Document:

Exhibit 10.2

 

EXHIBIT A

 

Form of Letter to be Used to Exercise Nonqualified Stock Option

 

Date

	
            
 
 
 	
             
 
	
            
 
 
 	
             
 
	
            
 
 
 	
             
 

 

Attention:                                               

 

I wish to exercise the stock option granted on                         and evidenced by a Stock Option Agreement dated as of                        , to acquire                         shares of Common Stock of                        , at an option
price of $                per share. In accordance with the provisions of paragraph 1 of the Stock Option Agreement, I wish to make payment of the exercise price (please check all that apply):

	
            :o
 	
            in cash
 
	
            :o
 	
            by delivery of shares of Common Stock held by me
 
	
            :o
 	
            by simultaneous sale through a broker of Option Shares
 
	
            :o
 	
            by authorizing the Company to withhold Option Shares
 

 

Please issue a certificate for these shares in the following name:

	
            
 
 
 	
             
 
	
            Name
 	
             
 
	
            
 
 
 	
             
 
	
            Address
 	
             
 
	
            
 
 
 	
             
 

 

	
             
 	
            Very truly yours,
 
	
             
 	
             
 
	
             
 	
            Signature
 
	
             
 	
             
 
	
             
 	
            Typed or Printed Name
 
	
             
 	
             
 
	
             
 	
            Social Security Number================================================================================

                     SETTLEMENT AGREEMENT AND MUTUAL RELEASE

1.       Parties.     THIS AGREEMENT and MUTUAL RELEASE ("Release") is dated and
entered into as of this 31st day of January, 2007, by and between JMT Resources,
Ltd., ("JMT") a Texas corporation located at 5416 Birchman Avenue, Fort Worth,
TX 76107, and Quantum Energy, Inc., Nitro Petroleum Inc., 658111 B.C. Ltd,
and RPMJ Corporate Communications Ltd (hereinafter "Quantum")

2.       Recitals.  The alleged facts and circumstances giving  rise to this
         Release  are as set forth herein below.

2.1      JMT owns  approximately  4,010 gross  acres in mineral  interest
         leaseholds  located in Navarro  County,  Texas (the "Prospect  Leases")
         which are part of the geologic  trend  identified  as the Mildred pool;
         and

2.2      JMT has offered  QUANTUM the right to participate in the cost of
         developing the Prospect  Leases to be funded by QUANTUM, subject to the
         terms of this Agreement; and

2.3      QUANTUM  agrees to finance JMT's  development  and  operation of the
         Prospect  Leases in accordance with the funding requirements described
         in the JV Agreement; and

3.       Consideration.    Consideration for this  Release is the mutual promise
         --------------
herein and each act done by the parties hereto pursuant  hereto, the receipt and
sufficiency of which is acknowledged by the parties hereto, and the following:

1.            QUANTUM shall cease and desist in using,  displaying,  or
              having  any  interest  in  the  Corsicana  Project  under  the  JV
              Agreement, Letter of Intent and any other agreement that may exist
              between the parties and their  agents or assignees  pertaining  to
              Corsicana, including but limited to, the 3 well bores, McKinney #1
              and McKinney #2 and Blackburn #1 from the Pecan Gap; and

2.       JMT Resources Ltd. will pay the following:
                1.       Quantum $308,200.00 USD;
                2.       Nitro Petroleum, Inc. $145,502.00 USD;
                3.       658111 B.C. Ltd. $23,149.00 USD; and
                4.       RPMJ Corporate Communications Ltd. $23,149.00 USD.

3.            QUANTUM hereto  acknowledges  that it will not be entitled
              to any additional  consideration for the execution of this Release
              other than as expressly set forth and provided for herein.  By its
              signature  below,  QUANTUM  hereto  acknowledges  the  receipt and
              sufficiency of the consideration evidenced by this Release.

4.       JMT will pay the above fees on or before March 1, 2007.

5.       Quantum  will execute any and all  assignments  necessary  to complete
         transfer of the  leaseholds back to JMT immediately upon the execution
         of this Agreement.

4.       No Pending Claims.    QUANTUM  warrants and  represents  that there are
         ------------------
not claims against any party hereto or any party in any way related hereto,
which is either pending, or otherwise aware.  QUANTUM acknowledges that JMT is
relying upon this  representation and this  representation is a material
inducement to the execution of this Release by JMT.

Neither  JMT nor  QUANTUM et al shall  commence  or  continue,  nor does JMT nor
QUANTUM et al know of, any claims or  proceedings  against  anyone in respect of
anything hereby  released which may result in a claim or proceeding  against JMT
or  QUANTUM  et al.  IF ANY SUCH  CLAIM or  proceeding  results  in any claim or
proceeding  against  JMT or QUANTUM  et al,  then JMT shall  indemnify  and save
QUANTUM et al harmless from all resulting  liabilities,  obligations  and costs.
Without limiting the generality of the foregoing, JMT shall indemnify QUANTUM et
al from any and all  environmental  liability,  which now or hereafter  exist by
reason of any cause, events or omissions existing prior to the execution of this
Mutual Release.

<page>

5.      Settlement of agreement. The agreements being made herein are merely
        -----------------------
to  settle a offer to  purchase  and a offer to sell  the  entire  interests  in
properties  defined as Corsicana  and are not to be construed as an admission of
any fault or liability of any party hereto,  such being hereby  specifically and
expressly denied by each party hereto.

6.      Authorization.  The making and  performance of this Release has been
        --------------
duly authorized and is approved by each party hereto.  This Release  constitutes
the legal,  valid and binding obligation of each party hereto and is enforceable
in accordance with its terms.  In addition,  the undersigned are duly authorized
by the  respective  parties to  execute  this  Release  in their  representative
capacities by all necessary proceeding.

7.       Representation and Ownership and Indemnification.    Each party hereto
         -------------------------------------------------
and/or their subsidiaries represent and convent that they are the  owners of any
and all  claims  at issue  herein  or in any way relating to or involving the
subject matter set forth herein.

8.       Review and Understanding.  Each party  hereto has reviewed  the Release
         -------------------------
and they  understand  fully the terms of this  Release  and its consequences and
have had this  Release  reviewed by  competent legal counsel of their choice.

9.       Binding  Effect.  This Release shall be binding upon and inure to the
         ---------------
benefit to the parties hereto and their respective successors,  assigns,  heirs,
and legal representatives, but shall not be binding on any party until signed by
all  parties.  It is expressly  understood  and agreed that the terms hereof are
contractual in nature,  including  those set forth in the provisions  designated
"Recitals," and are not mere recitals,  the agreements  herein contained and the
consideration  transferred  hereby  are  to  by  peace,  and  the  consideration
transferred  and  conveyed  hereby  shall not be  construed  as an  admission of
liability by any of the parties to this Release.

10.      Modification.     No  modification  or  amendment of this Release shall
         -------------
be effective  unless such modification or amendment is in writing and signed by
all parties hereto.

11.     Governing Law. The interpretation,  construction,  and performance of
        --------------
this Release shall by governed by the laws of the State of Texas and California,
without  giving  effect to  conflict  of laws  principles,  and this  Release is
performable in Tarrant County, Texas and San Diego County, California.

12.      Severability.    If any  portion  of this  Release  shall be held to be
         -------------
invalid or inoperative, then, so far as is reasonable and possible, the
remainder of this Release shall be considered valid and operative, and not
effect shall be given to the intent manifested by the portion held invalid or
inoperative.

13.      Execution of Necessary Documents.  Each party  hereto  further convents
         ---------------------------------
and  agrees to execute any and all documents necessary to effectuate the
provisions of this Release and to cooperate fully with each other in carry out
the provisions of this Release.

14.      Survival.        Each and every provision of this Release shall survive
         ---------
the execution hereof.

15.      Entire Agreement. This Agreement for all purposes constitutes the
         -----------------
entire agreement between the parties hereto and supersedes all prior and
contemporaneous agreements, understandings, negotiations and discussions,
whether oral or written.

<page>

16.     Attorneys'  Fees.  In the event of any  litigation  concerning  any
        -----------------
controversy,  claim or dispute  between  each  party  hereto  arising  out of or
relating to this Release or the breach hereof, or the interpretation hereof, the
prevailing  party shall be entitled to recover form the losing party  reasonable
expenses,  attorneys'  fees, and cost incurred  therein or in the enforcement or
collection of any judgment or award rendered herein.

IN WITNESS WHEREOF,  the parties have duly executed this Agreement as of the day
and year first above written.

JMT RESOURCES, LTD.                           RPMJ Corporate Communications Ltd.

By: /s/ Luke Zouvas                           By: /s/ Patricia Shull
   -----------------------------------        ------------------------------

Title: Attorney for JMT Resources LTD.        Title: President and Secretary
       ------------------------------         ------------------------------

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

QUANTUM ENERGY, INC.

By: /s/ Ted Kozub
-----------------
Title: President

Date:

NITRO PETROLEUM, INC.

By: /s/ Ted Kozub
-----------------
Title: President

Date:

658111 B.C. Ltd

By:/s/ Jason Shull
-------------------------------
Title: President  and Secretary

Date:

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