U.S. SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB

                                   (MARK ONE)
 [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
          ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2005

 [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
    ACT OF 1934 FOR THE TRANSITION PERIOD FROM ------------ TO ------------.

                        COMMISSION FILE NUMBER 002-41703

                            THE X-CHANGE CORPORATION
                     (EXACT NAME OF SMALL BUSINESS ISSUER AS
                            SPECIFIED IN ITS CHARTER)

                     NEVADA                         90-0156146
--------------------------------------------------------------------------------
             (STATE OR OTHER JURISDICTION         (IRS EMPLOYER
         OF INCORPORATION OR ORGANIZATION)      IDENTIFICATION NO.)

                100 ALLENTOWN PARKWAY, SUITE 110, ALLEN, TX 75002
                    (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)

                                 (972) 747-1206
                            ISSUER'S TELEPHONE NUMBER




                      APPLICABLE ONLY TO CORPORATE ISSUERS

         STATE THE NUMBER OF SHARES  OUTSTANDING OF EACH OF THE ISSUER'S CLASSES
OF COMMON EQUITY, AS OF THE LATEST PRACTICAL DATE: SEPTEMBER 30, 2005 25,572,000


         TRANSITIONAL  SMALL BUSINESS  DISCLOSURE FORMAT (CHECK ONE). YES ; NO X











<PAGE>



                                     PART I
ITEM 1.  FINANCIAL STATEMENTS

                            THE X-CHANGE CORPORATION
                          (A Development Stage Company)
                           CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                               (Unaudited)
                                                                              September 30,         December 31,
                                                                                  2005                  2004
                                                                           -------------------  --------------------
ASSETS
Current Assets:
<S>                                                                        <C>                  <C>
     Cash                                                                  $            54,549  $              4,902
     Accounts Receivable                                                               142,158                     -
     Salary Advance                                                                      2,030                     -
     Prepaid Expense                                                                     9,250                     -
                                                                           -------------------  --------------------
Total Current Assets                                                                   207,987                 4,902
                                                                           -------------------  --------------------

Fixed Assets:
     Office Equipment                                                                   28,509                     -
     Less Accumulated Depreciation                                                      (9,751)                    -
                                                                           -------------------  --------------------
Net Fixed Assets                                                                        18,758                     -
                                                                           -------------------  --------------------

Oil & Gas Properties:
     Oil & Gas Properties                                                              295,800                36,878
     Less Depletion                                                                     (5,032)                    -
                                                                           -------------------  --------------------
Net Oil & Gas Properties                                                               290,768                36,878
                                                                           -------------------  --------------------

Intangible Assets:
     Goodwill                                                                          174,587                     -
                                                                           -------------------  --------------------

TOTAL ASSETS                                                               $           692,100  $             41,780
                                                                           ===================  ====================
</TABLE>












                                       F-2

<PAGE>



                            THE X-CHANGE CORPORATION
                          (A Development Stage Company)
                           CONSOLIDATED BALANCE SHEETS
                                   (Continued)

<TABLE>
<CAPTION>

                                                                                (Unaudited)
                                                                                September 30,       December 31,
                                                                                    2005                2004
                                                                             ------------------- -------------------

LIABILITIES
Current Liabilities:
<S>                                                                          <C>                 <C>
     Accounts Payable and Accrued Liabilities                                $           132,723 $            42,292
     Notes Payable                                                                       209,415                   -
     Due to Shareholder                                                                  191,924                   -
                                                                             ------------------- -------------------
Total Current Liabilities                                                                534,062              42,292
                                                                             ------------------- -------------------

TOTAL LIABILITIES                                                                        534,062              42,292
                                                                             ------------------- -------------------

STOCKHOLDERS' EQUITY (DEFICIT)
     Preferred Stock, Par Value $.001,
       Series A Convertible - 5,000,000 Shares Authorized,
       0 Issued at September 30, 2005 and December 31, 2004                                    -                   -
     Common Stock, Par value $.001, Authorized
       100,000,000 Shares, Issued 25,572,000 and 14,752,000
       at September 30, 2005 and December 31, 2004                                        25,572              14,752
     Paid-In Capital                                                                     843,875             653,283
     Retained Deficit                                                                   (536,688)           (536,688)
     Deficit Accumulated During Development Stage                                       (174,721)           (131,859)
                                                                             ------------------- -------------------
TOTAL STOCKHOLDERS' EQUITY (DEFICIT)                                                     158,038                (512)
                                                                             ------------------- -------------------

TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY (DEFICIT)                                                             $           692,100 $            41,780
                                                                             =================== ===================
</TABLE>











                             See accompanying notes

                                       F-3

<PAGE>



                            THE X-CHANGE CORPORATION
                          (A Development Stage Company)
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                                                       Cumulative
                                                                                                                         Since
                                                                                                                       October 4,
                                                                                                                          2000
                                                       For the Three Months Ended     For the Nine Months Ended       Inception of
                                                        September 30,                       September 30,             Development
                                                    2005              2004              2005             2004            Stage
                                             ------------------ ----------------- ---------------- ---------------- ----------------

<S>                                          <C>                <C>               <C>              <C>              <C>
Revenues                                     $          446,761 $               - $        573,717 $              - $        611,156
Costs of Operations                                     123,761                 -          162,237                -          191,429
                                             ------------------ ----------------- ---------------- ---------------- ----------------

   Net Operating Income                                 323,000                 -          411,480                -          419,727

Expenses
   Consulting                                           183,588                 -          194,496                -          194,496
   General & Administrative                             290,541             4,575          334,652            8,759          416,443
                                             ------------------ ----------------- ---------------- ---------------- ----------------

Net Loss from Continuing Operations                    (151,129)           (4,575)        (117,668)          (8,759)       (191,212)
                                             ------------------ ----------------- ---------------- ---------------- ----------------

Other Income (Expense)
   Interest Expense                                     (21,451)                -          (25,384)               -         (25,384)
   Interest Income                                          128                 -              190                -              190
   Sale of Working Interest                                   -                 -          100,000                -          100,000

Discontinued Operations
   Loss on Sale of AirGate                                    -           (67,315)               -          (67,315)        (58,315)
                                             ------------------ ----------------- ---------------- ---------------- ----------------

     Net Income (Loss)                       $         (172,452)$         (71,890)$        (42,862)$        (76,074)$      (174,721)
                                             ================== ================= ================ ================ ================

Earnings per Share, Basic & Diluted          $           (0.01) $               - $              - $          (0.01)
                                             ================== ================= ================ ================

Weighted Average
Shares Outstanding                                   23,256,786        17,102,000       17,730,788       15,379,635
                                             ================== ================= ================ ================
</TABLE>




                             See accompanying notes

                                       F-4

<PAGE>



                            THE X-CHANGE CORPORATION
                          (A Development Stage Company)
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                                            Cumulative
                                                                                                               Since
                                                                                                            October 4,
                                                                                                               2000
                                                                       For the Nine Months Ended           Inception of
                                                                             September 30,                  Development
                                                                 --------------------------------------
                                                                        2005                2004               Stage
                                                                 ------------------  ------------------  -----------------
CASH FLOWS FROM OPERATING ACTIVITIES:
<S>                                                              <C>                 <C>                 <C>
Net Income (Loss)                                                $          (42,862) $          (76,074) $        (174,721)
Adjustments to reconcile net loss to net cash
   Provided by operating activities:
Depreciation and Depletion                                                   14,783                   -             14,783
Stock Issued for Services                                                   131,000               3,000            135,150
Net Loss from Discontinued Operations                                             -              67,315             58,315
Change in Operating Assets and Liabilities:
(Increase) Decrease in Deposits                                                   -                   -                  -
(Increase) Decrease in Employee Advances                                     (2,030)                  -             (2,030)
(Increase) Decrease in Accounts Receivable                                 (142,158)                  -           (142,158)
(Increase) Decrease in Prepaid Expense                                       (9,250)                  -             (9,250)
Increase (Decrease) in Accounts Payable                                      90,431                (926)           161,818
Increase (Decrease) in Accrued Interest                                      27,339                   -             27,339
                                                                 ------------------  ------------------  -----------------

Net Cash Used in Operating Activities                                        67,253              (6,685)            69,246
Net Cash Used in Discontinued Activities                                          -               6,685              6,685
                                                                 ------------------  ------------------  -----------------
Net Cash Used in Operating Activities                                        67,253                   -             75,931
                                                                 ------------------  ------------------  -----------------

CASH FLOWS FROM INVESTING ACTIVITIES:
Oil & Gas Property Interest                                                (258,922)                  -           (295,800)
Purchase of Office Equipment                                                (28,509)                  -            (28,509)
Sale of Office Equipment                                                          -                   -                  -
Purchase of Furniture and Fixtures                                                -                   -                  -
Purchase of Goodwill                                                       (174,587)                  -           (174,587)
                                                                 ------------------  ------------------  -----------------
Net Cash Provided by Investing Activities                                  (462,018)                  -           (498,896)
                                                                 ------------------  ------------------  -----------------

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from Loans                                                         200,000                   -            200,000
Proceeds from Shareholder Loan                                              174,000                   -            174,000
Proceeds from Common Stock Issued                                            10,000                   -             10,000
Capital Contributed                                                          60,412                   -             93,514
                                                                 ------------------  ------------------  -----------------
Net Cash Provided by Financing Activities                                   444,412                   -            477,514
                                                                 ------------------  ------------------  -----------------


Net (Decrease) Increase in Cash                                              49,647                   -             54,549
Cash at Beginning of Period                                                   4,902                   -                  -
                                                                 ------------------  ------------------  -----------------
Cash at End of Period                                            $           54,549  $                -  $          54,549
                                                                 ==================  ==================  =================
</TABLE>


                                       F-5

<PAGE>



                            THE X-CHANGE CORPORATION
                          (A Development Stage Company)
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)
                                   (Continued)

<TABLE>
<CAPTION>
                                                                                                            Cumulative
                                                                                                               Since
                                                                                                            October 4,
                                                                                                               2000
                                                                       For the Nine Months Ended           Inception of
                                                                             September 30,                  Development
                                                                 --------------------------------------
                                                                        2005                2004               Stage
                                                                 ------------------  ------------------  -----------------

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

Cash paid during the year for:
<S>                                                              <C>                 <C>                 <C>
  Interest                                                       $                -  $                -  $               -
  Franchise and Income Taxes                                     $                -  $                -  $               -

SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:


Common stock issued for services provided                        $          131,000  $                -  $               -

</TABLE>




















                             See accompanying notes

                                       F-6

<PAGE>



                            THE X-CHANGE CORPORATION
                          (A Development Stage Company)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

         This summary of  accounting  policies for The X-Change  Corporation  (A
Development Stage Company) is presented to assist in understanding the Company's
financial  statements.  The accounting  policies  conform to generally  accepted
accounting  principles and have been consistently  applied in the preparation of
the financial statements.

Nature of Operations and Going Concern

         The accompanying  financial  statements have been prepared on the basis
of accounting principles applicable to a "going concern",  which assume that the
Company  will  continue in  operation  for at least one year and will be able to
realize  its assets  and  discharge  its  liabilities  in the  normal  course of
operations.

         Several conditions and events cast doubt about the Company's ability to
continue  as  a  "going  concern".  The  Company  has  incurred  net  losses  of
approximately  $711,000  for the  period  from  October  4, 2000  (inception  of
development stage) to September 30, 2005.

         The  Company's  general  business  strategy is to acquire  interests in
emerging  opportunities  that the Company  believes  will  generate  significant
revenues and return a profit to shareholders.

         In the radio frequency  identification  (RFID) and  intelligent  sensor
networks  business  space,  the Company will continue to position  itself in the
industry as a total end-to-end solution enabler. The continued operations of the
Company in this  industry is dependent on the ability of the Company to continue
to obtain  developmental  contracts as well as royalty  agreements  on developed
technologies.

         In the oil and gas industry,  the Company will continue to evaluate its
prospects and opportunities, and if feasible, these properties will be developed
or will be sold at a profit to the  Company.  The  continued  operations  of the
Company and the recoverability of oil and gas property acquisition,  exploration
and   development   costs  is  dependent  upon  the  existence  of  economically
recoverable  reserves  and the  ability of the  Company to obtain  financing  to
complete  the  development  of  those  reserves,   and  upon  future  profitable
production. To date, the Company has not generated significant revenues from the
oil and gas operations and will require  additional funds to meet its obligation
and the costs of its operations. As a result, significant losses are anticipated
prior  to the  generation  of  any  significant  revenues  in the  oil  and  gas
operations.  The Company may plan additional  ongoing equity financing by way of
private placements to fund its obligations and operations.

                                       F-7

<PAGE>



                            THE X-CHANGE CORPORATION
                          (A Development Stage Company)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)

         The Company's future capital  requirements will depend on many factors,
including securing  additional  developmental  contracts and royalty agreements,
costs of  exploration of the  properties,  cash flow from  operations,  costs to
complete  well  production,  if  warranted,  and  competition  and global market
conditions.  The Company's  anticipated  recurring  operating losses and growing
working capital needs may require that it obtain  additional  capital to operate
its business.  Further,  the Company does not have  sufficient  funds on hand to
complete the exploration of the oil and gas properties.

         Should  the  Company  be unable to secure  development  contracts,  the
Company will depend almost  exclusively on outside  capital to complete  current
technology  projects as well as the  exploration  and development of the oil and
gas properties.  Such outside capital will include the sale of additional  stock
and could include commercial  borrowing.  There can be no assurance that capital
will be available as necessary to meet these continuing  technology  development
and/or  exploration and development costs or, if the capital is available,  that
it will be on terms  acceptable  to the Company.  The  issuances  of  additional
equity  securities  by the Company may result in a  significant  dilution in the
equity  interests  of its  current  stockholders.  Obtaining  commercial  loans,
assuming those loans would be available, will increase the Company's liabilities
and future cash commitments. If the Company is unable to obtain financing in the
amounts and on terms deemed  acceptable,  the business and future success may be
adversely affected.

         These  financial  statements do not reflect  adjustments  that would be
necessary  if the Company  were unable to continue as a "going  concern".  While
management believes that the actions already taken or planned, will mitigate the
adverse conditions and events which raise doubt about the validity of the "going
concern" assumption used in preparing these financial  statements,  there can be
no assurance that these actions will be successful.

         If the  Company  were unable to  continue  as a "going  concern",  then
substantial adjustments would be necessary to the carrying values of assets, the
reported  amounts of its  liabilities,  the reported  expenses,  and the balance
sheet classifications used.

Interim Reporting

         The unaudited financial statements as of September 30, 2005 and for the
three and nine month period then ended,  reflect,  in the opinion of management,
all adjustments (which include only normal recurring  adjustments)  necessary to
fairly state the financial position and results of operations


                                       F-8

<PAGE>



                            THE X-CHANGE CORPORATION
                          (A Development Stage Company)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)

for the three and nine  months.  Operating  results for interim  periods are not
necessarily indicative of the results which can be expected for full years.

Organization and Basis of Presentation

         The Company was incorporated under the laws of the State of Delaware on
February  5,  1969  as  Diversified   Technologies   Group,  Inc.,  the  Company
reincorporated  and  changed  its  domicile to the State of Nevada on October 4,
2000. The Company on December 1, 1999, entered into an agreement (Reorganization
Agreement) to acquire all of the  outstanding  capital stock of S&J  (Chatteris)
Holdings Limited, a United Kingdom  corporation (S&J Holdings).  Pursuant to the
Reorganization  Agreement,  the Company agreed to acquire all of the outstanding
capital stock of S&J in exchange for shares of Common Stock. The  Reorganization
Agreement  required S&J Holdings to perform  certain  conditions,  including the
delivery  of  audited  financial  statements.  These  conditions  had  not  been
fulfilled by February 14, 2000;  therefore,  the  agreement  was  rescinded  and
deemed  to  have  been  void  and of no  effect  from  the  beginning  as if the
acquisition had not occurred. All shares issued in the acquisition were returned
to treasury.  The Company also attempted two  acquisitions  in 2000,  neither of
which were able to deliver  the  required  financial  statements.  The first was
rescinded and the second was not consummated.  In June 2001, the Company entered
into a reorganization  agreement that was later rescinded for failure to provide
adequate  compliance with the  representations,  warranties and covenants of the
agreement.  In  July  2001,  the  Company  changed  its  name  to  The  X-Change
Corporation.

         On January 15, 2002,  the Company  merged with WEBiX,  Inc. This merger
resulted in the Company  acquiring  the business  and  operations  of WEBiX,  in
exchange for the issuance by the Company of a controlling interest in its shares
to the former  shareholders of WEBiX.  On March 13, 2003, the Company  rescinded
the agreement with WEBiX and reentered the development stage.

         On February  9, 2004,  the Company  formed a wholly  owned  subsidiary,
AirGATE Technologies,  Inc. Subsequently on September 30, 2004, the Company sold
100% of its ownership in the Company to Michael Sheriff.

         In June 2004,  the  Company  formed a new  subsidiary,  OIL ID Systems,
Inc., which acquired  thirty-eight wells in East Texas. As of December 31, 2004,
OIL ID Systems, Inc. changed its name to Curado Energy Resources, Inc.


                                       F-9

<PAGE>



                            THE X-CHANGE CORPORATION
                          (A Development Stage Company)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)

         On  September  30,  2004,  the Company  entered  into a share  purchase
agreement  with  Kolt Oil & Gas,  a Texas  Corporation,  where it  acquired  the
business,  operations  and prospects of Kolt Oil & Gas for  2,500,000  shares of
common stock. Subsequently, the share purchase agreement with Kolt Oil & Gas was
rescinded and the 2,500,000 shares were canceled. On March 11, 2005, the Company
issued  150,000 shares to acquire the Texas  operator's  license for oil and gas
properties of Kolt Oil & Gas.

         On July 20, 2005, the Company reacquired 100 percent of the outstanding
shares of AirGATE Technologies,  Inc. for 10,000,000 restricted shares of common
stock.  Accordingly,  the results of operations for AirGATE  Technologies,  Inc.
have been included in the accompanying  consolidated  financial  statements from
that date forward.

Nature of Business

         On February  9, 2004,  the Company  formed a wholly  owned  subsidiary,
AirGATE  Technologies,  Inc., for the purpose of engaging in the development and
acquisition   of   leading-edge   wireless   internet/networking   technologies,
principally RFID ("radio frequency  identification").  In June 2004, the Company
formed two wholly owned subsidiaries, Innovative Telecommunication Technologies,
Inc. (ITT) and OIL ID Systems,  Inc. Demand for radio  frequency  identification
solutions by energy producers and oil field service companies led the Company to
create OIL ID Systems as a compliment  to its wholly owned  subsidiary,  AirGATE
Technologies,  Inc.  The level of  demand  for RFID  systems  in the oil and gas
industry  around  the world is on the rise,  and OIL ID Systems  was  created to
assist AirGATE  Technologies in developing  contacts and capturing  market share
within this growing RFID market niche.  As of December 31, 2004,  OIL ID Systems
changed its name to Curado Energy Resources, Inc.

         On September 30, 2004, the Company  decided to discontinue  its efforts
with  the  AirGATE  business  plan and  sold  AirGATE  to  Michael  L.  Sheriff.
Subsequently, the Company reacquired AirGATE Technologies, Inc.

         In  connection  with a share  purchase  agreement  with Kolt Oil & Gas,
because of continued  rising oil and gas demand and prices,  the Company decided
to  investigate  opportunities  in the  oil  and  gas  industry.  The  Company's
objective  regarding  the oil and gas  industry  is to  identify,  acquire,  and
develop  working  interest  percentages in smaller,  underdeveloped  oil and gas
projects  that  do not  meet  the  requirements  of  the  larger  producers  and
developers.  The Company's  primary objective is now in the RFID industry and is
to position the Company as a total end-to-end solution provider.


                                      F-10

<PAGE>



                            THE X-CHANGE CORPORATION
                          (A Development Stage Company)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)

Principals of Consolidation

         The  consolidated  financial  statements  include the  accounts for The
X-Change  Corporation and its wholly owned  subsidiaries  AirGATE  Technologies,
Inc. and Curado  Energy  Resources,  Inc.  (Formerly  OIL ID Systems,  Inc.) The
results of  subsidiaries  acquired during the year are  consolidated  from their
effective  dates of  acquisition.  All  significant  intercompany  accounts  and
transactions have been eliminated.

Cash and Cash Equivalents

         For the purpose of  reporting  cash flows,  the Company  considers  all
highly liquid debt  instruments  purchased with maturity of three months or less
to be cash equivalents to the extent the funds are not being held for investment
purposes.

Oil and Gas Properties

         The Company  follows the full cost method of accounting for its oil and
gas properties. Accordingly, all costs related to the acquisition,  exploration,
development  of oil and gas  reserves,  including  related  overhead  costs  and
related asset retirement  costs,  are  capitalized.  Such costs include land and
lease acquisition  costs,  annual carrying charges of non-producing  properties,
geological and geophysical costs, costs of drilling and equipping productive and
non-productive  wells,  and direct  exploration  salaries and related  benefits.
Proceeds from the disposal of oil and gas properties are recorded as a reduction
of the related  capitalized  costs without  recognition of a gain or loss unless
the  disposal  would  result in a change of 20 percent or more in the  depletion
rate. The Company operates in one cost center, being the United States.

         Depletion and depreciation of the capitalized  costs are computed using
the unit-of-production  method based on the estimated proven reserves of oil and
gas determined by independent consultants.

         Estimated future removal and site  restoration  costs are provided over
the life of proven reserves on a unit-of-production  basis. Costs, which include
the  cost of  production  equipment  removal  and  environmental  clean-up,  are
estimated  each  period  by  management  based on  current  regulations,  costs,
technology and industry  standards.  The charge is included in the provision for
depletion and depreciation and the actual  restoration  expenditures are charged
to the accumulated provision amounts as incurred.

         Total  depletion  expense for the nine months ended  September 30, 2005
and 2004 was $5,032 and $0, respectively.

                                      F-11

<PAGE>



                            THE X-CHANGE CORPORATION
                          (A Development Stage Company)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)

         The Company applies a ceiling test to capitalized  costs to ensure that
such costs do not exceed estimated future net revenues from production of proven
reserves  at year end market  prices  less  future  production,  administrative,
financing,  site  restoration,  and  income  tax costs plus the lower of cost or
estimated  market  value  of  unproved  properties.  If  capitalized  costs  are
determined to exceed  estimated  future net  revenues,  a write-down of carrying
value is charged to depletion in the period.

Concentrations of Credit Risk

         The  Company has no  significant  off-balance-sheet  concentrations  of
credit  risk such as foreign  exchange  contracts,  options  contracts  or other
foreign hedging arrangements.

Revenue Recognition

         Revenue and related  costs are reflected in the accounts when earned or
incurred.

Depreciation and Amortization

         Fixed assets are recorded at cost and  depreciated  using straight line
and  accelerated  methods  over the  estimated  useful lives of the assets which
range from three to five years.  Fixed  assets  consisted  of the  following  at
September 30, 2005 and December 31, 2004:

<TABLE>
<CAPTION>

                                                    September 30,               December 31,
                                                         2005
                                                         2005                       2004
                                                ----------------------     ----------------------
<S>                                             <C>                        <C>
Office Equipment                                $               28,509     $                    -
Less Accumulated Depreciation                                   (9,751)                         -
                                                ----------------------     ----------------------

Total                                           $               18,758     $                    -
                                                ======================     ======================
</TABLE>


         Maintenance  and  repairs are charged to  operations;  betterments  are
capitalized.  The  cost  of  property  sold  or  otherwise  disposed  of and the
accumulated  depreciation  there on are eliminate  from the property and related
accumulated depreciation accounts, and any resulting gain or loss is credited or
charged to income.


                                      F-12

<PAGE>



                            THE X-CHANGE CORPORATION
                          (A Development Stage Company)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)


         Total  depreciation  expense for the nine months  needed  September 31,
2005 and 2004 was $5,174 and $0.

         The Company has adopted the Financial  Accounting  Standards Board SFAS
No., 142, "Goodwill and Other Intangible Assets." SFAS 142 requires, among other
things,  that companies no longer amortize  goodwill,  but instead test goodwill
for  impairment  at least  annually.  In addition,  SFAS 142  requires  that the
Company identify reporting units for the purposes of assessing potential

future  impairments  of goodwill,  reassess  the useful lives of other  existing
recognized  intangible  assets, and cease amortization of intangible assets with
an indefinite  useful life. An intangible  asset with an indefinite  useful life
should be tested for impairment in accordance with the guidance in SFAS 142.

Pervasiveness of Estimates

         The  preparation of financial  statements in conformity  with generally
accepted  accounting  principles  required  management  to  make  estimates  and
assumptions  that  affect the  reported  amounts of assets and  liabilities  and
disclosure of  contingent  assets and  liabilities  at the date of the financial
statements  and the  reported  amounts  of  revenues  and  expenses  during  the
reporting period. Actual results could differ from those estimates.

Stock Compensation for Non-Employees

         The  Company  accounts  for the fair  value of its  stock  compensation
grants for  non-employees  in accordance with FASB Statement 123. The fair value
of each grant is equal to the market price of the Company's stock on the date of
grant if an active  market  exists or at a value  determined  in an arms  length
negotiation between the Company and the non-employee.

Income Taxes

         The  Company  follows the  liability  method of  accounting  for income
taxes.  Under this method,  future tax assets and liabilities are recognized for
the future tax  consequences  attributable to differences  between the financial
statement  carrying  amounts  of  existing  assets  and  liabilities  and  their
respective tax balances.  Future tax assets and  liabilities  are measured using
enacted or

                                      F-13

<PAGE>



                            THE X-CHANGE CORPORATION
                          (A Development Stage Company)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)

substantially  enacted tax rates  expected to apply to the taxable income in the
years in which those  differences  are expected to be recovered or settled.  The
effect  on  future  tax  assets  and  liabilities  of a change  in tax  rates is
recognized  in income in the  period  that  includes  the date of  enactment  or
substantive  enactment.  As of December 31, 2004,  the Company had net operating
loss carryforwards;  however,  due to the uncertainty of realization the Company
has provided a full  valuation  allowance for the deferred tax assets  resulting
from these loss carryforwards.

Earnings (Loss) per Share

         Basic  earnings  (loss) per share has been  computed  by  dividing  the
income (loss) for the year applicable to the common stockholders by the weighted
average  number of common shares  outstanding  during the years.  The effects of
common stock equivalents are anti-dilutive and thus are not considered.

NOTE 2 - INCOME TAXES

         As  of  December  31,  2004,  the  Company  had a  net  operating  loss
carryforward for income tax reporting  purposes of  approximately  $669,000 that
may be offset against  future  taxable income through 2024.  Future tax benefits
which may arise as a result of these  losses and  resource  deductions  have not
been  recognized  in  these  financial  statements,   as  their  realization  is
determined not likely to occur.

NOTE 3 - DEVELOPMENT STAGE COMPANY/ GOING CONCERN

         As  common  with a  development  stage  company,  the  Company  has had
recurring losses during the development stage.  Continuation of the Company as a
going  concern is  dependent  upon  obtaining  the  additional  working  capital
necessary to be successful in its planned  activity,  and the  management of the
Company  has  developed  strategies,  which they  believe  will  accomplish  the
objectives through  development  contracts and through additional equity funding
and long term financing if necessary.

NOTE 4 - COMMITMENTS

         Through  March  31,  2005,  all  activities  of the  Company  had  been
conducted by corporate officers from either their homes or business offices.  In
April  2005,   the  Company   entered  into  a  lease   agreement  with  AirGATE
Technologies,  Inc. to share office space on a month-to-month basis.  Currently,
there  are no  outstanding  debts  owed by the  company  for  the  use of  these
facilities.

                                      F-14

<PAGE>



                            THE X-CHANGE CORPORATION
                          (A Development Stage Company)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

NOTE 4 - COMMITMENTS (Continued)

         Subsequent  to September  30,  2005,  the Company  will  re-locate  its
corporate  headquarters to the Bethany Tech Center, in Allen, Texas. The Company
will lease  11,400  square feet of office  space from  November 1, 2005  through
December 31, 2010.  The lease payments are $7,830 per month over the duration of
the lease.

NOTE 5 - LINE OF CREDIT / NOTE PAYABLE - SHAREHOLDER

         During  January,  2005,  a  shareholder  extended  to  the  Company  an
unsecured line of credit for up to $500,000. The credit line carries interest at
the existing  prime rate.  As of September  30, 2005,  the Company owed $25,702,
against this line of credit and is reported  along with accrued  interest in the
accompanying financial statements as Due to Shareholder.

         On September 30, 2004,  the Company  received a loan from a shareholder
of $149,000.  This note carries an interest rate of 11 percent per annum.  As of
September 30, 2005,  the total amount of principal and interest due on this note
is $166,222.

NOTE 6 - NOTE PAYABLE

         As of  September  30,  2005,  the  Company  had a  short  term  loan of
$200,000, with interest at 8 percent. As of September 30, 2005, accrued interest
on this loan was $9,415.

NOTE 7 - PREFERRED STOCK

         The Company has  authorized a total of  10,000,000  shares of Preferred
Stock.  Series A Convertible  Preferred Stock is the initial series of Preferred
Stock. This series shall consist of 5,000,000 shares with a par value of $.001.

         The  Corporation  is under no  obligation to pay dividends or to redeem
the Series A Convertible  Preferred  Stock.  This series of stock is convertible
into 10  shares  of  Common  Stock  at the  option  of the  shareholder  or upon
automatic conversion.

         In the  event of any  liquidation,  dissolution  or  winding-up  of the
Corporation,  the holders of outstanding  shares of Series A Preferred  shall be
entitled  to be  paid  out  of  the  assets  of the  Corporation  available  for
distribution to  shareholders,  before any payment shall be made to or set aside
for holders of the Common Stock, at an amount of $1 per share.

         As of September 30, 2005, there are no preferred shares issued.

                                      F-15

<PAGE>



                            THE X-CHANGE CORPORATION
                          (A Development Stage Company)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

NOTE 8 - COMMON STOCK TRANSACTIONS

         On April 2, 2004, the Company issued 100,000 shares of common stock for
consulting services. The shares were valued at $0.53 per share.

         On April  26,  2004,  the  Company's  president  surrendered  his stock
options  contract for  12,000,000  common shares in exchange for the issuance of
4,000,000  shares of restricted  common stock.  The shares are  restricted for 2
years.  In  connection  with  issuance  of the shares,  $15,000 was  recorded as
consulting expense.

         On September 30, 2004,  the Company sold 100% of its AirGATE,  a wholly
owned  subsidiary,  shares in  exchange  for return of  3,500,000  of its common
shares. These shares were returned to treasury and subsequently canceled.

         On  September  30,  2004,  the Company  entered  into a share  purchase
agreement  with  Kolt Oil & Gas,  a Texas  Corporation,  where it  acquired  the
business,  operations  and prospects of Kolt Oil & Gas for  2,500,000  shares of
common stock. Subsequently, the share purchase agreement with Kolt Oil & Gas was
rescinded and the 2,500,000 shares were canceled. On March 11, 2005, the Company
issued  150,000 shares to acquire the Texas  operator's  license for oil and gas
properties of Kolt Oil & Gas.

         On November 23, 2004,  the Company  issued  1,000,000  shares of common
stock for consulting services. The shares were valued at $0.001 per share.

         As of March 31, 2005,  the Company  issued 100,000 shares of restricted
common stock to an outside investor for $1.

         As of March 31, 2005,  the Company  issued  70,000 shares of restricted
common stock for consulting services. In connection with issuance of the shares,
$1,000 was recorded as consulting expense.

         On July 20, 2005, the Company reacquired AirGATE Technologies, Inc. for
10,000,000 restricted shares of common stock. After the AirGATE acquisition, the
Company  issued  650,000  shares of restricted  common stock to  consultants  of
AirGATE Technologies,  Inc. In connection with issuance of the shares,  $130,000
was recorded as a one time consulting expense.





                                      F-16

<PAGE>



                            THE X-CHANGE CORPORATION
                          (A Development Stage Company)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

NOTE 9 - OIL AND GAS ACTIVITIES

         As of September 30, 2005, the Company has two wholly-owned subsidiaries
in oil and gas arena,  Curado Energy  Resources,  Inc.,  which owned 55 wells in
East Texas and which was formerly  known as OIL ID systems,  and Kolt Oil & Gas,
Inc., which is licensed to operate oil and gas properties in Texas.

         All of  Curado's  oil and gas  assets  are  located  in the East  Texas
Woodbine  Field,  which  covers five  counties in East Texas,  those being Rusk,
Gregg,  Smith,  Upshur and  Cherokee.  This  field is over 70 years old,  having
produced over six billion barrels of oil, with estimated reserves of one billion
barrels remaining.

         For the three and nine months ended September 30, 2005, the Company had
net revenues of $45,778 and $172,734,  respectively, from its proven reserves in
the East Texas property.

         As of September 30, 2005,  $295,800 has been  capitalized in connection
with the exploration of unproven properties.

NOTE 10 - MERGER/ACQUISITION

         On January 15,  2002,  the Company and its newly  created  wholly owned
subsidiary  X-Change  Technologies  Corp,  merged  with  WEBiX,  Inc. (a Florida
Corporation).  As a result,  the Company acquired the business and operations of
WEBiX,  in exchange for the issuance of a  controlling  interest in The X-Change
Corporations'  shares to the  former  shareholders  of WEBiX.  Under the Plan of
Merger,  24,000,000  shares  of  Common  Stock,  4,000,000  shares  of  Series A
Convertible Preferred Stock (convertible into 40,000,000 shares of Common Stock)
and 40,000,000 warrants were issued. In addition,  certain existing shareholders
of the Company  surrendered  approximately  9,500,000  shares of Common Stock to
treasury.  In  connection  with  this  merger,  the par  value  of the  Series A
Convertible Preferred Stock changed from $.01 to $.001.

         On March 13, 2003,  the Company  rescinded its agreement  with X-Change
Technologies.  The  rescission,  essentially,  resulted  in  the  return  of all
X-Change  Corporation's  assets in exchange for the surrender of all  securities
held by the former  X-Change  Technologies  shareholders  in the Company and the
assumption by X-Change  Technologies Corp. of all the Company's debt immediately
prior to closing. The rescission effected a change in control over the business,
policies  and affairs of the Company  from the  X-Change  shareholders  to those
shareholders  holding  securities in the Company prior to January 15, 2002. As a
result,  15,062,000  shares of common  stock and  5,000,000  shares of preferred
stock were  returned to treasury  and the Company now has  22,540,000  shares of
common stock, which was the amount  outstanding  immediately prior to closing of
the X-

                                      F-17

<PAGE>



                            THE X-CHANGE CORPORATION
                          (A Development Stage Company)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

NOTE 10 - MERGER/ACQUISITION (Continued)

Change  Technologies  Corp.   acquisition  on  January  15,  2002.  All  lock-up
agreements pertaining to these shares were released effective with the closing.

         On  September  30,  2004,  the Company  entered  into a share  purchase
agreement  with  Kolt Oil & Gas,  a Texas  Corporation,  where it  acquired  the
business,  operations  and prospects of Kolt Oil & Gas for  2,500,000  shares of
common stock. Subsequently, the share purchase agreement with Kolt Oil & Gas was
rescinded and the 2,500,000 shares were canceled. On March 11, 2005, the Company
issued  150,000 shares to acquire the Texas  operator's  license for oil and gas
properties of Kolt Oil & Gas.

         On July 20, 2005, the Company reacquired AirGATE Technologies, Inc. for
10,000,000 restricted shares of common stock.

NOTE 11 - SALE OF WORKING INTEREST

         On June 6, 2005,  the Company  gave Flag  Energy  Resources,  Inc.  the
exclusive  rights to market a portion of the Company's  properties in East Texas
for a period of 90 days upon depositing $100,000.

NOTE 12 - SUBSEQUENT EVENTS

         On  November  1, 2005,  the  Company  closed a sale for the oil and gas
wells in East Texas for $500,000 in cash.  The sale  resulted in an  approximate
gain of  $209,232  for the  Company.  The  proceeds  will be  utilized to reduce
outstanding  accounts  payable  and  debt as well  as  fund  AirGATE's  numerous
development opportunities.












                                      F-18

<PAGE>



ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

This discussion should be read in conjunction with  Management's  Discussion and
Analysis of  Financial  Condition  and Results of  Operations  in the  Company's
annual report on Form 10-KSB for the year ended December 31, 2004.

PLAN OF OPERATION

The Company's primary focus is to develop recurring revenue  opportunities  that
the Company believes will generate  significant  revenues and return a profit to
shareholders.  The Company intends to utilize its oil and gas contacts to market
the  AirGATE  developed  technology  to the oil and gas  industry.  AirGATE  has
completed  Phase I of the three phases of an agreement with a major oil services
company  utilizing  proprietary  AirGATE  technology  in a major  segment of oil
exploration.   A  successful   completion  of  the  project  could   potentially
revolutionize  this $4 billion dollar  portion of the oil industry.  AirGATE has
filed a patent with the customer on the  technology.  In  addition,  AirGATE has
conducted pilots in several other industries,  including automotive,  aerospace,
and  medical  industries.   AirGATE  has  also  developed  proprietary  wireless
technology  for child safety  seats,  prison inmate  identification  and product
authentication.  AirGATE  has  multiple  patents  pending on their  intellectual
property.

The  Company's  business  model  consists of several key  differentiators  that,
management  feels, will set it apart. The Company's focus is to create long-term
shareholder value by:

o        Pursuing intelligent, opportunistic acquisitions of advanced technology
         plays  and  companies   whose   business   plans  and   operations  are
         complementary to the Company's future growth;

o        Consolidating  redundant  functions,  such as  operations,  billing and
         accounting and customer support;

o        Developing  proprietary,  patentable technology that can be licensed to
         create recurring revenue;

o        Partnering  with other  companies  that can  provide  leverage  for the
         Company's activities;

o        Joining industry  organizations  to highlight the Company's  technology
         solutions.

Currently  the  Company  has  two  wholly-owned   subsidiaries,   Curado  Energy
Resources, Inc., which owned 55 wells in East Texas as of September 30, 2005 and
which was formerly known as OIL ID systems, and AirGATE Technologies, Inc.

Curado's oil and gas assets are located in the East Texas Woodbine Field,  which
covers five counties in East Texas, those being Rusk, Gregg,  Smith,  Upshur and
Cherokee.  This field is over 70 years old,  having  produced  over six  billion
barrels of oil, with estimated reserves of one billion barrels

                                      F-19

<PAGE>



remaining.

Through  AirGATE  Technologies,  Inc. the Company's  objective is to develop and
acquire  a  defensible  intellectual  property  and  product  base,  in order to
generate recurring revenue. AirGATE Technologies, Inc. is an early stage company
specializing in radio frequency  identification (RFID),  wireless technology and
intelligent, sensor networks.

It is expected that these  markets will exceed $6 billion  dollars by 2007. As a
full solution company, AirGATE Technologies handles business assessment, process
and technology blending, solution architecture,  technology selection, including
proprietary  AirGATE  technology,  and solution  integration  and  support.  The
Company has, in an environment of technology cost compression, built a stable of
technology partners that are best in class and span a wide range of solutions to
support small, medium and large enterprises.

In April 2005,  the Company was  contacted by agents of the Royal  Government of
Cambodia  regarding  onshore and offshore  oil and gas research and  exploration
rights in  Cambodia.  Representatives  of the  company  traveled  to Cambodia to
evaluate the opportunity, and plans were made to open a Cambodian office pending
approvals. The Company continues to evaluate this opportunity.

Based upon the  opportunities  presented  to the Company in  Cambodia,  X-Change
Corporation  has  facilitated a Memorandum of  Understanding  ("MOU") between KD
Power  Group Co.,  Ltd. of the Kingdom of Cambodia  and Boca  Shipping  Ltd.,  a
Bahamian  company for a coal mining  exploration and production  project for the
Ang Long Veng District in Cambodia.  For its part, the X-Change Corporation will
receive a 5% share of the interests of Boca Shipping Ltd. Pending the outcome of
this venture,  the Company will evaluate its importance  and strategic  value to
the Company.

MANAGEMENT

CHARLES STIDHAM

Mr. Stidham  resigned as Chief Executive  Officer and Chairman on July 20, 2005.

MICHAEL SHERIFF

Mr.  Sheriff  joined the Company  immediately  after the  acquisition of AirGATE
Technologies as Chariman and Chief Executive Officer.

Michael  Sheriff,  president and chief executive  officer,  has over thirty-five
years of experience in the computer and telecommunications industry. In 1998 Mr.
Sheriff  founded Net Access  Exchange,  Inc., dba YPAY.  YPAY was a new Internet
media  network that  provided  advertisers  with a unique and  compelling  value
proposition to reach  consumers via the Internet  through use of  broadband-like
rich  media over  dial-up  connections  - the first  broadband  over  narrowband
advertising and entertainment  network,  providing TV-like  advertising  without
compromising or interfering with the user's Internet

                                      F-20

<PAGE>



connection.  YPAY  utilized a patented  message  delivery  system to harness the
power of the Internet with  multi-media and  market-targeting  capabilities  not
available  in any  other  advertising  medium.

In 1995, Mr. Sheriff founded CyberQuest -- a full-service  Internet  development
company -- focusing its efforts on Internet commerce in the business-to-business
marketplaces.  Under Mr. Sheriff's leadership, the company's Internet e-commerce
flagship,  bid4it,  was developed  utilizing a revolutionary new, patent pending
"bid-and-ask"  matching technology.  The site was launched in 1997 as one of the
first commodity  trading Internet  applications.  Mr. Sheriff sold CyberQuest in
October  1998 to a NASD  OTC:BB  listed  company.  He then  served as CEO of the
public  company,  CBQ, Inc., as well as being Chairman of the company's Board of
Directors.

In 1994,  Mr.  Sheriff  founded and developed Good Stuff Cheap (GSC), a first to
market Internet- based retail site. The company was the first to use intelligent
shopping  agents and was featured in Wired  Magazine in December  1994,  GSC was
also featured on the Discovery Channel in December 1996.

Mr.  Sheriff  is  also  the  former  founder,  President  and  CEO of  ActionFax
International,  Inc. Action Fax operates one of the largest public  fax/Internet
kiosk networks in the world with locations in most world airports.

Prior to ActionFax,  Mr Sheriff was the founder and President of First  National
Computer  Corporation,  which pioneered the rental of personal computers.  Under
his direction, First National Computer became one of the largest PC rental firms
in the  United  States.  Mr.  Sheriff  has  held  senior  sales,  marketing  and
management positions with National Semiconductor,  Northern Telecom, SYCOR, Inc.
and SINGER.

DEAN ELLIOTT

Mr.  Elliott  served as the interim  President for the Company during the second
quarter until his resignation on July 20, 2005.

ROBERT BARBEE

Mr. Barbee holds a Business  Degree from Kilgore  College,  which he obtained in
1992.  He has been  actively  involved in the oil and gas business in East Texas
since 1989. Mr. Barbee has been Vice- President of Oil Patch Pipe & Supply since
2000. This entity is an independent  oil field supply store,  which has garnered
the  distributorship  for  micro  chemical  applications  to down hole well bore
repair.  Mr.  Barbee acted as President of S&B  Resources  from 1991 until 2002,
when he directed the sale of all its assets. S&B was a small, privately-held oil
and gas company which owned and operated its own  production.  From 1992 through
1994 he  directed  LAZ  Financial,  a Russian  company  involved  in oil and gas
natural  resource.  From 1995 through 1998 Mr. Barbee was Operations  Management
for 4-S Operating,  one of the top ten operators in East Texas, where he oversaw
the production of approximately  15,000 barrels of oil monthly.  Mr. Barbee also
worked with Gregg  Industrial  Insulators,  Inc.,  where he  increased  sales by
approximately $5,000,000 annually. Mr.

                                      F-21

<PAGE>



Barbee also serves on the Board of Directors for Merritt Tool in Kilgore, Texas.
This company is a privately owned machine tool shop,  which focuses  principally
on the aviation and oil and gas industries.

SCOTT R. THOMPSON

Mr.  Thompson joined the Company in the final quarter of 2004. He graduated from
the University of Denver, Colorado, in 1985 with a Bachelor of Science Degree in
Accounting,  receiving his CPA in 1986 while working for Ernst & Whinney, a "Big
8" accounting  firm. His clients at Ernst & Whinney included  multinational  and
oil and gas clients.  Mr.  Thompson has focused during the past 12 years on real
estate  sales and  development  and since 2000 has been a part owner and manager
for a capital  management  company.  He holds Series 7, 55, 63 and 65 securities
licenses.

MICHAEL P. MCINERNEY

Mr.  McInerney  joined the  Company  on  October  21,  2004 as a  consultant  to
coordinate  corporate  development.  He brings over 30 years  experience  to the
Company.  His past  experience  includes  executive  positions with two New York
Stock Exchange  listed  companies,  the oversight of corporate  development  and
investor relations with these companies and serving on the board of directors of
Canadian and European  subsidiaries of U.S. based international energy concerns.
Mr.  McInerney  has conducted  meetings,  developed  presentation  materials and
coordinated field trips to the Far East, U.S., Canada,  Europe and South America
for  institutional  investors  and has  been  successful  in  arranging  private
investor financing.

Mr.  McInerney  holds a  Bachelors  of  Business  Arts in  Accounting  from  the
University  of Michigan and is a member of the  American  Institute of Certified
Public  Accountants.  His  credentials  include past  President of the Petroleum
Investor Relations Association and of the Institute of Management Accountants.

CURADO ENERGY RESOURCES, INC.

In June 2004, the Company formed a new subsidiary, Curado Energy Resources, Inc.
(formerly OIL ID Systems, Inc.). Curado Energy Resources, Inc. is an independent
oil & gas exploration and production company with headquarters in Dallas, Texas.
The  principals  involved  in the  company  have 25 years of  experience  in the
marketing of and exploration for petroleum products and services.

AIRGATE TECHNOLOGIES, INC.

AirGATE  Technologies,  Inc. is an early  stage  company  specializing  in radio
frequency  identification  (RFID),  wireless technology and intelligent,  sensor
networks.  It is expected that these  markets will exceed $6 billion  dollars by
2007. As a full solution company,  AirGATE handles business assessment,  process
and technology blending, solution architecture,  technology selection, including
proprietary AirGATE technology,  integration and support. The Company has, in an
environment  of  technology  cost  compression,  built a  stable  of  technology
partners  that are best in class and span a wide range of  solutions  to support
small, medium and large enterprises.

                                      F-22

<PAGE>



AirGATE  is  positioned  in the RFID  industry  as a total  end-to-end  solution
enabler.  As a result of its  exposure and work with large  clients,  AirGATE is
recognized  in  the  industry  with  go-to  name  recognition.  It is  AirGATE's
objective to develop or acquire a defensible  intellectual  property and product
base that creates  recurring  revenue.  Melding  superior  technical skills with
outside-the-box thinking and state-of-the-art technologies, the Company provides
its  customers  with  innovative  technology   solutions.   AirGATE  builds  its
portfolios  of  products  and  services  around a simple  concept;  provide  the
customer  with  truly  exceptional  value  and  the  Company  is  assured  of an
exceptional  return.  AirGATE provides its customers with solutions  tailored to
their  specific  needs;  products  and  services  of  unsurpassed   convenience,
performance and reliability that are an uncommon value.

AirGATE has focused its efforts in vertical  markets  that offer broad  leverage
with these characteristics -- harsh environment, long read range required, metal
and liquid  proximity-which  are  difficult or  impossible  with  standard  RFID
solutions.  AirGATE's  technology  solutions  involve  three  key  technologies:
wireless, including high frequency (13.56 MHz.), ultra-high frequency (900 - 928
MHz.),  Zigbee  (802.15.4) and ultra wideband (UWB.),  and surface acoustic wave
(SAW).  AirGATE has focused  its  expertise  on  closed-loop  RFID and  wireless
applications  in  vertical  markets.   Because   closed-loop   applications  are
intrinsically  results  oriented  and are not  dependent  on factors  outside of
AirGATE's  control,  the time to market and revenue  for  AirGATE is  ultimately
shorter and more controllable.

RESULTS OF OPERATIONS

The Company had $290,541and  $4,575 in general and  administrative  expenses for
the  three  month  ended  September  30,  2005 and 2004,  respectively.  For the
quarters  ended  September 30, 2005 and 2004, the Company had $446,761 and $0 in
revenues, respectively.

LIQUIDITY AND CAPITAL RESOURCES

At September  30,  2005,  the Company had total  current  assets of $207,987 and
total assets of $692,100 as compared to $4,902  current assets and $41,780 total
assets at December 31, 2004. The Company had a net working capital  (deficit) of
($326,075) at September 30, 2005 and ($37,390) at December 31, 2004.

Net  stockholders'  equity  (deficit)  in the  Company  was and  $158,038  as of
September  30, 2005 and ($512) at December  31, 2004.

The Company continues to seek strategic alternatives, including discussions with
joint venture partners and investors.  During January 2004, the Company signed a
revolving line of credit promissory note for $500,000 with certain shareholders.
The accompanying  quarterly financial statements have been prepared assuming the
Company will continue as a going concern. The Company's ability to continue as a
going concern, however, is dependent upon the Company's ability to implement its
business objectives in order to generate cash flow.

                                      F-23

<PAGE>



ITEM 3.  CONTROLS AND PROCEDURES
         The Company's Chief Executive  Officer and Chief Financial  Officer are
responsible for establishing and maintaining  disclosure controls and procedures
for the Company.

         (a) Evaluation of Disclosure Controls and Procedures

         As of the end of the period covered by this report, the Company carried
out an  evaluation,  under the  supervision  and with the  participation  of the
Company's management, including the Company's President, of the effectiveness of
the design and operation of the  Company's  disclosure  controls and  procedures
pursuant to Rule 13a-15 under the  Securities  Exchange Act of 1934,  as amended
(the  "Exchange  Act").  Based  upon the  evaluation,  the  Company's  President
concluded that, as of the end of the period, the Company's  disclosure  controls
and  procedures  were effective in timely  alerting him to material  information
relating to the Company  required to be included in the reports that the Company
files and submits pursuant to the Exchange Act.

         (b) Changes in Internal Controls

         Based on this  evaluation  as of  September  30,  2005,  there  were no
significant  changes in the Company's internal controls over financial reporting
or in any other areas that could  significantly  affect the  Company's  internal
controls  subsequent  to the date of his most recent  evaluation,  including any
corrective  actions  with  regard  to  significant   deficiencies  and  material
weaknesses.

PART II - OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

None

ITEM 2.  CHANGES IN SECURITIES

         On July 20, 2005, the Company reacquired AirGATE Technologies, Inc. for
10,000,000 restricted shares of common stock. After the AirGATE acquisition, the
Company  issued  650,000  shares of restricted  common stock to  consultants  of
AirGATE Technologies,  Inc. In connection with issuance of the shares,  $130,000
was recorded as consulting expense.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

None

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None

ITEM 5.  OTHER INFORMATION

                                      F-24

<PAGE>



         On July 20, 2005, the Company reacquired AirGATE Technologies, Inc. for
10,000,000   restricted   shares  of  common  stock.  In  conjunction  with  the
acquisition,  Mr.  Charles  Stidham  resigned  as Chief  Executive  Officer  and
Chairman  and Mr.  Michael  Sheriff  joined the  Company as  Chariman  and Chief
Executive Officer.

ITEM 6.            EXHIBITS AND REPORTS ON FORM 8-K

Exhibit No.                                 Exhibit Name


2.1      Plan of Merger,  incorporated  by reference to Exhibit 10.1 to Form 8-K
         dated January 30, 2002 - Previously Filed.
3.1      Articles of Incorporation - Previously Filed.
3.2      Certificate  of Amendment to Articles of  Incorporation  of  Registrant
         filed with the Secretary of State of the State of Nevada on January 14,
         2002 - Previously Filed.
3.3      By-Laws - Previously Filed.
4.1      Specimen of Common Stock Certificate - Previously Filed.
4.3      Form of Warrant Agreement,  previously filed, incorporated by reference
         to Exhibit 10.2 to Form 8-K dated January 30, 2002 - Previously Filed.
10.1     License  Agreement  dated as of June 20, 2001 between  WebIAm,  Inc. as
         licensor, and WEBiX Inc. (the predecessor of the Company), as licensee-
         Previously Filed.
10.2     Amendment  to  License  Agreement  dated  as  of  January  15,  2002  -
         Previously Filed.
10.3     Form of Lock-Up Agreement,  incorporated by reference to Exhibit 4.1 to
         Form 8-K dated January 30, 2002 - Previously Filed.
10.4     Securities Repurchase Agreement - Previously Filed.
21       List of subsidiaries - None
31.1*    Certification  of  Principal  Executive  Officer  Pursuant  to 18 U.S.C
         Section 1350 as Adopted  Pursuant to Section 302 of the  Sarbanes-Oxley
         Act of 2002.
31.2*    Certification  of  Principal  Financial  Officer  Pursuant  to 18 U.S.C
         Section 1350 as Adopted  Pursuant to Section 906 of the  Sarbanes-Oxley
         Act of 2002.
32.1*    Certification  of  Principal  Executive  Officer  Pursuant  to 18 U.S.C
         Section 1350 as Adopted  Pursuant to Section 302 of the  Sarbanes-Oxley
         Act of 2002.
32.2*    Certification  of  Principal  Financial  Officer  Pursuant  to 18 U.S.C
         Section 1350 as Adopted  Pursuant to Section 906 of the  Sarbanes-Oxley
         Act of 2002.

* Filed herewith.

Reports on Form 8-K filed in the third quarter of 2005:

         On July 20, 2005, The X-Change Corporation acquired all the outstanding
shares of AirGATE  Technologies,  Inc., pursuant to the Stock Purchase Agreement
between Michael L. Sheriff and the Company.  This transaction of detailed in the
8K filing dated July 27, 2005 and filed July 28, 2005.

                                      F-25

<PAGE>



                                   SIGNATURES

In accordance with the  requirements of the Exchange Act, the registrant  caused
this  report to be  signed on its  behalf  by the  undersigned,  thereunto  duly
authorized.

                            THE X-CHANGE CORPORATION
                                  (Registrant)




DATE: November 14, 2005                            By:/s/ Michael L. Sheriff
                                                   -------------------------
                                                   Michael L. Sheriff,
                                                   Chief Executive Officer
                                                  (Principal Executive Officer)



DATE: November 14, 2005                            By:/s/ Scott R. Thompson
                                                   ------------------------
                                                   Scott R. Thompson,
                                                   Chief Financial Officer
                                                   (Principal Financial Officer)




























                                      F-26