PROMISSORY NOTE

 $000.000                                                 Dated:
----------                                               ----------------------

                                  SECTION ONE

TERMS OF NOTE

FOR VALUE RECEIVED, SGI INTERNATIONAL, OTC Bulletin Board symbol "SGII"
("the "Debtor"), of 1200 Prospect Street, Suite 325, La Jolla, CA 92037 promises
to pay to the order of _________ (hereinafter "_____________") of
______________________, the principal sum of _______________ ($______) Dollars
with interest thereon at the rate of nine percent (9%) per annum, payable upon
30 days written demand but no sooner than on March 14, 2000 in cash or at the
option of Debtor, all principal and interest can by paid by issuing _________
_______ shares of restricted stock of Debtor and an additional 5,000 shares to
cover interest up through the due date of the loan. The original loan that is
the subject of this Promissory Note was made by ______________ by wire transfer
to SGI International on ___________, 2000. Debtor shall be in default hereunder
only after ____________ gives five (5) days advance written notice to Debtor
that it is in default, and Debtor does not cure such default within this
prescribed period.

                                  SECTION TWO

PREPAYMENT OF NOTE

Prepayment of the full principal balance, along with all unpaid
interest, or any portion of the principal balance, along with any portion
thereof of unpaid interest, is permitted at any time without penalty.

                                 SECTION THREE

EFFECT OF WAIVER OF RIGHTS BY ____________

______________ is not under any obligation to exercise any of his
rights under this note, and failure to exercise his rights under this note or to
delay in exercising any of his rights shall not be deemed a waiver of or in any
manner impair any of the rights of _____________.

                                  SECTION FOUR

CUMULATIVE RIGHTS AND REMEDIES

The rights and remedies of _________________ specified in this note are
cumulative and do not exclude any other rights or remedies he may otherwise
have.

                                  SECTION FIVE

ACCELERATION ON INSOLVENCY OF DEBTOR

If Debtor shall be adjudged bankrupt, or file a petition in bankruptcy,
or have a petition in bankruptcy filed against it, this note shall become due
and payable immediately without demand or notice.

                                  SECTION SIX

WAIVER OF PRESENTMENT, PROTEST, AND NOTICE OF DISHONOR

Debtor hereby waives all acts on the part of ____________ required in
fixing the liability of the Debtor, including among other things presentment,
notice of dishonor, protest, notice of protest, notice of nonpayment, and any
other notice.

                                 SECTION SEVEN

CHOICE OF LAWS

This note shall be governed by and construed in accordance with the
laws of California in all respects, including matters of construction, validity
and performance.

                                 SECTION EIGHT

COSTS OF COLLECTION

Debtor shall pay on demand all costs of collection, including legal
expenses and attorney fees, incurred by ____________ in enforcing this note on
default.

                                  SECTION NINE

INTEREST CHARGES

If a law, which applies to this note and which sets the maximum
interest amount, is finally interpreted so that the interest in connection with
this note exceed the permitted limits, then: (1) any such interest shall be
reduced by the amount necessary to reduce the interest to the permitted limit;
and (2) any sums already collected (if any) from the Debtor which exceed the
permitted limits will be refunded to the Debtor. The note holder may choose to
make this refund by reducing the principal Debtor owes under this note or by
making a direct payment to the Debtor. If a refund reduces the principal, the
reduction will be treated as a partial payment.

Dated: ___________________
SGI INTERNATIONAL



By

Authorized Signatory