NeoMedia Technologies, Inc (NEOM)

[hangdog]

I will sum up my various conversations today as:

1. The paint division is being sold at the right time to raise significant capital to prevent further share dilution . I would surmise that we will get a substantial sum of money for this company. I recommend that everyone look at the 8k closely and pay attention to paragraph 7 below. Understand that the division is on the auction block. Think bidding war.

http://www.pinksheets.com/quote/print_filings.jsp?url=%2Fredirect.asp%3Ffilename%3D0001144204%252D06...

7. No Other Offers. Neither the Seller nor the Company (or the Company’s directors, officers, employees, agents or representatives) will solicit, encourage or entertain proposals from or enter into negotiations with or furnish any nonpublic information to any other person or entity regarding the possible sale of The Division's business, assets or stock. The Seller shall deal exclusively with the Purchaser, except that Seller may solicit or entertain offers regarding a potential sale of the Division from E.I. du Pont de Nemours and Company (“DuPont”) or PPG Industries (“PPG”).

2. The redone agreement with Cornell was done because it had to be done. The share price has decreased and the warrants needed to be repriced to allow NeoMedia to have the ability to force exercising of the warrants if it needed cash. It was not done solely to give away money to Cornell. (although it effectively allows them to profit significantly as the price of NEOM surely will appreciate).

3. The focus is on the launch of Qode. The Java and Symbian versions of Qode are fully functional which is the main phone operating system in Europe. Very shortly consumers will be able to download (can already by going to http://get.qode.com) the qode system. Right now many here know about this but our major partners will be the ones that push this to the masses. Look for the initial launch in Europe. My opinion it will involve News Corp.

4. Look at last night's 8k. The Board cannot sell shares until the $5m is repaid. Based upon 1 and 3 above this will be done sooner than later. The qode business model will gain traction and become successful as the dot-mobi world goes live (starting 26 September 2006) and grows.

5. The S-3 will not feature the $100m SEDA. The S-3 will obviously not have the HipCricket funding.

6. We are finalizing discussions with the subs on a stock vs cash equity deal. So stop worrying about the $25m cash. Just worry about stock dilution. This money/stock becomes an issue the day the S-3 is declared effective by the SEC. If we file the S-3 tommorrow it may take 3 to 6 months to become effective. Based on the sale of paint, the launch of qode and the continued lessening of our cash burn rate the amount of shares being diluted will be that much less as our share price rises.

7. The HipCricket deal was dissolved mutually.

8. The Board listened to us at the last ASM. Those attending DEMANDED that all possible things be done to prevent further share dilution and to go cash flow positive. Besides the dealings with Cornell and the warrants, management has chosen to put the paint division up for sale. Why? To prevent further share dilution. The money raised from this sale will be used to fund the launch of qode. As qode gains traction over the next year, we will be able to divest ourselves of entities like Cornell.

What does hangdog think: Don't sell your NeoMedia shares just before we are in the homestretch for the launching of a new business/marketing model that will be in my opinion quite successful. That’s why I bought more just before the close. Thanks to all who sold to drive the price down to .132.

Lastly, why did I spend 8 out of the last 24 hours on the phone talking to people at NeoMedia, other shareholders, MicroPaint employees, etc. It’s because I want to judge the future of this company and why decisions were made and how they were made. The few paragraphs above CANNOT summarize everything that we discussed and what I have learned. If you have specific questions for me please send an email to me. I may not respond immediately but will do my very best to in the next 24 ours. Right now I need to take a break and spend time with my family.

Take care,
Alan