8-K

U.S. SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_______________________________

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of Earliest Event Reported): October 30, 2007

NEOMEDIA TECHNOLOGIES, INC.

(Exact Name of Registrant as Specified in its Charter)

Delaware	0-21743	36-3680347
(State or Other Jurisdiction Incorporation)	(Commission File Number)	(IRS Employer Identification No.)
2201 Second Street, Suite 600, Fort Myers, Florida		33901
(Address of Principal Executive Offices)		(Zip Code)
	(239) - 337-3434
	(Registrant's Telephone Number, including Area Code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

ITEM 1.01. ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT

ITEM 2.01. COMPLETION OF ACQUISITION OR DISPOSITION OF ASSETS

Disposition of Ownership Of Triton Global Business Services, Inc.

On March 21, 2006, NeoMedia Technologies, Inc. (“NeoMedia”) (OTCBB:NEOM) acquired all of the outstanding common shares of BSD Software Inc. (“BSD”), in exchange for 7,123,698 shares of NeoMedia common stock, valued at $0.3467. Pursuant to the terms of the merger, BSD was merged with and into NeoMedia Telecom Services, Inc., a wholly-owned subsidiary of NeoMedia, and on March 21, 2006 began operating as the NeoMedia Telecom Services Business Unit. Through the acquisition of BSD, NeoMedia acquired 8,080,000 shares, representing 90.19% ownership, of common stock of Triton Global Business Services, Inc. (“Triton”), a provider of live and automated operator calling services and e-business support, including billing, clearinghouse and information management services, to companies in the telecommunications industry. The operations of Triton comprised 100% of the operations of BSD before the transaction and NeoMedia Telecom Services after the transaction. The acquisition of BSD by NeoMedia was transacted for the purpose of acquiring these operations.

On October 30, 2007, NeoMedia completed the sale of its 8,080,000 shares of Triton to Greywolf Entertainment, Inc., a Canadian company (the “Buyer”), for $1,350,000 cash. NeoMedia also issued 6,190,476 shares of its common stock to the principal shareholder and CEO of the Buyer as additional consideration in the transaction. Due to the fact that Triton comprised 100% of the operations of NeoMedia’s Telecom Services business unit, as a result of the sale of all of its shares of Triton NeoMedia discontinued the operations of its Telecom Services business unit effective with the sale.

Guy Fietz, who was the Vice President and General Manager of the NeoMedia Telecom Services business unit since the acquisition of BSD and Triton by NeoMedia, and was also the principal shareholder and Chief Executive Officer of BSD prior to its acquisition by NeoMedia, is also the principal shareholder and CEO of the Buyer.

For purposes of this Form 8-K, any reference to the sale or discontinuation of Triton, BSD, or Telecom Services should be construed as referring to the transaction described above.

The Agreement is attached hereto as exhibit 10.1.

ITEM 2.06. MATERIAL IMPAIRMENTS

As a result of the completion of the sale of the Telecom Services business unit, NeoMedia compared the fair value of assets received in the sale to the carrying value of the asset group associated with this business. Accordingly, NeoMedia expects to record an impairment charge relating to the Telecom Services business unit asset group in the amount of $3,378,000 during the three months ended September 30, 2007. NeoMedia does not expect the impairment charge to result in any future cash expenditures.

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ITEM 9.01. FINANCIAL STATEMENTS, PRO FORMA INFORMATION AND EXHIBITS

Pro Forma Financial Information

Notes to Unaudited Pro Forma Condensed Combined Financial Statements

1. Basis of Presentation

Current Transaction

On October 26, 2007, NeoMedia completed the sale of 8,080,000 shares of Triton to the Buyer for $1,350,000 cash. The operations of Triton comprised 100% of the operations of NeoMedia’s Telecom Services business unit, which was acquired through the purchase by NeoMedia of BSD, and its operating subsidiary Triton, on March 21, 2006.

Other Acquisitions and Dispositions

In addition to the acquisition of BSD and the sale of Triton shares, the following acquisitions and dispositions have occurred since January 1, 2006, and are reflected in the pro forma financial statements presented herein:

Acquisition of Gavitec AG

On February 17, 2006, NeoMedia and Gavitec AG (“Gavitec”) of Wuerselen, Germany, signed a definitive sale and purchase agreement, subject to closing conditions, under which NeoMedia acquired all of the outstanding shares of Gavitec in exchange for $1,800,000 cash and 13,660,511 shares of NeoMedia common stock, calculated by dividing $5,400,000 by the volume-weighted average closing price of NeoMedia common stock for the ten days up to and including February 16, 2006. On February 23, 2006, NeoMedia and Gavitec completed the closing requirements and the acquisition became effective.

Acquisition and Disposition of 12Snap AG

On February 28, 2006, NeoMedia acquired all of the outstanding shares of 12Snap AG (“12Snap”) in exchange for $2,500,000 cash and $19,500,000 in stock, represented by 49,294,581 shares of NeoMedia common stock. On April 4, 2007, NeoMedia reached an agreement with an independent buyer (the “12Snap Buyer”), pursuant to which the 12Snap Buyer purchased from NeoMedia 90% of the shares of 12Snap, subject to the following material terms and conditions:

· $1,100,000 was paid in cash at closing, and $500,000 was placed into an escrow account for 90 days to secure warranty claims;

· The 12Snap Buyer waived his portion of the Purchase Price Guarantee Obligation in the amount of $880,000;

· The 12Snap Buyer returned to NeoMedia 2,525,818 NeoMedia shares previously issued to Buyer;

· 12Snap management waived their portion of the Purchase Price Guarantee Obligation in the amount of $880,000;

· 12Snap management returned to NeoMedia 2,525,818 shares of NeoMedia common stock previously issued to 12Snap management;

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· NeoMedia will retain a 10% ownership in 12Snap, subject to an option agreement pursuant to which NeoMedia has the right to sell and Buyer has the right to acquire the remaining 10% stake held by NeoMedia for a purchase price of $750,000 after December 31, 2007;

· 12Snap and NeoMedia will execute a cooperation agreement pursuant to which 12snap will remain NeoMedia preferred partner and enjoy most favored prices, and 12snap will perform certain research and development functions for NeoMedia; and

Mobot, Inc. and Sponge Ltd.

On February 17, 2006, NeoMedia acquired all of the outstanding shares of Mobot, Inc. (“Mobot”) in exchange for $3,500,000 cash and $6,500,000 in stock, represented by 16,931,493 shares of NeoMedia common stock. On February 23, 2006, NeoMedia acquired all of the outstanding shares of Sponge Ltd. (“Sponge”) in exchange for $6,141,000 cash and $13.1 million in stock, represented by 33,097,135 shares of NeoMedia common stock.

On November 14, 2006, NeoMedia divested of 92.5% of its ownership interest in Mobot. On December 6, 2006, NeoMedia sold 82% of its ownership interest in Sponge. Because the acquisition and disposition of Mobot and Sponge occurred during the year ended December 31, 2006, the results of these entities are not shown separately in these pro forma financial statements.

Historical Financial Statements

Audited financials statements for BSD were included in amendment no. 2 to form 8-K filed with SEC on June 8, 2007. Audited financials statements for 12Snap were included in amendment no. 1 to form 8-K filed with SEC on May 8, 2006. Audited financials statements for Gavitec were included in amendment no. 1 to form 8-K filed with SEC on May 8, 2006. Audited financials statements for Mobot were included in amendment no. 1 to form 8-K filed with SEC on May 3, 2006. Audited financials statements for Sponge were included in amendment no. 2 to form 8-K filed with SEC on June 21, 2006.

The historical balance sheets of BSD, Gavitec, and 12Snap as of December 31, 2006 are included in NeoMedia’s consolidated balance sheet as of December 31, 2006 as reported on form 10-K. Since Sponge and Mobot were sold prior to December 31, 2006, the historical balance sheets of these entities are not included in NeoMedia’s consolidated balance sheet as of December 31, 2006.

The results of operations of Gavitec, 12 Snap and BSD are included from the respective acquisition date of each company through December 31, 2006 in NeoMedia’s consolidated results of operations for the year ended December 31, 2006 as reported on form 10-K. Results of operations of Mobot and Sponge are included from the respective acquisition date of each company through the respective sale date of each company in NeoMedia’s consolidated results of operations for the year ended December 31, 2006 as reported on form 10-K, under the caption, “Loss from discontinued operations.” 12Snap balance sheet as of December 31, 2006, and 12Snap, Mobot, Sponge, Gavitec, and BSD statements of operations for the year ended December 31, 2006 are shown in this filing for pro forma purposes only.

Presentation

The unaudited pro forma condensed combined balance sheet as of June 30, 2007 gives effect to the disposition of the Telecom Services business as if it had occurred as of June 30, 2007.

The unaudited pro forma condensed combined historical statement of operations for the six months ended June 30, 2007 gives effect to the dispositions of the Telecom Services and 12Snap businesses as if they had occurred as of June 30, 2007. Since both Telecom Services and 12Snap are classified as discontinued operations in NeoMedia’s historical statement of operations for the six months ended June 30, 2007, there are no pro forma

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adjustments to NeoMedia’s loss from continuing operations. The weighted average number of shares outstanding during the six months ended June 30, 2007 was adjusted to reflect shares that were issued in connection with the sale of Telecom Services and returned to NeoMedia and retired in connection with the sale of 12Snap.

The unaudited pro forma condensed combined historical statement of operations for the year ended December 31, 2006 gives effect to the acquisitions of 12Snap and Gavitec as if they had occurred as of January 1, 2006, combining the historical results of NeoMedia for the year ended December 31, 2006 with the historical results of each entity for the year ended December 31, 2006. The acquisition and disposition of Telecom Services, Sponge and Mobot are assumed to have occurred on January 1, 2006, such that the net effect of the acquisition and disposition of each entity on the pro forma consolidated results of operations for the year ended December 31, 2006 is zero. Telecom Services operations for the year ended December 31, 2006 are shown separately in the pro forma statement of operations for informational purposes only.

The unaudited pro forma combined financial statements included in this filing have been prepared by the managements of NeoMedia, Gavitec, 12Snap, and BSD without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations. However, the managements of NeoMedia, Gavitec, 12Snap, and BSD believe that the disclosures are adequate to make the information not misleading.

The pro forma adjustments are based on currently available information and upon estimates and assumptions that we believe are reasonable under the circumstances. The unaudited pro forma financial data do not purport to represent what NeoMedia’s financial position or results of operations would actually have been if such transactions had occurred on those dates and are not necessarily representative of NeoMedia’s financial position or results of operations for any future period. The unaudited pro forma financial statements should be read in conjunction with the separate historical financial statements and footnotes of NeoMedia included in Form 10-K for the year ended December 31, 2006, with the separate historical financial statements and footnotes of Mobot for the years ended December 31, 2005 and 2004 (included in Form 8-K/A filed with the SEC on May 3, 2006), with the separate historical financial statements and footnotes of Sponge for the years ended September 30, 2005 and 2004 (included in Form 8-K/A filed with the SEC on June 21, 2006), with the separate historical financial statements and footnotes of Gavitec for the years ended December 31, 2005 and 2004 (in Form 8-K/A filed with the SEC on May 8, 2006), with the separate historical financial statements and footnotes of 12Snap for the years ended December 31, 2005 and 2004 (included in Form 8-K/A filed with the SEC on May 8, 2006), and with the separate historical financial statements and footnotes of BSD for the years ended December 31, 2005 and 2004 (included in Form 8-K/A filed with the SEC on June 8, 2007).

2. Preliminary Price Allocation

A final determination of the allocation of the sale of the assets and liabilities of Telecom Services has not been made. The allocation reflected in the unaudited pro forma combined financial statements is based on management’s best judgment and estimate of the accounting treatment of the transaction, and should be considered preliminary. The final allocation could differ materially from the pro forma allocation included herein.

3. Pro forma Net Loss Per Share

The pro forma basic and dilutive net loss per share are based on the pro forma weighted average number of shares of NeoMedia's common stock as if the shares issued to acquire Gavitec, 12Snap, BSD, Mobot and Sponge had been issued at the beginning of the period shown. Shares issued and returned to NeoMedia in connection with the Sponge and 12Snap transactions are assumed to have been issued and retired at the beginning of the period shown. Shares issued in connection with the sale of BSD are assumed to have been issued at the beginning of the period shown. Dilutive shares are not included in the computation of pro forma dilutive net loss per share as their effect would be anti-dilutive.

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NeoMedia Technologies, Inc.

Unaudited Pro-forma Condensed Combined Balance Sheet

June 30, 2007

(In thousands of US Dollars)

				Pro-forma Adjustments
	(A)			(B)			(C)
				NeoMedia			Other
				Telecom			Pro-forma				Pro-forma
ASSETS	NeoMedia			Services			Services				Consolidated
Current assets:	(unaudited)			(unaudited)			(unaudited)				(unaudited)
Cash and cash equivalents	$	151		$	—		$	1,350		(D)	$	1,501
Trade accounts receivable, net		265			—			—				265
Other receivables		732			—			—				732
Inventories, net		280			—			—				280
Investment in marketable securities		14			—			—				14
Prepaid expenses and other current assets		186			—			—				186
Assets held for sale		10,820			(7,562	)		—				3,258
Total current assets		12,448			(7,562	)		1,350				6,236
Leasehold improvements and property and equipment, net		150			—			—				150
Goodwill		3,418			—			—				3,418
Capitalized patents, net		2,689			—			—				2,689
Proprietary software, net		3,770			—			—				3,770
Other intangible assets, net		44			—			—				44
Cash surrender value of life insurance policy		925			—			—				925
Other long-term assets		3,705			—			—				3,705
Total assets	$	27,149			($7,562	)	$	1,350			$	20,937
LIABILITIES AND SHAREHOLDERS’ DEFICIT
Current liabilities:
Accounts payable	$	2,976		$	—		$	—			$	2,976
Liabilities held for sale		3,446			(3,055	)		—				391
Taxes payable		5			—			—				5
Accrued expenses		3,404			—			143		(E)		3,547
Deferred revenues and customer prepayments		347			—			—				347
Notes payable		15			—			—				15
Accrued purchase price guarantee		4,684			—			—				4,684
Derivative financial instruments		24,112			—			—				24,112
Deferred tax liability		587			—			—				587
Debentures payable		18,801			—			—				18,801
Series C Convertible preferred stock		21,377			—			—				21,377
Intercompany amounts		—			(5,670	)		5,670				—
Total liabilities		79,754			(8,725	)		5,813				76,842
Shareholders’ deficit:
Common stock (H)		9,002			—			37		(F)		9,039
Additional paid-in capital		114,846			—			93		(F)		114,939
Accumulated deficit		(175,026	)		990			(4,593	)	(G)		(178,629	)
Accumulated other comprehensive loss		(648	)		173			—				(475	)
Treasury stock		(779	)		—			—				(779	)
Total shareholders’ deficit		(52,605	)		1,163			(4,463	)			(55,905	)
Total liabilities and shareholders’ deficit	$	27,149			($7,562	)	$	1,350			$	20,937

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Pro-forma Adjustments

(A)  - Represents NeoMedia historical consolidated balance sheet as of June 30, 2007

(B)  - Represents NeoMedia Telecom Services historical balance sheet as of June 30, 2007. Since this business was considered a discontinued operation for the purpose of reporting NeoMedia's consolidated financial results for the period ended June 30, 2007, assets and liabilities of this business unit were classified as held for sale on NeoMedia's consolidated balance sheet.

(C)  - Pro forma adjustments to record estimated fair value of assets received in connection with sale of Triton shares

(D)  - Adjustment to reflect $1,350,000 cash received at closing.

(E)  - Adjustment to accrue potential commission payable on sales price

(F)  - Adjustment to record common stock issued by NeoMedia to the principal of Buyer for $130,000 as part of the sale transaction. The pro forma number of shares (3,714,286) was calculated using a NeoMedia share price of $0.035, which was the average closing price for the three days preceding June 30, 2007, the pro forma transaction date.

(G)  - Adjustment to (i) record pro forma loss on disposal of Triton shares of $3,603,000, based on net fair value of consideration received and carrying value of asset group, and (ii) back out Telecom Services deficit accumulated since acquisition in the amount of $990,000, which is reflected in the previous column. NeoMedia recorded an impairment charge during the third quarter of 2007 in the amount of $2,915,000 to write the asset group down to the expected fair value of proceeds received in the sale.

(H)  - Common stock, $0.01 par value, consists of 5,000,000,000 shares authorized. On a historical basis, there were 901,823,027 shares issued and 900,181,681 shares outstanding as of June 30, 2007. On a pro forma basis, there were 905,537,313 shares issued and 903,895,967 shares outstanding as of June 30, 2007.

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NeoMedia Technologies, Inc.

Unaudited Pro-forma Combined Condensed Statement of Operations

For the Six Months Ended June 30, 2007

(In thousands of US Dollars, except per share data)

	(A)			(B)
				Pro				Pro
				Forma				Forma
	NeoMedia			Adjustments				Consolidated
	(unaudited)			(unaudited)				(unaudited)
Net sales	$	1,023		$	—			$	1,023
Cost of sales		687			—				687
Gross profit		336			—				336
Selling, general and administrative expenses		1,402			—				1,402
Research and development costs		3,764			—				3,764
Impairment charge		925			—				925
Loss from operations		(5,755	)		—				(5,755	)
Gain on extinguishment of debt, net		253			—				253
Loss on derivative financial instruments		(2,386	)		—				(2,386	)
Interest income (expense), net		(2,655	)		—				(2,655	)
Loss before provision for income taxes		(10,543	)		—				(10,543	)
Provision for income taxes		—			—				—
Loss from continuing operations		($10,543	)	$	—				($10,543	)
Loss per shares from continuing operations -- basic and diluted		($0.01	)						($0.01	)
Weighted average number of common shares-basic and diluted		789,247,203			(5,343,450	)	(C)		783,903,753

Pro-forma Adjustments

(A)  - Derived from NeoMedia's unaudited interim financial statements for the six months ended June 30, 2007

(B)  - Since operations of the Telecom Services and 12 Snap business units were classified as discontinued operations in NeoMedia's consolidated financial statements for the six months ended June 30, 2007, no pro forma adjustments are required to adjust NeoMedia's loss from continuing operations assuming the disposition of each entity occurred on January 1, 2007.

(C)  - Adjustment to record (i) 2,407,407 shares ($130,000) of common stock issued by NeoMedia to the Buyer as consideration in the sale of Triton, calculated using a NeoMedia share price of $0.054, which was the average closing price for the three days preceding January 1, 2007, the pro forma transaction date, and (ii) 7,750,857 shares retired in connection with the sale of 12Snap.

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NeoMedia Technologies, Inc.

Unaudited Pro-forma Combined Condensed Statement of Operations

For the Year Ended December 31, 2006

(In thousands of US Dollars, except per share data)

	(A)			(B)			(C)			(C)			(D)
							Acquisition			Disposition			Pro				Pro
				12Snap			NeoMedia			NeoMedia			Forma				Forma
	Neo-			and			Telecom			Telecom			Adjust-				Consol-
	Media			Gavitec			Services			Services			ments				idated
				(unaudited)			(unaudited)			(unaudited)			(unaudited)				(unaudited)
Net sales	$	10,309		$	2,306		$	1,723			($1,723	)		($1,371	)		$	11,244
Cost of sales		3,863			1,525			—			—			105				5,493
Gross profit		6,446			781			1,723			(1,723	)		(1,476	)			5,751
Selling, general and administrative expenses		22,364			1,111			2,739			(2,739	)		(2,244	)			21,231
Research and development costs		3,522			252			—			—			—				3,774
Impairment charge		18,706			—			—			—			—				18,706
Loss from operations		(38,146	)		(582	)		(1,016	)		1,016			768				(37,960	)
Loss on extinguishment of debt, net		(1,879	)		—			—			—			—				(1,879	)
Other loss		(2,434	)		—			—			—			—				(2,434	)
Write off of deferred equity financing costs		(13,256	)		—			—			—			—				(13,256	)
Gain on derivative financial instruments		13,645			—			—			—			—				13,645
Interest income (expense), net		(10,182	)		(43	)		26			(26	)		2				(10,223	)
Loss before provision for income taxes		(52,252	)		(625	)		(990	)		990			770				(52,107	)
Provision for income taxes		—			—			—			—			—				—
Loss from continuing operations		($52,252	)		($625	)		($990	)	$	990		$	770				($52,107	)
Loss per shares from continuing
operations -- basic and diluted		($0.09	)															($0.08	)
Weighted average number
of common shares-basic and diluted		613,560,070												57,917,053		(E)		671,477,123

Pro-forma Adjustments

(A)  - Derived from audited interim financial statements for the year ended December 31, 2006

(B)  - Results of Gavitec and 12Snap were included in NeoMedia's historical consolidated results for the year ended December 31, 2006 as follows: Gavitec (February 24 - December 31) and 12Snap (March 1 - December 31). This columns reflects the results of operations of these acquired entities for the period from January 1, 2006 through the acquisition date of each entity. It is important to note that results of operations of subsidiaries Mobot and Sponge are not shown for pro forma purposes. Since each entity was acquired and disposed of during the year ended December 31, 2006, the net effect for pro forma purposes on the results of operations is zero. The results from Mobot and Sponge have therefore been eliminated of repurposes of this pro forma statement of operations.

(C)  - For pro forma purposes, acquisition of NeoMedia Telecom Services and the discontinuation of the business resulting from NeoMedia's sale of its ownership interest in Triton, are assumed to have occurred on January 1, 2006. As a result, there is no net effect on the pro forma consolidated statement of operations from these transactions. The results of the Telecom Services business are shown separately for presentation purposes only.

(D)  - Pro forma adjustments are to (i) remove results of operations for Telecom Services included in NeoMedia's results of operations for the period from March 21, 2006 (date of acquisition) through December 31, 2006, and (ii) reflect additional amortization of acquired intangible assets for the period from January 1, 2006 through the actual acquisition dates of Gavitec and 12Snap in the amount of $88,000 and $143,000, respectively.

(E)  - Adjustment to increase the number of shares included in NeoMedia's actual weighted average shares outstanding for the year ended December 31, 2006 to the weighted average number of shares that would have been outstanding for pro forma purposes if the acquisitions of Telecom Services, 12Snap, Gavitec, Mobot, and Sponge, and the dispositions of Telecom Services, Mobot and Sponge, had occurred on January 1, 2006. Acquisition and sale prices are calculated based on the stock price around January 1, 2006.

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EXHIBIT INDEX

Exhibit No.	Description
10.1	Sale and Purchase Agreement between NeoMedia and Greywolf Entertainment, Inc.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date:November 5, 2007	NEOMEDIA TECHNOLOGIES, INC.
	By:	/s/ William J. Hoffman
		Name:William J. Hoffman
		Its:Chief Executive Officer

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EX-10.1

SHARE PURCHASE AGREEMENT

THIS AGREEMENT is made as of the 26^th day of October, 2007,

AMONG

NEOMEDIA TECHNOLOGIES INC.

(the “Parent”)

and

NEOMEDIA TELECOM SERVICES INC.

(the “Vendor”)

and

GREYWOLF ENTERTAINMENT INC.

(the “Purchaser”)

WHEREAS the Vendor is a wholly-owned subsidiary of the Parent; and

WHEREAS the Vendor is the registered owner of ninety (90%) percent of the issued and outstanding shares in the capital stock of Triton Global Business Services Inc. (the "Corporation"), as described in Schedule A hereto (the "Shares");

AND WHEREAS the Corporation owes certain debts to the Parent, in the aggregate amount of $1,948,309.36, and having the particulars described in Schedule B hereto (collectively, the "Loans");

AND WHEREAS the Purchaser desires to purchase the Shares from the Vendor, and to assume the Loans;

AND WHEREAS the Vendor desires to sell the Shares to the Purchaser, and Parent desires to assign the Loans to the Purchaser;

NOW THEREFORE THIS AGREEMENT WITNESSETH THAT in consideration of the covenants, agreements and payment herein provided, the parties hereto hereby covenant and agree as follows:

1. The Vendor hereby represents and warrants to the Purchaser that it is the registered and beneficial owner of the Shares, as described in Schedule A hereto.

2. On the terms and subject to the conditions herein set out, the Parent shall cause the Vendor to sell to the Purchaser, and the Purchaser shall purchase from the Vendor, the Shares, and the Parent shall assign to the Purchaser and the Purchaser shall assume the Loans, all effective October 26, 2007 (the “Closing Date”).

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3. The Purchaser will pay the sum of One Million U.S. Dollars (US$1,000,000.00) for the Shares (the “Purchase Price”) to the Parent, by cash, certified cheque or solicitor's trust cheque.

4. The Purchaser shall assume the Loans, and the Parent shall assign the Loan to the Purchaser. The Purchaser shall pay the sum of Three Hundred Fifty Thousand U.S. Dollars (US$350,000.00) (the "Loan Amount")to the Parent by cash, certified cheque or solicitor's trust cheque.

5. The Purchaser shall assume all past, present and future liabilities of the Corporation, which liabilities are fairly and accurately represented on those financial statements of the Corporation previously provided by the Parent to the Purchaser (the “Financial Statements”). The Purchaser shall also assume liability for any outstanding claims, suits or actions pending or threatened against the Corporation.

6. The Vendor and the Parent hereby represent and warrant, to the best of their knowledge, to the Purchaser as follows:

(a) the Shares are solely owned by the Vendor as the registered owner, with a good and marketable title thereto, free and clear of all mortgages, liens, charges, security interests, adverse claims, pledges, encumbrances and demands whatsoever, except as described in Schedule C;

(b) the authorized capital of the Corporation is described in Schedule A, and all of the shares in the capital stock of the Corporation have been duly and validly issued and are outstanding as fully paid and non-assessable, and are registered on the books of the Corporation in the names of the persons holding such shares;

(c) the Parent and the Vendor have the necessary power and authority to enter into and perform their obligations under this Agreement;

(d) no person, firm or corporation other than the Purchaser has any agreement or option or any right or privilege (whether by law, pre-emptive or contractual) capable of becoming an agreement or option for the purchase from the Parent or the Vendor of the Shares;

(e) the Shares shall at the Closing Date be effectively transferred to the Purchaser free and clear of any actual or threatened liens, charges, pledges, hypothecations, claims, set-offs, options, calls, reservations, liabilities, security interests or encumbrances of any nature or kind whatsoever;

(f) the Loans are bona fide debt obligations of the Corporation owing to the Parent for monies actually advanced by the Parent to the Corporation, the Corporation had all necessary authorizations to enter into the Loans with the Parent, the Loans are not in default, the Loans have not been settled, compromised or waived, and are good and collectible debts of the Parent at the face value thereof;

(g) the Parent has the right to assign the Loans to the Purchaser, and the Corporation has been notified of, and provided its consent to such assignment;

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(h) the execution and delivery of this Agreement by the Parent and the Vendor and the consummation of the transactions contemplated hereby shall not result in a breach of any of the terms or conditions of or constitute default under any contract, agreement, commitment, indenture, mortgage, note, bond, license or other instrument or obligation to which the Parent or the Vendor is now a party or by which the Parent or the Vendor or any of the Shares or Loans may be bound or affected;

(i) this Agreement has been duly executed and delivered by the Parent and the Vendor and this Agreement and each of the documents delivered pursuant hereto constitutes, or will, at the time of execution and delivery by the Parent and the Vendor, constitute, valid and binding obligations of the Parent and the Vendor, enforceable in accordance with its terms

(j) the Corporation is duly incorporated, organized and is validly existing in good standing under the laws of Canada and has all necessary corporate power, authority and capacity to own or lease its property and assets and to carry on its business as presently conducted by it. No proceedings have been taken or authorized by the Corporation, or by any other person, with respect to the bankruptcy, insolvency, liquidation, dissolution or winding up of the Corporation or with respect to any amalgamation, merger, consolidation, arrangement or reorganization relating to the Corporation. The Corporation possesses all licences required to be maintained by the Corporation and material to the conduct of the business as presently carried on by the Corporation;

(k) with the exception of its ownership interest in Triton Global Communications, Inc., the Corporation has no subsidiaries and owns no shares in the capital of any other corporation and has not agreed to acquire any shares in the capital of any other corporation.

(l) the minute book for the Corporation is complete and accurate and contains complete copies of all resolutions passed, meeting held and actions taken by the directors and shareholders of the Corporation as of the date hereof. All meetings held and resolutions passed were duly held, notice was given or waived in accordance with applicable law, the constating documents and by-laws of the Corporation, and quorum was present. The minute book for the Corporation contains complete and accurate registers of shareholders, officers and directors of the Corporation. The directors and officers of the Corporation have been duly and validly elected or appointed;

(m) no dividends have been declared or paid on or in respect of any of the shares of the Corporation and no other distribution on any of its securities or shares has been made by the Corporation since the date of the Financial Statements save and except as disclosed in writing to the Purchaser. All dividends which, to the date of this Agreement, have been declared by the Corporation have been duly and validly declared and paid in full and there remains no outstanding obligation in respect thereof;

(n) the property and assets of the Corporation are owned beneficially by the Corporation as the legal and beneficial owner thereof, with a good and

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marketable title thereto, free and clear of all liens, charges and encumbrances, except as described in Schedule C;

(o) the Corporation has the right to use its name, and is the legal and beneficial owner of all trade-marks, patents, copyright and other intellectual property used by the Corporation in its business, free and clear of all liens, charges and encumbrances, and is not a party to or bound by any agreement or any other obligation whatsoever that limits or impairs its ability to sell, transfer, assign or convey, or that otherwise affects, such intellectual property, except as described in Schedule C. The Corporation is not infringing upon the industrial or intellectual property rights, domestic or foreign, of any other person.

(p) the Parent and the Vendor have disclosed to the Purchaser all material contracts and agreements to which the Corporation is a party or by which it is bound, and the Corporation is in compliance, in all material respects, with the terms of each such material contract including, without limitation, with all obligations to expend monies or to perform work and there has occurred no event which would constitute any material default or breach by the Corporation. The Corporation has the capacity, including the necessary personnel, equipment and supplies (subject to ordinary hiring and purchasing requirements), to perform all of its obligations under such contracts and agreements.

(q) the Corporation maintains such policies of insurance, issued by responsible insurers, as are appropriate to its business and assets, and against such risks as are customarily carried and insured against by owners of comparable businesses and assets, which policies are all in full force and effect, and the Corporation is not in material default, whether as to the payment of premium or otherwise, under the terms of any such policy;

(r) as of the Closing Date:

i. there are no actions, suits or proceedings pending or threatened, before or by any federal, provincial, municipal or other governmental department, commission, board, bureau, agency or instrumentality, domestic or foreign entity;

ii. there are no existing grounds on which any such action, suit or proceeding might be commenced with any reasonable likelihood of success;

(s) the Corporation has not made any guarantees, assurances, indemnities or otherwise guaranteed or promised to make payment for the debts of any other person or entity;

(t) the Corporation has duly filed all reports or returns with respect to income, capital, sales, goods and services, excise, business and property tax and all other taxes or customs duties required to be filed by it and has paid all taxes, governmental charges, penalties, interest and fines due and payable by the Corporation up to the date hereof. The Corporation has paid as and when required by law all tax instalments due or alleged to be due up to the date

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hereof. The Corporation has made adequate provision for the taxes which are payable during the fiscal period(s) for which tax returns are not yet required to be filed;

(u) the accounts receivable shown on the Financial Statements either have been collected or are good and collectible at the aggregate recorded amounts thereof, except to the extent of any reserves provided for such accounts in the Financial Statements as adjusted in the ordinary and usual course of business.

(v) the Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America and fairly and accurately represent the financial condition and all assets and liabilities of the Corporation; and

(w) the books and records, financial, corporate and otherwise, of the Corporation fairly and correctly set out and disclose in all material respects the financial position of the Corporation as at the date hereof and all material financial transactions of the Corporation have been accurately recorded in such books and records. There has been no change in the operation, affairs or condition of the Corporation since date of the Financial Statements.

7. The Purchaser hereby represents and warrants to the Parent and Vendor as follows:

(a) the execution and delivery of this Agreement by the Purchaser and the consummation of the transactions contemplated hereby shall not result in a breach of any of the terms or conditions of or constitute default under any contract, agreement, commitment, indenture, mortgage, note, bond, license or other instrument or obligation to which the Purchaser is now a party or by which the Purchaser is bound;

(b) the Purchaser is not a non-Canadian within the meaning of the Investment Canada Act (Canada); and

(c) this Agreement has been duly executed and delivered by the Purchaser and this Agreement and each of the documents delivered pursuant hereto constitutes, or will, at the time of execution and delivery by the Purchaser, constitute, valid and binding obligations of the Purchaser, enforceable in accordance with its terms.

8. The representations and warranties contained herein will survive the completion of the purchase and sale of the Shares and the assignment and the assumption of the Loans notwithstanding such completion nor any investigation made by or on behalf of the Purchaser and will continue in full force and effect for the benefit of the Purchaser for a period of one (1) year from the Closing Date. Notwithstanding the foregoing, the representations set forth in paragraph 6(t) will continue for the period during which the applicable taxing authority has the right to issue a re-assessment.

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9. On the Closing Date, the Parent or the Vendor, as applicable, shall deliver to the Purchaser:

(a) certificates respecting all the Shares, duly endorsed in blank for transfer, and will cause transfers of such shares to be duly and regularly recorded in the name of the Purchaser, or its nominee(s);

(b) an executed copy of a non-competition agreement and non-solicitation covenant, in form satisfactory to the Purchaser, prohibiting the Parent and the Vendor, directly or indirectly, in any manner whatsoever, from competing with the Corporation within Canada and the United States for a period of one (1) year following Closing Date with any business of the Corporation, other than with respect to cellular services. The Parent and the Vendor shall also agree not to solicit or otherwise divert employees, customers or suppliers of the Corporation and not to use any of the Corporation's confidential or proprietary information;

(c) evidence of pending issuance of certificates representing shares of the Parent, registered in the name of Guy Fietz, or his nominee, on the Closing Date, of that number of shares of restricted common stock of the Parent having a market value of One Hundred Thirty Thousand U.S. Dollars ($130,000.00), based on the average closing price of such shares on the Over-the-Counter Bulletin Board for the seven (7) days prior to the Closing Date. A copy of a letter of instruction to the Parent’s stock transfer agent, along with proof of delivery of such letter of instruction, shall constitute satisfactory evidence of pending issuance on the Closing Date;

(d) an executed copy of resolutions of the board of directors of the Parent and the Vendor authorizing all matters contemplated herein,

(e) possession of all premises occupied by the Corporation together with all keys and any alarm codes in respect thereto; and

(f) all of the Corporation's books and records of every nature and kind whatsoever and all original copies of documents, including, without limitation, all contracts, insurance policies, minute books and copies of all income tax returns filed by the Corporation and supporting documents thereto, wherever such books, records and documents may be situated and in whatever form or terms they may be stored in.

10. The Parent and the Vendor shall jointly and severally indemnify and save harmless the Purchaser from all claims, actions, damages or losses suffered or incurred by the Purchaser as a result of or arising directly or indirectly out of or in connection with:

(a) any breach by the Parent or the Vendor of, or any inaccuracy of, any representation or warranty of the Parent or the Vendor contained in this Agreement or in any agreement, certificate or other document delivered pursuant hereto; and

(b) any breach or non-performance by the Parent or the Vendor of any covenant to be performed by them that is contained in this Agreement or in any agreement, certificate or other document delivered pursuant hereto.

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The indemnity shall be limited to an amount of One Million Three Hundred Fifty Thousand U.S. Dollars (US$1,350,000.00).

11. The Purchaser shall be entitled to apply, on behalf of the Vendor, for a certificate pursuant to section 116 of the Income Tax Act (Canada), in respect of tax payable by the Vendor on the sale of the Shares. The Vendor shall execute all such authorizations and other documents as may be reasonably required by the Purchaser, and shall grant the Purchaser access to its books, records and information to enable the Purchaser to complete the application. The Vendor shall be responsible for the payment of any Corporate Income tax (if any) arising from the sale of the Shares by the Vendor to the Purchaser, related to Vendor’s gain or loss on the sale of stock transaction on the Vendor’s books of record.

12. Notwithstanding the closing of the transactions contemplated herein, thirty percent (30%) of all monies received by the Corporation from The Billing Resource, aka Integretel Billing Solutions, dba Integretel, or any subsidiary or successor thereof (collectively, “Integretel”), on account of traffic and receivables relating to periods prior to the Closing Date, shall be received by the Corporation and held in trust for the benefit of the Parent, and the Purchaser shall cause the Corporation to promptly pay all such amounts to the Parent. For a period up to 18 months (18) from the date hereof, Parent shall have the right, at its own cost, to audit the books and records of Purchaser with respect to amounts paid by Integretel. Parent shall provide a written notice to Purchaser of its intent to audit, along with a schedule of requested documentation. Purchaser shall have fifteen (15) business days to provide such information. If an inspection or audit discloses an understatement of payments or nonpayment due to Parent under this Share Purchase Agreement, Purchaser shall pay Parent, within fifteen (15) days after receipt of the Parent inspection or audit report, the amount of the understatement, plus interest from the date originally due until the date of payment at a rate of 10% per annum. Purchaser shall reimburse Parent for the cost of the audit or inspection, including the charges of attorneys and any independent accountants and the travel expenses, room and board and compensation of Parent’s employees.

13. The Parent and the Vendor shall cause all necessary steps and proceedings to be taken as may be reasonably required by the Corporation’s solicitors to permit the purchase of the Shares and the assumption of the Loans by the Purchaser and the Vendor shall deliver at the Closing Date a certificate representing the Shares duly endorsed for transfer to the Purchaser, and the Parent shall deliver a duly executed assignment of the Loans to the Purchaser.

14. The parties hereto shall request that the Corporation cause the Shares and the Loans to be transferred on the books of the Corporation, to cancel the existing share certificates, issue new share certificates in the name of the Purchaser and to make entries in the securities register of the Corporation accordingly.

15. Each of the parties will pay their own legal, accounting and other expenses incurred in connection with this Agreement.

16. This Agreement shall be governed by and construed in accordance with the laws of Manitoba.

17. The parties hereto shall sign, do and cause to be done everything reasonably necessary or desirable to give full effect to this agreement and every part hereof.

[Remainder of Page Intentionally Left Blank]

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IN WITNESS WHEREOF the parties hereto have executed this agreement effective the date set forth above.

NEOMEDIA TECHNOLOGIES INC.

Per:  /s/ William Hoffman

Name: William Hoffman

Title: CEO

I have authority to bind the corporation.

NEOMEDIA TELECOM SERVICES INC.

Per:  /s/ Scott Womble

Name: Scott Womble

Title: Secretary & Treasurer

I have authority to bind the corporation.

GREYWOLF ENTERTAINMENT INC.

Per:  /s/ Guy Fietz

Name: Guy Fietz

Title: CEO

I have authority to bind the corporation.

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