Document:

THIS OPTION AGREEMENT MADE THE 17TH DAY OF FEBRUARY 2006

BETWEEN:

               VINECREST MANAGEMENT SERVICES LIMITED,
               A COMPANY INCORPORATED UNDER THE LAWS OF THE PROVINCE OF ONTARIO,

                        HEREINAFTER REFERRED TO AS "VINECREST" OR "THE OPTIONOR"
                                                               OF THE FIRST PART

AND:

              GRAPHITE TECHNOLOGY GROUP INC.,
              A CORPORATION INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE

                                HEREINAFTER REFERRED TO AS "GRAPHITE TECHNOLOGY"
                                            OR IN THE ALTERNATIVE "THE OPTIONEE"
                                                              OF THE SECOND PART

         WHEREAS Vinecrest represents to Graphite Technology that it is the
owner and has exclusive right to deal with and dispose of, free of any and all
agreements and encumbrances of any nature or kind whatsoever, a One Hundred
Percent (100%) interest in Four (4) Mining Claims ("the Mining Properties")
situated in Butt Township, in the Province of Ontario and more particularly
described in Schedule "A" annexed hereto;

         AND WHEREAS Vinecrest wishes to grant Graphite Technology an option to
purchase a One Hundred Percent (100%) interest in and certain rights to prospect
and examine the Mining Properties subject to the terms and conditions and
Royalties hereinafter set out;

         THEREFORE, this Agreement witness that in consideration of the premises
and Ten Thousand dollars ($10,000.00) in the lawful money of Canada now paid to
Vinecrest by Graphite Technology (the receipt and sufficiency of which is hereby
acknowledged), and the mutual covenants and the Agreements hereinafter contained
the parties hereto agree as follows:

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                                       2

ARTICLE 1 - REPRESENTATION AND SCHEDULES PART OF AGREEMENT

1.01     The representations of Vinecrest hereinbefore and hereinafter set out
         shall form part of the Agreement and are conditions upon which Graphite
         Technology has relied on and entering into this Agreement and are to be
         construed as both conditions and warranties. In addition, Schedule "A"
         shall be an applicable and form part of this Agreement.

ARTICLE 2 - PURCHASE OPTION AND TERMS:

2.01     Vinecrest hereby gives and grants to Graphite Technology the sole and
         exclusive right and option (hereinafter called the "Purchase Option")
         to purchase from the Vinecrest all its right, title and interest in and
         to the Mining Properties free and clear of all encumbrances, but
         subject to the Royalties and Minimum Royalties as hereinafter set out,
         for an aggregate consideration of One Hundred and Fifty Thousand
         dollars ($150,000.00).

2.02     Subject to prior termination pursuant to the provisions of this
         Agreement, the Purchase Option shall remain in full force and effect up
         to and including the 31st day of December 2008 provided the sum of One
         Hundred and Fifty Thousand dollars ($150,000.00) paid in the following
         amounts on or before the dates hereinafter set out:

         (a)      Upon the signing of this Agreement Graphite Technology pays
                  Vinecrest the sum of Ten Thousand dollars ($10,000.00), the
                  Purchase Option shall continue in full force and effect up to
                  and including the 30th day of June 2006;

         (b)      Provided Graphite Technology pays Vinecrest a further sum of
                  Fifteen Thousand dollars ($15,000.00) on or before the 30th
                  day of June 2006 the Purchase Option shall continue in full
                  force and effect up to and including the 31st day of December
                  2006;

         (c)      Provided Graphite Technology pays Vinecrest a further sum of
                  Twenty-Five Thousand dollars ($25,000.00) on or before the
                  31st day of December 2006 the Purchase Option shall continue
                  in full force and effect up to and including the 30th day of
                  June 2007;

         (d)      Provided Graphite Technology pays Vinecrest a further sum of
                  Twenty-Five Thousand dollars ($25,000.00) on or before the
                  30th day of June 2007 the Purchase Option shall continue in
                  full force and effect to and including the 31st day of
                  December 2007;

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                                       3

         (e)      Provided Graphite Technology pays to Vinecrest a further sum
                  of Twenty-Five Thousand dollars ($25,000.00) on or before the
                  31st day of December 2007 the Purchase Option shall continue
                  in full force and effect up to and including the 30th day of
                  June 2008;

         (f)      Provided Graphite Technology pays to Vinecrest the further sum
                  of Twenty-Five Thousand dollars ($25,000.00) on or before the
                  30th day of June 2008 the Purchase Option shall continue in
                  full force and effect up to and including the 31st day of
                  December 2008;

         (g)      Provided Graphite Technology pays to Vinecrest the further sum
                  of Twenty-Five Thousand dollars ($25,000.00) on or before the
                  31st day pf December 2008 the Purchase Option shall be deemed
                  to be fully paid for and exercised.

2.03     In the event that Graphite Technology fails to pay any of the amounts
         specified above on or before the dates set out, this Option Agreement
         shall be at an end and any monies already paid shall be forfeit to
         Vinecrest and Vinecrest shall be under no obligation to Graphite
         Technology nor shall Graphite Technology have any further or other
         claim against the Mining Properties, but shall still be required to
         complete its obligations to Vinecrest hereinafter set out respecting
         the termination of this Agreement.

ARTICLE 3 - EXERCISE OF PURCHASE OPTION:

3.01      Graphite Technology may at any time, while the Purchase Option
          Agreement is in full force and effect, exercise the Purchase Option by
          delivering Vinecrest a notice accordingly together with payment of an
          amount equal to the difference between One Hundred and Fifty Thousand
          dollars ($150,000.00) and the aggregate of all monies paid hereunder,
          including without limitation, the Ten Thousand dollars ($10,000.00)
          paid to Vinecrest upon the execution hereof. Upon delivery and payment
          aforesaid, the Purchase Option shall be deemed to be full exercised at
          the date of giving the said notice and Graphite Technology shall
          thereafter hold One Hundred percent (100%) legal and beneficial
          interest in the Mining Properties free of any lien or encumbrance of
          Vinecrest or anyone claiming through Vinecrest, save and except for
          the Royalties hereinafter set out.

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                                       4

ARTICLE 4 - ROYALTY

4.01     Whether or not Graphite Technology exercises the Purchase Option, it
         shall be obligated to pay Vinecrest a Royalty or Minimum Royalty ("the
         Royalty") as follows:

         (a)      Commencing on the 1st day of October 2006, and each full year
                  hereafter that the Mining Properties are subject to the terms
                  and conditions of this Agreement a Royalty, or a minimum
                  annual fixed Royalty in the amount of Twenty Thousand dollars
                  ($20,000.00) is payable hereunder, (subject to the Cost of
                  Living Adjustment clause specified below) and shall be paid by
                  Graphite Technology to Vinecrest. The first Twenty Thousand
                  dollar ($20,000.00) Minimum Royalty payment shall be due and
                  be paid in one installment on or before the 1st day of October
                  2006, not withstanding that a full year has not expired since
                  the execution of this Agreement and thereafter payment shall
                  be made in two equal installments on or before the 1st day of
                  April and October of each and every year;

         (b)      The aforesaid minimum annual fixed Royalty payment shall be
                  adjusted annually in accordance with any rise or fall in the
                  consumer price index ratio for all products for the City of
                  Toronto published or announced by Information Canada or any
                  successor federal government agency. The first adjustment
                  shall be made on the 1st day of October 2007 and a subsequent
                  adjustment shall be made on the 1st day of October each
                  subsequent year thereafter. The annual fixed Minimum Royalty
                  payment for the year commencing on October 1, 2007 and for
                  each subsequent year thereafter, shall be paid in and for the
                  previous year plus or minus the percentage thereof which is
                  equal to the percentage rise or fall of the Consumer Price
                  Index Ratio from the 1st day of October 2006 to the 1st day of
                  October of the particular year for which the fixed Minimum
                  Royalty payment is due. All such calculations or adjustments
                  to the Minimum Royalty shall be based on the Consumer Price
                  Index as of the 1st day of October 2006.

         (c)      In the year in which commercial mining production and products
                  sales begin, and each subsequent year thereafter, the Royalty
                  owing for each such year shall be an amount equal to Two and a
                  half (2.5%) percent of the gross value of Graphite Technology
                  sales of products derived from ore mined on the Mining
                  Properties during in the particular year in question, but
                  always subject to the minimum Royalty adjusted as set out
                  above. In calculating the gross value of Graphite Technology
                  sales of products in any particular year, there shall be no
                  deductions by Graphite Technology for any monies expended in
                  respect to its project on Mining Properties (including capital
                  costs). More particularly, but not so as to limit the
                  generality of the foregoing, there shall be no deduction for
                  Graphite Technology's costs of money, operating costs, taxes
                  payable, mining, processing, upgrading and any other costs
                  relating to its project on the Mining Properties as a whole
                  whether or not such activities are actually carried on or done
                  on the Mining Properties or elsewhere provided that they apply
                  to the ore or materials mined or derived from the Mining
                  Properties.

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                                       5

         (d)      After the initial Minimum Royalty payment of Twenty Thousand
                  dollars ($20,000.00) on the 1st day of October 2006, the
                  Royalty or Minimum Royalty shall be paid in semi-annual
                  installments, the first Royalty payment to be made on the 1st
                  day of April and the 1st day of October in each year
                  commencing on April 1, 2007. In calculating any Royalty
                  payment due hereunder, there shall be no deduction from the
                  Royalty otherwise payable for any Minimum Royalty payments
                  previously paid or made by Graphite Technology to Vinecrest,
                  and for greater clarity, the Royalty, or the minimum Royalty,
                  as the case may be, shall be payable in addition to the monies
                  set out above in respect to Graphite Technology's option of
                  the Mining Properties.

ARTICLE 5 - ASSIGNMENTS
5.01     Graphite Technology shall be at liberty to assign and transfer all its
         rights, title and interest in this Option Agreement provided:

         (a)      Vinecrest is informed and gives its consent thereto, which
                  consent shall not be unreasonably withheld;

         (b)      Graphite Technology provides written confirmation by the
                  Assignee of Graphite Technology that the Assignee shall be
                  bound by this Agreement and that the rights and privileges of
                  Vinecrest hereunder will be followed and respected. Graphite
                  Technology shall remain liable for all its obligations and
                  payments due hereunder to Vinecrest and in the event of
                  default, hereunder Vinecrest may enforce any rights or
                  remedies it may have jointly or severely, as it shall see fit
                  as against both Graphite Technology and the Assignee.

5.02     If Vinecrest formulates the intention to assign the right to receive
         the Royalty, in whole or in part, Vinecrest shall not complete any such
         assignment and no purported assignment shall be valid unless and until
         the Assignee agrees with Graphite Technology and Vinecrest to be bound
         by the provisions hereof as fully as if such Assignee was a signatory
         hereto. The form of such subsistence of such agreement shall be as
         Vinecrest and Graphite Technology may reasonably require.

5.03     Vinecrest shall be at liberty to assign and transfer its right, title
         and interest in this Option Agreement provided;

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                                       6

         (a)      Graphite Technology is first informed and gives it consent
                  thereto, which consent shall not be unreasonably withheld; and

         (b)      Vinecrest shall provide written confirmation by the Assignee
                  of Vinecrest that the rights and privileges of Graphite
                  Technology hereunder will be followed and respected.

ARTICLE 6 - THE RIGHT TO ENTER AND DO WORK

6.01     Vinecrest hereby gives and grants to Graphite Technology, its servants
         and agents during the currency of the Purchase Option and the sole and
         exclusive right:

(a)      To enter in, under or upon the Mining Properties;

(b)      To have exclusive and quiet possession of the Mining Properties;

(c)      To do such prospecting, exploration, development and/or other mining
         work thereon and thereunder as Graphite Technology in its sole
         discretion may consider advisable;

(d)      To enter upon and erect upon the Mining Properties such mining plant,
         buildings, machinery, tools, appliances, and/or equipment as Graphite
         Technology in its sole discretion may consider advisable; and

(e)      To remove from the Mining Properties and dispose or ores, minerals and
         metals, but only for the purpose of making assay and tests, unless the
         Option Price and Royalty payments have been paid in full and the Mining
         Properties have been brought to Lease.

ARTICLE 7 - REPRESENTATIONS, WARRANTIES AND COVENANTS

7.01     Vinecrest hereby represents and warrants to Graphite Technology that:

         (a)      The laws of the Province of Ontario or any other applicable
                  laws with respect to the Mining Properties have been complied
                  with and, without limiting the generality of the foregoing,
                  the Mining Properties have each been properly and duly staked
                  and recorded in accordance with the laws of the said Province;

         (b)      The Mining Properties are in good standing;

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                                       7

         (c)      Graphite Technology may enter in, under or upon the Mining
                  Properties for the purposes of the Agreement and subject to
                  the Mining Act of Ontario and any environmental laws or
                  regulations applicable thereto, extract and dispose of ore, as
                  provided in paragraph 6.01 hereof, without making any payment
                  to, and without accounting to or obtaining the permission of,
                  any person, firm or corporation.

7.02     Vinecrest hereby covenants that:

         (a)      It will not use the name of Graphite Technology or any company
                  associated with Graphite Technology in any document or release
                  made to or available to the public without prior written
                  approval of Graphite Technology;

         (b)      Any information acquired by it hereunder relating to the
                  Mining Properties shall be confidential and shall not be
                  released or communicated to any person firm or corporation
                  while this Agreement is in full force and effect without the
                  prior written approval of Graphite Technology; and

         (c)      For so long as the purchase option is in full force and
                  effect, it will not deal, or attempt to deal with its right,
                  title and interest in and to the Mining Properties in any way
                  that would or might affect the right of Graphite Technology
                  hereunder to purchase a One Hundred percent (100%) interest in
                  the Mining Properties, free and clear of any encumbrance.

7.03     Graphite Technology hereby covenants and agrees for so long as the
         Purchase Option continues in full force and effect:

         (a)      To permit Vinecrest or its duly authorized agents upon
                  reasonable prior notice to Graphite Technology, to have access
                  to the Mining Properties in order to examine any work carried
                  out by or on behalf of Graphite Technology provided, however,
                  that neither Vinecrest nor its agents shall interfere with or
                  obstruct the operation of Graphite Technology, its servants
                  and agents on the Mining Properties, and further provided that
                  Vinecrest agrees to indemnify and save Graphite Technology
                  harmless from all loss or damage of any nature or kind
                  whatsoever in any way referable to the entry of, presence on,
                  or activities of either of Vinecrest or its agents while on
                  the Mining Properties and including, without limiting the
                  generality of the foregoing, bodily injuries or death at any
                  time resulting therefrom and damage to property sustained by
                  any person or persons;

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                                       8

         (b)      To maintain the Mining Properties in good standing while this
                  Agreement is in full force and effect and for a further Twelve
                  (12) months after the termination thereof;

         (c)      To forward Vinecrest one copy of all engineering reports,
                  drawings, surveys, logs and all other data, or working papers
                  relating to the work done on the Mining Properties or on
                  adjoining properties insofar as they relate to the Mining
                  Properties;

         (d)      To permit Vinecrest, its servants or agents access to the
                  books and records of Graphite Technology pertaining to the
                  operation or work on the Mining Properties for the purposes of
                  calculating or verifying the Royalties payable hereunder and
                  compliance with this Agreement, may have such books and
                  records audited by an independent firm or chartered
                  accountants at Vinecrest's costs; and

         (e)      To obtain a Lease of the Mining Properties pursuant to the
                  Mining Act of Ontario within one year of the signing of this
                  Agreement.

ARTICLE 8 - PROTECTION OF GRAPHITE TECHNOLOGY

8.01     Vinecrest will, from time to time, as and when requested by Graphite
         Technology, execute or cause to be executed all further documents and
         instruments which are in the opinion of Graphite Technology reasonably
         necessary to enable Graphite Technology to take advantage of the rights
         given to it in this Agreement.

8.02     Subject to Article 11 of this Option Agreement Vinecrest agrees that
         Graphite Technology may protect its interest in the Mining Properties,
         as the same may be from time to time constituted, by doing either or
         both of the following:

         (a)      It may register this Agreement or a memorandum of this
                  Agreement or any other document or documents which Graphite
                  Technology may consider advisable in order to protect is
                  rights and interest hereunder against the title of the Mining
                  Properties; or

         (b)      It may transfer the Mining Properties into its name or into
                  the name of its nominee or nominees, to be held in trust and
                  to be dealt with only in accordance with the provisions of
                  this agreement.

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ARTICLE 9 - RIGHT TO REMOVE ASSETS

9.01     At any time and from time to time during the currency of the Purchase
         Option and for a period of One Hundred and Eighty (180) days after the
         termination of this Agreement and subject to compliance thereto,
         Graphite Technology may enter upon and remove from the Mining
         Properties nay and all building, plant, machinery, tools, appliances
         and/or equipment brought or erected upon the Mining Properties by
         Graphite Technology. Any such buildings, plant, machinery, tools,
         appliances and/or equipment not so removed within the said period of
         One Hundred and Eighty (180) days shall become the property of
         Vinecrest.

ARTICLE 10 - TERMINATION

10.01    Subject to the provisions of paragraph 7.03(b), 9.01 and 10.03 hereof,
         this Agreement shall terminate and be at an end:

         (a)      If Graphite Technology fails to pay any Option Purchase
                  Installment as set forth in paragraph 2.02 hereof or any
                  Royalty or Minimum Royalty payment as set out in paragraph 4
                  hereof on or before the relevant date therein set forth, then
                  upon the day following such relevant date; or

         (b)      Prior to the exercise of the Purchase Option, upon receipt by
                  Vinecrest of Notice from Graphite Technology that Graphite
                  Technology is terminating the Purchase Option; or

         (c)      If Graphite Technology does not exercise the Purchase Option
                  during the currency thereof, then at the expiry of the
                  purchase option; or

         (d)      If Graphite Technology otherwise fails to comply with this
                  Option Agreement.

10.02    In the event that Graphite Technology fails to complete any obligation
         under this Agreement on or before the dates specified herein, (other
         than the payment of money for which no notice is required) Vinecrest
         shall give Graphite Technology written notice of the same specifying
         the breach and requiring Graphite Technology to remedy the same. In the
         event that Graphite Technology fails to remedy the breach within Sixty
         (60) days of the receipt of the notice relating thereto, then
         Vinecrest, at its option, may declare the Agreement terminated and the
         Agreement thereafter shall be treated as at an end. Notwithstanding
         that the Agreement has been terminated Vinecrest, shall be entitled to
         any Purchase Price installments or Royalty payments due or accruing
         prior to such termination, or the cost of fulfilling any other
         obligation of Graphite Technology set out herein, or any damages or
         other losses resulting from such default and may enforce payment or
         compliance of the same in any way it shall in its sole and absolute
         discretion it considers desirable.

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                                       10

10.03    In the event of any dispute between the parties arising wherein
         Vinecrest asserts that this Agreement is terminated and Graphite
         Technology denies the validity of the alleged termination, Graphite
         Technology's position and all of Graphite Technology's rights given to
         it by this Agreement shall remain preserved and undisturbed until the
         matter is resolved in Court or otherwise, but Graphite Technology will
         forthwith commence an Action in Ontario claiming a declaration or other
         appropriate relief and to pay the disputed amount into Court to the
         credit of such action, otherwise this Agreement shall be terminated and
         at an end.

10.04    Notwithstanding anything to the contrary contained in this Agreement,
         Graphite Technology may at any time or from time to time, either before
         or after exercise of the Purchase Option, terminate this Agreement with
         respect to any or all Mining Claims comprising part of the Mining
         Properties, subject to paragraph 7.03, 9.01 and this Article hereof,
         upon giving notice accordingly to Vinecrest. Forthwith after any such
         termination, such part of the Mining Properties with respect to which
         this Agreement has been terminated shall cease to be part of the Mining
         Properties for the purpose of this Agreement, all obligations of
         Graphite Technology hereunder, including the obligation to pay the
         minimum fixed annual Royalty payment (where the notice has been given
         with respect to all the Mining Claims) shall, subject to this Article
         hereof, thereupon be at an end. The term "Mining Properties" shall mean
         only those parts thereof which are still subject to the provisions of
         this Agreement. Notwithstanding the release of part of the Mining
         Properties only, the Purchase Option Price and the Royalty or Minimum
         Royalty payments hereunder shall not be reduced.

10.05    Upon termination hereof, pursuant to this paragraph 10 or otherwise:

(a)      If Graphite Technology has registered any agreement, memorandum,
         document or documents against the title of the Mining Properties, then
         Graphite Technology shall forthwith for an aggregate consideration of
         $1.00 discharge or release such agreement, memorandum, document or
         documents with respect to the Mining Properties or such of them that
         are no longer subject to the provisions of this Agreement, as the case
         may be; or

(b)      If Graphite Technology has transferred the Mining Properties into its
         name or into the name of its nominee or nominees, then Graphite
         Technology shall forthwith deliver to Vinecrest a duly executed
         transfer of the Mining Properties or such of them as are no longer
         subject to the provisions of this Agreement, as the case may be,
         transferring for an aggregate consideration of $1.00 title thereto to
         Vinecrest or as Vinecrest may otherwise in writing instruct;

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                                       11

(c)      Graphite Technology shall do all things and execute all documents so as
         to maintain the Mining Properties in good standing and to bring the
         same to Lease pursuant to the Mining Act of Ontario within One (1) year
         of the signing of this Agreement;

(d)      Graphite Technology shall no longer have any claim or interest in or as
         against the Mining Properties of any nature or kind whatsoever and any
         monies thereto before paid shall remain the sole property of Vinecrest;

(e)      Graphite Technology shall release all its rights, title or interest in
         the Mining Properties forthwith.

ARTICLE 11 - TITLE

11.01    Title to the Mining Properties shall be transferred to Robert J.
         Bassermann, the solicitor for Vinecrest, who shall hold the same in
         trust for the parties hereto as their interest may appear until the
         following have been completed:

         (a)      That the Option price of One Hundred and Fifty Thousand
                  dollars ($150,000.00) has been paid in full as aforesaid;

         (b)      The claims have been brought to Lease in accordance with the
                  Mining Act of Ontario;

         (c)      All Royalty or Minimum Royalty payments have been paid to
                  date; and

         (d)      Graphite Technology has otherwise complied with this
                  Agreement.

     Upon completion of the above conditions, the Mining Properties shall be
     registered jointly in the name of Vinecrest and Graphite Technology or
     their successors or assigns, as the case may be, together with a copy of
     this Agreement. Thereafter, any Royalty payments due shall be a first
     charge or encumbrance against the Mining Properties and payment thereof may
     be enforced as such in addition to any other remedy, which Vinecrest may
     have.

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ARTICLE 12 - LEGAL AND ACCOUNTING FEES

12.01 Graphite Technology agrees to pay all of Vinecrest's reasonable legal and
accounting fees payable in connection with the negotiation, drafting,
registration and servicing of this Agreement and all other matters relating
thereto

ARTICLE 13 - NOTICE

13.01    Any notice, document or other communication required or permitted by
         this Agreement to be given by a party hereto shall be in writing and is
         sufficiently given if delivered personally, or if sent by prepaid
         ordinary mail, or if transmitting by any form of telecommunication to
         either party to this Agreement as listed below:

                  Graphite Technology Group Inc.
                  106 Lakeside Avenue, P.O. Box 210
                  Delano, PA  18220

                  Vinecrest Management Services Ltd.
                  c/o Robert J. Bassermann
                  214 - 120 Carlton Street
                  Toronto, Ontario
                  M5A 4K2

13.02    Either party may from time to time by notice in writing change its
         address for the purposes of this Article 13.

13.03    Any payment that Graphite Technology may decide to make or cause to be
         made to Vinecrest hereunder shall be deemed to have been well and truly
         made if a cheque payable to Vinecrest in accordance with the provisions
         of paragraph 13.01 hereof, the provisions of which shall apply, Mutatis
         Mutandus, as if such cheque was a notice given hereunder.

ARTICLE 14 - OPTION

14.01    Subject to the provisions hereof specifically to the contrary, this is
         an Option Agreement only and nothing herein contained and no act done
         nor payment made hereunder shall obligate Graphite Technology to do any
         further or other act or acts or to make further payment or payments,
         and in no event shall this Agreement or any act done or any payment
         made be construed as an obligation of Graphite Technology to do or
         perform any work or make any payments or further payments on or with
         respect to the Mining Properties. PROVIDED HOWEVER, notwithstanding
         that the foregoing Graphite Technology undertakes to bring the claims
         to Lease pursuant to the Mining Act of Ontario on or before the 28th
         day of February 2007, in addition, Graphite Technology shall record all
         work done against the said claims and insure that the taxes are paid
         and there is sufficient work done on the claims for Twelve (12) months
         after the termination in order to maintain the same in good standing.

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                                       13

ARTICLE 15 - MINING AND EXPLORATION

15.01    Graphite Technology shall conduct its exploration, mining and other
         activities on the Mining Properties in accordance with good mining and
         exploration practice and to comply with all mining, environmental laws,
         by-laws or regulations of any governmental body having jurisdiction,
         including the closing of any workings and the reclamation of any lands
         where buildings or other mining debris has been dumped or placed
         according to law.

ARTICLE 16 - GENERAL

16.01    Vinecrest and Graphite Technology both agree that either before or
         after termination of this Agreement, they will execute all documents
         and do all acts and things as either of them may reasonably request and
         as may be lawfully within its power to do (other than the payment of
         money) to carry out the provision and/or the intent of this Agreement.

16.02    This Agreement supersedes all prior negotiations and contains the
         entire understanding between the parties hereto and may be modified
         only by instrument in writing signed by the party or parties against
         which the modification is asserted.

16.03    Time shall be of the essence of this Agreement and shall enure to the
         benefit of and be binding upon Vinecrest, its successors and assigns
         and Graphite Technology, its successors and assigns.

16.04    The parties hereto shall execute all documents and further assurances
         and do all things that shall be necessary or desirable.

16.05    Interest shall be payable in any monies outstanding or in default
         pursuant to this Agreement at the rate of Ten (10%) percent per annum.

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                                       14

16.06    This Agreement shall be subject to and he interpreted and administered
         in accordance with the laws of the Province of Ontario and disputes or
         actions commenced in respect thereto shall be in the Province
         aforesaid.

         IN WITNESS WHEREOF the parties hereto have executed this Agreement as
of the date first above written.

                                            )
                                            ) GRAPHITE TECHNOLOGY GROUP INC.
                                            )
                                            )
                                            ) /S/ Harold King
                                            ) ---------------
                                            ) I have authority to bind the
                                            Corporation.
                                            )
                                            ) VINECREST MANAGEMENT SERVICES
                                            ) LTD.
                                            )
                                            )
                                            )
                                            ) /S/ Donna Baxter
                                            ) ----------------
                                            ) I have authority to bind the
                                            Corporation.THIS OPTION AGREEMENT MADE THE 17TH DAY OF FEBRUARY 2006

BETWEEN:

            VINCENT SHEEHAN, OF THE TOWN OF KEARNEY, IN THE PROVINCE OF ONTARIO,

                          HEREINAFTER REFERRED TO AS "SHEEHAN" OR "THE OPTIONOR"
                                                               OF THE FIRST PART

AND:

                                                 GRAPHITE TECHNOLOGY GROUP INC.,
              A CORPORATION INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE

                                HEREINAFTER REFERRED TO AS "GRAPHITE TECHNOLOGY"
                                            OR IN THE ALTERNATIVE "THE OPTIONEE"
                                                              OF THE SECOND PART

         WHEREAS Sheehan represents to Graphite Technology that he is the owner
and has exclusive right to deal with and dispose of, free of any and all
agreements and encumbrances of any nature or kind whatsoever, of Four (4) Leased
Mining Claims (hereinafter referred to as "the Leased Claims"), more
particularly described in Schedule "A" annexed hereto and Eight (8) un-patented
or un-leased Mining Claims (hereinafter referred to as "the Mining Claims"),
more particularly described in Schedule "B" annexed hereto and jointly hereafter
referred to as the "Mining Properties" as situated in the Township of Butt, in
the Province of Ontario, subject only to the interest of International Graphite
Inc.;

         AND WHEREAS the same properties where the subject of an Option
Agreement between the Optionor herein, Vincent Sheehan, and Cal Graphite
Corporation, hereinafter referred to as "Cal Graphite", dated the 28th day of
September 1987 as amended by the Agreement between the parties dated the 29th
day of September 1998 (hereinafter referred to as the "Cal Graphite Option
Agreement");

         AND WHEREAS Cal Graphite did merge with and all its assets where
transferred to International Graphite Inc. (hereinafter referred to as
"International Graphite") including all there right, title and interest in the
said Mining Properties;

<PAGE>
                                       2

         AND WHEREAS International Graphite is in default of its payments and
other obligations under the Option and in particular, is in default in the
amount of On Hundred and Forty-Six Thousand, Two Hundred and Fifty-Six dollars
and Fifty cents ($146,256.50) of the Minimum Royalty payments under the said
Agreement as of October 1, 2005 and Vincent Sheehan is entitled under the terms
of the said Agreement to a return of the claims to him free and clear of all
encumbrances;

         AND WHEREAS Tormont Industries Ltd. has registered a Construction Lien
in the amount of Thirty-nine Thousand and Twenty dollars and Sixty-one cents
($39,020.61) as Instrument No. 383825 on the 17th day of April 2000 and a
Certificate of Action in respect thereto as Instrument No. 385155 on the 20th
day of June 2000 as against the said properties;

         AND WHEREAS Graphite Technology, represents and warrants that it has
entered into an Agreement to take over and assume all the assets and liabilities
of International Graphite including but not restricted to One Hundred and
Forty-six Thousand, Two Hundred and Fifty-six dollars and Fifty cents
($146,256.50) outstanding to Vincent Sheehan under the said Agreements and is or
will be in a position to carry out its obligations under this Agreement;

         AND WHEREAS Sheehan wishes to grant Graphite Technology and Option to
Purchase a One Hundred percent (100%) interest in and certain rights to prospect
and examine the Mining Properties subject to the terms and conditions and the
Royalties set out;

         AND WHEREAS the parties hereto agree to renegotiate the terms and
conditions of the Option Agreement and the Cal Graphite Option Agreement, shall
be null and void upon the execution of this Agreement save and except that the
outstanding Minimum Royalty payments of One Hundred and Forty-six Thousand, Two
Hundred and Fifty-six dollars and Fifty cents ($146,256.50) owing to Sheehan
pursuant thereto as of October 1, 2005 and any other Royalties accruing
thereunder since that date shall remain outstanding, and shall be considered an
unpaid vendor's lien as against the property

         THEREFORE, this Agreement witness that in consideration of the premises
as set out herein and the sum of Fifteen Thousand dollars ($15,000.00) in the
lawful money of Canada now paid to Sheehan by Graphite Technology (the receipt
and sufficiency of which is hereby acknowledged), and the mutual covenants and
the Agreements hereinafter contained the parties hereto agree as follows:

<PAGE>
                                       3

ARTICLE 1 - THE REPRESENTATION AND WARRANTIES OF BOTH SHEEHAN AND GRAPHITE
TECHNOLOGY

1.01     The representations of Sheehan and Graphite Technology hereinbefore and
         hereinafter set out shall form part of this Agreement and are
         conditions upon which Graphite Technology and Sheehan have relied on in
         entering into this Agreement and are construed as both conditions and
         warranties. In addition, Schedule "A" and Schedule "B" shall be
         applicable and form part of this Agreement.

ARTICLE 2 - PURCHASE OPTION AND TERMS:

2.01     Sheehan hereby gives and grants to Graphite Technology the sole and
         exclusive right and option (hereinafter called the "Purchase Option")
         to purchase from the Sheehan all its right, title and interest in and
         to the Mining Properties free and clear of all encumbrances, but
         subject to the Royalties and Minimum Royalties as hereinafter set out
         and the Cal Graphite Option Agreement, for an aggregate consideration
         of One Hundred and Fifty Thousand dollars ($150,000.00).

2.02     Subject to prior termination pursuant to the provisions of this
         Agreement, the Purchase Option shall remain in full force and effect up
         to and including the 31st day of December 2007 provided the sum of One
         Hundred and Fifty Thousand dollars ($150,000.00) paid in the following
         amounts on or before the dates hereinafter set out:

(a)      Upon the signing of this Agreement Graphite Technology pays Sheehan the
         sum of Fifteen Thousand dollars ($15,000.00), the Purchase Option shall
         continue in full force and effect up to and including the 30th day of
         June 2006;

(b)      Provided Graphite Technology pays Sheehan a further sum of Fifteen
         Thousand dollars ($15,000.00) on or before the 30th day of June 2006
         the Purchase Option shall continue in full force and effect up to and
         including the 31st day of December 2006;

(c)      Provided Graphite Technology pays Sheehan a further sum of Forty
         Thousand dollars ($40,000.00) on or before the 31st day of December
         2006 the Purchase Option shall continue in full force and effect up to
         and including the 30th day of June 2007;

(d)      Provided Graphite Technology pays Sheehan a further sum of Forty
         Thousand dollars ($40,000.00) on or before the 30th day of June 2007
         the Purchase Option shall continue in full force and effect to and
         including the 31st day of December 2007;

<PAGE>
                                       4

(e)      Provided Graphite Technology pays to Sheehan the further sum of Forty
         Thousand dollars ($40,000.00) on or before the 31st day of December
         2007 the Purchase Option shall be deemed to be fully paid for and
         exercised.

2.03     In the event that Graphite Technology fails to pay any of the amounts
         specified above on or before the dates set out, this Option Agreement
         shall be at an end and any monies already paid shall be forfeit to
         Sheehan and Sheehan shall be under no obligation to Graphite Technology
         nor shall Graphite Technology have any further or other claim against
         the Mining Properties, but shall still be required to complete its
         obligations to Sheehan hereinafter set out respecting the termination
         of this Agreement and the arrears of Royalties payable pursuant to the
         Cal Graphite Agreement, shall remain outstanding in full.

ARTICLE 3 - EXERCISE OF PURCHASE OPTION:

3.01      Graphite Technology may at any time, while the Purchase Option
          Agreement is in full force and effect, exercise the Purchase Option by
          delivering Sheehan a notice accordingly together with payment of an
          amount equal to the difference between One Hundred and Fifty Thousand
          dollars ($150,000.00) and the aggregate of all monies paid hereunder,
          including without limitation, the Fifteen Thousand dollars
          ($15,000.00) paid to Sheehan upon the execution hereof. Upon delivery
          and payment aforesaid, the Purchase Option shall be deemed to be full
          exercised at the date of giving the said notice and Graphite
          Technology shall thereafter hold One Hundred percent (100%) legal and
          beneficial interest in the Mining Properties free of any lien or
          encumbrance of Sheehan or anyone claiming through Sheehan, save and
          except for the Royalties hereinafter set out and the Cal Graphite
          Option Agreement. Upon the payment in full and the exercise of the
          Option Agreement, Sheehan agrees to discharge the outstanding arrears
          of Royalty payments in the amount of One Hundred and Forty-Six
          Thousand, Two Hundred and Fifty-six dollars and Fifty cent
          ($146,256.50) owing pursuant to the Cal Graphite Option Agreement
          provided that all Royalty and Minimum Royalty payments as hereinafter
          set in this Option Agreement have been paid to date and the Mining
          Properties have been transferred in accordance with Article 11 hereof
          then subject to these conditions, and any right of Sheehan to the
          arrears of Royalty payments or as against the claims pursuant to the
          Cal Graphite Option Agreement in respect thereto shall be forever
          extinguished.

<PAGE>
                                       5

ARTICLE 4 - ROYALTY

4.01     Whether or not Graphite Technology exercises the Purchase Option, it
         shall be obligated to pay Sheehan a Royalty or Minimum Royalty ("the
         Royalty") as follows:

(a)      Commencing on the 1st day of October 2006, and each full year hereafter
         that the Mining Properties are subject to the terms and conditions of
         this Agreement a Royalty, or a minimum annual fixed Royalty in the
         amount of Twenty-two Thousand dollars ($22,000.00) is payable
         hereunder, (subject to the Cost of Living Adjustment clause specified
         below) and shall be paid by Graphite Technology to Sheehan. The first
         Twenty-two Thousand dollar ($22,000.00) Minimum Royalty payment shall
         be due and be paid in one installment on or before the 1st day of
         October 2006, not withstanding that a full year has not expired since
         the execution of this Agreement and thereafter payment shall be made in
         two equal annual installments on or before the 1st day of April and
         October of each and every year;

(b)      The aforesaid minimum annual fixed Royalty payment shall be adjusted
         annually in accordance with any rise or fall in the consumer price
         index ratio for all products for the City of Toronto published or
         announced by Information Canada or any successor federal government
         agency. The first adjustment shall be made on the 1st day of October
         2007 and a subsequent adjustment shall be made on the 1st day of
         October each subsequent year thereafter. The annual fixed Minimum
         Royalty payment for the year commencing on October 1, 2007 and for each
         subsequent year thereafter, shall be paid in and for the previous year
         plus or minus the percentage thereof which is equal to the percentage
         rise or fall of the Consumer Price Index Ratio from the 1st day of
         October 2006 to the 1st day of October of the particular year for which
         the fixed Minimum Royalty payment is due. All such calculations or
         adjustments to the Minimum Royalty shall be based on the Consumer Price
         Index as of the 1st day of October 2006.

(c)      In the year in which commercial mining production and products sales
         begin, and each subsequent year thereafter, the Royalty owing for each
         such year shall be an amount equal to Two and a half (2.5%) percent of
         the gross value of Graphite Technology sales of products derived from
         ore mined on the Mining Properties during in the particular year in
         question, but always subject to the minimum Royalty adjusted as set out
         above. In calculating the gross value of Graphite Technology sales of
         products in any particular year, there shall be no deductions by
         Graphite Technology for any monies expended in respect to its project
         on Mining Properties (including capital costs). More particularly, but
         not so as to limit the generality of the foregoing, there shall be no
         deduction for Graphite Technology's costs of money, operating costs,
         taxes payable, mining, processing, upgrading and any other costs
         relating to its project on the Mining Properties as a whole whether or
         not such activities are actually carried on or done on the Mining
         Properties or elsewhere provided that they apply to the ore or
         materials mined or derived from the Mining Properties.

<PAGE>
                                       6

(d)      After the initial Minimum Royalty payment of Twenty-two Thousand
         dollars ($22,000.00) on the 1st day of October 2006, the Royalty or
         Minimum Royalty shall be paid in semi-annual installments, the first
         Royalty payment to be made on the 1st day of April and the 1st day of
         October in each year commencing on April 1, 2007. In calculating any
         Royalty payment due hereunder, there shall be no deduction from the
         Royalty otherwise payable for any Minimum Royalty payments previously
         paid or made by Graphite Technology to Sheehan in any previous year or
         period, and for greater clarity, the Royalty, or the minimum Royalty,
         as the case may be, shall be payable in addition to the monies set out
         above in respect to Graphite Technology's option of the Mining
         Properties.

ARTICLE 5 - ASSIGNMENTS

5.01     Graphite Technology shall be at liberty to assign and transfer all its
         rights, title and interest in this Option Agreement provided:

(a)      Sheehan is informed and gives its consent thereto, which consent shall
         not be unreasonably withheld;

(b)      Graphite Technology provides written confirmation by the Assignee of
         Graphite Technology that the Assignee shall be bound by this Agreement
         and that the rights and privileges of Sheehan hereunder will be
         followed and respected. Graphite Technology shall remain liable for all
         its obligations and payments due hereunder to Sheehan and in the event
         of default, hereunder Sheehan may enforce any rights or remedies it may
         have jointly or severely, as it shall see fit as against both Graphite
         Technology and the Assignee.

5.02     If Sheehan formulates the intention to assign the right to receive the
         Royalty, in whole or in part, Sheehan shall not complete any such
         assignment and no purported assignment shall be valid unless and until
         the Assignee agrees with Graphite Technology and Sheehan to be bound by
         the provisions hereof as fully as if such Assignee was a signatory
         hereto. The form of such subsistence of such agreement shall be as
         Sheehan and Graphite Technology may reasonably require.

5.03     Sheehan shall be at liberty to assign and transfer its right, title and
         interest in this Option Agreement provided;

<PAGE>
                                       7

(a)      Graphite Technology is first informed and gives it consent thereto,
         which consent shall not be unreasonably withheld; and

(b)      Sheehan shall provide written confirmation by the Assignee of Sheehan
         that the rights and privileges of Graphite Technology hereunder will be
         followed and respected.

ARTICLE 6 - THE RIGHT TO ENTER AND DO WORK

6.01     Sheehan hereby gives and grants to Graphite Technology, its servants
         and agents during the currency of the Purchase Option and the sole and
         exclusive right:

(a)      To enter in, under or upon the Mining Properties;

(b)      To have exclusive and quiet possession of the Mining Properties;

(c)      To do such prospecting, exploration, development and/or other mining
         work thereon and thereunder as Graphite Technology in its sole
         discretion may consider advisable;

(d)      To enter upon and erect upon the Mining Properties such mining plant,
         buildings, machinery, tools, appliances, and/or equipment as Graphite
         Technology in its sole discretion may consider advisable; and

(e)      To remove from the Mining Properties and dispose or ores, minerals and
         metals, but only for the purpose of making assay and tests, unless the
         Option Price and Royalty payments have been paid in full and the Mining
         Properties have been brought to Lease.

ARTICLE 7 - REPRESENTATIONS, WARRANTIES AND COVENANTS

7.01     Sheehan hereby represents and warrants to Graphite Technology that:

(a)      The laws of the Province of Ontario or any other applicable laws with
         respect to the Mining Properties have been complied with and, without
         limiting the generality of the foregoing, the Mining Properties have
         each been properly and duly staked and recorded in accordance with the
         laws of the said Province;

(b)      The Mining Properties are in good standing;

<PAGE>
                                       8

(c)      Graphite Technology may enter in, under or upon the Mining Properties
         for the purposes of the Agreement and subject to the Mining Act of
         Ontario and any environmental laws or regulations applicable thereto,
         extract and dispose of ore, as provided in paragraph 6.01 hereof,
         without making any payment to, and without accounting to or obtaining
         the permission of, any person, firm or corporation.

7.02     Sheehan hereby covenants that:

(a)      It will not use the name of Graphite Technology or any company
         associated with Graphite Technology in any document or release made to
         or available to the public without prior written approval of Graphite
         Technology;

(b)      Any information acquired by it hereunder relating to the Mining
         Properties shall be confidential and shall not be released or
         communicated to any person firm or corporation while this Agreement is
         in full force and effect without the prior written approval of Graphite
         Technology; and

(c)      For so long as the purchase option is in full force and effect, it will
         not deal, or attempt to deal with its right, title and interest in and
         to the Mining Properties in any way that would or might affect the
         right of Graphite Technology hereunder to purchase a One Hundred
         percent (100%) interest in the Mining Properties, free and clear of any
         encumbrance.

7.03     Graphite Technology hereby covenants and agrees for so long as the
         Purchase Option continues in full force and effect:

(a)      To permit Sheehan or its duly authorized agents upon reasonable prior
         notice to Graphite Technology, to have access to the Mining Properties
         in order to examine any work carried out by or on behalf of Graphite
         Technology provided, however, that neither Sheehan nor its agents shall
         interfere with or obstruct the operation of Graphite Technology, its
         servants and agents on the Mining Properties, and further provided that
         Sheehan agrees to indemnify and save Graphite Technology harmless from
         all loss or damage of any nature or kind whatsoever in any way
         referable to the entry of, presence on, or activities of either of
         Sheehan or its agents while on the Mining Properties and including,
         without limiting the generality of the foregoing, bodily injuries or
         death at any time resulting therefrom and damage to property sustained
         by any person or persons;

(b)      To maintain the Mining Properties in good standing while this Agreement
         is in full force and effect and for a further Twelve (12) months after
         the termination thereof;

<PAGE>
                                       9

(c)      To forward Sheehan one copy of all engineering reports, drawings,
         surveys, logs and all other data, or working papers relating to the
         work done on the Mining Properties or on adjoining properties insofar
         as they relate to the Mining Properties;

(d)      To permit Sheehan, its servants or agents access to the books and
         records of Graphite Technology pertaining to the operation or work on
         the Mining Properties for the purposes of calculating or verifying the
         Royalties payable hereunder and compliance with this Agreement, may
         have such books and records audited by an independent firm or chartered
         accountants at Sheehan's costs; and

(e)      To obtain a Lease of the Mining Properties pursuant to the Mining Act
         of Ontario within one year of the signing of this Agreement.

ARTICLE 8 - PROTECTION OF GRAPHITE TECHNOLOGY

8.01     Sheehan will, from time to time, as and when requested by Graphite
         Technology, execute or cause to be executed all further documents and
         instruments which are in the opinion of Graphite Technology reasonably
         necessary to enable Graphite Technology to take advantage of the rights
         given to it in this Agreement.

8.02     Subject to Article 11 of this Option Agreement Sheehan agrees that
         Graphite Technology may protect its interest in the Mining Properties,
         as the same may be from time to time constituted, by doing either or
         both of the following:

         (a)      It may register this Agreement or a memorandum of this
                  Agreement or any other document or documents which Graphite
                  Technology may consider advisable in order to protect is
                  rights and interest hereunder against the title of the Mining
                  Properties; or

         (b)      It may transfer the Mining Properties into its name or into
                  the name of its nominee or nominees, to be held in trust and
                  to be dealt with only in accordance with the provisions of
                  this agreement.

ARTICLE 9 - RIGHT TO REMOVE ASSETS

9.01     At any time and from time to time during the currency of the Purchase
         Option and for a period of One Hundred and Eighty (180) days after the
         termination of this Agreement and subject to compliance thereto,
         Graphite Technology may enter upon and remove from the Mining
         Properties any and all building, plant, machinery, tools, appliances
         and/or equipment brought or erected upon the Mining Properties by
         Graphite Technology. Any such buildings, plant, machinery, tools,
         appliances and/or equipment not so removed within the said period of
         One Hundred and Eighty (180) days shall become the property of Sheehan.

<PAGE>
                                       10

ARTICLE 10 - TERMINATION

10.01    Subject to the provisions of paragraph 7.03(b), 9.01 and 10.03 hereof,
         this Agreement shall terminate and be at an end:

         (a)      If Graphite Technology fails to pay any Option Purchase
                  Installment as set forth in paragraph 2.02 hereof or any
                  Royalty or Minimum Royalty payment as set out in paragraph 4
                  hereof on or before the relevant date therein set forth, then
                  upon the day following such relevant date; or

         (b)      If Graphite Technology fails within Ninety (90) days of this
                  Agreement to transfer the Leased Mining Claims as set out in
                  Schedule "A" annexed hereto free and clear of all encumbrances
                  of any nature and kind whatsoever including the Tormont
                  Construction Lien and Certificate of Action to Robert J.
                  Bassermann who shall hold the same in trust for the parties
                  hereto as there interest may appear together with the
                  un-patented Mining Claims as set in Schedule "B" annexed
                  hereto, which are already held in trust pursuant to the
                  above-mentioned Option Agreement between Sheehan and Cal
                  Graphite and obtains an acknowledgement from International
                  Graphite or other necessary parties releasing him from any
                  obligations to it pursuant to the Trust Agreement; or

         (c)      If Graphite Technology does not exercise the Purchase Option
                  during the currency thereof, then at the expiry of the
                  purchase option; or

         (d)      If Graphite Technology otherwise fails to comply with this
                  Option Agreement.

10.02    In the event that Graphite Technology fails to complete any obligation
         under this Agreement on or before the dates specified herein, (other
         than the payment of money for which no notice is required) Sheehan
         shall give Graphite Technology written notice of the same specifying
         the breach and requiring Graphite Technology to remedy the same. In the
         event that Graphite Technology fails to remedy the breach within Sixty
         (60) days of the receipt of the notice relating thereto, then Sheehan,
         at its option, may declare the Agreement terminated and the Agreement
         thereafter shall be treated as at an end. Notwithstanding that the
         Agreement has been terminated Sheehan, shall be entitled to any
         Purchase Price installments or Royalty payments due or accruing prior
         to such termination, or the cost of fulfilling any other obligation of
         Graphite Technology set out herein, or any damages or other losses
         resulting from such default and may enforce payment or compliance of
         the same in any way it shall in its sole and absolute discretion it
         considers desirable.

<PAGE>
                                       11

10.03    In the event of any dispute between the parties arising wherein Sheehan
         asserts that this Agreement is terminated and Graphite Technology
         denies the validity of the alleged termination, Graphite Technology's
         position and all of Graphite Technology's rights given to it by this
         Agreement shall remain preserved and undisturbed until the matter is
         resolved in Court or otherwise, but Graphite Technology will forthwith
         commence an Action in Ontario claiming a declaration or other
         appropriate relief and to pay the disputed amount into Court to the
         credit of such action, otherwise this Agreement shall be terminated and
         at an end.

10.04    Notwithstanding anything to the contrary contained in this Agreement,
         Graphite Technology may at any time or from time to time, either before
         or after exercise of the Purchase Option, terminate this Agreement with
         respect to any or all Mining Claims comprising part of the Mining
         Properties, subject to paragraph 7.03, 9.01 and this Article hereof,
         upon giving notice accordingly to Sheehan. Forthwith after any such
         termination, such part of the Mining Properties with respect to which
         this Agreement has been terminated shall cease to be part of the Mining
         Properties for the purpose of this Agreement, all obligations of
         Graphite Technology hereunder, including the obligation to pay the
         minimum fixed annual Royalty payment (where the notice has been given
         with respect to all the Mining Claims) shall, subject to this Article
         hereof, thereupon be at an end. The term "Mining Properties" shall mean
         only those parts thereof which are still subject to the provisions of
         this Agreement. Notwithstanding the release of part of the Mining
         Properties only, the Purchase Option Price and the Royalty or Minimum
         Royalty payments hereunder shall not be reduced.

10.05    Upon termination hereof, pursuant to this paragraph 10 or otherwise:

         (a)      If Graphite Technology has registered any agreement,
                  memorandum, document or documents against the title of the
                  Mining Properties, then Graphite Technology shall forthwith
                  for an aggregate consideration of $1.00 discharge or release
                  such agreement, memorandum, document or documents with respect
                  to the Mining Properties or such of them that are no longer
                  subject to the provisions of this Agreement, as the case may
                  be; or

         (b)      If Graphite Technology has transferred the Mining Properties
                  into its name or into the name of its nominee or nominees,
                  then Graphite Technology shall forthwith deliver to Sheehan a
                  duly executed transfer of the Mining Properties or such of
                  them as are no longer subject to the provisions of this
                  Agreement, as the case may be, transferring for an aggregate
                  consideration of $1.00 title thereto to Sheehan or as Sheehan
                  may otherwise in writing instruct;

<PAGE>
                                       12

         (c)      Graphite Technology shall do all things and execute all
                  documents so as to maintain the Mining Properties in good
                  standing and to bring the same to Lease pursuant to the Mining
                  Act of Ontario within One (1) year of the signing of this
                  Agreement;

         (d)      Graphite Technology shall no longer have any claim or interest
                  in or as against the Mining Properties of any nature or kind
                  whatsoever and any monies thereto before paid shall remain the
                  sole property of Sheehan;

         (e)      Graphite Technology shall release all its rights, title or
                  interest in the Mining Properties forthwith.

ARTICLE 11 - TITLE

11.01    Title to the Mining Properties shall be transferred to Robert J.
         Bassermann, the solicitor for Sheehan, who shall hold the same in trust
         for the parties hereto as their interest may appear until the following
         have been completed:

         (a)      That the Option price of One Hundred and Fifty Thousand
                  dollars ($150,000.00) has been paid in full as aforesaid;

         (b)      The claims have been brought to Lease in accordance with the
                  Mining Act of Ontario;

         (c)      All Royalty or Minimum Royalty payments have been paid to
                  date; and

         (d)      The properties presently registered in the name of
                  International Graphite have been transferred to Robert J.
                  Bassermann in accordance with this Agreement and the Tormont
                  Construction Lien and the Certificate of Action in respect
                  thereto have been deleted from the title to the said claims;
                  and

         (e)      Graphite Technology has otherwise complied with this
                  Agreement.

         Upon completion of the above conditions, the Mining Properties shall be
         registered jointly in the name of Sheehan and Graphite Technology or
         their executives, administrators, successors or assigns, as the case
         may be, together with a copy of this Agreement. Thereafter, any Royalty
         payments due shall be a first charge or encumbrance against the Mining
         Properties and payment thereof may be enforced as such in addition to
         any other remedy, which Sheehan may have.

<PAGE>
                                       13

ARTICLE 12 - LEGAL AND ACCOUNTING FEES

12.01    Graphite Technology agrees to pay all of Sheehan's reasonable legal and
         accounting fees payable in connection with the negotiation, drafting,
         registration and servicing of this Agreement and all other matters
         relating thereto as well as a liability for outstanding fees that
         Sheehan has accrued in relation with his dealings with Cal Graphite and
         International Graphite, which Graphite Technology acknowledges are in
         excess of Ten Thousand dollars ($10,000.00) plus G.S.T.

ARTICLE 13 - NOTICE

13.01    Any notice, document or other communication required or permitted by
         this Agreement to be given by a party hereto shall be in writing and is
         sufficiently given if delivered personally, or if sent by prepaid
         ordinary mail, or if transmitting by any form of telecommunication to
         either party to this Agreement as listed below:

                  Graphite Technology Group Inc.
                  106 Lakeside Avenue, P.O. Box 210
                  Delano, PA  18220

                  Vincent Sheehan
                  c/o Robert J. Bassermann
                  214 - 120 Carlton Street
                  Toronto, Ontario
                  M5A 4K2

13.02    Either party may from time to time by notice in writing change its
         address for the purposes of this Article 13.

13.03    Any payment that Graphite Technology may decide to make or cause to be
         made to Sheehan hereunder shall be deemed to have been well and truly
         made if a cheque payable to Sheehan in accordance with the provisions
         of paragraph 13.01 hereof, the provisions of which shall apply, Mutatis
         Mutandus, as if such cheque was a notice given hereunder.

<PAGE>
                                       14

ARTICLE 14 - INDEMNIFICATION AND UNDERTAKING

14.01    Graphite Technology agrees to indemnify and save Sheehan harmless from
         all claims, actions, causes of action, expenses, losses and damages
         brought against or suffered by Sheehan as a result of any act or
         omission of Graphite Technology arising out of Graphite Technology's
         occupation, use and control of the Mining Properties.

14.02    Graphite Technology further undertakes not to do anything which might
         encumber the Mining Properties to the detriment or prejudice of Sheehan
         and undertakes to do all work on the Mining Properties in good workman
         like manner and to comply with all municipal, provincial and federal
         laws and by-laws and regulations covering its conduct and with regard
         to the Mining Properties.

ARTICLE 15 - OPTION

15.01     Subject to the provisions hereof specifically to the contrary, this is
         an Option Agreement only and nothing herein contained and no act done
         nor payment made hereunder shall obligate Graphite Technology to do any
         further or other act or acts or to make further payment or payments,
         and in no event shall this Agreement or any act done or any payment
         made be construed as an obligation of Graphite Technology to do or
         perform any work or make any payments or further payments on or with
         respect to the Mining Properties. PROVIDED HOWEVER, notwithstanding
         that the foregoing Graphite Technology undertakes to bring the claims
         to Lease pursuant to the Mining Act of Ontario on or before the 28th
         day of February 2007, in addition, Graphite Technology shall record all
         work done against the said claims and insure that the taxes are paid
         and there is sufficient work done on the claims for Twelve (12) months
         after the termination in order to maintain the same in good standing
         and arrange the transfer of the Lease Claims to Robert J. Bassermann or
         Sheehan free and clear of all encumbrances.

ARTICLE 16 - MINING AND EXPLORATION

16.01    Graphite Technology shall conduct its exploration, mining and other
         activities on the Mining Properties in accordance with good mining and
         exploration practice and to comply with all mining, environmental laws,
         by-laws or regulations of any governmental body having jurisdiction,
         including the closing of any workings and the reclamation of any lands
         where buildings or other mining debris has been dumped or placed
         according to law.

<PAGE>
                                       15

ARTICLE 17 - TRAPPERS CABIN

17.01 Graphite Technology agrees to permit Sheehan to maintain his trappers
cabin in the vicinity of Graphite Lake located on the Mining Properties optioned
hereunder until such time as he is required or is requested to remove the same
by Graphite Technology or by any law, by-law, or regulation for the Province of
Ontario which requires him to remove the same. In either case, Graphite
Technology agrees to pay Vincent Sheehan reasonable compensation for the costs
of removing, relocating or rebuilding the same in an alternative location and in
the event the parties cannot agree as to the amount and content of reasonable
compensation or costs, Graphite Technology may at its own expense relocate the
cabin to a sight specified by Sheehan which sight shall be no further then Fifty
(50) miles from where it is presently located or in the alternative to pay
compensation for its reconstruction in the amount of to but not exceeding the
present value of the cabin at the time it was relocated or constructed

ARTICLE 18 - GENERAL

18.01    Sheehan and Graphite Technology both agree that either before or after
         termination of this Agreement, they will execute all documents and do
         all acts and things as either of them may reasonably request and as may
         be lawfully within its power to do (other than the payment of money) to
         carry out the provision and/or the intent of this Agreement.

18.02    This Agreement supersedes all prior negotiations and contains the
         entire understanding between the parties hereto and may be modified
         only by instrument in writing signed by the party or parties against
         which the modification is asserted.

18.03    Time shall be of the essence of this Agreement and shall enure to the
         benefit of and be binding upon Sheehan, its successors and assigns and
         Graphite Technology, its successors and assigns.

18.04    The parties hereto shall execute all documents and further assurances
         and do all things that shall be necessary or desirable in order to
         carry out the terms and intent of this Option Agreement.

18.05    Interest shall be payable in any monies outstanding or in default
         pursuant to this Agreement at the rate of Ten (10%) percent per annum.

18.06    This Agreement shall be subject to and he interpreted and administered
         in accordance with the laws of the Province of Ontario and disputes or
         actions commenced in respect thereto shall be in the Province
         aforesaid.

<PAGE>
                                       16

         IN WITNESS WHEREOF the parties hereto have executed this Agreement as
of the date first above written.

                                            )
                                            ) GRAPHITE TECHNOLOGY GROUP INC.
                                            )
                                            )
                                            ) /s/ Harold King
                                            ) ---------------
                                            ) I have authority to bind the
                                            ) Corporation.
                                            )
                                            )
/s/ Linda Nolan                             )        /s/ Vincent Sheehan
-------------------                         )        -------------------
Witness                                     )        Vincent Sheehan
                                            )

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