Document:

SECURITY
      AGREEMENT

     

    THIS
      SECURITY AGREEMENT, dated as of April 15, 2008 (this “Agreement”),
      is
      granted jointly and severally by Morlex, Inc., and All Ad Acquisition, Inc.
      (individually and collectively, the “Debtor”)
      to
      Iakona, Inc. (together with its successors and assigns, the “Secured
      Party”).

     

    Preliminary
      Statements

     

    On
      the
      date hereof, the Debtor is entering into that certain Secured Promissory Note
      in
      the principal amount of $4,500,000 (as amended, supplemented or modified from
      time to time, the “Note”)
      with
      the Secured Party. To induce the Secured Party to enter into the Note and to
      make the loans and financial accommodations to the Debtor contemplated
      thereunder, the Debtor is entering into this Agreement with the Secured
      Party.

     

    NOW,
      THEREFORE, in consideration of the premises and mutual covenants herein
      contained and for other good and valuable consideration, the receipt and
      sufficiency of which are hereby acknowledged, the parties hereto agree as
      follows:

     

    
      	1.	
              Definitions.

            

    

     

    1.1 Terms
      Defined in the UCC.
      All
      terms that are defined in the UCC (as hereinafter defined), and that are used
      in
      this Agreement or in Schedule A hereto without definition herein or therein,
      unless the context indicates otherwise, shall have the respective meanings
      specified in the UCC; provided that, to the extent that if any such term is
      defined differently in different Articles of the UCC, the definition of such
      term contained in Article 9 thereof shall govern.

     

    1.2 Additional
      Definitions.
      The
      following terms shall have the following meanings for purposes of this Agreement
      (such meanings to be equally applicable to both the singular and plural forms
      of
      the terms defined):

     

    “Business
      Day”
means
      any day that is not a Saturday, a Sunday or a day on which banks are required
      or
      permitted to be closed in the State of New York.

     

    “Collateral”
means,
      collectively, all of the assets and property of the Debtor described or referred
      to in Schedule A annexed hereto.

     

    “Contracts”
has
      the
      meaning specified in Schedule A hereto.

     

    “Copyright
      Mortgage”
means
      (i) that certain grant of security interest in copyrights made by Ad Authority,
      Inc. in favor of Iakona, Inc. and (ii) that certain grant of security interest
      in trademarks made by Ad Authority, Inc. in favor of Iakona, Inc., both entered
      into concurrently herewith.

     

    “Event
      of Default”
shall
      have the meaning assigned to that term in Section 3 of the Note.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    “Governmental
      Authority”
means
      any federal, state, provincial, county, city, town, village, municipal or other
      government or governmental department, commission, council, court, board,
      bureau, agency, authority or instrumentality (whether executive, legislative,
      judicial, administrative or regulatory), of or within the United States of
      America or its territories or possessions, or of or within any other country,
      or
      of any international community or organization established by
      treaty.

     

    “Insurance”
has
      the
      meaning specified in Schedule A hereto.

     

    “Lien”
means
      any mortgage or deed of trust, pledge, hypothecation, assignment, deposit
      arrangement, lien, charge, claim, security interest, easement or encumbrance,
      or
      preference, priority or other security agreement or preferential arrangement
      of
      any kind or nature whatsoever (including any lease or title retention agreement,
      any financing lease having substantially the same economic effect as any of
      the
      foregoing, and the filing of, any financing statement perfecting a security
      interest under the UCC or comparable law of any jurisdiction).

     

    “Material
      Adverse Effect”
means
      a
      material adverse effect on the business, financial condition and results of
      operations of the Debtor and its subsidiaries taken as a whole, or changes,
      events or conditions that could reasonably be expected to have a material
      adverse effect, but expressly excluding any adverse change, event development
      or
      effect arising from or relating to (a) general business or economic conditions,
      (b) changes in law, rules, regulations, orders or other binding directives
      issued by any governmental entity and (c) the taking of any action contemplated
      by this Agreement or any other agreements contemplated hereby.

     

    “Patent
      Rights”
has
      the
      meaning specified in Schedule A hereto.

     

    “Person”
means
      any individual, sole proprietorship, partnership, joint venture, trust,
      unincorporated organization, association, corporation, limited liability
      company, institution, public benefit corporation, other entity or Governmental
      Authority.

     

    “Permitted
      Liens”
means
      any and all (a) Liens securing any Senior Obligations at anytime arising, (b)
      Lien for taxes securing payments not yet due, (c) Liens that secure indebtedness
      that is reflected in the most recent consolidated financial statements of the
      Debtor previously provided to Secured Party, and (d) such other Liens that,
      individually or in the aggregate, do not materially adversely affect the use
      of
      the properties or assets of Debtor or otherwise materially adversely affect
      the
      business operations as presently conducted or as currently proposed by the
      Debtor’s management to be conducted.

     

    “Records”
has
      the
      meaning specified in Schedule A hereto.

     

    “Secured
      Obligations”
means
      all amounts due and owing by the Debtor to the Secured Party under the Note,
      including, without limitation, all principal, interest (including all interest
      that accrues after the commencement of any case or proceeding by or against
      the
      Debtor in bankruptcy, whether or not allowed in such case or proceeding), fees,
      charges, expenses, attorneys’ fees and any other sum chargeable to the Debtor
      under the Note.

     

    “Senior
      Indebtedness”
means
      indebtedness of the Debtor now or hereafter incurred in connection with the
      Debtor’s entry into its first senior credit facility or other debt financing
      facility following the date hereof, or any documents executed under or in
      connection therewith, and any amendments, modifications, deferrals, renewals
      or
      extensions of such indebtedness, and any amounts owed in respect of any
      indebtedness incurred in refinancing, replacing or refunding the foregoing
      (including any refinancing, replacing or refunding with new lenders), unless
      the
      terms of such indebtedness expressly provide that such indebtedness is not
      senior with respect to the Secured Obligations; provided that, for the avoidance
      of doubt, in no event shall any of the Secured Obligations be included in Senior
      Indebtedness.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    “Senior
      Obligations”
means
      all indebtedness, liabilities and obligations of any kind of Debtor to any
      holder of Senior Indebtedness, including, without limitation, all principal,
      interest (including all interest that accrues after the commencement of any
      case
      or proceeding by or against the Debtor in bankruptcy, whether or not allowed
      in
      such case or proceeding), fees, charges, expenses, attorneys’ fees and any other
      sum chargeable to the Debtor under any agreement, instrument or other document
      evidencing such Senior Indebtedness.

     

    “Taxes”
has
      the
      meaning specified in Section 4.15 hereof.

     

    “Technical
      Information”
has
      the
      meaning specified in Schedule A hereto.

     

    “Trademark”
has
      the
      meaning specified in Schedule A hereto. 

     

    “Trademark
      Rights”
has
      the
      meaning specified in Schedule A hereto.

     

    “UCC”
means
      the Uniform Commercial Code as the same may, from time to time, be enacted
      and
      in effect in the State of New York; provided that in the event that, by reason
      of mandatory provisions of law, any or all of the attachment, perfection or
      priority of, or remedies with respect to, the Secured Party’s Lien on any
      Collateral is governed by the Uniform Commercial Code as enacted and in effect
      in a jurisdiction other than the State of New York, the term “UCC” shall mean
      the Uniform Commercial Code as enacted and in effect in such other jurisdiction
      solely for purposes of the provisions thereof relating to such attachment,
      perfection, priority or remedies and for purposes of definitions related to
      such
      provisions.

     

    
      	2.	
              Grant
                of Lien; Right of Setoff.

            

    

     

    2.1 Subject
      to Section 16 of this Agreement, to secure the prompt and complete payment
      and
      performance of all of the Secured Obligations, the Debtor hereby grants,
      assigns, conveys, mortgages, pledges, hypothecates and transfers to the Secured
      Party a Lien upon all of the Debtor’s right, title and interest in, to and under
      the Collateral.

     

    2.2 In
      addition, to secure the prompt and complete payment and performance of the
      Secured Obligations, the Debtor hereby grants to the Secured Party a right
      of
      setoff against all Collateral now or hereafter in the possession or custody
      of
      or in transit to the Secured Party, for any purpose, including safekeeping,
      collection or pledge, for the account of the Debtor, or as to which the Debtor
      may have any right or power.

     

    2.3 This
      Agreement is in addition to and without limitation of any right of the Secured
      Party under the Note or the Copyright Mortgage.

     

    
      
        
        

      

      
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      	3.	
              Representations
                and Warranties.

            

    

     

    The
      Debtor represents and warrants to the Secured Party that:

     

    3.1 The
      Debtor has full power, right and authority to execute, deliver and perform
      its
      obligations under this Agreement.

     

    3.2 This
      Agreement has been duly authorized, executed and delivered by the Debtor and
      constitutes the legally valid and binding obligation of the Debtor, enforceable
      against the Debtor in accordance with its terms, except to the extent that
      such
      enforcement may be limited by applicable bankruptcy, insolvency and other
      similar laws affecting creditors’ rights generally and by general principles of
      equity.

     

    3.3 The
      execution, delivery and performance by the Debtor of this Agreement does not
      (i)
      require any consent or approval of any Governmental Authority or other Person
      that has not been obtained, (ii) violate any provisions of any law, rule,
      regulation, order, writ, judgment, injunction, decree, determination or award
      presently in effect applicable to the Debtor, except where such violation would
      not have a Material Adverse Effect, (iii) result in a breach of, constitute
      a
      default under or otherwise contravene any indenture or loan or credit agreement
      or any other agreement, lease or instrument to which the Debtor is a party
      or by
      which the Debtor or the Debtor’s properties may be bound or affected, (iv)
      result in, or require, the creation or imposition of any Lien (other than a
      Lien
      in favor of the Secured Party) upon or with respect to any of the Debtor’s
      properties now owned or hereafter acquired, except where such Lien would not
      have a Material Adverse Effect, or (v) cause the Debtor to be in default under
      any such law, rule, regulation, order, writ, judgment, injunction, decree,
      determination or award or any such indenture, agreement, lease or instrument,
      except where such default would not have a Material Adverse Effect.

     

    3.4 The
      Debtor has rights in or the power to transfer rights in each item of the
      Collateral upon which it purports to grant a Lien hereunder free and clear
      of
      any and all Liens; provided, however, that the foregoing shall not prohibit
      the
      Debtor from granting a Permitted Lien after the date hereof, which Permitted
      Lien securing Senior Indebtedness shall be senior to the Secured Party’s Lien in
      each item of the Collateral.

     

    3.5 Schedule
      B annexed hereto accurately and completely sets forth (i) the Debtors’ exact
      legal name as it appears in official filings in the state of its incorporation
      or other organization, (ii) all other names (including, without limitation,
      trade names) under which the Debtor presently conducts business, (iii) all
      other
      names (including, without limitation, trade names) under which the Debtor has
      previously conducted business, (iv) the type of entity of the Debtor (including
      corporation, partnership, limited partnership or limited liability company),
      (v)
      the organizational identification number issued by the Debtors’ state of
      incorporation or organization or a statement that no such number has been
      issued, (vi) the Debtors’ state of organization or incorporation, (vii) the
      locations of the Debtors’ chief executive office and principal place of
      business, (viii) the locations of the Debtors’ other corporate or administrative
      offices, (ix) the locations of all other premises where Collateral is stored
      or
      located, and (x) the locations of the Debtors’ Records concerning the
      Collateral.
      The
      Debtor has only one state of incorporation or organization. Except as noted
      on
      Schedule B hereto, the Debtor conducts and has in the past conducted no
      business, whether directly or indirectly or through any subsidiary, division
      or
      affiliate, under any name or trade name other than its name first recited
      above.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    
      	4.	
              Covenants
                and Agreements of the Debtor.

            

    

     

    The
      Debtor covenants and agrees that:

     

    4.1 At
      the
      time this Agreement is executed and delivered to the Secured Party, the Debtor
      shall: (a) execute and deliver to the Secured Party each instrument of
      assignment and other writing, and take such other action, as the Secured Party
      may deem necessary or desirable to evidence or perfect the Liens of the Secured
      Party in the Collateral, including, without limitation, the filing of financing
      statements and/or fixture filings in each of the jurisdictions specified in
      Schedule F hereto and the filing of the Copyright Mortgage; (b) promptly deliver
      to the Secured Party all original negotiable documents, certificated securities,
      chattel paper and instruments, with each such endorsement, instrument of
      assignment, stock power and other writing as the Secured Party may request;
      and
      (c) execute, endorse, acknowledge and deliver to the Secured Party any
      certificate of title or other document required to acknowledge, register or
      perfect the Liens hereby granted in any of the Collateral.

     

    4.2 Subject
      to the provisions of Section 16 below, the Debtor hereby irrevocably authorizes
      the Secured Party at any time and from time to time to file in any filing office
      in any Uniform Commercial Code jurisdiction any initial financing statements
      and
      amendments thereto that (a) indicate the Collateral (i) as all assets of the
      Debtor or words of similar effect, regardless of whether any particular asset
      comprised in the Collateral falls within the scope of Article 9 of the UCC
      or
      such jurisdiction, or (ii) as being of an equal or lesser scope or with greater
      detail, and (b) contain any other information required by part 5 of Article
      9 of
      the UCC for the sufficiency or filing office acceptance of any financing
      statement or amendment, including (i) whether the Debtor is an organization,
      the
      type of organization and any organization identification number issued to the
      Debtor, and (ii) in the case of a financing statement filed as a fixture filing
      or indicating Collateral as as-extracted collateral or timber to be cut, a
      sufficient description of real property to which the Collateral
      relates.
      The
      Debtor agrees to furnish any such information to the Secured Party promptly
      upon
      request. The Debtor also ratifies its authorization for the Secured Party to
      have filed in any Uniform Commercial Code jurisdiction any initial financing
      statements or amendments thereto if filed prior to the date hereof.

     

    4.3 At
      any
      time and from time to time, upon the written request of the Secured Party and
      at
      the sole expense of the Debtor, the Debtor shall promptly and duly execute
      and
      deliver any and all such further instruments and documents and take such further
      actions as the Secured Party may deem desirable to obtain the full benefits
      of
      this Agreement and of the rights and powers herein granted, including without
      limitation (a) using all commercially reasonable efforts to secure all consents
      and approvals necessary or appropriate for the assignment to or for the benefit
      of the Secured Party of any license or contract held by the Debtor and to
      enforce the security interests granted hereunder; and (b) filing any financing
      or continuation statements under the UCC with respect to the Liens granted
      hereunder as to those jurisdictions that are not Uniform Commercial Code
      jurisdictions and all filings required or prudent relative to the Copyright
      Mortgage.

     

    4.4 The
      Debtor shall promptly notify the Secured Party of any commercial tort claim
      (as
      defined in the Code) acquired by it and unless otherwise consented by the
      Secured Party, the Debtor shall enter into a supplement to this Agreement,
      granting to the Secured Party a Lien in such commercial tort claim.

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    4.5 For
      each
      deposit account that the Debtor at any time opens or maintains, the Debtor
      shall, at the Secured Party’s request and option, pursuant to an agreement in
      form and substance reasonably satisfactory to the Secured Party, either (a)
      cause the depositary bank to agree to comply, without further consent of the
      Debtor, at any time with instructions from the Secured Party to such depositary
      bank directing the disposition of funds from time to time credited to such
      deposit account, or (b) arrange for the Secured Party to become the customer
      of
      the depositary bank with respect to the deposit account, with the Debtor being
      permitted, only with the consent of the Secured Party, to exercise rights to
      withdraw funds from such deposit account; provided that the Secured Party hereby
      agrees that it shall not give any such instructions or withhold any such consent
      unless an Event of Default shall at the time have occurred and be continuing,
      or
      would occur and be continuing immediately after giving effect to any such
      withdrawal.
      The
      provisions of this Section 4.5 shall not apply to (i) any deposit account for
      which the Debtor, the depositary bank and the Secured Party have entered into
      a
      cash collateral agreement specially negotiated among the Debtor, the depositary
      bank and the Secured Party for the specific purpose set forth therein, (ii)
      any
      deposit account with respect to which the Secured Party is the depositary bank
      and thereby has automatic control of such deposit account pursuant to the
      provisions of Section 9-104 of the UCC, (iii) any deposit account specially
      and
      exclusively used by the Debtor for payroll, payroll taxes and other employee
      wage and benefit payments to or for the benefit of the Debtor’s employees, or
      (iv) any deposit accounts that individually or in the aggregate have less than
      $25,000 on deposit at any time.

     

    4.6 The
      Debtor shall not adjust, settle or compromise the amount or payment of any
      account, or release wholly or partly any customer or obligor thereof, or allow
      any credit as discount thereon (other than credits or discounts in the ordinary
      course of business) without the prior consent of the Secured Party, not to
      be
      unreasonably withheld, delayed or conditioned.

     

    4.7 The
      Secured Party shall have the right, by its employees, accountants, attorneys
      and
      other agents, to examine and inspect the Collateral at any reasonable time
      and
      wherever located at the Debtor’s expense not more than four (4) times each year
      unless an Event of Default exists.

     

    4.8 The
      Debtor will defend the Collateral against all claims and demands of all other
      Persons at any time claiming the same or an interest therein.

     

    4.9 If
      any
      action or proceeding shall be commenced, other than any action to collect the
      Secured Obligations, to which action or proceeding the Secured Party is made
      a
      party and in which it becomes necessary to defend or uphold the Secured Party’s
      Liens hereunder, all costs incurred by the Secured Party for the expenses of
      such litigation (including reasonable counsel fees and expenses) shall be deemed
      part of the Secured Obligations secured hereby, which the Debtor agrees to
      pay
      or cause to be paid.

     

    4.10 All
      Records of the Collateral will be located at the Debtor’s principal place of
      business.
      The
      Debtor shall not change any location of any equipment or inventory or Records
      pertaining to any Collateral unless the Debtor gives the Secured Party not
      less
      than seven (7) days’ prior written notice.

     

    
      
        
        

      

      
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    4.11 The
      Debtor will maintain Insurance at its expense at all times in such amounts,
      in
      such form, containing such terms and written by such companies as customarily
      maintained by Persons in business similar to Debtor’s business.
      All
      policies of Insurance shall provide for thirty (30) days’ written notice of
      cancellation or modification to the Secured Party. If an Event of Default
      exists, the Secured Party is authorized by the Debtor to act as its attorney
      in
      collecting, adjusting, settling or canceling such Insurance and endorsing any
      drafts drawn by insurers. The Secured Party may apply any proceeds of Insurance
      received by it to the Secured Obligations if an Event of Default then exists.
      The Debtor will promptly notify the Secured Party of any damage to or loss
      of
      the Collateral in excess of $50,000. Not later than the expiration date of
      each
      policy of Insurance then in effect, the Debtor shall deliver to the Secured
      Party a certificate of insurance certifying as to (i) the extension of such
      policy or the issuance of a renewal policy therefor, describing the same in
      reasonable detail satisfactory to the Secured Party and (ii) the payment in
      full
      of the portion of the premium therefor then due and payable (or accompanied
      by
      other proof of such payment satisfactory to the Secured Party). The Debtor
      shall
      be required forthwith to notify the Secured Party (by telephone, confirmed
      in
      writing) if the Debtor shall determine at any time not to, or at any time be
      unable to, extend or renew any such policy then in effect.

     

    4.12 The
      Debtor will use the Collateral for business purposes and not in violation of
      any
      statute or ordinance and will keep the Collateral in working order and
      condition, and from time to time the Debtor will make to such Collateral all
      needful and proper repairs, renewals, replacements, extensions, additions,
      betterments and improvements thereto, to the extent and in the manner customary
      for companies in similar lines of business under similar
      circumstances.

     

    4.13 The
      Debtor will pay promptly when due all material excise, property, sales and
      use
      taxes and assessments imposed by any Governmental Authority upon or with respect
      to any of the Collateral (“Taxes”), except for any Taxes which are being
      contested in good faith and for which adequate reserves under generally accepted
      accounting principles have been established.

     

    4.14 The
      Debtor will at all times keep accurate and complete Records of the Debtor’s
      accounts, instruments and other Collateral.
      The
      Secured Party, or any of its agents, shall have the right to call at the
      Debtor’s place or places of business at reasonable intervals and upon reasonable
      notice to inspect, audit, make test verifications and otherwise examine and
      make
      extracts from the books, journals, orders, receipts, correspondence and other
      Records relating to any of the Collateral at the Debtor’s expense not more than
      four (4) times each year unless an Event of Default exists.

     

    4.15 Upon
      the
      occurrence and during the continuance of an Event of Default, the Debtor agrees,
      upon the written demand of the Secured Party, to stamp all books and records
      pertaining to the Debtor’s accounts, instruments and general intangibles to
      evidence the Secured Party’s Lien therein in form reasonably satisfactory to the
      Secured Party.

     

    4.16 The
      Debtor will notify the Secured Party in writing at least thirty (30) days prior
      to changing its chief executive office or other locations at which it does
      business or changing its name or conducting business under any name or trade
      name or changing its state of incorporation (by way of merger, consolidation,
      reincorporation or otherwise), in each case specifying the places or names
      involved.

     

    
      
        
        

      

      
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    4.17 Upon
      the
      reasonable request of the Secured Party, the Debtor shall obtain the consent
      of
      any Person, governmental instrumentality or agency, or public body or official
      to the assignment hereunder of any account, instrument, document or general
      intangible if such consent may be required by the terms of any agreement,
      contract or statute.

     

    4.18 Other
      than a planned reincorporation in the State of Delaware, the Debtor shall not
      reincorporate or reorganize itself under the laws of any jurisdiction other
      than
      the jurisdiction in which it is incorporated or organized as of the date hereof
      without the prior written consent of the Secured Party, which consent shall
      not
      be unreasonably withheld, delayed or conditioned.

     

    
      	5.	
              Remedies;
                Rights Upon Default.

            

    

     

    5.1 In
      addition to all other rights and remedies granted to it under this Agreement
      and
      the Note, upon the occurrence and during the continuance of any Event of
      Default, the Secured Party shall have and may exercise all of the rights, powers
      and remedies of a secured party under the UCC, including without limitation,
      the
      right to sell, lease or otherwise dispose of any or all of the Collateral,
      and
      to take possession of the Collateral, and for that purpose the Secured Party
      may
      enter peaceably any premises on which the Collateral or any part thereof may
      be
      situated and remove the same therefrom and the Debtor will not resist or
      interfere with such action.
      The
      Secured Party may require the Debtor to assemble the Collateral and make the
      same available to the Secured Party at a place to be designated by the Secured
      Party which is reasonably convenient to both parties. The Debtor hereby agrees
      that the place or places of location of the Collateral are places reasonably
      convenient to it to assemble the Collateral. Unless the Collateral is perishable
      or threatens to decline speedily in value or is of a type customarily sold
      on a
      recognized market, the Secured Party will send the Debtor reasonable notice
      of
      the time and place of any public sale or reasonable notice of the time after
      which any private sale or any other disposition thereof is to be made. The
      requirement of sending reasonable notice shall be met if such notice is mailed,
      postage prepaid, to the Debtor at least ten (10) days before the time of the
      sale or disposition. The Secured Party shall have the right upon any such public
      sale or sales and, to the extent permitted by law, upon any such private sale
      or
      sales, to purchase for the benefit of the Secured Party, the whole or any part
      of said Collateral so sold. Such sales may be adjourned and continued from
      time
      to time with or without notice. The Secured Party shall have the right to
      conduct such sales on the Debtor’s premises or elsewhere and shall have the
      right to use the Debtor’s premises without charge for such time or times as the
      Secured Party deems necessary or advisable. Until the Secured Party is able
      to
      effect a sale, lease, or other disposition of Collateral, the Secured Party
      shall have the right to hold or use such Collateral, or any part thereof, to
      the
      extent that it deems appropriate for the purpose of preserving such Collateral
      or its value or for any other purpose deemed appropriate by the Secured Party.
      The Secured Party shall have no obligation to the Debtor to maintain or preserve
      the rights of the Debtor as against third parties with respect to Collateral
      while such Collateral is in the possession of the Secured Party. The Secured
      Party may, if it so elects, seek the appointment of a receiver or keeper to
      take
      possession of Collateral and to enforce any of the Secured Party’s remedies with
      respect to such appointment without prior notice or hearing as to such
      appointment. To the maximum extent permitted by applicable law, the Debtor
      waives all claims, damages, and demands against the Secured Party arising out
      of
      the repossession, retention or sale of the Collateral except such as arise
      solely out of the gross negligence or willful misconduct of the Secured Party
      as
      finally determined by a court of competent jurisdiction.

     

    
      
        
        

      

      
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    5.2 Upon
      demand by the Secured Party after the occurrence and during the continuance
      of
      an Event of Default, the Debtor will promptly deliver to the Secured Party
      all
      proceeds of Collateral, and all original evidences of accounts, chattel paper,
      instruments, documents, securities or general intangibles of the Debtor,
      including, without limitation, all checks, drafts, cash and other remittances,
      notes, trade acceptances or other instruments or contracts for the payment
      of
      money, appropriately endorsed to the Secured Party’s order and, regardless of
      the form of such endorsement, the Debtor hereby waives presentment, demand,
      notice of dishonor, protest and notice of protest and all other notices with
      respect thereto. Pending such deposit, the Debtor agrees that it will not
      commingle any such checks, drafts, cash and other remittances with any of the
      Debtor’s funds or property, but will hold them separate and apart therefrom and
      upon an express trust for the Secured Party, until delivery thereof is made
      to
      the Secured Party.

     

    
      	6.	
              Waivers.

            

    

     

    The
      Debtor hereby waives all demands, notices and protests of every kind which
      are
      not expressly required under this Agreement which are permitted by law to be
      waived, and which would, if not waived, impair the Secured Party’s enforcement
      of this Agreement or release any Collateral from the Liens of the Secured Party
      under this Agreement.

     

    
      	7.	
              Actions
                and Proceedings.

            

    

     

    THE
      DEBTOR HEREBY IRREVOCABLY CONSENTS TO THE NONEXCLUSIVE JURISDICTION AND VENUE
      OF
      ANY STATE OR FEDERAL COURT SITTING IN THE COUNTY OF SAN DIEGO, STATE OF
      CALIFORNIA, IN CONNECTION WITH ANY ACTION OR PROCEEDING ARISING OUT OF OR
      RELATING TO THIS AGREEMENT; PROVIDED, HOWEVER, THAT NOTHING IN THIS AGREEMENT
      SHALL BE DEEMED OR SHALL OPERATE TO PRECLUDE THE SECURED PARTY FROM BRINGING
      SUIT OR TAKING OTHER LEGAL ACTION IN ANY OTHER JURISDICTION TO REALIZE ON THE
      COLLATERAL OR ANY OTHER SECURITY FOR THE SECURED OBLIGATIONS, OR TO ENFORCE
      A
      JUDGMENT OR OTHER COURT ORDER IN FAVOR OF THE SECURED PARTY. THE DEBTOR
      EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO SUCH JURISDICTION IN ANY ACTION
      OR
      SUIT COMMENCED IN ANY SUCH COURT, AND HEREBY WAIVES ANY OBJECTION WHICH IT
      MAY
      HAVE BASED UPON LACK OF PERSONAL JURISDICTION, IMPROPER VENUE OR
FORUM NON CONVENIENS.
      THE DEBTOR HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS, COMPLAINT AND OTHER
      PROCESS ISSUED IN ANY SUCH ACTION OR SUIT AND AGREES THAT SERVICE OF SUCH
      SUMMONS, COMPLAINTS AND OTHER PROCESS MAY BE MADE BY REGISTERED OR CERTIFIED
      MAIL ADDRESSED TO THE DEBTOR AT THE ADDRESS FOR NOTICE SET FORTH HEREIN AND
      THAT
      SERVICE SO MADE SHALL BE DEEMED COMPLETED UPON THE EARLIER OF ACTUAL RECEIPT
      THEREOF OR THREE (3) DAYS AFTER DEPOSIT IN THE U.S. MAILS, PROPER POSTAGE
      PREPAID.

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    
      	8.	
              Waiver
                of Jury Trial.

            

    

     

    THE
      PARTIES HERETO HEREBY WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, SUIT
      OR
      PROCEEDING BROUGHT TO RESOLVE ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT,
      OR OTHERWISE, BETWEEN THE SECURED PARTY AND THE DEBTOR ARISING OUT OF, CONNECTED
      WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED IN CONNECTION
      WITH, THIS AGREEMENT OR THE TRANSACTIONS RELATED HERETO.

     

    
      	9.	
              Address
                for Notices and Service of Process.

            

    

     

    All
      notices hereunder shall be in writing and shall be conclusively deemed to have
      been received and shall be effective (a) on the day on which delivered if
      delivered personally or transmitted by facsimile (with hard copy sent
      concurrently by first class, U.S. mail, postage prepaid), (b) one Business
      Day
      after the date on which the same is delivered to a nationally recognized
      overnight courier service, or (c) three Business Days after being sent by
      registered or certified United States mail, return receipt
      requested.

     

    If
      to the Debtor:

    

    Morlex,
      Inc.

    420
      Lexington Avenue

    Suite
      450

    New
      York,
      NY 10170

    Attention:
      Mr. Richard Berman

    Tel:
      (212) 581-5150

    Fax:
      (212) 581-5198

    

    All
      Ad
      Acquisition, Inc.

    c/o
      Morlex, Inc.

    420
      Lexington Avenue

    Suite
      450

    New
      York,
      NY 10170

    Attention:
      Mr. Richard Berman

    Tel:
      (212) 581-5150

    Fax:
      (212) 581-5198

    

    with
      a
      copy to:

    

    Nixon
      Peabody LLP

    437
      Madison Avenue

    New
      York,
      NY 10022

    Attention:
      Jane Greyf, Esq.

    Tel:
      (212) 940-3155

    Fax:
      (866) 516-0358

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    If
      to the Secured Party:

    

    Iakona,
      Inc.

    906
      West
      Lewis

    San
      Diego, CA 32103

    Attention:
      Jason Kulpa

    

    with
      a
      copy to:

    

    Rutter
      Hobbs & Davidoff Incorporated

    1901
      Avenue of the Stars, Suite 1700

    Los
      Angeles, CA 90067

    Attention:
      Andrew M. Apfelberg, Esq.

    Tel:
      (310) 286-1700

    Fax:
      (310) 286-1728

     

    
      	10.	
              No
                Waiver of Remedies.

            

    

     

    No
      failure to exercise and no delay in exercising, on the part of the Secured
      Party, any right, remedy, power or privilege under this Agreement shall operate
      as a waiver thereof; nor shall any single or partial exercise of any right,
      remedy, power or privilege under this Agreement preclude any other or further
      exercise thereof or the exercise of any other right, remedy, power or privilege.
      The rights, remedies, powers and privileges provided under this Agreement are
      cumulative and are not exclusive of any rights, remedies, powers and privileges
      provided under the Note or by law.

     

    
      	11.	
              New
                York Law.

            

    

     

    THIS
      AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS
      OF
      THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND PERFORMED IN THAT
      STATE.

     

    
      	12.	
              Entire
                Agreement; Modifications.

            

    

     

    This
      Agreement and the other documents executed and delivered to the Secured Party
      in
      connection herewith on the date hereof referenced herein (including without
      limitation the Note) contain the entire agreement between the Secured Party
      and
      the Debtor with respect to all subject matters contained herein. This Agreement
      cannot be amended, modified or changed in any way, except by a written
      instrument executed by the Secured Party and the Debtor. No waiver of or
      departure from any provision of this Agreement shall be effective except by
      a
      written instrument executed by the Secured Party.

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    
      	13.	
              Successors
                and Assigns.

            

    

     

    The
      covenants, representations, warranties and agreements herein set forth shall
      be
      binding upon the Debtor, its legal representatives, successors and assigns
      (including, without limitation, any debtor-in-possession on behalf of the
      Debtor) and shall inure to the benefit of the Secured Party and its successors
      and assigns. Any successor or assign of the Secured Party shall forthwith become
      vested with and entitled to exercise all the powers and rights given by this
      Agreement to the Secured Party, as if such successor or assign were originally
      named as the Secured Party herein. The Debtor may not assign, sell, hypothecate
      or otherwise transfer and interest in or delegate any obligation under this
      Agreement.

     

    
      	14.	
              Severability.

            

    

     

    If
      any
      provision hereof shall be held to be invalid, illegal or unenforceable in any
      jurisdiction, then, to the fullest extent permitted by law, (i) the other
      provisions hereof shall remain in full force and effect in such jurisdiction,
      and (ii) the invalidity or unenforceability of any provision hereof in any
      jurisdiction shall not affect the validity or enforceability of such provision
      in any other jurisdiction.

     

    
      	15.	
              Counterparts.

            

    

     

    This
      Agreement may be executed in any number of counterparts, all of which, when
      taken together shall constitute one and the same instrument, and any party
      hereto may execute this Agreement by signing any such counterpart.

     

    
      	16.	
              Subordination.

            

    

     

    16.1 Notwithstanding
      the date, time, method, manner or order of grant, attachment or perfection
      of
      any Liens securing the Secured Obligations granted on the Collateral hereunder
      or of any Liens securing the Senior Obligations granted on the Collateral and
      notwithstanding any provision of the UCC, or any other applicable law or this
      Agreement or the Note or any defect or deficiencies in, or failure to perfect,
      any Liens securing the Senior Obligations or any other circumstance whatsoever,
      the Secured Party hereby agrees that:

     

    (a) the
      payment of any and all of the Secured Obligations shall be subordinated and
      subject in right and time of payment to the prior indefeasible payment and
      performance in full of the current portion of all Senior Obligations, provided
      that unless a default or an event of default has occurred and is continuing
      under the Senior Credit Facility: (x) the Secured Party shall not be required
      to
      agree to suspend, delay or reduce any payments due under the Note and (y)
      nothing herein shall prevent Secured Party from timely receipt of all sums
      due
      under the Note;

     

    (b) any
      Lien
      on the Collateral securing any Senior Obligations held by or on behalf of any
      holder of Senior Indebtedness or any agent or trustee therefor, regardless
      of
      how acquired, whether by grant, possession, statute, operation of law,
      subrogation or otherwise, shall be senior in all respects and prior to any
      Lien
      on the Collateral securing the Secured Obligations; and

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    (c) any
      Lien
      on the Collateral securing any Secured Obligations now or hereafter held by
      or
      on behalf of the Secured Party or any agent or trustee therefor regardless
      of
      how acquired, whether by grant, possession, statute, operation of law,
      subrogation or otherwise, shall be junior and subordinate in all respects to
      all
      Liens on the Collateral securing any Senior Obligations. All Liens on the
      Collateral securing any Senior Obligations, whenever arising, shall be and
      remain senior in all respects and prior to all Liens on the Collateral securing
      any Secured Obligations for all purposes, whether or not such Liens securing
      any
      Senior Obligations are subordinated to any Lien securing any other obligation
      of
      the Debtor. 

     

    16.2 By
      virtue
      of accepting this Agreement and the benefits hereof and provided that a
      principal of Secured Party is an officer or director of Debtor, the Secured
      Party hereby waives any and all notice of incurrence, extension, advance,
      renewal or accrual of any Senior Indebtedness, present or future, and agrees
      and
      consents that without notice to or consent of the Secured Party: (i) the
      obligations and liabilities of the Debtor or any other party or parties under
      Senior Indebtedness may, from time to time, in whole or in part, be renewed,
      refinanced, replaced, extended, refunded, modified, amended, accelerated,
      compromised, supplemented, terminated, increased, decreased, sold, exchanged,
      waived or released; (ii) the holders of Senior Indebtedness and their
      representatives may exercise or refrain from exercising any right, remedy or
      power granted by any document creating, evidencing or otherwise related to
      the
      Senior Indebtedness or at law, in equity, or otherwise, with respect to the
      Senior Indebtedness or in connection with any collateral security or lien (legal
      or equitable) held, given or intended to be given therefor (including, without
      limitation, the right to perfect any lien or security interest created in
      connection therewith); (iii) any and all collateral security and/or liens (legal
      or equitable) at any time, present or future, held, given or intended to be
      given for Senior Indebtedness, and any rights or remedies of the holders of
      Senior Indebtedness and their representatives in respect thereof, may, from
      time
      to time, in whole or in part, be exchanged, sold, surrendered, released,
      modified, perfected, unperfected, waived or extended by the holders and their
      representatives; (iv) any balance or balances of funds with any holder of Senior
      Indebtedness at any time standing to the credit of the Debtor or any guarantor
      of any Senior Indebtedness may, from time to time, in whole or in part, be
      surrendered or released, all as the holders of Senior Indebtedness, their
      representatives or any of them may deem advisable and all without impairing,
      abridging, diminishing, releasing or affecting the subordination to Senior
      Indebtedness provided for herein; and (v) the Debtor may incur any amount or
      type of Senior Indebtedness (including Senior Indebtedness owed to affiliates),
      or modify, restate, refinance, replace or amend any Senior Indebtedness from
      time to time, on terms and conditions acceptable to the Debtor.

     

    16.3 The
      Secured Party agrees that at any time and from time to time upon the written
      request of the Debtor, the Secured Party will at its expense execute and deliver
      such further agreements, documents and instruments and do such further acts
      and
      make such authorizations as the Debtor or any holder of Senior Indebtedness
      may
      reasonably request in order to evidence, confirm and otherwise effectuate the
      provisions set forth in this Section 16, including, without limitation, amending
      any financing or continuation statements under the UCC or entering into any
      intercreditor agreement or subordination agreement or any amendment to this
      Agreement or the Note, as may be required by any holder of Senior Indebtedness;
      provided, that, so long as no default or event of default has occurred and
      is
      continuing under the Senior Indebtedness, nothing herein shall require Secured
      Party to (x) agree to suspend, delay or reduce any payments under the Note,
      (y)
      forego the timely receipt of all sums due under the Note or (z) consent to
      the
      Debtor's entry into any Senior Obligations that would require any modification
      of the Note.
      Debtor
      hereby acknowledges and agrees that Secured Party and its shareholders shall
      be
      relieved of their fiduciary and other duties to Debtor and its shareholders
      with
      respect to: (i) enforcement and/or modification of this Agreement or the Note;
      and (ii) the Debtor's evaluation of or entry into any Senior
      Obligations.

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

    
      	17.	
              Limitation
                on Duty of Secured Party.

            

    

     

    17.1 Secured
      Party shall never be liable for its failure to use due diligence in the
      collection of the Secured Obligations, or any part thereof, or for its failure
      to give notice to Debtor of default in the payment of the Secured Obligations,
      or any part thereof, or in the payment of or upon any security, whether pledged
      hereunder or otherwise.

     

    17.2 Secured
      Party shall have no duty to fix or preserve rights against parties to the
      Collateral, and shall never be liable for its failure to use diligence to
      collect any amount payable in respect of the Collateral, but shall be liable
      only to account to Debtor for what it may actually collect or receive
      thereon.
      Without
      limiting the generality of the immediately preceding sentence, it is
      specifically understood and agreed that Secured Party shall have no
      responsibility for ascertaining any maturities, calls, conversions, exchanges,
      offers, tenders, or similar matters relating to any of the Collateral or for
      informing Debtor with respect to any of such matters (irrespective of whether
      Secured Party actually has, or may be deemed to have, knowledge
      thereof).

     

    17.3 Secured
      Party shall not be required to take any steps or actions with regard to the
      Collateral as may be requested or authorized by Debtor unless (i) Secured Party
      shall determine, in its sole discretion, that such steps or actions will not
      adversely affect the value of the Collateral, and (ii) such request or
      authorization by Debtor is made in writing and is actually received by Secured
      Party.

     

    17.4 [Reserved].

     

    
      	18.	
              Other
                Remedies.

            

    

     

    18.1 Secured
      Party shall be entitled to apply the proceeds of any sale or other disposition
      of the Collateral in the following order: (i) first, to all costs and expenses
      incurred in connection therewith or incidental thereto, including reasonable
      attorneys’ fees and expenses to which the Secured Party is entitled hereunder;
      (ii) second, to satisfaction of the Secured Obligations; (iii) third, to payment
      of any other amounts required by applicable law; and (iv) fourth, to Debtor
      to
      the extent of any surplus remaining.
      If the
      proceeds are not sufficient to pay the Secured Obligations in full, Debtor
      shall
      remain liable for any deficiency.

     

    18.2 So
      long
      as an Event of Default exists, each account debtor and obligor making payment
      to
      Secured Party hereunder shall be fully protected in relying on the written
      statement of Secured Party that it then holds a security interest which entitles
      it to receive such payment, and the receipt of Secured Party for such payment
      shall be full acquittance therefor to the one making such payment.

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

     

    
      	19.	
              Power
                of Attorney.

            

    

     

    Each
      Debtor grants to the Secured Party an irrevocable power of attorney coupled
      with
      an interest authorizing and permitting Secured Party, at its option, with or
      without notice to Debtor, to do any or all of the following upon the occurrence
      and during the continuance of an Event of Default:

     

    (a) endorse
      the name of Debtor on any checks or other evidences of payment whatsoever that
      may come into the possession of Secured Party 
      regarding Collateral in order to implement the provisions of this Agreement
      or
      the Note;

     

    (b) receive,
      open and forward any mail addressed to Debtor and put Secured Party ’s
      address on any statements mailed to account debtors;

     

    (c) pay,
      settle, compromise, prosecute or defend any action, claim, conditional waiver
      and release, or proceeding relating to Collateral;

     

    (d) notify,
      in the name of Debtor, the U.S. Post Office to change the address for delivery
      of mail addressed to Debtor to such address as Secured Party may
      designate (provided that Secured Party shall
      promptly turn over to Debtor all such mail not relating to
      Collateral);

     

    (e) verify,
      sign, acknowledge, record, file for recording, serve as required by law, any
      claim of mechanic’s lien, stop notice or bonded stop notice in the sole and
      absolute discretion of Secured Party relating
      to any Collateral;

     

    (f) insert
      all recording or service information in any mechanic’s lien or assignment of
      rights under stop notice/bonded stop notice which Debtor has signed in
      connection with this Agreement, recorded or served to enforce payment of the
      Collateral;

     

    (g) file
      on
      behalf of Debtor any financing statement, amendment thereto or continuation
      thereof:

     

    
      	 	
              (i)

            	
              deemed
                necessary or appropriate by Secured Party 
                in
                its reasonable discretion (from the standpoint of a secured creditor)
                to
                protect Secured Party’s interest in and to the Collateral;
                or

            

    

     

    
      	 	
              (ii)

            	
              required
                or permitted under any provision of this Agreement;
                and

            

    

     

    (h) do
      all
      other things necessary and proper in order to carry out this Agreement. The
      authority granted to Secured Party pursuant
      to this Section 19 is irrevocable until this Agreement is terminated and all
      amounts due to Secured Party hereunder have been paid in full. Secured
      Party shall
      have no obligation to exercise any of the rights granted to it
      hereunder

     

    [Signature
      page follows]

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

       

    

    IN
      WITNESS WHEREOF,
      the
      Debtor has caused this Agreement to be executed by its duly authorized officer
      or representative as of the date and year first above written.

    

      
        	 	
                MORLEX,
                  INC.

              
	 	 
	 	
                By:

              	
                /s/
                  Richard J. Berman

              	
              
	 	 	
                Name:
                   Richard J. Berman

              
	 	 	
                Title:  
                   Chief Executive Officer

              
	 	 
	 	
                ALL
                  AD ACQUISITION, INC.

              
	 	 
	 	 
	 	
                By:

              	
                /s/
                  Richard J. Berman

              	
              
	 	 	
                Name: 
                  Richard J. Berman

              
	 	 	
                Title: 
                    President

              

      

    

     

    ACCEPTED
      AND AGREED:

     

    IAKONA,
      INC.

     

     

    
      	
              By:

            	
              /s/
                Jason J. Kulpa

            
	 	
              Name:
                Jason J. Kulpa

            
	 	
              Title:
                President

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    SCHEDULE
      A

    to

    Security
      Agreement and UCC-1 Financing Statement

    granted
      by

    Morlex,
      Inc. and All Ad Acquisition, Inc. as “Debtor”

    in
      favor
      of

    Iakona,
      Inc.

    as
      the
“Secured Party”

     

    Description
      of Collateral

     

    All
      right, title and interest of the Debtor in, to and under all personal property
      whether now owned by or owing to, or hereafter acquired by or arising in favor
      of the Debtor (including under any trade names, styles or derivations thereof),
      and whether owned or consigned by or to, or leased from or to, the Debtor,
      and
      regardless of where located, including, without limitation:

     

    
      	 	
              1.

            	
              all
                accounts (including, without limitation, health-care-insurance
                receivables);

            

    

     

    
      	 	
              2.

            	
              all
                chattel paper (including, without limitation, tangible chattel paper
                and
                electronic chattel paper);

            

    

     

    
      	 	
              3.

            	
              all
                documents;

            

    

     

    
      	 	
              4.

            	
              all
                general intangibles (including, without limitation, payment intangibles
                and software and the domain names set forth in the Purchase
                Agreement);

            

    

     

    
      	 	
              5.

            	
              all
                commercial tort claims;

            

    

     

    
      	 	
              6.

            	
              all
                goods (including, without limitation, inventory, equipment and
                fixtures);

            

    

     

    
      	 	
              7.

            	
              all
                instruments (including, without limitation, promissory
                notes);

            

    

     

    
      	 	
              8.

            	
              all
                investment property (including, without limitation, certificated
                and
                uncertificated securities, security entitlements, securities accounts,
                commodity contracts and commodity accounts but not including the
                capital
                stock of Ad Authority, Inc.);

            

    

     

    
      	 	
              9.

            	
              all
                deposit accounts of the Debtor and all deposits
                therein;

            

    

     

    
      	 	
              10.

            	
              all
                money, cash or cash equivalents of the
                Debtor;

            

    

     

    
      	 	
              11.

            	
              all
                supporting obligations and letter-of-credit rights;
                and

            

    

     

    
      	 	
              12.

            	
              to
                the extent not otherwise included, all proceeds, tort claims, insurance
                claims and other rights to payments not otherwise included in the
                foregoing and products of the foregoing and all accessions to,
                substitutions and replacements for, and rents and profits of, each
                of the
                foregoing.

            

    

     

    
      
        Schedule
          A-1

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    IN
      FURTHERANCE OF THE FOREGOING TYPES OF COLLATERAL, AND WITHOUT LIMITATION
      THEREOF, all of the following property, now owned or hereafter acquired, arising
      or existing, together with all proceeds thereof:

     

    
      	 	
              13.

            	
              All
                of the contracts and agreements of the Debtor, together with all
                schedules, exhibits, documents and certificates referred to therein,
                as
                amended, supplemented or otherwise modified from time to time, including
                without limitation, all rights of the Debtor to (a) receive moneys
                due and
                to become due to it thereunder or in connection therewith, (b) damages
                arising out of, or for, breach or default in respect thereof, (c)
                compel
                performance of the terms thereof, (d) benefits and claims under all
                warranty and indemnity provisions contained therein, (e) all insurance
                payments provided therein and (f) any other moneys due and to become
                due
                to the Debtor thereunder or in connection therewith and all proceeds
                and
                general intangibles arising from any of the foregoing (the “Contracts”).

            

    

     

    
      	 	
              14.

            	
              All
                insurance covering any type of Collateral described in this Schedule
                A or
                any part thereof against risks of fire, flood, theft, loss, nonconformity
                of, defects or infringement of rights in, or damage or any other
                risk of
                loss whatsoever and all proceeds and general intangibles arising
                from any
                of the foregoing (“Insurance”).

            

    

     

    
      	 	
              15.

            	
              All
                of the Debtor’s right, title and interest in all of its books, records,
                ledger sheets, files and other data and documents, including records
                in
                any form (digital or other) and recorded in or through any tangible
                medium
                (magnetic, lasergraphic or other) and retrievable in perceivable
                form,
                together with all machinery and processes (including computer programming
                instructions) required to read and print such records relating to
                any of
                the types of Collateral described in this Schedule A (“Records”).

            

    

     

    
      	 	
              16.

            	
              All
                patent rights throughout the world, including all letters patents,
                patent
                applications, patent licenses, patentable inventions, modifications
                and
                improvements thereof, all rights to any and all letters patent and
                applications for letters patent, all divisions, renewals, reissues,
                continuations, continuations-in-part, extensions and reexaminations
                of any
                of the foregoing, all shop rights, all proceeds of, and rights associated
                with any of the foregoing (including license royalties and proceeds
                of
                infringement suits), the right to sue third parties for past, present
                or
                future infringements of any of the foregoing and for breach or enforcement
                of any of the foregoing, and all rights corresponding to each of
                the
                foregoing throughout the world and all proceeds and general intangibles
                arising from any of the foregoing (“Patent
                Rights”).

            

    

     

    
      	 	
              17.

            	
              All
                information concerning the subject matter of the Patent Rights, and
                all
                other confidential or proprietary or useful information and all know-how
                and common law or statutory trade secrets obtained by or used in
                or
                contemplated at any time for use in the business of the Debtor, and
                all
                other research and development work by the Debtor whether or not
                the same
                is a patentable invention, including without limitation all design
                and
                engineering data, shop rights, instructions, procedures, standards,
                specifications, plans, drawings and designs and all proceeds and
                general
                intangibles arising from any of the foregoing (the “Technical
                Information”).

            

    

     

    
      
        Schedule
          A-2

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      	 	
              18.

            	
              All
                trademarks, trade names, corporate names, company names, business
                names,
                fictitious business names, trade styles, service marks, certification
                marks, collective marks, logos, domain names, URLs, other source
                of
                business identifiers, prints and labels on which any of the foregoing
                have
                appeared or appear, designs and general intangibles of a like nature
                (each
                of the foregoing items being called a “Trademark”),
                now existing anywhere in the world or hereafter adopted or acquired,
                whether currently in use or not, all registrations and recordings
                thereof
                and all applications in connection therewith, whether pending or
                in
                preparation for filing, including registrations, recordings and
                applications in the United States Patent and Trademark Office or
                in any
                office or agency of the United States of America or any State thereof
                or
                any foreign country, all Trademark licenses, all reissues, extensions
                or
                renewals of any of the foregoing items all of the goodwill of the
                business
                connected with the use of, and symbolized by the foregoing items
                all
                proceeds of, and rights associated with, the foregoing, including
                any
                claim by the Debtor against third parties for past, present or future
                infringement or dilution of any Trademark, Trademark registration
                or
                Trademark license, including any Trademark, Trademark registration
                or
                Trademark license, or for any injury to the goodwill associated with
                the
                use of any such Trademark or for breach or enforcement of any Trademark
                license and all proceeds and general intangibles arising from any
                of the
                foregoing (the “Trademark
                Rights”).

            

    

     

    
      	 	
              19.

            	
              All
                copyrights and all semiconductor chip product mask works of the Debtor,
                whether statutory or common law, registered or unregistered, now
                or
                hereafter in force throughout the world, including, without limitation,
                all of the Debtor’s right, title and interest in and to all copyrights and
                mask works registered in the United States Copyright Office or anywhere
                else in the world and all applications for registration thereof,
                whether
                pending or in preparation, all copyright and mask work licenses,
                the right
                to sue for past, present and future infringements of any thereof,
                all
                rights corresponding thereto throughout the world, all extensions
                and
                renewals of any thereof and all proceeds of the foregoing, including,
                without limitation, licenses, royalties, income, payments, claims,
                damages
                and proceeds of suit and all proceeds and general intangibles arising
                from
                any of the foregoing (the “Copyrights”).

            

    

     

    
      
        Schedule
          A-3

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      	 	
              20.

            	
              (A)
                all computer and other electronic data processing hardware, integrated
                computer systems, central processing units, memory units, display
                terminals, printers, features, computer elements, card readers, tape
                drives, hard and soft disk drives, cables, electrical supply hardware,
                generators, power equalizers, accessories and all peripheral devices
                and
                other related computer hardware, whether now owned, licensed or leased
                or
                hereafter acquired by the Debtor; (B) all software programs including
                source code and object code and all related applications and data
                files),
                whether now owned, licensed or leased or hereafter acquired by the
                Debtor,
                designed for use on the computers and electronic data processing
                hardware
                described in clause (A) above; (C) all firmware associated therewith,
                whether now owned, licensed or leased or hereafter acquired by the
                Debtor;
                (D) all documentation (including flow charts, logic diagrams, manuals,
                guides and specifications) for such hardware, software and firmware
                described in the preceding clauses (A), (B) and (C), whether now
                owned,
                licensed or leased or hereafter acquired by the Debtor; and (E) all
                rights
                with respect to all of the foregoing, including, without limitation,
                any
                and all copyrights, licenses, options, warranties, service contracts,
                program services, test rights, maintenance rights, support rights,
                improvement rights, renewal rights and indemnifications and any
                substitutions, replacements, additions or model conversions of any
                of the
                foregoing and all proceeds and general intangibles arising from any
                of the
                foregoing (the “Computer
                Hardware and Software”).

            

    

     

    
      
        Schedule
          A-4

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    SCHEDULE
      B

    to

    Security
      Agreement

    granted
      by

    Morlex,
      Inc. and All Ad Acquisition, Inc. as “Debtor”

    in
      favor
      of

    Iakona,
      Inc.

    as
      the
“Secured Party”

     

    SCHEDULE
      OF OFFICES, LOCATIONS OF COLLATERAL

    AND
      RECORDS CONCERNING DEBTORS’ COLLATERAL

     

    
      	 	
              I.

            	
              Debtors’
                exact legal names: Morlex,
                Inc. and All Ad Acquisition,
                Inc.

            

    

     

    
      	 	
              II.

            	
              All
                other names (including trade names) under which Debtor presently
                conducts
                business: Ad
                Authority, Inc., NR Leads, Student Box, Insurance Box and Finance
                Box.

            

    

     

    
      	 	
              III.

            	
              All
                other names (including trade names) under which Debtor or any predecessor
                to Debtor (by merger or otherwise) has previously conducted business
                during the past five years:
                None .

            

    

     

    
      	 	
              IV.

            	
              Type
                of entity (e.g., corporation, partnership, business trust, limited
                partnership, limited liability company): Each,
                a corporation.

            

    

     

    
      	 	
              V.

            	
              Organizational
                identification number issued by Debtors’ state of incorporation or
                organization or a statement that no such number has been issued:
                19871668481
                and 4455464,
                respectively.

            

    

     

    
      	 	
              VI.

            	
              State
                of Incorporation or Organization of Debtor: Colorado
                and Delaware,
                respectively.

            

    

     

    
      	 	
              VII.

            	
              Debtors’
                mailing address: 420
                Lexington Avenue, Suite 450, New York, NY 10170.

            

    

     

    If
      different from the above mailing address, the address of Debtors’ place of
      business or, if more than one place of business, Debtors’ chief executive
      office: (same
      as above).

     

    
      	 	
              VIII.

            	
              Corporate
                or Administrative Offices of Debtors (including name of State and
                County
                of each location):
                420 Lexington Avenue, Suite 450, New York, NY 10170 (New York
                County).

            

    

     

    
      	 	
              IX.

            	
              Other
                Premises at which Collateral is stored or located (including name
                of State
                and County of each location): 2275
                Rio Bonito Way, Suite 210, San Diego, CA 92108.

            

    

     

    
      	 	
              X.

            	
              Premises
                at which records concerning the Collateral are stored or
                located:
                420 Lexington Avenue, Suite 450, New York, NY 10170 and 2275 Rio
                Bonito
                Way, Suite 210, San Diego, CA 92108.

            

    

     

    
      
        Schedule
          B

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    SCHEDULE
      C

     

    Description
      of Copyrights Issue Date

     

    1)
      LeadX
      software, Registration No. TXu001322825, Registered October 16,
      2006.

     

    2)
      Project Eel software, Registration No. TXu001365605, Registered June 21,
      2007.

     

    
      
        Schedule
          C

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    SCHEDULE
      D

     

    Description
      of Trademark Rights Issue Date

    

      
        	
                Trademark

              	 	
                Serial
                  No.

              	 	
                Registration
                  No.

              	 	
                Reg./(Filing)
                  Date

              
	
                ADAUTHORITY

              	 	
                78/689,589

              	 	
                3,123,465

              	 	
                August
                  1, 2006

              
	
                DOTLOAN.COM

              	 	
                78/689,535

              	 	
                3,191,990

              	 	
                January
                  2, 2007

              
	
                NR
                  LEADS

              	 	
                78/689,622

              	 	
                3,253,014

              	 	
                June
                  19, 2007

              
	
                NRLEADS

              	 	
                78/689,629

              	 	
                3,253,015

              	 	
                June
                  19, 2007

              
	
                LEADX

              	 	
                78/783,348

              	 	
                Allowed
                  for

                Registration

              	 	
                (December
                  30, 2005)

              
	
                THE
                  INSURANCE BOX

              	 	
                77/008,005

              	 	
                3,267,460

              	 	
                July
                  24, 2007

              
	
                THE
                  FINANCE BOX

              	 	
                77/008,000

              	 	
                3,267,459

              	 	
                July
                  24, 2007

              
	
                THE
                  STUDENT BOX

              	 	
                77/007,989

              	 	
                3,267,457

              	 	
                July
                  24, 2007

              
	
                LEND
                  50

              	 	
                77/008,016

              	 	
                3,267,462

              	 	
                July
                  24, 2007

              
	
                MONEY
                  SAVINGS

                SOLUTIONS.

                ALL
                  IN ONE BOX.

              	 	
                77/008,009

              	 	
                3,267,461

              	 	
                July
                  24, 2007

              

      

    

    

    
      
        Schedule
          D

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    SCHEDULE
      E

     

    Description
      of Patent Rights Issue Date

     

    None.

     

    
      
        Schedule
          E

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    SCHEDULE
      F

     

    FILING
      JURISDICTIONS

     

    Colorado

     

    Delaware

     

    New
      York

     

    California

     

    
      
        Schedule
          FNOTE
      PURCHASE
      AGREEMENT

    

    THIS
      NOTE
      PURCHASE AGREEMENT (this “Agreement”)
      is
      made as of the ____ day of April, 2008, by and between Morlex, Inc. (the
“Company”),
      a
      corporation organized under the laws of the State of Colorado, and
      ______________ (the “Purchaser”).
      

    

    IN
      CONSIDERATION of the mutual covenants contained in this Agreement, the Company
      and the Purchaser hereby agree as follows: 

    

    SECTION
      1. Agreement
      to Sell and Purchase Notes.
      Subject
      to the terms and conditions of this Agreement, and in reliance upon the
      representations and warranties of each of the parties to each other, the Company
      hereby agrees to sell and issue to the Purchaser, and the Purchaser hereby
      agrees to purchase from the Company, Junior Convertible Unsecured Notes of
      the
      Company, substantially in the form attached hereto as Exhibit
      A
      (the
“Junior
      Convertible Notes”),
      in
      the principal amount as set forth on the signature page to this Agreement (the
      “Principal
      Amount”).

    

    SECTION
      2. Payment
      for and Delivery of Notes; Closing.
      

    

    (a) The
      purchase price for the Junior Convertible Notes (the “Purchase
      Price”)
      shall
      be the Principal Amount thereof set forth on the signature page to this
      Agreement. The Purchaser will pay the Purchase Price to the Company by cashier’s
      check or wire transfer of immediately available funds, as directed by the
      Company, at the Closing. Upon receipt by the Company of the Purchase Price,
      the
      Company shall deliver to the Purchaser the Junior Convertible Notes in the
      Principal Amount.

    

    (b)The
      closing of the purchase and sale of the Junior Convertible Notes pursuant to
      this Agreement (the “Closing”),
      shall
      occur on or before April [__], 2008, upon the satisfaction of the closing
      conditions set forth in Article 5 below, at the offices of Nixon Peabody LLP,
      437 Madison Avenue, New York, New York, 10022 or at such other time and/or
      location as the parties shall mutually agree. 

    

    SECTION
      3. Representations
      and Warranties of the Company.
      The
      Company hereby represents and warrants to the Purchaser as follows:

    

    3.1 Organization
      and Qualification.
       The
      Company is a corporation duly organized, validly existing and in good standing
      under the laws of the State of Colorado. The Company has the requisite corporate
      power and authority to carry on its business as it is now being conducted and
      is
      duly qualified or licensed to do business, and is in good standing, in each
      jurisdiction where the character of its properties owned or held under lease
      or
      the nature of its activities makes such qualification necessary, except for
      any
      failure to so license, qualify or be in such good standing, which, when taken
      together with all other such failures, has not had and does not have a material
      adverse effect on the Company. 

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    3.2 Capitalization.
      The
      authorized capital stock of the Company consists of 1,000,000,000 shares of
      common stock, par value $.001 per share (the “Company
      Common Stock”).
      As of
      the date of this Agreement, the Company has 1,501,765 shares of Company Common
      Stock issued and 1,280,160 shares of Company Common Stock outstanding, all
      of
      which have been duly authorized, validly issued, fully paid and non-assessable.
      After giving effect to the Merger Transactions (as defined in
      Section 5.1(d)), the Company will have 20,045,492 shares of Company Common
      Stock issued and outstanding, all of which will have been duly authorized,
      validly issued, fully paid and non-assessable. The Company Common Stock is
      presently eligible for quotation and trading on the Over-the-Counter Bulletin
      Board (the “OTCBB”)
      in all
      50 states of the United States and is not subject to any notice of suspension
      or
      delisting. 
      The
      Company Common Stock is eligible for registration under the Securities Exchange
      Act of 1934, as amended (the “Exchange
      Act”).
      All
      of the issued and outstanding shares of Company Common Stock were issued in
      compliance with all applicable laws including, without limitation, the
      Securities Act of 1933, as amended (the “Securities
      Act”),
      the
      Exchange Act and applicable “blue sky laws”. Except as set forth on Schedule
      3.2
      of the
      Disclosure Schedule, there are no preemptive or other outstanding rights,
      options, warrants, conversion rights (including pursuant to convertible
      securities), stock appreciation rights, redemption rights, repurchase rights,
      registration rights, agreements, arrangements, calls, commitments or rights
      of
      any kind relating to the issued or unissued capital stock of the Company or
      obligating the Company to issue or sell any shares of capital stock of, or
      other
      equity interests in, the Company. As of the date of this Agreement, there are
      no
      outstanding contractual obligations of the Company to repurchase, redeem or
      otherwise acquire any shares of capital stock of the Company or to provide
      material funds to, or make any
      material investment (in the form of a loan, capital contribution or otherwise)
      in, any person.

     

    3.3
       Authority
      Relative to this Agreement.
      The
      Company has all necessary power and authority to execute and deliver this
      Agreement, the Junior Convertible Note and the Registration Rights Agreement,
      substantially in the form attached hereto as Exhibit
      B
      (the
“Registration
      Rights Agreement”),
      to
      perform its obligations hereunder and to consummate the transactions
      contemplated hereby to which it is a party. The execution and delivery of this
      Agreement and the Junior Convertible Note by the Company, and the consummation
      by the Company of the transactions contemplated hereby and thereby have been
      duly and validly authorized by all necessary corporate action and no other
      corporate proceedings on the part of the Company are necessary to authorize
      the
      execution and delivery of this Agreement or the Junior Convertible Note or
      to
      consummate the transactions contemplated pursuant to this Agreement or the
      Junior Convertible Note. This Agreement has been duly and validly executed
      and
      delivered by the Company and, assuming the due authorization, execution and
      delivery hereof by the Purchaser, constitutes a legal, valid and binding
      obligation of the Company, enforceable against the Company in accordance with
      its terms and, when executed by the Company at the closing, each of the Junior
      Convertible Note and the Registration Rights Agreement will have been duly
      and
      validly executed and delivered by the Company, and will constitute a legal,
      valid and binding obligation of the Company, enforceable against the Company
      in
      accordance with its terms, except, in each case, to the extent such
      enforceability may be limited by (i) laws relating to specific performance,
      injunctive relief or other equitable remedies and (ii) applicable bankruptcy,
      insolvency, reorganization, moratorium or other laws of general application
      relating to or affecting the enforcement of creditors’ rights
      generally.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    3.4
       No
      Conflicts, Required Filings and Consents.
      The
      execution and delivery of this Agreement, the Junior Convertible Note and the
      Registration Rights Agreement by the Company does not and will not, and the
      performance of this Agreement, Junior Convertible Note and the Registration
      Rights Agreement by the Company will not: (i) conflict with or violate the
      articles of incorporation or by-laws of the Company, (ii) conflict with or
      violate any laws applicable to the Company or by which any property or asset
      of
      the Company is bound or affected, or (iii) result in any breach of or constitute
      a default (or an event which with notice or lapse of time or both would become
      a
      default) under, or give to others any right of termination, amendment,
      acceleration, or cancellation of, or result in the creation of a lien or other
      encumbrance on any property or asset of the Company pursuant to, any contract
      to
      which the Company is a party or by which the Company or any property or asset
      of
      the Company is bound or affected.

     

    3.5
       SEC
      Reports.
      The
      Company has filed with the Securities and Exchange Commission (the “SEC”)
      all
      forms, reports, schedules, registration statements and preliminary or definitive
      proxy or information statements required to be filed by it with the SEC since
      December 31, 2005 (such reports, the “Company
      SEC Reports”).
      As of
      their respective dates, the Company SEC Reports complied as to form in all
      material respects with the requirements of the Exchange Act or the Securities
      Act, as the case may be, and the rules and regulations of the SEC thereunder
      applicable to such Company SEC Reports. As of their respective dates of filing,
      all SEC Reports filed by the Company did not contain any untrue statement of
      a
      material fact or omit to state a material fact required to be stated therein
      or
      necessary to make the statements therein, in light of the circumstances under
      which they were made, not misleading. The Company has filed all material
      contracts and agreements and other documents or instruments required to be
      filed
      as exhibits to the Company SEC Reports. 

     

    3.6
       Compliance
      with Laws.
       Except
      as
      set forth in Schedule
      3.6
      of the
      Disclosure Schedule: (a) the Company is in compliance in all material respects
      with each law that is or was applicable to it or to the conduct or operation
      of
      its business or the ownership or use of any of its assets; and (b) the Company
      has not received any notice or other communication (whether oral or written)
      from any governmental entity or any other person regarding any actual, alleged,
      possible, or potential violation of or failure on the part of the Company to
      comply in all material respects with, any law. Except as set forth in
Schedule
      3.6
      of the
      Disclosure Schedule, the Company holds and maintains in full force and effect
      all material governmental authorizations required to conduct its business in
      the
      manner and in all such jurisdictions as it is currently conducted and to permit
      it to own and use its properties and assets in the manner in which it currently
      owns and uses such assets.

     

    3.7
       Litigation.
      Except
      as set forth on Schedule
      3.7
      of the
      Disclosure Schedule, there is no suit, action or proceeding pending or, to
      the
      Company’s knowledge, threatened against the Company, nor is there any judgment,
      decree, injunction or order of any governmental entity or arbitrator outstanding
      against the Company.

     

    3.8
       Brokers.
      No
      agent, broker, finder, investment banker or other firm or person is or will
      be
      entitled to any broker’s or finder’s fee or other similar commission or fee in
      connection with the transactions contemplated by this Agreement based upon
      arrangements made by or on behalf of the Company

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    3.9 Taxes.
      The
      Company has filed in a timely manner all federal, state and local tax returns
      that it has been required to file, and has paid in a timely manner all taxes
      shown thereon as owing. The Company has not incurred any tax liabilities except
      in the ordinary course of business. The Company knows of no tax deficiency
      or
      claim for additional taxes asserted or threatened to be asserted against Company
      by any taxing authority or any grounds for any such assessment.

    

    3.10 Sole
      Representations and Warranties.
      Except
      for the representations and warranties contained in this Section 3, the Company
      makes no representation or warranty to the Purchaser, express or implied, in
      connection with the transactions contemplated by this Agreement.

    

    SECTION
      4. Representations
      and Warranties of the Purchaser.
      The
      Purchaser represents and warrants to the Company as follows:

    

    4.1 Authority
      Relative to this Agreement.
      The
      Purchaser has all necessary power and authority to execute and deliver this
      Agreement to perform its obligations hereunder and to consummate the
      transactions contemplated hereby to which it is a party. The execution and
      delivery of this Agreement by the Purchaser, and the consummation by the
      Purchaser of the transactions contemplated hereby have been duly and validly
      authorized by all necessary corporate action and no other corporate proceedings
      on the part of the Purchaser are necessary to authorize the execution and
      delivery of this Agreement or to consummate the transactions contemplated by
      this Agreement. This Agreement has been duly and validly executed and delivered
      by the Purchaser and, assuming the due authorization, execution and delivery
      hereof by the Company, constitutes a legal, valid and binding obligation of
      the
      Purchaser, enforceable against the Purchaser in accordance with its terms,
      except, in each case, to the extent such enforceability may be limited by (i)
      laws relating to specific performance, injunctive relief or other equitable
      remedies and (ii) applicable bankruptcy, insolvency, reorganization, moratorium
      or other laws of general application relating to or affecting the enforcement
      of
      creditors’ rights generally.

    

    4.2 No
      Conflicts, Required Filings and Consents.
      The
      execution and delivery of this Agreement by the Purchaser does not and will
      not,
      and the performance of this Agreement by the Purchaser will not: (i) conflict
      with or violate the articles of incorporation or by-laws of the Purchaser,
      (ii)
      conflict with or violate any laws applicable to the Purchaser or by which any
      property or asset of the Purchaser is bound or affected, or (iii) result in
      any
      breach of or constitute a default (or an event which with notice or lapse of
      time or both would become a default) under, or give to others any right of
      termination, amendment, acceleration, or cancellation of, or result in the
      creation of a lien or other encumbrance on any property or asset of the
      Purchaser pursuant to, any contract to which the Purchaser is a party or by
      which the Purchaser or any property or asset of the Purchaser is bound or
      affected.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    4.3 No
      Actions.
      There
      are no legal or governmental actions, suits or proceedings pending or, to the
      Purchaser’s knowledge, threatened to which the Purchaser is or may be a party
      which seeks to prevent or restrain the transactions contemplated hereby or
      to
      recover damages as a result of the consummation of such transactions. The
      Purchaser has not been and is not currently the subject of an investigation
      or
      inquiry by the SEC, the Financial Industry Regulatory Authority or any state
      securities commission.

    

    4.4 Qualifications
      of Purchaser.
      The
      Purchaser is knowledgeable, sophisticated and experienced in making, and is
      qualified to make, decisions with respect to investments in securities
      representing an investment decision like that involved in the purchase of the
      Junior Convertible Notes and has the capacity to protect its own interests.
      The
      Purchaser is aware that an investment in the Junior Convertible Notes is highly
      speculative and that there can be no assurance as to what return, if any, there
      may be in such investment. At
      the time the Purchaser was offered the Junior Convertible Notes, the Purchaser
      was, and at the date hereof is, and on the date of the Closing will be, an
      “accredited investor,” as defined in Regulation D under the Securities
      Act. 

    

    4.5 Access
      to Information.
      The
      Purchaser has requested, received, reviewed and considered all information
      it
      deems relevant in making an informed decision to invest in the Junior
      Convertible Notes, including without limitation, all information with respect
      to
      the Merger Transactions. The Purchaser understands that the Company is still
      in
      the development stage and does not have operating revenues. 

    

    4.6 Investment
      Intent.
      The
      Purchaser is acquiring the Junior Convertible Notes in the ordinary course
      of
      its business and for its own account for investment only and with no present
      intention of reselling or distributing any of the Junior Convertible Notes,
      any
      interest in any of the Junior Convertible Notes or any shares of Company Common
      Stock issuable upon conversion thereof, or entering into any arrangement or
      understanding with any other person regarding such a resale or distribution.
      The
      Purchaser is able to bear the economic risks associated with the Purchaser’s
      investment in the Junior Convertible Notes, including the potential loss of
      the
      Purchaser’s entire investment.

    

    4.7 General
      Solicitation.
      The
      Purchaser is not purchasing the Junior Convertible Notes as a result of any
      advertisement, article, notice or other communication regarding the Junior
      Convertible Notes published in any newspaper, magazine or similar media or
      broadcast over television or radio or presented at any seminar or any other
      general solicitation or general advertisement.

    

    4.8 Sole
      Representations and Warranties.
      Except
      for the representations and warranties contained in this Section 4, the
      Purchaser makes no representation or warranty to the Company, express or
      implied, in connection with the transactions contemplated by this
      Agreement.

    

    SECTION
      5.  Closing
      Conditions.

    

    5.1 Conditions
      to the Obligations of the Company.
      The
      obligations of the Company hereunder in connection with the Closing are subject
      to the following conditions being met: 

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

      (a)
      the
      accuracy in all material respects when made and on the Closing of the
representations
      and
      warranties of the Purchaser contained herein; 

     

      (b)
      all
      obligations, covenants and agreements of the Purchaser required to be performed
      at or prior to the Closing shall have been performed; 

     

      (c)
      the
      simultaneous issuance and sale by the Company of junior convertible unsecured
      notes in the principal amount, together with the Principal Amount of the Junior
      Convertible Notes sold pursuant to this Agreement, of at least $1,000,000;
      

     

      (d)
      the
      conditions to the consummation of the transactions contemplated pursuant to
      that
      certain (i) Agreement and Plan of Merger among the Company, RHI Merger Sub,
      Inc., and Rightside Holdings, Inc., dated as of February 7, 2007, and (ii)
      Agreement and Plan of Merger among the Company, DMG Merger Sub, Inc., and Duncan
      Media Group, Inc., dated as of February 7, 2007 (collectively, the “Merger
      Transactions”),
      shall
      have been satisfied or waived, and the Merger Transactions shall have been
      consummated immediately following the Closing; and

     

      (e)
      the
      Purchaser shall have delivered the Purchase Price to the Company.

     

    5.2
       Conditions
      to the Obligations of the Purchaser.
      The
      obligations of the Purchaser hereunder in connection with the Closing are
      subject to the following conditions being met: 

    

      (a)
      the
      accuracy in all material respects on the Closing of the representations and
      warranties of the Company contained herein; 

     

      (b)
      all
      obligations, covenants and agreements of the Company required to be performed
      at
      or prior to the Closing shall have been performed; 

     

      (c)
      the
      conditions to the consummation of the Merger Transactions shall have been
      satisfied or waived, and the Merger Transactions shall have been consummated
      immediately following the Closing;
      

     

      (d)
      the
      Company and the Purchaser shall have entered into a Registration Rights
      Agreement; and

     

      (e)the
      Company shall have executed and delivered Junior Convertible Notes in the
      Principal Amount to the Purchaser.

     

    SECTION
      6. Covenants.

    

    6.1 Resale
      Restrictions. The
      Purchaser acknowledges and understands that the Junior Convertible Notes and
      the
      shares of Company Common Stock issuable upon conversion of the Junior
      Convertible Notes (the “Shares”
and,
      together with the Junior Convertible Notes, the “Securities”)
      are
      "restricted securities" as defined in Rule 144 under the Securities Act and
      that
      a legend to such effect will be placed on the certificates representing any
      of
      the Securities. The Purchaser hereby agrees not to offer or sell (as such terms
      are defined in the Securities Act and the rules and regulations promulgated
      thereunder) any of the Securities unless such offer or sale is made (i) pursuant
      to an effective registration under the Securities Act, or (ii) pursuant to
      an
      available exemption from the registration requirements of the Securities Act.
      The Purchaser agrees that it will not engage in hedging transactions with regard
      to the Security other than in compliance with the Securities Act. A proposed
      transfer shall be deemed to comply with this Section 6.1 if the Purchaser
      delivers to the Company a legal opinion in form and substance satisfactory
      to
      the Purchaser from counsel satisfactory to the Purchaser to the effect that
      such
      transfer complies with this Section 6.1.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    6.3 Drag
      Along Rights.
      The
      Purchaser agrees to be bound by drag-along rights whereby if a majority of
      the
      holders of the Company Common Stock agree to a merger, consolidation, sale
      of a
      majority of the shares of Company Common Stock or of all or substantially all
      of
      its assets, or liquidation of the Company, the Purchaser shall consent to and
      raise no objections to any such transaction; provided that all shareholders
      of
      each class of the Company’s capital stock receive the same consideration per
      share.

     

    SECTION
      7. Notices.
      All
      notices, requests, consents and other communications hereunder shall be in
      writing, shall be mailed by first-class registered or certified mail, confirmed
      facsimile or nationally recognized overnight express courier postage prepaid,
      and shall be deemed given when so mailed and shall be delivered as addressed
      as
      follows: 

    

    
      	
            	(a)	
              if
                to the Company, to:

            

    

    

    Morlex,
      Inc.

    420
      Lexington Avenue

    Suite
      450

    New
      York,
      NY 10170 

    Attention:
      Richard Berman

    Telephone:
      (212) 581-5150

    Facsimile:
      (212) 581-5198 

    

    with
      a
      copy to:

    

    Nixon
      Peabody LLP

    437
      Madison Avenue 

    New
      York,
      New York 10022

    Attention:
      Jane Greyf, Esq..

    Telephone:
      (212) 940-3155

    Facsimile:
      (866) 516-0358

     

    
      	 	 	
              or
                to such other person at such other place as the Company shall designate
                to
                the Purchaser in writing; and

            

    

    

    
      	 	
              (b)

            	
              if
                to the Purchaser, to the address of the Purchaser set forth on the
                signature page of this Agreement or to such other person at such
                other
                place as the Purchaser shall designate to the Company in
                writing.

            

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    SECTION
      8. Assignment.
      Neither
      party hereto may assign or delegate any of such party’s rights or obligations
      under or in connection with this Agreement, and any attempted assignment or
      delegation of such rights or obligations shall be void. No person, including
      without limitation any person who purchases or otherwise acquires or receives
      any Shares from the Purchaser, is an intended third party beneficiary of this
      Agreement, and no party to this Agreement shall have any obligation arising
      under this Agreement to any person other than the other party
      hereto.

    

    SECTION
      9. Changes.
      This
      Agreement may not be modified or amended except pursuant to an instrument in
      writing signed by the Company and the Purchaser. 

    

    SECTION
      10 . Headings.
      The
      headings of the various sections of this Agreement have been inserted for
      convenience of reference only and shall not be deemed to be part of this
      Agreement.

    

    SECTION
      11. Severability.
      In case
      any provision contained in this Agreement should be invalid, illegal or
      unenforceable in any respect, the validity, legality and enforceability of
      the
      remaining provisions contained herein shall not in any way be affected or
      impaired thereby. 

    

    SECTION
      12. Governing
      Law.
      This
      Agreement shall be governed by and construed in accordance with the laws of
      the
      State of New York applicable to contracts executed within such state.

    

    SECTION
      13. Counterparts.
      This
      Agreement may be executed in two or more counterparts, each of which shall
      constitute an original, but all of which, when taken together, shall constitute
      but one instrument, and shall become effective when one or more counterparts
      have been signed by each party hereto and delivered to the other
      parties.

    

    [Remainder
      of Page Intentionally Blank]

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    IN
      WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
      by
      their duly authorized representatives as of the day and year first above
      written.

     

    
      	
              Morlex,
                Inc.

            
	 	 
	
              By:
                

            	 
              
	
              Name:

            	 
	
              Title:
                

            	 
	 	 
	
              Purchaser:

            

    

     

    
      	 	
            

    

     

    
      	 	 
	
              By:
                

            	 

	
              Name:

            	 
	
              Title:
                

            	 

    

     

    
      	
              Principal Amount:

            	
               

            
	 	 
	
              Purchaser Address:

            	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    Exhibit
      A

    

    Form
      of
      Junior Convertible Note

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    Exhibit
      B

    

    Form
      of
      Registration Rights Agreement

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