|Table of Contents**U.S. SECURITIES AND EXCHANGE COMMISSION**

		

		Washington, D.C. 20549

		FORM 10-KSB
|---------------------------------------------------------------------------------------------------------

|(Mark One)
|----------
|[ ]       
|[X]       

|**Commission file number 0-27845****TRANSAX INTERNATIONAL LIMITED**
			-----------------------------------------------------------------------------------
			(Exact name of small business issuer as specified in its charter)                                                                                                                                                                                                                                                                                                                                                                                                                                
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|**COLORADO**
		------------------------
		(State or other jurisdiction ofincorporation of organization)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|**7545 Irvine Center Drive, Suite 200
		Irvine, CA, 92618**
		--------------------------------------------
		(Address of Principal Executive Offices)**(949) 623-8316**
		-------------------------
		(Issuer's telephone number)**N/A**
		-------------------------
		(Former name, former address and former fiscal year, if changed since last report)

		Securities registered pursuant to Section 12(b) of the Exchange Act:**None**
		-------------------------
		(Title of class)
		Securities registered pursuant to Section 12(g) of the Exchange Act :**Common Stock, Par Value $0.001**
		---------------------------------------
		(Title of class)

---

|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 | ----
|--- | --------- | -- | ----

|Check here if there is no disclosure of delinquent filers in response to Item 405 of Regulation S-B contained in this Form, and no disclosure will be contained, to the best of Registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-KSB or any amendment to this Form 10-KSB. [X]

State the issuer's revenues for its more recent fiscal year ended December 31, 2003: $309,589.

State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was sold, or the average bid and asked prices of such common equity, as of January 29, 2004: $786,895.

State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date:
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Class
			-------------------  | Outstanding as of March 31, 2004
			----------------------------------------------
|----------------------------- | ----------------------------------------------------------------------------------
|Common Stock, $.001 par value | 15,303,217                                                                        

---

|**TABLE OF CONTENTS**
	Back to 10-KSB Title Page

PART IITEM 1 : Description of BusinessBusiness History and Development
		Current Business Operations
		Employees
		Risk Factors
		Transfer Agent

	ITEM 2 : Description of PropertiesITEM 3 : Legal ProceedingsITEM 4 : Submission of Matters to a Vote of Securities HoldersInformation Statement
		Proxy Statement


PART IIITEM 5 : Market for Common Equity and Related Stockholders MattersMarket Information
		Securities Authorized for Issuance under Equity Compensation Plans
		Recent Sales of Unregistered Securities and Changes in Control of the Company

	ITEM 6 : Management's Discussion and Analysis or Plan of OperationResults of Operations
			Liquidity and Capital Resources
			Plan of Operations
			Service Agreements
			Off-Balance Sheet Arrangements

	ITEM 7 : Financial Statements (Index)Index to Financial Statements
	ITEM 8 : Changes in and Disagreements with Accountants on Accounting and Financial DisclosuresITEM 8a : Controls and Procedures


PART IIIITEM 9 : Directors, Executive Officers, promoters and control persons; Compliance with 16(a) of the Exchange ActIdentification of Directors and Executive Officers
			Biographies of Officers and Directors
			Involvement in Certain Legal Proceedings
			Audit Committee
			Audit Committee Financial Expert
			Compliance with Section 16(a) of the Exchange Act

	ITEM 10 : Executive CompensationCompensation of Officers and Directors
			Stock Option Plan

	ITEM 11 : Security Ownership of Certain Beneficial Owners and ManagementITEM 12 : Certain Relationships and Related TransactionsManagement Contracts
			Indemnification Provisions
	ITEM 13 : Exhibits and Reports on Form 8-KAudit Fees
			Financial Information Systems Design and Implementation Fees
			All Other Fees
	ITEM 14 : Controls and Procedures



SIGNATURESExhibit 2.1 - Merger AgreementExhibit 10.1 - Stock Option PlanExhibit 11.1 - Statement of Computation of Per Share EarningsExhibit 99.1 - Certification of Chief Executive OfficerExhibit 99.2 - Certification of Chief Financial OfficerExhibit 99.3 - Certification Pursuant to Securities Exchange Act of 1934
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

---

|**FORWARD LOOKING STATEMENTS**

Statements made in this Form 10-KSB that are not historical or current facts
  are "forward-looking statements" made pursuant to the safe harbor
  provisions of Section 27A of the Securities Act of 1933 (the "Act")
  and Section 21E of the Securities Exchange Act of 1934. These statements often
  can be identified by the use of terms such as "may," "will,"
  "expect," "believe," "anticipate," "estimate,"
  "approximate" or "continue," or the negative thereof. The
  Company intends that such forward-looking statements be subject to the safe
  harbors for such statements. The Company wishes to caution readers not to place
  undue reliance on any such forward-looking statements, which speak only as of
  the date made. Any forward-looking statements represent management's best judgment
  as to what may occur in the future. However, forward-looking statements are
  subject to risks, uncertainties and important factors beyond the control of
  the Company that could cause actual results and events to differ materially
  from historical results of operations and events and those presently anticipated
  or projected. The Company disclaims any obligation subsequently to revise any
  forward-looking statements to reflect events or circumstances after the date
  of such statement or to reflect the occurrence of anticipated or unanticipated
  events.
**Available Information**
Transax International Limited files annual, quarterly and current reports, proxy
  statements and other information with the Securities and Exchange Commission
  (the “Commission”). You may read and copy documents referred to
  in this Annual Report on Form 10-KSB that have been filed with the Commission
  at the Commission’s Public Reference Room, 450 Fifth Street, N.W., Washington,
  D.C. You may obtain information on the operation of the Public Reference Room
  by calling the Commission at 1-800-SEC-0330. You can also obtain copies of our
  Commission filings by going to the Commission’s website at http://www.sec.gov
Table of Contents
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

---

|**PART I**Table of Contents**Item 1. Description of Business**Table of Contents
**Business History and Development**
Transax International Limited, a Colorado corporation (the “Company”),
  currently trades on the OTC Bulletin Board under the symbol "TNSX"”.
  Transax International Limited is referred to in this Form 10-KSB as the "Company".
The Company was incorporated under the laws of the State of Colorado in 1999
  under the name “Vega-Atlantic Corporation”. Previously, the Company
  was engaged in the business of minerals and oil and gas exploration, acquisition
  and development within the United States and worldwide. During August 2003,
  the Company completed the acquisition of Transax Limited, a Colorado private
  corporation (“Transax Limited”), pursuant to a reverse merger and
  changed its name to “Transax International Limited” by filing an
  amendment to its articles of incorporation. 
  As of the date of this Annual Report, the Company, through its wholly-owned
  subsidiary TDS Telecommunication Data Systems LTDA. (“TDS”) is an
  international provider of information network solutions, products and services
  specifically designed for the healthcare providers and health insurance companies
  (collectively, the “Health Information Management Products”).
TDS Telecommunication Data Systems LTDA
TDS Telecommunication Data Systems LTDA (“TDS”) was incorporated
  under the laws of Brazil on May 2, 1998, and is a wholly-owned subsidiary of
  the Company. As of the date of this Annual Report, TDS assists the Company in
  providing information network solutions, products and services within Brazil.
Transax Australia Pty Ltd.
Transax Australia Pty Ltd. (“Transax Australia”) was incorporated
  under the laws of the state of New South Wales, Australia on January 19, 2003,
  and is a wholly-owned subsidiary of the Company. As of the date of this Annual
  Report, Transax Australia assists the Company in seeking marketing opportunities
  to provide information network solutions, products and services within Australia
  and regionally.
Medlink Technologies Inc.
Medlink Technologies, Inc. (“Medlink”) was incorporated under the
  laws of Mauritius on January 17, 2003, and is a wholly-owned subsidiary of the
  Company. As of the date of this Annual Report, Medlink holds the intellectual
  property developed by the Company and is responsible for initiating research
  and development.

**Current Business Operations**
As of the date of this Annual Report, the Company, through TDS, is an international
  provider of health information management products (collectively, the “Health
  Information Management Products”), as described below, which are specifically
  designed for the healthcare providers and health insurance companies. The Company
  is dedicated to improving healthcare delivery by providing to hospitals, physician
  practices and health insurance companies with innovative health information
  management systems to manage coding, compliance, abstracting and record managements
  processes.
The strategic focus of the Company is to become a premier international provider
  of health information management network solutions for the healthcare providers
  and health insurance companies, enabling the real time automation of routine
  patient transactions. Management of the Company believes that the Company’s
  unique combination of complimentary solutions is designed to significantly improve
  the business of healthcare. The Company’s Health Information Management
  Products and software solutions are designed to generate operational efficiencies,
  improve cash flow and measure the cost and quality of care.
MedLink Products
The Health Information Management Products and software solutions, including
  the MedLink Solution, fall into four main areas: (i) compliance management;
  (ii) coding and reimbursement management; (iii) abstracting; and (iv) record
  management.
Management of the Company believes that hospitals and other healthcare providers
  must implement comprehensive coding and compliance programs in order to minimize
  payer submission errors and assure the receipt of anticipated revenues. Management
  believes that an effective program should include clear, defined guidelines
  and procedures, which combined with the Company’s Health Information Management
  Products, will enhance an organization’s system and effectively increase
  revenues and reduce costs. The Company’s Health Information Management
  Products will include compliance management and coding and reimbursement products
  and software, which are designed to conduct automated prospective and retrospective
  reviews of all in-patient and out-patient claims data. Management tools include
  internally designed targets aimed to provide data quality, coding accuracy and
  appropriate reimbursement. These tools work in conjunction with an organization’s
  coding and billing compliance program to (i) identify claims with potential
  errors prior to billing; (ii) screen professional fees and services; and (iii)
  identify patterns in coding and physician documentation. Results of the auditing
  and monitoring activities are represented in executive reports summarizing clinical
  and financial results as well as detailed reports providing information needed
  to target specific areas for review. Billing practices for health care services
  are under close scrutiny by governmental agencies as high-risk areas for Medicare
  fraud and abuse. Management of the Company believes that the Health Information
  Management Products will increase an organization’s progress in reducing
  improper payments and ensuring that medical record documentation support services
  are provided.
The Health Information Management Products are also designed to include abstracting
  solutions, which enable healthcare facilities to accurately collect and report
  patient demographic and clinical information. Management of the Company believes
  that the Health Information Management Products will provide the organization
  with the ability to calculate in-patient and out-patient hospital reimbursements
  and customize data fields needed for state, federal or foreign governmental
  regulatory requirements. Standard and custom reports will provide the customer
  with the ability to generate facility-specific statistical reporting used for
  benchmarking, outcomes and performance improvement, marketing and planning.
  Management of the Company believes that the Health Information Management Products
  will further provide healthcare organizations the flexibility to customize abstracting
  workflow to meet data collection reporting and analysis needs. The Health Information
  Management Products will provide the organization with the ability to customize
  workflow by creating fields and rules and designing screen navigation.
Management of the Company also believes that the Health Information Management
  Products will provide record management, which will automate the record tracking
  and location functions, monitor record completeness and facilitate the release
  of information process within health information management departments. The
  Health Information Management Products will assist healthcare organizations
  in properly completing records pursuant to state, federal, foreign governmental
  and medical staff requirements. The management tools are designed to monitor
  a facility’s adherence to patient privacy, disclosure and patient bill
  of rights requirements, if applicable.

MedLink Solution
The Company has developed a proprietary software trademarked (Brazil only) “MedLink
  Solution”, which was specifically designed and developed for the healthcare
  and health insurance industry enabling the real time automation of routine patient
  eligibility, verifications, authorizations, claims processing and payment functions
  that are currently performed manually (the “MedLink Solution”).
  A transaction fee is charged to the insurer for use of the MedLink Solution.
  
  The MedLink Solution hosts its own network processing system (the “Total
  Connectivity Solution”), whereby the Company is able to provide an insurer
  with the ability to cost effectively process all of the transactions generated
  regardless of location or method of generation. Management of the Company believes
  that the MedLink Solution solves technological and communication problems
  within the healthcare systems by creating a virtual “paperless office”
  for the insurer and total connectivity, regardless of method, for the health
  provider. The MedLink Solution replaces manual medical claims systems and provides
  insurance companies and healthcare providers significant savings through a substantial
  reduction in operational costs. The MedLink Solution allows users to collect,
  authorize and process transaction information in real-time for applications
  including, but not limited to, patient and provider eligibility verification,
  procedure authorization and claims and debit processing. Participants of the
  MedLink Solution include private health insurance companies, group medical companies,
  and healthcare providers.
As of the date of this annual report the Company has installed approximately
  1,900 solutions into healthcare provider locations throughout Brazil and plans
  to install up to a further 10,000 solutions during fiscal 2004. “Item
  1. Description of Business – Material Agreements.”
MedLink Solution Architecture and Design
  Management of the Company believes that the MedLink Solution is the total
    connectivity system that will allow hospitals, clinics, medical specialists
    and other healthcare providers to easily capture, route, and authorize medical,
    hospital, and dental claims in “real time”. The MedLink Solution
    will address pre-existing technological and communication problems by creating
    a universal virtual link between the insurer and the care provider.
  The MedLink Solution’s architecture and design is as follows:Seven capture methods;
    A network processor;
    An authorizer.
  Capture Methods
  The MedLink Solution is tailored to the specific care provider's environment
    and needs usage based upon its technological resources, physical installation
    and volume of claims.
  The MedLink Solution offers seven different methods to capture data. The health
    care provider can select which of these seven methods best suit its operational
    needs and technological abilities. Regardless of the capture method chosen,
    transactions are seamless and efficient. The MedLink Solution’s capture
    methods are:
  MedLink Solution POS Terminal;
    MedLink Solution Phone;
    MedLink Solution PC Windows
    MedLink Solution PC Net
    MedLink Solution Server Labs
    MedLink Solution Server Hospitals
    MedLink Solution Web
  Network Processor
  The MedLink Solution network processor routes the transactions captured by
    the MedLink Solution (the “Network Processor”) to the authorization
    system of the healthcare plan (the “Authorization System”). For
    example, in Brazil this process is carried out either using Embratel's Renpac
    service or the Internet. The Network Processor offers uninterrupted 24-hour,
    seven days a week operation and service.
  The Network Processor is secured from the Renpac and Internet communication
    channels to the communication channels with the Authorization System , passing
    through the elements of local network, processors and unities of storage of
    data. It is implemented on a RAID5 disk array architecture.
  
  Authorization System
  The Authorization System's software is composed of a control module and a
    group of storage procedures that validate the specific rules of the health
    plan or insurer. It is responsible for:
  Receiving and decoding the messages sent by the Network Processor, containing
      the solicitations of the MedLink Solution installed at the provider;
    Identification of the kind of the message (claim, refund, settlement,
      etc) and of the service provider;
    Validation or denial of the transaction;
    Updating the historical database of the claims;
    Replying to the request by sending a message to the Network Processor.

Product Target Market Strategy
Market Strategy
    The Company’s key marketing strategy is to position the Company as a
    market leader in providing total information management network processing
    solutions for the healthcare industry worldwide. Management of the Company
    believes that its Health Information Management Products encompass a variety
    of solutions for healthcare provider locations, a complete network processing
    service for the health insurance companies, and in-house software and systems
    development to address specific and unique customer requirements, and the
    ability to operate the systems through a variety of communication methods.
  The promotional and marketing strategy is based on creating a proactive “push
    pull” effect on the demand for the Health Information Management Products
    and services within the healthcare industry. The Company has been focusing
    on the promotion and marketing of its products to the Brazilian healthcare
    providers and insurance companies by demonstrating: (i) the benefits of the
    MedLink Solution application and services; (ii) real-time cash visibility;
    (iii) nominal to no capital investment; (iv) the established Network Processor
    facility; (v) custom software development support; and (vi) option of immediate
    payment of outstanding claims.
  Management of the Company believes that this commonly used marketing and promotional
    model will be suitable and used for initial market penetration. However, international
    marketing and promotional strategies will be developed and adapted on a country-to-country
    basis to meet different market environments and governmental requirements,
    build business and political relationships, and obtain domestic media exposure
    and high visibility within the local healthcare industry to establish credibility.
  The Company has identified two initial target markets for its products. They
    are: (i) healthcare providers, such as physicians, clinics, hospitals, laboratories,
    diagnosis centers, emergency centers, etc.; and (ii) health insurance and
    group medicine companies.
    As of the date of this Annual Report, the Company has been successfully short-listed
    by the Australian Federal Government through its Health Insurance Commission
    (the “HIC”), to supply an authorization and eligibility solution
    for the Australian health insurance market. Management of the Company is currently
    engaged in negotiations with the HIC regarding the sale and purchase of its
    Health Information Management products for use in Australia’s health
    insurance reimbursement system. On January 19, 2003, the Company established
    a wholly-owned subsidiary, Transax Australia Pty Ltd (“Transax Australia”),
    to seek additional opportunities within Australia.
    As of the date of this Annual Report, the Company is currently focused primarily
    on the marketing and sale of its Health Information Management products in
    Brazil. Management of the Company believes that there is a significant global
    market opportunity for its Healthcare Information Management Products and
    services and software technology. As of the date of this Annual Report, the
    Company has entered into discussions with a number of groups within the United
    States, Australia and New Zealand with regard to potential joint venture relationships
    and licensing arrangements regarding its Health Information Management Products.

Strategic Alliances
The Company has developed key strategic alliances with the following technology
  providers to support the MedLink Solution’s unique system architecture
  and design. Management of the Company believes that the establishment of these
  strategic alliances have given the Company a significant competitive advantage
  in Brazil.
GENS Information – PMS/ASP
  On February 19, 2001, the Company and GENS Information (“GENS”),
    entered into an operating agreement (the “GENS Operating Agreement”).
    Pursuant to the terms and provisions of the GENS Operating Agreement: (i)
    GENS will provide to the Company a basic product called “Personal Med”,
    which is a Windows client-server application, running with Delphi front-end
    and Paradox and Oracle DB; and (ii) the Company will incorporate the MedLink
    Solution transaction services within the Personal Med allowing for its users
    to use the MedLink Solution services from within their PMS.
  Management of the Company believes that GENS is the leading Brazilian developer
    of practice management software with over 50% of the market share. Personal
    Med is the name of GENS basic product, with some thirty variations according
    to doctor’s specialization. The variations are designed around specific
    exams data to be acquired and stored in each medical specialization.
  Management of the Company estimates that current installed basis is approximately
    10,600 copies sold directly to doctors, plus approximately 500 copies sold
    to corporations. Management of the Company believes that Gens has approximately
    50% of the Brazilian market in practice management systems. The current structure
    sells an average of 200 copies a month, plus special events.
  As of the date of this Annual Report, GENS is implementing versions to its
    Personal Med based on SQL server, and is further developing a web enabled
    version, which will allow doctors to select patients they want to have access
    through the InternetWeb, and a tool to access the database of each patient
    for this centralized base. GENS is also iimplementing access to doctor’s
    agenda and some direct news to be directed to Internet enabled doctors.
  Vidalink – Drug Management
  On August 29, 2001, the Company and Vidalink entered into an operational agreement
    (the “Vidalink Operational Agreement”), to allow the Vidalink
    Health Portal access to the MedLink Solution connectivity services, creating
    the first authorization and claims processing Internet service in Brazil.
    The Vidalink Health Portal offers doctors, the most extensive set of information
    on pathologies and medication practices, with complete drug interaction analysis
    and alert functionality. It offers also extensive continuous education programs,
    with selection of doctor’s areas of interest and automatic issuing news
    on selected subjects.
  Pursuant to the terms and provisions of the Vidalink Operational Agreement,
    the MedLink Solution connectivity capabilities will be added to the Vidalink
    Health Portal, which will give the MedLink Solution access to Vidalink’s
    drug management services and Internet content, thus creating a synergic relationship
    between the two portals and allow doctors access to each portal reaching a
    much broader range of services.
  Vidalink is a health portal focused in offering the premier drug management
    service package in Latin America, with operations in Mexico and Brazil. Through
    Vidalink, health plans have access to drug discount programs, as well as an
    extensive drug usage management service, capable of monitoring consumption
    of specific drugs by patients.
  Management of the Company believes that the Vidalink programs are supported
    by agreements with approximately twenty-two of the largest pharmaceutical
    industries in Brazil, offering discount packages for drugs covering over 85%
    of total chronic diseases. Management of the Company further believes that
    Vidalink also offers a drug delivery scheme from an extensive network of pharmacies
    reaching over 5000 points of presence nationwide.
  Mosaic Software, Inc – Network Processor System
  On November 25, 2003, the Company and Mosaic entered into supplier agreement
    (the “Mosaic Supplier Agreement”). to develop the Network Processor
    software package, known as the “Postillion”, for use in the MedLink
    Solution.
    Management of the Company believes that Mosaic is the supplier of the most
    modern technology for network control software, based on a low cost hardware
    platform (PC’s) and Windows NT software. Management believes the Position
    software is the best cost /effect solution for this kind of system, and has
    just been selected by Calypso, the new ATM being deployed in United States,
    as the chosen platform.Hypercom Corporation
  On December 1, 2003, the Company and Hypercom Inc., a publicly traded
multinational company ("Hypercom"), entered into a servicing agreement (the
"Hypercom Service Agreement"). Pursuant to the terms and provisions of the
Hypercom Service Agreement Hypercom would provide leasing arrangements for
POS (Point of Sale) terminals in Brazil. The company subsequently entered
into lease for 255 POS units. 
   On April 30th 2002, the Company and Netset a wholly owned subsidiary of
Hypercom based in Brazil entered into a service agreement whereby Netset
will (i) provide to the Company installation, servicing, training, customer
service and technical support (Call Center) for its terminal network in
Brazil; and (ii) allow the Company to use the entire Hypercom structure to
serve its clients.
  Management of the Company believes that Hypercom has operations in more than
100 countries, annual revenues of more than US$400 million, and has been in
the Electronic Funds Transfer (EFT) and Communication Networks markets since
1977.
Management further believes that recent data indicates Hypercom is
increasingly positioning itself as the world leader in POS terminals, and
may be leader in the market of financial transactions.SchlumbergerSema
  On May 5, 2003, the Company and SchlumbergerSema (“Schlumberger”)
    entered into an agreement (the “Schlumberger Agreement”), pursuant
    to which Schlumberger will allow the Company to implement its MedLink Solution
    into the first medical smart card in Brazil for over 350,000 employees of
    Petrobras (the Brazil state oil corporation)
    Management of the Company believes that Schlumberger has twenty years of innovation
    experience in the intelligent smart cards market and is a world leader in
    providing financial cards, with more than 1,000,000 terminals installed in
    over sixty countries. Management further believes that Schlumberger is the
    world’s second largest provider of smart cards after the takeover of
    Sema in 2000.
  The Company’s strategic alliance with Schlumberger covers the following
    components: (i) capture devices, which consist of a combination of capture
    application hardware and software capable of identifying and handling pre-defined
    services entries, to be rerouted by means of electronic transactions to an
    authorizer system; (ii) rerouting, which is the development of a hardware
    and software structure for performing services of collecting electronic transactions
    at one service point (a service provider), where there is a capture device,
    with the rerouting of the transaction to a service authorization system, and
    the following return of the authorization’s result to the capture device;
    and (iii) authorization system, which is comprised of a hardware structure
    and application software, for creating parameters for the business regulations,
    tables and insured registries, providers and histories, and is responsible
    for handling the transactions received from the collection network, in reference
    to services, their analyses, release or negative, and for sending the corresponding
    response to the registered provider, in the form of a message.

Research and Development Agreements
The Company’s research and development department is responsible for the
  definition, design and implementation of the products associated with the Company.
This comprises three main areas of activity: research of electronic transaction
  product trends both in Brazil and around the world as it applies to the
  Healthcare industry, definition of products and services required for MedLink
  Solution services and implementation of the hardware and software products to
  support MedLink Solution services.
Products to be offered by MedLink iSolution nvolves interactive discussions
  with the marketing and sales team in order to identify the market needs, costs
  and timing to introduce such products and solutions.
The Company has entered into agreements with Hypercom and Dione PLC, of the
  United Kingdom, to utilize their terminals for the MedLink Solution. The Company
  is also currently negotiating with Helett Packard (HP) for the supply of PC’s
  and services to be used by doctors’ clinics and labs and with Alteer for
  the introduction of practice management software.

Material Agreements

Merger Agreement
  The Board of Directors of the Company, at a special meeting, approved the
    execution of an agreement in principle dated June 19, 2003 and a subsequent
    merger agreement and its ancillary documents dated July 22, 2003 (collectively,
    the “Merger Agreement”) among the Company, Vega-Atlantic Acquisition
    Corporation, the Company’s wholly-owned subsidiary (“Vega-Atlantic”),
    Transax Limited, a Colorado corporation (“Transax”), and certain
    selling shareholders of Transax. The Merger Agreement and the Company’s
    acquisition of Transax by way of merger was completed effective as of August
    14, 2003 (the “Effective Date”). 
    In accordance with the completion of the terms and conditions of the Merger
    Agreement: (i) Vega-Atlantic merged with Transax (the “Merger”)
    so that Transax became the surviving company and a wholly-owned subsidiary
    of the Company and, correspondingly, the shareholders, warrantholders and
    optionholders of Transax became shareholders, warrantholders and optionholders
    of the Company; (ii) the Company’s business operations became that of
    Transax, primarily consisting of the development, acquisition, provider and
    marketing of information network solutions for healthcare providers and health
    insurance companies world-wide; (iii) the Company changed its name to "Transax
    International Limited" and its trading symbol; and (iv) the Company adopted
    and implemented a “Stock Option Plan” for key personnel of the
    Company.
  Pursuant to the terms and conditions of the Merger Agreement and a corresponding
    contribution agreement, as entered into between the Company and Vega-Atlantic,
    on the Effective Date (i) the Company contributed to Vega-Atlantic 11,066,207
    shares of its restricted common stock (the “Common Stock”) and
    4,500,000 stock options and 4,100,000 share purchase warrants to acquire any
    equivalent number of shares of Common Stock of the Company; (ii) Vega-Atlantic
    exchanged therefore with all Transax shareholders an aggregate of 11,066,207
    shares of the Company’s restricted Common Stock (on the basis of each
    two Transax shares of common stock exchanged into one share of Common Stock
    of the Company); (iii) Vega-Atlantic exchanged therefore with all Transax
    optionholders an aggregate of 4,500,000 stock options to acquire up to 4,500,000
    shares of the Company’s Common Stock to replace all stock options then
    outstanding in Transax (on the basis of each two Transax stock options exchanged
    into one stock option of the Company); and (iv) Vega-Atlantic exchanged therefore
    with all Transax warrantholders an aggregate of 4,100,000 share purchase warrants
    to acquire up to a further 4,100,000 shares of the Company’s Common
    Stock to replace all share purchase warrants then outstanding in Transax (on
    the basis of each two Transax share purchase warrants exchanged into one share
    purchase warrant of the Company).
  Interim Secured and Convertible Loan Agreement
  As a condition to entering into and in accordance with the Merger Agreement,
    the Company agreed to use its commercially reasonable efforts to advance to
    Transax the aggregate principal sum of up to $250,000 (collectively, the “Principal
    Sum”) within five (5) business days of raising of a minimum of $250,000.
    As of the date of this Annual Report, the Company has received no funding.
  TDS License Agreement
      Golden Cross
    On August 9, 2002, TDS and Golden Cross, one of Brazil’s largest health
      insurance companies (“Golden Cross”) entered into an agreement
      (the “Golden Cross Agreement”). Pursuant to the terms and conditions
      of the Golden Cross Agreement, the Company has committed to supply to Golden
      Cross a total of 1,500 installations consisting of more than 500 MedLink
      Solution POS terminals with the balance being MedLink PC and MedLink Solution
      servers. Additional installations (principally IVR) are planned following
      the first phase roll out, which management anticipates to begin in the second
      quarter of 2004. The Golden Cross Agreement also provides for MedLink Solution
      WEB and MedLink Solution phone solutions, which will be used as appropriate
      by the healthcare provider. As of the date of this Annual Report, the Company
      has approximately 1,750 Medlink Solutions in Golden Cross Provider’s
      locations. During the month of March 2004, the Company processed 174,000
      transactions for Golden Cross.
      Camed
    On October 17, 2002, TDS and Camed, a self-insured company based in northern
      Brazil (“Camed”), entered into an agreement (the “Camed
      Agreement”) pursuant to which the Company installed MedLink Solution
      POS terminals for pilot testing, which was completed during first quarter
      2003. As of the date of this Annual Report, more then 5,000 installations
      are scheduled to complete the roll out consisting of 250 MedLink Solution
      POS terminals and 4,800 IVR Phone. The Camed Agreement also provides for
      MedLink Solution WEB and MedLink Solution phone solutions, which will be
      used as appropriate by the healthcare providers. As of the date of this
      report the Company has approximately 200 Medlink Solutions in Camed providers’
      locations. During the month of March 2004, the Company processed 18,000
      transactions for Camed.
    Bradesco Health
    On October 17, 2002 TDS and Bradesco Insurance (“Bradesco”),
      Brazil’s largest health insurance company, entered into an agreement
      for the provision of a four month pilot program contract for the testing
      of its “Medlink” Solution. Subsequently, in February 2003, the
      pilot program was extended for a further six months at the request of Bradesco.
      On October 1, 2003 Bradesco and the Company entered into a contract pursuant
      to which the Company would undertake and install its “Medlink”
      Solution into the Bradesco healthcare provider’s network. In order
      to undertake this program, Bradesco agreed to set up a stand alone processing
      facility to hold its database, which was subsequently contracted to a third
      party. Phase one of the program went live during March 2004. Current roll
      out plans indicate that the Company will install up to 5,000 solutions into
      the Bradesco provider’s network during 2004 in order to achieve Bradesco’s
      initial target of 1,000,000 transactions per month.

Competition
The information network solutions market for the healthcare providers and health
  insurance companies is characterized by rapidly evolving technology and intense
  competition. Many companies of all sizes, including a number of large technology
  companies, such as IBM< siemens and EDS, as well as several specialized healthcare
  information management companies, are developing various products and services.
  There may be products on the market that do or will compete directly with the
  products and services that the Company is seeking to develop. These companies
  may also compete with the Company in recruiting qualified personnel. Many of
  the Company’s potential competitors have substantially greater financial,
  research and development, human and other resources than the Company does. Furthermore,
  the larger companies may have significantly more experience than the Company
  does in developing such products and services. Such competitors may: (i) develop
  more efficient and effective products and services; (ii) obtain patent protection
  or intellectual property rights that may limit the Company’s ability to
  commercialize its products or services; or (iii) commercialize products and
  services earlier than the Company does.
Management of the Company expects technology developments in the healthcare
  information management and technology industry to continue to occur at a rapid
  pace. Commercial developments by any competitors may render some or all of the
  Company’s potential products or services obsolete or non-competitive,
  which could materially harm the Company’s business and financial condition.
Management believes that the following Brazilian companies, which have developed
  or are developing various types of similar products or services, could be major
  competitors of the Company: (i) Polimed, which offers two modalities for the
  authorization software; (ii) Connectmed, which offers Internet connectivity
  services; and (iii) Salutia, which offers a connectivity system with software
  to be installed and integrated to the management systems, similar to the Company’s
  MedLink Solution Web and MedLink Solution Server and related technologies.
Management of the Company believes, however, that its Health Management information
  Products and related services and solutions for the healthcare providers and
  health insurance companies represent an unique approach and has certain competitive
  advantages as follows:
the MedLink Solution significantly reduces medical administrative procedures
    and costs through connecting in real time individual healthcare provider locations
    to health insurance companies;
  irrespective of the choice of connectivity or the method of transmission,
    MedLink provides a secure and reliable service where healthcare providers
    can automatically verify patient eligibility, receive authorization for the
    performance of approved medical procedures and process a paperless claim electronically
    with each insurance provider it interacts with, provided they are subscribed
    to the network;
    once connected to the network, MedLink Solution provides numerous benefits
    to doctors and private health insurance companies including the automation
    of their paper-based clerical duties; and
  by using MedLink Solution, many of these cumbersome tasks can be processed
    electronically in seconds, virtually eliminating processing costs, paperwork,
    and the high risks associated with fraud.
Government Regulation
As of the date of this Annual Report, none of the Company’s software products
  or services are regulated by the U.S. Department of Health. However, there is
  substantial state and federal regulation of the confidentiality of patient medical
  records and the circumstances under which such records may be used, disclosed
  to or processed by the Company as a consequence of the Company’s contacts
  with various healthcare providers and health insurance companies. Although compliance
  with these laws and regulations is presently the principal responsibility of
  covered entities, including hospitals, physicians or other healthcare providers,
  regulations governing patient confidentiality rights are rapidly evolving. Additional
  federal and state legislation governing the dissemination of medical record
  information may be adopted which could have a material affect on the Company’s
  business. Those laws, including HIPAA and ICD 10 implementation, may significantly
  affect the Company’s future business and materially impacts the Company’s
  product and service development, revenue and working capital. During the past
  several years, the healthcare industry also has been subject to increasing levels
  of governmental regulation of, among other things, reimbursement rates and certain
  capital expenditures. The Company is unable to predict what, if any, changes
  will occur as a result of such regulation.

Intellectual Property, Patents and Trademarks
Patents and other proprietary rights are vital to the business operations of
  the Company. The Company's policy is to seek appropriate copyright and patent
  protection both in the United States and abroad for its proprietary technologies
  and products. Pursuant to the TDS License Agreement, the Company acquired the
  license to certain intellectual property as follows:
‘Medlink” registered trade name in Brazil Registration number
    820986160 filed on August 17, 1998 with INPI Brazil;
Source code for all of the Medlink Solutions, source nodes and Network
    processor source code.The Company has initiated copyright protection of its products in the United
  States using appropriate intellectual property counsel. The Company intends
  to apply for a process patent in the near future.

**Employees**
The Company’s Brazilian subsidiary, TDS, employs approximately 40 staff
  and contract personnel.
As of the date of this Annual Report, the Company does not employ management
  on a full-time or on a part-time basis. The Company's President/Chief Executive
  Officer and Chief Financial Officer are is primarily responsible for all day-to-day
  operations of the Company. Other services are provided by outsourcing and verbal
  management contracts. As the need arises and funds become available, however,
  management may seek employees as necessary in the best interests of the Company.
  For a discussion of the services performed for the Company by its officers and/or
  directors and consultants pursuant to contractual relationships, see "Part
  III. Item 10. Executive Compensation” and “Part III. Item 12. Certain
  Relationships and Related Transactions”.

**Risk Factors**
The shares of the Company are highly speculative and involve an extremely high
  degree of risk. Shareholders of the Company should consider the following risk
  factors.
- Rapid Development Changes
  The healthcare information management and technology market is highly fragmented
    and characterized by on-going technological developments, evolving industry
    standards and rapid changes in customer requirements. The Company’s
    success depends on its ability to timely and effectively: (i) offer a broad
    range of software products; (ii) enhance existing products and expand product
    offerings; (iii) respond promptly to new customer requirements and industry
    standards; (iv) remain compatible with popular operating systems and develop
    products that are compatible with the new or otherwise emerging operating
    systems; and (v) develop new interfaces with healthcare provider organizations
    to fully integrate the Company’s products and services in order to maximize
    features and functionality. The Company’s performance depends in large
    part on its ability to provide the increasing functionality required by its
    customers through the timely development and successful introduction of new
    products and enhancements to existing products. The Company may not successfully,
    or in a timely manner, develop, acquire, integrate, introduce or market new
    products or product enhancements. Product enhancements or new products developed
    by the Company may not meet the requirements of hospital or other healthcare
    providers or health insurance companies or achieve or sustain market acceptance.
    The Company’s failure to either estimate accurately the resources and
    related expenses required for a project, or to complete its contractual obligations
    in a manner consistent with the project plan upon which a contract is based,
    could have a material adverse effect on the Company’s business, financial
    condition, and results of operations. In addition, the Company’s failure
    to meet a customer’s expectations in the performance of its services
    and products could damage the Company’s reputation and adversely affect
    its ability to attract new business.
  - Failure to Accurately Assess, Process or Collect Healthcare Claims or Administer
    Contracts Could Subject the Company to Costly Litigation and Force the Company
    to Make Costly Changes to Products.
  It is anticipated that some of the Company’s products and services will
    be used in the payment, collection, coding and billing of healthcare claims
    and the administration of managed care contracts. If the Company’s products
    and services fail to accurately assess, possess or collect these claims, customers
    could file claims against the Company. As of the date of this Annual Report,
    the Company does not carry insurance coverage to cover such claims or, if
    it does carry such insurance coverage in the future, such insurance coverage
    may not be adequate to cover such claims. A successful claim that is not covered
    by or is in excess of insurance coverage could adversely affect the Company’s
    business, financial condition, and results of operations. Even a claim without
    merit could result in significant legal defense costs and could consume management
    time and resources. In addition, claims could increase insurance premiums
    such that appropriate insurance cannot be found at commercially reasonable
    rates. Furthermore, if the Company was found liable, the Company may have
    to significantly alter one or more of its products, possibly resulting in
    additional unanticipated research and development expenses.
  - Nature of Products Makes Company Vulnerable to Undetected Errors That Could
    Reduce Revenues, Market Share or Demand.
  Health Information Management Products may contain errors or failures, especially
    when initially introduced on when new versions are released. Although the
    Company conducts extensive testing of its products and services, software
    errors could be discovered in certain enhancements and products after their
    introduction. Despite such testing by the Company and by its current and potential
    customers, products under development, enhancements or shipped products may
    contain errors or performance failures resulting in, among other things: (i)
    loss of customers and revenue; (ii) delay in market acceptance; (iii) diversion
    of resources; (iv) damage to the Company’s reputation; or (v) increased
    service costs. Any of these consequences could have a material adverse effect
    on the Company’s business, financial condition and results of operations.
  - The Company may be Required to Make Substantial Changes to its Products
    if They Become Subject to Governmental Regulation.
  As of the date of this Annual Report, none of the Company’s Health Information
    Management Products are subject to regulation by the United States’
    federal government. Computer products used or intended for use in the diagnosis,
    cure, mitigation, treatment or prevention of disease or other conditions or
    that affect the structure or function of the body are subject to regulation
    by the US Department of Health. In the future, however, the US Department
    of Health could determine that some of the Company’s products (because
    of their predictive aspects) may be clinical decision tools and subject them
    to regulation. Compliance with US Department of Health regulations such as
    HIPPA could be burdensome, time consuming and expensive. Other new laws and
    regulations affecting healthcare software development and marketing could
    also be enacted in the future. If so, it is possible that the Company’s
    costs and the length of time for product development and marketing could increase
    and that other unforeseeable consequences could arise.
  -Government Regulation of Confidentiality of Patient Health Information Could
    Result in Required Product Modifications.
  There is substantial U.S. federal and state and foreign regulation of confidentiality
    of patient health information and the circumstances under which such information
    may be used by, disclosed to or processed by the Company as a consequence
    of any contracts with various health care providers or insurance companies.
    Although compliance with these laws and regulations is presently the principal
    responsibility of the hospital, physician or other healthcare provider, regulations
    governing patient confidentiality rights are dynamic and rapidly evolving.
    Changes may be made which would require the Company to change its products
    and systems and methods which could require significant expenditures of capital
    and decrease future business prospects. Additional federal and state legislation
    governing the dissemination of individually identifiable information have
    been proposed in the United States and may be adopted, which may also significantly
    affect the Company’s business.
  - Government Regulation of Healthcare Information Delivery Systems May Affect
    Healthcare Providers’ Decisions.
  During the past several years, the healthcare industry within the United States
    and other countries has been subject to changing political, economic and regulatory
    influences and to increasing levels of governmental regulation. Certain proposals
    to reform the U.S. heathcare systems have been and are being considered by
    Congress. These proposals, if enacted, could change the operating environment
    for any of the Company’s customers within the United States that could
    have a negative impact on the Company’s business, financial condition
    and results of operations. However, the U.S. federal government recently mandated
    the use of electronic transmissions for large Medicare providers, which may
    positively affect the marketability of the Company’s products in the
    U.S. The Company is unable to predict what, if any, changes will occur.
  Changes in current healthcare financing, reimbursement systems and procurement
    practices could result in unplanned product enhancements, delays, or cancellations
    of product orders or shipments, or reduce the need for certain systems. A
    portion of the Company’s revenues is expected to be derived from sales
    of its Health Information Management Products to hospitals in the United States.
    Consolidation in the healthcare industry, particularly in the hospital and
    managed care markets, could decrease the number of potential purchasers of
    the Company’s Health Information Management Products and adversely affect
    the Company’s business. In addition, the decision to purchase such products
    generally involves a committee approval. Consequently, it is difficult for
    the Company to predict the timing or outcome of the buying decisions of the
    Company’s potential customers.
  - There are Political and Economic Risks in Foreign Marketplaces.
  As of the date of this Annual Report, the Health Information Management Products
    are sold by the Company principally in Brazil. The Company intends to enter
    the global marketplace which includes, but is not limited to, the marketplaces
    within the United States, Australia, South America and Europe. During fiscal
    year ended December 31, 2003, international sales accounted for 100% of the
    Company’s total revenue. As a result, the Company faces certain risks
    associated with international sales. International sales may be subject to
    political, economic, legal and other uncertainties occurring within these
    countries. Changes in policies by the respective governments may result in
    changes in laws, regulations or the interpretation thereof, confiscatory taxation,
    restrictions on imports and sources of supply, import duties, corruption,
    economic reforms, and currency revaluation, all of which may materially and
    adversely affect the Company. The continuation or increase of any such disparities
    could affect the political and social stability of the country, and thus the
    operations of the Company. Moreover, there can be no assurance that future
    controversies will not arise which would threaten trade relations between
    the United States and the respective country. In any of such eventualities,
    the business of the Company could be adversely affected.
  - The Company May Face Scrutiny From Governmental Agencies.
  As a result of the rising healthcare costs, U.S. federal and state governments
    and foreign governments have placed an increased emphasis on detecting and
    eliminating fraud and abuse in healthcare programs. Numerous laws and regulations
    now exist within the U.S. and other foreign countries to prevent fraudulent
    or abusive billing, to protect patients’ privacy rights, and to ensure
    patients’ access to healthcare. Violation of the laws or regulations
    governing the Company’s operations could result in the imposition of
    civil or criminal penalties, including temporary or permanent exclusion from
    participation in government healthcare programs, such as Medicare and Medicaid
    in the U.S., the cancellation of any contracts with the Company to provide
    managed care services, and the suspension or revocation of any of the Company’s
    governmental licenses. The Company intends to conduct routine internal audits
    in an effort to ensure compliance with all applicable laws and regulations.
    If errors, discrepancies or violations of laws are discovered in the course
    of these internal audits or otherwise, the Company may be required by law
    to disclose the relevant facts, once known, to the appropriate authorities.
  - The Company May Experience Price Reduction, Reduced Gross Margins and Loss
    of Market Share if the Company is Unable to Successfully Compete.
  Competition for the Company’s products and services is intense and is
    expected to increase. Increased competition could result in reductions in
    the Company’s prices, gross margins and market share, and could have
    a material adverse effect on the Company’s business, financial condition
    and results of operations. The Company competes with other providers of healthcare
    information software and services, as well as healthcare consulting firms.
    Come competitors may have formed business alliances with other competitors
    that may affect the Company’s ability to work with some potential customers.
    In addition, if some of the Company’s competitors merge, a stronger
    competitor may emerge. Some principal competitors include: Polimed, Connectmed
    and Salutia, major software information systems companies, including those
    specializing in the healthcare industry, may not presently offer competing
    products but may in the future enter the Company’s market. Many of the
    Company’s competitors and potential competitors have significantly greater
    financial, technical, product development, marketing and other resources,
    and market recognition than the Company’s has. Many of these competitors
    also have, or may develop or acquire, substantial installed customer bases
    in the healthcare industry. As a result of these factors, our competitors
    may be unable to respond more quickly to new or emerging technologies, changes
    in customer requirements, and changes in the political, economic or regulatory
    environment in the healthcare industry. These competitors may be in a position
    to devote greater resources to the development, promotion and sale of their
    products than the Company can. The Company may not be able to compete successfully
    against current and future competitors, and such competitive pressures could
    materially adversely affect the Company’s business, financial condition
    and operating results.
  - The Inability to Protect Intellectual Property Could Lead to Unauthorized
    Use of the Company’s Products.
  The Company relies on a combination of trade secrets, copyright and trademark
    laws, nondisclosure, non-compete and other contractual provisions to protect
    its proprietary rights. Measures taken by the Company to protect its intellectual
    property may not be adequate, and its competitors could independently develop
    products and services that are substantially equivalent or superior to the
    Company’s products and services. Any infringement or misappropriation
    of the Company’s proprietary software and databases could put the Company
    at a competitive disadvantage in a highly competitive market and could cause
    the Company to loose revenues, incur substantial litigation expense, and divert
    management’s attention from other operations. Intellectual property
    litigation is increasingly common in the software industry. Therefore, the
    risk of an infringement claim against the Company may increase over time as
    the number of competitors in the industry segment grows and the functionality
    of products overlaps. Third parties could asset infringement claims against
    the Company in the future. Regardless of the merits, the Company could incur
    substantial litigation expenses in defending any such asserted claim. In the
    event of an unfavorable ruling on any such claim, such an infringement may
    result in significant monetary liabilities that could have a material adverse
    effect on the business. In the event of an unfavorable ruling on any such
    claim, a license or similar agreement may also not be available to use on
    reasonable terms, if at all. The Company may not be successful in the defense
    of these or similar claims.
  - The Company is Dependent upon the License Agreement to Further Develop and
    Commercialize its Products Effectively or at All.
  To further develop and successfully commercialize the Health Information Management
    Products and related services, the Company and TDS entered into a license
    agreement (the “License Agreement”) to carry out development and
    commercialization of the MedLink Solution within Brazil. Under the terms of
    the License Agreement, the Company will receive certain royalties once its
    subsidiary in Brazil has entered cash flow status.
  The risks associated with the License Agreement include, but are not limited
    to, the following: (i) TDS may not apply the expected resources or required
    expertise in developing the MedLink Solution resources and systems or other
    systems necessary to successfully commercialize the MedLink Solution products;
    and (ii) disputes may arise between the Company and TDS that delay the commercialization
    of the MedLink Solution or adversely affect its sales or profitability. The
    Company’s success will depend on the successful introduction and marketing
    of the MedLink Solution and other products which, in turn, is dependent on
    the continued existence of favorable contractual relations with TDS. The Company’s
    business operations may be materially affected in the event TDS fails to honor
    the terms and provisions of License Agreement.
  - The Company May Require Additional Funding, and Future Access to Capital
    is uncertain.
  It is expensive to develop and commercialize Health Information Management
    Products. The Company plans to continue to conduct research and development,
    which is costly. The Company’s product development efforts may not lead
    to new commercial products, either because the Company’s products fail
    to be found effective or because the Company lacks the necessary financial
    or other resources or relationships to pursue commercialization. The Company’s
    capital and future revenues may not be sufficient to support the expenses
    of its business operations and the development of commercial infrastructure.
    The Company may need to raise additional capital to: (i) fund operations;
    (ii) continue the research and development of Health Information Management
    Products; and (iii) commercialize its products. Management of the Company
    believes that cash on hand will be sufficient to meet the Company’s
    projected operating and capital requirements for at least the next twelve
    months. However, the Company may need additional financing within this time
    frame depending on a number of factors. The Company may not be able to obtain
    additional financing on favorable terms or at all. If the Company is unable
    to raise additional funds, the Company may have to delay, reduce or eliminate
    certain business operations. If the Company raises additional funds by issuing
    equity securities, further dilution to the Company’s existing stockholders
    will result.
  - Failure to Retain Key Personnel Could Impede the Company’s Ability
    to Commercialize its Products, Maintain the License Agreement or Obtain Sources
    of Funds.
  The Company depends, to a significant extent, on the efforts of Mr. Stephen
    Walters, its President/Chief Executive Officer and a director, and on the
    efforts of its executive officers and research and development personnel.
    The development of Health Information Management Products requires expertise
    from a number of different disciplines, some of which are not widely available.
    The quality and reputation of the Company’s research and development
    personnel, including its executive officers, and their success in performing
    their responsibilities, may directly influence the success of the Company.
    In addition, the Company’s President/Chief Executive Officer and other
    executive officers are involved in a broad range of critical activities, including
    providing strategic and operational guidance. The loss of these individuals,
    or the Company’s inability to retain or recruit other key management
    and research and development personnel, may delay or prevent the Company from
    achieving its business objectives. The Company faces intense competition for
    personnel from other companies, public and private research institutions,
    government entities and other organizations.
  - Market Volatility May Affect the Company’s Stock Price, and the Value
    of a Shareholder’s Investment in the Company’s Common Stock May
    be Subject to Sudden Decreases.
  The trading price for the shares of Common Stock of the Company has been,
    and the Company expects it to continue to be, volatile. The price at which
    the Company’s Common Stock trades depends on a number of factors, including
    the following, many of which are beyond the Company’s control: (i) the
    Company’s historical and anticipated operating results, including fluctuations
    in financial and operating results; (ii) the market perception of the prospects
    for health information management network solutions companies as an industry
    sector; (iii) general market and economic conditions; (iv) changes in government
    regulations affecting product approvals, reimbursement or other aspects of
    the Company’s and/or competitors’ businesses; (v) announcements
    of technological innovations or new commercial products by the Company or
    its competitors; (vi) developments concerning the Company’s contractual
    relations with its executive officers, executive management and intellectual
    property rights; and (vii) announcements regarding significant collaborations
    or strategic alliances.
  In addition, the stock market has from time to time experienced extreme price
    and volume fluctuations. These broad market fluctuations may lower the market
    price of the Company’s Common Stock and affect the volume of trading
    in the stock. During periods of stock market price volatility, share prices
    of many health information management network solution companies have often
    fluctuated in a manner not necessarily related to their individual operating
    performance. Accordingly, the Company’s Common Stock may be subject
    to greater price volatility than the stock market as a whole.

**Transfer Agent**
As of the date of this Annual Report, the Company’s transfer agent is
  Transfer Online, Inc., 227 S.W. Pine Street, Suite 300, Portland, Oregon 97204;
  telephone 503.227.2950 and facsimile 503.227.6874.

**ITEM 2. Description of Properties**Table of Contents
Except as described above, the Company does not own any other real estate or
  other properties. The Company leases office space in several locations:
US: 7545 Irvine Center Drive, Suite 200, Irvine, California 92618;
  Brazil: Praia de Botafogo # 440, 4 andar, Botafogo 22250 – 040, Rio
    de Janeiro, RJ Brazil;
  Asia-Pacific: Level 30, Six Battery Road, Singapore, 049909
  Australia: Level 66 & 67, MLC Centre Martin Place, Sydney NSW 2000,
    Australia
**ITEM 3. Legal proceedings**Table of Contents
Management of the Company is not aware of any legal proceedings contemplated
  by any governmental authority or other party involving the Company or its subsidiaries
  or its properties. No director, officer or affiliate of the Company is (i) a
  party adverse to the Company in any legal proceedings; or (ii) has an adverse
  interest to the Company in any legal proceedings. Management is not aware of
  any other legal proceedings pending or that have been threatened against the
  Company, its subsidiaries or its properties.


**ITEM 4. Submission of Matters to a Vote of Securities Holders**Table of Contents
**Information Statement**
The Board of Directors of the Company, at a previous meeting, authorized and
  approved, subject to shareholder approval, a reverse stock split of up to one-for-twenty
  of the Company’s issued and outstanding shares of Common Stock (the “Reverse
  Stock Split”). Therefore, an Information Statement pursuant to Section
  14(c) of the Securities Exchange Act of 1934, as amended (the “Information
  Statement”) was prepared and filed with the Securities and Exchange Commission
  on October 17, 2002 and amended December 16, 2002.
The Information Statement was circulated to the shareholders of the Company
  in connection with the taking of corporate action without a meeting upon the
  written consent of ten (10) or less shareholders holding of record a majority
  of the outstanding shares of the Company’s Common Stock effective March
  25, 2003 (the “March 25, 2003 Written Consent”). As of November
  30, 2002 (the “Record Date”), there were 22,532,110 shares of the
  Company’s Common Stock issued and outstanding. The names of the shareholders
  who signed the March 25, 2003 Written Consent and their respective equity ownership
  of the Company were as follows: (i) TriStar Financial Services, Inc. holding
  of record 1,216,214 shares of Common Stock (5.40%); (ii) Investor Communications
  International, Inc. holding of record 6,071,244 shares of Common Stock (26.94%);
  (iii) Alexander W. Cox holding of record 4,323,300 shares of Common Stock (19.19%);
  and (iv) Brent Pierce holding of record 1,406,247 shares of Common Stock (6.24%).
The matters upon which action was taken pursuant to the March 25, 2003 Written
  Consent included the approval and authorization for the Board of Directors to
  effect the Reverse Stock Split, which was effected by NASDAQ approximately April
  2, 2003.
**Proxy Statement**
On July 22, 2003, the Board of Directors approved and authorized certain corporate
  action, including an amendment to the Company’s Articles of Incorporation
  to effect a proposed change in name and adoption of a stock option plan for
  the Company. The Board of Directors further authorized and directed the filing
  with the Securities and Exchange Commission, and subsequent distribution to
  the shareholders of record as of May 30, 2003, a notice of special shareholders’
  meeting and a proxy statement pursuant to Section 14(a) of the Securities Exchange
  Act of 1934, as amended (collectively, the “Proxy Statement”). On
  approximately July 20, 2003, the Proxy Statement was distributed to all shareholders
  of the Company.
Pursuant to the Proxy Statement, a special meeting of shareholders was held
  on August 8, 2003 (the “Meeting”) for the following purposes: (i)
  to approve a proposed amendment to the Company's Articles of Incorporation,
  as amended (the "Amendment"), to effectuate a proposed name change
  of the Company (the “Name Change”) to such name as may be approved
  by the Board of Directors of the Company in its sole and absolute discretion;
  (ii) to approve a proposed stock option plan for key personnel of the Company
  (the “Stock Option Plan”); and (iii) to ratify the prior actions
  by shareholders of the Company taken pursuant to the March 25, 2003 Written
  Consent approving the Reverse Stock Split.
  Only shareholders of record at the close of business on June 9, 2003 (the "Record
  Date") were entitled to notice of and to vote the shares of Common Stock
  of the Company held by them on such date at the Meeting or any and all adjournments
  thereof. As of the Record Date an aggregate 1,126,606 shares of Common Stock
  were outstanding. There was no other class of voting securities outstanding
  at that date.
Each share of Common Stock held by a shareholder entitled such shareholder to
  one vote on each matter that was voted upon at the Meeting. The presence, in
  person or by proxy, of the holders of a majority of the outstanding shares of
  Common Stock was necessary to constitute a quorum at the Meeting. Assuming that
  a quorum was present: (i) the affirmative vote of the holders of a majority
  of the shares of Common Stock outstanding was required to approve the proposed
  Amendment to effectuate the proposed Name Change to such name as may be approved
  by the Board of Directors in its sole and absolute discretion; (ii) the affirmative
  vote of the holders of a majority of the shares of Common Stock outstanding
  was required to approve the proposed Stock Option Plan; and (iii) the affirmative
  vote of the holders of a majority of the shares of Common Stock outstanding
  was required to ratify the prior actions of the shareholders taken pursuant
  to the March 25, 2003 Written Consent approving the Reverse Stock Split.
On August 8, 2003 the Meeting of shareholders was held with the resulting votes
  cast either in person or proxy as follows: (i) 822,251 votes FOR approval of
  the Amendment and 93 votes AGAINST approval of the Amendment; (ii) 732,782 votes
  FOR approval of the Stock Option Plan and 126 votes AGAINST approval of the
  Stock Option Plan; and (iii) 822,201 votes FOR ratification of the Reverse Stock
  Split and 118 votes AGAINST ratification of the Reverse Stock Split.
Moreover, on August 8, 2003 the shareholders of Transax Limited holding approximately
  92.16% of the issued and outstanding shares of common stock of Transax Limited
  approved the terms and conditions of the Merger Agreement and its related materials.

**PART II**Table of Contents**ITEM 5. Market for Common Equity and Related Stockholders Matters**Table of Contents
**Market Information**
The Company’s Common Stock is traded on the OTC Bulletin Board under the
  symbol "TNSX". The market for the Company’s Common Stock is
  limited, volatile and sporadic. The following table sets forth the high and
  low sales prices relating to the Company’s Common Stock for the last two
  fiscal years. These quotations reflect inter-dealer prices without retail mark-up,
  mark-down, or commissions, and may not reflect actual transactions.
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                      | **Fiscal Year Ended**
|--------------------- | ---------------------
|**December 31, 2003** | **December 31, 2002**
|                     
|**High**              | **Low**              
|First Quarter         | $5.20                
|Second Quarter        | $5.00                
|Third Quarter         | $3.90                
|Fourth Quarter        | $2.80                

|Holders
As of March 31th, 2004, the Company had approximately 298 shareholders of record.
Dividends
No dividends have ever been declared by the Board of Directors of the Company
  on its Common Stock. The Company’s previous losses do not currently indicate
  the ability to pay any cash dividends, and the Company does not indicate the
  intention of paying cash dividends on its Common Stock in the foreseeable future.
Reverse Stock Split
The Board of Directors of the Company, at a special meeting, authorized and
  approved, subject to shareholder approval, a reverse stock split of up to one-for-twenty
  of the Company’s issued and outstanding shares of Common Stock (the “Reverse
  Stock Split”). The matters upon which shareholder action was taken pursuant
  to the March 25, 2003 Written Consent included approval and authorization for
  the Board of Directors to effect the Reverse Stock Split, which was effected
  on approximately April 2, 2003. The Reverse Stock Split reduced the Company’s
  issued and outstanding shares of Common Stock from 22,532,110 shares to 1,106,701
  shares of Common Stock.

**Securities Authorized for Issuance under Equity Compensation Plans**
**Stock Option Plan**
On July 22, 2003, the Board of Directors unanimously approved and adopted a
  stock option plan (the "Stock Option Plan"), which was implemented
  by the Board of Directors on the Effective Date of the Merger Agreement. The
  purpose of the Stock Option Plan is to advance the interests of the Company
  and its shareholders by affording key personnel of the Company an opportunity
  for investment in the Company and the incentive advantages inherent in stock
  ownership in the Company. Pursuant to the provisions of the Stock Option Plan,
  stock options (the "Stock Options") will be granted only to key personnel
  of the Company, generally defined as a person designated by the Board of Directors
  upon whose judgment, initiative and efforts the Company may rely including any
  director, officer, employee or consultant of the Company. The Stock Option Plan
  replaced the stock option plan adopted by the Company effective March 25, 2003
  and its terms are identical to such stock option plan, except that the Stock
  Option Plan provides authorization to the Board of Directors to grant Stock
  Options to purchase a total number of shares of Common Stock of the Company
  no to presently exceed 4,500,000 shares.
The Stock Option Plan is to be administered by the Board of Directors of the
  Company, which shall determine (i) the persons to be granted Stock Options under
  the Stock Option Plan; (ii) the number of shares subject to each option, the
  exercise price of each Stock Option; and (iii) whether the Stock Option shall
  be exercisable at any time during the option period of ten (10) years or whether
  the Stock Option shall be exercisable in installments or by vesting only. The
  Stock Option Plan provides authorization to the Board of Directors to grant
  Stock Options to purchase a total number of shares of common stock of the Company,
  not to presently exceed 4,500,000 shares of Common Stock as at the date of adoption
  by the Board of Directors of the Stock Option Plan. At the time a Stock Option
  is granted under the Stock Option Plan the Board of Directors shall fix and
  determine the exercise price at which shares of common stock of the Company
  may be acquired; provided, however, that any such exercise price shall not be
  less than that permitted under the rules and policies of any stock exchange
  or over-the-counter market which is applicable to the Company.
In the event an optionee who is a director or officer of the Company ceases
  to serve in that position, any Stock Option held by such optionee generally
  may be exercisable within up to ninety (90) calendar days after the effective
  date that his position ceases, and after such 90-day period any unexercised
  Stock Option shall expire. In the event an optionee who is an employee or consultant
  of the Company ceases to be employed by the Company, any Stock Option held by
  such optionee generally may be exercisable within up to sixty (60) calendar
  days (or up to thirty (30) calendar days where the optionee provided only investor
  relations services to the Company) after the effective date that his employment
  ceases, and after such 60- or 30-day period any unexercised Stock Option shall
  expire.
No Stock Options granted under the Stock Option Plan will be transferable by
  the optionee, and each Stock Option will be exercisable during the lifetime
  of the optionee subject to the option period of ten (10) years or limitations
  described above. Any Stock Option held by an optionee at the time of his death
  may be exercised by his estate within one (1) year of his death or such longer
  period as the Board of Directors may determine.
Unless restricted by the option agreement, the exercise price shall by paid
by any of the following methods or any combination of the following methods:
(i) in cash; (ii) by cashier's check, certified cheque, or other acceptable
banker's note payable to the order of the Company; (iii) by net exercise
notice whereby the option holder will authorize the return to the Stock
Option Plan pool, and deduction from the option holder's Stock Option, of
sufficient Stock Option shares whose net value (fair value less option
exercise price) is sufficient to pay the option price of the shares exercise
(the fair value of the shares of the Stock Option to be returned to the pool
as payment will be determined by the closing price of the Company's shares
of Common Stock on the date notice is delivered); (iv) by delivery to the
Company of a properly executed notice of exercise together with irrevocable
instructions (referred to in the industry as 'delivery against payment') to
a broker to deliver to the Company promptly the amount of the proceeds of
the sale of all or a portion of the stock or of a loan from the broker to
the option holder necessary to pay the exercise price; of (v) such other
method as the option holder and the Board of Directors may determine as
adequate including delivery of acceptable securities (including securities
of the Company), set-off for wages or invoices due, property, or other
adequate value. In the discretion of the Board of Director, the Company may
grant a loan or guarantee a third-party loan obtained by an option holder to
pay part of all of the exercise option price of the shares provided that
such loan or the Company's guaranty is secured by the shares of Common
Stock.
Incentive Stock Options
  The Stock Option Plan further provides that, subject to the provisions of
    the Stock Option Plan and prior shareholder approval, the Board of Directors
    may grant to any key personnel of the Company who is an employee eligible
    to receive options one or more incentive stock options to purchase the number
    of shares of Common Stock allotted by the Board of Directors (the "Incentive
    Stock Options"). The option price per share of Common Stock deliverable
    upon the exercise of an Incentive Stock Option shall be no less than fair
    market value of a share of Common Stock on the date of grant of the Incentive
    Stock Option. In accordance with the terms of the Stock Option Plan, "fair
    market value" of the Incentive Stock Option as of any date shall not
    be less than the closing price for the shares of Common Stock on the last
    trading day preceding the date of grant. The option term of each Incentive
    Stock Option shall be determined by the Board of Directors, which shall not
    commence sooner than from the date of grant and shall terminate no later than
    ten (10) years from the date of grant of the Incentive Stock Option, subject
    to possible early termination as described above.
  Form S-8 – Registration Statement
  In accordance with the Company’s Stock Option Plan, on August 26, 2003,
    the Company filed with the Securities and Exchange Commission a registration
    statement on "Form S-8 - For Registration Under the Securities Act of
    1933 of Securities to Be Offered to Employees Pursuant to Employee Benefit
    Plans" registering the Stock Options and Incentive Stock Options under
    the Stock Option Plan in the amount of up to 4,500,000 at various exercise
    prices. In accordance with receipt of shareholder approval of the Stock Option
    Plan, the Board of Directors is authorized, without further shareholder approval,
    to grant such Stock Options from time to time to acquire up to an aggregate
    of 4,500,000 shares of the Company’s Common Stock.
  
  Stock Options Granted and Exercised
  In accordance with the terms and provisions of the Stock Option Plan, and
    as of the date of this Annual Report, the Board of Directors of the Company
    has granted an aggregate of 4,500,000 Stock Options (which have been reduced
    pursuant to exercises and/or forfeitures as described below) as follows: (i)
    2,500,000 Stock Options exercisable at $0.50 per share to IMT as a previous
    holder of stock options of Transax Limited to replace stock options previously
    granted by Transax Limited (on the basis of each two Transax Limited stock
    options exchanged into one Stock Option of the Company); and (ii) 2,000,000
    Stock Options exercisable at $0.50 per share to previous holders of stock
    options of Transax Limited to replace stock options previously granted by
    Transax Limited (on the basis of each two Transax Limited stock options exchanged
    into one Stock Option of the Company).
  Of the 2,500,000 aggregate Stock Options granted to IMT: (i) 1,206,730 Stock
    Options have been exercised at $0.50 per share in settlement of debt due and
    owing to ICI in the approximate amount of $652,000.00 and the subsequent assignment
    of such debt as described below by certain consultants/employees of IMT in
    accordance with the terms of the respective notice and agreement of exercise
    of option; and (ii) 1,293,270 Stock Options granted to IMT were cancelled
    by the Company.
  On October 1, 2003, in accordance with the terms and provisions of the Stock
    Option Plan, the Board of Directors of the Company granted an aggregate of
    1,293,270 Stock Options (which had previously been granted to IMT, and then
    cancelled as detailed above) as follows: (i) 1,293,270 Stock Options exercisable
    at $0.50 per share to Asia Pacific. Of the 1,293,270 Stock Options granted
    to Asia Pacific, (i) 87,500 Stock Options have been exercised at $0.50 per
    share in settlement of debt due and owing to Asia Pacific in the approximate
    amount of $43,750 in accordance with the terms of the respective notice and
    agreement of exercise of option; and (ii) 1,205,770 Stock Options granted
    to Asia Pacific were cancelled by the Company.
  On December 1, 2003, in accordance with the terms and provisions of the Stock
    Option Plan, the Board of Directors of the Company granted an aggregate of
    1,205,770 Stock Options (which had previously been granted to Asia Pacific,
    and then cancelled as detailed above) as follows: (i) 1,205,770 Stock Options
    exercisable at $0.25 per share to Asia Pacific. Of the 1,205,770 Stock Options
    grated to Asia Pacific: (i) 162,500 Stock Options have been exercised at $0.25
    per share in settlement of debt due and owing to Asia Pacific in the approximate
    amount of $40,625 in accordance with the terms of the respective notice and
    agreement of exercise of option; (ii) 300,000 Stock Options have been exercised
    at $0.25 per share in settlement of debt due and owing to Asia Pacific in
    the approximate amount of $75,000 in accordance with the terms of the respective
    notice and agreement of exercise of option; and (iii) 300,000 Stock Options
    have been exercised at $0.25 per share in settlement of debt due and owing
    to Asia Pacific in the approximate amount of $75,000 in accordance with the
    terms of the respective notice and agreement of exercise of option.
  As of the date of this Annual Report, an aggregate of 2,056,730 Stock Options
    have been exercised as described above and the Company has issued an aggregate
    of 2,056,730 shares of its Common Stock to such optionees.

Common Stock Purchase Warrants
Merger Agreement
  Pursuant to the terms of the Merger Agreement, the Company issued an aggregate
    of 4,100,000 share purchase warrants (the “Warrant(s)”), pursuant
    to which the holder thereof has the right to convert such Warrant into shares
    of Common Stock on a one-to-one basis at the rate of $1.00 per share expiring
    on August 8, 2008 (on the basis of each two Transax Limited share purchase
    warrants exchanged into one Warrant of the Company).
  ICI Warrants
  During fiscal year ended December 31, 2003, an aggregate of $752,100.00 in
    fees and various expenses was incurred by ICI and its assignees on behalf
    of the Company for services rendered pursuant to its previous consulting services
    arrangement and pursuant to the ICI Consulting Services Agreement (collectively,
    the “Debt”). As of September 30, 2003, the Debt was settled pursuant
    to the terms and provisions of the ICI Settlement Agreement. Pursuant to the
    terms and provisions of the ICI Settlement Agreement: (i) ICI agreed to settle
    a portion of the Debt by entering into respective assignment agreements with
    certain Designates; (ii) the Company agreed to accept the assignment by such
    Designate of that certain receivable as consideration for the payment of the
    exercise of the Stock Options granted to IMT and/or its employees or consultants
    at $0.50 per option to acquire shares of Common Stock of the Company; and
    (iii) the Company agreed to issue the shares of Common Stock in the name of
    the Designate in accordance with the respective notice and agreement of exercise
    of option. Therefore, an aggregate of 1,206,730 Stock Options were exercised
    at $0.50 per option in settlement of $652,071of the Debt.
  The balance of the Debt was satisfied pursuant to issuance by the Company
    to ICI of an aggregate of 100,000 units at a price of $1.00 per unit (the
    “Unit”), with each Unit comprised of one share of Common Stock
    of the Company and one half non-transferable warrant (the “ICI Warrant(s)”).
    ICI has the right to convert such ICI Warrant into shares of Common Stock
    on a one-to-one basis at the rate of $1.50 per share expiring on August 26,
    2004.
  Convertible Loan Warrants
  On December 31, 2002, Transax Limited borrowed $66,195 from a related party.
    On March31, 2003, Transax Limited borrowed $255,000 from this related party,
    and a further $100,000 on April 30, 2003.
  During the year ended December 31, 2003, the Company incurred approximately
    $41,300 in interest. Each loan is repayable on or before a six-month term.
    The interest rate is 12% per annum compounded monthly. The lender shall have
    the option during the term of the loan, and any extension thereto, to convert
    the principal and interest into common stock of TNSX, at a conversion price
    of $0.25 per unit. Each unit is comprised of one common share and one warrant.
    Each warrant entitles the holder to purchase an additional share of the Company’s
    common stock at $0.50, for a period of twelve months.
  On December 31, 2003, the loan and accrued interest of $93,400 were converted for 373,570 units.
  At December 31, 2003, the loans for $255,000 and $100,000 were in default,
    and the holder of the notes has not exercised the conversion feature. At December
    31, 2003, $32,818 in interest was accrued on these two loans. As of the date
    of this Annual Report, in the event the related party elects to convert the
    aggregate amount of $387,818 due and owing into Units, a total of 1,551,272
    Convertible Loan Warrants would be issued and outstanding. The 1,551,272 Convertible
    Loan Warrants would be convertible into 1,551,272 shares of Common Stock of
    the Company at an exercise price of $0.50 per share. 
    As of the date of this Annual Report, there are an aggregate of 4,748,570
    share purchase warrants issued and outstanding as follows: (i) 4,100,000 Warrants
    convertible into 4,100,000 shares of Common Stock at the price of $1.00 per
    share expiring on August 14, 2008; (ii) 50,000 ICI Warrants convertible into
    50,000 shares of Common Stock at the price of $1.50 per share expiring on
    August 26, 2004, 2004; (iii) 225,000 Warrants convertible into 225,000 shares
    of Common Stock at the price of $1.00 per share expiring on November 20, 2005;
    and (iv) 373,570 Warrants convertible into 373,570 shares of Common Stock
    at the price of $0.50 per share expiring on December 31, 2004. In the event
    the convertible loans are converted into Units, an additional 1,551,272 Convertible
    Loan Warrants convertible into 1,551,272 shares of Common Stock at the price
    of $0.50 per share would be included. As of the date of this Annual Report,
    none of the Warrants nor the ICI Warrants have been converted.
Equity Compensation Plan Information
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                                                                                                                                                                                                                                | **Number of Securities to be Issued Upon the Exercise of Outstanding Options, Warrants and Rights**
				(a) | **Weighted-average Price of Outstanding Options, Warrants and Rights**
				(b) | **Number of Securities Remaining Available for Future Issuance under Equity Compensation Plan (excluding column (a))
				(c)**
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------ | ------------------------------------------------------------------------------------------------------------------------------
|Equity Compensation Plans Approved by Security Holders                                                                                                                                                                                          | n/a                                                                                                         | n/a                                                                            | n/a                                                                                                                           
|Equity Compensation Plans Not Approved by Security Holders - Warrants                                                                                                                                                                           | 4,100,000                                                                                                   | $1.00                                                                          | -0-                                                                                                                           
|Equity Compensation Plans Not Approved by Security Holders - ICI Warrants                                                                                                                                                                       | 50,000                                                                                                      | $1.50                                                                          | -0-                                                                                                                           
|Equity Compensation Plans Not Approved by Security Holders - Warrants                                                                                                                                                                           | 225,000                                                                                                     | $1.00                                                                          | -0-                                                                                                                           
|Equity Compensation Plans Not Approved by Security Holders - Converted Loan Warrants                                                                                                                                                            | 373,570                                                                                                     | $0.50                                                                          | -0-                                                                                                                           
|Equity Compensation Plans Not Approved by Security Holders - Convertable Loans Warrants                                                                                                                                                         | 1,551,272                                                                                                   | $0.50                                                                          | -0-                                                                                                                           
|**Total**                                                                                                                                                                                                                                       | 4,748,570*                                                                                                  |                                                                                |                                                                                                                               
|* Does not include the 1,551,272 Convertible Loans Warrants.  As of the date of this Annual
				Report, the related party as lender has not elected to convert the aggregate amount due and
				owing into units of the capital of the Company.

|**Recent Sales of Unregistered Securities and Changes in Control of the
  Company**
As of the date of this Annual Report and during fiscal year ended December 31,
  2003, to provide capital, the Company sold stock in private placement offerings,
  issued stock in exchange for debts of the Company or pursuant to contractual
  agreements as set forth below. Therefore, there was a change in control of the
  Company. See “Item 11. Security Ownership of Certain Beneficial Owners
  and Management.”

ICI Settlement Agreement
Exercise of Stock Options
  On September 30, 2003, the Company and ICI entered into the ICI Settlement
    Agreement pursuant to which an aggregate of $752,070.91 due and owing to ICI
    (the “Debt”) was satisfied by the Company. Pursuant to the terms
    and provisions of the ICI Settlement Agreement: (i) ICI agreed to settle a
    portion of the Debt by entering into respective assignment agreements with
    certain Designates; (ii) the Company agreed to accept the assignment by such
    Designate of that certain receivable as consideration for the payment of the
    exercise of the Stock Options granted to IMT and/or its employees or consultants
    at $0.50 per option to acquire shares of Common Stock of the Company; and
    (iii) the Company agreed to issue the shares of Common Stock in the name of
    the Designate in accordance with the respective notice and agreement of exercise
    of option.
  During fiscal year ended December 31, 2003, an aggregate of 1,206,730 Stock
    Options were exercised at $0.50 per option by such Designates and the Company
    issued an aggregate of 1,206,730 shares of Common Stock to such Designates
    as partial settlement of the Debt.
  Private Placement
  The balance of the Debt was satisfied pursuant to issuance by the Company
    to ICI of an aggregate of 100,000 Units, with each Unit comprised of one share
    of Common Stock of the Company and one half ICI Warrant. ICI has the right
    to convert such ICI Warrant into shares of Common Stock on a one-to-one basis
    at the rate of $1.50 per share expiring on September 30, 2004. The per share
    price of the shares of Common Stock was arbitrarily determined by the Board
    of Directors based upon analysis of certain factors including, but not limited
    to, stage of development, perceived investment risks, assets and net estimated
    worth of the Company. The Company issued 100,000 shares of Common Stock to
    ICI. ICI executed the Settlement Agreement and acknowledged therein that the
    securities to be issued have not been registered under the Securities Act
    of 1933, as amended, that ICI understood the economic risks of an investment
    in the securities, and that ICI had the opportunity to ask questions of and
    receive answers from the Company’s management concerning any and all
    matters related to acquisition of the securities.
Merger Agreement
Pursuant to the terms and conditions of the Merger Agreement and a corresponding
  contribution agreement as entered into between the Company and Vega-Atlantic,
  on the Effective Date: (i) the Company contributed to Vega-Atlantic 11,066,207
  shares of its restricted Common Stock and 4,500,000 stock options and 4,100,000
  share purchase warrants to acquire any equivalent number of shares of Common
  Stock of the Company. Therefore, Vega-Atlantic exchanged therefore with all
  Transax Limited shareholders an aggregate of 11,066,207 shares of restricted
  Common Stock of the Company (on the basis of each two Transax Limited shares
  of common stock exchanged into one share of Common Stock of the Company.

**ITEM 6. Management’s Discussion and Analysis or Plan of Operation**Table of Contents
The following discussions of the results of operations and financial position
  of the Company should be read in conjunction with the financial statements and
  notes pertaining to them that appear elsewhere in this Form 10-KSB.
**Results of Operations**
On September 22, 2003 the Board of Directors of the Company approved a change
  in fiscal year end of the Company from March 31st to a calendar year-end of
  December 31st. The Board of Directors’ decision to change the fiscal year
  end was based upon consummation of the Merger Agreement and the resulting continuation
  of the corporate entity Transax under the Merger, which has a calendar fiscal
  year end. The date of the Company’s fiscal year end is December 31, 2003.
  Therefore, this Annual Report on Form 10-KSB for the year ended December 31,
  2003 covers such transition period. 
  As of the date of this Annual Report, management of the Company believes that
  the Company is in a viable operational position. Management of the Company also
  believes that the Health Information Management Products are integrated systems
  that will increase the Company’s marketability exponentially. During fiscal
  year ended December 31, 2003, sales of the Company’s products to customers
  accounted for approximately 100% of total gross revenues. Although the Company
  intends to expand its marketing of the Health Information Management Products
  in other countries, management believes that the sales of such products to customers
  in Brazil will continue to be a substantial line of business for the Company
  for the next several years. 
  The accompanying audited consolidated financial statements of the Company present
  the accounts of Transax Limited from May 2, 1998 [Inception] to December 31,
  and the accounts of TNSX from the Effective Date of the Merger to December 31,
  2003 and the results of operations of Transax Limited for the comparative year
  ended December 31, 2002.

For Fiscal Year December 31, 2003 Compared with Fiscal Year Ended December
  31, 2002
The Company incurred net losses of approximately ($3,230,300) for the year ended
  December 31, 2003 ($0.25 per share), compared to a net loss of approximately
  ($2,116,900) ($0.17 per share) for the year ended December 31, 2002. 

  Comparative results for the year ended December 31, 2002 include only the results
  of Transax Limited and it’s wholly owned subsidiary TDS. Results for the
  current period include the operations of Transax and its subsidiaries, and also
  of the Company from the Effective Date of the Merger to December 31, 2003.
During the year ended December 31, 2003, the Company generated approximately $309,600 in gross
  revenues compared to approximately $51,600 in gross revenues during the year ended December
  31, 2002. The significant increase in revenues is due to the marketing and sale
  of the Company’s products pursuant to new software contracts in Brazil.
During fiscal year ended December 31, 2003, the Company recorded operating expenses
  of approximately $3,352,000 compared to operating expenses of approximately $1,796,700 incurred during fiscal
  year ended December 31, 2002. During fiscal year ended December 31, 2003, the
  Company’s operating expenses consisted primarily of: (i) $1,210,100 (2002 - $nil) in
  stock based compensation; (ii) approximately $397,900 (2002 - $426,200) in cost of product support services;
  (iii) approximately $302,500 (2002 - $344,900) in payroll and related benefits; (iv) approximately $385,600 (2002 - $174,700) in professional
  fees; (v) approximately $398,200 (2002 - $144,800) in management and consulting fees to related parties; (vi)
  approximately $162,900 (2002 - $nil) in investor relation fees; (vii) approximately $106,200 (2002 - $27,000) in depreciation expense;
  and (viii) approximately $364,200 (2002 - $232,900) in general and administrative expenses. General and administrative
  expenses generally include corporate overhead, financial and administrative
  contracted services and consulting costs.
During the year ended December 31, 2003, stock-based compensation increased
  to $1,210,100 from $-0- during the year ended December 31, 2003 compensation
  due to the issuance of stock options and warrants to non-employees for certain
  services performed. Professional fees increased to approximately $385,600 (2002 - $174,700).
  The increase in professional fees during the year ended December 31, 2003 is
  primarily due to an increase in expenses relating to the merger of Transax with
  TDS, and subsequent merger of Transax with the Company in 2003. During the year
  ended December 31, 2003, the Company’s professional fees consisted of:
  (i) approximately $89,800 (2002 - $nil) in audit and accounting fees; (ii) approximately $241,500 (2002 - $65,100) in legal fees; (iii)
  approximately $16,700 (2002 - $49,000) in monitor fees; and (iv) approximately $37,600 (2002 - $60,600) in management fees. Related party
  management and consulting fees also increased to approximately $398,200 (2002 - $144,800)
  due to the comparative data for 2002 which included only the related party management
  fees for TDS, while in 2003 it included the related party management fees for
  TDS, Transax and the Company. General and administrative expenses increased
  during the year ended December 31, 2003 to approximately $364,200 (2002 - $232,900) due to
  an increase in support services required to maintain operations. On January
  1, 2003, the Company changed the estimated useful lives of certain assets in
  order to reflect better the current circumstances. During the year ended December
  31, 2003, the Company incurred approximately $106,200 in depreciation expenses
  compared to approximately $26,900 for the year ended December 31, 2002. 
  During the year ended December 31, 2003, payroll and related benefits
  decreased to approximately $302,600 (2002 - $344,900), due to certain changes in staff contracts
  in Brazil. Although there has been new staff due to an increase in the workload
  required to properly support the current and anticipated products sales, costs
  have decreased because certain employees have elected to enter into a contractual
  agreement as opposed to being on payroll. The cost of product support services
  also approximately decreased moderately from approximately $426,200 for the year ended December 31, 2002
  to approximately $397,900 for the year ended December 31, 2003. The increase in number of
  staff on contract has been off set by the decrease in costs of software development.
  In 2002, research and development costs were expensed as incurred. During the
  year ended December 31, 2003, certain software development costs were capitalized,
  and then amortized based on the current and future revenue for each product.
  Approximately $24,400 in amortization of the development costs was charged to
  operations for the year ended December 31, 2003 (2002 : $Nil).
As discussed above, this resulted in an operating loss of approximately ($3,042,400) for the
  year ended December 31, 2003 compared to an operating loss of approximately ($1,745,100) for
  the year ended December 31, 2002.
During the year ended December 31, 2003, the Company’s other expenses
  in the amount of approximately ($187,800) compared to approximately ($371,700) during the year ended December
  31, 2002. Other expenses incurred during the year ended December 31, 2003 primarily
  consisted of: (i) interest expense of approximately $86,000 (2002 - $29,400); (ii) interest expense of approximately $65,000 (2002 - $132,200)
  to a related party due to the conversion of certain cash advances into interest
  bearing convertible loans and certain cash advances bearing interest; and (iii)
  approximately $6,500 (2002 - $210,100) in foreign exchange due to unfavorable foreign exchange adjustments.
As a result of these factors, net loss for the year ended December 31, 2003
  was approximately ($3,230,300) or ($0.25) per common share compared to a net loss of approximately ($2,116,900)
  or ($0.17) per common share during the year ended December 31, 2002. The weighted
  average number of shares of Common Stock outstanding were 12,953,494 at December
  31, 2003 compared to 12,472,917 at December 31, 2002.

**Liquidity and Capital Resources**
The Company generated approximately $309,600 in gross revenues during the year ended December
  31, 2003, an increase from gross revenues of approximately $51,600 generated during the year
  ended December 31, 2002. Management of the Company anticipates that overall
  generation of revenues will continue to increase on an annual basis based on
  existing contracts. However, since inception, the Company has incurred cumulative
  net losses of approximately $6,687,700 and has a stockholders’ deficit
  of approximately $1,621,500 as at December 31, 2003. The Company expects to
  continue to incur substantial losses to develop its products and distribution
  networks, and does not expect to attain profitability in the near future. Since
  its inception, the Company has funded operations through short-term borrowings
  and equity investments in order to meet its strategic objectives. The Company's
  future operations are dependent upon external funding and its ability to increase
  revenues and reduce expenses. Management believes that sufficient funding will
  be available from additional related party borrowings and private placements
  following its merger to meet its business objectives including anticipated cash
  needs for working capital, for a reasonable period of time. However, there can
  be no assurance that the Company will be able to obtain sufficient funds to
  continue the development of its software products and distribution networks.
The Company's financial statements have been prepared assuming that it will
  continue as a going concern and, accordingly, do not include adjustments relating
  to the recoverability and realization of assets and classification of liabilities
  that might be necessary should the Company be unable to continue in operation.
Fiscal Year Ended December 31, 2003
As at December 31, 2003, the Company’s current assets were approximately $36,100 (2002 - $36,300) and
  its current liabilities were approximately $1,857,300 (2002 - $694,600), which resulted in a working capital
  deficit of approximately $1,821,200 (2002 - $658,300). Current assets consisted of approximately $10,500 (2002 - $31,100) in cash and approximately $25,600 (2002 - $5,100)
  in prepaid expenses. Current liabilities consisted of: (i) approximately $477,200 (2002 - $141,700) in accounts
  payable and accrued expenses; (ii) approximately $409,200 (2002 - $255,600) in accrued payroll and related expenses;
  (iii) approximately $387,800 (2002 - $66,200) in convertible loans from related party; (iv) approximately $384,500 (2002 - $194,000) due to
  related party; (v) approximately $152,600 (2002 - $nil) in advances payable; and (vi) approximately $46,000 (2002 - $37,100) in current
  portion of capital lease obligation.
As at December 31, 2003, the Company’s total assets were approximately $249,100 (2002 - $175,100) and
  its total liabilities were approximately $1,870,600 (2002 - $721,700). The Company’s total liabilities
  exceeded its total assets by approximately $1,621,500. As at December 31, 2003, the Company’s
  total assets consisted of: (i) approximately $36,100 (2002 - $36,300) in current assets; (ii) approximately $110,300 (2002 - $nil) in software
  development costs; and (iii) approximately $102,700 (2002 - $138,900) in property and equipment. As at December
  31, 2003, the Company’s total liabilities consisted of: (i) approximately $1,857,300 (2002 - $694,600)
  in current liabilities; and (ii) approximately $13,300 (2002 - $27,100) in capital lease obligation (net of
  current portion due).
The Company’s stockholders’ deficit was ($1,621,500) at December
  31, 2003.
For the year ended December 31, 2003, net cash flows used in operating activities
  were approximately $1,097,700 compared to approximately $1,777,400 for the year ended December
  31, 2002.  Net cash used in operating activities was primarily comprised of : (i) net loss of approximately ($3,230,300);
(ii) stock based compensation of approximately $1,210,100; (iii) accounts payable of approximately $435,500; (iv)
due to related party of approximately $196,100; and (v) accrued payroll and related expenses of approximately $153,500.
Net cash flows from financing activities during the year ended December 31,
  2003 were approximately $1,319,600 resulting primarily from loans and advances from a related
  party and non-related company, compared to approximately $1,564,900 during the year ended December 31, 2002. The borrowings
  were used to fund operating activities.
Net cash flows used in investing activities amounted to approximately $178,400
  during the year ended December 31, 2003, compared to $NIL for the year ended
  December 31, 2002. During the year ended December 31, 2003, the Company capitalized
  some of its software research and development costs, while in 2002, these costs
  were expensed as part of the costs of product support services.
In summary, based upon the cash flow activities as previously discussed, during
  the year ended December 31, 2003, the Company’s overall cash position
  decreased by approximately $20,600.

**Plan of Operations**
Notwithstanding consummation of the Merger Agreement, as of the date of this
  Annual Report, there is substantial doubt regarding the Company's ability
  to continue as a going concern as the Company has not generated sufficient cash
  flow to fund its business operations and material commitments. The Company's
  future success and viability, therefore, are dependent upon the Company’s
  ability to develop, provide and market its anticipated information network solutions
  to healthcare providers, health insurance companies and other end-users, and
  the continuing ability to generate capital financing. Management is optimistic
  that the Company will be successful in its business operations and capital raising
  efforts; however, there can be no assurance that the Company will be successful
  in generating revenue or raising additional capital. The failure to generate
  sufficient revenues or raise additional capital may have a material and adverse
  effect upon the Company and its shareholders.
Based upon consummation of the Merger, management of the Company anticipates
  an increase in operating expenses over the next three years to pay costs associated
  with such business operations. The Company must raise additional funds. The
  Company may finance these expenses with further issuances of Common Stock of
  the Company. The Company believes that any anticipated private placements of
  equity capital and debt financing, if successful, may be adequate to fund the
  Company’s operations over the next twelve months. Thereafter, the Company
  expects it will need to raise additional capital to meet long-term operating
  requirements. If the Company raises additional funds through the issuance of
  equity or convertible debt securities other than to current shareholders, the
  percentage ownership of its current shareholders would be reduced, and such
  securities might have rights, preferences or privileges senior to its existing
  Common Stock. In addition, additional financing may not be available upon acceptable
  terms, or at all. If adequate funds are not available, or are not available
  on acceptable terms, the Company may not be able to conduct its business operations
  successfully, which could significantly and materially restrict the Company’s
  overall business operations.
Based upon a twelve-month work plan proposed by management, it is anticipated
  that such a work plan would require approximately $2,000,000 of financing designed
  to fund various commitments and business operations. As of the date of this
  Annual Report, management believes that the Company can satisfy its cash requirements
  for the next twelve months based on its ability to successfully
  raise capital and to obtain advances from certain investors and related parties,
  as necessary. The Company’s future success and viability are primarily
  dependent upon the Company’s current management to generate revenues from
  business operations and raise additional capital through further private offerings
  of its stock or loans from private investors. There can be no assurance, however,
  that the Company will be able to raise additional capital. The Company’s
  failure to successfully raise additional capital will have a material and adverse
  affect upon the Company and its shareholders.

**Service Agreements**
In connection with the management of the Company and/or its subsidiary incurred
  liability or borrowed funds pursuant to various contractual arrangements representing
  the following service agreement.
Walters Consulting Agreement
A significant and estimated service agreement for the Company for fiscal year
  2004 is the aggregate amount of $132,000.00 to be paid to Mr. Walters pursuant
  to the Walters Consulting Agreement. Pursuant to the terms and provisions of
  the Walters Consulting Agreement: (i) Mr. Walters agreed to provide technical,
  research and technology development services to the Company; and (ii) Mr. Walters
  shall be paid a monthly fee of $11,000.00 US Dollars for a potential annual
  salary of $132,000.00, and reimbursement of expenses. See “Item 10. Executive
  Compensation” and “Item 12. Certain Relationships and Related Transactions.”

Pilon Consulting Agreement
A significant and estimated service agreement for the Company for fiscal year
  2004 is the aggregate amount of $90,000 to be paid to Ms. Pilon pursuant to
  the Pilon Consulting Agreement. Pursuant to the terms and provisions of the
  Pilon Consulting Agreement: (i) Ms. Pilon agreed to provide financial, administrative
  and managerial services to the Company; and (ii) Ms. Pilon shall be paid a monthly
  fee of $7,500.00 US Dollars for a potential annual salary of $90,000, and reimbursement
  of expenses. See “Item 10. Executive Compensation” and “Item
  12. Certain Relationships and Related Transactions.”
De Castro Consulting Agreement
A significant and estimated material commitment for the Company for fiscal year
  2004 is the aggregate amount of $96,000.00 to be paid to Mr. De Castro pursuant
  to the De Castro Consulting Agreement. Pursuant to the terms and provisions
  of the De Castro Consulting Agreement: (i) Mr. De Castro agreed to provide technical,
  research and developmental services to the Company’s subsidiary; and (ii)
  Mr. De Castro shall be paid a monthly fee of $8,000.00 US Dollars for an aggregate
  annual salary of $96,000.00, and reimbursement of expenses.
**Material Operating Liabilities**
	Convertible Loans
A significant and estimated material commitment for the Company for fiscal year
  2004 is the aggregate amount of $387,800 in principal and interest due and owing
  to a related party. On December 31, 2002, Transax Limited borrowed $66,195 from
  such related party. On March 31, 2003, Transax Limited borrowed $255,000 from
  this related party, and a further $100,000 on April 30, 2003. Each principal
  amount loan is evidenced by a convertible promissory note and is repayable on
  or before a six-month term. The interest rate is 12% per annum compounded monthly.
  The related party as the lender has the option during the term of the loan,
  and any extension thereto, to convert the principal and interest into units
  in the capital of the Company at a conversion price of $0.25 per unit (the “Unit”).
  Each Unit is comprised of one share of restricted Common Stock of the Company
  and one warrant, and each warrant entitles the holder thereof to purchase one
  share of restricted Common Stock of the Company at $0.50 per share for a period
  of twelve months. 

  On December 31, 2003, the loan and accrued interest of $93,000 were converted for 373,570 common shares and warrants.

At December 31, 2003, the loans for $255,000 and $100,000 were in default,
  and the holder of the notes has not exercised the conversion feature. At December
  31, 2003, $32,818 in interest was accrued on these two loans.
Cash Advances from Related Party
A significant and estimated material commitment for the Company for fiscal year
  2004 is the aggregate amount of $188,400 in cash advances due and owing to a
  related party. During fiscal year ended December 31, 2003, such related party
  advanced approximately $ $839,405 for working capital purposes. During the year,
  this party converted $355,000 of advances into loans and $495,200 of advances
  into 5,980,797 pre-merger common shares of Transax Limited. As per the terms
  of the Merger, these shares were subject to a 2:1 reverse split, and were then
  exchanged for common shares of the Company. The advances due and owing at December
  31, 2003 were non-interest bearing until August 31, 2003, and are accruing 1%
  interest per month since September 1, 2003.
Cash Advances
During the year ended December 31, 2003, the Company has received cash advances
  from a non-related company of $526,500 for working capital purposes.
  During the year, the lender converted $225,000 of advances into 450,000 units.
  Each unit is comprised of one common share and one half warrant. Each warrant
  entitles the holder to purchase an additional share of TNSX’s common stock
  at $1.00, for a period of 24 months.
During the year, the Company also issued 550,000 common shares for the settlement
  of $159,375 in cash advances. These remaining advances are accruing 1% interest
  per month, starting September 1, 2003. At December 31, 2003, approximately $152,600
  in advances and accrued interest were due to this company.
Accrued Payroll and Related Expenses
A significant and estimated material commitment for the Company for fiscal year
  2004 is the aggregate amount of $298,600, including a provision of interest
  and fines of approximately $61,700, due and owing for Brazilian payroll taxes
  and Social Security taxes.

**Off-Balance Sheet Arrangements**
As of the date of this Annual Report, the Company does not have any off-balance
  sheet arrangements that have or are reasonably like to have a current or future
  effect on the Company’s financial condition, changes in financial condition,
  revenues or expenses, results of operations, liquidity, capital expenditures
  or capital resources that are material to investors. The term “off-balance
  sheet arrangement” generally means any transaction, agreement or other
  contractual arrangement to which an entity unconsolidated with the Company is
  a party, under which the Company has (i) any obligation arising under a guarantee
  contract, derivative instrument or variable interest; or (ii) a retained or
  contingent interest in assets transferred to such entity or similar arrangement
  that serves as credit, liquidity or market risk support for such assets.
	**Critical Accounting Policies**

The discussion and analysis of our financial condition and results of
operations is based upon our consolidated financial statements, which have
been prepared in accordance with generally accepted accounting principles or
GAAP in the United States. The preparation of those financial statements
requires us to make estimates and judgments that affect the reported amount
of assets and liabilities at the date of our financial statements. Actual
results may differ from these estimates under different assumptions or
conditions.

Critical accounting policies are those that reflect significant judgments or
uncertainties, and potentially result in materially different results under
different assumptions and conditions. The Company believes that are our most
critical accounting policies includes: recognition of transactions revenues
and accounting for stock options and warrants.Revenue Recognition
The Company generates is revenues from contracts which generally last more than
  one year. There are two principal services in the contract that produce revenues.
  The first is the installation of the Medlink Solutions software at the locations
  of healthcare providers. This revenue is recognized in accordance with Statement
  of Position (“SOP”) 98-7 when: (1) persuasive evidence of an arrangement
  exists; (2) delivery has occurred; (3) the Company’s fee is fixed and
  determinable, and; (4) collectibility is probable. The second source of revenue
  is the fee charged for each transaction processed through the Medlink Solutions
  system. These fees are invoiced after the transactions are processed.
Accounting for Stock-Based Compensation
The Company accounts for stock-based employee compensation arrangements in accordance
  with the provisions of Accounting Principles Board (“APB”) Opinion
  No. 25, Accounting for Stock Issued to Employees, and complies with the disclosure
  provisions of SFAS No. 123, Accounting for Stock-Based Compensation. Under APB
  No. 25, compensation expense is recognized based on the difference, if any,
  on the date of grant between the estimated market value of the Company’s
  stock and the amount an employee must pay to acquire the stock. Compensation
  expense is recognized immediately for past services and ratably for future services
  over the option-vesting period. If the Company followed SFAS 123, it would recognize
  compensation expense using a fair value method, such as Black-Scholes, to estimate
  the cost of equity instruments as of the date these awards are granted to employees.
  Any differences between the expense as calculated under SFAS 123 and that computed
  under APB No. 25 is disclosed on a pro forma basis in the notes to the consolidated
  financial statements.
The Company accounts for equity instruments issued in exchange for the receipt
  of goods or services from other than employees in accordance with SFAS No. 123
  and the conclusions reached by the Emerging Issues Task Force (“EITF”)
  in Issue No. 96-18, Accounting for Equity Instruments That Are Issued to Other
  Than Employees for Acquiring or in Conjunction with Selling, Goods or Services.
  Costs are measured at the estimated fair market value of the consideration received
  or the estimated fair value of the equity instruments issued, whichever is more
  reliably measurable. The value of equity instruments issued for consideration
  other than employee services is determined on the earlier of a performance commitment
  or completion of performance by the provider of goods or services as defined
  by EITF No. 96-18.

	
**ITEM 7. Financial Statements**Table of Contents
The information required under Item 310(a) of Regulation S-B is included in
  this report as set forth in the "Index to Financial Statement".
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

---

|**INDEX OF FINANCIAL STATEMENTS**
		Back to Table of Contents
		Report of Independent AuditorsConsolidated Balance Sheet at December 31, 2003Consolidated Statements of Operations for the years ended December 31, 2003 and 2002, and for
			the period from May 2, 1998 [Inception] to December 31, 2003Consolidated Statements of Stockholders' Equity [Deficit] for the period from May 2, 1998 [Inception]
			to December 31, 2003Consolidated Statements of Cash Flows for the years ended December 31, 2003 and 2002, and for the period
			from May 2, 1998 [Inception] to December 31, 2003Notes to the Consolidated Financial Statements
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

---

|**REPORT OF INDEPENDENT AUDITORS**
Back to Index of Financial StatementsBack to Table of Contents


To the Board of Directors and Stockholders' of Transax International Limited.

We have audited the accompanying consolidated balance sheet of Transax International Limited and subsidiaries [a development stage company] as of December 31, 2003, and the related consolidated statements of operations, stockholders' deficit, and cash flows for each of the two years in the period then ended and for the period from May 2, 1998 [inception] to December 31, 2003. These consolidated financial statements are the responsibility of the Company's management.  Our responsibility is to express an opinion on these consolidated financial statements based on our audit.

We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement.  An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the consolidated financial statements.  An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall consolidated financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Transax International Limited and subsidiaries [a development stage company] as of December 31, 2003 and the results of their operations and their cash flows for each of the two years in the period then ended and for the period from May 2, 1998 [inception] to December 31, 2003 in conformity with accounting principles generally accepted in the United States of America.

The accompanying consolidated financial statements have been prepared assuming the Company will continue as a going concern. As discussed in Note 3 to the consolidated financial statements, the Company has accumulated losses from operations of approximately $6.7 million and has a net capital deficiency of approximately $1.6 million at December 31, 2003. These conditions raise substantial doubt about the Company's ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 3. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Moore Stephens, P.C.
Certified Public Accountants
New York, New York
April 9, 2004
Back to Index of Financial StatementsBack to Table of Contents
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

---

|**TRANSAX INTERNATIONAL LIMITED and SUBSIDIARIES**
			
			(Formerly Vega-Atlantic Corporation)**[A Development Stage Company]
			Consolidated Balance Sheet
			December 31, 2003**Back to Index of Financial StatementsBack to Table of Contents
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|**ASSETS
			Current**                                                                                                                                           
|----------------------------------------------------------------------------------------------------------------------------------------------------------------
|Cash                                                                                                                                                            
|Prepaid expenses and other current assets                                                                                                                       
|                                                                                                                                                                
|**Total Current Assets**                                                                                                                                        
|**Software Development Costs,** net                                                                                                                             
|                                                                                                                                                                
|**Property and Equipment,** net                                                                                                                                 
|                                                                                                                                                                
|**Total Assets**                                                                                                                                                
|                                                                                                                                                                
|**LIABILITIES
			Current**                                                                                                                                      
|Current portion of capital lease obligation                                                                                                                     
|Accounts payable and accrued expenses                                                                                                                           
|Accrued payroll and related expenses                                                                                                                            
|Due to related party                                                                                                                                            
|Advances payable                                                                                                                                                
|Convertible loans from related party                                                                                                                            
|                                                                                                                                                                
|**Total Current Liabilities**                                                                                                                                   
|**Capital Lease Obligation,** net of current portion                                                                                                            
|                                                                                                                                                                
|**Total Liabilities**                                                                                                                                           
|                                                                                                                                                                
|**COMMITMENTS and CONTINGENCIES** (Note 12)**STOCKHOLDERS' DEFICIT**                                                                                            
|Common stock 0.00001 par value;                                                                                                                                 
|100,000,000 shares authorized;                                                                                                                                  
|14,029,647 shares issued and outstanding                                                                                                                        
|Paid-in capital                                                                                                                                                 
|Share subscriptions received                                                                                                                                    
|Accumulated deficit during development stage                                                                                                                    
|Other comprehensive income :                                                                                                                                    
|Cumulative foreign currency translation adjustment                                                                                                              
|                                                                                                                                                                
|**Total Stockholders' Deficit**                                                                                                                                 
|                                                                                                                                                                
|**Total Liabilities and Stockholders' Deficit**                                                                                                                 
|                                                                                                                                                                
|The accompanying notes are an integral part of these audited consolidated financial statements
			Back to Index of Financial StatementsBack to Table of Contents

---

|**TRANSAX INTERNATIONAL LIMITED and SUBSIDIARIES**
			
			(Formerly Vega-Atlantic Corporation)**[A Development Stage Company]
			Consolidated Statements of Operations
			December 31, 2003**Back to Index of Financial StatementsBack to Table of Contents
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                                                                                                                                                 | **For the years ended December 31,** | **For the period from May 2, 1998 [Inception] to December 31, 2003**
|---------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------ | --------------------------------------------------------------------
|**2003**                                                                                                                                                         | **2002**                            
|                                                                                                                                                                
|**Revenues**                                                                                                                                                     | $309,589                             | $51,604                                                             
|                                                                                                                                                                
|Cost of product support services                                                                                                                                 | 397,942                              | 426,215                                                             
|Payroll and related benefits                                                                                                                                     | 302,549                              | 344,889                                                             
|Research & development costs                                                                                                                                     | 24,449                               | 446,362                                                             
|Professional fees                                                                                                                                                | 385,563                              | 174,685                                                             
|Management & consulting fees - related party                                                                                                                     | 398,181                              | 144,761                                                             
|Stock based compensation                                                                                                                                         | 1,210,100                            | -                                                                   
|Investor relations                                                                                                                                               | 162,891                              | -                                                                   
|Depreciation and amortization                                                                                                                                    | 106,177                              | 26,944                                                              
|General & administrative                                                                                                                                         | 364,187                              | 232,888                                                             
|                                                                                                                                                                
|**Total Operating Expenses**                                                                                                                                     | 3,352,039                            | 1,796,744                                                           
|                                                                                                                                                                
|**Operating Loss**                                                                                                                                               | (3,042,450)                          | (1,745,140)                                                         
|                                                                                                                                                                
|**Other Expenses:**                                                                                                                                              |                                      |                                                                     
|Loss on disposal of fixed assets                                                                                                                                 | (2,588)                              | -                                                                   
|Other expense                                                                                                                                                    | (27,616)                             | -                                                                   
|Foreign exchange losses                                                                                                                                          | (6,531)                              | (210,132)                                                           
|Interest expense                                                                                                                                                 | (86,059)                             | (29,412)                                                            
|Interest expense - related party                                                                                                                                 | (65,032)                             | (132,204)                                                           
|                                                                                                                                                                
|**Total Other Expenses**                                                                                                                                         | (187,826)                            | (371,748)                                                           
|                                                                                                                                                                
|**Net Loss**                                                                                                                                                     | $(3,230,276)                         | $(2,116,888)                                                        
|                                                                                                                                                                
|**Net loss per Share:**                                                                                                                                          |                                      |                                                                     
|**Basic and Diluted**                                                                                                                                            | $(0.25)                              | $(0.17)                                                             
|                                                                                                                                                                 |                                      |                                                                     
|**Weighted Average Shares Outstanding**                                                                                                                          | 12,953,494                           | 12,472,917                                                          
|                                                                                                                                                                 |                                      |                                                                     
|The accompanying notes are an integral part of these audited consolidated financial statements
			Back to Index of Financial StatementsBack to Table of Contents

---

|**TRANSAX INTERNATIONAL LIMITED and SUBSIDIARIES**
			
			(Formerly Vega-Atlantic Corporation)**[A Development Stage Company]
			Consolidated Statements of Stockholders' Equity [Deficit]
			For the period from May 2, 1998 [Date of Inception] to December 31, 2003**Back to Index of Financial StatementsBack to Table of Contents
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                                                                                                                                                                              | **Common Stock - Par Value** | **Share Subscrip- tions** | **Paid-In Capital** | **Accum- ulated Deficit** | **Accumulated Other Compre- hensive Income (Loss)** | **Total Stock- holders' Equity [Deficit]**
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------- | ------------------------- | ------------------- | ------------------------- | --------------------------------------------------- | ------------------------------------------
|**Shares**                                                                                                                                                                                    | **Amount**                  
|Shares issued as per merger agreement                                                                                                                                                         | 11,066,207                   | 110                       |                     | (110)                     |                                                     |                                           
|Additional shares (rounding) issued as per merger agreement                                                                                                                                   | 9                            |                           |                     |                           |                                                     |                                           
|Accumulated deficit of acquiree in merger                                                                                                                                                     | 1,406,701                    | 15                        |                     | (650,050)                 |                                                     |                                           
|Balance, May 2, 1998 [Date of Inception]                                                                                                                                                      | 2,423,807                    | $1,039,859                | $(563,219)          | $                         | $                                                   | $                                         
|Recapitali- zation as a result of merger of Telecom- munication Data System LTDA. ["TDS"],
			a wholly-owned subsidiary of Cardlink Worldwide Inc. ("Cardlink"), under Plan of Reorganization | (2,423,807)                  |                           |                     |                           |                                                     |                                           
|Accumulated deficit of acquiree in merger                                                                                                                                                     |                              |                           |                     | (723,036)                 |                                                     |                                           
|Common stock issued to Cardlink as a result of merger of TDS under Plan of Reorganization                                                                                                     | 5,432,403                    |                           |                     |                           |                                                     |                                           
|Conversion of Carlingford Investments Limited ("CIL") advances to common stock under Plan of Reorganization                                                                                   | 10,100,000                   | 2,500,000                 |                     |                           |                                                     |                                           
|Common stock issued to founders                                                                                                                                                               | 10                           |                           |                     |                           |                                                     |                                           
|Proceeds received from share subscriptions for 619,204 common shares                                                                                                                          |                              |                           | 154,801             |                           |                                                     |                                           
|Common stock issued (619,204 shares) for subscriptions received                                                                                                                               | 619,204                      | 154,801                   | (154,801)           |                           |                                                     |                                           
|Unissued shares (176,797) - compensation in connection with issuance of share subscriptions                                                                                                   |                              |                           | (44,199)            |                           |                                                     |                                           
|Unissued shares (600,000) - stock based compensation in connection with CIL loan advances                                                                                                     |                              |                           | (150,000)           |                           |                                                     |                                           
|Common stock issued (776,797 shares) for stock based compensation in connection with share subscriptions                                                                                      | 776,797                      |                           | 194,199             |                           |                                                     |                                           
|Common stock issued to CIL (204,000 shares) for commissions incurred on cash advances                                                                                                         | 204,000                      | 51,000                    |                     |                           |                                                     |                                           
|Common stock issued to CIL (5,000,000 shares) for settlement of debt                                                                                                                          | 5,000,000                    | 250,000                   |                     |                           |                                                     |                                           
|Stock options and warrants to be issued                                                                                                                                                       |                              |                           |                     | 171,390                   |                                                     |                                           
|Recapital- ization as a result of merger of Transax Limited ["Transax"] with Vega-Atlantic Corp.                                                                                              | (22,132,414)                 | (3,995,660)               |                     | 3,995,660                 |                                                     |                                           
|Comprehensive income (Loss):                                                                                                                                                                  |                              |                           |                     |                           |                                                     |                                           
|Net loss for period May 2, 1998 to December 31, 1998                                                                                                                                          |                              |                           |                     |                           | (169,022)                                           |                                           
|Foreign currency translation adjustment                                                                                                                                                       |                              |                           |                     |                           |                                                     | (91,910)                                  
|Total comprehensive income (loss)                                                                                                                                                             |                              |                           |                     |                           |                                                     |                                           
|**Balance, December 31, 1998**                                                                                                                                                                | **12,472,917**               | **$125**                  | **$(563,219)**      | **$2,793,854**            | **$(169,022)**                                      | **$(91,910)**                             

---

|**TRANSAX INTERNATIONAL LIMITED and SUBSIDIARIES**
			
			(Formerly Vega-Atlantic Corporation)**[A Development Stage Company]
			Consolidated Statements of Stockholders' Equity [Deficit] (Continued)
			For the period from May 2, 1998 [Date of Inception] to December 31, 2003**Back to Index of Financial StatementsBack to Table of Contents
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                                        | **Common Stock - Par Value** | **Share Subscriptions** | **Paid-In Capital** | **Accumulated Deficit** | **Accumulated Other Comprehensive Income (Loss)** | **Total Stockholders' Equity [Deficit]**
|------------------------------------------------------- | ---------------------------- | ----------------------- | ------------------- | ----------------------- | ------------------------------------------------- | ----------------------------------------
|**Shares**                                              | **Amount**                  
|**Balance, December 31, 1998**                          | **12,472,917**               | **$125**                | **$(563,219)**      | **$2,793,854**          | **$(169,022)**                                    | **$(91,910)**                           
|Comprehensive Income (Loss)                            
|Net loss for year                                       |                              |                         |                     |                         | (189,883)                                         |                                         
|Foreign currency translation adjustments                |                              |                         |                     |                         |                                                   | (25,487)                                
|Total comprehensive income (loss)                       |                              |                         |                     |                         |                                                   |                                         
|**Balance, December 31, 1999**                          | **12,472,917**               | **$125**                | **$(563,219)**      | **$2,793,854**          | **$(358,905)**                                    | **$(117,397)**                          
|Proceeds received from prior period share subscriptions |                              |                         | 495,759             |                         |                                                   |                                         
|Comprehensive Income (Loss)                            
|Net loss for year                                       |                              |                         |                     |                         | (368,739)                                         |                                         
|Foreign currency translation adjustments                |                              |                         |                     |                         |                                                   | (26,007)                                
|Total comprehensive income (loss)                       |                              |                         |                     |                         |                                                   |                                         
|**Balance, December 31, 2000**                          | **12,472,917**               | **$125**                | **$(67,460)**       | **$2,793,854**          | **$(727,644)**                                    | **$(143,404)**                          
|Proceeds received from prior period share subscriptions |                              |                         | 67,460              |                         |                                                   |                                         
|Comprehensive Income (Loss)                            
|Net loss for year                                       |                              |                         |                     |                         | (612,874)                                         |                                         
|Foreign currency translation adjustments                |                              |                         |                     |                         |                                                   | 33,543                                  
|Total comprehensive income (loss)                       |                              |                         |                     |                         |                                                   |                                         
|**Balance, December 31, 2001**                          | **12,472,917**               | **$125**                | **-**               | **$2,793,854**          | **$(1,340,518)**                                  | **$(109,861)**                          
|Comprehensive Income (Loss)                            
|Net loss for year                                       |                              |                         |                     |                         | (2,116,887)                                       |                                         
|Foreign currency translation adjustments                |                              |                         |                     |                         |                                                   | 243,330                                 
|Total comprehensive income (loss)                       |                              |                         |                     |                         |                                                   |                                         
|**Balance, December 31, 2002**                          | **12,472,917**               | **$125**                | **-**               | **$2,793,854**          | **$(3,457,405)**                                  | **$133,469**                            

---

|**TRANSAX INTERNATIONAL LIMITED and SUBSIDIARIES**
			
			(Formerly Vega-Atlantic Corporation)**[A Development Stage Company]
			Consolidated Statements of Stockholders' Equity [Deficit] (Continued)
			For the period from May 2, 1998 [Date of Inception] to December 31, 2003**Back to Index of Financial StatementsBack to Table of Contents
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                                                                    | **Common Stock - Par Value** | **Share Subscriptions** | **Paid-In Capital** | **Accumulated Deficit** | **Accumulated Other Comprehensive Income (Loss)** | **Total Stockholders' Equity [Deficit]**
|----------------------------------------------------------------------------------- | ---------------------------- | ----------------------- | ------------------- | ----------------------- | ------------------------------------------------- | ----------------------------------------
|**Shares**                                                                          | **Amount**                  
|**Balance, December 31, 2002**                                                      | **12,472,917**               | **$125**                | **-**               | **$2,793,854**          | **$(3,457,405)**                                  | **$133,469**                            
|Issuance of stock for options exercised for settlement of debt,
			August 28, 2003  | 1,206,730                    | 12                      |                     | 652,059                 |                                                   |                                         
|Issuance of stock for settlement of debt,
			August 28, 2003                        | 100,000                      | 1                       |                     | 99,999                  |                                                   |                                         
|Issuance of stock for options exercised for settlement of debt,
			October 22, 2003 | 87,500                       | 1                       |                     | 43,749                  |                                                   |                                         
|Unissued shares (450,000) - for settlement of debt,
			November 21, 2003            |                              |                         | 225,000             |                         |                                                   |                                         
|Unissued shares (45,000) - for finders' fees on cash advances,
			November 21, 2003 |                              |                         | 27,900              |                         |                                                   |                                         
|Issuance of stock for options exercised for settlement of debt,
			December 3, 2003 | 162,500                      | 2                       |                     | 40,623                  |                                                   |                                         
|Unissued shares [300,000] for options exercised,
			December 31, 2003               |                              |                         | 75,000              | -                       |                                                   |                                         
|Unissued shares [373,570] for loan conversion - Related Party,
			December 31, 2003 |                              |                         | 93,393              |                         |                                                   |                                         
|Stock options and warrants issued                                                   |                              |                         |                     | 959,810                 |                                                   |                                         
|Comprehensive Income (Loss)                                                        
|Net loss for year                                                                   |                              |                         |                     |                         | (3,230,276)                                       |                                         
|Foreign currency translation adjustments                                            |                              |                         |                     |                         |                                                   | (78,793)                                
|Total comprehensive income (loss)                                                   |                              |                         |                     |                         |                                                   |                                         
|**Balance, December 31, 2003**                                                      | **14,029,647**               | **$141**                | **$421,293**        | **$4,590,094**          | **$(6,687,681)**                                  | **$54,676**                             

|The accompanying notes are an integral part of these audited consolidated financial statements
			Back to Index of Financial StatementsBack to Table of Contents
|----------------------------------------------------------------------------------------------------------------------------------------------------------------

---

|**TRANSAX INTERNATIONAL LIMITED and SUBSIDIARIES**
			
			(Formerly Vega-Atlantic Corporation)**[A Development Stage Company]
			Consolidated Statements of Cash Flows**Back to Index of Financial StatementsBack to Table of Contents
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                                                                                                                                                  | **For the year ended December 31** | **For the period from May 2, 1998 [Inception] to December 31, 2003**
|----------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------- | --------------------------------------------------------------------
|**2003**                                                                                                                                                          | **2002**                          
|                                                                                                                                                                 
|**Cash Flows from (used in)
			Operating Activities**                                                                                                             |                                   
|Net (loss) for the period                                                                                                                                         | $(3,230,276)                       | $(2,116,888)                                                        
|Adjustments to reconcile net loss to net cash used in operating activities:                                                                                       |                                    |                                                                     
|-depreciation and amortization                                                                                                                                    | 130,626                            | 26,944                                                              
|-bad debt expense                                                                                                                                                 | -                                  | 18,396                                                              
|-stock based compensation                                                                                                                                         | 1,210,100                          | -                                                                   
|Changes in assets and liabilities:                                                                                                                                |                                    |                                                                     
|-prepaid expenses and other current assets                                                                                                                        | (20,477)                           | 32,327                                                              
|-accounts payable                                                                                                                                                 | 435,451                            | 121,066                                                             
|-accrued interest payable, related party                                                                                                                          | 14,686                             | -                                                                   
|-accrued interest payable                                                                                                                                         | 10,474                             | -                                                                   
|-due to related party                                                                                                                                             | 196,104                            | -                                                                   
|-accrued payroll and related expenses                                                                                                                             | 153,548                            | 155,970                                                             
|-other                                                                                                                                                            | 2,026                              | (15,213)                                                            
|                                                                                                                                                                 
|**Cash Flows - Operating Activities**                                                                                                                             | (1,097,738)                        | (1,777,398)                                                         
|                                                                                                                                                                 
|**Cash flows from (used in) Investing Activities**                                                                                                                |                                    |                                                                     
|Capitalized software development costs                                                                                                                            | (134,785)                          | -                                                                   
|Acquisition of property and equipment                                                                                                                             | (43,628)                           | -                                                                   
|                                                                                                                                                                 
|**Cash Flows - Investing Activities**                                                                                                                             | (178,413)                          | -                                                                   
|                                                                                                                                                                 
|**Cash flows from (used in) Financing Activities**                                                                                                                |                                    |                                                                     
|Proceeds from issuance of common stock                                                                                                                            | -                                  | 154,801                                                             
|Advances from related party                                                                                                                                       | 484,045                            | 1,370,146                                                           
|Advances from a non-related party                                                                                                                                 | 526,500                            | -                                                                   
|Repayments under capital lease obligations                                                                                                                        | (45,916)                           | (26,207)                                                            
|Proceeds from convertible loans - related party                                                                                                                   | 355,000                            | 66,195                                                              
|                                                                                                                                                                 
|**Cash Flows - Financing Activities**                                                                                                                             | 1,319,629                          | 1,564,935                                                           
|                                                                                                                                                                 
|**Effect of Exchange Rate Changes on Cash**                                                                                                                       | (64,113)                           | 243,330                                                             
|                                                                                                                                                                 
|**Net Increase (Decrease) in Cash**                                                                                                                               | (20,635)                           | 30,867                                                              
|**Cash, Beginning of Period**                                                                                                                                     | 31,107                             | 240                                                                 
|                                                                                                                                                                 
|**Cash, End of Period**                                                                                                                                           | $10,474                            | $31,107                                                             
|                                                                                                                                                                 
|The accompanying notes are an integral part of these audited consolidated financial statements.
			Back to Index of Financial StatementsBack to Table of Contents

---

|**TRANSAX INTERNATIONAL LIMITED and SUBSIDIARIES**
			
			(Formerly Vega-Atlantic Corporation)**[A Development Stage Company]
			Consolidated Statements of Cash Flows (Continued)**Back to Index of Financial StatementsBack to Table of Contents
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                                                                                                                                               | **For the Year ended December 31,**
|-------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------
|**2003**                                                                                                                                                       | **2002**                           
|**SUPPLEMENTAL CASH DISCLOSURES**                                                                                                                              |                                    
|Cash paid for interest                                                                                                                                         | $22,683                            
|Cash paid for interest - Related Party                                                                                                                         | $ -                                
|Cash paid for income taxes                                                                                                                                     | $ -                                
|**SUPPLEMENTAL NON-CASH DISCLOSURES**                                                                                                                          |                                    
|776,797 shares issued for stock based compensation [pre merger]                                                                                                | $194,199                           
|204,000 shares issued for settlement of finders fees [pre merger]                                                                                              | $51,000                            
|5,000,000 shares issued for settlement of debt [pre merger]                                                                                                    | $250,000                           
|1,206,730 shares issued for options exercised for settlement of debt                                                                                           | $652,071                           
|100,000 shares and 50,000 warrants issued for settlement of debt                                                                                               | $100,000                           
|87,500 shares issued for options exercised for settlement of debt                                                                                              | $43,750                            
|450,000 shares and 225,000 warrants to be issued for settlement of debt                                                                                        | $225,000                           
|45,000 shares to be issued for finder's fees                                                                                                                   | $27,900                            
|162,500 shares issued for options exercise for settlement of debt                                                                                              | $40,625                            
|300,000 shares to be issued for options exercised for settlement of debt                                                                                       | $75,000                            
|373,570 shares and 373,570 warrants to be issued for loan conversion, Related Party                                                                            | $93,393                            
|The accompanying notes are an integral part of these audited consolidated financial statements.
Back to Index of Financial StatementsBack to Table of Contents

---

|**TRANSAX INTERNATIONAL LIMITED and SUBSIDIARIES**
			
			(Formerly Vega-Atlantic Corporation)**[A Development Stage Company]
			Notes to the Consolidated Financial Statements**Back to Index of Financial StatementsBack to Table of Contents
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|**1. The Company**
Transax International Limited (“TNSX” or the “Company”)
  (formerly Vega-Atlantic Corporation) was incorporated in the State of Colorado.
  The Company currently trades on the OTC Bulletin Board under the symbol "TNSX"
  and the Frankfurt and Berlin Stock Exchanges under the symbol "TX6".
On June 19, 2003 Transax Limited (“Transax”) entered into an Agreement
  in Principle (collectively with the Merger Agreement, referred to as the “Agreement”,
  or the “Merger”) to, by way of merger, exchange all of its outstanding
  shares for an aggregate of 11,066,207 restricted common shares of the Company,
  at a deemed issuance price of $0.50 per share. As of the contemplated merger
  date, Transax had outstanding 22,132,414 common shares, 8,200,000 warrants and
  9,000,000 stock options. These securities were subject to a reverse two-to-one
  split under the Agreement. The Agreement was finalized on July 22, 2003, and
  the transaction closed effective August 14, 2003 (See Note 2, Merger).
The Company, through its wholly owned subsidiary TDS Telecommunication Data
  Systems Ltda. (“TDS”), is an international provider of information
  network solutions specifically designed for the healthcare providers and health
  insurance companies. The MedLink SolutionTM enables the real time automation
  of routine patient eligibility, verification, authorizations, claims processing
  and payment functions. The Company also has offices located in Australia, Singapore,
  Mauritius.
The Company is in the development stage as defined in Financial Accounting Standards
  Board (“FASB”) Statement No. 7, Accounting and Reporting for Development
  Stage Companies. To date, the Company has generated limited sales and has devoted
  its efforts primarily to developing its products, implementing its business
  strategy and raising working capital through equity financing or short-term
  borrowings.
The accompanying audited consolidated financial statements of the Company present
  the accounts of Transax for the years ended December 31, 2003 and 2002, including
  TNSX from the effective date of the merger (August 14, 2003) to December 31,
  2003 (See Note 2). All material intercompany accounts and transactions between
  the Company and its subsidiaries have been eliminated.

**2. Merger**
On June 19, 2003 Transax entered into an Agreement in Principle to, by way of
  merger, exchange all of its outstanding shares for an aggregate of 11,066,207
  restricted common shares of the Company, at a deemed issuance price of $0.50
  per share. As of the contemplated merger date, Transax had outstanding 22,132,414
  common shares, 8,200,000 warrants and 9,000,000 stock options. These securities
  were subject to a reverse two-to-one split under the Agreement. The Agreement
  was finalized on July 22, 2003, and, on August 14, 2003, the Merger was deemed
  closed, and the Board or Directors of the newly merged company, Transax International
  Limited, or “TNSX”, approved the issuance of 11,066,207 common shares
  pursuant to the terms of the Merger. After the merger, TNSX had 12,472,917 common
  shares outstanding.
Under generally accepted accounting principles, the acquisition is considered
  to be a capital transaction in substance, rather than a business combination.
  That is, the acquisition is equivalent to the issuance of stock by Transax for
  the net monetary assets of TNSX, accompanied by a recapitalization, and is accounted
  for as a change in capital structure. Accordingly, the accounting for the acquisition
  is identical to that resulting from a reverse acquisition, except that no goodwill
  is recorded. Under reverse takeover accounting, the comparative historical financial
  statements of the "legal acquiror" (TNSX) are those of the "accounting
  acquiror" (Transax). Costs associated with the reverse merger were expensed
  as incurred. Shares issued in the transaction are shown as outstanding for all
  periods presented. Activities of the legal aquiror are included from the date
  of the transaction onward.
On August 8, 2003, the shareholders of both TNSX and Transax held meetings.
  TNSX’s shareholders approved the following ratifications: (i) name change
  from Vega-Atlantic Corporation to Transax International Limited; (ii) the Stock
  Option Plan, and; (iii) the reverse Stock Split. Moreover, on August 8, 2003,
  the shareholders of Transax approved the terms and conditions of the Agreement
  in Principle and of the Merger Agreement.
Pursuant to the terms of the Merger Agreement and a corresponding contribution
  agreement, Transax has contributed to the Company 11,066,207 shares of its restricted
  common stock, 4,500,000 stock options and 4,100,000 share purchase warrants.
  Pursuant to further terms of the Agreement, the Company has: (i) exchanged with
  the Transax shareholders an aggregate of 11,066,207 shares of the Company’s
  restricted common stock (on the basis of each two Transax shares of common stock
  exchanged into the right to receive one share of common stock of TNSX); (ii)
  exchanged with the Transax option holders an aggregate of 4,500,000 stock options
  to acquire up to 4,500,000 shares of TNSX’s common stock to replace all
  stock options presently outstanding in Transax (on the basis of each two Transax
  stock options exchanged into the right to receive one stock option of TNSX);
  and (iii) exchanged with the Transax warrant holders an aggregate of 4,100,000
  share purchase warrants to acquire up to 4,100,000 shares of TNSX’s common
  stock to replace all share purchase warrants presently outstanding in Transax
  (on the basis of each two Transax share purchase warrants exchanged into the
  right to receive one share purchase warrant of TNSX).
On September 22, 2003 the Board of Directors of the Company approved a change
  in fiscal year end of the Company from March 31st to a calendar year-end of
  December 31st. The Board of Directors’ decision to change the fiscal year
  end was based upon consummation of the Merger and the resulting continuation
  of the corporate entity TNSX under the Merger, which has a calendar year end.

**3. Going Concern**
Since inception, the Company has incurred cumulative net losses of approximately
  $6,687,700 and has a stockholders’ deficit of approximately $1,621,500
  at December 31, 2003. The Company expects to continue to incur substantial losses
  to develop its products and distribution networks, and does not expect to attain
  profitability in the near future. Since its inception, the Company has funded
  operations through short-term borrowings and equity investments in order to
  meet its strategic objectives. The Company's future operations are dependent
  upon external funding and its ability to increase revenues and reduce expenses.
  Management believes that sufficient funding will be available from additional
  related party borrowings and private placements to meet its business objectives,
  including anticipated cash needs for working capital, for a reasonable period
  of time. However, there can be no assurance that the Company will be able to
  obtain sufficient funds to continue the development of its software products
  and distribution networks.
Further, since fiscal 2000, the Company has been deficient in the payment of
  Brazilian payroll taxes and Social Security taxes. At December 31, 2003, these
  deficiencies amounted to approximately $298,600, including a provision of interest
  and fines of approximately $61,700. This payroll liability is included as part
  of the accrued payroll and related expenses within the consolidated balance
  sheet.
  As a result of the foregoing, there exists substantial doubt about the Company’s
  ability to continue as a going concern. These consolidated financial statements
  do not include any adjustments that might result from the outcome of this uncertainty.

**4. Summary of Significant Accounting Policies**
**Principle of Consolidation**
    The accompanying consolidated financial statements include the accounts of
    the Company and its wholly – owned subsidiaries. All significant intercompany
    transactions and balances have been eliminated (see Note 2).
  **Use of Estimates**
    The preparation of financial statements in conformity with 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 dates of the financial statements
    and the reported amounts of revenues and expenses during the reporting periods.
    Actual results could differ from those estimates.
  **Revenue Recognition**
    Revenue from the sale of software products, which do not require any significant
    production, modification or customization for the Company’s targeted
    customers and do not have multiple elements, is recognized when: (1) persuasive
    evidence of an arrangement exists; (2) delivery has occurred; (3) the Company’s
    fee is fixed and determinable, and; (4) collectibility is probable.
  **Cash and Cash Equivalents**
    Cash and cash equivalents consists of cash on deposit and highly liquid short-term
    interest bearing securities with a maturity at the date of purchase of three
    months or less. As of December 31, 2003, the Company had no cash equivalents.
  **Property and Equipment, net**
    Property and equipment is stated at cost less accumulated depreciation and
    amortization. Depreciation and amortization is recorded on a straight-line
    basis over the estimated useful lives (approximately 2 – 10 years) of
    the assets. Expenditures for maintenance and repairs that do not improve or
    extend the life of the expected assets are expensed to operations, while major
    repairs are capitalized.
  **Impairment**
    Certain long-term assets of the Company are reviewed when changes in circumstances
    indicate their carrying values may have become impaired, pursuant to guidance
    established in Statement of Financial Accounting Standards ("SFAS")
    No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets. Management
    considers assets to be impaired if the carrying value exceeds the future projected
    cash flows from related operations (undiscounted and without interest charges).
    If impairment is deemed to exist, the asset will be written down to fair value.
    Management also reevaluates the period of depreciation or amortization to
    determine whether subsequent events and circumstances warrant revised estimates
    of useful lives. As of December 31, 2003, management expects those assets
    related to its continuing operations to be fully recoverable.
  **Income Taxes**
    The Company accounts for income taxes under SFAS No. 109, Accounting for Income
    Taxes. Under SFAS No.109, deferred tax assets and liabilities are recognized
    for the future tax consequences attributable to differences between their
    financial statement carrying amounts and their respective tax bases. 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. Under SFAS No. 109, the effect on
    deferred tax assets and liabilities of a change in tax rates is recognized
    in income in the period that includes the enactment date.
  **Foreign Currency Translation**
    The assets and liabilities of the Company’s foreign subsidiary are translated
    into U.S. dollars at the year-end exchange rates and all revenue and expenses
    are translated into U.S. dollars at the average exchange rates prevailing
    during the periods in which these items arise. Translation gains and losses
    are deferred and accumulated as a component of other comprehensive income
    in stockholders’ deficit. Transaction gains and losses that arise from
    exchange rate fluctuations on transactions denominated in a currency other
    than the functional currency (TDS – Brazilian Real, Transax Australia,
    - Australian dollar and Transax and the Company – USD) are included
    in the Statement of Operations as incurred.
  **Loss Per Share**
    Basic loss per share is computed by dividing the loss for the period by the
    weighted average number of common shares outstanding for the period. The weighted
    average number of common shares outstanding has been retroactively restated
    for all the periods presented to reflect the effects of the merger (see Note
    2). Diluted loss per share reflects the potential dilution of securities by
    including other potential common stock, including stock options and warrants,
    in the weighted average number of common shares outstanding for a period,
    if dilutive. 
    At December 31, 2003, there were 4,748,570 outstanding warrants and 2,743,270
    outstanding options that were granted under the year 2003 incentive stock
    option plan (See Note 14). These securities may dilute the earnings per share
    calculation in the future.
  **Comprehensive Income**
    The Company has adopted SFAS No. 130, Reporting Comprehensive Income. Other
    comprehensive income, which currently includes only foreign currency translation
    adjustments, is shown net of tax in the Statement of Changes in Stockholders’
    Deficit.
  **Fair Value of Financial Instruments**
    SFAS No. 107, Disclosures about Fair Values of Financial Instruments, requires
    disclosing fair value to the extent practicable for financial instruments,
    which are recognized or unrecognized in the balance sheet. The fair value
    of the financial instruments disclosed herein is not necessarily representative
    of the amount that could be realized or settled, nor does the fair value amount
    consider the tax consequences of realization or settlement. 
    For certain financial instruments, including cash, accounts payable and accrued
    expenses and short term debt, it was assumed that the carrying amounts approximate
    fair value because of the near term maturities of such obligations. The fair
    value of long-term debt was determined based on current rates at which the Company could
    borrow funds with similar remaining maturities, which amount approximates
    its carrying value.
  **Stock Based Compensation**
    The Company accounts for stock-based employee compensation arrangements in
    accordance with the provisions of Accounting Principles Board (“APB”)
    Opinion No. 25, Accounting for Stock Issued to Employees, and complies with
    the disclosure provisions of SFAS No. 123, Accounting for Stock-Based Compensation.
    Under APB No. 25, compensation expense is recognized based on the difference,
    if any, on the date of grant between the estimated market value of the Company’s
    stock and the amount an employee must pay to acquire the stock. Compensation
    expense is recognized immediately for past services and rateably for future
    services over the option-vesting period. 
    The Company accounts for equity instruments issued in exchange for the receipt
    of goods or services from other than employees in accordance with SFAS No.
    123 and the conclusions reached by the Emerging Issues Task Force (“EITF”)
    in Issue No. 96-18, Accounting for Equity Instruments That Are Issued to Other
    Than Employees for Acquiring or in Conjunction with Selling, Goods or Services.
    Costs are measured at the estimated fair market value of the consideration
    received or the estimated fair value of the equity instruments issued, whichever
    is more reliably measurable. The value of equity instruments issued for consideration
    other than employee services is determined on the earlier of a performance
    commitment or completion of performance by the provider of goods or services
    as defined by EITF No. 96-18.
  **Allowance for Doubtful Accounts**
    The Company recognizes an allowance for doubtful accounts to ensure accounts
    receivable are not overstated due to uncollectibility. Bad debt reserves are
    maintained for all customers based on a variety of factors, including the
    length of time the receivables are past due, significant one-time events and
    historical experience. An additional reserve for individual accounts is recorded
    when the Company becomes aware of a customer’s inability to meet its
    financial obligation, such as in the case of bankruptcy filings or deterioration
    in the customer’s operating results or financial position. If circumstances
    related to customers change, estimates of the recoverability of receivables
    would be further adjusted. As of December 31, 2003, the allowance for doubtful
    accounts was $NIL.**5. Financial Instruments / Credit risk**
The Company performs certain credit evaluation procedures and does not require
  collateral for financial instruments subject to credit risk. The Company believes
  that credit risk is limited because the Company routinely assesses the financial
  strength of its customers, and based upon factors surrounding the credit risk
  of its customers, establishes an allowance for uncollectible accounts and, as
  a consequence, believes that its accounts receivable credit risk exposure beyond
  such allowances is limited.
The Company’s principal business activities are located in Brazil. Although
  Brazil is considered to be economically stable, it is always possible that unanticipated
  events in foreign countries could disrupt the Company’s operations. 

  The Company had net sales to 2 major customers during each of the years ended
  December 31, 2003 and 2002. These sales accounted for approximately 95% or $294,100
  and 100% or $51,600 of the total sales for the years 2003 and 2002, respectively.
The Company maintains cash deposits with financial institutions, which from
  time to time may exceed federally insured limits. The Company has not experienced
  any losses and believes it is not exposed to any significant credit risk from
  cash. At December 31, 2003 the Company did not have cash balances on deposit
  that exceeded the federally insured limits.

**6. New Authoritative Pronouncements**
In December 2002, the FASB issued SFAS No. 148, Accounting for Stock-Based
    Compensation-Transition and Disclosure. SFAS No. 148 amends SFAS No. 123,
    Accounting for Stock-Based Compensation to provide alternative methods of
    transition for a voluntary change to the fair value based method of accounting
    for stock-based employee compensation. In addition, SFAS No. 148 amends the
    disclosure requirements of SFAS No. 123 to require prominent disclosures in
    both annual and interim financial statements about the method of accounting
    for stock-based employee compensation and the effect of the method used on
    reported results. SFAS No. 148 is effective for fiscal periods beginning after
    December 15, 2002.
  In April 2003, the FASB issued SFAS No. 149, Amendment of Statement 133 on
    Derivative Instruments and Hedging Activities, which clarifies financial accounting
    and reporting for derivative instruments, including certain derivative instruments
    embedded in other contracts and for hedging activities under SFAS No. 133,
    Accounting for Derivative Instruments and Hedging Activities. SFAS No. 149
    is effective for contracts entered into or modified after June 30, 2003 and
    for hedging relationships designated after June 30, 2003.The Company expects that the adoption of the new Statements will not have a
  significant impact on its financial statements.

**7. Income Taxes**
At December 31, 2003 the Company has recorded a deferred tax asset of approximately
  $980,100. This deferred tax asset is due primarily to accumulated net operating
  losses incurred since inception. A valuation allowance of an equal amount has
  been recorded because the Company believes it is more likely than not that the
  losses will not be utilized. The valuation allowance increased by approximately
  $961,600 in 2003.
The Company has accumulated approximately $2,649,000 of taxable losses, which
  can be used to offset future federal taxable income. The utilization of the
  losses expires as follows:
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|**Year** | **Amount**
|-------- | ----------
|        
|2021     | $199,200  
|2022     | $228,200  
|2023     | $2,221,600
|         |           
|         | $2,649,000

|Transax files its income tax return on a single company basis as U.S. tax rules
  prohibit the consolidation of its foreign subsidiaries.
TDS has accumulated tax loss carryforwards of approximately $2,546,800 at December
  31, 2003 (2002 - $1,327,200). Current Brazilian tax legislation imposes no time
  period for the utilization of the losses, although it does limit the annual
  usage of the losses to 30 % of taxable profits.
These losses gives rise to a deferred tax asset of approximately $866,000 (2002
  - $454,000), which has been offset by a valuation allowance of the same amount
  as the Company believes it is more likely than not that the losses will not
  be utilized.  The valuation allowance increased by approximately $412,000.

**8. Foreign Operations**
The Company identifies its operating segments based on its business activities
  and geographical locations. The Company operates within a single operating segment,
  being a provider of information network solutions specifically designed for
  healthcare providers and health insurance companies. The Company operates in
  Brazil, Australia and Mauritius, and has a registered mailing address in Singapore
  and in the USA. All of the Company’s assets are located in Brazil.
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                                    | **Year ended December 31,**
|--------------------------------------------------- | ---------------------------
|**2003**                                            | **2002**                   
|                                                    |                            
|Net sales to Unaffiliated Customers                 |                            
|Brazil                                              | $309,589                   
|USA                                                 | -                          
|Singapore                                           | -                          
|Australia                                           | -                          
|Mauritius                                           | -                          
|                                                    |                            
|                                                    | $309,589                   
|Loss from operations                                |                            
|Brazil                                              | (1,446,721)                
|USA                                                 | (1,753,628)                
|Singapore                                           | (33,256)                   
|Australia                                           | (108,934)                  
|Mauritius                                           | (9,500)                    
|                                                    |                            
|                                                    | (3,352,039)                
|                                                    |                            
|                                                    | (3,042,450)                
|Other income (expenses)                             |                            
|Brazil                                              | (105,687)                  
|USA                                                 | (90,758)                   
|Singapore                                           | -                          
|Australia                                           | 8,620                      
|Mauritius                                           | -                          
|                                                    |                            
|                                                    | (187,826)                  
|                                                    |                            
|Net loss as reported in the accompanying statements | $(3,230,276)               
|                                                    |                            

|**9. Net loss per share**
Net loss per share is based on the weighted average number if shares outstanding,
  reflecting the shares issued in the Merger as outstanding for all periods presented
  (See Note 2).

**10. Property and Equipment**
Property and equipment are comprised of the following:
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                                 | **December 31, 2003**
|------------------------------------------------ | ---------------------
|Computer equipment                               | $215,706             
|Furniture and fixtures                           | 14,982               
|Other                                            | 43,491               
|                                                 |                      
|Total at cost                                    | 274,179              
|Less : accumulated depreciation and amortization | 171,507              
|                                                 |                      
|Net property and equipment                       | $102,672             
|                                                 |                      

|In 2003, the Company changed the estimated useful lives of certain assets in
  order to reflect better current circumstances. Depreciation and amortization
  charged to operations is approximately $106,200 and $27,000 for each of the
  years ended December 31, 2003 and 2002, respectively.

**11. Software Developments Costs**
The Company established the technological feasibility of its MedLink Solutions
  in the year ended December 31, 2002. Therefore, from Inception to December 31,
  2002, all costs incurred in establishing the technological feasibility of the
  MedLink Solutions were charged to expense when incurred, as required by SFAS
  No. 2, Accounting for Research and Development Costs.
In accordance with SFAS No. 86, Accounting for the Costs of Computer Software
  to be Sold, Leased or Otherwise Marketed, the Company has capitalized certain
  of its software development costs incurred during the year ended December 31,
  2003. The capitalized costs are amortized, starting in the third quarter, based
  on the current and future revenue for each product. Approximately $24,400 in
  amortization of the development costs was charged to operations for the year
  ended December 31, 2003 (2002 : $Nil).

**12. Commitments and Contingencies**
**Rent**
The Company has an operating lease for rental of office space in Brazil, renewable
  on an annual basis. 

  Rent expense amounted to approximately $46,000 and $64,200 and is classified
  as part of general and administrative expenses in the statement of operations
  for each of the years ended December 31 2003 and 2002, respectively.
**Leases**
In 2003 and 2002, the Company acquired Point-of-Sale terminals and various computer
  equipment under two leases that have been capitalized for approximately $88,400,
  and are included in property and equipment. Depreciation expense included in the statement of operations is approximately $29,600 and approximately $16,100 for each of the years ended December 31, 2003 and 2002 respectively.  One lease will expire in October
  2004 and has an interest rate of approximately 6.3%. The second lease will expire
  in December 2005, and has an interest of approximately 8.4%. Interest expense
  related to these two leases for the year ended December 31, 2003 was approximately
  $22,700 (2002 : $ 29,400).
The minimum lease payments under these capital leases are as follows:
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|For the year endingDecember 31, |        
|------------------------------- | -------
|                               
|2004                            | $46,031
|2005                            | $13,268
|                                |        
|                                | $59,299

|**Sales**

Through contractual agreements with three main customers, the Company is committed to
provide installations of its Medlink Solutions as per the respective roll-out plans and to
process transactions over the next two calendar years.  Above-cost fees are charged for each installation
and transaction processed.**13. Litigation**
In the normal course of its operations, the Company may be named in legal actions
  seeking monetary damages. While the outcome of these matters cannot be estimated
  with certainty, management does not expect, based upon consultation with legal
  counsel, that they would have a material adverse effect on the Company’s
  business or financial condition or results of operations.

**14. Share Capital**
**Common Stock**
On August 14, 2003, pursuant to the terms of the Merger, the Company issued
  11,066,207 shares of restricted common stock in exchange of all the outstanding
  shares of Transax limited, including 300,000 shares issued for finder’s
  fees. Nine (9) additional shares were issued pursuant to the Merger, to satisfy rounding
  of the 2:1 reverse split.
On August 28, 2003, the Company issued 1,206,730 shares of common stock for
  options exercised, for net proceeds of $652,071. The proceeds were utilized
  for the settlement of existing debt.

On August 28, 2003, the Company issued 100,000 units, at $ 1.00 per unit, in
  settlement of $100,000 of debt. Each unit is comprised of one common share and
  one half warrant. Each warrant entitles the holder to purchase an additional
  share of TNSX’s common stock at $1.50, for a period of 12 months.
On October 22, 2003, the Company issued 87,500 shares of common stock for options
  exercised, for net proceeds of $43,750. The proceeds were utilized for the settlement of
  advances payable (See Note 15).
On November 21, 2003, the Company agreed to issue 450,000 units for the conversion
  of $225,000 of advances payable. Each unit is comprised of one common share and
  one half warrant. Each warrant entitles the holder to purchase an additional
  share of TNSX’s common stock at $1.00, for a period of 24 months. At December
  31, 2003, these units had not yet been issued (See Note 15).
On November 21, 2003, the Company agreed to issue 45,000 shares of common stock
  for finders’ fees for advances. $27,900 is included as stock based compensation
  on the statement of operations. At December 31, 2003, these shares had not yet
  been issued.
On December 3, 2003, the Company issued 162,500 shares of common stock for options
  exercised, for net proceeds of $40,625. The proceeds were utilized for the settlement of
  advances payable (See Note 15).
On December 31, 2003, the Company agreed to issue 300,000 shares of common stock
  for options exercised, for net proceeds of $75,000. The proceeds were utilized for the settlement of
   advances payable. At December 31, 2003, these shares had not yet been
  issued (See Note 15).
On December 31, 2003, the Company agreed to issue 373,570 units for the conversion
  of a $66,195 loan from a related party whose officer is an officer of Company.
  Each unit is comprised of one common share and one warrant. Each warrant entitles
  the holder to purchase an additional share of TNSX’s common stock at $0.50,
  for a period of 12 months. At December 31, 2003, these units had not yet been
  issued. The loan and accrued interest amounted to approximately $93,400 at the date of conversion.
As at December 31, 2003, 14,029,647 shares were issued and outstanding.
**Stock Options**
On December 31, 2002 the Board of Directors of Transax approved the adoption
  of a 2003 incentive Stock Option Plan. Pursuant to the Merger, the Company has
  adopted Transax’s Stock Option Plan. The Plan is effective as of January
  1, 2003 and provides for the issuance of stock options to employees, consultants
  and directors. As per the terms of the Merger, on August 14, 2003, the Company
  issued 4,500,000 options under the Stock Option Plan.

As at December 31, 2003, the Company issued 6,999,040 stock options and cancelled
  2,799,040 stock options under the Plan. During the year ended December 31, 2003,
  1,456,730 stock options were exercised. At December 31, 2003, 2,743,270 stock
  options were outstanding. There were no stock options granted in 2002. These
  securities may dilute the earnings per share calculation in the future.
The Company accounts for stock-based employee compensation arrangements in accordance
  with the provisions of Accounting Principles Board Opinion No. 25, Accounting
  for Stock Issued to Employees, (“APB No. 25”) and complies with
  SFAS No. 123 Accounting for Stock-Based Compensation. For financial statement
  disclosure purposes, the fair market value of each stock option and stock warrant
  grant is estimated on the date of grant using the Black-Scholes option-pricing
  model, in accordance with Statement No. 123 using the following weighted-average
  assumptions: expected dividend yield 0%, risk-free interest rate of 2.44%, volatility
  of 136.11% and expected term of 5 years. In the year ended December 31, 2003,
  under SFAS No 123, the Company incurred a stock based compensation cost of $919,500
  for the issuance of options, and $211,700 for the issuance of warrants.

For purposes of pro forma disclosures under the fair value method, the estimated
  fair value of the options is amortized to expense over the options’ vesting
  period. The Company’s pro forma information for the year ended December
  31, 2003 and 2002 is as follows:
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                                                                                                                                                                              | **For the year ended December 31,**
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------
|**2003**                                                                                                                                                                                      | **2002**                           
|                                                                                                                                                                                             
|Net loss as reported                                                                                                                                                                          | $(3,230,276)                       
|Amount by which stock-based employee compensation
				as determined under fair value based method for all awards
				exceeds the compensation as determined under the intrinsic value method. | $(1,258,700)                       
|                                                                                                                                                                                              |                                    
|Pro forma net loss under SFAS No. 123                                                                                                                                                         | $(4,488,976)                       
|                                                                                                                                                                                              |                                    
|Basic and diluted net loss per common share as reported                                                                                                                                       | $(0.25)                            
|Pro forma net loss per common share under SFAS No. 123                                                                                                                                        | $(0.35)                            

|The table below lists the exercise prices and expiry date of outstanding options.
|---------------------------------------------------------------------------------

|                                                                         |                           | **Number of Options** | **Date of Issue** | **Exercise Price** | **Expiration Date** | **Weighted Average Exercise Price** | **Weighted Average Remaining Contractual Life**
|------------------------------------------------------------------------ | ------------------------- | --------------------- | ----------------- | ------------------ | ------------------- | ----------------------------------- | -----------------------------------------------
|                                                                         |                          
|Granted,                                                                 | August 14, 2003           | 4,500,000             | 14-Aug-03         | 0.50               | 14-Aug-08           | $0.36                               | 3.37                                           
|                                                                         | exercised during the year | (1,206,730)           |                   |                    |                     |                                     |                                                
|                                                                         | cancelled during the year | (1,293,270)           |                   |                    |                     |                                     |                                                
|                                                                         |                           |                       |                   |                    |                     |                                     |                                                
|                                                                         | number exercisable        | 2,000,000             |                   |                    |                     |                                     |                                                
|Granted,                                                                 | October 1, 2003           | 1,293,270             | 1-Oct-03          | 0.50               | 22-Oct-08           | -                                   | -                                              
|                                                                         | exercised during the year | (87,500)              |                   |                    |                     |                                     |                                                
|                                                                         | cancelled during the year | (1,205,770)           |                   |                    |                     |                                     |                                                
|                                                                         |                           |                       |                   |                    |                     |                                     |                                                
|                                                                         | number exercisable        | -                     |                   |                    |                     |                                     |                                                
|Granted,                                                                 | December 1, 2003          | 1,205,770             | 1-Dec-03          | 0.25               | 1-Dec-08            | $0.07                               | 1.33                                           
|                                                                         | exercised during the year | (162,500)             |                   |                    |                     |                                     |                                                
|                                                                         | cancelled during the year | (300,000)             |                   |                    |                     |                                     |                                                
|                                                                         |                           |                       |                   |                    |                     |                                     |                                                
|                                                                         | number exercisable        | 743,270               |                   |                    |                     |                                     |                                                
|Balance,                                                                 | December 31, 2003         | 2,743,270             |                   |                    |                     | $0.43                               | 4.71 years                                     
|                                                                         |                           |                       |                   |                    |                     |                                     |                                                
|The weighted average fair value of options granted during 2003 is $0.30.

|**Warrants**
As at December 31, 2003, 4,748,570 warrants were outstanding. Stock based compensation
  charges of approximately $211,700 are included on the statement of operations.
  There was no issuance of warrants in 2002. These securities may dilute the earnings
  per share calculation in the future.
The table below lists the exercise prices and expiry date of outstanding warrants.
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                                                          |                   | **Number of Options** | **Date of Issue** | **Exercise Price** | **Expiration Date** | **Weighted Average Exercise Price** | **Weighted Average Remaining Contractual Life**
|------------------------------------------------------------------------- | ----------------- | --------------------- | ----------------- | ------------------ | ------------------- | ----------------------------------- | -----------------------------------------------
|                                                                          |                  
|Granted,                                                                  | August 14, 2003   | 4,100,000             | 14-Aug-03         | 1.00               | 14-Aug-08           |                                     |                                                
|Granted,                                                                  | August 26, 2003   | 50,000                | 26-Aug-03         | 1.50               | 26-Aug-04           |                                     |                                                
|Granted,                                                                  | November 21, 2003 | 225,000               | 21-Nov-03         | 1.00               | 20-Nov-05           |                                     |                                                
|Granted,                                                                  | December 31, 2003 | 373,570               | 31-Dec-03         | 0.50               | 31-Dec-04           |                                     |                                                
|                                                                          |                   |                       |                   |                    |                     |                                     |                                                
|Balance,                                                                  | December 31, 2003 | 4,748,570             |                   |                    |                     | $0.93                               | 4.31                                           
|                                                                          |                   |                       |                   |                    |                     |                                     |                                                
|The weighted average fair value of warrants granted during 2003 is $0.32.

|**15. Cash Advances**
During the year ended December 31, 2003, the Company has received cash advances
  from a non-related company of $526,500 for working capital purposes. The Company has accounted for 1,000,000 common shares for the settlement
  of approximately $384,400 of these advances payable. The Company has issued 250,000
  shares and the remaining 750,000 shares have not been issued as of December
  31, 2003. The remaining advances are accruing 1% interest per month, starting
  September 1, 2003. Interest expenses related to these advances is approximately
  $10,500. At December 31, 2003, approximately $152,600 in advances and accrued
  interest were due to this non-related company.

**16. Related Parties**
**Convertible Loans**
On December 31, 2002, the Company borrowed $66,195 from a related party whose
  officer is an officer of the Company. On March 31, 2003, the Company borrowed
  $255,000 from this related party, and another $100,000 on April 30, 2003. During
  the year ended December 31, 2003, the Company incurred approximately $41,300
  in interest. Each loan is repayable on or before a six-month term. The interest
  rate is 12% per annum compounded monthly. The lender shall have the option during
  the term of the loan, and any extension thereto, to convert the principal and
  interest into common stock of TNSX, at a conversion price of $0.25 per unit.
  Each unit is comprised of one common share and one warrant. Each warrant entitles
  the holder to purchase an additional share of the Company’s common stock
  at $0.50, for a period of twelve months.
At December 31, 2003, the loans for $255,000 and $100,000 were in default, and
  the holder of the notes has not exercised the conversion feature. At December
  31, 2003, approximately $32,800 in interest was accrued on these two loans.
The Company did not incur beneficial conversion charges because the conversion price was equivalent to the average offering price for equity when these loans became convertible.**Advances**
During the year ended December 31, 2003, a related party whose officer is an officer of the Company advanced the Company
  $839,045 for working capital purposes. During the year, the related party converted $355,000
  of advances into convertible loans and converted approximately $495,200 of advances into 5,980,797 pre-merger common
  shares of Transax Limited. As per the terms of the Merger, these shares were
  subject to a 2:1 reverse split, and were then exchanged for common shares of
  the Company.
These advances are accruing 1% interest per month, starting September 1, 2003.
  At December 31, 2003, approximately $188,400 in advances and accrued interest
  were due to this related party.  This balance is included in due to related party on the balance sheet.

**Expenses**
Within the statement of operations, the following related party costs were expensed
  during the year ended December 31, 2003:
The Company incurred approximately $132,000 in consulting and management fees (2002:$30,000)
    to a director of the Company. At December 31, 2003, approximately $83,600 in consulting
    fees and approximately $57,900 in expenses were outstanding to this director;
  The Company incurred $96,000 in consulting and management fees (2002: $96,000)
    to a company whose officer is an officer of the operating subsidiary of the
    Company. At December 31, 2003, $2,000 in consulting fees was outstanding to
    this officer;
  The Company incurred approximately $30,800 in consulting and management fees
    (2002: $4,900) to a director of the Company. At December 31, 2003, approximately
    $6,400 in consulting fees and approximately $3,100 in expenses were outstanding to this
    director;
  The Company incurred approximately $69,700 in consulting fees (2002: 13,800)
    to a company whose officer is an officer of the Company. At December 31, 2003,
    approximately $26,700 in consulting fees and approximately $700 in expenses were outstanding
    to this officer;
  The Company incurred approximately $58,700 in consulting fees (2002: $0) to
    a company whose director is a director of the Company. At December 31, 2003,
    approximately $15,700 in consulting fees was outstanding to this director;
  The Company incurred approximately $10,000 in consulting fees (2002: $0) to
    a company whose officer was a director of the Company. This director resigned
    effective October 15, 2003;
  The Company incurred approximately $ 56,800 in interest (2002: $0) to a company
    whose director is a director of the Company.
**17. Subsequent events**
On January 1, 2004, the Company adopted new Bylaws, rendering the Company’s
    securities eligible for electronic transfer (“DTC”).
  On January 14, 2004, the Company issued 150,000 shares of its common stock
    for services rendered in the amount of $37,500;
  On January 14, 2004, the Company issued 150,000 shares for conversion of
    $ 37,500 in cash advances received from a non-related company;
  On February 10, 2004, the Company issued 300,000 shares of its common stock
    for options exercised. The proceeds of $75,000 were utilized to repay existing
    debt;
  On March 5, 2004, the Company received approximately $139,500 from a related party whose
    officer is an officer of the Company. The loan has a 12-month term and bears
    interest of 0.8% per month, compounded monthly, and does not have a conversion
    feature;
  On March 11, 2004, the Company terminated the engagement with its transfer
    agent, and appointed a new transfer agent. Concurrently, the Company’s
    securities are now fully eligible to transfer on the electronic system of
    the DTC.Back to Index of Financial StatementsBack to Table of Contents
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

---

|**ITEM 8. Changes in and Disagreements with Accountants on Accounting
  and Financial Disclosures.**Table of Contents
On September 22, 2003, the Board of Directors of the Company terminated the
  services of LaBonte & Co., Chartered Accountants (“LaBonte”)
  as principal independent accountant for the Company. The termination of LaBonte
  is a result of consummation of the merger between Transax Limited and Vega-Atlantic
  Corporation and the subsequent decision by the Board of Directors that it would
  be in the best interests of the Company to effect a change in auditors to the
  current auditors of Transax Limited. During the Company’s two most recent
  fiscal years and any subsequent interim period preceding the resignation of
  LaBonte, there were no disagreements with LaBonte which were not resolved on
  any matter concerning accounting principles or practices, financial statement
  disclosure, or auditing scope or procedure, which disagreements, if not resolved
  to the satisfaction of LaBonte, would have caused LaBonte to make reference
  to the subject matter of the disagreements in connection with its reports. The
  report of LaBonte for fiscal year ended March 31, 2003 indicated the following:
“In the United States, reporting standards for auditors would require
  the addition of an explanatory paragraph following the opinion paragraph when
  the financial statements are affected by conditions and events that cast substantial
  doubt on the Company’s ability to continue as a going concern, such as
  those described in Note 1. Our report to the stockholders and Board of Directors
  dated June 3, 2002 is expressed in accordance with Canadian reporting standards
  which do not permit a reference to such conditions and events in the auditors’
  report when these are adequately disclosed in the financial statements.”
Except as described in the immediately preceding paragraph, the report of LaBonte
  did not contain an adverse opinion or a disclaimer of opinion, and was not qualified
  or modified as to uncertainty, audit scope, or accounting principles.
  On September 22, 2003, the Board of Directors of the Company approved and authorized
  the engagement of Moore Stephens, P.C., 708 Third Avenue, New York, New York
  10017-5102 as the principal independent accountant for the Company.
**ITEM 8A. Controls and Procedures**Table of Contents
The Company, under the supervision of the President, has conducted an evaluation
  of the effectiveness of the design and operation of the Company’s disclosure
  controls and procedures within ninety (90) days of the filing date of this Annual
  Report. Based upon the results of this evaluation, the Company believes that
  they maintain proper procedures for gathering, analyzing and disclosing all
  information in a timely fashion that is required to be disclosed in its reports
  under the Securities Exchange Act of 1934, as amended. There have been no significant
  changes in the Company’s controls subsequent to the evaluation date.
There were no significant changes in the Company’s internal control or
  in other factors that could significantly affect the Company’s internal
  controls subsequent to the evaluation date.

**PART III**Table of Contents**ITEM 9. Directors, Executive Officers, promoters and control persons;
  Compliance with 16(a) of the Exchange Act**Table of Contents
**Identification of Directors and Executive Officers**
As of the date of this Annual Report, the directors and executive officers of
  the Company are as follows:
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|**Name**                                                                                                                                            | **Age** | **Position**                                    
|--------------------------------------------------------------------------------------------------------------------------------------------------- | ------- | ------------------------------------------------
|Stephen Walters                                                                                                                                     | 45      | President / Chief Executive Officer and Director
|Nathalie Pilon, cma                                                                                                                                 | 36      | Chief Financial Officer / Secretary             
|Laurie Bewes, BBA                                                                                                                                   | 52      | Director                                        
|David M. Bouzaid                                                                                                                                    | 49      | Director                                        
|Graeme W. Smith                                                                                                                                     | 46      | Vice President and Director (1)                 
|(1) As of the date of this Annual Report, Mr. Smith has advised the Company that he will be tendering
				his resignation effective April 22, 2004.

|**Biographies of Officers and Directors**
STEPHEN WALTERS is the President, Chief Executive Officer and a director
  of the Company. Mr. Walters currently is the President, Chief Executive Officer
  and a director of Transax. Mr. Walters has more than 15 years of business experience
  in the Asia-Pacific Region. He is responsible for corporate development initiatives
  that have seen a successful restructuring of the predecessor company. Mr. Walters
  is also the founder and principal of the Carlingford Group of companies based
  in Singapore. In the past twenty-four months, Mr. Walters has raised over $6,000,000
  for investment in promising early stage technology companies principally from
  North America and to expand their operations to the Asia-Pacific region through
  the establishment of joint ventures with strategic partners and licensing arrangements.
  The Carlingford Group focuses on companies in the biomedical, computer network
  and wireless telecommunications industries. Mr. Walters possesses an in depth
  knowledge of the public markets having previously acted as President and Chief
  Executive Officer of a US public company. Mr. Walters currently is a director
  of a number of private companies in Canada and Singapore.
NATHALIE PILON is the Chief Financial Officer and Secretary of the Company.
  Ms. Pilon is currently the Chief Financial Officer of Transax. Prior to joining
  Transax, Ms. Pilon held the position of Chief Financial Officer for MIV Therapeutics
  Inc., a NASD OTC Bulletin Board company. In addition, Ms. Pilon has gained significant
  experience in finance, accounting and strategic planning while acting as Financial
  Officer for Syreon Corporation, and as Financial Controller for various biotech
  and high tech public development stage companies such as Lorus Therapeutics,
  Inc. and Chromos Molecular Systems. Over the past few years, Ms. Pilon has also
  consulted with exploration stage companies such as Olympic Resources, Petrogen
  Corp. and Ross River Minerals. Ms. Pilon holds a CMA designation and obtained
  her bachelor's degree in Business Administration from Sherbrooke University
  in 1990.
LAURIE BEWES is a director of the Company. Mr. Bewes currently is a director
  of Transax. Mr. Bewes has a Bachelor of Business Administration (RMIT) and is
  a member of the Australian Institute of Company Directors (MAICD). His business
  background over the past 20 years includes joint ventures, business development,
  mergers, infrastructure privatization and start-ups across South America (Argentina
  and Brazil), Asia (Indonesia, Singapore and Malaysia) and Australia/New Zealand.
  Mr. Bewes has worked in various senior executive positions for companies such
  as P & O, ANL and TNT.
DAVID BOUZAID is a director of the Company. Mr. Bouzaid currently is
  a director of Transax. Mr. Bouzaid has accumulated 27 years’ experience
  in the health insurance industry within Asia and the Australasia region. Mr.
  Bouzaid specializes in New Business Development within the health insurance
  industry and over the past four years he has gained a wealth of experience in
  Global Healthcare Insurance. Mr. Bouzaid is currently regional director (Asia-Pacific)
  for Interglobal Insurance Services Ltd. based in Bangkok, Thailand.

**Involvement in Certain Legal Proceedings**
As of the date of this Annual Report, no director or executive officer of the
  Company is or has been involved in any legal proceeding concerning (i) any bankruptcy
  petition filed by or against any business of which such person was a general
  partner or executive officer either at the time of the bankruptcy or within
  two years prior to that time; (ii) any conviction in a criminal proceeding or
  being subject to a pending criminal proceeding (excluding traffic violations
  and other minor offenses) within the past five years; (iii) being subject to
  any order, judgment or decree permanently or temporarily enjoining, barring,
  suspending or otherwise limiting involvement in any type of business, securities
  or banking activity; or (iv) being found by a court, the Securities and Exchange
  Commission or the Commodity Futures Trading Commission to have violated a federal
  or state securities or commodities law (and the judgment has not been reversed,
  suspended or vacated).
**Audit Committee**
As of the date of this Annual Report, the Company has not appointed members
  to an audit committee and, therefore, the respective role of an audit committee
  has been conducted by the Board of Directors of the Company. When established,
  the audit committee's primary function will be to provide advice with respect
  to the Company's financial matters and to assist the Board of Directors in fulfilling
  its oversight responsibilities regarding finance, accounting, tax and legal
  compliance. The audit committee's primary duties and responsibilities will be
  to: (i) serve as an independent and objective party to monitor the Company's
  financial reporting process and internal control system; (ii) review and appraise
  the audit efforts of the Company's independent accountants; (iii) evaluate the
  Company's quarterly financial performance as well as its compliance with laws
  and regulations; (iv) oversee management's establishment and enforcement of
  financial policies and business practices; and (v) provide an open avenue of
  communication among the independent accountants, management and the Board of
  Directors.
The Board of Directors has considered whether the regulatory provision of non-audit
  services is compatible with maintaining the principal independent accountant's
  independence.

**Audit Committee Financial Expert**
As of the date of this Annual Report, the Board of Directors of the Company
  has determined that the Company does not have an audit committee financial expert
  nor does the Company have an audit committee.
**Compliance with Section 16(a) of the Exchange Act**
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires the
  Company’s directors and officers, and the persons who beneficially own
  more than ten percent of the Common Stock of the Company, to file reports of
  ownership and changes in ownership with the Securities and Exchange Commission.
  Copies of all filed reports are required to be furnished to the Company pursuant
  to Rule 16a-3 promulgated under the Exchange Act. Based solely on the reports
  received by the Company and on the representations of the reporting persons,
  the Company believes that these persons have complied with all applicable filing
  requirements during the fiscal year ended December 31, 2003.

**ITEM 10. EXECUTIVE COMPENSATION**Table of Contents
**Compensation of Officers and Directors**
As of the date of this Annual Report, certain of the Executive Officers or Directors
  of the Company are compensated for their roles as Managing Directors or Executive
  Officers of the Company. Officers and Directors of the Company are reimbursed
  for any out-of-pocket expenses incurred by them on behalf of the Company. None
  of the Company's Directors or Executive Officers are party to written employment
  or consulting agreements with the Company. The Company has, however, informal
  month-to-month verbal agreements with certain Officers or Directors. However,
  as of the date of this Annual Report, Mr. Walters and Ms. Pilon derive remuneration
  from the Company as compensation for consulting services rendered. See “Summary
  Compensation Table”. Officers and directors of the Company are reimbursed
  for any out-of-pocket expenses incurred by them on behalf of the Company. The
  Company presently has no pension, health, annuity, insurance, profit sharing
  or similar benefit plans.
Walters Consulting Agreement
The Company and Stephen Walters, the President/Chief Executive Officer and a
  director of the Company, entered into a verbal month-to-month consulting services
  agreement (the "Walters Consulting Agreement"). Pursuant to the terms
  and provisions of the Walters Consulting Agreement: (i) Mr. Walters agreed to
  provide managerial services to the Company; and (ii) Mr. Walters shall be paid
  a monthly fee of $11,000.00 US Dollars for a potential annual salary of $132,000.00,
  and reimbursement of expenses.
  During fiscal year ended December 31, 2003, an aggregate of $ 132,000 in consulting
  fees was incurred to Mr. Walters for services rendered by Mr. Walters to the
  Company under the Walters Consulting Agreement. During fiscal year ended December
  31, 2003, the Company paid $48,375 to Mr. Walters as compensation for services
  rendered to the Company under the Walters Consulting Agreement. As of December
  31, 2003, an aggregate amount of $83,625 and $57,900 for expenses remain
  due and owing to Mr. Walters by the Company. See “Item 10. Executive Compensation”
  and “Item 12. Certain Relationships and Related Transactions.”
Smith Consulting Agreement
The Company and Graeme Smith, the prior Vice President and a prior director of the Company,
  entered into a verbal month-to-month consulting services agreement (the "Smith
  Consulting Agreement"). Pursuant to the terms and provisions of the Smith
  Consulting Agreement: (i) Mr. Smith agreed to provide technical and managerial
  services to the Company; and (ii) Mr. Smith shall be paid a per diem fee of
  $450.00 US Dollars, and reimbursement of expenses.
During fiscal year ended December 31, 2003, an aggregate of $30,755 in consulting
  fees was incurred to Mr. Smith for services rendered by Mr. Smith to the Company
  under the Smith Consulting Agreement. During fiscal year ended December 31,
  2003, the Company paid $24,355 to Mr. Smith as compensation for services rendered
  to the Company under the Smith Consulting Agreement. As of December 31, 2003,
  an aggregate amount of $ 6,400 and $ 3,100 for expenses remain due and owing
  to Mr. Smith by the Company. See “Item 10. Executive Compensation”
  and “Item 12. Certain Relationships and Related Transactions.”
As of the date of this Annual Report, Mr. Smith has advised the Company that he will be tendering
his resignation as director and Vice President effective April 22, 2004.Pilon Consulting Agreement
The Company and Nathalie Pilon, the Chief Financial Officer of the Company,
  entered into a verbal month-to-month consulting services agreement (the "Pilon
  Consulting Agreement"). Pursuant to the terms and provisions of the Pilon
  Consulting Agreement: (i) Ms. Pilon agreed to provide financial, administrative
  and managerial services to the Company; and (ii) Ms. Pilon shall be paid a monthly
  fee of $7,500.00 US Dollars (starting September 1, 2003) for a potential annual
  salary of $82,500, and reimbursement of expenses. From January 1, 2003 to February
  28, 2003, MS. Pilon was paid and hourly fee of $75. From March 1, 2003 to August
  31, 2003, Ms. Pilon was paid monthly fee of $4,500.
  During fiscal year ended December 31, 2003, an aggregate of $69,698 in fees
  was incurred to Ms. Pilon for services rendered by Ms. Pilon to the Company
  under the Pilon Consulting Agreement. During fiscal year ended December 31,
  2003, the Company paid $42,975 to Ms. Pilon as compensation for services rendered
  to the Company under the Pilon Consulting Agreement. As of December 31, 2003,
  an aggregate amount of $ 26,700 for consulting fees and $670 for expenses remain
  due and owing to Ms. Pilon by the Company. See “Item 10. Executive Compensation”
  and “Item 12. Certain Relationships and Related Transactions.”
Bewes Consulting Agreement
The Company and Laurie Bewes, a director of the Company, entered into a verbal
  month-to-month consulting services agreement (the "Bewes Consulting Agreement").
  Pursuant to the terms and provisions of the Bewes Consulting Agreement: (i)
  Mr. Bewes agreed to provide managerial and developmental services to the Company;
  and (ii) Mr. Bewes shall be paid a monthly fee of AUD $10,000 (USD approximately $6,600) for a potential
  annual salary of AUD $120,000 (USD approximately $79,200) (starting April 1, 2003), and reimbursement of
  expenses. 
  During fiscal year ended December 31, 2003, an aggregate of USD $ 58,724 in
  fees was incurred to Mr. Bewes for services rendered by Mr. Bewes to the Company
  under the Bewes Consulting Agreement. During fiscal year ended December 31,
  2003, the Company paid $ 43,064 to Mr. Bewes as compensation for services rendered
  to the Company under the Bewes Consulting Agreement. As of December 31, 2003,
  an aggregate amount of $ 15,660 remains due and owing to Mr. Bewes by the Company.
  See “Item 10. Executive Compensation” and “Item 12. Certain
  Relationships and Related Transactions.”

De Castro Consulting Agreement
The Company and Americo De Castro, an executive officer of the subsidiary of
  the Company, entered into a verbal month-to-month consulting services agreement
  (the "De Castro Consulting Agreement"). Pursuant to the terms and
  provisions of the De Castro Consulting Agreement: (i) Mr. De Castro agreed to
  provide technical, research and developmental services to the Company’s
  subsidiary; and (ii) Mr. De Castro shall be paid a monthly fee of $8,000.00
  US Dollars for an aggregate annual salary of $96,000.00, and reimbursement of
  expenses.
  During fiscal year ended December 31, 2003, an aggregate of $ 96,000 in fees
  was incurred to Mr. De Castro for services rendered by Mr. De Castro to the
  Company’s subsidiary under the De Castro Consulting Agreement. During
  fiscal year ended December 31, 2003, the Company paid $ 94,000 to Mr. De Castro
  as compensation for services rendered to the Company’s subsidiary under
  the De Castro Consulting Agreement. As of December 31, 2003, an aggregate amount
  of $2,000 remains due and owing to Mr. De Castro by the Company.
ICI Consulting Agreement
On April 1, 1999 and as renewed on April 1, 2001, the Company and Investor Communications
  International, Inc., a Washington private corporation (“ICI”), entered
  into a two-year consulting agreement. Pursuant to the terms of the consulting
  agreement, ICI performed a wide range of management, administrative, financial,
  and public company services. The consulting agreement was terminated in favor
  of a revised consulting services arrangement entered into commensurate with
  the completion of the Merger Agreement. Mr. Grant Atkins, a prior director and
  executive officer of the Company, derived remuneration from the Company indirectly
  through ICI. Mr. Atkins was contracted by ICI and part of the management team
  provided by ICI to the Company. 
  On July 15, 2003, pursuant to the terms and provisions of the Merger Agreement,
  the Company and ICI entered into a new consulting services agreement (the “ICI
  Consulting Services Agreement”). Pursuant to the provisions of the ICI
  Consulting Services Agreement, ICI provided to the Company such finance and
  general managerial services as determined by the Board of Directors, from time
  to time, and in its sole and absolute discretion, in order to develop the various
  business interests of the Company in the information network solutions industry,
  including the MedLink solution, for a monthly fee of $10,000. Mr. Grant Atkins
  continued to consult directly to ICI and formed part of the management team
  provided by ICI to the Company and derived remuneration from ICI for such services
  rendered to the Company.
  Effective September 30, 2003, the Company accepted the resignation of ICI as
  management consultant to the Company. Therefore, as of September 30, 2003, the
  ICI Consulting Services Agreement was terminated.
  Mr. Grant Atkins, a previous director and executive officer of the Company,
  consulted directly to ICI and formed part of the management team provided by
  ICI to the Company and derived remuneration from ICI for such services rendered
  to the Company. During fiscal year ended December 31, 2003, Mr. Atkins received
  an aggregate of $6,250 from ICI for services provided to the Company pursuant
  to the previous consulting services agreement and the ICI Consulting Agreement.

**Summary Compensation Table**
The Summary Compensation Table below reflects those amounts received as compensation
  by the executive officers and directors of the Company during fiscal years ended
  December 31, 2002 and December 31, 2003 from the Company subsequent to consummation
  of the Merger Agreement and from Transax Limited prior to consummation of the
  Merger Agreement.
The table below outlines the compensation paid to executive officers and directors,
  for the year ended December 31, 2003. The Company presently has no pension,
  health, annuity, insurance, or similar benefit plans.
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | **Annual Compensation** | **Awards**   | **Payout** 
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------- | ------------ | -----------
|**Name and Position**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | **Year**                | **Salary $** | **Bonus $**
|Stephen Walters, President / CEO and Director                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | 2002                    | 0            | 0          
|2003                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 0                       | 0            | 48,375(1)  
|Graeme Smith, Vice President and Director                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | 2002                    | 0            | 0          
|2003                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 0                       | 0            | 24,337(2)  
|Nathalie Pilon, Chief Financial Officer and Secretary                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | 2002                    | 0            | 0          
|2003                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 0                       | 0            | 42,975(3)  
|Laurie Bewes, Director                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | 2002                    | 0            | 0          
|2003                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 0                       | 0            | 43,064(4)  
|David Bouzaid, Director                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | 2002                    | 0            | 0          
|2003                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 0                       | 0            | 0          
|Grant Atkins, Prior President and Director                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | 2002                    | 0            | 0          
|2003                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 0                       | 0            | 17,000(5)  
|(1) Amount  received by Mr. Walters pursuant to the Walters Consulting Agreement.  As of December 31, 2003, an aggregate amount of $83,625 in consulting fees and $57,900 for reimbursement of expenses remains due and owing.

(2) Amount received by Mr. Smith pursuant to the Smith Consulting Agreement. As of December 31, 2003, an aggregate amount of 6,400 in consulting fees and $3,100 for reimbursement of expenses remains due and owing.  As of the date of this Annual Report, Mr. Smith has advised the Company that he will be tendering his resignation effective April 22, 2004.

(3) Amount received by Ms. Pilon pursuant to the Pilon Consulting Agreement. As of December 31, 2003, an aggregate amount of $26,700 for consulting fees and $670 for reimbursement of expenses remains due and owing.

(4) Amount received by Mr. Bewes pursuant to the Bewes Consulting Agreement. As of December 3,1 2003, an aggregate amount of 15,660 for consulting fees remains due and owing.

(5) Grant Atkins received compensation indirectly from the Company pursuant to the contractual relationship between the Company and ICI during fiscal years ended December 31, 2002 and 2003.

|**Stock Option Plan**
Of the 4,500,000 Stock Options granted, 2,056,730 Stock Options have been exercised.
  The table below reflects the Stock Options originally granted to directors,
  executive officers, affiliates or shareholders holding greater than 5% of the
  equity in the Company, and the respective percentage of Stock Options granted
  to such person in relation to the aggregate total of 4,500,000 Stock Options
  granted (without taking into consideration the exercise of any Stock Options.)
  As of the date of this Annual Report, no Stock Options have been exercised by
  any of the executive officers and directors of the Company. See “Aggregate
  Options/SAR Exercises” below.
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|**Name**                      | **Number of Securities Underlying Options** | **Percent of Total Options Granted** | **Exercise Price** | **Date of Expiration**
|----------------------------- | ------------------------------------------- | ------------------------------------ | ------------------ | ----------------------
|                             
|Stephen Walters               | 1,000,000                                   | 22.22%                               | $0.50              | 14-Aug-08             
|Graeme Smith                  | 150,000                                     | 3.33%                                | $0.50              | 14-Aug-08             
|Nathalie Pilon                | 100,000                                     | 2.22%                                | $0.50              | 14-Aug-08             
|Laurie Bewes                  | 200,000                                     | 4.44%                                | $0.50              | 14-Aug-08             
|David Bouzaid                 | 200,000                                     | 4.44%                                | $0.50              | 14-Aug-08             
|Asia Pacific Holdings         | 1,293,270                                   | 28.74%                               | $0.25              | 1-Dec-08              
|International Market Trend AG | 1,206,730                                   | 26.82%                               |                    | 14-Aug-08             
|**Total**                     | 4,150,000                                   | 92%                                  |                    |                       

|Aggregated Options/SAR Exercises
|--------------------------------

|**Name**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | **Shares Acquired on Exercise** | **Value Realised** | **Number of Securities Underlying Unexercised Options** | **Value of Unexercised in-the-money Options**
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------- | ------------------ | ------------------------------------------------------- | ---------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|International Market Trend AG                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | 1,206,730(1)                    | $3,620,190         | 0                                                       | n/a                                          
|Asia Pacific Holdings                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 850,000(2)                      | $173,375           | 355,770                                                 | n/a                                          
|(1) Pursuant to certain Notice and Agreements of Option, certain Designates of IMT have exercised 1,206,730 Stock Options at the exercise price of $0.50 per option to acquire 1,206,730 shares of the Common Stock of the Company. In connection with the exercise of the Stock Options, the shares of Common Stock of the Company were issued to certain Designates who have provided bona fide services to the Company, which services did not include directly or indirectly the promotion or maintenance of a market for the Company's securities nor were rendered in connection with the offer or sale of securities in a capital-raising transaction.
			
(2) Pursuant to certain Notice and Agreements of Option, 87,500 Stock Options have been exercised at $0.50 per share in settlement of debt due and owing to Asia Pacific in the amount of $43,750 by assignment of such debt to certain Designates of Asia Pacific, and 762,500 Stock Options have been exercised at $0.25 per share in settlement of debt due and owing to Asia Pacific in the amount of $190,625 by assignment of such debt to certain Designates of Asia Pacific.   In connection with the exercise of the Stock Options, 850,000 shares of Common Stock of the Company were issued to certain Designates who have provided bona fide services to the Company, which services did not include directly or indirectly the promotion or maintenance of a market for the Company's securities nor were rendered in connection with the offer or sale of securities in a capital-raising transaction;

|**ITEM 11. Security Ownership of Certain Beneficial owners and Management**Table of Contents
As of the date of this Annual Report, there are 15,303,217 shares of Common
  Stock issued and outstanding, and the Company is obliged to issued an additional
  495,000 shares of Common Stock. The following table sets forth information as
  of the Record Date concerning: (i) each person who is known by the Company to
  own beneficially more than 5% of the Company's outstanding Common Stock; (ii)
  each of the Company's executive officers, directors and key employees; and (iii)
  all executive officers and directors as a group. Common Stock not outstanding
  but deemed beneficially owned by virtue of the right of an individual to acquire
  shares within 60 days is treated as outstanding only when determining the amount
  and percentage of Common Stock owned by such individual. Except as noted, each
  person or entity has sole voting and sole investment power with respect to the
  shares of Common Stock shown.
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|**Title of Class**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | **Name and Address of Beneficial Owner**                                                              | ****    | **Amount and Nature of beneficial Ownership** | **Percent of Class**
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------- | ------- | --------------------------------------------- | --------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|Common Stock                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | Cardlink Worldwide, Inc
				#5 - 2330 NW 102nd AVE
				Miami, Florida 33172                           | (1) (2) | 1,191,870                                     | 7.79%               
|Common Stock                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | Stephen Walters
				Bali View Block A4/7
				Jl. Cirendeu Raya 40
				Jakarta Selatan 13419 Indonesia | (1) (3) | 6,100,846                                     | 32.10%              
|Common Stock                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | Carlingford Investments, Ltd
				80 Raffles Place #16-20 UOB Plaza II
				Singapore, 048624           | (1) (4) | 1,000,000                                     | 6.53%               
|Common Stock                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | Graeme Smith
				25 South Harper's Road
				Woodend, Victoria, Australia 3442                         | (1) (5) | 150,000                                       | 0.97%               
|Common Stock                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | Nathalie Pilon
				2919 Ontario Street
				Vancouver, BC, Canada, V5T 2Y5                             | (1) (6) | 150,000                                       | 0.97%               
|Common Stock                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | Laurie Bewes
				429 Willawrong Road
				Caringbah, Australia, NSW, 2229                              | (1) (7) | 425,000                                       | 2.74%               
|Common Stock                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | David Bouzaid
				Jl. Bangka 7 Dalam No.3A
				Kemang, Jakarta Selatan 12730
				Indonesia            | (1) (8) | 250,000                                       | 1.61%               
|Common Stock                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | All officers and directors as a group (5 persons)                                                     | (9)     | 7,075,846                                     | 36.00%              
|(1) These are restricted shares of Common Stock;

(2) The 1,191,870 shares of Common Stock are held of record by Cardlink Worldwide Inc. as trustee on behalf of all underlying shareholders of Cardlink Worldwide, Inc;

(3) Stephen Walters is an initial founding shareholder of Transax. This figure includes: (a) 9 shares of Common Stock held of record by Mr. Walters; (b) 2,400,837 shares of Common Stock held of record by Carlingford Investments Limited, over which Mr. Walters has sole voting and disposition rights; (c) an assumption of the exercise by Mr. Walters of an aggregate of 1,000,000 Stock Options granted to Mr. Walters to acquire 1,000,000 shares of Common Stock at $0.50 per share expiring on August 14, 2008; and (d) an assumption of the exercise by Carlingford Investments Limited of an aggregate of 2,700,000 warrants held of record by Carlingford Investments Limited, over which Mr. Walters has sole voting and disposition rights, into 2,700,000 shares of Common Stock at a price of $1.00 per share expiring on August 14, 2008;

(4) The 1,000,000 shares of Common Stock are held of record by Carlingford Investments Limited as trustee on behalf of several underlying shareholders of Carlingford Investments Limited;


(5) This figure includes the assumption of the exercise by Mr. Smith of an aggregate of 150,000 Stock Options granted to Mr. Smith to acquire 150,000 shares of Common Stock at $0.50 per share expiring on August 14, 2008. Effective April 14, 2004, Mr. Smith has tendered his resignation as the Vice-President and a director of the Company.

(6) This figure includes: (a) 50,000 shares of Common Stock held of record by Ms. Pilon; and (b) an assumption of the exercise by Ms. Pilon of an aggregate of 100,000 Stock Options granted to Ms. Pilon to acquire 100,000 shares of Common Stock at $0.50 per share expiring on August 14, 2008;

(7) This figure includes: (a) 225,000 shares of Common Stock held of record by Mr. Bewes; and (b) an assumption of the exercise by Mr. Bewes of an aggregate of 200,000 Stock Options granted to Mr. Bewes to acquire 200,000 shares of Common Stock at $0.50 per share expiring on August 14, 2008;


(8) This figure includes: (a) 50,000 shares of Common Stock held of record by Mr. Bouzaid; and (b) an assumption of the exercise by Mr. Bouzaid of an aggregate of 200,000 Stock Options granted to Mr. Bouzaid to acquire 200,000 shares of Common Stock at $0.50 per share expiring on August 14, 2008;

(9) This figure includes: (a) an aggregate of 2,725,846 shares of Common Stock held of record; (b) the assumption of the exercise of an aggregate of 1,650,000 Stock Options to acquire 1,650,000 shares of Common Stock at $0.50 per share expiring on August 14, 2008; and (c) the assumption of the exercise of 2,700,000 warrants to acquire 2,700,000 shares of Common Stock at an exercise price of $1.00 per share expiring on August 14, 2008.

|There are no arrangements or understandings among the entities and individuals
  referenced above or their respective associates concerning election of directors
  or other any other matters which may require shareholder approval.

**ITEM 12. Certain Relationships and Related Transactions**Table of Contents
With the exception of the current month-to-month contractual relations between
  the Company and Messrs. Walters and De Castro and Ms. Pilon as described below,
  as of the date of this Annual Report, the Company has not entered into any contractual
  arrangements with related parties other than those transactions resulting primarily
  from advances made by related parties to the Company. The Board of Directors
  of the Company has not adopted or approved any policy regarding possible future
  transactions with related third parties.
The executive officers and directors of the Company may be engaged in other
  businesses, either individually or through partnerships and corporations in
  which they may have an interest, hold an office or serve on the boards of directors.
  The executive officers and directors of the Company may have other business
  interests to which they may devote a portion of their time. Certain conflicts
  of interest, therefore, may arise between the Company and its executive officers
  and directors. Such conflicts can be resolved through the exercise by such executive
  officers and directors of judgment consistent with their fiduciary duties to
  the Company. The executive officers and directors intend to resolve such conflicts
  in the best interests of the Company. Moreover, the executive officers and directors
  will devote his time to the affairs of the Company as they deem necessary.

**Management Contracts**
Walters Consulting Agreement
The Company and Stephen Walters, the President/Chief Executive Officer and a
  director of the Company, entered into the Walters Consulting Agreement. Pursuant
  to the terms and provisions of the Walters Consulting Agreement: (i) Mr. Walters
  agreed to provide managerial services to the Company; and (ii) Mr. Walters shall
  be paid a monthly fee of $11,000.00 US Dollars for a potential annual salary
  of $132,000.00, and reimbursement of expenses.Pilon Consulting Agreement
The Company and Nathalie Pilon, the Chief Financial Officer of the Company,
  entered into the Pilon Consulting Agreement. Pursuant to the terms and provisions
  of the Pilon Consulting Agreement: (i) Ms. Pilon agreed to provide financial,
  administrative and managerial services to the Company; and (ii) Ms. Pilon shall
  be paid a monthly fee of $7,500.00 US Dollars (starting September 1, 2003) for
  a potential annual salary of $82,500, and reimbursement of expenses. From January
  1, 2003 to February 28, 2003, Ms. Pilon was paid and hourly fee of $75. From
  March 1, 2003 to August 31, 2003, Ms. Pilon was paid monthly fee of $4,500.De Castro Consulting Agreement
The Company and Americo De Castro, an executive officer of the subsidiary of
  the Company, entered into the De Castro Consulting Agreement. Pursuant to the
  terms and provisions of the De Castro Consulting Agreement: (i) Mr. De Castro
  agreed to provide technical, research and developmental services to the Company’s
  subsidiary; and (ii) Mr. De Castro shall be paid a monthly fee of $8,000.00
  US Dollars for an aggregate annual salary of $96,000.00, and reimbursement of
  expenses.

**Indemnification Provisions**
Under Section 7-109-102 of the Colorado Business Corporations Act (the "Colorado
  Act") a corporation may indemnify a person made a party to a proceeding
  because the person is or was a director, against liability incurred in the proceeding.
  Indemnification permitted under this section in connection with a proceeding
  by or in the right of the corporation is limited to reasonable expenses incurred
  in connection with the proceeding.
Indemnification is only possible under this section 7-109-102, however, if:
  (a) the person conducted him/herself in good faith; and (b) the person reasonably
  believed: (i) in the case of conduct in an official capacity with the corporation,
  that his or her conduct was in the corporation's best interests; and (ii) in
  all other cases, that his or her conduct was at least not opposed to the corporation's
  best interests; and (c) in the case of any criminal proceeding, the person had
  no reasonable cause to believe his or her conduct was unlawful.
It should be noted, however, that under Section 7-109-102(4), a corporation
  may not indemnify a director: (i) in connection with a proceeding by or in the
  right of the corporation in which the director is adjudged liable to the corporation;
  or (ii) in connection with any other proceeding in which a director is adjudged
  liable on the basis that he or she derived improper personal benefit.
Under Section 7-109-103 a director is entitled to mandatory indemnification,
  when he/she is wholly successful in the defense of any proceeding to which the
  person was a party because the person is or was a director, against reasonable
  expenses incurred in connection to the proceeding.
Under Section 7-109-105, unless restricted by a corporation's Articles of Incorporation,
  a director who is or was a party to a proceeding may apply for indemnification
  to a court of competent jurisdiction. The court, upon receipt of the application,
  may order indemnification after giving any notice the court considers necessary.
  The court, however, is limited to awarding the reasonable expenses incurred
  in connection with the proceeding and reasonable expenses incurred to obtain
  court-ordered indemnification.
Under Section 7-109-107, unless restricted by the corporation's Articles of
  Incorporation, an officer of a corporation is also entitled to mandatory indemnification
  and to apply for court-ordered indemnification to the same extent as a director.
A corporation may also indemnify an officer, employee, fiduciary or agent of
  the corporation to the same extent as a director.
  Under Section 7-109-108 a corporation may purchase and maintain insurance on
  behalf of a person who is or was a director, officer, employee, fiduciary or
  agent of the corporation against liability asserted against or incurred by the
  person in that capacity, whether or not the corporation would have the power
  to indemnify such person against the same liability under other sections of
  the Colorado Act.
The officers and directors of the Company are accountable to the shareholders
  of the Company as fiduciaries, which means such officers and directors are required
  to exercise good faith and integrity in handling the Company's affairs.
A shareholder may be able to institute legal action on behalf of himself and
  all other similarly situated shareholders to recover damages where the Company
  has failed or refused to observe the law. Shareholders may, subject to applicable
  rules of civil procedure, be able to bring a class action or derivative suit
  to enforce their rights, including rights under certain federal and state securities
  laws and regulations. Shareholders who have suffered losses in connection with
  the purchase or sale of their interest in the Company due to a breach of a fiduciary
  duty by an officer or director of the Company in connection with such sale or
  purchase including, but not limited to, the misapplication by any such officer
  or director of the proceeds from the sale of any securities, may be able to
  recover such losses from the Company.
The Company and its affiliates may not be liable to its shareholders for errors
  in judgment or other acts or omissions not amounting to intentional acts.
Insofar as indemnification for liabilities arising under the Securities Act
  may be permitted to directors, officers and controlling persons of the Company
  pursuant to the foregoing provisions, or otherwise, the Company has been advised
  that in the opinion of the Commission such indemnification is against public
  policy as expressed in the Securities Act and is, therefore, unenforceable.
  In the event that a claim for indemnification against such liabilities (other
  than the payment by the Company of expenses incurred or paid by a director,
  officer or controlling person of the Company in the successful defense or any
  action, suit or proceeding) is asserted by such director, officer or controlling
  person in connection with the securities being registered, the Company will,
  unless in the opinion of its counsel the matter has been settled by controlling
  precedent, submit to a court of appropriate jurisdiction the question whether
  such indemnification by it is against public policy as expressed in the Securities
  Act and will be governed by the final adjudication of such issue.
The Company has no agreements with any of its directors or executive officers
  providing for indemnification of any such persons with respect to liability
  arising out of their capacity or status as officers and directors.
  At present, there is no pending litigation or proceeding involving a director
  or executive officers of the Company as to which indemnification is being sought.

**ITEM 13. Exhibits and Reports on Form 8-K.**Table of Contents
The following exhibits are filed as part of this Annual Report:2.1 Merger Agreement dated July 22, 2003 among the Company,Vega-Atlantic Acquisition
    Corporation, Transax Limited and certain selling shareholders of Transax Limited.
    10.1 Stock Option Plan, effective January 1, 2004. 
    99.1 Certification of Chief Executive Officer Pursuant to Rule 13a-14(a) or
    15d-14(a).
    99.2 Certification of Chief Financial Officer Pursuant to Rule 13a-14(a) or
    15d-14(a).
    99.3 Certifications Under Section 1350 as Adopted Pursuant to Section 906
    of the Sarbanes -Oxley Act.
  Reports on Form 8-K: (i) Report on Form 8-K filed on July 28, 2003; Item 5. Other Events.
    (ii) Report on Form 8-K filed on August 21, 2003; Item 1. Changes in Control
    of Registrant and Item 2. Acquisition of Disposition of Assets.
    (iii) Report on Form 8-K filed on September 25, 2003; Item 4. Changes in Registrant’s
    Certifying Accountant.
    (iv) Report on Form 8-K filed on September 26, 2003; Item 8. Change in Fiscal
    Year
    (v) Report on Form 8-K filed on October 21, 2003; Item 5. Other Events and
    Regulation FD Disclosure and Item 7. Financial Statements.
    (vi) Report on Form 8-K filed on February 24, 2004; Item 9 Regulation FD Disclosure.
    (vii) Report on Form 8-K filed on March 11, 2004; Item 9 Regulation FD Disclosure.**ITEM 14. Professional Accountant Fees and Services**Table of Contents




Audit Fees
During fiscal year ended December 31, 2003, the Company incurred approximately
  $33,900 in fees to its principal independent accountant for professional services
  rendered in connection with preparation and audit of the Company's financial
  statements for fiscal year ended December 31, 2003 and for the review of the
  Company's financial statements for the fiscal quarters ended June 30, 2003 and
  September 30, 2003.
Financial Information Systems Design and Implementation Fees
During fiscal year ended December 31, 2003, the Company did not incur any fees
  for professional services rendered by its principal independent accountant for
  certain information technology services which may include, but is not limited
  to, operating or supervising or managing the Company's information or local
  area network or designing or implementing a hardware or software system that
  aggregate source data underlying the financial statements.
All Other Fees
During fiscal year ended December 31, 2003, the Company did not incur any other
  fees for professional services rendered by its principal independent accountant
  for all other non-audit services which may include, but is not limited to, tax-related
  services, actuarial services or valuation services.

**ITEM 14. Controls and Procedures**
**SIGNATURES**Table of Contents
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.
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Dated : April 14, 2004 | TRANSAX INTERNATIONAL LIMITED
			By : */s/ Stephen Walters*
			--------------------------------------
			Stephen Walters, President and Chief Executive Officer
|---------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------
|Dated : April 14, 2004 | By : */s/ Nathalie Pilon*
			--------------------------------------
			Nathalie Pilon, Chief Financial Officer                                                 

|Table of Contents
|-----------------

---

|**EXHIBIT 2.1**
			
			Merger AgreementBack to Table of Contents
|----------------------------------------------------------------

|**EXHIBIT and SCHEDULE LIST**                                                                                                                                                                                     
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|**Exhibits attached**                                                                                                                                                                                             
|Exhibit A:
Exhibit B:
Exhibit C:
Exhibit D:
Exhibit E:
Exhibit F:
Exhibit G:
Exhibit H:
Exhibit I:                                                                                                                
|**Transax Schedules**                                                                                                                                                                                             
|Schedule 2.2:
Schedule 2.4:
Schedule 2.6:
Schedule 2.7:
Schedule 2.8(a):
Schedule 2.10:
Schedule 2.11:
Schedule 2.12:
Schedule 2.13:
Schedule 2.15:
Schedule 2.16:
Schedule 2.17:
Schedule 2.18(a):
Schedule 2.19:
|**Vega-Atlantic Schedules**                                                                                                                                                                                       
|Schedule 3.2:
Schedule 3.4:
Schedule 3.6:
Schedule 3.7:
Schedule 3.8(a):
Schedule 3.10:
Schedule 3.12:
Schedule 3.13:
Schedule 3.14:
Schedule 3.15:
Schedule 3.17:                                                
|**Vega-Atlantic Schedules**                                                                                                                                                                                       
|Schedule 3.18:
Schedule 3.19:
Schedule 3.20(a):
Schedule 3.20(b):
Schedule 3.20(c):
Schedule 3.20(d):
Schedule 3.21(a):
Schedule 3.22:
Schedule 3.23:
Schedule 3.24:
Schedule 3.28:                               

---

|**MERGER AGREEMENT**
**NOW THEREFORE THIS AGREEMENT WITNESSETH THAT:**
**A. WHEREAS,** in accordance with the terms and conditions of
  that certain “Agreement In Principle” dated for reference June 19,
  2003 (the “Agreement In Principle”), as entered into among Vega-Atlantic,
  Transax and certain selling shareholders of Transax (collectively, the “Selling
  Shareholders”), Vega-Atlantic and Transax therein agreed to use their
  best efforts to initiate, complete and enter into a formal agreement whereby
  Newco would merge with Transax, such that Transax would become a wholly-owned
  subsidiary of Vega-Atlantic, and such that the shareholders, warrantholders
  and optionholders of Transax would become, on an equivalent basis, shareholders,
  warrantholders and optionholders of Vega-Atlantic; a copy of which Agreement
  In Principle being attached hereto as Exhibit A; and the parties hereto have
  agreed to enter into this Agreement which formalizes and replaces, in its entirety,
  the Agreement In Principle, as contemplated and required by the terms of the
  Agreement In Principle, and which clarifies their respective duties and obligations
  in connection with the proposed merger as between Transax and Newco;
**B. AND WHEREAS,** upon the terms and subject to the conditions
  of this Agreement, Newco will merge with and into Transax (the “Merger”)
  as a result of which the shareholders of Transax collectively will own 11,066,207
  shares (collectively, the “Vega-Atlantic Shares”) of the common
  stock (the “Vega-Atlantic Common Stock”), with a par value of $0.00001,
  of Vega-Atlantic, together with stock options to acquire up to 4,500,000 shares
  of Vega-Atlantic Common Stock (collectively, the “Vega-Atlantic Options”)
  of Vega-Atlantic and non-transferable share purchase warrants to acquire up
  to a further 4,100,000 shares of Vega-Atlantic Common Stock (collectively, the
  “Vega-Atlantic Warrants”);
**C. AND WHEREAS,** the Board of Directors of Transax has determined
  that the Merger is fair to, and in the best interests of, Transax and its shareholders;
  has approved and adopted this Agreement and the transactions contemplated herein;
  and this Agreement and the transactions contemplated herein are to be approved
  by the shareholders of Transax;
**D. AND WHEREAS,** and in accordance with the terms and conditions
  of the Agreement In Principle, it was determined that, should the final terms
  and conditions of any Merger not be approved by the shareholders of Transax
  at any duly constituted meeting respecting the same, or should any formal Merger
  not be consummated by the parties hereto in the manner which is contemplated
  herein and therein for any reason whatsoever and including, without limitation,
  the implementation of any dissenters’ rights which are not acceptable
  to Vega-Atlantic or Transax resulting from the same, it is hereby acknowledged
  and understood that, notwithstanding the prior failure of the proposed Merger,
  each of the undersigned and controlling shareholders of Transax, together with
  each of their respective and associated and affiliated shareholders of Transax
  as the case may be (collectively, the “Selling Shareholders”), have
  hereby and thereby irrevocably agreed to assign, sell and transfer all of their
  respective right, entitlement and interest in and to their respective Transax
  Shares to Vega-Atlantic on a pro rata basis;
**E. AND WHEREAS,** the Board of Directors of Vega-Atlantic has
  determined that the Merger is in the best interests of Vega-Atlantic and its
  shareholders and has approved and adopted this Agreement and the transactions
  contemplated herein;
**F. AND WHEREAS,** the Board of Directors of Newco has determined
  that the Merger is in the best interests of Newco and its shareholder; and the
  Board of Directors of Newco and Vega-Atlantic, as the sole shareholder of Newco,
  have approved and adopted this Agreement and the transactions contemplated herein;
**G. AND WHEREAS,** for federal income tax purposes, it is intended
  that the Merger qualify as a reorganization under the provisions of section
  368(a) of the United States Internal Revenue Code of 1986, as amended (the “Code”),
  and that this Agreement and the Annexes hereto shall constitute a “plan
  of reorganization” for the purposes of section 368 of the Code;
**NOW, THEREFORE,** in consideration of the premises and the mutual
  covenants and agreements herein contained, and intending to be legally bound
  hereby, Vega-Atlantic, Newco and Transax hereby agree as follows:

**Article I
  THE MERGER AND MATERIAL TERMS AND EFFECT OF THE MERGER**
**1.1 The Merger.** Upon the terms and subject to
  the conditions set forth in this Agreement, and in accordance with Article 111
  of the Colorado *Business Corporation Act* (the “*CBCA*”),
  at the Effective Time (as defined in Section 1.2 hereinbelow), Newco and Transax
  shall effect a merger by executing the “Agreement and Plan of Merger”
  (the “*Plan*”) in substantially the form attached hereto
  as Exhibit B, and by filing “Articles of Merger” substantially
  in the form attached hereto as Exhibit C, with the Secretary of State
  of Colorado in such form as required by, and executed in accordance with the
  relevant provisions of Article 111 of the CBCA. As a result of the Merger the
  separate corporate existence of Newco shall cease and Transax shall continue
  as the surviving corporation in the Merger (the “*Surviving Corporation*”).
  The name of the Surviving Corporation shall be “Transax Limited”
  or such other name as the Board of Directors of the Surviving Corporation may
  select subsequent to the Effective Time. Prior to the Merger Vega-Atlantic shall,
  pursuant to the terms of the “Contribution Agreement”; a copy of
  which is attached hereto as Exhibit D (the “*Contribution Agreement*”);
  issue and deliver to Newco shares, warrants and options of Vega-Atlantic Common
  Stock equivalent to the final number of Vega-Atlantic Shares, Vega-Atlantic
  Options and Vega-Atlantic Warrants to be transferred to the existing shareholders,
  warrantholders and optionholders of Transax pursuant to the terms and provisions
  of the Plan.
**1.2 Effective Time of the Merger.** As promptly
  as practicable after the approval hereof by the shareholders of Transax and,
  where required, if at all, by any of the other Constituent Corporations, and
  the execution and delivery of this Agreement by each of the parties hereto,
  but in no event after August 31, 2003, the parties hereto each shall cause the
  Merger to be consummated by filing Articles of Merger with the Secretary of
  State of Colorado in such form as required by, and executed in accordance with
  the relevant provisions of, Article 111 of the CBCA. The Merger shall become
  effective at such time as the Secretary of State of Colorado accepts for filing
  the Articles of Merger or at such later time pursuant to the mutual agreement
  of Newco and Transax (the “*Effective Time*”).
**1.3 Capitalization of Transax for conversion.**
  The authorized capital stock of Transax consists of 100,000,000 shares of the
  common stock of Transax, no par value (the “*Transax Common Stock*”),
  of which 22,132,414 common shares of Transax (collectively, the “*Transax
  Shares*”) are outstanding and no shares are held in Transax’s
  treasury. Except as set forth above in this Section, there are outstanding:
  (i) no shares of capital stock or other voting securities of Transax; (ii) no
  securities of Transax convertible into or exchangeable for shares of capital
  stock or other voting securities of Transax; (iii) except for the presently
  issued and outstanding stock options to acquire up to 9,000,000 shares of Transax
  Common Stock (collectively, the “*Transax Options*”; which
  will be cancelled and exchanged for the Vega-Atlantic Options upon the Effective
  Time hereunder), and except for the presently issued and outstanding non-transferable
  share purchase warrants to acquire up to 8,200,000 shares of Transax Common
  Stock (collectively, the “*Transax Warrants*”; which will
  also be cancelled and exchanged for the Vega-Atlantic Warrants upon the Effective
  Time hereunder), no other options or other rights to acquire from Transax, and
  no obligation of Transax to issue or sell, any shares of capital stock or other
  voting securities of Transax or any securities of Transax convertible into or
  exchangeable for such capital stock or voting securities; and (iv) no equity
  equivalents, interests in the ownership or earnings or other similar rights
  of or with respect to Transax. For the purposes of this Agreement the Transax
  Shares, Transax Options and Transax Warrants shall collectively be referred
  to as the “Transax Securities”.
**1.4 Conversion of Transax Securities.** At the
  Effective Time, by virtue of the Merger and without any action on the part of
  Newco, Transax or the holders of any of the following securities:
Each two Transax Shares of Transax Common Stock issued and outstanding immediately
    prior to the Effective Time, excluding any treasury shares held by Transax,
    shares held by Vega-Atlantic and Dissenting Shares (as defined in Section
    1.7), if any, shall be converted into the right to receive one Vega-Atlantic
    Share (the “*Common Stock Exchange Ratio*”) of fully paid
    and non-assessable shares of Vega-Atlantic Common Stock and, where applicable,
    rounded up to the nearest whole number of Vega-Atlantic Shares of Vega-Atlantic
    Common Stock consequent thereon
  Each two Transax Warrants outstanding immediately prior to the Effective
    Time shall be converted into one Vega-Atlantic Warrant to purchase Vega-Atlantic
    Common Stock and, where applicable, rounded up to the nearest whole number
    of Vega-Atlantic Warrants to purchase shares of Vega-Atlantic Common Stock,
    and the per share exercise price for the shares of Vega-Atlantic Common Stock
    issuable upon the exercise of such Vega-Atlantic Warrant shall be the same
    as set forth in the Transax Warrant without any adjustment thereto by the
    Common Stock Exchange Ratio. The date of grant of a Vega-Atlantic Warrant
    issued in exchange for a Transax Warrant shall be deemed to be the date on
    which such Vega-Atlantic Warrant is granted. Vega-Atlantic Warrants issued
    in exchange for Transax Warrants pursuant hereto shall have the same schedule
    of vesting (or acceleration) as applies to such Transax Warrants.
  Each two Transax Options outstanding immediately prior to the Effective
    Time shall be converted into one Vega-Atlantic Option to purchase Vega-Atlantic
    Common Stock and, where applicable, rounded up to the nearest whole number
    of Vega-Atlantic Options to purchase shares of Vega-Atlantic Common Stock,
    and the per share exercise price for the shares of Vega-Atlantic Common Stock
    issuable upon the exercise of such Vega-Atlantic Option shall be the same
    as set forth in the Transax Option without any adjustment thereto by the Common
    Stock Exchange Ratio. The date of grant of a Vega-Atlantic Option issued in
    exchange for a Transax Option shall be deemed to be the date on which such
    Vega-Atlantic Option is granted. Vega-Atlantic Options issued in exchange
    for Transax Options pursuant hereto shall have the same schedule of vesting
    (or acceleration) as applies to such Transax Options.
  All Transax Securities shall no longer be outstanding and shall automatically
    be canceled and retired and shall cease to exist, and each certificate previously
    evidencing any such Transax Securities shall thereafter represent the right
    to receive the Merger Consideration (as defined in Section 1.5(b) below).
    The holders of certificates previously evidencing Transax Securities outstanding
    immediately prior to the Effective Time shall cease to have any rights with
    respect to such Transax Securities, except as otherwise provided herein or
    by law. Such certificates previously evidencing Transax Securities shall be
    exchanged for certificates evidencing Vega-Atlantic Shares, Vega-Atlantic
    Options or Vega-Atlantic Warrants (collectively, the “Vega-Atlantic
    Securities”), as appropriate, issued in consideration therefor in accordance
    with the allocation procedures of this Section and upon the surrender of such
    certificates in accordance with the provisions of Section 1.5.
  All Transax Securities held in the treasury of Transax and all Transax Securities
    owned by Vega-Atlantic or any direct or indirect wholly-owned subsidiary of
    Vega-Atlantic or of Transax immediately prior to the Effective Time shall
    be canceled and extinguished without any conversion thereof and no payment
    shall be made with respect thereto.**1.5 Exchange of Certificates.**
As of the date hereof Newco has deposited, or caused to be deposited, with
    Global Securities Transfer Inc. (the “*Exchange Agent*”),
    for the benefit of the holders of Transax Securities, for exchange in accordance
    with this Article I through the Exchange Agent: (i) certificates evidencing
    such number of Vega-Atlantic Shares of Vega-Atlantic Common Stock equal to
    the Common Stock Exchange Ratio multiplied by the number of Transax Shares
    of Transax Common Stock; (ii) certificates representing such number of Vega-Atlantic
    Warrants equal to the Common Stock Exchange Ratio multiplied by the number
    of Transax Warrants that are equivalent in all other material respects to
    the outstanding Transax Warrants; and (iii) agreements representing Vega-Atlantic
    Options evidencing the right to purchase such number of shares of Vega-Atlantic
    Common Stock equal to the Common Stock Exchange Ratio multiplied by the number
    of shares of Transax Common Stock represented by the Transax Options that
    are equivalent in all other material respects to the outstanding Transax Options.
    The Exchange Agent shall, pursuant to irrevocable instructions, deliver the
    Vega-Atlantic Securities to the holders of the Transax Securities.
  As soon as reasonably practicable after the Effective Time, Transax will
    instruct the Exchange Agent to mail to each holder of record of Transax Securities
    (other than Dissenting Shares) (all Transax Share stock certificates and other
    documents evidencing Transax Warrants and Transax Options being, collectively,
    the “*Certificates*”): (i) a letter of transmittal (which
    shall specify that delivery shall be effected, and risk of loss and title
    to the Certificates shall pass, only upon proper delivery of the Certificates
    to the Exchange Agent and shall be in such form and have such other provisions
    as Transax may reasonably specify); and (ii) instructions for use in effecting
    the surrender of the Certificates in exchange for certificates evidencing
    Vega-Atlantic Securities. Upon surrender of a Certificate for cancellation
    to the Exchange Agent together with such letter of transmittal, duly executed,
    and such other customary documents as may be required pursuant to such instructions,
    the holder of such Certificate shall be entitled to receive in exchange therefor:
    (i) certificates evidencing that number of Vega-Atlantic Shares of Vega-Atlantic
    Common Stock which such holder has the right to receive in respect of the
    Transax Shares of Transax Common Stock multiplied by the Common Stock Exchange
    Ratio; (ii) Vega-Atlantic Warrants evidencing the right to purchase that number
    of shares of Vega-Atlantic Common Stock which such holder has the right to
    receive in respect of Transax Warrants multiplied by the Common Stock Exchange
    Ratio; and (iii) Vega-Atlantic Options evidencing the right to purchase that
    number of shares of Vega-Atlantic Common Stock which such holder has the right
    to receive in respect of Transax Options multiplied by the Common Stock Exchange
    Ratio; in each case in accordance with Section 1.4 (such Vega-Atlantic Shares,
    Vega-Atlantic Warrants and Vega-Atlantic Options being collectively, the “Merger
    Consideration”), and the Certificates so surrendered shall forthwith
    be canceled. In the event of a transfer of ownership of shares of Transax
    Shares, a Transax Warrant or a Transax Option, and which transfer is not registered
    in the transfer records of Transax, a certificate evidencing the proper number
    of Vega-Atlantic Shares of Vega-Atlantic Common Stock, a Vega-Atlantic Warrant
    or a Vega-Atlantic Option, as appropriate, may be issued in accordance with
    this Article I to a transferee if the Certificate evidencing such Transax
    Share, Transax Warrant or Transax Option is presented to the Exchange Agent
    accompanied by all documents required to evidence and effect such transfer
    and by evidence that any applicable stock transfer taxes have been paid. Until
    surrendered as contemplated in this Section 1.5, each Certificate shall be
    deemed at any time after the Effective Time to evidence only the right to
    receive, upon such surrender, the Merger Consideration.
  All Vega-Atlantic Shares, Vega-Atlantic Warrants and Vega-Atlantic Options
    issued upon conversion of Transax Shares, Transax Warrants and Transax Options
    in accordance with the terms hereof shall be deemed to have been issued or
    paid in full satisfaction of all rights pertaining to the previously issued
    and outstanding Transax Shares, Transax Warrants and Transax Options.**1.6 Stock transfer books.** At the Effective Time the stock
  transfer books of Transax shall be closed and there shall be no further registration
  of transfers of shares of Transax Securities thereafter on the records of Transax.
  On or after the Effective Time any Certificates presented to the Exchange Agent
  for any reason shall be converted into the Merger Consideration.
**1.7 Dissenting Shares.** If required under the applicable corporate
  and securities laws of the State of Colorado and the federal laws of the United
  States applicable therein (collectively, the “Colorado Law”), notwithstanding
  any other provisions of this Merger Agreement to the contrary, Transax Securities
  that are outstanding immediately prior to the Effective Time and which are held
  by stockholders who shall have not voted in favor of the Merger or consented
  thereto in writing and who shall have demanded properly in writing payment for
  such Transax Securities in accordance with Colorado Law (collectively, the “Dissenting
  Shares”) shall not be converted into or represent the right to receive
  the Merger Consideration. Such stockholders shall be entitled to receive payment
  for the value of the Transax Securities held by them in accordance with such
  provisions of Colorado Law, except that all Dissenting Shares held by stockholders
  who shall have failed to perfect or who effectively shall have withdrawn or
  lost their rights to payment for such Transax Securities under such provisions
  of Colorado Law shall thereupon be deemed to have been converted into and to
  have become exchangeable, as of the Effective Time, for the right to receive
  Vega-Atlantic Securities, upon surrender, in the manner provided in Section
  1.5, of the certificate or certificates that formerly evidenced such Transax
  Securities. The parties hereby acknowledge and agree that Vega-Atlantic’s
  and Transax’s obligation to consummate the Merger as contemplated by this
  Agreement is subject to the satisfaction or waiver on or prior to the Effective
  Time of the condition that holders of not more than nine point five percent
  (9.5%) of the Transax Securities shall have exercised their right of dissent
  as Dissenting Shares under Colorado Law, and Transax shall provide to Vega-Atlantic
  a certificate of Transax certifying on the Effective Time the number of Dissenting
  Shares and the number of convertible securities in respect of which the holders
  thereof have exercised dissent rights.
**1.8 Adjustment.** In the event of any stock split, combination,
  reclassification, recapitalization, exchange, stock dividend or other distribution
  permitted under this Agreement and payable in Vega-Atlantic Common Stock with
  respect to shares of Vega-Atlantic Common Stock (or if a record date with respect
  to any of the foregoing should occur) during the period between the date of
  the Merger Agreement and the Effective Time, then the Merger Consideration shall
  be appropriately adjusted to reflect such stock split, combination, reclassification,
  recapitalization, exchange, stock dividend or other distribution.
**1.9 Resale restrictions and legending of Certificates.** Transax
  and the Selling Shareholders hereby acknowledge and agree that Vega-Atlantic
  makes no representations as to any resale or other restriction affecting the
  Vega-Atlantic Securities and that it is presently contemplated that the Vega-Atlantic
  Securities will be issued and delivered by Vega-Atlantic through Newco under
  the Merger in reliance upon the registration and prospectus exemptions contained
  in certain sections of the Securities Act or “Regulation S” promulgated
  under the Securities Act which will impose a trading restriction in the United
  States on the Vega-Atlantic Securities for a period of at least 12 months from
  the closing hereof (the “Closing”). In addition, Transax and the
  Selling Shareholders hereby also acknowledge and agree that the within obligation
  of Vega-Atlantic and Newco to issue and deliver the Vega-Atlantic Securities
  pursuant to this Article and the Merger will be subject to Vega-Atlantic being
  satisfied that an exemption from applicable registration and prospectus requirements
  is available under the Securities Act and all applicable securities laws, in
  respect of each particular Transax shareholder, warrantholder and optionholder
  and related Transax Securities and Vega-Atlantic Securities, and Vega-Atlantic
  and Newco shall be relieved of any obligation whatsoever to purchase any Transax
  Securities and to issue Vega-Atlantic Securities in respect of any such Transax
  Shareholder, warrantholder and optionholder where Vega-Atlantic reasonably determines
  that a suitable exemption is not available to it.
Transax and the Selling Shareholders hereby also acknowledge and understand
  that neither the sale of the Vega-Atlantic Securities nor any of the Vega-Atlantic
  Securities themselves have been registered under the Securities Act or any state
  securities laws, and, furthermore, that the Vega-Atlantic Securities must be
  held indefinitely unless subsequently registered under the Securities Act or
  an exemption from such registration is available. Transax and the Selling Shareholders
  also acknowledge and understand that the Certificates representing the Vega-Atlantic
  Securities will be stamped with the following legend (or substantially equivalent
  language) restricting transfer in the following manner:

“The transfer of the securities represented by this certificate is
    prohibited except in accordance with the provisions of Regulation S promulgated
    under the United States Securities Act of 1933, as amended (the “Securities
    Act”), pursuant to registration under the Act or pursuant to an available
    exemption from registration. In addition, hedging transactions involving such
    securities may not be conducted unless in compliance with the Securities Act.”.
or
“The securities represented by this certificate have not been registered
    under the United States Securities Act of 1933, as amended, or the laws of
    any state, and have been issued pursuant to an exemption from registration
    pertaining to such securities and pursuant to a representation by the security
    holder named hereon that said securities have been acquired for purposes of
    investment and not for purposes of distribution. These securities may not
    be offered, sold, transferred, pledged or hypothecated in the absence of registration,
    or the availability of an exemption from such registration. Furthermore, no
    offer, sale, transfer, pledge or hypothecation is to take place without the
    prior written approval of counsel to the company being affixed to this certificate.
    The stock transfer agent has been ordered to effectuate transfers only in
    accordance with the above instructions.”;
and Transax and the Selling Shareholders hereby consent to Vega-Atlantic making
  a notation on its records or giving instructions to the Exchange Agent in order
  to implement the restrictions on transfer set forth and described hereinabove.
Transax and the Selling Shareholders also acknowledge and understand that:
the Shares are restricted securities within the meaning of “Rule
    144” promulgated under the Securities Act;
  the exemption from registration under Rule 144 will not be available in
    any event for at least one year from the date of issuance of the Vega-Atlantic
    Securities, and even then will not be available unless: (i) a public trading
    market then exists for the Vega-Atlantic Common Stock; (ii) adequate information
    concerning Vega-Atlantic is then available to the public; and (iii) other
    terms and conditions of Rule 144 are complied with; and
  any sale of the Vega-Atlantic Securities may be made only in limited amounts
    in accordance with such terms and conditions.Transax and the Selling Shareholders finally acknowledge and understand that,
  without in anyway limiting the acknowledgements and understandings as set forth
  hereinabove, they shall in no event make any disposition of all or any portion
  of the Vega-Atlantic Securities which are being acquired hereunder unless and
  until:
there is then in effect a “Registration Statement” under the
    Securities Act covering such proposed disposition and such disposition is
    made in accordance with said Registration Statement; or
  (i) the Transax Shareholder, warrantholder or optionholder, as the case
    may be, shall have notified Vega-Atlantic of the proposed disposition and
    shall have furnished Vega-Atlantic with a detailed statement of the circumstances
    surrounding the proposed disposition, (ii) the Transax Shareholder, warrantholder
    or optionholder, as the case may be, shall have furnished Vega-Atlantic with
    an opinion of its own counsel to the effect that such disposition will not
    require registration of any such Vega-Atlantic Securities under the Securities
    Act and (iii) such opinion of its counsel shall have been concurred in by
    counsel for Vega-Atlantic and Vega-Atlantic shall have advised the Transax
    Shareholder, warrantholder or optionholder, as the case may be, of such concurrence.**1.10 Interim secured Loan from the Vega-Atlantic to Transax.**It
  is hereby acknowledged and agreed by the parties hereto that, in conjunction
  with and as a condition to the entering into of the Agreement In Principle and
  this Agreement by the parties hereto, Vega-Atlantic has heretofore agreed, in
  accordance with the specific terms and conditions of that certain form of proposed
  “Secured and Convertible Loan Agreement” (the “*Loan Agreement*”)
  in this matter, to be entered into between Vega-Atlantic and Transax prior to
  or concurrently with the execution of this Agreement; a copy of the form of
  said proposed Loan Agreement being attached hereto as Exhibit E; to advance
  by way of a loan or loans to Transax (collectively, the “Loan”)
  the aggregate principal sum of up to U.S. $250,000.00 (the “Principal
  Sum”) within five business days of the due and complete closing of a minimum
  of U.S. $250,000.00 of the proposed Private Placement financing as set forth
  hereinbelow. In this regard, and in accordance with the terms and conditions
  of the proposed Loan Agreement, any such Principal Sum Loan amount will bear
  interest accruing thereon at the rate of ten percent (10%) per annum, compounded
  semi-annually and not in advance (the “Interest”) prior to maturity,
  and any such Principal Sum and Interest will be secured, contemporaneously with
  the advancement of any funds under any such Loan, by way of a fixed and floating
  charge on all of the assets of Transax then ranking pari passu with all existing
  liabilities in and to Transax at that time (collectively, the “Security”).
  In this regard it is hereby also acknowledged and agreed by the parties hereto
  that, upon the completion of the within Merger, it is intended, subject to Vega-Atlantic’s
  prior receipt of appropriate accounting and legal advice, that the Loan will
  simply be forgiven, or become an inter-company account as the situation may
  require.
In order to induce Vega-Atlantic to provide any such Loan under the Loan Agreement
  as contemplated hereinabove, Transax hereby covenants with Vega-Atlantic, with
  the intent that Vega-Atlantic will rely thereon in providing any such Loan and
  in concluding the transactions contemplated thereby, that:
Transax will use any such Principal Sum monies which may be advanced by
    Vega-Atlantic by way of Loan for the sole purpose of advancing the ongoing
    development, marketing and maintenance of Transax’s business interests;
    and
  any such Principal Sum will be advanced by Vega-Atlantic to Transax subject
    to the fulfillment and/or the continuing fulfillment of at least the following
    Security conditions to the sole and absolute satisfaction and discretion of
    Vega-Atlantic:the execution by Transax of formal Loan documentation in form and substance
        satisfactory to Vega-Atlantic and its counsel, acting reasonably; and
      the granting and delivery by Transax to Vega-Atlantic of such Security
        documentation (and including, without limitation, promissory notes and
        security instruments) as may be required by Vega-Atlantic and its counsel,
        acting reasonably, in order to evidence the Loan, together with and all
        other supporting documents required under any such Security documentation.Subject to the prior application of the provisions provided for in section
  “3.5” of the proposed Loan Agreement and as set forth hereinbelow,
  it is hereby acknowledged and agreed by the parties hereto that, in accordance
  with the section “3.4” of the proposed Loan Agreement, Transax will
  covenant to repay to Vega-Atlantic, as required under the terms of the proposed
  Loan Agreement, all Principal Sum monies which are advanced by Vega-Atlantic
  to Transax under the proposed Loan Agreement, together with all outstanding
  Interest accrued thereon, at or before 5:00 p.m. (Blaine, Washington, time)
  on the day which is 90 calendar days from the earlier of one year from the execution
  date of the Loan Agreement and the date upon which Newco’s proposed Merger
  with Transax terminates for any reason whatsoever (herein and therein the “*Final
  Principal Sum Payment Date*”); failing which Vega-Atlantic may immediately
  realize upon any of the Security which has been provided by Transax to Vega-Atlantic
  in accordance with the terms of the proposed Loan Agreement.
It is hereby acknowledged and agreed by the Parties hereto that, in accordance
  with section “3.5” of the proposed Loan Agreement, Transax may prepay
  and redeem any portion of the Principal Sum portion of the Loan in whole or
  in part at any time prior to the Final Principal Sum Payment Date (herein and
  therein the “Right of Redemption”) and in the manner as set forth
  immediately hereinbelow by providing Vega-Atlantic with not less than 30 calendar
  days’ prior written notice (herein and therein the “*Redemption
  Notice*”) of its Right of Redemption intention to redeem and repay
  all or any portion of the Principal Sum and any Interest accrued thereon which
  would be due and owing by Transax to Vega-Atlantic at the end of such 30-day
  period (herein and therein, collectively, the “*Redemption Amount*”)
  (such day at the end of such 30-day period being the “*Redemption Date*”
  and, for clarity, such Redemption Date would be the date to which such Principal
  Sum and Interest would be calculated and due and payable to Vega-Atlantic at
  the close of business, in Blaine, Washington, on such Redemption Date). In order
  to provide such Redemption Notice it is hereby also acknowledged and agreed
  that Transax will be required, at the date of its delivery to Vega-Atlantic
  of the Redemption Notice, to provide to Vega-Atlantic’s solicitors, or
  to such other mutually agreeable holder (herein and therein the “*Escrow
  Holder*”), a certified cheque or bank draft representing the entire
  Redemption Amount and made payable to Vega-Atlantic in funds of the United States,
  or funds by way of wire transfer to such designation as may be directed by Vega-Atlantic
  in its sole and absolute discretion, in the amount of any such Redemption Amount.
  Thereupon, and should the proposed Redemption Amount in fact represent all of
  the Principal Sum and any Interest accrued thereon which would be due and owing
  by Transax to Vega-Atlantic under the proposed Loan Agreement at the Redemption
  Date, then Vega-Atlantic will be required to provide to the Escrow Holder, and
  as soon as reasonably possible after its receipt of the Redemption Notice, all
  such registerable discharges as may be necessary to relieve Transax of any obligation
  to Vega-Atlantic under each of the proposed Loan Agreement and each and every
  other Security instrument already provided by Transax to Vega-Atlantic under
  the terms and conditions of the proposed Loan Agreement (herein and therein,
  collectively, the “*Discharges*”). In this regard, and on
  the second business day subsequent to the Redemption Date, the Escrow Holder,
  if applicable, shall deliver to Vega-Atlantic the Redemption Amount and, only
  if also applicable, to Transax the Discharges, and, unless otherwise directed
  in writing by each of Vega-Atlantic and Transax, to Vega-Atlantic’s and
  Transax’s respective addresses for notice and delivery as set forth on
  the front page of the proposed Loan Agreement. Notwithstanding Transax’s
  prior exercise of its Right of Redemption and/or Vega-Atlantic’s prior
  exercise of its Right of Election as provided for in the proposed Loan Agreement
  and as set forth herein, and notwithstanding the prior repayment to Vega-Atlantic
  by Transax of all or any portion of the entire Redemption Amount and/or the
  prior conversion by Vega-Atlantic of all or any portion of the entire Outstanding
  Indebtedness (as hereinafter defined) for any Equity Interest (as hereinafter
  defined) as also provided for in the proposed Loan Agreement and as set forth
  herein, no such action or actions will, in any manner, and unless this Agreement
  is otherwise terminated for any reason whatsoever prior to the Closing thereof,
  affect the within obligation of each of Vega-Atlantic and Transax to complete
  the proposed Merger as contemplated by the terms and conditions of this Agreement.
Subject to Transax’s prior Right of Redemption as set forth hereinabove
  and in the proposed Loan Agreement, at any time after the Final Principal Sum
  Payment Date as set forth hereinabove, should either this Agreement terminate
  for any reason whatsoever prior to the Closing thereof or should the Final Principal
  Sum Payment Date be otherwise determined at any time subsequent to the advance
  of any Loan under the proposed Loan Agreement, then Vega-Atlantic will have,
  in addition to all of the rights and Security specifically provided for in the
  proposed Loan Agreement, the sole and exclusive right and option, in its sole
  and absolute discretion, to elect (the “*Right of Election*”)
  to convert the entire Principal Sum, Interest or any other sum outstanding under
  any Loan from Transax to Vega-Atlantic as contemplated by the proposed Loan
  Agreement (herein and therein, collectively, the “Outstanding Indebtedness”)
  to a participating and voting interest in and to Transax which is then equivalent
  to that percentage which is equivalent to five percent (5%) multiplied by the
  fraction which has, as its numerator, the Outstanding Indebtedness, and which
  has, as its denominator, U.S. $250,000.00, of the resulting issued and outstanding
  participating and voting common shares of Transax at that time (the “*Equity
  Interest*”). In this regard, and should Vega-Atlantic exercise its
  Right of Election to convert the entire Outstanding Indebtedness outstanding
  into the Equity Interest in and to Transax as set forth immediately hereinabove
  then it is also hereby acknowledged and agreed that Transax will, at all times,
  maintain such Equity Interest percentage ownership position of Vega-Atlantic
  in and to Transax with no dilution whatsoever unless otherwise consented to
  in writing by Vega-Atlantic. In this regard it is hereby acknowledged and agreed
  by the parties hereto that Vega-Atlantic’s Right of Election may only
  be exercised by Vega-Atlantic’s surrender of the proposed Loan Agreement
  and the delivery to the Escrow Holder of a duly executed “Election Form”
  (herein and therein the “*Election Form*”); in substantially
  the form which is attached as Schedule “D” to the proposed Loan
  Agreement; together with such registerable Discharges as may be necessary to
  relieve Transax of any obligation to Vega-Atlantic under the proposed Loan Agreement
  and each and every other Security instrument already provided by Transax to
  Vega-Atlantic under the terms and conditions of the proposed Loan Agreement.
  In conjunction with the Escrow Holder’s receipt of the Election Form and
  Discharges from Vega-Atlantic it is hereby also acknowledged and agreed that
  Transax will then be required to provide to the Escrow Holder, and as soon as
  reasonably possible thereafter, a certificate or certificates representing the
  Equity Interest duly registered to the prior order and direction of Vega-Atlantic
  together with such other documentation or assurances as may be necessary, in
  the sole and absolute discretion of Vega-Atlantic, acting reasonably, in order
  to evidence Transax’s compliance with the terms and conditions of the
  proposed Loan Agreement and including, without limitation, the issuance of such
  Equity Interest as provided for hereunder (herein and therein, collectively,
  the “*Equity Interest Documentation*”). In this regard, and
  on the second business day subsequent to the Escrow Holder’s receipt of
  the Equity Interest Documentation from Transax, the Escrow Holder shall deliver
  to Vega-Atlantic the Equity Interest Documentation and to Transax the Election
  Form and the Discharges, and, unless otherwise directed in writing by each of
  Vega-Atlantic and Transax, to Vega-Atlantic’s and Transax’s respective
  addresses for notice and delivery as set forth on the front page of the proposed
  Loan Agreement. Notwithstanding Transax’s prior exercise of its Right
  of Redemption and/or Vega-Atlantic’s prior exercise of its Right of Election
  as provided for in the proposed Loan Agreement and as set forth herein, and
  notwithstanding the prior repayment to Vega-Atlantic by Transax of all or any
  portion of the entire Redemption Amount and/or the prior conversion by Vega-Atlantic
  of all or any portion of the entire Outstanding Indebtedness for any Equity
  Interest as also provided for in the proposed Loan Agreement and as set forth
  herein, no such action or actions will, in any manner, and unless this Agreement
  is otherwise terminated for any reason whatsoever prior to the Closing thereof,
  affect the within obligation of each of Vega-Atlantic and Transax to complete
  the proposed Merger as contemplated by the terms and conditions of this Agreement.
**1.11 Costs.** It is hereby further acknowledged and agreed by
  the parties hereto that while any portion of any Outstanding Indebtedness is
  outstanding Transax will be, and up to and including either the Closing or the
  termination of either this Agreement will be, directly responsible for and pay
  all fees and expenses and including, without limitation, all legal, accounting,
  sponsorship, regulatory and filing fees and expenses, and otherwise, in connection
  with the preparation and execution of this Agreement, all filings with any regulatory
  authority as may have jurisdiction over any of the parties hereto in conjunction
  with the completion of this Agreement and all documentation necessarily incidental
  thereto; and which fees and expenses shall be added to and form part of the
  Outstanding Indebtedness hereunder.
**1.12 Agreement to sell and to vote by the Selling Shareholders**.
  It is hereby further acknowledged and agreed by the parties hereto that, should
  the final terms and conditions of the Merger not be approved by the shareholders
  of Transax at any duly constituted meeting respecting the same (and, pursuant
  to which, the Selling Shareholders hereby irrevocably agree to vote in favour
  of the Merger at any such duly constituted meeting), or should the proposed
  Merger not be consummated by the parties hereto in the manner which is contemplated
  herein for any reason whatsoever and including, without limitation, the implementation
  of any Dissenting Share rights which are not acceptable to Vega-Atlantic or
  Transax resulting from the same, and notwithstanding the prior failure of the
  proposed Merger, each of the undersigned Selling Shareholders of Transax, together
  with each of their respective and associated and affiliated shareholders of
  Transax as the case may be, have hereby irrevocably agreed to assign, sell and
  transfer all of their respective right, entitlement and interest in and to their
  respective Transax Shares to Vega-Atlantic on a pro rata basis (collectively,
  the “*Private Purchase and Sale*”); the number of such Transax
  Shares to be sold to Vega-Atlantic by the Selling Shareholders being set forth
  in the execution section hereof. Any such Private Purchase and Sale by the Selling
  Shareholders to Vega-Atlantic will structured and completed in accordance with
  the general pro rata Merger Consideration and remaining terms and conditions
  contained in this Agreement.
**1.13 Standstill provisions.** In consideration of the parties’
  within agreement for the proposed Merger and the entering into the terms and
  conditions of this Agreement, each of the parties hereby undertake for themselves,
  and for each of their respective agents and advisors, that they will not until
  the earlier of the Closing or the termination of this Agreement approach or
  consider any other potential purchasers, or make, invite, entertain or accept
  any offer or proposal for the proposed sale of any interest in and to any of
  the Transax Securities, any securities of Vega-Atlantic or Newco or the assets
  or the respective business interests of Transax, Newco or Vega-Atlantic, as
  the case may, or, for that matter, disclose any of the terms of this Agreement,
  without the parties’ prior written consent. In this regard each of the
  parties hereby acknowledges that the foregoing restrictions are important to
  the respective businesses of the parties and that a breach by either of the
  parties of any of the covenants herein contained would result in irreparable
  harm and significant damage to each affected party that would not be adequately
  compensated for by monetary award. Accordingly, the parties hereby agree that,
  in the event of any such breach, in addition to being entitled as a matter of
  right to apply to a court of competent equitable jurisdiction for relief by
  way of restraining order, injunction, decree or otherwise as may be appropriate
  to ensure compliance with the provisions hereof, any such party will also be
  liable to the other parties, as liquidated damages, for an amount equal to the
  amount received and earned by such party as a result of and with respect to
  any such breach. The parties hereby also acknowledge and agree that if any of
  the aforesaid restrictions, activities, obligations or periods are considered
  by a court of competent jurisdiction as being unreasonable, they agree that
  said court shall have authority to limit such restrictions, activities or periods
  as the court deems proper in the circumstances.

**Article II
  REPRESENTATIONS AND WARRANTIES OF TRANSAX**
Transax hereby represents and warrants to Vega-Atlantic and Newco as follows:
**2.1 Corporate organization.**Each of Transax and its Subsidiaries
  is a corporation duly organized, validly existing and in good standing under
  the laws of its incorporating jurisdiction and has all requisite corporate power
  and corporate authority to own, lease and operate its properties and to carry
  on its business as now being conducted.
**2.2 Qualification.** Each of Transax and its Subsidiaries is
  duly qualified or licensed to do business as a foreign corporation and is in
  good standing in each of the jurisdictions set forth in Schedule 2.2 hereinbelow,
  which are all of the jurisdictions in which the business owned, leased or operated
  by it or the conduct of its business requires such qualification or licensing;
  except jurisdictions in which the failure to be so qualified or licensed would
  not, individually or in the aggregate, have a Material Adverse Effect on the
  business, assets, results of operations, condition (financial or otherwise)
  or prospects of Transax and its Subsidiaries considered as a whole.
**2.3 Charter and Bylaws.** Transax has delivered to Vega-Atlantic
  accurate and complete copies of the Articles of Incorporation and Bylaws of
  Transax and its Subsidiaries as currently in effect, and will deliver to Vega-Atlantic,
  not later than five business days prior to the Effective Time: (i) the stock
  records of Transax and its Subsidiaries; and (ii) the minutes of all meetings
  of the Boards of Directors and shareholders of Transax and its Subsidiaries,
  any committees of any such Boards of Directors and all consents in lieu of such
  meetings. Such records, minutes and consents accurately reflect the stock ownership
  of Transax and its Subsidiaries and, in all material respects, all actions taken
  by the Boards of Transax and its Subsidiaries and any committees of such Boards
  of Directors. Neither Transax nor its Subsidiaries is in violation of any provision
  of its Articles of Incorporation or Bylaws, other than violations that, individually
  or in the aggregate, do not and will not have a Material Adverse Effect.
**2.4 Capitalization.** The authorized capital stock of Transax
  consists of 100,000,000 shares of Transax Common Stock, of which 22,132,414
  Transax Shares are outstanding and no shares are held in Transax’s treasury.
  All outstanding Transax Shares of the capital stock of Transax have been validly
  issued and are fully paid and non-assessable, and no Transax Shares of capital
  stock of Transax are subject to, nor have any been issued in violation of, pre-emptive
  or similar rights. All issuances, sales and repurchases by Transax of shares
  of its capital stock have been effected in compliance with all Applicable Laws
  including, without limitation, all applicable federal and state securities laws.
  Except as set forth above in this Section, there are outstanding: (i) no shares
  of capital stock or other voting securities of Transax; (ii) no securities of
  Transax convertible into or exchangeable for shares of capital stock or other
  voting securities of Transax; (iii) except for the presently issued and outstanding
  Transax Options to acquire up to 9,000,000 shares of Transax Common Stock (which
  will be cancelled and exchanged for the Vega-Atlantic Options upon the Effective
  Time hereunder), and except for the presently issued and outstanding non-transferable
  Transax Warrants to acquire up to 8,200,000 shares of Transax Common Stock (which
  will also be cancelled and exchanged for the Vega-Atlantic Warrants upon the
  Effective Time hereunder), no other options or other rights to acquire from
  Transax, and no obligation of Transax to issue or sell, any shares of capital
  stock or other voting securities of Transax or any securities of Transax convertible
  into or exchangeable for such capital stock or voting securities; and (iv) no
  equity equivalents, interests in the ownership or earnings or other similar
  rights of or with respect to Transax. There are no outstanding obligations of
  Transax to repurchase, redeem or otherwise acquire any of the foregoing shares,
  securities, options, equity equivalents, interests or rights. Except for the
  interests of Carlingford Investments Ltd. (“*Carlingford*”)
  in and to Transax which are held in trust for certain underlying investors in
  and to Carlingford, Transax is not a party to, and is not aware of, any voting
  agreement, voting trust, or similar agreement or arrangement relating to any
  class or series of its capital stock.
**2.5 Authority relative to this Agreement.**Transax has the
  full corporate power and corporate authority to execute and deliver this Agreement
  and the Ancillary Documents to which it is a party and, subject to the approval
  of this Agreement by the shareholders of Transax in accordance with Applicable
  Laws and Transax’s Articles of Incorporation, to consummate the transactions
  contemplated hereby and thereby. The execution, delivery and performance by
  Transax of this Agreement and the Ancillary Documents to which it is a party,
  and the consummation by it of the transactions contemplated hereby and thereby,
  have been duly authorized by the Board of Directors of Transax, and no other
  corporate proceedings (other than the approval of this Agreement by the shareholders
  of Transax in accordance with Applicable Laws and Transax’s Articles of
  Incorporation and Bylaws) on the part of Transax are necessary to authorize
  the execution, delivery and performance by Transax of this Agreement and such
  Ancillary Documents and the consummation by it of the transactions contemplated
  hereby and thereby. This Agreement has been duly executed and delivered by Transax
  and, assuming the due authorization, execution and delivery thereof by Vega-Atlantic
  and Newco, constitutes, and each Ancillary Document executed or to be executed
  by Transax has been, or when executed will be, duly executed and delivered by
  Transax and constitutes, or when executed and delivered will constitute, a valid
  and legally binding obligation of Transax enforceable against Transax in accordance
  with its respective terms, except that such enforceability may be limited by:
  (i) applicable bankruptcy, insolvency, reorganization, moratorium and similar
  laws affecting creditors’ rights generally; and (ii) equitable principles
  which may limit the availability of certain equitable remedies (such as specific
  performance) in certain instances. On or prior to the date of this Agreement
  the Board of Directors of Transax has determined to recommend approval of the
  Merger to the shareholders of Transax, and such determination is in effect as
  of the date hereof.
**2.6 Non-contravention.** The execution, delivery, and performance
  by Transax of this Agreement and the Ancillary Documents to which it is a party
  and the consummation by it of the transactions contemplated hereby and thereby
  do not and will not: (i) conflict with or result in a violation of any provision
  of the Articles of Incorporation or Bylaws of Transax; (ii) conflict with or
  result in a violation of any provision of, or constitute (with or without the
  giving of notice or the passage of time or both) a default under, or give rise
  (with or without the giving of notice or the passage of time or both) to any
  right of termination, cancellation or acceleration under, or require any consent,
  approval, authorization or waiver of, or notice to, any party to, any bond,
  debenture, note, mortgage, indenture, lease, contract, agreement or other instrument
  or obligation to which Transax is a party or by which Transax or any of its
  properties or business may be bound or any Permit held by Transax; (iii) result
  in the creation or imposition of any Encumbrance upon the properties, assets
  or business of Transax; or (iv) assuming compliance with the matters referred
  to in Section 2.7, violate any Applicable Laws binding upon Transax, except,
  in the case of clauses (ii), (iii) and (iv) above, for any such conflicts, violations,
  defaults, terminations, cancellations, accelerations or Encumbrances which would
  not, individually or in the aggregate, have a Material Adverse Effect and, except
  in the case of clause (ii) above, for: (A) such consents, approvals, authorizations
  and waivers that have been obtained and are unconditional and in full force
  and effect and such notices that have been duly given; and (B) such consents,
  approvals, authorizations, waivers, and notices that are disclosed on Schedule
  2.6.
**2.7 Governmental approvals.** Except as set forth on Schedule
  2.7, no consent, approval, order or authorization of, or declaration, filing
  or registration with, any Governmental Entity is required to be obtained or
  made by Transax or any of its Subsidiaries in connection with the execution,
  delivery or performance by Transax of this Agreement and the Ancillary Documents
  to which it is a party or the consummation by it of the transactions contemplated
  hereby or thereby, other than: (i) the filing by Transax of Articles of Merger
  with respect to the Merger with the Secretary of State of Colorado in accordance
  with Article 111 of the CBCA; (ii) compliance with any applicable requirements
  of the Securities Act; (iii) compliance with any applicable requirements of
  the Exchange Act; (iv) compliance with any applicable state securities or takeover
  laws; (v) filings with Governmental Entities to occur in the ordinary course
  following the consummation of the transactions contemplated hereby; and (vi)
  such consents, approvals, orders or authorizations which, if not obtained, and
  such declarations, filings or registrations which, if not made, would not, individually
  or in the aggregate, have a Material Adverse Effect.
**2.8 Subsidiaries and capital stock.**
Except as disclosed on Schedule 2.8(a), Transax does not own, directly or
    indirectly, any capital stock or other securities of any corporation or have
    any direct or indirect equity or ownership interest in any other person. Schedule
    2.8(a) discloses the jurisdiction of incorporation of each Transax Subsidiary
    and the authorized and outstanding capital stock or other equity interests
    of each Transax Subsidiary. Each Transax Subsidiary is a corporation duly
    organized, validly existing and in good standing under the laws of the jurisdiction
    of its incorporation. Each Transax Subsidiary has all requisite corporate
    power and corporate authority to own, lease and operate its properties and
    assets and to carry on its business as now being conducted. No actions or
    proceedings to dissolve any Transax Subsidiary are pending.
  All of the outstanding capital stock of each Transax Subsidiary is owned,
    directly or indirectly, by Transax, free and clear of all Encumbrances. All
    outstanding shares of capital stock of each Transax Subsidiary have been validly
    issued and are fully paid and non-assessable. No shares of capital stock of
    any Transax Subsidiary are subject to, nor have any been issued in violation
    of, preemptive or similar rights.**2.9 Financial statements.** Transax has delivered to Vega-Atlantic
  accurate and complete copies of Transax’s audited balance sheet as of
  December 31, 2002 (the “*Transax Balance Sheet Date*”), and
  the related audited statements of income, stockholders’ equity and cash
  flows for the year then ended, and the notes and schedules thereto, together
  with the unqualified reports thereon of Transax’s auditors (collectively,
  the “*Transax Financial Statements*”). The Transax Financial
  Statements: (i) represent actual bona fide transactions; (ii) have been prepared
  from the books and records of Transax in conformity with generally accepted
  accounting principles in the United States (“*US GAAP*”)
  applied on a basis consistent with preceding years throughout the periods involved;
  and (iii) accurately, completely and fairly present in all material respects
  the financial position of Transax and its Subsidiaries as of the respective
  dates thereof and its results of operations and cash flows for the periods then
  ended. All financial projections, forecasts and other forward-looking information
  provided by Transax to Vega-Atlantic were, as of their respective dates, prepared
  in good faith and on a basis that management of Transax believed to be reasonable.
**2.10 Absence of undisclosed liabilities**. Neither Transax nor
  any Subsidiary of Transax has any liability or obligation (whether accrued,
  absolute, contingent, unliquidated or otherwise, whether or not known to Transax,
  and whether due or to become due), except: (i) liabilities reflected on the
  Transax Balance Sheet; (ii) liabilities described in the notes accompanying
  the Transax Financial Statements dated as of December 31, 2002; (iii) liabilities
  that have arisen since the date of the Transax Balance Sheet in the ordinary
  course of business (none of which is a material liability for breach of contract,
  breach of warranty, tort or infringement); (iv) liabilities arising under executory
  contracts entered into in the ordinary course of business (none of which is
  a material liability for breach of contract), (v) liabilities specifically set
  forth on Schedule 2.10; and (vi) other liabilities which, in the aggregate,
  are not material to Transax and its Subsidiaries considered as a whole.
**2.11 Absence of certain changes.** Except as disclosed on Schedule
  2.11, since the Transax Balance Sheet Date: (i) there has not been any change,
  development or event, individually or in the aggregate, that has had, or might
  reasonably be expected to have, a Material Adverse Effect; (ii) the business
  of Transax and its Subsidiaries has been conducted only in the ordinary course
  consistent with past practice; (iii) neither Transax nor any of its Subsidiaries
  has incurred any material liability, engaged in any material transaction or
  entered into any material agreement outside the ordinary course of business
  consistent with past practice; (iv) neither Transax nor any of its Subsidiaries
  has suffered any material loss, damage, destruction or other casualty to any
  of its assets (whether or not covered by insurance); and (v) Transax has not
  taken any of the actions set forth in Section 4.2 except as permitted thereunder.
**2.12 Tax matters.** Except as disclosed on Schedule 2.12:
Transax has (and as of the Effective Time will have) duly filed all federal,
    state, local and foreign Tax Returns required to be filed by or with respect
    to it with the IRS, or other applicable taxing authority, and no extensions
    with respect to such Tax Returns have (or as of the Effective Time will have)
    been requested or granted;
  Transax has (and as of the Effective Time will have) paid, or adequately
    reserved against in the Transax Financial Statements, all Taxes due, or claimed
    by any taxing authority to be due, from or with respect to it, except Taxes
    that are being contested in good faith by appropriate legal proceedings and
    for which adequate reserves have been set aside as disclosed on Schedule 2.12;
  there has been no issue raised or adjustment proposed (and none is pending)
    by the IRS or any other taxing authority in connection with any of the Tax
    Returns;
  Transax has (and as of the Effective Time will have) made all deposits
    required with respect to Taxes;
  the federal income Tax Returns of Transax have been audited by the IRS,
    or other applicable taxing authority, through the taxable year ended December
    31, 2002, and the audit proceedings have been closed and all adjustments settled
    through the taxable year ended December 31, 2002;
  no waiver or extension of any statute of limitations as to any federal,
    state, local or foreign Tax matter has been given by or requested from Transax;
    and
  Transax has not filed a consent under Section 341(f) of the Code.**2.13 Compliance with laws.** Except as disclosed on Schedule
  2.13, each of Transax and its Subsidiaries has complied in all material
  respects with all Applicable Laws, except for non-compliance with such Applicable
  Laws which, individually or in the aggregate, does not and will not have a Material
  Adverse Effect. Neither Transax nor any of its Subsidiaries has received any
  written notice, which has not been dismissed or otherwise disposed of, that
  such person has not so complied. Neither Transax nor any of its Subsidiaries
  is charged or, to the knowledge of Transax, threatened with or, to the knowledge
  of Transax, under investigation with respect to, any violation of any Applicable
  Laws relating to any aspect of the business of Transax or any of its Subsidiaries,
  other than violations which, individually or in the aggregate, do not and will
  not have a Material Adverse Effect.
**2.14 Legal Proceedings.** There are no Proceedings pending or,
  to the knowledge of Transax, threatened against or involving Transax or any
  of its Subsidiaries (or any of its directors or officers in connection with
  the business or affairs of Transax or any of its Subsidiaries) or any properties,
  assets or rights of Transax which, individually or in the aggregate, might reasonably
  be expected to have a Material Adverse Effect. There are no Proceedings pending
  or, to the knowledge of Transax, threatened, seeking to restrain, prohibit or
  obtain damages or other relief in connection with this Agreement or the transactions
  contemplated hereby.
**2.15 Title to assets.** Each of Transax and its Subsidiaries
  has good and defensible title, and in the case of real property insurable title,
  to all properties and assets (real, personal and mixed, tangible and intangible)
  it owns or purports to own and including, without limitation, the properties
  and assets reflected in its books and records and in the Transax Balance Sheet,
  other than those disposed of after the date of such Transax Balance Sheet in
  the ordinary course of business consistent with past practice, free and clear
  of all Encumbrances, except as disclosed on Schedule 2.15, and such imperfections
  or irregularities of title, if any, as: (i) are not substantial in character,
  amount or extent and do not materially detract from the value of the property
  or asset subject thereto; (ii) do not materially interfere with either the present
  or intended use of such property; and (iii) do not, individually or in the aggregate,
  materially interfere with the conduct of Transax’s normal operations.
**2.16 Permits**. Transax and its Subsidiaries hold all Permits
  necessary or required for the conduct of the business of Transax and its Subsidiaries
  as currently conducted. Each of such Permits is in full force and effect, Transax
  and its Subsidiaries are in compliance with all of their respective obligations
  with respect thereto and, to the knowledge of Transax, no event has occurred
  which permits, or with or without the giving of notice or the passage of time
  or both would permit, the revocation or termination of any thereof. Except as
  disclosed on Schedule 2.16, no notice has been issued by any Governmental
  Entity and no Proceeding is pending or, to the knowledge of Transax, threatened,
  with respect to any alleged failure by Transax or any of its Subsidiaries to
  have any Permit.
**2.17 Agreements**.
Set forth on Schedule 2.17 is a list of all the following agreements, arrangements
    and understandings (written or oral, formal or informal) (collectively, for
    purposes of this Section, “agreements”) to which Transax or any
    of its Subsidiaries is a party or by which Transax, any of its Subsidiaries
    or any of their respective properties or assets is otherwise bound: collective bargaining agreements and similar agreements with employees
        as a group;
      employee benefit agreements, trusts, plans, funds, or other arrangements
        of any nature, including those referred to in Section 4.3(e);
      agreements with any current or former shareholder, director, officer,
        employee, consultant or advisor or any affiliate of any such person;
      agreements between or among Transax and any of the Subsidiaries;
      indentures, mortgages, security agreements, notes, loan or credit agreements
        or other agreements relating to the borrowing of money by Transax or any
        Subsidiary or to the direct or indirect guarantee or assumption by Transax
        or any Subsidiary of any obligation of others, including any agreement
        that has the economic effect although not the legal form of any of the
        foregoing;
      agreements relating to the acquisition or disposition of assets, other
        than those entered into in the ordinary course of business consistent
        with past practice;
      agreements relating to the acquisition or disposition of any interest
        in any business enterprise;
      agreements with respect to the lease of real or personal property;
      agreements concerning the management or operation of any real property;
      broker, distributor, dealer, manufacturer's representative, sales, agency,
        sales promotion, advertising, market research, marketing, consulting,
        research and development, maintenance, service and repair agreements;
      license, royalty or other agreements relating to Intellectual Property;
      partnership, joint venture and profit sharing agreements;
      agreements with any Governmental Entity;
      agreements relating to the release or disposal of hazardous material
        (as such term is defined in Section 2.18(b));
      agreements in the nature of a settlement or a conciliation agreement
        arising out of any claim asserted by any other person;
      agreements containing any covenant limiting the freedom of Transax or
        any Subsidiary to engage in any line of business or compete with any other
        person in any geographic area or during any period of time;
      powers of attorney granted by Transax or any Subsidiary in favor of
        any person;
      agreements not made in the ordinary course of business; and
      other agreements, whether or not made in the ordinary course of business,
        that are material to the business, assets, results of operations, condition
        (financial or otherwise) or prospects of Transax. For the purposes of
        this Section 2.17, a “material” agreement shall mean any agreement
        that provides for aggregate payments or receipts in excess of $25,000.00
        during the course of a calendar year.
  Transax has made available to Vega-Atlantic accurate and complete copies
    of the agreements listed on Schedule 2.17 and will provide physical copies
    of each such agreement not later than five business days prior to the Effective
    Time. Each of such agreements is a valid and binding agreement of the parties
    thereto enforceable against them in accordance with its terms. No breach or
    default exists with respect to any of such agreements, and no event has occurred
    which, after the giving of notice or the passage of time or otherwise, will
    result in any such breach or default.
  Neither Transax nor any of its Subsidiaries has received notice of any plan
    or intention of any other party to any agreement to exercise any right of
    offset with respect to, or any right to cancel or terminate, any agreement,
    and Transax does not know of any fact or circumstance that would justify the
    exercise by any such other party of such a right other than the automatic
    termination of such agreement in accordance with its terms. Transax does not
    currently contemplate, or have reason to believe any other person currently
    contemplates, any amendment or change to any agreement, which amendment or
    change could have a Material Adverse Effect.**2.18 Environmental matters.**
Except as disclosed in Schedule 2.18(a) and except for matters that
    in the aggregate would not have a Material Adverse Effect:to the knowledge of Transax, the properties, operations and activities
        of Transax and its Subsidiaries comply with all Applicable Environmental
        Laws (as defined below);
      Transax, its Subsidiaries and the properties, operations and activities
        of Transax and its Subsidiaries are not subject to any existing, pending
        or, to the knowledge of Transax, threatened Proceeding under, or to any
        remedial obligations under, any Applicable Environmental Laws;
      all Permits, if any, required to be obtained by Transax or any of its
        Subsidiaries under any Applicable Environmental Laws in connection with
        any aspect of the business of Transax or its Subsidiaries, including without
        limitation those relating to the treatment, storage, disposal or release
        of a hazardous material (as defined below), have been duly obtained and
        are in full force and effect, and Transax and each of its Subsidiaries
        is in compliance with the terms and conditions of all such Permits;
      each of Transax and its Subsidiaries has satisfied and is currently
        in compliance with all financial responsibility requirements applicable
        to its operations and imposed by any Governmental Entity under any Applicable
        Environmental Laws, and neither Transax nor any of its Subsidiaries has
        received any notice of non-compliance with any such financial responsibility
        requirements;
      to the knowledge of Transax, there are no physical or environmental
        conditions existing on any property or assets owned or leased by Transax
        or any of its Subsidiaries, or resulting from their respective operations
        or activities, past or present, at any location, that would give rise
        to any on-site or off-site remedial obligations under any Applicable Environmental
        Laws;
      to the knowledge of Transax, since the Effective Time of the relative
        requirements of Applicable Environmental Laws, all hazardous materials
        generated by Transax or any of its Subsidiaries, or used in connection
        with its properties, operations or activities have been transported only
        by carriers authorized under Applicable Environmental Laws to transport
        such materials, and have been disposed of only at treatment, storage and
        disposal facilities authorized under Applicable Environmental Laws to
        treat, store or dispose of such materials and, to the knowledge of Transax,
        such carriers and facilities have been and are operating in compliance
        with such authorizations and are not the subject of any existing, pending
        or threatened Proceeding in connection with any Applicable Environmental
        Laws;
      there has been no exposure of any person or property to hazardous materials,
        nor has there been any release of hazardous materials into the environment,
        by Transax, its Subsidiaries or in connection with their properties, operations
        or activities that could reasonably be expected to give rise to any claim
        for damages or compensation; and
      Transax shall make available to Vega-Atlantic all internal and external
        environmental audits and studies and all correspondence on substantial
        environmental matters in the possession of Transax relating to any of
        the current or former properties, operations or activities of Transax
        and its Subsidiaries; provided that Transax shall not be required to make
        available any such audits, studies or correspondence that may be subject
        to the attorney-client privilege or similar privilege.
  For purposes of this Section, “*Applicable Environmental Laws*”
    means any and all Applicable Laws pertaining to health, safety or the environment
    in effect in any and all jurisdictions in which Transax or any of its Subsidiaries
    has conducted operations or activities or owned or leased property and assets
    and including, without limitation, the *Clear Air Act*, as amended,
    the *Comprehensive Environmental Response*, *Compensation and Liability
    Act of 1980*, as amended, the*Rivers and Harbors Act of 1899*,
    as amended, the *Federal Water Pollution Control Act*, as amended,
    the*Occupational Safety and Health Act of 1970*, as amended, the *Resource
    Conservation and Recovery Act of 1976*, as amended, the *Safe Drinking
    Water Act*, as amended, the *Toxic Substances Control Act*, as
    amended, the *Superfund Amendments and Reauthorization Act of 1986*,
    as amended, the *Hazardous Materials Transportation Act*, as amended,
    and other environmental conservation or protection laws. For purposes of this
    Agreement, the term “*hazardous material*” means: (i) any
    substance which is listed or defined as a hazardous substance, hazardous constituent
    or solid waste pursuant to any Applicable Environmental Laws; and (ii) petroleum
    (including crude oil and any fraction thereof), natural gas and natural gas
    liquids.
  The representations and warranties contained in this Section would continue
    to be true and correct following disclosure to the applicable Governmental
    Entities of all relevant facts, conditions and circumstances, if any, pertaining
    to the properties, operations and activities of Transax and its Subsidiaries.**2.19 Insurance**. Set forth on Schedule 2.19 is a list
  and summary description, including risks covered, premium amounts and term of
  policy, of all policies of fire, liability, casualty, life and other insurance
  owned or held by each of Transax and its Subsidiaries. Such policies are in
  full force and effect, are sufficient to satisfy all material requirements of
  Applicable Laws and any agreements, arrangements or understandings to which
  Transax or any of its Subsidiaries is a party, and provide adequate insurance
  coverage for the assets and operations of Transax and its Subsidiaries. All
  premiums due and payable with respect to such policies have been timely paid.
  No notice of cancellation of, or indication of an intention not to renew, any
  such policy has been received by Transax or any of its Subsidiaries. No event
  has occurred nor does any fact or condition exist which would render any of
  such policies void or voidable or subject any of such policies to cancellation
  or termination. Each of Transax and its Subsidiaries has given timely notice
  to the appropriate insurance carrier of all pending or threatened claims against
  it that are insured. Schedule 2.19 also lists all pending and threatened insured
  claims. To the knowledge of Transax, the insurance companies providing the insurance
  listed on Schedule 2.19 are solvent. During the past three years no application
  by Transax or any of its Subsidiaries for insurance with respect to its assets
  or operations has been denied for any reason. To the knowledge of Transax, adequate
  insurance coverage for the assets and operations of Transax and its Subsidiaries
  is provided for.
**2.20 Books and records.** All the books and records of Transax
  and each of its Subsidiaries, including all personnel files, employee data and
  other materials relating to employees, are substantially complete and correct
  in all material respects, have been in all material respects maintained in accordance
  with good business practice and all Applicable Laws and, in the case of the
  books of account, have been in all material respects prepared and maintained
  in accordance with generally accepted accounting principles consistently applied.
  Such books and records accurately and fairly reflect, in reasonable detail,
  all material transactions, revenues, expenses, assets and liabilities of Transax
  and each of its Subsidiaries.
**2.21 Illegal payments.** To the knowledge of Transax, none of
  Transax, any of its Subsidiaries or any director, officer, employee or agent
  of such person has, directly or indirectly, paid or delivered any fee, commission
  or other sum of money or item of property however characterized to any broker,
  finder, agent, government official or other person, in the United States or
  any other country, in any manner related to the business or operations of Transax
  or any of its Subsidiaries, which Transax or any such director, officer, employee
  or agent knows or has reason to believe to have been illegal under any Applicable
  Law.
**2.22 Brokerage fees.** Neither Transax nor any of its affiliates
  has retained any financial advisor, broker, agent or finder, or paid or agreed
  to pay any financial advisor, broker, agent or finder, on account of this Agreement
  or any transaction contemplated hereby.
**2.23 Offerings of securities.** All securities that have been
  offered or sold by Transax or any of its Subsidiaries within the three-year
  period ended on the Transax Balance Sheet Date have been offered and sold pursuant
  to valid exemptions from the Securities Act and applicable state securities
  laws. To the knowledge of Transax, no private offering memorandum or other information
  furnished (whether in writing or orally) to any offeree or purchaser of such
  securities, at the time of delivery of such private offering memorandum or other
  information, contained any untrue statement of a material fact or omitted to
  state any material fact required to be stated therein or necessary in order
  to make the statements contained therein, in light of the circumstances under
  which they were made, not misleading.
**2.24 Disclosure.** No representation or warranty made by Transax
  in this Agreement, and no statement of Transax contained in any document, certificate
  or other writing furnished or to be furnished by Transax pursuant hereto or
  in connection herewith, contains or will contain, at the time of delivery, any
  untrue statement of a material fact or omits or will omit, at the time of delivery,
  to state any material fact necessary in order to make the statements contained
  therein, in light of the circumstances under which they are made, not misleading.
  Transax knows of no matter that has not been disclosed to Vega-Atlantic pursuant
  to this Agreement that has or, so far as Transax can now reasonably foresee,
  will have a Material Adverse Effect. Transax has made available to Vega-Atlantic
  accurate and complete copies of all agreements, documents and other writings
  referred to or listed in this Article II or any Schedule hereto.
**2.25 Representations and warranties as of the Effective Time**.
  The representations and warranties made in this Article II will be true and
  correct in all material respects on and as of the Effective Time with the same
  force and effect as if such representations and warranties had been made on
  and as of the Effective Time, except that any such representations and warranties
  which expressly relate only to an earlier date shall be true and correct as
  of the Effective Time as of such earlier date.
**2.26 No other representations.** Except as and to the extent
  expressly set forth in this Article II, Transax makes no representations or
  warranties whatsoever to Vega-Atlantic or Newco and hereby disclaims all liability
  and responsibility for any representation, warranty, statement or information
  made, communicated or furnished (orally or in writing) to Vega-Atlantic, Newco
  or their representatives (including without limitation any opinion, information,
  projection or advice that may have been or may be provided to Vega-Atlantic
  and/or Newco by any director, officer, employee, agent, consultant or representative
  of Transax or any affiliate thereof).

**Article III
  REPRESENTATIONS AND WARRANTIES OF VEGA-ATLANTIC AND NEWCO**
Vega-Atlantic and Newco hereby jointly and severally represent and warrant
  to Transax as follows:
**3.1 Corporate organization.** Each of Vega-Atlantic, Newco and
  the other Subsidiaries of Vega-Atlantic is a corporation duly organized, validly
  existing and in good standing under the laws of the jurisdiction of its incorporation
  and has all requisite corporate power and corporate authority to own, lease
  and operate its properties and to carry on its business as now being conducted.
  No actions or proceedings to dissolve Vega-Atlantic, Newco or any other Vega-Atlantic
  Subsidiary are pending or, to the knowledge of Vega-Atlantic, threatened.
**3.2 Qualification.** Each of Vega-Atlantic, Newco and the other
  Subsidiaries of Vega-Atlantic is duly qualified or licensed to do business as
  a foreign corporation and is in good standing in each of the jurisdictions set
  forth on Schedule 3.2, which are all the jurisdictions in which the business
  owned, leased or operated by it or the conduct of its business requires such
  qualification or licensing;, except jurisdictions in which the failure to be
  so qualified or licensed would not, individually or in the aggregate, have a
  Material Adverse Effect on the business, assets, results of operations, condition
  (financial or otherwise) or prospects of Vega-Atlantic and its Subsidiaries
  considered as a whole.
**3.3 Charter and Bylaws.** Vega-Atlantic has delivered to Transax
  accurate and complete copies of the Articles of Incorporation and Bylaws of
  Vega-Atlantic and its Subsidiaries as currently in effect, and will deliver
  to Transax not later than five business days prior to the Effective Time: (i)
  the stock records of Vega-Atlantic and its Subsidiaries; and (ii) the minutes
  of all meetings of the Boards of Directors and shareholders of Vega-Atlantic
  and its Subsidiaries, any committees of any such Boards and all consents in
  lieu of such meetings. Such records, minutes and consents accurately reflect
  the stock ownership of Vega-Atlantic and its Subsidiaries and, in all material
  respects, all actions taken by the Boards of Vega-Atlantic and its Subsidiaries
  and any committees of such Boards of Directors. Neither Vega-Atlantic nor its
  Subsidiaries is in violation of any provision of its Articles of Incorporation
  or Bylaws, other than violations that, individually or in the aggregate, do
  not and will not have a Material Adverse Effect.
**3.4 Capitalization of Vega-Atlantic.**
The authorized capital stock of Vega-Atlantic consists of 100,000,000
    common shares of Vega-Atlantic Common Stock, par value U.S. $0.0001, of which
    1,106,778 common shares of Vega-Atlantic Common Stock are outstanding and
    no shares are held in Vega-Atlantic’s treasury. The Board of Directors
    of Vega-Atlantic shall designate 11,066,207 Vega-Atlantic Shares of Vega-Atlantic
    Common Stock to be issued to Newco prior to the Effective Time. The Vega-Atlantic
    Shares shall have the same rights as all other shares of Vega-Atlantic Common
    Stock. All outstanding shares of capital stock of Vega-Atlantic have been
    validly issued and are fully paid and non-assessable, and no shares of capital
    stock of Vega-Atlantic are subject to, nor have any been issued in violation
    of, pre-emptive or similar rights. All issuances, sales and repurchases by
    Vega-Atlantic of shares of its capital stock have been effected in compliance
    with all Applicable Laws, including without limitation applicable federal
    and state securities laws. As of the date hereof no shares of Vega-Atlantic
    Common Stock are reserved for issuance and issuable upon the exercise of outstanding
    employee stock options granted under Vega-Atlantic’s employee stock
    option plan. Except as set forth in this Section, there are (and as of the
    Effective Time there will be) outstanding: (i) no shares of capital stock
    or other voting securities of Vega-Atlantic; (ii) no securities of Vega-Atlantic
    convertible into or exchangeable for shares of capital stock or other voting
    securities of Vega-Atlantic; (iii) no options or other rights to acquire from
    Vega-Atlantic, and no obligation of Vega-Atlantic to issue or sell, any shares
    of capital stock or other voting securities of Vega-Atlantic or any securities
    of Vega-Atlantic convertible into or exchangeable for such capital stock or
    voting securities; and (iv) no equity equivalents, interests in the ownership
    or earnings or other similar rights of or with respect to Vega-Atlantic. There
    are (and as of the Effective Time there will be) no outstanding obligations
    of Vega-Atlantic to repurchase, redeem or otherwise acquire any of the foregoing
    shares, securities, options, equity equivalents, interests or rights. Vega-Atlantic
    is not a party to, and is not aware of, any voting agreement, voting trust
    or similar agreement or arrangement relating to any class or series of its
    capital stock. Set forth on Schedule 3.4 is a list of all holders of options,
    warrants and any other securities that are convertible into or exchangeable
    for shares of Vega-Atlantic Common Stock, including for each holder: (i) the
    number and type of securities held; (ii) the applicable exercise price or
    conversion ratio of such securities; and (iii) the vesting percentage of such
    securities (if applicable).
  The authorized capital stock of Newco consists of 1,000 shares of Common
    Stock, of which 1,000 shares are outstanding. All the outstanding shares of
    capital stock of Newco are owned directly by Vega-Atlantic.**3.5 Authority relative to this Agreement.** Each of Vega-Atlantic
  and Newco has full corporate power and corporate authority to execute and deliver
  this Agreement and the Ancillary Documents to which it is a party and, subject
  to the approval of this Agreement by the shareholder of Newco in accordance
  with Applicable Laws and Newco’s Articles of Incorporation, to consummate
  the transactions contemplated hereby and thereby. The execution, delivery and
  performance by each of Vega-Atlantic and Newco of this Agreement and the Ancillary
  Documents to which it is a party, and the consummation by it of the transactions
  contemplated hereby and thereby, have been duly authorized by the Boards of
  Directors of Vega-Atlantic and Newco, and no other corporate proceedings (other
  than the approval of this Agreement by the shareholders of Newco in accordance
  with Applicable Laws and Newco’s Articles of Incorporation) on the part
  of Newco are necessary to authorize the execution, delivery and performance
  by Newco and Vega-Atlantic of this Agreement and such Ancillary Documents and
  the consummation by it of the transactions contemplated hereby and thereby.
  This Agreement has been duly executed and delivered by each of Vega-Atlantic
  and Newco and, assuming the due authorization, execution and delivery thereof
  by Transax, constitutes, and each Ancillary Document executed or to be executed
  by Vega-Atlantic, Newco or both, has been, or when executed will be, duly executed
  and delivered by Vega-Atlantic or Newco and constitutes, or when executed and
  delivered will constitute, a valid and legally binding obligation of Vega-Atlantic
  and Newco enforceable against Vega-Atlantic and Newco in accordance with its
  respective terms, except that such enforceability may be limited by: (i) applicable
  bankruptcy, insolvency, reorganization, moratorium and similar laws affecting
  creditors’ rights generally; and (ii) equitable principles which may limit
  the availability of certain equitable remedies (such as specific performance)
  in certain instances. On or prior to the date of this Agreement the Board of
  Directors of Newco has determined to recommend approval of the Merger to the
  shareholders of Newco, and such determination is in effect as of the date hereof.
**3.6 Non-contravention.** The execution, delivery and performance
  by Vega-Atlantic and Newco of this Agreement and the Ancillary Documents to
  which either is a party and the consummation by them of the transactions contemplated
  hereby and thereby do not and will not: (i) conflict with or result in a violation
  of any provision of the Articles of Incorporation or Bylaws of Vega-Atlantic
  or Newco; (ii) conflict with or result in a violation of any provision of, or
  constitute (with or without the giving of notice or the passage of time or both)
  a default under, or give rise (with or without the giving of notice or the passage
  of time or both) to any right of termination, cancellation or acceleration under,
  or require any consent, approval, authorization or waiver of, or notice to,
  any party to, any material bond, debenture, note, mortgage, indenture, lease,
  contract, agreement or other instrument or obligation to which Vega-Atlantic
  or Newco is a party or by which Vega-Atlantic or Newco or any of their respective
  properties or assets may be bound or any material Permit held by Vega-Atlantic
  or Newco; (iii) result in the creation or imposition of any Encumbrance upon
  the properties or assets of Vega-Atlantic or Newco; or (iv) assuming compliance
  with the matters referred to in Section 3.7, violate any Applicable Laws binding
  upon Vega-Atlantic or Newco, except, in the case of clauses (ii), (iii), and
  (iv) above, for any such conflicts, violations, defaults, terminations, cancellations,
  accelerations or Encumbrances which would not, individually or in the aggregate,
  have a Material Adverse Effect, and except, in the case of clause (ii) above,
  for: (A) such consents, approvals, authorizations and waivers that have been
  obtained and are unconditional and in full force and effect and such notices
  that have been duly given; and (B) such consents, approvals, authorizations,
  waivers and notices that are disclosed on Schedule 3.6.
**3.7 Governmental approvals**. Except as set forth on Schedule
  3.7, no consent, approval, order or authorization of, or declaration, filing
  or registration with, any Governmental Entity is required to be obtained or
  made by Vega-Atlantic, Newco or any other Subsidiary of Vega-Atlantic in connection
  with their execution, delivery or performance of this Agreement and the Ancillary
  Documents to which either of them is a party or the consummation by them of
  the transactions contemplated hereby or thereby, other than: (i) the filing
  by Newco of Articles of Merger with respect to the Merger with the Secretary
  of State of Colorado and issuance by such Secretary of State of a certificate
  of merger in accordance with the CBCA; (ii) compliance with any applicable requirements
  of the Securities Act; (iii) compliance with any applicable requirements of
  the Exchange Act; (iv) compliance with any applicable requirements of the Trust
  Indenture Act; (v) compliance with any applicable state securities or takeover
  laws; (vi) filings with Governmental Entities to occur in the ordinary course
  following the consummation of the transactions contemplated hereby; and (vii)
  such consents, approvals, orders or authorizations which, if not obtained, and
  such declarations, filings or registrations which, if not made, would not, individually
  or in the aggregate, have a Material Adverse Effect.
**3.8 Subsidiaries and capital stock.**
Except as disclosed on Schedule 3.8(a), Vega-Atlantic does not own, directly
    or indirectly, any capital stock or other securities of any corporation or
    have any direct or indirect equity or ownership interest in any other person.
    Also disclosed on Schedule 3.8(a) is the jurisdiction of incorporation of
    each Vega-Atlantic Subsidiary and the authorized and outstanding capital stock
    or other equity interests of each Vega-Atlantic Subsidiary. Each Vega-Atlantic
    Subsidiary is a corporation duly organized, validly existing and in good standing
    under the laws of the jurisdiction of its incorporation. Each Vega-Atlantic
    Subsidiary has all requisite corporate power and corporate authority to own,
    lease and operate its properties and assets and to carry on its business as
    now being conducted. No actions or proceedings to dissolve any Vega-Atlantic
    Subsidiary are pending.
  All of the outstanding capital stock of each Vega-Atlantic Subsidiary is
    owned directly or indirectly by Vega-Atlantic free and clear of all Encumbrances.
    All outstanding shares of capital stock of each Vega-Atlantic Subsidiary have
    been validly issued and are fully paid and non-assessable. No shares of capital
    stock of any Vega-Atlantic Subsidiary are subject to, nor have any been issued
    in violation of, pre-emptive or similar rights.**3.9 Financial statements.** Vega-Atlantic has delivered to Transax
  accurate and complete copies of Vega-Atlantic’s audited balance sheet
  as of March 31, 2003 (the “*Vega-Atlantic Balance Sheet Date*”),
  and the related audited statements of income, stockholders’ equity and
  cash flows for the year then ended, and the notes and schedules thereto, together
  with the unqualified reports thereon of Vega-Atlantic’s auditors (collectively,
  the “*Vega-Atlantic Financial Statements*”). The Vega-Atlantic
  Financial Statements: (i) represent actual bona fide transactions; (ii) have
  been prepared from the books and records of Vega-Atlantic and its Subsidiaries
  in conformity with US GAAP applied on a basis consistent with preceding years
  throughout the periods involved; and (iii) accurately, completely and fairly
  present in all material respects the financial position of Vega-Atlantic and
  its Subsidiaries as of the respective dates thereof and their results of operations
  and cash flows for the periods then ended. All financial projections, forecasts
  and other forward-looking information provided by Vega-Atlantic to Transax were,
  as of their respective dates, prepared in good faith and on a basis that management
  of Vega-Atlantic believed to be reasonable.
**3.10 SEC Filings.** Vega-Atlantic has filed with the United
  States Securities and Exchange Commission all forms, reports, schedules, statements
  and other documents required to be filed by it during the past two years from
  the date hereof under the Securities Act, the Exchange Act and all other federal
  securities laws. All forms, reports, schedules, statements and other documents
  (including all amendments thereto) filed by Vega-Atlantic with the Securities
  and Exchange Commission since such date are herein collectively referred to
  as the “SEC Filings”. Set forth on Schedule 3.11 is a list
  of all the SEC Filings filed by Vega-Atlantic with the Securities and Exchange
  Commission. Vega-Atlantic has delivered to Transax accurate and complete copies
  of all the SEC Filings listed on Schedule 3.10 that were filed as a paper
  submission. The SEC Filings, at the time filed, complied in all material respects
  with all applicable requirements of federal securities laws. To the knowledge
  of Vega-Atlantic, none of the SEC Filings, including, without limitation, any
  financial statements or schedules included therein, at the time filed, contained
  any untrue statement of a material fact or omitted to state any material fact
  required to be stated therein or necessary in order to make the statements contained
  therein, in light of the circumstances under which they were made, not misleading.
  Except as disclosed on Schedule 3.10, all SEC Filings were filed timely
  with the Securities and Exchange Commission.
**3.11 Disclosure documents**. None of the information relating
  to Vega-Atlantic, this Agreement or the transactions contemplated in this Agreement
  that has been or is to be supplied by Vega-Atlantic for inclusion in, or has
  been or is to be incorporated by reference from, Securities and Exchange Commission
  filings of Vega-Atlantic in any documents to be filed with any regulatory authority
  by Vega-Atlantic in connection with the transactions contemplated by this Agreement,
  at the respective time such document is filed or becomes effective, or at the
  Effective Time, as the case may be, will be false or misleading with respect
  to any material fact, or will omit to state any material fact necessary in order
  to make the statements therein not misleading. All documents required to be
  filed by Vega-Atlantic in connection with the Merger will comply as to form
  in all material respects with the applicable requirements of the statutes, rules
  and regulations pursuant to which they are filed. No representations are made
  in this Section by Vega-Atlantic or Newco with respect to any information included
  or incorporated by reference in any information to be filed with any regulatory
  authority by Vega-Atlantic in connection with the transactions contemplated
  by this Agreement.
**3.12 Absence of undisclosed liabilities.**Neither Vega-Atlantic,
  Newco nor any other Subsidiary of Vega-Atlantic has any liability or obligation
  (whether accrued, absolute, contingent, unliquidated or otherwise, whether or
  not known to Vega-Atlantic, and whether due or to become due), except: (i) liabilities
  reflected on the Vega-Atlantic Balance Sheet; (ii) liabilities described in
  the notes accompanying the Vega-Atlantic Financial Statements; (iii) liabilities
  that have arisen since the date of the Vega-Atlantic Balance Sheet in the ordinary
  course of business (none of which is a material liability for breach of contract,
  breach of warranty, tort or infringement); (iv) liabilities arising under executory
  contracts entered into in the ordinary course of business (none of which is
  a material liability for breach of contract); (v) liabilities specifically set
  forth on Schedule 3.12; and (vi) other liabilities which, in the aggregate,
  are not material to Vega-Atlantic.
**3.13 Absence of certain changes.** Except as disclosed on Schedule
  3.13, since the Vega-Atlantic Balance Sheet Date: (i) there has not been any
  change, development or event, individually or in the aggregate, that has had,
  or might reasonably be expected to have, a Material Adverse Effect; (ii) the
  business of Vega-Atlantic and its Subsidiaries has been conducted only in the
  ordinary course consistent with past practice; (iii) neither Vega-Atlantic nor
  its Subsidiaries has incurred any material liability, engaged in any material
  transaction or entered into any material agreement outside the ordinary course
  of business consistent with past practice; (iv) neither Vega-Atlantic nor its
  Subsidiaries has suffered any material loss, damage, destruction or other casualty
  to any of its assets (whether or not covered by insurance); and (v) Vega-Atlantic
  has not taken any of the actions set forth in Section 4.2 except as permitted
  thereunder.
**3.14 Tax matters.** Except as disclosed on Schedule 3.14:
Vega-Atlantic has (and as of the Effective Time will have) duly filed all
    federal, state, local and foreign Tax Returns required to be filed by or with
    respect to it with the IRS or other applicable taxing authority, and no extensions
    with respect to such Tax Returns have (or as of the Effective Time will have)
    been requested or granted;
  Vega-Atlantic has (and as of the Effective Time will have) paid, or adequately
    reserved against in the Vega-Atlantic Financial Statements, all Taxes due,
    or claimed by any taxing authority to be due, from or with respect to it,
    except Taxes that are being contested in good faith by appropriate legal proceedings
    and for which adequate reserves have been set aside as disclosed on Schedule
    3.14;
  there has been no issue raised or adjustment proposed (and none is pending)
    by the IRS or any other taxing authority in connection with any of the Tax
    Returns;
  Vega-Atlantic has (and as of the Effective Time will have) made all deposits
    required with respect to Taxes;
  the federal income Tax Returns of Vega-Atlantic have been audited by the
    IRS or other applicable taxing authority, through the taxable year ended March
    31, 2003, and the audit proceedings have been closed and all adjustments settled
    through the taxable year ended March 31, 2003;
  no waiver or extension of any statute of limitations as to any federal,
    state, local or foreign Tax matter has been given by or requested from Vega-Atlantic;
    and
  Vega-Atlantic has not filed a consent under Section 341(f) of the Code.
**3.15 Compliance with laws**. Except as disclosed on Schedule
  3.15, each of Vega-Atlantic and its Subsidiaries has complied in all material
  respects with all Applicable Laws, except for non-compliance with such Applicable
  Laws which, individually or in the aggregate, does not and will not have a Material
  Adverse Effect. Neither Vega-Atlantic nor any of its Subsidiaries has received
  any written notice, which has not been dismissed or otherwise disposed of, that
  such person has not so complied. Neither Vega-Atlantic nor any of its Subsidiaries
  is charged or, to the knowledge of Vega-Atlantic, threatened with, or, to the
  knowledge of Vega-Atlantic, under investigation with respect to, any violation
  of any Applicable Laws relating to any aspect of the business of Vega-Atlantic
  or any of its Subsidiaries, other than violations which, individually or in
  the aggregate, do not and will not have a Material Adverse Effect.
**3.16 Legal Proceedings.** There are no Proceedings pending or,
  to the knowledge of Vega-Atlantic, threatened against or involving Vega-Atlantic
  or any of its Subsidiaries (or any of its directors or officers in connection
  with the business or affairs of Vega-Atlantic or any of its Subsidiaries) or
  any properties or rights of Vega-Atlantic which, individually or in the aggregate,
  might reasonably be expected to have a Material Adverse Effect. There are no
  Proceedings pending or, to the knowledge of Vega-Atlantic, threatened, seeking
  to restrain, prohibit or obtain damages or other relief in connection with this
  Agreement or the transactions contemplated hereby.
**3.17 Title to assets.** Each of Vega-Atlantic and its Subsidiaries
  has good and defensible title, and in the case of real property insurable title,
  to all properties and assets (real, personal and mixed, tangible and intangible)
  it owns or purports to own and including, without limitation, the properties
  and assets reflected in its books and records and in the Vega-Atlantic Balance
  Sheet, other than those disposed of after the date of such Vega-Atlantic Balance
  Sheet in the ordinary course of business consistent with past practice, free
  and clear of all Encumbrances, except as disclosed on Schedule 3.17, and such
  imperfections or irregularities of title, if any, as: (i) are not substantial
  in character, amount or extent and do not materially detract from the value
  of the property or asset subject thereto; (ii) do not materially interfere with
  either the present or intended use of such property; and (iii) do not, individually
  or in the aggregate, materially interfere with the conduct of Vega-Atlantic’s
  normal operations.
**3.18 Permits.** Vega-Atlantic and its Subsidiaries hold all
  Permits necessary or required for the conduct of the business of Vega-Atlantic
  as currently conducted. Each of such Permits is in full force and effect, Vega-Atlantic
  and its Subsidiaries are in compliance with all its obligations with respect
  thereto, and, to the knowledge of Vega-Atlantic, no event has occurred which
  permits, or with or without the giving of notice or the passage of time or both
  would permit, the revocation or termination of any thereof. Except as disclosed
  on Schedule 3.18, no notice has been issued by any Governmental Entity and no
  Proceeding is pending or, to the knowledge of Vega-Atlantic, threatened with
  respect to any alleged failure by Vega-Atlantic or any of its Subsidiaries to
  have any Permit.
**3.19 Agreements.**
Set forth on Schedule 3.19 is a list of all the following agreements, arrangements
    and understandings (written or oral, formal or informal) (collectively, for
    purposes of this Section, “agreements”) to which Vega-Atlantic
    or any of its Subsidiaries is a party or by which Vega-Atlantic, any of its
    Subsidiaries or any of their respective properties or assets is otherwise
    bound: collective bargaining agreements and similar agreements with employees
        as a group;
      employee benefit agreements, trusts, plans, funds, or other arrangements
        of any nature, including those referred to in Section 4.3(e);
      agreements with any current or former shareholder, director, officer,
        employee, consultant or advisor or any affiliate of any such person;
      agreements between or among Vega-Atlantic and any of the Subsidiaries;
      indentures, mortgages, security agreements, notes, loan or credit agreements
        or other agreements relating to the borrowing of money by Vega-Atlantic
        or any Subsidiary or to the direct or indirect guarantee or assumption
        by Vega-Atlantic or any Subsidiary of any obligation of others, including
        any agreement that has the economic effect although not the legal form
        of any of the foregoing;
      agreements relating to the acquisition or disposition of assets, other
        than those entered into in the ordinary course of business consistent
        with past practice;
      agreements relating to the acquisition or disposition of any interest
        in any business enterprise;
      agreements with respect to the lease of real or personal property;
      agreements concerning the management or operation of any real property;
      broker, distributor, dealer, manufacturer's representative, sales,
        agency, sales promotion, advertising, market research, marketing, consulting,
        research and development, maintenance, service and repair agreements;
      license, royalty or other agreements relating to Intellectual Property;
      partnership, joint venture and profit sharing agreements;
      agreements with any Governmental Entity;
      agreements relating to the release or disposal of hazardous material
        (as such term is defined in Section 3.21(b));
      agreements in the nature of a settlement or a conciliation agreement
        arising out of any claim asserted by any other person;
      agreements containing any covenant limiting the freedom of Vega-Atlantic
        or any Subsidiary to engage in any line of business or compete with any
        other person in any geographic area or during any period of time;
      powers of attorney granted by Vega-Atlantic or any Subsidiary in favor
        of any person;
      agreements not made in the ordinary course of business; and
      other agreements, whether or not made in the ordinary course of business,
        that are material to the business, assets, results of operations, condition
        (financial or otherwise) or prospects of Vega-Atlantic. For the purposes
        of this Section 3.20, a “material” agreement shall mean any
        agreement that provides for aggregate payments or receipts in excess of
        $25,000.00 during the course of a calendar year.
  Vega-Atlantic has made available to Transax accurate and complete copies
    of the agreements listed on Schedule 3.19 and will provide physical copies
    of each such agreement not later than five business days prior to the Effective
    Time. Each of such agreements is a valid and binding agreement of the parties
    thereto enforceable against them in accordance with its terms. No breach or
    default exists with respect to any of such agreements, and no event has occurred
    which, after the giving of notice or the passage of time or otherwise, will
    result in any such breach or default.
  Neither Vega-Atlantic nor any of its Subsidiaries has received notice of
    any plan or intention of any other party to any agreement to exercise any
    right of offset with respect to, or any right to cancel or terminate, any
    agreement, and Vega-Atlantic does not know of any fact or circumstance that
    would justify the exercise by any such other party of such a right other than
    the automatic termination of such agreement in accordance with its terms.
    Vega-Atlantic does not currently contemplate, or have reason to believe any
    other person currently contemplates, any amendment or change to any agreement,
    which amendment or change could have a Material Adverse Effect.3.20 Employee Benefit Plans.
Set forth on Schedule 3.20(a) is a list of each employment, severance or
    other similar contract, arrangement or policy and each plan or arrangement
    (written or oral) providing for insurance coverage (including any self-insured
    arrangements), workers’ compensation, disability benefits, supplemental
    unemployment benefits, vacation benefits, retirement benefits, deferred compensation,
    profit-sharing, bonuses, stock options, stock appreciation rights or other
    forms of incentive compensation or post-retirement insurance, compensation
    or benefits which: (i) is entered into, maintained or contributed to, as the
    case may be, by Vega-Atlantic or any affiliate of Vega-Atlantic: and (ii)
    covers any employee or former employee of Vega-Atlantic or any affiliate of
    Vega-Atlantic or under which Vega-Atlantic or any affiliate of Vega-Atlantic
    has any liability. Such contracts, plans and arrangements as are described
    in the preceding sentence are referred to for purposes of this Section as
    the “Benefit Plans”. Each Benefit Plan has been maintained in
    substantial compliance with its terms and with the requirements prescribed
    by Applicable Laws.
  Set forth on Schedule 3.20(b) are all liabilities and obligations (whether
    accrued, absolute, unliquidated or otherwise) of Vega-Atlantic and its Subsidiaries
    relating to any Benefit Plan of Vega-Atlantic or its Subsidiaries, including
    but not limited to, employee retirement, severance or similar post-employment
    arrangements.
  Except as disclosed on Schedule 3.20(c), none of the employees of Vega-Atlantic
    or any of its Subsidiaries may cause Vega-Atlantic or any of its Subsidiaries
    to maintain their respective Benefit Plans in compliance with the requirements
    prescribed by ERISA or any other applicable United States federal or state
    laws relating to employee benefits.
  Except as disclosed on Schedule 3.20(d), there has been no amendment, written
    interpretation or announcement (whether or not written) by Vega-Atlantic or
    any affiliate of Vega-Atlantic of or relating to, or change in employee participation
    or coverage under, any Benefit Plan that would increase materially the expense
    of maintaining such Benefit Plan above the level of the expense incurred in
    respect thereof for the fiscal year ended March 31, 2003.**3.21 Environmental matters.**
Except as disclosed in Schedule 3.21(a) and except for matters that in the
    aggregate would not have a Material Adverse Effect:to the knowledge of Vega-Atlantic, the properties, operations and activities
        of Vega-Atlantic and its Subsidiaries comply with all Applicable Environmental
        Laws (as defined below);
      Vega-Atlantic, its Subsidiaries and the properties, operations and
        activities of Vega-Atlantic and its Subsidiaries are not subject to any
        existing, pending or, to the knowledge of Vega-Atlantic, threatened Proceeding
        under, or to any remedial obligations under, any Applicable Environmental
        Laws;
      all Permits, if any, required to be obtained by Vega-Atlantic or any
        of its Subsidiaries under any Applicable Environmental Laws in connection
        with any aspect of the business of Vega-Atlantic or its Subsidiaries,
        including without limitation those relating to the treatment, storage,
        disposal or release of a hazardous material (as defined below), have been
        duly obtained and are in full force and effect, and Vega-Atlantic and
        each of its Subsidiaries is in compliance with the terms and conditions
        of all such Permits;
      Each of Vega-Atlantic and its Subsidiaries has satisfied and is currently
        in compliance with all financial responsibility requirements applicable
        to its operations and imposed by any Governmental Entity under any Applicable
        Environmental Laws, and neither Vega-Atlantic nor any of its Subsidiaries
        has received any notice of non-compliance with any such financial responsibility
        requirements;
      to the knowledge of Vega-Atlantic, there are no physical or environmental
        conditions existing on any property owned or leased by Vega-Atlantic or
        any of its Subsidiaries, or resulting from their respective operations
        or activities, past or present, at any location, that would give rise
        to any on-site or off-site remedial obligations under any Applicable Environmental
        Laws;
      to the knowledge of Vega-Atlantic, since the Effective Time of the
        relative requirements of Applicable Environmental Laws, all hazardous
        materials generated by Vega-Atlantic or any of its Subsidiaries, or used
        in connection with its properties, operations or activities, have been
        transported only by carriers authorized under Applicable Environmental
        Laws to transport such materials, and have been disposed of only at treatment,
        storage and disposal facilities authorized under Applicable Environmental
        Laws to treat, store or dispose of such materials and, to the knowledge
        of Vega-Atlantic, such carriers and facilities have been and are operating
        in compliance with such authorizations and are not the subject of any
        existing, pending or threatened Proceeding in connection with any Applicable
        Environmental Laws;
      there has been no exposure of any person or property to hazardous materials,
        nor has there been any release of hazardous materials into the environment,
        by Vega-Atlantic, its Subsidiaries or in connection with their properties,
        operations or activities that could reasonably be expected to give rise
        to any claim for damages or compensation; and
      Vega-Atlantic shall make available to Transax all internal and external
        environmental audits and studies and all correspondence on substantial
        environmental matters in the possession of Vega-Atlantic relating to any
        of the current or former properties, operations or activities of Vega-Atlantic
        and its Subsidiaries; provided that Vega-Atlantic shall not be required
        to make available any such audits, studies or correspondence that may
        be subject to the attorney-client privilege or similar privilege.
  For purposes of this Section, “Applicable Environmental Laws”
    means any and all Applicable Laws pertaining to health, safety or the environment
    in effect in any and all jurisdictions in which Vega-Atlantic or any of its
    Subsidiaries has conducted operations or activities or owned or leased property
    and assets and including, without limitation, the Clear Air Act, as amended,
    the Comprehensive Environmental Response, Compensation and Liability Act of
    1980, as amended, the Rivers and Harbors Act of 1899, as amended, the Federal
    Water Pollution Control Act, as amended, the Occupational Safety and Health
    Act of 1970, as amended, the Resource Conservation and Recovery Act of 1976,
    as amended, the Safe Drinking Water Act, as amended, the Toxic Substances
    Control Act, as amended, the Superfund Amendments and Reauthorization Act
    of 1986, as amended, the Hazardous Materials Transportation Act, as amended,
    and other environmental conservation or protection laws. For purposes of this
    Agreement, the term “hazardous material” means: (i) any substance
    which is listed or defined as a hazardous substance, hazardous constituent
    or solid waste pursuant to any Applicable Environmental Laws; and (ii) petroleum
    (including crude oil and any fraction thereof), natural gas and natural gas
    liquids.
  The representations and warranties contained in this Section would continue
    to be true and correct following disclosure to the applicable Governmental
    Entities of all relevant facts, conditions and circumstances, if any, pertaining
    to the properties, operations and activities of Vega-Atlantic and its Subsidiaries.
**3.22 Labor relations.**
Except as disclosed on Schedule 3.22: (i) there are no collective bargaining
    agreements or other labor union contracts applicable to any employees to or
    by which Vega-Atlantic is a party or is bound, and no such agreement or contract
    has been requested by an employee or group of employees of Vega-Atlantic;
    (ii) no employees of Vega-Atlantic are represented by any labor organization,
    collective bargaining representative or group of employees; (iii) Vega-Atlantic
    is not obligated to bargain collectively with respect to wages, hours and
    other terms and conditions of employment with any recognized or certified
    labor organization, collective bargaining representative or group of employees;
    and (iv) Vega-Atlantic is not aware of any strikes, work stoppages, work slowdowns
    or lockouts or any threats thereof by or with respect to any of its employees
    and, since March 31, 2003, there have been no labor disputes, strikes, work
    stoppages, work slowdowns, lockouts or similar matters involving any such
    employees.
  Vega-Atlantic is in compliance in all material respects with all Applicable
    Laws pertaining to employment and employment practices and wages, hours and
    other terms and conditions of employment in respect of its employees and has
    no accrued liability for any arrears of wages or any Taxes or penalties for
    failure to comply with any thereof. Vega-Atlantic is not engaged in any unfair
    labor practices or unlawful employment practices. There is no pending or,
    to the knowledge of Vega-Atlantic, threatened Proceeding against or involving
    Vega-Atlantic by or before, and Vega-Atlantic is not subject to any judgment,
    order, writ, injunction or decree of or inquiry from, any Governmental Entity
    in connection with any current, former or prospective employee of Vega-Atlantic.
  Vega-Atlantic believes that relations with the employees of Vega-Atlantic
    are satisfactory.
**3.23 Employees.** Except as disclosed on Schedule 3.23,
  no severance payment, stay-on or incentive payment or similar obligation will
  be owed by Vega-Atlantic to any of its directors, officers or employees upon
  consummation of, or as a result of, the Merger or the transactions contemplated
  by this Agreement, nor will any such director, officer or employee be entitled
  to severance payments or other benefits as a result of the Merger or the transactions
  contemplated by this Agreement in the event of the subsequent termination of
  his or her employment.
**3.24 Insurance.** Set forth on Schedule 3.24 is a list
  and summary description, including risks covered, premium amounts and term of
  policy, of all policies of fire, liability, casualty, life and other insurance
  owned or held by each of Vega-Atlantic and its Subsidiaries. Such policies are
  in full force and effect, are sufficient to satisfy all material requirements
  of Applicable Laws and any agreements, arrangements or understandings to which
  Vega-Atlantic or any of its Subsidiaries is a party and provide adequate insurance
  coverage for the assets and operations of Vega-Atlantic and its Subsidiaries.
  All premiums due and payable with respect to such policies have been timely
  paid. No notice of cancellation of, or indication of an intention not to renew,
  any such policy has been received by Vega-Atlantic or any of its Subsidiaries.
  No event has occurred nor does any fact or condition exist which would render
  any of such policies void or voidable or subject any of such policies to cancellation
  or termination. Each of Vega-Atlantic and its Subsidiaries has given timely
  notice to the appropriate insurance carrier of all pending or threatened claims
  against it that are insured. Schedule 3.24 also lists all pending and
  threatened insured claims. To the knowledge of Vega-Atlantic, the insurance
  companies providing the insurance listed on Schedule 3.24 are solvent.
  During the past three years no application by Vega-Atlantic or any of its Subsidiaries
  for insurance with respect to its assets or operations has been denied for any
  reason. To the knowledge of Vega-Atlantic, adequate insurance coverage for the
  assets and operations of Vega-Atlantic and its Subsidiaries is provided for.
**3.25 Books and records**. All the books and records of Vega-Atlantic
  and each of its Subsidiaries, including all personnel files, employee data and
  other materials relating to employees, are substantially complete and correct
  in all material respects, have been in all material respects maintained in accordance
  with good business practice and all Applicable Laws and, in the case of the
  books of account, have been in all material respects prepared and maintained
  in accordance with generally accepted accounting principles consistently applied.
  Such books and records accurately and fairly reflect, in reasonable detail,
  all material transactions, revenues, expenses, assets and liabilities of Vega-Atlantic
  and each of its Subsidiaries.
**3.26 Illegal payments.** To the knowledge of Vega-Atlantic,
  none of Vega-Atlantic, any of its Subsidiaries or any director, officer, employee
  or agent of such person has, directly or indirectly, paid or delivered any fee,
  commission or other sum of money or item of property however characterized to
  any broker, finder, agent, government official or other person, in the United
  States or any other country, in any manner related to the business or operations
  of Vega-Atlantic or any of its Subsidiaries, which Vega-Atlantic or any such
  director, officer, employee or agent knows, or has reason to believe, to have
  been illegal under any Applicable Laws.
**3.27 Offerings of securities.** All securities that have been
  offered or sold by Vega-Atlantic or any of its Subsidiaries have been registered
  pursuant to the Securities Act and applicable foreign or state securities laws
  or were offered and sold pursuant to valid exemptions therefrom. No registration
  statement, prospectus, private offering memorandum or other information furnished
  (whether in writing or orally) to any offeree or purchaser of such securities,
  at the time such registration statement became effective (in the case of a registered
  offering) or at the time of delivery of such registration statement, prospectus,
  private offering memorandum or other information, contained any untrue statement
  of a material fact or omitted to state any material fact required to be stated
  therein or necessary in order to make the statements contained therein, in light
  of the circumstances under which they were made, not misleading. To the extent
  that any such securities were registered under the Securities Act or foreign
  securities exchange, the applicable registration statements and prospectuses
  filed with the Securities and Exchange Commission or such foreign securities
  exchange, at the time each such registration statement became effective, and
  at all times when delivery of a prospectus was required pursuant to the Securities
  Act or such foreign securities laws, complied in all material respects with
  the requirements of such applicable securities laws and the rules and regulations
  thereunder.
**3.28 Brokerage fees.** Except as disclosed on Schedule 3.28,
  Neither Vega-Atlantic nor any of its affiliates has retained any financial advisor,
  broker, agent or finder, or paid or agreed to pay any financial advisor, broker,
  agent or finder, on account of this Agreement or any transaction contemplated
  hereby. Vega-Atlantic shall indemnify and hold harmless Transax from and against
  any and all losses, claims, damages and liabilities (including legal and other
  expenses reasonably incurred in connection with investigating or defending any
  claims or actions) with respect to any finder’s fee, brokerage commission
  or similar payment in connection with any transaction contemplated hereby asserted
  by any person on the basis of any act or statement made or alleged to have been
  made by Vega-Atlantic or any of its affiliates.
**3.29 Other covenants.** In order to further induce each of Transax
  and the Selling Shareholders to enter in this Agreement and consummate the proposed
  Merger, Vega-Atlantic hereby also represents, warrants and covenants with each
  of Transax and the Selling Shareholders that:
Vega-Atlantic’s present accounts payable, which are estimated
    at approximately U.S. $45,274.25 as at June 12, 2003, will not, except for
    any costs incurred by Vega-Atlantic in completing the within Merger, increase
    by more than ten percent (10%) by the Closing, and Vega-Atlantic may make
    payments to decrease the accounts payable before the Closing.
  Vega-Atlantic has been provided with certain advances by parties associated
    with Vega-Atlantic, approximating U.S. $540,290.16 as at June 12, 2003, to
    which Vega-Atlantic has agreed to repay those advances and accrued interest
    by way of the issuance of certain common shares of Vega-Atlantic immediately
    prior to or subsequent to the Closing; and except for certain further advances
    by parties associated with Vega-Atlantic for costs incurred by Vega-Atlantic
    in the normal course of business and in completing the within Merger, there
    will not be any further advances outstanding at the Closing.
  Vega-Atlantic will use its commercially reasonable efforts prior to
    and/or commensurate with Closing to arrange an advance by way of loan (each
    being a “Funding”) or raise an initial common share private placement
    funding (each being a “Private Placement”) for Vega-Atlantic,
    under “Rule 506” or Regulation S under the Securities Act, of
    a minimum of $500,000.00 and a maximum of up to $1,000,000.00, and at a Private
    Placement subscription price of not less than $1.00 per restricted common
    share, with an understanding to utilize its commercially reasonable efforts
    to raise not less than $250,000.00 of the Funding and/or Private Placement
    within 60 calendar days from the acceptance date of the Agreement In Principle
    by Transax and Vega-Atlantic and with a further understanding to utilize its
    commercially reasonable efforts to raise not less than an initial $125,000.00
    of the Funding and/or Private Placement within 30 calendar days from the acceptance
    date of the Agreement In Principle by Transax and Vega-Atlantic.
  Vega-Atlantic will file, with the prior written consent of Transax,
    a “Form S-8” registration statement for a stock option plan in
    the estimated amount of up to 4,500,000 common shares of Vega-Atlantic, at
    an exercise price of not less than $0.50 per common share (collectively, the
    “Options”); and in such amounts and with such optionees as may
    be determined by management for Vega-Atlantic and Transax, acting reasonably,
    prior to the Closing; it being acknowledged and agreed that, at present, all
    such Options will be exchanged as Vega-Atlantic Options for Transax’s
    Options, on the same exercise and pricing terms and conditions and for that
    number of shares of Vega-Atlantic Common Stock equal to the product of the
    number of shares of Transax Common Stock covered by the Transax Option immediately
    prior to the Effective Time multiplied by the Common Stock Exchange Ratio
    rounded up to the nearest whole number of shares of Vega-Atlantic Common Stock
    in and to the resulting company, in consideration, in part, of the ongoing
    involvement of the existing Transax Optionholders in and to the resulting
    company and in exchange for the agreed upon cancellation by said Transax Optionholders
    of all of the then issued and outstanding Transax Options as a consequence
    thereof; and it being further acknowledged and agreed that, subject to applicable
    securities laws, any common shares of Vega-Atlantic Common Stock which may
    arise from the exercise of any such Options subsequent to the Closing will
    be held in pool and either: (i) sold jointly and pro rata with any other Option
    common shares deposited therein; or (ii) restricted as to sale in such maximum
    daily amounts as may be determined in accordance with the sole and absolute
    discretion and direction of such nominee or nominees as may be mutually agreed
    upon in writing, from time to time, by each of Vega-Atlantic and Transax at
    or subsequent to the Closing.
  Vega-Atlantic will exchange all existing 8,200,000 Transax Warrants,
    on the same exercise and pricing terms and conditions and for that number
    of shares of Vega-Atlantic Common Stock equal to the product of the number
    of shares of Transax Common Stock covered by the Transax Warrant immediately
    prior to the Effective Time multiplied by the Common Stock Exchange Ratio
    rounded up to the nearest whole number of shares of Vega-Atlantic Common Stock
    in and to the resulting company, in consideration, in part, of the ongoing
    involvement of the existing Transax Warrantholders in and to the resulting
    company and in exchange for the agreed upon cancellation by said Transax Warrantholders
    of all of the then issued and outstanding Transax Warrants as a consequence
    thereof.
  Vega-Atlantic will use its commercially reasonable efforts prior to
    and/or commensurate with the Closing to enter into a proposed “Consulting
    Services Agreement” with Investor Communications International, Inc.
    (the “Consulting Agreement”); a copy of the form of which proposed
    Consulting Agreement being attached hereto as Exhibit F.
  Vega-Atlantic will have acquired the necessary approval of its shareholders,
    if required, to change the name of Vega-Atlantic to “Transax Corp.”,
    or to such other name as the Transax Board of Directors may determine at Closing,
    together with the appointment of the existing directors of Transax to the
    resulting Board of Directors of Vega-Atlantic and the appointment of up to
    three nominees of Transax as Executive Officers of Vega-Atlantic at Closing;
    such appointees or nominees to be determined prior to Closing, and in Transax’s
    sole and absolute discretion; and at or prior to Closing, as the case may
    require, Vega-Atlantic shall be in the process of preparing, filing and delivering
    the necessary documentation to its shareholders and all applicable regulatory
    authorities in order to effect the same and which shall include, without limitation,
    obtaining a new trading symbol and CUSIP number for the resulting company
    and filing a “Form 14F” for the resulting company with the applicable
    regulatory authorities and in compliance with Applicable Laws in order to
    effect the resulting change in the Board of Directors of Vega-Atlantic at
    Closing.**3.30 Disclosure.** No representation or warranty made by Vega-Atlantic
  in this Agreement, and no statement of Vega-Atlantic contained in any document,
  certificate or other writing furnished or to be furnished by Vega-Atlantic pursuant
  hereto or in connection herewith, contains or will contain, at the time of delivery,
  any untrue statement of a material fact or omits or will omit, at the time of
  delivery, to state any material fact necessary in order to make the statements
  contained therein, in light of the circumstances under which they are made,
  not misleading. Vega-Atlantic knows of no matter that has not been disclosed
  to Transax pursuant to this Agreement that has or, so far as Vega-Atlantic can
  now reasonably foresee, will have a Material Adverse Effect. Vega-Atlantic has
  made available to Transax accurate and complete copies of all agreements, documents
  and other writings referred to or listed in this Article III or any Schedule
  hereto.
**3.31 Representations and warranties as of the Effective Time**.
  The representations and warranties made in this Article III will be true and
  correct on and as of the Effective Time with the same force and effect as if
  such representations and warranties had been made on and as of the Effective
  Time, except that any such representations and warranties which expressly relate
  only to an earlier date shall be true and correct on the Effective Time as of
  such earlier date.
**3.32 No other representations.** Except as and to the extent
  expressly set forth in this Article III, Vega-Atlantic makes no representations
  or warranties whatsoever to Transax and hereby disclaims all liability and responsibility
  for any representation, warranty, statement or information made, communicated
  or furnished (orally or in writing) to Transax or their representatives (including
  without limitation any opinion, information, projection or advice that may have
  been or may be provided to Transax by any director, officer, employee, agent,
  consultant or representative of Vega-Atlantic or any affiliate thereof).

**Article IV
  CONDUCT OF COMPANIES PENDING MERGER**
Transax and Vega-Atlantic each hereby covenants and agrees as follows:
**4.1 Conduct and preservation of business.** Except as expressly
  provided in this Agreement, during the period from the date hereof to the Effective
  Time each of Transax, Vega-Atlantic and their Subsidiaries: (i) shall conduct
  its operations according to its ordinary course of business consistent with
  past practice and in compliance with all Applicable Laws; (ii) shall each use
  its reasonable best efforts to preserve, maintain and protect its properties
  and assets; and (iii) shall each use its reasonable best efforts to preserve
  intact its business organization, to keep available the services of its officers
  and employees and to maintain existing relationships with licensors, licensees,
  suppliers, contractors, distributors, customers and others having business relationships
  with it.
**4.2 Financial status and reports.** Vega-Atlantic promptly shall
  deliver to Transax copies of all additional SEC Filings filed by Vega-Atlantic
  with the Securities and Exchange Commission between the date hereof and the
  Effective Time. Each party hereto promptly shall deliver to the other party
  or parties copies of all unaudited financial statements prepared for distribution
  or dissemination to executive management of such company.
**4.3 Restrictions on certain actions.** Without limiting the
  generality of the foregoing, and except as otherwise expressly provided in this
  Agreement and the transactions contemplated herein, prior to the Effective Time
  neither Transax, on the one hand, nor Vega-Atlantic or Newco, on the other,
  shall or cause any of their respective Subsidiaries to, without the prior written
  consent of the other party or parties:
amend its Charter or Bylaws;
  (i) issue, sell or deliver (whether through the issuance or granting
    of options, warrants, commitments, subscriptions, rights to purchase or otherwise)
    any shares of its capital stock of any class or any other securities or equity
    equivalents; (ii) issue or grant any warrants, commitments, subscriptions,
    rights to purchase or any other derivative securities; or (iii) amend in any
    material respect any of the terms of any such securities outstanding as of
    the date hereof;
  (i) split, combine or reclassify any shares of its capital stock; (ii)
    declare, set aside or pay any dividend or other distribution (whether in cash,
    stock or property or any combination thereof) in respect of its capital stock;
    (iii) repurchase, redeem or otherwise acquire any of its securities; or (iv)
    adopt a plan of complete or partial liquidation or resolutions providing for
    or authorizing a liquidation, dissolution, merger, consolidation, restructuring,
    recapitalization or other reorganization of itself;
  (i) except in the ordinary course of business consistent with past practice,
    create, incur, guarantee or assume any indebtedness for borrowed money or
    otherwise become liable or responsible for the obligations of any other person;
    (ii) make any loans, advances or capital contributions to, or investments
    in, any other person (other than to wholly-owned subsidiaries and customary
    loans or advances to employees in amounts not material to the maker of such
    loan or advance); (iii) pledge or otherwise encumber shares of its capital
    stock; or (iv) except in the ordinary course of business consistent with past
    practice, mortgage or pledge any of its material assets, tangible or intangible,
    or create or suffer to exist any lien thereupon;
  (i) enter into, adopt or (except as may be required by law) amend or
    terminate any bonus, profit sharing, compensation, severance, termination,
    stock option, stock appreciation right, restricted stock, performance unit,
    stock equivalent, stock purchase, pension, retirement, deferred compensation,
    employment, severance or other employee benefit agreement, trust, plan, fund
    or other arrangement for the benefit or welfare of any director, officer or
    employee; (ii) except for normal increases in the ordinary course of business
    consistent with past practice that, in the aggregate, do not result in a material
    increase in benefits or compensation expense to it, increase in any manner
    the compensation or fringe benefits of any director, officer or employee;
    or (iii) pay to any director, officer or employee any benefit not required
    by any employee benefit agreement, trust, plan, fund or other arrangement
    as in effect on the date hereof;
  acquire, sell, lease, transfer or otherwise dispose of, directly or
    indirectly, any assets outside the ordinary course of business consistent
    with past practice or any assets that in the aggregate are material to it;
  acquire (by merger, consolidation or acquisition of stock or assets
    or otherwise) any corporation, partnership or other business organization
    or division thereof;
  make any capital expenditure or expenditures which, individually, is
    in excess of $25,000.00 or, in the aggregate, are in excess of $75,000.00;
  amend any Tax Return or make any tax election or settle or compromise
    any federal, state, local or foreign tax liability material to it;
  pay, discharge or satisfy any claims, liabilities or obligations (whether
    accrued, absolute, contingent, unliquidated or otherwise, and whether asserted
    or unasserted), other than the payment, discharge or satisfaction in the ordinary
    course of business consistent with past practice, or in accordance with their
    terms, of liabilities reflected or reserved against in the financial statements
    in the ordinary course of business consistent with past practice;
  enter into any lease, contract, agreement, commitment, arrangement or
    transaction outside the ordinary course of business consistent with past practice;
  amend, modify or change in any material respect any existing lease,
    contract or agreement, other than in the ordinary course of business consistent
    with past practice;
  waive, release, grant or transfer any rights of value, other than in
    the ordinary course of business consistent with past practice;
  hire or lay off any of its employees;
  change any of its banking or safe deposit arrangements;
  change any of the accounting principles or practices used by it;
  take any action which would or might make any of its representations
    or warranties contained in this Agreement untrue or inaccurate as of any time
    from the date of this Agreement to the Effective Time or would or might result
    in any of the conditions set forth in this Agreement not being satisfied;
    or
  authorize or propose, or agree in writing or otherwise, to take any
    of the actions described in this Section.**Article V
  ADDITIONAL AGREEMENTS**
**5.1 Access to information; confidentiality**. Subject to Applicable
  Laws, between the date hereof and the Effective Time each of the parties hereto:
  (i) shall give the other party or parties hereto and their respective authorized
  representatives reasonable access, during regular business hours, to all employees,
  all plants, offices, warehouses and other facilities, and all books and records,
  including work papers and other materials prepared by independent public accountants;
  (ii) shall permit such other party or parties hereto and their respective authorized
  representatives to make such inspections as they may reasonably require; and
  (iii) shall cause its officers to furnish the other party or parties hereto
  and their respective authorized representatives with such financial and operating
  data and other information with respect to it as such other party or parties
  hereto may from time to time reasonably request; provided, however, that no
  investigation pursuant to this Section shall affect any representation or warranty
  of any other party hereto contained in this Agreement or in any agreement, instrument
  or document delivered pursuant hereto or in connection herewith; and provided
  further that the party granting such access shall have the right to have a representative
  present at all times of any such inspections, interviews and examinations conducted
  at or on its offices or other facilities or properties. Vega-Atlantic and Transax
  shall hold in confidence all such information on the terms and subject to the
  conditions contained in that certain “*Agreement In Principle*”
  dated June 19, 2003, as entered into between Vega-Atlantic, Transax and certain
  shareholders of Transax (the “*Agreement In Principle*”).
**5.2 Appropriate action; consents; filings.**
Each of Transax and Newco shall take all action necessary in accordance
    with Applicable Laws of the State of Colorado and its Articles of Incorporation
    and Bylaws to duly call, give notice of, convene and hold a special meeting
    of its shareholders (the “Special Meeting”) as promptly as practicable
    after the date hereof to consider and vote upon the adoption and approval
    of this Agreement and the Merger. The shareholder vote required for the adoption
    and approval of this Agreement and the Merger shall be the vote required by
    Article 111 of the CBCA with respect to Transax, Newco and their respective
    Articles of Incorporation. The Board of Directors of each of Transax and Newco
    shall: (i) recommend to its shareholders that they vote in favor of the adoption
    and approval of this Agreement and the Merger; and (ii) take all other action
    reasonably necessary to secure a vote of its shareholders in favor of such
    adoption and approval.
  Transax, Vega-Atlantic and Newco each shall use its best efforts to:
    (i) take, or cause to be taken, all appropriate action, and do, or cause to
    be done, all things necessary, proper or advisable under Applicable Laws or
    otherwise to consummate and make effective the transactions contemplated in
    this Agreement; (ii) obtain from any Governmental Entities any consents, licenses,
    permits, waivers, approvals, authorizations or orders required to be obtained
    or made by Transax or Vega-Atlantic in connection with the consummation of
    the transactions contemplated herein, including, without limitation, the Merger;
    and (iii) make all necessary filings, and thereafter make any other required
    submissions, with respect to this Agreement and the Merger required under:
    (A) the Securities Act and the Exchange Act and the rules and regulations
    thereunder (in the case of Vega-Atlantic), and any other applicable federal
    or state securities laws; and (B) any other Applicable Laws. Transax, Vega-Atlantic
    and Newco shall furnish all information required for any application or other
    filing to be made pursuant to the rules and regulations of any Applicable
    Laws in connection with the transactions contemplated in this Agreement.**5.3 Tax treatment.** Each of Transax and Vega-Atlantic shall
  use its best efforts to cause the Merger to qualify, and will not take any actions
  which could prevent the Merger from qualifying, as a reorganization under the
  provisions of section 368(a) of the Code.
**5.4 Notice of litigation.** Until the Effective Time: (i) Vega-Atlantic,
  upon learning of the same, shall promptly notify Transax of any Proceeding which
  is commenced or threatened against Vega-Atlantic or Newco and which affects
  this Agreement or the transactions contemplated hereby; and (ii) Transax, upon
  learning of the same, shall promptly notify Vega-Atlantic of any Proceeding
  which is commenced or threatened against Transax and which affects this Agreement
  or the transactions contemplated hereby.
**5.5 Corporate headquarters**; Irvine, California, office. It
  is the intention of the parties hereto that Vega-Atlantic shall, promptly following
  the Effective Time, establish its corporate headquarters in Irvine, California,
  U.S.A.; provided, however, that Vega-Atlantic shall maintain an office in Blaine,
  Washington, U.S.A., for a period of not less than 12 months after the Effective
  Time.
**5.6 Performance of subsidiaries.** Each party hereto shall cause
  their respective Subsidiaries to comply with all its obligations hereunder and,
  subject to the terms and conditions hereof, to consummate the Merger as contemplated
  herein.
**5.7 Amendment of Schedules.** Each party hereto agrees that,
  with respect to the representations and warranties of such party contained in
  this Agreement, such party shall have the continuing obligation until the Effective
  Time to supplement or amend promptly the Schedules hereto with respect to any
  matter hereafter arising or discovered which, if existing or known at the date
  of this Agreement, would have been required to be set forth or described in
  the Schedules. For all purposes of this Agreement, including without limitation
  for purposes of determining whether the conditions set forth in Sections 6.1
  and 7.1 have been fulfilled, the Schedules hereto shall be deemed to include
  only that information contained therein on the date of this Agreement and shall
  be deemed to exclude all information contained in any supplement or amendment
  thereto; provided, however, that if the Effective Time shall occur then all
  matters disclosed pursuant to any such supplement or amendment at or prior to
  the Effective Time shall be waived and no party shall be entitled to make a
  claim thereon pursuant to the terms of this Agreement.
**5.8 Further assurances.** At and after the Effective Time the
  directors and officers of the Surviving Corporation shall be authorized to execute
  and deliver, in the name and on behalf of Transax or Newco, any deeds, bills
  of sale, assignments or assurances, and to take and do, in the name and on behalf
  of Transax or Newco, any other actions and things, to vest, perfect or confirm
  of record or otherwise in the Surviving Corporation any and all right, title
  and interest in, to and under any of the rights, properties or assets of Transax
  or Newco acquired or to be acquired by the Surviving Corporation as a result
  of, or in connection with, the Merger, and otherwise to carry out the intent
  and purpose of this Agreement.
**5.9 Expenses.** Except as otherwise expressly provided in this
  Agreement, all fees and expenses, including fees and expenses of counsel, financial
  advisors and accountants, incurred in connection with this Agreement and the
  transactions contemplated hereby shall be paid by the party incurring such fee
  or expense, whether or not the Effective Time shall have occurred. Notwithstanding
  anything contained herein to the contrary, Transax shall pay all fees and expenses
  (up to a maximum of $25,000.00) relating to the Vega-Atlantic Fairness Opinion
  (as hereinafter defined), if required; provided, however, that Transax shall
  not be obligated to pay such fees and expenses relating to the Vega-Atlantic
  Fairness Opinion if Vega-Atlantic breaches any material provision of this Agreement
  or commits an act of fraud in connection with this Agreement or the transactions
  contemplated hereby.
**5.10 Breakup fee.** In the event a party hereto terminates the
  transactions contemplated herein without good cause, the parties hereto agree
  that such non-complying party: (i) shall reimburse the other complying party,
  within 15 business days after written demand, for such party’s out-of-pocket
  expenses and fees (including, without limitation, fees and expenses of legal
  counsel, accountants financial and other advisors); and (ii) shall pay to the
  complying party, within 15 business days after written demand, the amount of
  $50,000.00; provided, however, that the total of such reimbursement (including
  such $50,000.00) payable pursuant to this Section 5.10 shall not exceed in the
  aggregate $100,000.00 (which aggregate shall include expenses and fees which
  such non-complying party is obligated to pay pursuant to Section 5.9 hereof).
  All amounts shall be paid in immediately available funds. The parties agree
  that it is impossible to determine with any reasonable accuracy the amount of
  prospective damages resulting from a party’s failure to consummate the
  Merger hereunder and agree that the damages set forth above are reasonable,
  and not a penalty, based upon the facts and circumstances of the parties at
  the time of entering into this Agreement and with due regard to future expectations.
**5.11 Exclusive dealing.** Until the Effective Time each of Transax,
  Vega-Atlantic and Newco will not, directly or indirectly, through any officer,
  director, agent or otherwise: (i) solicit, initiate or negotiate with, directly
  or indirectly, or encourage submission of inquiries, proposals or offers from,
  any third party relating to the disposition of the assets, business or any securities
  of such corporation, or any part thereof (other than transactions in the ordinary
  course or transactions which have been initiated by a party prior to the date
  hereof, which in either case will not make inadvisable or impracticable the
  consummation of the transactions contemplated herein); or (ii) subject to fiduciary
  obligations under Applicable Laws, as advised in writing by counsel, participate
  in any discussions or negotiations regarding, or furnish to any person any information
  with respect to, the disposition of the assets, business or any securities of
  such corporation or any part thereof (except as contemplated in clause (i) above),
  and none of Transax, Vega-Atlantic or Newco will unilaterally terminate the
  transactions contemplated herein without good cause. Each of Transax, Vega-Atlantic
  and Newco hereby agrees to disclose immediately to the other the receipt of
  any offer of a third party for the sale or other disposition of such corporation.
**5.12 Public disclosure.** Before the Effective Time neither
  Transax nor Vega-Atlantic, nor any of their Subsidiaries, shall make any public
  release of information regarding the matters contemplated herein except: (i)
  that press releases in agreed form shall be issued by Transax and Vega-Atlantic
  as promptly as is practicable after the execution of this Agreement; (ii) that
  Transax and Vega-Atlantic may each continue such communications with employees,
  customers, suppliers, franchisees, lenders, lessors, shareholders and other
  particular groups as may be legally required or necessary or appropriate and
  not inconsistent with the best interests of the other party or the prompt consummation
  of the transactions contemplated by this Agreement; and (iii) as required by
  Applicable Laws.

**Article VI
  CONDITIONS TO OBLIGATIONS OF TRANSAX**
The obligations of Transax to consummate the transactions contemplated by this
  Agreement shall be subject to the fulfillment on or prior to the Effective Time
  of each of the following conditions:
**6.1 Representations and warranties true.** All the representations
  and warranties of Vega-Atlantic and Newco contained in this Agreement, and in
  any agreement, instrument or document delivered pursuant hereto or in connection
  herewith on or prior to the Effective Time, shall be true and correct in all
  material respects on and as of the Effective Time as if made on and as of such
  date, except as affected by transactions permitted by this Agreement and except
  to the extent that any such representation or warranty is made as of a specified
  date, in which case such representation or warranty shall have been true and
  correct in all material respects as of such specified date.
**6.2 Covenants and agreements performed.** Vega-Atlantic and
  Newco shall have performed and complied with all covenants and agreements required
  by this Agreement to be performed or complied with by them on or prior to the
  Effective Time.
**6.3 Opinions of counsel to Vega-Atlantic.**
Transax shall have received from Diane D. Dalmy, Attorney At Law, legal
    counsel to Vega-Atlantic, a legal opinion to the effect that a vote of the
    shareholders of Vega-Atlantic is not required pursuant to the laws of the
    State of Colorado in order to approve the Merger or the transactions herein
    contemplated, substantially in the form of Exhibit G attached hereto.
  Transax shall have received an opinion of Diane D. Dalmy, Attorney At
    Law, legal counsel to Vega-Atlantic, dated the Effective Time, in the form
    of Exhibit H attached hereto.**6.4 Vega-Atlantic Fairness Opinion.** Only if required under
  all Applicable Laws, the Board of Directors of Vega-Atlantic shall have received
  a written opinion, in form and substance reasonably satisfactory to Transax,
  of a recognized investment banking firm (the “Vega-Atlantic Fairness Opinion”),
  to the effect that the proposed Merger transaction is fair, from a financial
  point of view, to such shareholders, and such opinion shall not have been amended
  or withdrawn.
**6.5 Legal Proceedings.** No Proceeding shall, on the Effective
  Time, be pending or threatened seeking to restrain, prohibit or obtain damages
  or other relief in connection with this Agreement or the consummation of the
  transactions contemplated hereby.
**6.6 No material adverse change.** Since the date of this Agreement
  there shall not have been any material adverse change in the business, assets,
  results of operations, condition (financial or otherwise) or prospects of Vega-Atlantic.
**6.7 Due diligence.** The due diligence conducted by Transax
  and its representatives in connection with the proposed transactions contemplated
  hereby shall not have caused Transax or its representatives to become aware
  of any facts relating to the business, assets, results of operations, condition
  (financial or otherwise) or prospects of Vega-Atlantic or Newco that, in the
  good faith judgment of Transax, make it inadvisable for Transax to proceed with
  the consummation of the transactions contemplated hereby.
**6.8 Other documents.** Transax shall have received the certificates,
  instruments and documents listed below:
A copy of the resolutions of the Board of Directors of Vega-Atlantic
    authorizing the execution, delivery and performance by Vega-Atlantic of this
    Agreement, certified by the Secretary or an Assistant Secretary of Vega-Atlantic.
  Copies of the resolutions of the Board of Directors of Newco, and those
    of Vega-Atlantic, as the sole shareholder of Newco, authorizing the execution,
    delivery and performance by Newco of this Agreement, certified by the Secretary
    or an Assistant Secretary of Newco.
  Certificates from the Secretary of State of Colorado, each dated not
    more than ten business days prior to the Effective Time, as to the legal existence
    and good standing, respectively, of Vega-Atlantic and Newco under the laws
    of such state, and a telegram dated the Effective Time from the Secretary
    of State of such state as to the legal existence and good standing of Vega-Atlantic
    and Newco under the laws of such state.
  A certified copy of the Articles of Incorporation of Newco as filed
    with the Office of the Secretary of State of Colorado.
  If required, a copy of the Vega-Atlantic Fairness Opinion.
  The minute books, stock records and corporate seal of Vega-Atlantic,
    certified as complete and correct as of the Effective Time by the Secretary
    or an Assistant Secretary of Vega-Atlantic.
  All Vega-Atlantic’s books and records, including without limitation
    minute books, corporate charter, Bylaws, stock records, bank account records,
    accounting records, computer records and all contracts with third parties.
  The written resignation as an officer of Vega-Atlantic and Newco of
    Grant Atkins, such resignation to be effective at the Effective Time, and
    the written resignation as a director of Newco of Grant Atkins, such resignation
    to also be effective at the Effective Time.
  A copy of the resolutions of the Board of Directors of Vega-Atlantic
    appointing such nominees to the Board of Directors of Vega-Atlantic and Newco
    as the Board of Directors of Transax may determine, in its sole and absolute
    discretion, prior to the Effective, and effective at the Effective Time, together
    with evidence of the prior filing and distribution by Vega-Atlantic to its
    shareholders and the applicable regulatory authorities of a Form 14F for the
    resulting company in compliance with Applicable Laws in order to effect the
    resulting change in the Board of Directors of Vega-Atlantic at Closing.
  A certificate of an officer of Vega-Atlantic, dated as of the Effective
    Time, acceptable in form to counsel for Transax, acting reasonably, certifying
    that the warranties, representations, covenants and agreements of Vega-Atlantic
    contained in this Agreement and in all Ancillary Documents are true and correct
    in all respects and will be true and correct as of the Effective Time as if
    made by Vega-Atlantic at the Effective Time.
  Such other certificates, instruments and documents as may be reasonably
    requested by Transax to carry out the intent and purposes of this Agreement.
**Article VII
  CONDITIONS TO OBLIGATIONS OF VEGA-ATLANTIC AND NEWCO**
The obligations of Vega-Atlantic and Newco to consummate the transactions contemplated
  by this Agreement shall be subject to the fulfillment on or prior to the Effective
  Time of each of the following conditions:
**7.1 Representations and warranties true.** All the representations
  and warranties of Transax contained in this Agreement, and in any agreement,
  instrument or document delivered pursuant hereto or in connection herewith on
  or prior to the Effective Time, shall be true and correct in all material respects
  on and as of the Effective Time as if made on and as of such date, except as
  affected by transactions permitted by this Agreement and except to the extent
  that any such representation or warranty is made as of a specified date, in
  which case such representation or warranty shall have been true and correct
  in all material respects as of such specified date.
**7.2 Covenants and agreements performed.** Transax shall have
  performed and complied with all covenants and agreements required by this Agreement
  to be performed or complied with by it on or prior to the Effective Time.
**7.3 Opinion of counsel to Transax.** Vega-Atlantic shall have
  received an opinion of Reed & Reed, P.C., Attorneys At Law, legal counsel
  to Transax, dated as of the Effective Time, in the form of Exhibit I attached
  hereto.
**7.4 Fairness opinion.** Only if required under all Applicable
  Laws, the Board of Directors of Vega-Atlantic shall have received a written
  opinion, in form and substance reasonably satisfactory to the Board, of a recognized
  investment banking firm, to the effect that the consideration to be received
  by the shareholders of Transax pursuant to the Merger is fair, from a financial
  point of view, to such shareholders, and such opinion shall not have been amended
  or withdrawn.
**7.5 Legal Proceedings.** No Proceeding shall, immediately prior
  to the Effective Time, be pending or threatened seeking to restrain, prohibit
  or obtain damages or other relief in connection with this Agreement or the consummation
  of the transactions contemplated hereby.
**7.6 No material adverse change.** Since the date of this Agreement
  there shall not have been any material adverse change in the business, assets,
  results of operations, condition (financial or otherwise) or prospects of Transax.
**7.7 Due diligence.** The due diligence conducted by Vega-Atlantic
  and its representatives in connection with the proposed transactions contemplated
  hereby shall not have caused Vega-Atlantic or its representatives to become
  aware of any facts relating to the business, assets, results of operations,
  condition (financial or otherwise) or prospects of Transax that, in the good
  faith judgment of Vega-Atlantic, make it inadvisable for Vega-Atlantic to proceed
  with the consummation of the transactions contemplated hereby.
**7.8 Other documents.** Vega-Atlantic shall have received the
  certificates, instruments, and documents listed below:
A copy of the resolutions of the Board of Directors and the shareholders
    of Transax authorizing the execution, delivery and performance by Transax
    of this Agreement, certified by the Secretary or an Assistant Secretary of
    Transax.
  A certificate from the Secretary of State of Colorado, dated not more
    than ten business days prior to the Effective Time, as to the legal existence
    and good standing of Transax under the laws of such state, and a telegram
    dated the Effective Time from the Secretary of State of such state as to the
    legal existence and good standing of Transax under the laws of such state.
  A certificate of an officer of Transax, dated as of the Effective Time,
    acceptable in form to counsel for Vega-Atlantic, acting reasonably, certifying
    that the warranties, representations, covenants and agreements of Transax
    contained in this Agreement and in all Ancillary Documents are true and correct
    in all respects and will be true and correct as of the Effective Time as if
    made by Transax at the Effective Time.
  Such other certificates, instruments and documents as may be reasonably
    requested by Vega-Atlantic to carry out the intent and purposes of this Agreement.
**Article VIII
  TERMINATION, AMENDMENT AND WAIVER**
**8.1 Termination.** This Agreement may be terminated and the
  transactions contemplated hereby abandoned at any time prior to the Effective
  Time in the following manner:
by mutual written consent of Transax and Vega-Atlantic; or
  by Transax if, immediately prior to the Effective Time, any of the conditions
    set forth in Article VI shall not have been satisfied and shall not have been
    waived by Transax; or
  by Vega-Atlantic if, immediately prior to the Effective Time, any of
    the conditions set forth in Article VII shall not have been satisfied and
    shall not have been waived by Vega-Atlantic; or
  by either Transax or Vega-Atlantic if the Effective Time shall not have
    occurred on or before August 31, 2003, unless such failure to close shall
    be due to a breach of this Agreement by the party seeking to terminate this
    Agreement pursuant to this clause (d).**8.2 Effect of termination; limitations on liability.** In the
  event of the termination of this Agreement pursuant to Section 8.1 by Vega-Atlantic,
  on the one hand, or Transax, on the other, written notice thereof shall forthwith
  be given to the other party specifying the provision hereof pursuant to which
  such termination is made, and this Agreement shall become void and have no effect,
  and there shall be no liability hereunder on the part of Vega-Atlantic, Newco
  or Transax or any of their respective Subsidiaries, directors, officers, employees,
  stockholders or representatives, except that the agreements contained in this
  Section and in the provisions contained herein regarding fees and expenses,
  confidentiality, governing law, notices, consent to jurisdiction and public
  announcements shall survive the termination hereof. In the event a party hereto
  terminates this Agreement otherwise than in accordance with Section 8.1 and
  without good cause, each of Transax and Vega-Atlantic agrees that such non-complying
  party shall pay to the complying party, within 15 business days after written
  demand, the amount of: (i) $50,000.00; plus (ii) such complying party’s
  actual and reasonable out-of-pocket expenses and fees incurred specifically
  and directly as a result of the transactions herein contemplated (including,
  without limitation, fees and expenses of legal counsel, accountants, financial
  and other advisors; provided, however, that the total of such reimbursement
  payable pursuant to clauses (i) and (ii) of this Section 8.2 shall not exceed
  in the aggregate $100,000.00; and provided further that, in the case of payments
  by Transax such $50,000.00 limitation on liability shall take into account and
  include all expenses and fees which Transax may be obligated to pay to Vega-Atlantic
  pursuant to Section 5.9 hereof, including fees relating to the Vega-Atlantic
  Fairness Opinion, if required, up to a maximum of $25,000.00. All amounts shall
  be paid in immediately available funds. The parties agree that it is impossible
  to determine with any reasonable accuracy the amount of prospective damages
  resulting from a party’s termination of this Agreement and agree that
  the damages set forth above are reasonable, and not a penalty, based upon the
  facts and circumstances of the parties at the time of entering into this Agreement
  and with due regard to future expectations.
**8.3 Waiver**. Each of Transax, on the one hand, and Vega-Atlantic
  and Newco, on the other, may: (i) waive any inaccuracies in the representations
  and warranties of the other contained herein or in any document, certificate
  or writing delivered pursuant hereto; or (ii) waive compliance by the other
  with any of the other’s agreements or fulfillment of any conditions to
  its own obligations contained herein. Any agreement on the part of a party hereto
  to any such waiver shall be valid only if set forth in an instrument in writing
  signed by or on behalf of such party. No failure or delay by a party hereto
  in exercising any right, power or privilege hereunder shall operate as a waiver
  thereof nor shall any single or partial exercise thereof preclude any other
  or further exercise thereof or the exercise of any other right, power or privilege.
**8.4 Remedies exclusive.** The rights and remedies herein provided
  shall be in addition to any other rights or remedies provided by law. The rights
  and remedies of any party based upon, arising out of or otherwise in respect
  of any inaccuracy in or breach of any representation, warranty, covenant or
  agreement contained in this Agreement shall in no way be limited by the fact
  that the act, omission, occurrence or other state of facts upon which any claim
  of any such inaccuracy or breach is based may also be the subject matter of
  any other representation, warranty, covenant or agreement contained in this
  Agreement (or in any other agreement between the parties) as to which there
  is no inaccuracy or breach.

**Article IX
  INDEMNIFICATION FOLLOWING EFFECTIVE TIME**
**9.1 Survival.**
The representations and warranties of the parties hereto contained in
    this Agreement or in any certificate, instrument or document delivered pursuant
    hereto shall survive the Effective Time, regardless of any investigation made
    by or on behalf of any party, until the first anniversary of the Effective
    Time (such anniversary, the “Survival Date”). From and after the
    Survival Date no party hereto or any shareholder, director, officer, employee
    or affiliate of such party shall be under any liability whatsoever pursuant
    to this Article IX with respect to any such representation or warranty, except
    with respect to matters as to which notice has been received in accordance
    with Section 9.1(b).
  No party hereto shall have any indemnification obligation pursuant to
    this Article IX in respect of any representation or warranty unless before
    the Survival Date it shall have received from the party seeking indemnification
    written notice of the existence of the claim for or in respect of which indemnification
    in respect of such representation or warranty is sought. Such notice shall
    set forth with reasonable specificity: (i) the basis under this Agreement,
    and the facts that otherwise form the basis, of such claim; (ii) an estimate
    of the amount of such claim (which estimate shall not be conclusive of the
    final amount of such claim) and an explanation of the calculation of such
    estimate, including a statement of any significant assumptions employed therein;
    and (iii) the date on and manner in which the party delivering such notice
    became aware of the existence of such claim; provided, however, that any notice
    which the party seeking indemnification delivers to the indemnifying party
    prior to the Survival Date which notifies the indemnifying party of the existence
    of a claim and, notwithstanding the failure of such notice to meet the requirements
    set forth in clauses (i), (ii) and (iii) above, does not materially prejudice
    the indemnifying party’s ability to defend such claim, shall be deemed
    to have met the requirement of delivery of notice prior to the Survival Date
    for the purpose of preserving the indemnified party’s right to indemnification
    pursuant to this Article IX.
  The provisions of this Section shall have no effect upon any other obligation
    of the parties hereto under this Agreement whether to be performed before,
    at or after the Effective Time.**9.2 Indemnification by Vega-Atlantic and Newco.** Subject to
  the terms and conditions of this Article IX, Vega-Atlantic shall indemnify,
  defend and hold harmless Transax from and against any and all claims, actions,
  causes of action, demands, assessments, losses, damages, liabilities, judgments,
  settlements, penalties, costs and expenses (including reasonable attorneys’
  fees and expenses) of any nature whatsoever (collectively, the “*Damages*”),
  asserted against, resulting to, imposed upon or incurred by Transax, directly
  or indirectly, following the Effective Time, by reason of or resulting from
  any breach by Vega-Atlantic or Newco of any of its representations and warranties
  contained in this Agreement or in any certificate, instrument or Ancillary Document
  delivered pursuant hereto (collectively, the “*Transax Claims*”).
  Neither Vega-Atlantic nor Newco shall be entitled to any contribution or reimbursement
  from Transax with respect to payments made by Vega-Atlantic, Newco or both under
  this Article IX. The indemnification obligations of Vega-Atlantic and Newco
  pursuant to this Section shall only apply to the extent that the aggregate Damages
  incurred in connection with the Transax Claims exceed $100,000.00.
**9.3 Indemnification by Transax.** Subject to the terms and conditions
  of this Article IX, Transax shall indemnify, defend and hold harmless Vega-Atlantic
  and Newco from and against any and all claims, actions, causes of action, demands,
  assessments, losses, damages, liabilities, judgments, settlements, penalties,
  costs and expenses (including reasonable attorneys’ fees and expenses)
  of any nature whatsoever (collectively, again, the “Damages”), asserted
  against, resulting to, imposed upon or incurred by Vega-Atlantic or Newco, directly
  or indirectly, following the Effective Time, by reason of or resulting from
  any breach by Transax of any of its representations and warranties contained
  in this Agreement or in any certificate, instrument or Ancillary Document delivered
  pursuant hereto (collectively, the “Vega-Atlantic Claims”). Transax
  shall not be entitled to any contribution or reimbursement from Vega-Atlantic
  or Newco with respect to payments made by Transax under this Article IX. The
  indemnification obligations of Transax pursuant to this Section shall only apply
  to the extent that the aggregate Damages incurred in connection with the Vega-Atlantic
  Claims exceed $100,000.00.
**9.4 Procedure for indemnification.** Promptly after receipt
  by an indemnified party under Section 9.2 or 9.3 of notice of the commencement
  of any action, such indemnified party shall, if a claim in respect thereof is
  to be made against an indemnifying party under such Section, give written notice
  to the indemnifying party of the commencement thereof, but the failure so to
  notify the indemnifying party shall not relieve it of any liability that it
  may have to any indemnified party except to the extent the indemnifying party
  demonstrates that the defense of such action is prejudiced thereby. In case
  any such action shall be brought against an indemnified party and it shall give
  written notice to the indemnifying party of the commencement thereof, the indemnifying
  party shall be entitled to participate therein and, to the extent that it may
  wish, to assume the defense thereof with counsel reasonably satisfactory to
  such indemnified party. If the indemnifying party elects to assume the defense
  of such action the indemnified party shall have the right to employ separate
  counsel at its own expense and to participate in the defense thereof. If the
  indemnifying party elects not to assume (or fails to assume) the defense of
  such action the indemnified party shall be entitled to assume the defense of
  such action with counsel of its own choice, at the expense of the indemnifying
  party. If the action is asserted against both the indemnifying party and the
  indemnified party and there is a conflict of interests which renders it inappropriate
  for the same counsel to represent both the indemnifying party and the indemnified
  party, the indemnifying party shall be responsible for paying for separate counsel
  for the indemnified party; provided, however, that if there is more than one
  indemnified party, the indemnifying party shall not be responsible for paying
  for more than one separate firm of attorneys to represent the indemnified parties,
  regardless of the number of indemnified parties. If the indemnifying party elects
  to assume the defense of such action: (i) no compromise or settlement thereof
  may be effected by the indemnifying party without the indemnified party’s
  written consent (which shall not be unreasonably withheld) unless the sole relief
  provided is monetary damages that are paid in full by the indemnifying party;
  and (ii) the indemnifying party shall have no liability with respect to any
  compromise or settlement thereof effected without its written consent (which
  shall not be unreasonably withheld).

**Article X
  MISCELLANEOUS**
**10.1 Notices.** All notices, requests, demands and other communications
  required or permitted to be given or made hereunder by any party hereto shall
  be in writing and shall be deemed to have been duly given or made if: (i) delivered
  personally; (ii) transmitted by first class registered or certified mail, postage
  prepaid, return receipt requested; (iii) sent by prepaid overnight courier service;
  or (iv) sent by telecopy or facsimile transmission, answer back requested, to
  the parties at the following addresses (or at such other addresses as shall
  be specified by the parties by like notice):
If to Vega-Atlantic or Newco:
  Vega-Atlantic Corporation
      435 Martin Street, Suite 2000
      Blaine, Washington
      U.S.A., 98230
      Attention: Mr. Grant Atkins, President
      Telefax: (360) 332-1643;
  with a copy to:
  Diane D. Dalmy
      Attorney At Law
      8965 West Cornell Place
      Lakewood, Colorado
      U.S.A., 80227
      Attention: Ms. Diane D. Dalmy
      Telefax: (303) 988-9324;
  and with a copy to:
  Devlin Jensen
      Barristers & Solicitors
      Suite 2550, 555 West Hastings Street
      Vancouver, British Columbia
      Canada, V6B 4N5
      Attention: Mr. Thomas J. Deutsch
      Telefax: (604) 684-0916;
  and If to Transax and the Founding Shareholders:
  Transax Limited
      Irvine Spectrum Center
      Suite 200, 7545 Irvine Center Drive
      Irvine, California
      U.S.A., 92618
      Attention: Mr. Stephen Walters, President
      Telefax: (949) 623-8305;
  with a copy to:
  The Law Office of Reed & Reed, P.C.
      Attorneys At Law
      4450 Arapahoe Avenue, Suite 100
      Boulder, Colorado
      U.S.A., 80303
      Attention: Mr. Scott M. Reed
      Telefax: (303) 499-2554.
Such notices, requests, demands and other communications shall be effective:
  (i) if delivered personally or sent by courier service, upon actual receipt
  by the intended recipient; (ii) if mailed, upon the earlier of five business
  days after deposit in the mail or the date of delivery as shown by the return
  receipt therefor; or (iii) if sent by telecopy or facsimile transmission, when
  the answer back is received.
**10.2 Entire agreement.** This Agreement, together with the Schedules,
  Exhibits Annexes and other writings referred to herein or delivered pursuant
  hereto, constitute the entire agreement between the parties hereto with respect
  to the subject matter hereof and supersede all prior agreements and understandings,
  both written and oral, between the parties with respect to the subject matter
  hereof.
**10.3 Binding effect; assignment; no third party benefit.** This
  Agreement shall be binding upon and inure to the benefit of the parties hereto
  and their respective successors and permitted assigns; provided, however, that
  neither this Agreement nor any of the rights, interests or obligations hereunder
  shall be assigned by any of the parties hereto (by operation of law or otherwise)
  without the prior written consent of the other parties, except that Newco may
  assign to Vega-Atlantic or any other direct or indirect wholly-owned subsidiary
  of Vega-Atlantic any of Newco’s rights, interests or obligations hereunder.
  Except as provided for in the Sections of this Agreement providing for indemnification,
  nothing in this Agreement, express or implied, is intended to or shall confer
  upon any person other than Vega-Atlantic, Newco and Transax any rights, benefits
  or remedies of any nature whatsoever under or by reason of this Agreement.
**10.4 Severability.** If any provision of this Agreement is held
  to be unenforceable, this Agreement shall be considered divisible and such provision
  shall be deemed inoperative to the extent it is deemed unenforceable, and in
  all other respects this Agreement shall remain in full force and effect; provided,
  however, that if any such provision may be made enforceable by limitation thereof,
  then such provision shall be deemed to be so limited and shall be enforceable
  to the maximum extent permitted by Applicable Laws.
**10.5 Governing law.** This agreement shall be governed by and
  construed and enforced in accordance with the laws of the State of Colorado
  without regard to the principles of conflicts of laws thereof.
**10.6 Descriptive headings.** The descriptive headings herein
  are inserted for convenience of reference only, do not constitute a part of
  this Agreement and shall not affect in any manner the meaning or interpretation
  of this Agreement.
**10.7 Gender.** Pronouns in masculine, feminine and neuter genders
  shall be construed to include any other gender, and words in the singular form
  shall be construed to include the plural, and vice versa, unless the context
  otherwise requires.
**10.8 References.** All references in this Agreement to Articles,
  Sections and other subdivisions refer to the Articles, Sections and other subdivisions
  of this Agreement unless expressly provided otherwise. The words “this
  Agreement”, “herein”, “hereof”, “hereby”,
  “hereunder” and words of similar import refer to this Agreement
  as a whole and not to any particular subdivision unless expressly so limited.
  Whenever the words “include”, “includes” and “including”
  are used in this Agreement, such words shall be deemed to be followed by the
  words “without limitation”. Each reference herein to a Schedule,
  Exhibit or Annex refers to the item identified separately in writing by the
  parties hereto as the described Schedule, Exhibit or Annex to this Agreement.
  All Schedules, Exhibits and Annexes are hereby incorporated in and made a part
  of this Agreement as if set forth in full herein.
**10.9 Counterparts.** This Agreement may be executed by the parties
  hereto in any number of counterparts, each of which shall be deemed an original,
  but all of which shall constitute one and the same agreement. Each counterpart
  may consist of a number of copies hereof each signed by less than all, but together
  signed by all, the parties hereto.
**10.10 Injunctive relief.** The parties hereto acknowledge and
  agree that irreparable damage would occur in the event any of the provisions
  of this Agreement were not performed in accordance with their specific terms
  or were otherwise breached. It is accordingly agreed that the parties shall
  be entitled to an injunction or injunctions to prevent breaches of the provisions
  of this Agreement, and shall be entitled to enforce specifically the provisions
  of this Agreement, in any court of the United States or any state thereof having
  jurisdiction, in addition to any other remedy to which the parties may be entitled
  under this Agreement or at law or in equity.
**10.11 Consent to jurisdiction.**
The parties hereto hereby irrevocably submit to the jurisdiction of
    the courts of the State of Colorado and the federal courts of the United States
    of America located in the State of Colorado, and appropriate appellate courts
    therefrom, over any dispute arising out of or relating to this Agreement or
    any of the transactions contemplated hereby, and each party hereby irrevocably
    agrees that all claims in respect of such dispute or proceeding may be heard
    and determined in such court. The parties hereby irrevocably waive, to the
    fullest extent permitted by Applicable Laws, any objection which they may
    now or hereafter have to the laying of venue of any dispute arising out of
    or relating to this Agreement or any of the transactions contemplated hereby
    brought in such court or any defense of inconvenient forum for the maintenance
    of such dispute. Each of the parties hereto agrees that a judgment in any
    such dispute may be enforced in other jurisdictions by suit on the judgment
    or in any other manner provided by law. This consent to jurisdiction is being
    given solely for purposes of this Agreement and is not intended to, and shall
    not, confer consent to jurisdiction with respect to any other dispute in which
    a party to this Agreement may become involved.
  If permitted by Applicable Laws, each of the parties hereto hereby consents
    to process being served by any party to this Agreement in any suit, action
    or proceeding of the nature specified in subsection (a) above by the mailing
    of a copy thereof in the manner specified by the provisions of Section 10.1.
**Article XI
  DEFINITIONS**
**11.1 Certain defined terms**. As used in this Agreement, each
  of the following terms has the meaning given it below:
“*affiliate*” has the meaning specified in Rule 12b-2
    promulgated under the Exchange Act.
  “*Agreement In Principle*” shall have the meaning set
    forth in the preamble to this Agreement.
  “*Ancillary Documents*” means each agreement, instrument
    and document (other than this Agreement) executed or to be executed by Transax,
    Vega-Atlantic or Newco in connection with the transactions contemplated by
    this Agreement, including without limitation the Agreement and Plan of Merger.
  “*Applicable Environmental Laws*” shall have the meaning
    set forth in Section 2.18.
  “*Applicable Law*” and “*Applicable Laws*”
    means any statute, law, rule or regulation or any judgment, order, writ, injunction
    or decree of any Governmental Entity to which a specified person or property
    is subject.
  “*Articles of Merger*” shall have the meaning set forth
    in Section 1.1.
  “*Benefit Plans*” shall have the meaning set forth in
    Section 3.20.
  “*Board of Directors*” means the Board of Directors of
    any of the Constituent Corporations hereunder, as duly constituted from time
    to time.
  “*business day*” means any day during which a United
    States chartered bank is open for business in the City of Irvine, California,
    U.S.A.
  “*Carlingford*” shall have the meaning set forth in Section
    2.4.
  “*CBCA*” shall have the meaning set forth in Section
    1.1.
  “*Certificates*” shall have the meaning set forth in
    Section 1.5.
  “*Closing*” means the due and complete closing of each
    of the transactions which are contemplated by the terms and conditions of
    this Agreement and all Ancillary Documents contemplated hereby.
  “*Code*” means the Internal Revenue Code of 1986, as
    amended and in effect as of the Effective Time.
  “*Colorado Law*” shall have the meaning set forth in
    Section 1.7.
  “*Common Stock Exchange Ratio*” shall have the meaning
    set forth in Section 1.4.
  “*Constituent Corporations*” means each of Vega-Atlantic,
    Newco and Transax.
  “*Contribution Agreement*” shall have the meaning set
    forth in Section 1.1.
  “*Consulting Agreement*” shall have the meaning set forth
    in Section 3.29.
  “*Damages*” shall have the meaning set forth in Section
    9.2.
  “*Discharges*” shall have the meaning set forth in Section
    1.10.
  “*Dissenting Shares*” shall have the meaning set forth
    in Section 1.7.
  “*Effective Time*” shall have the meaning set forth in
    Section 1.2.
  “*Election Form*” shall have the meaning set forth in
    Section 1.10.
  “*Encumbrances*” means liens, charges, pledges, options,
    mortgages, deeds of trust, security interests, claims, restrictions (whether
    on voting, sale, transfer, disposition, or otherwise), easements and other
    encumbrances of every type and description, whether imposed by law, agreement,
    understanding or otherwise.
  “*Equity Interest*” shall have the meaning set forth
    in Section 1.10.
  “*Equity Interest Documentation*” shall have the meaning
    set forth in Section 1.10.
  “*Escrow Holder*” shall have the meaning set forth in
    Section 1.10.
  “*ERISA*” means the Employee Retirement Income Security
    Act of 1974, as amended.
  “*Exchange Act*” means the Securities Exchange Act of
    1934, as amended.
  “*Exchange Agent*” shall have the meaning set forth in
    Section 1.5.
  “*Final Principal Sum Payment Date*” shall have the meaning
    set forth in Section 1.10.
  “*Form 14F*” shall have the meaning set forth in Section
    3.29.
  “*Form S-8*” shall have the meaning set forth in Section
    3.29.
  “*Funding*” shall have the meaning set forth in Section
    3.29.
  “*Governmental Entity*” means any court or tribunal in
    any jurisdiction (domestic or foreign) or any federal, state, municipal or
    other governmental body, agency, authority, department, commission, board,
    bureau or instrumentality (domestic or foreign).
  “*hazardous material*” shall have the meaning set forth
    in Section 3.21.
  “*Intellectual Property*” means patents, trademarks,
    service marks, trade names, service names, brand names, copyrights, trade
    secrets, know-how, technology, inventions, computer software (including documentation
    and object and source codes) and similar rights and all registrations, applications,
    licenses and rights with respect to any of the foregoing.
  “*Interest*” shall have the meaning set forth in Section
    1.10.
  “*IRS*” means the Internal Revenue Service.
  “*knowledge*” of a specified person (or similar references
    to a person’s knowledge) means that the only information to be attributed
    to such person is information actually known to: (i) such person in the case
    of an individual; or (ii) in the case of a corporation or other entity, an
    executive, officer or employee who devoted substantive attention to matters
    of such nature during the ordinary course of his employment by such person.
  “*Loan*” shall have the meaning set forth in Section
    1.10.
  “*Loan Agreement*” shall have the meaning set forth in
    Section 1.10.
  “*Material Adverse Effect*” means any change, development,
    or effect (individually or in the aggregate) which is, or is reasonably likely
    to be, materially adverse (i) to the business, assets, results of operations,
    condition (financial or otherwise), or prospects of the applicable party hereto
    or (ii) to the ability of such party to perform on a timely basis any material
    obligation under this Agreement or any agreement, instrument, or document
    entered into or delivered in connection herewith.
  “*Merger*” shall have the meaning set forth in the preamble
    to this Agreement.
  “*Merger Consideration*” shall have the meaning set forth
    in Section 1.5.
  “*Newco*” means Vega-Atlantic Acquisition Corporation,
    a Colorado corporation and a wholly-owned subsidiary of Vega-Atlantic.
  “*Options*” shall have the meaning set forth in Section
    3.29.
  “*Outstanding Indebtedness*” shall have the meaning set
    forth in Section 1.10.
  “*Permits*” means licenses, permits, franchises, consents,
    approvals, variances, exemptions and other authorizations of or from Governmental
    Entities.
  “*Plan*” shall have the meaning set forth in Section
    1.1.
  “*Principal Sum*” shall have the meaning set forth in
    Section 1.10.
  “*Private Placement*” shall have the meaning set forth
    in Section 3.29.
  “*Private Purchase and Sale*” shall have the meaning
    set forth in Section 1.12.
  “*Proceedings*” means all proceedings, actions, claims,
    suits, investigations, and inquiries by or before any arbitrator or Governmental
    Entity.
  “*reasonable best efforts*” means, whenever used with
    reference to a party’s obligation, an obligation of such party to use
    every reasonable commercial effort, but shall not be interpreted to require
    such party to take any action or refrain from taking any action that would
    be materially burdensome to such party or to amend this Agreement or any agreement
    contemplated hereby or to forego or waive any of its rights hereunder or thereunder.
  “*Redemption Amount*” shall have the meaning set forth
    in Section 1.10.
  “*Redemption Date*” shall have the meaning set forth
    in Section 1.10.
  “*Redemption Notice*” shall have the meaning set forth
    in Section 1.10.
  “*Registration Statement*” shall have the meaning set
    forth in Section 1.9.
  “*Regulation S*” shall have the meaning set forth in
    Section 1.9.
  “*Right of Election*” shall have the meaning set forth
    in Section 1.10.
  “*Right of Redemption*” shall have the meaning set forth
    in Section 1.10.
  “*Rule 144*” shall have the meaning set forth in Section
    1.9.
  “*Rule 506*” shall have the meaning set forth in Section
    1.9.
  “*SEC Filings*” shall have the meaning set forth in Section
    3.10.
  “*Securities Act*” means the Securities Act of 1933,
    as amended.
  “*Security*” shall have the meaning set forth in Section
    1.10.
  “*Selling Shareholders*” means the following shareholders
    of Transax who have executed this Agreement: Atlas Alpha Corporation; Cardlink
    Worldwide Inc., Carlingford and Engtech Inc.
  “*Special Meeting*” shall have the meaning set forth
    in Section 5.2.
  “*Subsidiary*” and “*Subsidiaries*”
    means, individually and collectively, any entity or entities of which securities
    or other ownership interests having ordinary voting power to elect a majority
    of the board of directors or other persons performing similar functions are
    owned, directly or indirectly, by the applicable party hereto.
  “*Survival Date*” shall have the meaning set forth in
    Section 9.1.
  “*Surviving Corporation*” shall have the meaning set
    forth in Section 1.1.
  “*Tax*” or “*Taxes*” means, individually
    and collectively, any income taxes or similar assessments or any sales, excise,
    occupation, use, ad valorem, property, production, severance, transportation,
    employment, payroll, franchise or other tax imposed by any United States federal,
    state or local (or any foreign) taxing authority, including any interest,
    penalties or additions attributable thereto.
  “*Tax Return*” means any return or report, including
    any related or supporting information, with respect to Taxes.
  “*Transax*” means Transax Limited, a Colorado corporation.
  “*Transax Balance Sheet Date*” shall have the meaning
    set forth in Section 2.9.
  “*Transax Claims*” shall have the meaning set forth in
    Section 9.2.
  “*Transax Common Stock*” shall have the meaning set forth
    in Section 1.3.
  “*Transax Financial Statements*” shall have the meaning set
    forth in Section 2.9.
  “*Transax Options*” shall have the meaning set forth in Section
    1.3.
  “*Transax Shares*” shall have the meaning set forth in Section
    1.3.
  “*Transax Securities*” shall have the meaning set forth in
    Section 1.3.
  “*Transax Warrants*” shall have the meaning set forth in
    Section 1.3.
  “*US GAAP*” shall have the meaning set forth in Section 2.9.
  “*Vega-Atlantic*” means Vega-Atlantic Corporation, a Colorado
    corporation.
  “*Vega-Atlantic Balance Sheet Date*” shall have the meaning
    set forth in Section 3.9.
  “*Vega-Atlantic Claims*” shall have the meaning set forth
    in Section 9.3.
  “*Vega-Atlantic Common Stoc*” shall have the meaning set
    forth in the preamble to this Agreement.
  “*Vega-Atlantic Fairness Opinion*” shall have the meaning
    set forth in Section 6.4.
  “*Vega-Atlantic Financial Statements*” shall have the meaning
    set forth in Section 3.9.
  “*Vega-Atlantic Options*” shall have the meaning set forth
    in the preamble to this Agreement.
  “*Vega-Atlantic Securities*” shall have the meaning set forth
    in Section 1.4.
  “*Vega-Atlantic Shares*” shall have the meaning set forth
    in the preamble to this Agreement.
  “*Vega-Atlantic Warrants*” shall have the meaning set forth
    in the preamble to this Agreement.**IN WITNESS WHEREOF,** each of the parties hereto has caused
  this Agreement to be executed on its behalf by its representative thereunto
  duly authorized, all as of the day and year first above written.
The COMMON SEAL of)
  VEGA-ATLANTIC CORPORATION, )
  Vega-Atlantic herein, was hereunto affixed )
  in the presence of: ) (C/S)
  )
  ____________________)
  Authorized Signatory )
The COMMON SEAL of )
  TRANSAX LIMITED, )
  Transax herein, was hereunto affixed )
  in the presence of: ) (C/S)
  )
  ____________________)
  Authorized Signatory )
The COMMON SEAL of ) No. of Transax Shares: 51,063
  ATLAS ALPHA CORPORATION, )
  a Selling Shareholder herein, )
  was hereunto affixed in the presence of: ) (C/S)
  )
  ____________________)
  Authorized Signatory )
The COMMON SEAL of ) No. of Transax Shares: 2,383,740
  CARDLINK WORLDWIDE INC. )
  (HELD IN TRUST), )
  a Selling Shareholder herein, )
  was hereunto affixed in the presence of: ) (C/S)
  )
  ____________________)
  Authorized Signatory )
  The COMMON SEAL of ) No. of Transax Shares: 17,454,849
  CARLINGFORD INVESTMENTS LTD. )
  (ON BEHALF OF ITS INVESTORS), )
  a Selling Shareholder herein, )
  was hereunto affixed in the presence of: ) (C/S)
  )
  ____________________)
  Authorized Signatory )
The COMMON SEAL of ) No. of Transax Shares: 63,410
  ENGTECH INC., )
  a Selling Shareholder herein, )
  was hereunto affixed in the presence of: ) (C/S)
  )
  ____________________)
  Authorized Signatory )

**Exhibit A**
This is Exhibit A to that certain Merger Agreement among each
  of Vega-Atlantic, Newco, Transax and certain Selling Shareholders of Transax.
**Agreement In Principle**
Refer to the materials attached hereto.

**Exhibit B**
This is Exhibit B to that certain Merger Agreement among each
  of Vega-Atlantic, Newco, Transax and certain Selling Shareholders of Transax.
**Agreement and Plan of Merger**
Refer to the materials attached hereto.
**Exhibit C**
This is Exhibit C to that certain Merger Agreement among each
  of Vega-Atlantic, Newco, Transax and certain Selling Shareholders of Transax.
**Articles of Merger**
Refer to the materials attached hereto.
**Exhibit D**
This is Exhibit D to that certain Merger Agreement among each
  of Vega-Atlantic, Newco, Transax and certain Selling Shareholders of Transax.
**Contribution Agreement**
Refer to the materials attached hereto.
**Exhibit E**
This is Exhibit E to that certain Merger Agreement among each
  of Vega-Atlantic, Newco, Transax and certain Selling Shareholders of Transax.
**Loan Agreement**
Refer to the materials attached hereto.
**Exhibit F**
This is Exhibit F to that certain Merger Agreement among each
  of Vega-Atlantic, Newco, Transax and certain Selling Shareholders of Transax.
**Consulting Agreement**
Refer to the materials attached hereto.
**Exhibit G**
This is Exhibit G to that certain Merger Agreement among each
  of Vega-Atlantic, Newco, Transax and certain Selling Shareholders of Transax.
**Approval Opinion of Counsel**
Refer to the materials attached hereto.
**Exhibit H**
This is Exhibit H to that certain Merger Agreement among each
  of Vega-Atlantic, Newco, Transax and certain Selling Shareholders of Transax.
**Customary Opinion of Counsel to Vega-Atlantic**
Refer to the materials attached hereto.
**Exhibit I**
This is Exhibit I to that certain Merger Agreement among each
  of Vega-Atlantic, Newco, Transax and certain Selling Shareholders of Transax.
**Customary Opinion of Counsel to Transax**
Refer to the materials attached hereto.




Back to Table of Contents
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

---

|**EXHIBIT 10.1**
			**TRANSAX INTERNATIONAL LIMITED and SUBSIDIARIES**
			(Formerly Vega-Atlantic Corporation)**[A Development Stage Company]
			Stock Option Plan**Back to Table of Contents
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|**TRANSAX LIMITED**
**2003 INCENTIVE STOCK OPTION PLAN**
**SECTION 1
  INTRODUCTION**
*1.1 Establishment.* Transax Limited (the “Company”), a Colorado
  corporation, hereby establishes the Transax Limited 2003 Stock Option Plan (the
  “Plan”) for employees, consultants, directors, and other persons
  associated with the Company whom the Board wishes to incentivise. Transax Limited,
  together with its affiliated corporations, as defined in Section 2.1 hereafter,
  are referred to as the “Company”, except where the context otherwise
  requires.
*1.2 Purposes.* The purposes of this Plan are to (i) attract and retain
  the best available personnel for positions of responsibility within the Company
  (ii) provide incentives to employees, officers, and management of the Company,
  (iii) provide Directors, Consultants and Advisors of the Company with an opportunity
  to acquire a proprietary interest in the Company to encourage their continued
  provision of services to the Company, and to provide such persons with incentives
  and rewards for superior performance more directly linked to the profitability
  of the Company's business and increases in shareholder value, and (iv) generally
  to promote the success of the Company's business and the interests of the Company
  and all of its stockholders, through the grant of options to purchase shares
  of the Company's Common Stock.
Incentive benefits granted hereunder may be either Incentive Stock Options,
  Non-qualified Stock Options, stock awards, Restricted Shares or cash awards.
  The types of options or other incentives granted shall be determined by the
  board or the Compensation Committee and reflected in the terms of written agreements.

SECTION 2
  DEFINITIONS
*2.1 Definitions.*The following terms will have the meanings set forth
  below:
“*Affiliated Corporation*” means any corporation or other
  entity (including, but not limited to, a partnership) that is affiliated with
  the Company through stock ownership or otherwise.
“*Board*” means the Board of Directors of the Company.
“*Code*” means the Internal Revenue Code of the USA or the
  Income Tax Act of Canada, as it may be amended form time to time, and as appropriate
  to the context and as applies to the Eligible Participant.
“*Effective Date*” means the effective date of the Plan,
  which will be January 1st 2003.
“*Eligible Participants*” means any employees (including,
  without limitation, all officers), directors, consultants and any other persons
  whom the Board wishes to incentivise to contribute to the fortunes of the Company
  and permitted by law or policy to receive options.
“*Fair Value*” means the value of a Share of Stock as determined
  by the Stock Option Committee acting in good faith and in its sole discretion
  in accordance with this Agreement. Notwithstanding the above, if the Stock is
  actively traded in an established stock or quotation market, “Fair Value”
  will mean the officially quoted closing price of the Stock on such exchange
  (a “National Exchange”) on a particular date selected by the Stock
  Option Committee in establishing the purchase price of Shares of the Option.
“*Stock Option Committee*” means the Compensation Committee
  of the Company, unless the Board strikes a separate committee, and in the absence
  of an empowered committee shall mean the Board.
“*Non-Statutory Option*” means an Option granted under this
  Plan in accordance with the requirements of the Code, as amended from time to
  time.
“*Option*” means a right to purchase Stock of the Company
  granted under this Plan at a stated price for a specified period of time.
“*Option Price*” means the price at which shares of Stock
  subject to an Option may be purchased, determined in accordance with this Agreement
  and as established by the Stock Option Committee and contracted by the Option
  contract.
“*Option Holder*” means an Eligible Participant designated
  by the Stock Option Committee from time to time during the term of the Plan
  to receive one or more Options under the Plan.
“*Plan Limit*” shall have the meaning set forth in section
  4.1.
“*Share*” or “*Shares*” means a share
  or shares of Stock.
“*Stock*” means the common stock of the Company.
*2.2 Gender and Number.* Except where otherwise indicated by the context,
  the masculine gender also will include the feminine gender, and the definition
  of any term herein in the singular also will include the plural.

SECTION 3
  PLAN ADMINISTRATION
*3.1 Stock Option Committee.* The Stock Option Committee will administer
  the Plan. In accordance with the provisions of the Plan, the Stock Option Committee
  will, in accordance with policies ordered by the Board but in the absence of
  board direction in its sole discretion, select the Eligible Participants to
  whom Options will be granted, the form of each Option, the amount of each Option,
  and any other terms and conditions of each Option as the Stock Option Committee
  may deem necessary and consistent with the terms of the Plan. The Stock Option
  Committee will determine the form or forms of the agreements with Option Holders.
  The agreements will evidence the particular provisions, terms, conditions, rights
  and duties of the Company and the Option Holders with respect to Options granted
  pursuant to the Plan, which provisions need not be identical except as may be
  provided herein. The Stock Option Committee may from time to time adopt such
  rules and regulations for carrying out the purposes of the Plan as it may deem
  proper and in the best interests of the Company. The Stock Option Committee
  may correct any defect, supply any omission or reconcile any inconsistency in
  the Plan or in any agreement entered into hereunder in the manner and to the
  extent it may deem expedient and it will be the sole and final judge of such
  expediency. No member of the Stock Option Committee will be liable for any action
  or determination made in good faith, and all members of the Committee will,
  in addition to their rights as directors, be fully protected by the Company
  with respect to any such action, determination or interpretation. The determinations,
  interpretations and other actions of the Stock Option Committee pursuant to
  the provisions of the Plan will be binding and conclusive for all purposes and
  on all persons.

SECTION 4
  STOCK SUBJECT TO THE PLAN AND EXCEPTIONS
*4.1 Plan limit.* A maximum of 4,500,000 Shares (“Plan Limit”)
  are authorized for issuance under the Plan in accordance with the provisions
  of the Plan. Shares that are issued upon the exercise of Options will be deducted
  from the Plan Limit and such Plan Limit shall not be increased without approval
  of the board or, if shareholders of the Company have so required, without approval
  of the shareholders of the Company. While any Options are outstanding, the Company
  will retain as authorized and unissued Stock at least the number of Shares from
  time to time required under the provisions of the Plan or otherwise assure itself
  of its ability to perform its obligations hereunder.
*4.2 Unused and Forfeited Stock.* Any Shares that are subject to an Option
  under this Plan that are not used because the terms and conditions of the Option
  are not met or any Shares that are used for full or partial payment of the purchase
  price of Shares with respect to which an Option is exercised or any Shares retained
  by the Company for any purpose of this Plan automatically will be returned to
  the Plan Limit and become available for again for use under the Plan.
*4.3 Adjustments for Stock Split, Stock Dividend, Etc*. If the Company
  at any time increases or decreases the number of its outstanding Shares of Stock,
  or changes in any way the rights and privileges of such Shares by means of the
  Payment of a Stock dividend or any other distribution upon such Shares payable
  in Stock, or through a stock split, subdivision, consolidation, combination,
  reclassification or recapitialization involving the Stock, then, in relation
  to the Stock that is affected by the above events, the provisions of this Section
  4.3 will apply. In such event, the numbers, rights and privileges of the following
  will be increased, decreased or changed in like manner as if such shares had
  been issued and outstanding, fully paid and nonassessable at the time of such
  event:adjustment to the Shares of Stock as to which Options may be granted under
  the Plan; and
  adjustment to the exercise price of each outstanding Option granted hereunder.*4.4 General Adjustment Rules.* If any adjustment or substitution provided
  for in this Section 4 will result in the creation of a fractional Share under
  any Option, the number of Shares subject to the Option will be rounded to the
  next higher Share.
*4.5 Determination by Stock Option Committee, Etc.* Adjustments under
  this Section 4 will be made by the Stock Option Committee, whose determinations
  with regard thereto will be final and binding upon all parties.
*4.6 Options Exceptional to Plan.* With the concurrence of the board,
  the Stock Option Committee may grant Options outside the Plan or within the
  Plan but in excess of the Plan Limit, such that the available Plan Limit is
  not diminished, for exceptional circumstances or to acquire or retain personnel
  or achieve important goals or strategic targets considered important to the
  Company but which cannot reasonably be fit into the Plan Limit or the Plan due
  to insufficiency of available Plan Options, legal impediments whereby the recipient
  cannot or is best not included in the Plan, or other purposes or reasons considered
  appropriate to the board.

SECTION 5
  REORGANIZATION OR LIQUIDATION
*5.1 Reorganization and Options.* In the event that the Company is merged
  or consolidated with another corporation (other than a merger or consolidation
  in which the Company is the continuing corporation and that does not result
  in any reclassification or change of outstanding Shares), or if all or substantially
  all of the assets or control of the outstanding voting stock of the Company
  is acquired by any other corporation, business entity or person (other than
  by a sale or conveyance in which the Company continues as a holding company
  of an entity or entities that conduct the business of businesses formerly conducted
  by the Company), or in case of a reorganization (other than a reorganization
  under the United States Bankruptcy Code) or liquidation of the Company, the
  Stock Option Committee will have the power and discretion to prescribe the terms
  and conditions for the exercise or modification of any outstanding Options granted
  hereunder. By way of illustration, and not by way of limitation, the Stock Option
  Committee may provide for the complete or partial acceleration of the dates
  of exercise of the Options, or may provide that such Options will be exchanged
  or converted into options to acquire securities of the surviving or acquiring
  cooperation, or may provide for a payment or distribution in respect of outstanding
  Options (or the portion thereof that currently is exercisable) in cancellation
  thereof. The Stock Option Committee may provide that Options must be exercised
  in connection with the closing of such transaction and that if not so exercised
  such Options will expire. Any such determinations by the Stock Option Committee
  may be made generally with respect to all Option Holders, or may be made on
  a case-by-case bases with respect to particular Option Holders. The provisions
  of this Section 5 will not apply to any transaction undertaken for the purpose
  of reincorporating the Company under the laws of another jurisdiction, if such
  transaction does not materially affect the beneficial ownership of the Company’s
  capital stock. Any determination by the Stock Option Committee hereunder shall
  not amend the terms of any Option without the consent of the Option Holder unless,
  in the opinion of the Committee acting reasonably, such amendment is necessary
  to permit the alterations to the Company to be effected and such is in the interest
  of shareholders generally.

SECTION 6
  STOCK OPTIONS
*6.1 Grant of Options*. An Eligible Participant may be granted one or
  more Options. Options granted under the Plan will be Non-Statutory Options.
*6.2 Option Agreements.* Each Option granted under the Plan will be evidenced
  by a written stock option agreement that will be entered into by the Company
  and the Eligible Participant to whom the Option is granted (the “Option
  Holder”), and will be deemed to contain the following terms and conditions,
  unless other terms and conditions inconsistent therewith have been entered into
  the Option agreement. In the event of inconsistency between the provisions of
  the Plan and any Option agreement entered into, the provisions of the Option
  agreement will be considered to have been determined to be exceptional from
  the below and such Option Agreement shall govern where not inconsistent with
  law. However, the provisions of the Plan will govern where the agreement omits
  to provide for a matter governed by the Plan and the agreement will not be incomplete
  nor unenforceable if it fails to provide for a matter provided by the terms
  of this Plan as such shall be incorporated by reference:*(a) Number of Shares.* Each Stock option agreement will state that it
  covers a specified number of Shares, as determined by the Stock Option Committee
  and the agreement. If the agreement fails to state the number then it shall
  be the number set forth in the minutes of the Stock Option Committee.*(b) Price.* The price at which each Share covered by an Option may
  be purchased will be determined by the Stock Option Committee and set forth
  in the Stock Option agreement. Where the price shall be omitted the price shall
  be the Fair Market Value of the Stock on the date set forth at the beginning
  of the Option agreement.*(c) Vesting Period.* Each Stock Option will state the time and the
  amount of the Shares of the Option which vest, and are exercisable thereafter,
  at specified times during the Option Period. Unless otherwise provided in the
  Option agreement, Options will vest and be exercisable for types of Option Holders
  as follows:*Directors and senior officers to Vice-President* - 100% of the
    amount of the Shares under Option upon granting.
    *Employees Generally* - 50% at the end of the later of any probation
    period pursuant to which the Employee is subject to or date of engagement
    and 50% twelve months thereafter.
    *Other Option Holders* - 50% at the end of the first 30 days of
    engagement, 50% upon completion of the term (if term less than twelve months)
    or 50% twelve months after commencement of the contract.*(d) Duration of Options.* Each Stock option agreement will state the
  period of time within which the Option may be exercised by the Option Holder
  (the “Option Period”). The Option Period shall expire not more than
  five years from the date an Option is granted. Unless otherwise stated, director
  and senior officer Options shall be the lesser of five years or the term of
  their office plus 90 days, Employee Options the lesser of five years or the
  term of their employment plus 30 days, and other Option Holders the lesser of
  five years or the term of the engagement agreement plus 30 days.
*(e) Termination of Employment, Death, Disability Etc.* Except as otherwise
  determined by the Stock Option Committee, each Stock Option agreement will provide
  as follows with respect to the exercise of the Option upon termination of the
  employment or the death of the Option Holder:
*(i) Termination.* If the Option Holder’s employment or office
    with the Company is terminated within the Option Period for cause, as determined
    by the Company in its sole discretion, or if the Option Holder resigns without
    appropriate or agreed notice and agreed termination terms, the Option will
    be void for all purposes immediately upon notice of termination or resignation,
    as the case may be, unless otherwise agreed solely at the discretion of the
    Company. Unless specified in an engagement agreement, “cause”
    means a material violation, as determined by the Company, of the Company’s
    established policies and procedures and the terms of engagement and a failure
    to rectify within 15 days of notice. If the Option Holder is terminated for
    another reason, not provided for below or in the engagement agreement or the
    Option agreement, then the Option shall be exercisable, as to the vested portion
    only on the date of termination, for a period of 30 days after termination,
    except as otherwise permitted by the sole discretion of the Stock Option Committee
    but not to exceed the Option Period. The effect of this Section will be limited
    to determining the consequences of a termination and nothing in this Section
    will restrict or otherwise interfere with the Company’s discretion with
    respect to the termination of any Employee.
  *(ii) Death or Disability.* If the Option Holder’s employment
    with the Company is terminated within the Option Period because of the Option
    Holder’s death or disability the Option will remain exercisable, to
    the extent that it was vested and exercisable on the date of the Option Holder’s
    death or disability, for a period of six months after such date; provided,
    however, that in no event may the Option be exercised after the expiration
    of the Option Period.
  *(iii) Non-Employees or non-Office Holders.* For all purposes under
    this Section, an Eligible Participant who is not an Employee or office holder
    of the Company will be considered to have a termination at the conclusion
    of the relevant contract or upon notice by the Company of termination for
    default or breach of agreement. If the contract is terminated for breach or
    default then the Option shall terminate immediately. Otherwise the Option
    shall terminate in accordance with its terms or section 6.2(d) above.

*(f) Transferability of Option.*Each stock option agreement will provide
  that the Option and exercise rights granted therein are not transferable or
  subject to assignment or lien for security purposes by the Option Holder except
  to the Option Holder’s legal representative, his estate, a family corporation
  or personal holding corporation, a bona fide lender or in such other circumstance
  as the Stock Option Committee may approve in its sole discretion, which may
  be exercised contrary without reason. Each assignment of an interest in an Option
  must be approved before such will be enforceable.
*(g) Exercise, Payments, Etc.* Unless otherwise provided by the Stock
  Option agreement the method for exercising the Option granted will be by delivery
  to the office of the Company of written notice specifying the particular Option
  (or portion thereof) that is being exercised and the number of Shares with respect
  to which such Option is exercised, together with payment of the Option Price.
  The exercise of the Option will be deemed effective upon actual receipt of such
  notice and payment to the Company of the Option Price in a form satisfactory
  to the Company, acting reasonably. The purchase of such Stock will take place
  at the principal offices of the Company upon delivery of such notice. A properly
  executed certificate or certificates representing the Stock will be issued by
  the Company and delivered to the Option Holder with reasonable dispatch. Unless
  restricted by the Option agreement, the exercise price shall be paid by any
  of the following methods or any combination of the following methods:
(i) in cash;
  (ii) by cashier’s check, certified cheque, or other acceptable banker’s
    note payable to the order of the Company;
  (iii) by net exercise notice whereby the Option Holder will authorize the
    return to the Plan pool, and deduction from the Option Holder’s Stock
    Option, of sufficient Option Shares whose net value (Fair Value less Option
    exercise price) is sufficient to pay the Option Price of the Shares exercised.
    The Fair Value of the Shares of the Option to be returned to the Plan pool
    as payment will be determined by the closing price of the Company’s
    Shares on the date notice is delivered;
  (iv) by delivery to the Company of a properly executed notice of exercise
    together with irrevocable instructions (referred to in the industry as ‘delivery
    against payment’) to a broker to deliver to the Company promptly the
    amount of the proceeds of the sale of all or a portion of the Stock or of
    a loan from the broker to the Option Holder necessary to pay the exercise
    price; or
  (v) such other method as the Option Holder and the Stock Option Committee
    may determine as adequate including delivery of acceptable securities (including
    securities of the Company), set-off for wages or invoices due, property, or
    other adequate value.

*(h) Date of Grant.*An Option will be considered as having been granted
  on the date specified in the grant resolution of the Stock Option Committee.

*6.3 Stockholder Privileges.*Prior to the exercise of the Option and
  the transfer of Shares to the Option Holder, an Option Holder will have no rights
  as a stockholder with respect to any Shares subject to any Option granted to
  such person under this Plan and, until the Option Holder becomes the holder
  of the record of such Stock, no adjustments, other than those described in Section
  4, will be made for dividends or other distributions or other rights to which
  there is a record date preceding the date such Option Holder becomes the holder
  of record of such Stock.

SECTION 7
  RIGHTS OF EMPLOYEES AND OPTION HOLDERS
*7.1 Employment*. Nothing contained in the Plan or in any Option will
  confer upon any Eligible Participant any right with respect to the continuation
  of employment by the Company, or interfere in any way with the right of the
  Company, subject to the terms of any separate employment agreement to the contrary,
  at any time to terminate such employment or to increase or decrease the compensation
  of such Eligible Participant form the rate in existence at the time of the grant
  of an Option.

SECTION 8
  GENERAL RESTRICTIONS
*8.1 Investment representations*. The Company may require any person to whom
  an Option is granted, as a condition of exercising such Option or receiving
  Stock under the Option, to give written assurances, in substance and form satisfactory
  to the Company and its counsel, to the effect that such person is acquiring
  the Stock subject to the Option for his own account for investment and not with
  any present intention of selling and to such other effects as the Company deems
  necessary or appropriate in order to comply with federal and applicable state
  and provincial securities laws. Legends evidencing such restrictions may be
  placed on the certificates evidencing the Stock.
*8.2 Compliance with Securities Laws.* Each Option will be subject to
  the requirement that if at any time counsel to the Company determines that the
  listing, registration or qualification of the Shares subject to such Option
  upon any securities exchange or under any state, provincial or federal law,
  or the consent or approval of any governmental or regulatory body, is necessary
  as a condition of, or in connection with, the issuance or purchase of Shares
  thereunder, such Option may not be exercised in whole or in part unless such
  listing, registration, qualification, consent or approval will have been effected
  or obtained on conditions acceptable to the Stock Option Committee. Nothing
  herein will be deemed to require the Company to apply for or to obtain such
  listing, registration or qualification. However, where available to the circumstances
  of an Option Holder the Company will include the Option with any other filings
  that the Company elects, at its sole discretion, to file under S-8 or any other
  filings with the SEC but the Company shall not be obliged to make an individual
  filing for a particular Option, unless such shall have been required pursuant
  to the specific Option agreement.

SECTION 9
  OTHER EMPLOYEE BENEFITS
*9.1 Benefits and Taxes.* The amount of any compensation deemed to be
  received by an Option Holder as a result of the exercise of an Option will not
  constitute “earnings” with respect to which any other employee benefits
  of such Option Holder are determined, including, without limitation, benefits
  under any pension, profit sharing, life insurance or salary continuation plan.
  Any taxable consequences of any Option are entirely the responsibility of the
  Option Holder and no contribution shall be required of the Company and, further,
  if the Company should suffer liability for unpaid taxes of an Option Holder
  then the full amount of such shall be a debt of the Option Holder to the Company
  payable immediately and for which the Company may seek judgment and, before
  judgment or process, may set-off against any amounts due to the Option Holder
  or may recover, again before judgment or process, by exercise of any Options
  of the Option Holder on the Option Holder’s behalf, at the discretion
  of the Stock Option Committee.

SECTION 10
  PLAN AMENDMENT, MODIFICATION AND TERMINATION
*10.1 Amendment.* The Board may at any time terminate and, from time
  to time, may amend or modify the Plan provided, however, that no amendment or
  modification may become effective without approval of the amendment or modification
  by the stockholders where stockholder approval is required to enable the Plan
  to satisfy any applicable statutory requirements, or if the Company, on the
  advice of counsel, determines that stockholder approval otherwise is necessary
  or desirable.
No amendment, modification or termination of the Plan will in any manner adversely
  affect any Options theretofore granted under the Plan, without the consent of
  the Option Holders holding such Options.

SECTION 11
  WITHHOLDING
*11.1 Withholding Requirement.* The Company’s obligations to deliver
  Shares upon the exercise of an Option will be subject to the Option Holder’s
  satisfaction of all applicable federal, state and local income and other tax
  withholding requirements and applicable securities requirements.
*11.2 Withholding With Stock.* At the time an Option is granted the Stock
  Option Committee, in its sole discretion, may permit the Option Holder to pay
  all such amounts of tax withholding, or any part thereof, that is due upon exercise
  of the Option by such adjustments as the Stock Option Committee determines,
  including adjustment to a net exercise price or adjustment to the Option Price.

SECTION 12
  BROKERAGE ARRANGEMENTS
*12.1 Brokerage.*The Stock Option Committee, in its discretion, may
  enter into arrangements with one or more banks, brokers or other financial institutions
  to facilitate the disposition of shares acquired upon exercise of Stock Options,
  including, without limitation, arrangements for the simultaneous exercise of
  Stock Options and sale of the Shares acquired upon such exercise.

SECTION 13
  NONEXCLUSIVITY OF THE PLAN
*13.1 Other Plans.* The adoption of this Plan by the Board will not be
  construed as creating any limitations on the power or authority of the Board
  to adopt such other or additional incentive or other compensation arrangements
  of whatever nature as the Board may deem necessary or desirable or preclude
  or limit the continuation of any other plan, practice or arrangement for the
  payment of compensation or fringe benefits to employees generally, or to any
  class or group of employees, or any other persons that the Company or any Affiliated
  Corporation now has lawfully put into effect, including, without limitation,
  any retirement, pension, savings and stock purchase plan, insurance, death and
  disability benefits and executive short-term incentive plans.

SECTION 14
  REQUIREMENTS OF LAW
*14.1 Requirements of Law.* The insurance of Stock and the payment of
  cash pursuant to the Plan will be subject to all applicable laws, rules and
  regulations.
*14.2 Governing Law.* The Plan and all agreements hereunder will be construed
  in accordance with and governed by the laws of the State of Colorado.

SECTION 15
  DURATION OF THE PLAN
*15.1 Termination.* The Plan will terminate at such time as may be determined
  by the Board, and no Option will be granted after such termination. If not sooner
  terminated under the preceding sentence, the Plan will fully cease and expire
  on the earlier of one year from the date that the Plan Limit has been exhausted
  and all Options exercised or expired or January 30, 2013. Options outstanding
  at the time of the Plan termination may continue to be exercised in accordance
  with their terms.

Back to Table of Contents
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

---

|**EXHIBIT 11.1**
			**TRANSAX INTERNATIONAL LIMITED and SUBSIDIARIES**
			(Formerly Vega-Atlantic Corporation)**[A Development Stage Company]
			Statement of Computation of Per Share Earnings**Back to Table of Contents
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                                                                                                                                                                                                                                      | **For the years ended December 31,**
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------
|**2003 (A)**                                                                                                                                                                                                                                          | **2002 (A)**                        
|BASIC:
			Average shares outstanding                                                                                                                                                                                                                  | 12,953,494                          
|Net loss applicable to Common Shares                                                                                                                                                                                                                  | $(3,230,276)                        
|Per share amount                                                                                                                                                                                                                                      | $(0.25)                             
|FULLY DILUTED:
			Average shares outstanding disregarding dilutive outstanding stock options and warrant conversion of debenture for each year                                                                                                        | 12,953,494                          
|Convertible loans                                                                                                                                                                                                                                     | 1,551,272                           
|Dilutive stock options and warrants, based on the treasury stock method using the average market price                                                                                                                                                | 1,273,651                           
|Shares outstanding                                                                                                                                                                                                                                    | 15,778,417                          
|Net loss                                                                                                                                                                                                                                              | $(3,230,276)                        
|Interest on convertible loan                                                                                                                                                                                                                          | $32,818                             
|Net loss for fully diluted calculation                                                                                                                                                                                                                | $(3,197,458)                        
|Per share amount                                                                                                                                                                                                                                      | $(0.20)                             
|Note A:   The fully-diluted calculation is submitted in accordance with Regulation S-K, Item 601 (b)(11), although it is contrary to paragraph 13 of Statement of Financial Accounting Standards No. 128 because it produces an anti-dilutive result.

---

|**EXHIBIT 99.1**
			Back to Table of Contents
|---------------------------------------------

|CERTIFICATION OF CHIEF EXECUTIVE OFFICER
PURSUANT TO SECURITIES EXCHANGE ACT OF 1934 
RULE 13a-14(a) OR 15d-14(a)


I, Stephen Walters, certify that:
I have reviewed this annual report on Form 10-KSB of Transax International Limited ;
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Dated: April 14, 2004 | By:  /s/ Stephen Walters
			---------------------------------
			Stephen Walters , President and CEO
|--------------------- | ----------------------------------------------------------------------------------------------------

---

|**EXHIBIT 99.2**
			Back to Table of Contents
|---------------------------------------------

|CERTIFICATION OF CHIEF FINANCIAL OFFICER
PURSUANT TO SECURITIES EXCHANGE ACT OF 1934 
RULE 13a-14(a) OR 15d-14(a)


I, Nathalie Pilon, certify that:
I have reviewed this annual report on Form 10-KSB of Transax International Ltd.;
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Dated: April 14, 2004 | By:  /s/ Nathalie Pilon
			---------------------------------
			Nathalie Pilon , Chief Financial Officer
|--------------------- | --------------------------------------------------------------------------------------------------------

---

|**EXHIBIT 99.3**
			Back to Table of Contents
|---------------------------------------------

|CERTIFICATIONS PURSUANT TO SECURITIES EXCHANGE ACT OF 1934 
RULE 13a-14(a) OR 15d-14(a) AND
18 U.S.C. SECTION 1350,
AS ADOPTED PURUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002



In connection with the Annual Report of Transax International Ltd. (the "Company") on Form 10-KSB for the period ended December 31, 2003, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), Stephen Walters, President and Chief Executive Officer of the Company, and Nathalie Pilon, Chief Financial Officer of the Company, each certifies for the purpose of complying with Rule 13a-14(b) or Rule 15d-14(b) of the Securities Exchange Act of 1934 (the "Exchange Act") and Section 1350 of Chapter 63 of Title 18 of the United  States Code, that:
the Report fully complies with the requirements of Section 13(a) or 15(d) of the Exchange Act; and
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Dated: April 14, 2004 | By:  /s/ Stephen Walters
			---------------------------------
			Stephen Walters , President and CEO    
|--------------------- | --------------------------------------------------------------------------------------------------------
|Dated: April 14, 2004 | By:  /s/ Nathalie Pilon
			---------------------------------
			Nathalie Pilon , Chief Financial Officer

---