SUNRISE ENERGY RESOURCES, INC. 10% SUBORDINATED NOTE DUE March 30, 2009

      
    
Exhibit
      10.1
 
SUNRISE
      ENERGY RESOURCES, INC.

CD-1001
      

10%
      SUBORDINATED NOTE DUE March 30, 2009

This
      10%
      Note (hereinafter referred to as “the Note” or “the Notes”) is dated March 30,
      2006.


      

          
            Borrower:

            Sunrise
                Energy Resources, Inc.

          

    


      

          
            Address:
                

            000
                Xxxxx Xxxxxx, Xxxxx 000

          

    
New
      York,
      NY 10017

The
      word
“Borrower” means the original Borrower and anyone else who merges with the
      Borrower or assumes the Borrower’s obligations under this Note. However, the
      assumption of the Borrower’s obligations under this Note shall not release the
      Borrower from such obligations.


      

          
            Lender:

            Millington
                Solutions Limited

          

    


      

          
            Address:

            Suite
                000, 000 Xxxxxx Xxxxxx, Xxxxxx, X0X
                0XX

          

    

The
      Lender may transfer all or any part of this Note with written notice to the
      Borrower of the transfer, including the name, address of the transferee and
      the
      amount of the Note transferred. The Borrower may treat the Lender as the owner
      of this Note until the Borrower receives a written notice of a transfer of
      all
      or part of this Note to another Lender. The word “Lender” shall mean the
      original Lender and anyone else to whom this Note is transferred.

1.    Promise
      to Pay.
      In
      return for a loan in the amount of US$1,000,000
      (One million US dollars) that
      is
      received from the original Lender, the Borrower promises to pay to the Lender
      US$1,000,000
      (One million US dollars)
      (hereinafter referred to as “the Principal”), plus accrued interest at a rate of
10%
      (ten percent)
      per
      annum. The Borrower will repay the entire principal 3 (three) years from date,
      unless the Lender demands earlier payment under “Xxxxxx’s Right of Acceleration”
below or the parties agree to extend the due date. The Borrower may make earlier
      principal payments.

2.    Interest
      Payments.
      The
      Borrower will make annual interest payments to the Lender in the amount of
      $100,000
      (One hundred thousand US dollars),
      each
      payable on the first, second and third year anniversary of the Borrower’s
      receipt of each tranche. However, if an interest payment is due on a Saturday,
      Sunday or legal holiday, then the Borrower shall make the interest payment
      the
      next day.

3.    Xxxxxx’s
      Right of Acceleration.
      The
      Lender has the right, referred to as “the Lender’s Right of Acceleration”, to
      declare the entire unpaid principal and interest under this Note due immediately
      for any of the following reasons:


        
1

          
        

        


      

          
             
            (a)

            If
                the Borrower fails to make any payment of principal or interest within
                fifteen days after its due date.

          

    

      

          
             
            (b)

            If
                the Borrower fails to keep any other covenant made in this Note within
                thirty days after written notice from the
                Lender.

          

    

      

          
             
            (c)

            If
                one or more judgments is entered against the Borrower which exceed,
                in the
                aggregate, $100,000 if the Borrower does not pay such judgments or
                arrange
                for their enforcement to be postponed no later than within thirty
                days
                after the judgments have been
                entered.

          

    

      

          
             
            (d)

            If
                bankruptcy, receivership, or insolvency proceedings are started by
                or
                against the Borrower, or if the Borrower dissolves, liquidates or
                otherwise winds up its business.

          

    

4.    Agreement
      of Subordination.
      The
      Lender’s rights to receive payments of principal, interest and fees under this
      Note is subordinated to the prior payment of all loans or other extensions
      of
      credit made to the Borrower by any bank, savings and loan association, finance
      company, insurance company or any similar financial institution (such loans
      and
      extensions of credit, together with any interest or fees payable on or in
      connection with such loans and extensions of credit, are from now on called
      “Senior Indebtedness”) on the following types:


      

          
             
            (a)

            The
                Lender shall not be entitled to receive any principal, interest or
                fee
                payments, and the Borrower shall not make such payments, unless,
                at the
                time of such payment (i) the Borrower shall have paid all amounts
                due at
                such time under any Senior Indebtedness, and (ii) the Borrower shall
                not
                be in default under the terms of any Senior Indebtedness and payment
                of
                the amount due under this Note would not result in a default under
                any
                Senior Indebtedness. The word “default” includes defaults declared by
                holders of any Senior Indebtedness and any conditions, event or act
                which,
                with notice or the passage of time, would result in a default under
                any
                Senior Indebtedness.

          

    

      

          
             
            (b)

            If
                bankruptcy, receivership, or insolvency proceedings by or against
                the
                Borrower or its property occurs, or if the Borrower dissolves, liquidates
                its assets or otherwise winds up its business, the Borrower shall
                pay all
                outstanding Senior Indebtedness before making any payment of principal,
                interest or fees due under this Note. Any payments or distributions
                (including distributions of the Borrower’s non-cash assets or securities
                that would otherwise be made to the Lender will first be paid on
                account
                of all outstanding Senior
                Indebtedness.

          

    

      

          
             
            (c)

            If
                the Lender demands early payment of this Note for any reason, the
                Borrower
                shall first pay all outstanding Senior Indebtedness before making
                any
                payments under this note.

          

    

      

          
             
            (d)

            If
                the Lender receives any payment which is not entitled under this
                Note, the
                Lender shall hold such payment for the benefit of the holder of Senior
                Indebtedness and deliver such payment or distribution to the holders
                of
                Senior Indebtedness or their representatives for payment on account
                of all
                outstanding Senior Indebtedness.

          

    

      

          
             
            (e)

            After
                the Senior Indebtedness has been paid in full, the Lender shall be
                entitled to the rights of Senior Indebtedness to receive payments
                until
                all amounts due under this Note are paid in
                full

          

    


        
2

          
        

        

5.    Notices.
      All
      notices under this Note must be in writing. They may be given by (a) personal
      delivery, or (b) certified mail, return receipt requested. Each Party mush
      accept and claim the notices given by the other. Notices shall be addressed
      to
      the other party at the address written at the beginning of this Note, or, if
      the
      notice is to a Lender to whom this Note was transferred, the address stated
      in
      the notice to the Borrower of such transfer. Either party may notify the other
      of a change of address.


      

          
            6.

            Conversion
                of Convertible Notes.

          

    


      

          
            6.1.

            Right
                to convert.
                Subject to and upon compliance with the provisions of this Section
                6, at
                the option of the holder of any Notes, such Notes, or any portion
                of the
                principal amount thereof, may at any time at or before the close
                of
                business on the maturity date of such Notes be converted at 100%
                or so
                much of the principal amount of such Notes as are so converted into
                Common
                Stock at the Conversion Price, determined as hereinafter provided,
                in
                effect at the date of the
                conversion.

          

    


      

          
            6.2.

            Manner
                of Exercise of Conversion Privilege.
                In order to exercise the conversion privilege, the holder shall surrender
                this Note to the Company at any time during usual business hours
                at its
                principal office in New York City, accompanied by a written notice
                to the
                Company at such office or agency that the holder elects to convert
                this
                Note or a specified portion thereof and stating the name or names
                (together with the address) in which the certificate or certificates
                for
                shares of Common Stock which shall be issued upon conversion. All
                Notes
                surrendered for conversion shall (if so required by the Company)
                be
                accompanied by proper assignments thereof to the Company or be blank.
                As
                promptly as practicable after the receipt of such notice and the
                surrender
                of this Note as aforesaid the Company shall issue and deliver to
                the
                holder, or on his written order, a certificate or certificates for
                the
                number of full shares of Common Stock issuable on such conversion
                in
                accordance with the provision of this Article and cash, as provided
                in
                Subsection 3, in respect of any fraction of a share of Common Stock
                otherwise issuable upon such conversion. Such conversion shall be
                deemed
                to have been effected at the close of business on the Date of Conversion,
                and the person or persons in whose name or names any certificate
                or
                certificates for shares of Common Stock shall be issuable upon such
                conversion shall be deemed to have become the holder or holders of
                record
                of the shares represented thereby on such date; provided, however,
                that
                any such surrender on any date when the stock transfer books of the
                Company shall be closed shall constitute the person or persons in
                whose
                name or names the certificate or certificates for such shares are
                to be
                issued as the record holder or holders thereof for all purposes at
                the
                close of business on the next succeeding day on which such stock
                transfer
                books are open, and the Note surrendered shall not be deemed to have
                been
                converted until such time for all purposes, but such conversion shall
                be
                at the conversion price in effect at the close of business on the
                date of
                such surrender. Anything contained in this Section 6.2 to the contrary
                notwithstanding, the Company shall not be obligated to effect the
                transfer
                of any Conversion Shares upon conversion of any portion of any Notes
                or
                cause any Conversion Shares upon conversion of any Notes to be registered
                in any name or names other than the name of the holder of the Notes,
                converted or to be converted (or such holder’s nominee or nominees) unless
                such holder delivers to the Company an opinion of counsel reasonably
                satisfactory to the Company to the effect that such transfer is in
                compliance with applicable securities
                laws.

          

    


        
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In
      case
      any Note is surrendered for conversion for only a portion of the principal
      amount thereof, the Company shall execute and deliver to the holder of such
      Note, at the expense of the Company, a new Note in the denomination or
      denominations ($1,000 and integral multiples thereof, plus one Note in a lesser
      denomination, if required) as such holder may request in an aggregate principal
      amount equal to the unconverted portion of the Note so surrendered.


      

          
            6.3.

            Fractions
                of Share.
                The Company shall not be required to issue fractions of a share or
                scrip
                representing fractional shares of Common Stock upon conversion of
                the
                Note. If any fraction of a share of Common Stock would, except for
                the
                provisions of this Section be issuable on the conversion of any Notes
                (or
                specified portions thereof), the Company shall pay a cash adjustment
                in
                respect of such fraction, equal to the value of such fraction based
                on the
                then Conversion Price.

          

    


      

          
            6.4.

            Conversion
                Ratio and Conversion Price.
                

          

    


      

          
             
            (i)

            The
                price at which shares of Common Stock shall be delivered upon conversion
                (herein called the Conversion Price) shall initially be US$2.20 (Two
                US
                dollars and two cents) per share of Common
                Stock.

          

    

      

          
             
            (ii)

            Each
                US$1000 Note unit shall be convertible into 454 shares of the Borrower’s
                common stock.

          

    

      

          
             
            (iii)

            The
                Conversion Price in effect or to be in effect at any time shall be
                subject
                to adjustment from time to time as provided in subsection
                6.5.

          

    


      

          
            6.5

            Adjustment
                of Conversion Price and Number of Shares of Common Stock Issuable
                upon
                Conversion of the Notes.
                Upon each adjustment of the Conversion Price, the Note Holders shall
                thereafter be entitled to purchase, at the conversion price resulting
                from
                such adjustment, the number of shares obtained by multiplying the
                Conversion Price in effect immediately prior to such adjustment by
                the
                number of shares purchasable pursuant hereto immediately prior to
                such
                adjustment and dividing the product thereof by the conversion price
                resulting from such adjustment.

          

    

The
      Conversion Price shall be subject to adjustment from time to time as
      follows:

A.
      In
      case the Company at any time or from time to time after the date hereof (I)
      issues or sells any additional shares of Common Stock for a consideration per
      share less than the Conversion Price in effect immediately prior to the issue
      or
      sale of such additional shares, or without consideration, or (II) pay or make
      a
      dividend (other than in cash payable from retained earnings or earned surplus)
      or other distribution on Common Stock, then and thereafter successively upon
      each such issue, sale, dividend or other distribution, the Conversion Price
      for
      each share of Common Stock in effect immediately prior to such issue, sale,
      dividend or other distribution shall forthwith be reduced to a price (calculated
      to the nearest full cent) equal to the quotient obtained by dividing (i) an
      amount equal to the sum of (a) the total number of shares of Common Stock
      outstanding immediately prior to such issue sale, dividend or other distribution
      multiplied by such Conversion Price in effect immediately prior to such issue,
      sale, dividend or other distribution, plus (b) in the case of such an issue
      or
      sale, the consideration, if any, received by the Company upon such issue or
      sale, or minus (c) in the case of such a dividend or other distribution, the
      amount of such dividend or other distribution, by (ii) the total number of
      shares of Common Stock outstanding immediately after such issue, sale, dividend
      or other distribution.


        
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The
      Company shall not be required to make any adjustment of the Conversion Price
      if
      the amount of such adjustment shall be less than $0.001 per share, but in such
      case any adjustment that would otherwise be required then to be made shall
      be
      carried forward and shall be made at the time and together with any adjustment
      so carried forward, shall amount to not less than $0.001 per share.

For
      the
      purpose of any adjustment as provided in this subsection A, the following
      provisions shall also be applicable:

(i)    In
      case
      of the issue of additional shares of Common Stock for cash, the consideration
      received by the Company therefore shall be deemed to be the cash proceeds
      received by the Company for such shares, without deduction therefrom of any
      expenses incurred or any underwriting commissions or concessions paid or allowed
      by the Company in connection therewith.

(ii)   In
      case
      at any time the Company shall grant any rights to subscribe for or to purchase,
      or any options for the purchase of, Common Stock or any stock or other
      securities convertible into or exchangeable for Common Stock (such convertible
      or exchangeable stock or securities being herein called “Convertible
      Securities”), whether or not such rights or options or the rights to convert or
      exchange any such Convertible Securities are immediately exercisable, and the
      price per share for which Common Stock is issuable upon the exercise of such
      rights or options or upon conversion or exchange of such Convertible Securities,
      

(iii)   In
      case
      at any time the Company shall declare a dividend or make any other distribution
      upon any stock of the Company payable in Common Stock or Convertible Securities,
      any Common Stock or Convertible Securities, as the case may be, issuable in
      payment of such dividend or distribution shall be deemed to have been issued
      or
      sold without consideration.

(iv)   In
      case
      any shares of Common Stock or Convertible Securities or any rights or options
      to
      purchase any such Common Stock or Convertible Securities shall be issued or
      sold, in whole or in part, for a consideration other than cash, the amount
      of
      the consideration other than cash received by the Company shall be deemed to
      be
      the fair value of such consideration as determined by the Board of Directors
      of
      the Company.


        
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(v)   In
      the
      event of the consolidation of the Company with or the merger of the Company
      into
      any other corporation or of the sale of the properties and assets of the Company
      as, or substantially as, an entirety for stock or other securities of any
      corporation, or the merger of any other corporation into the Company as a result
      of which the holders of shares of Common Stock of the Company shall be deemed
      to
      have become the holders of, or shall become entitled to, stock or other
      securities of any corporation other than the Company, the Company shall be
      deemed to have issued a number of shares of its Common Stock for such stock
      or
      securities computed on the basis of the exchange ratio actually applied in
      the
      transaction and for a consideration equal to the fair market value on the date
      of such transaction of such stock or securities of the other corporation. If
      such determination shall cause an adjustment in the Conversion Price, the
      determination of the number of shares of Common Stock issuable upon the
      conversion of any Convertible Note immediately prior to such consolidation,
      merger or sale for the purpose of subsection (iii) of this subsection 6.5 shall
      be made after giving effect to such adjustment of the Conversion
      Price.

(vi)   In
      case
      of the payment or making of a dividend or other distribution on Common Stock
      in
      property (other than in shares of Common Stock and securities convertible into
      or exchangeable for shares for Common Stock, but including all other securities)
      such dividend or other distribution shall be deemed to have been paid or make
      at
      the close of business at the record date fixed for the determination of
      stockholders entitled to receive such dividend or other distribution shall
      be
      the amount of cash and, if in property other than cash, shall be deemed to
      be
      the value of such property as determined in good faith by the Board of Directors
      of the Company at the time of the declaration of such dividend or other
      distribution.

(vii)   The
      number of shares of Common Stock outstanding at any given time shall not include
      shares owned or held by or for the account of the Company, and the disposition
      of any such shares shall be considered an issue of sale of Common
      Stock.

B. 
       Anything to the contrary notwithstanding, the Company shall not be
      required to make any adjustment of the Conversion Price in any of the following
      events:

(i)    The
      issue
      of the Convertible Notes of which this note is a part;

(ii)   The
      issue
      of shares of Common Stock upon the conversion from time to time of the
      Notes;

(iii)   The
      issue
      of not more than 1,000,000 shares of Common Stock upon the exercise of options
      granted under the Company’s Employee’s Qualified Stock Option Plan;

(iv)   The
      issue
      of non-qualified stock options (and the issuance of shares upon the exercise
      thereof) by the Company to its officers and employees for not exceeding an
      aggregate of 1,000,000 shares of Common Stock;


        
6

          
        

        

(v)   Such
      additional shares as may be issuable upon the exercise of such options by reason
      of stock dividends, stock splits, and other changes in the capitalization of
      the
      Company; and

C. 
       In case at any time the Company’s shares shall be combined into a small
      number of shares, the conversion price in effect immediately prior to such
      combination shall remain unchanged.

D.  If
      any capital reorganization or reclassification of the capital stock of the
      Company, or consolidation or merger of the Company with another corporation,
      or
      the sale of all or substantially all of its assets to another corporation shall
      be effected in such a way that holders of Common Stock (or any other securities
      of the Company then issuable upon the conversion of this Note) shall be entitled
      to receive stock, securities or assets with respect to or in exchange for Common
      Stock (or such other securities) then, as a condition of such reorganization,
      reclassification, consolidation, merger or sale, lawful and adequate provision
      shall be made whereby the holder hereof shall thereafter have the right to
      purchase and receive upon the basis and upon the terms and conditions specified
      in this Convertible Note and in lieu of the shares of the Common Stock (or
      other
      securities) of the Company immediately theretofore purchasable and receivable
      upon the exercise of the rights represented hereby, such shares of stock,
      securities or assets as my be issued or payable with respect to or in exchange
      for a number of shares of such Common Stock (or such other securities)
      immediately theretofore purchasable and receivable upon the exercise of the
      rights represented hereby, had such reorganization, reclassification,
      consolidation , merger or sale not taken place, and in any case appropriate
      provision shall be made with respect to the rights and interest of the holder
      of
      this Convertible Note to the end that the provisions hereof (including without
      limitation provisions fro adjustments of the conversion price and of the number
      of shares purchasable upon the conversion of this Note) shall thereafter be
      applicable, as nearly as may be, in relation to any shares of stock, securities
      or assets thereafter deliverable upon the conversion hereof (including an
      immediate adjustment, by reason of such consolidation, merger or sale, of the
      conversion price, to the value for the Common Stock reflected by the terms
      of
      such consolidation, merger or sale if the value so reflected is less than the
      conversion price in effect immediately prior to such consolidation, merger
      or
      sale). The Company shall not effect any such consolidation, merger or sale,
      unless prior to the consummation thereof the successor corporation (if other
      than the Company) resulting from such consolidation or merger or the corporation
      purchasing such assets shall assume, by written instrument executed and mailed
      to the registered holder hereof at the last address of such holder appearing
      on
      the books of the Company, the obligation to deliver to such holder such shares
      of stock, securities or assets, as, in accordance with the foregoing provisions,
      such holder may be entitled to purchase. The successor corporation shall be
      deemed substituted for the Company for all purposes of this Agreement and the
      Convertible Notes.

The
      provisions of subsection D governing the substitution of another corporation
      for
      the Company shall similarly apply to successive instances in which the
      corporation then deemed to be the Company hereunder shall either sell all or
      substantially all of its properties and assets to any other corporation or
      shall
      be the surviving corporation of the merger into it of any other corporation
      as a
      result of which the holders of any of its tock or other securities shall be
      deemed to have become the holders of, or shall become entitled to, the stock
      or
      other securities of any corporation other than the corporation at the time
      deemed to be the Company hereunder.


        
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            6.6

            Notice
                of Conversion Price.
                Upon any adjustment of the conversion price, than and in each such
                case
                the Company shall give written notice thereof, to the holder thereof,
                which notice shall state the conversion price resulting from such
                adjustment and the increase or decrease, if any, in the number of
                shares
                purchasable at such price upon the exercise of this Convertible Note,
                setting forth in reasonable detail the method of calculation and
                the facts
                upon which such calculation is
                based.

          

    

The
      Company will, within 90 days after the end of each of its fiscal years, and
      at
      such other times as the Holder may reasonably request, mail to the holder of
      each Convertible Note at the address of such holder shown on the books of the
      Company a certificate of the independent public accountants for the Company
      specifying the Conversion Price in effect as the end of such fiscal year and
      the
      number of shares of Common Stock, or the kind and amount of any securities
      or
      property other than Common Stock or both, issuable upon the conversion of the
      Convertible Notes.


      

          
            6.7

            Notice
                of Distributions, Rights of Reorganization, Etc.
                In case at any time:

          

    

(1)    the
      Company pays any dividend payable in stock upon its Common Stock or make any
      distribution (other than regular cash dividend) to the holders of its Common
      Stock;

(2)    the
      Company shall offer for subscription pro rata to the holders of its Common
      Stock
      any additional shares of stock of any class or other rights;

(3)    there
      shall be any capital reorganization, or reclassification of the capital stock
      of
      the Company, or consolidation or merger of the Company, or sale of all or
      substantially all of its assets to, another corporation; or

(4)    there
      shall be a voluntary or involuntary dissolution, liquidation or winding up
      of
      the Company;

then
      in
      any one or more of said cases, the Company shall give written notice, to the
      holder of this Convertible Note, of the date on which (a) the books of the
      Company shall close or a record shall be taken for such dividend, distribution
      or subscription rights, or (b) such reorganization, reclassification,
      consolidation, merger, sale, dissolution, liquidation or winding up shall take
      place, as the case may be. Such notice shall also specify the dates as of which
      the holders of Common Stock of record shall participate in such dividend,
      distribution or subscription rights, or shall be entitled to exchange their
      Common Stock for securities or other property deliverable upon such
      reorganization, reclassification, consolidation, merger, sale, dissolution,
      liquidation or winding up, as the case may be. Such written notice shall be
      given at least 20 days prior to the record date or the date on which the
      Company’s transfer books are closed in respect thereto.


        
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            6.8

            Taxes
                on Conversion.
                The issue of stock certificates on conversion of the Notes shall
                be made
                without charge to the converting Noteholder for any tax in respect
                of the
                issue thereof. The Company shall not, however, be required to pay
                any tax
                which may be payable in respect of any transfer involved in the issue
                and
                delivery of stock in any name other than that of the holder of any
                Note
                converted, and the Company shall not be required to issue or deliver
                any
                certificate in respect to such stock unless and until the person
                or
                persons requesting the issuance thereof shall have paid to the Company
                the
                amount of such tax or shall have established to the satisfaction
                of the
                Company that such tax has been
                paid.

          

    


      

          
            6.9

            Company
                to Reserve Stock.
                The Company shall at all times reserve and keep available out of
                its
                authorized but unissued stock, for the purpose of effecting the conversion
                of the Notes, such number of its duly authorized shares of Common
                Stock as
                shall from time to time be sufficient to effect the conversion of
                all
                outstanding Notes. If any shares of Common Stock, reserved or to
                be
                reserved, for such purposes, required registration under any Federal
                or
                state law before such shares may be validly issued to the holder,
                the
                Company covenants that it will in good faith and as expeditiously
                as
                possibly endeavor to secure such registration or approval, as the
                case may
                be.

          

    

The
      Company will not take any action which would cause the conversion price to
      be
      below the then par value, if any, per share of the Common Stock, or in the
      case
      of no-par stock, below the amount for which such shares may be issued as fully
      paid and nonassesable.

The
      Company covenants that all shares of Common Stock which may be issued upon
      conversion of Notes will upon issue be fully paid and nonassessable and free
      from all taxes, liens and charges with respect to the issue
      thereof.


      

          
            6.10

            No
                Rights as Stockholders.
                Prior to the conversion of any Note, the holder of such Note shall
                not be
                entitled to any rights of a stockholder of the Company, including
                without
                limitation the right to vote, to receive dividends or other distributions
                or to exercise any pre-emptive rights, and shall not be entitled
                to
                receive any notice of any proceedings of the Company, except as provided
                herein.

          

    

7.
      Representations and Warranties of Corporation


      

          
            7.1

            The
                Ñompany
                represents that it is a corporation duly organized, validly existing
                under
                the laws of the State of Delaware. The Company is authorized to issue
                the
                Notes subscribed to by this instrument. Upon payment for the Notes,
                the
                original Lender shall be the owner of duly and validly issued Notes.
                Delivery of the Note Certificates to the original Lender shall mean
                transfer to the Original Lender the title and the right to sell the
                Notes,
                the rights to receive interest and principal payments, rights to
                convert
                the Notes into Common Stock, as well as other rights as envisaged
                by the
                Articles of the Corporation and the US laws.

          

    


        
9

          
        

        

8.
      Representations and Warranties of the Lender 


      

          
            8.1

            Lender’s
                Organization.
                The Lender is duly organized, validly existing, and in good standing,
                operating pursuant to the laws of the United Kingdom, and has all
                requisite corporate power and authority to carry on its business
                as
                currently conducted. The Lender is also empowered and authorized
                to
                purchase the Notes for which it is subscribing.

          

    


      

          
            8.2

            Private
                Sale.
                The Lender understands that this is a private offering. The Notes
                have not
                been registered under the Act and are being acquired by the Lender
                for
                investment. The Lender understands that it may not sell the Notes
                without
                compliance with the Act, applicable portions of which are explained
                below.

          

    


      

          
            8.3

            Compliance
                with Securities Act of 1933.
                The Lender understands that the Notes it is acquiring are sold in
                reliance
                upon an exemption from such registration requirements afforded by
                Regulation S, governing the offer and sale of securities that occur
                outside the U.S. Regulation S provides that Notes, sold pursuant
                to the
                exemption provided by that Regulation, within one (1) year after
                completion of Notes purchasing under this Contract (hereinafter referred
                to as the “Restricted Period”), must not be sold without any solicitation
                or other efforts to sell the Notes or any re-sale into the United
                States.
                

          

    

9.
      No U.S. Distribution.


      

          
            9.1

            Lender
                is not a US Person. The Lender represents that is not a U.S. person
                as
                defined in Regulation S, promulgated under the Act. The Lender may
                be a
                “distributor” as defined in Regulation S.

          

    


      

          
            9.2
            No
                Solicitations or Sales to US Person..
                The Lender acknowledges that the Notes cannot be sold in the United
                States
                as part of a United States "distribution" (as such term is defined
                in the
                federal securities laws of the United States). The Lender has not
                offered
                the Notes to any person in the United States or to any U.S. Person
                as that
                term is defined in Regulation S. The Lender has no reason to believe
                that the purchase of the Notes has been pre-arranged with a Lender
                in the
                United States. The Lender has not engaged in any "directed selling
                efforts" (as that term is defined in Regulation S) to re-sell the
                Notes
                into the United States or to US Persons; nor has the Lender conducted
                any
                general solicitation to sell the Shares to persons residing within
                the
                United States or to U.S. Persons. The Lender agrees that to the extent
                that it is a distributor, all offers and sales of the securities
                prior to
                the expiration of the registration period shall be made only in accordance
                with the provision of Rule 903 and Rule 904 under Regulation S; pursuant
                to registration of the shares under the Act, or pursuant to an exemption
                from the registration requirements of the
                Act.

          

    

10.
      Restrictive Period Conditions


      

          
            10.1.
                

            Any
                transfer of the Notes resulting in violating the terns of this Agreement
                shall be void. All and any Note transfers by the secretary of the
                Corporation or by its transfer agent with making notes in the Securities
                Transfer Register of the Corporation shall be carried out only in
                compliance with the provisions of this Agreement.
                

          

    


        
10

          
        

        


      

          
            10.2.
            During
                the Restricted Period the Corporation will: refrain from publishing
                or
                disseminating any material in connection with the offering of the
                Notes in
                the United States; ensure that all Offering Restrictions as defined
                in
                Regulation S applicable to the sale of Notes pursuant to this Contract
                are
                thoroughly complied with and satisfied; and refrain from engaging,
                and
                insure that none of its branches or affiliates will engage, in any
                Directed Selling Efforts as defined in Regulation S with respect
                to the
                Notes.

          

    


      

          
            10.
                3

            Lender's
                Investigation.
                The Lender has been given a reasonable opportunity to ask questions
                of and
                receive answers from the Corporation concerning the Corporation and
                the
                Notes for which it is subscribing. The Lender has such knowledge
                and
                expertise in financial and business matters that the Lender is capable
                of
                evaluating the merits and risks involved in an investment in the
                Notes.
                The Lender shall not rely on any received information apart from
                that,
                which is given in this Contract, as well as on the information, resulting
                from any independent study of the Corporation conducted by the Lender.
                

          

    

Xxxxxx
      and signed on this date: March 30, 2006 by Xxxxxxxx and Xxxxxx.
 

      

          
            Borrower:

            Sunrise
                Energy Resources, Inc.

          

    

 

      

          
            Signature:
            /x/
                Xxxxxxxxxx
                Xxxxxxxxxxxx                    
                    

          

    


      

          
            Name:
            Xxxxxxxxxx
                Xxxxxxxxxxxx 

          

    


      

          
            Title:

            CEO

          

    



      

          
            Lender:

            Millington
                Solutions Limited

          

    



      

          
            Singnature:
            /x/
                Xxxxxxx
                Xxxxxx                                  
                 
                   

          

    


      

          
            Name:

            Xxxxxxx
                Xxxxxx

          

    


      

          
            Title:

            Director

          

    
 
 
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Table of Contents

SUNRISE ENERGY RESOURCES, INC. 10% SUBORDINATED NOTE DUE March 30, 2009

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