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<SEC-DOCUMENT>0000927946-07-000005.txt : 20070118
<SEC-HEADER>0000927946-07-000005.hdr.sgml : 20070118
<ACCEPTANCE-DATETIME>20070117173119
ACCESSION NUMBER:		0000927946-07-000005
CONFORMED SUBMISSION TYPE:	DEF 14A
PUBLIC DOCUMENT COUNT:		3
CONFORMED PERIOD OF REPORT:	20060930
FILED AS OF DATE:		20070118
DATE AS OF CHANGE:		20070117
EFFECTIVENESS DATE:		20070118

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			BIOANALYTICAL SYSTEMS INC
		CENTRAL INDEX KEY:			0000720154
		STANDARD INDUSTRIAL CLASSIFICATION:	SERVICES-COMMERCIAL PHYSICAL & BIOLOGICAL RESEARCH [8731]
		IRS NUMBER:				351345024
		STATE OF INCORPORATION:			IN
		FISCAL YEAR END:			0930

	FILING VALUES:
		FORM TYPE:		DEF 14A
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-23357
		FILM NUMBER:		07535942

	BUSINESS ADDRESS:	
		STREET 1:		2701 KENT AVE
		CITY:			WEST LAFAYETT
		STATE:			IN
		ZIP:			47906-1382
		BUSINESS PHONE:		3174634527

	MAIL ADDRESS:	
		STREET 1:		2701 KENT AVENUE
		CITY:			WEST LAFAYETTE
		STATE:			IN
		ZIP:			47906-1382
</SEC-HEADER>
<DOCUMENT>
<TYPE>DEF 14A
<SEQUENCE>1
<FILENAME>basproxystate.htm
<DESCRIPTION>PROXY STATEMENT
<TEXT>
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<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><B><font SIZE=2>UNITED STATES</font></B></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><B><font SIZE=2>SECURITIES AND EXCHANGE COMMISSION</font></B></p>

<p style=' margin-bottom:24pt; margin-top:0pt;text-align:center;'><b><font size=2>Washington, D.C. 20549</font></b></p>

<p style=' margin-bottom:12pt; margin-top:0pt;text-align:center;'><B><font SIZE=2>SCHEDULE 14A</font></B></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>Proxy Statement Pursuant to Section 14(a) of the</font></p>

<p style=' margin-bottom:24pt; margin-top:0pt;text-align:center;'><font size=2>Securities Exchange Act of 1934</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>Filed by the Registrant&nbsp; <img src="ballotx.jpg"> </font></p>

<p style=' margin-bottom:12pt; margin-top:0pt;text-align:justify;'><font size=2>Filed by a Party other than the Registrant </font><font face=Wingdings>o</font></p>

<p style=' margin-bottom:12pt; margin-top:0pt;text-align:justify;'><font size=2>Check the appropriate box:  </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font face=Wingdings>o</font><font size=2> Preliminary Proxy Statement</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font face=Wingdings>o</font><font size=2> Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font face=Wingdings><img src="ballotx.jpg"></font><font size=2>&nbsp;&nbsp;Definitive Proxy Statement</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font face=Wingdings>o</font><font size=2> Definitive Additional Materials</font></p>

<p style=' margin-bottom:24pt; margin-top:0pt;text-align:justify;'><font face=Wingdings>o</font><font size=2> Soliciting Material Pursuant to &sect;240.14a-12</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><b><font size=3>BIOANALYTICAL SYSTEMS, INC.</font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt; text-indent:0.5in;text-align:justify;border-bottom:solid 1.5pt;padding-bottom:1;padding-top:0;'><font size=1>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>(Name of Registrant as Specified In Its Charter)</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;border-bottom:solid 1.5pt;padding-bottom:1;padding-top:0;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:12pt; margin-top:0pt;text-align:center;'><font size=2>(Name of Person(s) Filing Proxy Statement, if other than the Registrant)</font></p>

<p style=' margin-bottom:12pt; margin-top:0pt;text-align:justify;'><font size=2>Payment of Filing Fee (Check the appropriate box):  </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2> <img src="ballotx.jpg">&nbsp;&nbsp;No fee required.</font></p>

<p style=' margin-bottom:12pt; margin-top:0pt;text-align:justify;'><font face=Wingdings>o</font><font size=2> Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.</font></p>


<table width="100%" border="0" cellspacing=0 cellpadding=0 style='border-collapse:collapse; '>
    <tr >
        <td width="35" valign=top style='border-top:none;border-left:none; border-bottom:solid gray 1.5pt;border-right:solid black 1.0pt;  padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0in;text-align: left;margin-top:0pt;margin-bottom:3.0pt'><font size=2>1)</font></p> </td>
        <td  colspan="2" valign=top style=' border-bottom:solid gray 1.5pt; padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0in;text-align: left;margin-top:0pt;margin-bottom:3.0pt'><font size=2>Title of each class of securities to which transaction applies:  </font></p> </td> </tr>
    <tr >
        <td width="35" valign=top style='border-top:none;border-left:none; border-bottom:solid gray 1.5pt;border-right:solid black 1.0pt;   padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0in;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>2)</font></p> </td>
        <td  colspan="2" valign=top style=' border-bottom:solid gray 1.5pt; padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0in;text-align: left;margin-top:0pt;margin-bottom:3.0pt'><font size=2>Aggregate number of securities to which transaction applies:  </font></p> </td> </tr>
    <tr >
        <td width="35" valign=top style='border-top:none;border-left:none; border-bottom:solid gray 1.5pt;border-right:solid black 1.0pt;   padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0in;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>3)</font></p> </td>
        <td  colspan="2" valign=top style=' border-bottom:solid gray 1.5pt; padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0in;text-align: left;margin-top:0pt;margin-bottom:3.0pt'><font size=2>Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):  </font></p> </td> </tr>
    <tr >
        <td width="35" valign=top style='border-top:none;border-left:none; border-bottom:solid gray 1.5pt;border-right:solid black 1.0pt;   padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0in;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>4)</font></p> </td>
        <td  colspan="2" valign=top style=' border-bottom:solid gray 1.5pt; padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0in;text-align: left;margin-top:0pt;margin-bottom:3.0pt'><font size=2>Proposed maximum aggregate value of transaction:  </font></p> </td> </tr>
    <tr >
        <td width="35" valign=top style='border-top:none;border-left:none; border-bottom:solid gray 1.5pt;border-right:solid black 1.0pt;   padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0in;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>5)</font></p> </td>
        <td  colspan="2" valign=top style=' border-bottom:solid gray 1.5pt; padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0in;text-align: left;margin-top:0pt;margin-bottom:3.0pt'><font size=2>Total fee paid:  </font></p> </td> </tr>
    <tr >
        <td width="35" valign=top style='border-top:none;border-left:none; border-bottom:solid gray 1.5pt;border-right:solid black 1.0pt;   padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0in;text-align:justify;margin-top:0pt;margin-bottom:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="34" valign=top style='border-top:none;border-left: none;border-bottom:solid gray 1.5pt;border-right:solid black 1.0pt;   padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0in;text-align:left;margin-top:0pt;margin-bottom:0in'><font face=Wingdings>o</font>                                                </p> </td>
        <td width="569" valign=top style='border-bottom: solid gray 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0in;text-align: left;margin-top:0pt;margin-bottom:3.0pt'><font size=2>Fee paid previously with preliminary materials.</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style='page-break-before:always'></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>


<table width="100%" border="0" cellspacing=0 cellpadding=0 style='border-collapse:collapse; '>
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        <td width="35" valign=top style='border-top:solid gray 1.5pt; border-left:none;border-bottom:solid gray 1.5pt;border-right:solid black 1.0pt;  padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0in;text-align:justify;margin-top:0pt;margin-bottom:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="34" valign=top style='border-top:solid gray 1.5pt; border-left:none;border-bottom:solid gray 1.5pt;border-right:solid black 1.0pt;   padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0in;text-align:left;margin-top:0pt;margin-bottom:0in'><font face=Wingdings>o</font>                                                </p> </td>
        <td  colspan="2" valign=top style='border-top:solid gray 1.5pt; border-left:none;border-bottom:solid gray 1.5pt;border-right:none;padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0in;text-align: left;margin-top:0pt;margin-bottom:3.0pt'><font size=2>Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously.  Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. </font></p> </td> </tr>
    <tr >
        <td width="35" valign=top style='border-right:solid black 1.0pt;  border-bottom:solid black 1.0pt;  padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0in;text-align: left;margin-top:0pt;margin-bottom:3.0pt'><font size=2>1)</font>                                                <font size=2> </font></p> </td>
        <td  colspan="3" valign=top style='  border-bottom:solid black 1.0pt;  padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0in;text-align: left;margin-top:0pt;margin-bottom:3.0pt'><font size=2>
Amount Previously Paid:  </font></p> </td> </tr>
    <tr >
        <td width="35" valign=top style='border-top:none;border-left:none; border-bottom:solid black 1.0pt;border-right:solid black 1.0pt;  padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0in;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>2)</font>                                                </p> </td>
        <td  colspan="3" valign=top style=' border-bottom:solid black 1.0pt;  padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0in;text-align: left;margin-top:0pt;margin-bottom:3.0pt'><font size=2>Form, Schedule or Registration Statement No.:  </font></p> </td> </tr>
    <tr >
        <td width="35" valign=top style='border-top:none;border-left:none; border-bottom:solid black 1.0pt;border-right:solid black 1.0pt;   padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0in;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>3)</font>                                                </p> </td>
        <td  colspan="3" valign=top style=' border-bottom:solid black 1.0pt;   padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0in;text-align: left;margin-top:0pt;margin-bottom:3.0pt'><font size=2>Filing Party:  </font></p> </td> </tr>
    <tr >
        <td width="35" valign=top style='border-top:none;border-left:none; border-bottom:solid black 1.0pt;border-right:solid black 1.0pt;   padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0in;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>4)</font>                                                </p> </td>
        <td  colspan="3" valign=top style=' border-bottom:solid black 1.0pt;   padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0in;text-align: left;margin-top:0pt;margin-bottom:3.0pt'><font size=2>Date Filed:  </font></p> </td> </tr>
    <tr >
        <td  colspan="3" style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0in;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=1>&nbsp;</font></p>
<p style='margin-left:0pt;text-indent:0in;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>&nbsp;</font></p>
<p style='margin-left:0pt;text-indent:0in;text-align:left;margin-top:0pt;margin-bottom:0in'><font SIZE=2>SEC 1913 (02-02)</font></p> </td>
        <td width="507" style=' padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:12pt'><font size=1>&nbsp;</font></p>
<p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:12pt'><b><font size=2>Persons who are to respond to the collection of information contained in this form are not required to respond unless the form displays a currently valid OMB control number.</font></b></p> </td> </tr>
    <tr>
        <td width="35" ></td>

        <td width="34" ></td>

        <td width="62" ></td>

        <td width="507" ></td> </tr> </table>








<PAGE>


<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D"><font face="Arial" size=1>&nbsp;</font></font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D"><font face="Arial" size=1>&nbsp;</font></font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D"><font face="Arial" size=1>&nbsp;</font></font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D"><font face="Arial" size=1>&nbsp;</font></font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D"><font face="Arial" size=1>&nbsp;</font></font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D"><font face="Arial" size=1>&nbsp;</font></font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D"><font face="Arial" size=1>Shareholders of Bioanalytical Systems, Inc.:</font></font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D"><font face="Arial" size=1>&nbsp;</font></font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D"><font face="Arial" size=1>You are invited to attend the Annual Meeting of Shareholders of Bioanalytical Systems, Inc. (&#147;BASi&#148;) to be held Thursday, February 15, 2007, at 10:00 a.m. (EST) at BASi headquarters located at 2701 Kent Avenue, West Lafayette, Indiana.</font></font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D"><font face="Arial" size=1>&nbsp;</font></font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D"><font face="Arial" size=1>At the meeting, shareholders will vote on the election of five persons to the Board of Directors. Details can be found in the accompanying Notice of Annual Meeting and Proxy Statement.</font></font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D"><font face="Arial" size=1>&nbsp;</font></font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D"><font face="Arial" size=1>We hope you are able to attend the Annual Meeting personally, and we look forward to meeting with you. Whether or not you currently plan to attend, please complete, date and return the proxy card in the enclosed envelope. The vote of each shareholder is very important. You may revoke your proxy at any time before it is voted by giving written notice to the Secretary of BASi, by filing a properly executed proxy bearing a later date or by attending the Annual Meeting and voting in person.</font></font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D"><font face="Arial" size=1>&nbsp;</font></font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D"><font face="Arial" size=1>On behalf of the Board of Directors and management of BASi, I sincerely thank you for your continued support.</font></font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D"><font face="Arial" size=1>&nbsp;</font></font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font size=1>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></p>


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Sincerely,<BR>
<BR>
Bioanalytical Systems, Inc.<BR>
<BR>
<BR>
<BR>
Peter T. Kissinger, Ph.D.<BR>
Chairman and Chief Scientific Officer</FONT></TD>
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<PAGE>







<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'>
</p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D">&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D">&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:left;'><font color="#24211D">&nbsp;</font></p>

<p STYLE=' MARGIN-BOTTOM:0PT; MARGIN-TOP:0PT; TEXT-INDENT:0.25IN;TEXT-ALIGN:CENTER;'><FONT COLOR="#24211D"><B><font FACE="ARIAL" SIZE=2>BIOANALYTICAL SYSTEMS, INC.</font></B></font></p>

<p STYLE=' MARGIN-BOTTOM:0PT; MARGIN-TOP:0PT; TEXT-INDENT:0.25IN;TEXT-ALIGN:CENTER;'><FONT COLOR="#24211D"><B><font FACE="ARIAL" SIZE=2>NOTICE OF ANNUAL MEETING OF SHAREHOLDERS</font></B></font></p>

<p STYLE=' MARGIN-BOTTOM:0PT; MARGIN-TOP:0PT; TEXT-INDENT:0.25IN;TEXT-ALIGN:CENTER;'><FONT COLOR="#24211D"><B><font FACE="ARIAL" SIZE=2>TO BE HELD FEBRUARY 15, 2007</font></B></font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D">&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D">&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font FACE="ARIAL" SIZE=2>To Shareholders of Bioanalytical Systems, Inc.:</font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D">&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font FACE="ARIAL" SIZE=2>The Annual Meeting of Shareholders of Bioanalytical Systems, Inc. (&#147;BASi&#148;) will be held at the principal executive offices of BASi, at 2701 Kent Avenue, West Lafayette, Indiana 47906 on Thursday, February 15, 2007 at 10:00 a.m. (EST) for the following purposes:</font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D">&nbsp;</font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:2.0pt;margin-bottom:0pt;line-height:118.8%'><font size=1>&nbsp;</font></p> </td>
        <td width="29" nowrap valign=top style='padding:2.0pt 0in 0in 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font FACE="ARIAL" SIZE=2>(a)</font></p> </td>
        <td width="600" nowrap valign=top style='padding:2.0pt 0in 0in 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font FACE="ARIAL" SIZE=2>To elect five directors of BASi to serve for a one-year term; and</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D">&nbsp;</font></p>


<table border="0" cellspacing=0 cellpadding=0 width="459" style='border-collapse:collapse'>
    <tr >
        <td width="24" nowrap valign=top style='padding:2.0pt 0in 0in 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:2.0pt;margin-bottom:0pt;line-height:118.8%'><font size=1>&nbsp;</font></p> </td>
        <td width="29" nowrap valign=top style='padding:2.0pt 0in 0in 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font FACE="ARIAL" SIZE=2>(b)</font></p> </td>
        <td width="600" nowrap valign=top style='padding:2.0pt 0in 0in 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font FACE="ARIAL" SIZE=2>to transact such other business as may properly come before the meeting.</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D">&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font FACE="ARIAL" SIZE=2>Holders of BASi common shares of record at the close of business on December 31, 2006 are entitled to notice of, and to vote at, the Annual Meeting.</font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D">&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font size=1>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></p>


<table width="100%" border="0" cellspacing=0 cellpadding=0 style='border-collapse:collapse'>
    <tr >
        <td width="281" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:2.0pt;margin-bottom:0pt;line-height:118.8%'><font size=1>&nbsp;</font></p> </td>
        <td width="309" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2.0pt;margin-bottom:0pt;line-height:118.8%'><font FACE="ARIAL" SIZE=2>By Order of the Board of Directors,</font></p> </td> </tr>
    <tr >
        <td width="281" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:2.0pt;margin-bottom:0pt;line-height:118.8%'><font size=1>&nbsp;</font></p> </td>
        <td width="309" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:2.0pt;margin-bottom:0pt;line-height:118.8%'><font size=1>&nbsp;</font></p> </td> </tr>
    <tr >
        <td width="281" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:2.0pt;margin-bottom:0pt;line-height:118.8%'><font size=1>&nbsp;</font></p> </td>
        <td width="309" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:2.0pt;margin-bottom:0pt;line-height:118.8%'><font size=1>&nbsp;</font></p> </td> </tr>
    <tr >
        <td width="281" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:2.0pt;margin-bottom:0pt;line-height:118.8%'><font size=1>&nbsp;</font></p> </td>
        <td width="309" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:2.0pt;margin-bottom:0pt;line-height:118.8%'><font size=1>&nbsp;</font></p> </td> </tr>
    <tr >
        <td width="281" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:2.0pt;margin-bottom:0pt;line-height:118.8%'><font size=1>&nbsp;</font></p> </td>
        <td width="309" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent: 2.25pt;text-align:justify;margin-top:2.0pt;margin-bottom:0pt;line-height:118.8%'><font size=1>&nbsp;</font></p> </td> </tr>
    <tr >
        <td width="281" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:2.0pt;margin-bottom:0pt;line-height:118.8%'><font size=1>&nbsp;</font></p> </td>
        <td width="309" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2.0pt;margin-bottom:0pt;line-height:118.8%'><font FACE="ARIAL" SIZE=2>Candice B. Kissinger</font></p> </td> </tr>
    <tr >
        <td width="281" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:2.0pt;margin-bottom:0pt;line-height:118.8%'><font size=1>&nbsp;</font></p> </td>
        <td width="309" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2.0pt;margin-bottom:0pt;line-height:118.8%'><font FACE="ARIAL" SIZE=2>Secretary</font></p> </td> </tr>
    <tr >
        <td width="281" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:2.0pt;margin-bottom:0pt;line-height:118.8%'><font size=1>&nbsp;</font></p> </td>
        <td width="309" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:2.0pt;margin-bottom:0pt;line-height:118.8%'><font size=1>&nbsp;</font></p> </td> </tr>
    <tr >
        <td width="281" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:2.0pt;margin-bottom:0pt;line-height:118.8%'><font size=1>&nbsp;</font></p> </td>
        <td width="309" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2.0pt;margin-bottom:0pt;line-height:118.8%'><font FACE="ARIAL" SIZE=2>January 17, 2007</font></p> </td> </tr>
    <tr >
        <td width="281" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:2.0pt;margin-bottom:0pt;line-height:118.8%'><font size=1>&nbsp;</font></p> </td>
        <td width="309" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:2.0pt;margin-bottom:0pt;line-height:118.8%'><font FACE="ARIAL" SIZE=2>West Lafayette, Indiana</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D">&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D">&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D">&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D">&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font FACE="ARIAL" SIZE=2>
YOUR VOTE IS IMPORTANT. IF YOU DO NOT EXPECT TO ATTEND THE ANNUAL MEETING, OR IF
YOU DO PLAN TO ATTEND BUT WISH TO VOTE BY PROXY, PLEASE DATE, SIGN AND PROMPTLY
MAIL THE ENCLOSED PROXY. A RETURN ENVELOPE IS PROVIDED FOR THIS
PURPOSE.</font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D">&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D">&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style='page-break-before:always'></p>
<pAGE>












<p STYLE=' MARGIN-BOTTOM:0PT; MARGIN-TOP:0PT; TEXT-INDENT:0.25IN;TEXT-ALIGN:CENTER;'><FONT COLOR="#24211D"><B><font FACE="ARIAL" SIZE=2>BIOANALYTICAL SYSTEMS, INC., PROXY STATEMENT</font></B></font></p>

<p STYLE=' MARGIN-BOTTOM:0PT; MARGIN-TOP:0PT; TEXT-INDENT:0.25IN;TEXT-ALIGN:CENTER;'><FONT COLOR="#24211D"><B><font FACE="ARIAL" SIZE=2>ANNUAL MEETING OF SHAREHOLDERS</font></B></font></p>

<p STYLE=' MARGIN-BOTTOM:0PT; MARGIN-TOP:0PT; TEXT-INDENT:0.25IN;TEXT-ALIGN:CENTER;'><FONT COLOR="#24211D"><B><font FACE="ARIAL" SIZE=2>TO BE HELD FEBRUARY 15, 2007</font></B></font></p>
<BR>

<p style=' margin-bottom:0pt; margin-top:3pt;text-align:left;'><font color="#24211D"><b><font face="Arial" size=2>General Information</font></b></font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font face="Arial" size=2>This proxy statement is furnished in connection with the solicitation by the Board of Directors of BASi of proxies to be voted at the Annual Meeting of Shareholders to be held at 10:00 a.m. (EST) on Thursday, February 15, 2007, and at any adjournment thereof. The meeting will be held at the principal executive offices of BASi, 2701 Kent Avenue, West Lafayette, Indiana 47906. This proxy statement and the accompanying form of proxy were first mailed to shareholders on or about January 17, 2007.</font></p>

<p style=' margin-bottom:0pt; margin-top:3pt;text-align:left;'><font color="#24211D"><font face="Arial" size=2>&nbsp;</font></font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font face="Arial" size=2>A shareholder signing and returning the enclosed proxy may revoke it at any time before it is exercised by delivering written notice to the Secretary of BASi, by filing a properly executed proxy bearing a later date or by attending the Annual Meeting and voting in person. The signing of a proxy does not preclude a shareholder from attending the Annual Meeting in person. All proxies returned prior to the Annual Meeting, and not revoked, will be voted in accordance with the instructions contained therein. Any proxy not specifying to the contrary will be voted FOR the election of each of the nominees for director named below. Abstentions and broker non-votes are not counted for purposes of determining whether a proposal has been approved, but will be counted for purposes of determining whether a quorum is present.</font></p>

<p style=' margin-bottom:0pt; margin-top:3pt;text-align:left;'><font color="#24211D"><font face="Arial" size=2>&nbsp;</font></font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font face="Arial" size=2>As of the close of business on December 31, 2006, the record date for the Annual Meeting, there were outstanding and entitled to vote 4,892,127 common shares of BASi. Each outstanding common share is entitled to one vote. BASi has no other voting securities outstanding. Shareholders do not have cumulative voting rights.</font></p>

<p style=' margin-bottom:0pt; margin-top:3pt;text-align:left;'><font color="#24211D"><font face="Arial" size=2>&nbsp;</font></font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font face="Arial" size=2>A quorum will be present if a majority of the outstanding common shares are present, in person or by proxy, at the Annual Meeting. If a quorum is present, the nominees for director will be elected by a plurality of the votes cast.</font></p>

<p style=' margin-bottom:0pt; margin-top:3pt;text-align:left;'><font color="#24211D"><font face="Arial" size=2>&nbsp;</font></font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font face="Arial" size=2>A copy of the BASi Annual Report and Form 10-K, including audited financial statements and a description of operations for the fiscal year ended September 30, 2006, accompanies this proxy statement. The financial statements contained in the Annual Report and Form 10-K are not incorporated by reference in this proxy statement. The solicitation of proxies is being made by BASi, and all expenses in connection with the solicitation of proxies will be borne by BASi. BASi expects to solicit proxies primarily by mail, but directors, officers and other employees of BASi may also solicit proxies in person or by telephone.</font></p>

<p style=' margin-bottom:0pt; margin-top:3pt;text-align:left;'><font color="#24211D"><font face="Arial" size=2>&nbsp;</font></font></p>

<p style=' margin-bottom:0pt; margin-top:3pt;text-align:left;'><font color="#24211D"><b><font face="Arial" size=2>Proposals for 2008 Annual Meeting</font></b></font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font face="Arial" size=2>Shareholder proposals to be considered for presentation and inclusion in the proxy statement for the 2008 Annual Meeting of Shareholders must be submitted in writing and received by BASi on or before September 28, 2007. If notice of any other shareholder proposal intended to be presented at the 2008 Annual Meeting of Shareholders is not received by BASi on or before December 14, 2007, the proxy solicited by the Board of Directors of BASi for use in connection with that meeting may confer authority on the proxies to vote in their discretion on such proposal, without any discussion in the BASi proxy statement for that meeting of either the proposal or how such proxies intend to exercise their voting discretion. The mailing address of the principal offices of BASi is 2701 Kent Avenue, West Lafayette, Indiana 47906.</font></p>

<p style=' margin-bottom:0pt; margin-top:3pt;text-align:left;'><font color="#24211D"><font face="Arial" size=2>&nbsp;</font></font></p>

<p style=' margin-bottom:0pt; margin-top:3pt;text-align:left;'><font face="Arial" size=2><b>Beneficial Ownership of Common Shares</b></font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font face="Arial" size=2>
The following table sets forth certain data with respect to those persons known
by BASi to be the beneficial owners of five percent or more of the outstanding
common shares of BASi as of December 31, 2006, and also sets forth such data
with respect to each director of BASi, each officer listed in the Executive
Compensation table (beginning on page 6 of this proxy statement), and all
directors and executive officers of BASi as a group. Except as otherwise
indicated in the notes to the table, each beneficial owner possesses sole voting
and investment power with respect to the common shares indicated.</font></p>


<BR>
<BR>
<P ALIGN=left><FONT FACE="Arial" SIZE=1>
1</FONT></P>


<pAGE>















<p style=' margin-bottom:0pt; margin-top:3pt;text-align:left;'>
<font color="#24211D"><b><font face="Arial" size=2>Beneficial Ownership of Common Shares</font></b></font></p>

<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 ALIGN=Center WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN=2 ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Name<sup>(1)</sup></FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
<TH COLSPAN=1><FONT FACE="Arial" SIZE=2></FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2><FONT FACE="Arial" SIZE=2>Shares<BR>Owned</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
<TH COLSPAN=1><FONT FACE="Arial" SIZE=2></FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2><FONT FACE="Arial" SIZE=2>Shares<BR>Owned<BR>Jointly</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
<TH COLSPAN=1><FONT FACE="Arial" SIZE=2></FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2><FONT FACE="Arial" SIZE=2>Shares/<BR>Options<BR>Owned<BR>Beneficially</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
<TH COLSPAN=1><FONT FACE="Arial" SIZE=2></FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2><FONT FACE="Arial" SIZE=2>Options<BR>Exercisable<BR>Within 60 Days of<BR>December 21, 2006</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
<TH COLSPAN=1><FONT FACE="Arial" SIZE=2></FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2><FONT FACE="Arial" SIZE=2>Total</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
<TH COLSPAN=2><FONT FACE="Arial" SIZE=2></FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2><FONT FACE="Arial" SIZE=2>%</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH></TR>
<TR VALIGN=Bottom>

<TD WIDTH=28% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Peter T. Kissinger<sup>(2)</sup></FONT></TD>
<TD WIDTH=1% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=2% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>

<TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=8% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>430,947</FONT></TD>
<TD WIDTH=3% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>

<TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=8% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>595,910</FONT></TD>
<TD WIDTH=3% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>

<TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=8% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>268,310</FONT></TD>
<TD WIDTH=3% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>

<TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=7% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
<TD WIDTH=4% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>

<TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=6% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>1,295,167</FONT></TD>
<TD WIDTH=3% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>

<TD WIDTH=4% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>25</FONT></TD>
<TD WIDTH=1% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>.2%</FONT></TD></TR>

<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Candice B. Kissinger<sup>(2)</sup></FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>250,956</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>595,910</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>432,301</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>16,000</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>1,295,167</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>25</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>.2%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>William B. Baitinger<sup>(3)</sup></FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>146,512</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>10,000</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>156,412</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>3</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>.1%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>David W. Crabb</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Ronald E. Shoup<sup>(3)</sup></FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>451</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>88,517</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>27,000</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>115,968</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>2</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>.3%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Leslie B. Daniels<sup>(4)</sup></FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>38,042</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>31,175</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>69,217</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>1</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>.3%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Michael R. Cox</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>37,500</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>37,500</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>0</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>.7%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Edward M. Chait</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>37,500</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>37,500</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>0</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>.7%</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Richard M. Shepperd</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>750</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>750</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2></FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
<TR>
     <TD COLSPAN=3></TD>
     <TD COLSPAN=3></TD>
     <TD COLSPAN=3></TD>
     <TD COLSPAN=3></TD>
     <TD COLSPAN=3></TD>
     <TD COLSPAN=3></TD>
     <TD COLSPAN=3></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>10 Executive Officers and</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Directors as a Group</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>723,810</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>847,528</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>31,175</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>149,250</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>1,734,517</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>33</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>.8%</FONT></TD></TR>
</TABLE>
<BR>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=3%><FONT FACE="Arial" SIZE=1>
(1)</FONT></TD>
<TD WIDTH=97%><FONT FACE="Arial" SIZE=1>
All addresses are in care of BASi at 2701 Kent Avenue, West Lafayette, Indiana 47906.</FONT></TD>
</TR>
</TABLE>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=3%><FONT FACE="Arial" SIZE=1>
(2)</FONT></TD>
<TD WIDTH=97%><FONT FACE="Arial" SIZE=1>
Shares beneficially and jointly owned by Dr. Kissinger and his wife Mrs.
Kissinger. Mrs. Kissinger is custodian for 1,354 shares split equally between
their two sons, included in Beneficial Ownership.</FONT></TD>
</TR>
</TABLE>


<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=3%><FONT FACE="Arial" SIZE=1>
(3)</FONT></TD>
<TD WIDTH=97%><FONT FACE="Arial" SIZE=1>
Shares owned jointly by Mr. Baitinger&#146;s and Dr. Shoup&#146;s wives, respectively.</FONT></TD>
</TR>
</TABLE>


<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=3%><FONT FACE="Arial" SIZE=1>
(4)</FONT></TD>
<TD WIDTH=97%><FONT FACE="Arial" SIZE=1>
Shares beneficially owned may be acquired upon conversion of a $498,809 convertible
subordinated debenture at $16.00 per share.</FONT></TD>
</TR>
</TABLE>
<BR>



<p style=' margin-bottom:0pt; margin-top:2pt;text-align:left;'><font color="#24211D">&nbsp;</font></p>

<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2><B>1.&nbsp;&nbsp;ELECTION OF DIRECTORS</B></FONT></P>

<p style=' margin-bottom:0pt; margin-top:3pt;text-align:left;'><font color="#24211D"><b><font face="Arial" size=2>Nominees</font></b></font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><FONT FACE="Arial" SIZE=2>
The Bylaws of BASi provide for no fewer than seven and no more than nine
directors, each of whom is elected for a one-year term. The terms of all
incumbent directors will expire at the Annual Meeting. The Nominating Committee
of the Board of Directors has nominated the following current directors for
re-election at the Annual Meeting: Peter T. Kissinger, Candice B. Kissinger,
William E. Baitinger, David W. Crabb and Leslie B. Daniels (collectively, the
&#147;Nominated Directors&#148;). The Board of Directors has determined that
each of the Nominated Directors, other than Peter T. Kissinger and Candice B.
Kissinger, is an &#147;independent director&#148; as defined in the applicable
rules of the NASDAQ Stock Market. There are two vacancies on the board at this
time, and the Nominating Committee is searching for qualified individuals to
fill the vacancies. The Board of Directors expects to fill these vacancies in
due course.</font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D">&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><FONT FACE="Arial" SIZE=2>
The Board of Directors recommends that shareholders vote FOR the election of all
of the Nominated Directors. Unless authority to vote for any Nominated Director
is withheld, the accompanying proxy will be voted FOR the election of all the
Nominated Directors. However, the persons designated as proxies reserve the
right to cast votes for another person designated by the Board of Directors in
the event any Nominated Director becomes unable to serve or for good cause will
not serve. Proxies will not be voted for more than five nominees. If a quorum is
present, those nominees receiving a plurality of the votes cast will be elected
to the Board of Directors. </font></p>



<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2>
The following table shows certain information about the Nominated Directors:</FONT></P>



<TABLE CELLPADDING=0 CELLSPACING=0 ALIGN=Center WIDTH=80%>
<TR VALIGN=Bottom>
     <TH align=left COLSPAN=2><FONT FACE="Arial" SIZE=2>Name</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
<TH COLSPAN=1><FONT FACE="Arial" SIZE=2></FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2><FONT FACE="Arial" SIZE=2>Age</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
<TH COLSPAN=1><FONT FACE="Arial" SIZE=2></FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2><FONT FACE="Arial" SIZE=2>Position</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
<TH COLSPAN=1><FONT FACE="Arial" SIZE=2></FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2><FONT FACE="Arial" SIZE=2>Served as<BR>
Director Since</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=21% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Peter T. Kissinger, Ph.D</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=2% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>62</FONT></TD>
        <TD WIDTH=3% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=46% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Chairman of the Board; Chief Scientific Officer</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=2% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=8% ALIGN=center><FONT FACE="Arial" SIZE=2>1974</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Candice B. Kissinger</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>55</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Senior Vice President; Director of Research; Director</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=center><FONT FACE="Arial" SIZE=2>1978</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>William E. Baitinger</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>72</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Director</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=center><FONT FACE="Arial" SIZE=2>1979</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>David W. Crabb</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>53</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Director</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=center><FONT FACE="Arial" SIZE=2>2004</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Leslie B. Daniels</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>59</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Director</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=center><FONT FACE="Arial" SIZE=2>2003</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
</TABLE>



<BR>
<BR>
<P ALIGN=left><FONT FACE="Arial" SIZE=1>
2</FONT></P>


<pAGE>











<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.25in; text-indent:-0.25in;text-align:left;'>
<font color="#24211D"><b><font face="Arial" size=2>Business Experience of Nominated Directors</font></b></font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font face="Arial" size=2><B>Peter T. Kissinger, Ph.D.</B> </font><font face="Arial" size=2>founded BASi in 1974 and has served as its Chairman, President and Chief Executive Officer from that time until September, 2006.  In September, 2006, Dr. Kissinger resigned the position of President and Chief Executive Officer, and assumed the role of Chief Scientific Officer. He is also a part-time Professor of Chemistry at Purdue University, where he has been teaching since 1975. Dr. Kissinger has a Bachelor of Science degree in Analytical Chemistry from Union College and a Ph.D. in Analytical Chemistry from the University of North Carolina.</font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D">&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font face="Arial" size=2><B>Candice B. Kissinger</B></font><font face="Arial" size=2> has been Senior Vice President of BASi since January 2000 and currently also serves as Director of Research. She has obtained for BASi U.S. and international patents for BASi products including Raturn, Culex, linear microdialysis probe, Empis automated drug infusion system and Chads for Vials with additional patents pending. Ms. Kissinger has a Bachelor of Science degree in Microbiology from Ohio Wesleyan University and a Master of Science degree in Food Science from the University of Massachusetts. She has served as a director and Secretary of BASi since 1978.</font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D">&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font face="Arial" size=2><B>William E. Baitinger</B></font><font face="Arial" size=2> has served as a director of BASi since 1979. Mr. Baitinger was Director of Technology Transfer for the Purdue Research Foundation from 1988 until 2000. In this capacity he was responsible for all licensing and commercialization activities from Purdue University. He currently serves as Special Assistant to the Vice President for Research at Purdue University. Mr. Baitinger has a Bachelor of Science degree in Chemistry and Physics from Marietta College and a Master of Science degree in Chemistry from Purdue University.</font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D">&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font face="Arial" size=2><B>David W. Crabb, M.D.</B></font><font face="Arial" size=2> has served as a director of BASi since February 2004. He has been Chairman of the Indiana University Department of Medicine since 2001. Previously he had served as Chief Resident of Internal Medicine and on the Medicine and Biochemistry faculty of Indiana University. He was appointed Vice Chairman for Research for the department and later Assistant Dean for Research. Dr. Crabb serves on several editorial boards. He is Director of the Indiana Alcohol Research Center funded by NIAAA. He was a recipient of an NIH Merit Award and numerous other research and teaching awards.</font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D"><font face="Arial" size=2>&nbsp;</font></font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font face="Arial" size=2><B>Leslie B. Daniels</B></font><font face="Arial" size=2> joined the BASi Board of Directors in July 2003. Mr. Daniels is a founding partner of CAI, a private equity fund in New York City. He previously was President of Burdge, Daniels &amp; Co., Inc., a principal in venture capital and buyout investments as well as trading of private placement securities, and before that, a Senior Vice President of Blyth, Eastman, Dillon &amp; Co. where he had responsibility for the corporate fixed income sales and trading departments. Mr. Daniels is a former Director of Aster-Cephac SA, IVAX Corporation, MIM Corporation, Mylan Laboratories, Inc., NBS Technologies Inc. and MIST Inc. He was also Chairman of Zenith Laboratories, Inc. and currently serves as Chairman of Turbo Combustor Technology Inc. and as a Director of SafeGuard Health Enterprises, Inc.</font></p>


<BR>
<BR>
<P ALIGN=left><FONT FACE="Arial" SIZE=1>
3</FONT></P>




<pAGE>











<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'>
<font color="#24211D"><b><font face="Arial" size=2>Family Relationships</font></b></font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font face="Arial" size=2>Peter T. Kissinger and Candice B. Kissinger are husband and wife. There is no other family relationship among the directors and executive officers of BASi.</font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D">&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:3pt;text-align:left;'><font face="Arial" size=2><b>Compensation of Directors</b></font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font face="Arial" size=2>Directors who are not employees of BASi receive $2,000 for each Board meeting attended, plus out-of-pocket expenses incurred in connection with attendance at such meetings. Directors of BASi or an affiliate of BASi who are not employed by BASi or any affiliate may also participate in the BASi 1997 Outside Director Stock Option Plan, as may be approved from time to time by the Compensation Committee. Directors who are employees of BASi do not receive any additional compensation for their services as directors.</font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D">&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:3pt;text-align:left;'><font color="#24211D"><b><font face="Arial" size=2>Committees and Meetings of the Board of Directors</font></b></font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font face="Arial" size=2>The Board of Directors has established Compensation and Incentive Stock Option, Audit, and Nominating Committees. Scheduled meetings are supplemented by frequent informal exchange of information and actions taken by unanimous votes without meetings.</font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D">&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font face="Arial" size=2>No member of the Board of Directors attended fewer than 75% of the meetings of the Board of Directors and meetings of any committee of the Board of Directors of which he or she was a member. Three out of five members of the Board of Directors attended the 2006 Annual Meeting of shareholders. All of the members of the Board of Directors are encouraged, but not required, to attend BASi&#146;s annual meetings. The following chart shows the number of meetings of each of the committees of the Board of Directors and meetings of the Board of Directors at which a quorum was present:</font></p>

<p style=' margin-bottom:0pt; margin-top:2pt;text-align:justify;'><font color="#24211D">&nbsp;</font></p>



<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 ALIGN=Center WIDTH=70%>
<TR VALIGN=Bottom>
     <TH ALIGN=LEFT COLSPAN=3><FONT FACE="Arial" SIZE=2>Committee</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH ALIGN=LEFT COLSPAN=3><FONT FACE="Arial" SIZE=2>Members</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=3><FONT FACE="Arial" SIZE=2>Meetings<BR>
in 2006</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH></TR>

<TR VALIGN=BOTTOM><TH>&nbsp;</TH></TR>

<TR VALIGN=Bottom>
     <TD WIDTH=48% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Compensation and Incentive Stock Option</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=4% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=38% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>William E. Baitinger</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=4% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>2</FONT></TD>
        <TD WIDTH=2% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2></FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Leslie B. Daniels</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2></FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>David W. Crabb</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
<TR>
     <TD COLSPAN=3></TD>
     <TD COLSPAN=3></TD>
     <TD COLSPAN=3></TD></TR>

<TR VALIGN=BOTTOM><TH>&nbsp;</TH></TR>

<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Audit</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>William E. Baitinger</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>5</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2></FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Leslie B. Daniels</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2></FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>David W. Crabb</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
<TR>
     <TD COLSPAN=3></TD>
     <TD COLSPAN=3></TD>
     <TD COLSPAN=3></TD></TR>

<TR VALIGN=BOTTOM><TH>&nbsp;</TH></TR>

<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Nominating</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>William E. Baitinger</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>0</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2></FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>David W. Crabb</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2></FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Leslie B. Daniels</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>

<TR VALIGN=BOTTOM><TH>&nbsp;</TH></TR>

<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Board of Directors</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2></FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>5</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
</TABLE>



<BR>
<BR>
<P ALIGN=left><FONT FACE="Arial" SIZE=1>
4</FONT></P>




<pAGE>








<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2>
The Compensation and Incentive Stock Option Committee makes recommendations to
the Board of Directors with respect to:</FONT></P>


<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#149; compensation arrangements for the executive officers of BASi,<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#149; policies relating to salaries and job descriptions,<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#149; insurance programs,<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#149; benefit programs, including retirement plans,<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#149; administration of the 1990 and 1997 Employee Incentive Stock Option Plans, and<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#149; the 1997 Outside Director Stock Option Plan.</FONT></P>


<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2>The Audit Committee is responsible for:<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#149; reviewing with the auditors the scope of the audit work performed,<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#149; establishing audit practices,<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#149; overseeing internal accounting controls,<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#149; reviewing financial reporting, and<BR>
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#149; accounting personnel staffing.&nbsp;</FONT></P>

<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2>The Board of Directors has adopted a written charter for the Audit Committee, a copy of
which is included as attachment A to BASi&#146;s Proxy Statement for fiscal 2005. Audit
Committee members are not employees of BASi and, in the opinion of the Board of
Directors, are &#147;independent&#148; (as defined by Rule 4200(a) (15) of the NASD
listing standards). The Board of Directors has determined that Leslie B. Daniels is an
&#147;audit committee financial expert&#148; (as defined by Item 401(h) of Regulation
S-K) and is &#147;independent&#148; (as defined by Item 7(d) (3) (iv) of Schedule 14A). </FONT></P>


<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2>The <B>Nominating Committee</B> is responsible for receiving and reviewing recommendations for
nominations to the Board of Directors and recommending individuals as nominees for
election to the Board of Directors. Nominating Committee members are not employees of
BASi and, in the opinion of the Board of Directors, are &#147;independent&#148; (as
defined by rule 4200 (a) (15) of the NASD listing standards). The Board of Directors has
not adopted a written charter for the Nominating Committee.</FONT></P>


<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2>Shareholders of BASi may nominate directors by providing timely notice thereof in proper
written form to the Secretary of BASi. To be timely, a shareholder&#146;s notice to the
Secretary must be delivered to or mailed and received at the principal executive offices
of BASi (a) in the case of an annual meeting, not less than ninety days nor more than one
hundred twenty days prior to the anniversary date of the immediately preceding annual
meeting; and (b) in the case of a special meeting of shareholders called for the purpose
of electing directors, not later than the close of business on the tenth day following
the day on which notice of the date of the special meeting was mailed or public
disclosure of the date of the special meeting was made, whichever first occurs.</FONT></P>



<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2>To be in proper written form, a shareholder&#146;s notice to the Secretary must set forth
(a) as to each person whom the shareholder proposes to nominate for election as a
director (i) the name, age, business address and residence address of the person, (ii)
the principal occupation or employment of the person, (iii) the class or series and
number of shares of capital stock of BASi which are owned beneficially or of record by
the person, and (iv) any other information relating to the person that would be required
to be disclosed in a proxy statement or other filings required to be made in connection
with solicitations of proxies for election of directors pursuant to Section 14 of the
Securities Exchange Act of 1934, as amended (the &#148;Exchange Act&#148;), and the rules
and regulations promulgated thereunder; and (b) as to the shareholder giving the notice
(i) the name and record address of such shareholder, (ii) the class or series and number
of shares of capital stock of BASi which are owned beneficially or of record by such
shareholder, (iii) a description of all arrangements or understandings between such
shareholder and each proposed nominee and any other person or persons (including their
names) pursuant to which the nomination(s) are to be made by such shareholder, (iv) a
representation that such shareholder intends to appear in person or by proxy at the
meeting to nominate the persons named in its notice, and (v) any other information
relating to such shareholder that would be required to be disclosed in a proxy statement
or other filings required to be made in connection with solicitations of proxies for
election of directors pursuant to Section 14 of the Exchange Act and the rules and
regulations promulgated thereunder. Such notice must be accompanied by a written consent
of each proposed nominee to being named as a nominee and to serve as a director if
elected.</FONT></P>




<BR>
<BR>
<P ALIGN=left><FONT FACE="Arial" SIZE=1>
5</FONT></P>




<pAGE>










<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2>
The chair of the Nominating Committee or his or her designee shall have the
authority to determine whether a nomination is properly made in accordance with
the foregoing procedures. If the chair of the Nominating Committee or his or her
designee determines that a nomination was not made in accordance with the
foregoing procedures, the chairman of the meeting shall declare to the meeting
that the nomination was defective and such defective nomination shall be
disregarded.</FONT></P>



<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2>
There is no fixed process for identifying and evaluating potential candidates to
be nominees for directors, and there is no fixed set of qualifications that must
be satisfied before a candidate will be considered. Rather, the Nominating
Committee has the flexibility to consider such factors as it deems appropriate.
These factors may include education, diversity, and experience with business and
other organizations comparable with BASi, the interplay of the candidate&#146;s
experience with that of other members of the Board of Directors, and the extent
to which the candidate would be a desirable addition to the Board of Directors
and to any of the committees of the Board of Directors. The Nominating Committee
will evaluate nominees for directors submitted by shareholders in the same
manner in which it evaluates other director nominees. No shareholder has
properly nominated anyone for election as a director at the Annual
Meeting.</FONT></P>



<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2><B>Executive Compensation</B><BR>
The following table sets forth information with respect
to the aggregate compensation paid during each of the last three fiscal years to
BASi&#146;s President and Chief Executive Officer and each of the other
executive officers of BASi whose total compensation exceeded $100,000 during
fiscal 2006 (the &#147;Named Executive Officers&#148;).</FONT></P>

<P ALIGN=CENTER><FONT FACE="Arial" SIZE=2><B>SUMMARY COMPENSATION TABLE</B></FONT></P>

<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 ALIGN=Center WIDTH=100%>
<TR VALIGN=Bottom>
     <TH align=left COLSPAN=2><FONT FACE="Arial" SIZE=2> </FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2><FONT FACE="Arial" SIZE=2>Fiscal Year</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
<TH COLSPAN=2><FONT FACE="Arial" SIZE=2></FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2><FONT FACE="Arial" SIZE=2>Salary</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
<TH COLSPAN=1><FONT FACE="Arial" SIZE=2></FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2><FONT FACE="Arial" SIZE=2>Bonus</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
<TH COLSPAN=1><FONT FACE="Arial" SIZE=2></FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2><FONT FACE="Arial" SIZE=2>All Other<BR>Compensation</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
<TH COLSPAN=1><FONT FACE="Arial" SIZE=2></FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2><FONT FACE="Arial" SIZE=2>Options<BR>Granted</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=41% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Peter T. Kissinger, Ph.D</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=2% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=4% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>2006</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=2% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD WIDTH=7% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2> 108,284</FONT></TD>
        <TD WIDTH=6% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=7% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD WIDTH=3% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD WIDTH=7% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>  27,801</FONT></TD>
        <TD WIDTH=6% ALIGN=LEFT><FONT FACE="Arial" SIZE=2><sup>(1)</sup></FONT></TD>
     <TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=7% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD WIDTH=2% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Chairman of the Board,</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>2005</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2> 107,674</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>  27,756</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2><sup>(1)</sup></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Chief Scientific Officer</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>2004</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>  24,000</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>  27,380</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2><sup>(1)</sup></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>

<TR VALIGN=BOTTOM><TH>&nbsp;</TH></TR>


<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Richard M. Shepperd<sup>(4)</sup></FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>2006</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>President and Chief</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Executive Officer</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>

<TR VALIGN=BOTTOM><TH>&nbsp;</TH></TR>

<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Michael R. Cox</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>2006</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2> 153,000</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>   4,182</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2><sup>(3)</sup></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Vice President, Finance and</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>2005</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2> 152,500</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>   4,279</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2><sup>(3)</sup></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Chief Financial Officer</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>2004</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>  76,728</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>50,000</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>

<TR VALIGN=BOTTOM><TH>&nbsp;</TH></TR>

<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Ronald E. Shoup, Ph.D</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>2006</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2> 132,572</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>  12,896</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>   9,124</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Chief Operating Officer, BASi</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>2005</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2> 128,133</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>   7,946</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2><sup>(3)</sup></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Contract Research Services</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>2004</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2> 124,000</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>   7,594</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2><sup>(3)</sup></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>40,000</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>

<TR VALIGN=BOTTOM><TH>&nbsp;</TH></TR>

<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Edward M. Chait, Ph.D</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>2006</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2> 150,461</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Executive Vice President</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>2005</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>  25,000</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2><sup>(2)</sup></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>50,000</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>

<TR VALIGN=BOTTOM><TH>&nbsp;</TH></TR>

<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Candice B. Kissinger</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>2006</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2> 107,697</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>  10,588</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>  28,435</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2><sup>(1)</sup></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Senior Vice President, Research;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>2005</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2> 105,193</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>  27,597</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2><sup>(1)</sup></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Secretary and Director</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>2004</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2> 101,800</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>  22,401</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2><sup>(1)</sup></FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>30,000</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
</TABLE>
<BR>


<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=3%><FONT FACE="Arial" SIZE=1>
(1)</FONT></TD>
<TD WIDTH=97%><FONT FACE="Arial" SIZE=1>
Includes premiums paid on a life insurance policy on the life of Dr.
Kissinger and Mrs. Kissinger, the beneficiary of which is a trust established
for their benefit, in the amount of $20,865 in each of 2006, 2005 and 2004 and
contributions to BASi&#146;s 401(k) plan on Dr. Kissinger and Mrs. Kissinger,
respectively.</FONT></TD>
</TR>
</TABLE>


<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=3%><FONT FACE="Arial" SIZE=1>
(2)</FONT></TD>
<TD WIDTH=97%><FONT FACE="Arial" SIZE=1>
Compensation is from August 1, 2005, the date Dr. Chait&#146;s employment
with BASi was initiated.</FONT></TD>
</TR>
</TABLE>


<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=3%><FONT FACE="Arial" SIZE=1>
(3)</FONT></TD>
<TD WIDTH=97%><FONT FACE="Arial" SIZE=1>
All other compensation contributions for Mr. Cox, Dr. Shoup and Dr. Silvon
were to BASi&#146;s 401(k) plan on their behalf, respectively.</FONT></TD>
</TR>
</TABLE>



<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=3%><FONT FACE="Arial" SIZE=1>
(4)</FONT></TD>
<TD WIDTH=97%><FONT FACE="Arial" SIZE=1>
Joined Company in October, 2006.</FONT></TD>
</TR>
</TABLE>




<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=1>
There were no option grants to the Named Executive Officers in the fiscal year
ended September 30, 2006.</FONT></P>






<BR>
<BR>
<P ALIGN=left><FONT FACE="Arial" SIZE=1>
6</FONT></P>




<pAGE>











<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2>
<B>Aggregated Option Exercises In Last Fiscal Year and Fiscal Year-End Option
Values</b><BR>
The following table sets forth certain information concerning exercisable and
unexercisable options held by the Named Executive Officers at September 30, 2006:
</FONT></P>

<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 ALIGN=Center WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN=9><FONT FACE="Arial" SIZE=2></FONT></TH>
     <TH COLSPAN=5><FONT FACE="Arial" SIZE=2>Number of Securities Underlying<BR>
Unexercised Options at<BR>
September 30, 2006</FONT><HR WIDTH=95% SIZE=1 COLOR=BLACK NOSHADE></TH>

<TH COLSPAN=1><FONT FACE="Arial" SIZE=2></FONT></TH>


     <TH COLSPAN=5><FONT FACE="Arial" SIZE=2>Value of Unexercised<BR>
In-the-Money Options at<BR>
September 30, 2006<sup>(1)</sup></FONT><HR WIDTH=95% SIZE=1 COLOR=BLACK NOSHADE></TH></TR>
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Arial" SIZE=2></FONT></TH>
     <TH COLSPAN=3><FONT FACE="Arial" SIZE=2>Shares<BR>
Acquired on<BR>
Exercise</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=3><FONT FACE="Arial" SIZE=2>Value<BR>
Realized ($)</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=3><FONT FACE="Arial" SIZE=2>Exercisable</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=3><FONT FACE="Arial" SIZE=2>Unexercisable</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=3><FONT FACE="Arial" SIZE=2>Exercisable</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=3><FONT FACE="Arial" SIZE=2>Unexercisable</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH></TR>

<TR VALIGN=BOTTOM><TH>&nbsp;</TH></TR>


<TR VALIGN=Bottom>
<TD WIDTH=20% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Peter T. Kissinger</FONT></TD>
<TD WIDTH=1% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=3% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>

<TD WIDTH=2% ALIGN=left><FONT FACE="Arial" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#151;</FONT></TD>
<TD WIDTH=1% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=3% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>

<TD WIDTH=2% ALIGN=left><FONT FACE="Arial" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#151;</FONT></TD>
<TD WIDTH=1% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=3% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>

<TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=9% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
<TD WIDTH=4% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>

<TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=9% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
<TD WIDTH=4% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>

<TD WIDTH=4% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=4% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
<TD WIDTH=4% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>

<TD WIDTH=3% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=3% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
<TD WIDTH=2% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>

<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Ronald E. Shoup</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#151;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#151;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>27,000</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>20,000</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2> 18,030</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2> 15,000</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Edward M. Chait</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#151;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#151;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>37,500</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>12,500</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Michael R. Cox</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#151;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#151;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>37,500</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>12,500</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2> 25,500</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>  8,500</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Candice B. Kissinger</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#151;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#151;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>11,000</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>20,000</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>  5,510</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>  4,500</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
</TABLE>
<BR>






<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=3%><FONT FACE="Arial" SIZE=1>
(1)</FONT></TD>
<TD WIDTH=97%><FONT FACE="Arial" SIZE=1>
Calculated on the basis of $5.26 per share, which was the closing price of the common
shares as reported on the NASDAQ National Market System on September 30, 2006.</FONT></TD>
</TR>
</TABLE>


<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2><B>Employment Agreements</B><BR>
<B>Michael R. Cox Employment Agreement</B>&nbsp;&nbsp;On April 1, 2004, the
Company entered into an Employment Agreement with Michael R. Cox, pursuant to
which the Company agreed to employ Mr. Cox as the Chief Financial Officer of the
Company through September 30, 2006. After September 30, 2006, the Employment
Agreement is automatically extended for successive one year periods, until such
time as either Mr. Cox or the Company gives the other party ninety days&#146;
written notice before the end of the term, at which time, the Employment
Agreement will expire at the end of the current term. The Company also agreed to
pay Mr. Cox a base salary of $12,500.00 per month, and granted Mr. Cox options
to purchase 25,000 common shares under the 1997 Employee Incentive Option Plan
and non-qualified options to purchase 25,000 shares of common stock. Mr. Cox is
subject to a confidentiality restriction during his employment and thereafter,
and to non-solicitation restrictions with respect to customers and employees of
BASi during his employment and for two years following termination.</FONT></P>

<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2>The Company may, in its sole and absolute discretion, terminate Mr. Cox&#146;s
employment with the Company without cause, by providing ninety days&#146;
written notice to Mr. Cox. In the event of a termination without cause, Mr. Cox
will be paid his then current annual salary throughout the ninety-day notice
period and for a period of six months thereafter, and will also be paid for all
vacation time accrued as of the termination date. If Mr. Cox&#146;s employment
is terminated by the Company with cause (as defined in the Employment
Agreement), the Company is not obligated to make any further payments to Mr.
Cox.</FONT></P>


<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2><B>Edward M. Chait Employment Agreement</B>&nbsp;&nbsp;On August 1, 2005, the
Company entered into an Employment Agreement with Edward M. Chait, pursuant to
which the Company agreed to employ Mr. Chait as the Executive Vice President,
Chief Science Officer of the Company through July 31, 2007. After July 31, 2007,
the Employment Agreement is automatically extended for successive one year
periods, until such time as either Mr. Chait or the Company gives the other
party ninety days&#146; written notice before the end of the term, at which time
the Employment Agreement will expire at the end of the current term. The Company
also agreed to pay Mr. Chait a base salary of $12,500.00 per month, and granted
Mr. Chait options to purchase 25,000 common shares under the 1997 Employee
Incentive Option Plan and non-qualified options to purchase 25,000 shares of
common stock. Mr. Chait is subject to a confidentiality restriction during his
employment and thereafter, and to non-solicitation restrictions with respect to
customers and employees of BASi during his employment and for two years
following termination.</FONT></P>

<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2>At any time after July 31, 2007, the Company may, in its sole and absolute
discretion, terminate Mr. Chait&#146;s employment with the Company without
cause, by providing ninety days&#146; written notice to Mr. Chait. In the event
of a termination without cause, Mr. Chait will be paid his then current annual
salary throughout the ninety-day notice period and for a period of six months
thereafter, and will also be paid for all vacation time accrued as of the
termination date. If Mr. Chait&#146;s employment is terminated by the Company
with cause (as defined in the Employment Agreement), the Company is not
obligated to make any further payments to Mr. Chait.</FONT></P>




<BR>
<BR>
<P ALIGN=left><FONT FACE="Arial" SIZE=1>
7</FONT></P>




<pAGE>



<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2><B>Richard M. Shepperd Employment Agreement.</B>&nbsp;&nbsp;On September 25, 2006, Mr. Shepperd
was elected as the President and Chief Executive Officer of BASi, and the Compensation
Committee determined Mr. Shepperd&#146;s compensation. On January 11, 2007, the Board of
Directors ratified the decision of the Compensation Committee and approved a written
Employment Agreement with Richard M. Shepperd to memorialize the terms approved by the
Compensation Committee effective October 2, 2006, the date Mr. Shepperd began his active
employment with BASi. Pursuant to the Employment Agreement, BASi agreed to employ Mr.
Shepperd as the President and Chief Executive Officer of BASi through February 28, 2007.
After February 28, 2007, the Employment Agreement is automatically extended for
successive three-month periods, until such time as either Mr. Shepperd or BASi gives the
other party thirty days&#146; written notice before the end of the term, at which time
the Employment Agreement will expire at the end of the then-current term. BASi agreed to
pay Mr. Shepperd a base salary of $35,000.00 per month, plus a quarterly bonus equal to
10% of BASi&#146;s annual earnings before interest, taxes, depreciation and amortization,
capped at $150,000 per quarter. Mr. Shepperd will also be eligible for a discretionary,
performance-based bonus determined by the Board of Directors to be paid at the end of his
term of service. In addition to reimbursement of business expenses in accordance with BASi&#146;s
standard reimbursement policies, Mr. Shepperd will be entitled to reimbursement for
reasonable expenses for living quarters in the Lafayette, Indiana area during the term of
his employment, travel to and from his residence in the Henderson, Nevada area once per
month, Mr. Shepperd is subject to a confidentiality restriction during his employment and
thereafter, and to non-solicitation restrictions with respect to customers and employees
of BASi during his employment and for two years following termination. </FONT></P>

<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2>BASi may, in its sole and absolute discretion, terminate Mr. Shepperd&#146;s employment
with BASi, with or without cause, by providing five days&#146; written notice to Mr.
Shepperd. In the event of termination, Mr. Shepperd will be paid his salary and a
pro-rata portion of any quarterly bonus through the termination date, and will also be
paid for all vacation time accrued as of the termination date.</FONT></P>

<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2><B>Equity Compensation Plan Information</B><BR>
BASi maintains stock option plans that allow for the granting of options to certain key
employees and directors of BASi. The following table gives information about equity
awards under the stock option plans of BASi:</FONT></P>

<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 ALIGN=Center WIDTH=100%>
<TR VALIGN=Bottom>
     <TH align=left COLSPAN=3><FONT FACE="Arial" SIZE=2>Plan Category</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=3><FONT FACE="Arial" SIZE=2>Number of Securities<BR>
to be Issued upon<BR>
Exercise of<BR>
Outstanding Options</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=3><FONT FACE="Arial" SIZE=2>Weighted Average<BR>
Exercise Price of<BR>
Outstanding Options</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=3><FONT FACE="Arial" SIZE=2>Number of Securities<BR>
Remaining Available for<BR>
Future Issuance under the<BR>
Equity Compensation Plan<BR>
(excluding Securities<BR>
Reflected in First Column)</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH></TR>



<TR VALIGN=Bottom>
<TD WIDTH=39% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Equity compensation plans approved</FONT></TD>
<TD WIDTH=1% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=3% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>

<TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=9% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2></FONT></TD>
<TD WIDTH=4% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>

<TD WIDTH=7% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=3% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2></FONT></TD>
<TD WIDTH=7% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>

<TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=14% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2></FONT></TD>
<TD WIDTH=2% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>

<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;&nbsp;by security holders</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>353,870</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>    4</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>.96</FONT></TD><TD ALIGN=right><FONT FACE="Arial" SIZE=2></FONT></TD><TD ALIGN=right><FONT FACE="Arial" SIZE=2>300,373</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Equity compensation plans not approved</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;&nbsp;by security holders</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>50,000</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>    5</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>.14</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&#151;</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Total</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>403,870</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>$</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>    4</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>.98</FONT></td><TD ALIGN=right><FONT FACE="Arial" SIZE=2></FONT></TD><TD ALIGN=right><FONT FACE="Arial" SIZE=2>300,373</FONT></TD></TR>
</TABLE>













<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2>For additional information regarding BASi&#146;s stock option plans, please see Note 8 in
the Notes to Consolidated Financial Statements in BASi&#146;s Annual Report on Form 10-K
for the fiscal year ended September 30, 2006, which is incorporated herein by reference. </FONT></P>

<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2><B>Report of the Compensation and Incentive Stock Option Committee</B><BR>
William E. Baitinger, Leslie B. Daniels and David W. Crabb serve on the Compensation and
Incentive Stock Option Committee (the &#147;Compensation Committee&#148;). The
Compensation Committee has responsibility for the administration of BASi&#146;s executive
compensation program. None of BASi&#146;s executive officers serves as a director of, or
in any compensation-related capacity for, companies with which members of the
Compensation Committee are affiliated. The following report is submitted by the members
of the Compensation Committee:</FONT></P>






<BR>
<BR>
<P ALIGN=left><FONT FACE="Arial" SIZE=1>
8</FONT></P>




<pAGE>






<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2>
BASi&#146;s executive compensation program is designed to align executive compensation
with financial performance, business strategies and the values and objectives of BASi.
BASi&#146;s compensation philosophy is to ensure that the delivery of compensation, both
in the short and long term, is consistent with the sustained progress, growth and
profitability of BASi and acts as an inducement to attract and retain qualified
individuals. This program seeks to enhance the profitability of BASi, and thereby enhance
shareholder value, by linking the financial interests of BASi&#146;s executives with
those of its long-term shareholders. Under the guidance of BASi&#146;s Compensation
Committee, BASi has developed and implemented an executive compensation program to
achieve these objectives while providing executives with compensation opportunities that
are competitive with companies of comparable size in related industries.</FONT></P>

<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2>BASi&#146;s executive compensation program has been designed to implement the objectives
described above and is comprised of the following fundamental elements:</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Arial" SIZE=2>
</FONT></TD>
<TD WIDTH=5%><FONT FACE="Arial" SIZE=2>
&#149;</FONT></TD>
<TD WIDTH=90%><div align=justify><FONT FACE="Arial" SIZE=2>
A base salary that is determined by individual contributions and sustained
performance within an established competitive salary range. Pay for performance
recognizes the achievement of financial goals, accomplishment of corporate and functional
objectives, and performance of individual business units of BASi.</FONT></div></TD>
</TR>
</TABLE>
<BR>



<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Arial" SIZE=2>
</FONT></TD>
<TD WIDTH=5%><FONT FACE="Arial" SIZE=2>
&#149;</FONT></TD>
<TD WIDTH=90%><div align=justify><FONT FACE="Arial" SIZE=2>
Grants of options under BASi&#146;s option plans reward executives when
shareholder value is created through increase in the market value of BASi&#146;s common
shares. Stock option grants focus executives on managing BASi from the perspective of an
owner with an equity position in the business.</FONT></div></TD>
</TR>
</TABLE>


<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2><B>Base Salary</B>.&nbsp;&nbsp;The salary, and any periodic increase thereof, of the President and Chief
Executive Officer were and are determined by the Board of Directors of BASi, excluding
Dr. Kissinger, based on recommendations made by the Compensation Committee. The salaries,
and any periodic increases thereof, of all other executive officers are determined by the
Board of Directors based on Compensation Committee recommendations.</FONT></P>


<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2>BASi, in establishing base salaries, levels of incidental and/or supplemental
compensation, and incentive compensation programs for its officers and key executives,
assesses periodic compensation surveys and published data covering both the BASi industry
and other industries. The level of base salary compensation for officers and key
executives is determined by both the scope of their responsibility and the salary ranges
for officers and key executives of BASi established by the Board of Directors and the
Compensation Committee. Periodic increases in base salary are dependent on the executive&#146;s
proficiency of performance in the individual&#146;s position for a given period and on
the executive&#146;s competency, skill and experience. Base salary increases for eligible
BASi staff were distributed in the first fiscal quarter of 2006.</FONT></P>


<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2>Dr. Kissinger&#146;s annual base salary for the period October 1, 2004 to December 1,
2004 was $104,200 with an adjustment to $108,376.08 on December 1, 2004. No additional
increases have occurred in fiscal year 2006.</FONT></P>

<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2><B>Bonus</B>.&nbsp;&nbsp;In years in which the after-tax net income of BASi exceeds an increase of 7% over
the previous year&#146;s after-tax net income, the Compensation Committee is authorized
to award bonuses to any BASi employee at the Committee&#146;s discretion. Bonuses may
also be awarded at the discretion of the Board of Directors.</FONT></P>


<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2><B>Option Plans</B>.&nbsp;&nbsp;Granting of options pursuant to BASi&#146;s option plans is intended to
align executive interest with the long-term interests of shareholders by linking
executive compensation with enhancement of shareholder value. In addition, grants of
options motivate executives to improve long-term stock market performance by allowing
them to develop and maintain a significant long-term equity ownership position in BASi&#146;s
common shares. In fiscal 2006 no options to purchase shares were awarded.</FONT></P>

<!-- MARKER FORMAT-SHEET="SIGNATURE BLOCK" FSL="Workstation" -->
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=60%><FONT FACE="Arial" SIZE=2>
</FONT></TD>
<TD WIDTH=40%><FONT FACE="Arial" SIZE=2>
Respectfully submitted,<BR>
<BR>
William E. Baitinger,<BR>
David W. Crabb and Leslie B. Daniels</FONT></TD>
</TR>
</TABLE>
<BR>





<BR>
<BR>
<P ALIGN=left><FONT FACE="Arial" SIZE=1>
9</FONT></P>




<pAGE>






<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2><B>Audit Committee Report</B><BR>
The Audit Committee of the Board of Directors (the &#147;Audit Committee&#148;), of which
Messrs. Baitinger, Daniels and Crabb are currently members, is responsible for selecting
our independent auditors, reviewing the scope of the audit engagement and the results of
the audit, approving permitted non-audit services provided by our independent auditors,
reviewing our internal disclosure processes, overseeing our financial reporting
activities and the accounting practices and policies followed in such reporting,
overseeing complaints by employees and others as to BASi&#146;s financial reporting, and
the compliance by our employees with applicable laws, and other matters as the Board of
Directors or the Audit Committee deems appropriate. The Audit Committee met five times
during the year ended September 30, 2006. In fulfilling its responsibilities, the Audit
Committee has reviewed the audited financial statements contained in the annual Report on
Form 10-K for the fiscal year ended September 30, 2006 with BASi&#146;s management and
the independent registered public accountants. These reviews included quality, not just
acceptability, of accounting principles, reasonableness of significant judgments, and
clarity of disclosures in financial statements. Management is responsible for expressing
an opinion on the conformity of those audited financial statements with accounting
principles generally accepted in the United States.</FONT></P>


<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2>The Audit Committee discussed with the independent registered public accountants, the
matters required to be discussed by Statement on Auditing standards No. 61, Communication
with Audit Committees, as amended. In addition, the Audit Committee has discussed with
the independent registered public accountants their independence from BASi and its
management, including the matters in the written disclosures required by Independence
Standards Board Standard No. 1, Independence Discussions with Audit Committees, as
amended, and considered the compatibility of non-audit services with the auditor&#146;s
independence.</FONT></P>


<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2>
In reliance on the reviews and discussions referred to above, the Audit Committee
recommended to the Board of Directors that the audited financial statements be included
in BASi&#146;s Annual Report on Form 10-K for the fiscal year ended September 30, 2006
for filing with the Securities and Exchange Commission.</FONT></P>


<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=60%><FONT FACE="Arial" SIZE=2>
</FONT></TD>
<TD WIDTH=40%><FONT FACE="Arial" SIZE=2>
Respectfully submitted,<BR>
<BR>
William E. Baitinger,<BR>
David W. Crabb and Leslie B. Daniels</FONT></TD>
</TR>
</TABLE>
<BR>





<BR>
<BR>
<P ALIGN=left><FONT FACE="Arial" SIZE=1>
10</FONT></P>


<PAGE>








<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2><B>Stock Price Performance Graph</B><BR>
The following line graph compares yearly percentage change in the cumulative total share
stockholder return on BASi&#146;s common shares against the cumulative total return on
the NASDAQ Composite Index and a composite index based on a group of nine publicly traded
contract research and chemical instrumentation organizations (the &#147;Peer Group Index&#148;)
for the period commencing September 30, 2001 and ending September 30, 2006. </FONT></P>


<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2>The Peer Group Index is comprised of: Covalent Group, Inc.; Kendle International, Inc.;
New Brunswick Scientific Co., Inc.; Molecular Devices; Pharmaceutical Product
Development, Inc.; OI Corp.; Covance, Inc.; Gene Logic, Inc.; and Bio-Rad, Inc.</FONT></P>


<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2>The comparison of total return on investment (change in year-end stock price plus
reinvested dividends) for the applicable period assumes that $100 was invested on
September 30, 2000 in each of BASi, the NASDAQ Composite Index and the Peer Group Index.</FONT></P>

<P ALIGN=center><FONT FACE="Arial" SIZE=2>
<B>COMPARISON OF 5-YEAR CUMULATIVE TOTAL RETURN<BR>
AMONG BIOANALYTICAL SYSTEMS, INC., THE NASDAQ<BR>
COMPOSITE INDEX AND A PEER GROUP</B></FONT></P>

<P ALIGN=center><FONT FACE="Arial" SIZE=2><IMG SRC="img1.jpg"></FONT></P>



<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2>*&nbsp;$100 invested on September 30, 2001 in stock or index-including reinvestment of
dividends. Fiscal year ending September 30.</FONT></P>

<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 ALIGN=Center WIDTH=70%>
<TR VALIGN=Bottom>
     <TH COLSPAN=4><FONT FACE="Arial" SIZE=2></FONT></TH>
     <TH COLSPAN=2><FONT FACE="Arial" SIZE=2>2001</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=1><FONT FACE="Arial" SIZE=2></FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2><FONT FACE="Arial" SIZE=2>2002</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=1><FONT FACE="Arial" SIZE=2></FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2><FONT FACE="Arial" SIZE=2>2003</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=1><FONT FACE="Arial" SIZE=2></FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2><FONT FACE="Arial" SIZE=2>2004</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=1><FONT FACE="Arial" SIZE=2></FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2><FONT FACE="Arial" SIZE=2>2005</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=1><FONT FACE="Arial" SIZE=2></FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2><FONT FACE="Arial" SIZE=2>2006</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=39% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Bioanalytical Systems, Inc.</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=2% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=7% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>100</FONT></TD>
        <TD WIDTH=2% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>.00</FONT></TD>
     <TD WIDTH=6% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>52</FONT></TD>
        <TD WIDTH=2% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>.91</FONT></TD>
     <TD WIDTH=7% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>73</FONT></TD>
        <TD WIDTH=2% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>.65</FONT></TD>
     <TD WIDTH=7% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>94</FONT></TD>
        <TD WIDTH=2% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>.01</FONT></TD>
     <TD WIDTH=7% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>92</FONT></TD>
        <TD WIDTH=2% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>.98</FONT></TD>
     <TD WIDTH=7% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>90</FONT></TD>
        <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>.07</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Nasdaq Composite Index</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>100</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>.00</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>80</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>.97</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>120</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>.85</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>131</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>.16</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>150</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>.08</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>159</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>.80</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Peer Index</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>100</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>.00</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>79</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>.76</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>92</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>.15</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>140</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>.13</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>192</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>.60</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Arial" SIZE=2>244</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>.80</FONT></TD></TR>
</TABLE>

















<BR>
<BR>
<P ALIGN=left><FONT FACE="Arial" SIZE=1>
11</FONT></P>


<PAGE>









<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2><B>Section 16(a) Beneficial Ownership Reporting Compliance</B><BR>
Section 16(a) of the Securities Exchange Act of 1934 requires the BASi directors and
executive officers and persons who beneficially own more than ten percent of BASi&#146;s
Common Shares to file with the Securities and Exchange Commission (&#148;SEC&#148;)reports
showing ownership of and changes in ownership of BASi Common Shares and other equity
securities. On the basis of information submitted by the BASi directors and executive
officers, BASi believes that its directors and executive officers timely filed all
required Section 16(a) filings for fiscal 2006 and (except as disclosed in prior years&#146; proxy
statements) for prior years, except for the inadvertent failure of Mr. Baitinger to
timely file one Form 4 report for three transactions.</FONT></P>

<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2><B>Communications with the Board of Directors</B><BR>
Currently, BASi shareholders may send communications for the Board of Directors directly
to Peter T. Kissinger, Chairman of the Board of Directors, under the &#147;Ask Pete&#148; portion
of the BASi website found at www.bioanalytical.com. Any shareholder who desires to
contact members of the Board of Directors, including non-management members as a group,
may do so by writing to:</FONT></P>

<P ALIGN=center><FONT FACE="Arial" SIZE=2>
Corporate Secretary, Bioanalytical Systems, Inc.<BR>
2701 Kent Avenue<BR>
West Lafayette, IN 47906<BR>
corporatesecretary@bioanalytical.com</FONT></P>

<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2>The corporate secretary will collect all such communications and organize them by subject
matter. Thereafter, each communication will be promptly forwarded to the appropriate
board committee chairperson according to the subject matter of the communication.
Communications addressed to the non-management members as a group will be forwarded to
each non-management member of the board.</FONT></P>

<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2><B>Contacting the Audit Committee</B><BR>
Any person who would like to contact BASi for the purpose of submitting a complaint
regarding accounting, internal accounting controls, or auditing matters may do so by
writing to: </FONT></P>

<P ALIGN=center><FONT FACE="Arial" SIZE=2>Chairman of the Audit Committee, William E. Baitinger<BR>
700 Sugarhill Drive<BR>
West Lafayette, IN 47906<BR>
(765) 743-1023<BR>
auditcommittee@bioanalytical.com<BR>
</FONT></P>

<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2>Upon receipt of a complaint, the Chairman of the Audit Committee will follow a review
process and actions dictated in the Company&#146;s Code of Business Conduct and Ethics.
</FONT></P>

<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2><B>SELECTION OF INDEPENDENT ACCOUNTANTS</B><BR>

The BASi Audit Committee engaged Crowe Chizek and Company LLC (&#147;Crowe&#148;) as BASi&#146;s
independent public accountants for the audit of financial statements for the year ending
September 30, 2006. As previously reported by BASi on a Form 8-K filed with the SEC on
September 14, 2006, BASi&#146;s prior independent accountants, KPMG LLC (&#148;KPMG&#148;)
resigned effective September 14, 2006.  As reported on a Form 8-K filed with the SEC on
November 1, 2006, the Audit Committee engaged Crowe on October 30, 2006.</FONT></P>

<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2>The reports of KPMG for the fiscal years ended September 30, 2005 and 2004, contained no
adverse opinion or disclaimer of opinion and were not qualified or modified as to
uncertainty, audit scope, or accounting principles. In connection with its audits for the
fiscal years ended September 30, 2005 and 2004 and through September 15, 2006, there were
no disagreements with KPMG on any matter of accounting principles or practices, financial
statement disclosure, or auditing scope or procedure, which disagreements, if not
resolved to the satisfaction of KPMG, would have caused them to make reference to the
subject matter of the disagreement in connection with their report on the financial
statements for such period.</FONT></P>





<BR>
<BR>
<P ALIGN=left><FONT FACE="Arial" SIZE=1>
12</FONT></P>


<PAGE>







<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2>During the fiscal years ended September 30, 2006 and 2005, there were no
reportable events (as defined in Regulation S-K, Item 304(a) (1) (v)), except
for a material weakness in BASi&#146;s internal control at June 30, 2006 which
was identified by KPMG and disclosed in Item 9 in the BASi Annual Report on Form
10-K for the year ended September 30, 2006. KPMG noted certain conditions
involving BASi&#146;s internal control and its operation that KPMG considered to
be &#147;material weaknesses.&#148; &#147;Material weakness&#148; was defined in
a letter from KPMG to BASi as &#147;a control deficiency, or combination of
control deficiencies, that results in more than a remote likelihood that a
material misstatement of the annual or interim financial statements will not be
prevented or detected by the entity&#146;s internal control.&#148; The material
weaknesses noted by KPMG consisted of a failure to set an appropriate &#148;tone
at the top&#148; to instill a company-wide attitude of control consciousness;
failure to maintain adequate procedures for anticipating and identifying
financial reporting risks and for reacting to changes in its operating
environment that could have a material effect on financial reporting; failure to
maintain adequately trained personnel to perform effective review of accounting
procedures critical to financial reporting; and a lack of adequately trained
finance and accounting personnel with the ability to apply U.S. generally
accepted accounting principles associated with the impairment of certain
long-lived assets in accordance with Statement of Financial Accounting Standards
No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets.
Management concurred with the assessment of KPMG. KPMG discussed the matters
described in this paragraph with the BASi Audit Committee. BASi authorized KPMG
to respond fully to the inquiries of its successor accountant concerning these
matters.</FONT></P>

<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2>KPMG also communicated to the Audit Committee in the above-referenced letter that BASi
had filed its Report on Form 10-Q for the three- and nine-month periods ended June 30,
2006, prior to the completion of its interim review. KPMG subsequently completed its
interim review and BASi filed an amended report on Form 10-Q/A for the three- and
nine-month periods ended June 30, 2006.</FONT></P>


<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2>BASi engaged Crowe as its principal independent accountants effective as of October 30,
2006. At no time prior to October 30, 2006 had BASi consulted with Crowe regarding
either: (i) the application of accounting principles to a specified transaction, either
completed or proposed; or the type of audit opinion that might be rendered on the BASi
financial statements; or (ii) any matter that was either the subject of a disagreement
(as that term is defined in Item 304(a)(1)(iv) of Regulation S-K and the related
instructions to that Item) or a reportable event (as that term is defined in Item
304(a)(1)(v) of Regulation S-K). </FONT></P>


<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2>Representatives of Crowe are expected to be present at the Annual Meeting. They will have
the opportunity to make a statement if they desire to do so and will be available to
answer appropriate questions concerning the audit of BASi&#146;s financial statements.</FONT></P>


<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 ALIGN=Center WIDTH=50%>
<TR VALIGN=Bottom>
     <TD WIDTH=72% ALIGN=LEFT><FONT FACE="Arial" SIZE=2><B>Audit Fees</B></FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=2% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=10% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>2006</B></FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=2% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=10% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>2005</B></FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Aggregate fees for annual audit, quarterly reviews</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>$350,000</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>$365,000</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>

<TR VALIGN=BOTTOM><TH>&nbsp;</TH></TR>


<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2><B>Tax Fees</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>2006</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>2005</B></FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>Income tax services related to compliance with tax laws</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>$100,000</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>$ 60,000</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Arial" SIZE=2>&nbsp;</FONT></TD></TR>
<TR>
     <TD COLSPAN=3></TD>
     <TD COLSPAN=3></TD>
     <TD COLSPAN=3></TD></TR>
</TABLE>





<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2>BASi policies require that the scope and cost of all work to be performed for BASi by its
independent registered public accountants must be approved by the Audit Committee. Prior
to the commencement of any work by the independent registered public accountants on
behalf of BASi, the independent registered public accountants provide an engagement
letter describing the scope of the work to be performed and an estimate of the fees. The
Audit Committee and the Chief Financial Officer must review and approve the engagement
letter and the estimate before authorizing the engagement. Where fees charged by the
independent registered public accountants exceed the estimate, the Audit Committee must
review and approve the excess fees prior to their payment.</FONT></P>







<BR>
<BR>
<P ALIGN=left><FONT FACE="Arial" SIZE=1>
13</FONT></P>


<PAGE>








<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2><B>2.&nbsp;&nbsp;OTHER MATTERS</B></FONT></P>

<P ALIGN=JUSTIFY><FONT FACE="Arial" SIZE=2>As of the date of this proxy statement, the Board of Directors of BASi has no knowledge
of any matters to be presented for consideration at the Annual Meeting other than those
referred to above. If (a) any matters not within the knowledge of the Board of Directors
as of the date of this proxy statement should properly come before the meeting; (b) a
person not named herein is nominated at the meeting for election as a director because a
nominee named herein is unable to serve or for good cause will not serve; (c) any
proposals properly omitted from this proxy statement and the form of proxy should come
before the meeting; or (d) any matters should arise incident to the conduct of the
meeting, then the proxies will be voted in accordance with the recommendations of the
Board of Directors of BASi.</FONT></P>

<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=60%><FONT FACE="Arial" SIZE=2>
</FONT></TD>
<TD WIDTH=40%><FONT FACE="Arial" SIZE=2>
By Order of the Board of Directors,<BR>
<BR>
Candice B. Kissinger<BR>
Secretary<BR>
January 17, 2007</FONT></TD>
</TR>
</TABLE>
<BR>





<BR>
<BR>
<P ALIGN=left><FONT FACE="Arial" SIZE=1>
14</FONT></P>

<PAGE>




<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><B><font SIZE=2>SIDE A</font></B></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><B><font SIZE=2>REVOCABLE PROXY</font></B></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><b><font size=2>Bioanalytical Systems, Inc.</font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><b><font size=2>Annual Meeting of Shareholders to Be Held Thursday, February 15, 2007</font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>The undersigned shareholder of Bioanalytical Systems, Inc. (&#147;BASi&#148;) hereby appoints Peter T. Kissinger, Lina Reeves-Kerner, and each of them as proxy for the undersigned, to vote all shares of BASi which the undersigned is entitled to vote at the Annual Meeting of Shareholders (the &#147;Meeting&#148;) of BASi to be held on Thursday, February 15, 2007, at 10:00 a.m., at the principal executive offices of BASi, 2701 Kent Avenue, West Lafayette, Indiana, or any adjournment thereof, in connection with all votes taken on the following proposal, described in the Proxy Statement received by the undersigned with the Notice of the Meeting.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>


<table border="0" cellspacing=0 cellpadding=0 width="614" style='margin-left:.25in;border-collapse:collapse'>
    <tr >
        <td width="31" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>1.</font></b>                                                </p> </td>
        <td width="583" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Proposal 1</font></b><font size=2> &#150; Approval of the election of the following individuals to the Board of Directors of BASi: William E. Baitinger, David W. Crabb, Leslie B. Daniels, Candice B. Kissinger and Peter T. Kissinger.</font></p> </td> </tr>
    <tr >
        <td width="31" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="583" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>For&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font><font size=3>  </font><font color="#333333"><b><font size=4></font></b></font></p> </td> </tr>
    <tr >
        <td width="31" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="583" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Any shareholder may withhold authority to vote for any of the above-listed individuals by striking out the name of such individual.</font></b></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.25in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><b><font size=2>Proxy must be signed and dated. See reverse side.</font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><B>SIDE B</B></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font SIZE=2>PRESENTLY NO OTHER BUSINESS IS SCHEDULED TO BE PRESENTED AT THE MEETING. </font><B><font SIZE=2>HOWEVER, BY SIGNING THIS PROXY YOU ARE GIVING THE HOLDER OF THIS PROXY DISCRETIONARY AUTHORITY TO ACT IN ACCORDANCE WITH THE DIRECTION OF THE BOARD OF DIRECTORS ON SUCH MATTERS.</font></B></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>This Proxy, when properly executed, will be voted in the manner directed herein by the undersigned shareholder. </font><b><font size=2>If no direction is made, this Proxy will be voted FOR Proposal 1 with respect to all votes taken on such proposal.</font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>All Proxies previously given by the undersigned are hereby revoked. Receipt of the Notice of Meeting of Shareholders of the Company, the Proxy Statement, and the Company&#146;s 2006 Annual Report is hereby acknowledged.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>This Revocable Proxy may be revoked by the undersigned at any time before it is exercised by (i) executing and delivering to the Company a later-dated Proxy, (ii) attending the Meeting and voting in person, or (iii) giving written notice of revocation to the secretary of the Company.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>Please date this Proxy and sign it exactly as your name appears on your stock certificate. If the shares are jointly held, both shareholders must sign. If signing as attorney, executor, administrator, guardian, or in any other representative capacity, please give your full title as such.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<!-- MARKER FORMAT-SHEET="SIGNATURE BLOCK" FSL="Workstation" -->
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=40%><FONT FACE="ARIAL" SIZE=2>
DATED:&nbsp;&nbsp;<HR WIDTH=250 ALIGN=LEFT></FONT></TD>
<TD WIDTH=60%><FONT FACE="ARIAL" SIZE=2>
IF SHARES ARE JOINTLY HELD, BOTH SHAREHOLDERS MUST SIGN</FONT></TD>
</TR>
</TABLE>
<BR>

<hR>
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=50%><FONT FACE="ARIAL" SIZE=2>
(SIGNATURE)</FONT></TD>
<TD WIDTH=50%><FONT FACE="ARIAL" SIZE=2>
(SIGNATURE)</FONT></TD>
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<hR>
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=50%><FONT FACE="ARIAL" SIZE=2>
PRINT NAME</FONT></TD>
<TD WIDTH=50%><FONT FACE="ARIAL" SIZE=2>
PRINT NAME</FONT></TD>
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<hR>
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=50%><FONT FACE="ARIAL" SIZE=2>
ADDRESS</FONT></TD>
<TD WIDTH=50%><FONT FACE="ARIAL" SIZE=2>
ADDRESS</FONT></TD>
</TR>
</TABLE>




<P ALIGN=JUSTIFY><FONT FACE="aRIAL" SIZE=2>
<B>THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.</B> PLEASE DATE, SIGN,
AND RETURN AS SOON AS POSSIBLE IN THE ENCLOSED ENVELOPE. YOUR VOTE IS IMPORTANT,
REGARDLESS OF THE NUMBER OF SHARES YOU OWN.</FONT></P>
<BR>


<table border="0" cellspacing=0 cellpadding=0 width="487" style='border-collapse:collapse'>
    <tr >
        <td width="697" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Do you plan to personally attend the Annual Meeting of Shareholders?&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Yes&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No</font></p> </td> </tr></table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>



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`
end
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
-----END PRIVACY-ENHANCED MESSAGE-----
