Signature
Exploration & Production Corp.




5401 S.
Kirkman Road Suite 310


Orlando,
Florida 32819





February
3, 2009




Joel
Silver


Marc
Casteel


P.O. Box
61081


Las
Vegas, Nevada 89160





Re:
Letter of Intent to establish a business relationship with Phoenix
Energy





Gentlemen:




I enjoyed
the opportunity to meet with you and discuss your company’s future plans and the
possibility that a business relationship could be established between Phoenix
Energy and Signature Exploration & Production Corp. You have some very
interesting opportunities that are very attractive.  I believe that we
have a unique opportunity to do something that would generate superior returns.
Signature Exploration & Production would like to take the next step and
commence due diligence to see if we can negotiate a deal mutually acceptable to
both of us that would permit us all to come together.




To that
end, I have prepared this preliminary, letter of intent (this “Letter of Intent”) to
record the mutual understanding and intent of Signature Exploration &
Production Corp.(“SXLP”) and Phoenix
Energy (“PE”),
concerning the proposed business relationship.




1.           Overview of
Relationship.  The parties anticipate that SXLP will invest up
to $30,000 USD. These funds will be first utilized for the 3-D seismic studies
on the property identified as the Nettie Rhodes Lease in the M. Casteel Oil
& Gas Exploration Project 2006-A and any remaining funds are to be used for
expenses related to the Nettie Rhodes Lease in the M. Casteel Oil & Gas
Exploration Project 2006-A. SXLP will receive a 30% ownership interest in the
Nettie Rhodes Lease as consideration for this investment. Mark Casteel and Joel
Silver will maintain a 30% ownership interest in the Nettie Rhodes Lease for the
expenditures and efforts to date. It is expected that an additional investment
of approximately $1.5 million USD will be required to drill and complete the
single well utilizing horizontal drilling technologies on the Nettie Rhodes
Lease. The $1.5 million additional investment will represent the balance of the
ownership in the Nettie Rhodes Lease. An AFE will be produced by Phoenix Energy
for the initial well to be drilled on the Nettie Rhodes Lease. Once accepted,
the drilling operations for the initial well will begin as soon as practical
upon funding for the initial well. If the first well is not completed or deemed
not commercially viable, there will be no commitment to drill additional wells
on the Nettie Rhodes lease. All subsequent drills will be reviewed and
determinations made in concert with management of Phoenix and SXLP on the
subsequent wells to be drilled. The parties recognize that the structure of the
relationship is subject to continuing review and analysis and that it may be
necessary or appropriate to amend the structure of the relationship as a result
of tax, accounting or other considerations, as may be mutually agreed by the
Parties.  The parties also recognize that an alternative transaction
structure may necessitate changes in ownership and other terms of the
relationship.  The term “Agreement” and related defined terms shall be
deemed modified herein as appropriate to reflect such mutually agreed upon
alternative structure.









2.           Additional Leases and
Prospects.  Phoenix Energy will immediately commence activities
to pursue the additional leases identified as the Donnell Lease, The Moreland
Lease and the Rhodes Lease. SXLP will act as co-operators with Phoenix Energy on
all prospects held or acquired by Phoenix Energy as long as SXLP is an investor
in said lease. The business structure between Phoenix Energy and SXLP will be
structured according to the same structure as the Nettie Rhodes Lease on all
additional leases. The basic structure indicating that Phoenix and SXLP will
have identical rights and ownership on a ground floor, non-promoted
basis.




3.           Due
Diligence.  From time to time upon the reasonable request of
either Party, the Party shall, and shall cause each of its officers, employees,
agents, accountants and counsel to (a) afford the officers, employees, agents,
accountants, counsel, other representatives and prospective financing sources of
the other Party full access to the offices, properties, plants, other
facilities, books and records, officers, directors, employees, agents,
accountants and counsel of the Party and (b) furnish to the officers, employees,
agents, accountants, counsel and prospective financing sources of the Parties
such additional financial and operating data and other information regarding the
business, operations, assets, liabilities and financial condition of the
Party.




4.           Exclusivity.  From
the date of this Letter of Intent through the earlier of (i) the execution of
the Agreement and (ii) the termination of this Letter of Intent, Phoenix Energy
nor any of its affiliates nor any of its or their respective officers,
employees, directors, agents or other representatives will (a) solicit,
initiate, encourage or accept any other inquiries, proposals or offers from any
Person (as defined below) (x) relating to any acquisition or purchase of all or
any portion of the Nettie Rhodes Lease, the Donnell Lease, the Moreland Lease,
and the Rhodes Lease (y) to enter into any merger, recapitalization,
reorganization, joint venture or other business combination with
the  or any of its subsidiaries or (z) to enter into any other
extraordinary business transaction involving or otherwise relating to Phoenix
Energy or any of its subsidiaries (any of the transactions described in clauses
(x), (y) and (z) being referred to herein as a “Business
Combination”) or (b) participate in any discussions, conversations,
negotiations or other communications with any other Person regarding, or furnish
to any other Person any information with respect to, or otherwise cooperate in
any way, assist or participate in, facilitate or encourage any effort or attempt
by any other Person to seek to do any of the foregoing.  Phoenix
Energy immediately shall cease and cause to be terminated all existing
discussions, conversations, negotiations and other communications with any
Persons conducted heretofore with respect to any of the foregoing.




As used
in this Letter of Intent, “Person” means any
individual, partnership, firm, corporation, limited liability company,
association, trust, unincorporated organization or other entity, as well as any
syndicate or group that would be deemed to be a person under Section 13(d)(3) of
the Securities Exchange Act of 1934, as amended.




2




5.           Disclosure.  No
party to this Letter of Intent shall make, or cause to be made, any press
release or public announcement in respect of this Letter of Intent or the
transactions contemplated hereby or otherwise communicate with news media
without the prior consent of the other party, except as may be otherwise
required by applicable law or regulation, by any authorized administrative or
governmental agency or pursuant to applicable requirements of any listing
agreement with or the rules of any applicable securities
exchange.  The parties shall cooperate as to the timing and contents
of any such press releases or public announcements.




6.           Reimbursement of
Expenses.  The parties agree that each shall bear their own
expenses associated with this Letter of Intent and the establishment of the
relationship.




7.           Termination.  This
Letter of Intent may be terminated:




(i)           by
mutual consent of the Parties; or




(ii)          by
the Parties if the Agreement is not executed and delivered on or prior to April
30, 2009.




8.           Intentions of the
Parties.  This Letter of Intent constitutes only a preliminary,
non-binding statement of the intentions of the parties, does not contain all
matters upon which agreement must be reached for the relationship to be
consummated and, except as specified in the last sentence of this paragraph,
creates no legal obligations on the part of any party hereto.  A
binding commitment with respect to the relationship will result only from the
execution of the Agreement.  It is understood that (a) this Letter of
Intent does not constitute an obligation or commitment of any party to enter
into the Agreement, (b) any obligations or commitments to proceed with the
relationship shall be contained only in the Agreement and (c) the execution,
delivery and performance of the Agreement will require the approval of the
boards of directors of each Party.  Notwithstanding the foregoing, the
provisions of paragraphs 2 through 8 hereof will be fully binding upon the
execution hereof.




9.           Tax Treatment and Tax
Structure.  Notwithstanding anything herein to the contrary,
each party (and its representatives, agents and employees) may consult any tax
advisor regarding the tax treatment and tax structure of the transactions
contemplated hereby and , from and after the date of execution of an agreement
to enter into the transactions (or, if earlier, the date of public announcement
of such an agreement, or public announcement of discussions between the parties
relating to the transactions), may disclose to any person, without limitation of
any kind, the tax treatment and tax structure of the transactions and all
materials (including opinions or other tax analyses) that are provided relating
to such treatment or structure.




8.           Assignment.  This
Letter of Intent may not be assigned by operation of law or otherwise without
the express written consent of the Parties (which consent may be granted or
withheld in the sole discretion of either Party);




9.           No Third Party
Beneficiaries.  This Letter of Intent shall be binding upon and
inure solely to the benefit of the parties hereto and their permitted assigns
and nothing herein, express or implied, is intended to or shall confer upon any
other Person any legal or equitable right, benefit or remedy of any nature
whatsoever under or by reason of this Letter of Intent.




3




10.           Entire
Agreement.  This Letter of Intent constitutes the entire
agreement of the Parties hereto with respect to the subject matter hereof and
supersedes all other prior agreements and undertakings, both written and oral,
between the Parties with respect to the subject matter hereof.




11.           Amendment.  This
Letter of Intent may not be amended or modified except (a) by an instrument in
writing signed by, or on behalf of, the Parties or (b) by a waiver pursuant to
Section 15 below.




12.           Waiver.  Either
party to this Letter of Intent may (a) extend the time for the performance of
any obligations or other acts of the other party, (b) waive any inaccuracies in
the representations and warranties of the other party contained herein or in any
document delivered by the other party pursuant hereto or (c) waive compliance
with any of the agreements of the other party or conditions to such party’s
obligations contained herein.  Any such extension or waiver shall be
valid only if set forth in an instrument in writing signed by the party to be
bound thereby.  Any waiver of any term or condition shall not be
construed as a waiver of any subsequent breach or a subsequent waiver of the
same term or condition, or a waiver of any other term or condition of this
Letter of Intent.  The failure of any party to assert any of its
rights hereunder shall not constitute a waiver of any such rights.




13.           Severability.  If
any term or other provision of this Letter of Intent is invalid, illegal or
incapable of being enforced by any law or public policy, all other terms and
provisions of this Letter of Intent shall nevertheless remain in full force and
effect so long as the economic or legal substance of the transactions
contemplated by this Letter of Intent is not affected in any manner materially
adverse to any party.  Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the parties hereto
shall negotiate in good faith to modify this Letter of Intent so as to effect
the original intent of the parties as closely as possible in an acceptable
manner in order that the transactions contemplated by this Letter of Intent are
consummated as originally contemplated to the greatest extent
possible.




14.           Counterparts.  This
Letter of Intent may be executed and delivered (including by facsimile
transmission) in one or more counterparts, and by the different parties hereto
in separate counterparts, each of which when executed shall be deemed to be an
original, but all of which taken together shall constitute one and the same
agreement.




15.           Governing
Law.  This Letter of Intent shall be governed by, and construed
in accordance with, the laws of the State of Florida applicable to contracts
executed in and to be performed in that State.  Each of the parties
hereto hereby irrevocably and unconditionally consents to submit to the
exclusive jurisdiction of the courts of the State of Florida and of the United
States, in each case located in the County of Orange, for any litigation arising
out of or relating to this Letter of Intent (and agrees not to commence any
litigation relating thereto except in such courts), and further agrees that
service of any process, summons, notice or document by U.S. registered mail to
its respective address set forth in this Letter of Intent shall be effective
service of process for any litigation brought against it in any such
court.  Each of the parties hereto hereby irrevocably and
unconditionally waives any objection to the laying of venue of any litigation
arising out of this Letter of Intent in the courts of the State of Florida or
the United States, in each case located in the County of Seminole, and hereby
further irrevocably and unconditionally waives and agrees not to plead or claim
in any such court that any such litigation brought in any such court has been
brought in an inconvenient forum.




4




16.           Waiver of Jury
Trial.  Each of the parties hereto hereby waives to the fullest
extent permitted by applicable law any right it may have to a trial by jury with
respect to any litigation directly or indirectly arising out of, under or in
connection with this Agreement or the transactions contemplated by this
Agreement.  Each of the parties hereto (a) certifies that no
representative, agent or attorney of any other party has represented, expressly
or otherwise, that such other party would not, in the event of litigation, seek
to enforce that foregoing waiver and (b) acknowledges that it and the other
party hereto have been induced to enter into this Agreement and the transactions
contemplated by this Agreement, as applicable, by, among other things, the
mutual waivers and certifications in this Section 19.




If you
agree to work with us toward a definitive Agreement in accordance with the terms
set forth in this Letter of Intent, please indicate your acceptance by signing
in the space provided below.  We look forward to working with you
toward the completion of a mutually beneficial transaction.




Very
      truly yours,Signature
      Exploration & Production Corp.By
                      /s/ Steven WeldonName:  Steven
      Weldon,
CFO




Agreed
      and accepted as ofthe
      date first written above:Phoenix
      EnergyBy
                        /s/ Mark CasteelName:
      Mark CasteelBy
                        /s/ Joel SilverName:
      Joel
Silver




5