EXHIBIT 4.5

                                     FORM OF


                       REGULATION D SUBSCRIPTION AGREEMENT


         THE  SECURITIES  OFFERED  HEREBY  HAVE  NOT  BEEN  REGISTERED  WITH THE
         SECURITIES  AND EXCHANGE  COMMISSION  OR ANY STATE OR OTHER  SECURITIES
         AUTHORITIES.  THEY MAY NOT BE SOLD OR TRANSFERRED EXCEPT PURSUANT TO AN
         EFFECTIVE  REGISTRATION  STATEMENT OR AN EXEMPTION TO THE  REGISTRATION
         REQUIREMENTS OF THOSE SECURITIES LAWS.

         THIS SUBSCRIPTION  AGREEMENT DOES NOT CONSTITUTE AN OFFER TO SELL, OR A
         SOLICITATION OF AN OFFER TO PURCHASE,  ANY OF THE SECURITIES  DESCRIBED
         HEREIN BY OR TO ANY PERSON IN ANY  JURISDICTION  IN WHICH SUCH OFFER OR
         SOLICITATION  WOULD  BE  UNLAWFUL.   THESE  SECURITIES  HAVE  NOT  BEEN
         RECOMMENDED BY ANY FEDERAL,  STATE OR FOREIGN  SECURITIES  AUTHORITIES,
         NOR HAVE ANY SUCH  AUTHORITIES  REVIEWED OR DETERMINED  THE ACCURACY OF
         THIS DOCUMENT. ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL.

         INVESTMENT  IN  THESE  SECURITIES  INVOLVES  A  HIGH  DEGREE  OF  RISK,
         INCLUDING  BUT NOT  LIMITED TO THOSE  RISK  FACTORS  IDENTIFIED  IN THE
         COMPANY'S  FORM S-3  FILED ON JULY 17,  2000  WITH THE  SECURITIES  AND
         EXCHANGE  COMMISSION.  INVESTORS MUST RELY ON THEIR OWN ANALYSIS OF THE
         INVESTMENT  TERMS AND  CONDITIONS OF THE PROPOSED  INVESTMENT AND THEIR
         OWN ASSESSMENT OF THE RISKS INVOLVED.

         This Regulation D Subscription  Agreement (the "Agreement") is executed
by the  undersigned  (the  "Subscriber")  in  connection  with the  offer to the
Subscriber  of, and the  subscription  by the Subscriber  for,  shares of Common
Stock, $.001 par value per share (the "Common Stock"), of SI DIAMOND TECHNOLOGY,
INC.,  a Texas  corporation  (the  "Company").  The  Company  shall  sell to the
Subscriber  _____________  shares of the  Company's  Common  Stock at a price of
$__________ per share, for an aggregate purchase price of $__________ .

         The solicitation of this  Subscription by the Company,  and if accepted
by the Company, the sale of the shares of Common Stock subscribed for, are being
made  on  reliance  upon  the  provisions  of  Regulation  D  ("Regulation   D")
promulgated under the Securities Act of 1933 (the "Securities Act").

         The  undersigned  Subscriber and the Company,  upon  acceptance of this
Agreement, hereby agree as follows:



<PAGE>

         1.       Offering

                  1.1  Offer to  Subscribe;  Purchase  Price  and  Closing;  and
Placement  Fees.  Subject to  satisfaction of the conditions to the closing of a
purchase  and sale of Common  Stock as to each  purchaser  of Common  Stock (the
"Closing")  set forth in Section  1.2 below,  the  Subscriber  hereby  offers to
subscribe for and purchase  shares of Common Stock,  for the aggregate  purchase
price set forth in Section 8 of this Agreement, all in accordance with the terms
and conditions of this Agreement. The Closing shall be deemed to occur when this
Agreement has been  executed by both the  Subscriber  and the Company,  and full
payment for the shares of Common  Stock  subscribed  for shall have been made by
the Subscriber, by wire transfer in United States Dollars, to the Company as set
forth  in  Section  7.1(a)  in  consideration  for  the  Company's  delivery  of
certificates representing the shares of Common Stock so subscribed for.

                  1.2      Conditions to  Subscriber's  Obligations.  The
                           ----------------------------------------
Subscriber's obligations hereunder are conditioned upon the occurrence of all of
the following:

                           (a)      other  than as  described  on  Schedule  1.2
                                    attached hereto, there have been no material
                                    adverse  changes in the  Company's  business
                                    prospects or financial  condition  since the
                                    date of the last balance  sheet  included in
                                    the  Disclosure  Documents (as defined below
                                    in Section 4.2);

                           (b)      the  representations  and  warranties of the
                                    Company  shall  be true and  correct  in all
                                    material respects on the date of Closing, as
                                    if made on such date,  and the Company shall
                                    deliver a certificate,  signed by an officer
                                    of the Company, to such effect; and

                           (c)      the Subscription Agreement has been accepted
                                    by the Company.

         2.  REPRESENTATIONS  AND WARRANTIES OF THE  SUBSCRIBER.  The Subscriber
hereby represents and warrants to the Company as follows (which  representations
and warranties shall be true as of the date of Closing):

                  2.1 Accredited Investor.  The Subscriber hereby represents and
                      -------------------
warrants to the Company that it is an "accredited  investor," as defined in Rule
501 of Regulation D, and has marked the applicable box set forth in Section 9 of
this Agreement signifying such status.

                  2.2 Investment Experience; Access to Information;
                      Independent Investigation.
                      ----------------------------------------------

                           2.2.1 Access to  Information.  The  Subscriber or its
                                 -----------------------
professional  advisor has been granted the  opportunity  to ask questions of and
receive  answers  from   representatives  of  the  Company,  and  its  officers,
directors,  employees  and agents  concerning  the terms and  conditions  of the
Offering,  and the Company and its  business  and  prospects,  and to obtain any
additional  information  which the Subscriber or its professional  advisor deems
necessary to verify the accuracy of the  information  received.  The  foregoing,
however,  does  not  limit  or  modify  the


                                       2
<PAGE>

Subscriber's right to rely upon representations and warranties of the Company in
Section 4 of this Agreement.

                           2.2.2 Ability to Evaluate.  The  Subscriber  has such
                                 -------------------
knowledge  and  experience  in financial  and business  matters that it is fully
capable of  evaluating  the merits and risks of an  investment  in the  Company,
including  without  limitation  those set forth in the Disclosure  Documents (as
defined below in Section 4.2).

                           2.2.3  Disclosure   Documents.   The  Subscriber  has
                           -----------------------------
received and  reviewed the  Disclosure  Documents  (as defined  below in Section
4.2). The foregoing, however, does not limit or modify the Subscriber's right to
rely upon the representations and warranties of the Company in Section 4 of this
Agreement.

                           2.2.4  Investment  Experience;  Fend  for  Self.  The
                                  ----------------------------------------
Subscriber  has  substantial  experience in investing in securities and has made
investments  in  securities  other than  those of the  Company.  The  Subscriber
acknowledges that it is able to fend for itself in the transaction  contemplated
by this  Agreement  and that it has the ability to bear the economic risk of its
investment in the Company. The Subscriber has not been organized for the purpose
of investing in securities of the Company.

                           2.2.5    Not an Affiliate.  The  Subscriber is not an
                                    ----------------
officer,  director  or  "affiliate"  (as that term is defined in Rule 415 of the
Securities Act) of the Company.

                  2.3 Exempt Offering Under Regulation D
                      ----------------------------------


                           2.3.1 Investment; No Distribution.  The Subscriber is
                                 ----------------------------
acquiring the shares of Common Stock subscribed for (the "Common Shares") solely
for investment  purposes for the Subscriber's own account (or for beneficiaries'
accounts  over  which  the   Subscriber   has   investment   discretion  but  no
discretionary  authority as to voting or  disposition)  and not with a view to a
distribution of all or any part thereof.  The Subscriber is aware that there are
legal and  practical  limits on its  ability  to sell or  dispose  of the Common
Shares and  therefore,  that the  Subscriber  must bear the economic risk of its
investment  for an indefinite  period of time. The Subscriber has adequate means
of providing for its current needs and anticipated contingencies and has no need
for  liquidity  of this  investment.  The  Subscriber's  commitment  to illiquid
investments is reasonable in relation to its net worth.

                           2.3.2 No General Solicitation. The Common Shares were
                                 -----------------------
not offered to the Subscriber  through,  and the Subscriber is not aware of, any
form  of  general  solicitation  or  general  advertising,   including,  without
limitation,  (i) any  advertisement,  articles,  notice  or other  communication
published  in any  newspaper,  magazine  or  similar  media  or  broadcast  over
television or radio,  and (ii) any seminar or meeting whose  attendees have been
invited by any general solicitation or general advertising.

                           2.3.3  No   Registration   of  Common   Shares.   The
                                  ---------------------------------------
Subscriber  understands  that the Common Shares are not registered and therefore
are "restricted  securities" under the federal  securities laws inasmuch as they
are being  acquired  from the Company in a  transaction  not  involving a public
offering, and that, under such laws and applicable regulations,  such securities
may not be transferred or resold without  registration  under the


                                       3
<PAGE>

Securities Act or pursuant to an exemption  therefrom.  In this connection,  the
Subscriber  represents  that it is familiar  with Rule 144 under the  Securities
Act, as presently in effect,  and  understands  the resale  limitations  imposed
thereby and by the Securities Act.

                           2.3.4  Disposition.  Without in any way  limiting the
                                  -----------
representations  set forth above, the Subscriber  further agrees not to make any
disposition of all or any portion of the Securities unless and until:

                                    (a)     There   is   then   in    effect   a
                                            registration   statement  under  the
                                            Securities    Act   covering    such
                                            proposed    disposition   and   such
                                            disposition  is made  in  accordance
                                            with such Registration Statement; or

                                    (b)     The  Subscriber  shall have notified
                                            the   Company   of   the    proposed
                                            disposition and shall have furnished
                                            the   Company    with   a   detailed
                                            statement   of   the   circumstances
                                            surrounding       the       proposed
                                            disposition,  and (ii) if reasonably
                                            requested   by  the   Company,   the
                                            Subscriber  shall have furnished the
                                            Company  with an opinion of counsel,
                                            reasonably   satisfactory   to   the
                                            Company,  that such disposition will
                                            not  require   registration  of  the
                                            Common  Shares under the  Securities
                                            Act.

                  2.4      Due Authorization.
                           -----------------

                           2.4.1  Authority.  The Subscriber,  if executing this
                                  ---------
Subscription Agreement in a representative or fiduciary capacity, has full power
and authority to execute and deliver this Subscription  Agreement and each other
document  referred to herein for which a signature is required in such  capacity
and on  behalf  of  the  subscribing  individual,  partnership,  trust,  estate,
corporation  or other entity for whom or which the  Subscriber is executing this
Subscription Agreement.

                           2.4.2  Due  Authorization.   The  Subscriber,  if  an
                                  ------------------
entity, is duly and validly organized,  validly existing and in good standing as
such entity under the laws of the  jurisdiction of its  organization,  with full
power and authority to purchase the Common Shares  subscribed for and to execute
and deliver this Agreement.

         3. Acknowledgments. The Subscriber is aware of the following:
            ---------------

                  3.1  Risks  of  Investment.  The  Subscriber  recognizes  that
                       ---------------------
investment in the Company involves  certain risks,  including the potential loss
of the  Subscriber's  investment  herein.  The Subscriber  recognizes  that this
Agreement and the exhibits  hereto do not purport to


                                       4
<PAGE>

contain all the information which would be contained in a registration statement
under the Securities Act;


                  3.2 No Government Approval.  The Subscriber  acknowledges that
                      ----------------------
no federal,  state or foreign  agency has passed upon or reviewed  the terms and
conditions  of the  Offering  or made any  finding  or  determination  as to the
fairness of the Offering;

                  3.3  Restrictions  on Transfer.  The  Subscriber may not sell,
                       -------------------------
transfer,  assign,  pledge or  otherwise  dispose  of all or any  portion of the
Securities  in the absence of either an effective  registration  statement or an
exemption  from  the  registration   requirements  of  the  Securities  Act  and
applicable state securities law;

                  3.4 Exempt  Transaction.  The Common  Shares are being offered
                      -------------------
and sold in reliance on specific  exemptions from the registration  requirements
of  federal  and state  law and the  Subscriber's  representations,  warranties,
agreements,  acknowledgments  and  applicability  of  such  exemptions  and  the
suitability of the Subscriber to acquire Common Shares.

                  3.5 Legends. It is understood that any certificates evidencing
                      -------
the Common Shares shall bear the following legend:

                  "The  securities  represented  hereby have not been registered
                  under the  Securities  Act of 1933, as amended,  or applicable
                  state  securities  laws, nor the securities  laws of any other
                  jurisdiction.  They  may  not be sold  or  transferred  in the
                  absence of an  effective  registration  statement  under those
                  securities   laws  or  an  opinion  of   counsel,   REASONABLY
                  satisfactory  to the  Company,  that the sale or  transfer  is
                  pursuant to an exemption to the  registration  requirements of
                  those securities laws."

         4.  Representations  and Warranties of the Company.  The Company hereby
             ----------------------------------------------
makes the following representations and warranties to the Subscriber,  except as
disclosed in the  Disclosure  Documents or  otherwise  disclosed to  Subscriber,
which  representations and warranties shall be true as of the date of acceptance
of this Agreement by the Company and as of Closing:

                  4.1  Organization,  Good  Standing,  and  Qualification.   The
                       --------------------------------------------------
Company is a corporation  duly organized,  validly existing and in good standing
under the laws of the State of Texas and has all requisite  corporate  power and
authority to carry on its business as now conducted and as currently proposed to
be conducted.  The Company is duly qualified to transact business and is in good
standing in each  jurisdiction  in which the failure to so qualify  would have a
material  adverse  effect on the business or  properties  of the Company and its
subsidiaries taken as a whole. The Company is not the subject of any pending or,
to its knowledge,  threatened or contemplated investigation or administrative or
legal proceeding by the Internal Revenue


                                       5
<PAGE>

Service,  the  taxing  authorities  of any state or local  jurisdiction,  or the
Securities and Exchange Commission,  or any state securities commission,  or any
other governmental  entity, which are required to be disclosed in the Disclosure
Documents and have not been disclosed.

                  4.2  Corporate  Condition.  The Company  has timely  filed all
                       --------------------
forms,  and reports and documents with the  Securities  and Exchange  Commission
required to be filed by it under the  Securities  Exchange Act 1934,  as amended
(the "Exchange Act") through the date hereof (collectively,  the "SEC Reports").
Each of the SEC Reports,  at the time filed,  complied in all material  respects
with the requirements of the Exchange Act. The Company has made available to the
Subscriber  a copy of the  Company's  Form  10-KSB  for the  fiscal  year  ended
December 31, 1999, and a copy of the Company's  Forms 10-QSB,  8-K and S-3 filed
by the Company since January 1, 2000 (the "Most Recent Filings  Report").  Other
than as set forth in Schedule 4.2 attached hereto and made a part hereof,  there
have been no material  adverse  changes in the  Company's  business,  prospects,
operations  or  financial  condition  since the date of the Most Recent  Filings
Report.  The SEC Reports,  together  with  Schedule 4.2 and any other  documents
listed on Schedule  4.2(a)  attached hereto and made a part hereof and furnished
herewith by the Company to the  Subscriber are referred to  collectively  as the
"Disclosure  Documents."  The financial  statements  contained in the Disclosure
Documents have been prepared in accordance  with generally  accepted  accounting
principles,  consistently  applied,  and fairly present in all material respects
the  consolidated  financial  condition  of the  Company  as of the dates of the
balance sheets included therein and the  consolidated  results of its operations
and cash flows for the periods then ended. Without limiting the foregoing, there
are no material liabilities,  contingent or actual that are not disclosed in the
Disclosure  Documents  (other  than  liabilities  incurred by the Company in the
ordinary course of its business,  consistent  with its past practice,  after the
periods covered by the Disclosure Documents).  The Company has paid all material
taxes which are due, except for taxes which it reasonably disputes.  There is no
material claim,  litigation,  or administrative  proceeding pending,  or, to the
best of the Company's knowledge, threatened or contemplated against the Company,
except  as  disclosed  in the  Disclosure  Documents.  This  Agreement  and  the
Disclosure Documents do not contain any untrue statement of material fact and do
not omit to state any  material  fact  required  to be stated  therein or herein
necessary to make the statements  contained  therein or herein not misleading in
the light of the circumstances under which they were made.

                  4.3  Authorization.  All  corporate  action on the part of the
                       -------------
Company  by  its  officers,   directors  and  shareholders   necessary  for  the
authorization,  execution and delivery of this Agreement, the performance of all
obligations  of the  Company  hereunder  and  the  authorization,  issuance  and
delivery of the Common Shares have been taken,  and this  Agreement  constitutes
valid and legally binding obligations of the Company,  enforceable in accordance
with their  terms;  provided,  however  that  enforceability  is subject to: (i)
applicable  bankruptcy,   reorganization,   insolvency,  moratorium,  fraudulent
conveyance, and similar federal and state laws affecting the rights and remedies
of creditors  generally,  and (ii)  general  principles  of equity  limiting the
availability of equitable  remedies  (including but not limited to the remedy of
specific  performance),  whether considered in a proceeding at law or in equity.
The Company has obtained all consents and approvals  required for it to execute,
deliver and perform this Agreement.



                                       6
<PAGE>

                  4.4 Valid Issuance of Common Shares.  The Common Shares,  when
                      -------------------------------
issued,  sold and  delivered  in  accordance  with  the  terms  hereof,  for the
consideration   expressed  herein,  will  be  validly  issued,  fully  paid  and
nonassessable  and, based in part upon the  representations of the Subscriber in
this  Agreement,  will be issued in compliance  with all applicable  federal and
state  securities  laws. The Common Shares will be issued free of any preemptive
rights.

                  4.5 Compliance with Other  Instruments.  The Company is not in
                      ----------------------------------
violation or default of any provisions of its Restated Articles of Incorporation
or Bylaws as amended and in effect on and as of the date of this Agreement or of
any material  provision of any material  instrument or contract to which it is a
party or by which it is bound  or, to its  knowledge,  of any  provision  of any
federal or state judgment,  writ, decree,  order,  statute, rule or governmental
regulation applicable to the Company, which would have a material adverse effect
on the Company's  business or prospects,  except as described in the  Disclosure
Documents.  The  execution,  delivery and  performance of this Agreement and the
consummation of the transactions contemplated hereby will not result in any such
violation or be in conflict with or  constitute,  with or without the passage of
time and giving of notice, either a default under any such provision, instrument
or  contract or an event which  results in the  creation of any lien,  charge or
encumbrance upon any assets of the Company.

                  4.6 Reporting Company. The Company is subject to the reporting
                      -----------------
requirements of the Exchange Act, and has a class of securities registered under
Section 12 or Section 15 of the Exchange Act. When requested by the  Subscriber,
the  Company  shall  furnish  copies of reports  filed by the  Company  with the
Securities and Exchange Commission.

                  4.7 Authorized  and Issued  Shares.  The authorized and issued
                      ------------------------------
shares of the Company preferred stock, Common Stock and warrants,  options,  and
instruments convertible into Common Stock as of August 31, 2000 are as set forth
on Exhibit A.

                  4.8  Use of  Proceeds.  As of the  date  hereof,  the  Company
                       -----------------
expects to use the proceeds  from the Offering  (less fees and expenses) for the
purposes set forth on Exhibit B hereto.  These  purposes are  estimates  and are
subject to change,  but  represent  the  Company's  good faith best  estimate of
anticipated uses.

                  4.9 Compliance  with Laws. As of the date hereof,  the conduct
                      --------------------
of the  business  of the  Company  complies in all  material  respects  with all
material statutes, laws, regulations,  ordinances,  rules, judgments,  orders or
decrees applicable  thereto.  The Company has not received notice of any alleged
violation of any statute, law, regulations,  ordinance, rule, judgment, order or
decree  from any  governmental  authority.  The  Company  shall  comply with all
applicable securities laws with respect to the Offering.

                  4.10  No  Rights  of  Participation.   No  person  or  entity,
                        -----------------------------
including,  but not limited to, current or former  shareholders  of the Company,
underwriters,  brokers,  agents or other third  parties,  has any right of first
refusal,  preemptive  right,  right of  participation,  or any similar  right to
participate in the Offering which has not been waived.



                                       7
<PAGE>

                  4.11 Disclosures. There is no fact known to the Company (other
                       -----------
than general  economic  conditions  known to the public  generally) that has not
been disclosed in the Disclosure Documents that (a) could reasonably be expected
to have a  material  adverse  effect on the  business,  financial  condition  or
results of operations of the Company,  or which could  reasonably be expected to
materially  and adversely  affect the properties or assets of the Company or (b)
could  reasonably be expected to materially and adversely  affect the ability of
the  Company to perform  its  obligations  pursuant  to this  Agreement  and the
issuance of the Securities.

                  4.12   Representations   True  and  Correct.   The   foregoing
                         ------------------------------------
representations, warranties and agreements are true, correct and complete in all
material respects,  and shall survive the Closing and the issuance of the Common
Shares.

                  4.13  Termination  Date of  Offering.  In no event  shall  the
                        ------------------------------
Closing occur later than  September 30, 2000,  with any extension  based upon an
agreement between the Company and the Subscriber.

                  4.14  Underwriter's  Fees and  Rights  of First  Refusal.  The
                        --------------------------------------------------
Company is not obligated to pay any compensation or other fees, costs or related
expenditures in cash or securities to any  underwriter,  broker,  agent or other
representative in connection with the Offering.

         5.       Covenants of the Company

                  5.1 Independent  Auditors.  The Company shall,  until at least
                      ---------------------
two (2)  years  after  the  date of the  Closing,  maintain  as its  independent
auditors an accounting  firm  authorized to practice  before the  Securities and
Exchange Commission.

                  5.2 Corporate Existence and Taxes. The Company shall, until at
                      -----------------------------
least  two (2) years  after  the date of the  Closing,  maintain  its  corporate
existence in good standing (provided, however, that the foregoing covenant shall
not  prevent  the  Company   from   entering   into  any  merger  or   corporate
reorganization so long as the surviving entity in such  transaction,  if not the
Company,   assumes  all  of  the  Company's  obligations  with  respect  to  the
Securities)  and shall pay all its taxes when due,  except  for taxes  which the
Company disputes.

                  5.3 Filings  with  Securities  and  Exchange  Commission.  The
                      ----------------------------------------------------
Company shall provide the  Subscriber  with copies of its annual reports on Form
10-KSB,  quarterly reports on Form 10-QSB and current reports on Form 8-K for as
long as the Common Shares remain outstanding.

                  5.4  Listing.  The  Company  shall  use its  best  efforts  to
                       -------
maintain the listing of its Common Stock on the OTC Bulletin Board or a national
securities exchange or national quotation system.



                                       8
<PAGE>

         6.       Miscellaneous

                  6.1   Representations  and  Warranties  Survive  the  Closing;
                        --------------------------------------------------------
Severability.  The Subscriber's and the Company's representations and warranties
------------
shall survive the Closing of the transaction provided for hereby notwithstanding
any due  diligence  investigation  made by or on behalf of the party  seeking to
rely thereon.  In the event that any provision of this  Agreement  becomes or is
declared by a court of competent  jurisdiction to be illegal,  unenforceable  or
void,  this  Agreement  shall  continue  in full force and effect  without  said
provision.

                  6.2 Successors  and Assigns.  The terms and conditions of this
                      -----------------------
Agreement  shall  inure to the  benefit  of and be binding  upon the  respective
successors  and assigns of the parties.  Nothing in this  Agreement,  express or
implied,  is intended to confer upon any party other than the parties  hereto or
their respective successors and assigns any rights,  remedies,  obligations,  or
liabilities under or by reason of this Agreement,  except as expressly  provided
in this  Agreement.  Neither party may assign its rights  hereunder  without the
prior written consent of the other parties.

                  6.3  Governing  Law. This  Agreement  shall be governed by and
                       --------------
construed  under the laws of the State of Texas  without  respect to conflict of
laws.

                  6.4 Execution in Counterparts Permitted. This Agreement may be
                      -----------------------------------
executed  in any  number of  counterparts,  each of which  shall be  enforceable
against the  parties  actually  executing  such  counterparts,  and all of which
together shall constitute one (1) instrument.

                  6.5 Titles and  Subtitles;  Gender.  The titles and  subtitles
                      ------------------------------
used  in  this  Agreement  are  used  for  convenience  only  and  are not to be
considered  in  construing  or  interpreting  this  Agreement.  The  use in this
Agreement of a masculine, feminine or neither pronoun shall be deemed to include
a reference to the others.

                  6.6  Written  Notices,  Etc.  Any  notice,  demand or  request
                       ----------------------
required or permitted to be given by the Company or the  Subscriber  pursuant to
the terms of this  Agreement  shall be in writing and shall be deemed given when
delivered  personally,  or by facsimile (with a hard copy to follow by overnight
or two (2) day  courier),  addressed  to the  parties  at the  addresses  and/or
facsimile telephone number of the parties set forth at the end of this Agreement
or such other address as a party may request by notifying the other in writing.

                  6.7 Expenses. Each of the Company and the Subscriber shall pay
                      --------
all  costs  and  expenses  that it  respectively  incurs,  with  respect  to the
negotiation, execution, delivery and performance of this Agreement.

                  6.8  Entire  Agreement;   Written  Amendments  Required.  This
                       --------------------------------------------------
Agreement,  the Common  Stock  certificates  and the other  documents  delivered
pursuant  hereto  constitute  the full and entire  understanding  and  agreement
between the parties with regard to the subjects hereof and thereof, and no party
shall be  liable or bound to any other  party in any  manner by any  warranties,
representations  or covenants except as specifically  set forth herein.  Neither
this


                                       9
<PAGE>


Agreement nor any terms hereof may be amended, waived,  discharged or terminated
other than by a written  instrument signed by the party against whom enforcement
of any such amendment, waiver, discharge or termination is sought.

         7.       Subscription and Wiring Instructions; Irrevocability.

                  7.1      Subscription
                           ------------

                           (a)      WIRE   TRANSFER   OF   SUBSCRIPTION   FUNDS.
                                    Subscriber shall send its subscription funds
                                    by wire transfer to the Company as follows:

                                    Bank:  Chase Bank  Texas  Account  Name:  SI
                                    Diamond   Technology,   Inc.   Account  No.:
                                    081-00053751 ABA Routing No.: 113000609

                           (b)      IRREVOCABLE  SUBSCRIPTION.   The  Subscriber
                                    hereby  acknowledges and agrees,  subject to
                                    the  provisions  of  any   applicable   laws
                                    providing  for the  refund  of  subscription
                                    amounts  submitted by the  Subscriber,  that
                                    this Agreement is  irrevocable  and that the
                                    Subscriber   is  not   entitled  to  cancel,
                                    terminate   or   revoke   this    Agreement;
                                    provided, however, that if the conditions to
                                    Closing   are  not   satisfied   or  if  the
                                    Disclosure Documents are discovered prior to
                                    Closing  to  contain  statements  which  are
                                    materially inaccurate, or omit statements of
                                    material facts, the Subscriber may revoke or
                                    cancel this Agreement.

                           (c)      COMPANY'S RIGHT TO REJECT SUBSCRIPTION. This
                                    Agreement  shall be  accepted by the Company
                                    when   the   Company    countersigns    this
                                    Agreement.  The Subscriber  hereby  confirms
                                    that the  Company has full right in its sole
                                    discretion   to   accept   or   reject   the
                                    subscription of the Subscriber,  in whole or
                                    in  part,  provided  that,  if  the  Company
                                    decides  to reject  such  subscription,  the
                                    Company  must do so promptly and in writing.
                                    In the case of  rejection,  the Company will
                                    promptly  return any  rejected  payments and
                                    (if   rejected  in  whole)   copies  of  all
                                    executed  subscription  documents (including
                                    without   limitation   this   Agreement)  to
                                    Subscriber.

                  7.2 Acceptance of  Subscription.  In the case of acceptance of
                      --------------------------
this subscription,  ownership of the number of securities being purchased hereby
will pass to the Subscriber upon the Closing.

                  7.3  Subscriber  to  Forward   Original  Signed   Subscription
                       ---------------------------------------------------------
Agreement  to  Company.  The  Subscriber  agrees to courier to the  Company  its
----------------------
original inked signed Subscription  Agreement within three (3) days after faxing
said signed Agreement to the Company.



                                       10
<PAGE>

         8. Number of Shares and  Purchase  Price.  The  undersigned  Subscriber
            -------------------------------------
hereby  subscribes  for and agrees to  purchase  ____________-  shares of Common
Stock for a total  purchase price (to be paid by wire transfer) in the amount of
______________________________ ($________) (the "Purchase Price").

         9.  Accredited  Investor.  The  Subscriber is (please check  applicable
             --------------------
box):

              (a)    [ ]    a corporation,  business  trust,  or partnership not
                            formed for the  specific  purpose of  acquiring  the
                            securities  offered,  with total assets in excess of
                            $5,000,000.

              (b)    [ ]    any   trust,   with   total   assets  in  excess  of
                            $5,000,000,  not formed for the specific  purpose of
                            acquiring the securities offered,  whose purchase is
                            directed  by a  sophisticated  person  who has  such
                            knowledge  and  experience in financial and business
                            matters that he is capable of evaluating  the merits
                            and risks of the prospective investment.

              (c)    [ ]    an individual, who

                     [ ]    is a director,  executive officer or general partner
                            of the  issuer of the  securities  being  offered or
                            sold or a  director,  executive  officer  or general
                            partner of a general partner of that issuer.

                     [ ]    has an individual net worth, or joint net worth with
                            that  person's  spouse,  at the time of the purchase
                            exceeding $1,000,000.

                     [ ]    had an  individual  income in excess of  $200,000 in
                            each of the two most  recent  years or joint  income
                            with that  person's  spouse in excess of $300,000 in
                            each of those years and has a reasonable expectation
                            of  reaching  the same  income  level in the current
                            year.

              (d)    [ ]    an  entity,   each  owner  of  which  is  an  entity
                            described  in (a) or (b)  above or is an  individual
                            described in (c) above.

         The undersigned  acknowledges  that this Agreement and the subscription
represented  hereby  shall not be  effective  unless  accepted by the Company as
indicated below.

            (The remainder of this page is intentionally left blank.)

                                       11
<PAGE>


         IN WITNESS WHEREOF, the undersigned Subscriber does hereby execute this
Agreement this _____ day of September, 2000.


Subscriber


-------------------------
Name:




                                       DELIVERY INSTRUCTIONS:
                                       ----------------------
                                       Please type or print address where your
                                       security is to be delivered


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

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

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


ACCEPTANCE BY COMPANY:


         THIS  SUBSCRIPTION IS ACCEPTED BY THE COMPANY AND THE COMPANY AGREES TO
BE BOUND BY THE TERMS AND CONDITIONS THEREOF THIS ______ DAY OF SEPTEMBER, 2000.



                                            By:________________________________

                                            Name:______________________________

                                            Title:_____________________________


                                       12
<PAGE>


                                   EXHIBIT "A"


                                 CAPITALIZATION


Shares of Common Stock Outstanding:           58,342,004

Series G Preferred Stock Outstanding:                900

Common Stock Options Outstanding:              4,189,493

Common Stock Warrants Outstanding:            10,080,000




                                       13
<PAGE>


                                   EXHIBIT "B"

                                 USE OF PROCEEDS

Working Capital






                                       14