<PAGE>   1

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

                UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

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

                                   FORM 10-Q

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

<Table>
<C>          <S>
 (Mark One)
    [X]      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
             OF THE SECURITIES EXCHANGE ACT OF 1934



             FOR THE QUARTERLY PERIOD ENDED AUGUST 31, 2001

                                   OR




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



             FOR THE TRANSITION PERIOD FROM           TO           .
</Table>

                        COMMISSION FILE NUMBER 000-22565

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

<Table>
<S>                                            <C>
                   DELAWARE                                      77-0298386
       (State or other jurisdiction of                        (I.R.S. Employer
        incorporation or organization)                     Identification Number)

     830 E. ARQUES AVENUE, SUNNYVALE, CA                           94085
   (Address of principal executive offices)                      (Zip Code)
</Table>

       REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (408) 774-2199

     Indicate by check mark whether the Registrant (1) has filed all reports 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 [ ]

     The number of shares of the Registrant's Common Stock outstanding as of
August 31, 2001 was 36,853,062.

--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<PAGE>   2

                              INGENUUS CORPORATION

                                   FORM 10-Q
                     FOR THE QUARTER ENDED AUGUST 31, 2001

                               TABLE OF CONTENTS

<Table>
<Caption>
                                                                       PAGE
                                                                       ----
<S>      <C>                                                           <C>
                      PART I.  FINANCIAL INFORMATION
Item 1.  Condensed Consolidated Financial Statements
         a) Condensed Consolidated Statements of Operations for the
         three and nine months ended August 31, 2001 and 2000........    2
         b) Condensed Consolidated Balance Sheets at August 31, 2001
            and November 30, 2000....................................    3
         c) Condensed Consolidated Statements of Cash Flows for the
         nine months ended August 31, 2001 and 2000..................    4
         d) Notes to Condensed Consolidated Financial Statements.....    5
Item 2.  Management's Discussion and Analysis of Financial Condition
         and Results of Operations...................................   13
Item 3.  Quantitative and Qualitative Disclosure About Market Risk...   25

                        PART II. OTHER INFORMATION
Item 1.  Legal Proceedings...........................................   25
Item 4.  Submission of Matters to a Vote of Security Holders.........   28
Item 5.  Other Information...........................................   29
Item 6.  Exhibits and Reports on Form 8-K............................   29
SIGNATURES...........................................................   30
</Table>

                                        1
<PAGE>   3

                         PART I.  FINANCIAL INFORMATION

ITEM 1.  CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

                              INGENUUS CORPORATION

                CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                    (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
                                  (UNAUDITED)

<Table>
<Caption>
                                                                QUARTER ENDED         NINE MONTHS
                                                                 AUGUST 31,        ENDED AUGUST 31,
                                                              -----------------   -------------------
                                                               2001      2000       2001       2000
                                                              -------   -------   --------   --------
                                                                            (UNAUDITED)
<S>                                                           <C>       <C>       <C>        <C>
Revenue.....................................................  $   366   $   951   $  1,320   $  2,262
Cost of revenue.............................................      599       738      2,024      2,313
                                                              -------   -------   --------   --------
Gross profit/(Loss).........................................     (233)      213       (704)       (51)
                                                              -------   -------   --------   --------
Operating expenses:
  Research and development..................................      526       794      1,925      1,971
  Sales and marketing.......................................    1,384       853      4,137      1,773
  General and administrative................................      877     1,042      3,365      5,188
  Write-off of purchased technology.........................       --        --         --        925
  Amortization -- goodwill..................................      834       928      2,502      2,724
                                                              -------   -------   --------   --------
         Total operating expenses...........................    3,621     3,617     11,929     12,581
(Loss) from operations......................................   (3,854)   (3,404)   (12,633)   (12,632)
Interest and other income, net..............................      547       242        712        649
Gain on sale of investment..................................       43        --      5,935         --
Equity losses from joint venture............................       --        --         --        (67)
                                                              -------   -------   --------   --------
(Loss) from continuing operations...........................   (3,264)   (3,162)    (5,986)   (12,050)
(Loss) from discontinued operations.........................     (145)     (112)      (524)    (4,662)
(Loss)/ gain on disposal of discontinued operations.........     (705)      (70)      (705)     5,363
                                                              -------   -------   --------   --------
Gain/(Loss) attributed to discontinued operations...........     (850)     (182)    (1,229)       701
Provision for income taxes..................................        2        --          5         --
                                                              -------   -------   --------   --------
Net loss....................................................  $(4,116)  $(3,344)  $ (7,220)  $(11,349)
                                                              =======   =======   ========   ========
EARNINGS PER SHARE -- BASIC AND DILUTED
Continuing operations.......................................  $ (0.09)  $ (0.09)  $  (0.16)  $  (0.33)
Income (Loss) from discontinued operations..................       --        --      (0.02)     (0.13)
Gain/(Loss) on disposal of discontinued operations..........    (0.02)       --      (0.02)       .15
Net loss per share..........................................    (0.11)    (0.09)     (0.20)     (0.31)
EARNINGS PER SHARE -- DILUTED
Continuing operations.......................................    (0.09)    (0.09)     (0.16)     (0.33)
Discontinued operations.....................................       --        --      (0.02)     (0.13)
Gain/(Loss) on disposal of discontinued operations..........    (0.02)       --      (0.02)       .15
Net loss per share..........................................    (0.11)    (0.09)     (0.20)     (0.31)
Shares used in basic per share calculation..................   36,853    36,668     36,829     36,123
Shares used in diluted per share calculation -- Continuing
  operations................................................   36,853    36,668     36,829     36,123
Shares used in diluted per share calculation -- Loss from
  discontinued operations...................................   36,853    36,668     36,829     36,123
Shares used in diluted per share calculation -- Gain/(Loss)
  on disposal of discontinued operations....................   36,853    36,668     36,829     37,060
</Table>

     See accompanying notes to condensed consolidated financial statements.
                                        2
<PAGE>   4

                              INGENUUS CORPORATION

                     CONDENSED CONSOLIDATED BALANCE SHEETS
                                 (IN THOUSANDS)

<Table>
<Caption>
                                                              AUGUST 31,    NOVEMBER 30,
                                                                 2001           2000
                                                              -----------   ------------
                                                              (UNAUDITED)
<S>                                                           <C>           <C>
                                         ASSETS
Current assets:
  Cash and cash equivalents.................................   $  7,294       $  8,789
  Short-term investments....................................        262          5,972
  Accounts receivable, (net of allowance)...................        549            553
  Income taxes receivable...................................        609          2,089
  Note receivable...........................................        932          3,833
  Prepaid expenses and other current assets.................        389            186
                                                               --------       --------
          Total current assets..............................     10,035         21,422
Property and equipment, net.................................        427            808
Goodwill and other intangible assets........................     10,587         14,542
Restricted cash.............................................        125            106
Net due from Chip & Chip....................................      1,401          1,401
Investments and other assets................................        111            175
                                                               --------       --------
          Total assets......................................   $ 22,686       $ 38,454
                                                               ========       ========
                          LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
  Accounts payable..........................................   $    949       $  1,682
  Accrued liabilities.......................................      3,284          6,040
  Deferred revenue..........................................        572            527
                                                               --------       --------
          Total current liabilities.........................      4,805          8,249
Other liabilities, long term................................        219            219
                                                               --------       --------
          Total liabilities.................................      5,024          8,468
                                                               --------       --------
Commitments and contingencies
Stockholders' equity:
  Common stock..............................................    102,591        102,577
  Treasury stock............................................     (3,254)        (3,085)
  Accumulated other comprehensive income....................        226          5,132
  Accumulated deficit.......................................    (81,901)       (74,638)
                                                               --------       --------
          Total stockholders' equity........................     17,662         29,986
                                                               --------       --------
          Total liabilities and stockholders' equity........   $ 22,686       $ 38,454
                                                               ========       ========
</Table>

     See accompanying notes to condensed consolidated financial statements.
                                        3
<PAGE>   5

                              INGENUUS CORPORATION

                CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)
                                  (UNAUDITED)

<Table>
<Caption>
                                                                 NINE MONTHS ENDED
                                                              -----------------------
                                                              AUGUST 31,   AUGUST 31,
                                                                 2001         2000
                                                              ----------   ----------
<S>                                                           <C>          <C>
Cash flows from operating activities:
  Net loss..................................................   $ (7,220)    $(11,349)
  Deduct: Gain on disposal of discontinued operations.......        705       (5,363)
           Losses between year-end and the measurement
          date..............................................                    (999)
                                                               --------     --------
  Net Loss from operations..................................     (6,515)     (17,711)
                                                               --------     --------
  Adjustments from operating activities:
     Realized gain on Virage Logic shares...................     (5,935)          --
     Depreciation and amortization..........................      3,636        6,162
     Gain/Loss)on disposal of fixed assets..................          3          (86)
     Cumulative translation adjustment......................        (44)          --
     Changes in assets and liabilities
       Accounts receivable..................................          4        1,522
       Prepaid expenses and other current assets............       (238)        (132)
       Income tax receivable................................      1,480           --
       Restricted cash......................................        (19)          --
       Accounts payable.....................................       (731)      (1,305)
       Accrued and other liabilities........................     (2,728)      (1,122)
       Customer advances....................................         45        1,118
                                                               --------     --------
          Net cash used for operating activities of
           continuing operations............................    (11,042)     (11,554)
                                                               --------     --------
Cash flows from investing activities:
  Acquisition of Inbox -- net of cash.......................         --       (7,603)
  Proceeds from sale of Virage Logic shares.................      6,739           --
Overdraft disposed of, net of cash acquired -- Chip &
  Chip......................................................                      24
  Purchases of fixed assets.................................        (40)      (2,765)
  Sale of fixed assets......................................          3          296
  Write-off of notes receivable.............................         --          (44)
                                                               --------     --------
          Net cash provided by (used for) investing
           activities of continuing operations..............      6,702      (10,092)
                                                               --------     --------
Cash flows from financing activities:
  Proceeds from issuance of common stock....................         14          399
  Repurchase of common stock................................       (169)          --
                                                               --------     --------
          Net cash provided by (used for) financing
           activities of continuing operations..............       (155)         399
                                                               --------     --------
Operating cashflow from discontinued operations.............      3,000        6,955
                                                               --------     --------
Net (decrease) in cash and equivalents......................     (1,495)     (14,292)
Cash and cash equivalents, beginning of period..............      8,789       23,884
                                                               --------     --------
Cash and cash equivalents, end of period....................   $  7,294     $  9,592
                                                               ========     ========
</Table>

     See accompanying notes to condensed consolidated financial statements.
                                        4
<PAGE>   6

                              INGENUUS CORPORATION

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                  (UNAUDITED)

1.  BASIS OF PRESENTATION

     The accompanying unaudited condensed consolidated financial statements of
Ingenuus Corporation (the "Company") have been prepared in accordance with
generally accepted accounting principles in the United States ("GAAP") for
interim financial information and in accordance with instructions to Form 10-Q
and Article 10 of Regulation S-X. Accordingly, they do not include all of the
information and footnotes required by GAAP for complete financial statements. In
the opinion of management, all adjustments (consisting of normal recurring
adjustments) considered necessary for a fair presentation have been included.
Operating results for the nine months ended August 31, 2001 are not necessarily
indicative of the results that may be expected for the fiscal year ending
November 30, 2001 or for any other period. The unaudited condensed consolidated
interim financial statements contained herein should be read in conjunction with
the audited financial statements and footnotes for the year ended November 30,
2000 included in the Company's Annual Report on Form 10-K as filed with the
Securities and Exchange Commission on February 28, 2001.

     Certain reclassifications has been made to 2000 amounts to conform with the
2001 presentation. These reclassifications had no effect on net loss.

2.  DISCONTINUED OPERATIONS

     On April 6, 2000, the Company sold its semiconductor intellectual property,
library development and design tools and service business ("SIP Business") to
DII Semiconductor Inc. ("DII") for $11.3 million ($5.5 million in cash and
approximately $1 million due quarterly through October 2001). As a result, the
operations of the EDA Business have been classified as discontinued operations
in the accompanying Condensed Consolidated Financial Statements and related
Notes.

     Revenues for the SIP Business were $1.3 million for the first quarter of
fiscal 2000 and $729,000 through the date of disposal.

     The Company has unsuccessfully tried selling Verilux, the Electronic Design
Automation ("EDA") segment of the company. On May 15, 2001, the Company notified
Verilux Design Technology ("Verilux") employees of its intent to terminate their
employment with the Company in one hundred twenty days and accrued termination
benefits of $226,000 in the second quarter. On June 18, 2001, the Company
adopted a plan to dispose of the assets of Verilux Design Technology. In the
event that the assets of Verilux Design Technology could not be sold, the
Verilux business would be discontinued effective August 31, 2001. As a result,
the operations of the EDA business have been classified as discontinued
operations in the accompanying Condensed Consolidated Financial Statements and
related Notes.

     Revenues for the EDA Business were $270,000 for the nine months ending
August 31, 2001 and $535,000 for nine months ending August 31,2000.

3.  EARNINGS PER SHARE (EPS) DISCLOSURES

     Basic EPS excludes dilution and is computed by dividing net income
attributable to common stockholders by the weighted average of common shares
outstanding (excluding shares subject to repurchase rights) for the period.
Diluted EPS reflects the potential dilution that could occur if securities or
other contracts to issue common stock were exercised or converted into common
stock.

     The shares used for the calculation of diluted EPS excludes 0 and 1,235,000
common share equivalents related to purchase rights and options for Q3 2001 and
Q3 2000 respectively, because the inclusion will have an anti-dilutive effect on
EPS.

                                        5
<PAGE>   7
                              INGENUUS CORPORATION

      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                  (UNAUDITED)

4.  RECENT ACCOUNTING PRONOUNCEMENTS

     In June 1998, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 133 ("SFAS 133"), "Accounting for Derivative
Instruments and Hedging Activities." SFAS 133 establishes new standards of
accounting and reporting for derivative instruments and hedging activities. SFAS
133 requires that all derivatives be recognized at fair value in the statement
of financial position, and that the corresponding gains or losses be reported
either in the statement of operations or as a component of comprehensive income,
depending on the type of hedging relationship that exists. In July 1999, the
Financial Accounting Standard Boards issued SFAS No. 137 ("SFAS 137"),
"Accounting for Derivative Instruments and Hedging Activities -- Deferral of the
Effective Date of SFAS No. 133." SFAS 137 deferred the effective date of SFAS
133 until the first fiscal quarter of the fiscal year beginning after June 15,
2000.

     The Company adopted SFAS 133 in the first quarter of fiscal 2001. The
adoption of SFAS 133 did not have a material effect on the Company's financial
position or results of operations.

     In December 1999, the SEC issued Staff Accounting Bulletin No. 101 ("SAB
101"), Revenue Recognition in Financial Statements." SAB 101 summarizes certain
of the SEC's views in applying generally accepted accounting principles to
revenue recognition in financial statements. The Company adopted SAB 101 in the
first quarter of fiscal 2001. The adoption of SAB 101 did have a material effect
on the Company's financial position or results of operations.

     In March 2000, the Financial Accounting Standards Board issued FASB
Interpretation No. 44 ("FIN 44"), "Accounting for Certain Transactions Involving
Stock Compensation -- an Interpretation of APB 25." FIN 44 becomes effective
July 1, 2000, but certain conclusions cover specific events that occur after
either December 15, 1998 or January 12, 2000. This may have a material effect on
future periods with respect to options which were repriced in the first quarter
of fiscal 2001 and are subject to variable plan accounting.

     In July 2001, the FASB issued two Statements, Statement No. 141, "Business
Combinations" ("SFAS No. 141"), and Statement No. 142, "Goodwill and Other
Intangible Assets" ("SFAS No. 142"). SFAS No. 141 revises accounting treatment
for business combinations requiring the use of purchase accounting and
prohibiting the use of pooling-of-interests method for all business combinations
initiated after June 30, 2001 and broadens the criteria for recording intangible
assets separate from goodwill for all business combinations completed after June
30, 2001. SFAS No. 142 revises the accounting for goodwill and other intangible
assets by not allowing amortization of goodwill and establishing accounting for
impairment of goodwill and other intangible assets. SFAS No. 142 will be
effective for fiscal years beginning after December 15, 2001, with early
adoption allowed for companies with a fiscal year beginning after March 15,
2001. The Company expects to adopt the pronouncement as of December 1, 2001, the
beginning of its fiscal year 2002. The Company has not yet evaluated the effects
of these changes on its consolidated financial statements.

5.  COMPREHENSIVE INCOME (LOSS)

     The Company follows the provisions of SFAS No. 130, "Reporting
Comprehensive Income." This statement requires companies to classify items of
other comprehensive income by their components in the financial statements and
display the accumulated balance of other comprehensive income separately from
retained earnings in the equity section of a statement of financial position.

                                        6
<PAGE>   8
                              INGENUUS CORPORATION

      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                  (UNAUDITED)

     The Company's total comprehensive income (loss) was as follows (in
thousands):

<Table>
<Caption>
                                                            QUARTER ENDED    NINE MONTHS ENDED
                                                             AUGUST 31,         AUGUST 31,
                                                           ---------------   -----------------
                                                            2001     2000     2001      2000
                                                           ------   ------   -------   -------
<S>                                                        <C>      <C>      <C>       <C>
Net Loss.................................................  (4,116)  (3,344)   (7,220)  (11,349)
Other comprehensive income:
Realized gain -- previously recognized...................      --       --    (6,050)       --
Unrealized holding gain on available -- for sale
  marketable securities..................................     (50)   9,037     1,145     9,037
                                                           ------   ------   -------   -------
Comprehensive Income/(Loss)..............................  (4,166)   5,693   (12,125)   (2,312)
</Table>

6.  INVESTMENTS

  INVESTMENT IN VIRAGE LOGIC

     In fiscal 1998, the Company made a private equity investment in Virage
Logic Corp. ("Virage"), for an aggregate cost of $0.8 million. This investment
is held at fair value and is classified in current assets, as the Company
intends to realize this investment in the short term. As of August 31, 2001, the
Company sold 503,000 of the 525,000 shares held, for $6.74 million. The
unrealized gain of $0.23 million on the remaining 22,000 shares is recognized in
accumulated other comprehensive income, in accordance with SFAS 115, "Accounting
for certain investments in debt and equity securities".

  IMPAIRMENT OF INVESTMENT IN SLIM TECHNOLOGY

     During the first quarter of fiscal 1999, the Company purchased a 40%
interest in Slim Technology Co, Ltd., a Korean company, ("Slim Tech"), at a cost
of $2.3 million. Slim Tech performs semiconductor design services for Korean
customers. With the disposal of the SIP business in April 2000 and the Company's
new focus as a software business-to-business collaborative commerce company, the
investment in Slim Tech was no longer strategic to the Company's operations, and
as a result, the Board of Directors authorized management to sell the
investment. Based on a number of factors, including the failure to find a buyer
for the investment and recurring operating losses generated from the investment,
and in accordance with the provisions of APB 18 "The Equity Method of Accounting
for Investments in Common Stock", management assessed that there had been a
permanent decline in the value of this investment. An impairment charge of $1.7
million was recorded in Q4 of fiscal 2000 to write down the value of the
investment.

7.  SALE OF CHIP & CHIP, INC.

     On June 13, 2000, the Company entered into an Asset Purchase Agreement with
the management of Chip & Chip, part of the Electronic Design Automation ("EDA")
segment of the company. Chip & Chip Management purchased the assets and certain
liabilities of Chip & Chip Inc. ("Chip & Chip") for $2,580,000, (payable in
three installments over the next two years). The proceeds are secured on 1
million Ingenuus shares and fully vested options to purchase 0.7 million shares
held by Chip & Chip management, and 1 million shares of Chip & Chip. The gain of
$292,000 from the sale has been deferred and will be recognized as the payments
are received.

     The Company received the first installment of the sales consideration on
the due date in the fourth quarter of fiscal 2000, $242,000 in cash and $633,000
by surrendering 500,000 shares of Ingenuus stock to the Company. The remaining
two equal installments are due in October 2001 and July 2002.

                                        7
<PAGE>   9
                              INGENUUS CORPORATION

      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                  (UNAUDITED)

8.  SEGMENT AND GEOGRAPHIC INFORMATION

     As of August 31, 2001, the Company operated in one segment only, Ingenuus.
The Ingenuus segment includes the business-to-business collaborative commerce
solutions related to Inbox Software, Inc. ("InBox"), as well as the hardware and
software maintenance services related to Novo Systems ("Novo").

     The EDA segment which included the development and sale of software tools
for Electronic Design Automation, related to Verilux Design Technology
("Verilux") was discontinued as of August 31, 2001.

     Enterprise-wide information is provided in accordance with SFAS No. 131.
Revenue is by country, based on the location of the customer. All property and
equipment, except for an immaterial amount, is based in the United States and
therefore is not disclosed below. Geographic revenue for each of the three-month
period ended August 31, 2001 and August 31, 2000 is as follows (in thousands):

<Table>
<Caption>
                                                                   QUARTER ENDED
                                                              -----------------------
                                                              AUGUST 31,   AUGUST 31,
                                                                 2001         2000
                                                              ----------   ----------
<S>                                                           <C>          <C>
United States...............................................     $127         $638
Asia........................................................      224          302
Other International.........................................       15           11
                                                                 ----         ----
          Total.............................................     $366         $951
                                                                 ====         ====
</Table>

     Major Customers and International Sales -- For the quarter ended August 31,
2001, three customers accounted for 37.06%, 20.51% and 13.55% for a total 71.12%
of revenue. For the quarter ended August 31, 2000, four customers accounted for
19.73%, 14.73%, 10.70%, and 9.04% for a total of 54.20% of revenue.

9.  STOCK REPURCHASE PROGRAM

     In March 2001, the Company approved a stock repurchase program in which up
to $1,500,000 of its Common Stock may be purchased by the Company in the open
market from time to time, depending upon market conditions, share price and
other factors. As of August 31, 2001, Ingenuus had repurchased 482,200 shares of
Common Stock under this program at a total cost of $169,200.

10.  REPRICING OF STOCK OPTION

     In January 2001, the Board of Directors approved a proposition to reduce
the exercise price of all employees' and consultants' stock options outstanding
to $0.38 per share, the fair market value of the Company's common stock as of
January 8, 2001. On September 24, 2001, the Board of Directors approved a
proposition again to reduce the exercise price of all employees' and
consultants' stock options outstanding to $0.11 per share, the fair market value
of the Company's common stock as of September 25, 2001. As a result of such
modification, all options eligible to the offer are subject to variable plan
accounting until the option is exercised, cancelled or expired. Any future
increase in stock market price will result in additional compensation expense.

     For the quarter and nine months ended August 31, 2001, the Company did not
record any compensation expenses related to repricing of stock options since the
stock market price was below the repriced option price.

                                        8
<PAGE>   10
                              INGENUUS CORPORATION

      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                  (UNAUDITED)

11.  CONTINGENCIES

  CLASS ACTION LAWSUITS

     On July 1, 1998, a class action lawsuit, Howard Jonas, et al. v. Aspec
Technology, Inc., et al., No. CV-775037 ("the Jonas Complaint"), was filed in
the Superior Court for the State of California, County of Santa Clara. The Jonas
Complaint alleged that Aspec Technology, Inc. ("Aspec") and certain of its
officers, directors and the underwriters of the Company's initial public
offering, violated California Corporations Code Sections 25400 and 25500, and
California Business and Professions Code Sections 17200 and 17500 by making
false and misleading statements about Aspec's financial condition. The action
was purportedly brought on behalf of all persons who purchased Aspec stock
during the period from April 28, 1998 through June 25, 1998. On July 2, 1998,
July 27, 1998, and August 17, 1998, three additional complaints were filed in
state court against the Company and certain of its officers, directors, entitled
respectively, William Neuman, et al. v. Aspec Technology, Inc., et al., No.
CV-775089 ("the Neuman Complaint"); Martin L. Klotz, on behalf of the Martin
Klotz Defined Benefit Profit Sharing Plan, et al. v. Aspec Technology, Inc., et
al., No. CV-776065. In addition to alleging the same violations of the
Corporations Code as the three other complaints, the Klotz Complaint also
alleged violations of Sections 11, 12, and 15 of the Securities Act of 1933, and
a class period of April 28, 1998 through June 30, 1998. The complaints sought
unspecified damages. A fifth similar complaint, filed in federal court, was
later dismissed.

     On January 29, 1999, the plaintiffs consolidated the pending class action
cases and filed a Consolidated Amended Complaint, styled Howard Jonas, et al. v.
Aspec Technology, Inc., et al., No. CV-775037. The Consolidated Amended
Complaint, which was purportedly brought on behalf of all persons who purchased
Aspec's stock between April 27, 1998 and June 30, 1998, alleged that Aspec and
certain of its officers and directors, as well as its underwriters, violated
Sections 25400 and 25500 of the California Corporations Code, and Sections 11
and 15 of the Securities Act of 1933 (except as to the underwriters). On June 7,
1999, Aspec and certain of the individual defendants filed demurrers to the
Consolidated Complaint (the "Aspec Defendants"). On June 9, 1999, the plaintiffs
filed a motion for summary adjudication of their claims against Aspec under
Section 11 of the Securities Act. The plaintiffs also moved to certify a
plaintiff class.

     On August 26, 1999, the court heard argument on the defendants' demurrers.
The court sustained the demurrers in part and overruled them in part.
Specifically, the court held that the plaintiffs had not pleaded their claims
under California Corporations Code Section 25400 with sufficient particularity
and granted plaintiffs leave to amend this claim. The court overruled the
defendants' demurrers to the Section 11 claim. Following that hearing,
plaintiffs withdrew their motion for summary adjudication. Thereafter plaintiffs
filed their First Amended Class Action Complaint, under seal, on October
18,1999.

     On January 11, 2000, the defendants filed demurrers to Count I of the First
Amended Complaint, which alleged claims under California Corporations Code
Sections 25400/25500. The Aspec Defendants demurred to Count I on the basis that
plaintiffs had not pleaded facts demonstrating that the defendants had acted
with scienter. The Aspec Defendants also moved to strike certain allegations in
the complaint. The motions were fully briefed, and the court heard oral argument
on defendants' demurrers and motion to strike, and plaintiffs' motion for class
certification on February 24, 2000. The court overruled the defendants'
demurrers, denied the motion to strike and took the motion for class
certification under submission. Thereafter, on March 13, 2000, the Aspec
Defendants answered the plaintiffs' unverified complaint, generally denying all
allegations and asserting affirmative defenses.

     On March 16, 2000, the court certified a plaintiff class. On that same
date, the Court found, sua sponte, that the case is complex, and pursuant to a
pilot program implemented in the Superior Court for Santa Clara County, assigned
it to a single judge for all purposes. The plaintiffs thereafter re-noticed
their motion for

                                        9
<PAGE>   11
                              INGENUUS CORPORATION

      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                  (UNAUDITED)

summary adjudication of their Section 11 claim; based on stipulations between
the parties, the defendants did not respond to the motion and that motion has
not been heard.

     The parties and non-party Deloitte & Touche LLP, Aspec's former auditor,
executed a Memorandum of Understanding, on or about December 1, 2000, with the
objective of settling the class action litigation. On August 17, 2001, the court
issued various orders, including an order of final judgment approving the
settlement and dismissing the case with prejudice as to all defendants. Pursuant
to the terms of the settlement agreement and the court's order, Aspec (now known
as Ingenuus Corporation) paid $1.4 million into the settlement fund, and
thereafter, issued 1.75 million shares of common stock to the plaintiff class.

     As of November 30, 2000, the settlement cost has been accrued, including
the stock element, using a price of $0.50 per share, the fair market value of
the Company's common stock at November 30, 2000.

  DERIVATIVE LAWSUIT

     Certain of the Company's current and former officers, directors and
shareholder entities were also named as defendants in a derivative lawsuit
styled Linda Willinger, IRA, et al. v. Conrad Dell'Oca et al., No. CV-778007,
filed on November 12, 1998, in the Superior Court of Santa Clara County. The
derivative action alleges facts similar to those in the class action and also
alleges that certain of the directors caused the Company to conduct the initial
public offering in order to redeem preferred stock they owned or in which they
had a beneficial interest. Aspec filed a demurrer to that Complaint on June 8,
1999 on behalf of certain of the officer and director defendants and nominal
defendant ("Aspec"). Thereafter, the plaintiffs requested defendants' assent to
the dismissal of their complaint and the filing of an amended complaint.
Derivative Plaintiffs filed their First Amended Shareholders' Derivative
Complaint on September 2, 1999.

     The Aspec Defendants demurred to that complaint on November 12, 1999, on
the basis that the nominal plaintiffs had failed to make a demand on the Board
of Directors before filing the derivative lawsuit, and that they had also failed
to plead sufficient facts to excuse a pre-suit demand. After the matter was
fully briefed, the court heard argument on January 25, 2000. On January 27,
2000, the court sustained the defendants' demurrers with sixty days' leave to
amend.

     The parties later stipulated that the plaintiffs would have additional time
in which to file an amended complaint, as well as to re-notice a motion to
compel the production of electronically-stored documents and records from Aspec,
as well as to notice the deposition of a witness from the Company to testify
concerning the storage of such documents and records.

     On or about December 1, 2000 certain of the defendants, including nominal
defendant, Aspec (now Ingenuus), the plaintiffs, and non-party Deloitte & Touche
LLP, the Company's former auditor, executed a Memorandum of Understanding, with
the objective of settling the derivative litigation.

     On February 23, 2001, at a hearing before Judge Conrad Rushing, the parties
advised the Court that they had reached agreement on a Stipulation of
Settlement, which they provided to the Court. The settlement would fully and
finally settle and resolve the derivative litigation, including a dismissal of
the action with prejudice as to all defendants. The Stipulation requires the
Company to pay the derivative plaintiffs' attorneys' fees in the amount of
$395,000, which was accrued as of November 30, 2000, as well as to make certain
changes to the Company's audit committee charter. Upon the effective date, which
includes the occurrence of the effective date of the separate Stipulation of
Settlement to be approved by the Court in the Class Action, the parties to the
Stipulation in the derivative litigation will release one another from claims
arising from or relating to the derivative action, as set forth in the
Stipulation. Thereafter, on March 6, 2001, the Court entered an Order approving
the Stipulation of Settlement and dismissing the matter with prejudice as to all
defendants.

                                        10
<PAGE>   12
                              INGENUUS CORPORATION

      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                  (UNAUDITED)

  OTHER LITIGATION

     On June 21, 1999, a lawsuit entitled Cadabra Design Technology, Inc. v.
Aspec Technology, Inc., No. CV-782691, was filed in the Superior Court, County
of Santa Clara. Plaintiff's complaint sought damages in excess of $1 million for
an alleged breach of a commercial software licensing agreement entered into by
Cadabra Design Technology, Inc. ("Cadabra") and the Company on or about August
18, 1998. On August 6, 1999, the Company answered the complaint -- denying
liability and asserting various affirmative defenses -- and filed a
cross-complaint seeking damages according to proof and equitable relief for
breach of contract, conversion, and negligent misrepresentation on the part of
Cadabra. On February 16, 2000, the parties executed a Settlement Agreement and
General Release in the case, pursuant to which the Company paid Cadabra $600,000
in full and final satisfaction of all claims related to the parties' software
licensing agreement. On March 1, 2000, the case was dismissed in accordance with
the parties' Settlement Agreement.

     Aspec Technology, Inc. v. Compaq Computers, Inc. was filed on December 28,
1998 in the Superior Court of California, Santa Clara County, No. CV778943. By
the Company's complaint, they sought to collect the principal sum of $403,344,
plus interest, attorneys' fees and costs, from Compaq, alleging that Compaq had
breached a contract to purchase certain of the Company's library software.
Compaq filed a counter claim alleging that the Company had breached the contract
by failing to deliver in functional form the promised software on the schedule
promised, as well as alleging fraudulent misrepresentation relating to the
contract. The counter claim alleges unspecified damages in excess of $25,000. A
settlement was entered into under which Compaq paid the Company $185,000.
Dismissals of the lawsuit have been filed with the court by all parties.

     On September 23, 1999, a lawsuit entitled Lesley Nemeth v. Aspec Technology
Inc., was filed in Superior Court, County of Santa Clara No. DC 383204.
Plaintiff is a former consultant to the Company who seeks in her complaint
damages in the sum of $12,600 plus interest and attorneys' fees. On November 23,
1999 the court ordered the matter to binding arbitration administered by the
American Arbitration Association ("AAA"). Plaintiff filed her arbitration claim
with the AAA on or about March 2, 2000. An arbitrator was appointed, and the
arbitration was scheduled for September 8, 2000. The arbitration date was
suspended by the AAA, and, as of this time, has not been rescheduled. The court
case was dismissed by the court for failure by the plaintiff to appear at an
arbitration review conference. Plaintiff has filed a motion to vacate the
dismissal, which motion was granted by the court following a hearing on January
23, 2001. The matter remains in private arbitration before the AAA, with a
hearing to be rescheduled for sometime later this year.

     Certain provisions of the Company's Certificate of Incorporation and
indemnification agreements between the Company and its officers require the
Company to advance to such officers ongoing legal expenses of defending the
above lawsuits and may require the Company to indemnify them against judgments
rendered on certain claims. The Company may incur significant legal expenses on
its behalf and on behalf of such officers in connection with this litigation. In
addition, defending this litigation has resulted, and will likely continue to
result, in the diversion of management's attention from the day-to-day
operations of the business. There can be no assurance that this stockholder
litigation will be resolved in the Company's favor. An adverse result,
settlement or prolonged litigation would have a material adverse effect on the
business, financial condition, results of operations or cashflows.

  NASDAQ INQUIRY

     On December 19, 2000, the Company received notice from NASDAQ that the
Company's common stock had failed to maintain a minimum bid price of $1.00 over
the prior thirty consecutive trading days as required by NASDAQ National
Marketplace Rules (the "Rules"). The Company had until March 19, 2001 to regain
compliance with the Rules or the Company's common stock would be subject to
delisting from

                                        11
<PAGE>   13
                              INGENUUS CORPORATION

      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                  (UNAUDITED)

NASDAQ. Regaining compliance required, in part, that the Company's common stock
trade at of above the $1.00 minimum price for ten consecutive trading days.

     On March 20, 2001, the Company received notice from NASDAQ that the
Company's common stock had failed to maintain NASDAQ's minimum bid price closing
requirement of $1.00 and that such failure had continued beyond the ninety day
probationary period allowed under the Rules. The letter specified that, as a
result of the Company's failure to maintain the minimum bid price closing
requirement, the Company's common stock would be delisted at the close of
business on March 28, 2001. However, the Company appealed the decision, and the
delisting was stayed pending a hearing before the NASDAQ Qualifications Panel
(the "Panel") on May 3, 2001.

     On June 15, 2001 the Company was notified that the Panel had granted
Ingenuus continued listing of the Company's securities on The NASDAQ National
Market pursuant to an exception that the Company had until June 26, 2001 to file
proxy materials with the SEC and NASDAQ that included a proposal for a reverse
stock split, and further that the Company had until July 26, 2001 to demonstrate
a closing bid price of at least $1.00 per share and maintain such price for a
minimum of ten consecutive trading days thereafter. This proposal for a reverse
stock split was subject to approval by Ingenuus stockholders at a special
stockholders meeting held on July 24, 2001.

     The stockholders did not approve the reverse stock split proposal and the
Company's stock was voluntarily delisted from NASDAQ on July 26, 2001.

                                        12
<PAGE>   14

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

INTRODUCTION

     This section -- Management's Discussion and Analysis of Financial Condition
and Results of Operations -- contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended. These forward-looking
statements are based on current expectations and include various risks and
uncertainties that could cause actual results to differ materially from those
projected. Such risks and uncertainties are set forth below and under "Other
Factors Affecting Future Operating Results."

COMPANY OVERVIEW

     During 2000, Ingenuus Corporation underwent a fundamental and rapid shift
in business when it changed its name from Aspec Technology to Ingenuus
Corporation (the "Company"), and sold its Semiconductor Intellectual Property
("SIP") business.

     The Company's SIP libraries consisted of logic functions based on gate
array/embedded array or standard cell, I/Os and memories. SIP design tools
included memory compilers, which allowed customers to generate memory libraries,
as well as AdverPro software that managed the design process, provided an
accurate timing function across Electronic Design Automation ("EDA") tools, and
helped ensure compliance through proper design procedures.

     Along with the sale of its SIP libraries, the Company sold SIS
Microelectronics Corporation ("SIS"), which had been acquired in April 1998 and
had accounted for 34% of the Company's revenue in 1999. SIS delivered integrated
system-level silicon solutions that combined the Company's extensive chip design
experience with proprietary and partner intellectual property.

     The Company turned to EDA tools that would help engineers solve design
problems. In late 1999, the Company purchased three research and development
companies including Chip & Chip Inc. ("Chip & Chip"), Verilux Design Technology
("Verilux") and Novo Systems ("Novo") for their technology and expertise.

     Additionally, the Company purchased Inbox Software, Inc. ("Inbox"), a
business-to-business software company that provided an automated product capable
of managing document and engineering changes.

     In June 2000, the Company sold Chip & Chip and August 31, 2001,
discontinued Verilux.

     Using InBox and the power of the Internet, the Company retooled existing
technology into the Manufacturing Change Manager(TM) ("MCM") software solution
that allows manufacturers to take control and command of the manufacturing
change lifecycle. Today, all of the Company's energy is focused on MCM and
intelligent e-business solutions. The Company's core competency is providing
manufacturing centric, automated solutions that enable users to collaborate and
share intellectual production and process data enterprise wide through the use
of the Internet providing faster time to market, faster time to volume, and
faster time to greater profits.

CLIENTS AND PARTNERS

     Many world-class manufacturing companies have started to enjoy the benefits
of taking control and command of the product life cycle management, such as:

     - Agere

     - CIDCO Communications

     - Elantec Semiconductor

     - Hello Direct

     - Invensys

                                        13
<PAGE>   15

     - Mattson Technology

     - Pericom Semiconductor

     - Symmetricom

     - Target Tharapeutics

     The Company has established alliances with such top industry leaders as
Oracle and Perot Systems. In addition, we are a member of the Supply-Chain
Council, an industry organization established in 1996 to create standards and
improve supply chain processes among manufacturers, suppliers, distributors and
retailers.

THE MARKET

     We are focusing on change management generally associated with
Collaborative Product Commerce ("CPC"), a second-generation e-business strategy
surrounding the entire lifecycle of a product.

     The audience for such software include discrete and process manufacturers
that want to communicate with supply chains around the world in a new way.

     Traditionally, information along the manufacturing supply chain has
remained internal, with parts and pieces being divided among various groups that
make up the manufacturing process. Many of these companies use the Internet
during the process, but only as a publishing medium.

ABOUT CPC AND C-COMMERCE

     Electronic Commerce, now globally accepted as e-commerce, is the electronic
trade of goods and services. Over the past several years, e-commerce has enabled
companies to conduct business online with secure and scalable order capture,
management and routing. More and more people are using e-commerce to purchase
products through the Internet.

     Electronic Data Interchange ("EDI"), or the electronic communication of
business transactions between organizations, formed the foundation of
e-commerce.

     Collaborative commerce, or c-commerce is the second generation of
e-commerce solutions, providing the value and power of its predecessor. While
e-commerce focuses on cost reduction, c-commerce focuses on new revenue
opportunities by bringing more innovative products to market faster than the
competition.

     Collaborative Product Commerce ("CPC") is a class of software and services
that uses Internet technology to permit individuals to collaboratively share
intellectual data improving the development, manufacture and management of
products throughout the entire life cycle. CPC delivers two primary benefits; it
improves quality and capability by connecting islands or pockets of product
knowledge into a single, extended experience base; and it collapses time and
distance variables using the Internet to gain faster time to market.

INTRODUCING THE MANUFACTURING CHANGE MANAGER(TM)

     MCM handles the life cycle of changes initiated from almost any point in
the supply chain, including:

     - Customer change request/order ("CCR/CCO")

     - Supplier change request/order ("SCR/SCO")

     - Manufacturing change order ("MCO")

     - ISO change request/order ("ICR/ICO")

     - Engineering change request/order ("ECR/ECO")

     - Variation change order ("VCO")

                                        14
<PAGE>   16

     - Continuous Improvement Initiatives ("CII")

     - Cost of change ("COC")

     With MCM, the manufacturing change process is automated, from start to
finish. The process happens in real time over the Internet.

     MCM manages change from various sources, including manufacturers,
suppliers, engineers, purchasers, quality control, ISO, customers, employee
change requests and other types of change.

CONSULTING SERVICES

     While MCM is expected to be our main revenue source in 2001, we also expect
to derive revenue from delivery of professional services. Consultants will help
clients define and refine internal change management processes, and help them
better leverage their technology. Some professional services include:

     - System architecture and design

     - Ingenuus software installation and configuration

     - Enterprise Resource Planning ("ERP") integration. (ERP consists of large
       relational databases that generate data based on their own language.)

     - Computer Aided Design ("CAD") integration

     - Data conversion

     - Product training

     Costs for these professional consulting services are fixed. The process
involves a review of the total project, the development of a phased
implementation schedule, and project planning specific to the client's
environment.

MAINTENANCE SERVICES

     We offer standard support services, which include product updates,
telephone and Internet support. Custom support services are also available,
including standard support services plus technical management, application and
educational services.

RESULTS OF CONTINUING OPERATIONS

     The Company's Ingenuus business unit was formed with the acquisition and
merger of Novo in October 1999 and Inbox, in December 1999. Inbox's products
provide intelligent Internet-enabled, business-to-business, IEC content
management applications which shorten time-to-market by developing, capturing,
transferring, sharing and leveraging the corporate expertise required to deliver
and maintain content throughout the content supply chain whereas Novo provides
system maintenance services. Ingenuus segment's activities for the three and
nine month periods ended August 31, 2001, excluding amortization of goodwill,
involved primarily activities surrounding product revenues from the Inbox
business, system maintenance revenue from the Novo business, research and
development expenditures, sales and marketing and general administrative
expenses.

     The EDA segment which included the development and sale of software tools
for Electronic Design Automation, related to Verilux Design Technology
("Verilux") was discontinued as of August 31, 2001.

                                        15
<PAGE>   17

RESULTS OF OPERATIONS

     The following table sets forth selected statements of operations data
expressed both in dollars (in thousands) and as a percentage of revenue for the
three and nine month period ending August 31, 2001 compared to the period ended
August 31, 2000:

                              INGENUUS CORPORATION

                            STATEMENT OF OPERATIONS
                                    DOLLARS
                                 (IN THOUSANDS)
                                  (UNAUDITED)

<Table>
<Caption>
                                                               QUARTER ENDED    NINE MONTHS ENDED
                                                              AUGUST 31, 2001    AUGUST 31, 2001
                                                              ---------------   -----------------
                                                                 INGENUUS           INGENUUS
                                                              ---------------   -----------------
<S>                                                           <C>               <C>
Revenue.....................................................      $   366              1,320
Cost of revenue.............................................          599              2,024
                                                                  -------           --------
Gross profit (loss).........................................         (233)              (704)
                                                                  -------           --------
Operating expenses:
  Research and development..................................          526              1,925
  Sales and marketing.......................................        1,384              4,137
  General and administrative................................          877              3,365
  Amortization -- goodwill..................................          834              2,502
                                                                  -------           --------
          Total operating expenses..........................        3,621             11,929
(Loss) from operations......................................       (3,854)           (12,633)
Interest and other income, net..............................          547                712
Gain on sale of investment..................................           43              5,935
                                                                  -------           --------
(Loss) from continuing operations...........................       (3,264)            (5,986)
(Loss) from discontinued operations.........................         (145)              (524)
Gain(loss)on disposal of discontinued operations............         (705)              (705)
Provision for income taxes..................................            2                  5
                                                                  -------           --------
     Net loss...............................................      $(4,116)          $ (7,220)
                                                                  =======           ========
</Table>

                                        16
<PAGE>   18

                              INGENUUS CORPORATION

                            STATEMENT OF OPERATIONS
                                 (PERCENTAGES)
                                  (UNAUDITED)

<Table>
<Caption>
                                                               QUARTER ENDED    NINE MONTHS ENDED
                                                              AUGUST 31, 2001    AUGUST 31, 2001
                                                              ---------------   -----------------
                                                                 INGENUUS           INGENUUS
                                                              ---------------   -----------------
<S>                                                           <C>               <C>
Revenue.....................................................         100%              100%
Cost of revenue.............................................         164%              153%
                                                                  ------              ----
Gross profit (loss).........................................         (64)%             (53)%
                                                                  ------              ----
Operating expenses:
  Research and development..................................         144%              146%
  Sales and marketing.......................................         378%              313%
  General and administrative................................         239%              255%
  Amortization -- goodwill..................................         228%              190%
                                                                  ------              ----
          Total operating expenses..........................         989%              904%
(Loss) from operations......................................      (1,053)%            (957)%
Interest and other income, net..............................         149%               54%
Gain on sale of investment..................................          12%              450%
Losses from joint venture...................................          --                --
                                                                  ------              ----
(Loss) from continuing operations...........................        (892)%            (453)%
(Loss) from discontinued operation..........................         (40)%             (40)%
(Loss) on disposal of discontinued operations...............        (193)%             (54)%
                                                                  ------              ----
          Net loss..........................................      (1,125)%            (547)%
                                                                  ======              ====
</Table>

                                        17
<PAGE>   19

                              INGENUUS CORPORATION

                            STATEMENT OF OPERATIONS
                                    DOLLARS
                                 (IN THOUSANDS)
                                  (UNAUDITED)

<Table>
<Caption>
                                                               QUARTER ENDED    NINE MONTHS ENDED
                                                              AUGUST 31, 2000    AUGUST 31, 2000
                                                              ---------------   -----------------
                                                                 INGENUUS           INGENUUS
                                                              ---------------   -----------------
<S>                                                           <C>               <C>
Revenue.....................................................      $   951           $  2,262
Cost of revenue.............................................          738              2,313
                                                                  -------           --------
Gross profit (loss).........................................          213                (51)
                                                                  -------           --------
Operating expenses:
  Research and development..................................          794              1,971
  Sales and marketing.......................................          853              1,773
  General and administrative................................        1,042              5,188
  Write off of Purchased Technology.........................           --                925
  Amortization -- goodwill..................................          928              2,724
                                                                  -------           --------
          Total operating expenses..........................        3,617             12,581
(Loss) from operations......................................       (3,404)           (12,632)
Interest and other income, net..............................          242                649
Gain on sale of investment..................................           --                 --
(Losses) from joint venture.................................           --                (67)
                                                                  -------           --------
(Loss) from continuing operations...........................       (3,162)           (12,050)
(Loss) from discontinued operations.........................         (112)            (4,662)
Gain/(Loss) on disposal of discontinued operations..........          (70)             5,363
                                                                  -------           --------
          Net loss..........................................      $(3,344)          $(11,349)
                                                                  =======           ========
</Table>

                                        18
<PAGE>   20

                              INGENUUS CORPORATION

                            STATEMENT OF OPERATIONS
                                 (PERCENTAGES)
                                  (UNAUDITED)

<Table>
<Caption>
                                                               QUARTER ENDED    NINE MONTHS ENDED
                                                              AUGUST 31, 2000    AUGUST 31, 2000
                                                              ---------------   -----------------
                                                                 INGENUUS           INGENUUS
                                                              ---------------   -----------------
<S>                                                           <C>               <C>
Revenue.....................................................        100%               100%
Cost of revenue.............................................         78%               102%
                                                                   ----               ----
Gross profit (loss).........................................         22%                (2)%
                                                                   ----               ----
Operating expenses:
  Research and development..................................         83%                87%
  Sales and marketing.......................................         90%                78%
  General and administrative................................        110%               230%
  Write off of Purchased Technology.........................         --                 41%
  Amortization -- goodwill..................................         97%               121%
                                                                   ----               ----
          Total operating expenses..........................        380%               557%
(Loss) from operations......................................       (358)%             (559)%
Interest and other income, net..............................         25%                29%
(Losses) from joint venture.................................         --                 (3)%
                                                                   ----               ----
(Loss) from continuing operations...........................       (333)%             (533)%
(Loss) from discontinued operations.........................        (12)%             (206)%
Gain/(Loss) on disposal of discontinued operations..........         (7)%              237%
                                                                   ----               ----
          Net loss..........................................       (352)%             (502)%
                                                                   ====               ====
</Table>

                                        19
<PAGE>   21

     Revenue.  Revenues for Ingenuus decreased by 62% from $951,000 in the
quarter ended August 31, 2000, to $366,000 in the quarter ended August 31, 2001
and 41% from $2.3 million in the nine months ended August 31, 2000 to $1.3
million in the nine months ended August 31, 2001. The decrease in revenue is
related to the slowing of the economy.

     Cost of revenue.  Cost of revenues for Ingenuus decreased by 19% from
$738,000 in the quarter ended August 31, 2000, to $599,000 in the quarter ended
August 31, 2001 and 13% from $2.3 million in the nine months ended August 31,
2000 to $2.0 million in the nine months ended August 31, 2001. Cost of revenues
as a percentage of revenue increased by 86% from 78% of revenue for the three
months ended August 31, 2000 to 164% of revenue for the three months ended
August 31, 2001. Cost of revenue as a percentage of revenues increased by 51%
from 102% of revenues for the nine months ended August 31, 2000 to 153% of
revenues for the nine months ended August 31, 2001. Cost of revenue for Ingenuus
primarily represents the costs of products, personnel, amortization of acquired
Inbox technology and other operating expenses incurred in providing services to
the customers. The decrease in absolute dollar amounts from three and nine
months ended August 31, 2001 as compared to August 31, 2000 was mainly due to
decrease in salary expenses. The increase in cost of revenues as a percentage of
revenue was due to the fact that the volume of products sold was lower than
anticipated. Ingenuus Corporation has built up a professional and customer
services team for the anticipated revenue.

     Research and development.  Research and development expenses represent the
cost of engineering personnel and other operating expenses incurred in the
development and enhancement of our core technology. Research and development
expenses for Ingenuus decreased by 34% from $794,000 in the quarter ended August
31, 2000 to $526,000 in the quarter ended August 31, 2001. Research and
development expenses for Ingenuus decreased by 2% from $2.0 million in the nine
months ended August 31, 2000 to $1.95 million in the nine months ended August
31, 2001. Research and development expenses as a percentage of revenue was 83%
in the quarter ended August 31, 2000 compared to 144% in the quarter ended
August 31, 2001. Research and development expenses as a percentage of revenue
was 87% in the nine months ended August 31, 2000 compared to 146% in the nine
months ended August 31, 2001. The absolute dollar decrease in research and
development expenses in the quarter ended August 31, 2001, compared with the
quarter ended August 31, 2000, was mainly due to decrease in salary expenses of
$52,000, and decrease in consulting expenses of $173,000 as a result of reduced
headcount of both employees and consultants in fiscal 2001. The increase in
research and development expenses as a percentage of revenue was due to the fact
that the volume of products sold was lower than anticipated.

     Sales and marketing.  Sales and marketing expenses consist of salaries and
commissions paid to internal sales and marketing personnel and sales
representatives, promotional costs and related operating expenses. Sales and
marketing expenses for Ingenuus increased by 62% from $853,000 in the quarter
ended August 31, 2000, to $1.4 million in the quarter ended August 31, 2001.
Sales and marketing expenses for Ingenuus increased by 128% from $1.8 million in
the nine month ended August 31, 2000, to $4.1 million in the nine month ended
August 31, 2001. Sales and marketing expense, as a percentage of revenue was 90%
in the quarter ended August 31, 2000 and 378% in the quarter ended August 31,
2001. Sales and marketing expense, as a percentage of revenue was 78% in the
nine months ended August 31, 2000 and 313% in the nine months ended August 31,
2001. The absolute dollar increase in sales and marketing expenses in the
quarter ended August 31, 2001, compared with the quarter ended August 31, 2000,
was mainly due to an increase of salary expenses of $203,000 as more sales staff
were added in fiscal 2001, and increase in marketing expenses of $316,000
relating to advertising and promotion of our Ingenuus products. The absolute
dollar increase in sales and marketing expenses in the nine months ended August
31, 2001, compared with the nine months ended August 31, 2000, was mainly due to
an increase in salary expenses of $759,000, increase in recruiting expenses of
$250,000, and increase in travel expenses of $106,000 as more sales staff were
added in fiscal 2001,and increase in marketing expenses of $820,000 relating to
advertising and promotion of our Ingenuus products. The increase in sales and
marketing expenses as a percentage of revenue was due to the fact that the
volume of products sold was lower than anticipated.

     General and administrative.  General and administrative expenses consist of
salaries and expenses related to executives, corporate finance, legal and human
resources departments. General and administrative
                                        20
<PAGE>   22

expenses, decreased by 12% from $1.0 million in the quarter ended August 31,
2000, to $877,000 in the quarter ended August 31, 2001. General and
administrative expenses, decreased by 35% from $5.2 million in the nine months
ended August 31, 2000, to $3.4 million in the nine months ended August 31, 2001.
General and Administrative expenses as a percentage of revenue was 110% in the
quarter ended August 31, 2000 and 239% in the quarter ended August 31, 2001.
General and Administrative expenses as a percentage of revenue was 230% in the
nine months ended August 31, 2000 and 255% in the nine months ended August 31,
2001. The absolute dollar decrease in general and administrative expenses in the
nine months ended August 31, 2001, compared with the nine months ended August
31, 2000, was mainly due to decrease in salary expenses of $1.5 million as a
result of reduced headcount and lower fees related to professional services and
legal expenses of $204,000.

     The Company also recorded $834,000 in amortization expenses in the third
quarter of fiscal 2001, and $928,000 in the third quarter of fiscal 2000,
related to acquisitions in the last two years.

     Interest, and other income net.  Net interest and other income for Ingenuus
increased 126% from $242,000 in the three months ended August 31, 2000 to
$547,000 in the three months ended August 31, 2001. The increase in net interest
income in the three months ended August 31, 2001 as compared to three months
ended August 31, 2000 was from interest of $398,000, related to income tax
refund. This was partly offset by reduction in interest income from our
investments since our cash balance has declined from Q3 2000 to Q3 2001.

     Foreign Currency.  Balance sheet accounts of Ingenuus's foreign subsidiary
in Japan are translated into U.S. dollars at exchange rates prevailing at
balance sheet dates. Revenue, costs and expenses are translated into U.S.
dollars at average rates for the period. Gains and losses resulting from foreign
exchange transactions are included in the statement of operations and were not
significant during the period presented.

LIQUIDITY AND CAPITAL RESOURCES

     We have funded our operations primarily from license revenue and the net
proceeds of $71.9 million from the initial public offering of our common stock
in May 1998.

     Our operating activities utilized net cash of $11.0 million in the
nine-month period ended August 31, 2001 and $11.5 million in the nine-month
period ending August 31, 2000. Net cash used for operating activities in the
first nine months of fiscal 2000 and 2001 was due to the significant net losses
incurred for these periods.

     Net cash provided from investing activities was $6.7 million, in the
nine-month period ending August 31, 2001. Net cash used in investing activities
was $10.1 million, in the nine-month period ending August 31, 2000. Investing
activities for the nine months period ending August 31, 2001 included $6.7
million received from the sale of shares of Virage Logic. Net cash used in
nine-month period ending August 31, 2000 consisted primarily of $7.6 million
investment in Inbox, $2.8 million in purchases of property and equipment and was
partly offset by $296,000 received from sale of property and equipment.

     Net cash used by financing activities was $155,000 in the nine-month period
ending August 31, 2001. Net cash provided by financing activities was $399,000
in the nine-month period ended August 31, 2000. Net cash used in nine months
period ending August 31, 2001 consisted primarily of repurchase of common stock.
Net cash provided from financing activities in nine-month period ending August
31, 2000 was from proceeds from issuance of common stock.

     At August 31, 2001, we had cash and cash equivalents of $7.3 million. As of
August 31, 2001, we had a retained deficit of $81.9 million and working capital
of $5.2 million.

     We have suffered recurring losses in fiscal 2000, 1999 and 1998. Our
continued existence is dependent on our ability to achieve profitable
operations. We intend to continue to invest in the development of new

                                        21
<PAGE>   23

products and enhancements to our existing products. Our future liquidity and
capital requirements will depend upon numerous factors, including:

     - the costs and timing of our product development efforts and the success
       of these development efforts,

     - the costs and timing of our sales and marketing activities,

     - the extent to which our existing and new products gain market acceptance,

     - competing technological and market developments,

     - the costs involved in maintaining and enforcing patent claims and other
       intellectual property rights.

     Based on our budget, we believe that our current cash and investment
balances together with any cash generated from operations will be sufficient to
meet our operating and capital requirements for at least the next twelve months.
We may require additional funds in the future and there is a risk that financing
may not be on terms favorable to us, if available at all.

OTHER FACTORS AFFECTING FUTURE OPERATING RESULTS

  POSSIBLE CHALLENGES TO SUCCESS

  We May Not Be Successful in Marketing the MCM Product

     Our future depends on our ability to enhance and expand our MCM product,
and to introduce new products as technology allows. There is still no assurance
that we will be successful in marketing the MCM product. We may also experience
release delays that are costly, can harm our business and can result in possible
litigation. Other possible risks include:

     - Manufacturers resisting change,

     - Companies and customers lacking cash due to inflation or other economic
       shifts,

     - Miscalculating the need for the MCM product if manufacturers are not
       ready to enjoy the benefits of a fully automated system,

     - Misappropriation of the Company's technology or copyright infringement,

     - Diversion of resources due to litigation, including propriety rights
       issues.

  The Introduction of a Competing Product by a Large Company Could Have an
  Adverse Effect on Sales

     We must deliver the MCM product to the marketplace before a competing
company provides a similar whole solution. If a competitor with better name
recognition were to produce a comprehensive manufacturing change product, it
could have an adverse effect on our financial condition.

  If We do Not Establish Our Name in the Industry, Our Business Could Be Harmed

     We are a small, relatively unknown company and, as such, we are a new
player in the manufacturing change marketplace. There may be resistance to
purchasing a product from such a new player because there may be concern about
our viability. If customers resist the idea of having an unknown company supply
their manufacturing change needs, such resistance could have an adverse effect
on our financial condition.

  If We do Not Establish a Firm Customer Base, Our Business Could Be Harmed

     If our sales team is not successful in closing sales with major
manufacturers, this will have an adverse effect on our overall sales plan and on
the financial condition of the company.

                                        22
<PAGE>   24

  The Manufacturing Industry May Resist Changing to Our Platform

     Manufacturers have invested substantial funds in systems that are already
in place and may resist the idea of a basic platform, fearing that it may be not
flexible enough to meet their individual needs. Such resistance may have an
adverse effect on our financial condition.

  Product Defects May Harm Our Business

     Like any new software product, the MCM software may have some "bugs" or
defects that could appear after a company has purchased and installed the
software. Such occurrences could have an adverse effect on our financial
condition because the customer may be unsatisfied, there may be additional labor
costs incurred in fixing it, and shipments of other products may be delayed.

  A Recession or Economic Downfall Would Harm Our Business

     If a recession or economic downfall occurs, it will mean difficult times
for most companies and may have an adverse effect on our financial condition.

     In addition, terrorist acts or acts of war (wherever located around the
world) may cause damage or disruption to our business, employees, supplies,
distributors and resellers, and customers that could have an adverse effect on
our operations and financial results.

  Risks of Our International Sales Could Harm Our Business

     While we continue to market our products to the international market, there
are a number of risks inherent when dealing with foreign companies. Some of
those risks include:

     - Economic recessions and political instability,

     - Exchange rate fluctuations,

     - Extended accounts receivables and difficulty collecting,

     - Difficulty in managing both sales representatives and distributors,

     - Unexpected changes in regulatory requirements,

     - Reduced or limited protection for intellectual property rights,

     - Export license requirements and documentation, and

     - Tariffs and possible adverse tax consequences.

  Our Future Operating Results Are Expected To Fluctuate and We Depend Upon
  Timely Project Completion

     Our operating results have fluctuated in the past and are expected to
fluctuate significantly on a quarterly and annual basis in the future as a
result of a number of factors including:

     - the size and timing of customer orders,

     - the length of our sales cycle,

     - the timing of new product announcements and introductions by us and our
       competitors,

     - our ability to successfully develop, introduce and market new products
       and product enhancements,

     - market acceptance of our products,

     - the cancellation or delay of orders from major customers,

     - the level of changes to customer requirements due to specific changes
       requested by customers,

     - our ability to retain our existing personnel and hire additional
       personnel, and

     - general economic conditions.

                                        23
<PAGE>   25

     These and other factors could have a material adverse effect on our
business, operating results and financial condition.

     In addition, our contracts may generally be canceled without cause, and if
a customer cancels or delays performance under any such contracts, our business,
operating results and financial condition could be materially adversely
affected.

     A customer's license of our products may involve a significant commitment
of capital with the attendant delays frequently associated with authorization
procedures for capital expenditures within customer organizations. Our operating
expenses will be based in part on our expectations of future revenue from
product licenses. Accordingly, if we do not realize our expected revenues, our
business, operating results, and financial condition could be materially
adversely affected.

  Any Acquisitions May Not Be Successful

     From time to time, we expect to evaluate potential acquisitions to build
our expertise. There can be no assurance that:

     - we will be able to identify attractive acquisition candidates,

     - that we will be able to successfully complete any such acquisition, or

     - that we will be able to integrate any acquired company with our other
       operations.

     In connection with potential acquisitions, the failure to successfully and
efficiently integrate new employees and operations of the acquired company with
our existing employees and operations or to successfully manage an acquired
company could materially and adversely affect our business, operating results,
and financial condition.

  We Depend Upon Continuous Product Development and Have the Risk of Product
  Delays.

     Our customers are subject to:

     - rapid technological change,

     - frequent introductions of new products,

     - short product life cycles,

     - changes in customer demands and requirements, and

     - evolving industry standards.

  We Depend on Key Personnel.

     Our business depends in significant part on the continued service of our
executive officers and other senior management and key employees, including
certain technical, managerial and marketing personnel. The loss of the services
of any of these individuals or groups of individuals could have a material
adverse effect on our business, operating results and financial condition. None
of our executive officers have an employment agreement with us.

     We believe that our future business results will depend in significant part
upon our ability to identify, attract, motivate and retain additional highly
skilled technical, managerial and marketing personnel and to hire replacements
for employees that leave us. Competition for such personnel in the computer
software industry is intense. We have currently engaged in a search for several
additional engineering personnel. There can be no assurance we will be
successful in identifying, attracting and retaining such personnel, and the
failure to do so could have a material adverse effect on our business, operating
results and financial condition.

                                        24
<PAGE>   26

  Our Share Price Is Volatile.

     Since our initial public offering in April 1998, the market price of our
Common Stock has been highly volatile and is expected to be significantly
affected by factors such as:

     - actual or anticipated fluctuations in our operating results,

     - our failure to meet or exceed published earnings estimates,

     - changes in earnings estimates or recommendations by securities analysts,

     - announcements of technological innovations,

     - new products or new contracts by us or our existing or potential
       competitors,

     - developments with respect to patents, copyrights or proprietary rights,

     - adoption of new accounting standards affecting the software industry, and

     - general market conditions.

     In addition, the stock market has from time to time experienced significant
price and volume fluctuations that have particularly affected the market prices
for the common stocks of technology companies which have often been unrelated to
the operating performance of such companies. These broad market fluctuations may
materially and adversely affect the market price of our common stock.

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

     We develop products in the United States and sell them worldwide. As a
result, our financial results could be affected by factors such as changes in
foreign currency exchange rates or weak economic conditions in foreign markets.
We currently have funds in foreign currency, which are translated to U.S.
dollars. Hence, strengthening of the dollar may result in a decrease in the
value when converted to U.S. dollars.

     Interest income is sensitive to changes in the general level of U.S.
interest rates, particularly since our investments are in short-term instruments
calculated at variable rates.

     We have established policies and business practices regarding our
investment portfolio to preserve principal while obtaining reasonable rates of
return without significantly increasing risk. We place our investments with high
credit quality issuers according to our investment policy. We do not use
derivative financial instruments in our investment portfolio. All investments
are carried at cost, which approximates market value. Due to the short-term
nature of our investments and the immaterial amount of our debt obligation, we
believe that there is no material exposure to interest fluctuation. Therefore,
no accompanying table has been provided.

                          PART II.  OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

CLASS ACTION LAWSUITS

     On July 1, 1998, a class action lawsuit, Howard Jonas, et al. v. Aspec
Technology, Inc., et al., No. CV-775037 ("the Jonas Complaint"), was filed in
the Superior Court for the State of California, County of Santa Clara. The Jonas
Complaint alleged that Aspec Technology, Inc. ("Aspec") and certain of its
officers, directors and the underwriters of the Company's initial public
offering, violated California Corporations Code Sections 25400 and 25500, and
California Business and Professions Code Sections 17200 and 17500 by making
false and misleading statements about Aspec's financial condition. The action
was purportedly brought on behalf of all persons who purchased Aspec stock
during the period from April 28, 1998 through June 25, 1998. On July 2, 1998,
July 27, 1998, and August 17, 1998, three additional complaints were filed in
state court against the Company and certain of its officers, directors, entitled
respectively, William Neuman, et al. v. Aspec Technology, Inc., et al., No.
CV-775089 ("the Neuman Complaint"); Martin L.

                                        25
<PAGE>   27

Klotz, on behalf of the Martin Klotz Defined Benefit Profit Sharing Plan, et al.
v. Aspec Technology, Inc., et al., No. CV-776065. In addition to alleging the
same violations of the Corporations Code as the three other complaints, the
Klotz Complaint also alleged violations of Sections 11, 12, and 15 of the
Securities Act of 1933, and a class period of April 28, 1998 through June 30,
1998. The complaints sought unspecified damages. A fifth similar complaint,
filed in federal court, was later dismissed.

     On January 29, 1999, the plaintiffs consolidated the pending class action
cases and filed a Consolidated Amended Complaint, styled Howard Jonas, et al. v.
Aspec Technology, Inc., et al., No. CV-775037. The Consolidated Amended
Complaint, which was purportedly brought on behalf of all persons who purchased
Aspec's stock between April 27, 1998 and June 30, 1998, alleged that Aspec and
certain of its officers and directors, as well as its underwriters, violated
Sections 25400 and 25500 of the California Corporations Code, and Sections 11
and 15 of the Securities Act of 1933 (except as to the underwriters). On June 7,
1999, Aspec and certain of the individual defendants filed demurrers to the
Consolidated Complaint (the "Aspec Defendants"). On June 9, 1999, the plaintiffs
filed a motion for summary adjudication of their claims against Aspec under
Section 11 of the Securities Act. The plaintiffs also moved to certify a
plaintiff class.

     On August 26, 1999, the court heard argument on the defendants' demurrers.
The court sustained the demurrers in part and overruled them in part.
Specifically, the court held that the plaintiffs had not pleaded their claims
under California Corporations Code Section 25400 with sufficient particularity
and granted plaintiffs leave to amend this claim. The court overruled the
defendants' demurrers to the Section 11 claim. Following that hearing,
plaintiffs withdrew their motion for summary adjudication. Thereafter plaintiffs
filed their First Amended Class Action Complaint, under seal, on October
18,1999.

     On January 11, 2000, the defendants filed demurrers to Count I of the First
Amended Complaint, which alleged claims under California Corporations Code
Sections 25400/25500. The Aspec Defendants demurred to Count I on the basis that
plaintiffs had not pleaded facts demonstrating that the defendants had acted
with scienter. The Aspec Defendants also moved to strike certain allegations in
the complaint. The motions were fully briefed, and the court heard oral argument
on defendants' demurrers and motion to strike, and plaintiffs' motion for class
certification on February 24, 2000. The court overruled the defendants'
demurrers, denied the motion to strike and took the motion for class
certification under submission. Thereafter, on March 13, 2000, the Aspec
Defendants answered the plaintiffs' unverified complaint, generally denying all
allegations and asserting affirmative defenses.

     On March 16, 2000, the court certified a plaintiff class. On that same
date, the Court found, sua sponte, that the case is complex, and pursuant to a
pilot program implemented in the Superior Court for Santa Clara County, assigned
it to a single judge for all purposes. The plaintiffs thereafter re-noticed
their motion for summary adjudication of their Section 11 claim; based on
stipulations between the parties, the defendants did not respond to the motion
and that motion has not been heard.

     The parties and non-party Deloitte & Touche LLP, Aspec's former auditor,
executed a Memorandum of Understanding, on or about December 1, 2000, with the
objective of settling the class action litigation. On August 17, 2001, the court
issued various orders, including an order of final judgment approving the
settlement and dismissing the case with prejudice as to all defendants. Pursuant
to the terms of the settlement agreement and the court's order, Aspec (now known
as Ingenuus Corporation) paid $1.4 million into the settlement fund, and
thereafter, issued 1.75 million shares of common stock to the plaintiff class.

     As of November 30, 2000, the settlement cost has been accrued, including
the stock element, using a price of $0.50 per share, the fair market value of
the Company's common stock at November 30, 2000.

DERIVATIVE LAWSUIT

     Certain of the Company's current and former officers, directors and
shareholder entities were also named as defendants in a derivative lawsuit
styled Linda Willinger, IRA, et al. v. Conrad Dell'Oca et al., No. CV-778007,
filed on November 12, 1998, in the Superior Court of Santa Clara County. The
derivative action alleges facts similar to those in the class action and also
alleges that certain of the directors caused the Company to conduct the initial
public offering in order to redeem preferred stock they owned or in which they

                                        26
<PAGE>   28

had a beneficial interest. Aspec filed a demurrer to that Complaint on June 8,
1999 on behalf of certain of the officer and director defendants and nominal
defendant ("Aspec"). Thereafter, the plaintiffs requested defendants' assent to
the dismissal of their complaint and the filing of an amended complaint.
Derivative Plaintiffs filed their First Amended Shareholders' Derivative
Complaint on September 2, 1999.

     The Aspec Defendants demurred to that complaint on November 12, 1999, on
the basis that the nominal plaintiffs had failed to make a demand on the Board
of Directors before filing the derivative lawsuit, and that they had also failed
to plead sufficient facts to excuse a pre-suit demand. After the matter was
fully briefed, the court heard argument on January 25, 2000. On January 27,
2000, the court sustained the defendants' demurrers with sixty days' leave to
amend.

     The parties later stipulated that the plaintiffs would have additional time
in which to file an amended complaint, as well as to re-notice a motion to
compel the production of electronically-stored documents and records from Aspec,
as well as to notice the deposition of a witness from the Company to testify
concerning the storage of such documents and records.

     On or about December 1, 2000 certain of the defendants, including nominal
defendant, Aspec (now Ingenuus), the plaintiffs, and non-party Deloitte & Touche
LLP, the Company's former auditor, executed a Memorandum of Understanding, with
the objective of settling the derivative litigation.

     On February 23, 2001, at a hearing before Judge Conrad Rushing, the parties
advised the Court that they had reached agreement on a Stipulation of
Settlement, which they provided to the Court. The settlement would fully and
finally settle and resolve the derivative litigation, including a dismissal of
the action with prejudice as to all defendants. The Stipulation requires the
Company to pay the derivative plaintiffs' attorneys' fees in the amount of
$395,000, as well as to make certain changes to the Company's audit committee
charter. Upon the effective date, which includes the occurrence of the effective
date of the separate Stipulation of Settlement to be approved by the Court in
the Class Action, the parties to the Stipulation in the derivative litigation
will release one another from claims arising from or relating to the derivative
action, as set forth in the Stipulation. Thereafter, on March 6, 2001, the Court
entered an Order approving the Stipulation of Settlement and dismissing the
matter with prejudice as to all defendants.

OTHER LITIGATION

     On June 21, 1999, a lawsuit entitled Cadabra Design Technology, Inc. v.
Aspec Technology, Inc., No. CV-782691, was filed in the Superior Court, County
of Santa Clara. Plaintiff's complaint sought damages in excess of $1 million for
an alleged breach of a commercial software licensing agreement entered into by
Cadabra Design Technology, Inc. ("Cadabra") and the Company on or about August
18, 1998. On August 6, 1999, the Company answered the complaint -- denying
liability and asserting various affirmative defenses -- and filed a
cross-complaint seeking damages according to proof and equitable relief for
breach of contract, conversion, and negligent misrepresentation on the part of
Cadabra. On February 16, 2000, the parties executed a Settlement Agreement and
General Release in the case, pursuant to which the Company paid Cadabra $600,000
in full and final satisfaction of all claims related to the parties' software
licensing agreement. On March 1, 2000, the case was dismissed in accordance with
the parties' Settlement Agreement.

     Aspec Technology, Inc. v. Compaq Computers, Inc. was filed on December 28,
1998 in the Superior Court of California, Santa Clara County, No. CV778943. By
the Company's complaint, they sought to collect the principal sum of $403,344,
plus interest, attorneys' fees and costs, from Compaq, alleging that Compaq had
breached a contract to purchase certain of the Company's library software.
Compaq filed a counter claim alleging that the Company had breached the contract
by failing to deliver in functional form the promised software on the schedule
promised, as well as alleging fraudulent misrepresentation relating to the
contract. The counter claim alleges unspecified damages in excess of $25,000. A
settlement was entered into under which Compaq paid the Company $185,000.
Dismissals of the lawsuit have been filed with the court by all parties.

     On September 23, 1999, a lawsuit entitled Lesley Nemeth v. Aspec Technology
Inc., was filed in Superior Court, County of Santa Clara No. DC 383204.
Plaintiff is a former consultant to the Company who seeks in

                                        27
<PAGE>   29

her complaint damages in the sum of $12,600 plus interest and attorneys' fees.
On November 23, 1999 the court ordered the matter to binding arbitration
administered by the American Arbitration Association ("AAA"). Plaintiff filed
her arbitration claim with the AAA on or about March 2, 2000. An arbitrator was
appointed, and the arbitration was scheduled for September 8, 2000. The
arbitration date was suspended by the AAA, and, as of this time, has not been
rescheduled. The court case was dismissed by the court for failure by the
plaintiff to appear at an arbitration review conference. Plaintiff has filed a
motion to vacate the dismissal, which motion was granted by the court following
a hearing on January 23, 2001. The matter remains in private arbitration before
the AAA, with a hearing to be rescheduled for sometime later this year.

     Certain provisions of the Company's Certificate of Incorporation and
indemnification agreements between the Company and its officers require the
Company to advance to such officers ongoing legal expenses of defending the
above lawsuits and may require the Company to indemnify them against judgments
rendered on certain claims. The Company may incur significant legal expenses on
its behalf and on behalf of such officers in connection with this litigation. In
addition, defending this litigation has resulted, and will likely continue to
result, in the diversion of management's attention from the day to day
operations of the business. There can be no assurance that this stockholder
litigation will be resolved in the Company's favor. An adverse result,
settlement or prolonged litigation would have a material adverse effect on the
business, financial condition, results of operations or cashflows.

NASDAQ INQUIRY

     On December 19, 2000, the Company received notice from NASDAQ that the
Company's common stock had failed to maintain a minimum bid price of $1.00 over
the prior thirty (30) consecutive trading days as required by NASDAQ National
Marketplace Rules (the "Rules"). The Company had until March 19, 2001 to regain
compliance with the Rules or the Company's common stock would be subject to
delisting from NASDAQ. Regaining compliance required, in part, that the
Company's common stock trade at of above the $1.00 minimum price for ten (10)
consecutive trading days.

     On March 20, 2001, the Company received notice from NASDAQ that the
Company's common stock had failed to maintain NASDAQ's minimum bid price closing
requirement of $1.00 and that such failure had continued beyond the ninety (90)
day probationary period allowed under the Rules. The letter specified that, as a
result of the Company's failure to maintain the minimum bid price closing
requirement, the Company's common stock would be delisted at the close of
business on March 28, 2001. However, the Company appealed the decision, and the
delisting was stayed pending a hearing before the NASDAQ Qualifications Panel
(the "Panel") on May 3, 2001.

     On June 15, 2001 the Company was notified that the Panel had granted
Ingenuus continued listing of the Company's securities on The NASDAQ National
Market pursuant to an exception that the Company had until June 26, 2001 to file
proxy materials with the SEC and NASDAQ that included a proposal for a reverse
stock split, and further that the Company had until July 26, 2001 to demonstrate
a closing bid price of at least $1.00 per share and maintain such price for a
minimum of ten (10) consecutive trading days thereafter. This proposal for a
reverse stock split was subject to approval by Ingenuus stockholders at a
special stockholders meeting held on July 24, 2001.

     The stockholders did not approve the reverse stock split proposal and the
Company's stock was voluntarily delisted from NASDAQ on July 26, 2001.

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

     A special meeting of the Company's stockholders was held on Tuesday, July
24, 2001 at 3:00 p.m., local time, at the Company's offices at 830 East Arques
Avenue, Sunnyvale, California. The purpose of the special meeting was to approve
an amendment and restatement of the Company's Restated Certificate of
Incorporation to effect a one-for-ten reverse split of the outstanding shares of
Company common stock. The affirmative vote of a majority of the outstanding
shares was necessary to approve the amendment to affect the reverse

                                        28
<PAGE>   30

stock split. There were 36,853,062 shares outstanding and entitled to vote at
the special meeting. A majority of that number did not vote in favor of the
amendment. The results of the stockholder vote were as follows:

<Table>
<Caption>
  VOTES FOR     VOTES AGAINST   ABSTAIN   BROKER NON-VOTES
-------------   -------------   -------   ----------------
<S>             <C>             <C>       <C>
16,888,524        7,224,353     59,930           0
</Table>

ITEM 5.  OTHER INFORMATION

     On December 19, 2000 the Company received notice from NASDAQ that the
Company's common stock had failed to maintain a minimum bid price of $1.00 per
share over the prior thirty days as required by the NASDAQ National Marketplace
Rules (the "Rules"). The Company held a special meeting of the Company's
stockholders on July 24, 2001 to approve an amendment and restatement of the
Company's Restated Certificate of Incorporation to effect a one-for-ten reverse
stock split of the Company's common stock in order to bring the bid price of the
common stock into compliance with the Rules. The stockholders did not approve
the stock split at that meeting, and on July 26, 2001 the Company's common stock
was voluntarily delisted from NASDAQ.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

     (a) Exhibits

        None.

     (b) Reports on Form 8-K

        None.

                                        29
<PAGE>   31

                                   SIGNATURES

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

                                          INGENUUS CORPORATION

                                          BY:      /s/ DOUGLAS E. KLINT
                                             -----------------------------------
                                                      Douglas E. Klint
                                               Vice President, Secretary, and
                                                       General Counsel

Date: October 15, 2001

                                        30