PROMISSORY NOTE

                                  July 2, 2004

Jersey City, New Jersey                                               $1,000,000

FOR VALUE RECEIVED, the undersigned, NEOMEDIA TECHNOLOGIES INC., a Delaware
corporation (the "Company"), promises to pay CORNELL CAPITAL PARTNERS, LP (the
"Holder") at 101 Hudson Street, Suite 3700, Jersey City, New Jersey 07302 or
other address as the Holder shall specify in writing, the principal sum of One
Million (U.S.) Dollars and 00/100 ($1,000,000) and will be payable pursuant to
the following terms:

1. Amount of Note. The face amount of this Promissory Note (this "Note") and
interest at the rate of twelve percent (12%) per annum shall be payable, which
such interest shall begin to accrue after ninety (90) days from the date hereof,
either out of the net proceeds to be received by the Company under that certain
Standby Equity Distribution Agreement (the "Standby Equity Distribution
Agreement") dated as October 23, 2003 between the Company and the Holder, or the
Company shall pay all amounts due under this Note shall be paid in full within
eighty-seven (87) calendar days of the date hereof, regardless of the
availability of proceeds under the Standby Equity Distribution Agreement unless
an extension is mutually agreed to by the parties in writing. The Company agrees
to escrow five (5) requests for advances under the Standby Equity Distribution
Agreement in an amount not less than Two Hundred Thousand Dollars ($200,000.00),
(individually referred to as "Advance Notice" collectively referred to "Advance
Notices") as well as an appropriate number of shares of the Company's Common
Stock as required under Section 2.2(c) of the Standby Equity Distribution
Agreement (the "Escrowed Shares"). The Escrowed Shares are only an estimation of
the shares of the Company's common stock necessary to repay the principal amount
and interest due hereunder. In the event that during the life of this Note the
Escrowed Shares are insufficient to repay all amounts due hereunder the Company
shall immediately escrow, pursuant to the irrevocable transfer agent
instructions dated the date hereof (the "Irrevocable Transfer Agent
Instructions") such number of shares of the Company's common stock sufficient to
repay all amounts due hereunder. The Advance Notices and the Escrowed Shares
will be held in escrow by the law firm of Butler Gonzalez LLP, which shall
release such requests to the Holder every seven (7) calendar days commencing on
August 23, 2004. The Holder may at its sole discretion retain and apply the net
proceeds of each advance (after deducting any fees owed to the Holder under the
terms of the Standby Equity Distribution Agreement) to the outstanding balance
of this Note as existing from time to time. Interest shall be payable upon the
due date of this Note. If this Note is not paid in full when due, the
outstanding principal owed hereunder shall be due and payable in full together
with interest thereon at the rate of fourteen percent (14%) per annum or the
highest permitted by applicable law, if lower. During the term of this Note the
Company shall have the option to repay the amounts due hereunder in immediately
available funds and withdraw any Advance Notices yet to be effected.

<PAGE>

2. Waiver and Consent. To the fullest extent permitted by law and except as
otherwise provided herein, the Company waives demand, presentment, protest,
notice of dishonor, suit against or joinder of any other person, and all other
requirements necessary to charge or hold the Company liable with respect to this
Note.

3. Costs, Indemnities and Expenses. In the event of default as described herein,
the Company agrees to pay all reasonable fees and costs incurred by the Holder
in collecting or securing or attempting to collect or secure this Note,
including reasonable attorneys' fees and expenses, whether or not involving
litigation, collecting upon any judgments and/or appellate or bankruptcy
proceedings. The Company agrees to pay any documentary stamp taxes, intangible
taxes or other taxes which may now or hereafter apply to this Note or any
payment made in respect of this Note, and the Company agrees to indemnify and
hold the Holder harmless from and against any liability, costs, attorneys' fees,
penalties, interest or expenses relating to any such taxes, as and when the same
may be incurred.

4. Event of Default. Upon an Event of Default (as defined below), the entire
principal balance and accrued interest outstanding under this Note, and all
other obligations of the Company under this Note, shall be immediately due and
payable without any action on the part of the Holder, and the Holder shall be
entitled to seek and institute any and all remedies available to it. No remedy
conferred under this Note upon the Holder is intended to be exclusive of any
other remedy available to the Holder, pursuant to the terms of this Note or
otherwise. No single or partial exercise by the Holder of any right, power or
remedy hereunder shall preclude any other or further exercise thereof. The
failure of the Holder to exercise any right or remedy under this Note or
otherwise, or delay in exercising such right or remedy, shall not operate as a
waiver thereof. An "Event of Default" shall be deemed to have occurred upon the
occurrence of any of the following: (i) the Company should fail for any reason
or for no reason to make payment of the outstanding principal balance plus
accrued interest pursuant to this Note within the time prescribed herein or the
Company fails to satisfy any other obligation or requirement of the Company
under this Note and/or the Irrevocable Transfer Agent Instructions; or (ii) any
proceedings under any bankruptcy laws of the United States of America or under
any insolvency, not disclosed to the Holder, reorganization, receivership,
readjustment of debt, dissolution, liquidation or any similar law or statute of
any jurisdiction now or hereinafter in effect (whether in law or at equity) is
filed by or against the Company or for all or any part of its property.

5. Maximum Interest Rate. In no event shall any agreed to or actual interest
charged, reserved or taken by the Holder as consideration for this Note exceed
the limits imposed by New Jersey law. In the event that the interest provisions
of this Note shall result at any time or for any reason in an effective rate of
interest that exceeds the maximum interest rate permitted by applicable law,
then without further agreement or notice the obligation to be fulfilled shall be
automatically reduced to such limit and all sums received by the Holder in
excess of those lawfully collectible as interest shall be applied against the
principal of this Note immediately upon the Holder's receipt thereof, with the
same force and effect as though the Company had specifically designated such
extra sums to be so applied to principal and the Holder had agreed to accept
such extra payment(s) as a premium-free prepayment or prepayments.


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<PAGE>

6. Cancellation of Note. Upon the repayment by the Company of all of its
obligations hereunder to the Holder, including, without limitation, the face
amount of this Note, plus accrued but unpaid interest, the indebtedness
evidenced hereby shall be deemed canceled and paid in full. Except as otherwise
required by law or by the provisions of this Note, payments received by the
Holder hereunder shall be applied first against expenses and indemnities, next
against interest accrued on this Note, and next in reduction of the outstanding
principal balance of this Note.

7. Severability. If any provision of this Note is, for any reason, invalid or
unenforceable, the remaining provisions of this Note will nevertheless be valid
and enforceable and will remain in full force and effect. Any provision of this
Note that is held invalid or unenforceable by a court of competent jurisdiction
will be deemed modified to the extent necessary to make it valid and enforceable
and as so modified will remain in full force and effect.

8. Amendment and Waiver. This Note may be amended, or any provision of this Note
may be waived, provided that any such amendment or waiver will be binding on a
party hereto only if such amendment or waiver is set forth in a writing executed
by the parties hereto. The waiver by any such party hereto of a breach of any
provision of this Note shall not operate or be construed as a waiver of any
other breach.

9. Successors. Except as otherwise provided herein, this Note shall bind and
inure to the benefit of and be enforceable by the parties hereto and their
permitted successors and assigns.

10. Assignment. This Note shall not be directly or indirectly assignable or
delegable by the Company. The Holder may assign this Note as long as such
assignment complies with the Securities Act of 1933, as amended.

11. No Strict Construction. The language used in this Note will be deemed to be
the language chosen by the parties hereto to express their mutual intent, and no
rule of strict construction will be applied against any party.

12. Further Assurances. Each party hereto will execute all documents and take
such other actions as the other party may reasonably request in order to
consummate the transactions provided for herein and to accomplish the purposes
of this Note.

13. Notices, Consents, etc. Any notices, consents, waivers or other
communications required or permitted to be given under the terms hereof must be
in writing and will be deemed to have been delivered: (i) upon receipt, when
delivered personally; (ii) upon receipt, when sent by facsimile (provided
confirmation of transmission is mechanically or electronically generated and
kept on file by the sending party); or (iii) one (1) trading day after deposit
with a nationally recognized overnight delivery service, in each case properly
addressed to the party to receive the same. The addresses and facsimile numbers
for such communications shall be:


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<PAGE>

If to Company:                          Neomedia Technologies Inc.
                                        2201 2nd Floor - Suite 402
                                        Fort Myers, FL 33901
                                        Attention: Charles T. Jensen
                                        Telephone: (239) 337-3434
                                        Facsimile:

If to the Company:                      Cornell Capital Partners, L.P.
                                        101 Hudson Street, Suite 3700
                                        Jersey City, NJ 07302
                                        Attention: Mark A. Angelo
                                        Telephone: (201) 324-1619
                                        Facsimile: (201) 324-1447

or at such other address and/or facsimile number and/or to the attention of such
other person as the recipient party has specified by written notice given to
each other party three (3) trading days prior to the effectiveness of such
change. Written confirmation of receipt (A) given by the recipient of such
notice, consent, waiver or other communication, (B) mechanically or
electronically generated by the sender's facsimile machine containing the time,
date, recipient facsimile number and an image of the first page of such
transmission or (C) provided by a nationally recognized overnight delivery
service, shall be rebuttable evidence of personal service, receipt by facsimile
or receipt from a nationally recognized overnight delivery service in accordance
with clause (i), (ii) or (iii) above, respectively.

14. Remedies, Other Obligations, Breaches and Injunctive Relief. The Holder's
remedies provided in this Note shall be cumulative and in addition to all other
remedies available to the Holder under this Note, at law or in equity (including
a decree of specific performance and/or other injunctive relief), no remedy of
the Holder contained herein shall be deemed a waiver of compliance with the
provisions giving rise to such remedy and nothing herein shall limit the
Holder's right to pursue actual damages for any failure by the Company to comply
with the terms of this Note. Every right and remedy of the Holder under any
document executed in connection with this transaction may be exercised from time
to time and as often as may be deemed expedient by the Holder. The Company
acknowledges that a breach by it of its obligations hereunder will cause
irreparable harm to the Holder and that the remedy at law for any such breach
may be inadequate. The Company therefore agrees that, in the event of any such
breach or threatened breach, the Holder shall be entitled, in addition to all
other available remedies, to an injunction restraining any breach, and specific
performance without the necessity of showing economic loss and without any bond
or other security being required.


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<PAGE>

15. Governing Law; Jurisdiction. All questions concerning the construction,
validity, enforcement and interpretation of this Agreement shall be governed by
the internal laws of the State of New Jersey, without giving effect to any
choice of law or conflict of law provision or rule (whether of the State of New
Jersey or any other jurisdictions) that would cause the application of the laws
of any jurisdictions other than the State of New Jersey. Each party hereby
irrevocably submits to the exclusive jurisdiction of the Superior Court of the
State of New Jersey sitting in Hudson County, New Jersey and the United States
Federal District Court for the District of New Jersey sitting in Newark, New
Jersey, for the adjudication of any dispute hereunder or in connection herewith
or therewith, or with any transaction contemplated hereby or discussed herein,
and hereby irrevocably waives, and agrees not to assert in any suit, action or
proceeding, any claim that it is not personally subject to the jurisdiction of
any such court, that such suit, action or proceeding is brought in an
inconvenient forum or that the venue of such suit, action or proceeding is
improper. Each party hereby irrevocably waives personal service of process and
consents to process being served in any such suit, action or proceeding by
mailing a copy thereof to such party at the address for such notices to it under
this Agreement and agrees that such service shall constitute good and sufficient
service of process and notice thereof. Nothing contained herein shall be deemed
to limit in any way any right to serve process in any manner permitted by law.

16. No Inconsistent Agreements. None of the parties hereto will hereafter enter
into any agreement, which is inconsistent with the rights granted to the parties
in this Note.

17. Third Parties. Nothing herein expressed or implied is intended or shall be
construed to confer upon or give to any person or entity, other than the parties
to this Note and their respective permitted successor and assigns, any rights or
remedies under or by reason of this Note.

18. Waiver of Jury Trial. AS A MATERIAL INDUCEMENT FOR THE HOLDER TO LOAN TO THE
COMPANY THE MONIES HEREUNDER, THE COMPANY HEREBY WAIVES ANY RIGHT TO TRIAL BY
JURY IN ANY LEGAL PROCEEDING RELATED IN ANY WAY TO THIS AGREEMENT AND/OR ANY AND
ALL OF THE OTHER DOCUMENTS ASSOCIATED WITH THIS TRANSACTION.

19. Entire Agreement. This Note (including the recitals hereto) and the
Irrevocable Transfer Agent Instructions set forth the entire understanding of
the parties with respect to the subject matter hereof, and shall not be modified
or affected by any offer, proposal, statement or representation, oral or
written, made by or for any party in connection with the negotiation of the
terms hereof, and may be modified only by instruments signed by all of the
parties hereto.


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<PAGE>

IN WITNESS WHEREOF, this Note is executed by the undersigned as of the date
hereof.


                                      CORNELL CAPITAL PARTNERS, LP

                                      By: Yorkville Advisors, LLC
                                      Its: General Partner

                                      By: /s/ Mark Angelo
                                          ---------------
                                      Name: Mark Angelo
                                      Its: Portfolio Manager


                                      NEOMEDIA TECHNOLOGIES INC.

                                      By: /s/ Charles T. Jensen
                                          ---------------------
                                      Name: Charles T. Jensen
                                      Title: President & Chief Executive Officer


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