<PAGE>   1

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                   FORM 10-Q/A

[X]      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
            SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD
            ENDED MARCH 31, 2000.

                                       Or

[ ]      TRANSACTION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
            SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM
            ____________________ TO________________, 19___.


                        COMMISSION FILE NUMBER : 0-20937

                        PHOENIX INTERNATIONAL LTD., INC.
              (Exact name of registrant as specified in its charter)

            Florida 59-3171810
(State or other jurisdiction of incorporation            (I.R.S.  Employer
              or organization)                           Identification No.)

500 International Parkway, Heathrow, Florida 32746
(Address of principal executive offices) (Zip Code)

(Registrant's telephone number including area code): (407) 548-5100

                                       N/A

(Former name, former address and former fiscal year, if changed since last
report)


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 the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.

                    Class                       Outstanding at October 23, 2000

         Common Stock, $0.01 par value                   9,410,689
                                                      ---------------
                                                      (No. of Shares)


<PAGE>   2



                                EXPLANATORY NOTE

         As a result of the nonpayment of amounts due under certain software
license arrangements that had been previously recognized as revenue, Phoenix
conducted a comprehensive review of its software licensing arrangements and the
recognition of revenue for the years 1997 through 1999. As a result of that
review, Phoenix determined that, in certain instances, revenue that had been
recognized at the time the software was delivered should have been recognized
either as payments became due, as the related services were performed, upon
completion of all services required under the arrangements, or over the life of
the contract (up to five years). Additionally, in some instances revenue should
have been offset against development costs. In addition, Phoenix has determined
that certain software development costs were capitalized prior to the related
software reaching technological feasibility, or were otherwise capitalized in
error. As a result, we have restated our financial statements for the years
ended December 31, 1999, 1998, and 1997 and the quarterly financial results for
the three-month periods ended March 31, 2000 and 1999. For a further discussion
of the restatement, see Note 1 of the Notes to the Consolidated Financial
Statements included in Phoenix's Form 10-K/A for the year ended December 31,
1999 filed contemporaneously with the filing of this Form 10-Q/A.

         This Form 10-Q/A includes in Item 1 of Part I such restated financial
statements and related notes thereto for the three-month periods ended March 31,
2000 and 1999, and other information related to such restated financial
statements. Except for Items 1 and 5 of Part II and Exhibit 27.1, no other
information included in the original report on Form 10-Q is amended by this Form
10-Q/A.

         The effects of the restatement of the Company's financial statements
for the quarters ended March 31, 2000 and 1999 are as follows:

<TABLE>
<CAPTION>
                                                                March 31, 2000                      March 31, 1999
                                                       As Reported        As Restated        As Reported        As Restated
                                                      ------------       ------------       ------------       ------------

   <S>                                                <C>                <C>                <C>                <C>
   Capitalized software costs, net                    $ 14,535,446       $ 10,804,468       $  8,893,023       $  6,738,391
   Total assets                                         46,240,958         36,874,428         58,305,593         44,145,160
   Deferred revenue                                      4,741,195         13,942,373          2,775,422          8,514,115
   Total liabilities and minority interests             10,331,356         20,040,892          8,846,155         12,199,713
   Shareholders' equity                                 35,909,603         16,833,536         49,459,438         31,945,448

   License fees and other                                2,076,177          1,609,060          2,311,445          3,250,040
   Implementation, customer and software
     support and other service fees                      3,736,343          2,677,431          3,223,310          2,174,136
   Total revenues                                        5,812,520          4,286,491          5,534,755          5,424,176
   Total expenses                                        9,030,684          8,623,132          7,825,612          7,934,536
   Net loss                                             (3,037,860)        (4,156,337)        (1,308,092)        (2,267,014)
   Net loss per share - basic and diluted             $      (0.34)      $      (0.46)      $      (0.15)      $      (0.27)
 </TABLE>



                                       2
<PAGE>   3


                        PHOENIX INTERNATIONAL LTD., INC.

                        TABLE OF CONTENTS TO FORM 10-Q/A

<TABLE>
<CAPTION>
                                                                                                          PAGE
                                                                                                          ----

<S>      <C>                                                                                              <C>
PART 1.  FINANCIAL INFORMATION .....................................................................       4

     Item 1.  Financial Statements (Unaudited) .....................................................       4

              Condensed Consolidated Balance Sheets as of March 31, 2000 and December 31, 1999 .....       4

              Condensed Consolidated Statements Of Operations for the Three Months Ended
              March 31, 2000 and 1999 ..............................................................       5

              Condensed Consolidated Statements of Cash Flows for the Three Months Ended
              March 31, 2000 and 1999 ..............................................................       6

              Notes To Condensed Consolidated Financial Statements .................................       7

     Item 2.  Management's Discussion and Analysis of Financial Condition and Results of
              Operations ...........................................................................      14

     Item 3.  Quantitative and Qualitative Disclosure on Market Risk ...............................      20

Part 2.  OTHER INFORMATION .........................................................................      21

     Item 1.  Legal Proceedings ....................................................................      21

     Item 2.  Changes in Securities ................................................................      21

     Item 3.  Defaults Upon Senior Securities ......................................................      21

     Item 4.  Submission of Matters to a Vote of Security Holders ..................................      21

     Item 5.  Other Information ....................................................................      22

     Item 6.  Exhibits and Reports on Form 8-K .....................................................      27

SIGNATURES .........................................................................................      28

EXHIBIT INDEX ......................................................................................      29
</TABLE>



                                       3

<PAGE>   4


                         PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
                       PHOENIX INTERNATIONAL LTD., INC.
                      CONDENSED CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                                                     (Restated)
                                                                                           -------------------------------
                                                                                             March 31,       December 31,
                                                                                               2000              1999
                                                                                           ------------       ------------
                                                                                           (Unaudited)
<S>                                                                                        <C>                <C>
ASSETS
     Current assets:
        Cash and cash equivalents                                                          $  5,229,593       $  2,484,977
        Accounts receivable, net of allowance for doubtful accounts of $1,273,000 and
            $1,085,000 at March 31, 2000 and December 31, 1999, respectively                  7,847,543          8,039,819
        Interest receivable, related party                                                     (380,222)                --
        Prepaid expenses and other current assets                                               836,656            639,303
                                                                                           ------------       ------------
            Total current assets                                                             13,533,570         11,164,099
     Long-term investments, available for sale                                                6,591,027          8,964,771
     Property and equipment:
        Computer equipment and purchased software                                             5,251,550          5,087,369
        Furniture, office equipment and leasehold improvements                                2,492,830          2,481,248
                                                                                           ------------       ------------
                                                                                              7,744,380          7,568,617
        Accumulated depreciation and amortization                                            (4,372,801)        (3,964,923)
                                                                                           ------------       ------------
            Property and equipment, net                                                       3,371,579          3,603,694
     Capitalized software costs and purchased software, net of accumulated
        amortization of $4,671,000 and $4,099,000 at March 31, 2000 and
        December 31, 1999, respectively                                                      10,804,468         10,077,480
     Goodwill and other intangible assets, net of accumulated
        amortization of $93,000 and $41,000 at March 31, 2000, and
        December 31, 1999, respectively                                                       1,158,220          1,210,268
     Equity investments and other assets                                                      1,415,564          1,515,826
                                                                                           ------------       ------------
        Total assets                                                                       $ 36,874,428       $ 36,536,138
                                                                                           ============       ============

LIABILITIES AND SHAREHOLDERS' EQUITY
     Current liabilities:
        Accounts payable                                                                   $  1,997,455       $    905,395
        Accrued expenses                                                                      2,097,997          2,791,894
        Accrued contractor services                                                           1,487,530          1,683,496
        Capital lease, current portion                                                          158,702            155,223
        Deferred revenue                                                                     13,942,373         14,003,270
                                                                                           ------------       ------------
            Total current liabilities                                                        19,684,057         19,539,278

     Capital lease, long-term portion                                                           158,372            199,870
     Minority interests                                                                         198,463            272,647
     Commitments and contingencies

     Shareholders' equity:
        Common stock, $0.01 par value:
            50,000,000 shares authorized, 9,410,172 and 8,526,942 issued and
            outstanding at March 31, 2000 and December 31, 1999, respectively                    94,102             85,269
        Additional paid-in capital                                                           48,495,230         43,921,394
        Unrealized loss on investments available for sale                                      (694,809)          (577,670)
        Accumulated deficit                                                                 (31,060,987)       (26,904,650)
                                                                                           ------------       ------------
            Total shareholders' equity                                                       16,833,536         16,524,343
                                                                                           ------------       ------------
               Total liabilities and shareholders' equity                                  $ 36,874,428       $ 36,536,138
                                                                                           ============       ============
</TABLE>

The accompanying notes are an integral part of these condensed consolidated
balance sheets.


                                       4

<PAGE>   5
                        PHOENIX INTERNATIONAL LTD., INC.
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                                 Three Months Ended
                                                                                                      March 31,
                                                                                           -------------------------------
                                                                                               2000               1999
                                                                                           ------------       ------------
                                                                                             (Restated)        (Restated)
<S>                                                                                        <C>                <C>
Revenues:
     License fees and other                                                                $  1,609,060       $  3,250,040
     Implementation, customer and software
         support and other service fees                                                       2,677,431          2,174,136
                                                                                           ------------       ------------
            Total revenues                                                                    4,286,491          5,424,176

Expenses:
     Cost of license fees and other                                                           1,112,284            690,237
     Cost of implementation, customer
         and software support and other service fees                                          2,018,169          2,229,842
     Sales and marketing                                                                      1,217,139          1,298,673
     General and administrative                                                               1,536,269          1,059,497
     Product development                                                                      2,739,271          2,656,287
                                                                                           ------------       ------------
         Total expenses                                                                       8,623,132          7,934,536

Other income (expense):
     Interest income                                                                            150,924            305,443
     Interest expense                                                                            (9,702)            (7,814)
     Other loss                                                                                 (22,329)           (19,221)
                                                                                           ------------       ------------

Loss before minority interest and income taxes                                               (4,217,748)        (2,231,952)
Minority interest                                                                                74,184                 --
                                                                                           ------------       ------------

Loss before income taxes                                                                     (4,143,564)        (2,231,952)
Income tax expense                                                                               12,773             35,062
                                                                                           ------------       ------------
Net loss                                                                                   $ (4,156,337)      $ (2,267,014)
                                                                                           ============       ============
Net loss per share - basic and diluted                                                     $      (0.46)      $      (0.27)
                                                                                           ============       ============
Weighted average shares outstanding - basic and diluted                                       8,979,120          8,504,949
                                                                                           ============       ============
</TABLE>


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


                                       5
<PAGE>   6
                       PHOENIX INTERNATIONAL LTD., INC.
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                                 Three Months Ended
                                                                                                     March 31,
                                                                                           -------------------------------
                                                                                               2000              1999
                                                                                           ------------       ------------
                                                                                            (Restated)         (Restated)
<S>                                                                                        <C>                <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss                                                                                   $ (4,156,337)      $ (2,267,014)
     Adjustments to reconcile net loss to net cash
     used in operating activities:
         Depreciation and amortization                                                        1,072,212            812,710
         Provision for doubtful accounts                                                        188,000            110,000
         Minority interest                                                                      (74,184)                --
     Changes in operating assets and liabilities:
         Accounts receivable                                                                      4,276         (2,366,625)
         Interest receivable, related party                                                     380,222                 --
         Prepaid expenses and other current assets                                             (221,299)          (111,843)
         Accounts payable                                                                     1,092,060            255,472
         Accrued expenses                                                                      (889,863)          (138,011)
         Deferred revenue                                                                       (60,897)           615,415
                                                                                           ------------       ------------
            Net cash used in operating activities                                            (2,665,810)        (3,089,896)

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment                                                            (175,763)          (300,180)
Sale of short-term investments                                                                       --          2,819,157
Sale (purchase) of long-term investments                                                      2,380,813           (400,353)
Capitalized software costs                                                                   (1,783,335)        (1,875,185)
                                                                                           ------------       ------------
     Net cash provided by investing activities                                                  421,715            243,439

CASH FLOWS FROM FINANCING ACTIVITIES:
Payments of capital lease obligations                                                           (38,019)           (23,626)
Proceeds from funded research and development arrangements                                      444,061            513,545
Net proceeds from issuance of common stock                                                    4,582,669             77,399
                                                                                           ------------       ------------
     Net cash provided by financing activities                                                4,988,711            567,318
                                                                                           ------------       ------------

     Net increase (decrease) in cash and cash equivalents                                     2,744,616         (2,279,139)
     Cash and cash equivalents at beginning of the period                                     2,484,977          3,795,962
                                                                                           ------------       ------------
     Cash and cash equivalents at end of the period                                        $  5,229,593       $  1,516,823
                                                                                           ============       ============
Supplemental non-cash investment activity:
     Write-down of equity investment                                                       $    124,208       $         --
                                                                                           ============       ============
     Unrealized loss on securities                                                         $    117,139       $    187,479
                                                                                           ============       ============
</TABLE>


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


                                       6
<PAGE>   7


     NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1.   BASIS OF PRESENTATION

         The accompanying unaudited condensed consolidated financial statements
include all adjustments, consisting only of normal recurring accruals, which
Phoenix considers necessary for a fair presentation of the financial position
and the results of operations for the interim periods presented. The condensed
consolidated financial statements have been prepared in accordance with the
rules and regulations of the Securities and Exchange Commission. Accordingly,
certain information and footnote disclosures usually found in financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted. The condensed consolidated financial statements
should be read in conjunction with the consolidated financial statements,
"Selected Financial and Operating Data," and "Management's Discussion and
Analysis of Financial Condition and Results of Operations" included in Phoenix's
1999 Annual Report on Form 10-K/A filed contemporaneously with this Form 10-Q/A.

RESTATEMENT

     As a result of the nonpayment of amounts due under certain software license
arrangements, Phoenix conducted a comprehensive review of its software licensing
arrangements and the recognition of revenue for the years 1997 through 1999. As
a result of that review, Phoenix has determined that, in certain instances,
revenue that was recognized at the time the software was delivered should have
been recognized either as payments became due, as the related services were
performed, upon completion of all services required under the arrangements or in
some instances accounted for as funded development arrangements. In addition,
Phoenix has determined that certain software development costs were capitalized
prior to the related software reaching technological feasibility, or were
otherwise capitalized in error. As a result, the financial statements for the
years ended December 31, 1999, 1998, and 1997 and the quarterly financial
results for the three-month periods ended March 31, 2000 and 1999 have been
restated.


                                       7
<PAGE>   8


     The effects of the restatement of the Company's financial statements for
the quarters ended March 31, 2000 and 1999 are as follows:

<TABLE>
<CAPTION>
                                                                March 31, 2000                     March 31, 1999
                                                       As Reported       As Restated        As Reported        As Restated
                                                      ------------       ------------       ------------       ------------

   <S>                                                <C>                <C>                <C>                <C>
   Capitalized software costs, net                    $ 14,535,446       $ 10,804,468       $  8,893,023       $  6,738,391
   Total assets                                         46,240,958         36,874,428         58,305,593         44,145,160
   Deferred revenue                                      4,741,195         13,942,373          2,775,422          8,514,115
   Shareholders' equity                                 35,909,603         16,833,536         49,459,438         31,945,448

   License fees and other                                2,076,177          1,609,060          2,311,445          3,250,040
   Implementation, customer and software support
       and other service fees                            3,736,343          2,677,431          3,223,310          2,174,136
   Total revenues                                        5,812,520          4,286,491          5,534,755          5,424,176
   Total expenses                                        9,030,684          8,623,132          7,825,612          7,934,536
   Net loss                                             (3,037,860)        (4,156,337)        (1,308,092)        (2,267,014)
   Net loss per share - basic and diluted             $      (0.34)      $      (0.46)      $      (0.15)      $      (0.27)
</TABLE>

2.   NET LOSS PER SHARE

         Net loss per share is calculated and presented in accordance with
Statement of Financial Accounting Standards No. 128, Earnings per Share. Basic
earnings per share is computed using the average number of common shares
outstanding. Diluted earnings per share is computed on the basis of the average
number of common shares outstanding plus the effect of dilutive outstanding
stock options using the "treasury stock" method based on average stock price for
the period.

The following table sets forth the computation of basic and diluted earnings per
share.

<TABLE>
<CAPTION>
                                                            Three Months Ended March 31,
                                                              2000               1999
                                                           -----------       -----------
                                                           (restated)        (restated)

<S>                                                        <C>               <C>
Numerator - net loss                                       $(4,156,337)      $(2,267,014)

Denominator for basic and diluted net loss per share-        8,979,120         8,504,949
  weighted average shares outstanding

Net loss per share - basic and diluted                     $     (0.46)      $     (0.27)
</TABLE>



         Pursuant to Statement of Financial Accounting Standards No. 128 the
denominators for basic and diluted net income per share are identical for the
three-month periods ended March 31, 2000 and 1999, due to Phoenix's net losses.
According to the Statement, the exercise of



                                       8
<PAGE>   9


any outstanding options or warrants for a company with a net loss is considered
antidilutive.

         Employee stock options and warrants exercisable into 1,952,107 and
2,133,142 shares of common stock at March 31, 1999 and March 31, 2000,
respectively, have been excluded from the computation of diluted net loss per
share.

3.   COMPREHENSIVE LOSS

         Phoenix adopted Statement of Financial Accounting Standards No. 130,
Reporting Comprehensive Income, as of January 1, 1998. This Statement
establishes new rules for the reporting and display of comprehensive income and
its components. Comprehensive loss for the three months ended March 31, 2000 and
1999, is comprised of the following:

<TABLE>
<CAPTION>
                                                            Three Months Ended March 31,
                                                              2000               1999
                                                           -----------       -----------
                                                            (restated)        (restated)
<S>                                                        <C>               <C>
Net loss as reported                                       $(4,156,337)      $(2,267,014)
Other comprehensive income:
   Unrealized loss on investments available for
   sale                                                       (117,139)         (187,479)
                                                           -----------       -----------

Comprehensive loss                                         $(4,273,476)      $(2,454,493)
                                                           ===========       ===========
</TABLE>

4.   RECENTLY ISSUED ACCOUNTING STANDARDS

         Effective January 1, 2000, Phoenix is required to adopt the provisions
of SOP 97-2 that limit what is considered vendor-specific objective evidence
(VSOE) of the fair value of the various elements in a multiple-element software
arrangement to the price charged when the same element is sold separately.
Because of the structure of Phoenix's contracts prior to October 1, 2000,
Phoenix has determined that it does not have VSOE, as defined in SOP 97-2, for
all undelivered elements in its software arrangements entered into between
January 1, 2000




                                       9
<PAGE>   10

and October 1, 2000 (the date that Phoenix modified the structure of its
contracts). As a result, all contracts that include maintenance entered during
that period will be required to be recognized over the post-contract support
period, generally five years.

         Statement of Financial Accounting Standards No. 133, Accounting for
Derivative Instruments and Hedging Activities, was issued in June 1998. This
Statement establishes accounting and reporting standards for derivative
financial instruments and requires recognition of derivatives in the Statement
of Financial Position to be measured at fair value. Gains or losses resulting
from changes in the value of derivatives would be accounted for depending on the
intended use of the derivative and whether it qualifies for hedge accounting.
This Statement is effective for our financial statements beginning in 2001. We
are currently studying the future effects of adopting this statement. However,
due to our limited use of derivative financial instruments, adoption of
Statement No. 133 is not expected to have a significant effect on our financial
position or results of operations.

         In December 1999, the Securities and Exchange Commission ("SEC") issued
Staff Accounting Bulletin No. 101, "Revenue Recognition in Financial Statements"
("SAB 101") and amended it in March and June 2000 with respect to the effective
dates. We are required to adopt the provisions of SAB 101 in our fourth fiscal
quarter of 2000 and are currently in the process of assessing the impact of its
adoption. While SAB 101 does not supersede the software industry specific
revenue recognition guidance, which Phoenix believes it is in compliance with,
once complete guidance is disseminated, SAB 101 may change current
interpretations of software revenue recognition requirements. We do not expect
the adoption of SAB 101 to have a significant effect on our financial position
or results of operations.

5.   CONTINGENCIES

Litigation

On November 23, 1999, a lawsuit was filed in the District Court for the Middle
District of Florida as a purported class action initiated by George Taylor, a
former Phoenix employee. Initially, Phoenix and our chief executive officer were
named as defendants. The lawsuit alleges, among other things, that Phoenix and
our chief executive officer improperly recognized revenues, overstated revenues
and failed to disclose that our revenues were allegedly in decline, all of which
allegedly caused our stock price to be higher than it otherwise would have been
during the class period. The lawsuit alleges that these purported actions
violate Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5
promulgated thereunder. On May 5, 2000, the plaintiffs filed an Amended
Complaint which, among other things, (1) adds four additional investors as named
plaintiffs and proposed class representatives; (2) expands the purported class
period to the period from May 5, 1997 to April 15, 1999; and (3) adds Phoenix's
president as an additional named defendant. Phoenix and the other two defendants
filed Motions to Dismiss, which were denied by the Court without opinion in
August 2000. The parties are beginning to conduct discovery. Phoenix's insurance
carriers have denied coverage for the claims in this lawsuit. Phoenix is
vigorously defending this case.

In addition, Phoenix is subject to various claims and legal proceedings covering
a variety of matters arising in the ordinary course of its business activities.


                                       10
<PAGE>   11


Customer Disputes

IBM/Sekerbank. In 1998, Phoenix contracted to provide software and software
development and implementation services as a subcontractor to IBM Turk Limited
Sirketi for the benefit of its customer, Sekerbank T.A.S. In May of 1999, IBM
informed Phoenix that its contract with Sekerbank had been cancelled. IBM then
purported to cancel its contract with Phoenix. According to IBM, Sekerbank
cancelled their contract with IBM because of the failure of Phoenix to perform,
called in an IBM performance bond from a bank, and received most of its money
back from IBM. IBM has paid Phoenix over $1 million under the subcontract, has
requested a return of all funds, and has indicated they may have claims against
Phoenix up to $5.2 million in damages. Phoenix disagrees with IBM's position,
believes that IBM, and not Phoenix, is responsible for the cancellation of the
contract by Sekerbank, and believes that it has claims against IBM under its
subcontract for the remaining value of the contract, which amounts to at least
$3.9 million. The parties are in negotiation to resolve the dispute. The
contract calls for arbitration of disputes; however, no arbitration or other
action has been filed by either party.

6.  SUBSEQUENT EVENTS

Customer Disputes

         Toprakbank. In June of 2000, Phoenix received notice from Toprakbank
A.S., one of its customers in Turkey, that it had canceled its implementation of
the Phoenix System. The parties have exchanged letters making cross claims
against each other. Toprakbank has paid Phoenix $550,000 under the contract and
has requested a refund of this money. Phoenix receivables from Toprakbank exceed
$1.3 million, and Phoenix has requested payment of this amount, plus future
support fees under the contract. The parties are in negotiation to resolve the
dispute. The contract calls for arbitration of disputes; however, no arbitration
or other action has been filed by either party.

         Demirbank. In June of 2000, Phoenix received notice from Demirbank
T.A.S., one of its customers in Turkey, that it has canceled its implementation
of the Phoenix System. To date Demirbank has paid Phoenix over $4.6 million
under its agreement. Phoenix receivables from Demirbank currently exceed
$900,000. No demand has been received from Demirbank. Phoenix has requested
payment of all receivables due. The parties are in negotiation to resolve the
dispute. The contract calls for arbitration of disputes; however, no arbitration
or other action has been filed by either party.

                                       11
<PAGE>   12

DISCUSSIONS WITH LONDON BRIDGE

         On August 22, 2000, we entered into an exclusivity agreement with
London Bridge, which among other things, provided for a 30-day period of
exclusivity during which the parties agreed to work towards definitive
agreements regarding an acquisition of Phoenix by London Bridge. On September
22, 2000, Phoenix and London Bridge extended the period of exclusivity through
October 8, 2000, and agreed to negotiate in good faith with respect to the
execution by that date of a definitive agreement providing for the acquisition
of Phoenix by London Bridge and the extension by London Bridge of a working
capital line of credit of up to $10 million for interim financing. On October 7,
2000, the parties agreed to extend the exclusivity period through October 31,
2000 on the same terms. Drafts of acquisition documents have been circulated for
comment, and we are continuing our discussions and negotiations with London
Bridge concerning the potential acquisition and interim financing. Consummation
of any transaction, however, is contingent on several conditions, including
resolution of the pending purported class action lawsuit and successful
completion of due diligence.

RESTATEMENT OF FINANCIAL RESULTS

         Phoenix announced on August 23, 2000 that it was reviewing its revenue
recognition policies and might be required to restate its prior financial
results, and would be delayed in finalizing its 10-Q for the second quarter of
2000 as a result. This 10-K/A has been filed as a result of that restatement.

NASDAQ TRADING HALT

         On August 23, 2000, the Nasdaq Stock Market halted trading in our
common stock at the last reported price of $3.00 per share. Trading in our
common stock will remain halted until we have satisfied Nasdaq's request for
additional information primarily regarding accounting issues identified in our
press release dated August 22, 2000. Nasdaq also indicated that it would delist
our common stock from trading on the Nasdaq National Market at the opening of
business on September 1, 2000, because of our failure to timely file our June
30, 2000 Form 10-Q, unless we appealed Nasdaq's decision. We timely requested an
appeal, and appeared at a hearing before the Nasdaq Listing Qualifications Panel
on September 22, 2000. The Listing Qualifications Panel stated that if Phoenix
failed to file its restated financial results and required periodic reports on
or before October 20, 2000, then our common stock would be delisted at that
time. We are fully cooperating with Nasdaq and do not expect that the
restatement of our financial statements will impact our ability to maintain
compliance with Nasdaq's quantitative listing requirements.

         Any delisting by Nasdaq would likely have an adverse and material
effect on the price of our common stock and on the ability of our shareholders
to sell their shares. Such delisting could also adversely affect our ability to
obtain additional debt or equity financing and may result in a reduction in the
amount and quality of security analysts' and news media's coverage of our
business operations. There can be no assurance that our actions will be
successful to maintain listing on the Nasdaq National Market.

WORKFORCE REDUCTION AND REORGANIZATION OF OPERATIONS

         On May 11, 2000, we initiated a cost reduction measure by eliminating

                                       12


<PAGE>   13
open positions and terminating approximately 15% of our existing workforce. The
cost of salaries and employee benefits for the terminated employees was
approximately $3.5 million on an annualized basis. Severance-related expenses in
connection with these terminations was approximately $200,000. Following this
workforce reduction, the announcement of the restatement of our financial
results, and the trading halt imposed by Nasdaq, Phoenix has experienced higher
than normal attrition in its employee base.

         As of September 30, Phoenix had 275 employees and contract workers, of
which 99 were engaged in research and development (including research projects
and project development), 64 in U.S. sales, implementation, training and
support, 85 in international sales, implementation, training and support, 2 in
corporate marketing, 18 in finance and administration, and 7 in executive
management. This represents a significant reduction in staff since the end of
1999 in all areas including sales, development, and support. Phoenix has also
given notice to Siemens Australia to reduce the number of development
contractors by an additional 17 before the end of the year. Phoenix is not
currently hiring additional employees or expanding its sales or operations. All
of our executive officers, other than William Zayas and Gregory Blalack who
joined us in 2000, have employment agreements with Phoenix.

         In the third quarter of 2000, Phoenix moved most of its Orlando
operations into one building, and is currently seeking a sublessee for a portion
of its second, smaller facility there. In addition, Phoenix intends to relocate
its UK operations to a serviced office, and is currently in negotiations to
sublease its UK facilities to a third party.

                                       13


<PAGE>   14



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

DISCLOSURE REGARDING FORWARD LOOKING STATEMENTS

This 10-Q contains statements which constitute 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 statements
appear in a number of places in this Quarterly Report and include all statements
that are not historical statements of fact regarding our intent, belief, current
expectations, and those of our management with respect to, among other things:

     -    our financing plans;
     -    trends affecting our financial condition or results of operations;
     -    our growth strategy and operating strategy;
     -    the development and implementation of the Phoenix System and our other
          products;
     -    sales performance and prospects; and
     -    the possible impact on our operations and financial performance of
          market conditions and other factors that have hindered us in the past,
          such as currently-pending litigation and the slowdown in purchases of
          software during 1999.

The words "may," "would," "could," "continue," "will," "expect," "estimate,"
"anticipate," "goal," "strategy," "believe," "hope," "intend," "plan" and
similar expressions are intended to identify forward looking statements.
Forward-looking statements are not guarantees of future performance and involve
risks and uncertainties, many of which we cannot control. Our actual results may
differ materially from those projected in forward looking statements. Among the
key risks, assumptions, and factors that may adversely affect our operating
results, performance, and financial condition are:

     -    whether we will be able to complete a transaction with London Bridge
          or otherwise raise sufficient capital to continue operations;
     -    whether the market conditions and other factors which hindered our
          success in 1999, such as a slowdown in purchase decisions as a result
          of Year 2000 concerns and the negative publicity and litigation
          against us, will continue to affect our operations in the future;
     -    unanticipated delays in developing new products and enhancements;
     -    unanticipated delays in deploying our products and services through
          our application service centers;
     -    whether the market accepts our new products and services, including
          those under development and our e-commerce operating environment and
          services;
     -    our reliance on significant new customers to reach or exceed market
          expectations for our performance;
     -    the timing of customer contracts, which may slip from one quarter to
          later quarters or fiscal periods;
     -    the timing of the recognition of revenue under new contracts;


                                       14


<PAGE>   15

     -    our ability to leverage our sales force, marketing relationships, and
          other distribution channels worldwide to generate new customers;
     -    the distraction of management's time and attention, increased legal
          and other costs, and other adverse impacts of pending litigation and
          negative publicity;
     -    our ability to grow and manage our growth despite adverse market and
          other factors described above; and
     -    competition and other factors discussed in detail in our prior press
          releases and filings with the Securities and Exchange Commission,
          including the "Risk Factors" section of our registration statement on
          Form S-1, as declared effective on August 13, 1997 (No. 333-31415).

         We derive our revenues from two primary sources: (i) license fees for
software products, principally the Phoenix System, and commissions from the sale
of third party software and hardware; and (ii) fees for services, which include
implementation services, custom programming, training, interface development for
third party products, ongoing software support, and Internet/Intranet consulting
services.

         Our quarterly and annual operating results have varied significantly in
the past and may vary significantly in the future. Factors that may cause our
future operating results to vary include, but are not limited to:

         -        whether adverse market conditions and other factors that
                  hindered our sales in 1999 continue to impact our efforts;
         -        the size and timing of significant orders;
         -        the mix of direct and indirect sales;
         -        the mix and timing of U.S. and foreign sales;
         -        the manner in which revenue from new orders is recognized as a
                  result of the application of generally accepted accounting
                  principles;
         -        possible delays or other problems in new product
                  announcements;
         -        changes in our pricing policies and those of our competitors;
         -        possible delays or other problems in the development,
                  implementation, and release of our products and enhancements;
         -        the distraction of management's time, adverse impact on sales
                  and marketing efforts, and possible increased costs due to
                  pending litigation;
         -        whether we will have sufficient capital to satisfy concerns of
                  prospects;
         -        the resolution of disputes;
         -        changes in our strategy and operating expenses; and
         -        competition and general economic factors.

         Product revenues are difficult to forecast because the market for
client/server application software products is evolving and affected by many
different factors, including general considerations beyond our control such as
the recent slowdown attributable to Year 2000 concerns. Our sales cycle varies
substantially from customer to customer and can exceed 12 months in some cases.
In addition, license fee revenue from any particular contract can be recognized
in multiple ways which can cause significant variations in the recognition of
revenue from customer to customer. Depending on how the contract is structured,
the terms of each transaction, and other factors, license fees can be recognized
immediately upon execution of the

REVENUE RECOGNITION

         Effective January 1, 2000, Phoenix is required to adopt the provisions
of SOP 97-2 that limit what is considered vendor-specific objective evidence
(VSOE) of the fair value of the various elements in a multiple-element software
arrangement to the price charged when the same element is sold separately.
Because of the structure of Phoenix's contracts prior to October 1, 2000,
Phoenix has determined that it does not have VSOE, as defined in SOP 97-2, for
all undelivered elements in its software arrangements entered into between
January 1, 2000 and October 1, 2000 (the date that Phoenix modified the
structure of its contracts). As a result, all contracts that include maintenance
entered during that period will be required to be recognized over the
post-contract support period, generally five years.




                                       15
<PAGE>   16

contract (up front), over the period required to implement the software for the
customer (over 3 to 12 months), or over the life of the contract (up to five
years). Therefore we do not believe that quarter-to-quarter comparisons of our
results of operations can or should be relied upon as indications of our future
performance.

YEAR 2000 ISSUES

         We discussed in our reports filed in 1998 and 1999 the nature and
progress of our plans to become Year 2000 ready. In late 1999, we completed the
remediation and testing of our systems. As a result of those planning and
implementation efforts, we experienced no significant disruptions in
mission-critical information technology and non-information technology systems
due to the Year 2000, and believe our systems successfully responded to the Year
2000 date change. We are not aware of any material problems resulting from Year
2000 issues, either with our products, our internal systems, or the products and
services of third parties used in our operations. We will continue to monitor
our mission critical computer applications and those of our suppliers and
vendors throughout the Year 2000 to help ensure that we promptly address any
latent Year 2000 matters that may arise.


                                       16



<PAGE>   17


RESULTS OF OPERATIONS

         The following table sets forth the percentage of total revenues
represented by certain line items in Phoenix's statements of operations for the
periods indicated.

<TABLE>
<CAPTION>
                                                                  Three Months Ended
                                                                      March 31,
                                                                  2000         1999
                                                               ----------   ----------
                                                               (restated)   (restated)
<S>                                                            <C>          <C>
Revenues:
   License fees and other                                         37.5%        59.9%
   Implementation, customer and software support and other
     service fees
                                                                  62.5%        40.1%
    Total revenues                                               100.0%       100.0%

Expenses:
   Cost of license fees and other                                 25.9%        12.7%
   Cost of license fees and other                                 47.1%        41.1%
   Cost of implementation, customer and
      software support and other service fees                     28.4%        23.9%
   General and administrative                                     35.8%        19.5%
   Product development                                            63.9%        49.0%
                                                                ------       ------

    Total expenses                                               201.1%       146.2%

Other income (expense):
   Interest income                                                 3.5%         5.6%
   Interest expense                                               (0.2)%       (0.1)%
   Minority interest                                               1.7%        (0.4)%

Loss before incomes taxes                                        (96.6)%      (41.1)%
Income tax expense                                                 0.3%         0.6%
                                                                ------       ------

Net loss                                                         (96.9)%      (41.7)%
                                                                ======       ======
</TABLE>


                                       17
<PAGE>   18

THREE MONTHS ENDED MARCH 31, 2000, COMPARED TO THREE MONTHS ENDED MARCH 31, 1999

         Revenues. Total revenues decreased by 21% to $4.3 million in the three
months ended March 31, 2000, from $5.4 million in the three months ended March
31, 1999. Revenues from license fees decreased 51% to $1.6 million in the three
months ended March 31, 2000, from $3.3 million in the three months ended March
31, 1999. The decrease in license fee revenues is partially attributable to the
effect of applying subscription accounting to all contracts signed in the first
quarter of 2000, and offset by an increase in the number of new contract
signings, which increased from 4 to 6 license arrangements for the Phoenix
System between the two periods. Under subscription accounting, all license and
service revenues are spread over the term of the contract, which typically
extends for five years after the customer has implemented the system. Since a
significant portion of our license fees are deferred under the provisions of
SOP 97-2, whether through subscription accounting or by other accounting
methods, there is often a lag between the signing of a contract and the
recognition of the related license fee revenue. Revenues from implementation,
customer and software support, and other service fees increased 23% to $2.7
million in the three months ended March 31, 2000, from $2.2 million in the
three months ended March 31, 1999. Customer and software support fees increased
137% from $0.6 million in the three months ended March 31, 1999 to $1.5 million
in the three months ended March 31, 2000 due to an increase in the number of
installed clients, and a one-time deconversion fee of $0.3 million in the
latter period.

         Expenses. Cost of license fees increased 61% to $1.1 million in the
three months ended March 31, 2000, from $0.7 million in the three months ended
March 31, 1999. These costs increased as a result of higher amortization of
capitalized software development costs, which increased from $0.6 million to
$0.8 million between the two periods, and higher royalties and commissions to
third parties.

         Cost of implementation, customer and software support and other
service fees decreased 10% to $2.0 million in the three months ended March 31,
2000, from $2.2 million in the three months ended March 31, 1999, primarily as
a result of decreased employee headcount.

         Sales and marketing expenses decreased 6% to $1.2 million in the three
months ended March 31, 2000, from $1.3 million in the three months ended March
31, 1999, primarily as a result of decreased sales commissions, travel, and
advertising expenses.

         General and administrative expenses increased 45% to $1.5 million in
the three months ended March 31, 2000, from $1.0 million in the three months
ended March 31, 1999. These expenses increased primarily as the result of
higher depreciation, personnel-related costs, professional fees and
administrative costs.

                                       18

<PAGE>   19
         Product development expenses increased 3% to $2.8 million in the three
months ended March 31, 2000, from $2.7 million in the three months ended March
31, 1999.

Product development expenses increased in the 2000 period primarily
as a result of increased personnel-related costs to expand and enhance our
product line, including expenses for contract labor costs incurred at the
Sydney, Australia product development center.

         Other Income (Expense) and Minority Interest. Interest income was
$151,000 in the three months ended March 31, 2000 compared to $305,000 in the
three months ended March 31, 1999. Interest income decreased primarily due to a
decrease in interest yielding investments. Minority interest of $74,000 for the
three months ended March 31, 2000, is the net loss attributed to minority
shareholders of Phoenix International New York (formerly Servers On-Line, Inc.).
Phoenix acquired 54% of Servers On-Line in October 1999.

         Income Tax Expense. Income tax expense was $12,800 for the three months
ended March 31, 2000, and $35,000 for the three months ended March 31, 1999,
reflecting the company's estimate of foreign taxes on projected foreign income.

         Net Loss. Phoenix incurred a net loss of $4.2 million in the three
months ended March 31, 2000, compared to net loss of $2.3 million in the three
months ended March 31, 1999, primarily as a result of a decrease in license fee
revenue, an increase in general and administrative costs, an increase in costs
of license fees and a decrease in interest income.

LIQUIDITY AND CAPITAL RESOURCES

         We fund our cash needs through existing cash and investment balances,
sales of capital stock, interest on investments and, to a lesser extent, through
cash flow from operations. We do not rely on lines of credit or other borrowings
to fund operations. At March 31, 2000, we had cash and cash equivalents of $5.2
million, and long-term investments of $6.6 million. Long-term investments
consist primarily of U.S. Treasury securities. For the three months ended March
31, 2000, our operations used net cash of $(2.7) million, primarily due to our
net loss.

         For the three months ended March 31, 2000, investing activities
provided net cash of $0.4 million, which included $2.4 million from the sale of
investments, reduced primarily by $1.8 million invested in capitalized software
development costs and $0.2 million in purchase of property and equipment.

         Financing activities provided $5.0 million of cash, primarily from the
sale of 861,623 shares of common stock to London Bridge Software Holdings plc
for $5.0 million, less issuance costs. Working capital, excluding deferred
revenue, was $7.8 million as of March 31, 2000.

                                       19


<PAGE>   20
         We believe our cash balances, investments, and cash flow from
operations may not be sufficient to meet working capital, capital expenditure,
and software development requirements through 2000. Cash flows from operating
activities are dependent on continued advance payments from customers, and we
cannot be sure that we will continue to receive these payments or that we will
continue to receive these payments in advance of contract performance on the
same terms as we have in the past. We anticipate that operating and investing
activities will continue to use cash in the future. Consequently, we will
require additional equity or debt financing. These factors raise substantial
doubt about the ability of Phoenix to continue as a going concern. These
statements are "forward looking" statements, which are subject to risks and
uncertainties as previously discussed.


ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ON MARKET RISK

         Phoenix does not use derivative financial instruments in its operations
or investments. While we have significant international operations, our
contracts provide for all payments to be made in U.S. Dollars. We therefore do
not believe that fluctuations in foreign currency exchange rates will have a
material impact on our results or operations. We have experienced foreign
exchange losses from the operations of two of our foreign subsidiaries, but
believe these losses have been immaterial in amount. Foreign exchange risks in
the future could, however, have a material adverse impact on our results of
operations. Phoenix's short term and long term investments are deposited
principally in a single financial institution with significant assets and
consist of U.S. Treasury bills and notes with maturities of less than three
years. We do not consider the interest rate risk for these investments to be
material. We do not have any material credit facilities and, therefore, do not
have a significant risk due to potential fluctuations in interest rates for
loans at this time. Changes in interest rates could decrease our interest
income, could make it more costly to borrow money in the future, and may impede
Phoenix's future acquisition and growth strategies if management determines that
the costs associated with borrowing funds are too high to implement these
strategies.


                                       20
<PAGE>   21
                           PART II OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

         Phoenix is subject to various claims and legal proceedings covering a
variety of matters arising in the ordinary course of its business activities.

         On November 23, 1999, a lawsuit was filed in the District Court for the
Middle District of Florida as a purported class action initiated by George
Taylor, a former Phoenix employee. Initially, Phoenix and our chief executive
officer were named as defendants. The lawsuit alleges, among other things, that
Phoenix and our chief executive officer improperly recognized revenues,
overstated revenues and failed to disclose that our revenues were allegedly in
decline, all of which allegedly caused our stock price to be higher than it
otherwise would have been during the class period. The lawsuit alleges that
these purported actions violate Section 10(b) of the Securities Exchange Act of
1934 and Rule 10b-5 promulgated thereunder. On May 5, 2000, the plaintiffs filed
an Amended Complaint which, among other things, (1) adds four additional
investors as named plaintiffs and proposed class representatives; (2) expands
the purported class period to the period from May 5, 1997 to April 15, 1999; and
(3) adds Phoenix's president as an additional named defendant. Phoenix and the
other two defendants filed Motions to Dismiss, which were denied by the Court
without opinion in August 2000. The parties are beginning to conduct discovery.
Phoenix's insurance carriers have denied coverage for the claims in this
lawsuit. Phoenix is vigorously defending this case.

ITEM 2. CHANGES IN SECURITIES

         In February 2000, London Bridge Software Holdings plc purchased 861,623
shares of Phoenix common stock for $5,000,000, representing a 9.16% equity
interest in Phoenix as of the transaction date. In connection with this
purchase, Phoenix entered into an agreement with London Bridge to market one of
its products called "Vectus." Also in connection with this transaction, Phoenix
paid a total of $150,000 in advisory fees and for a fairness opinion.

         This transaction was not registered with the SEC. To complete this
transaction, Phoenix relied upon the exemptions provided by Section 4(2) of the
Securities Act of 1933, and Regulation D promulgated under the Act. The
transaction was an isolated sale to a single overseas entity. No other persons
were solicited or contacted to participate in this sale. A Form D was timely
filed with the Securities and Exchange Commission in connection with this
transaction.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

         None.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

         None.

                                       21
<PAGE>   22

ITEM 5. OTHER INFORMATION

         Many changes have occurred in Phoenix's business since December 31,
1999. These changes and other events subsequent to year-end 1999 are described
below.

CUSTOMER DISPUTES

         IBM/Sekerbank. In 1998, Phoenix contracted to provide software and
software development and implementation services as a subcontractor to IBM Turk
Limited Sirketi for the benefit of its customer, Sekerbank T.A.S. In May of
1999, IBM informed Phoenix that its contract with Sekerbank had been cancelled.
IBM then purported to cancel its contract with Phoenix. According to IBM,
Sekerbank cancelled their contract with IBM because of the failure of Phoenix to
perform, called in an IBM performance bond, and received most of its money back
from IBM. IBM has paid Phoenix over $1 million under the subcontract, has
requested a return of all funds, and has indicated they may have claims against
Phoenix for up to $5.2 million in damages. Phoenix disagrees with IBM's
position, believes that IBM, and not Phoenix, is responsible for the
cancellation of the contract by Sekerbank, and believes that it has claims
against IBM under its subcontract for the remaining value of the contract, which
amounts to at least $3.9 million. The parties are in negotiation to resolve the
dispute. The contract calls for arbitration of disputes; however, no arbitration
or other action has been filed by either party.

         Toprakbank. In June of 2000, Phoenix received notice from Toprakbank
A.S., one of its customers in Turkey, that it had canceled its implementation of
the Phoenix System. The parties have exchanged letters making cross claims
against each other. Toprakbank has paid Phoenix $550,000 under the contract and
has requested a refund of this money. Phoenix receivables from Toprakbank exceed
$1.3 million, and Phoenix has requested payment of this amount, plus future
support fees under the contract. The parties are in negotiation to resolve the
dispute. The contract calls for arbitration of disputes; however, no arbitration
or other action has been filed by either party.

         Demirbank. In June of 2000, Phoenix received notice from Demirbank
T.A.S., one of its customers in Turkey, that it has canceled its implementation
of the Phoenix System. To date Demirbank has paid Phoenix over $4.6 million
under its agreement. Phoenix receivables from Demirbank currently exceed
$900,000. No demand has been received from Demirbank. Phoenix has requested
payment of all receivables due. The parties are in negotiation to resolve the
dispute. The contract calls for arbitration of disputes; however, no arbitration
or other action has been filed by either party.

DISCUSSIONS WITH LONDON BRIDGE

         In February 2000, London Bridge Software Holdings plc purchased 861,623
shares of Phoenix common stock for $5,000,000. This acquisition made London
Bridge a 9.16% equity owner in Phoenix as of the transaction date. In connection
with such purchase, Phoenix entered into an agreement with London Bridge to
market one of its products called "Vectus."


                                       22
<PAGE>   23

         On August 22, 2000, we entered into an exclusivity agreement with
London Bridge, which among other things, provided for a 30-day period of
exclusivity during which the parties agreed to work towards definitive
agreements regarding an acquisition of Phoenix by London Bridge. On September
22, 2000, Phoenix and London Bridge extended the period of exclusivity through
October 8, 2000, and agreed to negotiate in good faith with respect to the
execution by that date of a definitive agreement providing for the acquisition
of Phoenix by London Bridge and the extension by London Bridge of a working
capital line of credit of up to $10 million for interim financing. On October 7,
2000, the parties agreed to extend the exclusivity period through October 31,
2000 on the same terms. Drafts of acquisition documents have been circulated for
comment, and we are continuing our discussions and negotiations with London
Bridge concerning the potential acquisition and interim financing. Consummation
of any transaction, however, is contingent on several conditions, including
resolution of the pending purported class action lawsuit and successful
completion of due diligence.

RESTATEMENT OF FINANCIAL RESULTS

         Phoenix announced on August 23, 2000 that it was reviewing its revenue
recognition policies and might be required to restate its prior financial
results, and would be delayed in finalizing its 10-Q for the second quarter of
2000 as a result. This 10-K/A has been filed as a result of that restatement.

NASDAQ TRADING HALT

         On August 23, 2000, the Nasdaq Stock Market halted trading in our
common stock at the last reported price of $3.00 per share. Trading in our
common stock will remain halted until we have satisfied Nasdaq's request for
additional information primarily regarding accounting issues identified in our
press release dated August 22, 2000. Nasdaq also indicated that it would delist
our common stock from trading on the Nasdaq National Market at the opening of
business on September 1, 2000, because of our failure to timely file our June
30, 2000 Form 10-Q, unless we appealed Nasdaq's decision. We timely requested an
appeal, and appeared at a hearing before the Nasdaq Listing Qualifications Panel
on September 22, 2000. The Listing Qualifications Panel stated that if Phoenix
failed to file its restated financial results and required periodic reports on
or before October 20, 2000, then our common stock would be delisted at that
time. We are fully cooperating with Nasdaq and do not expect that the
restatement of our financial statements will impact our ability to maintain
compliance with Nasdaq's quantitative listing requirements.

         Any delisting by Nasdaq would likely have an adverse and material
effect on the price of our common stock and on the ability of our shareholders
to sell their shares. Such delisting could also adversely affect our ability to
obtain additional debt or equity financing and may result in a reduction in the
amount and quality of security analysts' and news media's coverage of our
business operations. There can be no assurance that our actions will be
successful to maintain listing on the Nasdaq National Market.

WORKFORCE REDUCTION AND REORGANIZATION OF OPERATIONS

         On May 11, 2000, we initiated a cost reduction measure by eliminating
open positions and terminating approximately 15% of our existing workforce. The
cost of salaries and



                                       23
<PAGE>   24

employee benefits for the terminated employees was approximately $3.5 million on
an annualized basis. Severance-related expenses in connection with these
terminations was approximately $200,000. Following this workforce reduction, the
announcement of the restatement of our financial results, and the trading halt
imposed by Nasdaq, Phoenix has experienced higher than normal attrition in its
employee base.

         As of September 30, Phoenix had 275 employees and contract workers, of
which 99 were engaged in research and development (including research projects
and project development), 64 in U.S. sales, implementation, training and
support, 85 in international sales, implementation, training and support, 2 in
corporate marketing, 18 in finance and administration, and 7 in executive
management. This represents a significant reduction in staff since the end of
1999 in all areas including sales, development, and support. Phoenix has also
given notice to Siemens Australia to reduce the number of development
contractors by an additional 17 before the end of the year. Phoenix is not
currently hiring additional employees or expanding its sales or operations. All
of our executive officers, other than William Zayas and Gregory Blalack who
joined us in 2000, have employment agreements with Phoenix.

         In the third quarter of 2000, Phoenix moved most of its Orlando
operations into one building, and is currently seeking a sublessee for a portion
of its second, smaller facility there. In addition, Phoenix intends to relocate
its UK operations to a serviced office, and is currently in negotiations to
sublease its UK facilities to a third party.

TENDER OFFER

         In October, Phoenix learned that a mini-tender offer for 400,000 shares
of Phoenix stock at a cash price of $.50 per share, less distributions after
September 7, 2000, was commenced by Sutter Opportunity Fund 2, LLC ("Sutter").
Phoenix recommended to its shareholders that they reject this mini-tender offer
for following reasons:

-        By structuring its offer to acquire less than 5% of Phoenix's stock,
Sutter's offer falls in the category of mini-tender offers that are exempt from
the filing, disclosure and procedural requirement of Section 14(d) of the
Securities Exchange Act of 1934 and Regulation 14D adopted by the SEC. The
disclosure and procedural requirements of Section 14(d) and Regulation 14D are
designed to provide protections to shareholders who receive a tender offer.
However, in connection with the Sutter mini-tender offer, Phoenix shareholders
will not receive those protections. The U.S. Securities and Exchange Commission
has issued an investor alert regarding mini-tender offers, which can be accessed
at the SEC's web site at www.sec.gov/consumer/keyword/tminiten.html. Among other
things, the SEC recommends that before accepting such mini-tender offers,
shareholders should determine the market price, determine the tender price,
consult with their broker or financial advisor and determine where to get the
best price if they want to sell. The SEC warns investors not to assume that a
premium over fair value is being offered for their shares.

-        The Sutter offer was made on a "First-Come, First-Buy Basis," which
tends to pressure shareholders to make a quick investment decision. If more than
400,000 shares should be tendered to Sutter, only those shareholders who
responded most quickly would get to sell their shares to Sutter. Phoenix has
entered into an exclusivity agreement with London Bridge



                                       24
<PAGE>   25

Software Holdings plc. This exclusivity agreement has been extended to October
31, 2000. Phoenix and London Bridge agreed to negotiate in good faith with
respect to the execution by that date of a definitive agreement providing for
the acquisition of Phoenix by London Bridge and the extension by London Bridge
of a working capital line of credit of up to $10 million for interim financing.
Shareholders who tender prior to any public announcement of the execution of an
agreement or the termination of negotiations will be making an investment
decision without the benefit of knowing whether or not a definitive agreement
had been executed or the price and terms that would apply to London Bridge's
acquisition should be a definitive agreement be executed and consummated.

-        The price offered by Sutter, $.50 per share less distributions after
September 7, 2000, is less than the $3.00 per share trading price of Phoenix
stock on August 23, 2000, the date on which Nasdaq trading in Phoenix stock was
halted. Further, the Sutter offer states that tenders of shares made pursuant to
the offer are irrevocable (i.e., there are no withdrawal rights) unless the
offer is amended (other than to increase the offer price or the number of shares
that Sutter is willing to purchase) or extended beyond November 17, 2000.
Although Nasdaq may not allow trading in Phoenix stock to resume in the future,
Phoenix has requested that Nasdaq allow trading to be resumed. Phoenix does not
know the prices at which Phoenix stock would trade should Nasdaq trading be
resumed. However, if trading occurred at a price higher than Sutter's offer
prior to the expiration of Sutter's offer, shareholders who had tendered their
shares to Sutter could not then withdraw their shares and thus could not sell
their shares in the Nasdaq market (unless the offer is amended or extended as
described above).

CHANGES IN BUSINESS

         Downturn in Sales. Phoenix has closed 8 new contracts for the provision
of its core banking solution in the first 9 months of 2000, as compared to 13 in
the first 9 months of 1999, and 29 in the first 9 months of 1998.
We believe that the downturn in sales is attributable to:

         -        negative publicity from the purported class action lawsuit
                  described in "Item 3 - Legal Proceedings",
         -        negative postings on Phoenix's Yahoo! chat board,
         -        a slower than anticipated return to normal sales activity
                  following the year 2000 related downturn,
         -        prospect concerns about Phoenix's viability due to its recent
                  losses and decreasing capital reserves,
         -        the announced restatement of Phoenix's financials results, and
         -        the trading halt imposed by Nasdaq.

         ASC Centers. Only one new bank has been added to Phoenix's ASC centers
in 2000, and Phoenix does not anticipate that it will open any new centers in
2000, and no new centers are currently planned.

         Capital Resources. As described above, the events that depressed our
results of operations in 1999 have continued. Since December 31, 1999, sales are
down significantly and Phoenix has continued to lose money and use cash. At
September 30, 2000, Phoenix had



                                       25
<PAGE>   26
approximately $4.1 million of cash and marketable investment securities. If
Phoenix does not complete the potential transaction with London Bridge or
otherwise identify new sources of capital funding, Phoenix may not have
sufficient capital resources to fund its operations through the end of the year
without significantly cutting back its operations and expenses. As a result,
Phoenix has included a "going concern" note to its 1999 annual financial
statements and Phoenix's auditors have included a "going concern" modification
in their audit opinion of the 1999 annual financial statements.

         OCC. Our customers are being asked by the Office of the Comptroller of
the Currency to prepare contingency plans for replacing Phoenix as a vendor.

         Project Aurora. Due to lack of funding and employee attrition, Phoenix
has curtailed its development of its future upgrade identified as project
Aurora. Phoenix has written off the costs of this project which were previously
capitalized. The continuation and fruition of this project are currently at
significant risk.

         Professional Fees. Phoenix has incurred substantial professional fees
in relation to the defense of the class action lawsuit, the restatement of
Phoenix's financial results, and the negotiations with London Bridge. The
cumulative total of such fees is expected to exceed $2 million.

         New Software Releases. In February of 2000, Phoenix released version
2.5 of its EIS system. In June of 2000, Phoenix released version I 2.0.5 of the
international code line of the Phoenix core banking system. In October of 2000,
Phoenix released version 3.0 YE of its U.S. core banking system and Phoenix
International A.P. released version 3.6 of the Phoenix Trade Finance System.
Each of these new releases includes significant new functionality, new features,
and fixes for a significant number of previously identified bugs.

         New Marketing Partner in The Philippines. On March 31, 1999, Phoenix
entered into a new Cooperative Marketing agreement with Computer Data Vision,
Inc. (CDVI), pursuant to which Phoenix granted CDVI non-exclusive marketing
rights to Phoenix's products in The Philippines. CDVI brings significant
experience in the financial software area and is already working with two
customers in the region.

         Revision of Marketing Agreement with Towne Services, Inc. On June 28,
2000, Phoenix modified its marketing arrangement for software from Towne
Services, Inc. In exchange for $365,000, Phoenix agreed to convert its exclusive
marketing rights for TSI's Collection Works product into non-exclusive rights.
Further, TSI paid Phoenix a total of $175,000 in consideration of the sale of
exclusive marketing rights to such product to an entity in The Philippines.
Phoenix retained non-exclusive rights to market the TSI product on revised
terms.

         Regency Systems, Inc. Telephone Banking System. In May of 2000, Phoenix
entered into an agreement with Regency Systems, Inc. pursuant to which Regency
granted Phoenix rights to market Regency's telephone banking system to Phoenix
customers. Additionally, Regency agreed to replace the Phoenix telephone banking
system for Phoenix customers at no



                                       26
<PAGE>   27

charge (other than one or two days worth of on site implementation fees), and to
provide support for such system at the rates previously agreed with Phoenix for
the Phoenix system.

         Relocation of Miami Application Service Center. In March of 2000,
Phoenix successfully relocated its Florida based Application Service Center
previously acquired from ERAS JV from Miami to its main offices in Orlando.

         E-commerce. In March of 2000, Phoenix entered into a marketing
arrangement with Stockwalk.com, Inc., pursuant to which Phoenix will integrate
Stockwalk.com's online brokerage services with Phoenix's Internet banking
products, allowing Phoenix's financial institution clients to offer their
customers seamless retail banking and co-branded online brokerage services. In
compliance with applicable rules and regulations, all brokerage services will be
provided and controlled directly by Stockwalk.com.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K


     a)   Exhibits

<TABLE>
<CAPTION>
Exhibit
No.            Description
-------        -----------
<S>            <C>
3.1            Amended and Restated Articles of Incorporation, as amended by the
               Articles of Amendment to Amended and Restated Articles of
               Incorporation as filed with the Secretary of the State of Florida
               on May 28, 1997 (incorporated by reference to Exhibit 3.1 of our
               Registration Statement on Form S-1 (No. 333-31415) as declared
               effective by the SEC on August 13, 1997 (the "Registration
               Statement")).

3.2            Amended and Restated Bylaws, effective July 8, 1996 (incorporated
               by reference to Exhibit 3.2 of Phoenix's Form 10-Q, dated August
               14, 1996, for the Quarter ended June 30, 1996 (File No.
               0-20937)).

4.1            See Exhibits 3.1 and 3.2 for provisions of the Amended and
               Restated Articles of Incorporation and Amended and Restated
               Bylaws defining the rights of the holders of Common Stock of
               Phoenix (incorporated by reference to Exhibit 4.1 of the
               Registration Statement).

10.1           Marketing Agreement between London Bridge Software Limited and
               Phoenix International Ltd., Inc. (incorporated by reference to
               Exhibit 10-1 of Phoenix's Form 10-Q, dated May 15, 2000, for the
               Quarter ended March 31, 2000 (File No. 0-20937)).

27.1           Financial Data Schedule for the three months ended March 31, 2000
               (for SEC use only).

</TABLE>

     b)   Reports on Form 8-K

         None.

                                       27
<PAGE>   28

                                   SIGNATURES

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


                              PHOENIX INTERNATIONAL LTD., INC.

<TABLE>
<S>                           <C>
                              /s/Bahram Yusefzadeh
                              --------------------------------------------------
October 24, 2000              Bahram Yusefzadeh

                              Chairman of the Board and Chief Executive Officer
                              (principal executive officer)

                              /s/Theodore C. Burns
                              -------------------------------------------------
October 24, 2000              Theodore C.  Burns
                              Senior Vice President and Chief Financial Officer
                              (principal financial and accounting officer)
</TABLE>


                                       28
<PAGE>   29

                                  EXHIBIT INDEX

<TABLE>

<CAPTION>
Exhibit
  No.          Description
-------        -----------

<S>            <C>
3.1            Amended and Restated Articles of Incorporation, as amended by the
               Articles of Amendment to Amended and Restated Articles of
               Incorporation as filed with the Secretary of the State of Florida
               on May 28, 1997 (incorporated by reference to Exhibit 3.1 of
               Phoenix's Registration Statement on Form S-1 (No. 333-31415) as
               declared effective by the SEC on August 13, 1997 (the
               "Registration Statement")).

3.2            Amended and Restated Bylaws, effective July 8, 1996 (incorporated
               by reference to Exhibit 3.2 of Phoenix's Form 10-Q, dated August
               14, 1996, for the Quarter ended June 30, 1996 (File No.
               0-20937)).

4.1            See Exhibits 3.1 and 3.2 for provisions of the Amended and
               Restated Articles of Incorporation and Amended and Restated
               Bylaws defining the rights of the holders of Common Stock of
               Phoenix (incorporated by reference to Exhibit 4.1 of Registration
               Statement).

10.1           Marketing Agreement between London Bridge Software Limited and
               Phoenix International Ltd., Inc. (incorporated by reference to
               Exhibit 10-1 of Phoenix's Form 10-Q, dated May 15, 2000, for the
               Quarter ended March 31, 2000 (File No. 0-20937)).

27.1           Financial Data Schedule for the three months ended September 30,
               1999 (for SEC use only).
</TABLE>


                                       29