<PAGE>   1

================================================================================

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

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

                                    FORM 10-Q

             QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                        SECURITIES EXCHANGE ACT OF 1934
                  FOR THE QUARTERLY PERIOD ENDED MARCH 31, 1999

                           COMMISSION FILE NO. 1-9158

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

                             MAI SYSTEMS CORPORATION
             (Exact name of Registrant as Specified in its Charter)

           DELAWARE                                            22-2554549
 (State or other jurisdiction                               (I.R.S. Employer
of incorporation or organization)                         (Identification No.)


                               9601 Jeronimo Road
                            Irvine, California 92618
                     (Address of Principal Executive Office)


       Registrant's telephone number, including area code: (949) 598-6000

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

Indicate by check mark whether the registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months and (2) has been subject to such filing
requirements for the past 90 days.

Yes  X     No
    ---       ---

Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court.

Yes  X     No
    ---       ---

As of May 5, 1999 , 10,906,658 shares of the registrant's Common Stock, $0.01
par value, were outstanding.

================================================================================

<PAGE>   2

PART I - FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

                             MAI Systems Corporation
                      Condensed Consolidated Balance Sheets
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                   December 31,      March 31,
                                                                                      1998             1999
                                                                                   ------------      ---------
                                                                                      (dollars in thousands)
<S>                                                                                 <C>              <C>      
ASSETS

Current assets:
     Cash                                                                           $   2,029        $   2,772
     Receivables, less allowance for doubtful accounts of $3,323 in 1998
           and $3,429 in 1999                                                          14,492           19,674
     Inventories                                                                        1,390            1,264
     Prepaids and other assets                                                          2,919            3,428
                                                                                    ---------        ---------
              Total current assets                                                     20,830           27,138

Furniture, fixtures and equipment, net                                                  3,737            3,488
Intangibles, net                                                                       10,185            9,885
Other assets                                                                            1,005              904
                                                                                    ---------        ---------
              Total assets                                                          $  35,757        $  41,415
                                                                                    =========        =========
LIABILITIES AND STOCKHOLDERS' DEFICIENCY

Current liabilities:
     Current portion of long-term debt                                              $     859        $     682
     Accounts payable                                                                   7,289            6,550
     Customer deposits                                                                  2,587            3,212
     Accrued liabilities                                                                7,504            8,552
     Income taxes payable                                                                 587              548
     Unearned revenue                                                                  10,702           13,401
                                                                                    ---------        ---------
              Total current liabilities                                                29,528           32,945

Line of credit                                                                          3,277            3,742
Long-term debt                                                                          5,056            5,107
Other liabilities                                                                         262              261
                                                                                    ---------        ---------
              Total liabilities                                                        38,123           42,055
                                                                                    ---------        ---------
Stockholders' deficiency:
     Preferred Stock, par value $0.01 per share; 1,000,000 shares authorized,
         none issued and outstanding                                                       --               --
     Common Stock, par value $0.01 per share; authorized 24,000,000
         shares; 10,697,639 and 10,906,658 shares issued and issuable
         at December 31, 1998 and March 31, 1999, respectively                            110              112
     Additional paid-in capital                                                       219,780          220,287
     Accumulated other comprehensive income                                               713              721
     Accumulated deficit                                                             (222,969)        (221,760)
                                                                                    ---------        ---------
              Total stockholders' deficiency                                           (2,366)            (640)
                                                                                    ---------        ---------
              Total liabilities and stockholders' deficiency                        $  35,757        $  41,415
                                                                                    =========        =========
</TABLE>


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


                                     - 2 -
<PAGE>   3

                             MAI Systems Corporation
                 Condensed Consolidated Statements of Operations
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                 For the Three Months Ended
                                                                                          March 31,
                                                                                 --------------------------
                                                                                    1998            1999
                                                                                  --------        --------
                                                                                    (in thousands, except
                                                                                       per share data)
<S>                                                                               <C>             <C>     
Revenue:
     Software, networks and professional services:
           Software sales                                                         $  2,106        $  4,845
           Network and computer equipment                                            1,075             875
           Professional services                                                     7,165           7,187
                                                                                  --------        --------
                                                                                    10,346          12,907

     Legacy revenue                                                                  4,863           3,177
                                                                                  --------        --------
                    Total revenue                                                   15,209          16,084

Direct costs                                                                         8,034           7,016
                                                                                  --------        --------
                    Gross profit                                                     7,175           9,068

Selling, general and administrative expenses                                         6,244           5,836
Research and development costs                                                         965           1,202
Amortization and impairment of intangibles                                             615             610
Other operating (income) expense                                                       184             (41)
                                                                                  --------        --------
                    Operating income (loss)                                           (833)          1,461

Equity in net income (loss) of unconsolidated subsidiaries                             (49)             15
Interest income                                                                         30              30
Interest expense                                                                      (236)           (297)
                                                                                  --------        --------
                    Income (loss) before income taxes                               (1,088)          1,209

Provision for income taxes                                                              --              --
                                                                                  --------        --------
Net income (loss)                                                                 $ (1,088)       $  1,209
                                                                                  ========        ========
Income (loss) per share:

Basic income (loss) per share                                                     $  (0.11)       $   0.11
                                                                                  ========        ========

Diluted income (loss) per share                                                   $  (0.11)       $   0.11
                                                                                  ========        ========
Weighted average common shares used in determining income (loss) per share:

     Basic                                                                          10,298          10,836
                                                                                  ========        ========

     Diluted                                                                        10,298          10,925
                                                                                  ========        ========
</TABLE>


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


                                     - 3 -
<PAGE>   4

                             MAI Systems Corporation
                Condensed Consolidated Statements of Cash Flows
                                  (Unaudited)

<TABLE>
<CAPTION>
                                                                      For the Three Months Ended
                                                                               March 31,
                                                                      --------------------------
                                                                         1998           1999
                                                                        -------        -------
<S>                                                                     <C>            <C>    
Net cash provided by operating activities                               $ 1,861        $   126
                                                                        -------        -------
Cash flows from investing activities:

         Capital expenditures                                              (196)            (4)
         Capitalized software costs                                        (406)          (218)
                                                                        -------        -------

Net cash used in investing activities                                      (602)          (222)
                                                                        -------        -------

Cash flows from financing activities:

         Short-term borrowings, net                                          (8)           339
         Proceeds from issuance of common stock, net                         --            500
         Repayments of term and other long-term debt                       (187)            --
         Proceeds from the exercise of stock options and warrants            --              9
                                                                        -------        -------

Net cash (used in) provided by financing activities                        (195)           848
                                                                        -------        -------

Effect of exchange rate changes on cash and cash equivalents                  8             (9)
                                                                        -------        -------

Net change in cash and cash equivalents                                   1,072            743
                                                                        -------        -------

Cash and cash equivalents at beginning of period                          2,051          2,029
                                                                        -------        -------

Cash and cash equivalents at end of period                              $ 3,123        $ 2,772
                                                                        =======        =======
</TABLE>


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


                                     - 4 -
<PAGE>   5

                             MAI Systems Corporation
              Notes to Condensed Consolidated Financial Statements
                       Three months ended March 31, 1999
                                  (Unaudited)

1.       BASIS OF PRESENTATION

         Companies for which this report is filed are MAI Systems Corporation
         and its wholly-owned subsidiaries (the "Company"). The information
         contained herein is unaudited, but gives effect to all adjustments
         (which are normal recurring accruals) necessary, in the opinion of
         Company management, to present fairly the condensed consolidated
         financial statements for the interim period. All significant
         intercompany transactions and accounts have been eliminated in
         consolidation.

         Although the Company believes that the disclosures in these financial
         statements are adequate to make the information presented not
         misleading, certain information and footnote disclosures normally
         included in financial statements prepared in accordance with generally
         accepted accounting principles have been condensed or omitted pursuant
         to the rules and regulations of the Securities and Exchange Commission
         (the "SEC"), and these financial statements should be read in
         conjunction with the financial statements included in the Company's
         Annual Report on Form 10-K for the year ended December 31, 1998, which
         is on file with the SEC.

2.       INVENTORIES

         Inventories are summarized as follows:

<TABLE>
<CAPTION>
                              December 31,    March 31,
                                 1998           1999
                              ------------    ---------
                               (dollars in thousands)
<S>                             <C>           <C>   
        Finished goods          $  843         $  768
        Replacement parts          547            496
                                ------         ------
                                $1,390         $1,264
                                ======         ======
</TABLE>

3.       PLAN OF REORGANIZATION

         In 1993, the Company emerged from a voluntary proceeding under the
         bankruptcy protection laws. Notwithstanding the confirmation and
         effectiveness of its Plan of Reorganization (the "Plan"), the
         Bankruptcy Court continues to have jurisdiction to resolve disputed
         pre-petition claims against the Company to resolve matters related to
         the assumptions, assignment or rejection of executory contracts
         pursuant to the Plan and to resolve other matters that may arise in
         connection with the implementation of the Plan. 

         Shares of common stock may be distributed by the Company to its former
         creditors. As of May 5, 1999, 6,758,251 shares of Common Stock had been
         issued pursuant to the Plan and were outstanding. The Company estimates
         that approximately 6,820,338 shares will have been issued to creditors
         at completion of the Plan.

4.       BUSINESS ACQUISITIONS

         HOTEL INFORMATION SYSTEMS, INC. ("HIS"):

         During 1996, the Company entered into arbitration proceedings regarding
         the purchase price of HIS. The Company placed approximately 1,100,000
         shares of Common Stock issued in connection with the acquisition of HIS
         in an escrow account to be released in whole, or in part, upon final
         resolution of post closing adjustments.


                                     - 5 -
<PAGE>   6

         In November 1997, the purchase price for the acquisition of HIS was
         reduced by $931,000 pursuant to arbitration proceedings. As a result,
         goodwill was reduced $931,000 and approximately 100,650 price protected
         shares will be released from the escrow account and returned to the
         Company. In addition, further claims relating to legal costs and
         certain disbursements currently estimated at approximately $650,000 are
         presently pending. Resolution of such claims may result in release of
         additional escrow shares to the Company. The amount and number of
         shares will be determined based on the final resolution of such claims.
         Accordingly, as of March 31, 1999, the final purchase price has not
         been determined.

         The Company will, as needed, pursuant to the asset purchase agreement
         and related documents, issue additional shares of Common Stock in order
         that the recipients ultimately receive shares worth a fair value of
         $9.25 per share (subject to increase in such amount to approximately
         $11.18 per share). This adjustment applies to a maximum of 590,785
         shares of Common Stock. In April 1998, in accordance with the purchase
         agreement and related documents pursuant to which the Company acquired
         HIS in August 1996, the Company issued 246,453 additional shares of
         Common Stock valued at par. At March 31, 1999, the fair market value of
         the Company's Common Stock was $2.94 per share, which would result in
         approximately 1,657,718 additional shares being issued.

5.       COMMON STOCK

         On February 3, 1999, the Company's Chairman purchased 201,106 shares of
         the Company's Common Stock valued at $500,000.

6.       INCOME (LOSS) PER SHARE OF COMMON STOCK

         Effective December 31, 1997, the Company adopted SFAS No. 128,
         "Earnings Per Share". This statement replaces the previously reported
         primary and fully diluted earnings per share with basic and diluted
         earnings per share. Unlike primary earnings per share, basic earnings
         per share excludes any dilutive effects of options. Diluted earnings
         per share is very similar to the previously reported fully diluted
         earnings per share. All loss per share amounts for all periods have
         been presented and restated to conform to the SFAS No. 128
         requirements.

         Basic and diluted loss per share is computed using shares of common
         stock issued to date and expected to be issued in accordance with the
         Plan of Reorganization ("Common Stock") as discussed in Note 3, and the
         weighted average shares of Common Stock issued outside the Plan of
         Reorganization. As of March 31, 1999, 6,758,251 shares had been issued
         pursuant to the Plan of Reorganization. All outstanding options and
         warrants have been excluded from diluted loss per share for loss
         periods presented as their effect would be anti-dilutive.

         The following table illustrates the computation of basic and diluted
         earnings (loss) per share under the provisions of SFAS 128:

<TABLE>
<CAPTION>
                                                      For the Three Months Ended
                                                              March 31,
                                                      --------------------------
                                                         1998           1999
                                                       --------       --------
                                                        (dollars in thousands,
                                                        except per share data)
<S>                                                    <C>            <C>
         Numerator:

         Numerator for basic and diluted earnings
          (loss) per share - net (loss) income         $ (1,088)      $  1,209
                                                       ========       ========
         Denominator:

         Denominator for basic earnings (loss) per
          share - weighted average number of common
          shares outstanding during the period           10,298         10,836

         Incremental common shares attributable to
          exercise of outstanding options                    --             89
                                                       --------       --------
         Denominator for diluted earnings (loss)
          per share                                      10,298         10,925
                                                       ========       ========

         Basic earnings (loss) per share               $  (0.11)      $   0.11
                                                       ========       ========

         Diluted earnings (loss) per share             $  (0.11)      $   0.11
                                                       ========       ========
</TABLE>





                                     - 6 -
<PAGE>   7

7.       NEW ACCOUNTING PRONOUNCEMENTS

         In June 1998, the FASB issued SFAS No. 133 "Accounting for Derivative
         Instruments and Hedging Activities." SFAS No. 133 is effective for
         transactions entered into after January 1, 2000. This statement
         requires that all derivative instruments be recorded on the balance
         sheet at fair value. Changes in the fair value of derivatives are
         recorded each period in current earnings or other comprehensive income,
         depending on whether a derivative is designated as part of a hedge
         transaction and the type of hedge transaction. The ineffective portion
         of all hedges will be recognized in earnings. The Company is in the
         process of determining the impact that the adoption of SFAS No. 133
         will have on its results of operations and financial position.

         In October 1997, the American Institute of Certified Public Accountants
         ("AICPA") released Statement of Position 97-2, "Software Revenue
         Recognition" ("SOP 97-2"). Among other things, SOP 97-2 eliminates the
         distinction between significant and insignificant vendor obligations
         promulgated by SOP 91-1 and requires each element of a software
         arrangement to meet certain criteria in order to recognize revenue
         allocated to that element. Additionally, SOP 97-2 requires that total
         fees under an arrangement be allocated to each element in the
         arrangement based upon vendor specific objective evidence, as defined.
         SOP 97-2 is effective for software transactions entered into by the
         Company in fiscal 1998 and subsequent periods. The adoption in 1998 did
         not have a significant effect on the Company's results of operations.

         On December 22, 1998, the AICPA issued Statement of Position 98-9
         "Software Revenue Recognition With Respect to Certain Transactions"
         ("SOP 98-9"). SOP 98-9 amends certain paragraphs of SOP 97-2 to require
         recognition of revenue using the "residual method" with respect to
         certain transactions. The "residual method" established by SOP 98-9 is
         effective for fiscal years beginning after March 15, 1999.

8.       DEFERRED FINANCING COSTS

         During 1998, the Company commenced efforts to raise additional capital.
         As of March 31, 1999, the Company has incurred costs of approximately
         $572,000 which were capitalized and are included in prepaids and other
         assets.

9.       COMPREHENSIVE (LOSS) INCOME

         In June 1997, the Financial Accounting Standards Board (FASB) issued
         SFAS No. 130, "Reporting Comprehensive Income," which establishes
         standards for reporting and disclosure of comprehensive income and its
         components (revenue, expenses, gains and losses) in a full set of
         general purpose financial statements. SFAS No. 130 is effective for
         fiscal years beginning after December 15, 1997 and requires
         reclassification of financial statements for earlier periods to be
         provided for comparative purposes. The Company has presented the
         information required by SFAS No. 130 as follows:

<TABLE>
<CAPTION>
                                     For the Three Months Ended
                                             March 31,
                                     --------------------------
                                        1998           1999
                                       -------        -------
<S>                                  <C>              <C>
         Net (loss) income             $(1,088)       $ 1,209
         Change in cumulative
          translation adjustments           50             10
                                       -------        -------
         Comprehensive (loss) income   $(1,038)       $ 1,219
                                       =======        =======
</TABLE>

         Accumulated other comprehensive (loss) income in the accompanying
         consolidated balance sheets consists of cumulative translation
         adjustments.

10.      RECLASSIFICATIONS

         Certain reclassifications have been made to the 1998 condensed
         consolidated financial statements to conform to the 1999 presentation.


                                     - 7 -
<PAGE>   8

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

LIQUIDITY AND CAPITAL Resources

At March 31, 1999, working capital improved from a negative working capital of
$8,698,000 at December 31, 1998 to a negative working capital of $5,807,000.
Excluding unearned revenue of $13,401,000, the Company's working capital at
March 31, 1999 would be $7,594,000 or a ratio of current assets to current
liabilities of 1.39 to 1.0. Excluding unearned revenue, working capital at
December 31, 1998 was $2,004,000, with a current ratio of 1.11 to 1.0. Excluding
unearned revenue, the increase of $5,590,000 was primarily attributable to an
increase in receivables of $5,182,000.

Cash was $2,772,000 at March 31, 1999, as compared to $2,029,000 at December 31,
1998. The Company continues to have a $5,000,000 secured revolving credit
facility. The computation of the availability of this line of credit is based on
a calculation using a rolling average of certain cash collections. At March 31,
1999, approximately $3,742,000 was available and drawn down under this facility.

Net cash used for investing activities in the three months ended March 31, 1999,
totaled $222,000. Capitalized software costs comprised $218,000.

Stockholders' deficiency decreased $1,726,000 at March 31, 1999, as compared to
December 31, 1998, due principally to the net income of $1,209,000 for the
period and the issuance of common shares. At March 31, 1999, there was a
stockholders' deficit of $640,000.

The Company believes it will continue to have sufficient cash available to fund
its operating and capital requirements for the next twelve months. 

RESULTS OF OPERATIONS

Three Months Ended March 31, 1998 Compared to Three Months Ended March 31, 1999

<TABLE>
<CAPTION>
                                   Three Months Ended    Percentage    Three Months Ended     Percentage
                                     March 31, 1998      of Revenue      March 31, 1999       of Revenue
                                     --------------      ----------      --------------       ----------
<S>                                <C>                   <C>           <C>                    <C>  
Revenues:
    Hospitality                         $  7,811            51.4%           $ 10,280             63.9%
    Process Manufacturing                  2,160            14.2%              2,268             14.1%
    Gaming                                   366             2.4%                359              2.2%
    Legacy                                 4,863            32.0%              3,177             19.8%
    Other                                      9             0.1%                 --               --
Total revenue                             15,209           100.0%             16,084            100.0%
Gross profit                               7,175            47.2%              9,068             56.4%
Selling, general &
  administrative expenses                  6,244            41.1%              5,836             36.2%
Research and development costs               965             6.3%              1,202              7.5%
Amortization of intangibles                  615             4.0%                610              3.8%
Other operating (income) expense             184             1.2%                (41)             0.2%
</TABLE>

The quarter-to-quarter increase in overall revenue of 5.8% was due primarily to
an increase in sales of hospitality enterprise solutions. Hospitality revenue
increased 31.6% from $7,811,000 in 1998 to $10,280,000 in 1999, largely due to
increased software sales.

Consistent with the Company's strategy to focus on providing software and
services to its vertical markets, the Company's legacy revenue (traditional
hardware contract service revenues and proprietary add-on sales) declined 34.7%
quarter over quarter, largely due to the expected decrease in volume.

Gross profit increased to 56.4% from 47.2% due to higher gross margins from an
increase in software sales. Revenue on lower margin functions such as hardware
and legacy declined.


                                     - 8 -
<PAGE>   9

Selling, general and administrative expenses ("SG&A") decreased 6.5% to
$5,836,000. The decrease is related to the implementation of several cost
reduction measures.

Research and development costs increased 24.6% over the comparable period in
1998. This is primarily as a result of new development efforts relating to
several new projects.

The 0.8% decrease in amortization of intangibles versus the comparable period of
1998 is related to a write down of intangibles which occurred in the fourth
quarter of 1998.

Other operating income for the three months ended March 31, 1999 was principally
from foreign exchange gains.

NEW ACCOUNTING STANDARDS

In June 1997, the Financial Accounting Standards Board ("FASB") issued Statement
of Financial Accounting Standard ("SFAS") Nos. 130 and 131, "Reporting
Comprehensive Income" ("SFAS 130") and "Disclosures about Segments of an
Enterprise and Related Information" ("SFAS 131"), respectively (collectively,
the "Statements"). The Statements are effective for fiscal years beginning after
December 15, 1997. SFAS 130 establishes standards for reporting of comprehensive
income and its components in annual financial statements. SFAS 131 establishes
standards for reporting financial and descriptive information about an
enterprise's operating segments in its annual financial statements and selected
segment information in interim financial reports. Reclassification or
restatement of comparative financial statements or financial information for
earlier periods is required upon adoption of SFAS 130 and SFAS 131,
respectively. Application of the statement requirements did not have a material
impact on the Company's consolidated financial position, results of operations
or loss per share as currently reported.

In February 1998, the FASB issued SFAS No. 132 "Employers' Disclosures about
Pensions and Other Post-retirement Benefits." This statement revises employers'
disclosures about pension and other post-retirement benefit plans. This
statement is effective for fiscal years beginning after December 15, 1997 and
restatement of disclosures for earlier periods is required. The Company adopted
SFAS No. 132 in 1998.

In June 1998, the FASB issued SFAS No. 133 "Accounting for Derivative
Instruments and Hedging Activities." SFAS No. 133 is effective for transactions
entered into after January 1, 2000. This statement requires that all derivative
instruments be recorded on the balance sheet at fair value. Changes in the fair
value of derivatives are recorded each period in current earnings or other
comprehensive income, depending on whether a derivative is designated as part of
a hedge transaction and the type of hedge transaction. The ineffective portion
of all hedges will be recognized in earnings. The Company is in the process of
determining the impact that the adoption of SFAS No. 133 will have on its
results of operations and financial position.

In October 1997, the American Institute of Certified Public Accountants
("AICPA") released Statement of Position 97-2, "Software Revenue Recognition"
("SOP 97-2"). Among other things, SOP 97-2 eliminates the distinction between
significant and insignificant vendor obligations promulgated by SOP 91-1 and
requires each element of a software arrangement to meet certain criteria in
order to recognize revenue allocated to that element. Additionally, SOP 97-2
requires that total fees under an arrangement be allocated to each element in
the arrangement based upon vendor specific objective evidence, as defined. SOP
97-2 is effective for software transactions entered into by the Company in
fiscal 1998 and subsequent periods. The adoption in 1998 did not have a
significant effect on the Company's results of operations.

On December 22, 1998, the AICPA issued Statement of Position 98-9 "Software
Revenue Recognition With Respect to Certain Transactions" ("SOP 98-9"). SOP 98-9
amends certain paragraphs of SOP 97-2 to require recognition of revenue using
the "residual method" with respect to certain transactions. The "residual
method" established by SOP 98-9 is effective for fiscal years beginning after
March 15, 1999.


                                     - 9 -
<PAGE>   10

YEAR 2000 COMPLIANCE RISKS

The Year 2000 compliance issue arises from the fact that a significant
percentage of the software utilized by United States businesses relies on
two-digit date codes to perform computations and decision-making functions.
Commencing on January 1, 2000, these computer programs may fail from an
inability to interpret date codes properly, misinterpreting "00" as the year
1900 rather than 2000. The Company has completed an evaluation of both its
information technology systems and its non-technology systems, such as equipment
containing microprocessors. The Company believes that all information technology
and non-technology systems in its corporate home office in Irvine, California
and in its branch or subsidiary offices in the United States and internationally
have been, or by June 30, 1999 will have been, modified to address Year 2000
issues. The Company estimates that the costs associated with implementing its
Year 2000 compliance plan for its corporate offices to be approximately $50,000.

The Company has designed and tested the most current versions of its products to
be Year 2000 ready. The Company has established a Year 2000 "task force" which
prepared and released its Year 2000 products readiness report on the Company's
"Web Pages" (www.maisystems.com and www.hotelinfosys.com) and plans to make
available to clients a copy of this report on a per request basis. The Company
launched a direct mail/fax campaign in February 1999 to all of its current
maintenance agreement clients as well as to all identifiable clients that may be
utilizing the Company's products, informing clients that the "Year 2000
Readiness Program" was available to be viewed at the indicated websites. The
mailing also provided clients the opportunity to request information regarding
the "Year 2000 Readiness Program" if they so desired. This mailing was executed
using the most current client database available. This notification went to
approximately 18,000 domestic customers as well as being faxed to approximately
4,000 international customers from the Company's international offices.

The report breaks down the Company's products into four categories: "product is
ready," "product is scheduled to be tested," "product is not ready (but has some
Year 2000 functionality)," and "product will not be tested (and is not ready)."
At the present time, of the eighty-nine products listed in the Company's Year
2000 readiness report, twenty-four remain to be tested, and thirty-six fall in
the final category of products that will not be tested or ready. Of those
products in the latter category, many of these are older products that have been
replaced by newer versions of software. The Company is continuing to work on
making some of its older software Year 2000 ready. The software still under
modification is not required to be upgraded before the end of 1999. Nonetheless,
the Company believes that all modifications will be complete and ready for
distribution to its customers by June 30, 1999. Although the Company has been
encouraging its customers to upgrade to current product versions, no assurance
can be given that all of them will do so in a timely manner, if at all.

The costs incurred by the Company to date to implement its Year 2000 readiness
plan for its products have not been material to the Company's financial
condition or operations.

The Company also relies on certain software that it licenses from third parties,
including software that is integrated with internally developed software and is
used in the Company's products to perform key functions. The Company has
undertaken joint compliance review of such software in certain cases where the
product is believed to be material to the Company's financial performance, such
as its "Lodging Touch" product that is licensed from Enterprise Hospitality
Solutions. The Company believes that in such selective cases the licensed
software and any related integrated software product is Year 2000 compliant.
There can be no assurance, however, that all third party software presently
utilized by the Company will be free of errors and defects or be Year 2000
compliant.

The Company's present "reasonably likely worst case scenario" for Year 2000
problems involves potential product liability claims by substantial customers
involving collateral (business interruption) damages. Although the Company has
not experienced any product liability claims to date regarding Year 2000
compliance, there can be no assurance that errors or defects, whether associated
with Year 2000 functions or otherwise, will not result in product liability
claims against the Company in the future. The Company's license agreements with
customers typically contain provisions designed to limit the Company's exposure
to potential product liability claims; however, it is possible that such
limitation of liability provisions may not be effective under the laws of
certain jurisdictions. Defective products or releases could result in loss of
revenues, increased service and warranty costs and product liability claims, and
could adversely affect the Company's market penetration and reputation, any of
which could have a material adverse effect on the Company's business, financial
condition and results of operations.


                                     - 10 -
<PAGE>   11

Since the Company spent a significant amount of time developing its Year 2000
readiness plan and evaluating its products for readiness, it does not believe
that an elaborate Year 2000 contingency plan is necessary. However, it is
reasonable to assume that some problems may be discovered in products the
Company currently believes to be Year 2000 ready. In this case, the Company has
the necessary resources available to address these expected problems and provide
the appropriate customers with updated software.

The Company is in the process of compiling information concerning the Year 2000
compliance of its key suppliers through the process of issuing questionnaires
and monitoring responses. In the event that any of the Company's key suppliers
do not successfully and timely achieve Year 2000 compliance, the Company's
business or operations could be adversely affected. The Company's Year 2000
compliance plan includes encouraging and/or requiring Year 2000 compliance by
all key suppliers.

Despite the Company's efforts to become Year 2000 compliant, there is no
assurance that the Year 2000 issue will not pose significant problems. There may
be delays in the Company's remediation efforts, a failure to fully identify all
Year 2000 problems in the systems, equipment or processes of the Company or its
vendors or customers, or unanticipated remediation expenses, all of which could
have material adverse consequences on the Company's financial position and
results of operations.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Market Risk Disclosures

The following discussion about the Company's market risk disclosures contains
forward-looking statements. Forward-looking statements are subject to risks and
uncertainties. Actual results could differ materially from those discussed in
the forward-looking statements. The Company is exposed to market risk related
to changes in interest rates and foreign currency exchange rates. The Company
does not have derivative financial instruments for hedging, speculative, or
trading purposes.

Interest Rate Sensitivity

Of the Company's $8.99 million principal amount of indebtedness at March 31,
1999, $3.74 million bears interest at a rate that fluctuates based on changes
in prime rate. A 1% change in the underlying prime rate would result in an
approximate $38,000 change in the annual amount of interest payable on such
debt. The remaining amount of $5.25 million bears interest at a fixed rate of
11%.

Foreign Currency Risk

The Company believes that its exposure on currency exchange fluctuation risk is
insignificant because the Company's transactions with international vendors are
generally denominated in US dollars, which is considered to be the functional
currency of the Company and its subsidiary. The currency exchange impact on
intercompany transactions was immaterial for the quarter ended March 31, 1999.

                                     - 11 -
<PAGE>   12

PART II - OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

         None.

ITEM 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS

         (a)      None.

         (b)      None.

         (c)      On February 4, 1999, the Company issued 201,106 shares of the
                  Company's Common Stock to Richard S. Ressler at a price of
                  $2.48625 per share (or $500,000 in the aggregate). This
                  issuance was made pursuant to an offer made by the Company to
                  Mr. Ressler on January 28, 1999 in order to induce a cash
                  infusion into the Company. The Company temporarily offered
                  shares of its Common Stock to Mr. Ressler for a one week
                  period only and the sales price was set at a level equal to
                  90% of the average closing market price for the Common Stock
                  over the ten most recent trading days immediately prior to
                  such temporary offer.

                  The foregoing issuance was made in a transaction exempt under
                  Section 4 (2) under the Securities Act of 1933, as a
                  transaction not involving any public offering. The shares
                  issued were legended and appropriate investment
                  representations were obtained from the purchaser.

         (d)      None.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

         None.

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

         (a)      None.

         (b)      None.

         (c)      None.

         (d)      None.

ITEM 5.  OTHER INFORMATION

         None.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

         (a)      Exhibits.

                  27 -- Financial Data Schedule.

         (b)      Reports on Form 8-K.

                  None.


                                     - 12 -
<PAGE>   13

                                   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.

                                           MAI SYSTEMS CORPORATION
                                           (Registrant)




Date: May 11, 1999                         /s/ Lewis H. Stanton
                                           -------------------------------------
                                           Lewis H. Stanton
                                           Executive Vice President and
                                           Chief Operating and Financial Officer
                                           (Chief Accounting Officer)


                                     - 13 -


<PAGE>   14

                                  EXHIBIT INDEX

<TABLE>
<CAPTION>
EXHIBIT
NUMBER              DESCRIPTION
------              -----------
<C>                 <S>
 27.1               Financial Data Schedule
</TABLE>