Document:

Exhibit 10.3

 

WARRANT

 

THE SECURITIES REPRESENTED BY THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS.  THE SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS, OR AN OPINION OF COUNSEL IN A FORM REASONABLY SATISFACTORY TO THE ISSUER THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR APPLICABLE STATE SECURITIES LAWS OR UNLESS SOLD PURSUANT TO RULE 144 UNDER SAID ACT.

 

NEOMEDIA TECHNOLOGIES, INC.

 

Warrant To Purchase Common Stock

 

	
Warrant No.: NEOM-0411

	
Number of Shares:

	
1,000,000

	  	
Warrant Exercise Price:

	
$0.10

	  	
Expiration Date:

	
April 13, 2016

Date of Issuance: April 13, 2011

NeoMedia Technologies, Inc., a Delaware corporation (the “Company”), hereby certifies that, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, YA Global Investments, L.P.(“YA Global”), the registered holder hereof or any permitted assigns (each a “Holder” and collectively, the “Holders”), is entitled, subject to the terms set forth below, to purchase from the Company upon surrender of this Warrant, at any time or times on or after the date hereof, but not after 11:59 P.M. Eastern Time on the Expiration Date (as defined herein) up to 1,000,000 fully paid and nonassessable shares of Common Stock (as defined herein) of the Company (the “Warrant Shares”) at the exercise price per share provided in Section 1(b) below or as subsequently adjusted; provided, however, that in no event shall the Holder be entitled to exercise this Warrant for a number of Warrant Shares in excess of that number of Warrant Shares which, upon giving effect to such exercise, would cause the aggregate number of shares of Common Stock beneficially owned by the Holder and its affiliates to exceed 9.99% of the outstanding shares of the Common Stock following such exercise (however, such restriction may be waived by Holder (but only as to itself and not to any other Holder) upon not less than 65 days prior notice to the Company).  For purposes of the foregoing proviso, the aggregate number of shares of Common Stock beneficially owned by the Holder and its affiliates shall include the number of shares of Common Stock issuable upon exercise of this Warrant with respect to which the determination of such proviso is being made, but shall exclude shares of Common Stock which would be issuable upon (i) exercise of the remaining, unexercised Warrants beneficially owned by the Holder and its affiliates and (ii) exercise or conversion of the unexercised or unconverted portion of any other securities of the Company beneficially owned by the Holder and its affiliates (including, without limitation, any convertible notes or preferred stock) subject to a limitation on conversion or exercise analogous to the limitation contained herein.  Except as set forth in the preceding sentence, for purposes of this paragraph, beneficial ownership shall be calculated in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended.  For purposes of this Warrant, in determining the number of outstanding shares of Common Stock a Holder may rely on the number of outstanding shares of Common Stock as reflected in (1) the Company’s most recent Form 10-Q or Form 10-K, as the case may be, (2) a more recent public announcement by the Company or (3) any other notice by the Company or its transfer agent setting forth the number of shares of Common Stock outstanding.  Upon the written request of any Holder, the Company shall promptly, but in no event later than one (1) Business Day following the receipt of such notice, confirm in writing to any such Holder the number of shares of Common Stock then outstanding. In any case, the number of outstanding shares of Common Stock shall be determined after giving effect to the exercise of Warrants (as defined below) by such Holder and its affiliates since the date as of which such number of outstanding shares of Common Stock was reported.

  

  

  

 

Section 1.

 

(a)          This Warrant is issued pursuant to the Agreement (“SPA Agreement”) dated April 13, 2011 between the Company and YA Global or issued in exchange or substitution thereafter or replacement thereof.  Each Capitalized term used, and not otherwise defined herein, shall have the meaning ascribed thereto in the Securities Purchase Agreement.

 

(b)          Definitions.  The following words and terms as used in this Warrant shall have the following meanings:

 

(i)           “Approved Stock Plan” means a stock option plan that has been approved by the Board of Directors of the Company prior to the date of the Securities Purchase Agreement, pursuant to which the Company’s securities may be issued only to any employee, officer or director for services provided to the Company.

 

(ii)          “Business Day” means any day other than Saturday, Sunday or other day on which commercial banks in the City of New York are authorized or required by law to remain closed.

 

(iii)         “Closing Bid Price” means the closing bid price of Common Stock as quoted on the Principal Market (as reported by Bloomberg Financial Markets (“Bloomberg”) through its “Volume at Price” function).

 

(iv)         “Common Stock” means (i) the Company’s common stock, par value $0.001 per share, and (ii) any capital stock into which such Common Stock shall have been changed or any capital stock resulting from a reclassification of such Common Stock.

 

(v)          “Excluded Securities” means, (a) shares issued or deemed to have been issued by the Company pursuant to an Approved Stock Plan, (b) shares of Common Stock issued or deemed to be issued by the Company upon the conversion, exchange or exercise of any right, option, obligation or security outstanding on the date prior to date of the Securities Purchase Agreement, provided that the terms of such right, option, obligation or security are not amended or otherwise modified on or after the date of the Securities Purchase Agreement, and provided that the conversion price, exchange price, exercise price or other purchase price is not reduced, adjusted or otherwise modified and the number of shares of Common Stock issued or issuable is not increased (whether by operation of, or in accordance with, the relevant governing documents or otherwise) on or after the date of the Securities Purchase Agreement,  and (c) the shares of Common Stock issued or deemed to be issued by the Company upon conversion of the Convertible Debentures or exercise of the Warrants.

 

(vi)         “Expiration Date” means the date written on the first page of this Warrant.

 

(vii)        “Issuance Date” means the date hereof.

 

(viii)       “Options” means any rights, warrants or options to subscribe for or purchase Common Stock or Convertible Securities.

 

(ix)         “Person” means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization and a government or any department or agency thereof.

 

(x)          “Primary Market” means on any of (a) the American Stock Exchange, (b) New York Stock Exchange, (c) the Nasdaq Global Select Market, (d) the Nasdaq Global Market, (e) the Nasdaq Capital Market, or (e) the Over-the-Counter Bulletin Board (“OTCBB”)

  

  

  

(xi)         “Securities Act” means the Securities Act of 1933, as amended.

 

(xii)        “Warrant” means this Warrant and all Warrants issued in exchange, transfer or replacement thereof.

 

(xiii)       “Warrant Exercise Price” shall be $0.10 or as subsequently adjusted as provided in Section 8 hereof.

 

(c)          Other Definitional Provisions.

 

(i)           Except as otherwise specified herein, all references herein (A) to the Company shall be deemed to include the Company’s successors and (B) to any applicable law defined or referred to herein shall be deemed references to such applicable law as the same may have been or may be amended or supplemented from time to time.

 

(ii)          When used in this Warrant, the words “herein”, “hereof”, and “hereunder” and words of similar import, shall refer to this Warrant as a whole and not to any provision of this Warrant, and the words “Section”, “Schedule”, and “Exhibit” shall refer to Sections of, and Schedules and Exhibits to, this Warrant unless otherwise specified.

 

(iii)         Whenever the context so requires, the neuter gender includes the masculine or feminine, and the singular number includes the plural, and vice versa.

 

Section 2.             Exercise of Warrant.

 

(a)           Subject to the terms and conditions hereof, this Warrant may be exercised by the Holder hereof then registered on the books of the Company, pro rata as hereinafter provided, at any time on any Business Day on or after the opening of business on such Business Day, commencing with the first day after the date hereof, and prior to 11:59 P.M. Eastern Time on the Expiration Date (i) by delivery of a written notice, in the form of the subscription notice attached as Exhibit A hereto (the “Exercise Notice”), of such Holder’s election to exercise this Warrant, which notice shall specify the number of Warrant Shares to be purchased, payment to the Company of an amount equal to the Warrant Exercise Price(s) applicable to the Warrant Shares being purchased, multiplied by the number of Warrant Shares (at the applicable Warrant Exercise Price) as to which this Warrant is being exercised (plus any applicable issue or transfer taxes) (the “Aggregate Exercise Price”) in cash or wire transfer of immediately available funds and the surrender of this Warrant (or an indemnification undertaking with respect to this Warrant in the case of its loss, theft or destruction) to a common carrier for overnight delivery to the Company as soon as practicable following such date (“Cash Basis”) or (ii) if at the time of exercise, the Warrant Shares are not subject to an effective registration statement, by delivering an Exercise Notice and in lieu of making payment of the Aggregate Exercise Price in cash or wire transfer, elect instead to receive upon such exercise the “Net Number” of shares of Common Stock determined according to the following formula (the “Cashless Exercise”):

 

Net Number = (A x B) – (A x C)

                                      B

For purposes of the foregoing formula:

A = the total number of Warrant Shares with respect to which this Warrant is then being exercised.

B = the Closing Bid Price of the Common Stock on the date of exercise of the Warrant.

C = the Warrant Exercise Price then in effect for the applicable Warrant Shares at the time of such exercise.

  

  

  

In the event of any exercise of the rights represented by this Warrant in compliance with this Section 2, the Company shall on or before the fifth Business Day following the date of receipt of the Exercise Notice, the Aggregate Exercise Price and this Warrant (or an indemnification undertaking with respect to this Warrant in the case of its loss, theft or destruction) and the receipt of the representations of the Holder specified in Section 6 hereof, if requested by the Company (the “Exercise Delivery Documents”), and if the Common Stock is DTC eligible, credit such aggregate number of shares of Common Stock to which the Holder shall be entitled to the Holder’s or its designee’s balance account with The Depository Trust Company; provided, however, if the Holder who submitted the Exercise Notice requested physical delivery of any or all of the Warrant Shares, or, if the Common Stock is not DTC eligible  then the Company shall, on or before the fifth Business Day following receipt of the Exercise Delivery Documents, issue and surrender to a common carrier for overnight delivery to the address specified in the Exercise Notice, a certificate, registered in the name of the Holder, for the number of shares of Common Stock to which the Holder shall be entitled pursuant to such request.  Upon delivery of the Exercise Notice and Aggregate Exercise Price referred to in clause (i) or (ii) above the Holder of this Warrant shall be deemed for all corporate purposes to have become the holder of record of the Warrant Shares with respect to which this Warrant has been exercised.  In the case of a dispute as to the determination of the Warrant Exercise Price, the Closing Bid Price or the arithmetic calculation of the Warrant Shares, the Company shall promptly issue to the Holder the number of Warrant Shares that is not disputed and shall submit the disputed determinations or arithmetic calculations to the Holder via facsimile within one (1) Business Day of receipt of the Holder’s Exercise Notice.

 

(b)           If the Holder and the Company are unable to agree upon the determination of the Warrant Exercise Price or arithmetic calculation of the Warrant Shares within one day of such disputed determination or arithmetic calculation being submitted to the Holder, then the Company shall immediately submit via facsimile (i) the disputed determination of the Warrant Exercise Price or the Closing Bid Price to an independent, reputable investment banking firm or (ii) the disputed arithmetic calculation of the Warrant Shares to its independent, outside accountant.  The Company shall cause the investment banking firm or the accountant, as the case may be, to perform the determinations or calculations and notify the Company and the Holder of the results no later than forty-eight hours from the time it receives the disputed determinations or calculations.  Such investment banking firm’s or accountant’s determination or calculation, as the case may be, shall be deemed conclusive absent manifest error.

 

(c)           Unless the rights represented by this Warrant shall have expired or shall have been fully exercised, the Company shall, as soon as practicable and in no event later than five (5) Business Days after any exercise and at its own expense, issue a new Warrant identical in all respects to this Warrant exercised except it shall represent rights to purchase the number of Warrant Shares purchasable immediately prior to such exercise under this Warrant exercised, less the number of Warrant Shares with respect to which such Warrant is exercised.

 

(d)           No fractional Warrant Shares are to be issued upon any pro rata exercise of this Warrant, but rather the number of Warrant Shares issued upon such exercise of this Warrant shall be rounded up or down to the nearest whole number.

 

(e)           If the Company or its Transfer Agent shall fail for any reason or for no reason to issue to the Holder within ten (10) days of receipt of the Exercise Delivery Documents, a certificate for the number of Warrant Shares to which the Holder is entitled or to credit the Holder’s balance account with The Depository Trust Company for such number of Warrant Shares to which the Holder is entitled upon the Holder’s exercise of this Warrant, the Company shall, in addition to any other remedies under this Warrant or otherwise available to such Holder, pay as additional damages in cash to such Holder on each day the issuance of such certificate for Warrant Shares is not timely effected an amount equal to 0.025% of the product of (A) the sum of the number of Warrant Shares not issued to the Holder on a timely basis and to which the Holder is entitled, and (B) the Closing Bid Price of the Common Stock for the trading day immediately preceding the last possible date which the Company could have issued such Common Stock to the Holder without violating this Section 2.

 

(f)           If within ten (10) days after the Company’s receipt of the Exercise Delivery Documents, the Company fails to deliver a new Warrant to the Holder for the number of Warrant Shares to which such Holder is entitled pursuant to Section 2 hereof, then, in addition to any other available remedies under this Warrant, or otherwise available to such Holder, the Company shall pay as additional damages in cash to such Holder on each day after such tenth (10th) day that such delivery of such new Warrant is not timely effected in an amount equal to 0.25% of the product of (A) the number of Warrant Shares represented by the portion of this Warrant which is not being exercised and (B) the Closing Bid Price of the Common Stock for the trading day immediately preceding the last possible date which the Company could have issued such Warrant to the Holder without violating this Section 2.

  

  

  

 

Section 3.             Covenants as to Common Stock.  The Company hereby covenants and agrees as follows:

 

(a)           This Warrant is, and any Warrants issued in substitution for or replacement of this Warrant will upon issuance be, duly authorized and validly issued.

 

(b)           All Warrant Shares which may be issued upon the exercise of the rights represented by this Warrant will, upon issuance, be validly issued, fully paid and nonassessable and free from all taxes, liens and charges with respect to the issue thereof.

 

(c)           If at any time during the period within which the rights represented by this Warrant may be exercised the Company does not have a sufficient number of shares of Common Stock authorized and available to provide for the exercise in full of the rights represented by this Warrant, or if the par value of such shares is less than or equal to the applicable Warrant Exercise Price, then upon written notice from two Fifths of the Holders, the Company shall call and hold a special meeting of its stockholders within sixty  (60) days of such notice for the purpose of increasing the number of authorized shares of Common Stock and/or reducing the par value of the Common Stock.

 

(d)           If at any time after the date hereof the Company shall file a registration statement, the Company shall include the Warrant Shares issuable to the Holder, pursuant to the terms of this Warrant and shall maintain, so long as any other shares of Common Stock shall be so listed, such listing of all Warrant Shares from time to time issuable upon the exercise of this Warrant; and the Company shall so list on each national securities exchange or automated quotation system, as the case may be, and shall maintain such listing of, any other shares of capital stock of the Company issuable upon the exercise of this Warrant if and so long as any shares of the same class shall be listed on such national securities exchange or automated quotation system.

 

(e)           The Company will not, by amendment of its Articles of Incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities, or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms to be observed or performed by it hereunder, but will at all times in good faith assist in the carrying out of all the provisions of this Warrant and in the taking of all such action as may reasonably be requested by the Holder in order to protect the exercise privilege of the Holder against dilution or other impairment, consistent with the tenor and purpose of this Warrant.  The Company will not increase the par value of any shares of Common Stock receivable upon the exercise of this Warrant above the Warrant Exercise Price then in effect, and (ii) will take all such actions as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and nonassessable shares of Common Stock upon the exercise of this Warrant.

 

(f)           This Warrant will be binding upon any entity succeeding to the Company by merger, consolidation or acquisition of all or substantially all of the Company’s assets.

 

Section 4.             Taxes.  The Company shall pay any and all taxes, except any applicable withholding, which may be payable with respect to the issuance and delivery of Warrant Shares upon exercise of this Warrant.

 

Section 5.             Warrant Holder Not Deemed a Stockholder.  Except as otherwise specifically provided herein, no Holder, as such, shall be entitled to vote or receive dividends or be deemed the holder of shares of capital stock of the Company for any purpose, nor shall anything contained in this Warrant be construed to confer upon the Holder, as such, any of the rights of a stockholder of the Company or any right to vote, give or withhold consent to any corporate action (whether any reorganization, issue of stock, reclassification of stock, consolidation, merger, conveyance or otherwise), receive notice of meetings, receive dividends or subscription rights, or otherwise, prior to the issuance to the holder of this Warrant of the Warrant Shares which he or she is then entitled to receive upon the due exercise of this Warrant.  In addition, nothing contained in this Warrant shall be construed as imposing any liabilities on such holder to purchase any securities (upon exercise of this Warrant or otherwise) or as a stockholder of the Company, whether such liabilities are asserted by the Company or by creditors of the Company.  Notwithstanding this Section 5, the Company will provide the holder of this Warrant with copies of the same notices and other information given to the stockholders of the Company generally, contemporaneously with the giving thereof to the stockholders.

  

  

  

Section 6.             Representations of Holder.  The Holder, by the acceptance hereof, represents that it is acquiring this Warrant and the Warrant Shares for its own account for investment only and not with a view towards, or for resale in connection with, the public sale or distribution of this Warrant or the Warrant Shares, except pursuant to sales registered or exempted under the Securities Act; provided, however, that by making the representations herein, the Holder does not agree to hold this Warrant or any of the Warrant Shares for any minimum or other specific term and reserves the right to dispose of this Warrant and the Warrant Shares at any time in accordance with or pursuant to a registration statement or an exemption under the Securities Act.  The Holder further represents, by acceptance hereof, that, as of this date, such holder is an “accredited investor” as such term is defined in Rule 501(a)(1) of Regulation D promulgated by the Securities and Exchange Commission under the Securities Act (an “Accredited Investor”).  Upon exercise of this Warrant the Holder shall, if requested by the Company, confirm in writing, in a form satisfactory to the Company, that the Warrant Shares so purchased are being acquired solely for the Holder’s own account and not as a nominee for any other party, for investment, and not with a view toward distribution or resale and that the Holder is an Accredited Investor.  If the Holder cannot make such representations because they would be factually incorrect, it shall be a condition to the Holder’s exercise of this Warrant that the Company receive such other representations as the Company considers reasonably necessary to assure the Company that the issuance of its securities upon exercise of this Warrant shall not violate any United States or state securities laws.

 

Section 7.             Ownership and Transfer.

 

(a)           The Company shall maintain at its principal executive offices (or such other office or agency of the Company as it may designate by notice to the holder hereof), a register for this Warrant, in which the Company shall record the name and address of the person in whose name this Warrant has been issued, as well as the name and address of each transferee.  The Company may treat the person in whose name any Warrant is registered on the register as the owner and holder thereof for all purposes, notwithstanding any notice to the contrary, but in all events recognizing any transfers made in accordance with the terms of this Warrant.

 

Section 8.             Adjustment of Warrant Exercise Price and Number of Shares.  The Warrant Exercise Price and the number of shares of Common Stock issuable upon exercise of this Warrant shall be adjusted from time to time as follows:

 

(a)          Adjustment of Warrant Exercise Price and Number of Shares upon Issuance of Common Stock.  If and whenever on or after the Issuance Date of this Warrant, the Company issues or sells, or is deemed to have issued or sold, any shares of Common Stock (other than Excluded Securities) for a consideration per share less than a price (the “Applicable Price”) equal to the Warrant Exercise Price in effect immediately prior to such issuance or sale, then immediately after such issue or sale the Warrant Exercise Price then in effect shall be reduced to an amount equal to such consideration per share.  Upon each such adjustment of the Warrant Exercise Price hereunder, the number of Warrant Shares issuable upon exercise of this Warrant shall be adjusted to the number of shares determined by multiplying the Warrant Exercise Price in effect immediately prior to such adjustment by the number of Warrant Shares issuable upon exercise of this Warrant immediately prior to such adjustment and dividing the product thereof by the Warrant Exercise Price resulting from such adjustment.

 

(b)          Effect on Warrant Exercise Price of Certain Events.  For purposes of determining the adjusted Warrant Exercise Price under Section 8(a) above, the following shall be applicable:

 

(i)           Issuance of Options.  If after the date hereof, the Company in any manner grants any Options and the lowest price per share for which one share of Common Stock is issuable upon the exercise of any such Option or upon conversion or exchange of any convertible securities issuable upon exercise of any such Option is less than the Applicable Price, then such share of Common Stock shall be deemed to be outstanding and to have been issued and sold by the Company at the time of the granting or sale of such Option for such price per share.  For purposes of this Section 8(b)(i), the lowest price per share for which one share of Common Stock is issuable upon exercise of such Options or upon conversion or exchange of such Convertible Securities shall be equal to the sum of the lowest amounts of consideration (if any) received or receivable by the Company with respect to any one share of Common Stock upon the granting or sale of the Option, upon exercise of the Option or upon conversion or exchange of any convertible security issuable upon exercise of such Option.  No further adjustment of the Warrant Exercise Price shall be made upon the actual issuance of such Common Stock or of such convertible securities upon the exercise of such Options or upon the actual issuance of such Common Stock upon conversion or exchange of such convertible securities.

  

  

  

(ii)          Issuance of Convertible Securities.  If the Company in any manner issues or sells any convertible securities and the lowest price per share for which one share of Common Stock is issuable upon the conversion or exchange thereof is less than the Applicable Price, then such share of Common Stock shall be deemed to be outstanding and to have been issued and sold by the Company at the time of the issuance or sale of such convertible securities for such price per share.  For the purposes of this Section 8(b)(ii), the lowest price per share for which one share of Common Stock is issuable upon such conversion or exchange shall be equal to the sum of the lowest amounts of consideration (if any) received or receivable by the Company with respect to one share of Common Stock upon the issuance or sale of the convertible security and upon conversion or exchange of such convertible security.  No further adjustment of the Warrant Exercise Price shall be made upon the actual issuance of such Common Stock upon conversion or exchange of such convertible securities, and if any such issue or sale of such convertible securities is made upon exercise of any Options for which adjustment of the Warrant Exercise Price had been or are to be made pursuant to other provisions of this Section 8(b), no further adjustment of the Warrant Exercise Price shall be made by reason of such issue or sale.

 

(iii)         Change in Option Price or Rate of Conversion.  If the purchase price provided for in any Options, the additional consideration, if any, payable upon the issue, conversion or exchange of any convertible securities, or the rate at which any convertible securities are convertible into or exchangeable for Common Stock changes at any time, the Warrant Exercise Price in effect at the time of such change shall be adjusted to the Warrant Exercise Price which would have been in effect at such time had such Options or convertible securities provided for such changed purchase price, additional consideration or changed conversion rate, as the case may be, at the time initially granted, issued or sold and the number of Warrant Shares issuable upon exercise of this Warrant shall be correspondingly readjusted.  For purposes of this Section 8(b)(iii), if the terms of any Option or convertible security that was outstanding as of the Issuance Date of this Warrant are changed in the manner described in the immediately preceding sentence, then such Option or convertible security and the Common Stock deemed issuable upon exercise, conversion or exchange thereof shall be deemed to have been issued as of the date of such change.  No adjustment pursuant to this Section 8(b) shall be made if such adjustment would result in an increase of the Warrant Exercise Price then in effect.

 

(iv)         Calculation of Consideration Received.  If any Common Stock, Options or convertible securities are issued or sold or deemed to have been issued or sold for cash, the consideration received therefore will be deemed to be the net amount received by the Company therefore.  If any Common Stock, Options or convertible securities are issued or sold for a consideration other than cash, the amount of such consideration received by the Company will be the fair value of such consideration, except where such consideration consists of marketable securities, in which case the amount of consideration received by the Company will be the market price of such securities on the date of receipt of such securities.  If any Common Stock, Options or convertible securities are issued to the owners of the non-surviving entity in connection with any merger in which the Company is the surviving entity, the amount of consideration therefore will be deemed to be the fair value of such portion of the net assets and business of the non-surviving entity as is attributable to such Common Stock, Options or convertible securities, as the case may be.  The fair value of any consideration other than cash or securities will be determined jointly by the Company and the holders of Warrants representing at least two-Fifths (b) of the Warrant Shares issuable upon exercise of the Warrants then outstanding.  If such parties are unable to reach agreement within ten (10) days after the occurrence of an event requiring valuation (the “Valuation Event”), the fair value of such consideration will be determined within five (5) Business Days after the tenth (10th) day following the Valuation Event by an independent, reputable appraiser jointly selected by the Company and the holders of Warrants representing at least two-Fifths (b) of the Warrant Shares issuable upon exercise of the Warrants then outstanding.  The determination of such appraiser shall be final and binding upon all parties and the fees and expenses of such appraiser shall be borne jointly by the Company and the holders of Warrants.

 

(v)          Integrated Transactions.  In case any Option is issued in connection with the issue or sale of other securities of the Company, together comprising one integrated transaction in which no specific consideration is allocated to such Options by the parties thereto, the Options will be deemed to have been issued for a consideration of $0.001.

  

  

  

(vi)        Treasury Shares.  The number of shares of Common Stock outstanding at any given time does not include shares owned or held by or for the account of the Company, and the disposition of any shares so owned or held will be considered an issue or sale of Common Stock.

 

(vii)       Record Date.  If the Company takes a record of the holders of Common Stock for the purpose of entitling them (1) to receive a dividend or other distribution payable in Common Stock, Options or in convertible securities or (2) to subscribe for or purchase Common Stock, Options or convertible securities, then such record date will be deemed to be the date of the issue or sale of the shares of Common Stock deemed to have been issued or sold upon the declaration of such dividend or the making of such other distribution or the date of the granting of such right of subscription or purchase, as the case may be.

 

(c)          Adjustment of Warrant Exercise Price upon Subdivision or Combination of Common Stock.  If the Company at any time after the date of issuance of this Warrant subdivides (by any stock split, stock dividend, recapitalization or otherwise) one or more classes of its outstanding shares of Common Stock into a greater number of shares, any Warrant Exercise Price in effect immediately prior to such subdivision will be proportionately reduced and the number of shares of Common Stock obtainable upon exercise of this Warrant will be proportionately increased.  If the Company at any time after the date of issuance of this Warrant combines (by combination, reverse stock split or otherwise) one or more classes of its outstanding shares of Common Stock into a smaller number of shares, any Warrant Exercise Price in effect immediately prior to such combination will be proportionately increased and the number of Warrant Shares issuable upon exercise of this Warrant will be proportionately decreased.  Any adjustment under this Section 8(c) shall become effective at the close of business on the date the subdivision or combination becomes effective.

 

(d)          Distribution of Assets.  If the Company shall declare or make any dividend or other distribution of its assets (or rights to acquire its assets) to holders of Common Stock, by way of return of capital or otherwise (including, without limitation, any distribution of cash, stock or other securities, property or options by way of a dividend, spin off, reclassification, corporate rearrangement or other similar transaction) (a “Distribution”), at any time after the issuance of this Warrant, then, in each such case:

 

(i)           any Warrant Exercise Price in effect immediately prior to the close of business on the record date fixed for the determination of holders of Common Stock entitled to receive the Distribution shall be reduced, effective as of the close of business on such record date, to a price determined by multiplying such Warrant Exercise Price by a fraction of which (A) the numerator shall be the Closing Sale Price of the Common Stock on the trading day immediately preceding such record date minus the value of the Distribution (as determined in good faith by the Company’s Board of Directors) applicable to one share of Common Stock, and (B) the denominator shall be the Closing Sale Price of the Common Stock on the trading day immediately preceding such record date; and

 

(ii)          either (A) the number of Warrant Shares obtainable upon exercise of this Warrant shall be increased to a number of shares equal to the number of shares of Common Stock obtainable immediately prior to the close of business on the record date fixed for the determination of holders of Common Stock entitled to receive the Distribution multiplied by the reciprocal of the fraction set forth in the immediately preceding clause (i), or (B) in the event that the Distribution is of common stock of a company whose common stock is traded on a national securities exchange or a national automated quotation system, then the holder of this Warrant shall receive an additional warrant to purchase Common Stock, the terms of which shall be identical to those of this Warrant, except that such warrant shall be exercisable into the amount of the assets that would have been payable to the holder of this Warrant pursuant to the Distribution had the holder exercised this Warrant immediately prior to such record date and with an exercise price equal to the amount by which the exercise price of this Warrant was decreased with respect to the Distribution pursuant to the terms of the immediately preceding clause (i).

  

  

  

(e)          Certain Events.  If any event occurs of the type contemplated by the provisions of this Section 8 but not expressly provided for by such provisions (including, without limitation, the granting of stock appreciation rights, phantom stock rights or other rights with equity features), then the Company’s Board of Directors will make an appropriate adjustment in the Warrant Exercise Price and the number of shares of Common Stock obtainable upon exercise of this Warrant so as to protect the rights of the holders of the Warrants; provided, except as set forth in section 8(c),that no such adjustment pursuant to this Section 8(e) will increase the Warrant Exercise Price or decrease the number of shares of Common Stock obtainable as otherwise determined pursuant to this Section 8.

 

(f)          Voluntary Adjustments By Company.  The Company may at any time during the term of this Warrant reduce the then current Exercise Price to any amount and for any period of time deemed appropriate by the Board of Directors of the Company.

 

(g)          Notices.

 

(i)           Immediately upon any adjustment of the Warrant Exercise Price, the Company will give written notice thereof to the holder of this Warrant, setting forth in reasonable detail, and certifying, the calculation of such adjustment.

 

(ii)          The Company will give written notice to the holder of this Warrant at least ten (10) days prior to the date on which the Company closes its books or takes a record (A) with respect to any dividend or distribution upon the Common Stock, (B) with respect to any pro rata subscription offer to holders of Common Stock or (C) for determining rights to vote with respect to any Organic Change (as defined below), dissolution or liquidation, provided that such information shall be made known to the public prior to or in conjunction with such notice being provided to such holder.

 

(iii)         The Company will also give written notice to the holder of this Warrant at least ten (10) days prior to the date on which any Organic Change, dissolution or liquidation will take place, provided that such information shall be made known to the public prior to or in conjunction with such notice being provided to such holder.

 

Section 9.             Purchase Rights; Reorganization, Reclassification, Consolidation, Merger or Sale.

 

(a)           In addition to any adjustments pursuant to Section 8 above, if at any time the Company grants, issues or sells any Options, Convertible Securities or rights to purchase stock, warrants, securities or other property pro rata to the record holders of any class of Common Stock (the “Purchase Rights”), then the Holder will be entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired if the Holder had held the number of shares of Common Stock acquirable upon complete exercise of this Warrant immediately before the date on which a record is taken for the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record holders of Common Stock are to be determined for the grant, issue or sale of such Purchase Rights.

 

(b)          Any recapitalization, reorganization, reclassification, consolidation, merger, sale of all or substantially all of the Company’s assets to another Person or other transaction in each case which is effected in such a way that holders of Common Stock are entitled to receive (either directly or upon subsequent liquidation) stock, securities or assets with respect to or in exchange for Common Stock is referred to herein as an “Organic Change.”  Prior to the consummation of any (i) sale of all or substantially all of the Company’s assets to an acquiring Person or (ii) other Organic Change following which the Company is not a surviving entity, the Company will secure from the Person purchasing such assets or the successor resulting from such Organic Change (in each case, the “Acquiring Entity”) a written agreement (in form and substance satisfactory to Holders representing at least two-Fifths of the Warrant Shares issuable upon exercise of the Warrants then outstanding(iii) of the Warrant Shares issuable upon exercise of the Warrants then outstanding) to deliver to each Holder in exchange for such Warrants, a security of the Acquiring Entity evidenced by a written instrument substantially similar in form and substance to this Warrant and satisfactory to the Holders (including an adjusted warrant exercise price equal to the value for the Common Stock reflected by the terms of such consolidation, merger or sale, and exercisable for a corresponding number of shares of Common Stock acquirable and receivable upon exercise of the Warrants without regard to any limitations on exercise, if the value so reflected is less than any Applicable Warrant Exercise Price immediately prior to such consolidation, merger or sale).  Prior to the consummation of any other Organic Change, the Company shall make appropriate provision (in form and substance satisfactory to the Holders representing a majority of the Warrant Shares issuable upon exercise of the Warrants then outstanding) to insure that each of the Holders will thereafter have the right to acquire and receive in lieu of or in addition to (as the case may be) the Warrant Shares immediately theretofore issuable and receivable upon the exercise of the Holder’s Warrants (without regard to any limitations on exercise), such shares of stock, securities or assets that would have been issued or payable in such Organic Change with respect to or in exchange for the number of Warrant Shares which would have been issuable and receivable upon the exercise of such holder’s Warrant as of the date of such Organic Change (without taking into account any limitations or restrictions on the exercisability of this Warrant).

  

  

  

Seection 10.         Lost, Stolen, Mutilated or Destroyed Warrant.  If this Warrant is lost, stolen, mutilated or destroyed, the Company shall promptly, on receipt of an indemnification undertaking (or, in the case of a mutilated Warrant, the Warrant), issue a new Warrant of like denomination and tenor as this Warrant so lost, stolen, mutilated or destroyed.

 

Section 11.           Notice.  Any notices, consents, waivers or other communications required or permitted to be given under the terms of this Warrant 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 receipt is received by the sending party transmission is mechanically or electronically generated and kept on file by the sending party); or (iii) one Business 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:

 

	
If to the Company, to:

	
NeoMedia Technologies, Inc.

	  	
Two Concourse Parkway, Suite 500

	  	
Atlanta, GA 30328

	  	
Attention:  Chief Executive Officer or Chief Financial Officer

	  	
Telephone:           678-638-0460 (x132)

	  	
Facsimile:             678-638-0466

	  	  
	
With a copy to:

	
K&L Gates LLP

	  	
200 South Biscayne Boulevard – Suite 3900

	  	
Miami, FL  33131-2399

	  	
Attention:             Clayton E. Parker, Esq.

	  	
Telephone:           (305) 539-3300

	  	
Facsimile:             (305) 358-7095

	  	  
	
If to Holder:

	
YA Global Investments, L.P.

	  	
101 Hudson Street – Suite 3700

	  	
Jersey City, NJ  07302

	  	
Attention:              Mark A. Angelo

	  	
Telephone:            (201) 985-8300

	  	
Facsimile:              (201) 985-8266

	  	  
	
With Copy to:

	
David Gonzalez, Esq.

	  	
101 Hudson Street – Suite 3700

	  	
Jersey City, NJ 07302

	  	
Telephone:             (201) 985-8300

	  	
Facsimile:               (201) 985-8266

or at such other address and facsimile as shall be delivered to the Company upon the issuance or transfer of this Warrant.  Each party shall provide five (5) days’ prior written notice to the other party of any change in address or facsimile number.  Written confirmation of receipt (A) given by the recipient of such notice, consent, facsimile, waiver or other communication, (or (B) 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.

  

  

  

Section 12.            Date.  The date of this Warrant is set forth on page 1 hereof.  This Warrant, in all events, shall be wholly void and of no effect after the close of business on the Expiration Date, except that notwithstanding any other provisions hereof, the provisions of Section 8(b) shall continue in full force and effect after such date as to any Warrant Shares or other securities issued upon the exercise of this Warrant.

 

Section 13.            Amendment and Waiver.  Except as otherwise provided herein, the provisions of the Warrants may be amended and the Company may take any action herein prohibited, or omit to perform any act herein required to be performed by it, only if the Company has obtained the written consent of the Holders representing at least two-Fifths of the Warrant Shares issuable upon exercise of the Warrants then outstanding; provided that, except for Section 8(d), no such action may increase the Warrant Exercise Price or decrease the number of shares or class of stock obtainable upon exercise of any Warrant without the written consent of the holder of such Warrant.

 

Section 14.            Descriptive Headings; Governing Law.  The descriptive headings of the several sections and paragraphs of this Warrant are inserted for convenience only and do not constitute a part of this Warrant.  The corporate laws of the State of Delaware shall govern all issues concerning the relative rights of the Company and its stockholders.  All other 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 state and federal courts sitting in Hudson County and the United States District Court for the District of 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.

 

Section 15.           Waiver of Jury Trial.  AS A MATERIAL INDUCEMENT FOR EACH PARTY HERETO TO ENTER INTO THIS WARRANT, THE PARTIES HERETO HEREBY WAIVE ANY RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING RELATED IN ANY WAY TO THIS WARRANT AND/OR ANY AND ALL OF THE OTHER DOCUMENTS ASSOCIATED WITH THIS TRANSACTION.

REMAINDER OF PAGE INTENTIONALLY LEFT BLANK

  

  

  

IN WITNESS WHEREOF, the Company has caused this Warrant to be signed as of the date first set forth above.

 

	
NEOMEDIA TECHNOLOGIES, INC.

	  	  
	
By:

	
/s/ Michael W. Zima

	
Name:       Michael W. Zima

	
Title:         Chief Financial OfficerUnassociated Document

 

Exhibit 10.6

 

NINTH RATIFICATION AGREEMENT

THIS NINTH  RATIFICATION AGREEMENT (hereinafter, this “Agreement”) made this 13th day of April, 2011 by and among:

YA GLOBAL INVESTMENTS, L.P., f/k/a Cornell Capital Partners, LP (the “Lender”), a Cayman Island exempt limited partnership with offices located at 101 Hudson Street Suite 3700, Jersey City, New Jersey 07302; and

NEOMEDIA TECHNOLOGIES, INC. (the “Borrower”), a Delaware corporation with its principal office located at Two Concourse Parkway, Suite 500, Atlanta, Georgia 30328 and whose fax number is (678) 638-0466.

Background

Reference is made to certain financing arrangements entered into by and between the Borrower and certain of its former and/or current subsidiaries (collectively, the “Obligors”) and the Lender, evidenced by, among other things, the documents, instruments, and agreements listed on Schedule “1” attached hereto and incorporated herein by reference (collectively, together with all other documents, instruments, and agreements executed in connection therewith or related thereto, the “Existing Financing Documents”).

The Borrower has represented to the Lender that it requires short term financing for working capital.  In connection therewith, the Borrower has requested that the Lender make an additional financial accommodation to the Borrower in the amount of $450,000.00 to fund ongoing business operations, which financial accommodation shall be evidenced by, among other documents, instruments, and agreements, a certain Secured Convertible Debenture of even date herewith issued by the Borrower in favor of the Lender (the “Fourth 2011 Debenture”, and collectively, together with this Agreement, the Existing Financing Documents, the Related Documents (as defined herein) and all other documents, instruments, and agreements executed in connection therewith or related thereto, the “Financing Documents”).  The Lender has agreed to make such an additional financial accommodation to the Obligors but only upon the condition, among others, that the Borrower enter into this Agreement with the Lender.

Accordingly, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, it is hereby agreed by and between the Borrower and the Lender as follows:

Acknowledgment of Indebtedness

	
1.

	
The Borrower hereby acknowledges and agrees that it is liable to the Lender as follows (all amounts in USD):

 

	
  

	
a.

	
Owed under the CCP-1 Debenture as of April 13, 2011:

 

	
Principal

	 	$	5,000,000.00	 
	
Interest

	 	 	2,017,770.95	 
	
Total

	 	$	7,017,770.95	 

	
  

	
b.

	
Owed under the CCP-2 Debenture as of April 13, 2011:

 

	
Principal

	 	$	2,500,000.00	 
	
Interest

	 	 	1,010,096.67	 
	
Total

	 	$	3,510,093.67	 

  

  

  

	
  

	
c.

	
Owed under the NEOM-4-1 Debenture as of April 13, 2011:

 

	
Principal

	 	$	7,458,651.00	 
	
Interest

	 	 	1,928,972.13	 
	
Total

	 	$	9,387,623.13	 

 

	
  

	
d.

	
Owed under the NEOM-1-1 Debenture as of April 13, 2011:

 

	
Principal

	 	$	1,775,000.00	 
	
Interest

	 	 	902,769.86	 
	
Total

	 	$	2,677,769.86	 

 

	
  

	
e.

	
Owed under the NEOM-2008-1 Debenture as of April 13, 2011:

 

	
Principal

	 	$	390,000.00	 
	
Interest

	 	 	178,587.50	 
	
Total

	 	$	568,587.50	 

 

	
  

	
f.

	
Owed under the NEOM-2008-2 Debenture as of April 13, 2011:

 

	
Principal

	 	$	500,000.00	 
	
Interest

	 	 	221,458.33	 
	
Total

	 	$	721,458.33	 

	
  

	
g.

	
Owed under the NEOM-2008-3 Debenture as of April 13, 2011:

 

	
Principal

	 	$	790,000.00	 
	
Interest

	 	 	345,625.00	 
	
Total

	 	$	1,135,625.00	 

	
  

	
h.

	
Owed under the NEOM-2008-4 Debenture as of April 13, 2011:

 

	
Principal

	 	$	137,750.00	 
	
Interest

	 	 	57,855.00	 
	
Total

	 	$	195,605.00	 

 

	
  

	
i.

	
Owed under the NEOM-9-1 Debenture as of April 13, 2011:

 

	
Principal

	 	$	2,325,000.00	 
	
Interest

	 	 	881,971.23	 
	
Total

	 	$	3,206,971.23	 

 

	
  

	
j.

	
Owed under the NEOM-9-2 Debenture as of April 13, 2011:

 

	
Principal

	 	$	2,325,000.00	 
	
Interest

	 	 	800,819.18	 
	
Total

	 	$	3,125,819.18	 

 

	
  

	
k.

	
Owed under the NEOM-9-4 Debenture as of April 13, 2011:

 

	
Principal

	 	$	258,035.80	 
	
Interest

	 	 	99,910.47	 
	
Total

	 	$	357,947.27	 

  

  

  

	
  

	
l.

	
Owed under the NEOM-9-5 Debenture as of April 13, 2011:

 

	
Principal

	 	$	715,000.00	 
	
Interest

	 	 	185,939.18	 
	
Total

	 	$	900,939.18	 

 

	
  

	
m.

	
Owed under the NEOM-9-6 Debenture as of April 13, 2011:

 

	
Principal

	 	$	535,000.00	 
	
Interest

	 	 	130,921.10	 
	
Total

	 	$	665,921.10	 

 

	
  

	
n.

	
Owed under the NEOM-9-7 Debenture as of April 13, 2011:

 

	
Principal

	 	$	475,000.00	 
	
Interest

	 	 	110,772.60	 
	
Total

	 	$	585,772.60	 

 

	
  

	
o.

	
Owed under the NEOM-10-1 Debenture as of April 13, 2011:

 

	
Principal

	 	$	2,006,137.04	 
	
Interest

	 	 	247,771.66	 
	
Total

	 	$	2,253,908.70	 

 

	
  

	
p.

	
Owed under the NEOM-10-2 Debenture as of April 13, 2011:

 

	
Principal

	 	$	550,000.00	 
	
Interest

	 	 	51,473.97	 
	
Total

	 	$	601,473.97	 

 

	
  

	
q.

	
Owed under the NEOM-10-3 Debenture as of April 13, 2011:

 

	
Principal

	 	$	475,000.00	 
	
Interest

	 	 	35,891.78	 
	
Total

	 	$	510,891.78	 

 

	
  

	
r.

	
Owed under the NEOM-10-4 Debenture as of April 13, 2011:

 

	
Principal

	 	$	400,000.00	 
	
Interest

	 	 	25,775.34	 
	
Total

	 	$	425,775.34	 

 

	
  

	
s.

	
Owed under the NEOM-10-5 Debenture as of April 13, 2011:

 

	
Principal

	 	$	450,000.00	 
	
Interest

	 	 	20,712.33	 
	
Total

	 	$	470,712.33	 

 

	
  

	
t.

	
Owed under the NEOM-11-1 Debenture as of April 13, 2011:

 

	
Principal

	 	$	450,000.00	 
	
Interest

	 	 	16,224.66	 
	
Total

	 	$	466,224.66	 

  

  

  

	
  

	
u.

	
Owed under the NEOM-11-2 Debenture as of April 13, 2011:

 

	
Principal

	 	$	650,000.00	 
	
Interest

	 	 	16,205.48	 
	
Total

	 	$	666,205.48	 

	
  

	
v.

	
Owed under the NEOM-11-3 Debenture as of April 13, 2011:

 

	
Principal

	 	$	450,000.00	 
	
Interest

	 	 	5,868.49	 
	
Total

	 	$	455,868.49	 

	
  

	
w.

	
For all interest accruing from and after April 13, 2011 due under the above-referenced debentures and notes, and for all fees, late charges, redemption premiums, liquidated damages, costs, expenses, and costs of collection (including attorneys’ fees and expenses) and other amounts, heretofore or hereafter accrued or coming due or incurred by the Lender in connection with the protection, preservation, or enforcement of its rights and remedies under the Financing Documents (including, without limitation, the preparation and negotiation of this Agreement).

 

Hereinafter, all amounts due as set forth in this Paragraph 1, and all amounts hereafter owed or due under the Fourth 2011 Debenture and/or the other Financing Documents shall be referred to collectively as the “Obligations”.

 

Waiver of Claims

	
2.

	
The Borrower, for itself and on behalf of any other Obligors, hereby acknowledges and agrees that none of the Obligors have any offsets, defenses, claims, or counterclaims against the Lender, its general partner, and its investment manager, and each of their respective agents, servants, attorneys, advisors, officers, directors, employees, affiliates, partners, members, managers, predecessors, successors, and assigns (singly and collectively, as the “Released Parties”), with respect to the Obligations, the Financing Documents, the transactions set forth or otherwise contemplated in this Agreement, or otherwise, and that if the Obligors now have, or ever did have, any offsets, defenses, claims, or counterclaims against any of the Released Parties, whether known or unknown, at law or in equity, from the beginning of the world through this date and through the time of execution of this Agreement, all of them are hereby expressly WAIVED, and the Obligors each hereby RELEASE each of the Released Parties from any and all liability therefor.

 

Ratification of Financing Documents; Confirmation of Collateral; Cross-Default;

Cross-Collateralization; Further Assurances

	
3.

	
The Borrower:

 

	
  

	
a.

	
Hereby ratifies, confirms, and reaffirms all and singular the terms and conditions of the Existing Financing Documents, and acknowledges and agrees that, subject to the terms and conditions of this Agreement, all terms and conditions of the Existing Financing Documents shall remain in full force and effect;

 

	
  

	
b.

	
Hereby ratifies, confirms, and reaffirms that (i) the obligations secured by the Financing Documents include, without limitation, the Obligations, and any future modifications, amendments, substitutions, or renewals thereof, (ii) all collateral, whether now existing or hereafter acquired, granted to the Lender pursuant to the Financing Documents, or otherwise, shall secure all of the Obligations until the full, final, and indefeasible payment of the Obligations, and (iii) subject to the provisions of Paragraph 6, below, the occurrence of a default and/or event of default under any Financing Document shall constitute a default and an event of default under all of the Financing Documents, it being the express intent of the Borrower that all of the Obligations be fully cross-collateralized, cross-guaranteed, and cross-defaulted;

 

  

  

  

	
  

	
c.

	
Has previously granted the Lender security interests in all of its assets, and to confirm the same the Borrower hereby grants the Lender a security interest in all of its assets, whether now existing or hereafter acquired, including, without limitation, all accounts, inventory, goods, equipment, software and computer programs, securities, investment property, financial assets, deposit accounts, chattel paper, electronic chattel paper, instruments, patents, patent applications, copyrights, trademarks, trademark applications, trade names, domain names, documents, letter-of-credit rights, health-care-insurance receivables, supporting obligations, notes secured by real estate, commercial tort claims, and general intangibles including payment intangibles, to secure the Obligations free and clear of all liens and encumbrances;

 

	
  

	
d.

	
Shall, from and after the execution of this Agreement, execute and deliver to the Lender whatever additional documents, instruments, and agreements that the Lender may require in order to correct any document deficiencies, or to vest or perfect the Financing Documents and the collateral granted therein more securely in the Lender and/or to otherwise give effect to the terms and conditions of this Agreement and/or the Related Documents, and hereby irrevocably authorizes the Lender to file any financing statements (including financing statements with a generic description of the collateral such as “all assets”), and take any other normal and customary steps, the Lender deems necessary to perfect or evidence the Lender’s security interests and liens in any such collateral; and

 

	
  

	
e.

	
Acknowledges and agrees that this Agreement shall constitute an authenticated record as such term is defined in the Uniform Commercial Code.

 

	
  

	
f.

	
In accordance with Section 6.17 of the Security Agreement dated as of July 29, 2008 (the “2008 Security Agreement”) entered into by and between the  Borrower and the Lender, and Section 7(f) hereof, hereby grants the Lender a security interest in all of Borrower’s rights arising from, in connection with, or relating to any commercial tort claims listed on Schedule 2 hereto, and all judgments, proceeds, products, and awards related to the foregoing (collectively, the “Tort Claims”).  The Borrower acknowledges and agrees that the Tort Claims constitutes Pledged Property (as defined in the 2008 Security Agreement) and secures all of the Obligations, including those pursuant to the Fourth 2011 Debenture.

 

	
  

	
Conditions Precedent

 

	
4.

	
The Lender’s agreements hereunder as contemplated herein shall not be effective unless and until each of the following conditions precedent have been fulfilled, pursuant to documentation in form and substance satisfactory to the Lender in all respects, all as determined by the Lender in its sole and exclusive discretion:

 

	
  

	
a.

	
The Lender shall have received such lien searches and other evidence as the Lender may require to confirm that the Lender’s liens and security interests in the collateral pledged by the Obligors remain duly perfected, first priority security interests, subject only to such liens and security interests granted in favor of the Lender;

 

	
  

	
b.

	
The Borrower shall have (i) executed and delivered to the Lender all documents, instruments, and agreements required by the Lender in connection with the Fourth 2011 Debenture in a form and substance acceptable to the Lender in all respects; and (ii) satisfied all conditions precedent to the effectiveness thereof in a manner satisfactory to the Lender in all respects;

 

  

  

  

	
  

	
c.

	
The Obligors shall have paid to the Lender’s investment manager, Yorkville Advisors, LLC, a commitment and structuring fee in the amount of $25,000.00 in good and collected funds in accordance with the closing statement attached hereto as Exhibit “A”;

 

	
  

	
d.

	
The Borrower shall have taken any and all actions necessary to perfect and further perfect the Lender’s security interest in the Borrower’s intellectual property, including without limitation, obtaining, executing and/or filing any documents, instruments, or agreements necessary to perfect or vest title to all patents and patent applications set forth in the Financing Documents in the name of the Borrower, and to perfect the Lender’s security interests in all of the Borrower’s intellectual property, including without limitation, patents and patent applications.

 

	
  

	
e.

	
All action on the part of the Borrower necessary for the valid execution, delivery and performance by the Borrower of this Agreement shall have been duly and effectively taken and evidence thereof, including, without limitation, an opinion of the Borrower’s counsel, satisfactory to the Lender in all respects shall have been provided to the Lender; and

 

	
  

	
f.

	
This Agreement, and all documents, instruments, and agreements required in connection with, related to, or contemplated by this Agreement (collectively, the “Related Documents”), shall be executed and delivered to the Lender by the parties thereto, shall be in full force and effect and shall be form and substance satisfactory to the Lender.

 

New Loan

 

	
5.

	
The Borrower has requested that the Lender make a short-term loan in the original principal amount of $450,000.00 (the “New Loan”) to fund ongoing business operations. Upon the satisfaction of all of the conditions precedent set forth in Paragraph 4 of this Agreement, as determined by the Lender in the Lender’s sole and exclusive discretion, and subject to the terms and conditions of the Fourth 2011 Debenture and the Related Documents, the New Loan shall (a) be made by the Lender in accordance with the terms and conditions of the Fourth 2011 Debenture and the other Financing Documents, (b) constitute a portion of the Obligations, and (c) be secured by all of the collateral granted to the Lender by the Obligors.  The Borrower hereby acknowledges and agrees that (x) the New Loan is a single, one time loan, (y) by making the New Loan the Lender is not agreeing to make any further loans in the future, and (z) will be repaid in full on or before July 29, 2012.

 

Provision Regarding Events of Default Under The Financing Documents

 

	
6.

	
The Lender hereby agrees that from and after the execution of this Agreement, the breach of, or failure to comply with, a provision of the Financing Documents by the Borrower shall not constitute an event of default under the Financing Documents unless and until the Lender declares such breach or failure to comply to be an event of default in a written notice sent to the Borrower by facsimile and at the address set forth in this Agreement by nationally-recognized overnight delivery service (i.e., Federal Express, UPS), provided, however, that (a) such declaration shall be effective upon the delivery of the notice to such overnight delivery service and shall not require proof that the Borrower received the same, and (b) no such declaration or notice shall be required with respect to any breach or default occurring as a result of, or in the nature of, a bankruptcy of the Borrower or any similar insolvency proceeding or action (including, without limitation, any assignment for the benefit of creditors, composition, reorganization, or the like) filed by or against the Borrower, each of which shall be an immediate event of default.

 

Representations, Warranties, and Covenants

 

	
7.

	
The Borrower hereby represents, warrants, and covenants to the Lender as follows:

 

	
  

	
a.

	
The execution and delivery of this Agreement and the other Financing Documents by the Borrower and the performance by the Borrower of its obligations and agreements under this Agreement and the other Financing Documents are within the authority of the Borrower, have been duly authorized by all necessary corporate proceedings on behalf of the Borrower, and do not and will not contravene any provision of law, statute, rule or regulation to which the Borrower is subject or, if applicable, any charter, other organization papers, by-laws, or any stock provision or any amendment thereof or of any agreement or other instrument binding upon the Borrower.

 

  

  

  

	
  

	
b.

	
This Agreement and the other Financing Documents constitute legal, valid, and binding obligations of the Borrower, enforceable in accordance with their respective terms.

 

	
  

	
c.

	
No approval or consent of, or filing with, any governmental agency or authority is required to make valid and legally binding the execution, delivery or performance by the Borrower of this Agreement or the other Financing Documents.

 

	
  

	
d.

	
The Borrower has performed and complied in all material respects with all terms and conditions herein required to be performed or complied with by the Borrower prior to or at the time hereof, and as of the date hereof, no default or event of default has occurred and is continuing under any of the Financing Documents.

 

	
  

	
e.

	
The representations and warranties contained in the Financing Documents were true and correct in all material respects at and as of the date made and are true and correct as of the date hereof, except to the extent of changes resulting from transactions specifically contemplated or specifically permitted by this Agreement and the other Financing Documents, changes which have been disclosed in writing to the Lender on or prior to the date hereof and changes occurring in the ordinary course of business that singly or in the aggregate are not materially adverse, and except to the extent that such representations and warranties relate expressly to an earlier date.

 

	
  

	
f.

	
The Borrower currently has no commercial tort claims (as such term is defined in the Uniform Commercial Code) and hereby covenants and agrees that in the event the Borrower shall hereafter hold or acquire a commercial tort claim, the Borrower shall immediately notify the Lender of the particulars of such claim in writing and shall grant to the Lender a security interest therein and in the proceeds thereof, upon such terms and documentation as may be satisfactory to the Lender.

 

	
  

	
g.

	
The Borrower has read and understands each of the terms and conditions of this Agreement and the other Financing Documents and that it is entering into this Agreement and the other Financing Documents freely and voluntarily, without duress, after having had an opportunity for consultation with independent counsel of its own selection, and not in reliance upon any representations, warranties, or agreements made by the Lender and not set forth in this Agreement or the other Financing Documents.

 

	
  

	
h.

	
The Borrower acknowledges and agrees that nothing contained in this Agreement or the Related Documents shall be deemed to constitute (a) a waiver of any defaults or events of default now existing or hereafter arising, or any events that, but for the passage of time or the giving of notice, would constitute defaults or events of default, (b) an agreement to forbear by the Lender with respect to such defaults or events of default, or (c) except as expressly set forth herein, an amendment, modification, extension, or waiver of any of the terms of the Financing Documents or of any of the Lender’s rights and remedies thereunder.

 

	
  

	
i.

	
NeoMedia Migration, Inc. (“Migration”) is a wholly owned subsidiary of the Borrower which has no assets, employees, or operations and which the Borrower intends to dissolve upon completion and filing of Migration’s final tax return. The Borrower hereby covenants and agrees that Migration shall have no assets, employees, or operations going forward and that the Borrower will not transfer, or cause the transfer of, any assets to Migration, or allow or cause Migration to have any employees or business operations hereafter.  The Borrower specifically acknowledges and agrees that the Lender is relying upon this provision in determining to enter into this Agreement.

 

	
  

	
j.

	
The Borrower shall not, and shall not permit or direct any of the other Obligors to license, transfer, assign, or otherwise divest their interest in their respective assets, including without limitation, patents and patent applications, without the prior written consent of the Lender, which consent may be granted or withheld in the Lender’s sole and exclusive discretion.

 

  

  

  

Costs of Collection

	
8.

	
The Borrower shall reimburse the Lender on demand for any and all unreimbursed costs, expenses, and costs of collection (including attorneys’ fees and expenses) heretofore or hereafter incurred by the Lender in connection with the protection, preservation, and enforcement by the Lender of its rights and remedies under the Financing Documents, the Related Documents, and/or this Agreement, including, without limitation, the negotiation and preparation of this Agreement and the Related Documents, and/or any matters related thereto.

 

Waiver of Jury Trial

	
9.

	
The Borrower and the Lender hereby make the following waiver knowingly, voluntarily, and intentionally, and understand that the other, in entering into this Agreement, is relying on such a waiver:  THE BORROWER AND THE LENDER EACH HEREBY IRREVOCABLY WAIVE ANY PRESENT OR FUTURE RIGHT TO A JURY IN ANY TRIAL OF ANY CASE OR CONTROVERSY IN WHICH THE OTHER BECOMES A PARTY (WHETHER SUCH CASE OR CONTROVERSY IS INITIATED BY OR AGAINST SUCH PARTY OR IN WHICH SUCH PARTY IS JOINED AS A PARTY LITIGANT), WHICH CASE OR CONTROVERSY ARISES OUT OF, OR IS IN RESPECT OF, ANY RELATIONSHIP BETWEEN THE OBLIGORS, OR ANY OTHER PERSON, AND THE LENDER.

 

Credit Bidding

 

	
10.

	
The Borrower hereby acknowledges and agrees, in further consideration for the Lender entering into this Agreement, that the Lender shall be permitted to credit bid the Obligations at any auction and/or other sale, including without limitation, at any auction and/or other sale or disposition conducted under or in connection with any of the sections or chapters of the Bankruptcy Code, 11 U.S.C. §101 et seq. (the “Bankruptcy Code”).  The Borrower hereby acknowledges and agrees that this provision is a material inducement to the Lender entering into this Agreement.  The Lender, in turn, acknowledges that this paragraph shall not be construed as a restriction or prohibition on any Borrower’s right to file any voluntary petition or make application for or seek relief or protection under the Bankruptcy Code.  The Borrower acknowledges and agrees that the agreements as set forth in this Paragraph shall survive expiration and/or termination of this Agreement.

 

Consent to Jurisdiction

 

	
11.

	
The Borrower agrees that any legal action, proceeding, case, or controversy against the Borrower with respect to the Financing Documents or this Agreement may be brought in the state court or the United States District Court having jurisdiction in Jersey City, New Jersey (each a “Court”), as the Lender may elect in the Lender’s sole discretion.  By execution and delivery of this Agreement, the Borrower, for itself, and in respect of its property, accepts, submits, and consents generally and unconditionally, to the jurisdiction of the aforesaid courts.  The Borrower further hereby:

 

	
  

	
a.

	
WAIVES personal service of any and all process upon it, and irrevocably consents to the service of process out of any of the aforementioned courts in any such action or proceeding by the mailing of copies thereof by certified mail, postage prepaid, to the Borrower at its addresses as specified herein, such service to become effective five (5) days after such mailing.

 

	
  

	
b.

	
WAIVES any objection based on forum non conveniens and any objection to venue of any action or proceeding instituted under the Financing Documents or this Agreement and consents to the granting of such legal or equitable remedy as is deemed appropriate by a Court.

 

  

  

  

	
  

	
c.

	
Agrees that any action or proceeding commenced by the Borrower asserting any claim arising under or in connection with the Financing Documents or this Agreement shall be brought solely in a state court or the United States District Court having jurisdiction in Jersey City, New Jersey, and that such Courts shall have exclusive jurisdiction with respect to any such action instituted by the Borrower.

 

	
  

	
d.

	
Agrees that any voluntary petition or application filed by the Borrower seeking relief or protection under the Bankruptcy Code shall be filed in a United States Bankruptcy Court for the District of Florida, a United States Bankruptcy Court for the District of Georgia, or a United States Bankruptcy Court for the District of Nevada, and that if the Borrower files a petition or application for relief in any other jurisdiction, the Lender shall have the right, in its sole and exclusive discretion, to transfer any such proceeding to one of the foregoing courts that has jurisdiction over the Borrower under the Bankruptcy Code.

 

	
  

	
e.

	
Agree that nothing herein shall affect the right of the Lender to bring legal actions or proceedings in any other competent jurisdiction.

 

Non-Interference

 

	
12.

	
From and after the date hereof, the Borrower agrees:

 

	
  

	
a.

	
Not to interfere with the exercise by the Lender of any of its rights and remedies under this Agreement, the Related Documents, the Financing Documents, and/or applicable law;

 

	
  

	
b.

	
The Borrower shall not seek to distrain or otherwise hinder, delay, or impair the Lender’s efforts to realize upon any collateral or otherwise to enforce its rights and remedies pursuant to this Agreement, the Related Documents, the Financing Documents, and/or applicable law, and shall at all times cooperate with the Lender’s exercise of its rights and remedies under this Agreement, the Related Documents, the Financing Documents, and/or applicable law; and

 

	
  

	
c.

	
The provisions of this Paragraph shall be specifically enforceable by the Lender.

 

Entire Agreement

 

	
13.

	
This Agreement shall be binding upon the Borrower and the Borrower’s employees, representatives, successors, and assigns, and shall inure to the benefit of the Lender and the Lender’s successors and assigns.  This Agreement and the other Financing Documents incorporate all of the discussions and negotiations between the Borrower and the Lender, either express or implied, concerning the matters included herein and in such other documents, instruments, and agreements, any statute, custom, or usage to the contrary notwithstanding.  No such discussions or negotiations shall limit, modify, or otherwise affect the provisions hereof.  No modification, amendment, or waiver of any provision of this Agreement, or any provision of any other document, instrument, or agreement between the Obligors, or any one of them, and the Lender shall be effective unless executed in writing by the party to be charged with such modification, amendment, or waiver, and if such party be the Lender, then by a duly authorized representative thereof.

 

Construction of Agreement

	
14.

	
In connection with the interpretation of this Agreement and the other Financing Documents:

 

	
  

	
a.

	
All rights and obligations hereunder and thereunder, including matters of construction, validity, and performance, shall be governed by and construed in accordance with the law of the State of New Jersey and are intended to take effect as sealed instruments.

 

	
  

	
b.

	
The captions of this Agreement are for convenience purposes only, and shall not be used in construing the intent of the Lender and the Borrower under this Agreement.

 

  

  

  

	
  

	
c.

	
In the event of any inconsistency between the provisions of this Agreement and any other document, instrument, or agreement entered into by and between the Lender and the Borrower, the provisions of this Agreement shall govern and control.

 

	
  

	
d.

	
The Lender and the Borrower have prepared this Agreement and the other Financing Documents with the aid and assistance of their respective counsel.  Accordingly, all of them shall be deemed to have been drafted jointly by the Lender and the Borrower and shall not be construed against either the Lender or the Borrower.

 

Illegality or Unenforceability

	
15.

	
Any determination that any provision or application of this Agreement is invalid, illegal, or unenforceable in any respect, or in any instance, shall not affect the validity, legality, or enforceability of any such provision in any other instance, or the validity, legality, or enforceability of any other provision of this Agreement.

 

Counterparts

	
16.

	
This Agreement may be executed in multiple identical counterparts (including by facsimile or e-mail transmission of an adobe file format document (also known as a PDF file)), each of which when duly executed shall be deemed an original, and all of which shall be construed together as one agreement.  This Agreement will not be binding on or constitute evidence of a contract between the parties hereto until such time as a counterpart has been executed by such party and a copy thereof is delivered to each other party to this Agreement.

 

[Remainder of Page Intentionally Left Blank]

  

  

  

IN WITNESS WHEREOF, this Ratification Agreement has been executed as of the date first set forth above.

	
YA GLOBAL INVESTMENTS, L.P.,

	 	
NEOMEDIA TECHNOLOGIES, INC.

	
f/k/a Cornell Capital Partners, LP

	 	  
	
By:

	
Yorkville Advisors, LLC,

	 	
 

	
 

	  	
its Investment Manager

	 	
 

	  	  	 	
 

	
By:

	
/s/ Gerald Eicke

	 	
By:

	
/s/ Michael W. Zima

	
Name:    Gerald Eicke

	 	
Name:   Michael W. Zima

	
Title:      Managing Member

	 	
Title:     CFO

 

  

  

  

Schedule “1”

(Financing Documents)

DEBENTURES AND NOTES

 

	
  

	
1.

	
Secured Convertible Debenture dated August 23, 2006 issued by the Borrower to the Lender in the original principal amount of $5,000,000.00 (hereinafter, as amended and in effect, the “CCP-1 Debenture”), as amended by that certain Amendment to NeoMedia Technologies, Inc. Secured Convertible Debenture No. CCP-1 dated as of January 5, 2010 entered into by and between the Borrower and the Lender;

 

	
  

	
2.

	
Secured Convertible Debenture dated December 29, 2006 issued by the Borrower to the Lender in the original principal amount of $2,500,000.00 (hereinafter, as amended and in effect, the “CCP-2 Debenture”), as amended by that certain Amendment to NeoMedia Technologies, Inc. Secured Convertible Debenture No. CCP-2 dated as of January 5, 2010 by and between the Borrower and the Lender;

 

	
  

	
3.

	
Secured Convertible Debenture dated March 27, 2007 issued by the Borrower to the Lender in the original principal amount of $7,458,651.00 (hereinafter, as amended and in effect, the “NEOM-4-1 Debenture”), as amended by that certain Amendment to NeoMedia Technologies, Inc. Secured Convertible Debenture No. NEOM-4-1 dated as of January 5, 2010 entered into by and between the Borrower and the Lender;

 

	
  

	
4.

	
Secured Convertible Debenture dated August 24, 2007 issued by the Borrower to the Lender in the original principal amount of $1,775,000.00 (hereinafter, as amended and in effect, the “NEOM-1-1 Debenture”), as amended by that certain letter agreement dated as of August 14, 2009, and as further amended by that certain Amendment to NeoMedia Technologies, Inc. Secured Convertible Debenture No. NEOM-1-1 dated as of January 5, 2010 entered into by and between the Borrower and the Lender;

 

	
  

	
5.

	
Secured Convertible Debenture dated April 11, 2008 issued by the Borrower to the Lender in the original principal amount of $390,000.00 (hereinafter, as amended and in effect, the “NEOM-2008-1 Debenture”), as amended by that certain Amendment to NeoMedia Technologies, Inc. Secured Convertible Debenture No. NEOM-2008-1 dated as of January 5, 2010 entered into by and between the Borrower and the Lender;

 

	
  

	
6.

	
Secured Convertible Debenture dated May 16, 2008 issued by the Borrower to the Lender in the original principal amount of $500,000.00 (hereinafter, as amended and in effect, the “NEOM-2008-2 Debenture”), as amended by that certain Amendment to NeoMedia Technologies, Inc. Secured Convertible Debenture No. NEOM-2008-2 dated as of January 5, 2010 entered into by and between the Borrower and the Lender;

 

	
  

	
7.

	
Secured Convertible Debenture dated May 29, 2008 issued by the Borrower to the Lender in the original principal amount of $790,000.00 (hereinafter, as amended and in effect, the “NEOM-2008-3 Debenture”), as amended by that certain Amendment to NeoMedia Technologies, Inc. Secured Convertible Debenture No. NEOM-2008-3 dated as of January 5, 2010 entered into by and between the Borrower and the Lender;

 

	
  

	
8.

	
Secured Convertible Debenture dated July 10, 2008 issued by the Borrower to the Lender in the original principal amount of $137,750.00 (hereinafter, as amended and in effect, the “NEOM-2008-4 Debenture”), as amended by that certain Amendment to NeoMedia Technologies, Inc. Secured Convertible Debenture No. NEOM-2008-4 dated as of January 5, 2010 entered into by and between the Borrower and the Lender;

 

  

  

  

	
  

	
9.

	
Secured Convertible Debenture dated July 29, 2008 issued by the Borrower to the Lender in the original principal amount of $2,325,000.00 (hereinafter, as amended and in effect, the “NEOM-9-1 Debenture”), as amended by that certain Amendment to NeoMedia Technologies, Inc. Secured Convertible Debenture No. NEOM-9-1 dated as of January 5, 2010 entered into by and between the Borrower and the Lender;

 

	
  

	
10.

	
Secured Convertible Debenture dated October 28, 2008 issued by the Borrower to the Lender in the original principal amount of $2,325,000.00 (hereinafter, as amended and in effect, the “NEOM-9-2 Debenture”), as amended by that certain Amendment to NeoMedia Technologies, Inc. Secured Convertible Debenture No. NEOM-9-2 dated as of January 5, 2010 entered into by and between the Borrower and the Lender;

 

	
  

	
11.

	
Secured Convertible Debenture dated May 1, 2009 issued by the Borrower to the Lender in the original principal amount of $550,000.00 (hereinafter, as amended and in effect, the “NEOM-9-4 Debenture”), as amended by that certain Amendment to NeoMedia Technologies, Inc. Secured Convertible Debenture No. NEOM-9-4 dated as of January 5, 2010 entered into by and between the Borrower and the Lender;

 

	
  

	
12.

	
Secured Convertible Debenture dated June 5, 2009 issued by the Borrower to the Lender in the original principal amount of $715,000.00 (hereinafter, as amended and in effect, the “NEOM-9-5 Debenture”), as amended by that certain Amendment to NeoMedia Technologies, Inc. Secured Convertible Debenture No. NEOM-9-5 dated as of January 5, 2010 entered into by and between the Borrower and the Lender;

 

	
  

	
13.

	
Secured Convertible Debenture dated July 15, 2009 issued by the Borrower to the Lender in the original principal amount of $535,000.00 (hereinafter, as amended and in effect, the “NEOM-9-6 Debenture”), as amended by that certain Amendment to NeoMedia Technologies, Inc. Secured Convertible Debenture No. NEOM-9-6 dated as of January 5, 2010 entered into by and between the Borrower and the Lender;

 

	
  

	
14.

	
Secured Convertible Debenture dated August 14, 2009 issued by the Borrower to the Lender in the original principal amount of $475,000.00 (hereinafter, as amended and in effect, the “NEOM-9-7 Debenture”), as amended by that certain Amendment to NeoMedia Technologies, Inc. Secured Convertible Debenture No. NEOM-9-7 dated as of January 5, 2010 entered into by and between the Borrower and the Lender;

 

	
  

	
15.

	
Secured Convertible Debenture dated May 27, 2010 issued by the Borrower to the Lender in the original principal amount of $2,006,137.04 (hereinafter, as amended and in effect, the “NEOM-10-1 Debenture”)

 

	
  

	
16.

	
Secured Convertible Debenture dated August 13, 2010 issued by the Borrower to the Lender in the original principal amount of $550,000.00 (hereinafter, as amended and in effect, the “NEOM-10-2 Debenture”);

 

	
  

	
17.

	
Secured Convertible Debenture dated September 29, 2010 issued by the Borrower to the Lender in the original principal amount of $475,000.00 (hereinafter, as amended and in effect, the “NEOM-10-3 Debenture”);

 

	
  

	
18.

	
Secured Convertible Debenture dated October 28, 2010 issued by the Company to the Investor in the original principal amount of $400,000 (hereinafter, as amended and in effect, the “NEOM-10-4 Debenture”),

 

	
  

	
19.

	
Secured Convertible Debenture dated December 15, 2010 issued by the Borrower to the Lender in the original principal amount of $450,000.00 (hereinafter, as amended and in effect, the “NEOM-10-5 Debenture”);

 

  

  

  

	
  

	
20.

	
Secured Convertible Debenture dated January 10, 2011 issued by the Borrower to the Lender in the original principal amount of $450,000.00 (hereinafter, as amended and in effect, the “NEOM-11-1 Debenture”);

 

	
  

	
21.

	
Secured Convertible Debenture dated February 8, 2011 issued by the Borrower to the Lender in the original principal amount of $650,000.00 (hereinafter, as amended and in effect, the “NEOM-11-2 Debenture”);

 

	
  

	
22.

	
Secured Convertible Debenture dated Mach 11, 2011 issued by the Borrower to the Lender in the original principal amount of $450,000.00 (hereinafter, as amended and in effect, the “NEOM-11-3 Debenture”) and collectively, together with the CCP-1 Debenture, the CCP-2 Debenture, the NEOM 4-1 Debenture, the NEOM 1-1 Debenture, the NEOM 2008-1 Debenture, the NEOM 2008-2 Debenture, the NEOM 2008-3 Debenture, the NEOM 2008-4 Debenture, the NEOM 9-1 Debenture, the NEOM 9-2 Debenture, the NEOM 9-4 Debenture, the NEOM 9-5 Debenture, the NEOM 9-6 Debenture, the NEOM 9-7 Debenture, the NEOM-10-2 Debenture, the NEOM-10-3 Debenture, the NEOM-10-4 Debenture and the NEOM-10-5 Debenture, the NEOM-11-1 Debenture, the NEOM-11-2 Debenture and the Fourth 2011 Debenture, the “Debentures”);

 

	
  

	
23.

	
Master Amendment Agreement dated as of March 27, 2007 by and between the Company and the Investor;

 

SECURITIES PURCHASE AGREEMENTS

 

	
  

	
24.

	
Securities Purchase Agreement dated as of August 23, 2006 entered into by and between the Borrower and the Lender;

 

	
  

	
25.

	
Securities Purchase Agreement dated as of December 29, 2006 entered into by and between the Borrower and the Lender;

 

	
  

	
26.

	
Securities Purchase Agreement dated as of March 27, 2007 entered into by and between the Borrower and the Lender;

 

	
  

	
27.

	
Securities Purchase Agreement dated as of August 24, 2007 entered into by and between the Borrower and the Lender;

 

	
  

	
28.

	
Securities Purchase Agreement dated as of July 29, 2008 entered into by and between the Borrower and the Lender, as amended on April 6, 2009;

 

	
  

	
29.

	
Agreement dated June 5, 2009 by and between the Borrower and the Lender pursuant to which the Lender purchased a secured convertible debenture in the original principal amount of $715,000;

 

	
  

	
30.

	
Agreement dated July 15, 2009 by and between the Borrower and the Lender pursuant to which the Lender purchased a secured convertible debenture in the original principal amount of $535,000;

 

	
  

	
31.

	
Agreement dated August 14, 2009 by and between the Borrower and the Lender pursuant to which the Lender purchased a secured convertible debenture in the original principal amount of $475,000;

 

	
  

	
32.

	
Securities Purchase Agreement, dated as of May 27, 2010, by and among the Borrower and the Lender pursuant to which the Lender purchased a Secured Convertible Debenture in the original principal amount of $2,006,137.04;

 

  

  

  

	
  

	
33.

	
Agreement, dated as of August 13, 2010, by and among the Borrower and the Lender pursuant to which the Lender purchased a Secured Convertible Debenture in the original principal amount of $550,000.00;

 

	
  

	
34.

	
Agreement, dated as of September 29, 2010, by and among the Borrower and the Lender pursuant to which the Lender purchased a Secured Convertible Debenture in the original principal amount of $475,000.00;

 

	
  

	
35.

	
Agreement, dated as of October 28, 2010, by and among the Borrower and the Lender pursuant to which the Investor purchased a Secured Convertible Debenture in the original principal amount of $400,000;

 

	
  

	
36.

	
Agreement, dated as of December 15, 2010, by and among the Borrower and the Lender pursuant to which the Investor purchased a Secured Convertible Debenture in the original principal amount of $450,000;

 

	
  

	
37.

	
Agreement, dated as of January 10, 2011, by and among the Borrower and the Lender pursuant to which the Lender purchased a Secured Convertible Debenture in the original principal amount of $450,000.00;

 

	
  

	
38.

	
Agreement, dated as of February 8, 2011, by and among the Company and the Investor pursuant to which the Investor purchased a Secured Convertible Debenture in the original principal amount of $650,000;

 

	
  

	
39.

	
Agreement, dated as of March 11, 2011, by and among the Company and the Investor pursuant to which the Investor purchased a Secured Convertible Debenture in the original principal amount of $450,000;

 

SECURITY DOCUMENTS

 

	
  

	
40.

	
Pledge and Security Agreement dated as of August 23, 2006 entered into by and between the Borrower and the Lender;

 

	
  

	
41.

	
Security Agreement dated as of March 27, 2007 entered into by and between the Obligors and the Lender;

 

	
  

	
42.

	
Security Agreement (Patent) dated as of March 27, 2007 entered into by and between the Obligors and the Lender;

 

	
  

	
43.

	
Security Agreement dated as of August 24, 2007 entered into by and between the Obligors and the Lender;

 

	
  

	
44.

	
Security Agreement (Patent) dated as of August 24, 2007 entered into by and between the Obligors and the Lender;

 

	
  

	
45.

	
Security Agreement dated as of July 29, 2008 entered into by and between the Borrower and the Lender;

 

	
  

	
46.

	
Patent Security Agreement dated as of July 29, 2008 entered into by and between the Borrower and the Lender;

 

	
  

	
47.

	
Share Pledge Agreement (Anteilsverpfandung) dated August 3, 2010 entered into by and between the Issuer and the Buyer;

 

  

  

  

	
  

	
48.

	
Agreement on the Pledge of Intellectual Property Rights as Collateral (Vereinbarung uber die Verpfandung von geistigen Eigentumsrechten) dated August 13, 2010 by and between the Buyer and NeoMedia Europe AG (“AG”);

 

	
  

	
49.

	
Security Transfer of Moveable Assets (Sicherungsubereignunsgvertrag) dated August 13, 2010 by and between the Buyer and AG;

 

WARRANTS

 

	
  

	
50.

	
“A” Warrant No. CCP-001 dated February 17, 2006 executed and delivered to the Lender by the Borrower granting the Lender the right to purchase 20,000,000 shares of the Borrower’s common stock, as amended by that certain Amendment to “A” Warrant No. CCP-001 dated as of August 23, 2006 entered into by and between the Borrower and the Lender, as further amended by that certain Amendment to “A” Warrant No.: CCP-001 dated December 29, 2006;

 

	
  

	
51.

	
“B” Warrant No. CCP-002 dated February 17, 2006 executed and delivered to the Lender by the Borrower granting the Lender the right to purchase 25,000,000 shares of the Borrower’s common stock, as amended by that certain Amendment to “B” Warrant No. CCP-002 dated as of August 23, 2006 entered into by and between the Borrower and the Lender, as further amended by that certain Amendment to “B” Warrant No.: CCP-002 dated December 29, 2006;

 

	
  

	
52.

	
“C” Warrant No. CCP-003 dated February 17, 2006 executed and delivered to the Lender by the Borrower granting the Lender the right to purchase 30,000,000 shares of the Borrower’s common stock, as amended by that certain Amendment to “C” Warrant No. CCP-003 dated as of August 23, 2006 entered into by and between the Borrower and the Lender, as further amended by that certain Amendment to “C” Warrant No.: CCP-003 dated December 29, 2006;

 

	
  

	
53.

	
“A” Warrant No. CCP-001 dated August 23, 2006 executed and delivered to the Lender by the Borrower granting the Lender the right to purchase 25,000,000 shares of the Borrower’s common stock, as amended by that certain Amendment to “A” Warrant No. CCP-001 dated as of December 29, 2006 entered into by and between the Borrower and the Lender;

 

	
  

	
54.

	
“B” Warrant No. CCP-001 dated August 23, 2006 executed and delivered to the Lender by the Borrower granting the Lender the right to purchase 50,000,000 shares of the Borrower’s common stock, as amended by that certain Amendment to “B” Warrant No. CCP-001 dated as of December 29, 2006 entered into by and between the Borrower and the Lender;

 

	
  

	
55.

	
“C” Warrant No. CCP-001 dated August 23, 2006 executed and delivered to the Lender by the Borrower granting the Lender the right to purchase 50,000,000 shares of the Borrower’s common stock, as amended by that certain Amendment to “C” Warrant No. CCP-001 dated as of December 29, 2006 entered into by and between the Borrower and the Lender;

 

	
  

	
56.

	
“D” Warrant No. CCP-001 dated August 23, 2006 executed and delivered to the Lender by the Borrower granting the Lender the right to purchase 50,000,000 shares of the Borrower’s common stock;

 

	
  

	
57.

	
“A” Warrant No. CCP-001 dated December 29, 2006 executed and delivered to the Lender by the Borrower granting the Lender the right to purchase 42,000,000 shares of the Borrower’s common stock;

 

	
  

	
58.

	
Warrant No. NEOM-4-1 dated March 27, 2007 executed and delivered to the Lender by the Borrower granting the Lender the right to purchase 125,000,000 shares of the Borrower’s common stock;

 

  

  

  

	
  

	
59.

	
Warrant No. NEOM-1-1 dated August 24, 2007 executed and delivered to the Lender by the Borrower granting the Lender the right to purchase 75,000,000 shares of the Borrower’s common stock;

 

	
  

	
60.

	
Warrant No. NEO-2008-2 dated May 16, 2008 executed and delivered to the Lender by the Borrower granting the Lender the right to purchase 7,500,000 shares of the Borrower’s common stock;

 

	
  

	
61.

	
Warrant No. NEO-2008-3 dated May 29, 2008 executed and delivered to the Lender by the Borrower granting the Lender the right to purchase 50,000,000 shares of the Borrower’s common stock;

 

	
  

	
62.

	
Warrant No. NEOM-9-1 dated July 29, 2008 executed and delivered to the Lender by the Borrower granting the Lender the right to purchase 100,000,000 shares of the Borrower’s common stock;

 

	
  

	
63.

	
Warrant No. NEOM-9-1-B dated July 29, 2008 executed and delivered to the Lender by the Borrower granting the Lender the right to purchase 100,000,000 shares of the Borrower’s common stock, as amended by that certain Amendment to NeoMedia Technologies, Inc. Warrant No. NEOM-9-1B dated as of January 5, 2010 entered into by and between the Borrower and the Lender;

 

	
  

	
64.

	
Warrant No. NEOM-9-1-C dated July 29, 2008 executed and delivered to the Lender by the Borrower granting the Lender the right to purchase 125,000,000 shares of the Borrower’s common stock, as amended by that certain Amendment to NeoMedia Technologies, Inc. Warrant No. NEOM-9-1C dated as of January 5, 2010 entered into by and between the Borrower and the Lender;

 

	
  

	
65.

	
Warrant No. NEOM-9-1-D dated July 29, 2008 executed and delivered to the Lender by the Borrower granting the Lender the right to purchase 125,000,000 shares of the Borrower’s common stock, as amended by that certain Amendment to NeoMedia Technologies, Inc. Warrant No. NEOM-9-1D dated as of January 5, 2010 entered into by and between the Borrower and the Lender;

 

	
  

	
66.

	
Warrant No. NEOM-10-1 dated January 5, 2010 executed and delivered to the Lender by the Borrower granting the Lender the right to purchase 225,000,000 shares of the Borrower’s common stock;

 

	
  

	
67.

	
Letter Agreement re: Repricing of All Existing Warrants dated August 24, 2007 entered into by and between the Borrower and the Lender;

 

	
  

	
68.

	
Warrant No.: NEOM-0510 dated May 27, 2010 executed and delivered to the Lender by the Borrower granting the Lender the right to purchase 5,000,000 shares of the Borrower’s common stock;

 

	
  

	
69.

	
Warrant No.: NEOM-0810 dated August 13, 2010 executed and delivered to the Lender by the Borrower granting the Lender the right to purchase 1,000,000 shares of the Borrower’s common stock;

 

	
  

	
70.

	
Warrant No.: NEOM-0910 dated September 29, 2010 executed and delivered to the Lender by the Borrower granting the Lender the right to purchase 750,000 shares of the Borrower’s common stock;

 

  

  

  

	
  

	
71.

	
Warrant No.: NEOM-1010 dated October 28, 2010 executed and delivered to the Investor by the Company granting the Investor the right to purchase 600,000 shares of the Company’s common stock;

 

	
  

	
72.

	
Warrant No.: NEOM-1210 dated December 15, 2010 executed and delivered to the Investor by the Company granting the Investor the right to purchase 1,250,000 shares of the Company’s common stock;

 

	
  

	
73.

	
Warrant No.: NEOM-0111 dated January 10, 2011 executed and delivered to the Lender by the Borrower granting the Lender the right to purchase 1,250,000 shares of the Borrower’s common stock;

 

	
  

	
74.

	
Warrant No.: NEOM-0112 dated February 8, 2011 executed and delivered to the Investor by the Company granting the Investor the right to purchase 1,250,000 shares of the Company’s common stock;

 

	
  

	
75.

	
Warrant No.: NEOM-0113 dated March 11, 2011 executed and delivered to the Investor by the Company granting the Investor the right to purchase 1,000,000 shares of the Company’s common stock;

REGISTRATION RIGHTS AGREEMENTS

 

	
  

	
76.

	
Lender Registration Rights Agreement dated as of February 17, 2006 entered into by and between the Borrower and the Lender, as amended by a certain First Amendment to Lender Registration Rights Agreement and as further amended by that certain Second Amendment to Lender Registration Rights Agreement dated June 15, 2006;

 

	
  

	
77.

	
Lender Registration Rights Agreement dated as of August 23, 2006 entered into by and between the Borrower and the Lender;

 

	
  

	
78.

	
Lender Registration Rights Agreement dated as of December 29, 2006 entered into by and between the Borrower and the Lender;

 

	
  

	
79.

	
Registration Rights Agreement dated as of March 27, 2007 entered into by and between the Borrower and the Lender;

 

	
  

	
80.

	
Registration Rights Agreement dated as of August 24, 2007 entered into by and between the Borrower and the Lender;

 

	
  

	
81.

	
Lender Registration Rights Agreement dated as of January 5, 2010 entered into by and between the Borrower and the Lender;

 

TRANSFER AGENT INSTRUCTIONS

 

	
  

	
82.

	
Amended and Restated Irrevocable Transfer Agent Instructions dated October 26, 2007 from the Borrower to Worldwide Stock Transfer, LLC, which amended and restated those certain Irrevocable Transfer Agent Instructions dated February 16, 2006 from the Borrower to American Stock Transfer & Trust Co.;

 

	
  

	
83.

	
Irrevocable Transfer Agent Instructions dated August 23, 2006 from the Borrower to American Stock Transfer & Trust Co.;

 

	
  

	
84.

	
Amended and Restated Irrevocable Transfer Agent Instructions dated November 21, 2007 from the Borrower to Worldwide Stock Transfer, LLC, which amended and restated those certain Irrevocable Transfer Agent Instructions dated December 29, 2006 from the Borrower to American Stock Transfer & Trust Co.;

 

  

  

  

	
  

	
85.

	
Amended and Restated Irrevocable Transfer Agent Instructions dated November 21, 2007 from the Borrower to Worldwide Stock Transfer, LLC, which amended and restated those certain Irrevocable Transfer Agent Instructions dated August 23, 2006 from the Borrower to American Stock Transfer & Trust Co.;

 

	
  

	
86.

	
Irrevocable Transfer Agent Instructions dated March 27, 2007 from the Borrower to Worldwide Stock Transfer, LLC;

 

	
  

	
87.

	
Irrevocable Transfer Agent Instructions dated August 24, 2007 from the Borrower to Worldwide Stock Transfer, LLC;

 

	
  

	
88.

	
Irrevocable Transfer Agent Instructions dated July 29, 2008 from the Borrower to Worldwide Stock Transfer, LLC;

 

	
  

	
89.

	
Irrevocable Transfer Agent Instructions dated January 5, 2010 from the Borrower to Worldwide Stock Transfer, LLC;

 

	
  

	
90.

	
Irrevocable Transfer Agent Instructions dated May 27, 2010 from the Borrower to Worldwide Stock Transfer, LLC;

 

	
  

	
91.

	
Irrevocable Transfer Agent Instructions dated August 13, 2010 from the Borrower to Worldwide Stock Transfer, LLC;

 

	
  

	
92.

	
Irrevocable Transfer Agent Instructions dated September 29, 2010 from the Borrower to Worldwide Stock Transfer, LLC;

 

	
  

	
93.

	
Irrevocable Transfer Agent Instructions dated October 28, 2010 from the Company to Worldwide Stock Transfer, LLC;

 

	
  

	
94.

	
Irrevocable Transfer Agent Instructions dated December 15, 2010 from the Company to Worldwide Stock Transfer, LLC;

 

	
  

	
95.

	
Irrevocable Transfer Agent Instructions dated January 10, 2011 from the Borrower to Worldwide Stock Transfer, LLC;

 

	
  

	
96.

	
Irrevocable Transfer Agent Instructions dated February 8, 2011 from the Borrower to Worldwide Stock Transfer, LLC;

 

	
  

	
97.

	
Irrevocable Transfer Agent Instructions dated March 11, 2011 from the Borrower to Worldwide Stock Transfer, LLC;

 

OTHER DOCUMENTS

 

	
  

	
98.

	
Blocked Account Control Agreement (“Shifting Control”) dated as of August 28, 2008 by and among the Borrower, the Lender, and JPMorgan Chase Bank, N.A.;

 

	
  

	
99.

	
Lockup Agreement dated July 28, 2008 by SKS Consulting of FL Corp. to the Lender;

 

	
  

	
100.

	
Lockup Agreement dated July 28, 2008 by James J. Keil to the Lender;

 

	
  

	
101.

	
Lockup Agreement dated July 28, 2008 by J. Scott Womble to the Lender;

 

  

  

  

	
  

	
102.

	
Pledge Shares Escrow Agreement dated March 27, 2007 between the Borrower and the Lender;

 

	
  

	
103.

	
Monitoring Fee Escrow Agreement dated January 5, 2010 by and among the Borrower, the Lender, Yorkville Advisors, LLC, and David Gonzalez, Esquire;

 

	
  

	
104.

	
Investment Agreement dated February 17, 2006 by and between the Borrower and the Lender;

 

	
  

	
105.

	
Investment Agreement dated January 5, 2010 by and between the Borrower and the Lender, as amended by that certain First Amendment to Investment Agreement dated March 5, 2010;

 

	
  

	
106.

	
Escrow Agreement dated July 29, 2008 entered into by and among the Borrower, the Lender, Yorkville Advisors, LLC, as Investment Manager, and David Gonzalez, Esq., as Escrow Agent;

 

	
  

	
107.

	
Escrow Agreement dated April 1, 2010 entered into by and among the Borrower, the Lender, Yorkville Advisors, LLC, as Investment Manager, and David Gonzalez, Esq., as Escrow Agent;

 

	
  

	
108.

	
Ratification Agreement dated as of May 27, 2010 entered into by and between the Company and the Investor;

 

	
  

	
109.

	
Ratification Agreement dated as of August 13, 2010 entered into by and between the Borrower and the Lender;

 

	
  

	
110.

	
Ratification Agreement dated as of September 29, 2010 entered into by and between the Borrower and the Lender;

 

	
  

	
111.

	
Ratification Agreement dated as of October 28, 2010 entered into by and between the Borrower and the Lender;

 

	
  

	
112.

	
Ratification Agreement dated as of December 15, 2010 entered into by and between the Borrower and the Lender;

 

	
  

	
113.

	
Ratification Agreement dated as of January 10, 2011 entered into by and between the Borrower and the Lender;

 

	
  

	
114.

	
Ratification Agreement dated as of February 8, 2011 entered into by and between the Borrower and the Lender; and

 

	
  

	
115.

	
Ratification Agreement dated as of March 11, 2011 entered into by and between the Borrower and the Lender; and

 

	
  

	
116.

	
All other documents, instruments, and agreements executed in connection with any of the foregoing.

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