EXHIBIT 10.16





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     UNIFORM COMMERCIAL CODE FINANCING STATEMENT Texas - Secretary of State
                                 (Non-Standard)

1.       This  Financing  Statement is presented to a Filing  Officer for filing
         pursuant to the Uniform Commercial Code

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         For Filing Officer
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         Date:                                 Time:
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         Filing Officer:                         [Official Stamp]
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2.       Debtor's Name and Mailing Address:

         Avatar Systems, Inc.
         5728 LBJ Freeway
         Suite 270
         Dallas, Texas 75240

3.       Secured Party's Name and Mailing Address:

         Bank One, Texas, N.A.
         1717 Main Street
         Dallas, Texas 75201
         Attention:        Reed V. Thompson
                           Vice President
         EIN: 75-2270994

4.       This  financing   statement   covers  that  certain   Collateral   more
         particularly described on Exhibit "A" attached hereto.

5.       Products and proceeds of Collateral are also covered hereby.

         SECURED PARTY:                           DEBTOR:

         Bank One Texas, N.A.                     Avatar Systems, Inc.


         By:      /s/ Reed V. Thompson            By: /s/ Robert C. Shreve, Jr.
             ----------------------------           ----------------------------
         Name:    Reed V. Thompson                Name:    Robert C. Shreve, Jr.
         Title:   Vice President                  Title:   President

RETURN TO:
Gardere & Wynne, L.L.P.
1601 Elm Street, Suite 3000
Dallas, Texas 75201
Attention: Sandra Tomlinson

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                                   EXHIBIT "A"
                                       TO
                            UCC-1 FINANCING STATEMENT


Debtor:           Avatar Systems, Inc.

Secured Party:    Bank One, Texas, N.A.

Debtor hereby assigns and grants to Secured Party a continuing security interest
in and to all right,  title and  interest of Debtor in the  following  property,
whether now owned or existing or hereafter acquired or arising and regardless of
where located (all being collectively referred to as the "Collateral"):

                  (A) Accounts;

                  (B) Inventory;

                  (C) General Intangibles;

                  (D) Documents;

                  (E) Instruments;

                  (F) Equipment;

                  (G) Fixtures;

                  (H) all Investment Property and Financial Assets-,

                  (I) all deposit accounts of Debtor maintained with any bank or
         financial institution;

                  (J) the Collateral  Account,  all cash deposited  therein from
         time to time and other monies and property of Debtor in the  possession
         or under the control of Secured Party;

                  (K) all books,  records  (including  maintenance  and warranty
         records),  ledger  cards,  files,  correspondence,  computer  programs,
         tapes,  disks and related  data  processing  software  that at any time
         evidence  or  contain  information  relating  to any  of  the  property
         described  in subparts  (A) - (J) above or are  otherwise  necessary or
         helpful in the collection thereof or realization thereon; and

                  (L)  products  and  Proceeds  of all  or  any of the  property
         described in subparts (A) - (K) above.

         "Accounts"  means all  "accounts"  (as defined in the UCC) now owned or
hereafter created or acquired by Debtor including,  without  limitation,  all of
the following now owned or hereafter created or acquired by Debtor: (a) accounts
receivable,  contract rights, book debts, notes, drafts and other obligations or
indebtedness  owing to Debtor arising from the sale,  lease or exchange of goods
or other property and/or the performance of services; (b) Debtor's rights in, to
and under all  purchase  orders  for  goods,  services  or other  property;  (c)
Debtor's rights to any goods,  services or other property  represented by any of
the  foregoing  (including  returned or  repossessed  goods and unpaid  sellers'
rights of rescission,  replevin, reclamation and rights to stoppage in transit);
(d) monies due to or to become due to Debtor under all  contracts  for the sale,
lease or exchange of goods or other property  and/or the performance of services
(whether  or not yet  earned  by  performance  on the part of  Debtor);  and (e)
Proceeds (as defined below) of any of the foregoing and all collateral  security
and  guaranties  of any kind  given by any  Person  with  respect  to any of the
foregoing.


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         "Documents"  means all  "documents"  (as  defined  in the UCC) or other
receipts  covering,  evidencing  or  representing  goods now owned or  hereafter
acquired by Debtor.

         "Equipment"  means all "equipment" (as defined in the UCC) now owned or
hereafter  acquired by Debtor  including,  without  limitation,  all  computers,
computer  components  and  other  computer  hardware,  printers,  communications
equipment,  office  equipment,  machinery,  motor  vehicles,  trucks,  trailers,
vessels,  aircraft and rolling stock and all parts thereof and all additions and
accessions thereto and replacements therefor.

         "Financial  Assets"  means all  "financial  assets"  (as defined in the
UCC), now owned or hereafter acquired by Debtor.

         "Fixtures"  means all  "Fixtures"  (as defined in the UCC) now owned or
hereafter acquired by Debtor including,  without limitation, all plant Fixtures;
business  Fixtures;  other  Fixtures  and storage  office  facilities,  wherever
located; and all additions and accessions thereto and replacements therefor.

         "General  Intangibles"  means all "general  intangibles" (as defined in
the  UCC)  now  owned  or  hereafter  acquired  by  Debtor,  including,  without
limitation,  all  right,  title  and  interest  of  Debtor  in and  to:  (a) all
agreements,  leases,  licenses and  contracts to which Debtor is or may become a
party  (excluding any such  agreements,  leases,  licenses  including  Trademark
Licenses,  Copyright  Licenses and Patent Licenses and contracts to which Debtor
is a party as of the date hereof and any renewals or  extension  thereof (but in
any event not excluding Accounts) if and to the extent that any attempt to grant
a security  interest  hereunder  in any such  agreements,  leases,  licenses and
contracts without the consent of a third party would constitute a breach thereof
and such consent has not been obtained by Debtor and those  agreements,  leases,
licenses  and  contracts  for ` which Debtor may become a party and consent to a
grant of a  security  interest  is  required  and cannot be  obtained);  (b) all
obligations or indebtedness  owing to Debtor (other than Accounts) from whatever
source arising, including, without limitation, any obligations owed to Debtor by
third  parties in  connection  with the  agreements  relating to the clean up of
Hazardous  Materials or compliance with Environmental Laws; (c) all tax refunds;
(d) Intellectual  Property;  (e) computer  software,  source code,  object code,
manuals  and  instructions,  together  with all  diskettes,  tape and any  other
physical representation or eminent thereof-, and (f) all trade secrets and other
confidential  information relating to the business of Debtor including by way of
illustration  and not  limitation:  systems  and  techniques  for the  analysis,
diagnosis and correction of malfunctions of products used by Debtor's customers;
the  names  and  addresses  of,  and  credit  and  other  business   information
concerning,  Debtor's past, present or future customers; the prices which Debtor
obtains for its services or at which it sells  merchandise;  estimating and cost
procedures;  profit margins;  policies and procedures pertaining to the sale and
design of  equipment,  components,  devices and  services  furnished  by Debtor;
information  concerning  suppliers of Debtor;  and  information  concerning  the
manner  of  operation,  business  plans,  pledges,  projections,  and all  other
information  of any kind or character,  whether or not reduced in writing,  with
respect to the  conduct by Debtor of its  business  not  generally  known by the
public. The term "General Intangibles" excludes any software licenses or similar
licenses  that are not  permitted  to be  pledged in  accordance  with the terms
thereof.


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         "Instruments"  means all "instruments",  "chattel paper" or "letters of
credit" (each as defined in the UCC) including,  but not limited to,  promissory
notes, drafts,  bills of exchange and trade acceptances,  now owned or hereafter
acquired by Debtor.

         "Inventory" means all "inventory" (as defined in the UCC), now owned or
hereafter acquired by Debtor,  wherever located including,  without  limitation,
finished goods, raw materials,  work in process and other materials and supplies
(including packaging and shipping materials) used or consumed in the manufacture
or production thereof and goods which are returned to or repossessed by Debtor.

         "Investment  Property" means all  "investment  property" (as defined in
the  UCC),  now  owned or  hereafter  acquired  by  Debtor,  including,  without
limitation,   all  securities   (certificated  or  uncertificated),   securities
accounts, securities entitlements, commodity contracts and commodity accounts.

         "Proceeds"  means all  proceeds of, and all other  profits,  rentals or
receipts, in whatever form, arising from the collection,  sale, lease, exchange,
assignment,  licensing  or  other  disposition  of,  or  realization  upon,  any
Collateral  including,  without  limitation,  all claims of Debtor against third
parties for loss of, damage to or destruction of, or for proceeds payable under,
or unearned  premiums with respect to, policies of insurance with respect to any
Collateral,  and any  condemnation  or requisition  payments with respect to any
Collateral, in each case whether now existing or hereafter arising.

         "UCC" means the Uniform Commercial Code as in effect on the date hereof
in the State of Texas, as amended from time to time, and any successor  statute;
provided that if by reason of mandatory provisions of law, the perfection or the
effect  of  perfection  or  non-perfection  of  the  Security  Interest  in  any
Collateral is governed by the Uniform  Commercial  Code as in effect on or after
the date hereof in any other  jurisdiction,  "UCC" means the Uniform  Commercial
Code as in effect in such  other  jurisdiction  for  purposes  of the  provision
hereof relating to such perfection or effect of perfection or non-perfection.


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