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                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D. C. 20549

                                   FORM 10-K/A
                 -----------------------------------------------
                (Amendment No. 1, amending Part III, Items 10-13)

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

For the Fiscal Year Ended October 31, 1997         Commission File No. 0-7100

                             BASE TEN SYSTEMS, INC.
              ----------------------------------------------------
             (Exact name of registrant as specified in its charter)

    New Jersey                                           22-1804206
-------------------------------                       -------------------
(State or other jurisdiction of                       (I.R.S. Employer
 incorporation or organization)                       Identification No.)

                           One Electronics Drive
                            Trenton, New Jersey                  08619
                --------------------------------------          --------
               (Address of principal executive offices)        (Zip Code)

       Registrant's telephone number, including area code: (609) 586-7010
                                                            -------------

               Securities registered pursuant to Section 12(g) of the Act:

                               Title of each class
                              ---------------------
                              Class A Common Stock
                              Class B Common Stock

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days. Yes X No

Indicate by check mark if disclosure of delinquent  filers  pursuant to Item 405
of  Regulation  S-K under the  Securities  Exchange Act of 1934 is not contained
herein, and will not be contained, to the best of the Registrant's knowledge, in
definitive proxy or information statements incorporated in Part III of this Form
10-K or any amendments to this Form 10-K X

As of January 19,  1998,  7,829,060  shares of Class A Common  Stock and 444,879
shares of Class B Common Stock were outstanding,  and the aggregate market value
of shares held by unaffiliated  stockholders was  approximately  $77,367,440 and
$4,670,285, respectively.

                       DOCUMENTS INCORPORATED BY REFERENCE

This  Form  10-K/A  amends  the  Form  10-K  filed  by the  Registrant  with the
Securities  and Exchange  Commission  on February 11, 1998  ("Registrant's  Form
10-K").  Items  10,  11,  12 and 13 of Part III of  Registrant's  Form 10-K were
incorporated by reference to the Registrant's definitive Proxy Statement for its
1998 Annual Meeting of  Shareholders to be filed with the Commission by February
28,  1998.  The  Registrant  has  filed  preliminary  proxy  material  with  the
Commission.  The  definitive  Proxy  Statement will not be filed by February 28,
1998. Accordingly, Registrant is filing this amendment to Registrant's Form 10-K
to provide  the  information  required by Items 10, 11, 12 and 13 of Part III of
Form 10-K.

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<PAGE>


                                    PART III

Item 10.          Directors and Executive Officers of the Registrant

      The  current  directors  and  executive  officers  of the  Company  are as
follows:

         Name                       Age                 Position
--------------------------------------------------------------------------------


  Thomas E. Gardner                   50            Co-Chairman of the Board
                                                    President
                                                    Chief Executive Officer

  Alexander M. Adelson                63            Co-Chairman of the Board

  Alan S. Poole                       70            Director

  David C. Batten                     53            Director

  William Sword                       74            Director

  C. Richard Bagshaw                  58            Executive Vice President

  Richard J. Farrelly                 66            Senior Vice President

  William F. Hackett                  46            Senior Vice President
                                                    Chief Financial Officer
                                                    Secretary

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

         A summary of the business  experience  and  background of the Company's
current directors and executive officers is set forth below.


         Thomas E.  Gardner  has been  Co-Chairman  of the Board and a  director
since December 31, 1997 and President and Chief Executive Officer since November
1, 1997. Mr. Gardner was President,  Chief  Executive  Officer,  Chief Operating
Officer and a director of Access Health Corporation from 1996 to 1997, and prior
to that was  employed  by the Dun &  Bradstreet  Corporation  from 1990 to 1995,
serving  in  various  senior  executive   positions   including  Corporate  Vice
President,  and President and Chief Executive Officer of Dun & Bradstreet Health
Care Information, Inc.

         Alexander  M.  Adelson  served as Vice  Chairman  from April 1997 until
December 31, 1997 and has been Co-Chairman of the Board since December 31, 1997.
He has been a  director  of Base Ten since  1992.  Since  1974 he has been Chief
Executive Officer of RTS Research Labs Inc., a consulting company  concentrating
in high  technology  fields.  From 1977 to 1989 Mr. Adelson was Chief  Technical
Consultant with Symbol  Technologies,  Inc. Since 1992 Mr. Adelson has also been
providing investment and financial advisory services to the Company.

         Alan S.  Poole has served as a director  of Base Ten since  1994.  From
1960 to 1992,  Mr.  Poole  held  executive  positions  with  Johnson &  Johnson,
including Vice President of Ortho  Diagnostics,  Inc. from 1975 through 1982 and
International Vice President of Johnson & Johnson  Pharmaceutica in Belgium from
1986 to 1992,  where he was  responsible  for the Janssen  Companies  in various
countries. Mr. Poole, now retired, is a member of the California bar.

         David C. Batten has been a director  of Base Ten since April 1997.  Mr.
Batten is a private investor and is actively involved in various venture capital
investments  for  early  stage  companies.  From 1992 to 1994 Mr.  Batten  was a
General Partner of Lazard Freres & Co. in charge of Capital Markets Development,
from 1990 to 1992 was a General Partner in The Blackstone  Group,  and from 1977
to 1990 was a Managing Director of The First Boston Corporation.

         William  Sword has been a director of Base Ten since  January  1997. He
has been  Chairman of the Board of Wm. Sword & Co.  Incorporated,  a diversified
investment banking firm located in Princeton,  New Jersey,  since 1976 and since
1974 has been Chairman of the Board of Sword Holdings Incorporated, a Princeton,
New Jersey  based  company with  corporate  affiliations  throughout  the United
States.  From 1954 to 1976 Mr. Sword was  associated  with Morgan Stanley & Co.,
serving in various capacities  including General Partner,  Director and Managing
Director.  Mr. Sword is also a director of Roadway  Express,  Inc.,  where he is
Chairman of its  Executive and Finance  Committees.  Mr. Sword is also active in
numerous professional and community associations, including The Bond Club of New
York, The Medical Center at Princeton  Foundation and the New Jersey  Historical
Society.

         C. Richard  Bagshaw was President  and General  Manager of Syntex PR of
Humancao,  Puerto  Rico,  a  subsidiary  of Syntex  Pharmaceuticals,  Palo Alto,
California subsequently acquired by Roche Holdings in 1995. From 1991 to 1996 he
was  responsible  for strategy  development  and  implementation  for  corporate
partnering and talent  upgrade.  Mr. Bagshaw joined the Company in December 1997
and has served as Executive Vice President since January 1998.

         Richard J.  Farrelly  has been  employed by the Company  since 1988 and
served  as  Vice  President  from  1992  to  1998,   responsible  for  corporate
development.  In January 1998, Mr.  Farrelly became Senior Vice President of the
Company.  Mr.  Farrelly  was  formerly  General  Manager of the Reentry  Systems
Division of General  Electric  Aerospace  Company and is now serving as a Senior
Vice President  responsible  for human  relations and planning.  Mr. Farrelly is
also Chief Compliance Officer of the Company.

         William F. Hackett was a Senior Manager for the Princeton Data Division
of Bloomberg Financial Markets from 1991 to 1997 responsible for the collection,
analysis,  and distribution of information and product development.  Mr. Hackett
joined the  Company in December  1997 and has served as Senior  Vice  President,
Chief Financial Officer and Secretary since January 1998.

SECTION 16(A) BENEFICIAL OWNERSHIP
REPORTING COMPLIANCE


                  Based on a review of reporting forms filed with the Securities
and Exchange Commission (the "SEC") by officers and directors of the Company and
persons  beneficially  owning more than 10% of any class of capital stock of the
Company, none of such officers, directors or 10% holders failed to file any such
required reports on a timely basis during fiscal 1997.


<PAGE>


Item 11.          Executive Compensation


Summary Compensation Table. The Summary Compensation Table set forth below shows
certain  compensation  information  for the Company's  chief  executive  officer
during the last completed fiscal year and the four other most highly compensated
executive  officers  serving  as  executive  officers  at the  end  of the  last
completed fiscal year (together,  the "Named  Executive  Officers") for services
rendered in all capacities during the three fiscal years ended October 31, 1997,
1996 and 1995.  This  information  includes  base  salaries,  bonus  awards  and
long-term  incentive  plan  payouts,  the  number  of stock  options  and  stock
appreciation rights ("SARs") granted,  and certain other  compensation,  if any,
whether paid or deferred.

<TABLE>
<CAPTION>

                           SUMMARY COMPENSATION TABLE

                                      ANNUAL                       LONG-TERM
                                    COMPENSATION                   COMPENSATION
                                    ------------                   ------------
                                                                  Awards
                                                                  ------
<S>                               <C>        <C>         <C>     <C>        <C>   
Name  and                                                        Options/      All Other
Principal Position                 Year        Salary    Bonus    SARs       Compensation(1)
---------------------------------  ----        ------    ----     -----      ---------------

Myles M. Kranzler,                 1997      $220,000 $   ---         ---      $     ---
President and                      1996       220,000     ---      50,000            ---
Chief Executive Officer            1995       123,310     ---      25,000         42,308

Edward J. Klinsport,               1997       225,000     ---      60,000        112,075(2)
Executive Vice                     1996       195,061  10,000      50,000         29,012
President                          1995       105,002     ---      30,000         39,363

Alan J. Eisenberg,                 1997       225,000     ---     100,000(3)     105,312
Senior Vice President              1996       185,261     ---      50,000         26,042
                                   1995       103,386     ---      30,000         33,183

Richard J. Farrelly,               1997       155,000     ---       4,900         24,224
Vice President                     1996       135,431     ---         ---          8,067
                                   1995        79,982     ---      30,000         37,181

Frank W. Newdeck,                  1997       135,700  17,240       2,000         26,646
Vice President                     1996       135,700   3,080       2,000          9,233
                                   1995       101,993   4,620      15,000            ---


-----------------------------------------------------------------------------------------
</TABLE>

(1) Includes  interest paid on balance of  individuals'  deferred  compensation,
    vacation entitlement payout, commissions,  and 1996 amortization of employee
    loans.  For 1997, the amounts  indicated  represent  forgiveness of employee
    loans.

(2) Includes accrued interest on individual's deferred compensation.

(3) Includes  contingent option grant for 50,000 shares of Class A Common Stock,
    the conditions for which were satisfied on February 10, 1998.


<PAGE>


Option/SAR  Grants in Last Fiscal Year.  The following  table shows  information
regarding  grants of stock options made to the Named  Executive  Officers during
the  fiscal  year  ended  October  31,  1997.  The  amounts  shown as  potential
realizable  values  are  based  on  assumed  annualized  rates  of  stock  price
appreciation of five percent and ten percent over the term of the options. These
potential  realizable  values are based solely on  arbitrarily  assumed rates of
appreciation  required by applicable SEC  regulations.  Actual gains, if any, on
option  exercises  and  common  stock  holdings  are  dependent  on  the  future
performance  of the  Company's  Class A Common  Stock and overall  stock  market
conditions.

<TABLE>
<CAPTION>

                                       OPTION/SAR GRANTS IN LAST FISCAL YEAR

                                                                                                     Potential Realizable
                                                                                                     Value at Assumed
                                                                                                     Annual Rates of
                           Number of            % of Total                                           Stock Price
                           Securities           Options/SARs                                         Appreciation for
                           Underlying           Granted to                                           Option Term
                           Options/SARs         Employees in     Exercise or Base    Expiration      --------------------
Name                       Granted  (1)         Fiscal Year      Price ($/Sh)        Date               5%       10%
----                       ------------         -----------      ------------        -------            --       ---
<S>                           <C>                 <C>               <C>             <C>             <C>         <C> 

Myles M. Kranzler                --                  --               --              --                --          --

Edward J. Klinsport           60,000                9.6%            14 1/2          10/31/99        $ 89,175    $182,700

Alan J. Eisenberg             50,000                8.0%            10 7/8          10/12/07         341,961     866,597
                              50,000(2)             8.0%             7 9/16         02/10/99          38,758      79,406

Richard J. Farrelly            4,900                0.8%            10 3/4          09/22/07          33,127      83,950

Frank W. Newdeck               2,000                0.3%            10 3/4          03/11/07          13,521      34,265



</TABLE>
-----------------------

(1) Class A Common Stock.

(2) Contingent option grant, the conditions for which were satisfied on February
    10, 1998.


<PAGE>


Aggregated  Option/SAR  Exercises  in  Last  Fiscal  Year  and  Fiscal  Year-End
Option/SAR  Values.  The  following  table  summarizes  for  each  of the  Named
Executive  Officers the number of stock options,  if any,  exercised  during the
fiscal year ended  October 31, 1997,  the aggregate  dollar value  realized upon
exercise, the total number of securities underlying unexercised options, if any,
held at  October  31,  1997 and the  aggregate  dollar  value  of  in-the-money,
unexercised  options,  if any,  held at October 31, 1997.  Value  realized  upon
exercise is the difference between the fair market value of the underlying stock
on the  exercise  date and the  exercise or base price of the  option.  Value of
unexercised,  in-the-money  options at fiscal year end is the difference between
the exercise or base price and the fair market value of the underlying  stock on
October 31, 1997. On that date, the last sale prices of the Class A Common Stock
and Class B Common Stock were $14 1/2 and $15 1/2,  respectively.  The values in
the column "Value of Unexercised  In-The-Money  Options/SARs at Fiscal Year End"
have not been, and may never be, realized. The underlying options have not been,
and may not be,  exercised,  and actual  gains,  if any, on exercise will depend
upon the value of the underlying stock on the date of exercise.


<TABLE>
<CAPTION>

                                AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
                                       AND FISCAL YEAR-END OPTION/SAR VALUES

                                                               Number of Securities           Value of Unexercised
                                                               Underlying Unexercised         In-the-Money
                                                               Options/SARs at                Options/SARs at
                             Shares                            FY-End                         FY-End
                             Acquired on       Value           ------                         ------
Name                         Exercise          Realized        Exercisable    Unexercisable   Exercisable    Unexercisable
--------------------------   ---------         ---------       -----------    -------------   -----------    -------------
<S>                          <C>               <C>             <C>               <C>          <C>              <C>  

Myles M. Kranzler
  Class A Common                35,893         $205,487            227,714        8,286       $1,281,067       $   21,026
  Class B Common                  --              ---                 --             --               --               --

Edward J. Klinsport
  Class A Common                  --              ---              243,130        6,610         1,261,911          23,961
  Class B Common                  --              ---                4,946           --            61,825              --

Alan J. Eisenberg
  Class A Common                  --              ---             201,553         31,610(1)     1,310,385      114,586(1)
  Class B Common                  --              ---                 --             --               --               --

Richard J. Farrelly
  Class A Common                  --              ---             48,910         11,510          251,799           42,336
  Class B Common                  --              ---                 --             --               --               --

Frank W. Newdeck
  Class A Common                  --              ---             38,480             --          199,460               --
  Class B Common                  --              ---                 --             --               --               --


</TABLE>

(1) Does not include  contingent option grant of 50,000 shares of Class A Common
    Stock, the conditions for which were satisfied on February 10, 1998.


<PAGE>


DIRECTORS' COMPENSATION

                  Directors  were not paid a fee for  service as a  director  or
Committee  member  during  fiscal 1997.  However,  during  fiscal 1997 Mr. Poole
received,  subject to shareholder approval, an option for 10,000 shares of Class
A Common  Stock,  and Mr.  Batten  received,  subject to  shareholder  approval,
options for an aggregate of 20,000 shares of Class A Common  Stock.  The options
are exercisable at the market price of such stock as of the dates of grant.

EMPLOYMENT CONTRACTS, TERMINATION OF EMPLOYMENT
AND CHANGE IN CONTROL ARRANGEMENTS

                  Under  employment  agreements which were in effect for each of
Messrs. Kranzler, Klinsport and Eisenberg (collectively,  the "Executives") such
Executives were entitled to their  respective  salaries and benefits to the date
of their  termination  if terminated  for "cause" (as defined in the  agreement,
including willful or gross  misconduct,  criminal  indictment,  or other actions
which  significantly  damaged the Company) or if voluntarily  terminating  their
employment  prior  to the  expiration  of  the  twelve  month  term,  which  was
automatically  extended  for one month at the end of each  month and  terminable
(unless  otherwise  terminated)  by either party on twelve  months'  notice.  If
terminated  without  "cause,"  the  Executive  was  entitled  to his  salary and
benefits  to the date of  termination  and a  termination  payment  equal to the
highest annual  combination of his base salary plus any annual bonus paid to the
Executive during the five fiscal years ending before the date of termination. If
the Executives were entitled to payment upon termination  pursuant to the change
in control agreement  described below, the termination  provisions of the change
in control agreement would have prevailed.

                  The Company  also had change in control  agreements  in effect
with each of Messrs.  Kranzler,  Klinsport and Eisenberg,  and continues to have
change  in  control  agreements  with  other  current  executive  officers.  The
agreements  provide  that if,  within  three  years  after  certain  "changes of
control" (as defined in the  agreement,  including an acquisition of 50% or more
of the  combined  voting  power  of the  outstanding  stock  of the  Company,  a
substantial  change in the  composition of the Board not approved by "continuing
directors," or certain mergers or sales involving the Company),  the executive's
employment with the Company is terminated by the Company other than for "cause,"
death or  disability,  or by the  executive for "good reason" (all as defined in
the agreement),  the executive would be entitled to receive,  subject to certain
limitations,  a lump sum cash  payment and health  insurance  benefits for three
years  following  termination of employment,  having an aggregate value equal to
2.99  times  the  total of  average  annual  compensation  and cost of  employee
benefits  for the  executive  for the five years prior to the change of control,
subject to a maximum  amount equal of the Company's  permitted  deduction  under
Section 280G of the Internal Revenue Code. Each current  agreement is subject to
being extended automatically from year to year unless the Company gives at least
fifteen months' prior notice of its election not to extend the term.

         On October 31, 1997, following thirty-two years with the Company, Myles
M. Kranzler,  founder of the Company,  retired as President and Chief  Executive
Officer and, effective on December 31, 1997, Mr. Kranzler retired as Chairman of
the Board and a  director  of the  Company.  Mr.  Kranzler  will  continue  as a
consultant to the Company for a one year term,  subject to extension upon mutual
agreement of the parties.  Pursuant to his separation and consultant  agreement,
Mr.  Kranzler is required to be  available  to the Company for up to  sixty-five
working days for which he will receive consulting  compensation of $100,000 plus
reimbursement for any reasonable out-of-pocket expenses. For consulting services
in excess of 65 working days per year,  Mr.  Kranzler  would receive  consulting
compensation  of $1,600 per day. Under the separation and consultant  agreement,
Mr. Kranzler and his spouse will continue to receive health and dental insurance
coverage for life. Under the agreement, Mr. Kranzler also agreed during the term
of the agreement not to engage in any business related to the Company's business
and during the term of the agreement and for one year  thereafter not to solicit
any of the customers of the Company in connection with any competitive products.
Subsequent to year end, Mr.  Kranzler  received a total payment of $300,000 as a
bonus for services rendered prior to October 31, 1997.

COMPENSATION COMMITTEE INTERLOCKS
AND INSIDER PARTICIPATION

                  The Company's  Compensation Committee consisted in fiscal year
1997 of all of the members of the Board except Mr.  Kranzler.  Of these members,
Messrs.  Adelson,  Eisenberg,  Klinsport  and Cowen were officers of the Company
during all or part of fiscal 1997. On October 31, 1997, Myles Kranzler, founder,
Chairman of the Board,  President and Chief Executive Officer of the Company for
thirty-two  years,  retired as President  and Chief  Executive  Officer,  and on
December 31, 1997, retired as Chairman of the Board and a director. Mr. Kranzler
has continued as a consultant and advisor to the Company.  Thomas E. Gardner has
been  appointed to the Board as  Co-Chairman  of the Board,  President and Chief
Executive Officer,  replacing Mr. Kranzler. Also, in connection with the sale of
the Company's  Government  Technology Division to Strategic  Technology Systems,
Inc., Edward J. Klinsport  resigned as Executive Vice President and Secretary of
the Company on December 31, 1997 and resigned as a director on January 13, 1998.
In April 1997 Bruce D. Cowen,  a Class A director,  resigned  from the Board for
personal  reasons and the Board  appointed  David C.  Batten as a  director.  In
January 1998 William Sword was appointed as a director. In February 1998 Alan J.
Eisenberg  resigned  as a  director  and  also  separated  from the  Company  as
Executive Vice President. In accordance with the New Jersey Business Corporation
Act, a successor director's term expires as of the immediately  following annual
meeting of shareholders.

                  The  Company had a  consulting  arrangement  with Mr.  Adelson
providing for Mr.  Adelson's  transfer to the Company of  intellectual  property
relating to radio tag technology and for various  advisory  services,  including
consulting  on  the  Company's  business,   technical,   marketing  and  related
strategies,  preparation of business plans and other  specialized  services that
the Company might request from time to time. In 1995,  the agreement was renewed
for three years. In connection with the renewal, the Company granted Mr. Adelson
a five-year  nontransferable  option to purchase 36,000 shares of Class A Common
Stock at $7 7/8 per share,  representing  the  market  price of the stock on the
date of grant, and agreed to pay annual  consulting fees of $50,000 plus monthly
consulting  fees of $10,000  in August  1995 and  $15,000  from  September  1995
through May 1997.  Mr.  Adelson is also  entitled to 2 1/2% of the Company's net
proceeds from sales of radio tag devices  incorporating  technology  supplied by
him. The agreement is no longer in effect. The total fee paid to Mr.
Adelson under this consulting agreement in fiscal 1997 was $135,000.

                  The Company had a  consulting  agreement  with Mr. Cowen for a
one-year term through March 1996,  providing for financial  consulting and other
specialized  services  requested by the Company.  The  agreement was extended in
1996 for an  additional  one-year  term,  entitling  Mr.  Cowen to an  option to
purchase  30,000 shares of Class A Common Stock at an exercise price $10 1/4 per
share,  the market  price of such shares on the date of grant,  and to quarterly
fees of $6,250  plus  expense  reimbursements.  This  agreement  is no longer in
effect.  The total fee paid to Mr.  Cowen  under this  consulting  agreement  in
fiscal 1997 was $32,702.

                  The Company had a financial  advisory  agreement  with Messrs.
Adelson and Cowen for financial and  investment  advisory  services on strategic
opportunities,  providing  for success  fees on any  introduced  acquisition  or
equity financing  completed  during the term of the agreement,  subject to Board
approval.  The  agreement  provided  for a cash  fee  equal  to 2% of the  gross
proceeds of an equity  financing or, for an  acquisition,  3% of pretax  profits
earned by the  acquired  operations  over the three years after the  transaction
plus 1% of the consideration  paid by the Company for the acquired company.  For
either an equity  financing or an  acquisition,  the agreement also provided for
the issuance of warrants  based on the terms of the particular  transaction.  On
May  30,  1997,  the  Company  privately  placed  $5.5  million  of  convertible
debentures together with warrants for Class A Common Stock. Mr. Adelson received
warrants to purchase  27,500 shares of Class A Common Stock at an exercise price
of $10.125 per share,  the market  price of Class A Common  Stock on the date of
grant,  and a fee of $55,000,  for  advisory  services in  connection  with such
private placement.

                  In connection with the May 1, 1997 creation of the uPACS,  LLC
(the "LLC")  whereby  the  Company  became the  minority  owner of this  limited
liability company (see "Certain  Transactions with Related Parties" below),  Mr.
Adelson  received a fee of $30,000 from the LLC and will be entitled to receive,
from the LLC, 1% of revenues generated by the LLC up to the first $45 million in
revenues,  in  consideration  of his  services  in  establishing  the LLC and in
obtaining the capital funding therefor.

                  Effective  June 9, 1997,  the  Company and RTS  Research  Lab,
Inc.,  a  corporation  of which Mr.  Adelson  is the sole  owner  and  principal
("RTS"), entered into a consulting agreement with the Company which replaced and
superseded the earlier financial and investment  advisory  agreement between the
Company and Messrs.  Adelson and Cowen  described  above.  Under the  consulting
agreement,  Mr. Adelson through RTS ("Consultant") would, for a three year term,
provide  investor  relations  and  investor  advisory  services to the  Company,
including  being a  liaison  with the  investment  community  on  behalf  of the
Company,  assisting in developing  marketing  strategies in connection  with the
Company's Medical Technology business and the Company's  PHARMASYST(R) products,
and assisting in developing  and marketing the uPACS(TM)  technology,  for which
Consultant  will  receive  $257,500  per  annum  over the term of the  agreement
(which, upon mutual agreement of the parties,  may alternatively be satisfied by
issuance  of  options  for Class A Common  Stock at a rate of an option  for one
share of stock for each $200 of compensation) plus an expense reimbursement and,
subject to shareholder  approval,  a warrant for 45,000 shares of Class A Common
Stock  exercisable in three equal  installments on each of the three anniversary
dates of the agreement,  at an exercise price equal to $10.00,  the market price
of the stock on the date of grant In  addition,  in the event  that  Consultant,
with  prior  Board  approval,  is  successful  during the three year term of the
agreement in arranging for  additional  capital  financing for the Company or in
successfully  assisting in consummating one or more acquisitions,  Consultant is
entitled to receive in connection with any such  financing,  a success fee of 1%
of the net proceeds plus a warrant for Class A Common Stock equal to one warrant
for each $200 of net proceeds,  and in connection with any such  acquisition,  a
success  fee equal to 1/2 % of the fair  market  value of the net  consideration
paid by the Company in such acquisition.  If approved in advance by the Board of
Directors, the Consultant would receive a success fee of $100,000 on the sale of
the Company or one of its divisions.  In no case will  Consultant be entitled to
more than $200,000 in success fees in any eighteen-month period over the term of
the agreement.

                  In connection with the Company's $19 million private placement
of Series A Preferred  Stock which was consummated in December 1997, Mr. Adelson
received a financial  advisory fee of $190,000 plus warrants to purchase  46,875
shares of Class A Common Stock exercisable at $12.50 per share (the market price
of Class A Common Stock as of the closing of the initial  $9.375 million of such
Series A Preferred Stock on December 5, 1997),  and a warrant to purchase 48,125
shares of Class A Common Stock exercisable at $10.31 per share (the market price
of Class A Common Stock on the closing of the balance of such private  placement
on December 31, 1997).

                  During the fiscal  year  ending  October  31,  1997,  Base Ten
operated a Medical Technology Division and a Government  Technology Division. On
December 31, 1997, following approval by the Company's shareholders at a special
shareholders'  meeting, the Company sold the Government Technology Division (the
"GTD Sale") to Strategic  Technology  Systems,  Inc.  ("STS") for aggregate cash
consideration of $3.5 million, a promissory note in a principal amount estimated
to be  approximately  $2.1 million,  and certain other  consideration.  STS is a
newly formed  corporation  managed and partially  owned by individuals who were,
prior to the GTD Sale,  members of the Company's  senior  management,  including
Edward J.  Klinsport,  who prior to the GTD Sale was Executive  Vice  President,
Chief Financial Officer, Secretary and a director of the Company.

                  In connection  with and effective as of the closing of the GTD
Sale, the Company entered into a consulting  agreement with Mr.  Klinsport for a
two year term  following  the GTD Sale with respect to events and matters  which
occurred during Mr.  Klinsport's  tenure as Chief Financial Officer of Base Ten,
provided such services do not interfere with Mr.  Klinsport's  other  employment
duties.  In  consideration  of such  services,  Base  Ten paid  $225,000  to Mr.
Klinsport,  an amount equal to his then current annual salary, and Mr. Klinsport
was also paid $75,000 in connection with his past services for the Company.

                  The Company  and STS also  entered  into a sublease  agreement
under which STS subleased for a five year term approximately  40,000 square feet
of space at the  Company's New Jersey  headquarters  facility at a lease rate of
$7.00 per square  foot for office and  manufacturing  space and $3.00 per square
foot for shared common access space,  plus a  proportionate  amount of utilities
and other building  expenses.  As part of the GTD Sale, the Company and STS also
entered  into a  transition  agreement  pursuant  to which STS will  continue to
provide the Company with certain accounting, reception, personnel and facilities
services for a three month period, in consideration of approximately $194,000.


<PAGE>


Item 12.          Security Ownership of Certain Beneficial Owners and Management

Set forth below is information concerning beneficial ownership of Class A Common
Stock  and  Class B  Common  Stock  as of  January  15,  1998 by (i) each of the
nominees and current directors, (ii) each of the Named Executive Officers listed
in the Summary  Compensation  Table,  (iii) all current  directors and executive
officers of the Company as a group and (iv) all persons  known by the Company to
be the beneficial owners of 5% or more of Class A Common Stock or Class B Common
Stock.

<TABLE>
<CAPTION>

                                                                                           Percent  of Voting
                                                                                           Power  
                                                                                           Represented
                                                Shares                                     by Class A
                                             Beneficially                  Percent         and Class B
Name                                           Owned (1)                  of Class         Combined (2)
--------------------------           ----------------------------         --------         ------------
<S>                                  <C>                   <C>             <C>                     <C>

Myles M. Kranzler (3)(4)             Class A -             510,423           6.21%                 15.6%
                                     Class B -             160,144          36.00

Thomas E. Gardner (4)                Class A -              70,000            .89                   0.6
                                     Class B -                 ---            ---

Edward J. Klinsport (3)(4)           Class A -             256,886           3.18                   2.6
                                     Class B -               7,136           1.59

Alan J. Eisenberg (4)                Class A -             258,163           3.19                   2.1
                                     Class B -                 ---            ---

Richard J. Farrelly (4)              Class A -              61,420           0.78                   0.5
                                     Class B -                 ---            ---

Frank W. Newdeck (4)                 Class A -              38,480           0.49                   0.3
                                     Class B -                 ---            ---

Alexander M. Adelson (4)             Class A -             532,916           6.43                   4.2
                                     Class B -                 ---            ---

David C. Batten(4)                   Class A -              38,900           0.5                    0.3
                                     Class B -                 ---            ---

Alan S. Poole (4)                    Class A -              20,000           0.26                   0.2
                                     Class B -                 ---            ---

William Sword                        Class A -                 ---            ---                    ---
                                     Class B -                 ---            ---

</TABLE>


<PAGE>


<TABLE>
<CAPTION>
                                                                                      
                                                                                           Percent of Voting
                                                                                           Power 
                                                                                           Represented
                                                Shares                                     by Class A 
                                             Beneficially                  Percent         and Class B
Name                                           Owned (1)                  of Class         Combined (2)
-------------------------------      -----------------------------        ---------        ------------------
<S>                                  <C>                 <C>                <C>                    <C>

Jesse L. Upchurch(5)                 Class A -           2,050,400          23.61                  19.4
                                     Class B -              53,900          12.12

Bruce D. Cowen(4)                    Class A -             493,370           6.01                   9.6
                                     Class B -              78,800          17.71

James A. Eby(4)                      Class A -              76,096           0.96                   3.8
                                     Class B -              43,636           9.81

Herzog, Heine, Geduld, Inc.          Class A -              28,895           0.37                   2.4
                                     Class B -              28,895           6.50

Directors and executive officers as  Class A -             723,236           8.57                   5.6
a group (8 persons) (4)              Class B -                 ---            ---

</TABLE>

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

(1)  Ownership  of shares of Class A Stock  Common  included  in the above table
     includes  shares  issuable  upon (a)  conversion of Class B Common Stock in
     accordance  with the terms  thereof  (one share of Class A Common Stock for
     each share of Class B Common Stock),  (b) exercise of  outstanding  options
     and  warrants  to  purchase  Class  A  Common  Stock  which  are  currently
     exercisable  or  exercisable  within  60  days of  January  15,  1998,  (c)
     conversion of Class B Common Stock  issuable  upon exercise of  outstanding
     options to purchase  Class B Common Stock and (d) conversion of outstanding
     convertible  debentures.  Ownership of Class B Common Stock included in the
     above table includes shares  issuable upon exercise of outstanding  options
     to  purchase  Class B Common  Stock  which  are  currently  exercisable  or
     exercisable within 60 days of January 15, 1998.

(2)  Based upon  one-tenth  vote per share of Class A Common  Stock and one vote
     per share of Class B Common Stock. Assumes exercise of options and warrants
     which  are  currently  exercisable  or are  exercisable  within  60 days of
     January 15, 1998, but not the conversion of Class B Common Stock to Class A
     Common Stock.

(3)  Includes (a) as to Mr.  Kranzler  45,300 shares of Class A Common Stock and
     62,823  shares of Class B Common  Stock owned by his wife and (b) as to Mr.
     Klinsport 10 shares of Class A Common Stock owned by his wife.

(4)  Includes as to (a) Mr.  Kranzler  236,000  shares,  (b) Mr.  Gardner 70,000
     shares,  (c)  Mr.  Klinsport  249,740  shares  and  4,946  shares,  (d) Mr.
     Eisenberg  258,163,  (e) Mr. Adelson 460,500  shares,  (f) Mr. Poole 20,000
     shares,  (g) Mr. Newdeck 38,480 shares, (h) Mr. Farrelly 60,420 shares, (i)
     Mr. Batten 20,000 shares,  (j) Mr. Eby 29,460,  (k) Mr. Cowen 300,000,  and
     (l) all  directors and executive  officers as a group  610,920  shares,  of
     Class A Common Stock and Class B Common Stock, respectively,  issuable upon
     the  exercise  of  outstanding  options or  warrants.  which are  currently
     exercisable or exercisable within 60 days of January 15, 1998.

(5)  Based in part on a Statement  on Schedule 13D and a Statement of Changes in
     Beneficial  Ownership  on Form 4 filed  with SEC,  represents  (i)  968,200
     shares of Class A Common  Stock held  directly  by the Estate of  Constance
     Upchurch,  of which Mr.  Upchurch  is the  executor  and  beneficiary  (the
     "Estate"),  (ii)  209,900  shares  of  Class  A  Common  Stock  held  by  a
     corporation  of which Mr.  Upchurch is the sole  shareholder,  (iii) 18,400
     shares of Class A Common Stock held directly by Mr.  Upchurch,  (iv) 53,900
     shares of Class A Common Stock issuable upon  conversion of the same number
     of shares of Class B Common  Stock held  directly  by the  Estate,  and (v)
     800,000 shares of Class A Stock  issuable upon  conversion of the Company's
     9.01% Convertible Subordinated Debentures due August 31, 2003.


<PAGE>


Item 13.      Certain Relationships and Related Transactions

         The Company  entered into a separation  and  consulting  agreement with
Myles  M.  Kranzler,  which  took  effect  November  1,  1997 (see  "Employment
Contracts, Termination of Employment and Change in Control Arrangements" above).

                  On May 1, 1997 the Company entered into an Operating Agreement
(the "Operating  Agreement")  with Jesse L. Upchurch ("LLC Member")  whereby the
Company became a minority owner of a limited liability company.  Under the terms
of the Operating Agreement,  the Company made an initial capital contribution to
the LLC of its rights to its uPACS(TM) technology in return for a 9% interest in
the LLC and the LLC Member made a capital  contribution  of $2 million and later
made a further  capital  contribution of $1 million in return for a 91% interest
in the LLC. In  connection  with the  formation of the LLC, the Company  entered
into a services and license agreement whereby the Company agreed to complete the
development  of the  uPACS(TM)  technology  and  undertake  to market,  sell and
distribute systems using the uPACS(TM) technology.  The LLC will pay the Company
its expenses in  connection  with such  services and the Company will pay to the
LLC  royalties  in  connection  with the sale of  systems  using  the  uPACS(TM)
technology.  At such  time as the LLC has  distributed  to the LLC  Member  $4.5
million of its net cash flow, the Company will become a 63% owner of the LLC and
the LLC Member will own a 37% interest in the LLC.

                  On  August  8,  1996,  the  Company  entered  into a  Purchase
Agreement  with  Jesse  L.  Upchurch  for the sale of up to  $10,000,000  of the
Company's  9.01%  Convertible  Subordinated  Debentures due August 31, 2003 (the
"Debentures").  On August 12, 1996,  the Company  issued and sold a Debenture in
the original  principal  amount of $4,500,000 to Mr.  Upchurch and on August 22,
1996 the Company issued and sold a Debenture in the original principal amount of
$5,500,000 to Mr. Upchurch. Pursuant to the terms of the Purchase Agreement, Mr.
Upchurch  has the right,  provided he continues to hold not less than 80% of the
aggregate  principal amount of the Debentures,  to nominate two directors to the
Board of  Directors  of the Company by giving  written  notice to the Company of
such nominations together with the written consents of such nominees to serve as
directors  not less  than 120 days  prior to the date that the  Company's  proxy
statement in connection  with its annual meeting of shareholders is to be mailed
to  shareholders.  The Company is then required to include the nominees among in
the directors recommended by management in the proxy statement for the next held
annual meeting of shareholders.

                  In October 1994, the Company completed a sale and leaseback of
its  headquarters  and  related  real  estate in  Trenton,  New Jersey  with CKR
Partners,  L.L.C., an investment concern ("CKR").  The principals of CKR include
Myles M. Kranzler,  formerly Chairman,  President and CEO of Base Ten, and Bruce
D. Cowen,  formerly Vice Chairman of Base Ten. The Company received $3.6 million
for the property,  of which  $550,000 was retained by CKR as a security  deposit
due at the end of the 15-year lease term.  The lease provides for annual rent of
$560,000  for the first  five  years,  $615,000  for the  second  five years and
$690,000 for the last five years, with the Company retaining a repurchase option
which may be exercised at any time at amounts  declining to $3.5 million  during
the last five years of the  lease,  although  under  certain  conditions  CKR is
provided the right to sell the premises free of such Company  repurchase option.
The  Company  received  an opinion  from The Talman  Realty  Group,  independent
financial  advisors,  that the terms of the transaction were fair to the Company
and  its  shareholders  from a  financial  point  of  view.  Proceeds  from  the
transaction  were applied by Base Ten  primarily to prepay its mortgage  debt of
approximately $2.8 million on the property.


<PAGE>


                                   SIGNATURES


         Pursuant to the  requirements  of Section 13 or 15(d) of the Securities
Exchange  Act of 1934,  the  Registrant  has duly caused this  Amendment  to its
Annual  Report to be signed on its  behalf by the  undersigned,  thereunto  duly
authorized, this 27th day of February, 1998.


                                                  BASE TEN SYSTEMS, INC.


                                                  THOMAS E. GARDNER
                                               BY:---------------------------
                                                  Thomas E. Gardner
                                                  Chief Executive Officer