General

NeoMedia develops proprietary technologies that link physical information and objects to the Internet marketed under the "PaperClick(R)" brand name. NeoMedia has also developed an extensive patent portfolio covering convergence of the physical world and the Internet.

During 2005, NeoMedia continued its efforts to commercialize its PaperClick and Micro Paint Repair businesses both in North America and overseas. As part of the commercialization efforts, NeoMedia began to implement an aggressive growth campaign focusing on expansion through acquisition and globalization. As a result, during the first quarter of 2006 NeoMedia completed acquisitions of Mobot, Inc., 12Snap AG, Sponge Ltd., and Gavitec AG, and BSD Software, Inc., and also signed a letter of intent to acquire Hip Cricket, Inc. (see below for additional discussion of acquisitions)

The Company has adopted a code of ethics, as required by the rules of the SEC (attached as exhibit 10.55 hereto). This code of ethics applies to all of the Company's directors, officers and employees. The code of ethics, and any amendments to, or waivers from, the code of ethics, is available in print, at no charge, to any stockholder who requests such information.