from their latest report (filed in April):
NOTE 11 - SUBSEQUENT EVENTS
On January 17, 2008, the Company issued 245,098 shares of its common stock upon conversion of 100 shares of Series A preferred stock.
On January 24, 2008, the Company issued 1,388,889 shares of its common stock upon conversion of 250 shares of Series A preferred stock.
On March 4, 2008, the Company issued 1,712,121 shares of its common stock upon conversion of 113 shares of Series A preferred stock.
On April 7, 2008, the Company issued 1,795,455 shares of its common stock upon conversion of 79 shares of Series A preferred stock.
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TRANSAX INTERNATIONAL LIMITED AND SUBSIDIARIES
Notes to the Consolidated Financial Statements December 31, 2007 and 2006
NOTE 11 - SUBSEQUENT EVENTS (CONTINUED)
On March 26, 2008, the board of directors of the Company, pursuant to unanimous written consent resolutions, approved the execution of a stock purchase and option agreement (the "Agreement") with Engetech, Inc., a Turks & Caicos corporation controlled and owned 20% by Americo de Castro, director and President of Medlink Conectividade and 80% by Flavio Gonzalez Duarte (the "Buyer"). In accordance with the terms and provisions of the Agreement, the Company sold to the Buyer 45% of the total issued and outstanding stock of its wholly-owned subsidiary, Transax Limited ("Transax Sub"). Transax Sub owns one hundred percent of the total issued and outstanding shares of: (i) Medlink Conectividade and (ii) MTI.
The purchase price for the 45%, or 45 shares, ("Initial Shares") is $3,200,000. Of this amount, $220,000 was to have been paid by December 31, 2007. Of this amount, approximately $188,000 was received by the Company by December 31, 2007 and is reflected as a liability on the accompanying consolidated balance sheet as a deposit on sale of minority interest. The balance is to be paid as follows
i) $32,000 of the initial deposit is due immediately; ii) $480, 000 is to be paid on March 31, 2008, and iii) the balance of $2,400,000 is due in twelve equal monthly payments of $200,000 commencing April 2008. The $2,880,000 balance due and owing by the Buyer is evidenced by an installment note secured by a pledge of all of Initial Shares. As of the date of this report, the Buyer has not paid the March 31, 2008 payment or the remaining initial deposit.
The Buyer has an option to purchase the remaining 55% of Transax Sub. The Option is exercisable by the Buyer during March and April 2009, subject to shareholder approval, to acquire the balance of the Company's Medlink Conectividade operations (and its corresponding debt) by way of acquisition of the remaining 55 shares of the Transax Sub and certain licensing rights for Latin America, Spain and Portugal in exchange for further payments to the Company of approximately $2,400,000 in the form of twelve equal monthly payments of $200,000.
In accordance with the further terms and provisions of the Agreement, a performance bonus shall also be payable by the Buyer to the Company (the "Bonus") equal to 50% of the revenues received by Medlink Conectividade (converted monthly to US Dollars at the monthly average exchange rate as provided by the Central Bank of Brazil) with respect to transactions in excess of an aggregate of 678,076 executed during 2008 for Medlink Conectividade's customer, Brandesco Saude. The Buyer shall pay the Bonus due as follows: 40% of January 31, 2009, 20% on April 30, 2009, 20% on July 31, 2009, and 20% on October 31, 2009. The Bonus shall be payable regardless of whether or not the Buyer elects to exercise the Option.
Additionally, in accordance with the terms and provisions of the Agreement, MTI shall grant to the Company a perpetual, exclusive and sub-license to use all of the software and other intellectual property owned by MTI in all territories other than (i) Latin America (defined as all mainland countries in the Western Hemisphere south of the USA/Mexico border; and (ii) Spain and Portugal.
As of the date of this report, the Buyer is in default by $480,000 of the payment due on March 31, 2008.
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