BSD MEDICAL CORPORATION ("BSD")
                     TERMS OF ENGAGEMENT
        BUILDING A NEW FINANCIAL STRUCTURE FOR GROWTH
                  REVISED NOVEMBER 21, 1996

FINANCIAL ADVISOR
Ambient Capital Group, Inc. ("Ambient")

ROLE
Financial Advisor to BSD to perform the following:

Phase I - Pre-Capital Raising Evaluation & Review of
Alternatives (4 to 6 weeks)

1.Complete due diligence of BSD from internal and external
  viewpoints including review of technology, competing
  companies and modalities.  This review will be in the
  context of specifically addressing the immediate and
  longer term capital needs of the various elements of the
  business.

2.Take the lead and coordinate all aspects of the
  preparation of the appropriate documents for raising
  capital. Specific end products developed in close
  association with management for Phase I will include:

     a.   An Information Memorandum which could be modified
     for a variety of capital raising approaches such as
     bridge financing, private placement with domestic or
     foreign investors, or corporate partner transactions.

     b.   A set of "Road Show" type slides suitable for
     gaining the interest of potential investors and capital
     intermediary participants in initial presentations. (A
     somewhat fuller set of horizontal "flip chart" type
     slides may also be created to be a stand-alone piece
     that can be easily digested by investors and
     intermediaries.)

     c.   Ambient will also provide input into the Company's
     Revised Business Plan as it may impact future financing
     efforts and as otherwise requested.

3.Identify a broad range of alternative financial
  strategies which may be suitable financing alternatives
  for BSD. These could include: bridge financing, private
  placement, secondary stock offering, joint venture on
  potential "service side" of the business, corporate
  partner transactions, rights offering and other
  approaches. However, as of the signing of this agreement,
  Ambient's exclusive rights to represent BSD shall be
  limited as discussed in "Exclusivity."

4.Research and evaluate each identified financial option
  relative to capital market possibilities and stated or
  logical potential investment interests of U.S. and
  foreign private investing groups and operating companies.

5.Review the findings of Phase I evaluation with BSD top
  management and, as required, its Board of Directors, with
  a view specifically towards the desirability and
  feasibility of each option, including costs, timing and
  likely success.

6.Assist management and, as appropriate, the Board in
  selecting the best alternative(s) to pursue.

Phase II - Capital Raising and Implementation of Selected
Alternatives-Typical Activities (To begin immediately upon
the completion of Phase I.)

1.Identify and approach investors, appropriate
  intermediaries and other sources of capital consistent
  with the alternative(s) selected.

2.Assist potential investors and other sources of capital
  with their due diligence; begin preliminary negotiations
  of terms.

3.Obtain preliminary commitments from capital sources (or
  proceed with offering in case of a public transaction).

4.Focus efforts on the best alternatives as they proceed to
  advanced due diligence.

5.Assist management and its counsel in negotiating
  commitments, underwriting agreements, agreements in
  principle, and similar documents.

6.Assist in negotiation of definitive agreements, formal
  due diligence and closing of transaction(s).

EXCLUSIVITY
With the signing of this agreement, Ambient shall become the
Company's exclusive financial advisor for private equity
financings only. Ambient may only obtain exclusivity for
other types of financings or transactions by mutual written
agreement. However, BSD must inform Ambient of its
intentions to be "in the market" with any other capital
raising efforts and Ambient and the Company agree to consult
with each other so that Ambient's capital raising efforts
are not undermined by the Company's alternative efforts.
Ambient will not be expected to take any actions to pursue
financing or transaction options for which it does not have
exclusivity.

TERM
12 months, cancelable after six months of Phase II with 30
days written notice by either Ambient or BSD. BSD may also
cancel Ambient's exclusivity after five months from the
signing of this agreement if it believes that Ambient is not
making reasonable efforts to secure financing proposals.
However, BSD agrees to consult with Ambient in advance of
such action to see if the situation can be resolved without
a cancellation of Ambient's contract or its exclusivity.

If Ambient is successful in raising at least $3 million of
financing for BSD during the initial 12 month term, or
completing another transaction which provides equivalent
value to BSD, then Ambient will have rights of first refusal
for an additional 18 month period to arrange additional BSD
equity financings which involve BSD stock or are convertible
into BSD stock. It is understood that Ambient's rights of
first refusal shall not extend to joint ventures, corporate
partners or similar investments unless these transactions
are specifically introduced by Ambient or completed through
Ambient at the Company's request. The Company shall also in
this circumstance take actions to see that Ambient is
involved at the compensation otherwise described in this
agreement if a subsequent public offering of the Company's
stock is completed during the 18 month period.

All contacts and financial sources identified and introduced
by Ambient shall be protected for a period of 12 months
after the termination or expiration of the engagement should
a financing, investment, or merger or acquisition
transaction occur with any of them. However, funding sources
which qualify for such success fees should only be those
introduced by or completed through Ambient within 12 months
of such termination or expiration.

FEES AND EXPENSES

Retainer Fees:
Phase I:  $10,000 due and payable upon the signing of this
agreement. Ambient shall also receive, at no cost, warrants
for unregistered common stock in the Company equal to 1.5%
of the total outstanding common stock, exercisable at a
strike price of $0.20 per share and valid for five years
from the date this agreement is signed. Ambient agrees to
own and hold these shares in accordance with relevant
securities laws. BSD will grant Ambient "piggy back" rights
with respect to registering the underlying common shares if
registration is completed on new shares .

Beginning with the start of Phase II, a retainer of $6,000
per month, payable in advance for a maximum of four months.

Success Fees:
Ambient shall receive additional cash fees and equity
interests contingent upon the completion of transactions
which either qualify as Ambient exclusive transactions or
which result in non Ambient exclusive transactions from
parties introduced to BSD by Ambient (see also
"Exclusivity"):

1.Senior secured debt (including lease or equipment type
  financing)-- 2.0% of principal amount of fund raised.

2.Mezzanine type subordinated debt -- 4.5% of principal
  amount of funds raised.

3.Private equity -- 8.0% of the principal raised or
  committed by institutional, private investors and other
  similar private funding sources in direct equity
  investments but excluding any private equity funding
  which includes manufacturing, sales or distribution of
  BSD's products, joint ventures, "corporate partner" or
  similar "strategic investments" unless Ambient introduces
  the investing party to this type of transaction with BSD
  or this transaction is completed through Ambient at BSD's
  written request and Ambient's agreement to such request.

4.Public equity -- Ambient shall receive a sum equal to 20%
  of the gross spread and other consideration paid to
  underwriters in a secondary public offering. For example,
  if the underwriters require a gross spread (underwriting
  commission) of 8%, then Ambient shall receive 1.6% plus
  20% of any other consideration such as an unallocated
  cash expense pool. In these situations, it is common for
  Ambient to receive some or all of this compensation from
  the underwriters, reducing the cost to BSD.

5.Sale of more than 50% of BSD equity, and/or similar
  merger or business combination involving an operating
  company or companies: 8.0% of the first $5 million in
  enterprise value of each of these transactions, 3.0% of
  amounts between $5 and $10 million, and 2.0% of all
  amounts between $10 million and $15 million, 1.0% on all
  amounts thereafter. (Note: For the purpose of this
  engagement, "enterprise value" shall be computed as the
  dollar value of equity invested and face value of debt
  created or assumed as part of each transaction.)

The cash portion of the success fee will be reduced by one-
half of all retainers paid by BSD. The success fees only
shall be reduced by 50% for any transaction involving Asset
Management ZUG in Switzerland.

For all transactions which involve a sale of equity in BSD
to third parties, Ambient shall also receive warrants for
common stock in BSD equal to 10%, on a fully-diluted basis,
of the equity percentage of BSD sold on the completion of
these transactions which either qualify as Ambient exclusive
transactions or which result from non Ambient exclusive
transactions from parties introduced to BSD by Ambient. (See
"Exclusivity.")  The warrants will have an exercise price
equal to the same price per share as paid by the investor
and will be valid for five years from the date the financing
is closed. (Thus, if a transaction is arranged which results
in a sale of 30% of the Company's outstanding shares, then
Ambient shall receive warrants for an additional 3% equity
interest in the Company.)

Ambient shall cooperate with other agents and may separately
compensate such agents from Ambient's fees if it determines
that this is in the best interests of Ambient and the
Company.

EXPENSES/OTHER
Reimbursement of all reasonable out-of-pocket expenses
(including fees and disbursements of legal counsel, if
required), with prior approval of significant travel-related
expenses. Customary indemnification normally accorded
investment banking firms in similar situations from losses,
claims or damages resulting from Ambient's services.
(Indemnification will be subject to a separate
indemnification agreement.)

Within 15 days of the signing of this engagement agreement,
BSD will deposit with Ambient $2,500 to be applied towards
Ambient's out-of-pocket expenses. BSD may be required to
make additional advance expense deposits if and when the
initial expense deposit has been used. Any unused expense
deposits shall be refunded to BSD. BSD and Ambient will
agree on the need and likely costs of separate counsel for
Ambient before such counsel is retained (e.g., for
specialized securities issues). Ambient shall use reasonable
efforts to control expenses and shall inform the Company of
planned individual expenditures of more than $750 (e.g. for
travel) for the Company's reasonable pre-approval of the
general amount and purpose of the expense. Ambient shall
provide a detailed reporting of expenses on a monthly basis.

BSD is under no obligation to complete a transaction
recommended by the Ambient. BSD's Board of Directors retains
its right to accept or reject any financing offer brought to
it by Ambient or any other source of financing.  BSD will
have no further obligation to Ambient other than that
outlined in the Retainers Fees section if it rejects all
financing proposals.

AGREED TO AND ACCEPTED

BSD MEDICAL CORPORATION

By:  /s/ Paul F. Turner                      November 26, 1996
   Paul F. Turner                            Date
   Chairman of the Board, Acting President,
   and Sr. Vice President of Research

AMBIENT CAPITAL GROUP INC.

By:  /s/ Gary M. Post                        November 26, 1996
   Gary M. Post                              Date
   Managing Director