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**SECURITIESAND EXCHANGE COMMISSION****Washington, D.C. 20549**

**FORM10-Q**
| **ý** | **QUARTERLY REPORT PURSUANT TO SECTION 13 OR  15(d) OF THE SECURITIES EXCHANGE ACT OF 1934** |
|------------|----------------------------------------------------------------------------------------------|

**For the quarterly period endedJune 30, 2001**

**or,**
| **o** | **TRANSITION REPORT PURSUANT TO SECTION 13 OR  15(d) OF THE SECURITIES EXCHANGE ACT OF 1934** |
|-------|-----------------------------------------------------------------------------------------------|

**From the transition periodfrom                     to**

**Commission file number 0-27012**

**InsigniaSolutions plc****(Exact name of Registrant as specified in its charter)**
| **England and Wales**                                           | **Not applicable**                       |
|-----------------------------------------------------------------|------------------------------------------|
| (State or other  jurisdiction of incorporation or organization) | (I.R.S. employer  identification number) |

 

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| **41300 Christy Street  Fremont**            | **The Mercury Centre, Wycombe Lane  Wooburn Green** |
|----------------------------------------------|-----------------------------------------------------|
| **California 94538**                         | **High Wycombe, Bucks HP10 0HH**                    |
| **United States of America  (510) 360-3700** | **United Kingdom  (44) 1628-539500**                |

**(Address and telephone numberof principal executive offices and principal places of business)**

Indicate by check mark whether theregistrant: (1) has filed all reports required to be filed by Section 13 or15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (orfor 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  ý   No  o

As of August 6, 2001, there were19,484,366 Ordinary shares of £0.20 each nominal value, outstanding.

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**INSIGNIA SOLUTIONS PLC**

|                            | **PART  1 - FINANCIAL INFORMATION**                                                                                           |
|---------------------------------|-------------------------------------------------------------------------------------------------------------------------------|
|                            |                                                                                                                          |
| **Item 1.**                     | **Financial Statements:**                                                                                                     |
|                            |                                                                                                                          |
|                            | Condensed  Consolidated Balance Sheet at June 30, 2001 and December 31, 2000 (Unaudited)                                      |
|                            |                                                                                                                          |
|                            | Condensed  Consolidated Statement of Operations for the three months and six months  ended June 30, 2001 and 2000 (Unaudited) |
|                            |                                                                                                                          |
|                            | Condensed  Consolidated Statement of Cash Flows for the six months ended June 30, 2001  and 2000 (Unaudited)                  |
|                            |                                                                                                                          |
|                            | Notes to  Unaudited Condensed Consolidated Financial Statements                                                               |
|                            |                                                                                                                          |
| **Item  2.**                    | **Management’s  Discussion and Analysis of Financial Condition and Results of Operations**                               |
|                            |                                                                                                                          |
| **Item  3.**                    | **Quantitative  and Qualitative Disclosures About Market Risk**                                                               |
|                            |                                                                                                                          |
| **PART II - OTHER INFORMATION** |
|                            |                                                                                                                          |
| **Item  4.**                    | **Submission  of Matters to a Vote of Security Holders**                                                                      |
|                            |                                                                                                                          |
| **Item 6.**                     | **Exhibits and  Reports on Form 8-K**                                                                                         |
|                            |                                                                                                                          |
| **Signatures**                  |

 

**PART I - FINANCIAL INFORMATION**

**Item 1.  FinancialStatements**

**INSIGNIASOLUTIONS PLCCONDENSED CONSOLIDATED BALANCE SHEET(amounts in thousands, unaudited)**

|                                      | June 30,  2001                                                        |    | December 31,  2000 |    |
|-------------------------------------------|-----------------------------------------------------------------------|---------|--------------------|---------|
|                                      |                                                                       |    |                    |    |
| **ASSETS**                                |                                                                  |    |               |    |
|                                      |                                                                  |    |               |    |
| Current assets:                           |                                                                  |    |               |    |
|                                      | Cash and cash equivalents                                             | $       | 12,220             |    | $ | 12,051 |   |
|                                      | Accounts receivable, net of allowances of $161 and $42,  respectively | 10,510  |               | 3,385   |   |
|                                      | Prepaid and other current assets                                      | 1,974   |               | 1,088   |   |
|                                      |                                                                  |         |               |         |   |
|                                      | Total current assets                                                  | 24,704  |               | 16,524  |   |
|                                      |                                                                  |    |               |    |
| Property and equipment, net               | 445                                                                   |    | 512                |    |
| Cash and cash equivalents held in escrow  | -                                                                     |    | 5,050              |    |
| Restricted cash                           | 250                                                                   |    | 250                |    |
| Other non-current assets                  | 100                                                                   |    | -                  |    |
|                                      |                                                                       |    |                    |    |
|                                      | $                                                                     | 25,499  |               | $       | 22,336 |   |
|                                      |                                                                       |    |                    |    |
| **LIABILITIES AND  SHAREHOLDERS' EQUITY** |                                                                  |    |               |    |
| Current liabilities:                      |                                                                  |    |               |    |
|                                      | Accounts payable                                                      | $       | 636                |    | $ | 1,096 |   |
|                                      | Accrued liabilities                                                   | 1,079   |               | 1,833   |   |
|                                      | Accrued royalties                                                     | 206     |               | 770     |   |
|                                      | Income taxes payable                                                  | 394     |               | 550     |   |
|                                      | Deferred revenue                                                      | 6,993   |               | 898     |   |
|                                      |                                                                  |         |               |         |   |
|                                      | Total current liabilities                                             | 9,308   |               | 5,147   |   |
|                                      |                                                                       |    |                    |    |
| Contingencies (Note 6)                    |                                                                  |    |               |    |
|                                      |                                                                  |    |               |    |
| Mandatorily redeemable warrants           | 1,440                                                                 |    | 1,440              |    |
|                                      |                                                                       |    |                    |    |
| Shareholders’ equity:                |                                                                  |    |               |    |
|                                      | Ordinary shares                                                       | 6,257   |               | 5,876   |   |
|                                      | Additional paid-in capital                                            | 58,830  |               | 54,117  |   |
|                                      | Accumulated deficit                                                   | (49,875 | )                  | (43,783 | ) |
|                                      | Other accumulated comprehensive loss                                  | (461    | )                  | (461    | ) |
|                                      |                                                                  |         |               |         |   |
|                                      | Total shareholders’ equity                                       | 14,751  |               | 15,749  |   |
|                                      |                                                                       |    |                    |    |
|                                      | $                                                                     | 25,499  |               | $       | 22,336 |   |
|                                      |                                                                       |    |                    |    |
|                                           |                                                                       |         |                    |         |  |  |  |  |

Theaccompanying notes are an integral part of these consolidated financialstatements.
**INSIGNIASOLUTIONS PLCCONDENSED CONSOLIDATED STATEMENT OF OPERATIONS(amounts in thousands, except per share amounts, unaudited)**
 Three months ended  June 30, Six months ended  June 30,     2001 2000 2001 2000      Net revenues:         License$2,684 $2,574 $3,765 $3,817  Service394 477 1,009 745       Total net revenues3,078 3,051 4,774 4,562      Cost of net revenues:         License1,363 655 1,974 1,225  Service85 78 269 269       Total cost of net revenues1,448 733 2,243 1,494       Gross margin1,630 2,318 2,531 3,068      Operating expenses:         Sales and marketing1,815 1,168 3,546 2,460  Research and development1,589 1,554 3,183 3,008  General and administrative948 924 2,199 1,869       Total operating expenses4,352 3,646 8,928 7,337       Operating loss(2,722)(1,328)(6,397)(4,269)         Interest income (expense), net115 114 339 (106)Other income (expense), net(5)16 26 24       Loss before income taxes(2,612)(1,198)(6,032)(4,351)         Provision (benefit) for income taxes60 (596)60 (591)      Net loss$(2,672)$(602)$(6,092)$(3,760)     Net loss per share:         Basic$(0.14)$(0.04)$(0.32)$(0.27)       Diluted$(0.14)$(0.04)$(0.32)$(0.27)     Weighted average shares and share equivalents:         Basic19,349 14,201 19,004 14,145        Diluted19,349 14,201 19,004 14,145       
Theaccompanying notes are an integral part of these consolidated financialstatements.****INSIGNIASOLUTIONS PLCCONDENSED CONSOLIDATEDSTATEMENT OF CASH FLOWS(amounts in thousands, unaudited)**
 Six  months ended  June 30,    2001 2000    Cash flows from  operating activities:     Net loss$(6,092)$(3,760) Adjustments to reconcile net loss to net cash used in operating  activities: ** ** ** ** Depreciation173 221  Other4 (42) Net changes in assets  and liabilities:     Accounts receivable,  net(7,125)(2,189) Prepaid and other  current assets(886)101  Other non-current  assets(100)-  Accounts payable(460)69  Accrued liabilities(754)(62) Accrued royalties(564)(449) Deferred revenue6,095 (671) Income taxes(156)581     Net cash used in  operating activities(9,865)(6,201)   Cash flows from  investing activities:     Proceeds from sale of  property and equipment- 3  Purchases of property  and equipment(109)(147) Product line sale  proceeds held in escrow- 140  Product line sale  proceeds released from escrow5,050 1,000     Net cash provided by  investing activities4,941 996    Cash flows from  financing activities:     Proceeds from  short-term debt- 1,000  Proceeds from issuance  of shares, net4,967 458  Proceeds from exercise  of stock options126 -     Net cash provided by  financing activities5,093 1,458    Net increase  (decrease) in cash and cash equivalents169 (3,747)Cash and cash equivalents  at beginning of the period12,051 4,677    Cash and cash  equivalents at end of the period$12,220 $930    
Theaccompanying notes are an integral part of these consolidated financialstatements.****INSIGNIA SOLUTIONS PLC**

**NOTES TO UNAUDITED CONDENSEDCONSOLIDATED****FINANCIAL STATEMENTS**

**Note 1.  Basis ofpresentation**

The condensed consolidated financialstatements are unaudited.  However, inthe opinion of management, all adjustments (consisting only of normal recurringadjustments) which are necessary for a fair presentation of the financialposition and results for the interim period have been included.

The results of operations for the threemonths and six months ended June 30, 2001 are not necessarily indicative of theresults to be expected for the entire fiscal year, which ends on December 31,2001.

These unaudited condensed consolidatedfinancial statements should be read in conjunction with the financialstatements and notes thereto for the year ended December 31, 2000 included in InsigniaSolutions plc’s (“Insignia”) 2000 Annual Report and Form 10-K/A.

**Note 2.  Income taxes**

Insignia accounts for income taxes underan asset and liability approach that requires the recognition of deferred taxassets and liabilities for the expected future tax consequences of events thathave been recognized in Insignia’s financial statements or tax returns.  In estimating future tax consequences,Insignia generally considers all expected future events other than enactmentsof changes in the tax law or rates.

**Note 3.  Net income(loss) per share**

Basic net income (loss) per share iscomputed using the weighted average number of ordinary shares outstandingduring the period.  Diluted net income(loss) per share is computed using the weighted average number of ordinaryshares and ordinary share equivalents outstanding during the period.  Ordinary equivalent shares consist ofwarrants and stock options (using the treasury stock method).  Ordinary equivalent shares are excluded fromthe computation, if their effect is antidilutive.
Statementregarding computation of loss per share (in thousands except per share data,unaudited):
 Three months ended  June 30, Six months ended  June 30,     2001 2000 2001 2000      Net loss$(2,672)$(602)$(6,092)$(3,760)     Calculation of basic loss per share:        Weighted average number of ordinary shares outstanding used in  computation19,349 14,201 19,004 14,145      Basic loss per share$(0.14)$(0.04)$(0.32)$(0.27)     Calculation of diluted loss per share:        Weighted average number of ordinary shares outstanding used in  computation19,349 14,201 19,004 14,145 Net effect of dilutive stock options outstanding- - - -       19,349 14,201 19,004 14,145      Diluted loss per share$(0.14)$(0.04)$(0.32)$(0.27)     
**Note 4.  Comprehensiveincome (loss)**

Statement of Financial Accounting StandardsNo. 130, “Reporting Comprehensive Income” (“FAS 130”) requires that all itemsrecognized under accounting standards as components of comprehensive earningsbe reported in an annual statement that is displayed with the same prominenceas other annual financial statements. FAS 130 also requires that an entity classify items of othercomprehensive earnings by their nature in an annual financial statement.  Comprehensive  income, as defined, includes all changes in equity during aperiod from non-owner sources.

Total comprehensive loss was notdifferent from the net loss reported for the three and six months ended June30, 2001.

**Note 5.  Newaccounting pronouncements**

In September 1998, the FinancialAccounting Standards Board issued Statement of Financial Accounting StandardNo. 133 “Accounting for Derivative Instruments and Hedging Activities” (“SFAS133”). SFAS 133 establishes accounting and reporting standards for derivativeinstruments and for hedging activities. This statement became effective for all fiscal quarters of fiscal yearsbeginning after June 15, 1999.  In June1999, the FASB issued Statement of Financial Accounting Standard No. 137"Accounting for Derivative Instruments – Deferral of the Effect Date ofSFAS Statement No. 133” (“SFAS 137”).  SFAS137 deferred the effective date of SFAS 133 until June 15, 2000.  Insignia adopted SFAS 133 in 2001.  The adoption of SFAS 133 did not affect theresults of operations.****Note 6.  Contingencies**

On October 4, 1999, Insignia filed suitagainst Citrix Systems Inc. (“Citrix”) and GraphOn Corporation (“GraphOn”) inthe Superior Court of the State of California, County of Santa Clara, relatingto the misappropriation assertions of GraphOn and Citrix’s refusal to releasefunds still remaining in escrow and breach of a Cooperation Agreement betweenInsignia and Citrix. On March 15, 2000, GraphOn filed a suit against Citrix andInsignia in the Superior Court of the State of California, County of SantaClara, alleging trade secret misappropriation and breach of contract arisingout of the same facts and circumstances set forth in Insignia’s action againstGraphOn.  The two cases wereconsolidated.

This case was settled out of court on April 5, 2001.  The settlement did not involve any paymenton the GraphOn claims against Insignia and the balance of an escrow account,$4.9 million, was released to Insignia on April 20, 2001.

**Note 7.  Segmentinformation**

Statement of Financial AccountingStandards 131, “Disclosures about Segments of an Enterprise and RelatedInformation” (“SFAS 131”), provides for segment reporting based upon the“management” approach.  The managementapproach designates the internal organization that is used by management formaking operating decisions and assessing performance as the source of Insignia’sreportable segments.  SFAS 131 alsorequires disclosures about products and services, geographic areas, and majorcustomers.

Insignia operates in a single industrysegment providing virtual machine technology which enables softwareapplications and operating systems to be run on various computerplatforms.  In the second quarter of2001, Phoenix Technologies, Ltd. (“Phoenix Technology”) and Toshiba InformationSystems Corporation (“Toshiba”) accounted for 66% and 12% of total revenues,respectively.  In the second quarter of2000, Quantum Corporation (“Quantum”), Index Systems Inc., a subsidiary ofGemstar International Group Limited (“Gemstar”), and Victor Data SystemsCompany, Ltd. (“VDS”) accounted for 35%, 25% and 11% of total revenues,respectively.   No other customeraccounted for 10% or more of Insignia's total revenues during the secondquarter of 2001 and 2000.****Geographic information**

Financial information by geographicalregion is summarized below (in thousands):
 Three months ended  June 30, Six months ended  June 30,     2001 2000 2001 2000      Revenues  from unaffiliated customers:         United  States$2,991 $3,020 $4,484 $4,531  International87 31 290 31       Consolidated$3,078 $3,051 $4,774 $4,562      Intercompany  revenues:         United  States$70 $- $233 $-  International1,228 1,148 1,928 1,661       Consolidated$1,298 $1,148 $2,161 $1,661      Operating  loss:         United  States$(1,547)$(97)$(3,456)$(985) International(1,175)(1,231)(2,941)(3,284)      Consolidated$(2,722)$(1,328)$(6,397)$(4,269)     
 
 June 30,    2001 2000    Identifiable  assets:     United  States$18,467 $3,296  International40,301 23,903  Intercompany  items and eliminations(33,269)(16,511)   Consolidated$25,499 $10,688    Long-lived  assets:     United  States$455 $400  International33,609 22,434  Intercompany  items and eliminations(33,269)(16,511)   Consolidated$795 $6,323    
All of the international revenues andsubstantially all of the international identifiable assets relate to Insignia'soperations in the United Kingdom. Intercompany sales are accounted for at prices intended to approximatethose that would be charged to unaffiliated customers.

Financial information by line of productis summarized below (in thousands):
 Three  months ended  June 30, Six  months ended  June 30,     2001 2000 2001 2000      Jeode$3,078 $2,933 $4,774 $4,406 SoftWindows- 118 - 156       Total$3,078 $3,051 $4,774 $4,562      
Revenues from United States operationsincluded export sales of $408,000 and $351,000 for the three months ended June30, 2001 and 2000, respectively, and $638,000 and $454,000 for the six monthsended June 30, 2001 and 2000, respectively.
Revenue by geographic area for thequarter ended June 30, 2001 is as follows (in thousands):
 U.S. U.S.  Exports Europe Total      OEM$549 $- $87 $636 Distributor2,034 408 - 2,442 End User- - - -      Total$2,583 $408 $87 $3,078      Percentage  of total revenue84%13%3%100%     
Revenue by geographic area for thequarter ended June 30, 2000 is as follows (in thousands):
 U.S. U.S.  Exports Europe Total      OEM$2,426 $350 $- $2,776 Distributor174 1 - 175 End User69 - 31 100      Total$2,669 $351 $31 $3,051      Percentage  of total revenue87%12%1%100%     
There were no European countries thataccounted for more than 10% of total revenue.

**Note 8.  Privateplacement and warrants**

In December 1999, Insignia entered intoagreements whereby Insignia issued 1,063,515 Ordinary Shares in ADS form,bundled with warrants, at a price of $4.23 per share to Castle Creek TechnologyPartners LLC and four other investors of whom one is a member of Insignia’sboard of directors.  The bundledwarrants give the investors the right to purchase a total of 319,054 ADSs at anexercise price of $5.29 per ADS.  Thewarrants expire on December 9, 2004. Insignia received $4.5 million less offering expenses totaling $0.4million.  The securities were issued byInsignia in reliance upon the exemption from registration provided under Rule506 of Regulation D promulgated under the Securities Act to accreditedinvestors in a transaction not involving any public offering.

During 2000, Insignia issued a total of19,994 Ordinary Shares in ADS form at various prices, ranging from $6.281 to$16.50 to a director of Insignia, as payment for drawdown fees under a Line ofCredit arrangement entered into in March 2000. The securities were issued in reliance upon the exemption fromregistration provided under Section 4(2) of the Securities Act.
On November 24, 2000 Insignia enteredinto agreements whereby Insignia issued 3,600,000 Ordinary Shares in ADS form,bundled with warrants, at a price of $5.00 per share to a total of 23investors, including Sun Microsystems, BSquare, and a member of Insignia’sboard of directors.  The bundledwarrants give the investors the right to purchase 1,800,000 ADSs at an exerciseprice of the lower of the average quoted closing sale price of Insignia’s ADSsfor the ten trading days ending on the day preceding the date of the warrantholder’s intent to exercise less a 10% discount, and $6.00.  In the second quarter of 2001, threeinvestors exercised their warrant rights on 282,500 warrants. The warrantsexpire on November 24, 2003, however, subject to certain conditions, if thequoted sale price of the ADSs exceed $9.00 per share for any thirty consecutivetrading days, Insignia may cancel the warrants upon sixty days prior writtennotice.  Insignia received $18.0 millionless offering expenses totaling $2.0 million. Insignia also issued a warrant to purchase 225,000 ADSs to the placementagent exercisable at a price of $5.00 per ADS. This warrant expires on November 24, 2005.  The securities were issued by Insignia in reliance upon theexemption from registration provided under Rule 506 of Regulation D promulgatedunder the Securities Act to accredited investors in a transaction not involvingany public offering.

On December 31, 2000 Insignia issued atotal of 251,333 Ordinary Shares in ADS form to Quantum Peripherals (Europe)SA, at a per share price of $4.23 per share under the terms of a convertiblepromissory note entered into on October 20, 1999.  The securities were issued in reliance upon the exemption fromregistration provided under Section 4 (2) of the Securities Act based on thefact that the shares were sold by the issuer in a sale not involving a publicoffering.

On February 12, 2001 Insignia enteredinto agreements whereby Insignia issued 940,000 Ordinary Shares in ADS form,bundled with warrants, at a price of $5.00 per share to a total of 4 investors,including Wind River Systems, Inc., and a member of Insignia’s board ofdirectors.  The bundled warrants gavethe investors the right to purchase 470,000 ADSs, at an exercise price of thelower of the average quoted closing sale price of Insignia’s ADS’s for the tentrading days ending on the day preceding the date of the warrant holder’sintent to exercise less a 10% discount, and $6.00.  The warrants expire on February 12, 2004, however, subject to certainconditions, if the quoted sale price of the ADSs exceed $9.00 per share for anythirty consecutive trading days, Insignia may cancel the warrants upon sixtydays prior written notice.  Insigniareceived $4.7 million less offering expenses totaling $0.5 million.  Insignia also issued a warrant to purchase25,000 ADSs to the placement agent exercisable at a price of $5.00 perADS.  This warrant expires on February12, 2006.  The securities were issued byInsignia in reliance upon the exemption from registration provided under Rule506 of Regulation D promulgated under the Securities Act to accreditedinvestors in a transaction not involving any public offering.

**Dilution Adjustments**

In December 1999, Insignia issued1,063,515 Ordinary Shares in ADS form at a price of $4.23 per share through aprivate placement.  Insignia received$4.5 million less offering expenses totaling $0.4 million.  Along with ADSs, Insignia also issued to theinvestors warrants that entitle them to purchase a total of 319,054 ADSs at anexercise price of $5.29 per ADS.  Asdescribed below, the exercise price and the number of ADSs issuable under thewarrants are subject to various adjustments.
Under the December 1999 privateplacement, the investors received warrants to purchase three ADSs for every 10ADSs they purchased.  The exercise priceof the warrants was set at 125% of the original per ADS purchase price, or$5.29.  However, the warrants contain anti-dilutionprovisions which decrease this exercise price and increase the number of ADSspurchasable if Insignia sells or is deemed to sell any shares at below marketprice during the term of the warrants, which ends on December 9, 2004.  The private placement that closed onNovember 24, 2000 was a sale which triggered the anti-dilution provisions inthe warrants, and, as a consequence, the exercise price of the warrants hasbeen decreased from $5.29 to $4.77 per ADS, and the number of ADSs purchasablehas increased to 353,834.  The privateplacement on February 12, 2001 also triggered the anti-dilution provisions ofthe issuance of December 9, 1999. However, the effect of such dilution was less than 1% of the exerciseprice and consequently such adjustment is deferred until such time as the accumulationof this adjustment and future adjustments exceed at least 1% of the exerciseprice.

As part of their warrant agreements, theinvestors may be entitled to cash payments upon the occurrence of certain MajorTransactions, as defined in the warrant agreements, including change of controlprovisions.  Cash payments aredetermined in a methodology described in the agreement.  Such methodology is impacted by marketprice.  A major transaction is definedas a merger, reorganization, or sale of all or substantially all of the assetsof Insignia in which the stockholders of Insignia immediately prior to thetransaction possess less than 50% of the voting power of the surviving entity(or its parent) immediately after the transaction.

Underthe December 1999 private placement, the investors were entitled to additionalwarrants to purchase ADSs at £0.20 nominal value per share if the average ofthe closing bid price of the ADSs over the ten days before an adjustment datewas less than $4.23.  The adjustment datescommenced on March 10, 2000 and occurred on the 10th of each monththrough March 10, 2001, inclusive.  Therights for an adjustment date to occur would terminate upon release of at least$4.75 million of the funds held in escrow by Citrix on December 9, 1999.  However, not enough of the funds held werereleased to trigger this termination. As calculated the average bid price of Insignia’s ADSs on all theadjustment dates exceeded $4.23 per share and consequently no adjustmentoccurred.  The adjustment rights havenow expired.

Insigniaobtained a third-party valuation to allocate fair value to amounts receivedfrom the private placement between the ADSs and the warrants.  In 1999 the amount allocated to mandatorilyredeemable warrants totaled $1.440 million, of which $0.590 million wasallocated to the warrant, and $0.850 million was allocated to the additionalwarrant.  Of the remaining net proceedsreceived, $2.619 million was allocated to mandatorily redeemable capital.  The $2.619 million of mandatorily redeemablecapital was reclassed, when the registration statement for the ADSs and theADSs underlying the warrants issued in the December 1999 private placement became  effective on March 28, 2000, of which $0.340 million wasclassified as Ordinary Shares and $2.279 million was classified as additionalpaid-in capital.

Amountsclassified as warrants will remain outside of shareholders’ equity for the lifeof the warrant or until they are exercised, whichever occurs first. Thisclassification reflects certain potential cash payments that may occur, shouldInsignia complete a major transaction, such as a takeover, during the life ofthe warrants. If a major transaction had occurred as of June 30, 2001, themaximum cash payout would have been $641,618 based on the estimatedBlack-Scholes value of the warrant.
Limitationsin the transaction agreements preclude these investors in question fromachieving certain levels of beneficial ownership.  The securities purchase agreement, the warrants and theadditional warrants contain the restriction that Insignia may not issue and aselling investor may not purchase, and the warrants and additional warrants maynot be exercised for any ADSs if doing so would cause such investor tobeneficially own more than 9.9% of the total ordinary shares in issue as determinedin accordance with Section 13(d) of the Securities Exchange Act of 1934.  Under the additional warrants, if suchinvestors are prohibited from exercising the additional warrant as a result ofthe 9.9% restriction, the selling investor may, at its option and in additionto its other rights under the securities purchase agreement and the warrant,retain the warrant or demand payment, in cash, from Insignia in an amount  calculated by  the  Black-Scholes  formulamultiplied  by the number of ADSs  for  which  the additionalwarrant was exercisable, without regard to any limits on exercise.  The restrictions on the levels of beneficialownership in these  documents do not,however, restrict  those investors  from exercising  the  warrants or additional warrants up to thoselimitations, selling ADSs to decrease their level of beneficial ownership, andexercising the warrants to receive additional ADSs.  This could result in additional dilution to the holders of Insignia’sADSs and a potential decrease in the price of the ADSs.

**Note 9.  Convertiblepromissory note**

On October 20, 1999, Insignia signed aconvertible promissory note in favor of Quantum Corporation (“Quantum”) for$1.0 million.  The note was convertibleat Quantum’s option to Insignia’s shares any time during the lifetime of thenote.  The initial conversion price was$4.28 per share with adjustment clauses for stock splits, reverse stock splitsand certain offerings.  As a result ofthe private placements in December 1999 (see note 8) this conversion price wasadjusted to $4.23 per share on December 9, 1999.  All unpaid principal and unpaid interest, accrued at 8% perannum, compounded quarterly, was converted to Ordinary Shares on December 31,2000.

**Note 10.  Line ofcredit**

On March 20, 2000, Insignia entered intoan agreement with a director and members of his family whereby they wouldprovide Insignia a $5.0 million line of credit with a commitment fee of fourpoints based upon the total amount of the line and drawdown/termination fee oftwo points for drawdown or termination. The interest rate on amounts drawn down was at prime plus 2% until June30, 2000 and thereafter at prime plus 4% per annum simple interest, payable incash at the repayment date.  Insigniadrew down a total of $3.0 million of the line of credit during 2000.  A total of 19,994 Ordinary Shares in ADSform were issued as payment for drawdown fees under the line of creditarrangement.  On November 27, 2000Insignia repaid this sum, along with all accrued interest and the terminationfee due.

**Note 11.  Relatedparty transaction**

During the three months and six monthsended June 30, 2001 and the twelve months ended December 31, 2000, Insigniarecognized revenue of $2,025,000, $2,050,000 and $310,000, respectively, fromPhoenix Technologies Ltd.  The CEO ofPhoenix Technologies Ltd. was also a director on Insignia’s Board of Directorsfrom March 1997 until March 2001.
During the three months and six monthsended June 30, 2001 and the three months ended December 31, 2000, Insignia recognizedrevenue of $95,000, $214,375 and $2.4 million, respectively, from Wind RiverSystems, Inc. (“Wind River”).  WindRiver participated in a private placement of equity in Insignia in February2001 on the same terms as the other three investors in the privateplacement.  Wind River paid theaggregate purchase price of $2 million for 400,000 ordinary shares representedby ADRs and warrants to purchase 200,000 ordinary shares represented by ADRs.   In addition, a Vice President of WindRiver, John C. Fogelin, was appointed to Insignia’s Board of Directors inJanuary 2001.
**Item 2.  Management’s Discussion and Analysis ofFinancial Condition and Results of Operations**

The following discussion and analysisshould be read in conjunction with the unaudited condensed consolidatedfinancial statements and notes thereto included in Part I - Item 1 of this Form10-Q and the “Management’s Discussion and Analysis of Financial Condition andResults of Operations” set forth in Insignia’s Form 10-K/A for the year endedDecember 31, 2000 (the “Form 10-K/A”).

**Future operating results**

This Form 10-Q contains forward lookingstatements.  These forward lookingstatements concern matters which include, but are not limited to, the revenuemodel and market for the Jeode product line, the features, benefits andadvantages of the Jeode platform, international sales, gross margins, theavailability of licenses to third-party proprietary rights, business and salesstrategies, matters relating to proprietary rights, competition, exchange ratefluctuations and Insignia’s liquidity and capital needs and other statementsregarding matters that are not historical are forward-looking statements.  These matters involve risks anduncertainties that could cause actual results to differ materially from thosein the forward looking statements.  Inaddition to the factors discussed above, among other factors that could causeactual results to differ materially are the following: the demand for the Jeodeplatform; the performance and functionality of Jeode; Insignia’s ability todeliver products on time, and market acceptance of new products or upgrades ofexisting products; the timing of, or delay in, large customer orders; continuedavailability of technology and intellectual property license rights; productlife cycles; quality control of products sold; competitive conditions in theindustry; economic conditions generally or in various geographic areas; and therisks listed from time to time in the reports that Insignia files with the U.S.Securities and Exchange Commission. There can be no assurance that Insignia will experience growth inrevenues and net income in any particular period when compared to priorperiods.  Any quarterly or annualshortfall in net revenues and/or net income from the levels expected bysecurities analysts and shareholders would result in a substantial decline inthe trading price of Insignia’s shares.

Insignia continues to face significantrisks associated with the successful execution of its new productstrategy.  These risks include, but arenot limited to continued technology and product development, introduction andmarket acceptance of new products, changes in the marketplace, liquidity,competition from existing and new competitors who may enter the marketplace andretention of key personnel.  Due to thegenerally long sales cycles associated with the Jeode platform, including alicensing process which usually takes as long as 6 to 9 months to complete,Insignia does not currently have accurate visibility of future order rates anddemand for its products generally. There can be no assurance that Jeode platform products will achievemarket acceptance.

Insignia has experienced operating lossesin each quarter since the second quarter of 1996.  To achieve profitability, Insignia will have to increase itsrevenue.  Insignia’s ability to increaserevenues depends upon the success of its Jeode product line.  Jeode has been available only since March1999 and it may not achieve market acceptance. If Insignia is unable to generate revenues from Jeode in the form ofdevelopment license fees, maintenance and support fees, commercial useroyalties and customer-funded engineering services, Insignia’s current revenuewill be insufficient to sustain its business.
The following table sets forth theunaudited condensed consolidated results of operations as a percentage of totalrevenues for the three and six month periods ended June 30, 2001 and 2000.
 Three  months ended  June 30, Six months  ended  June 30,     2001 2000 2001 2000      Net revenues:         License87.2%84.4%78.9%83.7% Service12.8%15.6%21.1%16.3%      Total net revenues100.0%100.0%100.0%100.0%     Cost of net revenues:         License44.3%21.5%41.4%26.9% Service2.7%2.5%5.6%5.9%      Total cost of net revenues47.0%24.0%47.0%32.8%      Gross margin53.0%76.0%53.0%67.2%     Operating expenses:         Sales and marketing59.0%38.3%74.3%53.9% Research and development51.6%50.9%66.6%65.9% General and administrative30.8%30.3%46.1%41.0%      Total operating expenses141.4%119.5%187.0%160.8%      Operating loss(88.4%)(43.5%)(134.0%)(93.6%)         Interest income (expense), net3.7%3.7%7.1%(2.3%)Other income (expense), net(0.2%)0.5%0.5%0.5%      Loss before income taxes(84.9%)(39.3%)(126.4%)(95.4%)         Provision (benefit) for income taxes1.9%(19.6%)1.2%(13.0%)      Net loss(86.8%)(19.7%)(127.6%)(82.4%)      
**Overview**

Insignia, which commenced operations in1986, develops, markets and supports software technologies that speed theadoption of Java-based individualized computing in Internet appliances andembedded devices.
In January 1998, Insignia announced itsintention to launch a new product line called the JeodeÔ platform, based on Insignia’sEmbedded Virtual Machine (“EVM”TM) technology. This followed a strategic review in late 1997 of Insignia’sbusiness.  Insignia also explored newmarkets that would take advantage of Insignia’s 15 years of emulation softwaredevelopment experience.  The Jeodeplatform is Insignia’s implementation of Sun Microsystems, Inc.’s (“Sun”) Java®technology tailored for Internet appliances and embedded devices.  It utilizes patent-pending intellectualproperty to provide these resource-constrained devices with high performance,fully-compatible Java applet and application support.   The product became available for sale in March 1999.  The Jeode platform is now the principalproduct line of Insignia and will be for the foreseeable future.  The Jeode product line revenue model isbased on original equipment manufacturer’s (“OEMs”) and channel partners’customer transactions.

Insignia’s principal product line in pastyears was SoftWindowsTM.  This productenabled Microsoft Windows (“Windows”®) applications to be run on most AppleComputer Inc. (“Apple”®) Macintosh computers and many UNIX workstations.  Revenues from this product line grew until1995, but declined significantly after that date, along with margins.  This was due to a declining demand for AppleMacintosh products and increased competition. Insignia also shipped RealPC, a low cost software product that allowedconsumers to play games and other applications designed for Intel-based PCs ontheir Power Macintosh computers.  Inearly 1999 Management took steps to discontinue these product lines, and onOctober 18, 1999, Insignia signed an exclusive licensing arrangement with FWBSoftware, LLC (“FWB”).  This arrangementallowed Insignia to focus exclusively on its Jeode platform business strategy.

**Revenues**
 Three  months ended  June 30, Six  months ended  June 30,     2001 2000 2001 2000         (in  thousands)   License revenue$2,684 $2,574 $3,765 $3,817 Service revenue394 477 1,009 745      Total net revenue$3,078 $3,051 $4,774 $4,562      
The Jeode product line was the primarybusiness of Insignia for the first quarter of 2001 and 2000.

Revenue from the Jeode product line isderived from four main sources: the sale of a development license, the sale ofannual maintenance and support contracts/services, a commercial use royaltybased on shipments of products that include Jeode technology, andcustomer-funded engineering activities. Insignia derived its SoftWindows revenues from the sale of packagedsoftware products and annual maintenance contracts, along with royaltiesreceived from bundling agreements with OEMs and customer-funded engineeringactivities under OEM contracts. Revenues from the sale of development licenses, packaged products androyalties received from OEMs are classified as license revenue, while revenuesfrom customer-funded engineering activities, training, and annual maintenancecontracts are classified as service revenue.
In the second quarter of 2001, total revenuesincreased by 1% compared to total revenues for the second quarter of 2000.  In the six months ended June 30, 2001, totalrevenues increased by 5% compared to total revenues for the first six months of2000.  The increase is primarily due tothe ramp up of the Jeode platform product line.  The Jeode platform is now the principal product of Insigniaaccounting for 100% of the total revenue for the three and six months endingJune 30, 2001.  The Jeode platformaccounted for 96% and 97% of total revenue for the three months and six monthsended June 30, 2000, respectively. Insignia believes adoption of the Jeode platform will continue toincrease.  However, due to revenue recognitionfactors, not all this growth will necessarily translate into revenue in theimmediate future.

License revenue and service revenueaccounted for 87% and 13%, respectively, of total revenues for the three monthsended  June 30, 2001.  For the six months ended June 30, 2001,license revenue and service revenue accounted for 79% and 21%,respectively.  For both the three monthsand six months ended June 30, 2000, license revenue and service revenueaccounted for 84% and 16%, respectively.

License revenue increased 4% in thesecond quarter of 2001 compared to license revenues in the second quarter of2000.  For the six months ended June 30,2001, license revenue decreased 1% compared to the same period in 2000.  Jeode license revenues for both the threemonths and six months ended June 30, 2001 accounted for 100% of total license revenues.Jeode license revenues for the three months and six months ended June 30, 2000accounted for 96% and 98%, respectively, of total license revenues.  SoftWindows license revenues accounted for0% of total license revenues for both the three months and six months endedJune 30, 2001.  SoftWindows licenserevenues for the three months and six months ended June 30, 2000 accounted for4% and 2% of total license revenues, respectively.

Service revenue in the second quarter of2001 was 17% lower than service revenue in the second quarter of 2000.  The second quarter of 2000 included severalquarters of deferred maintenance for one customer, which could not berecognized until their custom work had been delivered.  Excluding the prior quarters in the secondquarter of 2000, service revenue in the second quarter of 2001 was 24% higherthan service revenue in the second quarter of 2000.  Service revenue for the six months ended June 30, 2001 was 35%higher than service revenue for the same period in 2000 due to largeengineering projects in the first quarter of 2001 and Jeode supportcontracts.  Jeode service revenuesaccounted for 100% of total service revenues for both the three months and sixmonths ended June 30, 2001.  Jeodeservice revenues for the three months and six months ended June 30, 2000accounted for 95% and 91% of total service revenues, respectively.  SoftWindows service revenues for the threemonths and six months ended June 30, 2001 accounted for 0% of total servicerevenues.  SoftWindows service revenuesaccounted for 5% and 9%, respectively, of the service revenue for the threemonths and six months ended June 30, 2000.

Revenue from Insignia’s SoftWindowsproducts accounted for 0% of total revenue in both the three months and sixmonths ended June 30, 2001 compared to 4% and 3% of total revenues for the sameperiods ended June 30, 2000. The decline is a result of discontinuing theSoftWindows product line and launching the Jeode platform product line. TheSoftWindows revenue in the second quarter of 2000 was primarily from UNIX-basedmaintenance contracts that Insignia was under contract to service through thethird quarter of 2000.
Sales to distributors and OEM’srepresenting more than 10% of total revenue in each period accounted for thefollowing percentages of total revenue.
 Three months endedJune 30, Six months endedJune 30,     2001 2000 2001 2000 OEM’s:     Quantum* 35%* 30% Gemstar* 25%* 34% VDS* 11%* *  Motorola- - 11%-          All OEM’s:21%91%39%91%         Distributors:         Phoenix Technology66%* 43%*  Toshiba12%- * -          All Distributors:79%* 60%* 
* Less than10%

Sales to customers outside the UnitedStates, derived mainly from customers in Europe and Asia, representedapproximately 16% of total revenues in the three months ended June 30, 2001,13% of total revenues in the three months ended June 30, 2000, 19% of totalrevenues in the six months ended June 30, 2001 and 11% of total revenues in thesix months ended June 30, 2000. Insignia markets Jeode to Internet applianceand embedded device manufacturers in the United States, Europe and Japan.

**Cost of revenues and grossmargin**
 Three months endedJune 30, Six months endedJune 30,     2001 2000 2001 2000       (in thousands, except percentages)          Cost of license revenue$1,363 $655 $1,974 $1,225 Gross margin: license revenue49%75%48%68%         Cost of service revenue85 78 269 269 Gross margin: service revenue78%84%73%64%         Total cost of revenues$1,448 $733 $2,243 $1,494 Gross margins: total revenues53%76%53%67%
Cost of license revenue is mainlycomprised of royalties to third parties, along with the costs of documentation,duplication and packaging.  Cost ofservice revenue includes costs associated with customer-funded engineeringactivities and end-user support under maintenance contracts.
Insignia believes that the significantfactors affecting the Jeode platform gross margin include pricing of thedevelopment license, pricing of the unit usage and royalties to third partiessuch as Sun Microsystems, Inc. (“Sun”). In early 1999, Insignia signed a five-year agreement with Sun underwhich Sun established Insignia as an authorized Virtual Machine provider.  Under this agreement, Insignia will pay Suna per unit royalty on each Jeode platform-enabled Internet appliance or embeddeddevice shipped by Insignia’s customers, plus a royalty on all developmentlicenses put in place between Insignia and its customers.  License revenue gross margins in the quarterended June 30, 2001 were 49%, compared to 75% for the same period in 2000.  For the six months ended June 30, 2001,license revenue gross margins were 48% compared to 68% for the same period in2000.  The decrease is due to a largedeal with lower gross margin.

Gross margin for service revenue isimpacted by the level of and pricing terms of customer funded engineeringactivities, which can vary from customer to customer, from contract to contractand the level of maintenance contracts sold. Gross margin for service revenue decreased in the second quarter of 2001to 78% from 84% in the same period of 2000. For the six months ended June 30, 2001, service revenue gross marginswere 73% compared to 64% for the same period in 2000.  The increase is due to Jeode customer-funded engineeringactivities and maintenance agreements with favorable margins.  In the first quarter of 2000, the continuedsupport of existing SoftWindows contracts with no renewal revenue resulted inInsignia achieving lower service revenue gross margins.

**Operating expenses**
 Three months endedJune 30, Six months endedJune 30,     2001 2000 2001 2000       (in thousands, except percentages)          Sales and marketing$1,815 $1,168 $3,546 $2,460 Percentage of total revenues59%38%74%54%         Research and development$1,589 $1,554 $3,183 $3,008 Percentage of total revenues52%51%67%66%         General and administrative$948 $924 $2,199 $1,869 Percentage of total revenues31%30%46%41%
Sales and marketing expenses consistprimarily of personnel and related overhead costs, salesperson commissions,advertising and promotional expenses, and trade shows.  Sales and marketing expenses increased by55% in the quarter ended June 30, 2001 from the quarter ended June 30, 2000,and by 44% for the six months ended June 30, 2001 from the same period of2000.  The increase is primarily due toincreased personnel costs and new hires. Insignia anticipates a moderate increase in sales and marketing expensesin the next few quarters as Insignia continues to increase its marketing andsales organization for its Jeode product line. Insignia has established a direct sales force in the United States,Europe and Japan. Insignia has also developed relationships with strategicpartners to leverage the Jeode technology.

Research and development expenses consistprimarily of personnel costs, overhead costs relating to occupancy andequipment depreciation.  Research anddevelopment expenses rose by 2% and 6% in the three months and six months endedJune 30, 2001, respectively, over the same period in 2000 due to increasedpersonnel costs.  Research anddevelopment expenses are expected to increase moderately over the next severalquarters.  In accordance with Statementof Financial Accounting Standards No. 86, software development costs areexpensed as incurred until technological feasibility is established, afterwhich any additional costs are capitalized. In 2001 and 2000, no developmentexpenditures were capitalized, as there were no amounts that qualified forcapitalization.
General and administrative expensesconsist primarily of personnel and related overhead costs for finance, legal,information systems, human resources and general management. General andadministrative expenses increased by 3% in the three months ended June 30, 2001over the same period of 2000.  The threemonths ended March 31, 2001 included a large increase in expense as a result ofadjusting a debt reserve for a debt that was considered uncollectible.  However, the debt was collected in July 2001and the reserve was partially reversed in the three months ending June 30,2001.  Excluding the impact of thereserve adjustment, general and administrative expenses increased by 13% in thethree months ended June 30, 2001 over the same period of 2000, and by 12% forthe six months ended June 30, 2001 over the same period of 2000.  The increase is primarily due to increasedgeneral reserves for bad debt and recruiting fees for replacement hires.  General and administrative expenses areexpected to increase moderately over the next several quarters.

**Interest income (expense), net**
 Three months endedJune 30, Six months endedJune 30,     2001 2000 2001 2000       (in thousands, except percentages)          Interest income (expense), net$115 $114 $339 $(106)Percentage of total revenues4%4%7%(2%)
Interest income (expense), net increasedfrom $114,000 in the three months ended June 30, 2000 to $115,000 in the threemonths ended June 30, 2001.  Theincrease was primarily due to  increasedinterest income earned on Insignia’s cash and cash equivalents.  The three months ended March 31, 2000included a one time expense for a $300,000 commitment fee for the $5 millionline of credit secured in the first quarter of 2000.  The line of credit was repaid in the fourth quarter of 2000resulting in interest income only for the six months ended June 30, 2001. Interestincome, net increased from expense of $106,000 in the six months ended June 30,2000 to income of $339,000 in the six months ended June 30, 2001.

**Other income, net**
 Three months endedJune 30, Six months endedJune 30,     2001 2000 2001 2000       (in thousands, except percentages)          Other income, net$(5)$16 $26 $24 Percentage of total revenues- 1%1%1%
In the three months ended June 30, 2001,Insignia realized a foreign exchange loss of $5,000 compared to a gain of$16,000 in the three months ended June 30, 2000.  In the six months ended June 30, 2001, Insignia realized aforeign exchange gain of $26,000 compared to a gain of $24,000 in the sixmonths ended June 30, 2000.
Approximately 94% of Insignia’s totalrevenues and over 45% of its operating expenses are denominated in UnitedStates dollars.  Most of the remainingrevenues and expenses of Insignia are British pound sterling denominated andconsequently Insignia is exposed to fluctuations in British pound sterlingexchange rates.  To hedge against thiscurrency exposure, Insignia has, in prior years, entered into foreign currencyoptions and forward exchange contracts for periods and amounts consistent withthe amounts and timing of its anticipated British pound sterling denominatedoperating cash flow requirements

Insignia has, at times, an investmentportfolio of fixed income securities that are classified as “available for salesecurities.”  These securities, like allfixed income instruments, are subject to interest rate risk and will fall invalue if market interest rates increase. Insignia attempts to limit this exposure by investing primarily inshort-term securities.

**Provision (benefit) for incometaxes**
 Three months ended  June 30, Six months endedJune 30,     2001 2000 2001 2000       (in thousands) Provision (benefit) for incometaxes$60 $(596)$60 $(591)Effective income tax rate- - - - 
Insignia’s benefit for income taxes forthe three and six months ended June 30, 2000 primarily represents a tax refundfrom the U.K. government on taxes paid in the years 1995 - 1997.  Insignia’s provision for income taxes forthe three and six months ended June 30, 2001 primarily represents Japanesesales tax withholding.  Insignia hasrecorded a full valuation allowance against all deferred tax assets, primarilycomprising net operating losses, on the basis that significant uncertaintyexists with respect to their realization.

**Liquidity and capital resources**
 June 30, June 30,  2001 2000     (in thousands)      Cash, cash equivalents and restricted cash$12,470 $1,300 Cash and cash equivalents held in escrow$- $5,200 Working capital (deficit)$15,396 $(3,348)Net cash used in operating activities$(9,865)$(6,201)
Insignia has transitioned its productfocus from compatibility products to its Jeode product line based on Insignia’sEVM technology.  This change in productfocus has resulted in a redirection of available resources from Insignia’shistorical revenue base towards the development and marketing effortsassociated with the Jeode platform, which was released for general availabilityin March 1999.  Cash used in operatingactivities in the second quarter of 2001 totaled $5.5 million compared to $4.4million in the first quarter of 2001.  Forthe six months ended June 30, 2001, cash used in operating activities totaled$9.9 million compared to $6.2 million for the same period in 2000.
Insignia’s cash, cash equivalents,restricted cash, and funds held in escrow, were $12.5 million at June 30, 2001,an increase of $6.0 million from $6.5 million at June 30, 2000.  Working capital increased to $15.4 millionat June 30, 2001, from $(3.3) million at June 30, 2000.  The principal source of working capital camefrom a private placement funding, warrant exercises and receivable collections.

A large portion of the accountsreceivable balance for the quarter ended June 30, 2001 is related to onecustomer and accounts for 75% of the the outstanding balance.

Insignia has granted extended paymentterms from time to time and recognizes these future payments as accountsreceivable and deferred revenue.

Insignia believes that the cash it willgenerate from on going operations and other sources of capital will besufficient to meet Insignia’s expected liquidity and capital needs through Juneof 2002.

**Item 3.  Quantitative and Qualitative DisclosuresAbout Market Risk.**

From time to time, Insignia enters intoderivative financial instruments such as currency option contracts to hedgecertain anticipated, but not yet committed, transactions expected to bedenominated in foreign currencies. Insignia does not use derivative financial instruments for trading orspeculative purposes.  Insignia’sdownside risk with respect to currency option contracts (British pound sterling)is limited to the premium paid for the right to exercise the option.  Insignia did not enter into any currencyoption hedge contracts in the second quarter of 2001 or the second quarter of2000 and had no option hedge contracts outstanding as of June 30, 2001 or June30, 2000.
**PART II - OTHER INFORMATION**

**Item 4.  Submission of Matters to a Vote of SecurityHolders**
(a)Insignia  held its Annual General Meeting on June 8, 2001.  Proxies for the meeting were solicited pursuant to Regulation  14A.  (b)At  each Annual General Meeting, the third of Insignia’s Board of Directors who  have been in office longest since their last election, as well as any  directors appointed by the Board during the preceding year, are required to  resign and are then considered for re-election, assuming they wish to stand  for re-election.  Richard M. Noling  and Vincent S. Pino were re-elected and John C. Fogelin was elected as  Directors at the meeting.  The  Directors whose term of office continues after the meeting are Nicholas,  Viscount Bearsted and David G. Frodsham.  (c)The  matters described below were voted on at the Annual General Meeting, and the  number of votes cast with respect to each matter and, with respect to the  election of directors, for each nominee, were as indicated:
2. To re-appoint PricewaterhouseCoopersas UK statutory auditors of Insignia until the conclusion of the next AnnualGeneral Meeting and to authorize the Directors to fix their remuneration.
FORAGAINST 9,435,080445,698 
3. To elect as a Director John C.Fogelin.
FORAGAINST 9,745,208145,240 
4. To re-elect as a Director Richard M.Noling.
FORAGAINST 9,819,04667,014 
5. To re-elect as a Director, Vincent S.Pino
FORAGAINST 9,816,99769,379 
6. To amend Insignia’s UK Employee ShareOption Scheme 1996 to increase the number of ordinary shares available forissuance under the plan by 1,000,000 to a total of 6,072,071 shares.
FORAGAINST 9,684,039190,194 
7. To amend Insignia’s 1995 IncentiveStock Option Plan for US Employees to increase the number of ordinary sharesavailable for issuance under the plan by 1,000,000 to a total of 6,072,071shares.
FORAGAINST 9,682,239190,894 
8. To increase Insignia’s authorizedshare capital by creating an additional 20,000,000 ordinary shares of 20pnominal value.FORAGAINST 9,549,748326,952 
9. Conditioned upon the passing ofProposal 8 above, to authorize the Board of Directors of Insignia to issue upto 26,224,249 ordinary shares (or other relevant securities derived from suchordinary shares, such as options or warrants) of Insignia without first gainingshareholder approval, with such authority lasting a period of five years.
FORAGAINST 9,471,758405,237 
10. Conditioned upon the passing ofProposal 9 above, to authorize the Board of Directors of Insignia to issue upto 26,224,249 ordinary shares (or other securities derived from such ordinary shares, such as options orwarrants) without giving shareholders the first opportunity to purchase suchshares or securities, with such authority lasting a period of five years.
FORAGAINST 9,431,902447,298 
 

**Item 6.  Exhibits andReports on Form 8-K**

(a) ExhibitsThe following exhibit is filed as part of this Report:

None

(b) Reports on Form 8-K

None
**SIGNATURES**

Pursuant to the requirements of theSecurities Exchange Act of 1934, the Registrant has duly caused this report tobe signed on its behalf by the undersigned thereunto duly authorized.
 INSIGNIA SOLUTIONS PLC (Registrant)  Date:  August 14, 2001    /s/ ALBERT J. WOOD  ALBERT J. WOOD Chief Financial  Officer
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