Unassociated Document


     

     

     

     

     

     

     

     

     

    Sale
      and Purchase
      Agreement

    Regarding
      the Sale and Purchase of Shares

     

     

    in

     

     

    12snap
      AG

    Munich,
      Germany

     

    
      
        
        

      

      
        Page
          1

        
          

        

      

      
        
        

      

    

     

     


     

     

     

    
      	
               

              between

               

              1.        
                NeoMedia Technologies, Inc.

              2201
                Second Street, Suite 600

              Ft.
                Myers, Florida33901

              USA

              -
                hereinafter referred to as the "Seller"
                -,

               

            
	
               

            
	
               

              and

               

            
	
               

              2.        
                Mr. Bernd M. Michael

              Am
                Hövel 9

              40667
                Meerbusch

              Germany

               

              -
                hereinafter referred to as the “Purchaser” -,

               

               

            
	
               

              -
                the Seller and Purchaser herein collectively

               referred
                to as the “Parties”, and each of them as a
                “Party”-.

               

            


    

     

    
      
        
        

      

      
        Page
          2

        
          

        

      

      
        
        

      

    


    Table
      of Contents 


    

      

        
          	
                  Table
                    of Contents

                	
                  3

                
	 	 
	
                  Index
                    of Annexes

                	
                  6

                
	 	 
	
                  Recitals

                	 	
                  7

                
	 	 	 
	
                  Section
                    1

                	 	
                  8

                
	 	 	 
	
                  Corporate
                    Ownership; Structure of the Acquisition

                	
                  8

                
	
                  1.1

                	
                   Particulars
                    of the Company

                	
                  8

                
	
                  1.2

                	
                   Registered
                    Share Capital of the Company

                	
                  8

                
	
                  1.3

                	
                   Subsidiaries
                    of the Company

                	
                  9

                
	
                  1.4

                	
                   Participations

                	
                  9

                
	
                  1.5

                	
                   Transfer
                    Price, Profit and Loss Pooling and other Enterprise
                    Agreements

                	
                  9

                
	
                  1.6

                	
                   Cash
                    Pooling Agreements

                	
                  9

                
	
                  1.8

                	
                   Structure
                    of the Acquisition

                	
                  9

                
	
                  Section
                    2

                	 	
                  10

                
	 	 	 
	
                  Sale
                    and Purchase and Transfer of the Transfer Shares; Company
                    Name

                	
                  10

                
	
                  2.1

                	
                   Sale
                    and Purchase and Transfer of the Seller Shares

                	
                  10

                
	
                  2.2

                	
                   Right
                    to Companies’ Names

                	
                  10

                
	
                  Section
                    3

                	 	
                  11

                
	 	 	 
	
                  Closing;
                    Closing Conditions

                	
                  11

                
	
                  3.1

                	
                   Closing;
                    Closing Date

                	
                  11

                
	
                  3.2

                	
                   Closing
                    Conditions

                	
                  11

                
	
                  3.3

                	
                   Waiver
                    of Closing Conditions

                	
                  13

                
	
                  3.4

                	
                   Consequences
                    of Non-Satisfaction of the Closing Conditions

                	
                  14

                
	
                  Section
                    4

                	 	
                  14

                
	 	 	 
	
                  Purchase
                    Price; Conditions of Payment

                	
                  14

                
	
                  4.1

                	
                   Purchase
                    Price

                	
                  14

                
	
                  4.2

                	
                   Payments
                    to Seller

                	
                  15

                
	
                  4.3

                	
                   Payments
                    to Purchaser

                	
                  16

                
	
                  4.4

                	
                   Period
                    and Terms of Escrow

                	
                  16

                
	
                  Section
                    5

                	 	
                  18

                
	 	 	 
	
                  intentionally
                    left free

                	
                  18

                
	 	 
	
                  Section
                    6

                	 	
                  18

                
	 	 
	
                  Seller’s
                    Guaranties

                	
                  18

                
	
                  6.1

                	
                   Title
                    and Authority of Seller and Companies

                	
                  18

                
	
                  6.2

                	
                   Financial
                    Statements

                	
                  20

                
	
                  6.3

                	
                   intentionally
                    left free

                	
                  21

                
	
                  6.4

                	
                   intentionally
                    left free

                	
                  21

                
	
                  6.5

                	
                   intentionally
                    left free

                	
                  21

                
	
                  6.6

                	
                   Customers
                    and Suppliers; Adverse Reaction on Change of Control

                	
                  21

                
	
                  6.7

                	
                   intentionally
                    left free

                	
                  22

                
	
                  6.8

                	
                   intentionally
                    left free

                	
                  22

                
	
                  6.9

                	Taxes
                  and other Public Impositions	
                  22

                


        

         

        
          
            
            

          

          
            Page
              3

            
              

            

          

          
            
            

          

        

         

        
          	
                   

                	
                   

                	
                   

                
	
                  6.10

                	
                  intentionally
                    left free

                	
                  22

                
	
                  6.11

                	
                  Legal
                    Proceedings

                	
                  22

                
	
                  6.12

                	
                  intentionally
                    left free

                	
                  23

                
	
                  6.13

                	
                  intentionally
                    left free

                	
                  23

                
	
                  6.14

                	
                  Conduct
                    of Business

                	
                  23

                
	
                  Section
                    7

                	 	
                  24

                
	 	 	 
	
                  Remedies

                	 	
                  24

                
	
                  7.1

                	
                  Restitution
                    in Kind; Damages

                	
                  24

                
	
                  7.2.

                	
                  Notice
                    of Guaranty Claim

                	
                  25

                
	
                  7.3

                	
                  Exclusion
                    of Guaranty Claims

                	
                  25

                
	
                  7.4

                	
                  Exclusion
                    of further Remedies

                	
                  26

                
	
                  7.5

                	
                  Best
                    Knowledge of the Seller

                	
                  26

                
	
                  Section
                    8

                	 	
                  26

                
	 	 	 
	
                  Defense
                    of Claims; Duty to Inform

                	
                  26

                
	 	 
	
                  Section
                    9

                	 	
                  27

                
	 	 	 
	
                  Tax
                    Indemnity

                	
                  27

                
	
                  9.1

                	
                  Indemnification

                	
                  27

                
	
                  9.2

                	
                  Tax
                    Benefit

                	
                  28

                
	
                  9.3

                	
                  Payment/Duty
                    to Inform

                	
                  28

                
	 	 	 
	
                  Section
                    10

                	 	
                  28

                
	 	 	 
	
                  Limitations
                    of Liabilities

                	
                  28

                
	
                  10.1

                	
                  Time
                    Limits

                	
                  28

                
	
                  10.2

                	
                  De
                    Minimis

                	
                  29

                
	
                  10.3

                	
                  Liability
                    Cap

                	
                  29

                
	 	 	 
	
                  Section
                    11

                	 	
                  30

                
	 	 	 
	
                  Additional
                    Undertakings

                	
                  30

                
	 	 
	
                  Section
                    12

                	 	
                  30

                
	 	 	 
	
                  Non-Solicitation

                	
                  30

                
	 	 
	
                  Section
                    13

                	 	
                  30

                
	 	 	 
	
                  Cooperation
                    Agreement

                	
                  30

                
	 	 
	
                  Section
                    14

                	 	
                  31

                
	 	 	 
	
                  Confidentiality
                    and Press Releases

                	
                  31

                
	
                  14.1

                	
                  Confidentiality
                    in Relation to the Companies

                	
                  31

                
	
                  14.2

                	
                  Confidentiality
                    in Relation to this Agreement and the Parties

                	
                  31

                
	
                  14.3

                	
                  Press
                    Statements

                	
                  31

                
	 	 	 
	
                  Section
                    15 

                	 	
                  32

                


        

        


        
          	
                  Costs
                    and transfer taxes

                	
                  32

                
	
                  15.1

                	
                  Costs
                    of Advisors

                	
                  32

                
	
                  15.2

                	
                  Transfer
                    Taxes

                	
                  32

                


        

         

         

        
          
            
            

          

          
            Page
              4

            
              

            

          

          
            
            

          

        

         

        
          	
                  Section
                    16

                	 	
                  32

                
	 	 	 
	
                  Assignments
                    of Rights and Obligations

                	
                  32

                
	
                  16.1

                	
                  No
                    Assignment without Consent

                	
                  32

                
	 	 	 
	
                  Section
                    17

                	 	
                  32

                
	 	 	 
	
                  INTENTIONALLY
                    LEFT FREE

                	
                  32

                
	 	 
	
                  Section
                    18

                	 	
                  33

                
	 	 	 
	
                  Notices

                	 	
                  33

                
	
                  18.1

                	
                  Form
                    of Notice

                	
                  33

                
	
                  18.2

                	
                  Notices
                    to Seller

                	
                  33

                
	
                  18.3

                	
                  Notices
                    to Purchaser

                	
                  33

                
	
                  18.4

                	
                  Change
                    of Address

                	
                  34

                
	
                  18.5

                	
                  Copies
                    to Advisors

                	
                  34

                
	 	 	 
	
                  Section
                    19

                	 	
                  34

                
	 	 	 
	
                  Miscellaneous

                	
                  34

                
	
                  19.1

                	
                  Governing
                    Law

                	
                  34

                
	
                  19.2

                	
                  Arbitration

                	
                  34

                
	
                  19.3

                	
                  Business
                    Day

                	
                  34

                
	
                  19.4

                	
                  Interest
                    under this Agreement

                	
                  35

                
	
                  19.5

                	
                  Amendments,
                    Supplements, Modifications, Termination

                	
                  35

                
	
                  19.6

                	
                  Headings

                	
                  35

                
	
                  19.7

                	
                  Language

                	
                  35

                
	
                  19.8

                	
                  Annexes

                	
                  35

                
	
                  19.9

                	
                  Entire
                    Agreement

                	
                  35

                
	
                  19.10

                	
                  Severability

                	
                  36

                
	
                  19.11

                	
                  Effectiveness

                	
                  36

                


        

      

    

     

    
      
        
        

      

      
        Page
          5

        
          

        

      

      
        
        

      

    

     

    Index
      of Annexes

     

    Annex
      1.2                         
12snap AG Shares

    Annex
      1.3                         
Subsidiaries

    Annex
      1.5                         
Transfer Price, Profit and Loss Pooling and Enterprise 
 Agreements

    Annex
      3.2.1                      
Draft Stefanie Krebs Waiver Declaration

    Annex
      3.2.2                      
Draft Bernd Michael Waiver Declaration

    Annex
      3.2.4                      
Draft Shareholder Termination Agreement

    Annex
      3.2.12                    
Draft Resignation Letters

    Annex
      3.2.13                    
Draft Company Approval Letter

    Annex
      3.2.15                    
Draft Option Agreement

    Annex
      6                            
Disclosure Letter and Schedules to the Disclosure Letter 

     

    
      
        
        

      

      
        Page
          6

        
          

        

      

      
        
        

      

    

     

    Recitals

     

     

    WHEREAS,
      the Seller holds 2,420,339 registered non-par value shares with a portion of
      the
      share capital of EUR 1.00 each (auf den Namen lautende Stückaktien) of
      12snap AG, a German privately held stock corporation with its legal seat in
      Munich.

    WHEREAS,
      12snap AG is active in the mobile marketing industry.

    WHEREAS,
      the Seller has undertaken a strategic review of its activities and investments
      in 12snap and other mobile marketing companies and has taken the strategic
      decision to divest from the mobile marketing industry. The Seller has already
      disposed on other of its investments in other mobile marketing companies and
      has
      also initiated a good faith process to dispose of its shares in 12snap
      AG.

    WHEREAS,
      the Seller ́s good faith process to dispose of its shares in 12snap AG considers
      any creditor and shareholder protection laws.

    WHEREAS,
      Purchaser is a German private investor.

    WHEREAS,
      the Seller has selected the Purchaser to exclusively negotiate in good faith
      the
      sale and transfer of the Seller ́s shares in 12snap AG. Before granting
      exclusivity to the Purchaser, the Seller had carefully evaluated - not only
      but
      especially based on the criteria of time to money, transaction mechanics and
      retention of a minority stake in 12snap AG similar to other divestments of
      Seller in other mobile marketing companies - and turned down a number of other
      indicative offers or expressed interests of third parties to acquire all or
      parts of the shares of 12snap AG.

    WHEREAS,
      the Seller now wishes to sell part of its shares in 12snap AG to and the
      Purchaser wishes to acquire such shares of the Seller in 12snap AG from the
      Seller whereby the Seller shall have the option to sell its remaining shares
      to
      and the Purchaser shall have the option to buy the remaining shares from the
      Seller under certain terms and conditions as agreed between Seller and
      Purchaser.

    NOW,
      THEREFORE, the Parties hereto agree as follows:

    
      
        
        

      

      
        Page
          7

        
          

        

      

      
        
        

      

    

     

    Section
      1

     

    Corporate
      Ownership; Structure of the
      Acquisition

    1.1      
Particulars
      of
      the Company

     

    12snap
      AG
      (herein referred to as the “Company”) is a stock
      corporation  (Aktiengesellschaft) duly organized under the
      laws of Germany with registered offices at Lazarettstr. 4, 80636 Munich, Germany
      and registered with the Commercial Register of the Lower Court
      (Amtsgericht) at Munich under HRB 127322. 

    1.2      
Registered
      Share Capital of the Company

     

    The
      registered share capital (Grundkapital) of the Company amounts to EUR
      4,917,163 (four million nine hundred seventeen thousand one hundred sixty three
      Euro) (herein referred to as the “Registered Share Capital”).
      The Registered Share Capital is divided into shares which are held by the Seller
      (hereinafter collectively referred to as the "Seller Shares")
      evidenced by global share certificate No. 5 (Namenssammelaktie Nr. 5 über €
2.420.339, hereinafter referred to as the “Global Certificate
      5”), Dr. Michael Birkel (herein referred to as the “Birkel
      Shares”) evidenced by global share certificate No. 3
      (Namenssammelaktie Nr. 3 über € 1.039.572, hereinafter referred to as the
“Global Certificate 3”), Mr. Bernd Mühlfriedel (herein referred
      to as the “Mühlfriedel Shares”) evidenced by global share
      certificate No. 4 (Namenssammelaktie Nr. 4 über € 957.301, hereinafter
      referred to as the “Global Certificate 4”) and the Company
      (herein referred to as the “ CompanyShares”)
      as set forth in Annex 1.2.

    The
      Registered Share Capital has been fully paid and has not been
      repaid.

    The
      Seller Shares shall be divided into 1,928,623 shares which the Seller wishes
      to
      sell to and the Purchaser wishes to acquire from the Seller upon closing of
      this
      agreement (hereinafter referred to as the “Transfer Shares”) to
      be evidenced by global share certificate No. 6 (Namenssammelaktie Nr. 6 über
€ 1.928.623, hereinafter referred to as the “Global Certificate
      6”) and 491,716 shares (hereinafter referred to as the “Option
      Shares”) to be evidenced by global share certificate No. 7
      (Namenssammelaktie Nr. 7 über € 491.716, hereinafter referred to as the
“Global Certificate 7”). With regard to the Option Shares upon
      closing of this agreement Seller and Purchaser will enter into an option
      agreement (the “Option Agreement”) pursuant to which Seller has
      the right to sell and Purchaser has the right to acquire the Option Shares
      under
      the terms and conditions of  the Option Agreement.

    
      
        
        

      

      
        Page
          8

        
          

        

      

      
        
        

      

    


    1.3      
Subsidiaries
      of the Company

     

    Other
      than as set forth in Annex 1.3 hereof, the Company is the sole
      shareholder, directly or indirectly, of the subsidiaries as set forth in
Annex 1.3 (herein referred to as the “Subsidiaries” and
      the shares of the Subsidiaries herein referred to as the “Subsidiaries
      Shares”).

               
      The Company and its Subsidiaries are herein collectively referred to as the
      “Companies”.

    1.4      
      Participations

     

               
      Other than as set forth in section 1.3 hereof, the Company holds, directly
      or
      indirectly, no majority or minority participations in other companies or
      businesses.

    1.5      
Transfer
      Price, Profit and Loss Pooling and other Enterprise
      Agreements

     

    Other
      than as set forth in Annex 1.5 hereof, the Company and the Subsidiaries
      have not entered into any transfer price agreements
      (Verrechnungspreisvereinbarungen), profit and loss pooling agreements
      (Beherrschungs- und Gewinnabführungsverträge) and other enterprise
      agreements (andere Unternehmensverträge iSd § 292 AktG).

    1.6      
Cash
      Pooling
      Agreements

     

    The
      Company and the Subsidiaries have not entered into any cash pooling
      agreements.

    1.8      
Structure
      of
      the Acquisition

     

    TheSeller
      will sell, and the Purchaser will purchase, the Transfer Shares in the Company.
      The Seller shall have the option to sell to the Purchaser and the Purchaser
      shall have the option to purchase from the Seller the Option
      Shares.

    
      
        
        

      

      
        Page
          9

        
          

        

      

      
        
        

      

    

     

    Section
      2

     

    Sale
      and Purchase and Transfer of the Transfer
      Shares; 
 Company Name

     

    2.1      
      Sale and Purchase and Transfer of the Seller
      Shares

     

    2.1.1   
      The Seller hereby sells (verkauft), and the Purchaser hereby purchases
      (kauft), upon the terms and conditions of this Agreement (herein referred
      to as the “Agreement”), the Transfer Shares. The sale and
      purchase of the Transfer Shares hereunder shall include any and all rights
      pertaining to the Transfer Shares, including, without limitation, the right
      to
      receive dividends which have not yet been distributed prior to the date of
      this
      Agreement. The Transfer Shares shall be sold
      together with
      all rights and obligations attaching thereto with economic effect
      (schuldrechtliche Wirkung) as of the closing date.

    2.1.2   
      Subject to the condition precedent (aufschiebende Bedingung) of the
      fulfilment of all closing conditions pursuant to Section 3 below (i) the Seller
      hereby transfers (tritt ab) the Transfer Shares to the Purchaser and (ii)
      the Seller hereby transfers the legal title (übereignen) to the Global
      Certificate 6 to the Purchaser. The Purchaser hereby accepts such transfers.
      The
      Sellers shall hand over (übergeben) the Global Certificate 6 to the
      Purchaser at the closing.

    2.1.3   
      In the event of a rescission (Rücktritt) of this Agreement the transfers
      pursuant to Section 2.1 above shall be null and void (auflösende
      Bedingung) and the Purchaser shall be obliged to hand back the Global
      Certificate 6 to the Seller.

    2.2      
Right
      to
      Companies’ Names

     

    The
      Companies and their successors and assignees shall be
      entitled, but in no way obligated, to operate under the name “12snap” in
      Germany, UK, Italy, Scandinavia, Austria and the US. The Seller and the Seller ́s
      Affiliates (in the meaning of § 15 German Stock Corporation Act) are prohibited
      from using the name “12snap” or confusingly similar names as from the
      closing date for any business in the areas of software, telecom, advertising
      or
      any confusingly similar area. It is understood that this provision does not
      limit the right of the Purchaser, the Companies and their successors to operate
      elsewhere under the name “12snap”.

    
      
        
        

      

      
        Page
          10

        
          

        

      

      
        
        

      

    


    Section
      3

     

    Closing;
      Closing Conditions

     

    3.1      
Closing;
      Closing Date

     

    The
      consummation of the transactions contemplated by this Agreement (herein referred
      to as the “Closing”) shall take place on April 4, 2007, 3 pm
      German Time but not before the Business Day on which the last of the closing
      conditions set forth in section 3.2 has been satisfied, at the offices of
      MLawGroup Partnerschaft von Rechtsanwälten Besner Kreifels, Maximilianstraße 31,
      80539 Munich, Germany, or at such other place and at such other time the Seller
      and the Purchaser will have agreed upon. The date on which the Closing occurs
      shall herein be referred to as the “Closing Date”.


    3.2      
Closing
      Conditions

     

    The
      Closing shall be subject to the satisfaction of each of the following actions
      (herein collectively referred to as the “Closing Conditions”,
      and each of them a “Closing Condition”):

    3.2.1   
Delivery
      to Seller of a waiver
      declaration of Ms. Krebs addressed to Seller not to take recourse against Seller
      and waive any entitlements against Seller arising or in connection to the
      agreement between Seller and Ms. Krebs dated February 2, 2007 (the
“Stefanie Krebs Waiver Declaration”) draft of which is attached
      to this Agreement as Annex
      3.2.1;

    3.2.2   
delivery
      to Seller of a waiver
      declaration of the Purchaser addressed to Seller not to take recourse against
      Seller and waive any entitlements against Seller arising or in connection to
      the
      Purchaser ́s Top-Up Amount (the “Purchaser ́s Top-Up Amout”)
      under Sec. 4.3.3 of the Share Sale and Purchase Agreement among the Seller
      and
      the Purchaser and other parties dated February 10, 2006 (the “Bernd
      Michael Waiver Declaration”) to the extent the Purchaser ́s Top-Up
      Amount has not been set off against the Purchase Price according to this
      Agreement draft of which is attached to this Agreement as Annex
      3.2.2;

    3.2.3   
      delivery to Seller of original share certificate No 1411 of Purchaser
      representing 2,098,481 fully paid and non-assessable shares of the $.01 par
      value common stock of NeoMedia Technologies, Inc. made out to Bernd M. Michael
      and of original share certificate No 1412 of Purchaser representing 427,337
      fully paid and non-assessable shares of the $.01 par value common stock of
      NeoMedia Technologies, Inc. made out to the Purchaser;

    
      
        
        

      

      
        Page
          11

        
          

        

      

      
        
        

      

    


    3.2.4   
delivery
      to Seller of an agreement
      executed by Seller and Dr. Michael Birkel and Bernd Mühlfriedel pursuant to
      which (i) Seller waives any entitlements against Dr. Michael Birkel and Bernd
      Mühlfriedel for a (re)transfer and (re)assignment of the Birkel Shares and the
      Mühlfriedel Shares under the shareholder agreement between the Seller, Dr.
      Michael Birkel and Bernd Mühlfriedel dated February 2, 2007 (the
“Shareholder Agreement”), (ii) in exchange Dr. Michael Birkel
      and Bernd Mühlfriedel waive any entitlements for their outstanding Top-Up
      Amounts under Sec. 4.3.3 of the Share Sale and Purchase Agreement among the
      Seller, Dr. Michael Birkel, Bernd Mühlfriedel and other parties dated February
      10, 2006 and (iii) the Seller, Dr. Michael Birkel and Bernd Mühlfriedel mutually
      terminate the Shareholder Agreement (the “Shareholder Termination
      Agreement”). A draft of the Shareholder Termination Agreement is
      attached to this Agreement as Annex 3.2.4.

    3.2.5   
delivery
      to Seller
      of original share certificate No 1413 of Purchaser representing 2,274,482 fully
      paid and non-assessable shares of the $.01 par value common stock of NeoMedia
      Technologies, Inc. made out to Dr. Michael Birkel and of original share
      certificate No 1414 of Purchaser representing 445,674 fully paid and
      non-assessable shares of the $.01 par value common stock of NeoMedia
      Technologies, Inc. made out to Dr. Michael Birkel;

    3.2.6   
delivery
      to Seller of original share
      certificate No 1424 of Purchaser representing 2,095,036 fully paid and
      non-assessable shares of the $.01 par value common stock of NeoMedia
      Technologies, Inc. made out to Bernd Mühlfriedel and of original share
      certificate No 1425 of Purchaser representing 409,847 fully paid and
      non-assessable shares of the $.01 par value common stock of NeoMedia
      Technologies, Inc. made out to Bernd Mühlfriedel;

    3.2.7   
      delivery to Dr. Michael Birkel Global Certificate 3;

    3.2.8   
      delivery to Bernd Mühlfriedel Global Certificate 4;

    3.2.9   
delivery
      to the Company Global Certificate
      5. The Company will destroy Global Certificate 5 after the Seller has confirmed
      in writing to the Purchaser that the Purchase Price has been fully paid to
      the
      Seller ́s Account and the Escrow Account;

    3.2.10 
delivery
      to the Purchaser Global Certificate 6. The
      Purchaser will hold Global Certificate 6 in escrow for the Seller until the
      Seller has confirmed in writing to the Purchaser that the Purchase Price has
      been fully paid to the Seller ́s Account and the Escrow Account;

    
      
        
        

      

      
        Page
          12

        
          

        

      

      
        
        

      

    


    3.2.11 
      delivery of Global Certificate 7 in trust for the Seller to Freshfields
      Bruckhaus Deringer, att. of Dr. Ferdinand Fromholzer, LL.M., Prannerstr. 10,
      80333 Munich, Germany. 

    3.2.12 
delivery
      to the Company of
      resignation letters by all 3 (three) current supervisory board members (the
      “Resignation Letters”) draft of which are attached to this
      Agreement as Annex 3.2.12;

    3.2.13 
delivery
      to Seller and
      Purchaser of an approval letter of the Company to approve the transfer of the
      Transfer Shares and potential transfer of the Option Shares under the Option
      Agreement to the Purchaser (the “Company Approval Letter”)
      draft of which is attached to this Agreement as Annex 3.2.13;

    3.2.14 
delivery
      to Seller of an irrevocable confirmation of
      Purchaser ́s bank that Purchaser has instructed and Purchaser ́s bank has followed
      Purchaser ́s instruction to pay the cash purchase price to the Seller ́s Account
      and the Escrow Account according to Section 4 of this Agreement;

    3.2.15 
Seller
      and Purchaser deliver to the other party an
      executed version of the share put/call option agreement (the “Option
      Agreement”) pursuant to which (i) Seller has the right to sell to the
      Purchaser and Purchaser has the right to acquire from the Seller the Option
      Shares against a purchase price of USD 750,000 (in words United States Dollars
      seven hundred fifty thousand), (ii) whereby any option right can only be
      exercised on or after December 31, 2007 and (iii) Seller and Purchaser
      understand and agree for the avoidance of doubt that if the Company is sold
      to a
      third party prior to December 31, 2007 Seller will receive the appropriate
      percentage of the proceeds from the third party sale prior to December 31,
      2007.
      A draft of the Option Agreement is attached to this Agreement as Annex
      3.2.15.

    3.3      
Waiver
      of Closing
      Conditions          


     

    The Purchaser shall
      be entitled to waive, by written notice to the Seller, any of the conditions
      precedent set forth above under Section 3.2.7 – 3.2.10 and 3.2.12.

    The Seller shall
      be
      entitled to waive, by written notice to the Purchaser, the conditions precedent
      set forth above under Section 3.2.1 – 3.2.6, 3.2.11 and 3.2.14. 

    
      
        
        

      

      
        Page
          13

        
          

        

      

      
        
        

      

    


    The Parties shall
      be
      entitled to waive, by written notice to the other party, any of the conditions
      precedent set forth above under Section 3.2.13 and 3.2.15.

    3.4      
Consequences
      of
      Non-Satisfaction of the Closing Conditions

     

    3.4.1   
The
      Seller and the Purchaser shall have
      the right to rescind (zurücktreten) this Agreement by written notice by
      the rescinding Party to the other Parties if the Closing Conditions set forth
      above have not been met or waived by the competent Party on or before April
      5,
      2007. 

    3.4.2   
Any
      rescission under this section 3.4
      shall be valid only if the recipient Party has received such written notice
      of
      rescission prior to the date on which the relevant Closing Condition has been
      satisfied or waived. 

    Section
      4

     

    Purchase
      Price; Conditions of Payment

    4.1      
Purchase
      Price

     

    4.1.1   
      The Purchase Price to be paid by the Purchaser for the Transfer Shares as sold
      and purchased hereunder shall be the aggregate of:

    an
      amount of USD 2,600,000 (in words United States Dollars
      two million six hundred thousand)

    (herein referred
      to
      as the "Purchase Price").

    4.1.2   
      The Purchase Price shall be paid in cash at Closing (the “Cash Purchase
      Price”)

    in
      an amount of USD 72,716.76 (in words United States
      Dollars seventy two thousand seven hundred and sixteen)

    to the Seller ́s
      Account (as defined in Section 4.2 hereof),

    in
      an amount of USD 350,676.63 (in words United States
      Dollars three hundred fifty thousand six hundred seventy six)

    which equals for
      the
      purpose of this Agreement EUR 262,561.12 to the account of Technologie
      Beteiligungsfonds Bayern GmbH & Co. KG, Munich, Bank: HypoVereinsbank AG,
      Landshut, Bank Code: 74 320 073, Account: 376 67 56, IBAN:
      DE08743200730003766756, BIC-Code: HYVEDEMM433,

    
      
        
        

      

      
        Page
          14

        
          

        

      

      
        
        

      

    


    in an amount
      of USD 676,606.61 (in words United States Dollars six hundred seventy six
      thousand six hundred and six)

    which
      equals for the purpose of this Agreement EUR 506,593.75 to
      the account of tbg Technologie-Beteiligungs-Gesellschaft mbH, Bonn Bank: KfW
      Bankengruppe Frankfurt, Bank Code: 500 204 00, Account: 122 30 80 949, IBAN:
      DE68500204001223080949, BIC-Code: KFWIDEFFXXX, ref.: DN 732764+5961511 12snap
      AG
      KN 23080949 Tilgung+Mindestvergütung, and

    in
      an amount of USD 500,000 (in words United States Dollars
      five hundred thousand)

    to the Escrow Account
      (as defined in Section 4.4  hereof)(the “Escrow
      Amount”).

    4.1.3   
      The remaining amount of the Purchase Price exceeding the Cash Purchase
      Price

    in
      an amount of  USD 1,000,000 (in words United States
      Dollars one million)

    is
      set off at Closing against the due claim of the Purchaser
      against the Seller for payment of the Purchaser ́s Top-Up Amount arising under
      Sec. 4.3.3 of the Share Sale and Purchase Agreement among the Seller and the
      Purchaser and other parties dated February 10, 2006.

    4.2      
Payments
      to
      Seller

     

    All
      payments unless otherwise provided for herein owed by the
      Purchaser to the Seller under this Agreement shall be paid by the Purchaser
      free
      and clear of costs and charges in immediately available funds by wire transfer
      to the Seller bank account, at

    Account Name:
      NeoMedia Technologies, Inc.

    Account number:
      53301755135

    ABA Routing Number:
      071000013

    Bank Name: JP Morgan
      Chase

    Bank Location:
      Chicago, IL, USA

    (herein referred
      to
      as the "Seller ́s  Account"). 

    
      
        
        

      

      
        Page
          15

        
          

        

      

      
        
        

      

    

     

    4.3      
Payments
      to
      Purchaser

     

    All
      payments owed by the Seller to the Purchaser under this
      Agreement shall be paid by the Seller free and clear of costs and charges in
      immediately available funds by wire transfer to the Purchaser's bank account
      kept with

    Bank: Dresdner Bank
      AG, Düsseldorf

    Account holder: Mr.
      Bernd M. Michael

    Account number: 421
      61 92 00

    IBAN:
      DE94300800000421619200

    Bank zip code: 300
      800 00

    SWIFT: DRESDEFF

    (herein referred
      to
      as the "Purchaser's  Account"). 

    4.4      
Period
      and Terms of
      Escrow

     

    4.4.1   
      Prior to the Closing, MLawGroup Partnerschaft von Rechtsanwälten Besner
      Kreifels, Maximilianstraße 31, 80539 Munich, Germany (the “Escrow
      Agent”) has opened trust account No. 4018107 82 USD at Commerzbank AG,
      Munich, in joint favor of Seller and Purchaser (the “Escrow
      Account”) to receive payment by Purchaser of the Escrow Amount.

    The
      Escrow Amount shall serve as collateral for any claims of
      the Purchaser against the Seller according to the warranties, indemnities and
      covenants under this Agreement.

    Subject
      to sections 4.4.3 to 4.4.5 hereof, the Escrow Amount shall be retained from
      the
      Closing until 90 days after the Closing Date (herein referred to as the
"Escrow Period").

    4.4.2   
      At the end of the Escrow Period (subject to sections 4.4.3 to 4.4.5 hereof)
      the
      Purchaser shall release the escrow amount balance (including interest and after
      reduction of expenses for the Escrow Account and money transfer, the
“Escrow Amount Balance”) to the Seller ́s Account.

    4.4.3   
      The Purchaser shall not be obligated to release the Escrow Amount Balance to
      the
      Seller ́s Account if and to the extent that Purchaser has:

    
      
        
        

      

      
        Page
          16

        
          

        

      

      
        
        

      

    


    (i)        
notified
      the
      Seller in writing and without undue delay of a Guaranty Claim (such notice
      to
      include a statement of the facts upon which the Guaranty Claim is based and
      the
      amount of the Guaranty Claim to the extent that such amount can be determined
      at
      the time when such notice is given) prior to the expiry of the Escrow Period
      

    and

    (ii)       
      commenced arbitration proceedings to pursue such Guaranty Claimwithin four
      weeks
      as of notification to the Seller in accordance with section 4.4.3 (i) hereof.
      

               
      For the avoidance of doubt, the Purchaser's right to not release part or all
      of
      the Escrow Amount pursuant to section 4.4.3 hereof shall be limited to the
      amount notified to the Seller and brought in the arbitration proceedings in
      accordance with section 4.4.3.

    4.4.4   
To
      the extent that any Guaranty Claim
      shall have been agreed by the Parties or determined by an award of the competent
      arbitration tribunal, the Seller shall immediately upon such agreement release
      the amount of such Guaranty Claim from the Escrow Amount to the Purchaser.

    4.4.5   
To
      the extent that the Purchaser has in
      accordance with section 4.4.3 (i) notified the Seller of a Guaranty Claim and
      the Escrow Agent therefore continues to hold all or part of the Escrow Amount,
      the Purchaser shall owe the Seller interest at the rate of 5 % p.a. on the
      amount notified by the Purchaser and held in escrow for the time period starting
      on the day after the day of notification per section 4.4.3 (i) and ending 

    (i)        
if
      the
      Purchaser timely commences arbitration to pursue such Guaranty Claim in
      accordance with section 4.4.3 (ii) upon the conclusion of the arbitration
      procedure. It being understood that interest shall accrue only if and to the
      extent that the Seller prevails in the arbitration proceedings, or

    (ii)       
      the end of the four week filing period per section 4.4.3 (ii) if the Purchaser
      not so commences arbitration.

    
      
        
        

      

      
        Page
          17

        
          

        

      

      
        
        

      

    


    Section
      5

     

    intentionally
      left free

     

     

    Section
      6

     

    Seller’s
      Guaranties

     

    Except
      as specifically set forth in the disclosure letter
      delivered to the Purchaser by the Seller prior to entering into this Agreement
      and attached hereto as Annex 6 (the “Disclosure Letter”)
      and except for the Purchaser’s knowledge, the Seller hereby guarantees to the
      Purchaser subject to the requirements and limitations provided in Section 7
      hereof or otherwise in this Agreement by way of an independent promise of
      guaranty in accordance with section 311 Para. 1 of the German Civil Code
      (Bürgerliches Gesetzbuch) (selbständiges Garantieversprechen
 i.S.d. § 311 Abs. 1 BGB) (herein referred to as the
“Guaranties”) that the statements set forth herein
      are true,
      complete and accurate as of the date of this Agreement and as of the Closing
      Date, it being understood that such statements shall not constitute a quality
      guaranty concerning the object of the purchase within the meaning of sections
      443, 444 of the German Civil Code (Garantie für die Beschaffenheit der
      Sache): 

    6.1      
Title
      and Authority of
      Seller and
      Companies

     

    6.1.1   
      Seller has been duly established and is validly existing under its respective
      jurisdiction. Seller has the unrestricted right, power, authority and capacity
      to execute and consummate this Agreement and the transactions contemplated
      therein. All required approvals of any corporate bodies of Seller have been
      given.

    6.1.2   
Seller
      holds full
      and unrestricted legal and beneficial title (uneingeschränkte rechtliche und
      wirtschaftliche Inhaberschaft) to the Seller Shares. The Seller Shares are
      not pledged (verpfändet), attached (gepfändet), or otherwise
      encumbered (belastet) with any third party rights and are not subject to
      any (i) trust arrangement (Treuhandverhältnis), silent partnership
      (stille Beteiligung) other than those disclosed in Schedule 6.1.2,
      sub-participation (Unterbeteiligung) or similar arrangement; (ii) pending
      transfer or other disposition (Verfügung); (iii) sale, contribution or
      other contractual arrangement creating an obligation to transfer or encumber;
      or
      (iv) shareholders' resolution providing for their redemption
      (Einziehung).

     

    
      
        
        

      

      
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          18

        
          

        

      

      
        
        

      

    


    6.1.3   
      No insolvency or similar proceedings have been, or have been threatened to
      be,
      opened over the assets of Seller, and there are no circumstances that would
      require or justify the opening of or application for such proceedings until
      90
      days after Closing.

    6.1.4   
      This Agreement constitutes and all other documents executed by Seller under
      or
      in connection with this Agreement will, when executed, constitute legal, valid
      and binding obligations of Seller enforceable in accordance with their
      terms.

    6.1.5   
      The execution and consummation of this Agreement and of the transactions
      contemplated herein by Seller does not violate the articles of association,
      partnership agreement or other corporate documents, as the case may be, or
      any
      other legal obligations of Seller and is not subject to challenge
      (Anfechtung) by any third party on any legal basis, including on the
      basis of any creditor protection laws, including but not limited to any
      principle of equal treatment of creditors of Seller according to the federal
      Bankruptcy Code preference statue or laws to avoid fraudulent conveyance or
      fraudulent transfers including but not limited to the Uniform Fraudulent
      Transfer Act and the federal Bankruptcy Code. 

    6.1.6   
      There is no action, suit, investigation or other proceeding pending or
      threatened against or affecting Seller before any court, arbitrator,
      governmental body, agency or official that in any manner challenges or seeks
      to
      prevent, enjoin, alter or materially delay the execution or consummation of
      this
      Agreement or the transactions contemplated therein, and there are no
      circumstances likely to give rise to any of the foregoing.

    6.1.7   
      The Companies are duly organized and validly existing under the laws of their
      respective jurisdictions of incorporation. The statements made in the Recitals
      with respect to the Companies, the Registered Share Capital and the Shares
      are
      true, accurate and complete in every respect. The Companies have the corporate
      power and authority to carry on their respective businesses as they have been
      conducted and will have been conducted up to the Closing Date.

    6.1.8   
      The statements in Section 1.1 through 1.7 are true, complete and accurate in
      every respect. The Seller has made available to Purchaser a complete and correct
      copy of the Company’s and the Subsidiaries’ articles or certificates of
      incorporation and by‐laws, each as amended to date and copies of all
      shareholders resolutions.  The Company’s and the Subsidiaries’ articles or
      certificates of incorporation and by‐laws so delivered are in full force and
      effect.

    
      
        
        

      

      
        Page
          19

        
          

        

      

      
        
        

      

    

     

    6.1.9   
Other
      than under the Agreement listed in
Schedule 6.1.9, no bankruptcy, insolvency or judicial composition
      proceedings have been initiated or applied for under any applicable law against
      the Companies nor have any legal proceedings or other enforcement measures
      been
      initiated or applied for with respect to any property or other assets of any
      of
      the Companies. There exist no circumstances which would require the opening
      of
      such proceedings or justify or require the avoidance of this Agreement in the
      future; in particular, none of the Companies is insolvent
      (zahlungsunfähig), has ceased or suspended payments (Zahlungen
      eingestellt) or is over-indebted (überschuldet) within the meaning of
      the German Insolvency Code or other applicable law such that it would have
      to
      file a petition of bankruptcy (Insolvenzantrag). 

    6.1.10 
      The Seller has made available to Purchaser copies of all contracts between
      the
      Companies and the Seller.

    6.1.11
      No financial and audit related reporting requirements for
      the Company occur if Seller owns less than 20% of the Company ́s registered
      share capital. The Seller records the remaining stake in the Company as an
      investment on Seller ́s balance sheet and analyzes it for impairment on an
      ongoing basis. The Seller will not report any operations of 12snap AG, nor
      will
      the Company fall under the Seller ́s SOX scope or reporting requirements
      under US GAAP. Should there be reporting requirements put on the Company by
      the
      Seller, the Seller will compensate the Company for any related efforts at arm ́s
      lengths prices. It is understood that there will be cut off requirements to
      be
      fulfilled by Seller and Seller will compensate the Company for its efforts
      to
      assist the Seller under such cut off requirements up to a maximum of EUR
      20,000.

    6.2      
Financial
      Statements

     

    6.2.1   
The
      2006 Financial Statements of the
      Companies (Schedule 6.2)(i) have been prepared in accordance with
      generally accepted accounting principles under its respective jurisdictions
      and
      consistently applied with past practice, maintaining the same accounting and
      valuation principles, methods and rules; (ii) present a fair view of the assets
      and liabilities (Vermögenslage), financial condition (Finanzlage)
      and results of operation (Ertragslage) of  the Company for the times
      and for the periods referenced therein, and (iii) cover all liabilities of
      the
      Companies as of their date referenced therein (Bilanzstichtag).

    6.2.2   
Since
      their formation, no dividends have
      been declared or distributed by the Company or the Subsidiaries. The books,
      records and accounts of the Companies (a) have been maintained in accordance
      with ordinary business practices of the Companies, and (b) present a fair view
      of the assets and liabilities (Vermögenslage), financial condition
      (Finanzlage) and results of operation (Ertragslage) of the Company
      for the times and for the periods referenced therein. 

    
      
        
        

      

      
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          20

        
          

        

      

      
        
        

      

    


    6.3      
intentionally
      left
      free

     

    6.4      
intentionally
      left
      free

     

    6.5      
intentionally
      left
      free

     

    6.6      
Customers
      and Suppliers;
      Adverse Reaction on Change of Control

     

    6.6.1   
Other
      than under the Agreement listed in
Schedule 6.6.1, to the best knowledge of the Seller none of the customers
      or suppliers or other contracting parties of the Companies will materially
      reduce the extent of their previous dealings with the Companies as a result
      of
      the consummation of the transactions contemplated hereunder. The Parties agree
      that any such reactions are beyond the control of the Seller and/or the
      Companies and that therefore the Seller ́s and the Companies ́ obligations in this
      regard shall be limited to undertaking reasonable efforts to cooperate in good
      faith with the Purchaser to eliminate or minimize such reactions. The Seller
      and/ or the Companies and the Purchaser shall jointly address any such situation
      as it may arise.

    6.6.2   
Schedule
      6.6.2 contains a true,
      accurate and complete list of the ten major customers of the Company (the
“Major Customers”) and/or its Affiliates. Whether or not a
      customer is considered as a Major Customer shall be determined on the basis
      of
      the turnover achieved by the Company or the Affiliates in respect of the
      respective customer in the calendar year 2006. To the best knowledge of the
      Seller no Material Customer Contract has been terminated or its fee has been
      materially reduced by the customer because of unsatisfactory performance of
      the
      Companies under the Material Customer Contract.

    6.7      
intentionally
      left
      free

     

    6.8      
intentionally
      left
      free

     

    6.9      
Taxes
      and other Public
      Impositions

     

    6.9.1   
The
      Companies have duly prepared and duly
      and timely filed, in accordance with all applicable laws, all tax returns,
      statements, reports and forms required to be filed with respect to any tax
      period (Veranlagungszeitraum) ending prior to or on the Closing Date. All
      information required to be supplied to any Tax Authority has been or will be
      duly and timely supplied. The returns are true and complete and all Taxes due
      and payable on the returns or any tax assessment relating to any tax periods
      ending prior to or on the Closing Date have been timely and fully paid. Other
      than under the Agreement listed in Schedule 6.9.1 there are no
      tax-related audits, actions, proceedings, investigations, claims or assessments
      pending, proposed or threatened against or with respect to any of the Companies.
      None of the Companies has received any tax ruling or entered into any written
      and legally binding agreement or is currently under negotiations to enter into
      any such agreement with any Tax Authority. No waivers of statutes of limitations
      have been given or requested with respect to any Taxes of the Companies.

    
      
        
        

      

      
        Page
          21

        
          

        

      

      
        
        

      

    


    6.9.2   
The
      aforesaid shall apply mutatis
      mutandis to all social security contributions and other public law dues and
      public impositions of any kind (herein collectively referred to as
“Public Impositions”). 

    6.10    
intentionally
      left
      free

     

    6.11    
Legal
      Proceedings

     

    Other
      than under the Agreement listed in Schedule 6.11
      there are no civil, criminal, administrative, judicial or arbitration
      proceedings pending or, to the best of the Seller’s knowledge, threatened to
      which any of the Companies is a party nor are there, to the best of the Seller’s
      knowledge, any facts or circumstances that are likely to result in any civil,
      criminal, administrative, judicial or arbitration proceedings against any of
      the
      Companies (herein referred to as the “Relevant Proceedings”).


    6.12    
intentionally
      left
      free

     

    6.13    
intentionally
      left
      free

     

    6.14    
      Conduct of Business

     

    From
      the beginning of the current fiscal year through the Closing,
      the business operations of the Companies have been and will be conducted in
      the
      ordinary course of business. In particular the Companies have not and will
      not
      have

    6.14.1 
other
      than under the Agreement listed in Schedule
      6.14.1, declared or made any payment of dividends or other distribution to
      shareholders or upon or in respect of any shares of their capital stock, or
      purchased, redeemed or undertaken to purchase or redeem, any of their shares
      of
      their capital stock or other securities;

    
      
        
        

      

      
        Page
          22

        
          

        

      

      
        
        

      

    


    6.14.2 
to
      best knowledge of the Seller mortgaged, pledged or
      subjected to liens, charges, security interests or any other encumbrances or
      restrictions any of their property, business or assets, be they tangible or
      intangible;

    6.14.3 
other
      than under the Agreement listed in Schedule
      6.14.3, to best knowledge of the Seller sold, transferred, agreed to
      transfer, leased to others or otherwise disposed of, acquired or agreed to
      acquire any assets (including, without limitation, equity interests or other
      participations), except for fixed assets and inventory acquired or sold in
      the
      ordinary course of business, or cancelled or settled any debt or claim, or
      waived or released any right of material value;

    6.14.4 
to
      best knowledge of the Seller received any notice
      of termination of any contract, lease or other agreement or suffered any damage,
      destruction or loss (whether or not covered by insurance) which, in any case
      or
      in the aggregate, has had a Material Adverse Effect on the assets, operations
      or
      prospects of any of the Companies;

    6.14.5 
to
      best knowledge of the Seller been subject to or
      threatened by any employee strikes, work stoppages, slow-downs or lockouts,
      or
      had any material change in its relations with its employees;

    6.14.6
      other than under the Agreement listed in Schedule
      6.14.6, to the best knowledge of the Seller transferred or granted any
      rights under, or entered into any settlement regarding the breach or
      infringement of, any of the intellectual property rights or similar rights,
      or
      modified any existing rights with respect thereto;

    6.14.7
      to the best knowledge of the Seller instituted, settled or
      agreed to settle any litigation, action or proceeding before any court,
      arbitration tribunal or governmental body which had a Material Adverse Effect
      on
      the business of the Companies; or

    6.14.8 
to
      the best knowledge of the Seller made any changes
      or amendments of the articles, statutes and by laws of the Company and will
      not
      pass any shareholders ́ resolutions without express written approval of the
      Purchaser.

    6.14.9 
To
      the best knowledge of the Seller all orders
      accepted by customers have been calculated according to the regular calculation
      principles of the company allowing reasonable profits and the cost budgets
      of
      these orders will not be exceeded assuming the absence of unexpected
      circumstances beyond the control of the Companies.

    
      
        
        

      

      
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          23

        
          

        

      

      
        
        

      

    


    6.14.10From
      December 31, 2006 until the execution of this
      Agreement to the best knowledge of the Seller no liability has arisen other
      than
      in the ordinary course of business.

     

    Section
      7

     

    Remedies

     

    7.1      
Restitution
      in Kind;
      Damages

     

    7.1.1   
If
      any of the Guaranties set forth in
      Section 6 hereof is not true, complete and accurate (Guaranty
      Claim) the Seller shall put the Purchaser or the Companies in such
      position as the Purchaser or the Companies would have been had the Guaranties
      given by the Seller been true, complete and accurate (restitution in kind;
      Naturalrestitution). 

    7.1.2   
Should
      the Purchaser be able to show that
      restitution in kind as contemplated in Section 7.1.1 hereof is insufficient
      to
      compensate the Purchaser for losses suffered as a consequence of the breach
      of
      Guaranty, the Purchaser shall have the right (i) to deduct monetary damages
      from
      the Escrow Amount or (ii) to the extent that prior deductions from the Escrow
      Amount in accordance with this Agreement have amounted to or exceeded the Escrow
      Amount to demand that the Seller in the limitations of liabilities as set forth
      in Section 10 below, in addition to providing restitution in kind, pay monetary
      damages (Schadensersatz in Geld) to the Purchaser or to the Companies,
      all of this in such amount as necessary to cover such insufficiency. In case
      of
      Section 7.1.2 (ii), Section 4.4.3 (i) and (ii) shall apply mutatis
      mutandis.

    7.1.3   
Any
      Guaranty Claim of the Purchaser shall
      be limited pro rata the percentage of shares in the Company sold by the Seller
      under this Agreement. This shall not apply for Guaranty Claims of the Purchaser
      arising out of or in connection with Guaranties of the Seller under Sections
      6.1.1 – 6.1.6 and 6.1.11 of this Agreement.

    
      
        
        

      

      
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          24

        
          

        

      

      
        
        

      

    


    7.2.     
Notice
      of Guaranty
      Claim

     

    In the event of a
      Guaranty Claim, the Purchaser without undue delay shall give notice of the
      Guaranty Claim to the Seller in accordance with Section 4.4.3 (i) and
      (ii).

    7.3      
Exclusion
      of Guaranty
      Claims

     

    The Seller shall
      not
      be liable for, and the Purchaser shall not be entitled to bring, any Guaranty
      Claim in connection with this Agreement, if and to the extent that:

    7.3.1   
the
      amount of the Guaranty Claim in
      relation to the incident giving rise to the Guaranty Claim has been recovered
      or
      can be recovered under any insurance policy of any of the Companies which exists
      at Closing or could have been so recovered had Purchaser timely filed a
      respective claim under such insurance policy; or

    7.3.2   
      the Guaranty Claim results from a failure of the Purchaser or the Company to
      mitigate damages pursuant to section 254 of the German Civil Code;


    7.3.3   
      the limitations of liabilities under Section 10 hereof apply;

    7.3.4   
      the substantial facts underlying a Guaranty Claim were known or could have
      been
      known by Purchaser; or

    7.3.5   
      the Companies losses arising out of a breach of a Guaranty have already been
      accounted for in the 2006 Financial Statements.

    7.4      
Exclusion
      of further
      Remedies

     

    The
      Seller and the Purchaser agree that the remedies the Purchaser
      or the Companies may have against the Seller in case of a Guaranty Claim set
      forth in this Agreement are solely governed by this Agreement, and the remedies
      provided for by this Agreement shall be the exclusive remedies available to
      the
      Purchaser or the Companies, provided that the Purchaser shall not be barred
      from
      resorting to other remedies against the Seller if a claim of the Purchaser
      against the Seller is arising as a result of willful or intentional breach
      of
      the Seller ́s obligations under this Agreement. The Seller and the Purchaser
      further agree that under no circumstances shall the Guaranties be construed
      as
      representations of the Seller with respect to the quality of the object of
      the
      purchase within the meaning of section 443 of the German Civil Code
      (Garantie für die Beschaffenheit der Sache) and therefore, the Purchaser
      expressly waives the application of section 444 of the German Civil Code.


    
      
        
        

      

      
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    7.5      
Best
      Knowledge of the
      Seller

     

    For the purposes
      of
      this Agreement, any fact or circumstance shall be deemed to exist to the “best
      knowledge of the Seller” whenever it can be shown that the Seller is consciously
      aware or could have been aware of such fact or circumstance after due inquiry
      with any of Dr. Michael Birkel, Bernd Mühlfriedel and Stefanie Krebs (herein
      referred to collectively as the
“ManagementTeam”). 

     

    Section
      8

     

    Defense
      of Claims; Duty to Inform

     

    8.1      
If
      a claim under Section 7
      hereof arises in connection with any civil, administrative, judicial or
      arbitration proceeding to which any of the Companies or the Purchaser is or
      is
      likely to become a party or the Purchaser otherwise becomes aware that such
      a
      claim is likely to arise the Purchaser shall immediately notify the Seller
      in
      writing of such actual or anticipated proceedings and such claim or potential
      claim, and the following provisions shall apply:

    8.1.1   
The
      Seller has the right - but not the
      obligation - at any time and at its cost to conduct and assume full control
      of
      all or any part of such proceedings or otherwise defend, resist, appeal, settle
      or contest or take any other action which the Seller reasonably considers
      necessary or beneficial – whether in the course of such proceeding or otherwise
      - for the defense against such claim or potential claim. Unless and until the
      Seller assumes conduct by notice in writing to the Purchaser, the Purchaser
      shall have conduct of such proceedings and defense against such claim or
      potential claim. The Seller shall not have the right, however, to enter into
      binding settlement agreements without prior approval in writing of the
      Purchaser.

    8.1.2   
In
      any event the Seller shall keep the
      Purchaser fully informed of and shall allow the Purchaser to comment at any
      time
      on the progress of such proceedings or such defense.

    8.2      
If
      the Purchaser should
      elect to conduct such proceedings and defends himself – from which he is not
      precluded – or the Purchaser refuses to consent to a binding settlement proposed
      by the Seller, the Purchaser ́s failure to allow the Seller to participate in the
      above procedure or to so settle the claim will have the consequence that in
      case
      the Seller can demonstrate that as a result thereof the liability for the Seller
      is higher, Seller will not have to indemnify the Purchaser for such excess
      liability.

    
      
        
        

      

      
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    Section
      9

     

    Tax
      Indemnity

     

    9.1      
      Indemnification

     

    The
      Seller shall indemnify and hold harmless the Purchaser from
      and against (i) any and all Taxes unpaid that are imposed on or will be imposed
      on and payable by the Companies for the period up to and including, or resulting
      from action taken on or prior to, the Closing Date or with respect to any rights
      or obligations of the Companyon the Closing Date, and (ii) any liability arising
      from a breach of any tax Guaranty contained in Section 6 hereof.
      "Tax" or "Taxes" shall mean any taxes,
      charges, duties and levies of any kind including Public Impositions imposed
      by
      any federal, state, local or foreign governmental authority competent for the
      imposition of any such Tax (herein referred to as the "Tax
      Authority") together with any interest and any penalties, additions to
      tax or additional amounts imposed by such Tax Authority with respect to such
      amounts.

    Any claim of the
      Purchaser under this Section 9.1 shall be limited pro rata the percentage of
      shares in the Company sold by the Seller under this Agreement.

    9.2      
Tax
      Benefit

     

    If
      any payment giving rise to a claim for indemnification of Taxes
      under this Agreement actually has resulted in a benefit by refund, set-off
      or
      reduction of Taxes (herein referred to as the
      "TaxBenefit") which would not otherwise have
      arisen then, if and when the liability of the Companies to make an actual
      payment of or in respect of Tax is reduced by reason of that Tax Benefit, and
      after taking account of the effect of all other Tax Benefits that are available
      (including any Tax Benefit derived from a subsequent accounting period), the
      amount by which that liability is so reduced (herein referred to as the
      "Relevant Amount") shall first be set off from any other
      payments which become due in the future on a claim for indemnification or a
      Guarantee Claim or any other claim against Seller under this Agreement. Where
      any determination of a Relevant Amount has been made, the Purchaser or the
      Companies, as the case may be, may request the Companies ́ Auditor to review such
      determination in the light of all relevant circumstances, including any facts
      which have become known only since such determination, and to certify whether
      such determination remains correct or whether, in the light of those
      circumstances, the amount that was the subject of such determination should
      be
      amended.  

    
      
        
        

      

      
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    9.3      
Payment/Duty
      to
      Inform

     

    Section 8 hereof
      shall apply mutatis mutandis.

     

    Section
      10

     

    Limitations
      of Liabilities

     

    10.1    
Time
      Limits

     

    All
      Guaranty-, indemnification-, hold harmless- and similar claims
      arising under this Agreement shall be time-barred either (i) with expiration
      of
      the Escrow Period provided that the Purchaser has not notified the Seller of
      such claims on or prior to the expiration of the Escrow Period or (ii) with
      the
      Purchaser ́s failure to commence arbitration proceedings within the time limit
      provided in Sections 4.4.3 (ii) and 7.1.2, last sentence, above.

    10.2    
De
      Minimis

     

    No
      liability shall arise for the Seller under this Agreement to
      the extent that the aggregate amount of all claims of the Purchaser does not
      exceed EUR 100,000 (in words: Euro one hundred thousand) (herein referred to
      as
      the "De Minimis Claims"). In case the aggregate amount of all
      claims of the Purchaser is greater than EUR 100,000 (in words: Euro one hundred
       thousand) the Seller ́s liability shall be, subject to any further
      limitations under this Agreement, the aggregate amount of all claims including
      the De Minimis Claims. This limitation shall not apply to all claims of the
      Purchaser arising as a result of willful or intentional breaches of the Seller ́s
      obligations under this Agreement or for other matters referred to in Section
      10.3 hereof for which the liability cap is the aggregate purchase price
      paid.

    
      
        
        

      

      
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          28

        
          

        

      

      
        
        

      

    

     

    10.3    
      Liability Cap

     

    10.3.1 
      The aggregate liability of the Seller under this Agreement shall not exceed
      the
      Escrow Amount. 

    10.3.2 
The
      limitation per Section 10.3.1 shall not apply and
      the aggregate liability of the Seller under this Agreement shall be limited
      to
      the sum of the Purchase Price it received hereunder (hereinafter referred to
      as
      the „Purchase Price Liability Cap“), for claims of the
      Purchaser arising as a result of breaches of the Seller ́s representations and
      warranties under Sections 6.1.1 to 6.1.6 of this Agreement.

    10.3.3 
The
      limitations per Section 10.3.1 and 10.3.2 shall
      not apply and the liability of the Seller under this Agreement shall be
      unlimited in case of all claims of the Purchaser arising as a result of willful
      or intentional breaches of the Seller ́s obligations under this Agreement.

               


    Section
      11

     

    Additional
      Undertakings

     

    11.1     Post Closing Corporate
      Actions

     

    Promptly
      after Closing the Purchaser will appoint new members of
      the Supervisory Board of the Company. Under due consideration of the
      independence of the new members of the Supervisory Board, the Purchaser will
      have the new members of the Supervisory Board appoint Dr. Michael Birkel, Bernd
      Mühlfriedel and Stefanie Krebs as member of the Management Board
(Vorstand) of the Company and issue offer letters to Dr. Michael Birkel,
      Bernd Mühlfriedel and Stefanie Krebs.

     

    11.2     Release of Silent
      Partners

     

    Promptly
      after Closing the Parties will use best efforts to obtain
      a written release from Technologie Beteiligungsfonds Bayern GmbH & Co. KG,
      Munich, and from tbg Technologie-Beteiligungs-Gesellschaft mbH, Bonn (jointly
      the „Silent Partners“) pursuant to which the Silent Partners confirm (i) receipt
      of payments to them as set forth under Section 4.1.2 of this Agreement and
      (ii)
      release of all claims of Silent Partners against Seller and the Company.

    
      
        
        

      

      
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          29

        
          

        

      

      
        
        

      

    


    Section
      12

     

    Non-Solicitation

     

    The
      Seller undertakes for a period of two years after the Closing
      not to solicit or entice away from the Company or to offer employment to or
      employ, or to offer or conclude any contract for services with any person who
      was employed by the Company at the Closing Date. 

     

    Section
      13

     

    Cooperation
      Agreement

     

    Seller will and Purchaser
      will use best efforts to have the Company sign a cooperation agreement pursuant
      to which the Company will remain a Seller ́s preferred partner and enjoy most
      favored prices for all of Seller ́s and Seller ́s affiliates products and services
      whereas the Company will perform the development of qode/lavasphere as specified
      and proposed on the 15th December 2006 for free, except for the purchasing
      costs
      for the testphones as specified in Chapter C, Sec. 2 (cost estimate) in such
      specification and proposal of 15th December 2006.

     

    Section
      14

     

    Confidentiality
      and Press Releases

     

    14.1    
Confidentiality
      in Relation to the
      Companies

     

    The
      Seller shall keep strictly confidential all information it has
      in relation to the Companies and their business operations and shall not use
      such confidential information for itself or for any third party except to the
      extent that the relevant facts are publicly known or disclosure is required
      by
      law. 

    14.2    
Confidentiality
      in Relation to this
      Agreement and the Parties

     

    The
      Parties to this Agreement shall keep strictly confidential any
      information obtained by them in connection with the negotiation and conclusion
      of this Agreement with respect to this Agreement, the transactions contemplated
      herein and the respective other Parties and its affiliated entities except
      to
      the extent that the relevant facts are publicly known or disclosure is required
      by law. The Parties shall, however, have the right to submit any information
      to
      any of its affiliated entities or any third party for the purposes of and to
      the
      extent reasonably required for the execution and consummation of this Agreement
      and the transactions contemplated herein. 

    
      
        
        

      

      
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    14.3    
Press
      Statements

     

    Before making any
      press release or similar voluntary announcement with respect to the transactions
      contemplated herein, the Parties and the Company shall (or, in the case of
      public announcements required by applicable law or stock exchange regulations,
      use their best efforts to) reach an agreement on the content of such press
      release or similar voluntary announcement.

     

    Section
      15

     

    Costs
      and transfer taxes

     

    15.1    
Costs
      of
      Advisors

     

    Each Party shall
      bear
      its own costs and expenses in connection with the preparation, execution and
      consummation of this Agreement, including, without limitation, any and all
      professional fees and charges of its advisors. 

    15.2    
Transfer
      Taxes

     

    Any transfer taxes,
      stamp duty and similar taxes or charges resulting from the execution and
      consummation of this Agreement shall be borne by the Purchaser and the Seller
      in
      equal amounts.

     

    Section
      16

     

    Assignments
      of Rights and Obligations

     

    16.1    
No
      Assignment without
      Consent

     

    This Agreement and
      any rights and obligations hereunder cannot be transferred or assigned in whole
      or in part without the prior written consent of the other Parties hereto.

    
      
        
        

      

      
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          31

        
          

        

      

      
        
        

      

    


    Section
      17

     

    INTENTIONALLY
      LEFT FREE

     

    Section
      18

     

    Notices

     

    18.1    
Form
      of
      Notice

     

               
      Any notice or other declaration hereunder shall be in writing
      (including by telefax), unless notarization or any other specific form is
      required, and shall become effective upon receipt by the recipient Party.

    18.2    
Notices
      to
      Seller

     

    Any notice or other
      declaration to be given to the Seller hereunder shall be addressed to the Seller
      as follows:

    NeoMedia
      Technologies, Inc.

    2201
      Second Street, Suite 600

    Ft.Myers,
      Floriada 33901

    USA

    Telefax:
      +1 239 337 36 68

    Copy
      to: Freshfields Bruckhaus Deringer, att. of Dr. Ferdinand Fromholzer, LL.M.,
      Prannerstraße 10, 80333 Munich, Germany, Telefax +49 89 20 70 21 00.

    18.3    
Notices
      to
      Purchaser

     

    Any
      notice or other declaration to be given to the Purchaser hereunder shall be
      addressed as follows: 

    Name:
      Mr. Bernd M. Michael

    Address:
      Am Hövel 9, 40667 Meerbusch, Germany

    Telefax:
      +49 211 38 07 456

    
      
        
        

      

      
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    Copy
      to: MLawGroup Partnerschaft von Rechtsanwälten Besner Kreifels, att. of Rainer
      Kreifels, Maximilianstraße 31, 80539 Munich, Germany, Telefax +49 89 24 213 213.


    18.4    
Change
      of
      Address

     

    The Parties shall
      communicate any change of their respective addresses set forth in Sections
      18.2.
      through 18.3 as soon as possible in writing to the respective other Parties
      and
      their advisors.

    18.5    
Copies
      to
      Advisors

     

               
      The receipt of copies of notices or other declarations hereunder by the Parties’
advisors shall not constitute or substitute the receipt of such notices or
      other
      declarations by the Parties themselves.

     

    Section
      19

     

    Miscellaneous

     

    19.1    
Governing
      Law

     

    This
      Agreement shall be governed by and construed in accordance
      with the laws of Germany, excluding its provisions on conflict of laws and
      the
      United Nations Convention on Contracts for the International Sale of Goods
      (CISG). 

    19.2    
      Arbitration

     

    19.2.1 
Any
      dispute, controversy or claim arising from or in
      connection with this Agreement and its execution shall be finally settled by
      three arbitrators in accordance with the Arbitration Rules of the German
      Institution of Arbitration e.V. (DIS) without recourse to the courts of
      law. The venue of the arbitration shall be Munich, Germany. The language of
      the
      arbitral proceedings shall be English. 

    19.2.2 
In
      the event that mandatory applicable law requires
      any matter arising from or in connection with this Agreement and its execution
      to be decided upon by a court of law, the competent courts in and for Munich
      shall have the jurisdiction thereupon.

    
      
        
        

      

      
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    19.3    
Business
      Day

     

    Herein,
“Business
      Day” means a day (other than a Saturday or Sunday) on
      which banks are open for business in Munich.

    19.4    
Interest
      under this
      Agreement

     

    Except
      as otherwise provided herein, each Party shall pay interest
      on any amounts becoming due and payable to the other Party, as the case may
      be,
      under this Agreement as from the respective due dates until, but not including,
      the day of payment at the rate of   0.25  % p.a.  over the
      basic interest rate (Basiszinssatz) within the meaning of
      section 247 para. 1 of the German Civil Code on the basis of actual days
      elapsed and a 360-day year.

    19.5    
Amendments,
      Supplements,
      Modifications, Termination

     

    Any
      amendment or supplement to or modification or termination of
      this Agreement, including this provision, shall be valid only if made in
      writing, except where a stricter form (e.g. notarization) is required under
      applicable law.

    19.6    
Headings

     

    The
      headings and sub-headings of the sections contained herein are
      for convenience and reference purposes only and shall not affect the meaning
      or
      construction of any of the provisions hereof.

    19.7    
Language

     

    This
      Agreement is written in the English language (except that
      Annexes may be in the German language). Terms to which a German translation
      has
      been added shall be interpreted throughout this Agreement in the meaning
      assigned to them by the German translation. 

    19.8    
Annexes

     

    All Annexes attached
      hereto form an integral part of this Agreement.

    19.9    
Entire
      Agreement

     

    This
      Agreement constitutes the entire agreement among and between
      the Parties with respect to the subject matter hereof and shall substitute
      and
      supersede any negotiations, agreements and understandings, oral or
      written,  heretofore made between the Parties with respect to the subject
      matter hereof. Side agreements to this Agreement do not exist.

    
      
        
        

      

      
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    19.10  
Severability

     

    Should
      any provision of this Agreement be or become invalid,
      ineffective or unenforceable as a whole or in part, the validity, effectiveness
      and enforceability of the remaining provisions shall not be affected thereby.
      Any such invalid, ineffective or unenforceable provision shall, to the extent
      permitted by law, be deemed replaced by such valid, effective and enforceable
      provision as comes closest to the economic intent and purpose of such invalid,
      ineffective or unenforceable provision. The aforesaid shall apply mutatis
      mutandis to any gap in this Agreement.

    19.11  
      Effectiveness

     

    This
      Agreement shall be countersigned in two (2) originals and
      shall be binding upon all parties having signed this Agreement irrespective
      of
      whether the respective party has received an original hereof. The parties agree
      that exchange of signatures by fax to the other party is sufficient.

    In
      witness whereof, the Parties hereto have caused this Agreement to be executed
      by
      their duly authorized representatives, all as of this April 4, 2007, in
 Munich.

    
      	Seller:  	 	 	Purchaser:
	 	 	 	 
	/s/ George
              O ́Leary   	 	 	/s/ Bernd
              M. Michael
	
              

              NeoMedia Technologies, Inc.	 	 	
              

              Mr. Bernd M. Michael
	Mr. George O ́Leary	 	 	 


    

                                                                       


    
      
        
        

      

      
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