EXHIBIT 10.5




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         THIS WARRANT AND THE SHARES OF COMMON STOCK  ISSUABLE UPON ITS EXERCISE
HAVE NOT BEEN  REGISTERED  UNDER THE  SECURITIES  ACT OF 1933,  AS AMENDED  (THE
"ACT"),  OR THE  SECURITIES  LAWS OF ANY STATE AND MAY NOT BE SOLD,  OFFERED FOR
SALE,  PLEDGED OR  HYPOTHECATED  OR  OTHERWISE  TRANSFERRED  IN THE ABSENCE OF A
REGISTRATION  STATEMENT IN EFFECT WITH RESPECT TO THE SECURITIES  UNDER SAID ACT
AND ALL OTHER APPLICABLE  SECURITIES LAWS OR ANY OPINION OF COUNSEL SATISFACTORY
TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.

No. W - 002                                  Warrant to Purchase up to 1,600,000
                                                          Shares of Common Stock
Date:  July 10, 2000                                     (subject to adjustment)


                        WARRANT TO PURCHASE COMMON STOCK
                                       OF
                              AVATAR SYSTEMS, INC.

                            Void after July 10, 2005

         This certifies  that,  for value  received,  Robert C. Shreve,  Jr., or
registered assigns  ("Holder") is entitled,  subject to the terms and conditions
set forth below, to purchase from Avatar Systems, Inc. (the "Company"),  a Texas
corporation, 1,600,000 shares of Common Stock (or such other number of shares of
Common Stock as may be determined in  accordance  with Section 2 hereof),  $1.00
par value,  of the Company  (the "Common  Stock"),  as  constituted  on the date
hereof (the  "Original  Issue Date"),  upon surrender  hereof,  at the principal
office of the Company  referred to below,  with the  subscription  form attached
hereto duly executed,  and simultaneous  payment therefor in lawful money of the
United States or otherwise as hereinafter provided, at the Exercise Price as set
forth in Section 2 below.  The  number,  character  and  Exercise  Price of such
shares of Common Stock are subject to  adjustment  as provided  below.  The term
"Warrant" as used herein shall include this Warrant, which is one of a series of
warrants issued for the Common Stock of the Company,  and any warrants delivered
in substitution or exchange therefor as provided herein.

         This Warrant is issued in connection with the transactions described in
the  Stock  Purchase  Agreement  between  Company  and  Cybertec  Holdings,  Plc
("Cybertec"),  dated as of July 10,  2000  (the  "Purchase  Agreement").  Unless
otherwise  defined herein,  capitalized  terms shall have the same meaning as in
the Purchase  Agreement.  Pursuant to the Purchase  Agreement and the Management
Agreement  between  the Company and Robert C.  Shreve,  Jr.,  the Holder of this
Warrant was issued this Warrant to purchase  1,600,000  shares of the  Company's
Common Stock. The Holder of this Warrant is subject to certain  restrictions set
forth in the  Shareholders'  Agreement  dated July 10, 2000 between the Company,
Cybertec,  Merchants  Capital  Holdings,  Ltd.,  Stephen A.  Komlosy,  Robert C.
Shreve, Jr., Tim Allen and Gregg Allen (the "Shareholders' Agreement"),  and the
Purchase  Agreement,  and shall be entitled to certain rights and privileges set
forth in the Purchase Agreement. This Warrant is one of the Warrants referred to
as the "Warrants" in the Purchase Agreement.

Warrant To Purchase Common Stock - Page 1

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         1. Term of  Warrant.  Subject  to the terms  and  conditions  set forth
herein, this Warrant shall be exercisable,  in whole or in part, during the term
("Term")  commencing  at 9:00 a.m.,  Dallas,  Texas time, on the date hereof and
ending at 5:00 p.m.,  Dallas,  Texas time,  on July 10, 2005,  and shall be void
thereafter.  Robert C. Shreve,  Jr., Tim Allen and Gregg  Allen,  directors  and
shareholders of the Company,  have provided their personal  guarantee of certain
indebtedness of the Company owed to Bank One, N.A., Dallas,  Texas. This Warrant
shall not be exercisable in whole or in part until all such personal  guarantees
shall have been released by Bank One, N.A.,  Dallas,  Texas or such indebtedness
subject to the personal guarantees shall have been fully paid.

         2.  Exercise  Price and Number of Shares.  The Exercise  Price at which
this  Warrant may be  exercised  shall be $1.00 per share of Common  Stock.  The
Exercise Price is subject to adjustment from time to time pursuant to Section 11
hereof.

         3. Exercise of Warrant.

                  (a) Manner of Exercise.  The purchase  rights  represented  by
         this Warrant are  exercisable by the Holder in whole or in part, at any
         time,  or from time to time,  during the term  hereof as  described  in
         Section 1 above,  by the  surrender  of this  Warrant and the Notice of
         Exercise  annexed  hereto duly  completed and executed on behalf of the
         Holder, at the office of the Company (or such other office or agency of
         the Company as it may  designate  by notice in writing to the Holder at
         the address of the Holder appearing on the books of the Company),  upon
         payment  (i) in cash or by check  acceptable  to the  Company,  (ii) by
         cancellation  by the  Holder  of  indebtedness  of the  Company  to the
         Holder,  or (iii) by a combination  of (i) and (ii), in an amount equal
         to the purchase  price of the shares to be purchased.  This Warrant may
         not be  exercised  in  whole  or in part  without  compliance  with all
         applicable  federal and state securities laws by the Holder  (including
         the delivery of investment  representation  letters and legal  opinions
         reasonably  satisfactory  to the Company,  if such are requested by the
         Company.)

                  (b) Time of  Exercise.  This  Warrant  shall be deemed to have
         been exercised  immediately  prior to the close of business on the date
         of its  surrender  for  exercise  as  provided  above,  and the  person
         entitled  to receive  the  shares of Common  Stock  issuable  upon such
         exercise  shall be treated for all  purposes as the holder of record of
         such shares as of the close of  business  on such date.  As promptly as
         practicable  on or after  such  date and in any  event  within  10 days
         thereafter,  the Company at its expense,  will issue and deliver to the
         person  or  persons  entitled  to  receive  the same a  certificate  or
         certificates  for the number of shares issuable upon such exercise.  In
         the event that this Warrant is  exercised  in part,  the Company at its
         expense,  shall  execute  and  deliver  a new  Warrant  of  like  tenor
         exercisable for the number of shares for which this Warrant may then be
         exercised.

                  (c) Net Issue Exercise.  Notwithstanding any provisions herein
         to the  contrary,  if the Fair Market Value (as defined  herein) of one
         share of Common Stock is greater  than the Exercise  Price (at the date
         of calculation as set forth below),  in lieu of exercising this Warrant
         for cash, the holder may elect to receive shares equal to the value (as
         determined  below)  of this  Warrant  (or  the  portion  thereof  being
         canceled) by surrender of this Warrant at the  principal  office of the
         Company  together  with the  properly  endorsed  Notice of Exercise and
         notice of such  election in which event the Company  shall issue to the
         Holder a number of shares of Common Stock  computed using the following
         formula:

Warrant To Purchase Common Stock - Page 2

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                                    Y (A-B)
                                    -------
                           X =          A

                             X =    the  number of shares of Common  Stock to be
                                    issued to the Holder

                             Y =    the   number  of  shares  of  Common   Stock
                                    purchasable  under the Warrant or, if only a
                                    portion of the  Warrant is being  exercised,
                                    the number of shares  subject to the Warrant
                                    being   exercised   (at  the  date  of  such
                                    calculation)

                             A =    the fair  market  value of one  share of the
                                    Company's  Common Stock (at the date of such
                                    calculation)

                             B =    Exercise  Price (as  adjusted to the date of
                                    such calculation)

         4. No  Fractional  Shares  or  Scrip.  No  fractional  shares  or scrip
representing  fractional  shares  shall  be  issued  upon the  exercise  of this
Warrant.  In lieu of any fractional share to which the Holder would otherwise be
entitled,  the Company  shall make a cash payment  equal to the  Exercise  Price
multiplied by such fraction.

         5.   Replacement  of  Warrant.   On  receipt  of  evidence   reasonably
satisfactory  to the Company of the loss,  theft,  destruction  or mutilation of
this Warrant and, in the case of loss,  theft or destruction,  on delivery of an
affidavit of loss and indemnity  agreement  reasonably  satisfactory in form and
substance  to the  Company  or,  in the case of  mutilation,  on  surrender  and
cancellation  of this  Warrant,  the  Company at its expense  shall  execute and
deliver, in lieu of this Warrant, a new warrant of like tenor and amount.

         6.  Rights  of  Stockholders.  Subject  to  Sections  9 and 11 of  this
Warrant,  the Holder  shall not be entitled to vote or receive  dividends  or be
deemed the holder of Common  Stock or any other  securities  of the Company that
may at any time be issuable on the exercise  hereof for any  purpose,  nor shall
anything  contained herein be construed to confer upon the Holder,  as such, any
of the  rights  of a  stockholder  of the  Company  or any right to vote for the
election  of  directors  or upon any matter  submitted  to  stockholders  at any
meeting thereof, or to give or withhold consent to any corporate action (whether
upon any recapitalization,  issuance of stock, reclassification of stock, change
of par  value,  or  change  of stock  to no par  value,  consolidation,  merger,
conveyance,  or  otherwise)  or to  receive  notice of  meetings,  or to receive
dividends or subscription  rights or otherwise until the Warrant shall have been
exercised as provided herein.

Warrant To Purchase Common Stock - Page 3

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         7. Transfer of Warrant.

                  (a) Warrant  Register.  The Company  will  maintain a register
         (the  "Warrant  Register")  containing  the names and  addresses of the
         Holder or Holders.  Any Holder of this  Warrant or any portion  thereof
         may change  his  address as shown on the  Warrant  Register  by written
         notice to the Company  requesting  such  change.  Any notice or written
         communication  required or  permitted  to be given to the Holder may be
         delivered  or given  by mail to such  Holder  as  shown on the  Warrant
         Register and at the address shown on the Warrant  Register.  Until this
         Warrant is  transferred  on the Warrant  Register of the  Company,  the
         Company  may treat the Holder as shown on the  Warrant  Register as the
         absolute  owner of this Warrant for all purposes,  notwithstanding  any
         notice to the contrary.

                  (b) Warrant  Agent.  The Company may, by written notice to the
         Holder,  appoint an agent for the  purpose of  maintaining  the Warrant
         Register referred to in Section 7(a) above, issuing the Common Stock or
         other  securities  then  issuable  upon the  exercise of this  Warrant,
         exchanging this Warrant,  replacing this Warrant,  or any or all of the
         foregoing.  Thereafter, any such registration,  issuance,  exchange, or
         replacement,  as the case may be,  shall be made at the  office of such
         agent.

                  (c)  Transferability  and  Nonnegotiability  of Warrant.  This
         Warrant may not be  transferred or assigned in whole or in part without
         compliance with all applicable federal and state securities laws by the
         transferor  and the  transferee  (including  the delivery of investment
         representation  letters and legal opinions  reasonably  satisfactory to
         the  Company,  if such are  requested by the  Company).  Subject to the
         provisions  of  this  Warrant  with  respect  to  compliance  with  the
         Securities  Act of 1933, as amended (the "Act"),  title to this Warrant
         may  be  transferred  by  endorsement  (by  the  Holder  executing  the
         Assignment  Form  annexed  hereto) and delivery in the same manner as a
         negotiable instrument transferable by endorsement and delivery.

                  (d) Exchange of Warrant Upon a Transfer.  On surrender of this
         Warrant for  exchange,  properly  endorsed on the  Assignment  Form and
         subject to the  provisions  of this Warrant with respect to  compliance
         with the Act and with the  limitations  on  assignments  and  transfers
         contained in this Section 7, the Company at its expense  shall issue to
         or on the order of the Holder a new  warrant or warrants of like tenor,
         in the name of the Holder or as the Holder (on payment by the Holder of
         any  applicable  transfer  taxes) may direct,  for the number of shares
         issuable upon exercise hereof.

         8.  Reservation  of Stock.  The Company  covenants that during the term
this Warrant is  exercisable,  the Company will reserve from its  authorized and
unissued Common Stock a sufficient  number of shares to provide for the issuance
of Common Stock upon the exercise of this Warrant and,  from time to time,  will
take all steps necessary to amend its Articles of Incorporation (the "Articles")
to provide sufficient  reserves of shares of Common Stock issuable upon exercise
of the  Warrant.  The Company  agrees that its  issuance of this  Warrant  shall
constitute  full  authority  to its  officers  who are charged  with the duty of
executing stock certificates to execute and issue the necessary certificates for
shares of Common Stock upon the exercise of this Warrant.

Warrant To Purchase Common Stock - Page 4

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         9. Notices of Certain Events.

                  (a) In case:

                           (i) the Company shall take a record of the holders of
                  its Common  Stock (or other  stock or  securities  at the time
                  receivable  upon the exercise of this Warrant) for the purpose
                  of   entitling   them  to  receive   any   dividend  or  other
                  distribution,  or any right to  subscribe  for or purchase any
                  shares of stock of any class or any  other  securities,  or to
                  receive any other right, or

                           (ii) of any capital  reorganization  of the  Company,
                  any  reclassification of the capital stock of the Company, any
                  consolidation  or merger of the Company  with or into  another
                  corporation,  or any conveyance of all or substantially all of
                  the assets of the Company to another corporation, or

                           (iii) of any voluntary  dissolution,  liquidation  or
                  winding-up of the Company,  then,  and in each such case,  the
                  Company  will  mail or cause to be  mailed  to the  Holder  or
                  Holders a notice specifying,  as the case may be, (A) the date
                  on  which a  record  is to be taken  for the  purpose  of such
                  dividend,  distribution  or right,  and stating the amount and
                  character of such dividend,  distribution or right, or (B) the
                  date   on   which   such   reorganization,   reclassification,
                  consolidation, merger, conveyance, dissolution, liquidation or
                  winding-up  is to take  place,  and the time,  if any is to be
                  fixed,  as of which the holders of record of Common  Stock (or
                  such  stock  or  securities  at the time  receivable  upon the
                  exercise of this Warrant)  shall be entitled to exchange their
                  shares of Common Stock (or such other stock or securities) for
                  securities   or   other   property   deliverable   upon   such
                  reorganization,   reclassification,   consolidation,   merger,
                  conveyance,  dissolution,   liquidation  or  winding-up.  Such
                  notice  shall be  given  at  least  15 days  prior to the date
                  therein specified.

                  (b) All such  notices,  advices  and  communications  shall be
         deemed to have been received (i) when delivered personally,  (ii) three
         business days after being mailed by first class mail,  postage prepaid,
         or (iii) one  business  day after being sent by a  reputable  overnight
         delivery service, postage or deliver charges prepaid.  Notices, advices
         and  communications  may also be given by prepaid telegram or facsimile
         and shall be effective on the date transmitted if confirmed.

         10. Amendments and Waivers.

                  (a)  Manner  of  Amendment.  Any term of this  Warrant  may be
         amended or waived upon the written consent of the Company, Cybertec and
         the Holder  and  further  provided  that the number of shares of Common
         Stock subject to the Warrant and the Exercise Price may not be amended,
         and the right to exercise  this Warrant may not be waived,  without the
         written  consent of Cybertec  and the Holder of this  Warrant (it being
         agreed that an amendment to or waiver  under any of the  provisions  of
         Section 11 of this Warrant  shall not be considered an amendment of the
         number of shares subject to the Warrant or the Exercise Price).

Warrant To Purchase Common Stock - Page 5

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                  (b) No Continuing Waiver. No waivers of, or exceptions to, any
         term,  condition  or  provision  of  this  Warrant,  in any one or more
         instances,  shall  be  deemed  to  be,  or  construed  as,  further  or
         continuing waiver of any such term, condition or provision.

         11.   Adjustments.   The  Exercise  Price  and  the  number  of  shares
purchasable hereunder are subject to adjustment from time to time as follows:

                  (a)  Merger,  Sale of Assets,  etc.  If at any time while this
         Warrant,  or any portion  thereof,  is outstanding  and unexpired there
         shall   be   (i)  a   reorganization   (other   than   a   combination,
         reclassification,  exchange or subdivision of shares otherwise provided
         for herein), (ii) a merger or consolidation of the Company with or into
         another  corporation in which the Company is not the surviving  entity,
         or a reverse  triangular  merger in which the Company is the  surviving
         entity  but the  shares  of the  Company's  capital  stock  outstanding
         immediately  prior to the merger are  converted by virtue of the merger
         into  other  property  whether  in the  form  of  securities,  cash  or
         otherwise,  or (iii) a sale or transfer of the Company's properties and
         assets as, or substantially  as, an entirety to any other person,  this
         Warrant shall  thereafter  represent the right to acquire the number of
         shares of stock or other  securities  which the Holder of this  Warrant
         would  have  owned   immediately   after  the   consummation   of  such
         reorganization,  merger, consolidation, sale or transfer, if the Holder
         of this  Warrant had  exercised  this  Warrant  immediately  before the
         effective date of the reorganization,  merger,  consolidation,  sale or
         transfer.

                  (b)  Reclassification,  etc. If the Company, at any time while
         this Warrant, or any portion thereof, remains outstanding and unexpired
         by reclassification of securities or otherwise, shall change any of the
         securities  as to which  purchase  rights under this Warrant exist into
         the same or a  different  number of  securities  of any other  class or
         classes,  this Warrant shall thereafter  represent the right to acquire
         such number and kind of  securities  as would have been issuable as the
         result of such change with respect to the securities  that were subject
         to the purchase  rights under this  Warrant  immediately  prior to such
         reclassification  or other change and the Exercise Price therefor shall
         be  appropriately  adjusted,  all  subject  to  further  adjustment  as
         provided in this Section 11.

                  (c)  Split,  Subdivision  or  Combination  of  Shares.  If the
         Company at any time while this Warrant, or any portion thereof, remains
         outstanding  and  unexpired  shall  split,  subdivide  or  combine  the
         securities as to which purchase rights under this Warrant exist, into a
         different  number of securities of the same class,  the Exercise  Price
         for such securities shall be proportionately decreased in the case of a
         split or  subdivision  or  proportionately  increased  in the case of a
         combination.

                  (d) Adjustments for Dividends in Stock or Other Securities. If
         while this Warrant,  or any portion  hereof,  remains  outstanding  and
         unexpired  the holders of the  securities as to which  purchase  rights
         under this  Warrant  exist at the time shall have  received,  or, on or
         after  the  record  date  fixed  for  the   determination  of  eligible
         stockholders,  shall have become  entitled to receive,  without payment
         therefor,  other or additional stock or other securities of the Company
         by way of dividend, then and in each case, this Warrant shall represent
         the  right to  acquire,  in  addition  to the  number  of shares of the
         security receivable upon exercise of this Warrant,  and without payment
         of any additional  consideration  therefor, the amount of such other or
         additional  stock or other  securities  of the Company that such holder
         would  hold on the  date of such  exercise  had it been the  holder  of
         record of the security  receivable upon exercise of this Warrant on the
         date hereof and had thereafter,  during the period from the date hereof
         to and including the date of such exercise, retained such shares and/or
         all other  additional  stock  available to it as aforesaid  during such
         period,  giving effect to all adjustments called for during such period
         by the provisions of this Section 11.

Warrant To Purchase Common Stock - Page 6

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                  (e) Certificate as to Adjustments. Upon the occurrence of each
         adjustment or readjustment  pursuant to this Section 11, the Company at
         its expense shall promptly  compute such  adjustment or readjustment in
         accordance  with the terms  hereof and  furnish to each  Holder of this
         Warrant a certificate  setting forth, in reasonable  detail,  the event
         requiring the adjustment or readjustment, the amount of such adjustment
         or  readjustment,  the method by which such  adjustment or readjustment
         was  calculated,  the  Exercise  Price at the time in  effect,  and the
         number of shares and the amount,  if any, of other property that at the
         time would be received  upon the exercise of the  Warrant.  The Company
         shall  upon the  written  request,  at any  time,  of any such  Holder,
         furnish or cause to be furnished to such Holder a like certificate.

                  (f)  Adjustment in Number of Shares.  Upon each  adjustment of
         the Exercise  Price  pursuant to this  Section 11, this  Warrant  shall
         thereafter  evidence  the right to receive upon payment of the adjusted
         Exercise Price that number of shares of Common Stock (calculated to the
         nearest hundredth) obtained from the following formula:

                           X =      Y x  A
                                         -
                                         B

                             X =    the  adjusted  number  of  shares  of Common
                                    Stock  issuable upon exercise of the Warrant
                                    by payment of the adjusted Exercise Price.

                             Y =    the   number  of  shares  of  Common   Stock
                                    previously issuable upon the exercise of the
                                    Warrant  by payment  of the  Exercise  Price
                                    prior to adjustment.

                             A =    the Exercise Price prior to adjustment.

                             B =    the adjusted Exercise Price.

         12.  Governing  Law.  This Warrant  shall be governed by and  construed
under the laws of the State of Texas  without  giving  effect to conflict of law
principles.  Any legal action,  suit or proceeding arising out of or relating to
this  Agreement  may be  instituted  in any state or federal  court of competent
jurisdiction  in the State of Texas,  and each party waives any objection  which
such party may now or hereafter have to the laying of the venue in the County of
Dallas of any such action,  suit or proceeding,  and irrevocably  submits to the
jurisdiction of any such court.

Warrant To Purchase Common Stock - Page 7

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         13. Definitions.

                  (a) "Affiliate" shall mean with respect to a Person, any other
         Person which directly or indirectly through one or more  intermediaries
         controls,  is  controlled  by,  or is under  common  control  with such
         Person.

                  (b) "Fair  Market  Value" means (i) if the Common Stock is not
         registered  under the Securities  Exchange Act of 1934, as amended (the
         "Exchange Act") the fair value of the Common Stock  determined  jointly
         by the Company and the Holders of the  Warrants;  provided that if such
         parties are unable to reach agreement within twenty (20) Business Days,
         such  fair  value  shall  be  determined  by an  independent  qualified
         appraiser  selected  by the  Holders  (subject  to the  approval of the
         Company,  such approval not to be withheld or delayed  unreasonably  by
         the  Company);  the  determination  of such fair value by the appraiser
         shall be final  and  binding  on the  Company  and the  Holders  of the
         Warrants,  and the fees and expenses of such appraiser shall be divided
         evenly between the Holders on the one hand and the Company on the other
         hand,  and  shall be  without  regard  to any  discounts  for  minority
         ownership or for lack of liquidity or marketability; (ii) if the Common
         Stock is  registered  under the Exchange  Act, the average of the daily
         market  prices for each  business day during the period  commencing  30
         business  days before such date and ending on the date one day prior to
         such date or, if the  security has been  registered  under the Exchange
         Act for less than 30 consecutive  business days before such date,  then
         the average of the daily  market  prices for all of the  business  days
         before such date for which daily market  prices are  available.  If the
         market price is not  determinable for at least 15 business days in such
         period, the Fair Market Value of the security shall be determined as if
         the security was not registered under the Exchange Act.

                  (c) "Person"  includes without  limitation any natural person,
         joint venture,  corporation,  partnership,  limited liability  company,
         trust,   estate,   association,   government  or  governmental   entity
         (including,  but not  limited  to,  any  subdivision,  branch or agency
         thereof) or any other entity.

         IN WITNESS WHEREOF,  the Company has caused this Warrant to be executed
by its officers  thereunto  duly  authorized as of the date first above written,
intending to be legally bound hereby.

                                           AVATAR SYSTEMS, INC.


                                           By: /s/ Robert C. Shreve, Jr.
                                              ----------------------------------
                                              Robert C. Shreve, Jr., President

Warrant To Purchase Common Stock - Page 8

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                               NOTICE OF EXERCISE


To:      AVATAR SYSTEMS, INC.


         The  undersigned  hereby  elects to purchase  shares of Common Stock of
Avatar Systems,  Inc. pursuant to the terms of the attached Warrant, and tenders
herewith payment of the purchase price for such shares in full.

         Please issue a certificate or certificates  representing said shares of
Common  Stock  in the  name  of the  undersigned  or in  such  other  name as is
specified below:


                                         ---------------------------------------
                                         (Name)


                                         ---------------------------------------
                                         (Name)


         Please issue a new Warrant for the unexercised  portion of the attached
Warrant in the name of the  undersigned  or in such  other name as is  specified
below:


                                         ---------------------------------------
                                         (Name)


                                         ---------------------------------------
                                         (Name)


---------------------------------------
(Date)


<PAGE>

                                 ASSIGNMENT FORM


         FOR VALUE RECEIVED,  the undersigned  registered  owner of this Warrant
hereby  sells,  assigns and transfers  unto the Assignee  named below all of the
rights of the undersigned  under the within Warrant,  with respect to the number
of shares of Common Stock set forth below:

           Name of Assignee              Address              No. of Shares
           ----------------              -------              -------------







         and    does    hereby     irrevocably     constitute     and    appoint
Attorney_____________________   _____________________________   to   make   such
transfer on the books of Avatar Systems,  Inc. maintained for the purpose,  with
full power of substitution in the premises.

         The  undersigned  also  represents  that,  by  assignment  hereof,  the
Assignee  acknowledges  that this  Warrant  and the shares of stock to be issued
upon exercise hereof or conversion thereof are being acquired for investment and
that the Assignee will not offer,  sell or otherwise  dispose of this Warrant or
any shares of stock to be issued  upon  exercise  hereof or  conversion  thereof
except  under  circumstances  which  will  not  result  in a  violation  of  the
Securities Act of 1933, as amended, or any state securities laws.  Further,  the
Assignee  has  acknowledged  that upon  exercise of this  Warrant,  the Assignee
shall, if requested by the Company,  confirm in writing,  in a form satisfactory
to the  Company,  that the shares of stock so purchased  are being  acquired for
investment and not with a view toward distribution or resale.


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                                         Signature of Holder


Dated
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