ex10-1.htm


    Mr.
      Ricardo Salas

    64
      Ritz Cove Drive

    Monarch
      Beach, CA 92629

    


    July
      17,
      2007

    Theater
      Xtreme Entertainment Group, Inc.

    250
      Corporate Boulevard, Suites E&F

    Newark,
      DE 19702

    Attention:
      Scott R. Oglum, President

    


    Re:           Purchase
      of $100,000 Promissory Note and Warrants

    


    Dear
      Mr.
      Oglum:

    


    In
      connection with the sale by Theater
      Xtreme Entertainment Group, Inc. (the "Company") to the undersigned today of
      a
      Promissory Note in the face amount of $100,000 and a Warrant to purchase up
      to
      50,000 shares of the common stock, par value $0.001 per share of the Company,
      the undersigned hereby represents and warrants to the Company as
      follows:

    


    (a)           Advice.
      The undersigned has either consulted with the undersigned's own investment
      adviser, attorney and/or accountant about the proposed investment and its
      suitability for the undersigned or chosen not to do so, despite the
      recommendation of that course of action by the Company. The undersigned
      understands the risks of, and other considerations relating to, a purchase
      of
      such Promissory Note and the Warrant (collectively, the "Securities"). The
      undersigned acknowledges that the undersigned has been given access to, and
      prior to the execution of this letter the undersigned was provided with an
      opportunity to ask questions of and receive answers from, the Company concerning
      the terms and conditions of the offering of the Securities, and to obtain any
      other information which the undersigned and the undersigned's professional
      advisors requested with respect to the Company and the undersigned's proposed
      investment in the Company in order to evaluate the investment and verify the
      accuracy of all information furnished to the undersigned regarding the Company.
      All such questions, if asked, were answered satisfactorily and all information
      or documents provided were found to be satisfactory.

    


    (b)           Investment
      Representation and Warranty. The undersigned is acquiring the Securities for
      his, her or its own account as principal not with a view to or for sale in
      connection with any distribution of all or any part of such Securities. The
      undersigned hereby agrees that the undersigned will not, directly or indirectly,
      assign, transfer, offer, sell, pledge, hypothecate or otherwise dispose of
      all
      or any part of such Securities (or solicit any offers to buy, purchase or
      otherwise acquire or take a pledge of all or any part of the Securities) except
      in accordance with the registration provisions of the Securities Act or an
      exemption from such registration provisions, and any applicable state or other
      securities laws.

    


    (c)           Representation
      of Investment Experience and Ability to Bear Risk. The undersigned (i) is
      knowledgeable and experienced with respect to the financial, tax and business
      aspects of the ownership of investments such as the Securities and of the
      business contemplated

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    by
      the
      Company and is capable of evaluating the risks and merits of purchasing
      Securities and, in making a decision to proceed with this investment, has not
      relied upon any representations, warranties or agreements of the Company other
      than as set forth in the documentation executed by the Company in connection
      with the purchase of the Securities, and (ii) can bear the economic risk of
      an
      investment in the Company and can afford to suffer the complete loss
      thereof.

    


    (d)           Accredited
      Investor. The undersigned is an accredited investor within the meaning of
      Rule 501(a) of Regulation D promulgated under the Securities Act by reason
      of
      clause 5 thereof.

    


    (e)           Suitability.
      The undersigned has evaluated the risks involved in investing in the Securities
      and has determined that the Securities are a suitable investment for the
      undersigned. Specifically, the aggregate amount of the investments the
      undersigned has in, and the undersigned's commitments to, all similar
      investments that are illiquid is reasonable in relation to the undersigned's
      net
      worth, both before and after the purchase of the Securities.

    


    (f)           Transfers
      and Transferability. The undersigned understands and acknowledges that the
      Securities have not been registered under the Securities Act or any state
      securities laws and are being offered and sold in reliance upon exemptions
      provided in the Securities Act and state securities laws for transactions not
      involving any public offering and, therefore, cannot be resold or transferred
      unless they are subsequently registered under the Securities Act and such
      applicable state securities laws or unless an exemption from such registration
      is available. The undersigned also understands that the Company does not have
      any obligation or intention to register the Securities for sale under the
      Securities Act or any state securities laws or of supplying the information
      which may be necessary to enable the undersigned to sell the Securities and
      that
      the undersigned has no right to require the registration of the Securities
      under
      the Securities Act, any state securities laws or other applicable securities
      regulations.

    


    The
      undersigned represents and warrants
      further that the undersigned has no contract, understanding, agreement or
      arrangement with any person to sell, transfer or pledge to such person or anyone
      else any of the Securities (in whole or in part) and that the undersigned has
      no
      present plans to enter into any such contract, undertaking, agreement or
      arrangement.

    


    The
      undersigned understands that there
      is no public market for the Securities and that any disposition of the
      Securities may result in unfavorable tax consequences to the
      undersigned.

    


    The
      undersigned is aware and
      acknowledges that, because of the substantial restrictions on the
      transferability of the Securities, it may not be possible for the undersigned
      to
      liquidate the undersigned's investment in the Company readily, even in the
      case
      of an emergency.

    


    (g)           Address.
      If the undersigned is an individual, the undersigned maintains a domicile at
      the
      address shown on the signature page of this letter and the undersigned is not
      merely a transient or temporarily resident there. If the undersigned is an
      entity, the undersigned maintains its principal place of business at the address
      shown on the signature page of this letter.

    


    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    (h)           Power,
      Authority; Valid Agreement. The undersigned has (i) all requisite power and
      authority to execute, deliver and perform the obligations of the undersigned
      under this letter and the obligation to purchase the Securities and to subscribe
      for and purchase or otherwise acquire the Securities, (ii) the undersigned's
      execution of this letter has been authorized by all necessary corporate or
      other
      action on the undersigned's behalf and (iii) this letter is valid, binding
      and
      enforceable against the undersigned in accordance with its terms.

    


    (l)           No
      Conflict; No Violation. The execution and delivery of this letter by the
      undersigned and the performance of the undersigned's duties and obligations
      hereunder (i) do not and will not result in a breach of any of the terms,
      conditions or provisions of or constitute a default under (A) any charter,
      by-laws, trust agreement, partnership agreement or other governing instrument
      applicable to the undersigned or (B)(1) any indenture, mortgage, deed of trust,
      credit agreement, note or other evidence of indebtedness or any lease or other
      agreement or understanding or (2) any license, permit, franchise or certificate,
      in either case to which the undersigned is a party or by which the undersigned
      or any of them is bound or to which the undersigned's or any of their properties
      is subject, (ii) do not require any authorization or approval under or pursuant
      to any of the foregoing and (iii) do not violate any statute, regulation, law,
      order, writ, injunction or decree to which the undersigned is
      subject.

    


    


    Sincerely,

    


    /s/
      Ricardo Salas

    


    Ricardo
      Salas

    64
      Ritz
      Cove Drive

    Monarch
      Beach, CA 92629

     

     

     

     

    3