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**SUNRISE      ENERGY RESOURCES, INC.**

**CD-1009**

** 10%      SUBORDINATED NOTE DUE JUNE 6, 2009**

**Promise      to Pay**
**US$2,000, 000 (Two million US dollars) **
**US$2,000,000 (Two million US dollars)**
**10% (ten      percent)**

**Interest      Payments**

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**Lender’s      Right of Acceleration**

|   | (a) | If                the Borrower fails to make any payment or principal or interest within                fifteen days after its due date. |
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|   | (b) | If                the Borrower fails to keep any other covenant made in this Note within                thirty days after written notice from the                Lender. |
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|   | (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. |
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|   | (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. |
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**Agreement      of Subordination**

|   | (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. |
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|   | (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. |
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|   | (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. |
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|   | (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. |
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|   | (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 |
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**Notices**

**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. |
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| 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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| 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. |
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| 6.4. | **Conversion                Price**. |
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|   | (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. |
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|   | (ii) | Each                US$1000 Note Unit shall be convertible into 454 shares of the Borrower’s                common stock. |
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|   | (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. |
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| 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. |
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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. |
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| 6.7 | **Notice                of Distributions, Rights of Reorganization, Etc**.  In                case at any time: |
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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. |
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| 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. |
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| 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. |
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**7.      Representations and Warranties of Corporation**

| 7.1 | The                Сompany                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. |
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**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. |
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| 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. |
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| 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. |
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**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. |
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|   | 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. |
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**10.      Restrictive Period Conditions**

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| 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. |
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| 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. |
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| 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. |
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**Borrower:    Sunrise      Energy Resources, Inc.**

**Lender:             Millington Solutions Limited**

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