Document:

Exhibit 10.3

April 7, 2002

Mr. Thomas Y. Gorman Jr.
702 Clarendon
Longmont, Colorado 80501

Re: Settlement of Wages, Bonus and Expenses

Dear Tom:

Pursuant  to  ongoing  conversations,  when  signed  by you,  this  letter  will
constitute a final  settlement as to  outstanding  wages and bonuses owed you by
Arete Industries, Inc. (Arete) and any of its subsidiaries, including Aggression
Sports,  Inc.  (Arete  Outdoors)  and  will  resolve  any  claims  you may  have
whatsoever against either entity or any of its officers,  directors or employees
concerning  the  business  of either  Company  arising  during  the term of your
employment there through the date of this agreement.

According to the records of the Company,  you have outstanding $150,000 in gross
wages and  $119,000 in gross bonus owing from the Company  through  December 31,
2001.  The Company  does not have now, nor does it  anticipate  that in the near
future,  will have any  funds to pay these  amounts,  but does  anticipate  that
within the next 6 months,  it will own common stock interests in companies which
will be acquired in part by the  Company and which the Company  will  distribute
all or a portion of its  holdings in such  companies  to its  shareholders  in a
registered dividend of freely trading shares in such entities.

Therefore,  as an inducement to you to forgive the Company of its obligations to
you as described  above,  offers in exchange for such  forgiveness  the right to
receive  9% of the  total  stock  dividend  distributed  by the  Company  to its
shareholders  from  the  first  four  (4)  companies  that it  spins  off to its
shareholders in a registered stock dividend and/or a registered rights offering.
On or before June 30, 2002,  the Company will identify the entities to which the
above dividend will apply.

By your signature  below  indicating your acceptance of this offer of settlement
as a binding legal agreement upon you and the Company,  its officers,  directors
and  subsidiaries,  you  confirm  that you waive the right to sue to collect the
amounts  due you as stated  above,  and  waive  and  release  the  Company,  its
subsidiaries,  current and former officers,  directors and shareholders from any
claims,  rights or causes of action  which you may have  against  them or any of
them arising from your employment or otherwise during the term thereof,  arising
as a  shareholder  or employee of the Company and its  subsidiaries  through the
date hereof.  You further confirm and acknowledge:  (i) that there are potential
unanticipated  problems  which may arise  relating to the  Company's  ability to
issue the referenced  dividends,  including without  limitation the inability of
either or all the  prospective  subsidiaries  to gain approval of the Securities
and Exchange Commission of a registration  statement covering the shares of such
subsidiaries  subject  to the  dividend;  (ii)  that  two of the  four  proposed

<PAGE>

Mr. Thomas Y. Gorman, Jr.
April 7, 2002
Page 2 of 2

dividends are contingent upon the Company entering into  acquisition  agreements
with companies yet to be identified and that acquisition  agreements  concerning
them are not assured and that the  forgiveness,  waivers and releases being made
by you are not contingent upon the occurrence of any such event;  and (iii) that
there may be adverse tax  consequences to the above settlement by the Company or
other adverse consequences  arising from the unconditional  waivers and releases
provided in this agreement and  none-the-less  enter into this agreement without
reservation or qualification.

This offer is valid and binding on the Company only upon your signature below on
or before 12:00 midnight, Monday, April 8, 2002.

By the Company and on behalf of its subsidiary, Aggression Sports, Inc.:

By: /s/ Thomas P. Raabe                              Date:  April 7, 2002
    --------------------------------                        --------------------
    Thomas P. Raabe, CEO

WITNESS:

BY: /s/  Thomas Y. Gorman                            Date:  April 7, 2002
    --------------------------------                        --------------------
    Thomas Y. Gorman, Individually

WITNESS:

    --------------------------------                 Date:
                                                            --------------------

             2955 Valmont Road, Suite 300 o Boulder, Colorado 80301
                   o Phone: 303.247.1313 o Fax: 303.247.1315E-REX, INC.
                               2002 NON-QUALIFIED
                           STOCK GRANT AND OPTION PLAN

     1.     PURPOSE:  This  Non-Qualified  Stock  Grant  and  Option  Plan  (the
            -------
"Plan") is intended to serve as an inventive to and to encourage stock ownership
by  certain  directors,  officers,  employees  of  and certain persons rendering
service  to  E-Rex,  Inc., a Nevada corporation (the Corporation"), so that they
may  acquire  or  increase  their  proprietary  interest  in  the success of the
Corporation,  and  to  encourage  them  to  remain in the Corporation's service.

     2.     ADMINISTRATION:  The  Plan shall  be  administered  by  a  committee
            --------------
appointed  by  the  Corporation's  Board  of  Directors  (the  "Committee"). The
Committee  shall  consist  of  not  less  than  three  (3)  members who shall be
appointed  by,  and  serve  at  the  pleasure  of,  the  Corporation's  Board of
Directors.  The Board of Directors may from time to time remove members from, or
add members to, the Committee. Vacancies on the Committee, however caused, shall
be  filled only by the Board of Directors. The Committee shall select one of its
members  as Chairman, and shall hold meetings at such times and places as it may
determine. Acts by a majority of the Committee in a meeting at which a quorum is
present  and  acts  approved  in  writing  by  a  majority of the members of the
Committee  shall  be the valid acts of the Committee. No member of the Committee
shall  vote  on  any matter concerning his or her own participation in the Plan,
except  that  the  Board  of  Directors as a whole may act on options granted to
directors. If no Committee has been appointed, the entire Board shall constitute
the  Committee.

            The  Committee  shall be authorized to grant  stock  and/or  options
under  the  Plan  to  such  directors,  officers, employees of and other persons
rendering  service to the Corporation or any parent or subsidiary corporation of
the  Corporation,  as defined for purposes of Internal Revenue Code Section 422A
("Parent  or  Subsidiary"),  at such times and in such amounts as it may decide.

            The interpretation and construction by the  Committee  of any provi-
sions  of  the  Plan  or  of  any  option granted under it shall be final unless
otherwise  determined  by  the Board of Directors. No member of the Committee or
Board  of Directors shall be liable for any action or determination made in good
faith  with  respect  to  the  Plan  or  any  option  granted  under  it.

     3.     ELIGIBILITY
            -----------

     3.1.     General:  Any  person  who performs services of special importance
              -------
to  the  Corporation,  or  any  Parent  or  Subsidiary  thereof, relating to the
Corporation's  management, operation or development shall be eligible to receive
stock or options under the Plan.  The selection of stock and/or options received
shall  be within the sole and absolute discretion of the Committee, or the Board
of  Directors.

     3.2.     Termination  of Eligibility:  Any  option  granted hereunder shall
              ---------------------------
expire  if,  for any reason other than his or her death, the optionee (i) ceases
to  be employed by the Corporation or a Parent or Subsidiary thereof; (ii) is no
longer  a  member  of  the  Corporation's Board of Directors; or (iii) no longer
performs  services  for  the  Corporation  as  an  independent  contractor.  The
expiration  will  take  effect  at the earliest of the following times: four (4)
months  from  the  date  of  the  occurrence  causing termination of eligibility
(twelve  (12)  months if the optionee's eligibility ceases because of his or her
disability),  or  upon  the  date  the  option expires by its terms. During such
four-month period, the option may be exercised in accordance with its terms, but
only  in  respect  of  the  number of shares for which the right to exercise has
accrued  on  the  date  of termination of employment, or status as a director or
independent  contractor.  The Committee shall decide whether an authorized leave
of  absence  or absence for military or governmental service, or absence for any
other  reason,  shall constitute termination of eligibility for purposes of this
Section.  This  determination  shall  be  subject  to  review  by  the  Board of
Directors.

     3.3.     Death  of  Optionee and Transfer of Option:  If the optionee  dies
              ------------------------------------------
while  eligible  to participate in the Plan, or within four (4) months after the
termination  of  his  or her eligibility, and shall not have fully exercised the
option,  the option may be exercised at any time within twelve (12) months after
the  optionee's  death  by  the optionee's executors or administrators or by any
person  or persons who acquired the option directly from the optionee by bequest
or  inheritance.  However,  no option shall be exercisable after it expires; and
options  may  be  exercised  only  to  the  extent  that the optionee's right to
exercise the option had accrued at the time of his or her death and had not been
previously  exercised.

              No option shall be transferable by the optionee otherwise than  by
will  or  the  laws  of  intestate  succession.

     4.     IDENTIFICATION OF STOCK:  The stock subject to grant and the options
            -----------------------
shall  be  shares  of  the  Corporation's authorized but unissued or acquired or
reacquired  Common  Stock, par value $0.001 (the "Stock").  The aggregate number
of  shares  subject to outstanding options shall not exceed 13,500,000 shares of
Stock (subject to adjustment as provided in Section 5.6).  If any option granted
hereunder shall expire or terminate for any reason without having been exercised
in  full,  the  unpurchased  shares subject thereto shall again be available for
purposes  of  this  Plan.

     5.     TERMS AND CONDITIONS OF OPTIONS:  Any option granted pursuant to the
            -------------------------------
Plan shall be evidenced by an agreement in such form as the Committee shall from
time  to time determine, which agreement shall comply with and be subject to the
following  terms  and  conditions:

     5.1.     Number of Shares:  Each option shall state the number of shares to
              ----------------
which  it  pertains.

     5.2.     Option Exercise Price:  Each  option shall state the option price,
              ---------------------
which shall  be  determined  at  the  Committee's  discretion.

     5.3.     Method of Exercise: An option shall be exercised by written notice
              ------------------
to the Corporation stating the number of shares with respect to which the option
is  being exercised and designating a time for the delivery thereof, which shall
be not more than fifteen (15) days after notice is given unless another date was
mutually agreed upon. At the time specified in the notice, the Corporation shall
deliver  to  the  optionee  at  the  Corporation's  principal  office,  or other
appropriate  place the Committee determines, a certificate(s) for such shares of
previously  authorized  but  unissued shares or acquired or reacquired shares of
Stock  as  the  Corporation  may  elect.   Notwithstanding  the  foregoing,  the
Corporation may postpone delivery of any certificate(s) after notice of exercise
for  any  reasonable  period  required  to  comply  with  any applicable listing
requirements  of  any  national  or  other  securities exchange. In the event an
option  shall be exercisable by any person other than the optionee, the required
notice  under  this  section  shall  be accompanied by appropriate proof of such
person's  right  to  exercise  the  option.

     5.4.     Medium  and  Time  Payment:  The  option price shall be payable in
              --------------------------
full  upon  the exercise of the option by certified or bank cashier's check, the
promissory note of the optionee, or any equivalent form of payment acceptable to
the  Corporation.

     5.5.     Term  of  Option:  The term of  an  option granted hereunder shall
              ----------------
be  determined  by  the Committee at the time of grant, but shall not exceed ten
(10)  years  from  the  day  of  the  grant.  In  no  event  shall any option be
exercisable  after  the  expiration  of  its  term.

     5.6.     Adjustments  Upon  Changes  in  Capitalization:   Subject  to  any
              ----------------------------------------------
required  shareholder  action,  the  number  of  shares of stock covered by each
outstanding  option  and  the  price  per  share  in  each  such option shall be
proportionately  adjusted  for  any increase or decrease in the number of issued
shares  of  Stock  of  the  Corporation  resulting  from:  (i)  a subdivision or
consolidation  of  shares; (ii) the payment of a stock dividend (but only on the
Stock);  (iii)  any  other  increase  or  decrease  in the number of such shares
effected  without  receipt  of  consideration by the Corporation; (iv) or, as to
Stock  issued  other  than  pursuant  to  a  stock option granted to a director,
officer, employee or a person rendering services as an independent contractor to
the  Corporation  or  any  Parent or Subsidiary, any increase or decrease in the
number  of shares made for per share consideration less than the option price of
such  option.  Any  fraction  of  a share subject to option that would otherwise
result  from  an  adjustment  pursuant  to  this  subparagraph  shall be rounded
downward  to  the  next  full  number  of  shares  without other compensation or
consideration  to  the  holder  of  the  option.

              Subject  to  any required shareholder action,  if the  Corporation
shall  be  the  surviving  corporation  in  any  merger  or  consolidation, each
outstanding  option  shall pertain and apply to the securities to which a holder
of the number of shares of Stock subject to the option would have been entitled.
The  Corporation's  Board  of  Directors  may  grant  each optionee the right to
exercise  his  or  her  option  in  whole  or  in  part immediately prior to the
Corporation's  dissolution  or  liquidation, or merger or consolidation in which
the  corporation  is  not  the  surviving  corporation.  If  the  Corporation is
consolidated  with  or  merged into any other corporation, or if the Corporation
sells  or  transfers  all  or  substantially  all of its assets, or if any other
similar  event affecting shares of Stock of the Corporation should occur, and if
the  exercisability  of the options is not accelerated by the Board of Directors
and  the  acquiring  Corporation assumes the Corporation's obligations under the
options granted under this Plan, then each optionee shall be entitled thereafter
to  purchase  shares  of stock and other securities and property in the kind and
amount, and at the price, which the optionee would have been entitled had his or
her option been exercised prior to such event. The Corporation shall make lawful
provision  therefore  as  part  of  any  such  transaction.

              To the  extent  that  the  foregoing  adjustments  relate to stock
or  securities  of  the  Corporation, they shall be made by the Committee, whose
determinations  shall  be  final,  binding  and  conclusive.

              The  grant  of  an option pursuant to the Plan shall not affect in
any way the Corporation's right or power to make adjustments, reclassifications,
reorganizations  or changes of its capital or business structure, or to merge or
to consolidate or to dissolve, liquidate or sell, or transfer all or any part of
its  business  or  assets.

              Whenever the Corporation takes any action resulting in any adjust-
ment  provided  for in this Section 5.6, the Corporation shall forthwith deliver
notice  of  the  action  to  optionee.  The notice shall set forth the number of
shares  subject to this Option and the purchase price thereof resulting from the
adjustment.

     5.7.     Rights as a Shareholder:  An optionee or a transferee of an option
              -----------------------
shall  have no rights as a shareholder with respect to any shares underlying his
or  her  option  until  the  date  the optionee is issued a certificate for such
shares.  No  adjustment  shall be made for dividends (ordinary or extraordinary,
whether  in cash, securities or other property) or distributions or other rights
for which the record date is prior to the date such stock certificate is issued,
except  as  provided  in  Section  5.6  above.

     5.8.     Modification,  Extension  and Renewal of Options:  Subject  to the
              ------------------------------------------------
terms  and  conditions and within the limitations of the Plan, the Committee may
modify,  extend  or  renew outstanding options granted under the Plan, or accept
the  surrender  of outstanding options (to the extent not theretofore exercised)
and  authorize  the  granting  of  new options in substitution therefore (to the
extent  not  theretofore  exercised).

     5.9.     Other Provisions:  The option agreements authorized under the Plan
              ----------------
shall  contain such other provisions, including without limitation, restrictions
upon  the exercise of the option, as the Committee and the Board of Directors of
the  Corporation shall deem advisable.  Thus, for example, the Committee and the
Board  of  Directors  may  require  that all or any portion of an option granted
hereunder not be exercisable until a specified period of time has passed or some
other  event  has  occurred.

     6.     TERM OF PLAN:  Options may be granted pursuant to the Plan from time
            ------------
to  time  within a period of ten (10) years from the date the Plan is adopted by
the  Corporation's  Board  of  Directors  or  is  approved  by the Corporation's
shareholders,  whichever  occurs  earlier.  Termination  of  the  Plan shall not
affect  any  option  previously  granted.

     7.     AMENDMENT OF THE PLAN:  To the extent permitted by law  and  subject
            ---------------------
to  any  required  approval  by  the  Corporation's  shareholders,  the Board of
Directors  may  suspend or discontinue the Plan or revise or amend it in any way
with  respect  to  any  shares  not  subject  to  options  at  that  time.

     8.     APPLICATION OF FUNDS:  The proceeds received by the Corporation from
            --------------------
the  sale  of  Stock  pursuant  to  options  may  be  used for general corporate
purposes.

     9.     NO OBLIGATION TO EXERCISE OPTION:  The granting of an  option  shall
            --------------------------------
impose no  obligation  upon  the  optionee  to  exercise  such  option.

     10.    SECURITIES  LAWS  COMPLIANCE:   Notwithstanding  anything  contained
            ----------------------------
herein,  the  Corporation  shall not be obligated to grant any option under this
Plan,  or  to  sell or issue any share pursuant to any option agreement executed
pursuant  to  the  Plan,  unless  the grant or sale is effectively registered or
exempt  from  registration  under the Securities Act of 1933, as amended, and is
qualified or exempt from qualification under the California Corporate Securities
Law  of  1968,  as  amended.

     As  adopted  by  the  Board  of  Directors  on  August  5,  2002.

                              E-Rex, Inc.,
                              a Nevada corporation

                              /s/ Carl Dilley
                              ----------------------------
                              By:   Carl Dilley
                              Its:  President

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