EXHIBIT 10.1
X-CHANGE CORPORATION
IRREVOCABLE SUBSCRIPTION AGREEMENT
FEBRUARY-MARCH 2007
1. SUBSCRIPTION. Subject to the terms and conditions hereof, the
undersigned (hereinafter referred to as the "SUBSCRIBER") irrevocably
tenders this "Subscription" and hereby subscribes for the number of
Units (as defined in the Offering Memo) set forth on the signature page
hereto as described in the Confidential Private Placement Memorandum
attached hereto as EXHIBIT A (the "OFFERING MEMO").
2. ACCEPTANCE OF SUBSCRIPTION. This Subscription Agreement shall not
become binding unless (i) this Subscription Agreement is accepted by
the Company, (ii) the Subscription Amount has been received and
accepted by the Company, and (iii) such additional closing conditions
as the Company, in its sole discretion, shall require are satisfied.
This Subscription shall not be deemed accepted by the Company until
this Subscription Agreement is signed by a duly authorized officer of
the Company and returned to Subscriber. If this Subscription is
accepted, this Subscription Agreement shall become effective as between
the Company and the Subscriber. If this Subscription is rejected, this
Subscription Agreement and the Subscription Amount will be returned to
the Subscriber as soon as reasonably practicable, and this Subscription
shall be rendered void and of no further force or effect.
3. ANCILLARY DOCUMENTS. In connection with its subscription, Subscriber
has executed and delivered the Registration Rights Agreement in the
form attached hereto as EXHIBIT B (which the Company will counter-sign
and deliver to Subscriber if it agrees to accept Subscriber's
subscription) and the Confidentiality Agreement in the form attached
hereto as EXHIBIT C.
4. REPRESENTATIONS AND WARRANTIES OF SUBSCRIBER. Subscriber hereby
represents and warrants to the Company as follows:
A. The Subscriber is an "accredited investor" (as defined on EXHIBIT D
hereto) and is domiciled in the state indicated on the signature page
hereto.
B. The Securities hereby subscribed for are being acquired by
Subscriber as the ultimate owner, in good faith, for Subscriber's own
account, not as a conduit, underwriter, nominee or agent for other
beneficial or subsequent owners, and not with a view to the resale or
distribution of any part thereof; Subscriber has no present intention
of selling, granting any participation in, or otherwise distributing
the same and has no contract, undertaking, agreement or arrangement
with any person to transfer, encumber, or grant participations to any
person, with respect to any of the Securities. The Subscriber warrants
that any funds which may be tendered for the purchase of Securities
will not represent funds borrowed by the Subscriber from any person or
lending institution except to the extent that the Subscriber has a
source for repaying such funds other than from the sale of the
Securities subscribed, and that such Securities have not been pledged
or otherwise hypothecated for any such borrowing.
C. Subscriber has received and carefully reviewed a copy of the
Offering Memo and agrees that it, along with all information regarding
the Company that is publicly available, supersedes any offering memos
or other materials that the Company previously provided to Subscriber,
if any.
D. Subscriber acknowledges that he has been advised that the Securities
have not been registered under the Act, as amended, or under the
provision of any state securities laws, on the grounds that the offer
and sale of the Securities is exempt from registration under the
provisions of those Statutes as not involving any public offering.
E. Subscriber acknowledges that the Subscriber has had the reasonable
opportunity to ask questions and receive answers concerning the
offering of the Securities and to obtain additional information
necessary to verify the accuracy of the information furnished in the
Offering Memo.
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4. SUCCESSORS AND ASSIGNS. The Subscriber agrees that this Subscription
Agreement shall be binding upon and inure to the benefit of all the
parties hereto and their respective heirs, legal representatives,
successors and assigns.
5. INDEMNIFICATION. Subscriber understands and is aware of the
significance to the Company of the foregoing representations,
agreements and consents, and they are made with the intention that the
Company may rely upon them. Subscriber acknowledges that he understands
the meaning and legal consequences of the representations and
warranties herein, and he hereby agrees to indemnify and hold harmless
the Company and its officers, affiliates, agents and employees of the
Company, and the persons who have solicited this subscription, from and
against any and all loss, damage or liability, including but not
limited to legal fees and court costs, due to or arising out of a
breach of any such representations or warranties made by the
Subscriber.
7. NUMBER AND GENDER. Whenever the singular number is used in this
Subscription Agreement and when required by the context, the same shall
include the plural, and the masculine gender shall include the feminine
and neuter genders.
9. APPLICABLE LAW. This Subscription Agreement shall be governed by, and
construed in accordance with, the laws of the State of Texas, without
regard to principles of conflicts of laws. Any dispute under this
Subscription Agreement that is not settled by mutual consent shall be
finally adjudicated by any federal or state court sitting in Dallas
County or Collin County, Texas, and each party consents to the
exclusive jurisdiction of such courts (or any appellate court
therefrom) over any such dispute. Each party further consents to
personal jurisdiction in the courts mentioned in the prior sentence. In
the event that any suit or action is instituted to enforce any
provision in this Subscription Agreement, the prevailing party in such
dispute shall be entitled to recover from the losing party all fees,
costs and expenses of enforcing any right of such prevailing party
under or with respect to this Subscription Agreement, including without
limitation, such reasonable fees and expenses of attorneys and
accountants, which shall include, without limitation, all fees, costs
and expenses of appeals.
(THIS SPACE WAS INTENTIONALLY LEFT BLANK)
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IN WITNESS WHEREOF, SUBJECT TO ACCEPTANCE OF THIS SUBSCRIPTION AGREEMENT BY THE
COMPANY, the Subscriber executes and agrees to all the terms of this
Subscription Agreement.
Date: _____________________
$$ Investment: $_____________________
For ______ Units (or ______________ shares of Common Stock, a warrant to
purchase ______________ shares of Common Stock at $1.50 per share and a warrant
to purchase ______________ shares of Common Stock at $2.00 per share)
By: ____________________________
__________________________________________________________
(Print Name of Investor as it is to Appear on Certificate)
__________________________________________________________
Address:
________________________________________________________________________________
City State Zip
________________________________________________________________________________
Social Security Number or Taxpayer Identification Number
(____) ______________________________
Facsimile number:
ACCEPTED BY COMPANY:
The X-Change Corporation
BY: __________________________________
Michael L. Sheriff
President & Chief Executive Officer
The X-Change Corporation
710 Century Parkway,
Allen, Texas 75013
Telephone: (972) 747-0051
Fax (972) 359-6334
[Signature Page to Subscription Agreement]
EXHIBIT A
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OFFERING MEMO
EXHIBIT B
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REGISTRATION RIGHTS AGREEMENT
EXHIBIT C
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CONFIDENTIALITY AGREEMENT
EXHIBIT D
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An "accredited investor" is:
(1) A director or executive officer of the Company or its affiliate;
(2) A natural person whose net worth, or joint net worth with the person's
spouse, exceeds $1,000,000 at the time of this purchase;
(3) A natural person who had an individual income (not including his or her
spouse's income) in excess of $200,000 ($300,000 if including the spouse's
income) in 2004 and 2005, and who reasonably expects an income in excess of such
levels in the current year;
(4) A bank defined in Section 3(a) (2) of the Securities Exchange Act of 1933
(the "Act") or any savings and loan association or other institution as defined
in Section 3(a)(5)(A) of the Act whether acting in its individual or fiduciary
capacity; any broker or dealer registered pursuant to Section 15 of the
Securities Exchange Act of 1934; an insurance company as defined in Section
2(13) of the Act; an investment company registered under the Investment Company
Act of 1940 or a business development company, as defined in Section 2(a)(48) of
that Act; a Small Business Investment Company licensed by the U.S. Small
Business Administration under Section 301(c) or (d) of the Small Business
Investment Act of 1958; an employee benefit plan within the meaning of Title I
of the Employee Retirement Income Security Act of 1974, if the investment
decision is made by a plan fiduciary, as defined in Section 3(21) of such Act,
which is either a bank, savings and loan association, insurance company, or
registered investment advisor, or if the employee benefit plan has total assets
in excess of $5,000,000 or, if a self-directed plan, with investment decisions
made solely by persons that are accredited investors;
(5) A private business development company as defined in Section 202(a) (22) of
the Investment Advisors Act of 1940;
(6) An organization described in Section 501(c)(3) of the Internal Revenue
Code, corporation, Massachusetts or similar business trust, or partnership not
formed for the specific purpose of acquiring the Securities offered with total
assets in excess of $5,000,000;
(7) any trust with total assets in excess of $5,000,000 not formed for the
specific purpose of acquiring the Securities offered, whose purchase is directed
by a sophisticated person as described in Rule 506(b)(2)(ii) of Regulation D; or
(8) any entity in which all of the equity owners are accredited investors under
provisions (i), (ii), (iii), (iv), (v), (vi) or (vii) above.