Document:

Exhibit 4.1

 

THIS OPTION MAY NOT BE EXERCISED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”),
COVERING THE ISSUANCE OF THE SHARES ACQUIRED UPON SUCH EXERCISE OR AN OPINION
OF COUNSEL, SATISFACTORY TO THE ISSUER, THAT REGISTRATION UNDER THE ACT IS NOT
REQUIRED.

IF THE SHARES ACQUIRED UPON EXERCISE OF THIS OPTION ARE ISSUED WITHOUT
REGISTRATION UNDER THE ACT, SUCH SHARES MAY NOT BE SOLD, ASSIGNED, PLEDGED OR
OTHERWISE TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE  ACT COVERING THE TRANSFER OR
AN OPINION OF COUNSEL, SATISFACTORY TO THE ISSUER, THAT REGISTRATION UNDER THE
ACT IS NOT REQUIRED.

KEY
ENERGY SERVICES, INC.

STOCK
OPTION AGREEMENT

NONSTATUTORY STOCK OPTION

(Not
Issued Under the Key Energy Group, Inc. 1997 Incentive Plan)

Optionee:                                   

1.             ­Grant
of Stock Option.  As of the Grant
Date (identified in Section 25 below), Key Energy Services, Inc., a
Maryland corporation  (the “Company”), hereby grants a nonstatutory stock option (the “Option”) to the Optionee (identified above), an Employee or
Outside Director of, or Consultant to (as each such term is defined in Section
2 below), the Company, to purchase the number of shares of the Company’s
common stock, $0.10 par value per share (the “Common Stock”),
identified in Section 25 below (the “Shares”),
subject to the terms and conditions of this agreement (the “Agreement”).  The
Shares, when issued to Optionee upon the exercise of the Option, shall be fully
paid and nonassessable.

The Option is not
an “incentive stock option” as defined in Section 422 of the Internal Revenue
Code of 1986, as amended (the “Code”).

The Option is not
intended to be a plan that is subject to the Employee Retirement Income
Security Act of 1974, as amended (“ERISA”) and
shall be interpreted, construed and administered consistent with its status as
a plan that is not subject to ERISA.

2.             Definitions. The
following terms shall have the meanings set forth below:

a.             ­Board.  The Board of Directors of the Company.

b.             ­Cause.  When used in connection with the termination
of an Optionee’s Employment, shall mean the termination of the Optionee’s
Employment by the Company by reason of (i) the conviction of the Optionee by a
court of competent jurisdiction as to which no further appeal can be taken of a
crime involving moral turpitude or a felony; (ii) the proven commission by the
Optionee of an act of fraud upon the Company; (iii) the willful and proven
theft, embezzlement or other misappropriation of any funds or property of the
Company by the Optionee; (iv) the willful and continued failure by the Optionee
to perform the material duties assigned to him; (v) the knowing engagement by
the Optionee in any direct, material conflict of interest with the Company
without compliance with the Company’s conflict of interest policy, if any, then
in effect; (vi) the knowing engagement by the Optionee, without the written
approval of the Board, in any activity which competes with the business of the
Company or which would result in a material injury to the business, reputation
or goodwill of the Company; (vii) the unauthorized disclosure of trade secrets
or proprietary information of the Company or of a third party who has entrusted
such information to the Company, (viii) the knowing and intentional engagement
in any activity which would constitute a material violation of the provisions
of the Company’s policies and procedures manual, if any, then in effect; or
(ix) a termination for Cause as defined in any employment agreement with the
Optionee.  For purposes of this
definition of “Cause”, the term “Company” shall also refer to any Parent or
Subsidiary.

c.             Change in Control.  Any of the events described in and subject to
Section 17.

d.             Code. 
The Internal Revenue Code of 1986, as amended, and the regulations,
interpretations and other authority promulgated thereunder.  References herein to any provision of the
Code shall refer to any successor provision thereto.

e.             Committee.  The Committee shall be the Compensation
Committee of the Board, or any subcommittee of the Compensation Committee.  The Board shall have the power to fill
vacancies on the Committee arising by resignation, death, removal or otherwise.  The Board, in its sole discretion, may
bifurcate the powers and duties of the Committee among one or more separate
committees, or retain all powers and duties of the Committee in a single
Committee.  The members of the Committee
shall serve at the discretion of the Board.

Notwithstanding the
preceding paragraph, the term “Committee,” as used herein with respect to any
Option granted to an Outside Director or a member of the Committee, shall refer
to the Board.  In the case of an Option
for an Outside Director or a member of the Committee, the Board shall have all
the powers and responsibilities of the Committee hereunder as to such Option,
and any actions as to such Option may be acted upon only by the Board (unless
it otherwise designates in its discretion).

f.              Common Stock.  The common stock of the Company, $0.10 par
value per share, and any class of common stock into which such common shares
may hereafter be converted, reclassified or recapitalized.

g.             Company.  Key Energy Services, Inc., a corporation
organized under the laws of the State of Maryland, and any successor in
interest thereto.

h.             Consultant. 
An independent agent, consultant, attorney, an individual who has
agreed to become an Employee, or any other individual who is not an Outside
Director or employee of the Company (or any Parent or Subsidiary) and who, in
the opinion of the Committee, is in a position to contribute materially to the
growth or financial success of the Company (or any Parent or Subsidiary).

i.              ­Disability. 
As determined by the Committee in its discretion exercised in
good faith, a physical or mental condition of the Employee that would entitle
him to payment of disability income payments under the Company’s long term
disability insurance policy  or plan for
employees, as then effective, if any; or in the event that the Optionee is not
covered, for whatever reason, under the Company’s long-term disability
insurance policy or plan.  “Disability”
means a permanent and total disability as defined in Section 22(e)(3) of the
Code.  A determination of Disability may
be made by a physician selected or approved by the Committee and, in this
respect, the Optionee shall submit to an examination by such physician upon
request.

j.              ­Employee. 
Any employee of the Company (or any Parent or Subsidiary)
within the meaning of Section 3401(c) of the Code who, in the opinion of the
Committee, is one of a select group of executive officers, other officers, or
other key personnel of the Company (or any Parent or Subsidiary), who is in a
position to contribute materially to the growth and development and to the
financial success of the Company (or any Parent or Subsidiary), including,
without limitation, officers who are members of the Board.

k.             ­Employment. 
Employment by the Company (or any Parent or Subsidiary), or
by any corporation issuing or assuming an Option in any transaction described
in Section 424(a) of the Code, or by a parent corporation or a subsidiary
corporation of such corporation issuing or assuming such Option, the
parent-subsidiary relationship shall be determined at the time of the corporate
action described in Section 424(a) of the Code. 
In this regard, neither the transfer of a Optionee from Employment by
the Company to Employment by any Parent or Subsidiary, nor the transfer of a
Optionee from Employment by any Parent or Subsidiary to Employment by the
Company, shall be deemed to be a termination of Employment of the
Optionee.  Moreover, the Employment of an
Optionee shall not be deemed to have been terminated because of absence from
active Employment on account of temporary illness or during authorized vacation
or during temporary leaves of absence from active Employment granted for
reasons of professional advancement, education, health, or government service,
or during military leave for any period (if the Optionee returns to active
Employment within 90 days after the termination of military leave), or during
any period required to be treated as a leave of absence by virtue of any
applicable statute, Company personnel policy or agreement.

The term “Employment” for
purposes hereof  will also include
compensatory services performed by a Consultant for the Company (or any Parent
or Subsidiary) as well as membership on the Board by an Outside Director.

l.              Employment Agreement. At any time, any
agreement in effect at such time between the Company or any of its Subsidiaries
and the Optionee, whether dated before or after the date of the Option, which
relates to the Employment of the Optionee by the Company or any of its
Subsidiaries or compensation to be paid following the termination of the
Employment of the Optionee by the Company or any of its Subsidiaries.

m.            ­Exchange Act. 
The Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder.

n.             ­Fair Market Value.  The fair market value of one share
of Common Stock on the date in question, which is deemed to be (i) the closing
sales price on the immediately preceding business day of a share of Common
Stock as reported on the principal securities exchange on which Shares are then
listed or admitted to trading, or (ii) if not so reported, the average of
the closing bid and asked prices for a Share on the immediately preceding
business day as quoted on the National Association of Securities Dealers
Automated Quotation System (“NASDAQ”), or (iii) if not quoted on NASDAQ,
the average of the closing bid and asked prices for a Share as quoted by the
National Quotation Bureau’s “Pink Sheets” or the National Association of
Securities Dealers’ OTC Bulletin Board System. 
If there was no public trade of Common Stock on the date in question,
Fair Market Value shall be determined by reference to the last preceding date
on which such a trade was so reported.

If the Common Stock is
not traded in accordance with clauses (i), (ii) or (iii) of the preceding
paragraph at the time a determination of its Fair Market Value is required to
be made hereunder, the determination of Fair Market Value for purposes hereof
shall be made by the Committee in its discretion exercised in good faith.  In this respect, the Committee may rely on
such financial data, valuations or experts as it deems advisable under the
circumstances.

o.             ­Insider. 
An individual who is, on the relevant date, an officer,
director or ten percent (10%) beneficial owner of any class of the Company’s
equity securities that is registered pursuant to Section 12 of the Exchange
Act, all as defined under Section 16 of the Exchange Act.

p.             ­Optionee. 
Any Employee, Consultant or Outside Director who is granted
an Option.

q.             ­Option Price. 
The exercise price at which the Shares may be purchased by
the Optionee of a Stock Option.

r.              ­Outside Director.  A member of the Board who is not,
at the time of grant of an Option, an employee of the Company or any Parent or
Subsidiary.

s.             ­Parent.  Any corporation (whether now or hereafter
existing) which constitutes a “parent” of the Company, as defined in Section
424(e) of the Code.

t.              ­­Stock Option or Option.  A stock option granted to an Employee,
Consultant or Outside Director, pursuant to which the Optionee has the right to
purchase Shares of Common Stock and which is not intended to qualify an “incentive
stock option” under Section 422 of the Code.

u.             ­Subsidiary. 
Any corporation (whether now or hereafter existing) which
constitutes a “subsidiary” of the Company, as defined in Section 424(f) of the
Code.

3.             ­Option
Term.  The Option shall commence on
the Grant Date (identified in Section 25 below) and terminate on the
date immediately prior to the tenth (10th) anniversary of the Grant Date.  The period during which the Option is in
effect and may be exercised is referred to herein as the “Option
Period”.

4.             ­Option Price. 
The Option Price per Share is identified in Section 25
below.

5.             ­Vesting.  The
total number of Shares subject to this Option shall vest in accordance with the
Vesting Schedule (identified in Section 25 below).  The Shares may be purchased at any time after
they become vested, in whole or in part, during the Option Period; provided,
however, the Option may only be exercisable to acquire whole Shares.  The right of exercise provided herein shall
be cumulative so that if the Option is not exercised to the maximum extent
permissible after vesting,  the vested
portion of the Option shall be exercisable, in whole or in part, at any time
during the Option Period.

6.             ­Method of Exercise. 
The Option is exercisable by delivery of a written notice of exercise to
the attention of the Secretary of the Company in the form attached hereto as Exhibit
A, no fewer than five business days prior to the proposed effective date of
exercise, signed by the Optionee, specifying the number of Shares to be
acquired on, and the effective date of, such exercise.  The Optionee may withdraw notice of exercise
of this Option at any time prior to the close of business on the business day
preceding the proposed exercise date, and in this instance, the Company will
return this Agreement to the Optionee. 
No Option may be exercised for fractional shares.

7.             ­Method of Payment. 
The Option Price upon exercise of the Option shall be payable to the
Company in cash or its equivalent.

The
Committee, in its sole discretion, may allow (i) a “cashless exercise” as
permitted under Federal Reserve Board’s Regulation T, 12 CFR Part 220 (or its
successor), and subject to applicable securities law restrictions and tax
withholdings, or (ii) any other means of exercise which the Committee, in its
sole discretion, determines to be consistent with applicable law.

As
soon as practicable after receipt of a written notification of exercise and
full payment, the Company shall deliver to or on behalf of the Optionee, in the
name of the Optionee or other appropriate recipient, certificates for the
number of Shares purchased under the Stock Option.  Such delivery shall be effected for all
purposes when a stock transfer agent of the Company shall 

have deposited
such certificates in the United States mail, addressed to Optionee or other
appropriate recipient.

During
the lifetime of a Optionee, each Option granted to him shall be exercisable
only by the Optionee or a broker-dealer acting on his behalf pursuant to a
cashless exercise under the foregoing provisions of this Section 7.  Except as permitted under Section 8,
no Option shall be assignable or transferable by Optionee otherwise than by
will or by the laws of descent and distribution.

8.             Transferability.

a.             ­Non-Transferable
Options. No Option will be assignable, saleable, or otherwise transferable
by a Optionee except by will or by the laws of descent and distribution, except
that an Option may be transferable to a charitable trust or other charitable
organization or to an educational institution, and no Option will be subject to
any encumbrance, pledge, lien, assignment or charge of any nature; provided,
however, that, upon the request of the Optionee and pursuant to the consent or
authorization of the Committee acting in its sole discretion, an Option may be
assignable or otherwise transferable by a Optionee solely to his or her spouse
pursuant to a marital settlement or similar agreement or decree of absolute
divorce.

No transfer by will or by
the laws of descent and distribution or other transfer permitted under this Section
8 shall be effective to bind the Company unless the Committee has been
furnished with a copy of the deceased Optionee’s enforceable will, marital
settlement or similar agreement, decree of absolute divorce or such other
evidence as the Committee deems necessary to establish the validity of the
transfer.  Any attempted transfer in
violation of this Section 8 shall be void and ineffective.

b.             ­Ability
to Exercise Rights.  Subject to a
beneficiary designation pursuant to Section 9, only the Optionee (or his
legal guardian in the event of Optionee’s Disability), or in the event of a
permitted transfer, his transferee, may exercise Options, receive cash payments
and deliveries of Shares, and otherwise assume the rights of the Optionee.

c.             ­Restrictions
on Exercise of Options.  The
Committee may further restrict the exercise of any Option by prohibiting such
exercise at any time during which and for such period of time as any Optionee
(or any transferee thereof permitted hereunder) is engaged in any activity
determined by the Committee, after full consideration of the facts presented on
behalf of the Company and the Optionee (or any transferee thereof permitted
hereunder), to be detrimental to the best interests of the Company and its
shareholders.  The Committee shall notify
the Optionee (or any transferee thereof permitted hereunder) in writing of any
such determination and of the scope and duration of any such restriction.  If the Committee notifies an Optionee (or any
transferee thereof permitted hereunder) in detrimental activity and such
Optionee (or any transferee thereof permitted hereunder) has exercised or
attempts to exercise an Option after such notification but prior to a decision
of the Committee based on the full consideration of all 

the facts
presented on behalf of the Company and the Optionee (or any transferee thereof
permitted hereunder), the Company shall not be required to recognize such
exercise until the Committee has made its decision and, in the event any
exercise shall have taken place, it shall be of no force and effect (and void
ab initio) if the committee makes an adverse determination; provided, however,
that if the Committee finds in favor of the Optionee (or any transferee thereof
permitted hereunder), then the Optionee (or any transferee thereof permitted
hereunder) will be deemed to have exercised such Option as of the date he or
she originally gave written notice of his or her attempt to exercise or actual
exercise, as the case may be.  The
decision of the Committee as to the detrimental nature of the Optionee’s (or
any transferee’s thereof permitted hereunder) activities shall be final,
binding and conclusive.

9.             ­Designation of Beneficiary by Optionee.  The Optionee may, from time to time, name any
beneficiary or beneficiaries (who may be named contingently or successively) to
whom any benefit hereunder is to be paid in case of his death before he
receives any or all of such benefit. 
Each such designation shall revoke all prior designations by the same
Optionee, shall be in a form prescribed by the Committee, and will be effective
only when filed by the Optionee in writing with the Committee during the Optionee’s  lifetime. 
In the absence of any such designation, benefits remaining unpaid at the
Optionee’s death shall be paid to the Optionee’s estate.

10.           ­Restrictions on Exercise.  The Option may not be exercised if the
issuance of such Shares or the method of payment of the consideration for such
Shares would constitute a violation of any applicable federal or state
securities or other laws or regulations, including, without limitation, the
Act, any rule under Part 221 of Title 12 of the Code of Federal Regulations
(“Regulation U”) as promulgated by the Federal Reserve Board, or any rules or
regulations of any stock exchange on which the Common Stock may be listed.

11.           Rights
as a Stockholder.

a.             ­No
Stockholder Rights.  An Optionee of an Option (or a
permitted transferee of such Optionee) shall have no rights as a stockholder
with respect to any Shares of Common Stock until the issuance of a stock
certificate for such Shares.

b.             ­Representation
of Ownership.  In the case of the exercise of an
Option by a person or estate acquiring the right to exercise such Option by
reason of the death or Disability of an Optionee, the Committee may require
reasonable evidence as to the ownership of such Option or the authority of such
person and may require such consents and releases of taxing authorities as the
Committee may deem advisable.

12.           ­Listing and Registration of Shares of Common Stock.  The exercise of any Option granted hereunder
shall only be effective at such time as counsel to the Company shall have
determined that the issuance and delivery of the Shares of Common Stock
pursuant to such exercise is in compliance with all applicable laws,
regulations of governmental authorities and the requirements of any securities
exchange on which Shares of Common Stock are traded.  The Committee may, in its discretion, defer
the effectiveness of any exercise of an Option in order to allow the issuance
of Shares of Common Stock to be made pursuant to registration or an 

exemption from
registration or other methods for compliance available under federal or state
securities laws.  The Committee shall
inform the Optionee in writing of its decision to defer the effectiveness of
the exercise of an Option.  During the
period that the effectiveness of the exercise of an Option has been deferred,
the Optionee may, by written notice to the Committee, withdraw such exercise
and obtain the refund of any amount paid with respect thereto.

13.           ­Termination of Employment/Directorship Service.  Voluntary or involuntary termination of the
Optionee as an employee of the Company or as a member of the Company’s Board of
Directors, and the death or Disability of Optionee, shall affect Optionee’s
rights under the Option as follows:

a.             ­Termination
for Cause.  The vested and non-vested
portions of the Option shall terminate immediately and shall not be exercisable
to any extent if Optionee’s service as an employee or a member of the Company’s
Board of Directors is terminated for Cause (as defined herein at the time of
such termination).

b.             ­Other
Involuntary Termination or Voluntary Termination.  If Optionee’s service as an employee or as a
member of the Company’s Board of Directors is terminated for any reason other
than for Cause, death or Disability (as defined herein at the time of
termination), then (i) the Option will immediately terminate to the extent it
is unvested and (ii) the vested portion of the Option will terminate to the
extent not exercised within 90 calendar days after the date of such
termination.  In no event may the Option
be exercised by anyone after the earlier of (i) the expiration of the Option
Period or (ii) 90 calendar days after termination of membership on the Company’s
Board of Directors.

c.             ­Death
or Disability.  If Optionee’s
employment or membership on the Company’s Board of Directors is terminated by
death or Disability, then (i) the Option will immediately terminate to the
extent it is unvested, and  (ii) the
vested portion of the Option will terminate 365 calendar days after the date of
such termination to the extent not exercised by Optionee or, in the case of
death, by the person or persons to whom Optionee’s rights under the Option have
passed by will or by the laws of descent and distribution or, in the case of
Disability, by Optionee’s legal representative. 
In no event may the Option be exercised by anyone after the earlier of
(i) the expiration of the Option Period, or (ii) 365 days after Optionee’s
death or termination of employment or membership on the Company’s Board of
Directors, due to Disability.

14.           ­Independent Legal and Tax Advice.  Optionee acknowledges that the Company has
advised Optionee to obtain independent legal and tax advice regarding the grant
and exercise of the Option and the disposition of any Shares acquired thereby.

15.           ­Corporate Powers. 
The existence of the Option shall not affect in any way the right or
power of the Company or its stockholders to make or authorize any or all
adjustments, recapitalizations, reorganizations or other changes in the Company’s
capital structure or its business, or any merger or consolidation of the
Company, or any issue of bonds, debentures, preferred or prior preference stock
ahead of or affecting the Shares or the rights thereof, or the dissolution or
liquidation of the Company, or any sale or transfer of all or any part of its
assets or 

business, or any other
corporate act or proceeding, whether of a similar character or otherwise.  In the event of a “Change in Control” of the
Company (as defined herein at the time of such event), vesting of the Option
will be accelerated and the Option shall otherwise be affected as set forth
herein.

16.           Change in Stock and
Adjustments.

a.             ­Changes
in Law or Circumstances.  Subject to Section
17 (which only applies in the event of a Change in Control), in the event
of any change in applicable laws or any change in circumstances which results
in or would result in any dilution of the rights granted hereunder, then, if
the Committee should determine, in its absolute discretion, that such change
equitably requires an adjustment in the number or kind of shares of stock or
other securities or property theretofore subject, or which may become subject,
to issuance or transfer hereunder, such adjustment shall be made in accordance
with such determination.  Such
adjustments may include changes with respect to the price per share for
outstanding Options.  Any adjustment
under this paragraph of an outstanding Option shall be made only to the extent
not constituting a “modification” within the meaning of Section 424(h)(3) of
the Code unless otherwise agreed to by the Optionee in writing.  The Committee shall give notice to each
applicable Optionee of such adjustment which shall be effective and binding.

b.             ­Recapitalization
of the Company.  Subject to Section
17, if while there are Options outstanding hereunder, the Company shall
effect any subdivision or consolidation of shares of Common Stock or other
capital readjustment, the payment of a stock dividend, stock split, combination
of shares of Common Stock, recapitalization or other increase or reduction in
the number of shares of Common Stock outstanding, without receiving
compensation therefor in money, services or property, then the number of
Options which may thereafter be exercised shall (i) in the event of an increase
in the number of shares of Common Stock outstanding, be proportionately
increased and the Option Price of the Options awarded shall be proportionately
reduced; and (ii) in the event of a reduction in the number of shares of Common
Stock outstanding, be proportionately reduced, and the Option Price of the
Options awarded shall be proportionately increased.  The Committee shall take such action and
whatever other action it deems appropriate, in its discretion, so that the
value of each outstanding Option to the Optionee shall not be adversely
affected by a corporate event described in this subsection 16(c).

c.             ­Reorganization
of the Company.  Subject to Section
17, if the Company is reorganized, merged or consolidated, or is a party to
a plan of exchange with another corporation, pursuant to which reorganization,
merger, consolidation or exchange, stockholders of the Company receive any
shares of Common Stock or other securities or property, or if the Company
should distribute securities of another corporation to its stockholders, each
Optionee shall be entitled to receive, in lieu of the number of unexercised
Options previously awarded, the number of Stock Options with a corresponding
adjustment to the Option Price of said Options, to which he would have been
entitled if, immediately prior to such corporate action, such Optionee had been
the 

holder of
record of a number of shares of Common Stock equal to the number of the
outstanding Options payable in shares of Common Stock that were previously
awarded to him.  In this regard, the
Committee shall take whatever other action it deems appropriate to preserve the
rights of Optionees holding outstanding Options.

d.             ­Issue
of Common Stock by the Company. 
Except as hereinabove expressly provided in this Section 16 and
subject to Section 17, the issue by the Company of shares of stock of
any class, or securities convertible into shares of stock of any class, for
cash or property, or for labor or services, either upon direct sale or upon the
exercise of rights or warrants to subscribe therefor, or upon any conversion of
shares or obligations of the Company convertible into such shares or other
securities, shall not affect, and no adjustment by reason thereof shall be made
with respect to, the number of, or Option Price of, any Options then
outstanding under previously granted Options.

e.             ­Acquisition
of the Company.  Subject to Section
17, in the case of any sale of assets, merger, consolidation or combination
of the Company with or into another corporation other than a transaction in which
the Company is the continuing or surviving corporation and which does not
result in the outstanding shares of Common Stock being converted into or
exchanged for different securities, cash or other property, or any combination
thereof (an “Acquisition”), in the absolute discretion of the Committee, any
Optionee who holds an outstanding Option shall have the right (subject to any
limitation applicable to the Option) thereafter and during the term of the
Option, to receive upon exercise thereof the Acquisition Consideration (as
defined below) receivable upon the Acquisition by a holder of the number of
shares of Common Stock which would have been obtained upon exercise of the
Option immediately prior to the Acquisition. 
The term “Acquisition Consideration” shall mean the kind and amount of
shares of the surviving or new corporation, cash, securities, evidence of
indebtedness, other property or any combination thereof receivable in respect
of one share of Common Stock upon consummation of an Acquisition.  The Committee, in its discretion, shall have
the authority to take whatever action it deems appropriate to effectuate the
provisions of this subsection 16(f).

f.              ­Assumption
of Options by a Successor.  In the
event of a dissolution or liquidation of the Company, a sale of all or
substantially all of the Company’s assets, a merger or consolidation involving
the Company in which the Company is not the surviving corporation, or a merger
or consolidation involving the Company in which the Company is the surviving corporation
but the holders of shares of the Common Stock receive securities of another
corporation and/or other property, including cash, the Committee shall, in its
absolute discretion, have the right and power to:

(i)            cancel,
effective immediately prior to the occurrence of such corporate event, each
outstanding Option (whether or not then exercisable), and, in full
consideration of such cancellation, pay to the Optionee to whom such Option was
granted an amount in cash equal to the excess of (A) the value, as determined
by the Committee, in its absolute discretion, of the property (including 

cash) received
by the holder of a share of Common Stock as a result of such event over (B) the
exercise price of such Option, if any; or

(ii)           provide for the exchange
of each Option outstanding immediately prior to such corporate event (whether
or not then exercisable) for an incentive award on some or all of the property
for which such Option is exchanged and, incident thereto, make an equitable
adjustment as determined by the Committee, in its absolute discretion, in the
exercise price of the incentive award, if any, or the number of shares or
amount of property (including cash) subject to the incentive award or, if
appropriate, provide for a cash payment to the Optionee to whom such Option was
granted in consideration for the exchange of the Option.

The Committee, in its discretion, shall have the
authority to take whatever action it deems appropriate to effectuate the
provisions of this subsection 16(g).

17.           ­Change in Control. 
Notwithstanding any contrary provision herein, in the event of a Change
in Control (as defined below), the following actions shall automatically occur
as of the day immediately preceding the Change in Control date, all of the
Options then outstanding shall become 100% vested and immediately and fully
exercisable.  Notwithstanding any other
provision hereof,  the provisions of this
Section 17 may not be terminated, amended, or modified to adversely
affect any Option theretofore granted without the prior written consent of the
Optionee with respect to his outstanding Options subject, however, to the last
paragraph of this Section 17.

For
all purposes of this Agreement, a “Change in Control” of the Company shall be
deemed to have occurred:

a.             If
any person (as defined in Section 3(a) (9) of the Exchange Act (or any
successor provision), other than the Company, becomes the beneficial owner
directly or indirectly of more than twenty-five percent (25%) of the
outstanding Common Stock of the Company, determined in accordance with Rule
13d-3 under the Exchange Act (or any successor provisions), or otherwise
becomes entitled to vote more than twenty-five percent (25%) of the voting
power entitled to be cast at elections for directors (“Voting Power”) of the
Company, or in any event such lower percentage as may at any time be provided
for in any similar provision for any director or officer of the Company or of
any Subsidiary approved by the Board;

b.             If
the Company is subject to the reporting requirements of Section 13 or 15(d) (or
any successor provision) of the Exchange Act, and any person (as defined in
Section 3 (a) (9) of the Exchange Act), other than the Company, purchases
shares pursuant to a tender offer or exchange offer to acquire Common Stock of
the Company (or securities convertible into or exchangeable for or exercisable
person in question is the beneficial owner, directly or indirectly, of more
than twenty-five percent (25%) of the outstanding Common Stock of the Company,
determined in accordance with Rule 13-3 under the Exchange Act (or any
successor provision) or such lower percentages as may at 

any time be
provided for in any similar provision for any director or officer of the
Company or of any Subsidiary approved by the Board;

c.             If
the stockholders or the Board approve any consolidation or merger of the
Company in which the Company is not the continuing or surviving corporation
unless such merger is with a Subsidiary at least eighty percent (80%) of the
voting power of which is held by the Company or pursuant to which the holders
of the Company’s shares of Common Stock immediately prior to such merger or
consolidation would not be the holders immediately after such merger or
consolidation of at least a majority of the voting power of the Company or such
lower percentage as may at any time be provided for in any similar provision
for any director or officer of the Company or of any Subsidiary approved by the
Board.  The stockholders or the Board
shall have approved any sale, lease, exchange or other transfer (in one
transaction or a series of transactions) of all or substantially all of the
assets of the Company; or upon the election of one or more new directors of the
company, a majority of the directors holding office, including the newly
elected directors, were not nominated as candidates by a majority of the
directors in the office immediately before such election.

As used in the definition
of “change of control”, “Common Stock” means the Common Stock, or if changed,
the capital stock of the Company as it shall be constituted from time to time
entitling the holders thereof to share generally in the distribution of all
assets available for distribution to the Company’s stockholders after the
distribution to any holders of capital stock with preferential rights.

Notwithstanding the
occurrence of any of the foregoing events of this Section 17 which would
otherwise result in a Change in Control, the Board may determine in its
discretion, if it deems it to be in the best interest of the Company, that an
event or events otherwise constituting a Change in Control shall not be
considered a occurrence of an event that otherwise would be or probably would
lead to a Change in Control; or after such event if made by the Board a
majority of which is composed of directors who were members of the Board
immediately prior to the event that otherwise would be or probably would lead
to a Change in Control.

18.           ­No Rights in Shares. 
Optionee shall have no rights as a stockholder in respect of the Shares
until the Optionee becomes the record holder of such Shares.

19.           ­Investment Representation.  Optionee will enter into such written
representations, warranties and agreements as the Company may reasonably
request in order to comply with any federal or state securities law.  Moreover, any stock certificate for any
Shares issued to Optionee hereunder may contain a legend restricting their
transferability as determined by the Company in its discretion.  Optionee agrees that the Company shall not be
obligated to take any affirmative action in order to cause the issuance or
transfer of Shares hereunder to comply with any law, rule or regulation that
applies to the Shares subject to the Option.

20.           ­Securities Requirements.  The Company shall be under no obligation to effect
the registration pursuant to the Securities Act of 1933, as amended, of any
Shares of Common Stock 

to be issued
hereunder or to effect similar compliance under any state laws.  Notwithstanding anything herein to the
contrary, the Company shall not be obligated to cause to be issued or delivered
any certificates evidencing Shares unless and until the Company is advised by
its counsel that the issuance and delivery of such certificates is in
compliance with all applicable laws, regulations of governmental authorities,
and the requirements of any securities exchange on which Shares are
traded.  The Committee may require, as a
condition of the issuance and delivery of certificates evidencing the Shares
pursuant to the terms hereof, that the recipient of such Shares make such
covenants, agreements and representations, and that such certificates bear such
legends, as the Committee, in its discretion, deems necessary or desirable.

OPTIONEE UNDERSTANDS AND AGREES
THAT, IF AT THE TIME OF ANY PURPORTED EXERCISE OF THE OPTION, SUCH EXERCISE IS
NOT REGISTERED UNDER THE ACT, THE COMPANY MAY REQUIRE AS A PRECONDITION TO SUCH
ISSUANCE THAT OPTIONEE BE AN “ACCREDITED INVESTOR”, AS SUCH TERM IS USED IN
REGULATION D UNDER THE ACT, AND THAT OPTIONEE MAY NOT BE ABLE TO SATISFY SUCH
CONDITION.

The
Company may imprint on the certificate for such Shares the following legend or
any other legend which counsel for the Company considers necessary or advisable
to comply with the Securities Act of 1933:

THE SHARES OF STOCK
REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933 OR UNDER THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE SOLD OR
TRANSFERRED EXCEPT UPON SUCH REGISTRATION OR UPON RECEIPT BY THE CORPORATION OF
AN OPINION OF COUNSEL SATISFACTORY TO THE CORPORATION, IN FORM AND SUBSTANCE
SATISFACTORY TO THE CORPORATION, THAT REGISTRATION IS NOT REQUIRED FOR SUCH
SALE OR TRANSFER.

21.           No
Guarantee of Employment or Directorship. 
The Option shall not confer upon Optionee any right to continued employment
or membership on the Company’s Board of Directors, nor shall it interfere with
any right the Board of Directors or Stockholders would otherwise have to
terminate Optionee’s membership on the Board of Directors at any time, with or
without cause.

22.           Withholding
of Taxes.  The Company shall have the
right to (a) make deductions from the number of Shares otherwise deliverable
upon exercise of the Option in an amount sufficient to satisfy withholding of
any federal, state or local taxes required by law, or (b) take such other
action as may be necessary or appropriate to satisfy any such tax withholding
obligations, including without limitation by requiring Optionee to remit to the
Company an amount in cash sufficient to satisfy federal, state and local taxes,
domestic or foreign, required by law or regulation to be withheld with respect
to any taxable event arising as a result of the exercise of the Option.

23.           Requirements
of Law.  The granting of Options and
the issuance of Shares hereunder shall be subject to all applicable laws,
rules, and regulations, and to such approvals by any governmental agencies or
national securities exchanges as may be required.  Certificates evidencing shares of Common
Stock delivered under this Agreement (to the extent that such shares are so
evidenced) may be subject to such stop transfer orders and other restrictions
as the Committee may deem advisable under the rules and regulations of the
Securities and Exchange Commission, any securities exchange or transaction reporting
system upon which the Common Stock is then listed or to which it is admitted
for quotation, and any applicable federal or state securities law.  The Committee may cause a legend or legends
to be placed upon such certificates (if any) to make appropriate reference to
such restrictions.

24.           Rule
16b-3 Securities Law Compliance. 
With respect to Insiders, transactions hereunder are intended to comply
with all applicable conditions of Rule 16b-3 under the Exchange Act.  Any ambiguities or inconsistencies in the
construction of an Option shall be interpreted to give effect to such
intention.  However, to the extent any
action by the Committee fails to so comply, it shall be deemed null and void to
the extent permitted by law and deemed advisable by the Committee in its
discretion.

25.           Grant Terms.  The following capitalized terms shall have
those meanings set forth opposite them:

a.             ­Optionee:                                 

b.             ­Grant Date:                          ,200   

c.             ­Shares:                  
(             )

d.             ­Option Price:                 Dollars
(             )
per Share.

e.             ­Option Period:                  (        )
years.

f.              ­Vesting Schedule:
The Shares subject to this Option shall vest as follows:

	
  Date

  	
   

  	
  Options Vesting

  
	
                         ,
  2001

  	
   

  	
   

  
	
                         ,
  2002

  	
   

  	
   

  
	
                         ,
  2003

  	
   

  	
   

  
	
   

  	
  Total

  	
   

  	
   

  	
   

  	
   

  
						

 

26.           Employment
Agreement Governs. In the event that, on any relevant date, there is in
effect an Employment Agreement which purports to supersede or govern any term
or provision of the Option, then such term or provision of the Option shall be
superseded or 

governed (as the
case may be) by the applicable terms and provisions of such Employment
Agreement, including without limitation any applicable definitions contained
therein.

27.           Authority
of Committee. Except as may be limited by law and subject to the provisions
herein, the Committee shall have full power to construe and interpret the
Option. All determinations and decisions made by the Committee shall be made in
its discretion pursuant to the provisions hereof, and shall be final,
conclusive and binding on all persons, including the Company, its shareholders,
Optionee and their estates and beneficiaries.

28.           General.

a.             Notices.  All notices under this Agreement shall be
mailed or delivered by hand to the parties at their respective addresses set
forth beneath their signatures below or at such other address as may be
designated in writing by either of the parties to one another.  Notices shall be effective upon receipt.

b.             ­Amendment
and Termination.  No amendment,
modification or termination of the Option or this Agreement shall be made at
any time without the written consent of Optionee and the Company.

c.             ­No
Guarantee of Tax Consequences.  The
Company and the Committee  make no
commitment or guarantee that any federal or state tax treatment will apply or
be available to any person eligible for benefits under the Option.  The Optionee has been advised and been provided
the opportunity to obtain independent legal and tax advice regarding the grant
and exercise of the Option and the disposition of any Shares acquired thereby.

d.             ­Severability.  In the event that any provision of this
Agreement shall be held illegal, invalid, or unenforceable for any reason, such
provision shall be fully severable, but shall not affect the remaining
provisions of the Agreement, and the Agreement shall be construed and enforced
as if the illegal, invalid, or unenforceable provision had not been included
herein.

e.             ­Successors.  All obligations of the Company hereunder with
respect to Options granted hereunder shall be binding on any successor to the
Company, whether the existence of such successor is the result of a direct or
indirect purchase, merger, consolidation, or otherwise, of all or substantially
all of the business and/or assets of the Company.

f.              ­Gender,
Tense and Headings.  Whenever the
context so requires, words of the masculine gender used herein shall include
the feminine and neuter, and words used in the singular shall include the
plural.  Section headings as used herein
are inserted solely for convenience and reference and constitute no part of the
interpretation or construction of the Agreement.

g.             ­Supersedes
Prior Agreements.  This Agreement
shall supersede and replace all prior agreements and understandings, oral or
written, between the Company and the Optionee regarding the grant of the
Options covered hereby.

h.             ­Governing
Law.  The Option, and all matters
relating thereto, shall be governed by, and construed in accordance with, the
domestic substantive laws of the State of Maryland without regard to any choice
or conflicts of law principles which would cause the application of the
domestic substantive laws of any other jurisdiction,  to the extent federal law does not supersede
and preempt Maryland law.

[SIGNATURE PAGE FOLLOWS]

IN WITNESS WHEREOF, the Company
has, effective as of the Grant Date, caused this Agreement to be executed on
its behalf by its duly authorized officer, and Optionee has hereunto set his
hand as of the same date, which date is the date of grant of this Option.

	
  

  	
  KEY
  ENERGY SERVICES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address for
  Notices:

  
	
   

  
	
   

  	
  Key Energy
  Services, Inc.

  
	
   

  	
  1301 McKinney
  Street, Suite 1800

  
	
   

  	
  Houston, Texas
  77010

  
	
   

  	
  Attention:
  General Counsel

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  OPTIONEE

  
	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
  Address:Exhibit 10.1

SUBSCRIPTION
AGREEMENT

PRIVATE
PLACEMENT OF SERIES C PREFERRED STOCK AND WARRANTS

OF

XPLORE TECHNOLOGIES CORP.

	
  Subscriber:                                    

  	
   

  	
   

  	
  Amount
  of Subscription $                              

  
	
   

  	
   

  	
  (Purchase
  Price)

  

 

Xplore Technologies Corp.

14000 Summit Drive, Suite 900

Austin, Texas 78728

Attn: Michael J. Rapisand

Gentlemen:

1.              SUBSCRIPTION

a.               The
undersigned (sometimes referred to herein as “Purchaser”), intending to be legally bound,
irrevocably subscribes for and agrees to purchase               
Units, each consisting of one share of Series C Convertible Preferred Stock,
$.001 par value per share (the “Series C
Preferred”), and one warrant to purchase one-half of one share
of common stock (the “Warrants”
and together with the Series C Preferred, the “Securities” or the “Units”) of Xplore Technologies Corp., a Delaware
corporation (the “Company”),
at  the purchase price of $0.50 per Unit (the “Purchase Price”), offered by the Company (the
“Offering”) on the
terms and conditions described that certain Confidential Private Placement
Memorandum dated July 3, 2007 (the “Memorandum”).
The undersigned herewith delivers to the Company the Purchase Price required to
purchase the Securities subscribed for hereunder by delivery to the Company of
a check or certified funds in the amount of the Purchase Price. The minimum
investment is $100,000 unless otherwise determined in the sole discretion of
the Company.

2.              ACCREDITED INVESTOR
REPRESENTATIONS

a.               In
order to ensure that the Securities are sold pursuant to an appropriate
exemption from registration under the Securities Act of 1933, as amended (the “Securities Act”),
and in accordance with Regulation D promulgated thereunder (“Regulation D”),
the undersigned represents and warrants that the undersigned is an accredited
investor described within one of the following categories:

i.                           A
bank as defined in Section 3(a)(2) of the Securities Act, or any savings and
loan association or other institution as defined in Section 3(a)(5)(A) of the
Securities Act whether acting in its individual or fiduciary capacity; any
broker or dealer registered pursuant to Section 15 of the Securities Exchange
Act of 1934, as amended (the “Exchange Act”); any insurance company as defined in
Section 2(a)(13) of the Securities Act; any investment company registered under
the Investment Company Act of 1940 or a business development company as defined

in Section
2(a)(48) of that Act; any Small Business Investment Company licensed by the U.S.
Small Business Administration under Section 301(c) or (d) of the Small Business
Investment Act of 1958; any plan established and maintained by a state, its
political subdivisions, or any agency or instrumentality of a state or its
political subdivisions, for the benefit of its employees, if such plan has
total assets in excess of $5,000,000; any employee benefit plan within the
meaning of the Employee Retirement Income Security Act of 1974 (“ERISA”) if the
investment decision is made by a plan fiduciary, as defined in Section 3(21) of
ERISA, which is either a bank, savings and loan association, insurance company,
or registered investment adviser, or if the employee benefit plan has total
assets in excess of $5,000,000 or, if a self-directed plan, with investment
decisions made solely by persons that are accredited investors;

ii.                        A
private business development company as defined in Section 202(a)(22) of the
Investment Advisers Act of 1940;

iii.                     An
organization described in Section 501(c)(3) of the Internal Revenue Code,
corporation, Massachusetts or similar business trust, or partnership, not
formed for the specific purpose of acquiring the Securities, with total assets
in excess of $5,000,000;

iv.                    A
director or executive officer of the Company;

v.                       A
natural person whose individual net worth, or joint net worth with that person’s
spouse at the time of the purchase of the Securities, exceeds $1,000,000;

vi.                    A
natural person who had an individual income (exclusive of any income earned by
their spouse) in excess of $200,000 in each of the two most recent years or
joint income with that person’s spouse in excess of $300,000 in each of the two
most recent years and has a reasonable expectation of reaching the same income
level in the current year;

vii.                 A
trust, with total assets in excess of $5,000,000, not formed for the specific
purpose of acquiring the Securities, whose purchase is directed by a
sophisticated person as described in Rule 505(b)(2)(ii) of Regulation D; or

viii.              An
entity in which all of the equity owners are accredited investors.

b.              The
undersigned certifies that this representation is true and correct and hereby
agrees to notify the Company of any change which occurs in such information
prior to the Company’s acceptance of this subscription.

3.              GENERAL
REPRESENTATIONS AND WARRANTIES

The undersigned hereby acknowledges, represents and
warrants to and agrees with the Company, with full knowledge that the Company
intends to rely hereon, as follows:

(a)           The undersigned is acquiring the Securities
for the undersigned’s own account as principal, for investment purposes only,
and not with a view to, or for, resale or distribution of all or any part of
the Securities, and no other person has a direct or indirect beneficial
interest in such Securities.

 2
 

(b)           The undersigned acknowledges its
understanding that the Securities are being offered and sold without
registration under the Securities Act or the securities laws of any state, in
reliance upon the exemptions from the registration provisions of the Securities
Act and the regulations thereunder afforded by Section 4(2) of the Securities
Act and Regulation D promulgated thereunder, and that such reliance is
predicated in part on the undersigned’s representations and warranties set
forth in this Subscription Agreement.

(c)           The undersigned will not sell or otherwise
transfer the Securities without registration under the Securities Act, or
satisfying an exemption therefrom and fully understands and agrees that the
undersigned must bear the economic risk of the undersigned’s purchase of the
Securities for an indefinite period of time.

(d)           The undersigned agrees to the placement of
the following legend on any certificate representing the Securities:

THESE SECURITIES HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), OR ANY APPLICABLE STATE SECURITIES LAWS AND, ACCORDINGLY, MAY NOT BE
OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND IN COMPLIANCE WITH ALL APPLICABLE STATE
SECURITIES LAWS.

(e)           The undersigned has the financial ability to
bear the economic risk of the investment by the undersigned in the Securities,
has adequate means for providing for the undersigned’s current needs and
contingencies and has no need for liquidity with respect to the undersigned’s
investment in the Securities.

(f)            If the undersigned is:

i.                  an individual, the undersigned is at
least 21 years of age, and a bona fide resident of the state set forth on the
signature page hereof, the address set forth is the undersigned’s true and
correct residence address; and the undersigned is legally empowered to enter
into binding contracts pursuant to the laws of such state; or

ii.               a corporation, limited liability
company, partnership, trust, qualified plan or other entity, it is formed and
validly subsisting under the laws of its jurisdiction of formation, it is
authorized and qualified to become a holder of Securities, it has not been
formed for the sole purpose of acquiring the Securities, and the person signing
this Subscription Agreement on its behalf has been duly authorized to do so.

(g)           Any information which the undersigned has
heretofore furnished and herewith furnishes to the Company with respect to the
undersigned’s financial position and business experience is correct and
complete as of the date of this Subscription Agreement and if there should be
any material change in such information prior to issuance to the undersigned of
Securities, the undersigned will immediately furnish such revised or corrected
information to the Company.

 3
 

(h)           The undersigned acknowledges that the
undersigned has not purchased the Securities as a result of any general
solicitation or general advertising.

(i)            The undersigned’s overall commitment to
investments which are not readily marketable is not disproportionate to the
undersigned’s net worth, and the undersigned’s prospective investment in the
Company will not cause such overall commitment to become excessive.

(j)            Nothing contained herein should be
construed as tax advice to the undersigned; and the undersigned represents and
warrants that the undersigned has secured independent tax advice related to its
purchase of the Securities and the underlying securities of the Company; that
the Securities are speculative investments which involve a high degree of risk,
including, without limitation, the risk of loss of the undersigned’s entire
investment; and that no governmental agency has made any finding or
determination as to the fairness of the investment, nor any recommendation or
endorsement of the Securities.

(k)           The entering into of this Subscription
Agreement and the transactions contemplated hereby will not result in the
violation of any of the terms and provisions of any law applicable to, or the
constating documents of, the undersigned or of any agreement, written or oral,
to which the undersigned may be a party or by which the undersigned is bound.

(l)            The undersigned:

i.                  has
been furnished with, has carefully read and understands the Memorandum and this
Subscription Agreement, and has relied solely on the information included
therein and herein;

ii.               has
been given the opportunity to ask questions of and receive answers from the
Company concerning the terms and conditions of the Offering, and has been given
the opportunity to obtain such additional information necessary for the
undersigned to evaluate the merits and risks of investment in the Securities to
the extent that the Company possesses such information or can acquire it
without unreasonable effort or expense and such information has not been
furnished with any other offering literature except as referred to herein;

iii.            has
not relied on any oral representation, warranty or information in connection
with the Offering from the Company, or any officer, employee, agent,
representative or affiliate of the Company;

iv.           has
determined the Securities are a suitable investment for the undersigned and
that at this time the undersigned can bear a complete loss of the undersigned’s
entire investment therein;

v.              must
bear the substantial economic risks of the investment in the Securities
indefinitely because the Securities may not be sold or otherwise disposed of
unless registered under the Securities Act and applicable state securities laws
or an exemption from such registration is available; and

vi.           has
such knowledge and experience in financial and business matters that the
undersigned is capable of evaluating the merits and risks of the undersigned’s
investment in the Securities.

 4
 

(m)          To the extent that the undersigned has not
sought specific information regarding the Company, the Offering or the
Securities, the undersigned represents that it had no interest in doing so and
that such matters are not material to the undersigned in connection with an
investment in the Securities.

(n)           The undersigned agrees to notify the Company
upon the occurrence of any event which would cause any of the undersigned’s
foregoing representations or warranties to be false or incorrect.

(o)           The undersigned acknowledges and agrees that
the foregoing acknowledgments, representations, warranties and agreements shall
survive the closing at which the Securities are issued.

4.              SUBSCRIPTION
IRREVOCABLE BY SUBSCRIBER BUT SUBJECT TO ACCEPTANCE OR REJECTION BY THE COMPANY

a.               This
Subscription Agreement is not, and shall not be, revocable by the Purchaser.
The Purchaser intends to be legally bound by this Subscription Agreement.

b.              The
Company, in its sole discretion, has the right to accept or reject this
subscription, in whole or in part, for any reason whatsoever. If this
subscription is rejected in whole or the Offering is terminated, all funds
received from the Purchaser will be returned without interest, expense or deduction,
and this Subscription Agreement shall thereafter be of no further force or
effect.  If this subscription is rejected
in part, the funds for the rejected portion of this subscription will be
returned without interest, expense or deduction, and this Subscription
Agreement will continue in full force and effect to the extent this
subscription was accepted.

5.              DEPOSIT OF FUNDS

When accepted and upon closing of the Offering, the
amounts of all subscriptions will be immediately available for use by the Company.
Until the closing of the Offering, the Company may invest the amounts of
subscriptions in short term investment grade securities.

6.              BLUE SKY
QUALIFICATION

The purchase of Securities under this Subscription
Agreement is expressly conditioned upon the exemption from qualification of the
offer and sale of the Securities under applicable Federal and state securities
laws. The Company shall not be required to qualify this transaction under the
securities laws of any jurisdiction and, should qualification be necessary, the
Company shall be released from any and all obligations to maintain its offer,
and may rescind any sale contracted, in such jurisdiction.

7.              AGREEMENT TO
INDEMNIFY AND HOLD HARMLESS

The undersigned agrees to indemnify and hold harmless
the Company, its affiliates and their respective directors, officers,
employees, agents, members, controlling persons and representatives (the
Company and each such person, an “Indemnified Party,” and collectively, the “Indemnified Parties”),
from and against any and all losses, claims, damages, liabilities and expenses
whatsoever (including, but not limited to, any and all expenses whatsoever
reasonably incurred investigating, preparing or defending against any
litigation commenced or threatened or any claim whatsoever), joint or several,
as incurred, to which any such Indemnified Parties may

 5
 

become subject under any applicable United States
federal or state law or the laws of any other domestic or foreign jurisdiction,
or otherwise, and related to or arising out of or based upon any false
representation, warranty or acknowledgment, or breach or failure by the
undersigned to comply with any covenant or agreement made by the undersigned
herein or in any other document furnished by the undersigned to any of the foregoing
in connection with the Offering and the transactions contemplated thereby.

8.              GOVERNING LAW, ETC.

This Subscription Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York applicable to
agreements made and to be performed wholly within such State, without giving
effect to conflicts of law principles. This Subscription Agreement may be
executed in two or more counterparts, each of which will constitute an
original, but all of which, when taken together, will constitute but one
instrument. All captions and section headings are for convenience only. All
pronouns and any variations thereof shall be deemed to refer to the masculine,
feminine, neuter, singular or plural, as the identity of the person or persons or
entity or entities may require. This Subscription Agreement is not transferable
or assignable by the Purchaser. If the Purchaser is more than one person, the
obligations of the Purchaser shall be joint and several and the
representations, warranties and agreements herein contained shall be deemed to
be made by and be binding upon each such person and each such person’s heirs,
executors, administrators and successors and assigns.

[Certification
Page Follows]

 6
 

ACCREDITED
INVESTOR CERTIFICATION

(Please initial one of the following  statements)

A.                                   Individual
Investors.  The undersigned hereby certifies that he or she is an
accredited investor because he or she:

1.                                                   had
individual income (exclusive of any income earned by their spouse) of more than
$200,000 in each of the most recent two years and reasonably expects to have an
individual income in excess of $200,000 for the current year.

2.                                                   had
joint income with their spouse in excess of $300,000 in each of the most recent
two years and reasonably expect to have joint income with their spouse in
excess of $300,000 for the current year.

3.                                                   has
an individual net worth, or with their spouse has a joint net worth, in excess
of $1,000,000.

4.                                                   is
a director or executive officer of the Company.

B.                                     Partnerships,
corporations, trusts or other entities. 
The undersigned hereby certifies that
it is an accredited investor because it is:

1.                                                   an
“employee benefit plan” (within the meaning of ERISA) with total assets in
excess of $5,000,000.

2.                                                   an
“employee benefit plan” (within the meaning of ERISA) whose investment
decisions are made by a plan fiduciary (as defined in Section 3(21) of ERISA)
which is either a bank, savings and loan association, insurance company or
registered investment adviser.

3.                                                   a
self-directed “employee benefit plan” (within the meaning of ERISA) whose
investment decisions are made solely by persons that are accredited investors.

4.                                                   an
organization described in Section 501(c)(3) of the Internal Revenue Code of
1986, not formed for the specific purpose of acquiring the Securities, with
total assets in excess of $5,000,000.

5.                                                   a
corporation, partnership or Massachusetts or similar business trust, not formed
for the specific purpose of acquiring the Securities, with total assets in
excess of $5,000,000.

6.                                                   a
trust, not formed for the specific purpose of acquiring the Securities, with
total assets in excess of $5,000,000, whose purchase is directed by a person
who has such knowledge and experience in financial and business matters that he
is capable of evaluating the merits and risks of an investment in the
Securities.

7.                                                   a
bank (as defined under Section 3(a)(2) of the Securities Act) or a savings and
loan association or other institution (as defined in Section 3(a)(5)(A) of the
Securities Act) whether acting in its individual or fiduciary capacity.

8.                                                   a
broker dealer registered pursuant to Section 15 of the Exchange Act.

9.                                                   an
insurance company (as defined in Section 2(a)(13) of the Securities Act).

 7
 

10.                                             an
investment company registered under the Investment Company Act of 1940, or a
business development company as defined in Section 2(a)(48) that Act.

11.                                             a
Small Business Investment Company licensed by the U.S. Small Business
Administration under Section 301(c) or (d) of the Small Business Investment Act
of 1958.

12.                                             a
plan established and maintained by a state, its political subdivisions, or any
agency or instrumentality of a state or its political subdivisions, for the
benefit of its employees, with total assets in excess of $5,000,000.

13.                                             a
private business development company (as defined in Section 202(a)(22) of the
Investment Advisers Act of 1940).

14.                                             an
entity in which all of the equity owners are accredited investors.

 8
 

SUBSCRIPTION
SIGNATURE PAGE

Private
Placement of Series C Convertible Preferred Stock and Warrants

of

Xplore
Technologies Corp.

The undersigned, desiring to purchase shares of Series
C Convertible Preferred Stock and Warrants of the Company pursuant to the terms
of the Memorandum and this Subscription Agreement, hereby agrees to all the
terms of this Subscription Agreement and, upon acceptance of the Subscription
Agreement by the Company, agrees to be bound by the terms and provisions
thereof.

By executing this Subscription Signature Page, the
undersigned hereby:

A.                                   executes,
adopts and agrees to all terms, conditions and representations of this
Subscription Agreement, and

B.                                     subscribes
for                     
Units, at a purchase price of $0.50 per Unit, each Unit consisting of one share
of Series C Convertible Preferred Stock and one Warrant to purchase one-half of
one share of common stock of the Company at an exercise price of $0.50 per
share.

If the Purchaser is an
INDIVIDUAL, and if purchased as JOINT TENANTS, as TENANTS IN COMMON, or as
COMMUNITY PROPERTY:

	
  

  	
   

  	
   

  	
   

  
	
  Print Name

  	
   

  	
  Print Name

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Signature of Purchaser

  	
   

  	
  Signature of Purchaser

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Social Security Number

  	
   

  	
  Social Security Number

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Date

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (Address)

  	
   

  	
   

  	
   

  

 

 9
 

If the Purchaser is a
PARTNERSHIP, CORPORATION, TRUST, LIMITED LIABILITY PARTNERSHIP or LIMITED
LIABILITY COMPANY:

	
  

  	
   

  	
   

  	
   

  	
   

  
	
  Name of Partnership, Corporation,

  Trust, LLP or LLC

  	
   

  	
  Federal Taxpayer

  Identification Number

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Name: 

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Date

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  (Address)

  	
   

  	
   

  
							

 

ACCEPTED AND AGREED TO:

this
         day of                     ,
2007

	
  XPLORE TECHNOLOGIES CORP.

  
	
   

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Michael J. Rapisand

  
	
   

  	
  Chief Financial Officer

  

 

 10

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00129-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00129-of-00352.parquet"}]]