UNITED STATES 
SECURITIES AND EXCHANGE COMMISSIONWashington, DC 20549

Form 10-Q



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(Mark one) 
[X] Quarterly Report Under Section 13 or 15(d) of the Securities Exchange 
Act of 1934

For the quarterly
period ended September 30, 2011

[ ] Transition
Report Under Section 13 or 15(d) of the Securities Exchange 
Act of 1934

For the transition
period from ______________ to _____________





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Commission
File Number: 002-41703

The X-Change
Corporation(Exact Name of Registrant as Specified in Its Charter)

|                             |  |                                
|---------------------------- |  | -------------------------------
|Nevada                       |  | 90-0156146                     
|(State
    of Incorporation) |  | (I.R.S.
    Employer ID Number)



12655 North Central
Expressway, Suite 1000, Dallas, Texas 75243 
(Address of Principal Executive Offices)

(972) 386-7350 
(Registrant's Telephone Number)



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Check whether the issuer (1) filed
all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

YES [X] NO [ ]

Indicate by check mark whether the
registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (ss.232.405 of this chapter) during the preceding 12 months (or for
such shorter period that the registrant was required to submit and post such files).

YES [ ] NO [X]

Indicate by check mark whether the
registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the
definitions of "large accelerated filer", "accelerated filer" and "smaller reporting company" in
Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer [ ] Accelerated
filer [ ] Non-accelerated filer [ ] Smaller reporting company [X]

Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act):

YES
[ ] NO [X]

State the number of shares outstanding
of each of the issuer's classes of common equity as of the latest practicable date: August 19, 2011: 26,341,291

Transitional Small Business Disclosure
Format (check one): YES [ ] NO [X]



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THE X-CHANGE
CORPORATION

Form 10-Q
for the Quarter ended September 30, 2011

Table of
Contents



|                               |                                                                                                   
|------------------------------ | --------------------------------------------------------------------------------------------------
|                               |                                                                                                   
|PART I - FINANCIAL INFORMATION |                                                                                                   
|                               |                                                                                                   
|                               | Item 1 - Financial Statements                                                                     
|                               |                                                                                                   
|                               | Item 2 - Management’s Discussion and Analysis of
    Financial Condition and Results of Operations
|                               |                                                                                                   
|                               | Item 3 - Quantitative and Qualitative Disclosures About Market
    Risk                           
|                               |                                                                                                   
|                               | Item 4 - Controls and Procedures                                                                  
|                               |                                                                                                   
|PART II - OTHER INFORMATION    |                                                                                                   
|                               |                                                                                                   
|                               | Item 1 - Legal Proceedings                                                                        
|                               |                                                                                                   
|                               | Item 1A - Legal Proceedings                                                                       
|                               |                                                                                                   
|                               | Item 2 - Unregistered Sales of Equity Securities and Use
    of Proceeds                          
|                               |                                                                                                   
|                               | Item 3 - Defaults Upon Senior Securities                                                          
|                               |                                                                                                   
|                               | Item 4 - (Removed and Reserved)                                                                   
|                               |                                                                                                   
|                               | Item 5 - Other Information                                                                        
|                               |                                                                                                   
|                               | Item 6 - Exhibits                                                                                 
|                               |                                                                                                   
|SIGNATURES                     | 21                                                                                                





F-1









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PART I -
FINANCIAL INFORMATION

ITEM 1 - FINANCIAL STATEMENTS

|
|
|



|                                                                                 |  |               |             |             
|-------------------------------------------------------------------------------- |  | ------------- | ----------- | ------------
|THE X-CHANGE CORPORATION Balance Sheets September 30, 2011 and December 31, 2010
|                                                                                 |  | September 30, |             | December 31,
|                                                                                 |  | 2011          |             | 2010        
|                                                                                 |  | (unaudited) $ |             | (audited) $ 
|ASSETS                                                                           |  |               |             |             
|Current Assets                                                                   |  |               |             |             
|Cash                                                                             |  |               | 5,459       |             
|Note receivable                                                                  |  |               | —           |             
|Interest receivable                                                              |  |               | —           |             
|Total current assets                                                             |  |               | 5,459       |             
|                                                                                 |  |               |             |             
|License agreeement                                                               |  |               | —           |             
|Intangibles, net of accumulated amortization                                     |  |               |             |             
|of $19,340 and $0                                                                |  |               | 260,660     |             
|Goodwill                                                                         |  |               | 122,268     |             
|TOTAL ASSETS                                                                     |  |               | 388,386     |             
|                                                                                 |  |               |             |             
|LIABILITIES AND STOCKHOLDERS' DEFICIT                                            |  |               |             |             
|Current Liabilities                                                              |  |               |             |             
|Accounts payable                                                                 |  |               | 44,434      |             
|Accrued expenses                                                                 |  |               | 120,000     |             
|Accrued interest payable                                                         |  |               | 123,365     |             
|Notes payable to shareholder                                                     |  |               | 893,168     |             
|Convertible debenture, net or unamortized discount                               |  |               | 285,225     |             
|Loans payable to related party                                                   |  |               | 17,019      |             
|Total current liabilities and total liabilities                                  |  |               | 1,483,211   |             
|                                                                                 |  |               |             |             
|Stockholders’ Deficit                                                            |  |               |             |             
|Preferred stock, $0.001 par value                                                |  |               |             |             
|Authorized 75,000,000 shares                                                     |  |               |             |             
|Issued and outstanding, 0 shares                                                 |  |               | —           |             
|Common stock, $0.001 par value                                                   |  |               |             |             
|Authorized 750,000,000 shares                                                    |  |               |             |             
|Issued and outstanding, 26,341,291shares and                                     |  |               | 26,341      |             
|16,309,916, respectively                                                         |  |               |             |             
|Prepaid consulting                                                               |  |               | (2,823,013  | )           
|Additional paid-in capital                                                       |  |               | 26,541,220  |             
|Accumulated deficit                                                              |  |               | (24,839,372 | )           
|Total stockholders' deficit                                                      |  |               | (1,094,824  | )           
|TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT                                      |  |               | 388,386     |             
|                                                                                 |  |               |             |             



The accompanying notes are an integral part
of these financial statements.







F-2









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|THE X-CHANGE CORPORATION STATEMENTS OF OPERATIONS FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2011 AND 2010 (UNAUDITED) |  |                                          |            |                                         |  |     
|----------------------------------------------------------------------------------------------------------------------------- |  | ---------------------------------------- | ---------- | --------------------------------------- |  | ----
|                                                                                                                              |  |                                          |            |                                        
|                                                                                                                              |  | For the three months ended September 30, |            | For the nine months ended September 30,
|                                                                                                                              |  | 2011                                     |            | 2010                                    |  | 2011
|                                                                                                                              |  |                                          | $          |                                         |  |     
|Revenue                                                                                                                       |  |                                          |            |                                         |  |     
|                                                                                                                              |  |                                          |            |                                         |  |     
|Operating Expenses                                                                                                            |  |                                          |            |                                         |  |     
|Management fees                                                                                                               |  |                                          | 376,987    |                                         |  |     
|Professional fees                                                                                                             |  |                                          | 8,500      |                                         |  |     
|Depreciation and Amortization                                                                                                 |  |                                          | 19,340     |                                         |  |     
|General and administrative                                                                                                    |  |                                          | 26,887     |                                         |  |     
|Total operating expenses                                                                                                      |  |                                          | 431,714    |                                         |  |     
|Net Operating Loss                                                                                                            |  |                                          | (431,714   | )                                       |  |     
|                                                                                                                              |  |                                          |            |                                         |  |     
|Other income (expense)                                                                                                        |  |                                          |            |                                         |  |     
|Interest expense, including amortization of financing fees and note discounts                                                 |  |                                          | (25,602    | )                                       |  |     
|Loss on write-off of note and interest receivable                                                                             |  |                                          | —          |                                         |  |     
|Net Income (Loss) Before Income Taxes                                                                                         |  |                                          | (25,602    | )                                       |  |     
|Income tax provision                                                                                                          |  |                                          | —          |                                         |  |     
|Income tax benefit                                                                                                            |  |                                          | —          |                                         |  |     
|Net tax                                                                                                                       |  |                                          | —          |                                         |  |     
|                                                                                                                              |  |                                          |            |                                         |  |     
|Net Loss From Continuing                                                                                                      |  |                                          |            |                                         |  |     
|Operations                                                                                                                    |  |                                          | (457,316   | )                                       |  |     
|Discontinued operations                                                                                                       |  |                                          | —          |                                         |  |     
|Income tax benefit                                                                                                            |  |                                          | —          |                                         |  |     
|Net Loss                                                                                                                      |  |                                          | (457,316   | )                                       |  |     
|                                                                                                                              |  |                                          |            |                                         |  |     
|Net loss per common share                                                                                                     |  |                                          |            |                                         |  |     
|- Basic and diluted                                                                                                           |  | $                                        | (0.02      | )                                       |  | $   
|                                                                                                                              |  |                                          |            |                                         |  |     
|Weighted average number of                                                                                                    |  |                                          |            |                                         |  |     
|common shares outstanding                                                                                                     |  |                                          | 19,470,058 |                                         |  |     

The accompanying notes are an integral
part of these financial statements.





F-3







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| |  |  |  |  |  |  |  | 
| |  |  |  |  |  |  |  | 

|THE X-CHANGE CORPORATION STATEMENT OF SHAREHOLDERS’ EQUITY/(DEFICIT) FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2011 (Unaudited)
|-----------------------------------------------------------------------------------------------------------------------------
|                                                                                                                             
|                                                                                                                             
|                                                                                                                             
|                                                                                                                             
|Balances at January 1, 2009                                                                                                  
|Effect of August 9, 2010 1 for 20 reverse split                                                                              
|Balances at January 1, 2001, as adjusted                                                                                     
|Common stock issued for debenture conversion                                                                                 
|Balance of issued and outstanding                                                                                            
|stock to transfer agent and historical                                                                                       
|corporate records                                                                                                            
|                                                                                                                             
|Net loss for the year                                                                                                        
|Balances at December 31, 2009                                                                                                
|Common stock issued for debenture conversion                                                                                 
|Effect of issuance at less than “fair value”                                                                                 
|Payment of note principal and accrued interest                                                                               
|Effect of issuance at less than “fair value”                                                                                 
|Acquisition of License Agreement                                                                                             
|                                                                                                                             
|Net loss for the year                                                                                                        
|Balances at December 31, 2010                                                                                                
|Debenture converted into common stock                                                                                        
|Warrants exercised                                                                                                           
|Common stock issued for acquisition                                                                                          
|Common stock for acquisition cancelled                                                                                       
|Cancellation of shares                                                                                                       
|Adjustment to reconcile share cancellation                                                                                   
|Common stock issued for acquisition                                                                                          
|Common stock issued pursuant to                                                                                              
|management agreements                                                                                                        
|Amortization of shares issued for services                                                                                   
|Net loss for the period                                                                                                      
|Balances at September 30, 2011                                                                                               



The accompanying notes are an integral part
of these financial statements.





F-4









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THE X-CHANGE CORPORATION

STATEMENTS OF CASH FLOWS

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2011 AND 2010

(UNAUDITED)

|                                                        |  |                     |          |     
|------------------------------------------------------- |  | ------------------- | -------- | ----
|                                                        |  |                     |          |     
|                                                        |  | For the nine months
|                                                        |  | ended September 30,
|                                                        |  | 2011                |          | 2010
|                                                        |  | $                   |          | $   
|CASH FLOWS FROM OPERATING ACTIVITIES:                   |  |                     |          |     
|Net loss                                                |  |                     | (636,676 | )   
|Plus:                                                   |  |                     |          |     
|Loss from discontinued operations                       |  |                     | —        |     
|Total net loss                                          |  |                     | (636,676 | )   
|Adjustments to reconcile net loss to net                |  |                     |          |     
|cash used in operating activities:                      |  |                     |          |     
|Depreciation                                            |  |                     | —        |     
|Amortization                                            |  |                     | 19,340   |     
|Amortization of prepaid consulting                      |  |                     | 376,987  |     
|Loss on cancellation of license agreement               |  |                     | 11,338   |     
|Loss (gain) on settlement of debt                       |  |                     | 41,260   |     
|Interest expense paid with common stock                 |  |                     | —        |     
|Changes in operating assets and liabilities:            |  |                     |          |     
|Accounts receivable                                     |  |                     | —        |     
|Prepaid expenses and deposits                           |  |                     | —        |     
|Inventory                                               |  |                     | —        |     
|Accounts payable                                        |  |                     | 39,864   |     
|Accrued expenses                                        |  |                     | 22,258   |     
|Accrued interest payable                                |  |                     | 73,293   |     
|CASH FLOWS USED IN OPERATING ACTIVITIES                 |  |                     |          |     
|FROM CONTINUING OPERATIONS                              |  |                     | (52,336  | )   
|CASH FLOWS PROVIDED BY OPERATING                        |  |                     |          |     
|ACTIVITIES FROM DISCONTINUED OPERATIONS                 |  |                     | —        |     
|NET CASH USED IN OPERATING ACTIVITIES                   |  |                     | (52,336  | )   
|CASH FLOWS FROM INVESTING ACTIVITIES                    |  |                     |          |     
|Net liabilities assumed on asset purchase               |  |                     | 107,269  |     
|Goodwill acquired on asset purchase                     |  |                     | (122,268 | )   
|Purchase of property, plant & equipment                 |  |                     | —        |     
|CASH FLOWS USED IN INVESTING ACTIVITIES                 |  |                     | (14,999  | )   
|CASH FLOWS FROM FINANCING ACTIVITIES                    |  |                     |          |     
|                                                        |  |                     |          |     
|Convertible debenture                                   |  |                     |          |     
|Proceeds from the exercise of share purchase warrants   |  |                     | 10,000   |     
|Proceeds from notes payable to shareholders             |  |                     | 55,678   |     
|Repayment of advances from related parties              |  |                     | (3,800   | )   
|CASH FLOWS PROVIDED BY FINANCING ACTIVITIES             |  |                     | 61,878   |     
|NET INCREASE (DECREASE) IN CASH                         |  |                     | 5,459    |     
|CASH, BEGINNING OF PERIOD                               |  |                     | —        |     
|CASH, END OF PERIOD                                     |  |                     | 5,459    |     
|                                                        |  |                     |          |     
|SUPPLEMENTAL CASH FLOW INFORMATION:                     |  |                     |          |     
|Net liabilities assumed with asset purchase             |  |                     | 107,268  |     
|Goodwill acquired on asset purchase                     |  |                     | 122,268  |     
|Conversion of debenture into common stock               |  |                     | 1,000    |     
|Common stock cancelled on license agreement termination |  |                     | 519,038  |     
|Issuance of common stock for warrant exercise           |  |                     | 10,000   |     
|Interest paid                                           |  |                     | —        |     











F-5







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THE X-CHANGE CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2011



1. SUMMARY OF SIGNIFICICANT ACCOUNTING POLICIES

A. Organization and General Description
of Business

The X-Change Corporation (Company)
was incorporated under the laws of the State of Delaware on February 5, 1969 and changed its corporate domicile to the State of
Nevada on October 4, 2000. We were originally organized to seek merger and/or acquisition candidates and engaged in various transactions
since our inception. As of December 31, 2008, the Company has disposed of all operating assets and operating activities.

In March 2010, the Company formed
the wholly-owned subsidiaries - Caballo Blanco Communications, Ltd. and Commerce Services, Inc. - as Colorado corporations to conduct
operations related to the various proposed acquisitions. On December 27, 2010, the Company changed the corporate name of Commerce
Services, Inc. to PolySilicon, Inc. to conduct the business activities related to a then proposed acquisition. There has been no
economic activity conducted within either subsidiary since their formation.

Between March 2010 and October 2010,
the Company announced and abandoned several proposed acquisitions.

On October 7, 2010, the Company
announced that it signed an agreement in principle to acquire 21-Century Silicon, Inc., based in Richardson, Texas (21-Century).
The terms of the acquisition was anticipated to involve a change in control of the Company and the appointment of new directors.
Concurrent with the execution of the agreement in principle, the Company issued 1,000,000 shares of restricted, unregistered common
stock to license 21-Century's technology and to secure an exclusive right to negotiate to acquire certain intellectual property.
The closing of the acquisition was subject to the completion of all appropriate due diligence. On November 8, 2010, 21-Century
executed a note payable to the Company in the amount of approximately $28,500, bearing interest at 10.0% for working capital advances
made by the Company on 21-Century's behalf. On January 17, 2011, the Company announced that through its wholly-owned subsidiary,
PolySilicon, Inc, it had completed the purchase of the intangible assets of 21-Century, subject to an agreement to purchase a $3,500,000
note payable owed to the State of Texas (Texas Note) by 21-Century. On January 28, 2011, the Company announced that it had cancelled
the purchase of 21-Century and canceled its offer to purchase the Texas Note. The purchase of the assets was conditioned on the
Company being able to purchase the Texas Note. The State of Texas' insistence on additional repetitive reviews of the proposed
transaction, which was scheduled for closing, resulted in the Company's inability to complete and close the financing necessary
for silicon manufacturing. Concurrent with this action, the Company rescinded the 1,000,000 shares issued in the October 7, 2010
event and executed its lien on the assets of 21-Century Silicon in satisfaction of a note receivable and accrued interest totaling
approximately $41,200. Upon foreclosure on said assets, the Company's management elected to take a 100% impairment against the
foreclosed value resulting in a charge to operations in the first quarter of 2011 of approximately $41,200. Any gain, if any, upon
the ultimate disposition of said assets will be recognized at the point of future sale.



F-6







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On March 7, 2011, the Company announced
that it had entered into an Agreement and Plan of Exchange with Surrey Vacation Properties, Inc. (a Missouri corporation) (Seller)
to acquire 100% of the issued and outstanding stock of the Seller. In the transaction, it is anticipated that the Company will
issue 63,283,391 restricted, unregistered shares of its $0.001 par value common stock. A copy of the Contract for Sale was filed
as an exhibit to a Current Report on Form 8-K filed with the SEC on or about March 11, 2011. On April 26, 2011, as reported on
a Current Report on Form 8-K filed with the SEC on or about April 28, 2011, the CEO of Surrey Vacation Resorts, Inc. (Surrey) informed
the Company that Surrey would not able to meet a condition of closing of the acquisition of Surrey by the Company. Surrey had been
unable to obtain the necessary written approval of the acquisition transaction from its lenders and further informed the Company
that Surrey would be unable to close the transaction. Upon receipt of this information, the Company agreed to terminate the aforementioned
contract to acquire Surrey Vacation Resorts, Inc.

On May 25, 2011, the Company announced
that it had closed on the purchase of a Casino Ship located in Freeport, Texas. The acquisition was purchased by LDC Collection
Systems, Inc., a newly-formed and wholly-owned subsidiary incorporated under the Laws of the State of Texas. The purchase price
was 2,000,000 shares of restricted, unregistered common stock of the Company with an agreed-upon valuation of approximately $1,750,000.
The Casino ship, known as "The Texas Star Casino", is a 155-foot ocean going vessel equipped with 250 slot machines and
various table games. The ship also has facilities for entertainment, beverage service and dining. The ship was purchased from CJP
Entertainment LLC, a Missouri corporation. The ship was built in 1977 and updated in 1986. The ship previously operated out of
ports located in Georgia and Florida.

On June 6, 2011, the Company has
also entered into a Letter of Intent ("LOI") with George J. Akmon and Jerry Monday & Associates, LLC (collectively
referred to as "Operators") to operate "The Texas Star Casino" outside the nine mile territorial waters of
Texas, in international waters, as a casino ship. As it is the intent to operate the ship outside the 9-mile State of Texas territorial
limit means that the Company, nor its operators, will be required to acquire or hold a gaming license from the State of Texas.

On July 25, 2011, the Company, its
wholly-owned subsidiary, LDC Collection Systems, Inc. and CJP Entertainment LLC, mutually agreed to execute a Repurchase Agreement
whereby the May 25, 2011 transaction was reversed. The Company retained no rights to own or operate the cruise ship and no further
action was taken on the June 6, 2011 LOI to operate said casino ship.

On August 18, 2011, the Company
entered into an Asset Purchase Agreement with Old West Entertainment Corp. (Old West), a corporation formed February 3, 2011 in
accordance with the Laws of the State of Nevada. Prior to this transaction, Old West was not affiliated with or related to the
Company or its management. As part of the Agreement, the Company acquired all right, title and interest in all of Old West's Operating
Entertainment Business (Assets). The Assets include a website, client base, capital assets, hardware, software, intellectual property
as well as all of Old West's artists, properties, patents, trademarks and distribution rights and agreements relating to Old West's
music and entertainment business. The Company also assumed all rights and obligations under a Management Consulting Agreement between
Old West and Arthur Molina Jr. (Molina), also known in the music business as "Frost." In exchange, the Company issued
1,000,000 shares of restricted, unregistered shares of the Company's common stock to Old West with a fair market value of $280,000.
The preliminary allocated of the asset purchase price is as follows:



|Old West Asset Purchase              |  |   |         | 
|------------------------------------ |  | - | ------- | 
|Net liabilities assumed              |  | $ | 107,268 | 
|Acquisition fees                     |  |   | 15,000  | 
|Fair market value of shares issued   |  |   | 280,000 | 
|Preliminary asset purchase valuation |  | $ | 402,268 | 





F-7









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B.  Basis of Presentation



These financial statements and related notes are presented in accordance
with accounting principles generally accepted in the United States, and are expressed in US dollars.  The Company’s
fiscal year end is December 31.



C.  Interim Financial Statement



These statements reflect all normal recurring adjustments, which,
in the opinion of management, are necessary for the fair presentation of financial position, results of operations and cash flows
for the periods presented. The accompanying financial statements should be read in conjunction with Cannabis Science Inc’s
financial statements for the years ended December 31, 2010 and 2009 filed in the Company’s Form 10-K dated April 15, 2011,
which includes all disclosures required by accounting principles generally accepted in the United States of America, or GAAP. The
results of operations for the periods ended September 30, 2011 and 2010 are not necessarily indicative of expected operating results
for the full year.



D. Use of Estimates



The preparation of these financial statements in conformity with
U.S. generally accepted accounting principles requires 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.  The
Company regularly evaluates estimates and assumptions related to stock-based compensation and deferred income tax valuations.  The
Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes
to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of
assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources.  The actual
results experienced by the Company may differ materially and adversely from the Company’s estimates.  To the extent
there are material differences between the estimates and the actual results, future results of operations will be affected.



E. Basic and Diluted Net Income (Loss) Per Share



Under ASC 260, "Earnings Per Share" ("EPS"),
the Company provides for the calculation of basic and diluted earnings per share.  Basic EPS includes no dilution and is computed
by dividing income or loss available to common shareholders by the weighted average number of common shares outstanding for the
period.  Diluted EPS reflects the potential dilution of securities that could share in the earnings or losses of the entity.
 For the periods July 1, 2011 to September 30, 2011, January 1, 2011 to September 30, 2011, and from inception through September
30, 2011, basic and diluted loss per share are the same since the calculation of diluted per share amounts would result in an anti-dilutive
calculation.



F. Cash and Cash Equivalents



The Company considers all highly liquid instruments with maturity
of three months or less at the time of issuance to be cash equivalents.



G. Concentration of Credit Risk

Financial instruments, which potentially
subject us to a concentration of risk, include cash and, in prior periods, accounts receivable. The customers of our former subsidiary,
AirGATE, were based in the United States and we were not subject to exchange risk for accounts receivable.

The Company maintains its cash in domestic financial institutions
subject to insurance coverage issued by the Federal Deposit Insurance Corporation (FDIC). Under FDIC rules, the Company is entitled
to aggregate coverage as defined by Federal regulation per account type per separate legal entity per financial institution. During
the six month period ended September 30, 2011 and the year ended December 31, 2010, and subsequent thereto, respectively, the Company
has not had any had deposits in a financial institution with credit risk exposures in excess of statutory FDIC coverage. The Company
has incurred no losses as a result of any unsecured credit risk exposures.







F-8







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H. Fair Value Measurements



ASC Topic 820, Fair Value Measurements and Disclosures, defines
fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles, and requires
certain disclosures about fair value measurements.  In general, fair values of financial instruments are based upon quoted
market prices, where available.  If such quoted market prices are not available, fair value is based upon internally developed
models that primarily use, as inputs, observable market-based parameters.  Valuation adjustments may be made to ensure that
financial instruments are recorded at fair value.  These adjustments may include amounts to reflect counterparty credit quality
and the customer’s creditworthiness, among other things, as well as unobservable parameters.  Any such valuation adjustments
are applied consistently over time.



I. Income Taxes



Under ASC 740, “Income Tax”, the Company is required
to account for its income taxes through the establishment of a deferred tax asset or liability for the recognition of future deductible
or taxable amounts and operating loss and tax credit carry forwards.  Deferred tax expense or benefit is recognized as a result
of timing differences between the recognition of assets and liabilities for book and tax purposes during the year.



Deferred tax assets and liabilities are measured using enacted tax
rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.
 Deferred tax assets are recognized for deductible temporary differences and operating loss, and tax credit carry forwards.
 A valuation allowance is established to reduce that deferred tax asset if it is "more likely than not" that the
related tax benefits will not be realized.



I. Convertible Debt Instruments

The Company records debt net of debt discount for beneficial conversion features and warrants, on a relative fair value basis.
Beneficial conversion features are recorded pursuant to the Beneficial Conversion Feature and Debt Topics of the FASB Accounting
Standards Codification. The amounts allocated to warrants and beneficial conversion rights are recorded as debt discount and as
additional paid-in-capital. Debt discount is amortized to interest expense over the life of the debt.



J. Debt Financing Arrangements



On August 15, 2006, the Company executed a long-term Promissory
Note (Melissa Note) with Melissa CR 364 Ltd., a Texas limited partnership (Melissa Ltd.) providing a $1,000,000 line of credit.
Melissa Ltd. is managed by a former officer and shareholder of the Company.



The Melissa Note had an initial term of 24 months with interest
accruing at 10% per annum. Accrued interest under the note was payable quarterly beginning November 1, 2006, and the principal
and any remaining accrued interest was due at maturity on August 14, 2008. The Company pledged 100% of the issued and outstanding
common stock of AirGATE as collateral for the note. At the discretion of Melissa Ltd, the Melissa Note may be converted into restricted
common stock of the Company at any time at an agreed upon conversion rate of $0.825 per share. In addition, the Melissa Note may
be prepaid at any time without penalty.



The Company valued and recorded an embedded beneficial conversion
feature in connection with the Melissa Note of $756,950, and amortized this amount over the initial two year life of the note resulting
in non-cash charges to earnings as a component of interest expense through December 31, 2008.







F-9







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At maturity, the Company failed to make the required payment of
the entire outstanding principal and accrued interest due under the Melissa Note. On August 22, 2008, the Company, AirGATE and
the Melissa Ltd. entered into an Amendment to Promissory Note (the Amendment) amending the Melissa Note. The Amendment extended
the maturity date of the Note to December 15, 2008 and, in a supplemental Board action, changed the conversion rate to par value
($0.001 per share). In connection with the Amendment, AirGATE paid Melissa Ltd. (i) $100,000 to be applied against the outstanding
principal of the Melissa Note, (ii) all interest on the Note accrued through August 15, 2008, and (iii) $4,500, representing Melissa
Ltd's attorneys' fees and costs in connection with the Amendment.



After the application of the $100,000 principal payment against
the outstanding principal under the Note, the outstanding principal owed under the Note was $697,794. Interest payments were due
on the 15th of each month beginning September 15, 2008. If either the Company and/or AirGATE completes a corporate financing transaction
before December 15, 2008, whereby either the Company and/or AirGATE receives in excess of $300,000 through the issuance of debt
or equity or a combination thereof, the Company and/or AirGATE agreed to remit to Melissa Ltd. in payment of the obligations under
the Melissa Note, the entire net proceeds of such transaction, or such smaller amount of net proceeds as is necessary to pay the
entire outstanding principal amount of the Melissa Note, plus all accrued interest.



In December 2008, Melissa Ltd. began foreclosure proceedings against
its collateral, which included 100% of the Company's holdings in AirGATE, and the right to convert the Melissa Note into restricted,
unregistered shares of the Company's common stock. The foreclosure proceeding was consummated on January 16, 2009 and the Company's
holdings in AirGATE were forfeited. Additionally, Melissa Ltd. converted approximately $51,000 of principal on the Melissa Note
to 51,000,000 shares of the Company's common stock, concurrent with the maturity date of December 15, 2008.



As of September 30, 2011 and December 31, 2010, the outstanding
balance on the Melissa Note is approximately $822,568 and $806,093, inclusive of capitalized accrued interest. Interest continues
to accrue at 10% per annum.



SOUTH BEACH LIVE, LTD. NOTE

During Calendar 2009, the Company executed a $100,000 Line of Credit
Note Payable with South Beach Live, Ltd. (South Beach), a significant Company stockholder, to provide funds necessary to support
the corporate entity and comply with the periodic reporting requirements of the Securities Exchange Act of 1934, as amended. This
note bears interest at 10.0% and matures in Calendar 2011. Through September 30, 2011 and December 31, 2010, respectively, an aggregate
of approximately $193,168 and $169,250 has been advanced against this note.



LCII DEBENTURES

During the quarter ending September 30, 2007, the Company entered
into a Securities Purchase Agreement with La Jolla Cove Investors, Inc. ("LCII") providing for two convertible debentures
totaling $400,000 with two corresponding sets of non-detachable warrants totaling 4,000,000 shares with an exercise price of $1.00.
The convertible debentures accrue interest at 6-1/4% until converted or the expiration of their three year term. The respective
debentures matured in August 2010; however, in the absence of a formal extension agreement, both parties have agreed to stay the
maturity and allow future conversions and warrant exercises to occur.



The debentures and warrants have mandatory conversion features.
These conversion features becomes effective in the first full calendar month after the common stock underlying the debenture is
either I) registered under the Securities Act of 1933 (the "Act"), which is at the Company's option, or ii) available
by LCII to be resold pursuant to Rule 144 of the Act. If the conversion feature becomes effective, LCII is obliged to convert an
average of 10% of the face value of the debenture each calendar month into a variable number of shares of the Company's common
stock. The number of shares is determined by a formula where the dollar amount of the debenture being converted is multiplied by
eleven, from which the product of the conversion price and ten times the dollar amount of the debenture being converted is then
subtracted, all of which is then divided by the conversion price. The conversion price is equal to the lesser of (I) $1.00, or

(ii) 80% of the average of the 3 lowest volume weighted average
prices during the twenty trading days prior to the conversion election. The Company can prevent conversion if the trading price
falls below $0.30 per share on the date LCII elects to convert. Under certain provisions, if LCII does not convert an average of
at least 5% of the face value of the debenture, the Company may prepay portions of the debenture. As contractually linked, if LCII
converts a portion of the debenture, LCII must also exercise a proportionate amount of the warrants.





F-10







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In the event that the entire $400,000 of the convertible debentures
is converted in conjunction with the required exercise of warrants, the Company will receive a total of $4.4 million from LCII.
The aggregate number of shares issuable to LCII in this event is dependent on the trading price of the Company's common stock over
the term of the conversion process.

The Company allocated the proceeds from the debentures between the
warrants and the debt based on the estimated relative fair value of the warrants and the debt. The value of the warrants was calculated
at $273,634 using the Black-Scholes model and the following assumptions: discount rate of 4.1%, volatility of 156% and expected
term of three years. The Company also calculated a beneficial conversion feature totaling $126,366. The Company is amortizing both
the warrant value and value attributed to the beneficial conversion feature (total $400,000) over the term of the debentures. This
non-cash charge to income is included in interest expense.



At September 30, 2011 and December 31, 2010, respectively, the outstanding
principal amount of convertible debentures totaled approximately $285,225 and $286,225.



K. Stock-Based Compensation



Effective January 1, 2006, the Company adopted ASC 718-10, Compensation
- Stock Compensation ("ASC 718-10"), using the modified-prospective method. Under ASC 718-10, share-based compensation
cost is estimated at the grant date based on the fair value of the award and is recognized as expense, net of estimated pre-vesting
forfeitures, ratably over the applicable period of the award.



L. Goodwill



Goodwill is recorded as the difference, if any, between the aggregate
consideration paid for an acquisition and the fair value of the net tangible and intangible assets acquire. In accordance with
ASC 350, "Goodwill and Intangible Assets", the Company tests goodwill for impairment at the reporting unit level on an
annual basis in the fourth quarter or more frequently if the Company believes indicators of impairment exist. The performance of
the test involves a two-step process. The first step of the impairment test involves comparing the fair values of the applicable
reporting units to their carrying values. If the fair value is greater than the carrying value there is no goodwill impairment.
If the carrying amount of a reporting unit exceeds the reporting unit's fair value, the Company performs the second step of the
goodwill impairment test to determine the amount of impairment loss. The second step of the goodwill impairment test involves comparing
the implied fair value of the affected reporting unit's goodwill with the carrying value of that goodwill.



The Company determined there was no transitional impairment resulting
from the acquisition of Old West Entertainment Corp. assets on August 18, 2011.



M. Intangible Assets



Intangible assets are recorded at cost and are amortized over their
estimated useful lives as follows:





|Website                   | Straight-line over 1 year  | 
|------------------------- | -------------------------- | 
|Contracts                 | Straight-line over 2 years | 
|Human resources           | Straight-line over 3 years | 
|Intellectual property R&D | Straight-line over 1 year  | 













F-11











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N. Recent Accounting Pronouncements



During the year ended December 31, 2010 and through November 22,
2011, there were several new accounting pronouncements issued by the FASB the most recent of which was Accounting Standards Update
2011-09. Each of these pronouncements, as applicable, has been or will be adopted by the Company. Management does not believe the
adoption of any of these accounting pronouncements has had or will have a material impact on the Company’s financial statements.



2. GOING CONCERN



The accompanying financial statements have been prepared in conformity
with U.S. generally accepted accounting principles, which contemplate the continuation of the Company as a going concern. The Company
reported an accumulated deficit of $68,139,436 and had a stockholder’s deficit of $2,038,474 at September 30, 2011.



In view of the matters described, there is substantial doubt as
to the Company's ability to continue as a going concern without a significant infusion of capital. At September 30, 2011, the Company
had minimal operations. There can be no assurance that management will be successful in implementing its plans. The financial statements
do not include any adjustments that might result from the outcome of this uncertainty.



We anticipate that we will have to raise additional capital to fund
operations over the next 12 months. To the extent that we are required to raise additional funds to acquire research and growing
facilities, and to cover costs of operations, we intend to do so through additional public or private offerings of debt or equity
securities. There are no commitments or arrangements for other offerings in place, no guaranties that any such financings would
be forthcoming, or as to the terms of any such financings. Any future financing may involve substantial dilution to existing investors.
We had been relying on our common stock to pay third parties for services which has resulted in substantial dilution to existing
investors.



3. RELATED PARTY TRANSACTIONS

As of September 30, 2011, a total
of $156,818 (December 31, 2010: $107,835) was due to a related party. The amounts due are non-interest bearing, unsecured and have
no specified terms of repayment. This related party also performs management services to the Company under a management consulting
agreement signed on July 1, 2010.

4. PREFERRED STOCK

The Company is authorized to issue
up to a total of 75,000,000 shares of $0.001 par value Preferred Stock. The Company's Board of Directors has designated 250,000
shares as "Series A Convertible Preferred Stock".

The Company 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 Company, 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, 2011 and December 31, 2010, respectively, there
were no shares of preferred stock issued and outstanding.





F-12







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5.  COMMON STOCK

AMENDMENT TO THE ARTICLES OF
INCORPORATION

On January 31, 2011, the Board of
Directors of the Company and its majority shareholder approved an amendment to its Articles of Incorporation increasing the authorized
capital of the Company from 37,500,000 shares of common stock, par value $.001 and 3,750,000 shares of preferred stock, par value
$.001, to 750,000,000 shares of common stock and 75,000,000 share of preferred stock. The Amended Articles were filed with the
Nevada Secretary of State on March 22, 2011, the effective date of the amendment.

REVERSE STOCK SPLIT

Effective August 9, 2010, Company's
Board of Directors declared a 1-for-20 reverse split of the issued and outstanding shares of common stock. The reverse stock split
was implemented by adjusting the stockholders' book entry accounts to reflect the number of shares held by each stockholder following
the split. No fractional shares were issued in connection with the reverse stock split and any fractional shares resulting from
the reverse split were rounded up to the nearest whole share. The reverse stock split reduced the number of the Company's issued
and outstanding shares of common stock on this date from 136,089,746 to approximately 5,513,000.

On January 31September 30, 2011,
the Company's Board of Directors and its majority shareholder approved an amendment to its Articles of Incorporation increasing
the authorized capital of the Company from 37,500,000 shares of $0.001 par value common stock and 3,750,000 shares of $0.001 par
value preferred stock to 750,000,000 shares of $0.001 par value common stock and 75,000,000 shares of $0.001 par value preferred
stock. The Amended Articles were filed with the Nevada Secretary of State on March 22September 30, 2011, the effective date of
the amendment.

The effects of these actions are reflected in the accompanying financial
statements as of the first day of the first period presented.



During the three-months ended September 30, 2011, the Company
issued the following common stock:



On August 18, 2011 the Company issued 1,000,000 restricted and unregistered
common shares, with a fair market value of $280,000, to Old West Entertainment Corp. to purchase its business and assets.



On August 18, 2011 the Company issued 5,000,000



6. INTANGIBLE ASSETS





|Intellectual assets, primarily intellectual property |  | $ | 280,000 | 
|---------------------------------------------------- |  | - | ------- | 
|Less accumulated amortization                        |  |   | 19,340  | 
|                                                     |  | $ | 260,000 | 







Intangible assets are stated at fair value on the date of purchase
less accumulated amortization. Amortization is computed using the straight-line method over the estimated lives of the related
assets (see Notes to Consolidated Financial Statements 1.(m) for relating estimated lives of specific intangible assets).



7. COMMITMENTS



|                | Payments due by period
|--------------- | ----------------------
|                | Total                 
|Operating Lease | $92,000               



On August 25, 2011, the Company signed a two year lease on a 4,000
sq. ft. office, recording studio and TV production facility. Commitments under the lease are $4,000 per month, inclusive of taxes
and maintenance. *The Company has an option to new the lease for an additional 3 years at the same rate of $4,000 per month.



8. SUBSEQUENT EVENTS



None.





F-13









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ITEM 2 - MANAGEMENT'S DISCUSSION
AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(1) CAUTION REGARDING FORWARD-LOOKING
INFORMATION

Certain statements contained in
this quarterly filing, including, without limitation, statements containing the words "believes", "anticipates",
"expects", "aims" and words of similar import, constitute forward-looking statements. Such forward-looking
statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements
of the Company, or industry results, to be materially different from any future results, performance or achievements expressed
or implied by such forward-looking statements.

Such factors include, among others,
the following: international, national and local general economic and market conditions: demographic changes; the ability of the
Company to sustain, manage or forecast its growth; the ability of the Company to successfully make and integrate acquisitions;
raw material costs and availability; new product development and introduction; existing government regulations and changes in,
or the failure to comply with, government regulations; adverse publicity; competition; the loss of significant customers or suppliers;
fluctuations and difficulty in forecasting operating results; changes in business strategy or development plans; business disruptions;
the ability to attract and retain qualified personnel; the ability to protect technology; and other factors referenced in this
and previous filings.

Given these uncertainties, readers
of this Form 10-Q/A and investors are cautioned not to place undue reliance on such forward-looking statements. The Company disclaims
any obligation to update any such factors or to publicly announce the result of any revisions to any of the forward-looking statements
contained herein to reflect future events or developments.

(2) GENERAL

The X-Change Corporation (Company)
was incorporated under the laws of the State of Delaware on February 5, 1969 and changed its corporate domicile to the State of
Nevada on October 4, 2000. We were originally organized to seek merger and/or acquisition candidates and engaged in various transactions
since our inception. As of December 31, 2008, the Company has disposed of all operating assets and operating activities.

In March 2010, the Company formed
the wholly-owned subsidiaries - Caballo Blanco Communications, Ltd. and Commerce Services, Inc. - as Colorado corporations to conduct
operations related to the various proposed acquisitions. On December 27, 2010, the Company changed the corporate name of Commerce
Services, Inc. to PolySilicon, Inc. to conduct the business activities related to a then proposed acquisition. There has been no
economic activity conducted within either subsidiary since their formation.

Between March 2010 and October 2010,
the Company announced and abandoned several proposed acquisitions.







14









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On October 7, 2010, the Company
announced that it signed an agreement in principle to acquire 21-Century Silicon, Inc., based in Richardson, Texas (21-Century).
The terms of the acquisition was anticipated to involve a change in control of the Company and the appointment of new directors.
Concurrent with the execution of the agreement in principle, the Company issued 1,000,000 shares of restricted, unregistered common
stock to license 21-Century's technology and to secure an exclusive right to negotiate to acquire certain intellectual property.
The closing of the acquisition was subject to the completion of all appropriate due diligence. On November 8, 2010, 21-Century
executed a note payable to the Company in the amount of approximately $28,500, bearing interest at 10.0% for working capital advances
made by the Company on 21-Century's behalf. On January 17, 2011, the Company announced that through its wholly-owned subsidiary,
PolySilicon, Inc, it had completed the purchase of the intangible assets of 21-Century, subject to an agreement to purchase a $3,500,000
note payable owed to the State of Texas (Texas Note) by 21-Century. On January 28, 2011, the Company announced that it had cancelled
the purchase of 21-Century and canceled its offer to purchase the Texas Note. The purchase of the assets was conditioned on the
Company being able to purchase the Texas Note. The State of Texas' insistence on additional repetitive reviews of the proposed
transaction, which was scheduled for closing, resulted in the Company's inability to complete and close the financing necessary
for silicon manufacturing. Concurrent with this action, the Company rescinded the 1,000,000 shares issued in the October 7, 2010
event and executed its lien on the assets of 21-Century Silicon in satisfaction of a note receivable and accrued interest totaling
approximately $41,200. Upon foreclosure on said assets, the Company's management elected to take a 100% impairment against the
foreclosed value resulting in a charge to operations in the first quarter of 2011 of approximately $41,200. Any gain, if any, upon
the ultimate disposition of said assets will be recognized at the point of future sale.

On March 7, 2011, the Company announced
that it had entered into an Agreement and Plan of Exchange with Surrey Vacation Properties, Inc. (a Missouri corporation) (Seller)
to acquire 100% of the issued and outstanding stock of the Seller. In the transaction, it is anticipated that the Company will
issue 63,283,391 restricted, unregistered shares of its $0.001 par value common stock. A copy of the Contract for Sale was filed
as an exhibit to a Current Report on Form 8-K filed with the SEC on or about March 11, 2011. On April 26, 2011, as reported on
a Current Report on Form 8-K filed with the SEC on or about April 28, 2011, the CEO of Surrey Vacation Resorts, Inc. (Surrey) informed
the Company that Surrey would not able to meet a condition of closing of the acquisition of Surrey by the Company. Surrey had been
unable to obtain the necessary written approval of the acquisition transaction from its lenders and further informed the Company
that Surrey would be unable to close the transaction. Upon receipt of this information, the Company agreed to terminate the aforementioned
contract to acquire Surrey Vacation Resorts, Inc.

On May 25, 2011, the Company announced
that it had closed on the purchase of a Casino Ship located in Freeport, Texas. The acquisition was purchased by LDC Collection
Systems, Inc., a newly-formed and wholly-owned subsidiary incorporated under the Laws of the State of Texas. The purchase price
was 2,000,000 shares of restricted, unregistered common stock of the Company with an agreed-upon valuation of approximately $1,750,000.
The Casino ship, known as "The Texas Star Casino", is a 155-foot ocean going vessel equipped with 250 slot machines and
various table games. The ship also has facilities for entertainment, beverage service and dining. The ship was purchased from CJP
Entertainment LLC, a Missouri corporation. The ship was built in 1977 and updated in 1986. The ship previously operated out of
ports located in Georgia and Florida.



15







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On June 6, 2011, the Company has
also entered into a Letter of Intent ("LOI") with George J. Akmon and Jerry Monday & Associates, LLC (collectively
referred to as "Operators") to operate "The Texas Star Casino" outside the nine mile territorial waters of
Texas, in international waters, as a casino ship. As it is the intent to operate the ship outside the 9-mile State of Texas territorial
limit means that the Company, nor its operators, will be required to acquire or hold a gaming license from the State of Texas.

On July 25, 2011, the Company, its
wholly-owned subsidiary, LDC Collection Systems, Inc. and CJP Entertainment LLC, mutually agreed to execute a Repurchase Agreement
whereby the May 25, 2011 transaction to purchase a Casino Ship located in Freeport, Texas. The original transaction was valued
at approximately $1,750,000 (which approximated 21.9% of a November 8, 2006 independent third-party appraisal by Cruise Research
and Management of the casino ship) (see Exhibit 99.1 of the Company's Current Report on Form 8-K filed on or about June 2, 2011)
and consideration of 2,000,000 shares of the Company's restricted, unregistered common stock was issued to the seller. Concurrent
with the execution of the July 25, 2011 Repurchase Agreement, the 2,000,000 shares of the Company's common stock held by the CJP
Entertainment LLC was returned to the Company and cancelled. As the Company retained no rights to own or operate the cruise ship,
no further action was taken by Management, George J. Akmon and/or Jerry Monday & Associates, LLC with regard to the June 6,
2011 LOI to operate said casino ship and said negotiations and obligations ceased on the part of all parties. Pursuant to the appropriate
accounting literature, this transaction is reflected in the accompanying restated financial statements net of all the aforementioned
events as of September 30, 2011.

On August 18, 2011, the Company
entered into an Asset Purchase Agreement with Old West Entertainment Corp. (Old West), a corporation formed February 3, 2011 in
accordance with the Laws of the State of Nevada. Prior to this transaction, Old West was not affiliated with or related to the
Company or its management. As part of the Agreement, the Company acquired all right, title and interest in all of Old West's Operating
Entertainment Business (Assets). The Assets include a website, client base, capital assets, hardware, software, intellectual property
as well as all of Old West's artists, properties, patents, trademarks and distribution rights and agreements relating to Old West's
music and entertainment business. The Company also assumed all rights and obligations under a Management Consulting Agreement between
Old West and Arthur Molina Jr. (Molina), also known in the music business as "Frost." In exchange, the Company issued
1,000,000 shares of restricted, unregistered shares of the Company's common stock to Old West. In addition, the Company issued
5,000,000 shares of restricted, unregistered shares of the Company's common stock each to Arturo Molina Jr. (Frost) for management
services as President and Bogat Family Trust as consideration for the management services that beneficiaries of the Trust will
be providing to the Company in operating the music and entertainment portion of the business over the next 12 months.

(3) PLAN OF BUSINESS

The Company’s primary business
is now that of Old West and specifically for the entertainment industry including music, developing new artists, movies, TV shows,
and concert and event promotion.

Old West is focused on hip-hop entertainment
and is headed by Arturo Molina Jr. (Frost), a rapper and hip-hop legend. The Company specializes in all aspects of entertainment
including music, feature films, television, home video/DVD and major events. The Company currently operates a Sunday night drive
radio show hosted by Frost whom also has his music featured and representation through Old West.

In August 2011, the Company has
opened a new recording and production studio to develop its media assets and an administrative office to manage the business and
operations of Old West.





16







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(4) RESULTS OF OPERATIONS

The Company had no revenue for either
of the nine or three month periods ended September 30, 2011 and 2010, respectively. Management anticipates revenue to be generated
from the business of Old West as the operations are built out and the business plan is implemented.

General and administrative expenses
for the nine months ended September 30, 2011 and 2010 were $102,263 and $93,302, respectively. General and administrative expenses
were $26,887 and $28,762 for the three months ended September 30, 2011 and 2010, respectively. This increase is due to increased
operating costs resulting from the Old West asset purchase on August 18, 2011.

Management fees for the three and
nine months ended September 30, 2011 and 2010 were $376,987 and $0, respectively. This increase is due to increased expense relating
to management agreements signed with Frost and Bogat Family Trust in conjunction with the asset purchase of Old West.

Other increases were amortization
relating to the intangible assets acquired from Old West and professional fees incurred.

As of the date of this filing, we
do not have any other specific business combination under consideration and we have not (nor has anyone on our behalf), directly
or indirectly, contacted any prospective target business or had any discussions, formal or otherwise, with respect to such a transaction
with us. We have not (nor have any of our agents or affiliates) been approached by any candidates (or representative of any candidates)
with respect to a possible acquisition transaction with our company. Additionally, we have not engaged or retained any agent or
other representative to identify or locate any suitable acquisition candidate for us.

The Company recognized interest
accruals, amortization of debt financing fees and accretion of debt discounts of $88,326 and $202,188 during the nine months ended
September 30, 2011 and 2010, respectively. Interest accruals, amortization of debt financing fees and accretion of and debt discounts
of $25,602 and $38,621 were recorded during the three months ended September 30, 2011 and 2010, respectively. The Company's convertible
debenture with La Jolla Cove Investors, Inc. matured in August 2010. This debenture is discussed more fully in our Annual Report
on Form 10-K for the year ended December 31, 2010. We specifically note that all of the Company's debt is in default due to the
December 2008 foreclosure action and, accordingly, has been classified as "current" on the Company's balance sheet regardless
of the stated maturity date(s).

Earnings per share for the respective
nine month periods ended September 30, 2011 and 2010 were $(0.04) and $(0.05), respectively, based on the weighted-average shares
issued and outstanding at the end of each respective period as adjusted for the August 2010 1-for-20 reverse stock split. Earnings
per share for the respective three month periods ended September 30, 2011 and 2010 were $(0.02) and $(0.01), respectively.

The Company does not expect to generate
any meaningful revenue or incur operating expenses for purposes other than fulfilling the obligations of a reporting company under
the Securities Exchange Act of 1934 unless and until such time that the Company completes a business combination transaction.







17







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(5) LIQUIDITY AND CAPITAL RESOURCES

At September 30, 2011 and December
31, 2010 the Company had a working capital of approximately $(1,477,752) and $(1,137,097), respectively.

The Company has in sufficient working
capital to sustain operations and fulfill its business plans under Old West. No formal commitments or arrangements to advance or
loan funds to the Company or repay any such advances or loans exist. There is no legal obligation for either management or significant
stockholders to provide additional future funding.

Further, the Company is at the mercy
of future economic trends and business operations for this controlling stockholders to have the resources available to support
the Company. Should their pledges fail to provide financing, the Company has not identified any alternative sources of working
capital to support the Company.

The Company's ultimate continued
existence is dependent upon its ability to generate sufficient cash flows from operations to support its daily operations as well
as provide sufficient resources to retire existing liabilities and obligations on a timely basis. The Company faces considerable
risk in its business plan and a potential shortfall of funding due any potential inability to raise capital in the equity securities
market. If adequate operating capital and/or cash flows are not received during the next twelve months, the Company could become
dormant until such time as necessary funds could become available.

The Company anticipates future sales
or issuances of equity securities to fulfill its business plan. However, there is no assurance that the Company will be able to
obtain additional funding through the sales of additional equity securities or, that such funding, if available, will be obtained
on terms favorable to or affordable by the Company.

The Company's Articles of Incorporation
authorize the issuance of up to 75,000,000 shares of preferred stock and 750,000,000 shares of common stock. The Company's ability
to issue preferred stock may limit the Company's ability to obtain debt or equity financing as well as impede potential takeover
of the Company, which may be in the best interest of stockholders. The Company's ability to issue these authorized but unissued
securities may also negatively impact our ability to raise additional capital through the sale of our debt or equity securities.

While the Company is of the opinion
that good faith estimates of the Company's ability to secure additional capital in the future to reach its goals have been made,
there is no guarantee that the Company will receive sufficient funding to sustain operations or implement any future business plan
steps.

Regardless of whether the Company's
cash assets prove to be inadequate to meet the Company's operational needs, the Company might seek to compensate providers of services
by issuances of stock in lieu of cash.







18







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(6) CRITICAL ACCOUNTING POLICIES

Our financial statements and related
public financial information are based on the application of accounting principles generally accepted in the United States (GAAP).
GAAP requires the use of estimates; assumptions, judgments and subjective interpretations of accounting principles that have an
impact on the assets, liabilities, revenue and expense amounts reported. These estimates can also affect supplemental information
contained in our external disclosures including information regarding contingencies, risk and financial condition. We believe our
use of estimates and underlying accounting assumptions adhere to GAAP and are consistently and conservatively applied. We base
our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances.
Actual results may differ materially from these estimates under different assumptions or conditions. We continue to monitor significant
estimates made during the preparation of our financial statements.

Our significant accounting policies
are summarized in Note 1 of our financial statements. While all these significant accounting policies impact our financial condition
and results of operations, we view certain of these policies as critical. Policies determined to be critical are those policies
that have the most significant impact on our financial statements and require management to use a greater degree of judgment and
estimates. Actual results may differ from those estimates. Our management believes that given current facts and circumstances,
it is unlikely that applying any other reasonable judgments or estimate methodologies would cause effect on our consolidated results
of operations, financial position or liquidity for the periods presented in this report.

During the year ended December 31,
2010 and through November 22, 2011, there were several new accounting pronouncements issued by the FASB the most recent of which
was Accounting Standards Update 2011-09. Each of these pronouncements, as applicable, has been or will be adopted by the Company.
Management does not believe the adoption of any of these accounting pronouncements has had or will have a material impact on the
Company’s financial statements.

ITEM 3 - QUANTITATIVE AND QUALITATIVE
DISCLOSURES ABOUT MARKET RISK

The Company may be subject to certain
market risks, including changes in interest rates and currency exchange rates. At the present time, the Company does not undertake
any specific actions to limit those exposures.

ITEM 4 - CONTROLS AND PROCEDURES

(a) Evaluation of Disclosure Controls
and Procedures

As of September 30, 2011, our management,
under the supervision and with the participation of our Chief Executive and Financial Officer (Certifying Officer), evaluated the
effectiveness of our disclosure controls and procedures as defined in Rules 13a-15 promulgated under the Exchange Act. Disclosure
controls and procedures are controls and procedures designed to ensure that information required to be disclosed in our reports
filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in
the Commission's rules and forms and include controls and procedures designed to ensure that information we are required to disclose
in such reports is accumulated and communicated to management, including our Certifying Officer, as appropriate, to allow timely
decisions regarding required disclosure. Based upon that evaluation, our Certifying Officer concluded that, as of September 30,
2011, our disclosure controls and procedures were not effective to ensure that the information required to be disclosed by us in
our reports is recorded, processed, summarized and reported within the time periods specified by the SEC due to a inherent weakness
in our internal controls over financial reporting due to our status as a shell corporation and having a sole officer and director.
However, our Certifying Officer believe that the restated financial statements included in this report fairly present, in all material
respects, our financial condition, results of operations and cash flows for the respective periods presented.

(b) Changes in Internal Controls

There were no significant changes
(including corrective actions with regard to significant deficiencies or material weaknesses) in our internal controls over financial
reporting that occurred during the quarter ended September 30, 2011 that has materially affected, or is reasonably likely to materially
affect, our internal control over financial reporting. Existing internal controls of Old West were adopted upon completion of the
asset purchase on August 18, 2011 in addition to ensuring the overall controls and procedures of the Company were met.







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PART II -
OTHER INFORMATION

ITEM 1 - LEGAL PROCEEDINGS

The Company may become involved
in various claims and legal actions arising in the ordinary course of business. In the opinion of management, the ultimate disposition
of these matters should not have an adverse material impact either individually or in the aggregate on results of operations, financial
position or cash flows of the Company.

ITEM 1A - RISK FACTORS

Not applicable

ITEM 2 - UNREGISTERED SALES OF
EQUITY SECURITIES AND USE OF PROCEEDS

On July 25, 2011, the Company, its
wholly-owned subsidiary, LDC Collection Systems, Inc. and CJP Entertainment LLC, mutually agreed to execute a Repurchase Agreement
whereby the May 25, 2011 transaction to purchase a Casino Ship located in Freeport, Texas. Concurrent with the execution of the
July 25, 2011 Repurchase Agreement, the 2,000,000 shares of the Company's common stock held by the CJP Entertainment LLC was returned
to the Company and cancelled.

On August 18, 2011, the Company
issued 1,000,000 restricted and unregistered common shares, with a fair market value of $280,000, to Old West Entertainment Corp.
under an asset purchase agreement.

On August 18, 2011, the Company
issued 5,000,000 shares of restricted, unregistered shares of the Company's common stock each to Arturo Molina Jr. (Frost) for
management services as President and Bogat Family Trust as consideration for the management services that beneficiaries of the
Trust will be providing to the Company in operating the music and entertainment portion of the business over the next 12 months.
The shares had a fair market value of $0.32.

ITEM 3 - DEFAULTS ON SENIOR SECURITIES

None.

ITEM 4 - (REMOVED AND RESERVED)

ITEM 5 - OTHER INFORMATION

None.

ITEM 6 - EXHIBITS

31.1 Certification pursuant to Section
302 of Sarbanes-Oxley Act of 2002 
32.1 Certification pursuant to Section 906 of Sarbanes-Oxley Act of 2002









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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                        | 
|------------------------ | ----------------------------------------------- | 
|
|
|Dated: November 22, 2011 | By: /s/ Arthur Molina, Jr.                      | 
|                         | Arthur Molina, Jr.                              | 
|                         | Chairman, Chief Executive Officer,              | 
|                         | Acting Chief Financial Officer and
    Director | 















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