Class C Interest on Conversion

The convertible note holder may exercise the warrant option to convert the principal amount of the convertible debenture note into LLC interest in ownership equity on notice at the marturity of the note. The noteholder will be required to give the LLC notice with 15 days after maturity of their note to convert their interest into equity. The conversion rate is 1:1 ratio, each dollar of principal amount of the debenture note will be exchanged for 1 interest in the LLC.

The Sun Valley Club, LLC, Class C interest will be subscribed upon maturity of the Convertible Debenture Notes on notice from the holder to convert their increments into 20,000 interest per unit of investment in exchange for $20,000. increments of convertible debenture notes that have matured. The units of interest in the LLC will be issued upon notice from the debenture holder, after the Warrant option is exercised, to convert the debenture into Class C units of interest.

The benefits of converting the note to equity provides for a preferential return on the the investment amount at a rate of 8% preferential interst (simple interest) paid monthly, quarterly or at the discretion of the Managing Members and a proportionate share of profits, losses, gains and deductions. Tax Reporting 1065/K1.