EXHIBIT 4.1

THE SECURITIES  REPRESENTED BY THIS  CERTIFICATE  HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES  ACT"). THESE SECURITIES
HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH,
THE DISTRIBUTION THEREOF. THESE SECURITIES MAY NOT BE OFFERED, SOLD, PLEDGED, OR
TRANSFERRED  UNLESS (I) A REGISTRATION  STATEMENT UNDER THE SECURITIES ACT IS IN
EFFECT AS TO THESE SECURITIES OR (II) THERE IS AN OPINION OF COUNSEL, REASONABLY
SATISFACTORY TO THE CORPORATION, THAT AN EXEMPTION THERE FROM IS AVAILABLE.



                               TELEGEN CORPORATION

                           Convertible Promissory Note

$_______                                                Redwood City, California
                                                               November __, 1997


         FOR VALUE  RECEIVED,  TELEGEN  CORPORATION,  a  California  corporation
(together with its successors and assigns,  the  "Company"),  promises to pay to
the order of  ________________  (the "Holder"),  the sum of ______________  plus
simple  interest  on the  unpaid  balance  from  the  date of  this  Convertible
Promissory Note (the "Note") until paid, at a rate equal to Six Percent (6%) per
annum and will be paid on January 1, April 1, July 1 and  October 1 of each year
for a period of eighteen  (18) months from the date of the Note.  Payment of all
amounts  due  hereunder  shall  be  made,  (i) by  check or (ii) in stock at the
Company's  option at an applicable  Conversion  Price as specified under Section
1(a) herein.

         This Note is issued  pursuant to the  Convertible  Promissory  Note and
Common Stock Warrant  Subscription  Agreement  dated as of _________,  1997 (the
"Subscription Agreement"), between the Company and the Holder.

         The  following  is a  statement  of the  rights of the  Holder  and the
conditions to which this Note is subject,  to which the Holder, by acceptance of
this Note, hereby agrees:

         1. Conversion.

                  (a) Conversion.  For the purposes of this Section 1(a),  "Look
Back Period" shall mean either (i) Five (5) Nasdaq  trading days,  (ii) ten (10)
Nasdaq  trading days, or (iii) twenty (20) Nasdaq  trading days, as  applicable.
Anytime up to eighteen (18) months from the date of the Note, the Holder has the
right, at the Holder's option,  to convert all or any portion of the outstanding
principal  amount of this Note and,  upon having  obtained  permission  from the
Company,  accrued but unpaid interest thereon into fully paid and  nonassessable
shares of Common Stock of the Company at a conversion  price of the lower of (i)
$2.75 or (ii) seventy-five  percent (75%) of the lowest Nasdaq trading price (x)
over a Look Back Period of five (5) Nasdaq trading days if the Note is converted
during  a  period  between  91 and  150  days  from  the  date  of the  Holder's
Subscription  Agreement  (y) over a Look Back Period of ten (10) Nasdaq  trading
days if the Note is  converted  during a period of between 151 and 210 days from
the date of the Holder's  Subscription  Agreement or (z) over a Look Back Period
of 20 Nasdaq trading days if the Note is converted  anytime on or after 211 days
from the date of the Holder's  Subscription  Agreement (the "Conversion Price").
The  number of shares of Common  Stock the Note may be  converted  into shall be
determined by the applicable Conversion

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Price.  On the date  eighteen  months from the date of the Note,  the Note shall
automatically  convert  into the  number of shares of Common  Stock to which the
Holder would have been entitled had the Note been converted on or after 211 days
from the date of the Note as provided in this Section 1(a).

         No fractional shares or scrip representing  fractions of shares will be
issued on conversion, but the number of shares issuable shall be rounded down to
the nearest  whole share.  The shares of Common  Stock of the Company  issued or
issuable upon conversion of this Note are referred to herein as the "Shares."

                  (b) Issuance of Securities on  Conversion.  Conversion of this
Note,  in whole or in part,  shall  occur only upon  surrender  of this Note for
conversion at the principal office of the Company, accompanied by written notice
of election to convert. The Holder shall execute any documents deemed reasonably
necessary by the Company to effect the issue and sale of the capital stock to be
received  by the Holder upon  conversion  of this Note.  As soon as  practicable
after  conversion  of this Note,  the  Company at its  expense  will cause to be
issued,  in the name of and  delivered to the Holder at the Holder's  registered
address,  a certificate for the number of shares of the Company's  capital stock
to which the Holder  shall be  entitled on such  conversion.  To the extent this
Note is not  converted in whole,  the Company will  deliver,  in addition to the
certificate  referred to above, a new Note of like tenor in the principal amount
remaining after such partial conversion. Such certificate will bear such legends
as may be  required  by  applicable  state and  federal  securities  laws in the
opinion of legal counsel for the Company.

         2. Restrictions on Transfer.

                  (a) Legends.  Each certificate  representing the Shares may be
endorsed with the following legends, and the Holder may not make any transfer of
any of the Shares  without first  complying  with the  restrictions  on transfer
described in all such legends:

                           (i) The legend set forth on the face of this Note.

                           (ii) Any other legends  required by applicable  state
securities laws.

The Company  need not register a transfer of any Shares,  and may also  instruct
its  transfer  agent not to register  the  transfer of such  Shares,  unless the
conditions specified in this Section 2 are satisfied.

                  (b) Removal of Legend and Transfer Restrictions.

                           (i) Any legend endorsed on a certificate  pursuant to
Section 2(b)(ii) and any stop transfer  instructions  with respect to the Shares
evidenced  by such  certificate  shall be removed and the Company  shall issue a
certificate  without  such  legend to the  holder  thereof  if such  Shares  are
registered  upon issuance  under the  Securities  Act, and if such legend may be
properly  removed under the terms of Rule 144  promulgated  under the Securities
Act, or if such holder  provides the Company with an opinion of counsel for such
holder reasonably  satisfactory to legal counsel for the Company,  to the effect
that a  sale,  transfer  or  assignment  of  such  shares  may be  made  without
registration.


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                           (ii) Any legend endorsed on a certificate pursuant to
Section 2(b)(iii) and the stop transfer  instructions with respect to the Shares
evidenced by such certificate shall be removed upon receipt by the Company of an
order of the appropriate state securities authority authorizing such removal.

         3.  Prepayment.  The Company  may not prepay this Note,  in whole or in
part, without the written consent of the Noteholder.

         4. Events of Default; Acceleration.

                  (a) So long as this  Note  is  unpaid,  each of the  following
events will constitute an "Event of Default":

                           (i)  default  in  the  payment  of the  principal  or
interest  of this Note as and when the same  shall  become  due and  payable  at
maturity,  by  declaration or otherwise,  and  continuance of such default for a
period of 30 days; or

                           (ii) an involuntary case or other proceeding shall be
commenced  against  the Company  seeking  liquidation,  reorganization  or other
relief  with  respect  to it or  its  debts  under  any  applicable  bankruptcy,
insolvency  or other  similar  law now or  hereafter  in effect,  or seeking the
appointment   of  a  receiver,   liquidator,   assignee,   custodian,   trustee,
sequestrator (or similar official) of the Company or for any substantial part of
the property of the Company or the winding up or  liquidation  of the affairs of
the Company,  and such case or proceeding  shall remain unstayed and undismissed
for a period of 60 days,  or an order for relief  shall be entered  against  the
Company under the federal bankruptcy laws as now or hereafter in effect; or

                           (iii) the Company  shall  commence a  voluntary  case
under  any  applicable  bankruptcy,  insolvency  or  other  similar  law  now or
hereafter  in  effect,  or  consent  to the entry of an order  for  relief in an
involuntary  case under any such law,  or consent to the  appointment  or taking
possession by a receiver, liquidator, assignee, custodian, trustee, sequestrator
(or similar official) of the Company or for any substantial part of the property
of the Company, or the Company shall make any general assignment for the benefit
of  creditors,  or shall fail  generally  to pay its debts as they come due,  or
shall take any corporate action to authorize any of the foregoing; or

                           (iv) failure on the part of the Company to observe or
perform  any of the  covenants  contained  in this Note (other than a failure to
make a payment  specified in clause (i) above) or in the Subscription  Agreement
and the continuance of such failure for a period of 60 days following receipt of
notice from the Holder  specifying such covenant and the nature of the Company's
non-performance.

                  (b) If an Event of Default shall occur, then the Holder may by
notice to the  Company  (a  "Default  Notice"),  so long as the Event of Default
exists,  declare  the  unpaid  principal  and  accrued  interest  of  this  Note
immediately due and payable without further  presentment,  demand,  protest,  or
notice, all of which are hereby waived.


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         5. Notices. Any notice,  request, or other  communications  required or
permitted hereunder shall be in writing and shall deemed to have been duly given
if sent by  facsimile,  or mailed  by  registered  or  certified  mail,  postage
prepaid, or by recognized overnight courier or personal delivery,  addressed (a)
if to the Holder,  to it at the last known address appearing on the books of the
Company  maintained  for  such  purpose,  or  (b) if to  the  Company,  to it at
101Saginaw Drive,  Redwood City,  California 94063,  attention:  Chief Executive
Officer, telephone (650) 261- 9400, facsimile (650) 261-9468, with a copy (which
will not constitute notice) to Thomas C. DeFilipps, Esq.,Wilson Sonsini Goodrich
& Rosati,  650 Page Mill Road,  Palo Alto,  California  94304,  telephone  (415)
493-9300,  facsimile  (415)  493-6811.  Any party  hereto may by notice so given
change its address for future notice hereunder.  All such notices will be deemed
to have been given (i) upon confirmation of delivery, if sent by facsimile, (ii)
three days after  deposit in the U.S.  mails (as  determined by reference to the
postmark),  if sent by mail,  or (iii)  upon  delivery,  if sent by  courier  or
personal delivery.

         6.   Transferability.   With  respect  to  any  offer,  sale  or  other
disposition of any of this Note or the Shares (collectively,  the "Securities"),
the Holder will give written  notice to the Company  prior  thereto,  describing
briefly the manner thereof,  and, if requested by the Company, a written opinion
of  the  Holder's  counsel  to  the  effect  that  such  offer,  sale  or  other
distribution  may be effected without  registration or  qualification  under any
federal or state law then in effect. Promptly upon receiving such written notice
and reasonably  satisfactory opinion, if so requested,  the Company, as promptly
as  practicable,  shall  notify the Holder that the Holder may sell or otherwise
dispose of such  Securities.  Subject to compliance  with  applicable  state and
federal law and the terms of the notice delivered to the Company, the Holder may
transfer such Securities  only by  surrendering  them to the Company with a duly
executed  instrument of assignment in form satisfactory to the Company and funds
sufficient  to pay any  transfer  tax,  whereupon  the Company  will cancel such
Securities  and execute and deliver one or more new  Securities in the names and
amounts  specified in such  instrument  and, if the Holder's  entire interest in
such Securities is not being assigned, in the name of the Holder for the balance
of such  interest.  Any Note  issued  upon  transfer of this Note shall bear the
legend on the face of this Note. All certificates  representing Shares delivered
upon transfer of Securities  shall bear the legends  required by Section 2. If a
determination  has been made  pursuant  to this  Section 6 that the  opinion  of
counsel  for the  Holder is not  reasonably  satisfactory  to the  Company,  the
Company shall so notify the Holder  promptly after such  determination  has been
made. Any attempted transfer of Securities not in compliance with this Section 6
shall be null and void.

         7. Assignment. The rights and obligations of the Company and the holder
shall  be  binding   upon  and   benefit   the   successors,   assigns,   heirs,
administrators,  and transferees of the parties.  This provision shall in no way
affect the restrictions on transfer contained in Sections 2 and 6 of this Note.

         8.  Amendment  and  Waiver.  The rights of the Holder may be amended or
waived upon the written consent of the Company and the Holder.

         9. Integration;  No Shareholder Rights. The Subscription  Agreement and
the other  documents  delivered  pursuant  thereto  at the  Closing,  including,
without limitation,  this Note, constitute the full and entire understanding and
agreement  between  the parties  hereto and  thereto  with regard to the subject
matter hereof and thereof, and supersede any prior or contemporaneous

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understandings,  agreements or  representations  between them that relate to the
subject  matter  hereof or  thereof.  Nothing  contained  in this Note  shall be
construed as conferring upon the Holder or any other person the right to vote or
to consent or to  receive  notice as a  shareholder  in respect of  meetings  of
shareholders  for the election of directors of the Company or any other  matters
or any rights  whatsoever as a shareholder  of the Company;  and no dividends or
interest  shall be payable  or  accrued in respect of this Note or the  interest
represented  hereby or the Shares  obtainable  hereunder  until, and only to the
extent that, this Note shall have been converted.

         10.  California  Law. This Note and the  obligations of the Company and
the Holder  hereunder  shall be governed by and construed in accordance with the
laws of the State of California,  as such laws are applied to contracts  between
California   residents  entered  into  and  to  be  performed   entirely  within
California.

         IN WITNESS WHEREOF,  the Company has caused this Note to be executed by
its duly authorized representative on the date first above written.

                                          TELEGEN CORPORATION


                                          By:___________________________________


                                          Title:________________________________




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