Document:

Exhibit 10.19
                          REGISTRATION RIGHTS AGREEMENT

         REGISTRATION   RIGHTS  AGREEMENT  (this   "Agreement"),   dated  as  of
___________,  2002, by and among ALPHA  VIRTUAL,  INC., a Delaware  Corporation,
with  headquarters  located at 10345 Olympic  Boulevard  Suite 102, Los Angeles,
California  90064  (the  "Company"),  and  Manhattan  Capital  Partners  LLC,  a
California Limited Liability Company, (the "Consultant").

         WHEREAS:

         A. In connection with a Consulting Agreement by and between the parties
hereto of even date  herewith  (the  "Consulting  Agreement"),  the  Company has
agreed,  upon  the  terms  and  subject  to the  conditions  of  the  Consulting
Agreement,  to issue and sell to the  Consultants  warrants  (the  "Warrant") to
purchase  2,000,000  shares of the Company's  common stock, par value $0.001 per
share (the "Common Stock) ("Warrant Shares").

         B. To induce the  Consultants  to execute and  deliver  the  Consulting
Agreement,  the Company has agreed to provide certain  registration rights under
the  Securities  Act  of  1933,  as  amended,  and  the  rules  and  regulations
thereunder, or any similar successor statute (collectively, the "1933 Act"), and
applicable state securities laws.

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

         1.       DEFINITIONS
                  -----------
                  As used in this Agreement,  the following terms shall have the
following meanings:

                  a.  "Investor"  means the  Consultant  and any  transferee  or
assignee thereof to whom the Consultant  assigns its rights under this Agreement
and who agrees to become bound by the provisions of this Agreement in accordance
with Section 8.

                  b. "Person" means a corporation,  a limited liability company,
an association,  a partnership,  an organization,  a business, an individual,  a
governmental or political subdivision thereof or a governmental agency.

                  c. "Register,"  "registered,"  and  "registration"  refer to a
registration   effected  by  preparing  and  filing  one  or  more  Registration
Statements  (as defined  below) in compliance  with the 1933 Act and pursuant to
Rule 415  under  the 1933  Act or any  successor  rule  providing  for  offering
securities on a continuous or delayed basis ("Rule 415"), and the declaration or
ordering of effectiveness of such Registration Statement(s) by the United States
Securities and Exchange Commission (the "SEC").

                                    10.19-1

<PAGE>
                  d.  "Registerable  Securities" means the Warrant Shares issued
or issuable  upon the  exercise  of the Warrant and any shares of capital  stock
issued or issuable with respect to the Warrant Shares or the Warrant as a result
of any stock split, stock dividend, recapitalization,  exchange or similar event
or otherwise.  Notwithstanding the foregoing,  Registerable Securities shall not
include  any  securities  sold by a person to the public  either  pursuant  to a
registration statement or Rule 144 of the 1933 Act.

                  e.  "Registration Statement" means  one or  more  registration
statements of the Company under the 1933 Act registering all of  the Registrable
Securities.

         2.       REGISTRATION
                  ------------
                  a. Mandatory Registration.  The Company shall prepare, and, as
soon as practicable  but in no event later than 45 days from the date of Closing
(the  "Filing  Deadline"),  file  with  the  SEC  a  Registration  Statement  or
Registration  Statements  (as necessary) on Form SB-2 covering the resale of all
of the  Registerable  Securities.  The  Registration  Statement,  to the  extent
allowable under the 1933 Act, shall state that such Registration  Statement also
covers such  indeterminate  number of  additional  shares of Common Stock as may
become issuable upon exercise of the Warrant to prevent dilution  resulting from
stock splits,  stock dividends or similar  transactions.  In the event that Form
SB-2 is unavailable  for such a  registration,  the Company shall use such other
form as is available  for such a  registration.  The Company  shall use its best
efforts to cause such Initial Registration Statement to be declared effective by
the SEC as soon as practicable.

                  b. Legal Counsel.  Subject to Section 5 hereof, the Consultant
shall have the right to select  one legal  counsel  to review  and  oversee  any
offering  pursuant  to this  Section 2 ("Legal  Counsel")  at the expense of the
Company, which expense shall not exceed $5,000.00.  The Company shall reasonably
cooperate with Legal Counsel in performing the Company's  obligations under this
Agreement.

         3.       RELATED OBLIGATIONS
                  -------------------
                  At  such  time  as  the  Company  is   obligated   to  file  a
Registration  Statement  with the SEC pursuant to Section 2(a), the Company will
use its best efforts to effect the registration of the  Registerable  Securities
in accordance  with the intended  method of  disposition  thereof;  and pursuant
thereto, the Company shall have the following obligations:

                  a. The Company shall promptly  prepare and file with the SEC a
Registration  Statement with respect to the applicable  Registerable  Securities
(as  soon as  practicable  but in no event  later  than  the  applicable  Filing
Deadline) and use its best efforts to cause such Registration Statement relating
to the Registerable  Securities to become effective as soon as practicable after
such  filing.  The  Company  shall keep such  Registration  Statement  effective
pursuant  to Rule 415 at all times until the earlier of (i) the date as of which
the Investors may (in the  reasonable  opinion of Legal Counsel) sell all of the
Registerable   Securities   covered  by  such  Registration   Statement  without
restriction pursuant to Rule 144(k) promulgated under the 1933 Act (or successor
thereto)  or (ii)  the date on  which  the  Investors  shall  have  sold all the
Registerable   Securities   covered   by  such   Registration   Statement   (the
"Registration  Period"),  which Registration Statement (including any amendments

                                    10.19-2
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or supplements  thereto and prospectuses  contained therein) (i) shall comply in
all material  respects with the  requirements  of the 1933 Act and the rules and
regulations  of the SEC  promulgated  thereunder  and (ii) shall 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 in which they were made, not misleading.  The financial statements
of the  Company  included  in the  Registration  Statement  or  incorporated  by
reference  therein  will  comply  as to  form  in  all  material  respects  with
applicable  accounting  requirements  and the published rules and regulations of
the SEC applicable  with respect  thereto.  Such financial  statements  shall be
prepared in  accordance  with U.S.  generally  accepted  accounting  principles,
consistently  applied,  during  the  periods  involved  (except  (i)  as  may be
otherwise  indicated in such financial  statements or the notes thereto, or (ii)
in the case of unaudited interim statements,  to the extent they may not include
footnotes or may be condensed or summary statements) and shall fairly present in
all material respects the consolidated financial position of the Company and its
consolidated  subsidiaries as of the dates thereof and the consolidated  results
of their  operations and cash flows for the periods then ended (subject,  in the
case of unaudited  statements,  to immaterial  year-end  adjustments).  The term
"best efforts" shall mean, among other things,  that the Company shall submit to
the SEC,  within two business days after the Company  learns that no review of a
particular  Registration  Statement will be made by the staff of the SEC or that
the staff has no further comments on the Registration Statement, as the case may
be, a request for acceleration of effectiveness of such  Registration  Statement
to a time and date not later than 48 hours after the submission of such request.

                  b.  The  Company  shall  prepare  and  file  with the SEC such
amendments   (including   post-effective   amendments)   and  supplements  to  a
Registration   Statement  and  the  prospectus  used  in  connection  with  such
Registration  Statement,  which  prospectus is to be filed  pursuant to Rule 424
promulgated  under the 1933 Act, as may be necessary  to keep such  Registration
Statement  effective at all times during the  Registration  Period,  and, during
such  period,  comply with the  provisions  of the 1933 Act with  respect to the
disposition  of all  Registerable  Securities  of the  Company  covered  by such
Registration  Statement until such time as all of such  Registerable  Securities
shall  have  been  disposed  of in  accordance  with  the  intended  methods  of
disposition by the seller or sellers  thereof as set forth in such  Registration
Statement. In the case of amendments and supplements to a Registration Statement
which are required to be filed pursuant to this Agreement (including pursuant to
this Section 3(b)) by reason of the Company filing a report on Form 10-KSB, Form
10-QSB or Form 8-K or any analogous report under the Securities  Exchange Act of
1934,  as amended (the "1934 Act"),  the Company  shall have  incorporated  such
report by reference into the  Registration  Statement,  if applicable,  or shall
file such  amendments or  supplements  with the SEC on the same day on which the
1934 Act report is filed which created the  requirement for the Company to amend
or supplement the Registration Statement.

                  c. The Company  shall (a) permit  Legal  Counsel to review and
comment upon (i) the Registration Statement at least seven (7) days prior to its
filing  with  the  SEC  and  (ii)  all  other  Registration  Statements  and all
amendments  and  supplements  to all such  Registration  Statements  (except for
Annual  Reports on Form  10-KSB,  Quarterly  Reports on Form  10-QSB and Current
Reports on Form 8-K and any similar or  successor  reports)  within a reasonable
number  of days  prior  to the  their  filing  with the SEC and (b) not file any
document in a form to which Legal Counsel reasonably objects.  The Company shall
not submit a request for  acceleration  of the  effectiveness  of a Registration

                                    10.19-3
<PAGE>
Statement or any amendment or supplement  thereto  without the prior approval of
Legal Counsel,  which consent shall not be  unreasonably  withheld.  The Company
shall furnish to Legal Counsel,  without charge, (i) any correspondence from the
SEC or  the  staff  of  the  SEC to  the  Company  or  its  representatives  and
correspondence  to the  SEC  from  the  Company  relating  to  any  Registration
Statement,  (ii) promptly after the same is prepared and filed with the SEC, one
copy of any  Registration  Statement  and any  amendment(s)  thereto,  including
financial  statements  and  schedules,  all  documents  incorporated  therein by
reference and all exhibits and (iii) upon the  effectiveness of any Registration
Statement,  one copy of the prospectus  included in such Registration  Statement
and all  amendments  and  supplements  thereto.  The  Company  shall  reasonably
cooperate with Legal Counsel in performing the Company's obligations pursuant to
this Section 3.

                  d.  The  Company  shall   furnish  to  each   Investor   whose
Registerable  Securities  are included in any  Registration  Statement,  without
charge, (i) promptly after the same is prepared and filed with the SEC, at least
one copy of such Registration Statement and any amendment(s) thereto,  including
financial  statements  and  schedules,  all  documents  incorporated  therein by
reference,  all  exhibits  and  each  preliminary  prospectus,   (ii)  upon  the
effectiveness  of any  such  Registration  Statement,  five  (5)  copies  of the
prospectus  included  in such  Registration  Statement  and all  amendments  and
supplements  thereto  (or such  other  number  of copies  as such  Investor  may
reasonably  request)  and (iii) such other  documents,  including  copies of any
preliminary or final  prospectus,  as such Investor may reasonably  request from
time to  time  in  order  to  facilitate  the  disposition  of the  Registerable
Securities  owned by such Investor.  In responding to comments from the staff of
the SEC, the Company shall cooperate with any Investor that notifies the Company
that it desires to be consulted with respect to such process.  Such  cooperation
shall  solely  consist  of  providing  any  such  Investor  with:  a  reasonable
opportunity to comment on the text and substance of proposed  written  responses
to the extent such comment  relates to such investor or its plan of distribution
of the Registrable Securities.  To the extent that issues raised by the staff of
the SEC have an impact  primarily on any such Investor  rather than the Company,
the Company shall give  reasonable  deference to such  Investor's  requests with
respect to the process and substance of responses with respect to such issues.

                  e. The Company  shall use its best efforts to (i) register and
qualify the Registerable  Securities  covered by a Registration  Statement under
such other  securities  or "blue sky" laws of such  jurisdictions  in the United
States as any  Investor  reasonably  requests,  (ii)  prepare  and file in those
jurisdictions,   such  amendments  (including  post-effective   amendments)  and
supplements  to such  registrations  and  qualifications  as may be necessary to
maintain the effectiveness  thereof during the Registration  Period,  (iii) take
such other  actions as may be  necessary  to  maintain  such  registrations  and
qualifications in effect at all times during the Registration  Period,  and (iv)
take all  other  actions  reasonably  necessary  or  advisable  to  qualify  the
Registerable Securities for sale in such jurisdictions;  provided, however, that
the  Company  shall not be required in  connection  therewith  or as a condition
thereto to (w) make any change to its certificate of  incorporation  or by-laws,
which in each  case the  Board of  Directors  of the  Company  determines  to be
contrary to the best interests of the Company and its stockholders,  (x) qualify
to do business in any  jurisdiction  where it would not otherwise be required to
qualify but for this Section 3(e), (y) subject itself to general taxation in any

                                    10.19-4
<PAGE>
such  jurisdiction,  or (z) file a general  consent to service of process in any
such  jurisdiction.  The Company  shall  promptly  notify Legal Counsel and each
Investor who holds Registerable  Securities of the receipt by the Company of any
notification with respect to the suspension of the registration or qualification
of any of the  Registerable  Securities  for sale under the  securities or "blue
sky" laws of any  jurisdiction  in the  United  States or its  receipt of actual
notice of the initiation or threat of any proceeding for such purpose.

                  f. As promptly as  practicable  after  becoming  aware of such
event,  the Company  shall notify each Investor by telephone or facsimile of the
happening of any event, of which the Company has knowledge, as a result of which
the  prospectus  included  in the  Registration  Statement,  as then in  effect,
includes an untrue  statement of a material fact or omission to state a material
fact required to be stated therein or necessary to make the  statements  therein
not  misleading,  and use its best efforts  promptly to prepare a supplement  or
amendment to the  Registration  Statement  to correct  such untrue  statement or
omission  and deliver such number of copies of such  supplement  or amendment to
each Investor as such Investor may reasonably request.

                  g. The  Company  shall use its best  efforts  to  prevent  the
issuance  of  any  stop  order  or  other   suspension  of  effectiveness  of  a
Registration  Statement,  and,  if  such an  order  is  issued,  to  obtain  the
withdrawal  of such order at the earliest  practicable  date  (including in each
case by amending or  supplementing  such  Registration  Statement) and to notify
each Investor who holds  Registrable  Securities being sold (or, in the event of
an underwritten  offering,  the managing  underwriters)  of the issuance of such
order  and  the  resolution  thereof  (and  if such  Registration  Statement  is
supplemented  or amended,  deliver such number of copies of such  supplement  or
amendment to each Investor as such Investor may reasonably request).

                  h. The Company shall make  available for inspection by (i) any
Investor whose Registrable Securities are included in a Registration  Statement,
and (ii) one firm of  attorneys  and one  firm of  accountants  or other  agents
retained  by the  Investors,  (collectively,  the  "Inspectors")  all  pertinent
financial and other records, and pertinent corporate documents and properties of
the  Company  (collectively,  the  "Records"),  as  shall be  reasonably  deemed
necessary  by each  Inspector  to enable  each  Inspector  to  exercise  its due
diligence  responsibility,  and  cause the  Company's  officers,  directors  and
employees to supply all information  which any Inspector may reasonably  request
for purposes of such due diligence.

                  i.  The  Company  shall  hold in  confidence  and not make any
disclosure of information  concerning an Investor provided to the Company unless
(i) disclosure of such  information is necessary to comply with federal or state
securities  laws, (ii) the disclosure of such  information is necessary to avoid
or correct a misstatement or omission in any Registration  Statement,  (iii) the
release of such  information  is ordered  pursuant to a subpoena or other final,
non-appealable   order  from  a  court  or   governmental   body  of   competent
jurisdiction,  or (iv) such information has been made generally available to the
public other than by  disclosure  in  violation  of this  Agreement or any other
agreement.  The Company agrees that it shall,  upon learning that  disclosure of
such  information  concerning  an  Investor  is  sought  in  or  by a  court  or
governmental body of competent  jurisdiction or through other means, give prompt

                                    10.19-5
<PAGE>
written  notice to such  Investor  and allow such  Investor,  at the  Investor's
expense, to undertake  appropriate action to prevent disclosure of, or to obtain
a protective order for, such information.

                  j. At the  request of an Initial  Investor  or  Investors  who
holds a majority-in-interest  of the Registrable  Securities,  the Company shall
prepare  and  file  with  the  SEC  such  amendments  (including  post-effective
amendments) and supplements to a Registration  Statement and the prospectus used
in connection with the  Registration  Statement each as approved by the Company,
which  approval  shall  not  be  unreasonably  withheld  or  delayed,  as may be
necessary  in  order  to  change  the  plan of  distribution  set  forth in such
Registration Statement.

                  k. The Company  shall  cooperate  with the  Investors who hold
Registerable  Securities  being  offered  and,  to  the  extent  applicable,  to
facilitate the timely  preparation and delivery of certificates (not bearing any
restrictive  legend)  representing  the  Registerable  Securities  to be offered
pursuant to a Registration  Statement and enable such certificates to be in such
denominations  or amounts,  as the case may be, as the Investors may  reasonably
request and registered in such names as the Investors may request.

                  l. The  Company  shall  use its  best  efforts  to  cause  the
Registerable  Securities covered by the applicable  Registration Statement to be
registered with or approved by such other  governmental  agencies or authorities
as  may  be  necessary  to  consummate  the  disposition  of  such  Registerable
Securities.

                  m. The  Company shall otherwise use its best efforts to comply
with all applicable  rules and regulations of the SEC  in  connection  with  any
registration hereunder.

                  n.  The  Company  shall  take  all  other  reasonable  actions
necessary  to  expedite  and   facilitate   disposition   by  the  Investors  of
Registerable Securities pursuant to a Registration Statement.

         4.       OBLIGATIONS OF THE INVESTORS
                  ----------------------------
                  a. At least  ten (10)  days  prior  to the  first  anticipated
filing  date of the  Registration  Statement,  the  Company  shall  notify  each
Investor in writing of the information the Company reasonably requires from each
such  Investor  if  such  Investor   elects  to  have  any  of  such  Investor's
Registerable  Securities included in such Registration  Statement. It shall be a
condition   precedent  to  the  obligations  of  the  Company  to  complete  the
registration  pursuant  to  this  Agreement  with  respect  to the  Registerable
Securities  of a particular  Investor  that such  Investor  shall furnish to the
Company such information  regarding itself, the Registerable  Securities held by
it and the intended method of disposition of the Registerable Securities held by
it  as  shall  be  reasonably  required  to  effect  the  registration  of  such
Registerable Securities and shall execute such documents in connection with such
registration as the Company may reasonably request.

                  b.  Each  Investor  by  such  Investor's   acceptance  of  the
Registerable  Securities  agrees to  cooperate  with the  Company as  reasonably
requested by the Company in connection  with the  preparation  and filing of any

                                    10.19-6
<PAGE>
Registration Statement hereunder,  unless such Investor has notified the Company
in  writing  of such  Investor's  election  to  exclude  all of such  Investor's
Registerable Securities from such Registration Statement.

         5.       EXPENSES OF REGISTRATION
                  ------------------------
                  All reasonable expenses (other than underwriting discounts and
commissions)   incurred   in   connection   with   registrations,   filings   or
qualifications pursuant to Sections 2 and 3, including,  without limitation, all
registration,  listing and qualifications fees,  printers,  legal and accounting
fees shall be paid by the Company. In addition,  the Company shall reimburse the
Investors  for the  reasonable  fees  and  disbursements  of  Legal  Counsel  in
connection with registrations,  filings or qualifications  pursuant to Section 2
and 3 of this Agreement.

         6.       INDEMNIFICATION
                  ---------------
                  In the event any  Registerable  Securities  are  included in a
Registration Statement under this Agreement:

                  a. To the fullest  extent  permitted by law, the Company will,
and hereby  does,  indemnify,  hold  harmless  and  defend  each  Investor,  the
directors,  officers, partners, employees, agents,  representatives of, and each
Person,  if any, who controls any Investor within the meaning of the 1933 Act or
the  Securities  Exchange Act of 1934,  as amended  (the "1934 Act")  (each,  an
"Indemnified  Person"),  against  any  losses,  claims,  damages,   liabilities,
judgments, fines, penalties, charges, costs, reasonable attorneys' fees, amounts
paid in  settlement  or  expenses,  joint or several,  (collectively,  "Claims")
incurred in  investigating,  preparing or  defending  any action,  claim,  suit,
inquiry,  proceeding,  investigation  or appeal  taken from the  foregoing by or
before any court or governmental,  administrative  or other  regulatory  agency,
body or the SEC,  whether  pending or threatened,  whether or not an indemnified
party is or may be a party thereto ("Indemnified Damages"), to which any of them
may become subject  insofar as such Claims (or actions or  proceedings,  whether
commenced or threatened, in respect thereof) arise out of or are based upon: (i)
any  untrue  statement  or alleged  untrue  statement  of a  material  fact in a
Registration Statement or any post-effective  amendment thereto or in any filing
made in connection with the  qualification  of the offering under the securities
or other "blue sky" laws of any  jurisdiction in which  Registerable  Securities
are offered ("Blue Sky Filing"),  or the omission or alleged omission to state a
material fact required to be stated  therein or necessary to make the statements
therein not misleading, (ii) any untrue statement or alleged untrue statement of
a material  fact  contained in any  preliminary  prospectus if used prior to the
effective  date  of such  Registration  Statement,  or  contained  in the  final
prospectus  (as  amended or  supplemented,  if the Company  files any  amendment
thereof or supplement  thereto with the SEC) or the omission or alleged omission
to state  therein  any  material  fact  necessary  to make the  statements  made
therein,  in light of the circumstances  under which the statements therein were
made, not misleading or (iii) any violation or alleged  violation by the Company
of the 1933 Act, the 1934 Act, any other law, including, without limitation, any
state securities law, or any rule or regulation thereunder relating to the offer
or sale of the Registerable Securities pursuant to a Registration Statement (the
matters  in  the  foregoing  clauses  (i)  through  (iii)  being,  collectively,
"Violations").   The  Company  shall  reimburse  the  Investors  and  each  such
underwriter  or controlling  person,  promptly as such expenses are incurred and

                                    10.19-7
<PAGE>
are due and payable,  for any legal fees or  disbursements  or other  reasonable
expenses incurred by them in connection with investigating or defending any such
Claim.   Notwithstanding   anything  to  the  contrary   contained  herein,  the
indemnification agreement contained in this Section 6(a): (i) shall not apply to
a Claim by an Indemnified  Person arising out of or based upon a Violation which
occurs in reliance upon and in conformity with information  furnished in writing
to the Company by such  Indemnified  Person expressly for use in connection with
the preparation of the Registration  Statement or any such amendment  thereof or
supplement  thereto;  (ii) shall not be  available  to the extent  such Claim is
based on a failure of the  Investor to deliver or to cause to be  delivered  the
prospectus  made  available by the Company,  if such  prospectus was timely made
available by the Company  pursuant to Section 3(d); and (iii) shall not apply to
amounts paid in settlement of any Claim if such  settlement is effected  without
the  prior  written  consent  of  the  Company,   which  consent  shall  not  be
unreasonably  withheld.  Such  indemnity  shall  remain in full force and effect
regardless of any investigation  made by or on behalf of the Indemnified  Person
and shall survive the transfer of the  Registerable  Securities by the Investors
pursuant to Section 9.

                  b. In connection with any  Registration  Statement in which an
Investor  is  participating,  each such  Investor  agrees to  severally  and not
jointly indemnify,  hold harmless and defend, to the same extent and in the same
manner as is set forth in Section 6(a), the Company, each of its directors, each
of its officers who signs the  Registration  Statement and each Person,  if any,
who  controls  the  Company  within the  meaning of the 1933 Act or the 1934 Act
(each an "Indemnified Party"), against any Claim or Indemnified Damages to which
any of them may become  subject,  under the 1933 Act, the 1934 Act or otherwise,
insofar as such Claim or Indemnified  Damages arise out of or are based upon any
Violation,  in each  case to the  extent,  and  only to the  extent,  that  such
Violation  occurs in reliance  upon and in conformity  with written  information
furnished to the Company by such Investor  expressly for use in connection  with
such  Registration  Statement;  and subject to Section 6(c),  such Investor will
reimburse any legal or other expenses  reasonably incurred by them in connection
with  investigating  or defending any such Claim;  provided,  however,  that the
indemnity  agreement  contained  in this  Section  6(b) and the  agreement  with
respect to  contribution  contained in Section 7 shall not apply to amounts paid
in  settlement  of any Claim if such  settlement  is effected  without the prior
written  consent  of such  Investor,  which  consent  shall not be  unreasonably
withheld;  provided,  further,  however, that the Investor shall be liable under
this Section  6(b) and Section 7 for only that amount of a Claim or  Indemnified
Damages as does not exceed the net proceeds to such  Investor as a result of the
sale of Registerable  Securities pursuant to such Registration  Statement.  Such
indemnity shall remain in full force and effect  regardless of any investigation
made by or on behalf of such Indemnified Party and shall survive the transfer of
the   Registerable   Securities  by  the   Investors   pursuant  to  Section  9.
Notwithstanding  anything to the contrary contained herein, the  indemnification
agreement  contained in this Section 6(b) with respect to any  prospectus  shall
not inure to the benefit of any  Indemnified  Party if the untrue  statement  or
omission of material fact  contained in the prospectus was corrected on a timely
basis and such new  prospectus  was  delivered  to each  Investor  prior to such
Investor's use of the prospectus to which the Claim relates.

                  c.  Promptly  after  receipt  by  an  Indemnified   Person  or
Indemnified  Party  under this  Section 6 of notice of the  commencement  of any
action or proceeding (including any governmental action or proceeding) involving

                                    10.19-8
<PAGE>
a Claim,  such  Indemnified  Person or  Indemnified  Party shall,  if a Claim in
respect thereof is to be made against any indemnifying  party under this Section
6,  deliver  to the  indemnifying  party a written  notice  of the  commencement
thereof, and the indemnifying party shall have the right to participate in, and,
to the  extent  the  indemnifying  party so  desires,  jointly  with  any  other
indemnifying party similarly  noticed,  to assume control of the defense thereof
with counsel mutually satisfactory to the indemnifying party and the Indemnified
Person or the Indemnified Party, as the case may be; provided,  however, that an
Indemnified  Person or Indemnified  Party shall have the right to retain its own
counsel  with the fees  and  expenses  of not  more  than one  counsel  for such
Indemnified  Person or Indemnified  Party to be paid by the indemnifying  party,
if, in the reasonable opinion of counsel retained by the indemnifying party, the
representation  by such counsel of the Indemnified  Person or Indemnified  Party
and the  indemnifying  party would be  inappropriate  due to actual or potential
differing interests between such Indemnified Person or Indemnified Party and any
other party  represented by such counsel in such  proceeding.  In the case of an
Indemnified  Person,  legal  counsel  referred to in the  immediately  preceding
sentence  shall be selected by the  Investors  holding a majority in interest of
the Registerable  Securities included in the Registration Statement to which the
Claim relates. The Indemnified Party or Indemnified Person shall cooperate fully
with the indemnifying party in connection with any negotiation or defense of any
such  action  or  claim by the  indemnifying  party  and  shall  furnish  to the
indemnifying party all information reasonably available to the Indemnified Party
or Indemnified  Person which relates to such action or claim.  The  indemnifying
party shall keep the Indemnified  Party or Indemnified  Person fully apprised at
all times as to the status of the defense or any  settlement  negotiations  with
respect thereto. No indemnifying party shall be liable for any settlement of any
action,  claim  or  proceeding  effected  without  its  prior  written  consent,
provided,  however, that the indemnifying party shall not unreasonably withhold,
delay or condition its consent.  No indemnifying party shall,  without the prior
written consent of the Indemnified Party or Indemnified Person, consent to entry
of any judgment or enter into any settlement or other  compromise which does not
include as an unconditional term thereof the giving by the claimant or plaintiff
to such Indemnified Party or Indemnified  Person of a release from all liability
in respect to such claim or litigation.  Following  indemnification  as provided
for hereunder,  the indemnifying  party shall be subrogated to all rights of the
Indemnified Party or Indemnified Person with respect to all third parties, firms
or corporations  relating to the matter for which indemnification has been made.
The  failure  to  deliver  written  notice to the  indemnifying  party  within a
reasonable  time of the  commencement  of any such action shall not relieve such
indemnifying  party of any liability to the  Indemnified  Person or  Indemnified
Party under this Section 6, except to the extent that the indemnifying  party is
prejudiced in its ability to defend such action. The indemnification required by
this Section 6 shall be made by periodic  payments of the amount  thereof during
the course of the  investigation or defense,  as such expense,  loss,  damage or
liability is incurred and is due and payable.

                  d.  The  indemnity  agreements  contained  herein  shall be in
addition to (i) any cause of action or similar right of the Indemnified Party or
Indemnified  Person  against  the  indemnifying  party or  others,  and (ii) any
liabilities the indemnifying party may be subject to pursuant to the law.

         7.       CONTRIBUTION
                  ------------
                  To the extent any  indemnification by an indemnifying party is
prohibited or limited by law, the indemnifying  party agrees to make the maximum

                                    10.19.9
<PAGE>
contribution  with respect to any amounts for which it would otherwise be liable
under Section 6 to the fullest extent permitted by law; provided,  however, that
(i) no contribution shall be made under  circumstances where the maker would not
have been  liable for  indemnification  under the fault  standards  set forth in
Section 6, (ii) no person  guilty of  fraudulent  misrepresentation  (within the
meaning of Section 11(f) of the 1933 Act) shall be entitled to contribution from
any other person who was not guilty of such  fraudulent  misrepresentation,  and
(iii) contribution (together with any indemnification or other obligations under
this  Agreement)  by any seller of  Registrable  Securities  shall be limited in
amount to the net amount of  proceeds  received  by such seller from the sale of
such Registrable Securities.

         8.       ASSIGNMENT OF REGISTRATION RIGHTS
                  ---------------------------------
                  The  rights  under  this  Agreement  shall  be   automatically
assignable  by the  Investors  to any  transferee  of  all  or  any  portion  of
Registerable  Securities  if:  (i) the  Investor  agrees  in  writing  with  the
transferee  or assignee to assign such rights,  and a copy of such  agreement is
furnished to the Company within a reasonable  time after such  assignment;  (ii)
the Company is,  within a  reasonable  time after such  transfer or  assignment,
furnished with written notice of (a) the name and address of such  transferee or
assignee,  and (b) the securities with respect to which such registration rights
are being transferred or assigned;  (iii) immediately following such transfer or
assignment  the further  disposition  of such  securities  by the  transferee or
assignee is restricted  under the 1933 Act and applicable state securities laws;
and  (iv) at or  before  the  time  the  Company  receives  the  written  notice
contemplated  by clause (ii) of this sentence the transferee or assignee  agrees
in  writing  with the  Company  to be bound by all of the  provisions  contained
herein.

         9.       AMENDMENT OF REGISTRATION RIGHTS
                  --------------------------------
                  Provisions of this Agreement may be amended and the observance
thereof may be waived (either  generally or in a particular  instance and either
retroactively  or  prospectively),  only with the written consent of the Company
and Investors who then hold at least a majority of the Registerable  Securities.
Any  amendment  or waiver  effected in  accordance  with this Section 9 shall be
binding upon each Investor and the Company. No such amendment shall be effective
to  the  extent  that  it  applies  to  less  than  all of  the  holders  of the
Registerable Securities

         10.      MISCELLANEOUS
                  -------------
                  a.  A  Person  is  deemed  to  be  a  holder  of  Registerable
Securities  whenever  such  Person  owns  or is  deemed  to own of  record  such
Registerable  Securities.  If the  Company  receives  conflicting  instructions,
notices  or  elections  from  two or  more  Persons  with  respect  to the  same
Registerable  Securities,  the Company shall act upon the basis of instructions,
notice or  election  received  from the  registered  owner of such  Registerable
Securities.

                  b. Any  notices,  consents,  waivers  or other  communications
required or permitted to be given under the terms of this  Agreement  must be in
writing  and will be deemed  to have  been  delivered:  (i) upon  receipt,  when
delivered  personally;  (ii)  upon  receipt,  when sent by  facsimile  (provided

                                    10.19.10
<PAGE>
confirmation of transmission  is  mechanically or  electronically  generated and
kept on file by the sending party); or (iii) one business day after deposit with
a  nationally  recognized  overnight  delivery  service,  in each case  properly
addressed to the party to receive the same. The addresses and facsimile  numbers
for such communications shall be:

                  If to the Company:

                           Alpha Virtual, Inc.
                           10345 Olympic Boulevard, Suite 102
                           Los Angeles, California  90064
                           Telephone:       (310) 432-6200
                           Facsimile:       (310) 432-6222

                  If to Company's Legal Counsel:

                           Law Offices of William B. Barnett
                           15233 Ventura Boulevard, Suite 410
                           Sherman Oaks, California  91403
                           Telephone:       (818) 789-2688
                           Facsimile:       (818) 789-2680
                           Attention:       William B. Barnett, Esq.

                  If to Consultant:

                           Manhattan Capital Partners, LLC
                           14759 Oxnard Street
                           Van Nuys, California  91411
                           Telephone:       (818) 904-9029
                           Facsimile:       (818) 904-9341
                           Attention:       Tariq Kahn

                  If to Consultant's Legal Counsel:

                           Kirkpatrick & Lockhart
                           10100 Santa Monica Boulevard, 7th Floor
                           Los Angeles, California  90067
                           Telephone:       (310) 552-5000
                           Facsimile:       (310) 552-5001
                           Attention:       Thomas Poleti, Esq.

Each party hereto may, from time to time, change its address or facsimile number
for notices  under this  Section  10(b) by giving prior  written  notice of such
changed address or facsimile number.

                  c.  Failure of any party to exercise any right or remedy under
this  Agreement or otherwise,  or delay by a party in  exercising  such right or
remedy, shall not operate as a waiver thereof.

                  d. The corporate laws of the State of California  shall govern
all issues  concerning the relative  rights of the Company and the Consultant as
its stockholders.  All other questions  concerning the  construction,  validity,
enforcement  and  interpretation  of this  Agreement  shall be  governed  by the
internal laws of the State of California, without giving effect to any choice of
law or conflict of law  provision or rule (whether of the State of California or

                                    10.19-11
<PAGE>
any other  jurisdiction)  that would  cause the  application  of the laws of any
jurisdiction  other than the State of California.  Each party hereby irrevocably
submits  to the  non-exclusive  jurisdiction  of the  state and  federal  courts
sitting  in the  City  of Los  Angeles,  for  the  adjudication  of any  dispute
hereunder or in connection herewith or with any transaction  contemplated hereby
or discussed herein, and hereby irrevocably  waives, and agrees not to assert in
any suit, action or proceeding,  any claim that it is not personally  subject to
the  jurisdiction  of any such court,  that such suit,  action or  proceeding is
brought  in an  inconvenient  forum or that the  venue of such  suit,  action or
proceeding is improper. Each party hereby irrevocably waives personal service of
process  and  consents  to  process  being  served in any such  suit,  action or
proceeding  by  mailing a copy  thereof to such  party at the  address  for such
notices to it under this Agreement and agrees that such service shall constitute
good and sufficient  service of process and notice  thereof.  Nothing  contained
herein  shall be deemed to limit in any way any  right to serve  process  in any
manner  permitted by law. If any provision of this Agreement shall be invalid or
unenforceable in any jurisdiction, such invalidity or unenforceability shall not
affect the validity or enforceability of the remainder of this Agreement in that
jurisdiction  or the  validity  or  enforceability  of  any  provision  of  this
Agreement in any other  jurisdiction.  EACH PARTY HEREBY  IRREVOCABLY WAIVES ANY
RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST,  A JURY TRIAL FOR THE ADJUDICATION
OF ANY  DISPUTE  HEREUNDER  OR IN  CONNECTION  HEREWITH  OR ARISING  OUT OF THIS
AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.

                  e. This Agreement and the Consulting  Agreement constitute the
entire  agreement  among the parties  hereto with respect to the subject  matter
hereof  and  thereof.  There  are  no  restrictions,   promises,  warranties  or
undertakings, other than those set forth or referred to herein and therein. This
Agreement  and the  Consulting  Agreement  supersede  all prior  agreements  and
understandings  among the  parties  hereto with  respect to the  subject  matter
hereof and thereof.

                  f. Subject to the  requirements  of Section 8, this  Agreement
shall inure to the benefit of and be binding upon the permitted  successors  and
assigns of each of the parties hereto.

                  g. The  headings  in  this  Agreement are for  convenience  of
reference  only and shall not limit or otherwise  affect the meaning hereof.

                  h. This  Agreement may be executed in identical  counterparts,
each of which shall be deemed an original but all of which shall  constitute one
and the same  agreement.  This  Agreement,  once  executed  by a  party,  may be
delivered to the other party hereto by facsimile  transmission of a copy of this
Agreement bearing the signature of the party so delivering this Agreement.

                  i. Each party  shall do and  perform,  or cause to be done and
performed,  all such further acts and things,  and shall execute and deliver all
such other  agreements,  certificates,  instruments and documents,  as the other
party may reasonably request in order to carry out the intent and accomplish the
purposes of this Agreement and the consummation of the transactions contemplated
hereby.

                  j. All  consents  and other  determinations  to be made by the
Investors  pursuant to this Agreement shall be made, unless otherwise  specified
in  this  Agreement,  by  Investors  holding  a  majority  of  the  Registerable
Securities.

                                    10.19-12
<PAGE>
                      [Signature page follows on next page]

IN WITNESS WHEREOF,  the parties have caused this Registration  Rights Agreement
to be duly executed as of day and year first above written.

COMPANY:                                       Consultant
-------                                        ----------

ALPHA VIRTUAL, INC.                            Manhattan Capital Partners, LLC

By:                                            By:_____________________________
   ---------------------------
Name:  Saif Mansour                            Name:  Bill Cheung
Title:    President                            Title:    Managing Director

                                    10.19-13
<PAGE>
                [Signature page to Registration Rights Agreement]

                             SCHEDULE OF PURCHASERS

Purchaser's: Name
             Address                                Purchaser's Signature
             Telephone Number
             Facsimile Number

____________________________________        ________________________________
             (Name)                                     (Signature)
Address: ___________________________
         ___________________________
         ___________________________
         (    )
         ---------------------------
         (    )            Facsimile
         ---------------------------
____________________________________        ________________________________
             (Name)                                     (Signature)
Address: ___________________________
         ___________________________
         ___________________________
         (    )
         ---------------------------
         (    )            Facsimile
         ---------------------------
____________________________________        ________________________________
             (Name)                                     (Signature)
Address: ___________________________
         ___________________________
         ___________________________
         (    )
         ---------------------------
         (    )            Facsimile
         ---------------------------
____________________________________        ________________________________
             (Name)                                     (Signature)
Address: ___________________________
         ___________________________
         ___________________________
         (    )
         ---------------------------
         (    )            Facsimile
         ---------------------------
____________________________________        ________________________________
              (Name)                                    (Signature)
Address: ___________________________
         ___________________________
         ___________________________
         (    )
         ---------------------------
         (    )            Facsimile
         ---------------------------

                                    10.19-14
<PAGE>
                       SCHEDULE OF PURCHASERS (Continued)

Purchaser's: Name
             Address                                Purchaser's Signature
             Telephone Number
             Facsimile Number

____________________________________        ________________________________
               (Name)                                   (Signature)
Address: ___________________________
         ___________________________
         ___________________________
         (    )
         ---------------------------
         (    )            Facsimile
         ---------------------------
____________________________________        ________________________________
               (Name)                                   (Signature)
Address: ___________________________
         ___________________________
         ___________________________
         (    )
         ---------------------------
         (    )            Facsimile
         ---------------------------
____________________________________        ________________________________
               (Name)                                   (Signature)
Address: ___________________________
         ___________________________
         ___________________________
         (    )
         ---------------------------
         (    )            Facsimile
         ---------------------------
____________________________________        ________________________________
               (Name)                                   (Signature)
Address: ___________________________
         ___________________________
         ___________________________
         (    )
         ---------------------------
         (    )            Facsimile
         ---------------------------
____________________________________        ________________________________
               (Name)                                   (Signature)
Address: ___________________________
         ___________________________
         ___________________________
         (    )
         ---------------------------
         (    )            Facsimile
         ---------------------------

                                    10.19-15
<PAGE>
                       SCHEDULE OF PURCHASERS (Continued)

Purchaser's: Name
             Address                                Purchaser's Signature
             Telephone Number
             Facsimile Number

____________________________________        ________________________________
               (Name)                                   (Signature)
Address: ___________________________
         ___________________________
         ___________________________
         (    )
         ---------------------------
         (    )            Facsimile
         ---------------------------
____________________________________        ________________________________
               (Name)                                   (Signature)
Address: ___________________________
         ___________________________
         ___________________________
         (    )
         ---------------------------
         (    )            Facsimile
         ---------------------------
____________________________________        ________________________________
               (Name)                                   (Signature)
Address: ___________________________
         ___________________________
         ___________________________
         (    )
         ---------------------------
         (    )            Facsimile
         ---------------------------
____________________________________        ________________________________
               (Name)                                   (Signature)
Address: ___________________________
         ___________________________
         ___________________________
         (    )
         ---------------------------
         (    )            Facsimile
         ---------------------------
____________________________________        ________________________________
               (Name)                                   (Signature)
Address: ___________________________
         ___________________________
         ___________________________
         (    )
         ---------------------------
         (    )            Facsimile
         ---------------------------

                                    10.19-16Exhibit 10.20
                              CONSULTING AGREEMENT

         This Consulting  Agreement (the  "Agreement") is made as of __________,
                                           ---------
2002 by and  between,  Alpha  Virtual,  Inc.,  a  Delaware  company,  having its
business address at 10345 West Olympic Boulevard,  Los Angeles,  California 9064
(the "Company") and Manhattan Capital Partners,  LLC, having its principal place
      -------
of business at _________________ (the "Consultant") .
                                       ----------
         In  consideration  of the mutual promises  contained  herein and on the
terms and conditions  hereinafter set forth, the Company and Consultant agree as
follows:

         1.  Provision of Services.  Consultant  agrees to place at the disposal
             ---------------------
of the  Company  its  judgment  and  experience  and to  provide  to the  extent
reasonably  requested  by the  President  of the  Company  and as  agreed  to by
Consultant in its sole discretion, financial and business development consulting
services to the  Company.  These  services  include  introducing  the Company to
strategic  partners to further  corporate  objectives  and advice with regard to
stockholders relations and public relations matters.

         2.  Compensation.  In  consideration  for services to be rendered under
             ------------
this Agreement,  the Company and Consultant  hereby agree that the Company shall
issue  Consultant  five (5) year  warrants to purchase an aggregate of 2,000,000
shares of the  Common  Stock of the  Company  at a per share  exercise  price of
$____, such warrants to be in the form attached hereto as Exhibit "A".

         3.  Liability  of  Consultant.  Consultant  may rely  upon  information
             -------------------------
furnished  to it by the Company and that except as herein  provided,  Consultant
shall not be  accountable  for any loss  suffered by the Company on the basis of
any advice recommendation or approval of Consultant, its partners,  employees or
agents.

         4.  Status  of  Consultant.   Consultant  shall  be  deemed  to  be  an
             ----------------------
independent  contractor and, except as expressly  provided or authorized in this
Agreement, shall have no authority to act for or represent the Company.

         5.  Other  Activities  of  Consultant.   The  Company  recognizes  that
             ---------------------------------
Consultant  now renders and may continue to render  financial and other services
to other  companies,  which may or may not have policies and conduct  activities
similar to those of the Company.  Consultant shall be free to render such advice
and other services and the Company hereby consents thereto. Consultant shall not
be  required to devote its full time and  attention  to the  performance  of its
duties  under  this  Agreement,  but shall  devote  only so much of its time and
attention as it deems reasonable or necessary for such purposes.

                                    10.20-1
<PAGE>
         6.  Term.  Consultant's retention hereunder shall be for a term of [one
             ----
year] commencing upon the execution of this Agreement.

         7.  Miscellaneous.  This Agreement sets forth the entire  agreement and
             -------------
understanding   between  the  parties  and  supersedes  all  prior  discussions,
agreements and  understandings  of every kind and any nature between them.  This
Agreement shall be construed and interpreted  according to the laws of the State
of California.

                                     10.20-2
<PAGE>
         IN WITNESS WHEREOF, the parties have caused this Agreement to be signed
by their respective officers or representatives duly authorized the day and year
first above written.

                                        ALPHA VIRTUAL, INC.

                                        By:
                                           -----------------------------------
                                           Name:
                                           Title:

                                        MANHATTAN CAPITAL PARTNERS, LLC

                                        By:
                                           -----------------------------------
                                           Name:    Bill Cheung
                                           Title:  Managing Director

                                     10.20-3
<PAGE>
                                   EXHIBIT "A"
                                   -----------
                                 FORM OF WARRANT

                                     Warrant
                                     -------
THE WARRANT  EVIDENCED  OR  CONSTITUTED  HEREBY,  AND ALL SHARES OF COMMON STOCK
ISSUABLE HEREUNDER,  HAVE BEEN AND WILL BE ISSUED WITHOUT REGISTRATION UNDER THE
SECURITIES ACT OF 1933, AS AMENDED ("THE ACT") AND MAY NOT BE SOLD,  OFFERED FOR
SALE,  TRANSFERRED,  PLEDGED OR HYPOTHECATED  WITHOUT REGISTRATION UNDER THE ACT
UNLESS  EITHER (A) THE COMPANY HAS  RECEIVED AN OPINION OF COUNSEL,  IN FORM AND
SUBSTANCE   REASONABLY   SATISFACTORY  TO  THE  COMPANY,   TO  THE  EFFECT  THAT
REGISTRATION IS NOT REQUIRED IN CONNECTION WITH SUCH DISPOSITION OR (B) THE SALE
OF SUCH  SECURITIES IS MADE PURSUANT TO SECURITIES AND EXCHANGE  COMMISSION RULE
144.

                        WARRANT TO PURCHASE COMMON STOCK

                                       OF

                               ALPHA VIRTUAL, INC.

                             (Subject to Adjustment)

NO. __

         This Certifies That, for value received, Manhattan Capital Partners
LLC, a California limited liability company ("Holder"), is entitled, subject to
                                              ------
the terms and conditions of this Warrant, at any time or from time to time after
December __, 2002 (the "Effective Date"), to purchase from Alpha Virtual , Inc.,
                        --------------
a Delaware corporation (the "Company"), up to Two Million (2,000,000) shares of
                             -------
common stock of the Company at a price per share of $______ (the "Purchase
                                                                  --------
Price"). This Warrant shall expire at 5:00 p.m. Pacific time on the fifth
-----
anniversary of the Effective Date of this Warrant (the "Expiration Date"). Both
                                                        ---------------
the number of shares of Common Stock purchasable upon exercise of this Warrant
and the Purchase Price are subject to adjustment and change as provided herein.
This Warrant is issued pursuant to that certain Financial Consulting Agreement
of even date hereof between the Company and the Holder.

1.       CERTAIN DEFINITIONS.  As used in this Warrant the following terms shall
have the following respective meanings:

         "1933 Act" shall mean the Securities Act of 1933, as amended.
          --------

         "Common Stock" shall mean the Common Stock of the Company and any other
          ------------
securities at any time receivable or issuable upon exercise of this Warrant.

                                     10.20-4
<PAGE>
         "Fair Market Value" of a share of Common Stock as of a particular date
          -----------------
shall mean:

                  (a) If traded on a securities exchange or the Nasdaq National
Market, the Fair Market Value shall be deemed to be the average of the closing
prices of the Common Stock of the Company on such exchange or market over the 5
business days ending immediately prior to the applicable date of valuation;

                  (b) If actively traded over-the-counter, the Fair Market Value
shall be deemed to be the average of the closing bid prices over the 30-day
period ending immediately prior to the applicable date of valuation; and

                  (c) If there is no active public market, the Fair Market Value
shall be the value as determined in good faith by the Company's Board of
Directors upon a review of relevant factors,  including due consideration of the
Registered Holders' determination of the value of the Company.

         "Registered Holder" shall mean any person in whose name this Warrant is
          -----------------
registered upon the books and records maintained by the Company.

         "SEC" shall mean the Securities and Exchange Commission.
          ---
2.       EXERCISE OF WARRANT

         2.1.  Payment.  Subject to compliance with the terms and conditions of
               -------
this Warrant and applicable securities laws, this Warrant may be exercised, in
whole or in part at any time or from time to time, on or before the Expiration
Date by the delivery (including, without limitation, delivery by facsimile) of
the form of Notice of Exercise attached hereto as Exhibit 1 (the  "Notice of
                                                                   ---------
Exercise"), duly executed by the Registered Holder, at the principal office of
--------
the Company, and as soon as practicable after such date, surrendering

                  (a) this Warrant at the principal office of the Company, and

                  (b) payment, (i) in cash (by check) or by wire transfer,  (ii)
by cancellation  by the Registered Holder of indebtedness of the Company to the
Registered Holder; or (iii) by a combination of (i) and (ii), of an amount equal
to the product obtained by multiplying the number of shares of Common Stock
being purchased upon such exercise by the then effective Purchase Price (the
"Exercise Amount").
----------------
         2.2.  Net Issue Exercise.  In lieu of the payment methods set forth in
               ------------------
Section 2.1(b) above, the Registered Holder may elect to exchange all or some of
the Warrant for shares of Common Stock equal to the value of the amount of the
Warrant being exchanged on the date of exchange. If the Registered Holder elects
to exchange this Warrant as provided in this Section 2.2, the Registered  Holder
shall tender to the Company the Warrant for the amount being exchanged, along
with written notice of the Registered Holder's election to exchange some or all
of the Warrant, and the Company shall issue to the Registered Holder the number
of shares of the Common Stock computed using the following formula:

                                     10.20-5
<PAGE>
                  X = Y (A-B)
                      -------
                         A

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

           Y = the number of shares of Common Stock purchasable under the amount
           of the Warrant being exchanged (as adjusted to the date of such
           calculation).

           A = the Fair Market Value of one share of the Company's Common Stock.

           B = Purchase Price of one share of the Company's Common Stock (as
           adjusted to the date of such calculation).

                  All references herein to an "exercise" of the Warrant shall
include an exchange pursuant to this Section 2.2.

         2.3.  "Easy Sale" Exercise. In lieu of the payment methods set forth in
                -------------------
Section  2.1(b)  above, when permitted by law and applicable  regulations
(including Nasdaq and NASD rules), the Registered Holder may pay the Purchase
Price through a "same day sale" commitment from the Registered Holder (and if
applicable a broker-dealer that is a member of the National Association of
Securities Dealers (a "NASD Dealer")), whereby the Registered Holder irrevocably
                       -----------
elects to exercise this Warran and to sell a portion of the shares of Common
Stock so purchased to pay the applicable Purchase Price and the Registered
Holder (or, if applicable, the NASD Dealer) commits upon sale (or, in the case
of the NASD Dealer, upon receipt) of such shares of Common Stock to forward the
Purchase Price directly to the Company.

         2.4.  Stock Certificates;  Fractional Shares. As soon as practicable on
               --------------------------------------
or after the date of an exercise of this Warrant, the Company shall issue and
deliver to the person or persons entitled to receive the same a certificate or
certificates for the number of whole shares of Common Stock issuable upon such
exercise, together with cash in lieu of any fraction of a share equal to such
fraction of the current Fair Market Value of one whole share of Common Stock as
of the date of exercise of this Warrant.  No fractional shares or scrip
representing fractional shares shall be issued upon an exercise of this Warrant.

         2.5   Partial Exercise;  Effective  Date  of  Exercise.  In case of any
               ------------------------------------------------
partial exercise of this Warrant, the Company shall cancel this Warrant upon
surrender hereof and shall execute and deliver a new Warrant of like tenor and
date for the balance of the shares of Common Stock purchasable hereunder. 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. The person
entitled to receive the shares of Common Stock issuable upon exercise of this
Warrant shall be treated for all purposes as the holder of record of such shares
as of the close of business on the date the Registered Holder is deemed to have
exercised this Warrant.

                                     10.20-6
<PAGE>
3.       VALID ISSUANCE: TAXES. All shares of Common Stock issued upon the
exercise of this Warrant shall be validly issued, fully paid and non-assessable,
and the Company shall pay all taxes and other governmental charges that may be
imposed in respect of the issue or delivery thereof. The Company shall not be
required to pay any tax or other charge imposed in connection with any transfer
involved in the issuance of any certificate for shares of Common Stock in any
name other than that of the Registered Holder of this Warrant, and in such case
the Company shall not be required to issue or deliver any stock certificate or
security until such tax or other charge has been paid, or it has been
established to the Company's reasonable satisfaction that no tax or other charge
is due.

4.       ADJUSTMENT OF PURCHASE PRICE AND NUMBER OF SHARES. The number of shares
of Common Stock issuable upon exercise of this Warrant (or any shares of stock
or other securities or property receivable or issuable upon exercise of this
Warrant) and the Purchase Price are subject to adjustment upon occurrence of the
following events:

         4.1.  Adjustment for Stock Splits,Stock Subdivisions or Combinations of
               -----------------------------------------------------------------
Shares. The Purchase Price of this Warrant shall be proportionally decreased and
------
the number of shares of Common Stock issuable upon exercise of this Warrant (or
any shares of stock or other securities at the time issuable upon exercise of
this Warrant) shall be proportionally increased to reflect any stock split or
subdivision of the Company's Common Stock. The Purchase Price of this Warrant
shall be proportionally increased and the number of shares of Common Stock
issuable upon exercise of this Warrant (or any shares of stock or other
securities at the time issuable upon exercise of this Warrant) shall be
proportionally decreased to reflect any combination of the Company's Common
Stock.

         4.2.  Adjustment for Dividends or Distributions of Stock or Other
               -----------------------------------------------------------
Securities or Property. In case the Company shall make or issue, or shall fix a
----------------------
record date for the determination of eligible holders entitled to receive, a
dividend or other distribution with respect to the Common Stock (or any shares
of stock or other securities at the time issuable upon exercise of the Warrant)
payable in (a) securities of the Company or (b) assets (excluding cash dividends
paid or payable solely out of retained earnings), then, in each such case, the
Registered Holder of this Warrant on exercise hereof at any time after the
consummation, effective date or record date of such dividend or other
distribution, shall receive, in addition to the shares of Common Stock (or such
other stock or securities) issuable on such exercise prior to such date, and
without the payment of additional consideration therefor, the securities or such
other assets of the Company to which such Registered Holder would have been
entitled upon such date if such Registered Holder had exercised 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 by it as aforesaid during such period giving effect
to all adjustments called for by this Section 4.

                                     10.20-7
<PAGE>
         4.3.  Reclassification. If the Company, 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 Purchase Price therefore shall be
appropriately adjusted, all subject to further adjustment as provided in this
Section 4. No adjustment shall be made pursuant to this Section 4.3 upon any
conversion or redemption of the Common Stock which is the subject of Section
4.5.

         4.4.  Adjustment for Capital Reorganization, Merger or Consolidation.
               --------------------------------------------------------------
In case of any capital reorganization of the capital stock of the Company (other
than a combination, reclassification, exchange or subdivision of shares
otherwise provided for herein), or any merger or consolidation of the Company
with or into another corporation, or the sale of all or substantially all the
assets of the Company then, and in each such case, as a part of such
reorganization, merger, consolidation, sale or transfer, lawful provision shall
be made so that the Registered Holder of this Warrant shall thereafter be
entitled to receive upon exercise of this Warrant, during the period specified
herein and upon payment of the Purchase Price then in effect, the number of
shares of stock or other securities or property of the successor corporation
resulting from such reorganization, merger, consolidation, sale or transfer that
a holder of the shares deliverable upon exercise of this Warrant would have been
entitled to receive in such reorganization, consolidation, merger, sale or
transfer if this Warrant had been exercised immediately before such
reorganization, merger, consolidation, sale or transfer, all subject to further
adjustment as provided in this Section 4. The foregoing provisions of this
Section 4.4 shall similarly apply to successive reorganizations, consolidations,
mergers, sales and transfers and to the stock or securities of any other
corporation that are at the time receivable upon the exercise of this Warrant.
If the per-share consideration payable to the Registered Holder hereof for
shares in connection with any such transaction is in a form other than cash or
marketable securities, then the value of such consideration shall be determined
in good faith by the Company's Board of Directors. In all events, appropriate
adjustment (as determined in good faith by the Company's Board of Directors)
shall be made in the application of the provisions of this Warrant with respect
to the rights and interests of the Registered Holder after the transaction, to
the end that the provisions of this Warrant shall be applicable after that
event, as near as reasonably may be, in relation to any shares or other property
deliverable after that event upon exercise of this Warrant.

         4.5.  Conversion of Common Stock. In case all or any portion of the
               --------------------------
authorized and outstanding shares of Common Stock of the Company are redeemed or
converted or reclassified into other securities or property pursuant to the
Company's Certificate of Incorporation or otherwise, or the Common Stock
otherwise ceases to exist, then, in such case, the Registered Holder of this
Warrant, upon exercise hereof at any time after the date on which the Common
Stock is so redeemed or converted, reclassified or ceases to exist (the

                                     10.20-8
<PAGE>
"Termination Date"), shall receive, in lieu of the number of shares of Common
 ----------------
Stock that would have been issuable upon such exercise immediately prior to the
Termination Date, the securities or property that would have been received if
this Warrant had been exercised in full and the Common Stock received thereupon
had been simultaneously converted immediately prior to the Termination Date, all
subject to further adjustment as provided in this Warrant. Additionally, the
Purchase Price shall be immediately adjusted to equal the quotient obtained by
dividing (x) the aggregate Purchase Price of the maximum number of shares of
Common Stock for which this Warrant was exercisable immediately prior to the
Termination Date by (y) the number of shares of Common Stock of the Company for
which this Warrant is exercisable immediately after the Termination Date, all
subject to further adjustment as provided herein.

5.       CERTIFICATE AS TO ADJUSTMENTS. In each case of any adjustment in the
Purchase Price, or number or type of shares issuable upon exercise of this
Warrant, the Chief Financial Officer or Controller of the Company shall compute
such adjustment in accordance with the terms of this Warrant and prepare a
certificate setting forth such adjustment and showing in detail the facts upon
which such adjustment is based, including a statement of the adjusted Purchase
Price. The Company shall promptly send (by facsimile and by either first class
mail, postage prepaid or overnight delivery) a copy of each such certificate to
the Registered Holder.

6.       LOSS OR MUTILATION. Upon receipt of evidence reasonably satisfactory to
the Company of the ownership of and the loss, theft, destruction or mutilation
of this Warrant, and of indemnity reasonably satisfactory to it, and (in the
case of mutilation) upon surrender and cancellation of this Warrant, the Company
will execute and deliver in lieu thereof a new Warrant of like tenor as the
lost, stolen, destroyed or mutilated Warrant.

7.       RESERVATION OF COMMON STOCK. The Company hereby covenants that at all
times there shall be reserved for issuance and delivery upon exercise of this
Warrant such number of shares of Common Stock or other shares of capital stock
of the Company as are from time to time issuable upon exercise of this Warrant
and, from time to time, will take all steps necessary to amend its Certificate
of Incorporation to provide sufficient reserves of shares of Common Stock or
other shares of capital stock issuable upon exercise of this Warrant (and shares
of its Common Stock for issuance on conversion of such capital stock). All such
shares shall be duly authorized, and when issued upon such exercise, shall be
validly issued, fully paid and non-assessable, free and clear of all liens,
security interests, charges and other encumbrances or restrictions on sale and
free and clear of all preemptive rights, except encumbrances or restrictions
arising under federal or state securities laws. Issuance of this Warrant shall
constitute full authority to the Company's officers who are charged with the
duty of executing stock certificates to execute and issue the necessary
certificates for shares of Common Stock and other capital stock upon the
exercise of this Warrant.

8.       TRANSFER AND EXCHANGE. Subject to compliance with all applicable
securities laws, this Warrant and all rights hereunder may be transferred by the
Registered Holder to any person, in whole or in part, on the books of the
Company maintained for such purpose at the principal office of the Company
referred to above, by the Registered Holder hereof in person, or by duly
authorized attorney, upon surrender of this Warrant properly endorsed and upon

                                     10.20-9
<PAGE>
payment of any necessary transfer tax or other governmental charge imposed upon
such transfer. Upon any partial transfer, the Company will issue and deliver to
the Registered Holder a new Warrant or Warrants with respect to the portion of
this Warrant not so transferred. Each taker and holder of this Warrant, by
taking or holding the same, consents and agrees that when this Warrant shall
have been so endorsed, the person in possession of this Warrant may be treated
by the Company, and all other persons dealing with this Warrant, as the absolute
owner hereof for any purpose and as the person entitled to exercise the rights
represented hereby, any notice to the contrary notwithstanding; provided,
however that until a transfer of this Warrant is duly registered on the books of
the Company, the Company may treat the Registered Holder hereof as the owner for
all purposes.

9.       RESTRICTIONS ON TRANSFER. The Registered Holder, by acceptance hereof,
agrees that, absent an effective registration statement filed with the SEC under
the 1933 Act, covering the disposition or sale of this Warrant or the Common
Stock issued or issuable upon exercise hereof or the Common Stock issuable upon
conversion thereof, as the case may be, and registration or qualification under
applicable state securities laws, such Registered Holder will not sell,
transfer, pledge, or hypothecate any or all such Warrants or Common Stock, as
the case may be, unless either (i) the Company has received an opinion of
counsel, in form and substance reasonably satisfactory to the Company, to the
effect that such registration is not required in connection with such
disposition, or (ii) the sale of such securities is made pursuant to SEC Rule
144.

10.      COMPLIANCE WITH SECURITIES LAWS. By acceptance of this Warrant, the
Registered Holder hereby represents, warrants and covenants that any shares of
stock purchased upon exercise of this Warrant or acquired upon conversion
thereof shall be acquired for investment only and not with a view to, or for
sale in connection with, any distribution thereof; that the Registered Holder
has had such opportunity as such Registered Holder has deemed adequate to obtain
from representatives of the Company such information as is necessary to permit
the Registered Holder to evaluate the merits and risks of its investment in the
Company; that the Registered Holder is able to bear the economic risk of holding
such shares as may be acquired pursuant to the exercise of this Warrant for an
indefinite period; that the Registered Holder understands that the shares of
stock acquired pursuant to the exercise of this Warrant or acquired upon
conversion thereof will not be registered under the 1933 Act (unless otherwise
required pursuant to exercise by the Registered Holder of the registration
rights, if any, previously granted to the Registered Holder) and will be
"restricted securities" within the meaning of Rule 144 under the 1933 Act and
that the exemption from registration under Rule 144 will not be available for at
least one year from the date of exercise of this Warrant, subject to any special
treatment by the SEC for exercise of this Warrant pursuant to Section 2.2, and
even then will not be available unless a public market then exists for the
stock, adequate information concerning the Company is then available to the
public, and other terms and conditions of Rule 144 are complied with; and that
all stock certificates representing shares of stock issued to the Registered
Holder upon exercise of this Warrant or upon conversion of such shares may have
affixed thereto a legend substantially in the following form:

         THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED
         UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR
         UNDER THE SECURITIES LAWS OF ANY STATE. THESE SECURITIES ARE

                                    10.20-10
<PAGE>
         SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY
         NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE
         ACT AND ANY APPLICABLE STATE SECURITIES LAWS, PURSUANT TO
         REGISTRATION OR EXEMPTION THEREFROM. INVESTORS SHOULD BE
         AWARE THAT THEY MAY BE REQUIRED TO BEAR THE FINANCIAL RISKS
         OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME. THE
         ISSUER OF THESE SECURITIES MAY REQUIRE AN OPINION OF COUNSEL
         IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER TO THE
         EFFECT THAT ANY PROPOSED TRANSFER OR RESALE IS IN COMPLIANCE
         WITH THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS.

11.      NO RIGHTS OR LIABILITIES AS STOCKHOLDERS. This Warrant shall not
entitle the Registered Holder to any voting rights or other rights as a
stockholder of the Company. In the absence of affirmative action by such
Registered Holder to purchase Common Stock by exercise of this Warrant, no
provisions of this Warrant, and no enumeration herein of the rights or
privileges of the Registered Holder hereof shall cause such Registered Holder
hereof to be a stockholder of the Company for any purpose.

12.      NOTICES. All notices and other communications required or permitted
hereunder shall be in writing and shall be mailed by registered or certified
mail, postage prepaid, return receipt requested, or by telecopier, or by email
or otherwise delivered by hand or by messenger, addressed or telecopied to the
person to whom such notice or communication is being given at its address set
forth after its signature hereto. In order to be effective, a copy of any notice
or communication sent by telecopier or email must be sent by registered or
certified mail, postage prepaid, return receipt requested, or delivered
personally to the person to whom such notice or communication is being at its
address set forth after its signature hereto. If notice is provided by mail,
notice shall be deemed to be given five (5) business days after proper deposit
with the United States mail or nationally recognized overnight courier, or
immediately upon personally delivery thereof, to person to whom such notice or
communication is being at such address. If notice is provided by telecopier,
notice shall be deemed to be given upon confirmation by the telecopier machine
of the receipt of such notice at the telecopier number provided above. If notice
is provided by email, notice shall be deemed to be given upon confirmation by
the sender's email program of the receipt of such notice at the email address
provided after the signature of the person to whom such notice or communication
is being. The addresses set forth after the signatures hereto may be changed by
written notice complying with the terms of this Section 12.

13       HEADINGS. The headings in this Warrant are for purposes of convenience
in reference only, and shall not be deemed to constitute a part hereof.

14.      LAW GOVERNING. This Warrant shall be construed and enforced in
accordance with, and governed by, the laws of the State of California.

15.      NOTICES OF RECORD DATE.  In case:

         15.1. 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

                                    10.20-11
<PAGE>
         15.2. of any consolidation or merger of the Company with or into
another corporation, any capital reorganization of the Company, any
reclassification of the capital stock of the Company, or any conveyance of all
or substantially all of the assets of the Company to another corporation in
which holders of the Company's stock are to receive stock, securities or
property of another corporation; or

         15.3. of any voluntary dissolution, liquidation or winding-up of the
Company; or

         15.4. of any redemption of any outstanding capital stock of the
Company;

then, and in each such case, the Company will mail or cause to be mailed to the
Registered Holder of this Warrant a notice specifying, as the case may be, (i)
the date on which a record is to be taken for the purpose of such dividend,
distribution or right, or (ii) the date on which such reorganization,
reclassification, consolidation, merger, conveyance, dissolution, liquidation,
winding-up, redemption or conversion 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 as at the time are 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 delivered at least
thirty (30) days prior to the date therein specified.

16.      SEVERABILITY. If any term, provision, covenant or restriction of this
Warrant is held by a court of competent jurisdiction to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants and
restrictions of this Warrant shall remain in full force and effect and shall in
no way be affected, impaired or invalidated.

17.      COUNTERPARTS. For the convenience of the parties, any number of
counterparts of this Warrant may be executed by the parties hereto and each such
executed counterpart shall be, and shall be deemed to be, an original
instrument.

18.      SATURDAYS, SUNDAYS AND HOLIDAYS. If the Expiration Date falls on a
Saturday, Sunday or legal holiday, the Expiration Date shall automatically be
extended until 5:00 p.m. on the next business day.

                                    10.20-12
<PAGE>
         IN WITNESS WHEREOF, the parties hereto have executed this Warrant as of
the Effective Date.

COMPANY:                                  HOLDER
-------                                   ------

ALPHA VIRTUAL, INC.                       Manhattan Capital Partners, LLC

By:                                       By:
   -------------------------------           ---------------------------
Name:  Saif Mansour                       Name:  Bill Cheung
Title:    President                       Title:    Managing Director

Address for Notices:                      Address for Notices:

                            SIGNATURE PAGE TO WARRANT

                                    10.20-13
<PAGE>
                                    EXHIBIT 1

                               NOTICE OF EXERCISE

                    (To be executed upon exercise of Warrant)

                                                                 WARRANT NO. ___
------------------

The  undersigned  hereby  irrevocably  elects to exercise  the right of purchase
represented by the within Warrant  Certificate for, and to purchase  thereunder,
the securities of TMSF Holdings,  Inc., as provided for therein,  and (check the
applicable box):

|_|      Tenders  herewith  payment of the exercise price in full in the form of
         cash or a  certified  or official  bank check in same-day  funds in the
         amount of $____________ for _________ such securities.

|_|      Elects the Net Issue  Exercise  option  pursuant  to Section 2.2 of the
         Warrant,  and accordingly  requests delivery of a net of ______________
         of such securities, according to the following calculation:

                  X = Y (A-B)        (       ) =  (____) [(_____) - (_____)]
                      -------                     ---------------------------
                           A                                  (_____)

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

         Y = the number of shares of Common Stock  purchasable  under the amount
         of the  Warrant  being  exchanged  (as  adjusted  to the  date  of such
         calculation).

         A = the Fair Market Value of one share of the Company's Common Stock.

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

|_|      Elects the Net Issue  Exercise  option  pursuant  to Section 2.2 of the
         Warrant,  and accordingly  requests delivery of a net of ______________
         of such securities, according to the following calculation:

Please issue a certificate or  certificates  for such securities in the name of,
and pay any cash for any  fractional  share to (please  print name,  address and
social security number):

Name:
                  -----------------------------------------------------
Address:
                  -----------------------------------------------------
Signature:
                  -----------------------------------------------------

Note: The above signature should  correspond  exactly with the name on the first
page of this Warrant  Certificate or with the name of the assignee  appearing in
the assignment form below.

                                    10.20-14
<PAGE>
If said  number of  shares  shall not be all the  shares  purchasable  under the
within  Warrant  Certificate,  a new Warrant  Certificate is to be issued in the
name of said  undersigned  for the balance  remaining of the shares  purchasable
thereunder rounded up to the next higher whole number of shares.

                                    10.20-15
<PAGE>
                                    EXHIBIT 2

                                   ASSIGNMENT

(To be executed only upon assignment of Warrant Certificate)    WARRANT NO. ___

For value received, hereby sells, assigns and transfers unto____________________
the within Warrant Certificate, together with all right, title and interest
therein, and does hereby irrevocably constitute and appoint ____________________
attorney, to transfer said Warrant Certificate on the books of the within-named
Company with respect to the number of Warrants set forth below, with full power
of substitution in the premises:

----------------------------- ---------------------------- --------------------
   Name(s) of Assignee(s)                Address               # of Warrants
----------------------------- ---------------------------- --------------------

----------------------------- ---------------------------- --------------------

----------------------------- ---------------------------- --------------------

----------------------------- ---------------------------- --------------------

----------------------------- ---------------------------- --------------------

----------------------------- ---------------------------- --------------------

And if said number of Warrants shall not be all the Warrants represented by the
Warrant Certificate, a new Warrant Certificate is to be issued in the name of
said undersigned for the balance remaining of the Warrants registered by said
Warrant Certificate.

Dated:
                  -----------------------------------------------------

Signature:
                  -----------------------------------------------------

Notice: The signature to the foregoing Assignment must correspond to the name as
written upon the face of this security in every particular, without alteration
or any change whatsoever; signature(s) must be guaranteed by an eligible
guarantor institution (banks, stock brokers, savings and loan associations and
credit unions with membership in an approved signature guarantee medallion
program) pursuant to Securities and Exchange Commission Rule 17Ad-15.

                                    10.20-16

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