Exhibit  4.6

 Form of Secured  Convertible Promissory Note between the Company as maker and private  lenders  to the Company

**NEITHER THIS  EXCHANGEABLE DEMAND PROMISSORY NOTE NOR THE SECURITIES FOR WHICH IT MAY BE  EXCHANGED HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED  (THE “ACT”), OR THE SECURITIES LAWS OF ANY STATE AND NEITHER THIS NOTE NOR  SUCH SECURITIES MAY BE SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF AN  EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT AND LAWS UNLESS MAKER RECEIVES  AN OPINION OF COUNSEL REASONABLY ACCEPTABLE TO IT THAT SUCH REGISTRATION IS  NOT REQUIRED.**

**EXCHANGEABLE  DEMAND PROMISSORY NOTE**

| $ _________ | Date____________ |
|-------------|------------------|

             FOR VALUE RECEIVED, the undersigned, SI Diamond Technology, Inc., a Texas  corporation (“**Maker**”), promises to pay to, ___________ (“**Payee**”)  Payee and any subsequent holder(s) hereof are individually and collectively  referred to as the “**Holder**”), or order, the sum of  _______________________ Dollars ($_______), or so much thereof as may from  time to time hereafter be outstanding hereunder, whichever is less, together  with interest thereon, all as hereinafter provided.

             1.         Interest  and Principal Payments.

             a.          Payment on this Note shall be made six months after its execution (the “**Demand  Date**”). In lieu of cash, holder may elect to receive shares of  the  common stock of Maker (“Stock”) in payment of the note at a _____ discount  off of the then current Market Price (as defined below) in accordance with  Section 3 hereof.

             b.         From  the date hereof to and including the date this Note is paid or otherwise  discharged, the unpaid principal amount of this Note shall bear simple  interest at a rate of fifteen percent (15%) per annum, computed on the basis  of a year of three hundred sixty five (365) days.

             c.         All  payments of principal and interest shall be made in lawful money of the United  States of America (except as provided in Sections 1 and 3) and shall be made  to Holder at Holder’s address set forth in Section 8 or at such other place  as Holder may designate to Maker in writing.

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             2.         Prepayments.     This note may be prepaid without penalty, in whole or in part, at any time  prior to the due date of the note, at the option of the Holder, in lawful  money of the United States of America. Interest shall be calculated from the  date of the note to the date of prepayment, if applicable.

             3.         Exchange  of Note for Stock.  Notwithstanding the other terms and conditions of  this Note, the Holder shall have the option of exchanging this Note for shares  of Stock at the maturity date of the Note.  The number of shares of Stock  into which this Note may be exchanged shall be equal to the number of shares  of Stock computed by dividing the principal amount of this Note, plus any  accrued but unpaid interest, by ___% of the Market Price.

             For purposes hereof, the term “Market Price” shall mean the average of the  daily closing prices per share of the Stock for the five (5) consecutive  trading days immediately preceding the due date of the note, ________,  2002.  The closing price for each day shall be the last sale price  regular way or, in case no such sale takes place on such day, the average of  the closing bid and asked prices regular way, on the NASDAQ OTC Bulletin  Board.

             4.         Exchange  Procedures; Reservation of Shares.

             a.         Upon  the exchange of this Note for shares of Stock, Maker shall, as soon as  practicable, take all such steps as may be necessary to issue such Stock in  exchange for this Note, and thereafter deliver to Holder a certificate or  certificates for the number of shares of Stock to which Holder shall be  entitled against receipt of this Note, duly endorsed for cancellation.

             b.         Maker  covenants that it will, at the Exchange Date, make available out of its  authorized Stock, solely for the purpose of issue upon exchange of this Note  for Stock, such number, class and series of shares of Stock as shall then be  issuable upon the exchange of this Note.

             5.         Events of Default.   The occurrence or existence of any one of the following events or conditions  shall constitute an “**Event of Default**”:

             a.         Maker shall fail to pay the  principal of, this Note when the same becomes due and payable in accordance  with the terms hereof and after demand for payment has been made therefor and  such amount remains unpaid for ten (10) days after such date;

             b.         Maker fails to observe or  perform any covenant or agreement on the part of Maker contained in this Note  for a period of thirty (30) days after the date on which written notice of  such failure, requiring the same to be remedied, shall have been given to  Maker by Holder of this Note;

             c.         Maker makes a general  assignment for the benefit of its creditors or applies to any tribunal for the  appointment of a trustee or receiver of a substantial part of the assets of  Maker, or

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commences any proceedings relating to Maker under any bankruptcy,  reorganization, arrangement, insolvency, readjustment of debts, dissolution or  other liquidation law of any jurisdiction; or any such application is filed,  or any such proceedings are commenced against Maker and Maker indicates its  consent to such proceedings, or an order or decree is entered by a court of  competent jurisdiction appointing such trustee or receiver, or adjudicating  Maker bankrupt or insolvent, or approving the petition in any such  proceedings, and such order or decree remains unstayed and in effect for  ninety (90) days.

             6.         Remedies.

             a.         If an Event of Default  occurs and is continuing, Holder of this Note may, by notice in writing to  Maker, declare the entire unpaid principal of the Note to be due and payable  immediately, and upon any such declaration the principal and unpaid interest  of the Note shall become and be immediately due and payable, and Holder of  this Note may thereupon proceed to protect and enforce its rights either by  suit in equity or by action of law or by other appropriate proceedings,  whether for specific performance (to the extent permitted by law) of any  covenant or agreement contained herein or in aid of the exercise of any power  granted herein, or proceed to enforce the payment of this Note or to enforce  any other legal or equitable right of such Holder.

             7.         Notices; Miscellaneous.

             a.         All notices, requests,  consents and other communications required or permitted under this Note shall  be in writing and shall be deemed to have been delivered three (3) days after  the date mailed, postage prepaid, by certified mail, return receipt requested,  or on the date personally delivered:

                         i.          If to Payee, to:

                                     ____________________                                       ____________________                                       ____________________                                       ____________________

                         ii.          If to Maker, to:

                                     SI Diamond Technology, Inc.                                       3006 Longhorn Boulevard, Suite 107                                       Austin, Texas 78758                                       Attention: Douglas P. Baker, Vice President

                         iii.         If to any other holder  other than Payee, to such address as may have been designated by notice given  Maker by such Holder.

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Maker, Payee or any  other Holder hereof may designate a different address by notice given in  accordance with the foregoing.

                         b.         From time to time, without  affecting the obligations of Maker or its legal representatives, successors or  assigns to pay the outstanding principal balance of this Note and observe the  covenants of Maker contained herein and in the documents and instruments  related hereto, without giving notice to or obtaining the consent of Maker, or  its legal representatives, successors or assigns, and without liability on the  part of Holder, Holder may, at the option of Holder, extend the time for  payment of said outstanding principal balance or any part thereof, reduce the  payments thereon, release anyone liable on any of said outstanding principal  balance, accept a renewal of this Note, modify the terms of payment of said  outstanding principal balance in any manner more favorable to Maker or join in  any extension or subordination agreement, and agree in writing with Maker to  modify the rate of interest or period of amortization of this Note or change  the amount of the payments hereunder.  No one or more of such actions  shall constitute a novation or otherwise affect or impair the indebtedness  evidenced hereby.

             9.         Compliance with  Securities Laws.  The Holder of this Note, by its acceptance of this  instrument, represents and acknowledges that this Note is acquired for the  Holder’s own account for investment purposes and that this Note and the Note  Shares issuable upon exercise hereof (the “**Note Shares**”),  respectively, have not been registered under the Securities Act of 1933, as  amended.  Accordingly, any transfer of this Note and such Note Shares  shall be subject to legal restrictions.  The Holder agrees that it will  not offer for sale or sell, assign or otherwise dispose of (except exchange of  the Note for Note Shares) this Note or any Note Shares issued to it pursuant  to exercise hereof, except in accordance with applicable securities  laws.  The Note Shares shall bear a legend similar to the legend on this  Note. Maker agrees to use its best efforts to register the Note Shares prior  to the due date of this Note.

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            This  Note and the rights and obligations of the parties hereunder shall be governed  by, and construed and interpreted in accordance with, the laws of the State of  Texas (without regard to principles of conflicts of laws) and applicable  Federal law.

                                                             **SI Diamond Technology, Inc.**

**                                                           ________________________                                                               By:      Douglas P. Baker                                                               Title:   Vice President**