Company’s 2006 Stock Incentive Plan (“ Plan ”), however, as a matter of convenience, this Agreement incorporates certain terms and conditions from the Plan, as it exists as of the Effective Date, as expressly provided for herein.

C.  This Agreement is entered into concurrent with the execution and delivery of that certain Employment Agreement (“ Employment Agreement ”) of even date herewith between Optionee and the Company.

It is hereby agreed as follows:

1.  Grant of Options .  The Company hereby grants to Optionee, options (“ Options ”) to purchase all or any part of 2,750,000 shares (“ Shares ”) of the Corporation’s Common Stock, upon the terms and subject to the conditions set forth herein.  Except as otherwise determined by the board of directors (“ Board ”) of the Company, this Agreement and the Options granted hereby shall be administered on behalf of the Company by the Compensation and Nominating Committee (“ Committee ”) of the Board. All agreements, notices and waivers to be made by, or delivered to, the Company under this Agreement shall be made by, or delivered to, the Committee, except as otherwise determined by the Board.

2.  Option Period .  The Options shall vest and become exercisable, unless earlier terminated pursuant to Section 6 of this Agreement, as set forth in this Section 2.  All outstanding Options shall expire on May 22, 2014.

(a)  Options to purchase 687,500 Shares shall vest and first become exercisable subject to and upon the Company’s acquisition of at least $20 million of additional debt capital, equity capital, or oil and gas properties, or any combination thereof, whether in one transaction or in a series of transactions, during the period commencing on the Effective Date and ending on  May 22, 2010.  Recapitalization of existing equity and refinancing of existing debt shall be excluded from the calculation of acquired capital.  In the case of credit facilities, (i) all draw downs on the credit facilities of the Company or its subsidiaries existing as of the Effective Date shall be excluded from calculation of acquired debt capital, (ii) the initiation of a new credit facility on the part of the Company or its subsidiaries subsequent to the Effective Date or any increase in the borrowing amount of a credit facility existing as of the Effective Date (each a “ New Credit Facility ”), shall be excluded from calculation of acquired debt capital and (iii) all draw downs on a New Credit Facility shall be included in calculation of acquired debt capital.  In the case of acquisitions of oil and gas properties, the purchase price paid by the Company for the oil and gas properties shall be used for purposes of this Section 2(a) and any financing acquired by the Company for purposes of financing the acquisition shall be excluded from any calculation of acquired capital pursuant to this Section 2(a).

(b)  Options to purchase 687,500 Shares shall vest and first become exercisable subject to and upon the Common Stock trading at a VWAP (as defined below) of $0.75 per share (as adjusted for splits, combinations and the like) for 20 of any 30 consecutive trading days during the period commencing on the Effective Date and ending on May 22, 2011. The term “ VWAP ” means, for any date, the price determined by the first of the following clauses that applies: (i) if the Common Stock is then listed or quoted on a stock market or stock exchange other than the OTC Bulletin Board, the daily volume weighted average price of the Common Stock for such date (or the nearest preceding date) on the trading market on which the Common Stock is then listed or quoted for trading as reported by Bloomberg Financial L.P. (based on a trading day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time); (ii) if the OTC Bulletin Board is the trading market, the volume weighted average price of the Common Stock for such date (or the nearest preceding date) on the OTC Bulletin Board; (iii) if the Common Stock is not then quoted for trading on the OTC Bulletin Board and if prices for the Common Stock are then reported in the “Pink Sheets” published by Pink Sheets, LLC (or a similar organization or agency succeeding to its functions of reporting prices), the most recent bid price per share of the Common Stock so reported; or (iv) in all other cases, the fair market value of a share of Common Stock as determined by the Board in good faith.

(c)  Options to purchase 687,500 Shares shall vest and first become exercisable subject to and upon the Common Stock trading at a VWAP of $1.25 per share (as adjusted for splits, combinations and the like) for 20 of any 30 consecutive trading days during the period commencing on the Effective Date and ending on May 22, 2012.

(d)  Options to purchase 687,500 Shares shall vest and first become exercisable subject to and upon the Company achieving daily production of 1,400 boe per day during the period commencing on the Effective Date and ending on May 22, 2011. The term “ boe ” means barrels of crude oil equivalent, determined using the ratio of six mcf of natural gas to one bbl of crude oil, condensate or natural gas liquids.

3.  Method of Exercise .  The Options shall be exercisable by Optionee by giving written notice to the Company of the election to purchase and of the number of Shares Optionee elects to purchase, such notice to be accompanied by such other executed instruments or documents as required by this Agreement or as the Company may otherwise reasonably require, and unless otherwise directed by the Company, Optionee shall at the time of such exercise tender the purchase price of the Shares he has elected to purchase.  Optionee may purchase less than the total number of Shares for which the Option is exercisable, provided that a partial exercise of an Option may not be for less than 100 Shares.  If Optionee shall not purchase all of the Shares which he is entitled to purchase under the Options, his right to purchase the remaining unpurchased Shares shall continue until expiration of the Options.  The Options shall be exercisable with respect of whole Shares only, and fractional Share interests shall be disregarded.

4.  Amount of Purchase Price .  The purchase price (“ Purchase Price ”) per Share for each Share which Optionee is entitled to purchase under the Options shall be $0.37 per Share.

5.  Payment of Purchase Price .  At the option of the Executive, all or any part of the Options may be paid in cash or in shares of Common Stock equal to the Purchase Price, or in a combination of cash and shares of the Common Stock of the Company.  At the time of Optionee’s notice of exercise of the Options, Optionee shall designate the manner of payment and shall tender (a) in cash or by certified or bank cashier’s check payable to the Company, the Purchase Price for all Shares then being purchased for cash, and (b) shares of Common Stock of the Company for the Purchase Price for all Shares then being purchased not involving a cash payment, accompanied by appropriate stock powers with original signatures and Medallion guarantees.  In the case of payment in shares of Common Stock, the per share value shall be the VWAP for the 20 trading days preceding the Company’s receipt of the notice of exercise and other deliverables required by this Section 5.

6.  Effect of Termination of Employment or Other Relationship .  If Optionee’s employment with the Company terminates, the effect of the termination on the Optionee’s rights to acquire Shares shall be as follows:

6.1  Termination Due to Death or Disability .  In the event Optionee’s employment with the Company is terminated by reason of death or Disability (as such term is defined in the Employment Agreement), all outstanding Options then held by Optionee will, to the extent exercisable as of such termination, remain exercisable for a period of six (6) months after such termination (but in no event after the expiration date of any such Option).  Options not exercisable as of such death or Disability will be forfeited and terminate.

6.2  Termination Due to Resignation .  In the event Optionee’s employment with the Company is terminated by reason of resignation by Optionee, excluding any resignation by Optionee for Good Reason (as such term is defined in the Employment Agreement), all outstanding Options then held by Optionee will, to the extent exercisable as of such termination, remain exercisable in full for a period of three (3) months after such termination (but in no event after the expiration date of any such Option).  Options not exercisable as of such resignation will be forfeited and terminate.

6.3  Termination For Cause.   In the event Optionee’s employment with the Company is terminated by the Company for Cause (as such term is defined in the Employment Agreement), all outstanding Options then held by Optionee will be forfeited and terminate, without notice of any kind, effective as of the time of termination for Cause. The Company may defer the exercise of any Option for a period of up to forty-five (45) days in order for the Committee to make any determination as to the existence of Cause.

6.4    Termination for Reasons Other than Death, Disability, Resignation or Cause.   In the event Optionee’s employment with the Company is terminated for any reason other than as contemplated by Sections 6.1 through 6.3 above, all outstanding Options then held by Optionee will, to the extent exercisable as of such termination, remain exercisable in full until the expiration date of any such Option.  Options not exercisable as of such termination of employment shall remain outstanding and will be forfeited and terminate on the earlier of (a) the vesting date with respect to such Options set forth in Section 2 if the applicable vesting condition has not been satisfied on or prior to such date and (b) either (y)  the second anniversary of the date of such termination of employment in the event  such termination of employment occurs on or before the first anniversary of the Effective Date or (z) the first anniversary of the date of such termination of employment in the event  such termination of employment occurs aft