<PAGE>   1
                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                              WASHINGTON, DC 20549

                                    FORM 10-Q

     [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
                              EXCHANGE ACT OF 1934

                For the quarterly period ended September 30, 1999

                                       Or

          [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
                        SECURITIES EXCHANGE ACT OF 1934

         For the transition period from              to
                                        ------------    ----------

                         Commission File Number 0-26390

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

            MINNESOTA                                   41-1545493
(State or other jurisdiction of
 incorporation or organization)                   (IRS Employer ID No.)

                              1801 WEST END AVENUE
                                    SUITE 750
                               NASHVILLE, TN 37203
                                 (615) 341-0223
                  (Address including zip code, of Registrant's
                    principal executive offices and telephone
                          number, including area code)

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 has been subject to such filing requirements
for the past 90 days. [X] Yes [ ] No

As of October 15, 1999 there were 3,092,329 shares of the registrant's common
stock outstanding.


<PAGE>   2


                               CELERIS CORPORATION

                                TABLE OF CONTENTS


<TABLE>
<S>                                                                                                            <C>
PART I.  FINANCIAL INFORMATION

Item 1.  Financial Statements (Unaudited)

Condensed Consolidated Balance Sheets as of September 30, 1999 and December 31, 1998 ...........................1
Condensed Consolidated Statements of Operations For the Three and Nine Months
         Ended September 30, 1999 and 1998 .....................................................................2
Condensed Consolidated Statements of Cash Flows For the Nine Months
         Ended September 30, 1999 and 1998 .....................................................................3
Notes to Condensed Consolidated Financial Statements ...........................................................4

Item 2.  Management's Discussion and Analysis of Financial Condition and Results of Operations..................7

Item 3.  Quantitative and Qualitative Disclosures About Market Risks ...........................................10

PART II.  OTHER INFORMATION

Item 1.  Legal Proceedings .....................................................................................11
Item 5.  Other Information .....................................................................................12
Item 6.  Exhibits and Reports on Form 8-K ......................................................................12
</TABLE>


SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF
1995.

This Quarterly Report on Form 10-Q contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as amended and Section
21E of the Securities Exchange Act of 1934, as amended. These forward-looking
statements include statements regarding intent, belief or current expectations
of Celeris Corporation (the "Company") and its management. Such forward-looking
statements are not guarantees of future performance and involve risks and
uncertainties that may cause the Company's actual results to differ materially
from the results discussed in the forward-looking statements. Risks and
uncertainties that might cause such differences include, but are not limited to:
(1) the Company's ability to control costs and keep increases in expenditures
below revenue growth, if any, to achieve profitability and positive cash flow;
(2) the Company's lack of an operating history in the clinical research services
market on which to base expectations for future performance; (3) uncertainty of
market acceptance of the Company's clinical research services; (4) fluctuations
in quarterly operating results as a result of delays in implementing or
termination of particular clinical trials; (5) the Company's dependence on the
amount of research and development activities, particularly clinical trials, of
pharmaceutical, medical device and biotechnology companies; (6) intense
competition in the market for clinical research services; (7) changes in the
Company's backlog including potential cancellation, delay or change in the scope
of client contracts for clinical research services which may leave the Company
with excess capacity; (8) challenges presented by the Company's new clinical
research operations, which will require the Company to attract and integrate new
key employees and to develop new operational and financial systems, procedures
and controls; (9) the Company's dependence on regulation of the pharmaceutical,
medical device and biotechnology industries; (10) a material portion of the
Company's future revenue is dependent on a single client; (11) the possibility
of adverse outcomes related to the Company's shareholder lawsuits or SEC
investigation; (12) the possibility that the Company may be unable to regain
compliance with Nasdaq National Market continued listing requirements, the
Company's appeal to maintain listing on the Nasdaq National Market may be
unsuccessful, or that the Company will be unable to meet the continued listing
requirements for the Nasdaq SmallCap Market; and (13) risks associated with the
Company's discontinued operations, including the failure to realize the
Company's assumptions regarding estimated charges and performance of the assets
sold. The forward-looking statements herein are qualified in their entirety by
the cautionary statement


<PAGE>   3
and risk factors set forth in Item 1, under the caption "Cautionary Statement
and Risk Factors," of the Company's Annual Report on Form 10-K, dated March 30,
1999. A copy of the Form 10-K may be obtained from the Public Reference Branch
of the SEC at 450 Fifth Street NW, Washington, DC at prescribed rates.


<PAGE>   4
ITEM 1. FINANCIAL STATEMENTS (UNAUDITED)

CELERIS CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                              SEPTEMBER 30,       DECEMBER 31,
                                                                  1999              1998
                                                              ------------      ------------
<S>                                                           <C>               <C>
       ASSETS
Current assets:
       Cash and cash equivalents                              $  6,372,260      $  8,138,542
       Short-term investments                                    3,051,643         7,083,851
       Accounts receivable, net of allowance of
            $287,000 and $172,000, respectively                  1,964,766         1,516,712
       Other current assets                                        405,345           412,360
                                                              ------------      ------------
             Total current assets                               11,794,014        17,151,465

Net furniture, fixtures and equipment                            1,338,050         1,012,986
                                                              ------------      ------------
             Total assets                                     $ 13,132,064      $ 18,164,451
                                                              ============      ============

       LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
       Accounts payable and accrued expenses                  $  1,049,057      $  1,024,837
       Deferred revenue and payables                               532,056           398,653
       Accrued compensation                                        368,212           279,853
       Net current liabilities of discontinued operations        1,770,115         4,256,332
                                                              ------------      ------------
             Total current liabilities                           3,719,440         5,959,675

COMMITMENTS AND CONTINGENCIES (Note 5)                                  --                --

SHAREHOLDERS' EQUITY:
       Common stock, $.01 par value - 13,511,111 shares
             authorized; 3,092,329 and 3,139,810 shares
                  issued and outstanding, respectively              30,923            31,398
       Additional paid-in capital                               67,480,206        67,591,615
       Accumulated deficit                                     (58,098,505)      (55,418,237)
                                                              ------------      ------------
             Total shareholders' equity                          9,412,624        12,204,776
                                                              ------------      ------------
             Total liabilities and shareholders' equity       $ 13,132,064      $ 18,164,451
                                                              ============      ============
</TABLE>




         The accompanying notes are an integral part of these condensed
                       consolidated financial statements.





                                       1
<PAGE>   5

CELERIS CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)

<TABLE>
<CAPTION>
                                                          FOR THE THREE MONTHS ENDED     FOR THE NINE MONTHS ENDED
                                                                 SEPTEMBER 30                    SEPTEMBER 30
                                                           -------------------------     ---------------------------
                                                              1999           1998           1999            1998
                                                           -----------    -----------    -----------    ------------
<S>                                                        <C>            <C>            <C>            <C>
Revenue                                                    $ 2,300,558    $ 1,457,854    $ 6,632,149    $  4,202,378
Cost of sales                                                1,487,531      1,075,285      4,504,609       2,733,344
                                                           -----------    -----------    -----------    ------------
           Gross profit                                        813,027        382,569      2,127,540       1,469,034
Selling, general and administrative expenses                 1,848,200      1,504,659      5,706,506       3,337,117
                                                           -----------    -----------    -----------    ------------
           Loss from operations                             (1,035,173)    (1,122,090)    (3,578,966)     (1,868,083)
Interest income, net                                           114,845        289,586        423,698         971,747
                                                           -----------    -----------    -----------    ------------
           Loss from continuing operations                    (920,328)      (832,504)    (3,155,268)       (896,336)

Discontinued operations:
      Loss from discontinued operations                             --             --             --      (4,706,639)
      Gain (loss) on disposal of discontinued operations        75,000             --        475,000      (5,349,000)
                                                           -----------    -----------    -----------    ------------
      Total discontinued operations                             75,000             --        475,000     (10,055,639)
                                                           -----------    -----------    -----------    ------------
           Net loss                                        $  (845,328)   $  (832,504)   $(2,680,268)   $(10,951,975)
                                                           ===========    ===========    ===========    ============

Basic income (loss) per common share:
      Continuing operations                                $     (0.29)   $     (0.26)   $     (1.01)   $      (0.28)
      Discontinued operations                                     0.02             --           0.15           (3.13)
                                                           -----------    -----------    -----------    ------------
                                                           $     (0.27)   $     (0.26)   $     (0.86)   $      (3.41)
                                                           ===========    ===========    ===========    ============
Diluted income (loss) per common share:
      Continuing operations                                $     (0.29)   $     (0.26)   $     (1.01)   $      (0.28)
      Discontinued operations                                     0.02             --           0.15           (3.13)
                                                           -----------    -----------    -----------    ------------
                                                           $     (0.27)   $     (0.26)   $     (0.86)   $      (3.41)
                                                           ===========    ===========    ===========    ============
Weighted average shares outstanding:
      Basic                                                  3,092,350      3,186,404      3,122,174       3,208,347
      Diluted                                                3,092,350      3,186,404      3,122,174       3,208,347
</TABLE>



         The accompanying notes are an integral part of these condensed
                       consolidated financial statements.





                                       2
<PAGE>   6

CELERIS CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)

<TABLE>
<CAPTION>
                                                                 FOR THE NINE MONTHS ENDED
                                                                        SEPTEMBER 30
                                                                ---------------------------
                                                                    1999            1998
                                                                -----------    ------------
<S>                                                             <C>            <C>
OPERATING ACTIVITIES:
   Net loss                                                     $(2,680,268)   $(10,951,975)
   Adjustments to reconcile net loss to net cash
       used in continuing operating activities:
       Depreciation                                                 329,536          95,676
       Provision for bad debts                                      142,200          87,361
       Loss from discontinued operations                                 --       4,706,639
       Loss (gain) on disposal of discontinued operations          (475,000)      5,349,000
       Value of options issued for consulting services               26,938              --

   Changes in operating assets and liabilities:
       Accounts receivable                                         (590,254)       (181,163)
       Other current assets                                           7,015        (233,413)
       Accounts payable and accrued expenses                         71,238          (2,052)
       Deferred revenue and payables                                133,403          88,879
       Accrued compensation                                          88,359         154,365
                                                                -----------    ------------
             Net cash used in continuing operating activities    (2,946,833)       (886,683)

INVESTING ACTIVITIES:
   Purchase of short-term investments                                    --      (9,453,057)
   Sales and maturities of short-term investments                 4,032,208      19,335,188
   Purchases of furniture, fixtures and equipment                  (701,618)       (690,727)
                                                                -----------    ------------
             Net cash provided by investing activities            3,330,590       9,191,404

FINANCING ACTIVITIES:
   Repurchase of common stock                                      (196,913)       (836,885)
   Net proceeds from issuance of common stock                        36,343          48,000
                                                                -----------    ------------
             Net cash used in financing activities                 (160,570)       (788,885)
Cash used in discontinued operations                             (1,989,469)     (6,495,681)
                                                                -----------    ------------
Increase (decrease) in cash and cash equivalents                 (1,766,282)      1,020,155
Cash and cash equivalents at beginning of period                  8,138,542       5,949,478
                                                                -----------    ------------
Cash and cash equivalents at end of period                      $ 6,372,260    $  6,969,633
                                                                ===========    ============

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
      Cash paid during the period for interest                  $        --    $      4,386
</TABLE>



         The accompanying notes are an integral part of these condensed
                       consolidated financial statements.




                                       3


<PAGE>   7

CELERIS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

1. BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements of
Celeris Corporation (the "Company") have been prepared in accordance with
generally accepted accounting principles for interim financial information and
with the instructions to Form 10-Q and Article 10 of Regulation S-X.
Accordingly, they do not include all of the information and footnotes required
by generally accepted accounting principles for complete financial statements.
In the opinion of management, all adjustments (including normal recurring
accruals) considered necessary for a fair presentation have been included.
Certain prior period amounts have been reclassified to conform with current
presentation. Operating results for the three and nine month periods ended
September 30, 1999 are not necessarily indicative of the results that may be
expected for the year ended December 31, 1999. For further information, refer to
the consolidated financial statements and footnotes thereto for the year ended
December 31, 1998 in the Company's Annual Report on Form 10-K.

2. INCOME (LOSS) PER COMMON SHARE

Basic income (loss) per common share is computed by dividing income (loss) for
the period by the weighted average number of shares of common stock outstanding
during the period. The computation of diluted income (loss) per common share
requires that the number of weighted average shares outstanding be increased for
the assumed exercise of dilutive options using the treasury stock method.

Diluted loss per share for the three and nine months ended September 30, 1999
does not include common stock equivalents of 604,136 as their effect would be
antidilutive.

3. DISCONTINUED OPERATIONS

On June 10, 1998 the Company announced its intention to transition out of the
healthcare provider software market and focus its attention on its clinical
research services segment. On December 24, 1998 the Company completed the sale
of its healthcare provider software business. As consideration for the sale, the
Company agreed to a total purchase price of up to $2.0 million, contingent upon
the performance of the assets sold and the buyer's costs to perform prepaid
support and service obligations after the closing. In addition, the Company
agreed to reimburse the buyer for the performance of prepaid support and service
obligations on assigned contracts in the amount of $500,000, which was completed
June 30, 1999. Subsequent to September 30, 1999 the Company determined that,
under the terms of the sale agreement, the purchase price would be fixed at $1.5
million. To date the Company has received $675,000 in proceeds from the sale,
all of which has been recorded as gain on disposal of discontinued operations. A
payment of $200,000 was due September 30, 1999, $75,000 of which was collected
and the Company has agreed to accept payment of the remaining $125,000 prior to
December 31, 1999. Additional proceeds of $700,000 representing the remaining
balance of the purchase price are also due prior to December 31, 1999. The
Company will record the remaining proceeds from the sale of the software segment
as gain on the disposal of discontinued operations in the period collection is
assured. The Company has retained certain liabilities related to the software
segment including certain amounts due under customer contracts and other
liabilities related to the disposal of the segment.

The financial position and results of operations of the healthcare provider
software segment are reported as discontinued operations and all prior periods
have been restated to reflect the discontinued operations. There were no
revenues related to the discontinued segment for the three months and nine
months ended September 30, 1999. Revenues related to the discontinued segment
were $423,480 and $2,704,723 for the three months and nine months ended
September 30, 1998, respectively.



                                       4
<PAGE>   8


4. ONE-FOR-THREE REVERSE STOCK SPLIT

On July 26, 1999, the Board of Directors declared a one-for-three reverse stock
split applicable to shareholders of record July 29, 1999. The stated par value
of the Company's common stock was not changed from $0.01. As a result, a total
of $61,646 was reclassified from the Company's common stock account to the
Company's additional paid-in capital account. Income (loss) per share, common
stock outstanding and stock option data referred to in the financial statements
and notes hereto have been adjusted retroactively to give effect to the reverse
stock split.

5. CONTINGENCIES

The Company is a defendant in IN RE SUMMIT MEDICAL SYSTEMS, INC. SECURITIES
LITIGATION, a consolidated federal court securities action venued in the United
States District Court, District of Minnesota. The putative class action was
filed on March 10, 1997 and alleges violations of Section 10(b) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act") and Rule 10b-5,
Section 20(a) of the Exchange Act, Section 11 of the Securities Act of 1933, as
amended (the "Securities Act"), and Section 15 of the Securities Act. The
Company is also a defendant in a federal court securities action captioned
TEACHERS' RETIREMENT SYSTEM OF LOUISIANA V. SUMMIT MEDICAL SYSTEMS, INC. ET. AL.
The Teachers' Retirement action was filed on April 16, 1997 in the United States
District Court, District of Minnesota and is not a class action. In addition to
the claims alleged in the consolidated action, the Teachers' Retirement
complaint alleges a claim under Section 18(a) of the Exchange Act, common law
fraud, and negligent misrepresentation. Each action alleges, in essence, that
the Company made misleading public disclosures relating to its financial
statements and seeks compensatory damages for losses incurred as a result of
each alleged misleading public disclosure. As to federal securities law claims,
both actions are subject to the Private Securities Litigation Reform Act of 1995
(the "Reform Act"). The actions do not state the monetary damages that are being
sought at this time. The Company intends to defend against these actions
vigorously. There can be no assurance that any judgment, order or decree against
the Company arising out of these actions will not have a material adverse effect
on the Company or its business.

The Division of Enforcement of the Securities and Exchange Commission (the
"Commission") is conducting an investigation of the Company, relating to the
Company's restatement of certain financial statements. The Company is
cooperating fully with the Commission and its investigation. There can be no
assurance that any order, decree or other action issued or taken by the
Commission arising out of its investigation will not result in sanctions against
the Company or certain individuals that could have a material adverse effect on
the Company or its business.

On July 22, 1999, the District Court of Hennepin County, Minnesota ruled in
favor of the Company's motion for summary judgment in the declaratory relief
action, DAVID FOSTER ET.AL. V. SUMMIT MEDICAL SYSTEMS, INC. ET. AL. The District
Court held that the Company's directors' and officers' insurance policies cover
claims related to the Company's pending federal securities actions and the
investigation by the Commission. The insurance underwriters of the Company's
directors' and officers' insurance policies had sought to deny coverage. On
October 6, 1999, the insurance underwriters filed a notice of appeal of the
District Court's order with the Minnesota Court of Appeals. The Company intends
to respond to this appeal vigorously. There can be no assurance that any
decision by the Minnesota Court of Appeals arising out of this appeal will not
have a material adverse effect on the Company or its business.

6. SEGMENT REPORTING INFORMATION

The Company has adopted SFAS No. 131, "Disclosures About Segments of an
Enterprise and Related Information." SFAS No. 131 established standards for
disclosure of financial information related to operating segments of the
Company. SFAS No. 131 defines an operating segment as a component of a company
for which operating results are reviewed regularly by the chief operating
decision maker to determine resource allocation and assess performance. The
Company has four segments reportable under the guidelines of SFAS No. 131: C.L.
McIntosh, the Company's regulatory consulting and clinical research services
subsidiary; site research and clinical trial staffing services group, a start-up
operation formed in the second quarter of 1998; data management and
biostatistical services group, a start-up operation formed in the fourth quarter
of 1998; and the Company's corporate operating function.



                                       5
<PAGE>   9


The Company's operating segment disclosures are as follows:

<TABLE>
<CAPTION>
                                                         SITE RESEARCH &
                                                            CLINICAL         DATA
                                                           MONITORING    MANAGEMENT &
                                                            STAFFING    BIOSTATISTICAL
                                          C.L. MCINTOSH     SERVICES       SERVICES      CORPORATE      CONSOLIDATED
                                          -------------     --------       --------      ---------      ------------
<S>                                        <C>            <C>            <C>            <C>             <C>
THREE MONTHS ENDED SEPTEMBER 30, 1999
-------------------------------------
Revenue                                    $ 1,578,301    $   125,615    $   596,642    $         --    $  2,300,558
Income (loss) from continuing operations        10,341       (362,343)       (60,690)       (507,636)       (920,328)
Segment assets                               2,462,873        337,801        967,413       9,363,977      13,132,064

THREE MONTHS ENDED SEPTEMBER 30, 1998
-------------------------------------
Revenue                                    $ 1,457,854    $        --    $        --    $         --    $  1,457,854
Loss from continuing operations                (98,752)      (592,578)      (131,813)         (9,361)       (832,504)
Segment assets                               1,661,065        360,543             --      19,259,905      21,281,513 (a)

NINE MONTHS ENDED SEPTEMBER 30, 1999
------------------------------------
Revenue                                    $ 5,112,335    $   303,586    $ 1,216,228    $         --    $  6,632,149
Loss from continuing operations               (120,845)    (1,010,652)      (554,717)     (1,469,054)     (3,155,268)
Segment assets                               2,462,873        337,801        967,413       9,363,977      13,132,064

NINE MONTHS ENDED SEPTEMBER 30, 1998
------------------------------------
Revenue                                    $ 4,202,378    $        --    $        --    $         --    $  4,202,378
Income (loss) from continuing operations       (54,275)      (895,501)      (169,965)        223,405        (896,336)
Segment assets                               1,661,065        360,543             --      19,259,905      21,281,513 (a)
</TABLE>

(a) Excludes net long-term assets of discontinued operations of $1,242,026.



                                       6
<PAGE>   10


ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

OVERVIEW

The Company is a provider of specialty clinical research services to
pharmaceutical, medical device and biotechnology manufacturers. Services offered
by the Company include regulatory consulting and strategy, device evaluation,
product and manufacturing quality assurance, statistical analysis and clinical
study design. In addition, in 1998 the Company expanded its service offerings to
include investigative site selection and qualification, clinical monitoring
staffing services, data management and biostatistical consulting.

On June 10, 1998 the Company announced its intention to transition out of the
healthcare provider software market and focus its attention on its clinical
research services segment. On December 24, 1998 the Company completed the sale
of its healthcare provider software business. As consideration for the sale, the
Company agreed to a total purchase price of up to $2.0 million, contingent upon
the performance of the assets sold and the buyer's costs to perform prepaid
support and service obligations after the closing. In addition, the Company
agreed to reimburse the buyer for the performance of prepaid support and service
obligations on assigned contracts in the amount of $500,000, which was completed
June 30, 1999. Subsequent to September 30, 1999 the Company determined that,
under the terms of sale agreement, the purchase price would be fixed at $1.5
million. To date the Company has received $675,000 in proceeds from the sale,
all of which has been recorded as gain on disposal of discontinued operations. A
payment of $200,000 was due September 30, 1999, $75,000 of which was collected
and the Company has agreed to accept payment of the remaining $125,000 prior to
December 31, 1999. Additional proceeds of $700,000 representing the remaining
balance of the purchase price are also due prior to December 31, 1999. The
Company will record the remaining proceeds from the sale of the software segment
as gain on the disposal of discontinued operations in the period collection is
assured. The Company has retained certain liabilities related to the software
segment including certain amounts due under customer contracts and other
liabilities related to the disposal of the segment.

The financial position and results of operations of the healthcare provider
software segment are reported as discontinued operations and all prior period
amounts have been restated to reflect the discontinued operations.

Effective January 29, 1999 the Company changed its name from Summit Medical
Systems, Inc. to Celeris Corporation.

On July 26, 1999, the Company's Board of Directors approved a one-for-three
reverse stock split of its common stock, applicable to shareholders of record at
the close of trading July 29, 1999. The reverse stock split was intended, in
part, to address compliance for continued listing of the Company's common stock
with the Nasdaq Stock Market(R) criteria, which requires a minimum bid price of
$1.00 per share. Income (loss) per share, common stock outstanding and stock
option data included in this form have been adjusted retroactively to give
effect to the reverse stock split. Giving effect to the reverse split, the
Company had approximately 3.1 million shares of common stock outstanding as of
September 30, 1999.

As of September 30, the Company had a backlog of projects for clinical studies
management, data management, clinical monitoring and site research services
valued at approximately $6.2 million. The value of the Company's backlog may be
affected by potential cancellation, delay or change in the scope of projects.

RESULTS OF OPERATIONS

Three Months Ended September 30, 1999 Compared to Three Months Ended September
30, 1998

The Company incurred a net loss of $845,000, or $0.27 per diluted share, for the
three months ended September 30, 1999 as compared to a net loss of $833,000, or
$0.26 per diluted share, for the year earlier period. The 1999 results include a
loss from continuing operations of $920,000, or $0.29 per diluted share, and a
gain on disposal of discontinued operations of $75,000, or $0.02 per diluted
share. The 1998 results consist solely of a loss from continuing operations of
$833,000, or $0.26 per diluted share.



                                       7
<PAGE>   11


Continuing Operations. Revenue from continuing operations for the three months
ended September 30, 1999 was $2.30 million compared to $1.46 million for the
year earlier period, an increase of 57.8%. This increase in revenue is
attributed primarily to increased volume of services performed related to the
Company's expanded service capabilities. However, given the Company's current
size, management believes that fluctuations in the timing of new business may
impact revenue growth rates on a quarterly basis.

Cost of sales were $1.49 million for the 1999 period, or 64.7% of revenue,
compared to $1.08 million for the 1998 period, or 73.8% of revenue. This
decrease in cost of sales as a percentage of revenue is primarily due to
increased utilization of the Company's client service personnel.

Selling, general and administrative expenses were $1.85 million, or 80.3% of
revenue, for the 1999 period compared to $1.50 million, or 103.2% of revenue,
for the 1998 period. This increase in total expenses is primarily due to the
addition of salaries, benefits and other overhead costs associated with the
expansion of the Company's service offerings, including related business
development efforts, which began in the second quarter of 1998. The Company
currently has in place a significant portion of the infrastructure necessary to
support the expanded service offerings and does not anticipate selling, general
and administrative expense growth rates in future periods will match the expense
growth rate between 1998 and 1999.

Interest income for the 1999 period was $115,000 compared to $290,000 for the
1998 period. The decrease is due to the Company's cash and cash equivalents
balance, including short-term investments, which decreased to $9.42 million at
September 30, 1999 from $19.13 million at September 30, 1998, due to losses
incurred related to the Company's continuing and discontinued operations, as
well as capital expenditures.

Discontinued Operations. The gain on disposal of discontinued operations of
$75,000 in the 1999 period represents cash received from the sale of the assets
of the discontinued healthcare provider software segment. Losses from
discontinued operations had no effect on the results of operations during the
three months ended September 30, 1998.

Nine Months Ended September 30, 1999 Compared to Nine Months Ended September 30,
1998

The Company incurred a net loss of $2.68 million, or $0.86 per diluted share,
for the nine months ended September 30, 1999 as compared to a net loss of $10.95
million, or $3.41 per diluted share, for the year earlier period. The 1999
results include a loss from continuing operations of $3.16 million, or $1.01 per
diluted share, and a gain on disposal of discontinued operations of $475,000, or
$0.15 per diluted share. The 1998 results include loss from continuing
operations of $896,000, or $0.28 per diluted share, and a loss from discontinued
operations of $10.06 million, or $3.13 per diluted share.

Continuing Operations. Revenue from continuing operations for the nine months
ended September 30, 1999 was $6.63 million compared to $4.20 million for the
year earlier period, an increase of 57.8%. This increase in revenue is
attributed primarily to increased volume of services performed related to the
Company's expanded service capabilities.

Cost of sales were $4.50 million for the 1999 period, or 67.9% of revenue,
compared to $2.73 million for the 1998 period, or 65.0% of revenue. This
increase is primarily the result of the addition of client service personnel
related to the expansion of the Company's service offerings, which began in the
second quarter of 1998. These additional resources have had and may continue to
have a negative effect on operating margins until such time the individuals are
fully utilized as billable resources.

Selling, general and administrative expenses were $5.71 million, or 86.0% of
revenue, for the 1999 period compared to $3.34 million or 79.4% of revenue, for
the 1998 period. This increase is primarily due to the addition of salaries,
benefits and other overhead costs associated with the expansion of the Company's
service offerings, including related business development efforts, which began
in the second quarter of 1998. The Company currently has in place a significant
portion of the infrastructure necessary to support the expanded service
offerings and does not anticipate selling, general and administrative expense
growth rates in future periods will match the expense growth rate between 1998
and 1999.




                                       8
<PAGE>   12

Interest income for the 1999 period was $424,000 compared to $972,000 for the
1998 period. The decrease is due to the Company's cash and cash equivalents
balance, including short-term investments, which decreased to $9.42 million at
September 30, 1999 from $19.13 million at September 30, 1998, due to losses
incurred related to the Company's continuing and discontinued operations, as
well as capital expenditures.

Discontinued Operations. The gain on disposal of discontinued operations of
$475,000 in the 1999 period represents cash received from the sale of the assets
of the discontinued healthcare provider software segment. For the 1998 period,
the loss from discontinued operations was $10.06 million.

LIQUIDITY AND CAPITAL RESOURCES

The Company's cash and cash equivalents, including short-term investments,
totaled $9.42 million as of September 30, 1999, a decrease of $5.80 million from
December 31, 1998. This decrease was primarily due to a) $2.95 million used in
continuing operations, b) $1.99 million used in discontinued operations, c)
$702,000 used for the purchase of furniture, fixtures and equipment, principally
computer and computer systems equipment, d) $197,000 used for the repurchase of
the Company's common stock, and e) $36,000 provided by the issuance of common
stock in the Employee Stock Purchase Plan.

As of September 30, 1999 the Company had net working capital of $8.07 million,
compared to $11.19 million at December 31, 1998. This decrease resulted
primarily from net losses of $2.68 million incurred during the nine months ended
September 30, 1999. Management anticipates the Company will continue to
experience operating losses at least through 1999, and as a result, it believes
working capital will continue to decline.

As of September 30, 1999, the Company had $1.96 million in accounts receivable,
net of bad debt allowance, related to continuing operations compared to $1.52
million as of December 31, 1998. The Company believes its current allowance of
$287,000 for bad debts is adequate. The Company's days sales outstanding in
accounts receivable was 79 days at September 30, 1999 compared to 88 days at
December 31, 1998. Days sales outstanding in accounts receivable may increase in
future periods as the Company's mix of business related to the expanded service
offerings continues to evolve.

The Company sold its healthcare provider software business effective December
24, 1998. Related to the sale of this business, the Company has received
$675,000 in proceeds to date. Of the $200,000 due September 30, 1999, the
Company has received $75,000 and has agreed to accept payment of the remaining
$125,000 prior to December 31, 1999. Additional proceeds of $700,000,
representing the remaining balance of the purchase price, are also due prior to
December 31, 1999. Also related to the sale of the software business, the
Company has retained certain liabilities of $1.77 million as of September 30,
1999, including certain amounts due under customer contracts and other
liabilities related to the disposal of the segment.

The Company's Board of Directors has authorized a stock repurchase program under
which up to 666,667 shares of the Company's common stock may be repurchased.
From inception of the stock repurchase program in August 1997 through September
30, 1999, the Company has repurchased 439,867 shares of common stock for
approximately $3.05 million. As of September 30, 1999, there were 3,092,329
shares of the Company's common stock issued and outstanding.

The Company anticipates capital expenditures for the balance of 1999 will be
approximately $100,000. In addition, the Company intends to enter into a
three-year lease for equipment worth approximately $380,000. These lease
commitment and capital expenditure estimates are primarily for computer and
computer-related equipment and software associated with the Company's expanded
clinical research services as well as capital expenditures required for new
employees.

The Company believes that continued expenditure of funds will be necessary to
support its future operations, and that cash and cash equivalents of $9.42
million on hand at September 30, 1999 will be sufficient to fund its operations,
capital requirements, and expansion goals through 2000. However, there can be no
assurances that the Company will generate sufficient revenue, or adequately
control costs, to achieve profitability or positive cash flow for periods in or
beyond 1999. If the Company cannot achieve profitability or positive cash flow
or its contingencies



                                       9
<PAGE>   13

result in material expenditures, the Company may require additional external
financing in the future. There can be no assurances that such financing will be
available on terms acceptable to the Company.

The Company has experienced operating losses for each of the past five years.
Net losses for the year ended December 31, 1998 were $12.65 million, and for the
three months and nine months ended September 30, 1999 were $845,000 and $2.68
million, respectively. The Company had an accumulated deficit of $58.10 million
as of September 30, 1999. The Company's ability to increase revenue, and to
achieve profitability and positive cash flow will depend on a number of factors
as summarized above under "Safe Harbor Statement under the Private Securities
Litigation Reform Act of 1995" and under "Cautionary Statement and Risk Factors"
included in Item 1 of the Company's Annual Report on Form 10-K, dated March 30,
1999.

Year 2000 Issue. The Company has substantially completed its readiness
preparations for the potential effect of the situation commonly referred to as
the "Year 2000 Issue," which involves the inability of certain software and
hardware systems to properly recognize and process dates for the year 2000 and
beyond. The Company, with the assistance of outside consultants, has developed
and implemented a plan to evaluate the Company's internal systems and material
third-party relationships.

The Company's clinical research services, particularly its data management
services, depend on the use of hardware and software supplied by third-party
vendors. The Company has determined that substantially all of the hardware and
software it uses to be Year 2000 compliant, including all mission critical
systems. This determination is based upon Year 2000 compliance statements
received from vendors of the hardware and software the Company uses, as well as
an internal testing program. The Company has yet to receive Year 2000 compliance
statements from its vendors of certain desktop applications it uses. Should
unforeseen circumstances prevent a timely completion of all remaining necessary
Year 2000 compliance measures, the Company believes that adequate alternatives
are available for information processing. The Company also has a disaster
recovery plan in place should unforeseen events call for its use. The Company
does not expect to incur material costs to upgrade or replace its Year 2000
non-compliant hardware or software systems. However, the estimates of costs to
complete Year 2000 compliance procedures are based, in part, on compliance
statements received from third-party vendors of the Company's hardware and
software systems. Subsequent revisions to these compliance statements by
third-party vendors could result in revised estimated costs to complete Year
2000 compliance measures. The Company cannot predict whether these revisions, if
any, will be material.

The Company has paid third parties approximately $185,000 on Year 2000 testing,
auditing, and modifications or upgrades through September 30, 1999. The costs of
Year 2000 compliance have been and will be expensed as incurred. The Company
does not anticipate that further expenditures will be necessary to complete Year
2000 compliance measures.

The Company ended all expenditures on Year 2000 testing of its healthcare
provider software products upon the sale of these assets on December 24, 1998.
In connection with the sale of the assets of the Company's healthcare provider
software segment, the Company made certain representations regarding Year 2000
compliance of the Company's software products and agreed to indemnify the buyer
against losses related to a breach of representations and certain third-party
claims related to the operation of the assets prior to the sale. Although the
Company's tests and audits of these software products prior to the asset sale
did not indicate any issues with Year 2000 compliance, if an issue with Year
2000 compliance of these products were to arise, the Company could face claims
under its indemnification obligations.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company has no derivative financial instruments or derivative commodity
instruments in its cash and cash equivalents and short-term investments. The
Company invests its cash and cash equivalents and short-term investments in
investment grade, highly liquid investments, consisting of money market
instruments, U.S. Treasury bills, U.S. Treasury notes, commercial paper and
discounted notes and does not believe these investments are subject to material
market risks. In addition, all of the Company's transactions are conducted and
accounts are denominated in U.S. dollars. Accordingly, the Company is not
exposed to foreign currency risks.



                                       10
<PAGE>   14


PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

The Company is a defendant in IN RE SUMMIT MEDICAL SYSTEMS, INC. SECURITIES
LITIGATION, a consolidated federal court securities action venued in the United
States District Court, District of Minnesota. The putative class action was
filed on March 10, 1997 and alleges violations of Section 10(b) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act") and Rule 10b-5,
Section 20(a) of the Exchange Act, Section 11 of the Securities Act of 1933, as
amended (the "Securities Act"), and Section 15 of the Securities Act. The
Company is also a defendant in a federal court securities action captioned
TEACHERS' RETIREMENT SYSTEM OF LOUISIANA V. SUMMIT MEDICAL SYSTEMS, INC. ET. AL.
The Teachers' Retirement action was filed on April 16, 1997 in the United States
District Court, District of Minnesota and is not a class action. In addition to
the claims alleged in the consolidated action, the Teachers' Retirement
complaint alleges a claim under Section 18(a) of the Exchange Act, common law
fraud, and negligent misrepresentation. Each action alleges, in essence, that
the Company made misleading public disclosures relating to its financial
statements and seeks compensatory damages for losses incurred as a result of
each alleged misleading public disclosure. As to federal securities law claims,
both actions are subject to the Private Securities Litigation Reform Act of 1995
(the "Reform Act"). The actions do not state the monetary damages that are being
sought at this time. The Company intends to defend against these actions
vigorously. There can be no assurance that any judgment, order or decree against
the Company arising out of these actions will not have a material adverse effect
on the Company or its business.

The Division of Enforcement of the Securities and Exchange Commission (the
"Commission") is conducting an investigation of the Company, relating to the
Company's restatement of certain financial statements. The Company is
cooperating fully with the Commission and its investigation. There can be no
assurance that any order, decree or other action issued or taken by the
Commission arising out of its investigation will not result in sanctions against
the Company or certain individuals that could have a material adverse effect on
the Company or its business.

On July 22, 1999, the District Court of Hennepin County, Minnesota ruled in
favor of the Company's motion for summary judgment in the declaratory relief
action, DAVID FOSTER ET.AL. V. SUMMIT MEDICAL SYSTEMS, INC. ET. AL. The District
Court held that the Company's directors' and officers' insurance policies cover
claims related to the Company's pending federal securities actions and the
investigation by the Commission. The insurance underwriters of the Company's
directors' and officers' insurance policies had sought to deny coverage. On
October 6, 1999, the insurance underwriters filed a notice of appeal of the
District Court's order with the Minnesota Court of Appeals. The Company intends
to respond to this appeal vigorously. There can be no assurance that any
decision by the Minnesota Court of Appeals arising out of this appeal will not
have a material adverse effect on the Company or its business.



                                       11
<PAGE>   15


ITEM 5. OTHER INFORMATION

The staff of the Nasdaq Stock Market has notified the Company that the current
market value of its public float does not comply with the Nasdaq National Market
continued listing requirements. Under the applicable continued listing
requirement, the market value of the Company's public float must be at least
$5,000,000. The public float excludes all common shares beneficially held by the
Company's officers, directors and 10 percent shareholders. As of November 8,
1999, the market value of the Company's public float was $3.0 million, based on
a public float of approximately 2.4 million shares of common stock.

The Company has until January 7, 2000 to regain compliance with this continuing
listing requirement. In order to regain compliance, the market value of the
Company's public float must equal or exceed the $5,000,000 minimum for at least
ten consecutive trading days prior to the January 7 deadline. The Nasdaq staff,
however, may require that the Company demonstrate compliance with the
requirement for a longer time period.

The Company intends to utilize Nasdaq's appeal process to maintain its listing
on the National Market. Any appeal would stay the Company's delisting pending
review by the appropriate Nasdaq panel. The Company cannot predict whether an
appeal of any delisting determination will be effective.

The Company may seek to avoid delisting from the Nasdaq Stock Market by applying
to be listed on The Nasdaq SmallCap Market on or before January 7, 2000. The
SmallCap Market is Nasdaq's market for smaller capitalization companies which
provides similar liquidity, market making and corporate governance features as
the National Market. The Company believes that it currently meets the continued
listing requirements for the Nasdaq SmallCap Market and it intends to apply for
listing on such market if it is unable to maintain its listing on the Nasdaq
National Market.

The Company cannot predict whether a listing on the Nasdaq SmallCap Market will
have a material adverse effect on the Company's common stock price and the
trading market for the Company's common stock. A complete delisting of the
Company from the Nasdaq Stock Market would have a material adverse effect on the
liquidity of the trading market for the Company's common stock.

The Company has attached as Exhibit 99 its press release dated November 9, 1999.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

         (a) Exhibits

         3.1      Articles of Incorporation of the Company (incorporated by
                  reference to Exhibits 3.1 and 3.2 of the Company's Annual
                  Report on Form 10-K for the year ended December 31, 1998)

         3.2      Bylaws of the Company (incorporated by reference to Exhibit
                  3.3 of the Company's Annual Report on Form 10-K for the year
                  ended December 31, 1998)

         3.3      Amendment to Amended Articles of Incorporation of the Company

        27.1      Financial Data Schedule (for SEC use only)-Nine Months Ended
                  September 30, 1999

        99.1      Press Release dated October 27, 1999

        99.2      Press Release dated November 9, 1999


         (b) Reports on Form 8-K

             None.



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<PAGE>   16


                              SIGNATURES

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


                                       Celeris Corporation

Date: November 12, 1999

                                       By: /s/ Barbara A. Cannon
                                           -------------------------------------
                                           Barbara A. Cannon
                                           President and Chief Executive Officer

Date: November 12, 1999

                                       By: /s/ Paul R. Johnson
                                           -------------------------------------
                                           Paul R. Johnson
                                           Vice President and Chief Financial
                                           Officer






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