UNITED STATES SECURITIES AND EXCHANGE COMMISSION

                          WASHINGTON, D.C.   20549
                                  ________

                                  FORM 8-K


                                CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report:  (Date of earliest event reported)  July 23, 1998


                            BIOSENSOR CORPORATION
            (Exact name of registrant as specified in its charter)


 Minnesota				                       0-11408              	41-1427114
(State or other jurisdiction    (Commission File No.)    	(IRS Employer
of incorporation)                                       Identification no.)


6 Woodcross Drive
Columbia, SC                                            29212
(Address of principal executive offices)              (Zip Code)

 (803) 407-3044 
(Registrant's telephone number, including area code)

ITEM 1.  CHANGE OF CONTROL OF REGISTRANT

	On July 23, 1998, Biosensor Corporation (the "Registrant") acquired all 
of the outstanding shares of capital stock of Carolina Medical, Inc., a 
Minnesota corporation, in exchange for 149,025.15 shares of the Registrant's 
Series A Preferred Stock.  The holders of the Series A Preferred Stock now 
have voting power equal to approximately eighty-three percent (83%) of the 
voting power of all issued and outstanding shares of the Registrant's capital 
stock.  Of the thirty-two (32) Series A Preferred Stock holders, the 
following eight (8) own more than four (4) per cent of the voting power of 
the Company. 



Name of Shareholder         Approximate Percentage of Ownership*
Ronald G. Moyer                           27.1%
C. Roger Jones                            10.6%
Ronald D. Ordway                          10.3%
Nishimoto Sangyo Co., LTD.                 8.4%
Bernard B. Klawans                         6.8%
Charles A. Barefoot                        4.9%
Counterpoint Capital Management, LLC       4.2%
Woodhaven Investors, Inc.                  4.2%
TOTAL FOR 8                              76.50%

*	calculated as if all issued and outstanding shares of Series A 
Preferred Stock were converted into Common Stock at the ratio of 96 
shares of Common Stock for each share of Series A Preferred Stock.

ITEM 2.  ACQUISITION OR DISPOSITION OF ASSETS.

On July 23, 1998, the Registrant acquired all of the outstanding shares 
of Carolina Medical, Inc. ("CMI"), a Minnesota corporation, pursuant to a 
Plan of Reorganization and Agreement (the "Plan") by and between the 
Registrant and CMI, dated May 29, 1998. The Registrant acquired 1,987,002 
shares of the CMI's Common Stock in exchange for 149,025.15 shares of its 
Series A Preferred Stock.  Each share of Series A Preferred Stock is 
convertible into 96 shares of the Registrant's Common Stock.  Each share of 
Series A Preferred Stock votes and participates in dividends and liquidations 
on an as-if-converted basis.  

		CMI was organized to facilitate the share exchange with the Registrant.  
Carolina Medical, Inc., a North Carolina corporation was recently merged with 
and into CMI.  CMI develops, manufactures, markets and services digital 
ultrasound imagers, electronic instruments for detecting circulatory system 
disorders and measuring the flow and pressure of blood, and cardiac 
monitoring systems. CMI has two subsidiaries: Braemar, Inc., and Advance 
Medical Products, Inc.  Braemar, Inc., a North Carolina corporation, is a 
wholly-owned subsidiary of CMI that develops, manufactures and markets tape 
recording devices for ambulatory ECG monitoring devices. CMI owns 
approximately 55% of the issued and outstanding common stock, and all of the 
issued and outstanding preferred stock, of Advanced Medical Product, Inc., a 
publicly held Delaware corporation, that develops, manufactures, and markets 
ambulatory ECG and blood pressure monitors. 


ITEM 5.  OTHER EVENTS

	On July 23, 1998, Dr. Stephen L. Zuckerman resigned as a director of 
the Registrant and the following five persons were appointed to serve as 
directors of the Registrant until the next annual meeting of shareholders:

Ronald G. Moyer
C. Roger Jones
L. John Ankney
Spencer M. Vawter
David Heiden

On July 21, 1998, the Registrant's Board of Directors authorized the 
merger of a wholly owned subsidiary of the Registrant, which has not yet been 
organized, with and into Advanced Medical Products, Inc., subject to certain 
terms and conditions.  The Registrant and Advanced Medical Products, Inc. are 
currently negotiating a definitive agreement. 

ITEM 7.  FINANCIAL STATEMENTS AND EXHIBITS.

        (a)	Financial statements of businesses acquired.

To be filed by amendment not later than October 6, 1998.

        (b)	Pro forma financial information.

 To be filed by amendment not later than October 6, 1998.

        (c)	Exhibits

(1)	Attached as Exhibit 1 please find the Plan of 
Reorganization and Agreement by and between Biosensor 
Corporation and Carolina Medical, Inc. dated May 29, 1998. 
	

ITEM 8.  CHANGE IN FISCAL YEAR

On July 23, 1998, the Registrant determined to change its fiscal year 
end to June 30, 1998 from May 31, 1998.  The Registrant will adopt the fiscal 
year of CMI, the accounting acquiror, and as such no transition report is 
necessary.





 SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, 
Registrant has duly caused this report to be signed on its behalf by the 
undersigned hereunto duly authorized.

			BIOSENSOR CORPORATION

By:_____________________________
     Ronald G. Moyer, Chief Executive Officer




































                                EXHIBIT 1

	                  PLAN OF REORGANIZATION	AND AGREEMENT


THIS PLAN OF REORGANIZATION AND AGREEMENT (the "Agreement") made this 
29th day of May 1998, by and among BIOSENSOR CORPORATION, a Minnesota 
corporation with its principal office located at 7001 East Fish Lake Road, 
Maple Grove, Minnesota 55311-2833 ("Biosensor"); and CAROLINA MEDICAL, INC., 
a North Carolina corporation with its principal office located at 157 
Industrial Drive, King, North Carolina 27021-0307 ("CMI");

	R E C I T A L S:

A.	Biosensor is and has been engaged in the design, manufacture and 
sale of ambulatory cardiac monitoring systems and other medical instruments 
and software.

B.	CMI is and has been engaged in the design, manufacture, sale and 
service of blood flow measurement instruments, ultrasound imaging systems, 
cardiac monitoring systems and other medical instruments and software.

C.	The parties desire to effect a reorganization of their respective 
businesses to enhance their ability to provide quality products and services.

D.	The parties desire to effect a reorganization pursuant to this 
Agreement in accordance with Section 368(a)(1)(B) of the Internal Revenue 
Code of 1986, as amended (the "Code").  It is contemplated that CMI will 
redomesticate to the State of Minnesota (as used in this Agreement, the 
definition "CMI" shall include reference to CMI of Minnesota, Inc., a 
Minnesota corporation, into which CMI intends to merge) and all of the 
outstanding shares of stock of CMI will be exchanged for shares of preferred 
stock of Biosensor as described below (the "Exchange").

NOW, THEREFORE, in consideration of the foregoing recitals and the 
mutual agreements set forth below, the parties agree as follows:

1.	Share Exchange.  Biosensor and CMI are the constituent 
corporations to the Exchange as contemplated by the Minnesota Business 
Corporation Act (the "MN Act").

1.1	Exchange.  Subject to the terms and conditions set forth in 
this Agreement, from and after the Effective Time (as defined in 
paragraph 1.3) of the Exchange:

(a)	Common Stock. All of the issued and outstanding 
shares of common stock of CMI shall be exchanged for shares of 
the Series A Preferred Stock of Biosensor as described in 
Paragraph 3.

(b)	Effect.  The separate corporate existence of CMI 
shall continue as a wholly-owned subsidiary of Biosensor, and CMI 
shall continue to possess all of its rights, privileges, powers, 
immunities, purposes and franchises, of a public as well as of a 
private nature; and all property, real, personal and mixed, and 
all debts due on whatever account, and all other choses in 
action, and all and every other interest, of or belonging to or 
due to CMI, shall remain vested in CMI.

(c)	Articles of Incorporation.  The Articles of 
Incorporation of neither party shall be amended by virtue of the 
Exchange, and they shall continue in effect as their respective 
Articles of Incorporation.

(d)	Bylaws.  The Bylaws of each party as constituted 
immediately prior to the Exchange shall remain their Bylaws.

(e)	Directors and Officers. The directors and officers of 
Biosensor shall be as set forth on Exhibit 1.1(e)-1, and the 
directors and officers of CMI shall be as set forth on Exhibit 
1.1(e)-2.

1.2	Filing; Plan of Share Exchange.  The Exchange shall not 
become effective unless this Agreement is duly approved by shareholders 
holding a majority of the shares of CMI, or such greater percentage as 
may be required by the MN Act.  Upon fulfillment or waiver of the 
conditions specified in this Agreement, the parties will cause Articles 
of Share Exchange in substantially the form of Exhibit 1.2 (the 
"Articles of Share Exchange") to be executed and filed with the 
Secretary of State of Minnesota.  The Plan of Share Exchange, which is 
a part of the Articles of Share Exchange, is incorporated herein by 
this reference, and adoption of this Agreement by the Boards of 
Directors of the parties and approval by CMI's shareholders shall 
constitute adoption and approval of the Plan of the Share Exchange.

1.3	Effective Time.  The Exchange shall be effective at the 
date and hour specified in the Articles of Share Exchange filed with 
the Secretary of State of Minnesota (the "Effective Time"), and, 
notwithstanding the actual time the Articles of Share Exchange  are 
filed with the Secretary of State of Minnesota, for tax and accounting 
purposes the Exchange shall be deemed to be effective as of 12:01 a.m. 
central time, July 1, 1998.


2.	Dissenting Shares.  Any CMI shareholder who shall have lawfully 
dissented from the Exchange in accordance with applicable law, and who has 
properly exercised such holder's rights to demand payment of the value of the 
holder's shares of common stock of CMI (the "Dissenting Shares") as provided 
by applicable law (a "Dissenting Shareholder"), shall thereafter have only 
such rights as are provided a Dissenting Shareholder in accordance with 
applicable law and shall have no rights under paragraph 3; provided; however, 
that if a Dissenting Shareholder shall withdraw (in accordance with 
applicable law) the demand for appraisal or shall become ineligible for such 
appraisal, then each of such Dissenting Shareholder's Dissenting Shares shall 
automatically cease to be a Dissenting Share and shall be converted into and 
represent only the right to receive the Consideration (as defined in 
paragraph 3(a)(i)), without interest, upon surrender of the certificate(s) 
representing such former Dissenting Share(s).

3.	Exchange Consideration.

(a)	Exchange Ratio; Issuance of Shares; Surrendering Procedure.

(i)	As of the Effective Time, by virtue of the Exchange 
and without any action on the part of the parties or the holders 
of record of CMI's issued and outstanding shares of common stock 
("CMI Shareholders"), each share of CMI's common stock issued and 
outstanding immediately prior to the Effective Time shall be 
converted into and shall represent the right to receive, upon 
surrender of the certificate(s) representing such shares of CMI's 
common stock, .075 shares of the Series A Preferred Stock of 
Biosensor, and Biosensor shall by virtue of the Exchange, and 
without any action on the part of Biosensor, be deemed to be the 
holder of record of the number of outstanding shares of CMI 
common stock issued and outstanding prior to the Effective Time 
(other than Dissenting Shares). A certified copy of the 
resolution of Biosensor's Board of Directors establishing its 
Series A Preferred Stock, which describes all of its rights, 
privileges, limitations and other attributes, is attached as 
Exhibit 3(a)(i). Any fractional shares which would result from 
the application of the foregoing conversion ratio shall be 
rounded to the nearest whole number, and no fractional shares 
shall be issuable by virtue of the Exchange.  The shares of stock 
to be issued by Biosensor pursuant to this paragraph shall be 
referred to as the "Consideration."

(ii)	The shares of capital stock of Biosensor issued and 
outstanding immediately prior to the Effective Time will not be 
converted, exchanged or altered in any manner as a result of the 
Exchange, and will remain outstanding as shares of Biosensor.


(iii)	Until surrendered, each outstanding certificate which 
prior to the Effective Time represented one or more shares of 
CMI's common stock shall be deemed upon the Effective Time for 
all purposes to represent only the right to receive the 
Consideration as described above.  If issuance of the 
Consideration is to be made to a person other than the one in 
whose name a certificate surrendered is registered, it shall be a 
condition of such payment that the certificate so surrendered 
shall be properly endorsed or otherwise in proper form for 
transfer, be free and clear of all liens, pledges, encumbrances, 
security interests and other restrictions and that the person 
requesting such payment shall pay to Biosensor any transfer or 
other taxes required by reason of the payment to a person other 
than the registered holder of the certificate surrendered or 
establish to the satisfaction of Biosensor that such tax has been 
paid or is not applicable.  With respect to any certificate for 
CMI's common stock that has been lost or destroyed, the 
Consideration attributable to such certificate shall be issued 
upon receipt of evidence and indemnity reasonably satisfactory to 
Biosensor of ownership of the shares represented thereby.  After 
the Effective Time, no transfer of the shares of CMI's common 
stock outstanding immediately prior to the Effective Time shall 
be made on the stock transfer books of CMI.

(iv)	As of the Effective Time, Biosensor shall cause to be 
delivered or mailed to each of CMI's Shareholders a form of 
letter of transmittal and instructions for use in effecting the 
surrender of the certificates which, immediately prior to the 
Effective Time, represented shares of CMI's common stock (the 
"Certificates") to be exchanged for the Consideration.  Upon 
surrender of the Certificates at Closing (defined in paragraph 4) 
or thereafter, together with such letter of transmittal, duly 
executed and completed in accordance with the instructions 
thereto, and such other documents as may be reasonably requested, 
Biosensor shall promptly (but not preceding the Effective Time) 
cause the Consideration to be paid to the persons entitled 
thereto.

(b)	Unregistered Securities.  CMI understands that (i) neither 
the shares of Biosensor's Series A Preferred Stock representing the 
Consideration, nor the shares of Biosensor's common stock into which it 
is convertible, shall be registered under The Securities Act of 1933 
(the "Securities Act"), as amended, or any state securities or "blue 
sky" laws, and as such must be held for any applicable holding period 
under Rule 144 of the Securities Act, or any successor rule or 
regulation and under any applicable state law, unless a disposition is 
registered under the Securities Act and under any applicable state law, 
or is exempt from registration, (ii) the certificates representing the 
Consideration (and the common stock into which it is convertible) shall 
bear a legend to such effect, and (iii) Biosensor will make or cause to 
be made a notation on its transfer books to such effect.  CMI shall 
inform each of its shareholders of the restrictions applicable to the 
Consideration as described above.

(c)	Amendment to Biosensor's Charter.  Biosensor has agreed, 
pursuant to paragraph 9(j), to submit to its shareholders for approval, 
proposals to effect a 1 for 6 reverse stock split of its issued and 
outstanding common stock and, following the consummation of same, to 
increase its authorized common stock to an amount sufficient to allow 
for the conversion of all of the Consideration into common stock of 
Biosensor.  In the event that Biosensor effects either or both of these 
adjustments to its capital structure prior to Closing, an appropriate 
adjustment shall be made in the amount of and/or type of Consideration 
issuable as a result of the Exchange.


4.	The Closing.  Except as may otherwise be agreed by the parties, 
the closing (the "Closing") of the Exchange shall take place at the offices 
of CMI's counsel, Blanco Tackabery Combs & Matamoros, P.A., in Winston-Salem, 
North Carolina, at 10:00 a.m. on June 30, 1998 (the "Closing Date"), but with 
effect as of the Effective Time.

5.	Mutual Representations and Warranties.  In order to induce each 
of the parties to enter into and consummate this transaction, Biosensor makes 
the following representations, warranties and covenants to CMI, and CMI makes 
the following representations, warranties and covenants to Biosensor, on the 
date hereof and on the Closing Date as if made on such date.  The following 
representations, warranties and covenants are being made by each of the 
representing parties only with respect to itself, and with respect to CMI its 
wholly-owned subsidiary, Braemar, Inc. ("Braemar"), but not with respect to 
Advanced Medical Products, Inc. ("AMP"), and the representations, warranties 
and covenants of the other party shall not be imputed to any other party to 
this Agreement.  References to "Items" as set forth below and elsewhere in 
this Agreement are references to each of the parties' Disclosure Schedules, 
which are attached to this Agreement and incorporated herein by this 
reference.

(a)	No Violation.  Except as shown in Item 5(a), the execution, 
delivery and performance of this Agreement and the consummation of this 
transaction do not and will not conflict with, contravene or result in 
a breach of any term or provision of, or constitute a default under, or 
result in the creation of any lien or encumbrance upon a party's 
properties or assets pursuant to, its Articles of Incorporation or 
Bylaws, or any agreement or other instrument to which such party is a 
party or by which it is bound or its properties are subject, or any 
law, rule, regulation, judgment, order or decree.  All consents by 
third parties that are required to prevent or eliminate every such 
conflict, breach, default, lien and encumbrance shall have been validly 
obtained before Closing and at Closing shall be in full force and 
effect and valid and sufficient for such purpose.

(b)	Equipment.  Item 5(b) contains a complete list of each 
party's material items of property and equipment, including all 
vehicles used in its business, tools, office furniture and equipment, 
computer equipment, equipment held for lease or rental, demo equipment, 
service equipment and all supplies.

(c)	Consents.  Except as set forth in Item 5(c), no 
authorizations, approvals or consents of, or filings with, any 
governmental agency or regulatory authority or any person are required, 
and no federal, state or local permits, licenses and similar 
authorizations are necessary, in order to properly effect this 
transaction.

(d)	Title. Except as set forth in Item 5(d), each party has 
good and marketable title in fee simple to all of its assets 
constituting real property and to all of its material assets 
constituting personal property, free and clear of any mortgage, pledge, 
lien, encumbrance, charge or title retention or other security 
arrangement.


(e)	Lawsuits.  Except as set forth in Item 5(e), there are no 
pending or, to the best of their knowledge, threatened actions, suits 
or proceedings against any party involving its assets or operations, 
nor, to the best of their knowledge, is there any basis for any such 
action or proceeding.  There is no outstanding order, judgment or 
decree of any court having jurisdiction in any way prohibiting the 
closing of this transaction or the operation of its business.

(f)	Condition of Assets.  To the best of their knowledge, all 
material facilities, equipment and all other material items of tangible 
property comprising the assets of each party are in good operating 
condition and repair, subject to normal wear and maintenance, are 
usable in the regular and ordinary course of business and conform to 
all applicable laws, ordinances, codes, rules and regulations relating 
to their construction, use and operation, the failure to comply with 
which would have a material adverse effect on such party.  Except as 
described in Item 5(f), no person other than such party owns any 
material items of equipment or other tangible assets or properties 
necessary to the operation of such party's business.

(g)	Names.  Each party uses only the names set forth in Item 
5(g) in its business.  To the best of their knowledge, the use of such 
names in the manner used by the parties does not infringe upon or 
violate the terms, conditions or provisions of any patent, trademark, 
service mark, trade name or copyright or other proprietary or similar 
rights of any third party or of any agreement to which such party is a 
party or by which such party is bound or of any judgment to which it is 
subject.

(h)	Tax Returns.  No party has any unpaid taxes, assessments 
(special, general or otherwise) or bonds of any nature affecting its 
assets or business, except for 1998 ad valorem taxes which are not yet 
due and payable.  Except as disclosed in Item 5(h), the parties have 
filed all returns and reports due to governmental authorities, the 
failure to so file would have a material adverse effect on its 
business, including but not limited to franchise, sales, withholding 
and income tax returns and reports, and no extension of due dates are 
in effect for any such returns and reports; each party has paid all 
taxes and other amounts due in respect of all such returns and reports; 
all such returns and reports are correct and complete to the best of 
their knowledge; no claim has been asserted that any such return or 
report is incorrect or incomplete; no audits are pending with respect 
to any such return or report; no party has extended the statute of 
limitations with respect to any tax return or report; and there are no 
unpaid deficiencies, additional taxes, penalties or interest.


(i)	Compliance with Laws. Except as set forth on Item 5(i), 
neither party has to the best of its knowledge committed any violation 
of or undertaken any act in contravention of any federal, state or 
local statute, rule or ordinance, including those pertaining to 
environmental laws, pollution control, waste management, hazardous 
waste or any similar statute, rule or ordinance, specifically including 
but not limited to the Comprehensive Environmental Response 
Compensation and Liability Act of 1980, as amended, the Hazardous 
Materials Transportation Act, as amended, the Resource Conservation and 
Recovery Act, as amended, and the regulations adopted thereunder, the 
violation of which would have a material adverse effect on such party.

(j)	Intangible Assets.  Set forth in Item 5(j) is a list of all 
material intangible or intellectual property used by each party in its 
business (including without limitation a list of all material clients 
and customers, patents, trademarks, service marks, copyrights, trade 
secrets, proprietary information and know-how).  To the best of their 
knowledge, there exists no restriction on the use or transfer of any 
such item.  There are no interferences, challenges, proceedings or 
infringement suits pending or, to the best of their knowledge, 
threatened with respect to any such item.  Except as set forth in Item 
5(j), no party has granted a license to any other person or entity with 
respect to any such item.

(k)	Compensation.  Each party has properly and accurately 
reflected on its books and records all compensation paid to, and 
perquisites provided to or on behalf of, its agents and employees.  
Such compensation and perquisites have been properly and accurately 
disclosed in its financial statements as described in this Agreement.  
Item 5(k) contains a complete list of all material employee benefit 
plans, whether formal or informal, whether or not set forth in writing, 
and whether covering one person or more, sponsored or maintained by 
each party, including without limitation, 401(k) plan, pension and 
profit sharing plans, sick leave, vacation and disability policies, 
insurance arrangements and the like.  

(l)	Affiliated Debt.  Except as set forth on their respective 
financial statements as described in this Agreement, (i) no party is 
indebted to any of its shareholders, directors, officers, employees or 
agents except for amounts due as normal salaries and wages, accrued 
vacation and sick leave and in reimbursement of ordinary expenses on a 
current basis, and (ii) no such shareholder, director, officer, 
employee or agent is indebted to a party except for advancements for 
ordinary business expenses in a normal amount not to exceed $100.00 for 
any one person.  Item 5(l) contains a complete list of all of such 
indebtedness, regardless of whether it is set forth on a party's 
financial statements.

(m)	Records.  The books of account and other corporate records 
of each party, including minute books and stock transfer books, are in 
all material respects complete, correct and current, and have been 
maintained in accordance with good business practices and the matters 
contained therein are accurately reflected in all material respects on 
their financial statements as described in this Agreement, to the 
extent appropriate.

(n)	Warranties.  There are no claims existing or, to the best 
of their knowledge, threatened under or pursuant to any warranty, 
whether expressed or implied, on products or services sold prior to the 
date of this Agreement. Item 5(n) sets forth a description of  all 
material, express warranties given by such party in the operation of 
its business.


(o)	No Options.  Except as set forth in Item 5(o), there are no 
existing agreements, options, commitments or rights with, of or to any 
person or entity to acquire any of the assets, properties or rights of 
a party, except for those contracts entered into in the normal course 
of business consistent with past practice for the provision of 
services.

(p)	Accounts Receivable.  All rights to the payment of money, 
whether or not earned by performance, and all accounts receivable, 
prepaid expenses, unbilled costs and fees, accounts, notes and other 
receivables of each party (including receivables from shareholders, 
directors, officers and employees), a detailed schedule of which as of 
the dates shown therein is set forth in Item 5(p), are valid and 
genuine; have arisen solely out of bona fide sales of product,  
performance of services and other business transactions in the ordinary 
course of business consistent with past practice; to the best of their 
knowledge, are not subject to valid defenses, set-offs or 
counterclaims; and, to the best of their knowledge, are collectible 
within ninety (90) days after billing at the full recorded amount 
thereof. There are no pending or, to the best of their knowledge, 
proposed or threatened actions, proceedings or audits by any 
governmental authority which is also a client or customer of any party 
pursuant to which such governmental authority is seeking to renegotiate 
any rates and charges previously established with any such authority 
for  any existing receivables.  The allowance for collection losses on 
each party's financial statements as described in this Agreement has 
been determined in accordance with generally accepted accounting 
principles consistent with past practice and, to the parties knowledge, 
are reasonably sufficient in amount as of this date and will be as of 
the Closing Date.

(q)	Insurance.  The assets, properties and operations of each 
party are insured under various policies of general liability, property 
and casualty, errors and omissions and other forms of insurance, all of 
which are described in Item 5(q), which discloses for each policy the 
risks insured against, coverage limits, deductible amounts, all 
outstanding claims thereunder, and whether the terms of such policy 
provide for retrospective premium adjustments.  All such policies are 
in full force and effect in accordance with their terms, no notice of 
cancellation has been received, and there is no known existing default 
or known event which, with the giving of notice or lapse of time or 
both, would constitute a default thereunder.  All premiums due thereon 
to date have been paid in full.  No party has been refused any 
insurance coverage, nor has any such coverage been limited, by any 
insurance carrier to which it has applied for such insurance or with 
which it has carried insurance.   Item 5(q) also contains a true and 
complete description of all outstanding bonds and other surety 
arrangements issued or entered into in connection with the business, 
assets and liabilities of each of the parties.


(r)	Undisclosed Liabilities.  Neither party has any liabilities 
or obligations with respect to its business, either direct or indirect, 
matured or unmatured, or absolute, contingent or otherwise, except (i) 
those liabilities or obligations set forth on its financial statements 
described in this Agreement and not heretofore paid or discharged; (ii) 
liabilities arising in the ordinary course of business under any 
agreement, commitment or plan as disclosed in Item 5(k); and (iii) 
those liabilities or obligations incurred, consistent with past 
business practice, in or as a result of the normal and ordinary course 
of business since such party's Interim Balance Sheet Date (as defined 
in paragraphs 6(b) and 7(b)).  Liabilities described in (ii) and (iii) 
herein are not, in the aggregate, materially greater in amount or type 
than the liabilities shown on the Financial Statements described in 
this Agreement.

(s)	No Interest in Other Entities.  Except as disclosed in Item 
5(s), no shares of any corporation or any ownership or other investment 
interest, either of record, beneficially or equitably, in any 
corporation, association, partnership, joint venture or other legal 
entity is owned by a party.

(t)	Transactions with Affiliates.  No shareholder, director, 
officer or employee of a party, or any member of his/her immediate 
family or any other of its, his or her affiliates, owns or has a five 
percent (5%) or more ownership interest in any corporation, other 
entity or proprietorship that is or was during the last three (3) years 
a party to, or in any property which is or was during the last three 
(3) years the subject of, any material contract, agreement or 
understanding, business arrangement or relationship with such party, 
except as set forth in Item 5(t).

(u)	Leased Real Property.  Item 5(u) contains a true and 
correct listing of all leases of real property by each party as lessor 
or sublessor, and to such party as lessee or sublessee, true and 
complete copies of every such lease and sublease being attached to the 
Disclosure Schedules.  Each such lease and sublease is, and as of the 
Effective Time shall be, in full force and effect and has not been 
assigned, modified, supplemented or amended and, to the best of their 
knowledge, neither a party hereto nor the landlord or (sub)lessee under 
any such lease is in default thereunder, and no circumstances or state 
of facts presently exist which, with the giving of notice or passage of 
time, or both, would permit the other party to such lease or sublease 
to terminate the same.


(v)	Employee Benefit Plans.  Set forth on Item 5(k) is an 
accurate and complete list of all employee benefit plans within the 
meaning of Section 3 of the Employee Retirement Income Security Act of 
1974, as amended, and the rules and regulations thereunder ("ERISA"), 
whether or not such employee benefit plans are otherwise exempt from 
the provisions of ERISA.  No party maintains or contributes to any 
employee benefit plan subject to ERISA which is not, or in the past has 
not been, in substantial compliance with ERISA, or which has incurred 
any accumulated funding deficiency, or which has applied for or 
obtained a waiver from the Internal Revenue Service of any minimum 
funding requirement under the Code.  No party has incurred any 
liability to the Pension Benefit Guaranty Corporation in connection 
with any employee benefit plan, and neither party knows of any facts or 
circumstances which might give rise to any such liability.  Full 
payment has been made of all amounts which such party is required, 
under applicable law or under the terms of any employee benefit plan or 
any agreement relating thereto, to have paid as contributions thereto 
as of the last day of the most recent fiscal year of such employee 
benefit plan ended prior to the date of this Agreement.  Each party has 
made adequate provision for reserves to meet contributions that have 
not been made because they are not yet due under the terms of any such 
plan or related agreements.  Each employee benefit plan intended to be 
qualified under Section 401(a) of the Code has been determined to be so 
qualified by the Internal Revenue Service, and nothing has occurred 
since the date of the last such determination which resulted or is 
likely to result in the revocation of such determination.  No party (or 
its predecessors) has been a party to any "multi-employer plan" as 
defined by Section 3(37) of ERISA.  No "reportable event" (as defined 
in Section 4043 of ERISA) has occurred with respect to any employee 
benefit plan maintained by a party, and no party has engaged in any 
transaction with respect to an employee benefit plan which would 
subject it to a tax, penalty or liability for prohibited transactions 
under ERISA or the Code, nor has its directors, officers or employees, 
to the extent any of them are fiduciaries with respect to such plans, 
breached any of their responsibilities or obligations imposed upon 
fiduciaries under ERISA.  The execution of, and consummation of the 
transactions contemplated by, this Agreement do not and will not 
constitute a triggering event under any employee benefit plan, policy, 
arrangement, statement, commitment or  agreement, whether or not 
legally enforceable, which (either alone or upon the occurrence of any 
additional or subsequent event) will or may result in any payment 
(whether of severance pay or otherwise), acceleration, vesting or 
increase in benefits to any of its employees, former employees or 
directors.

(w)	Conditions Affecting the Parties.  Except as described in 
Item 5(w), there is no fact, development or threatened development with 
respect to the markets, products, services, clients, customers, 
facilities, personnel, vendors, suppliers, operations, assets or 
prospects of a party's business which are known to such party which 
would materially adversely affect its business, operations or prospects 
considered as a whole, other than such conditions as may affect the 
economy generally.  Neither party has any reason to believe that any 
loss of any employee, agent, client, customer or supplier or other 
advantageous arrangement will result because of the consummation of the 
transactions contemplated by this Agreement.

(x)	Advances and Deposits.  Item 5(x) contains a complete list 
of each party's employee advances, refundable deposits and refundable 
dues, in each case in excess of $100, as of the dates shown therein.


(y)	Inventories.  Item 5(y) contains a complete list of all 
material items of each party's inventories as of the dates shown 
therein.  The inventory of the parties consists of raw materials and 
supplies, manufactured and purchased parts, goods in process and 
finished goods, all material portions thereof being merchantable and 
fit for the purpose for which it was procured or manufactured, subject 
only to the reserve for inventory writedown set forth on such party's 
balance sheet contained its Financial Statements described herein, as 
adjusted for the passage of time through the Closing Date in accordance 
with the past custom and practice of such party.

(z)	Software.  Item 5(z) contains a complete list of all 
material software licensed by or to each of the parties.

(aa)	Contracts.  Item 5(aa) contains a complete list of each 
party's material agreements, contracts and leases relating to its 
business; true and complete copies of each such contract being attached 
thereto.

(bb)	Life Insurance Policies.  Item 5(bb) contains a complete 
list of all life insurance policies owned by each party on the life of 
any shareholder, director, officer or employee, subject to policy loans 
outstanding in the amounts shown in the Disclosure Schedules as of the 
dates shown therein.

(cc)	Licenses and Permits.  Item 5(cc) contains a true, correct 
and complete list of all material governmental permits, licenses, 
registrations and other governmental consents which each party has 
obtained in connection with its assets or operations, and to the best 
of their knowledge no others are required.  All such permits, licenses, 
registrations and consents are in full force and effect, and the 
continued validity thereof shall not be adversely affected by the 
consummation of the Exchange.  No party has received any notice of any 
claim of revocation of any such permit, license, registration or other 
consent, nor does any party have knowledge of any event which might 
give rise to such a claim.

(dd)	Accounts.  Item 5(dd) lists the name and address of every 
financial institution at which a party maintains an account (whether 
checking, savings or otherwise), lock box or safety deposit box for its 
business, and the account numbers and names of persons having signing 
authority or other access thereto.

(ee)	Employees.  Except as set forth in Item 5(ee), no officer 
or key employee, or any group of key employees, intends to terminate 
his, her or their employment with the party, nor does the party have a 
present intention to terminate the employment of any of the foregoing.  
To the party's knowledge it has complied in all material respects with 
all applicable state and federal equal employment opportunity and other 
laws related to employment.  To the party's knowledge, none of its 
employees is obligated under any contract (including licenses, 
covenants or commitments of any nature) or other agreements, or that 
would interfere with the use of his or her best efforts to promote the 
interests of such party or that would materially conflict with the 
party's business as currently proposed to be conducted.


(ff)	Labor Agreements and Actions.  Neither party is bound by or 
subject to (and none of its assets or properties is bound by or subject 
to) any written or oral, express of implied, contract, commitment or 
arrangement with any labor union, and no labor union has requested or, 
to the party's knowledge, has sought to represent any of the employees, 
representatives or agents of such party.  There is no strike or other 
labor dispute involving either party pending or, to the party's 
knowledge, threatened, that could have a material adverse effect on the 
assets, properties, financial condition, operating results or business 
of such party (as such business is presently conducted and as it is 
proposed to be conducted), nor is the party aware of any labor 
organization activity involving its employees.

(gg)	Patents and Trademarks.  A complete and accurate list of 
all patents, patent applications, licenses, trademarks and copyrights 
owned by the party is set forth in Item 5(gg).  Each party has 
sufficient title and ownership of, or licenses to, all patents, 
trademarks, trade names, copyrights, trade secrets, information, 
proprietary rights and processes, without any conflict with or 
infringement of the rights of others, necessary for its business as now 
conducted and as currently proposed to be conducted.  Except as set 
forth in Item 5(gg), there are no outstanding options, licenses or 
agreements of any kind relating to the foregoing, nor is such party 
bound by or a party to any options, licenses or agreements of any kind 
with respect to the patents, trademarks, service marks, trade names, 
copyrights, trade secrets, licenses, information, proprietary rights 
and processes  of any other person or entity.  The party has not 
received any communications alleging that it has violated, or by 
conducting its business as proposed would violate, any patents, 
trademarks, service marks, trade names, copyrights or trade secrets or 
other proprietary rights of any other person or entity.

(hh)	Accuracy.  The information set forth in the parties' 
respective Disclosure Schedules is true, complete and accurate in all 
material respects.

(ii)	Representations.  No representation or warranty by a party 
in this Agreement or any instrument, certificate or statement furnished 
pursuant hereto, or in connection with this transaction, contains or 
will contain any untrue statement of a material fact or omit to state a 
material fact necessary to make the statements contained herein or 
therein not misleading.

6.	Representations and Warranties of Biosensor.  In order to induce 
CMI to enter into and consummate this transaction, in addition to the other 
representations, warranties and covenants set forth elsewhere in this 
Agreement, Biosensor represents, warrants and covenants to and with CMI on 
the date hereof and unless otherwise indicated, on the Closing Date as 
follows:


(a)	Authority.  Biosensor is a corporation duly formed and 
validly existing under the laws of the State of Minnesota, and is duly 
qualified in the State(s) listed in Item 6(a).  Subject to satisfaction 
of the conditions to Closing set forth in Section 10, Biosensor  has 
full power and authority to enter into and to perform its obligations 
under this Agreement, and this Agreement is, and all other documents 
delivered to CMI at Closing will be, duly executed and delivered on 
behalf of Biosensor, and the legal, valid and binding obligations of 
Biosensor, enforceable in accordance with their respective terms. 

(b)	Financial Statements.  Attached to Item 6(b) of Biosensor's 
Disclosure Schedules are financial statements of Biosensor 
(collectively, "Biosensor's Financial Statements"), consisting of a 
Balance Sheet and Statement of Operations dated May 31, 1997 and 1996 
audited by McGladrey & Pullen, and an internally prepared Statement of 
Income and Expenses and Balance Sheet as of February 28, 1998 (the 
"Interim Balance Sheet Date").  Each of Biosensor's  Financial 
Statements fairly present in all material respects the financial 
position and results of operations of Biosensor as of the dates thereof 
and for the periods indicated.  Since the Interim Balance Sheet Date, 
there has been, and will be, no material adverse change in the 
financial condition, results of operations, business or prospects of 
Biosensor, nor has there been any damage or destruction in the nature 
of a casualty loss, whether covered by insurance or not, that has had a 
material adverse effect on  Biosensor, its assets or business.  Since 
the Interim Balance Sheet Date, Biosensor has not engaged, and will not 
engage, in any transaction not in the ordinary course of business, 
including the transactions described in Section 8(c).  The internally 
prepared Financial Statements described above contain all adjustments, 
which are solely of a normal recurring nature, necessary to present 
fairly the financial position for the period then ended. 

(c)	Capitalization.  As of the date hereof, but not as of the 
Closing, the entire authorized capital of Biosensor consists of 
5,000,000 shares of capital stock, 4,850,000 of which are designated as 
Class A Common Stock and 150,000 of which have been designated Series A 
Preferred Stock (each of which is convertible into 96 shares of common 
stock).  Of the 4,850,000 shares of Class A Common Stock authorized, 
2,843,055 shares are issued and outstanding.  There are no shares of 
Series A Preferred Stock issued and outstanding.  Except as provided 
above or in Item 6(c) of Biosensor's Disclosure Schedules, there are no 
authorized, outstanding or existing (i) voting trusts or other 
agreements or understandings with respect to the voting of Biosensor's 
stock; (ii) securities convertible into or exchangeable for capital 
stock of Biosensor; (iii) options, warrants or other rights (including 
preemptive rights) to purchase, repurchase or to subscribe for any of 
Biosensor's capital stock, or any authorized but unissued shares of 
Biosensor's capital stock; (iv) agreements of any kind relating to the 
issuance of capital stock of Biosensor or any other type or form of 
securities or any options, warrants or rights; or (v) agreements of any 
kind which may obligate Biosensor to issue or repurchase any of its 
securities.  None of the issued and outstanding shares of Biosensor has 
been issued in violation of any preemptive or other rights of 
stockholders.


(d)	Shares.  The Consideration will, upon the issuance and 
delivery thereof in accordance with this Agreement, constitute legally 
and validly authorized and issued, fully paid and nonassessable shares 
of Series A Preferred Stock of Biosensor.  The shares of stock of 
Biosensor representing the Consideration will be issued to CMI's 
Shareholders in compliance with all applicable laws, rules and 
regulations, including the Securities Act and state securities or "blue 
sky" laws.

(e)	Reports.  Since December 31, 1994, Biosensor has filed all 
reports, registrations and statements, together with any required 
amendments thereto, that it was required to file with (i) The 
Securities and Exchange Commission ("SEC"), including but not limited 
to, Forms 10K, Forms 10Q and Proxy Statements, and (ii) all other 
governmental authorities maintaining regulatory jurisdiction over 
Biosensor.  All such reports and statements filed with any such 
regulatory body or authority are collectively referred to as the 
"Biosensor Reports."  As of their respective dates, the Biosensor 
Reports complied in all material respects with all the rules and 
regulations promulgated by the SEC, any applicable state securities 
authorities, and all other governmental or regulatory bodies or 
authorities maintaining jurisdiction over Biosensor, as the case may 
be, and did not contain any untrue statement of a material fact or omit 
to state a material fact required to be stated therein or necessary in 
order to make the statements therein, in light of the circumstances 
under which they were made, not misleading.  None of the information 
regarding Biosensor supplied by Biosensor for inclusion in any 
documents to be filed with the SEC or any regulatory authority in 
connection with this transaction will, at the respective times such 
documents are filed with the SEC or any regulatory authority and, with 
respect to any proxy statement when mailed and at the time of the 
meeting of shareholders referred to therein, be false or misleading 
with respect to any material fact or omit to state any material fact 
necessary in order to make the statements therein not misleading.  All 
documents (or portions thereof) which Biosensor prepares and is 
responsible for filing with the SEC and any other regulatory authority 
or body in connection with this transaction will comply as to form and 
substance in all material respects with the provisions of applicable 
law; provided, however, Biosensor disclaims any responsibility or 
liability for information included in such filings that was provided by 
CMI, its agents or representatives.

(f)	Contracts.  Item 6(f) lists the following contracts and 
other agreements to which Biosensor is a party:

(i)	Any agreement (or group of related agreements) for 
the lease of personal property to or from any person providing 
for lease payments in excess of $25,000 per annum;

(ii)	Any agreement (or group of related agreements) for 
the purchase or sale of raw materials, commodities, supplies, 
products or other personal property; for the furnishing or 
receipt of services, the performance of which will extend over a 
period of more than one year; or which will result in a loss to 
Biosensor, or involve consideration, in excess of $25,000;

(iii)	Any agreement concerning a partnership or joint 
venture;

(iv)	Any agreement (or group of related agreements) under 
which it has created, incurred, assumed or guaranteed any 
indebtedness for borrowed money, or any capitalized lease 
obligation, in excess of $25,000 or under which it has imposed a 
security interest on any of its assets, tangible or intangible;

(v)	Any agreement concerning confidentiality or 
noncompetition; 

(vi)	Any written agreement for the employment of any 
individual on a full-time, part-time, consulting or other basis 
providing annual compensation in excess of $75,000 or providing 
severance benefits;

(vii)	Any agreement under which it has advanced or loaned 
any amount to any of its directors, officers and employees 
outside the ordinary course of business;

(viii)	Any agreement under which the consequences of a 
default or termination could have a material adverse effect on 
the business, financial condition, operations, results of 
operations or future prospects of Biosensor; or

(ix)	Any other agreement (or group of related agreements) 
the performance of which involves consideration in excess of 
$50,000.

Biosensor has delivered to CMI a correct and complete copy of 
each written agreement listed in Item 6(f) (as amended to date) and a 
written summary setting forth the terms and conditions of each oral 
agreement referred to therein.  With respect to each such agreement: 
(A) the agreement is legal, valid, binding, enforceable and in full 
force and effect; (B) the agreement will continue to be legal, valid, 
binding, enforceable and in full force and effect on identical terms 
following the consummation of this transaction; (C) Biosensor is not in 
breach or default thereunder, and no event has occurred which with 
notice or lapse of time would constitute a breach or default by 
Biosensor, or permit termination, modification or acceleration, under 
such agreement, and (D) no party has repudiated any provision of the 
agreement.

70	Representations and Warranties of CMI.  In order to induce 
Biosensor to enter into and consummate this transaction, in addition to the 
other representations, warranties and covenants set forth in this Agreement, 
CMI represents, warrants and covenants to and with Biosensor on this date and 
as of the Closing Date as follows:


(a)	Corporate Organization of CMI.  CMI is a corporation duly 
organized, validly existing, and in good standing under the laws of the 
State of North Carolina. Following the completion of CMI's 
redomestication to Minnesota, CMI shall be a corporation duly 
organized, validly existing, and in good standing under the laws of the 
State of Minnesota.  Subject to satisfaction of the conditions to 
Closing set forth in Section 9, CMI has  full power and authority to 
enter into and to perform its obligations under this Agreement, and 
this Agreement is, and all other documents delivered to Biosensor at 
Closing will be, duly executed and delivered on behalf of CMI, and the 
legal, valid and binding obligations of CMI, enforceable in accordance 
with their respective terms.

(b)	Financial Statements. Attached to Item 7(b) of CMI's 
Disclosure Schedules are financial statements of CMI (collectively 
"CMI's Financial Statements") consisting of a Balance Sheet and 
Statement of Operations dated June 30, 1997 and June 30, 1996, audited 
by Royster Smith Shelton & Co., and an internally prepared Balance 
Sheet and Statement of Income and Expenses as of March 31, 1998 ("CMI's 
Interim Balance Sheet Date").  Also attached to Item 7(b) is an 
internally prepared Balance Sheet and Statement of Income and Expenses 
(collectively "Braemar's Financial Statements") as of March 31, 1998 
("Braemar's Interim Balance Sheet Date").  Each of CMI's and Braemar's 
Financial Statements fairly present in all material respects the 
financial position and results of operations of CMI or Braemar as of 
the date thereof and for the periods indicated.  Since the respective 
Interim Balance Sheet Dates for CMI and Braemar, there has been, and 
will be, no material adverse change in the financial condition, results 
of operations, business or prospects of CMI or Braemar, as the case may 
be, nor has there been any damage or destruction in the nature of a 
casualty loss, whether covered by insurance or not, that has a material 
adverse effect on CMI, its assets or business.  Since the Interim 
Balance Sheet Date, neither CMI nor Braemar has engaged, and neither 
will engage, in any material transaction not in the ordinary course of 
business, including the transactions described in Section 8(e).  The 
internally prepared Financial Statements described above contain all 
adjustments, which are solely of a normal recurring nature, necessary 
to present fairly the financial position for the period then ended.

(c)	Capitalization.  The entire authorized capital stock of CMI 
consists of 4,000,000 shares of common stock, par value $.20 per share, 
of which 1,974,608 shares are currently issued and outstanding and 
owned of record and beneficially as listed in Item 7(c) of CMI's 
Disclosure Schedules.  Except as described in Item 7(c) of CMI's 
Disclosure Schedules, there are no authorized, outstanding or existing 
(i) voting trusts or other agreements or understandings with respect to 
the voting of CMI's stock; (ii) securities convertible into or 
exchangeable for CMI's capital stock; (iii) options, warrants or other 
rights (including preemptive rights) to purchase, repurchase or 
subscribe for any of CMI's capital stock, or any authorized but 
unissued shares of CMI's capital stock; (iv) agreements of any kind 
relating to the issuance of stock of CMI, any other type or form of 
securities or any options, warrants or rights; or (v) agreements of any 
kind which may obligate CMI to issue or repurchase any of its shares of 
capital stock.

(d)	Intentionally Omitted.

(e)	Contracts.  Item 7(e) lists the following contracts and 
other agreements to which CMI or Braemar is a party:

(i)	Any agreement (or group of related agreements) for 
the lease of personal property to or from any person providing 
for lease payments in excess of $25,000 per annum;

(ii)	Any agreement (or group of related agreements) for 
the purchase or sale of raw materials, commodities, supplies, 
products or other personal property; for the furnishing or 
receipt of services, the performance of which will extend over a 
period of more than one year; or which will result in a loss to 
CMI or Braemar, or involve consideration, in excess of $25,000;

(iii)	Any agreement concerning a partnership or joint 
venture;

(iv)	Any agreement (or group of related agreements) under 
which it has created, incurred, assumed or guaranteed any 
indebtedness for borrowed money, or any capitalized lease 
obligation, in excess of $25,000 or under which it has imposed a 
security interest on any of its assets, tangible or intangible;

(v)	Any agreement concerning confidentiality or 
noncompetition; 

(vi)	Any written agreement for the employment of any 
individual on a full-time, part-time, consulting or other basis 
providing annual compensation in excess of $75,000 or providing 
severance benefits;

(vii)	Any agreement under which it has advanced or loaned 
any amount to any of its directors, officers and employees 
outside the ordinary course of business;

(viii)	Any agreement under which the consequences of a 
default or termination could have a material adverse effect on 
the business, financial condition, operations, results of 
operations, or future prospects of CMI or Braemar; or

(ix)	Any other agreement (or group of related agreements) 
the performance of which involves consideration in excess of 
$50,000.


CMI has delivered to Biosensor a correct and complete copy of 
each written agreement listed in Item 7(e) (as amended to date) and a 
written summary setting forth the terms and conditions of each oral 
agreement referred to therein.  With respect to each such agreement: 
(A) the agreement is legal, valid, binding, enforceable and in full 
force and effect; (B) the agreement will continue to be legal, valid, 
binding, enforceable and in full force and effect on identical terms 
following the consummation of this transaction; (C) neither CMI nor 
Braemar is in breach or default thereunder, and no event has occurred 
which with notice or lapse of time would constitute a breach or default 
by CMI or Braemar, or permit termination, modification or acceleration, 
under such agreement, and (D) no party has repudiated any provision of 
the agreement.

80	Mutual Covenants.  The parties each agree that pending Closing, 
except as otherwise agreed to in writing by the other party:

(a)	Consummation of Agreement.  They shall use their reasonable 
efforts to perform and fulfill all conditions and obligations on their 
respective parts to be performed and fulfilled under this Agreement, to 
the end that the transactions contemplated by this Agreement shall be 
fully carried out.

(b)	Prohibition Against Employment of Personnel.  In the event 
this transaction is not consummated, no party shall offer employment to 
any employee of the other or any of its affiliates for a period of 
twenty-four (24) months from the effective date of Closing.

(c)	Confidential Information.  The parties agree to receive and 
treat Confidential Information, as defined below, on a confidential and 
restricted basis and to undertake the following additional obligations 
with respect to the Confidential Information:

(i)	To use the Confidential Information for the sole 
purpose of evaluating the feasibility of consummating the 
transactions described in this Agreement;

(ii)	Not to disclose Confidential Information to any 
entity, individual, corporation, partnership, sole 
proprietorship, supplier, customer, client, attorney or 
accountant without the express written consent of the providing 
party, except for purposes of consummating or evaluating this 
transaction;

(iii)	To return all Confidential Information to the 
provider thereof and to destroy all notes and records regarding 
the Confidential Information, upon the termination of this 
transaction within five (5) days of receiving a written request 
from the providing party and to provide a written certification 
to the providing party that the recipient party has not retained 
any Confidential Information and has destroyed all notes and 
records regarding the Confidential Information prepared by or on 
behalf of the recipient;

(iv)	To cause all agents and employees of a party, 
including the agents and employees of any parent, subsidiary or 
affiliated corporations or business entities, having access to 
the Confidential Information to comply with the terms and 
conditions of this paragraph 8(c); and


(v)	For purposes of this Agreement, "Confidential 
Information" shall mean all written and verbal information 
provided by any party to the other in connection with this 
transaction regardless of its labeling as "Confidential."  
Confidential Information shall include, without limitation or 
restriction, any and all customer lists, pricing information, 
financial statements and information, agreements, records, 
supplier contracts, customer contracts, trade secrets, and 
business practices and methodologies.

(d)	Conduct of Business.  Their businesses shall be conducted 
solely in the ordinary course consistent with past practice.

(e)	Negative Covenants.  No party shall:

(i)	Incur any liabilities, other than liabilities 
incurred in the ordinary course of business consistent with past 
practice, or discharge or satisfy any lien or encumbrance, or pay 
any liabilities, other than in the ordinary course of business 
consistent with past practice, or fail to pay or discharge when 
due any liabilities of which the failure to pay or discharge will 
cause any material damage or risk of material loss to any of its 
assets or properties;

(ii)	Sell, encumber, assign or transfer any of its 
material assets or properties, except for the sale of inventory 
in the ordinary course of business consistent with past practice;

(iii)	Create, incur, assume or guarantee any indebtedness 
for money borrowed, or mortgage, pledge or subject any of its 
assets to any mortgage, lien, pledge, security interest, 
conditional sales contract or other encumbrance of any nature 
whatsoever;

(iv)	Make or suffer any amendment or termination of any 
material agreement, contract, commitment, lease or plan to which 
it is a party or by which it is bound, or cancel, modify or waive 
any substantial debts or claims held by it or waive any rights of 
substantial value, whether or not in the ordinary course of 
business;

(v)	Distribute any assets to any shareholder;

(vi)	Suffer any material adverse change in its business, 
operations, assets, properties or financial condition;

(vii)	Make commitments or agreements for any material 
capital expenditures or capital additions or betterments, except 
such as may be involved in ordinary and necessary repair, 
maintenance or replacement of its assets;


(viii)	Renew, extend, modify or enter into any 
existing or new employment contract, or increase the salaries or 
other compensation of, or make any advance (excluding advances 
for ordinary and necessary business expenses) or loan to, 
shareholders, directors, officers and employees or make any 
increase in, or any addition to, other benefits to which any of 
its employees may be entitled;

(ix)	Change any of the accounting principles followed by 
it or the methods of applying such principles;

(x)	Except as otherwise described in this Agreement or 
any party's Disclosure Schedules, enter into any transaction 
other than in the ordinary course of business consistent with 
past practice;

(xi)	Change its Articles of Incorporation (except, in the 
case of Biosensor, for those changes as described in this 
Agreement) or Bylaws, or issue any additional shares or options, 
warrants or other rights to acquire any of its shares or other 
securities (except, in the case of CMI, as described on Exhibit 
8(e)(xi); or

(xii)	Agree to any of the foregoing.

(f)	Maintenance.  They shall continue to maintain and service 
the physical assets used in the conduct of their businesses in the same 
manner as has been their consistent past practice.

(g)	Employees.  They shall use reasonable efforts to keep 
available the services of the present employees and agents of their 
businesses and to maintain the relations and goodwill with their 
suppliers, clients, customers, distributors and any others having 
business relations with them.

(h)	Insurance.  They shall notify the other party of any 
changes in the terms of its insurance policies and binders.

(i)	Compliance with Laws.  They shall comply with all laws, 
ordinances, rules, regulations and orders applicable to their 
businesses or operations, assets or properties in respect thereof, the 
noncompliance with which might materially adversely affect its 
business.


(j)	Disclosure.  Each party shall promptly disclose to the 
other party any information contained in its representations, 
warranties, Exhibits or Disclosure Schedules which, because of an event 
occurring after the date hereof, is incomplete or is no longer correct 
as of all times after the date hereof until the Effective Time; 
provided, however, but except as allowed pursuant to paragraph 23, that 
none of such disclosures shall be deemed to modify, amend or supplement 
such party's representations, warranties, Exhibits or Disclosure 
Schedules for the purposes of paragraphs 5, 6 and 7, unless the other 
party has consented thereto in writing.

(k)	Representations and Warranties.  Each party shall use 
reasonable efforts to conduct its business in such a manner that as of 
the Effective Time its representations and warranties contained in this 
Agreement shall be true, as though such representations and warranties 
were made on and as of such date.  Furthermore, each party shall 
cooperate with the other party and use reasonable efforts to cause all 
of the conditions to its obligations under this Agreement to be 
satisfied on or prior to the Closing Date.

(l)	No Mortgaging.  No party shall, directly or indirectly, 
sell or encumber all or any part of its assets, other than in the 
ordinary course of its business consistent with past practice, or 
initiate or participate in any discussions or negotiations or enter 
into any agreement to do any of the foregoing. 

(m)	Inspection and Access.  Each party shall give to the other 
party and its officers, employees, counsel, accountants and other 
representatives free and full access to and the right to inspect, 
during normal business hours, all of the premises, properties, assets, 
records, contracts and other documents relating to its business and 
shall permit them to consult with shareholders, employees, accountants, 
counsel and agents for the purpose of making such investigations as 
they shall desire to make, provided that such investigations shall not 
unreasonably interfere with the investigated party's business 
operations.  Furthermore, each party shall furnish to the other party 
all such documents and copies of documents and records and information 
with respect to the affairs of its business and copies of any working 
papers relating thereto as any party shall from time to time reasonably 
request and shall permit any party and its agents to make such physical 
inventories and inspections of the assets of its business as any party 
may request from time to time.

90	Conditions Precedent to CMI's Obligations.  All obligations of 
CMI under this Agreement are subject to the fulfillment or satisfaction, 
prior to or as of the Closing Date, of each of the following conditions 
precedent:


(a)	Accuracy of Representations and Warranties.  The 
representations and warranties of Biosensor contained in this Agreement 
or in any Exhibit, Disclosure Schedule, certificate or document 
delivered by Biosensor to CMI pursuant to this Agreement shall have 
been true on this date without regard to any updates furnished by 
Biosensor after this date and shall be true as of the Effective Time 
with the same effect as though such representations and warranties were 
made as of such date.  For purposes of determining the truth or 
accuracy of Biosensor's representations and warranties as of the 
Effective Time under this provision only, use of the terms "material" 
or "materiality" in or with respect to Biosensor's representations and 
warranties shall mean the loss or potential loss of $100,000 or more. 

(b)	Compliance with Agreement.  Biosensor shall have performed 
and complied with all agreements and conditions required by this 
Agreement to be performed or complied with by it prior to or at the 
Closing.

(c)	Legal Opinion.  Furber Timmer Zahn, PLLP, legal counsel for 
Biosensor, shall have delivered to CMI a written opinion, dated the 
Closing Date, which shall be in form and substance reasonably 
satisfactory to CMI and its counsel.

(d)	No Suits.  As of the Effective Time, no suit, action or 
other proceeding, or injunction or final judgment relating thereto of 
which any party has received notice, shall be threatened or be pending 
before any court or governmental or regulatory official, body or 
authority in which it is sought to restrain or prohibit or to obtain 
damages or other relief in connection with this Agreement or the 
consummation of the transactions contemplated hereby, and no 
investigation of which any party has received notice that might result 
in any such suit, action or proceeding shall be pending or threatened.

(e)	Consents.  All of the consents and approvals described in 
paragraph 5(c) shall have been obtained, together with all other 
consents or approvals which are reasonably determined by CMI to be 
necessary to the consummation of this transaction, and evidence thereof 
shall be provided to CMI at or prior to Closing.

(f)	No Material Adverse Effect.  The business, operations, 
assets, properties or prospects of Biosensor's business shall not have 
been, or be threatened to be, adversely affected in any material way as 
a result of any event or occurrence.  For purposes of this provision 
only, "materiality" shall mean the loss or potential loss of $100,000 
or more.

(g)	Employment Agreements.  Each of the key employees of 
Biosensor identified on Exhibit 9(g) shall have executed and delivered 
to it an employment agreement in form and content satisfactory to CMI.

(h)	Shareholder Approval.  The shareholders of CMI shall have 
approved the Exchange as required by applicable law, and CMI 
Shareholders holding no more than five percent (5%) of its common stock 
shall have given effective notice of intent to seek appraisal rights 
with respect to his or her shares of capital stock of CMI.

(i)	Release of Guaranty.  Biosensor's guaranty with regard to 
all financing for the construction and/or acquisition of Biosensor's 
facility at 7001 East Fish Lake Road,  Maple Grove, Minnesota shall be 
terminated and released, and evidence of same shall be provided to CMI.


(j)	Reverse Stock Split, Etc.  Biosensor shall have prepared 
and submitted to its shareholders a Proxy Statement which relates to 
proposals to (A) effectuate a 1 for 6 reverse stock split of all the 
outstanding shares of common stock of Biosensor and (B) amend 
Biosensor's Articles of Incorporation to (i)  change Biosensor's name 
to "BIOTEL Inc.," and (ii) increase the amount of authorized common 
stock (following the effectuation of the reverse stock split described 
above) to 10,000,000 shares.  CMI shall have the right to approve the 
form and content of this Proxy Statement, and Biosensor agrees that it 
shall use reasonable efforts to cause a meeting of shareholders to be 
held to act on the foregoing matters no later than July 31, 1998; 
provided, the parties acknowledge that certain aspects of holding a 
shareholders' meeting are not within the control of Biosensor.

(k)	Merger Consideration.  Biosensor shall have made the 
aggregate Consideration  available for issuance to CMI's Shareholders 
upon satisfaction of the surrender procedures set forth in this 
Agreement.

(l)	Certificate of Officer.  Biosensor shall deliver to CMI a 
certificate signed by Biosensor's chief executive officer and chief 
financial officer to the effect that each of the conditions specified 
in Section 9(a), (b), (f) and (j) have been satisfied in all respects.

100	Conditions Precedent to Biosensor's Obligations.  All obligations 
of Biosensor under this Agreement are subject to the fulfillment or 
satisfaction, prior to or as of the Closing Date, of each of the following 
conditions precedent:

(a)	Accuracy of Representations and Warranties.  The 
representations and warranties of CMI contained in this Agreement or in 
any Exhibit, Disclosure Schedule, certificate or document delivered by 
CMI to Biosensor pursuant to this Agreement  shall have been true on 
this date without regard to any updates furnished by CMI  after this 
date and shall be true as of the Effective Time with the same effect as 
though such representations and warranties were made as of such date.

(b)	Compliance with Agreement.  CMI shall have performed and 
complied with all agreements and conditions required by this Agreement 
to be performed or complied with by it prior to or at the Closing.  

(c)	Legal Opinion. Blanco Tackabery Combs & Matamoros, P.A., 
legal counsel for CMI, shall have delivered to Biosensor a written 
opinion, dated the Closing Date, which shall be in form and substance 
reasonably satisfactory to Biosensor and its counsel.


(d)	No Suits.  As of the Effective Time, no suit, action or 
other proceeding, or injunction or final judgment relating thereto of 
which any party has received notice, shall be threatened or be pending 
before any court or governmental or regulatory official, body or 
authority in which it is sought to restrain or prohibit or to obtain 
damages or other relief in connection with this Agreement or the 
consummation of this transaction, and no investigation of which any 
party has received notice that might result in any such suit, action or 
proceeding shall be pending or threatened.

(e)	Consents.  All of the consents and approvals described in 
paragraph 5(c) shall have been obtained, together with all other 
consents or approvals which are reasonably determined by Biosensor to 
be necessary to the consummation of this transaction, and evidence 
thereof shall be provided to Biosensor at or prior to Closing.

(f)	No Material Adverse Effect.  The business, operations, 
assets, properties or prospects of CMI's business shall not have been, 
or be threatened to be, adversely affected in any way as a result of 
any event or occurrence.

(g)	CMI Shareholder Approval.  CMI's shareholders shall have 
approved the Exchange as required by NC law and MN law and CMI 
Shareholders holding no more than five percent (5%) of CMI's common 
stock shall have given effective notice of intent to seek appraisal 
rights with respect to his or her shares of capital stock of CMI.

(h)	Certificate of Officer.  CMI shall deliver to Biosensor a 
certificate signed by CMI's chief executive officer and chief financial 
officer to the effect that each of the conditions specified in Section 
10(a), (b) and (g) have been satisfied in all respects.

110	Indemnity.

(a)	By Biosensor.  Biosensor agrees to indemnify and hold CMI 
and its directors, officers, employees, agents and representatives (an 
"Indemnified Party") harmless from and against any and all losses, 
costs, expenses, damages or liabilities (including, without limitation, 
court costs and attorneys' fees) incurred or suffered by an Indemnified 
Party arising out of, resulting from or attributable to any breach of 
any agreement or covenant or any representation or warranty by 
Biosensor contained in or given pursuant to this Agreement, regardless 
of the nature or the manner in which any such claims or liabilities 
arise.

(b)	By CMI.  CMI agrees to indemnify and hold Biosensor and its 
directors, employees, agents and representatives (an "Indemnitee") 
harmless from and against any and all losses, costs, expenses, damages 
or liabilities (including, without limitation, court costs and 
attorney's fees) incurred or suffered by an Indemnitee arising out of, 
resulting from, or attributable to any breach of any agreement or 
covenant or any representation or warranty by CMI contained in or given 
pursuant to this Agreement, regardless of the nature or the manner in 
which any such claims or liabilities arise.


(c)	Limitations.  Notwithstanding any provision contained 
herein to the contrary, an Indemnified Party or Indemnitee shall have 
no claim for indemnification hereunder unless such claim is asserted by 
the Indemnified Party or Indemnitee within 120 days after discovery and 
gives written notice to the indemnifying party of the discovery of any 
breach of any covenant, warranty, representation or agreement giving 
rise to a claim for indemnification as provided in this paragraph and 
such claim is asserted, as provided in this paragraph, not later than 
two (2) years from Closing.  In case any event shall occur which would 
otherwise entitle either party to assert a claim for indemnification, 
no loss, damage or expense shall be deemed to have been sustained by 
such party to the extent of (i) any tax savings realized by such party 
with respect thereto, or (ii) any proceeds received by such party from 
any insurance policy with respect thereto.  No party shall be liable 
under this provision for a loss resulting from any event relating to a 
breach of any representation or warranty if it can be established that 
the Indemnified Party or the Indemnitee had actual knowledge on or 
before Closing of such event.  Further, an Indemnified Party or 
Indemnitee shall be entitled to indemnification only when, and only 
with respect to amounts by which, the aggregate of all indemnifiable 
claims asserted by such party exceeds the sum of $25,000.

120	Remedies.  Nothing contained in this Agreement is intended to be 
or shall be construed so as to limit the remedies which either party may have 
against the other in the event of a breach by either party of any 
representation, warranty or agreement made under or pursuant to this 
Agreement, it being intended that any remedy shall be cumulative and not 
exclusive.  The parties agree that if any party is obligated to, but 
nevertheless does not, consummate this transaction, then the other party, in 
addition to all other rights or remedies, shall be entitled to the remedy of 
specific performance mandating that the other party or parties consummate 
this transaction.  In any action for specific performance by any party 
against any other party, the other party shall not plead adequacy of damages 
at law.

130	No Public Announcement.  The parties agree that they will make no 
public announcements concerning the Exchange or which makes reference to this 
transaction, unless each party has previously agreed to the content of such 
announcement or unless it is otherwise required by law.

140	Notices.  All notices and other communications under this 
Agreement shall be sufficient if given in writing and if delivered 
personally, with a receipt thereof obtained, or mailed, certified or 
registered mail, return receipt requested, postage prepaid, or by a 
recognized overnight delivery service, or by telecopier transmission to the 
parties at their respective addresses as set forth at the heading of this 
Agreement or to such other address as any party may designate from time to 
time by written notice to the other party.

Notices to CMI shall be sent with a copy to:  

Blanco Tackabery Combs & Matamoros, P.A.
P.O. Drawer 25008
Winston-Salem, NC   27114-5008
Attn:  Brian L. Herndon

Notices to Biosensor shall be sent with a copy to:

Furber Timmer Zahn, PLLP
1100 One Financial Plaza
120 South Sixth Street
Minneapolis, MN 55402-1801
Attn: Kevin S. Spreng

150	Expenses. The parties shall pay their own expenses incurred in 
connection with this Agreement.

160	Binding Agreement.  This Agreement shall be binding upon and 
inure to the benefit of the parties and their respective successors and 
assigns.  No party may assign all or any of its rights hereunder without the 
prior written consent of the other party.

170	Survival.  Notwithstanding any investigation by any party, all 
representations, warranties and agreements of any party made under or 
pursuant to this Agreement shall survive Closing for a period of two (2) 
years from the effective date of this transaction.

180	Governing Law.  This Agreement shall be governed by and construed 
in accordance with the laws of the State of North Carolina.

190	Liability for Finders' Fee.  Each party represents to the other 
party that it has not used the services of any broker or finder in connection 
with this transaction, and each party agrees to indemnify and hold the other 
party harmless from any and all liabilities (including, without limitation, 
court costs and attorneys' fees) for brokerage commissions or finders' fees 
claimed to be due or owing to any third party in connection with this 
transaction insofar as such claims shall be based on arrangements or 
agreements made by or on behalf of CMI or Biosensor, as the case may be.

200	Complete Agreement.  This Agreement and the documents and 
instruments contemplated hereby and thereby supersede all prior negotiations, 
agreements and understandings, whether oral or written, and may not be 
amended or supplemented except by an instrument, in writing, signed by the 
party or parties to be charged.

210	Counterparts.  This Agreement may be executed in any  number of 
counterparts, each of which shall be an original, but such counterparts 
together shall constitute one and the same instrument.

220	Further Assurances; Access to Information.  The parties agree 
that each will, at any time prior to, at or after the Effective Time, duly 
execute and deliver to the other any additional documents and instruments 
which the other may reasonably determine are necessary in connection with the 
consummation of this transaction.

230	CMI's Schedules. Biosensor acknowledges that neither CMI nor its 
legal counsel  have yet to review CMI's Schedules, and the Schedules 
previously provided by CMI to Biosensor are in draft form. CMI shall have 
until the close of business on June 5, 1998 to review its Schedules with its 
counsel if it so chooses, to supplement any previously provided Schedule and 
to provide any Schedule which was not provided to Biosensor as of or prior to 
the execution of this Agreement. 

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





	SEE SEPARATE SIGNATURE PAGES

	SEPARATE SIGNATURE PAGE 
	TO
	PLAN OF REORGANIZATION AND AGREEMENT



CAROLINA MEDICAL, INC., a North Carolina
  corporation

By:	
Name:	
Title:	
     

	SEPARATE SIGNATURE PAGE 
	TO
	PLAN OF REORGANIZATION AND AGREEMENT



BIOSENSOR CORPORATION, a Minnesota
  corporation

By:	
Name:	
Title:	   	









	LIST OF EXHIBITS


Exhibit 1.1(e)-1	-	Directors and Officers of Biosensor
Exhibit 1.1(e)-2	-	Directors and Officers of CMI
Exhibit 1.2		-	Articles of Share Exchange
Exhibit 3(a)(1)	-	Board of Directors Resolutions of Biosensor
Exhibit 8(e)(xi)	-	CMI Share Matters
Exhibit 9(g)		-	Key Employees

	BIOSENSOR DISCLOSURE SCHEDULES

	INDEX



Item 5(a)	-	Violations of Agreements, etc.
Item 5(b)	-	Equipment
Item 5(c)	-	Consents
Item 5(d)	-	Title Matters
Item 5(e)	-	Lawsuits and Claims
Item 5(f)	-	Condition and Ownership of Assets
Item 5(g)	-	Business Names
Item 5(h)	-	Taxes
Item 5(i)	-	Compliance with Laws
Item 5(j)	-	Intangible Assets
Item 5(k)	-	Employment Benefit Plans
Item 5(l)	-	Affiliated Debt
Item 5(n)	-	Warranties
Item 5(o)	-	Options with respect to Assets, etc.
Item 5(p)	-	Receivables
Item 5(q)	-	Insurance
Item 5(s)	-	Equity Investments
Item 5(t)	-	Transactions with Affiliates
Item 5(u)	-	Leased Real Property
Item 5(w)	-	Conditions Affecting the Parties
Item 5(x)	-	Advances and Deposits
Item 5(y)	-	Inventories
Item 5(z)	-	Software Licenses
Item 5(aa)	-	Contracts
Item 5(bb)	-	Life Insurance Policies
Item 5(cc)	-	Licenses and Permits
Item 5(dd)	-	Accounts
Item 5(ee)	-	Employees
Item 5(gg)	-	Patents and Trademarks
Item 6(a)	-	List of States Biosensor is Qualified to Do Business In
Item 6(b)	-	Financial Statements
Item 6(c)	-	Uncompleted Contracts
Item 6(f)	-	Contracts

	CMI DISCLOSURE SCHEDULES

	INDEX



Item 5(a)	-	Violations of Agreements, etc.
Item 5(b)	-	Equipment
Item 5(c)	-	Consents
Item 5(d)	-	Title Matters
Item 5(e)	-	Lawsuits and Claims
Item 5(f)	-	Condition and Ownership of Assets
Item 5(g)	-	Business Names
Item 5(h)	-	Taxes
Item 5(i)	-	Compliance with Laws
Item 5(j)	-	Intangible Assets
Item 5(k)	-	Employment Benefit Plans
Item 5(l)	-	Affiliated Debt
Item 5(n)	-	Warranties
Item 5(o)	-	Options with respect to Assets, etc.
Item 5(p)	-	Receivables
Item 5(q)	-	Insurance
Item 5(s)	-	Equity Investments
Item 5(t)	-	Transactions with Affiliates
Item 5(u)	-	Leased Real Property
Item 5(w)	-	Conditions Affecting the Parties
Item 5(x)	-	Advances and Deposits
Item 5(y)	-	Inventories
Item 5(z)	-	Software Licenses
Item 5(aa)	-	Contracts
Item 5(bb)	-	Life Insurance Policies
Item 5(cc)	-	Licenses and Permits
Item 5(dd)	-	Accounts
Item 5(ee)	-	Employees
Item 5(gg)	-	Patents and Trademarks
Item 7(b)	-	Financial Statements
Item 7(c)	-	Shareholdings, Options, etc.
Item 7(e)	-	Contracts


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