ILX RESORTS INC
SECOND AMENDMENT TO OPERATING AGREEMENT
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<DESCRIPTION>SECOND AMENDMENT TO OPERATING AGREEMENT
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<TITLE>SECOND AMENDMENT TO THE</TITLE>
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<DIV style="width:576px"><P style="line-height:21.333px; margin:0px; font-size:18.667px" align=center><B>SECOND AMENDMENT TO THE</B></P>
<P style="line-height:21.333px; margin:0px; font-size:18.667px" align=center><B>OPERATING AGREEMENT</B></P>
<P style="line-height:21.333px; margin:0px; font-size:18.667px" align=center><B>OF</B></P>
<P style="line-height:21.333px; margin:0px; font-size:18.667px" align=center><B>ILX-BRUNO L.L.C.</B></P>
<P style="line-height:18.667px; margin:0px; font-size:16px" align=center><B>An Arizona limited liability company</B></P>
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<P style="line-height:18.667px; margin:0px; text-indent:48px; font-size:16px" align=justify><B>This Second Amendment to the Operating Agreement </B>of ILX-Bruno LLC, an Arizona limited liability company (Second Amendment) is entered into effective as of the 24<SUP>th</SUP> day of July, 2006, by and among ILX Resorts Incorporated, an Arizona corporation (&#147;ILX&#148;) as a Member and as the Manager and James Bruno Enterprises LLC, an Arizona limited liability company as a Member (Bruno).</P>
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<P style="line-height:18.667px; margin-top:0px; margin-bottom:-18.667px; padding-left:96px; text-indent:-48px; font-size:16px" align=justify>1.</P>
<P style="line-height:18.667px; margin:0px; padding-left:96px; font-size:16px" align=justify><B><U>Amendment.</U></B> &nbsp;Paragraph 3.2.1 ( l ) of the Restated First Amendment to the Operating Agreement of ILX-Bruno LLC, an Arizona limited liability company (Restated First Amendment) effective as of the 27th &nbsp;day of September 2005, is amended in full as set forth below:</P>
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<P style="line-height:18.667px; margin:0px; padding-left:96px; font-size:16px" align=justify>&#148;Bruno shall contribute an additional Capital Contribution of $400,000 in good funds by wire to the bank of the Company on or before 2:00 P.M. Mountain Standard Time on Monday, July 24, 2006, for working capital purposes. &nbsp;Additionally, Bruno shall similarly wire $400,000 to purchase a 2.0% Percentage Interest from ILX, which funds shall be distributed immediately to ILX. &nbsp;As of the date such funds are received by the Company as aforesaid, the Percentage Interests shall be ILX Resorts Incorporated 88.0% and James Bruno Enterprises LLC 12.0%&#148;. &nbsp;</P>
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<P style="line-height:18.667px; margin-top:0px; margin-bottom:-18.667px; padding-left:72px; text-indent:-24px; font-size:16px" align=justify><B><U>2.</U></B></P>
<P style="line-height:18.667px; margin:0px; padding-left:72px; font-size:16px" align=justify><B><U>Full Force and Effect.</U></B> &nbsp;Except as modified by this Second Amendment, the Operating Agreement and Restated First Amendment and each of their respective terms and conditions remain in full force and effect.</P>
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<P style="line-height:18.667px; margin-top:0px; margin-bottom:-18.667px; font-size:16px" align=justify>Members:</P>
<P style="line-height:18.667px; margin:0px; text-indent:288px; font-size:16px" align=justify>Manager:</P>
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<P style="line-height:18.667px; margin-top:0px; margin-bottom:-18.667px; font-size:16px" align=justify>JAMES BRUNO ENTERPRISES, LLC</P>
<P style="line-height:18.667px; margin:0px; text-indent:288px; font-size:16px" align=justify>ILX RESORTS INCORPORATED,</P>
<P style="line-height:18.667px; margin-top:0px; margin-bottom:-18.667px; font-size:16px" align=justify>An Arizona limited liability company</P>
<P style="line-height:18.667px; margin:0px; text-indent:288px; font-size:16px" align=justify>An Arizona corporation</P>
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<P style="line-height:18.667px; margin-top:0px; margin-bottom:-18.667px; font-size:16px" align=justify>By: &nbsp;____________________________</P>
<P style="line-height:18.667px; margin:0px; text-indent:288px; font-size:16px" align=justify>By: &nbsp;____________________________</P>
<P style="line-height:18.667px; margin-top:0px; margin-bottom:-18.667px; text-indent:24px; font-size:16px" align=justify>&nbsp;James A. Bruno</P>
<P style="line-height:18.667px; margin:0px; text-indent:288px; font-size:16px" align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Joseph P. Martori, Sr.</P>
<P style="line-height:18.667px; margin-top:0px; margin-bottom:-18.667px; font-size:16px" align=justify>Its: &nbsp;Manager</P>
<P style="line-height:18.667px; margin:0px; text-indent:288px; font-size:16px" align=justify>Its: &nbsp;Chairman and CEO</P>
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<P style="line-height:18.667px; margin:0px; font-size:16px" align=justify>By: &nbsp;____________________________</P>
<P style="line-height:18.667px; margin:0px; font-size:16px" align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Shelly D. Bruno</P>
<P style="line-height:18.667px; margin:0px; font-size:16px" align=justify>Its: &nbsp;&nbsp;Manager</P>
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<P style="line-height:18.667px; margin:0px; font-size:16px" align=justify>ILX RESORTS INCORPORATED, </P>
<P style="line-height:18.667px; margin:0px; font-size:16px" align=justify>An Arizona corporation</P>
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<P style="line-height:18.667px; margin:0px; font-size:16px" align=justify>By: &nbsp;____________________________</P>
<P style="line-height:18.667px; margin:0px; font-size:16px" align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Joseph P. Martori, Sr.</P>
<P style="line-height:18.667px; margin:0px; font-size:16px" align=justify>Its: &nbsp;&nbsp;Chairman and CEO</P>
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