MARCAM CORP, 424B4, 1997-07-30

MARCAM CORP
424B4, 1997-07-30
PREPACKAGED SOFTWARE

Previous: BIOSAFE INTERNATIONAL INC, SC 13D/A, 1997-07-30

Next: INSURED MUNICIPALS INCOME TRUST 67TH INSURED MULTI SERIES, 497J, 1997-07-30

Filed Pursuant to Rule 424(b)(4)
Registration No. 333-26203

PROSPECTUS
July 30, 1997

[MAPICS LOGO] 6,000,000 Shares

MAPICS, Inc.

Common Stock

All of the shares of Common Stock offered hereby are being sold by MAPICS,
Inc. ("MAPICS" or the "Company," formerly known as Marcam Corporation). The
Company has distributed to its stockholders of record on July 23, 1997 (the
"Distribution") all of the outstanding capital stock of Marcam Solutions, Inc.,
a new wholly owned subsidiary of the Company ("Marcam Solutions"). Purchasers of
Common Stock in the Offering will not participate in the Distribution. See "The
Distribution." Accordingly, historical trading prices of the Common Stock of
Marcam Corporation will not be indicative of future trading prices of the
Company's Common Stock. The initial price to the public of the Common Stock
offered hereby has been determined by negotiations between the Company and the
Underwriters. See "Underwriting" for information relating to the factors
considered in determining the initial price to the public. The Company's Common
Stock is traded on the Nasdaq National Market under the symbol "MAPX."

See "Risk Factors" on page 7 for information that should be considered by
prospective investors.

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE.

Price Underwriting Proceeds
to Discounts and to the
the Public Commissions(1) Company(2)
-------------- ---------------- -----------
<S> <C> <C> <C>
Per Share ...... $9.00 $0.63 $8.37
Total (3) ...... $54,000,000 $3,780,000 $50,220,000
</TABLE>

(1) The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933, as
amended. See "Underwriting" for indemnification arrangements with the
Underwriters.
(2) Before deducting expenses payable by the Company estimated at $1,750,000.
(3) The Company has granted to the Underwriters a 30-day option to purchase up
to an aggregate of 900,000 additional shares at the Price to the Public,
less Underwriting Discounts and Commissions, solely to cover
over-allotments, if any. If the option is exercised in full, the total
Price to the Public, Underwriting Discounts and Commissions and Proceeds to
the Company will be $62,100,000, $4,347,000 and $57,753,000,
respectively. See "Underwriting."

The shares of Common Stock are offered by the several Underwriters when, as
and if delivered to and accepted by the Underwriters and subject to various
prior conditions, including their right to reject orders in whole or in part.
It is expected that delivery of the share certificates will be made in New
York, New York on or about August 4, 1997.

Donaldson, Lufkin & Jenrette
Securities Corporation
Lazard Freres & Co. LLC
Dain Bosworth
Incorporated

<PAGE>

[PICTURES]

Description of Inside Front Cover Page Graphics:

Multicolor computer generated graphic depicting a silhouette of two
people shaking hands, encircled by computer icons which depict and name seven
areas of the Company's software applications, as follows: Financial Management;
Engineering; Production Planning; Plant Operations; Maintenance Management;
Marketing; and Cross-Applications, all superimposed upon a globe-like sphere
against a multi-colored background.

[/PICTURE]

[CAPTION]

MAPICS offers products -- over 40 integrated applications -- to meet a variety
of needs for the discrete and batch-process manufacturing industries. MAPICS
provides its customers with a strategic resource to gain a competitive edge in
their constantly changing marketplace.
[/CAPTION]

CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN TRANSACTIONS
THAT STABILIZE, MAINTAIN, OR OTHERWISE AFFECT THE PRICE OF THE COMMON STOCK.
SPECIFICALLY, THE UNDERWRITERS MAY OVER-ALLOT IN CONNECTION WITH THE OFFERING
AND MAY BID FOR AND PURCHASE SHARES OF THE COMMON STOCK IN THE OPEN MARKET. FOR
A DESCRIPTION OF THESE ACTIVITIES, SEE "UNDERWRITING."

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

IN CONNECTION WITH THIS OFFERING, CERTAIN UNDERWRITERS AND SELLING GROUP
MEMBERS (IF ANY) OR THEIR RESPECTIVE AFFILIATES MAY ENGAGE IN PASSIVE MARKET
MAKING TRANSACTIONS IN THE COMMON STOCK ON THE NASDAQ STOCK MARKET IN
ACCORDANCE WITH RULE 103 OF REGULATION M. SEE "UNDERWRITING."

MAPICS[RegTM] is a registered trademark of the Company. Marcam[RegTM] is a
registered trademark of Marcam Solutions. This Prospectus also includes product
and company names, trademarks and trade names of companies other than the
Company.

2
<PAGE>

PROSPECTUS SUMMARY

The following summary is qualified in its entirety by the detailed
information and combined financial statements, including the notes thereto,
appearing elsewhere in this Prospectus. Except as otherwise noted, all
information in this Prospectus (i) assumes no exercise of the Underwriters'
over-allotment option; and (ii) gives effect to the Distribution. Although
Marcam Solutions Common Stock will be distributed to Marcam Corporation's
stockholders, the Distribution will be recorded as a disposal of the business
conducted by MAPICS, Inc., due to the relative significance of the business
conducted by Marcam Solutions. Except as otherwise noted, the combined
financial statements and notes thereto and all other financial data herein
reflect only the business related to the MAPICS products, as derived from the
historical assets, liabilities and operating results of Marcam Corporation. See
"The Distribution," "Relationship Between MAPICS and Marcam Solutions,"
"Description of Capital Stock," "Underwriting" and Notes 1 and 15 of Notes to
Combined Financial Statements.

THE COMPANY

MAPICS is a leading provider of enterprise resource planning ("ERP")
software applications for mid-size discrete and batch-process manufacturing
enterprises worldwide. The Company's products provide an integrated and
function-rich ERP solution with the breadth and depth of applications to manage
an entire manufacturing enterprise. The MAPICS XA product line currently
consists of 44 integrated application modules in the areas of Engineering and
Cost Management, Market and Demand Management, Plant Operations and Logistics
Management, Production Resource Planning, Financial Management and Measurements
and Cross Applications Solutions. The Company continually enhances its product
offerings to meet the specific needs of mid-size manufacturers and offers such
manufacturers the opportunity to gradually migrate to new technologies, one
user at a time if desired, while protecting their existing investments in both
hardware and software. In addition to its internal development programs, the
Company utilizes independent software developers, known as Solution Partners,
to assist in the development of new applications. Solution Partners permit the
Company to introduce new applications quickly and on a variable cost basis.

Approximately 5,700 customer sites presently use MAPICS applications,
which the Company believes represents one of the largest installed user bases
in the ERP industry. In Advanced Manufacturing Research's ("AMR") survey of ERP
customer satisfaction, MAPICS products received the highest overall total score
(nearly one-third higher than the next competitor) based on 15 different
factors, including functionality, value, implementation results, quality of
support, service and maintenance, and knowledge of sales force. The Company's
customer base consists primarily of mid-size ($20 million to $500 million in
annual revenues) manufacturers and divisions, sites and subsidiaries of large
companies, including Bristol-Myers Squibb Company, Colgate-Palmolive Company,
Eaton Corporation, General Electric Company, Honda Motor Co., Ltd.,
International Game Technology, Peg Perego Pines SPA, Shiseido Cosmetics
(America) Ltd. and Sub-Zero Freezer Co., Inc. The primary channel for selling
and supporting MAPICS products is a network of more than 80 affiliates which
sells, implements, services and supports MAPICS products throughout the world.
In addition to providing customers high quality local implementation,
consulting and support services in a cost-effective manner, the affiliate
distribution channel provides the Company an attractive variable cost structure
for sales and marketing.

According to industry sources, the total worldwide market for ERP systems
on all hardware systems was approximately $5.5 billion in 1996 and will grow at
least 20% this year. The MAPICS XA product line runs on International Business
Machines Corporation's ("IBM") AS/400 system, which the Company believes is the
leading platform in the mid-size manufacturing market.

The Company's primary objective is to continue to be a leading provider of
integrated ERP solutions to mid-size manufacturers worldwide. The key elements
to implement this strategy are:

Leverage Large Installed Customer Base. The Company believes the
approximately 5,700 customer sites using MAPICS applications represent one of
the largest installed user bases in the ERP industry. Opportunities for
recurring revenue from existing customers include continued licensing of
existing modules, licensing of additional modules, implementation of MAPICS
products at additional sites, upgrades to larger processors and migrations to
new technologies.

3
<PAGE>

Utilize Well-Established Affiliate Distribution Channel. MAPICS products
are distributed in over 50 countries through a network of more than 80
affiliates. The use of local affiliates provides the Company with strong market
access and penetration, while providing for local support. With their extensive
experience installing MAPICS products, these affiliates typically offer
customers high quality and cost-effective local implementation, consulting and
support services and, in some cases, offer complementary products. Affiliates
typically have extensive knowledge of the mid-size manufacturing industry in
their geographic region and are able to establish and maintain cooperative
relationships with MAPICS customers. The affiliate distribution channel
provides the Company with an attractive variable cost structure for sales and
marketing.

Accelerate Growth in International Markets. The Company intends to
continue to expand its market presence throughout the world, with a focus on
Europe where there is a large installed base of IBM AS/400 systems. During
1996, the Company introduced its International Financial Management suite of
modules, which are designed to meet the requirements of international
enterprises with customers and production facilities in multiple countries. To
address specific needs in local markets, MAPICS modules are translated and
localized, supporting the local language, currency, taxation and accounting
requirements. Currently, the most commonly installed MAPICS XA application
modules are available in English, Chinese, French, German, Japanese, Portuguese
and Spanish.

Broaden Customer Base with New Functionality. The Company intends to
continue to broaden its customer base by offering new functionality required by
both new and existing customers. The Company uses the feedback it receives from
its customers, affiliates and Solution Partners to develop the functionality
needed by certain segments of the mid-size manufacturing industries. For
example, the Company recently introduced Intersite Logistics for customers with
multiple, interrelated production sites; Contract Accounting for manufacturers
with projects which extend over long time periods and for government
contractors; and Knowledge-Based Configurator for manufacturers in
make-to-order production industries.

The Company was incorporated in Massachusetts in 1980. The Company's
principal executive offices are located at 5775-D Glenridge Drive, Atlanta,
Georgia 30328, and its telephone number is (404) 705-3000.

RECENT DEVELOPMENTS

For the quarter ended June 30, 1997, MAPICS had revenues of $22.0 million
and net income of $3.0 million. MAPICS continued to show positive growth in the
1997 third quarter with an increase in license revenue of 24% and an increase
in total revenue of 21% compared to the 1996 third quarter.

On July 25, 1997, Marcam Corporation borrowed $64 million (the "Debt
Financing"). The net proceeds from the Debt Financing were used to make the $39
million cash transfer by Marcam Corporation to Marcam Solutions in connection
with the Distribution and to repay Marcam Corporation's $25 million of 9.82%
Subordinated Notes due 2001 (the "Subordinated Notes"). The indebtedness
incurred in the Debt Financing currently bears interest at the rate of 9%, is
payable on August 4, 1997 and is secured by liens on substantially all of the
Company's assets. This indebtedness will be repaid in part with the net proceeds
from the Offering. See "The Distribution," "Use of Proceeds" and "Management's
Discussion and Analysis of Financial Condition and Results of
Operations--Liquidity and Capital Resources."

4
<PAGE>

THE DISTRIBUTION

Marcam Corporation has spun off in a tax-free distribution the portion of
its business relating to its PRISM, Protean and Avantis product lines. The
separation into two independent, publicly traded companies is designed to enable
each to better focus on its core markets, to better serve existing customers and
to finance its business.

In connection with the spin-off, Marcam Corporation has transferred to a
newly formed corporation, Marcam Solutions, substantially all of the business,
assets and liabilities relating to its PRISM, Protean and Avantis product lines
and an aggregate of $39.0 million in cash (the "Asset Transfers"). The $39.0
million cash transfer by Marcam Corporation to Marcam Solutions was financed
with a portion of the net proceeds from the Debt Financing. See
"Summary--Recent Developments" and "Management's Discussion and Analysis of
Financial Condition and Results of Operations--Liquidity and Capital
Resources."

All of the outstanding shares of common stock of Marcam Solutions were
distributed (the "Distribution") by means of a distribution on July 29, 1997 to
stockholders of Marcam Corporation of record on July 23, 1997. Purchasers of
Common Stock in the Offering will not participate in the Distribution. See "The
Distribution."

THE OFFERING

Common Stock offered by the Company ...... 6,000,000 shares
Common Stock to be outstanding after
the Offering ........................... 17,535,010 shares(1)
Use of Proceeds ........................... Repayment of debt and general corporate purposes,
including working capital
Nasdaq National Market symbol ........... "MAPX"
</TABLE>

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

(1) Does not include as of May 31, 1997 (i) 3,250,000 shares of Common Stock
issuable upon the conversion of the Series D and E Convertible Preferred
Stock outstanding, (ii) 1,383,333 shares of Common Stock (subject to
adjustment) issuable upon the exercise of warrants outstanding with a
weighted average exercise price of $13.58 per share and (iii) 2,626,132
shares of Common Stock issuable upon the exercise of stock options
outstanding as of May 31, 1997 with a weighted average exercise price of
$14.675 per share. In connection with the Distribution, the exercise
prices of the warrants and the options will be reduced, and the number of
shares of Common Stock issuable upon exercise of certain of the warrants
will be increased, on a basis intended to preserve the spread value of the
warrants and options. See "Capitalization," "The Distribution" and
"Description of Capital Stock."

5
<PAGE>

SUMMARY COMBINED FINANCIAL DATA(A)

Six Months Ended
Fiscal Years Ended September 30, March 31,
--------------------------------- --------------------
1994 1995 1996 1996 1997
(In thousands, except per share data)
<S> <C> <C> <C> <C> <C>
Statement of Operations Data:
Revenues:
License ........................ $33,410 $42,745 $45,341 $20,501 $25,328
Services ........................ 19,373 26,553 32,261 15,343 18,837
-------- -------- -------- -------- --------
Total revenues .................. 52,783 69,298 77,602 35,844 44,165
-------- -------- -------- -------- --------
Operating expenses:
Cost of license revenues ......... 3,280 5,689 6,913 3,026 4,129
Cost of services revenues ...... 5,428 7,567 9,499 4,573 5,301
Selling and marketing ............ 17,765 24,780 27,851 13,028 14,834
Product development ............ 6,692 7,432 6,398 3,122 4,969
General and administrative ...... 4,810 5,384 5,965 2,212 4,360
-------- -------- -------- -------- --------
Total operating expenses ...... 37,975 50,852 56,626 25,961 33,593
-------- -------- -------- -------- --------
Operating income .................. 14,808 18,446 20,976 9,883 10,572
Income tax expense ............... 4,641 7,112 8,076 3,805 4,071
-------- -------- -------- -------- --------
Net income ........................ $10,167 $11,334 $12,900 $ 6,078 $ 6,501
======== ======== ======== ======== ========
Pro forma net income per
common share (B) ............... $ 0.70 $ 0.34
======== ========
Pro forma weighted average
number of common shares
outstanding (B) .................. 18,518 19,324
======== ========
</TABLE>

<TABLE>
<CAPTION>
As of March 31, 1997
-----------------------------------------------------
Pro Forma
Actual Pro Forma(C) As Adjusted (C)(D)
(In thousands)
<S> <C> <C> <C>

Balance Sheet Data:
Cash and cash equivalents ............ $ 852 $ 852 $ 852
Working capital (deficit) (E) ......... (13,999) (77,999) (29,529)
Total assets ........................ 46,646 46,646 46,646
Total debt ........................... -- 64,000 15,530
Divisional equity .................. 9,228 -- --
Stockholders' equity (deficit) ...... -- (54,772) (6,302)
</TABLE>

- ------------
(A) See Combined Financial Statements and related Notes thereto appearing
elsewhere in this Prospectus.
(B) See Note 2 of Notes to Combined Financial Statements for information
concerning the computation of per share earnings.
(C) Adjusted to give effect to the Distribution and the Debt Financing, the
proceeds of which were used to repay Marcam Corporation's $25.0 million
9.82% Subordinated Notes due 2001 (assumed by the Company for accounting
purposes) and to make the $39.0 million cash transfer to Marcam Solutions.
(D) Adjusted to give effect to the sale of shares of Common Stock offered by
the Company hereby and the application of the estimated net proceeds
therefrom. See "Use of Proceeds," "Capitalization" and "Description of
Capital Stock."
(E) Includes $21.2 million of deferred revenue.

6
<PAGE>

RISK FACTORS

This Prospectus contains forward-looking statements. Actual results could
differ materially from those projected in the forward-looking statements as a
result of the risk factors set forth below and elsewhere in this Prospectus. In
addition to the other information contained in this Prospectus, the following
factors should be carefully considered by prospective investors when evaluating
an investment in the Common Stock offered hereby. The following factors relate
to the entire MAPICS product line.

Variability in Quarterly Operating Results; Seasonality. The Company has
experienced fluctuations in its quarterly operating results and anticipates
that such fluctuations will continue and may intensify. The Company's quarterly
operating results are affected by a number of factors that could materially and
adversely affect revenues and profitability, including the size and timing of
license transactions; the demand for the Company's products; the proportion of
revenues attributable to license fees versus services fees; the proportion of
Solution Partner-developed products versus internally-developed products
licensed; changes in the level of operating expenses; the potential for delay
or deferral of customer purchases of the Company's software; the timing of the
introduction or market acceptance of new or enhanced products offered by the
Company or its competitors; the ability of the Company's affiliate distribution
channel to service additional sales; the competitive conditions in the
industry; and the general economic and political conditions and other factors
affecting capital expenditures by customers. The purchase of the Company's
products and services may involve a significant commitment of capital and other
resources by its customers with the attendant delays frequently associated with
large capital expenditures and authorization procedures within an organization.
Accordingly, the sales cycles for the Company's products and services are
subject to a number of significant risks over which the Company has little or
no control, including customers' budgetary constraints and internal
authorization procedures. License revenues in any quarter are substantially
dependent on orders booked and shipped in that quarter.

The Company's quarterly operating results are subject to certain seasonal
fluctuations. The Company believes that its first quarter (ending December 31)
revenues generally are positively affected by year-end capital expenditures by
certain customers and by year-end incentives provided by International Business
Machines Corporation ("IBM") to resellers of its hardware, which include many
of the Company's distribution affiliates. In the Company's fourth quarter
(ending September 30), revenues are positively affected by the incentives
provided pursuant to the Company's sales compensation plans. These factors have
historically resulted in increased license revenues during such quarters. In
addition, the Company's revenues occur predominantly in the third month of each
quarter and tend to be concentrated in the latter half of that third month.
Accordingly, the Company's quarterly operating results are difficult to
predict, and delays in product delivery or in closings of sales near the end of
a quarter could cause quarterly revenues and, to a greater degree, net income
to fall substantially short of anticipated levels. Net income is affected
because the Company establishes its spending levels on the basis of its
expected future operating margins. These seasonal factors are likely to
continue to affect quarter-to-quarter comparisons.

Due to the foregoing factors, it is possible that the Company's operating
results could fail to meet the expectations of securities analysts or
investors. In such event, or in the event that adverse conditions in the
manufacturing or ERP marketplace prevail or are perceived to prevail, the price
of the Company's Common Stock would likely be materially adversely affected.
See "Management's Discussion and Analysis of Financial Condition and Results of
Operations--Quarterly Financial Results."

Reliance on Third Party Distribution Channel. The Company markets, sells,
and supports its products primarily through a network of more than 80
distribution affiliates and as a result maintains a limited direct sales force.
The Company relies on its affiliates for sales, product implementation,
customization and customer support services. There can be no assurance that the
affiliates will continue to provide the level and quality of service required
to meet the needs of the Company's customers or that the Company will be able
to maintain effective long-term relationships with its affiliates. If the
Company is unable to maintain effective, long-term relationships with the
affiliates, or if the affiliates fail to meet the needs of the Company's
customers, the Company's business would be adversely affected. From time to
time certain of the Company's competitors have established, and may continue to
seek to establish a comparable distribution channel, in part by attempting to
attract the Company's own affiliates. The Company's agreements with its
affiliates are generally terminable by either party and do not impose specific
obligations on the part of the affiliates. Further, there can be no assurance
that the affiliates will not otherwise reduce or discontinue their
relationships with or support of the Company and its products. See
"Business--Marketing and Sales."

7
<PAGE>

Competition. The market for business software within the mid-size
manufacturing industry is highly competitive, changes rapidly and is to a
significant degree affected by new product introductions and other market
activities of industry participants. The Company's products and related
services are primarily targeted at the market for business applications
software for use with the IBM AS/400. The Company's current and prospective
competitors offer a variety of products which address this and similar markets.
The Company's primary competition comes from a large number of independent
software vendors and other sources, including Baan N.V., Computer Associates,
Inc., Intentia AB, JBA Holdings Plc, J.D. Edwards & Company, Inc., Oracle
Corporation, SAP AG, and System Software Associates, Inc. Of the Company's
primary competitors, the products of Intentia are currently designed solely for
use with the IBM AS/400, and the products of JBA Holdings Plc, J.D. Edwards and
System Software Associates are currently designed for use primarily with the
IBM AS/400. The Company also experiences some competition from vendors of
specialized applications.

Certain of the Company's competitors have significantly greater financial,
marketing, service, support and technical resources, and greater name
recognition than the Company. In order to be successful in the future, the
Company must continue to respond promptly and effectively to the challenges of
technological change and its competitors' innovations. The Company's
competitors may be able to respond more quickly to new or emerging technologies
or changes in customer requirements or devote greater resources to the
development, promotion and sale of their products than the Company. The Company
also expects to face additional competition as other established and emerging
companies enter the market for business software for use with the AS/400 and as
new products and technologies are introduced. In addition, current and
potential competitors may make acquisitions or establish alliances among
themselves or with third parties, thereby increasing the ability of their
products to address the needs of the Company's prospective customers.
Accordingly, it is possible that new competitors or alliances among current and
new competitors may emerge and rapidly gain significant market share, resulting
in price or fee rate reductions, fewer customer orders and reduced gross
margin, any one of which could have a material adverse effect on the Company's
business, financial condition and results of operations. There can be no
assurance that the Company will be able to compete successfully with existing
or new competitors or that competition will not have a material adverse effect
on the Company's business, financial condition and results of operations. In
addition, because the Company relies on a network of distribution affiliates
for implementation and other support of its products, there can be no assurance
that these affiliates will maintain sufficiently high quality standards so that
the Company's reputation and competitive position will not be adversely
affected. See "Business-Marketing and Sales" and "--Competition."

Dependence on Key Personnel; Ability to Attract and Retain Skilled
Personnel. The Company's future performance depends to a significant extent
upon the continued service of a number of senior management and key technical
personnel. The Company does not maintain key-person life insurance on any of
its key employees. None of the Company's employees is bound by an employment
agreement. The loss of the services of one or more key employees could have a
material adverse effect on the Company. The Company's future financial results
also will depend in large part upon its ability to attract on a timely basis
and retain highly skilled technical, managerial and marketing personnel and the
ability of its officers and key employees to manage growth successfully and to
continue successful development of new products and enhancements to existing
products. Competition for such personnel is intense and is likely to intensify
further as companies compete to hire personnel. The Company competes in the
market for such personnel against numerous companies, including larger, more
established companies with significantly greater financial resources than the
Company. There can be no assurance that the Company will be successful in
attracting and retaining the personnel it requires to develop successfully new
and enhanced products. See "Business--Employees" and "Management."

Absence of History as a Stand-Alone Public Company; Limited Relevance of
Certain Historical Financial Information. The Company has never operated as a
stand-alone company. Except for Richard C. Cook, the Company's senior executive
officers have had limited or no prior management experience as senior
executives in a public company. After the Distribution, the Company will
operate as a stand-alone entity and, while the Company will continue to receive
certain services from Marcam Solutions, there can be no assurance that the
Company's operating results will not be adversely affected as a result of the
reduction of general service assistance from Marcam Solutions. In anticipation
of being established as a stand-alone entity, the Company has reviewed its
business and operations and is implementing certain organizational changes.
However, there can be no assurance that these changes or that the separation
from Marcam Solutions will not have an adverse impact on the Company's
business, financial condition and results of operations.

8
<PAGE>

The financial information included herein may not necessarily reflect the
results of operations, financial position and cash flows of the Company in the
future or what the results of operations, financial position and cash flows
would have been had the Company been a separate, stand-alone entity during the
periods presented, because certain allocations were made in preparing such
financial data. This is particularly true with regard to allocations of
corporate overhead. The financial information included herein does not reflect
the changes that may occur in the operations of the Company as a result of the
Distribution and the Offering, such as the increased administrative costs,
including data services, employee benefits, legal, insurance, accounting and
corporate overhead, that MAPICS will incur as a result of being an independent,
publicly traded company. In addition, the combined financial statements of the
Company include certain assets, liabilities, revenues and expenses which were
not historically recorded at the entity level of, but are associated with, the
Company. See "The Distribution" and "Management's Discussion and Analysis of
Financial Condition and Results of Operations--Overview."

New Products and Technological Change. The market for the Company's ERP
software products is characterized by rapid technological advances, evolving
industry standards in computer hardware and software technology, changes in
customer requirements, and frequent new product introductions and enhancements.
The Company's future success will depend upon its ability to continue to
enhance its MAPICS products and to develop and introduce new products that keep
pace with technological developments, satisfy increasingly sophisticated
customer requirements and achieve market acceptance. In particular, the Company
must continue to anticipate and respond adequately to advances in standard
business applications software and client/server solutions, as well as
object-oriented technology. There can be no assurance that the Company will be
successful in developing and marketing, on a timely and cost-effective basis,
functioning product enhancements or new products that respond to technological
advances by its competitors or that its new products will achieve market
acceptance. See "Business--Product Development."

As a result of the complexities inherent in the functionality and
performance demanded by ERP software customers, major new products and product
enhancements can require long development and testing periods. In addition, ERP
software programs as complex as those offered by the Company may contain errors
which are discovered only after the products and new releases have been
installed and used by customers despite testing by the Company. There can be no
assurance that undetected errors will not impair the market acceptance of these
products or adversely affect the Company's operating results. Problems
encountered by customers installing and implementing the Company's new product
releases or with product performance, including product functionality, product
response time and program errors, could also materially adversely affect the
Company's operating results.

Dependence on External Development Resources. To date, approximately 19 of
the Company's application modules were developed in collaboration with third
parties (Solution Partners) and the Company expects to continue to rely on
Solution Partners for the development of additional application modules.
Generally, Solution Partners continue to own the rights to, and maintain, the
technology underlying the modules and license, on an exclusive basis, the
technology to the Company. Under the terms of such agreements, the Company is
obligated to pay a royalty to a Solution Partner for sales of the Solution
Partner-developed application modules. In the event the Company fails to pay
the required royalty when due, such agreement may be terminated. The
termination of such an agreement with a Solution Partner could adversely affect
the Company's business, financial condition and results of operations. There
can be no assurance that Solution Partners will be available to develop
application modules for the Company in the future or will complete application
modules for the Company on a timely basis, within acceptable guidelines, or at
all. The Company's success depends in part on its continued ability to license
application modules from Solution Partners and there can be no assurance that
the Company will be able to obtain such licenses on terms acceptable to the
Company or at all. Although the Company is entitled to obtain a non-exclusive
license to the source code for an application module in the event the Solution
Partner fails to maintain or update the application module, goes out of
business or otherwise breaches the terms of the license agreement, the Company
may not be able to maintain or upgrade the application module adequately or on
a timely basis. The failure of the Company to adequately or on a timely basis,
maintain or upgrade the application module could adversely affect the Company's
business, financial condition and results of operations. See "Business--Product
Development."

Dependence on IBM's AS/400. Substantially all of the Company's revenues
have been derived from products designed to operate primarily on IBM's AS/400
series of computers. Therefore, the Company's future revenues from initial
license fees and periodic license fees will be primarily derived from and
dependent upon the continued widespread use of the AS/400 and the continued
support of the AS/400 by IBM. While the Company believes that

9
<PAGE>

customers will continue to use, and IBM will continue to support, the AS/400,
there can be no assurance of such continued use or support and the loss of
either would have a material adverse effect on the Company's operating results.
The Company will be required and intends to continue to devote significant
resources to supporting its installed base of AS/400 customers. Although the
Company believes it has an advantage in assisting its installed AS/400 base in
converting to independent platforms, there is no assurance that these customers
will continue to use MAPICS products if they implement such independent
platforms. If there should be a rapid shift away from the current widespread
use of the AS/400 operating system, the Company would be required to expend
substantial capital resources to develop new software and would be likely to
experience delays or losses in customer orders and, as a result, its business
would be materially adversely affected. In addition, in order to retain its
AS/400 customers, the Company may be required to adapt its MAPICS products to
any changes made in the AS/400 operating system in the future. The Company's
inability to adapt to future changes in the AS/400 operating system, or delays
in doing so, could have a material adverse effect on the Company's business,
financial condition and results of operations. See "Business--Industry
Background."

Management of Potential Growth. The Company's business has grown rapidly
in the last three years, with total revenues increasing from $52,783,000 in
fiscal 1994 to $77,602,000 in fiscal 1996. This recent growth has placed, and
may continue to place, strain on the Company's management and systems.
Accordingly, the Company's future operating results will depend, in part, on
the ability of its officers and other key employees to continue to implement
and improve its operational and financial control systems and to effectively
expand, train and manage its employee base. The Company's growth is also
dependent upon its distribution affiliates' ability to implement the Company's
products in response to the projected demands of the Company's customer base.
There can be no assurance that the Company or its affiliates will be able to
manage any future expansion successfully, and any inability to do so would have
a material adverse effect on the Company's business, financial condition and
results of operations. See "Management's Discussion and Analysis of Financial
Condition and Results of Operations."

Relationship with Marcam Solutions. The Company has entered into certain
agreements with Marcam Solutions which will govern certain aspects of the
parties' relationship on an ongoing basis that may be material to the conduct
of the Company's business, including the provision of certain administrative
services and indemnification obligations related to the Distribution. These
agreements would have a material adverse effect on the Company's business,
financial condition and results of operations if such agreements result in
significant liabilities to the Company. In addition, because the business to be
conducted by Marcam Solutions will be conducted through Marcam Corporation
until the Distribution, MAPICS may be liable for the liabilities of Marcam
Solutions relating to the period prior to the Distribution. If Marcam Solutions
for any reason is unable to satisfy its liabilities, MAPICS may be liable for
them. In addition, the Chief Financial Officer of Marcam Corporation is also
the Chief Financial Officer of Marcam Solutions. Following the Distribution,
this person will not be the Chief Financial Officer of the Company but will
become a director of the Company, while continuing to serve as Marcam
Solutions' Chief Financial Officer. See "Management." This person may have
conflicts of interest with respect to matters potentially or actually involving
or affecting the Company and Marcam Solutions. Such matters may require
consultation by such person with his legal advisors or a vote of the
disinterested directors of the Company only, concerning specific matters
presented to the Board of Directors of the Company. Notwithstanding such
precautions, there can be no assurance that any such potential conflict will be
resolved in a manner that will not adversely affect the interests of the
Company. See "The Distribution" and "Relationship Between MAPICS and Marcam
Solutions."

Dependence on Worldwide Manufacturing Industry. The Company's business
depends substantially upon the capital expenditures of mid-size manufacturers,
which expenditures depend in part upon the demand for such manufacturers'
products. A recession or other adverse events affecting the worldwide
manufacturing industry served by the Company could affect such demand, forcing
manufacturers in the Company's target market to curtail or postpone capital
expenditures on business information systems. Any such change in the amount or
timing of capital expenditures in its target market could have a material
adverse effect on the Company's business, financial condition and results of
operations.

Federal Income Tax Consequences and Liabilities. Marcam Corporation has
received a private letter ruling (the "Private Letter Ruling") from the Internal
Revenue Service (the "Service") substantially to the effect that, except as
provided below, the Distribution will qualify as a tax-free distribution to the
Company and its stockholders under the Internal Revenue Code of 1986, as amended
(the "Code").

10
<PAGE>

Accordingly, for federal income tax purposes, neither the Company nor its
stockholders should recognize taxable gain on the Distribution, except as
provided below. The Company, however, will recognize gain on the Distribution to
the extent that Marcam Solutions shares are received by stockholders who are not
United States persons ("non-U.S. persons"). The number of Marcam Solutions
shares expected to be distributed to non-U.S. persons is estimated to represent
not more than 19% of the total Marcam Solutions shares to be distributed in the
Distribution. Moreover, the Company may recognize additional gain with respect
to certain aspects of the Distribution, including certain restructuring
transactions expected to be consummated in connection with the Distribution. The
aggregate amount of gain recognized by the Company in connection with the
Distribution is not expected to result in any significant tax liability, but
rather is expected to be offset by existing net operating losses, to the extent
that such net operating losses, are not otherwise subject to limitation under
the Code. Accordingly, the amount of such net operating losses available to the
Company after the Distribution will likely be reduced. In connection with the
Asset Transfers, taxable gain may also be recognized in certain foreign
jurisdictions. Such gain would not generally be offset by existing domestic net
operating losses. The incurrence of significant tax liabilities by the Company,
in the event that the Distribution is not treated as a tax-free transaction, may
have a material adverse effect on the Company's business, financial condition
and results of operations.

In connection with the Distribution, Marcam Corporation and Marcam
Solutions have entered into a tax sharing agreement (the "Tax Sharing
Agreement") that defines the parties' rights and obligations with respect to
certain tax liabilities and refunds of taxes relating to Marcam Corporation's
business for periods ending on or prior to the date of the Distribution. In
general, pursuant to the Tax Sharing Agreement, Marcam Solutions shall be
responsible for certain state, local and foreign taxes for periods ending on or
before the date of the Distribution (and shall be entitled to refunds with
respect to such taxes), and the Company shall be responsible for all other
taxes for such periods (and shall be entitled to refunds with respect to such
taxes). In addition, under the Tax Sharing Agreement, the Company shall be
liable for any taxes arising out of the Distribution. The Tax Sharing Agreement
further provides for cooperation with respect to certain tax matters, the
exchange of information and the retention of records.

Uncertain Protection of Proprietary Technology. The Company's success is
heavily dependent upon protection of its proprietary software. The Company
relies on a combination of copyright, trademark and trade secret laws and
license and non-disclosure agreements, to establish and protect its proprietary
rights in its products. The Company enters into confidentiality and/or license
agreements with its employees, distributors, customers and potential customers,
and limits access to and distribution of its software, documentation, and other
proprietary information. There can be no assurance, however, that despite these
precautions, an unauthorized third party will not copy or reverse-engineer
certain portions of the Company's products or obtain and use information that
the Company regards as proprietary. In addition, the laws of some foreign
countries do not protect the Company's proprietary rights to the same extent as
do the laws of the U.S. There can be no assurance that the mechanisms used by
the Company to protect its software will be adequate or that the Company's
competitors will not independently develop software products that are
substantially equivalent or superior to the Company's software products.

In the future the Company may receive notices claiming that it is
infringing the proprietary rights of third parties and there can be no
assurance that the Company will not become the subject of infringement claims
or legal proceedings by third parties with respect to current or future
products. In addition, the Company may initiate claims or litigation against
third parties for infringement of the Company's proprietary rights or to
establish the validity of the Company's proprietary rights. Any such claim
could be time consuming, result in costly litigation, cause product shipment
delays or force the Company to enter into royalty or license agreements rather
than dispute the merits of such claims. Moreover, an adverse outcome in
litigation or similar adversarial proceedings could subject the Company to
significant liabilities to third parties, require the expenditure of
significant resources to develop non-infringing technology, require disputed
rights to be licensed from others or require the Company to cease the marketing
or use of certain products, any of which could have a material adverse effect
on the Company's business, financial condition and results of operations. To
the extent the Company desires or is required to obtain licenses to proprietary
rights of others, there can be no assurance that any such licenses will be made
available on terms acceptable to the Company, if at all. Claims against the
Company, with or without merit, as well as claims initiated by the Company
against third parties, can be time consuming and expensive to defend, prosecute
or resolve. See "Business--Proprietary Rights and Technology."

11
<PAGE>

Risks of Product Liability. The Company's products are generally used to
manage data critical to large organizations. As a result, the sale and support
of products by the Company may entail the risk of product liability claims.
While the Company's license agreements with its customers typically contain
provisions designed to limit the Company's exposure to potential product
liability claims, it is possible that such limitations of liability provisions
may not be effective under the laws of all jurisdictions. In addition, the
Company is insured for product liability protection against claims for personal
injury or damage to property, as well as for the customers losses for which the
Company is liable, although such insurance may not be sufficient to cover all
claims in the event the limitation of liability provisions contained in the
Company's license agreements are not effective. Although the Company has not
experienced any significant product liability claims to date, there can be no
assurance that the Company will not be subject to such claims in the future. A
successful product liability claim brought against the Company could have a
material adverse effect on the Company's business, financial condition and
results of operations. Moreover, defending such a suit, regardless of its
merits, could entail substantial expense and require the time and attention of
key management personnel, either of which could have a material adverse effect
on the Company's business, financial condition and results of operations.

Absence of Comparable Trading History for Common Stock; Possible Volatility
of Stock Price. As a result of the Distribution, historical trading prices of
the Common Stock of Marcam Corporation on the Nasdaq National Market are
unlikely to be indicative of future trading prices of the Company's Common
Stock. Following the Distribution, the Company's revenues will be substantially
lower than Marcam Corporation's consolidated revenues prior to the Distribution,
and management currently believes that the Company will have net income compared
to Marcam Corporation's net losses. Accordingly, as a result of the
Distribution, the trading prices of the Company's Common Stock immediately after
the Distribution may be less than, equal to or greater than the trading prices
of Marcam Corporation's Common Stock immediately prior to the Distribution. The
initial price to the public of the Common Stock to be sold in the Offering has
been determined by negotiations between the Company and the Underwriters. See
"Underwriting" for a discussion of the factors considered in this connection.

The market price of the Company's Common Stock could be subject to
significant volatility due to a number of factors, including the continuing
depth and liquidity of the market for the Common Stock, investor perception of
the Company and the market for ERP software applications generally, the
announcement of new products or product enhancements by the Company or its
competitors, quarterly variations in the Company's operating results or
operating results of its competitors or companies in related industries,
changes in earnings or revenue estimates or recommendations by securities
analysts, developments in the Company's industry, general market conditions and
other factors, including factors unrelated to the operating performance of the
Company or its competitors. Such factors and fluctuations, as well as general
economic, political and market conditions, such as recessions, could materially
and adversely affect the market price of the Company's Common Stock. Such
prices may also be affected by certain provisions of the Company's articles of
organization and by-laws, the Company's Rights Plan and other matters described
in this Prospectus which may have an anti-takeover effect.

Risks Associated with International Operations and Currency
Fluctuations. A material portion of the Company's business comes from outside
the U.S. The Company derived approximately 22%, 27%, and 27% of its total
revenues from customers located outside of the U.S. in 1994, 1995, and 1996,
respectively. The Company believes that its continued growth and profitability
will require expansion of its sales in international markets. To successfully
expand international sales, the Company has utilized, and will continue to
utilize, substantial resources to enlarge existing foreign operations,
establish additional foreign operations and hire additional personnel.
International expansion of the Company's operations has required, and will
continue to require, the Company to translate and localize its application
modules. To the extent the Company is unable to expand its international
operations or translate and localize its application modules in a timely
manner, it is likely to adversely impact the Company's operating results. In
addition, even if international operations are successfully expanded, there can
be no assurance that the Company will be able to maintain or increase
international market presence or demand for its products.

Risks inherent in the Company's international business activities include
imposition of government controls, restrictions on the export of critical
technology, political and economic instability (including fluctuations in
foreign

12
<PAGE>

currency exchange rates), trade restrictions, difficulties in staffing
international offices, longer accounts receivable payment collection cycles in
certain countries, burdens of complying with a wide variety of foreign laws and
regulations, management of an organization spread over various countries,
unexpected changes in regulatory requirements and overlap of different tax
structures. In addition, effective copyright, trademark and trade secret
protection may not be available in every foreign country in which the Company
sells its products. As a result of the continued expansion of the Company's
international operations, the fluctuations in the value of foreign currencies
in which the Company conducts its business may cause currency transaction gains
and losses. To date, currency transaction gains and losses have not been
material. However, due to the number of foreign currencies involved, the
constantly changing currency exposures and volatility of currency exchange
rates, the Company cannot predict the effect of exchange rate fluctuations upon
future operating results. The Company's business, financial condition and
results of operations could be materially adversely affected by any of these
factors.

Anti-Takeover Provisions; Rights Plan; Issuance of Preferred Stock. The
Company's Restated Articles of Organization and Amended and Restated By-laws
contain provisions that may make it more difficult for a third party to
acquire, or discourage acquisition bids for, or discourage changes in
management of, the Company. These provisions could limit the price that certain
investors might be willing to pay in the future for shares of the Company's
Common Stock. Also, the Company has adopted a Stockholder Rights Plan, pursuant
to which the Company has distributed to its stockholders rights to purchase
shares of junior participating preferred stock (the "Rights Plan"). Upon
certain triggering events, such rights become exercisable to purchase the
Company's Common Stock at a price substantially discounted from the then
applicable market price of the Company's Common Stock. The Rights Plan could
generally discourage a merger or tender offer involving the securities of the
Company that is not approved by the Company's Board of Directors by increasing
the cost of effecting any such transaction and, accordingly, could have an
adverse impact on stockholders who might want to vote in favor of such merger
or participate in such tender offer. In addition, shares of the Company's
Preferred Stock have been issued in the past and may be issued in the future
without further stockholder approval and upon such terms and conditions, and
having such rights, privileges and preferences, as the Board of Directors may
determine. The rights of the holders of Common Stock are subject to, and may be
adversely affected by, the rights of the holders of Preferred Stock currently
outstanding and will be subject to, and may be adversely affected by, the
rights of any holders of Preferred Stock that may be issued in the future. The
issuance of Preferred Stock, while providing desirable flexibility in
connection with possible acquisitions and other corporate purposes, could have
the effect of making it more difficult for a third party to acquire, or of
discouraging a third party from acquiring, a majority of the outstanding voting
stock of the Company. The Company has no present plans to issue any additional
shares of Preferred Stock. The Company's Board of Directors is divided into
three classes, each of which serves for a staggered three-year term. Such
staggered Board may make it more difficult for a third party to gain control of
the Company's Board of Directors. The Amended and Restated By-laws impose
various procedural and other requirements that could make it more difficult for
stockholders to effect certain corporate actions. See "Description of Capital
Stock."

Shares Eligible for Future Sale; Registration Rights. Sales of substantial
numbers of shares of Common Stock, or the prospect of such sales, could
adversely affect the market price of the Common Stock and the Company's ability
to raise needed capital in the capital markets at a time and price favorable to
the Company. Upon completion of this Offering and based upon the number of
shares outstanding as of May 31, 1997, the Company will have a total of
17,535,010 shares of Common Stock outstanding, of which the 6,000,000 shares
offered hereby will be freely tradeable without restriction under the Securities
Act of 1933, as amended (the "Securities Act"), by persons other than
"affiliates" of the Company, as defined under the Securities Act. The remaining
11,535,010 outstanding shares of Common Stock will be eligible for sale in the
public market following the Offering, except for shares of Common Stock subject
to lock-up agreements described below and shares of Common Stock held or
subsequently purchased by affiliates of the Company. Of these shares, an
aggregate of 242,587 shares are subject to lock-up agreements with the
representatives of the Underwriters expiring 180 days following the date of this
Prospectus (the "Lock-Up Agreements"). Such agreements provide that the
representatives may, in their sole discretion and at any time without notice,
release all or a portion of the shares subject to these Lock-Up Agreements. The
remaining shares are not subject to Lock-Up Agreements and substantially all of
these shares are eligible for immediate sale into the public market.

As of May 31, 1997, the Company had options to purchase an aggregate of
2,626,132 shares outstanding under its existing stock option plans and had an
additional 1,886,713 shares of Common Stock reserved for issuance pursuant to
these plans. In addition, the Company maintains an employee stock purchase plan
pursuant to which it has 152,281 shares of Common Stock reserved for issuance.
Any shares of Common Stock issued upon the

13
<PAGE>

exercise of such outstanding options or any options granted in the future will
be, upon issuance, freely tradeable in the public market, except for shares
subject to Lock-Up Agreements and shares held by affiliates of the Company. Of
the outstanding options, 1,595,958 shares issuable upon exercise of such options
are exercisable within 180 days of the date of this Prospectus and of these
shares of Common Stock, 353,561 shares are subject to Lock-Up Agreements. In
connection with the Distribution, the exercise prices of the options will be
decreased on a basis intended to preserve the spread value of the existing
options. See "The Distribution." The Company also has in effect a registration
statement under the Securities Act covering the sale of 383,333 shares of Common
Stock issuable upon the exercise of warrants exercisable at a price of $8.93 per
share. These shares of Common Stock are not subject to Lock-Up Agreements. In
connection with the Distribution, the exercise price will be decreased and the
number of underlying shares will be increased on a basis intended to preserve
the spread value of the warrants. Upon the adjustment of the number of shares
issuable upon exercise of such warrants as a result of the Distribution, the
Company is obligated pursuant to the terms of a registration rights agreement
with the holders of such warrants to register such additional shares of Common
Stock for resale under the Securities Act. See "The Distribution."

The holders of the Company's convertible preferred stock currently
convertible into 3,250,000 shares of Common Stock and the holders of warrants
currently exercisable for 1,000,000 shares of Common Stock at an exercise price
of $15.36 are entitled to certain demand registration rights with respect to
such shares of Common Stock commencing on or after July 23, 1998 and are also
entitled to piggy-back registration rights. If the Company were required to
include in a Company-initiated registration shares held by such holders pursuant
to the exercise of their piggyback registration rights, such sale might have an
adverse effect on the Company's ability to raise needed capital in the capital
markets at a time and price favorable to the Company. In connection with the
Distribution, the exercise price of the warrants will be decreased on a basis
intended to preserve the spread value of the warrants. See "The Distribution."
In addition, the shares of Common Stock underlying the convertible preferred
stock currently are eligible for sale in the public market subject to the
conditions of Rule 144. Of the 4,250,000 shares underlying the convertible
preferred stock and warrants, 4,000,000 are subject to Lock-Up Agreements.

14
<PAGE>

USE OF PROCEEDS

The net proceeds to the Company from the sale of the shares of Common
Stock offered by the Company hereby are estimated to be approximately
$48,470,000 ($56,003,000 if the Underwriters' over-allotment option is
exercised in full), after deducting underwriting discounts and
commissions and estimated offering expenses.

The Company currently intends to use the net proceeds from the Offering to
repay the indebtedness incurred in the Debt Financing. The net proceeds from the
Debt Financing were used to make the $39 million cash transfer by Marcam
Corporation to Marcam Solutions in connection with the Distribution and to repay
Marcam Corporation's $25 million of 9.82% Subordinated Notes due 2001 (the
"Subordinated Notes"). The indebtedness incurred in the Debt Financing currently
bears interest at the rate of 9%, is payable on August 4, 1997 and is secured by
liens on substantially all of the Company's assets. In addition, the Company
currently intends to use borrowings under the proposed $30 million senior
secured revolving credit and term loan facility to repay any amounts borrowed in
the Debt Financing which are not repaid with the net proceeds from the Offering.
If the proposed credit facility is not consummated on or before August 4, 1997,
the Company will be required to seek alternative sources of additional funds to
repay the indebtedness incurred in the Debt Financing. There can be no assurance
that the Company will be able to consummate the proposed credit facility on or
before August 4, 1997 or, in the alternative, that additional financing will be
available or available on terms acceptable to the Company. See "Management's
Discussion and Analysis of Financial Condition and Results of
Operations--Liquidity and Capital Resources."

DIVIDEND POLICY

Marcam Corporation has never paid any cash dividends on its Common Stock.
The Company currently intends to retain future earnings to fund future
development and growth and the operation of its business, and therefore does not
anticipate paying any cash dividends in the foreseeable future. Covenants in the
revolving credit facility prohibit the payment of cash dividends. Any future
determination to pay cash dividends will be at the discretion of the Board of
Directors and will be dependent upon the Company's results of operations,
financial condition, capital requirements and such other factors as the Board of
Directors deems relevant.

15
<PAGE>

CAPITALIZATION

The following table sets forth the capitalization of the Company as of
March 31, 1997 (i) on an actual basis, (ii) on a pro forma basis reflecting the
Distribution and certain other matters, and (iii) on a pro forma as adjusted
basis reflecting the Distribution, certain other matters, the sale of shares of
Common Stock offered hereby and the application of the estimated net proceeds
therefrom. This table should be read in conjunction with the Combined Financial
Statements and related Notes thereto appearing elsewhere in this Prospectus. See
also "Use of Proceeds," "Selected Combined Financial Data," "Management's
Discussion and Analysis of Financial Condition and Results of Operations" and
"Description of Capital Stock."

<TABLE>
<CAPTION>
As of March 31, 1997
-------------------------------------------
Pro Forma As
Actual Pro Forma(A) Adjusted(A)(B)
(In thousands, except per share data)
<S> <C> <C> <C>

Cash and cash equivalents ........................ $ 852 $ 852 $ 852
======= ========== ==========
Total debt ....................................... $ -- $ 64,000 $ 15,530
------- ---------- ----------
Divisional equity ................................. 9,228 -- --
Stockholders' equity:
Preferred stock, $1.00 par value; 1,000 shares
authorized
Series D Convertible Preferred Stock,
225 shares issued and outstanding pro forma
and pro forma as adjusted ..................... -- 225 225
Series E Convertible Preferred Stock,
100 shares issued and outstanding pro forma
and pro forma as adjusted ..................... -- 100 100
Common stock, $.01 par value; 50,000 shares
authorized; 11,497 shares issued and
outstanding pro forma; 17,497 shares issued
and outstanding pro forma as adjusted (C) ...... -- 115 175
Additional paid in-capital ..................... -- -- 48,410
Retained earnings (accumulated deficit) ......... -- (55,212) (55,212)
------- ---------- ----------
Total stockholders' equity (deficit) ............ -- (54,772) (6,302)
------- ---------- ----------
Total capitalization .............................. $9,228 $ 9,228 $ 9,228
======= ========== ==========
</TABLE>

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

(A) Adjusted to give effect to the Distribution and the Debt Financing, the
proceeds of which were used to repay Marcam Corporation's $25.0 million
9.82% Subordinated Notes due 2001 (assumed by the Company for accounting
purposes) and to make the $39.0 million cash transfer to Marcam Solutions.
(B) Adjusted to give effect to the sale of shares of Common Stock offered by
the Company hereby and the application of the estimated net proceeds
therefrom. See "Use of Proceeds" and "Description of Capital Stock."
(C) Does not include (i) 1,383,333 shares of Common Stock (subject to
adjustment) issuable upon the exercise of warrants outstanding as of March
31, 1997 with a weighted average exercise price of $13.58 per share and
(ii) 2,663,452 shares of Common Stock issuable upon the exercise of stock
options outstanding as of March 31, 1997 with a weighted average exercise
price of $14.64 per share. In connection with the Distribution, the
exercise prices of the warrants and the options will be reduced, and the
number of shares of Common Stock issuable upon exercise of certain of the
warrants will be increased, on a basis intended to preserve the spread
value of the warrants and options. See "The Distribution" and "Description
of Capital Stock."

16
<PAGE>

SELECTED COMBINED FINANCIAL DATA(A)

The following table sets forth selected combined financial data of the
Company as of and for the years ended September 30, 1994, 1995 and 1996, for
the six months ended March 31, 1996 and 1997, and as of March 31, 1997. The
selected combined financial data as of September 30, 1995 and 1996, for each of
the three years in the period ended September 30, 1996, and as of and for the
six months ended March 31, 1997 have been derived from the Company's combined
financial statements which have been audited by Coopers & Lybrand L.L.P.,
independent public accountants, as indicated in their report. The selected
combined financial data as of September 30, 1994 and for the six months ended
March 31, 1996 have been derived from the Company's unaudited combined
financial statements which, in the opinion of management of MAPICS, have been
prepared on the same basis as the audited combined financial statements and
include all adjustments, consisting only of normal recurring accruals,
necessary for a fair presentation of the financial position and the results of
operations for these periods. Operating results for the six months ended March
31, 1997 are not necessarily indicative of the results to be expected for the
entire year. These data should be read in conjunction with "Management's
Discussion and Analysis of Financial Condition and Results of Operations" and
the Combined Financial Statements and Notes thereto included elsewhere in this
Prospectus.

Statement of Operations Data:
Revenues:
License ........................ $33,410 $42,745 $45,341 $20,501 $25,328
Services ........................ 19,373 26,553 32,261 15,343 18,837
-------- -------- -------- -------- --------
Total revenues .................. 52,783 69,298 77,602 35,844 44,165
Operating expenses:
Cost of license revenues ......... 3,280 5,689 6,913 3,026 4,129
Cost of services revenues ...... 5,428 7,567 9,499 4,573 5,301
Selling and marketing ............ 17,765 24,780 27,851 13,028 14,834
Product development ............ 6,692 7,432 6,398 3,122 4,969
General and administrative ...... 4,810 5,384 5,965 2,212 4,360
-------- -------- -------- -------- --------
Total operating expenses ...... 37,975 50,852 56,626 25,961 33,593
Operating income .................. 14,808 18,446 20,976 9,883 10,572
Income tax expense ............... 4,641 7,112 8,076 3,805 4,071
-------- -------- -------- -------- --------
Net income ........................ $10,167 $11,334 $12,900 $ 6,078 $ 6,501
======== ======== ======== ======== ========
Pro forma net income per common
share (B) ........................ $ 0.70 $ 0.34
======== ========
Pro forma weighted average
number of common shares
outstanding (B) .................. 18,518 19,324
======== ========
</TABLE>

<TABLE>
<CAPTION>
As of September 30, As of March 31,
------------------------------------------- ----------------
1994 1995 1996 1997
(In thousands)
<S> <C> <C> <C> <C>
Balance Sheet Data:
Cash and cash equivalents ......... $ 107 $ 226 $ 378 $ 852
Working capital (deficit) (C) ...... (2,040) (8,527) (13,945) (13,999)
Total assets ........................ 36,392 41,226 45,405 46,646
Long-term liabilities ............... 493 196 884 394
Divisional equity .................. 17,091 11,492 9,193 9,228
</TABLE>

- ------------
(A) See Notes to Combined Financial Statements appearing elsewhere in this
Prospectus.
(B) See Note 2 of Notes to Combined Financial Statements for information
concerning the computation of per share earnings.
(C) Includes $9.7 million, $15.2 million, $18.6 million and $21.2 million of
deferred revenue at September 30, 1994, 1995, 1996 and
March 31, 1997, respectively.

17
<PAGE>

MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis should be read in conjunction with
"Selected Combined Financial Data" and the combined financial statements and
notes thereto included elsewhere in this Prospectus. The discussion in this
Prospectus contains forward-looking statements that involve risks and
uncertainties, such as statements of the Company's plans, objectives,
expectations and intentions. The cautionary statements made in this Prospectus
should be read as being applicable to all related forward-looking statements
wherever they appear in this Prospectus. The Company's actual results could
differ materially from those discussed herein. Factors that could cause or
contribute to such differences include those discussed in "Risk Factors" as
well as those discussed elsewhere herein.

Overview

The MAPICS product line was initially introduced by International Business
Machines Corporation ("IBM") in 1978 to provide integrated application software
for accounting, manufacturing and logistics for mid-size manufacturers. In
February 1993, Marcam Corporation acquired the exclusive marketing and
licensing rights to the MAPICS products from IBM and began managing the
development and support of the MAPICS products. In September 1995, Marcam
Corporation acquired all of the outstanding capital stock of the company that
owned the MAPICS products. The combined financial statements and other
financial information included in this Prospectus have been prepared using
Marcam Corporation's historical basis in the assets, liabilities and historical
results of operations of the business related to the MAPICS products. See Notes
to Combined Financial Statements.

The Company generates revenues primarily from licensing its software. When
it first licenses its software, the Company receives both an initial license
fee and a periodic license fee. The periodic license fee, which is typically
paid annually in advance thereafter, entitles the customer to continue using
the software and to receive certain support services. If a customer does not
renew its periodic license, it is no longer entitled to use the Company's
software. The Company believes this licensing arrangement provides it with
recurring revenues from its installed base of customers and enables customers
to take advantage of new releases and enhancements of its software. Initial
license fees are recorded as license revenues, and periodic license fees are
recorded as services revenues and recognized ratably over the period.

The Company's cost structure is designed so that a significant portion of
its costs vary in direct relation to license revenues, particularly its selling
and marketing expenses and cost of license revenues. The MAPICS products are
sold primarily through the Company's network of independent local affiliates,
with support from the Company's sales management. The Company's single largest
expense is commissions paid to these affiliates, which are based on the
revenues they generate from selling licenses to the MAPICS products. The
Company currently expects that as its affiliates generate increasing license
revenues, selling and marketing expenses will decrease as a percentage of
revenues because of the relatively fixed cost of the Company's direct selling
and marketing activities. The affiliates, not the Company, provide the
Company's customers with consulting and implementation services relating to the
MAPICS products. As a result, the Company neither receives revenues from
providing consulting and implementation services, nor bears the fixed costs
inherent in maintaining a services business.

In Japan and certain Eastern European countries, the Company utilizes
resellers rather than affiliates to distribute the MAPICS products and the
Company records as license revenues the net royalties received from the
resellers without any corresponding commission expenses. From 1994 to 1996, net
royalties received from such resellers decreased from 17.0% to 1.3% of total
license revenues. The Company's strategy has been to replace these resellers
with affiliates in order to provide the Company with a more direct relationship
with its customers. This shift generally has resulted in an increase in selling
and marketing expense as a percentage of revenues and a decrease in the
operating margin percentage. The Company believes that the proportion of
reseller sales to total license revenues will remain relatively constant for
the foreseeable future.

Cost of license revenues consists primarily of royalties paid to Solution
Partners with respect to products licensed by the Company and amortization of
software development costs. The Company expects that cost of license revenues
will vary based on the mix of products licensed during the applicable period
between Company-developed products and Solution Partner-developed products. The
Company licenses from its Solution Partners complementary software products
which have been integrated into the MAPICS product line. When the Company

18
<PAGE>

licenses a Solution Partner product to a customer, the Company pays a royalty
to the Solution Partner. As a result, a significant portion of its cost of
license revenues varies in direct relation to license revenues based on
Solution Partners' products. Through its Solution Partner arrangements, the
Company has been able to both enhance the functionality of its existing
products and introduce new products utilizing this variable cost approach to
expand its product offerings. During the past three fiscal years, the mix of
products licensed by the Company has included increasing percentages of
Solution Partner products, which has resulted in both increasing revenues and
royalty costs.

The Company's capitalized software development costs result primarily from
internal software development activities and the translation of software into
various foreign languages. The Company has typically amortized its capitalized
software development and translation costs over five years. As of March 31,
1997, the Company's balance sheet reflected approximately four years of
accumulated capitalized software development costs, because the Company did not
begin capitalizing software until the acquisition of the exclusive marketing
and licensing rights to the MAPICS products in February 1993. Consequently, the
Company currently expects amortization of these costs to continue to increase
through fiscal 1998, when five years of software development costs will have
been capitalized. In addition, in fiscal 1997 the Company made a decision to
amortize its 1997 and future translation expenditures over a revised useful
life of two years rather than five years. This decision resulted, beginning in
the first quarter of fiscal 1997, and will continue to result, in an increase
in amortization expense compared with fiscal 1996.

In the U.S. and Canada, the Company is the provider of support services
(primarily via telephone) to its customers. Elsewhere, the Company engages
local affiliates to provide varying degrees of support services for a fee. For
certain Solution Partner-developed products, the Solution Partners provide
varying levels of support for a fee. The costs of the Company's direct support
services and the fees paid to affiliates and Solution Partners for providing
support services are recorded as costs of services revenues.

In 1996, the Company reduced its level of spending on product development
activities other than translation of products ("core product development")
because, at the time, Marcam Corporation anticipated that the MAPICS products
would use certain technologies being developed in connection with its Protean
and Avantis product lines. Subsequently, the Company determined that such a
development strategy was not consistent with the demands of its target market
and commenced a revised development strategy which will allow future platform
independence. The Company anticipates continuing its efforts to develop
additional versions of certain of its applications to run on Microsoft's NT
server platforms. The Company does not believe that such additional versions
will materially affect results of operations or liquidity. The Company
currently anticipates that core product development expenditures will increase
as a percentage of revenues to levels more consistent with those of 1994 and
1995. Costs of establishing technological feasibility of computer software
products are charged to product development expense as they are incurred.
Consequently, the Company's operating results may be affected adversely by
significant changes in the level of product development investments.

Certain expenses presented in the combined financial statements and other
financial information included in this Prospectus have been allocated based on
management's estimates of the cost of services provided to the Company by
Marcam Corporation. The Company's management believes that these allocations
are reasonable. The combined financial statements and other financial
information included in this Prospectus, however, may not necessarily reflect
the combined financial position, results of operations and cash flows of the
Company had it operated as a separate entity during the periods presented, or
what they may be in the future. See "Risk Factors-- Absence of History as a
Stand-Alone Public Company" and Notes to Combined Financial Statements.

19
<PAGE>

Results of Operations

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

<TABLE>
<CAPTION>
Six Months Ended
Fiscal Years Ended September 30, March 31,
------------------------------------ -----------------------
1994 1995 1996 1996 1997
<S> <C> <C> <C> <C> <C>
Revenues:
License ........................ 63.3% 61.7% 58.4% 57.2% 57.3%
Services ........................ 36.7 38.3 41.6 42.8 42.7
------ ------ ------ ------ ------
Total revenues .................. 100.0 100.0 100.0 100.0 100.0
Operating expenses:
Cost of license revenues ......... 6.2 8.2 8.9 8.4 9.3
Cost of services revenues ...... 10.3 10.9 12.2 12.8 12.0
Selling and marketing ............ 33.7 35.8 35.9 36.3 33.6
Product development ............ 12.7 10.7 8.3 8.7 11.3
General and administrative ...... 9.1 7.8 7.7 6.2 9.9
------ ------ ------ ------ ------
Total operating expenses ...... 72.0 73.4 73.0 72.4 76.1
------ ------ ------ ------ ------
Operating income .................. 28.0 26.6 27.0 27.6 23.9
Income tax expense ............... 8.8 10.3 10.4 10.6 9.2
------ ------ ------ ------ ------
Net income ........................ 19.2% 16.3% 16.6% 17.0% 14.7%
====== ====== ====== ====== ======
</TABLE>

Six Months ended March 31, 1997 Compared to Six Months ended March 31, 1996

Revenues. The Company generates revenues from licensing its software.
Total revenues increased 23.2% to $44.2 million for the six months ended March
31, 1997 from $35.8 million for the six months ended March 31, 1996. License
revenues increased 23.5% to $25.3 million for the six months ended March 31,
1997 from $20.5 million for the six months ended March 31, 1996. This increase
resulted primarily from an increase of license sales to new customers, and to a
lesser extent, an increase of license sales to existing customers for new
sites, upgraded systems and additional modules, particularly in the U.S.,
Canada and the Europe, Middle East and Africa region ("EMEA"). Services
revenues increased 22.8% to $18.8 million for the six months ended March 31,
1997 from $15.3 million for the six months ended March 31, 1996, principally
due to the increase in the Company's installed customer base and additional
optional support offerings that were made available in the second quarter of
fiscal 1996 in EMEA to customers who had licensed MAPICS products from IBM
without support services.

Cost of License Revenues. Cost of license revenues consists primarily of
royalties paid to Solution Partners with respect to products licensed by the
Company and amortization of capitalized software development costs. Cost of
license revenues increased 36.5% to $4.1 million for the six months ended March
31, 1997 from $3.0 million for the six months ended March 31, 1996. These costs
increased as a percentage of license revenues to 16.3% from 14.8% for the six
months ended March 31, 1997 and 1996, respectively. These increases were
primarily due to increased royalty costs as the volume of Solution Partner
products licensed by the Company increased from the 1996 period to the 1997
period and increased amortization of capitalized software development and
translation costs which resulted from the increased capitalized software asset.

Cost of Services Revenues. Cost of services revenues consists primarily of
personnel costs related to the ongoing maintenance and support of the MAPICS
products, fees paid to affiliates outside the U.S. and Canada to provide
certain support services in those regions, and the fees paid to Solution
Partners to provide similar services with respect to their products. Cost of
services revenues increased 15.9% to $5.3 million for the six months ended
March 31, 1997 from $4.6 million for the six months ended March 31, 1996,
primarily as a result of the increased fees paid to affiliates and Solution
Partners for providing support services. As a percentage of services revenues,
these costs decreased to 28.1% from 29.8% for the six months ended March 31,
1997 and 1996, respectively. This decrease resulted primarily from the
relatively fixed personnel costs in the Company's support services organization
which were offset in part by the increased fees paid to Solution Partners and
affiliates for support services in the 1997 period.

20
<PAGE>

Selling and Marketing. Selling and marketing expenses consist primarily of
commissions paid to the Company's independent affiliates, compensation for the
Company's sales and marketing personnel and direct costs associated with the
Company's marketing campaigns. Selling and marketing expenses increased 13.9%
to $14.8 million for the six months ended March 31, 1997 from $13.0 million for
the six months ended March 31, 1996. This increase in the 1997 period was due
primarily to increased commissions earned by affiliates on increased license
revenues. As a percentage of revenues, selling and marketing expenses decreased
to 33.6% from 36.3% for the six months ended March 31, 1997 and 1996,
respectively. This decrease resulted primarily from the Company's direct
selling and marketing costs being relatively fixed in nature.

Product Development. Product development expenses consist primarily of
compensation for software engineering personnel and independent contractors
retained to assist in the Company's product development efforts. Costs of
establishing technological feasibility of computer software products are
charged to product development expense as they are incurred. Thereafter,
certain software development costs and the cost of translating software
products into different foreign languages are capitalized in accordance with
Statement of Financial Accounting Standards No. 86. Capitalized software
development costs are amortized over the useful lives of such products, which
are generally five years (except for translation expenditures capitalized in
1997 which are being amortized over two years). Amortization expense is charged
to cost of license revenues.

Overall, product development expenses increased 59.2% to $5.0 million for
the six months ended March 31, 1997 from $3.1 million for the six months ended
March 31, 1996 and increased as a percentage of revenues to 11.3% from 8.7% for
the six months ended March 31, 1997 and 1996, respectively. These increases
resulted primarily from lower costs qualifying for capitalization in 1997 than
in 1996 due to the Company's core development efforts. See "Overview" and
"Business--Product Development."

Gross core development expenditures increased 16.3% to $6.0 million for
the six months ended March 31, 1997 from $5.2 million for the six months ended
March 31, 1996. This increase was primarily due to increased development
expenditures as a result of the Company's change in product development
strategy. See "Overview" and "Business--Product Development." The amounts of
core development expenditures capitalized for the six months ended March 31,
1997 and 1996 were $1.2 million and $2.2 million, respectively, representing
19.1% and 42.1% of gross core development expenditures during those periods.
The amounts of development expenditures capitalized during the period decreased
because a higher proportion of development expenditures were related to the
establishment of technological feasibility of the Company's revised development
strategy. Gross translation expenditures decreased 30.8% to $1.3 million for
the six months ended March 31, 1997 from $1.9 million for the six months ended
March 31, 1996. Translation expenditures are typically project related and the
timing of these expenditures is subject to change from period to period. The
amounts of translation costs capitalized for the six months ended March 31,
1997 and 1996 were $1.2 million and $1.8 million, respectively, representing
93.8% of gross translation expenditures during both periods.

General and Administrative. General and administrative expenses consist
primarily of salaries of executive, financial, legal and administrative
personnel, outside professional and service fees and provisions for bad debts.
General and administrative expenses increased 97.1% to $4.4 million for the six
months ended March 31, 1997 from $2.2 million for the six months ended March
31, 1996 due primarily to an increase in the provision for bad debts, as well
as increases in facilities and personnel costs. General and administrative
expenses represented 9.9% of revenues for the six months ended March 31, 1997
as compared to 6.2% for the six months ended March 31, 1996. The level of
general and administrative expenses for the 1996 period was relatively low
primarily because the Company recorded less bad debt expense due to available
reserves.

Provision for Income Taxes. Income tax expense represented 38.5% of income
before tax expense for the six months ended March 31, 1997 and 1996. The
effective tax rates for both periods exceeded the statutory federal rate
largely due to the impact of state income taxes, partially offset by research
and experimentation credits.

Fiscal 1996 Compared to Fiscal 1995

Revenues. Total revenues increased 12.0% to $77.6 million in 1996 from
$69.3 million in 1995. License revenues increased 6.1% to $45.3 million in 1996
from $42.7 million in 1995. This increase resulted primarily from an increase
of license sales to new and existing customers for new sites, upgraded systems
and additional modules, particularly outside the U.S. and Canada. This increase
was primarily attributable to the availability of French,

21
<PAGE>

German, Spanish and Portuguese translations of Release 2 of MAPICS XA. Services
revenues increased 21.5% to $32.3 million in 1996 from $26.6 million in 1995,
principally due to the increase in the Company's installed customer base and
revenues from optional support services offered in EMEA to customers who had
licensed MAPICS products from IBM without support services.

Cost of License Revenues. Cost of license revenues increased 21.5% to $6.9
million from $5.7 million in 1995 and represented 15.2% and 13.3% of license
revenues in 1996 and 1995, respectively. This increase was primarily due to
increased royalty costs as the volume of Solution Partner products licensed by
the Company increased from 1995 to 1996 and increased amortization of
capitalized software development and translation costs which resulted from the
increased capitalized software asset.

Cost of Services Revenues. Cost of services revenues increased 25.5% to
$9.5 million from $7.6 million in 1995 and represented 29.4% and 28.5% of
services revenues in 1996 and 1995, respectively. This increase was primarily
due to increases in staff and other costs in 1996 to support the growing base
of customers in EMEA.

Selling and Marketing. Selling and marketing expenses increased 12.4% to
$27.9 million in 1996 from $24.8 million in 1995 and represented 35.9% and
35.8% of total revenues in 1996 and 1995, respectively. The increase in these
expenses resulted primarily from increased commissions earned by affiliates on
increased revenues. As a percentage of total revenues, these expenses remained
relatively constant as a result of changes in the mix of revenues from
affiliates and resellers. See "Overview."

Product Development. Overall, product development expenses decreased 13.9%
to $6.4 million from $7.4 million in 1995 and represented 8.3% and 10.7% of
total revenues in 1996 and 1995, respectively. These decreases resulted
primarily from lower core development expenditures in 1996. See "Overview" and
"Business--Product Development."

Gross core development expenditures decreased 9.9% to $9.1 million for
1996 from $10.0 million for 1995. This decrease was due primarily to the change
in the Company's development strategy. See "Overview." The amounts of core
development expenditures capitalized for 1996 and 1995 were $2.9 million and
$2.8 million, respectively, representing 31.9% and 28.2% of gross core
development expenditures during those periods. Gross translation expenditures
increased 27.6% to $3.7 million for 1996 from $2.9 million for 1995. The
amounts of translation costs capitalized for 1996 and 1995 were $3.5 million
and $2.7 million, respectively, representing 93.6% and 92.4% of gross
translation expenditures during those periods.

General and Administrative. General and administrative expenses increased
10.8% to $6.0 million from $5.4 million in 1995 and represented 7.7% and 7.8%
of total revenues in 1996 and 1995, respectively. The overall increase was
primarily due to expansion of staff and facilities in EMEA.

Provision for Income Taxes. Income tax expense represented 38.5% and 38.6%
of income before income tax for fiscal years 1996 and 1995, respectively. The
effective tax rates for both periods exceeded the statutory federal rate
largely due to the impact of state income taxes, partially offset by research
and experimentation credits.

Fiscal 1995 Compared to Fiscal 1994

Revenues. Total revenues increased 31.3% to $69.3 million in 1995 from
$52.8 million in 1994. License revenues grew 27.9% to $42.7 million in 1995
from $33.4 million in 1994. This increase resulted primarily from increased
licensing volume both to new customers and to existing customers for new sites,
upgraded systems and additional modules, particularly in the U.S. and Canada.
The Company believes that this increase was attributable to the availability of
the significant enhancements in Release 2 of MAPICS XA and improvements in
affiliate productivity outside North America.

Services revenues increased 37.1% to $26.6 million in 1995 from $19.4
million in 1994. This increase was primarily attributable to the inclusion in
1995 of periodic license fee revenues for a full year. In connection with the
transactions relating to the MAPICS products which occurred in February 1993,
none of the periodic license fees billed by IBM prior to the closing were
transferred to the Company. The Company began recognizing periodic license fee
revenues only after the period for which the customer paid IBM expired.
Periodic license fees were typically billed on the anniversary of the original
license of the software, although revenues from those fees were recognized
ratably during the period. Consequently, the Company did not recognize a full
year of periodic license

22
<PAGE>

fee revenues during 1994. In addition, the Company recognized revenues from
optional support services offered in Europe to customers who had licensed
MAPICS products from IBM without support services.

Cost of License Revenues. Cost of license revenues increased 73.4% to $5.7
million from $3.3 million in 1994 and represented 13.3% and 9.8% of license
revenues in 1995 and 1994, respectively. This increase was primarily due to
increased royalty costs as the volume of Solution Partner products licensed by
the Company increased from 1994 to 1995 and increased amortization of
capitalized software development and translation costs which resulted from the
increased capitalized software asset.

Cost of Services Revenues. Cost of services revenues increased 39.4% to
$7.6 million from $5.4 million in 1994 and represented 28.5% and 28.0% of
services revenues in 1995 and 1994, respectively. This increase resulted
primarily from increased personnel costs associated with expansion of the
Company's North American and European support capabilities.

Selling and Marketing. Selling and marketing expenses increased 39.5% to
$24.8 million in 1995 from $17.8 million in 1994. This increase was due
primarily to increased commissions earned by affiliates on increased license
revenues. Selling and marketing expenses increased as a percentage of total
revenues from 33.7% to 35.8% from 1994 to 1995. This increase was primarily
attributable to a decrease in the proportion of revenues received in 1995 from
affiliates who act as resellers whereby the Company only records as license
revenues the net proceeds from the affiliate and no corresponding commission
expense is recognized, as well as expansion of the Company's direct marketing
programs.

Product Development. Overall, product development expenses increased 11.1%
to $7.4 million in 1995 from $6.7 million in 1994 and represented 10.7% and
12.7% of revenues in 1995 and 1994, respectively. These increases were due to
lower amounts of core development costs qualifying for capitalization in 1995.

Gross core development expenditures decreased 5.5% to $10.0 million for
1995 from $10.6 million for 1994. The amounts of core development expenditures
capitalized for 1995 and 1994 were $2.8 million and $4.1 million, respectively,
representing 28.2% and 39.0% of gross core development expenditures during
those periods. Gross translation expenditures increased 237.4% to $2.9 million
for 1995 from $0.9 million for 1994. The amounts of translation costs
capitalized for 1995 and 1994 were $2.7 million and $0.7 million, respectively,
representing 92.4% and 75.9% of gross translation expenditures during those
periods.

General and Administrative. General and administrative expenses increased
11.9% to $5.4 million from $4.8 million in 1994 and represented 7.8% and 9.1%
of total revenues in 1995 and 1994, respectively. This increase was due
primarily to an increase in the provision for bad debts.

Provision for Income Taxes. Income tax expense represented 38.6% and 31.3%
of income before income tax for fiscal years 1995 and 1994, respectively. The
effective tax rate in 1995 exceeded the federal statutory rate largely due to
the impact of state income taxes, partially offset by research and
experimentation credits. The effective tax rate in 1994 was lower than the
federal statutory rate due to research and experimentation credits and the
benefit of net operating losses exceeding the impact of state income taxes.

Quarterly Financial Results

The following table sets forth unaudited statement of operations data for
each of the four quarters in fiscal 1995 and 1996 and the first two quarters in
fiscal 1997 and the percentage of the Company's total revenues represented by
each item for the respective quarter. This unaudited quarterly information has
been prepared on the same basis as the annual information presented elsewhere
herein and, in the Company's opinion, includes all adjustments necessary for a
fair presentation of the information for the quarters presented. The operating
results for any quarter are not necessarily indicative of results for any
future period.

23
<PAGE>

Operating Results:

<TABLE>
<CAPTION>
Quarters Ended
--------------------------------------------
Dec. 31, Mar. 31, June 30, Sept. 30,
1994 1995 1995 1995
(in thousands)
<S> <C> <C> <C> <C>
Revenues:
License ..................... $11,241 $ 8,456 $ 8,739 $14,309
Services ..................... 5,972 6,902 6,564 7,115
-------- --------- --------- --------
Total revenues ............... 17,213 15,358 15,303 21,424
Operating Expenses:
Cost of license revenues ... 1,060 1,043 1,462 2,124
Cost of services revenues ... 1,643 1,770 1,821 2,333
Selling and marketing ...... 5,720 5,456 5,297 8,307
Product development ......... 1,739 1,844 2,078 1,771
General and administrative ... 1,307 1,205 1,143 1,729
-------- --------- --------- --------
Total operating expenses ... 11,469 11,318 11,801 16,264
-------- --------- --------- --------
Operating income ............ 5,744 4,040 3,502 5,160
Income tax expense ............ 2,215 1,558 1,350 1,989
-------- --------- --------- --------
Net income .................. $ 3,529 $ 2,482 $ 2,152 $ 3,171
======== ========= ========= ========

<CAPTION>
Quarters Ended
----------------------------------------------------------------
Dec. 31, Mar. 31, June 30, Sept. 30, Dec. 31, Mar. 31,
1995 1996 1996 1996 1996 1997
<S> <C> <C> <C> <C> <C> <C>
Revenues:
License ..................... $11,449 $ 9,052 $ 9,809 $15,031 $14,277 $11,051
Services ..................... 7,174 8,169 8,319 8,599 9,102 9,735
-------- --------- --------- -------- -------- --------
Total revenues ............... 18,623 17,221 18,128 23,630 23,379 20,786
Operating Expenses:
Cost of license revenues ... 1,681 1,345 1,429 2,458 2,558 1,571
Cost of services revenues ... 2,234 2,339 2,300 2,626 2,583 2,718
Selling and marketing ...... 6,814 6,214 6,321 8,502 8,035 6,799
Product development ......... 1,371 1,751 1,482 1,794 2,488 2,481
General and administrative ... 1,486 726 2,002 1,751 1,922 2,438
-------- --------- --------- -------- -------- --------
Total operating expenses ... 13,586 12,375 13,534 17,131 17,586 16,007
-------- --------- --------- -------- -------- --------
Operating income ............ 5,037 4,846 4,594 6,499 5,793 4,779
Income tax expense ............ 1,939 1,866 1,768 2,503 2,230 1,841
-------- --------- --------- -------- -------- --------
Net income .................. $ 3,098 $ 2,980 $ 2,826 $ 3,996 $ 3,563 $ 2,938
======== ========= ========= ======== ======== ========
</TABLE>

Percentage of Total Revenues:

<TABLE>
<CAPTION>
Quarters Ended
--------------------------------------------
Dec. 31, Mar. 31, June 30, Sept. 30,
1994 1995 1995 1995
<S> <C> <C> <C> <C>
Revenues:
License ..................... 65.3% 55.1% 57.1% 66.8%
Services ..................... 34.7 44.9 42.9 33.2
------ ------ ------ ------
Total revenues ............... 100.0 100.0 100.0 100.0
Operating Expenses:
Cost of license revenues ... 6.2 6.8 9.5 9.9
Cost of services revenues ... 9.5 11.5 11.9 10.9
Selling and marketing ...... 33.2 35.5 34.6 38.8
Product development ......... 10.1 12.0 13.6 8.2
General and administrative ... 7.6 7.9 7.5 8.1
------ ------ ------ ------
Total operating expenses ... 66.6 73.7 77.1 75.9
------ ------ ------ ------
Operating income ............ 33.4 26.3 22.9 24.1
Income tax expense ............ 12.9 10.1 8.8 9.3
------ ------ ------ ------
Net income .................. 20.5% 16.2% 14.1% 14.8%
====== ====== ====== ======

<CAPTION>
Quarters Ended
----------------------------------------------------------------

Dec. 31, Mar. 31, June 30, Sept. 30, Dec. 31, Mar. 31,
1995 1996 1996 1996 1996 1997
<S> <C> <C> <C> <C> <C> <C>
Revenues:
License ..................... 61.5% 52.6% 54.1% 63.6% 61.1% 53.2%
Services ..................... 38.5 47.4 45.9 36.4 38.9 46.8
------ ------ ------ ------ ------ ------
Total revenues ............... 100.0 100.0 100.0 100.0 100.0 100.0
Operating Expenses:
Cost of license revenues ... 9.0 7.8 7.9 10.4 10.9 7.6
Cost of services revenues ... 12.0 13.6 12.7 11.1 11.1 13.1
Selling and marketing ...... 36.6 36.1 34.9 36.0 34.4 32.7
Product development ......... 7.4 10.2 8.2 7.6 10.6 11.9
General and administrative ... 8.0 4.2 11.0 7.4 8.2 11.7
------ ------ ------ ------ ------ ------
Total operating expenses ... 73.0 71.9 74.7 72.5 75.2 77.0
------ ------ ------ ------ ------ ------
Operating income ............ 27.0 28.1 25.3 27.5 24.8 23.0
Income tax expense ............ 10.4 10.8 9.7 10.6 9.5 8.8
------ ------ ------ ------ ------ ------
Net income .................. 16.6% 17.3% 15.6% 16.9% 15.3% 14.2%
====== ====== ====== ====== ====== ======
</TABLE>

The Company's quarterly operating results are affected by a number of
factors including the size and timing of license transactions; the demand for
the Company's products; the proportion of revenues attributable to license fees
versus services fees; the proportion of Solution Partner-developed products
versus internally-developed products licensed; changes in the level of
operating expenses; the potential for delay or deferral of customer purchases
of the Company's software; the timing of the introduction or market acceptance
of new or enhanced products offered by the Company or its competitors; the
ability of the Company's affiliate distribution channel to service additional
sales; the competitive conditions in the industry; and the general economic and
political conditions and other factors affecting capital expenditures by
customers. The purchase of the Company's products and services may involve a
significant commitment of capital and other resources by its customers with the
attendant delays frequently associated with large capital expenditures and
authorization procedures within an organization. Accordingly, the sales cycles
for the Company's products and services are subject to a number of significant
risks over which the Company has little or no control, including customers'
budgetary constraints and internal authorization procedures. License revenues
in any quarter are substantially dependent on orders booked and shipped in that
quarter.

24
<PAGE>

The Company's quarterly operating results are subject to certain seasonal
fluctuations. The Company believes that its first quarter (ending December 31)
revenues generally are positively affected by year-end capital expenditures by
certain customers and by year-end incentives provided by IBM to resellers of
its hardware, which include many of the Company's affiliates. In the Company's
fourth quarter (ending September 30), revenues are positively affected by the
incentives provided pursuant to the Company's sales compensation plans. These
factors historically have resulted in each case in increased license revenues
during such quarters. In addition, the Company's revenues occur predominantly
in the third month of each quarter and tend to be concentrated in the latter
half of that third month. Accordingly, delays in product delivery or in
closings of sales near the end of a quarter could cause quarterly revenues and,
to a greater degree, net income to fall substantially short of anticipated
levels. Net income is affected because the Company establishes its spending
levels on the basis of its expected future gross margins. These seasonal
factors are likely to continue to affect quarter-to-quarter comparisons.

Due to the foregoing factors, it is possible that the Company's operating
results could fail to meet the expectations of securities analysts or
investors. In such event, or in the event that adverse conditions in the
manufacturing or ERP marketplace prevail or are perceived to prevail, the price
of the Company's Common Stock would likely be materially adversely affected.
See "Risk Factors--Variability in Quarterly Operating Results; Seasonality."

Liquidity and Capital Resources

The Company has funded its operations and capital expenditures primarily
through cash generated from operations. Historically, the Company has remitted
its excess cash from operations to Marcam Corporation. During the six months
ended March 31, 1997, the Company transferred net cash of $6.5 million to
Marcam Corporation. During fiscal 1996, 1995 and 1994, the Company transferred
net cash to Marcam Corporation of $15.2 million, $16.5 million and $14.3
million, respectively. As of March 31, 1997, the Company had $0.9 million in
cash and a working capital deficit of $14.0 million.

Cash provided by operations was $9.8 million for the six months ended
March 31, 1997 and $23.3 million, $22.7 million and $20.4 million for fiscal
1996, 1995 and 1994, respectively. During the six months ended March 31, 1997,
working capital changes included an increase in deferred revenue as a result of
growth in services revenues, offset partially by an increase in accounts
receivable. During fiscal 1996, working capital was principally affected by an
increase in deferred revenue as a result of growth in services revenues.

Cash used for investing activities was $2.9 million for the six months
ended March 31, 1997 and $8.0 million, $6.1 million and $5.8 million for fiscal
1996, 1995 and 1994, respectively. During fiscal 1996 and the six months ended
March 31, 1997, the Company used cash for investing activities primarily
related to software development and translation and purchases of property and
equipment.

On July 25, 1997, Marcam Corporation borrowed $64 million in the Debt
Financing. The net proceeds from the Debt Financing were used to make the $39
million cash transfer by Marcam Corporation to Marcam Solutions in connection
with the Distribution and to repay Marcam Corporation's $25 million of 9.82%
Subordinated Notes due 2001 (the "Subordinated Notes"). The prepayment penalty
and accrued interest of approximately $2.4 million on the Subordinated Notes was
paid by Marcam Solutions. The indebtedness incurred in the Debt Financing
currently bears interest at the rate of 9%, is payable on August 4, 1997 and is
secured by liens on substantially all of the Company's assets. This indebtedness
will be repaid in part with the net proceeds from the Offering. See "The
Distribution" and "Use of Proceeds."

The Company is currently negotiating a $30 million senior secured revolving
credit and term loan facility. Under this proposed facility, the Company will
borrow up to $15 million as a term loan and up to $15 million under the
revolving credit facility. The Company intends to use borrowings under this
proposed credit facility to repay any amounts borrowed in the Debt Financing
which are not repaid with the net proceeds from the Offering and for general
corporate purposes, including working capital. The Company's obligations under
the proposed credit facility will be secured by liens on substantially all of
the Company's assets. The principal of the term loan under the proposed credit
facility will be payable in installments beginning on September 30, 1998 and
ending on June 30, 2001, and any revolving credit loans under the proposed
credit facility will mature on June 30, 2000. The proposed facility will provide
for prime and LIBOR based interest rate options. The borrowing availability for
revolving credit loans and the rate of interest will vary depending upon
specified financial ratios. The proposed credit facility will contain covenants
which, among other things, will require that the Company maintain certain
financial ratios and will impose certain limitations or prohibitions on the
Company with respect to the occurrence of indebtedness, liens and capital
leases; the payment of dividends on, and the

25
<PAGE>

redemption or repurchase of, capital stock of the Company; investments and
acquisitions; the merger or consolidation of the Company with any person or
entity; and the disposition of any of the Company's properties or assets. The
Company is also currently negotiating for the borrowing availability under the
proposed senior secured revolving credit and term loan facility to be increased
to $75 million, which would permit the Company to repay the indebtedness
incurred in the Debt Financing, in the event the Offering is not completed by
August 4, 1997. To the extent the proposed credit facility is not consummated on
or before August 4, 1997, the Company will be required to seek alternative
sources of funds to repay the indebtedness incurred in the Debt Financing. There
can be no assurance that the Company will be able to consummate the proposed
credit facility on or before August 4, 1997 or, in the alternative, that
additional financing will be available or available on terms acceptable to the
Company. The Company's failure to repay or refinance the indebtedness incurred
in the Debt Financing would have a material adverse effect on the financial
condition of the Company.

In connection with the Debt Financing, Marcam Corporation's $20.0 million
revolving credit facility was terminated on July 25, 1997.

As of March 31, 1997, the Company did not have any material commitments
for capital expenditures. The Company anticipates that its capital requirements
for the last six months of fiscal 1997 will be approximately $1.0 million. The
Company's aggregate minimum lease payments for the remainder of fiscal 1997 are
expected to be $538,000.

The Company believes that the net proceeds from the Offering, together
with cash flows from operations and available borrowings, will be sufficient to
meet the Company's working capital and capital expenditure needs at least until
the end of fiscal year 1998.

Inflation

To date, the Company believes inflation has not had a material impact on
the Company's operations.

Recently Issued Pronouncements

In October 1995, Statement of Financial Accounting Standards No. 123,
"Accounting for Stock-Based Compensation" ("SFAS 123"), was issued which will
require the Company to elect either expense recognition under SFAS 123 or its
disclosure-only alternative for stock-based employee compensation. The expense
recognition provision encouraged by SFAS 123 would require fair-value based
financial accounting to recognize compensation expense for employee stock
compensation plans. The Company has determined that it will elect the
disclosure-only alternative. The Company will be required to disclose the pro
forma net income and pro forma net income per share in the notes to the
combined financial statements using the fair-value based method beginning in
fiscal 1997 after the Distribution, with comparable disclosures for fiscal
1996. The Company has not determined the impact that these pro forma
adjustments will have on its net income or income per share.

In February 1997, Statement of Financial Accounting Standards No. 128,
"Earnings Per Share" ("SFAS 128"), was issued which will require the Company to
present basic and diluted earnings per share ("EPS"). Basic EPS, which replaces
primary EPS, excludes dilution and is computed by dividing income available to
common stockholders by the weighted-average number of common shares outstanding
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 or resulted in the issuance of common stock that then shared
in the earnings of the entity. Diluted EPS is computed similarly to fully
diluted EPS under existing rules. SFAS 128 requires restatement of all prior
period earnings per share data presented. The Company will adopt SFAS 128 as of
October 1, 1998 and has not yet determined the impact of the adoption.

26
<PAGE>

BUSINESS

MAPICS is a leading provider of enterprise resource planning ("ERP")
software applications for mid-size discrete and batch-process manufacturing
enterprises worldwide. The Company's products provide an integrated and
function-rich ERP solution with the breadth and depth of applications to manage
an entire manufacturing enterprise. The MAPICS XA product line currently
consists of 44 integrated application modules in the areas of Engineering and
Cost Management, Market and Demand Management, Plant Operations and Logistics
Management, Production Resource Planning, Financial Management and Measurements
and Cross Applications Solutions. The Company continually enhances its product
offerings to meet the specific needs of mid-size manufacturers and offers such
manufacturers the opportunity to gradually migrate to new technologies, one
user at a time if desired, while protecting their existing investments in both
hardware and software. In addition to its internal development programs, the
Company utilizes third parties (Solution Partners) to assist in the development
of new applications. Solution Partners permit the Company to introduce new
applications quickly and on a variable cost basis.

Approximately 5,700 customer sites presently use MAPICS applications,
which the Company believes represents one of the largest installed user bases
in the ERP industry. In Advanced Manufacturing Research's survey of ERP
customer satisfaction (the "AMR Survey"), MAPICS products received the highest
overall total score (nearly one-third higher than the next competitor) based on
15 different factors, including functionality, value, implementation results,
quality of support, service and maintenance, and knowledge of sales force. The
Company's customer base consists primarily of mid-size ($20 million to $500
million in annual revenues) manufacturers and divisions, sites and subsidiaries
of large companies, including Bristol-Myers Squibb Company, Colgate-Palmolive
Company, Eaton Corporation, General Electric Company, Honda Motor Co., Ltd.,
International Game Technology, Peg Perego Pines SPA, Shiseido Cosmetics
(America) Ltd. and Sub-Zero Freezer Co., Inc. The primary channel for selling
and supporting MAPICS products is a network of more than 80 affiliates which
sells, implements, services and supports MAPICS products throughout the world.
In addition to providing customers high quality local implementation,
consulting and support services in a cost-effective manner, the affiliate
distribution channel provides the Company an attractive variable cost structure
for sales and marketing.

The MAPICS XA product line runs on International Business Machine
Corporation's ("IBM") A/S 400 system, which the Company believes is the leading
platform in the mid-size manufacturing market. The Company intends to pursue
growth opportunities in the ERP market by leveraging its large installed
customer base, continuing to utilize its well-established affiliate
distribution channel, accelerating its growth in international markets,
broadening its customer base with new functionality and continuing its
evolutionary product development approach, designed to migrate customers to new
technologies gradually.

Industry Background

Manufacturers face increasingly intense global competitive pressures, more
demanding vendor-customer relationships and rapidly changing market
requirements. Intensifying global competition requires immediate and effective
communication with customers and suppliers of both discrete and batch-process
manufacturers. Discrete manufacturers produce products by assembling or
machining component parts or sub-assemblies into finished products.
Batch-process manufacturers typically produce a specific quantity of products
on an order or "batch" basis in which a batch moves through a series of
operations in discontinuous mode with work-in-process often building up at
process points (e.g., pharmaceutical and computer chip manufacturers). In
contrast, continuous process manufacturers typically produce products at a
specified rate (e.g., 12 tons per day for 30 days) in which material moves
through various process steps in a continuous flow with no work-in-process
building up at any process point (e.g., chemical, food processing and paper
manufacturers). Customers of discrete and batch-process manufacturers
increasingly demand products which meet custom ("make-to-order") requirements.
These manufacturers are also utilizing new manufacturing methods such as
rate-based manufacturing and just-in-time inventory replenishment. In addition,
manufacturers are increasingly required to manage broadening product
portfolios, multinational distribution, reduced product development and
delivery cycles, lower inventory levels, and more complex manufacturing
strategies. These requirements often involve global sourcing and assembly from
a network of internal and outsourced manufacturers and suppliers. These
challenges require more streamlined organizations, more efficient business
processes, more effective information flow and communication, and a seamless
integration of the entire extended enterprise.

27
<PAGE>

Effective information technology systems, capable of generating and
disseminating critical information throughout an organization and its extended
enterprise, can be a strategic resource for pursuing competitive advantage,
allowing an organization to respond more rapidly to changing market and
customer needs. Organizations rely on ERP systems to manage and integrate
resources across the enterprise including component procurement, inventory
management, manufacturing control, sales management, distribution,
transportation, finance and other functions. The emergence of new computer and
communications technologies, the requirements for addressing Year 2000 system
issues and new developments in electronic commerce are creating demand for a
new generation of ERP applications that offer solutions with expanded
functionality which can be implemented faster, with less risk and lower cost
and which are designed to accommodate future changes to the manufacturing
processes.

Mid-size manufacturers, consisting of independent companies and divisions,
sites and subsidiaries of larger companies with annual revenues of between $20
million and $500 million, are focused on balancing their needs for
functionality from their ERP systems against budgetary constraints. The IBM
AS/400 system, which the Company believes is the leading platform used by
mid-size manufacturers, is increasingly being used as a server for
client/server networks and offers an attractive platform alternative for many
companies implementing ERP solutions because of its low cost of ownership,
flexibility, scalability and maintainability. According to industry sources,
the total worldwide market for ERP systems on all hardware systems was
approximately $5.5 billion in 1996 and will grow at least 20% this year. IBM
has reported that more than 425,000 AS/400 systems have been shipped since
1988. In addition, according to industry sources, more than 60,000 IBM AS/400
systems were shipped during 1996.

In order to compete effectively in their market today and in the future,
mid-size manufacturers require the benefits of client/server ERP solutions that
are affordable and can be implemented quickly, with minimal disruption to
business, and that can be maintained with a limited information technology
staff. ERP systems must provide sufficient depth of functionality and
flexibility to enable manufacturers to respond to varying customer needs and
must offer scalability for growth in operations. Mid-size manufacturers prefer
fully integrated ERP solutions covering all aspects of managing the business
enterprise as opposed to specialized solutions which are costly to integrate
and maintain and are difficult to synchronize when changes are made in software
solutions developed by multiple vendors.

The MAPICS Solution

The Company is a leading provider of ERP software applications for
mid-size discrete and batch-process manufacturing enterprises worldwide. The
Company's approach to addressing this market includes the following:

Integrated Product Line With Broad And Deep Functionality. The MAPICS XA
product line currently consists of 44 integrated application modules which
offer the breadth and depth of functions required to manage a complex
manufacturing enterprise. The MAPICS products, initial versions of which were
introduced over 19 years ago, reflect the Company's comprehensive understanding
of manufacturing processes across a wide range of industries worldwide. The
Company offers a suite of fully integrated application modules which has
expanded from the original 19 modules (many of which have been substantially
enhanced and rewritten) to 44 over the past three years. These new modules and
product enhancements were developed in response to emerging customer needs and
include, among others, Intersite Logistics, Material Requirements Planning,
Customer Order Management, International Financial Management and Electronic
Commerce. Additionally, all of the current versions of MAPICS products are Year
2000 compliant.

Customers Able to Migrate to New Technologies Gradually. The Company
continually enhances its product offerings to meet the specific needs of
customers and offers customers the opportunity to gradually migrate to new
technologies, one user at a time if desired, while protecting their existing
investments in both hardware and software. As new features and functions are
added, all existing functionality is preserved. MAPICS XA utilizes the
technology often sought by manufacturers, such as client/server computing,
object-oriented technology and data warehousing.

Local Implementation and Support Services. MAPICS users throughout the
world benefit from the implementation and other support services provided by
the Company's more than 80 local distribution affiliates. These affiliates
offer customers experienced local contact to implement and customize MAPICS
products rapidly and cost-effectively and also offer customers the necessary
level of support to permit them to maintain limited information technology
staffs. These affiliates are also able to customize applications for customers.
The Company has consolidated its distribution channel, reducing significantly
the number of affiliates in place at the time the

28
<PAGE>

business was acquired in 1993, retaining its current affiliates because of
their ability to sell and market MAPICS products, product knowledge, quality of
customer support, implementation capacity and financial stability.

High Quality Product Support. The Company is dedicated to providing high
quality support for its products both directly through its approximately 90
employee support staff and through its affiliates. The Company's development
laboratory and the primary customer support center were among the first in the
ERP packaged software industry to be ISO 9001 registered, and they remain among
the few which have achieved this status. In the AMR Survey, MAPICS products
received the highest overall total score (nearly one-third higher than the next
competitor) based on 15 different factors, including functionality, value,
implementation results, quality of support, service and maintenance, and
knowledge of sales force.

Strategy

The Company's primary objective is to continue to be a leading provider of
integrated ERP solutions to mid-size manufacturers worldwide. The key elements
to implement this strategy are:

Utilize Well-Established Affiliate Distribution Channel. MAPICS products
are distributed in over 50 countries through a network of more than 80
affiliates. The use of local affiliates provides the Company with strong market
access and penetration, while providing for local support. With their extensive
experience installing MAPICS products, these affiliates typically offer
customers high quality and cost-effective local implementation, consulting and
support services and, in some cases, offer complementary products. Affiliates
typically have extensive knowledge of the mid-size manufacturing industry in
their geographic region and are able to establish and maintain cooperative
relationships with MAPICS customers. While these activities generate
significant revenues for the affiliates, the affiliate distribution channel
provides the Company with an attractive variable cost structure for sales and
marketing. The Company continues to enhance its affiliate distribution channel
by providing new training programs, assisting in affiliate recruiting efforts
and improving communications with its affiliates.

Accelerate Growth in International Markets. The Company intends to
continue to expand its market presence throughout the world, with a focus on
Europe where there is a large installed base of AS/400 systems. During 1996,
the Company introduced its International Financial Management suite of modules,
which are designed to meet the requirements of international enterprises with
customers and production facilities in multiple countries. To address specific
needs in local markets, MAPICS modules are translated and localized, supporting
the local language, currency, taxation and accounting requirements. Currently,
the most commonly installed MAPICS XA application modules are available in
English, Chinese, French, German, Japanese, Portuguese and Spanish.

Migrate Customers to New Technologies Gradually. The Company is committed
to enhancing the functionality of its products and delivering solutions which
utilize new technologies sought by users, while preserving users' previous
investments in both hardware and software. This evolutionary product
development strategy is designed to offer customers the opportunity to migrate
to new technologies at their own pace, as gradually as one user at a time if
desired. The Company believes this approach is attractive to those mid-size
manufacturers who seek functional applications which operate on established
hardware platforms. Product development priorities are determined by insight
and input from the Company's customers, Solution Partners and affiliates. Also,
the Company will continue to work with Solution Partners, which enables the
Company to offer functionality to meet specific customer needs.

29
<PAGE>

Products

The MAPICS I application system, the first comprehensive manufacturing
resource planning system, was introduced in 1978 by IBM. In 1984, IBM
introduced the enhanced MAPICS II application, which was designed to run on
IBM's System 36 and 38 computers. In 1989, IBM introduced MAPICS/DB to run on
IBM's AS/400 system. In 1993, the Company acquired the exclusive marketing
rights to the MAPICS product line and retained approximately 150 former IBM
employees to continue the development and support of the MAPICS products.

Following the acquisition, the Company undertook to improve the overall
functionality of the MAPICS products and in 1994 MAPICS eXtended Advantage (XA)
was introduced by the Company. Overall, since the acquisition of the marketing
rights in 1993, the Company has expanded the number of software modules from 19
to 44, and has substantially enhanced and rewritten many of the original
modules.

The Company's principal software product line, MAPICS XA, which runs on
the IBM AS/400 system, provides a comprehensive and integrated ERP solution for
mid-size manufacturing enterprises. The MAPICS XA product line has been
designed to support, within a single site or multiple sites, varied production
and operational processes. The MAPICS products provide the flexibility to
expand to additional sites and processes as a manufacturer's business evolves.
The MAPICS XA product line consists of application modules, which can be
combined and integrated to meet the evolving and specific needs of the
Company's customers.

The Company's MAPICS XA software application modules integrate
feature-rich applications in the following key application areas:

Engineering and Cost Management Applications assist in the development of
data which describe the materials, processes and facilities required to
estimate costs and produce manufactured items. The Company's four software
modules in this area include:

Product Data Management Engineering Data Management
PDMPlus Estimating and Quote Management

Market and Demand Management Applications provide for the configuration
and entry of customer orders and the control of these orders through pricing,
picking, shipping and invoicing. Also included is the analysis of the demand
sources (e.g., customers, sales territories and geographies) of all orders. The
Company's four software modules in this area include:

Customer Order Management Market Monitoring and Analysis
Sales Analysis Knowledge-Based Configurator

Plant Operations and Logistics Management Applications support the
procurement and tracking of material, the launch and control of manufacturing
activity, and the management of plant maintenance. The Company's 14 software
modules in this area include:

Inventory Management Approvals
Repetitive Production Management Entity Management
Intersite Logistics-Single Site Preventive Maintenance
Intersite Logistics-Multiple Site Work Order Management
Purchasing MRO Inventory
Production Control and Costing Maintenance Imaging
Production Monitoring and Control Maintenance EIS

Production Resource Planning Applications project the demand for
materials, personnel and equipment based on forecasts and assist in preparing
the master schedule to produce items ordered by customers. The Company's five
software modules in this area include:

Forecasting Master Production Schedule Planning
Material Requirements Planning Capacity Requirements Planning
Finite Capacity Planning and Scheduling

30
<PAGE>

Financial Management and Measurements Applications provide financial and
managerial accounting functions and tracks historical performance of key
management measurements and contracts. The Company's 12 software modules in
this area include:

International Financial Management Accounting Management
Accounts Payabale Accounts Payable
Accounts Receivable Accounts Receivable
General Ledger Financial Analysis
Contract Accounting General Ledger
Executive Information System Fixed Assets
Manufacturing Performance Analysis Payroll USA

Cross Applications Solution Applications provide common services (e.g.,
security control, data retrieval, report development, data transmission) for
all application modules. The Company's five software modules in this area
include:

Cross Application Support Electronic Commerce
PowerVision Visual WorkPlace
Information WorkPlace

The MAPICS XA product line is compatible with the needs of mid-size
manufacturers throughout the world. The Company's most commonly purchased
products have been translated into at least six languages, support local
currency transactions and can be implemented and utilized in multisite,
multinational divisions of large, diverse enterprises.

When it first licenses its software, the Company receives both an initial
license fee and a periodic license fee. The periodic license fee, which is
typically paid annually in advance thereafter, entitles the customer to
continue using the software and to receive certain support services. If a
customer does not renew its periodic license, it is no longer entitled to use
the Company's software. The typical initial license fee for a new MAPICS system
ranges between $100,000 and $600,000, depending upon the number and type of
modules licensed, the size of the processor and in some instances the number of
users. The typical periodic license fee is based on a percentage of the then
current amount of the applicable initial license fee.

The MAPICS XA product line offers a Graphical User Interface (GUI), which
allows the user to choose between the lower cost character-based screens or a
Microsoft Windows-based look and feel. The MAPICS products have been converted
to be Year 2000 compliant and are offered to MAPICS customers who are paying
periodic license fees.

Product Development

Since the Company acquired the exclusive marketing rights to the MAPICS
products from IBM in 1993, it has released a number of new products and product
enhancements to the MAPICS/DB and MAPICS XA product lines. Ongoing product
development efforts are focused on addressing the needs of its customer base,
in part as a result of feedback from its local affiliates, and on further
broadening and deepening the functionality of MAPICS products. In particular,
research is currently being conducted by the Company to make MAPICS products
available in a JAVA development environment which can be ported to run on
multiple platforms, including the IBM AS/400 and those running Microsoft's NT
Server. To date, the Company has developed a prototype product that runs its
PDMPlus application on Microsoft's NT server platforms. The Company intends to
employ the technology underlying the prototype product to duplicate the MAPICS
applications on Microsoft's NT server platforms. These research efforts have
been undertaken so that the Company may, in the future, offer its customers a
choice of platforms on which to run MAPICS products. Development direction is
established by senior management with guidance from the marketing staff and
affiliates. The development team is responsible for design and design
verification, coding, quality assurance, documentation, and language conversion
of new enhancements, products and releases. The Company's development lab,
located in Atlanta, Georgia, is certified for compliance with ISO 9001. See
"Risk Factors--New Products and Technological Change."

In addition to internal development efforts, the Company has, to date,
developed 19 of the Company's software modules in collaboration with third
parties, termed "Solution Partners." Solution Partners are generally expected

31
<PAGE>

to maintain development quality and procedures commensurate with those utilized
in the Company's internal development lab. As a result of working closely with
its Solution Partners, the Company believes that most of its software modules
attain consistent quality, implementation and support standards, and that most
modules developed by Solution Partners are virtually indistinguishable from
those developed by the Company's internal development team. The Solution
Partners are generally paid royalties by the Company when the Company receives
its license fees for Solution Partner-developed modules.

Research and development expenditures have increased significantly in
recent periods as the Company has continued to focus on development of new and
enhanced products. During fiscal years 1994, 1995, and 1996, gross research and
product development expenditures were $11.5 million, $12.9 million, and $12.8
million, respectively. See "Management's Discussion and Analysis of Financial
Condition and Results of Operations" and "Risk Factors--Dependence on External
Development Resources."

Customers

The Company believes that MAPICS products have been licensed to more
customer sites worldwide than any other ERP software solution in the industry
with an installed user base of approximately 5,700 customer sites. The
Company's primary customers are mid-size discrete and batch-process
manufacturers, consisting of independent companies and divisions, sites and
subsidiaries of larger companies with annual revenues of between $20 million
and $500 million. Discrete mid-size manufacturers generally seek software
solutions that will address and help manage product specifications, customer
demand, inventory availability, labor and equipment resources and advanced
manufacturing techniques which require just-in-time inventory replenishment.
The Company believes that it meets the practical business requirements of
mid-size manufacturers by offering modular technology choices which can be
implemented gradually and which are fully supported by local service providers.
The Company's products assist customers in meeting their internal goals of
maintaining operational flexibility, responding to market changes, increasing
revenue and market share, and minimizing cost, waste and disruption.

None of the Company's customers accounted for more than 10% of total
revenues in fiscal 1996. The Company does not believe that its backlog at any
particular point in time is indicative of future sales.

The Company's installed base includes divisions, sites and subsidiaries of
the following enterprises:

<TABLE>
<S> <C>
ABB Asea Brown Boveri (Holding) Ltd. Kerry Ingredients UK Ltd.
Bayer Corporation Matsushita Electronic Industrial Co., Ltd.
Bostick, Inc. Michelin Corporation
Bristol-Myers Squibb Company Michigan Bulb Company Inc.
Colgate-Palmolive Company MTD Products, Inc.
Coltec Industries Inc. Pall Corporation
Cooper Industries Peg Perego Pines SPA
Eaton Corporation Philips Electronics N.V.
Emerson Electric Co. Shiseido Cosmetics (America) Ltd.
Figgie International, Inc. Sub-Zero Freezer Co., Inc.
Gencor Ltd. Syntex Corp.
General Electric Company, P.L.C. Thomas Lighting Inc.
Giddings and Lewis, Inc. Volvo Corporation
Goodyear Tire & Rubber Company Westinghouse Electric Corporation
Honda Motor Co., Ltd. York International
International Game Technology
</TABLE>

Marketing and Sales

The Company markets its products through a network of more than 80
affiliates in over 50 countries throughout North America, Europe, Africa, the
Middle East, the Asia Pacific region, and Latin America, which implements,
services and supports the Company's products throughout the world. The use of
local affiliates provides the Company with strong market access and
penetration. Affiliates provide sales, consulting, implementation and
maintenance services directly to the Company's customer base on a local basis.
Typically, the affiliates have extensive experience in installing MAPICS
products and provide high quality, knowledgeable consulting and

32
<PAGE>

support services to MAPICS customers. Affiliates tend to have extensive
knowledge of the mid-size manufacturing industry in their geographic region and
are able to establish and maintain cooperative relationships with MAPICS
customers. The Company does not own any interest in any of its distribution
affiliates. Each affiliate has the right to market and sell MAPICS products
within a specific geographic territory and in return, affiliates are generally
not permitted to represent other, competitive, ERP systems. The affiliates are
managed by a sales management team which has emphasized consolidation of
smaller affiliates into larger organizations, eliminated overlapping
territories, and developed a higher level of sales skills.

The affiliate distribution channel provides significant leverage to the
Company. Most importantly, the affiliates provide a variable cost channel since
they generally receive a sales commission when the Company receives its license
fees. Moreover, the affiliate channel provides the Company continual input and
feedback regarding customer concerns and requirements, industry trends and
competitive products, thus enabling the Company to respond to and anticipate
the future product needs of its customer base and to incorporate such knowledge
into its product development efforts.

The Company historically has had excellent relations with its affiliates.
These strong relations are, the Company believes, attributable to a number of
factors, including the significant revenues which the affiliates receive both
directly from MAPICS as well as from consulting and customization services
rendered to users of MAPICS products and from IBM for sales of the AS/400. In
addition, the affiliates have generally made significant investments in
developing MAPICS knowledge within their organizations.

Customer Support and Service

The Company believes that providing a high level of customer service and
technical support is necessary to achieve rapid product implementation which,
in turn, is essential to long-term customer satisfaction and continued revenue
growth. Accordingly, MAPICS is committed to maintaining a high-quality,
knowledgeable affiliate channel supported by the Company's internal service and
support staff. MAPICS' customer service and support activities can be grouped
into two key areas, as follows:

Implementation consulting, education and applications integration
services. These services are provided on a project consulting basis by the
Company's affiliates. Implementation consulting services are provided on-site
to assist customers in the installation and use of the Company's products
whether entire systems are implemented or individual modules are installed to
augment existing applications. The Company also provides its customers with
supplemental materials which guide the customer through the installation
process thus increasing the efficiency of installation and reducing the cost.
The Company has developed and provides educational materials and instructions
which are used by affiliates in customer classroom environments.

Installed product maintenance. The Company maintains a central telephone
response and assistance program. In North America, this program is available to
customers that pay periodic license fees, 24 hours a day, seven days a week.
Customers receive assistance in operational issues and resolving possible code
errors. A standardized telephone support management system is used by all
support centers to log telephone calls, trace problems or inquiries, identify
qualified support personnel to assist customers, follow the inquiry through to
a successful resolution and measure support performance. In the AMR Survey,
telephone support for the MAPICS products was rated the highest in the
industry.

The Company presently maintains three support centers: Atlanta, Georgia,
which serves North and South America; Eindhoven, Netherlands, which services
Europe, the Middle East and Africa; and Kuala Lumpur, Malaysia which services
the Asia Pacific region.

Proprietary Rights and Technology

The Company's success and ability to compete is heavily dependent upon its
proprietary technology, including its software source code. To protect its
proprietary technology, the Company relies on a combination of copyright,
trademark and trade secret laws and license and non-disclosure agreements,
which may afford only limited protection. In addition, effective copyright
protection may be unavailable or limited in certain foreign countries. Although
the Company relies on the limited protection afforded by such intellectual
property laws, it also believes that factors such as the technological and
creative skills of its personnel, new product developments, frequent product
enhancements, name recognition and reliable customer support are also essential
to establishing and maintaining a technology leadership position. The Company
presently has no patents or patent applications pending.

33
<PAGE>

The source code for the Company's proprietary software is protected both as a
copyrighted work and certain of the applications are protected as trade
secrets. The Company generally enters into confidentiality or license
agreements with its employees, consultants, distributors and customers, and
generally controls access to and distribution of its software, documentation
and other proprietary information. The Company is reliant, however, upon
certain of its Solution Partners to continue to allow the Company to use
technologies developed by such Solution Partners on terms that are favorable to
the Company.

Despite the measures taken by the Company to protect its proprietary
rights, unauthorized parties may attempt to reverse engineer or copy aspects of
the Company's products or to obtain and use information that the Company
regards as proprietary. Policing unauthorized use of the Company's products is
difficult. Litigation may be necessary in the future to enforce the Company's
intellectual property rights, to protect the Company's trade secrets, to
determine the validity and scope of the proprietary rights of others, or to
defend against claims of infringement or invalidity. Such litigation could
result in substantial costs and diversion of resources and could have a
material adverse effect on the Company's business, operating results and
financial condition. In addition, to the extent the Company desires or is
required to obtain licenses to proprietary rights of others, there can be no
assurance that any such licenses will be made available on terms acceptable to
the Company, if at all. Any litigation or dispute regarding proprietary
technology which results in a ruling or settlement that is adverse to the
Company, could have a material adverse effect on the Company's business
operating results and financial condition. Claims against the Company, with or
without merit, as well as claims initiated by the Company against third
parties, can be time consuming and expensive to defend, prosecute or resolve.
See "Risk Factors--Uncertain Protection of Proprietary Technology."

Competition

The market for ERP software within the mid-size manufacturing industry is
highly competitive, changes rapidly and is to a significant degree affected by
new product introductions and other market activities of industry participants.
The Company's products and related services are primarily targeted at the
market for business applications software for use with the IBM AS/400. The
Company's current and prospective competitors offer a variety of products which
address this and similar markets. The Company's primary competition comes from
a large number of independent software vendors and other sources, including
Baan N.V., Computer Associates, Inc., Intentia AB, JBA Holdings Plc, J.D.
Edwards and Company, Inc., Oracle Corporation, SAP AG and System Software
Associates, Inc. Of the Company's primary competitors, the products of Intentia
are currently designed solely for use with the IBM AS/400, and the products of
JBA Holdings Plc, J.D. Edwards and System Software Associates are currently
designed for use primarily with the IBM AS/400. The Company also experiences
some competition from vendors of specialized applications. See "Risk Factors--
Competition."

The principal competitive factors in the market for ERP software and
services include product functionality, quality, performance, reliability,
ease-of-use, cost-effectiveness, size of installed base, technology, service,
and vendor reputation and financial stability. The Company believes that its
products currently compete favorably on the foregoing bases, although in
certain instances it may be at a competitive disadvantage against companies
with greater financial, marketing, service, support, and technological
resources, and greater name recognition. The Company believes its competitive
strengths include its extensive mid-size manufacturing industry expertise, its
dedicated affiliate channel, broad and deep functionality of its products and
proven customer satisfaction.

In order to be successful in the future, the Company must continue to
respond promptly and effectively to the challenges of technological change and
its competitors' innovations by continually enhancing its own product
offerings. There can be no assurance, however, that the Company's products will
continue to compete favorably or that the Company will be successful in the
face of increasing competition from new products and enhancements introduced by
existing competitors or by new companies entering this market. In addition,
because the Company often relies on third party affiliates for implementation
and other support of its products, there can be no assurance that these
affiliates will maintain high quality standards sufficient to maintain the
reputation and competitive position of the Company. The Company must continue
to respond effectively to customer needs and properly select and incorporate
those technologies and application functionalities that will meet the
challenges posed by competitors' innovations. To accomplish these critical
objectives, the Company must continue to invest in enhancing its current
products and introduce new products to remain competitive. See "Risk
Factors--New Products and Technological Change."

34
<PAGE>

Employees

As of April 30, 1997, the Company employed a total of 234 employees. None
of the Company's employees is represented by a labor union. The Company has
experienced no work stoppages and believes that its employee relations are
good.

The Company's future operating results depend in significant part upon the
continued service of its key technical and senior management personnel. The
Company's future success also depends on its continuing ability to attract and
retain highly qualified technical and managerial personnel. Competition for
such personnel is intense, and may further intensify due to the hiring needs of
numerous competitors to particularly address Year 2000 issues. There can be no
assurance that the Company will retain its key managerial or technical
personnel or attract such personnel in the future. The Company has at times
experienced and continues to experience difficulty recruiting qualified
personnel and there can be no assurance that the Company will not continue to
experience such difficulties in the future. The Company, either directly or
through personnel search firms, actively recruits qualified product
development, consulting and sales and marketing personnel. If the Company is
unable to hire and retain qualified personnel in the future, such inability
could have a material adverse effect on the Company's business, financial
condition and results of operations.

Facilities

The Company's principal administrative, marketing, product development and
support facilities are located in Atlanta, Georgia, where the Company leases a
total of approximately 60,000 square feet under two agreements that expire in
March 1998 and in 1999. The Company has other leases in place for its North
American, Latin American, European and Asian Pacific sales and service offices.
The Company believes that its facilities are adequate for its current needs.

Marcam Corporation's principal administrative, marketing and product
development and support facilities are located in Newton, Massachusetts. In
connection with the Distribution, Marcam Corporation has assigned its lease for
the premises in Newton, Massachusetts (approximately 94,000 square feet) to
Marcam Solutions. This lease expires in 1999. Marcam Corporation has also
assigned the leases for certain of the Atlanta facilities as well as the Saddle
Brook, New Jersey, Oakbrook Terrace, Illinois, and Irvine, California locations
to Marcam Solutions. The remaining facilities will not be affected by the
Distribution.

Legal Proceedings

The Company is subject to legal proceedings and claims which arise in the
normal course of business. While the outcome of these matters cannot be
predicted with certainty, management does not believe the outcome of any of
these legal matters will have a material adverse effect on the Company's
business, financial condition or results of operations.

35
<PAGE>

MANAGEMENT

Executive Officers and Directors

After the Offering and in connection with the Distribution, it is expected
that all current directors of the Company other than William E. Ford and Edward
J. Kfoury will resign and that Messrs. Ford and Kfoury will fill the vacancies
so created with the other individuals identified as directors below. In
addition, it is expected that all current executive officers of the Company
other than Richard C. Cook will be replaced with the individuals identified as
executive officers below.

Name Age Position
- ------------------------------------- ----- ------------------------------------------------------
<S> <C> <C>
Richard C. Cook ..................... 50 President, Chief Executive Officer and Director
William J. Gilmour .................. 41 Chief Financial Officer and Vice President of Finance
Thomas F. Aery ..................... 51 Vice President of Worldwide Customer Support
George A. Chamberlain, 3d (2) ...... 61 Director
Edward J. Kfoury (1)(2) ............ 59 Director
William E. Ford (1)(2) ............ 36 Director
</TABLE>

- ------------
(1) Member of Compensation Committee.
(2) Member of Audit Committee.

Mr. Cook will serve as the Company's President and Chief Executive Officer
immediately following the Offering. Since July 1996, Mr. Cook served as Marcam
Corporation's Senior Vice President and General Manager, MAPICS Business Group.
From October 1994 to July 1996, he served as Marcam Corporation's Vice
President and General Manager, MAPICS Business Group. Mr. Cook served as the
President, Chief Executive Officer and Chairman of the Board of Mapics, Inc.
from October 1992 to September 1994. Mr. Cook was employed by International
Business Machines Corporation ("IBM") as Director of its Atlanta Software
Development Lab from March 1990 to September 1992 and as Director of its
Corporate CIM (Computer Integrated Manufacturing) Project Office from March
1988 to April 1990.

Mr. Gilmour will serve as the Company's Chief Financial Officer and Vice
President of Finance immediately following the Offering. Since October 1994,
Mr. Gilmour served as Controller of Marcam Corporation's MAPICS Buisiness
Group. From January 1993 to September 1994, Mr. Gilmour served as Controller of
Mapics, Inc. From November 1991 to January 1993, Mr. Gilmour served as
Controller of Marcam Canada Corporation, an indirect subsidiary of Marcam
Corporation. Prior to joining Marcam Corporation, Mr. Gilmour served as
Corporate Controller of Madison Chemical Industries, a specialty chemical
manufacturer. Mr. Gilmour obtained his Chartered Accountant designation from
the Canadian Institute of Chartered Accountants in 1980.

Mr. Aery will serve as the Company's Vice President of Worldwide Customer
Support immediately following the Offering. Since October 1994, he has served
as Marcam Corporation's Vice President of Worldwide Customer Support, MAPICS
Business Group. From May 1993 to September 1994, Mr. Aery served as Director of
Worldwide Customer Support of Mapics, Inc. Prior to joining Marcam Corporation,
Mr. Aery was employed by IBM as Worldwide Product Manager, MAPICS.

Mr. Chamberlain will become a director of the Company immediately
following the Offering. Mr. Chamberlain will serve as Marcam Solutions' Chief
Financial Officer and Vice President of Finance after the Distribution. Mr.
Chamberlain has served as Marcam Corporation's Chief Financial Officer since
September 1994. Prior to joining Marcam Corporation, Mr. Chamberlain was an
Executive Vice President with Capital Technologies, Inc., a consulting and
venture capital company, during 1993 and 1994. Mr. Chamberlain retired from
Digital Equipment Corporation in 1992, where he had most recently been Vice
President of Finance.

Mr. Kfoury has been a director of Marcam Corporation since May 10, 1993
and will continue to be a director of the Company. He was initially appointed
to the Board of Directors of Marcam Corporation as a designee of IBM, a
stockholder of Marcam Corporation, pursuant to agreements between IBM and
Marcam Corporation and among IBM, Marcam Corporation, Paul A. Margolis and John
Campbell. Mr. Kfoury is no longer a designee of IBM. Mr. Kfoury served as a
division President and as a Vice President of IBM until June 1, 1993, the
effective date of his retirement.

36
<PAGE>

Mr. Ford has been a director of Marcam Corporation since October 1995 and
will continue to be a director of the Company. He was appointed to the Board of
Directors as a designee of General Atlantic Partners 21, L.P., ("GAP 21"), a
stockholder of Marcam Corporation, pursuant to the Convertible Preferred Stock
Purchase Agreement dated as of September 20, 1995 by and among Marcam
Corporation, GAP 21, GAP Coinvestment Partners, L.P. and The Northwestern
Mutual Life Insurance Company. Mr. Ford has been a managing member of General
Atlantic Partners, LLC since 1991. Prior to 1991, Mr. Ford was a Senior
Associate with Morgan Stanley. Mr. Ford is also a director of GT Interactive
Software Corp., Envoy Corporation, SS&C Technologies, Inc. and E*Trade Group,
Inc.

Pursuant to the Company's Restated Articles of Organization, the Company's
Board of Directors is divided into three classes. Each director is elected for
a three-year term of office, with one class of directors being elected at each
annual meeting of stockholders. Each director holds office until his successor
is elected and qualified or until his earlier death, resignation or removal.
Mr. Kfoury will serve in class I whose term expires in 1998; Messrs.
Chamberlain and Cook will serve in class II whose term expires in 1999; and Mr.
Ford will serve in class III whose term expires in 2000.

Executive Compensation

Prior to the Distribution, the executive officers of the Company will have
been paid compensation and provided benefits by Marcam Corporation.
Compensation paid or benefits provided by Marcam Corporation and its
subsidiaries during Marcam Corporation's last fiscal year to the chief
executive officer of the Company and the two other most highly compensated
executive officers of the Company whose annual compensation and bonus was
$100,000 or more is as follows: Mr. Cook received a base salary of $162,437, a
bonus of $189,801 and a contribution to Marcam Corporation's group life
insurance policy and 401(k) Plan of $3,018. Mr. Cook did not receive any stock
option grants during fiscal 1996. Mr. Aery received a base salary of $99,875, a
bonus of $41,055 and a contribution to Marcam Corporation's group life
insurance policy and 401(k) Plan of $1,906. Mr. Aery received options to
purchase 5,000 shares of Common Stock during fiscal 1996. Mr. Gilmour received
a base salary of $78,678, a bonus of $23,954 and a contribution to Marcam
Corporation's group life insurance policy and 401(k) Plan of $1,665. Mr.
Gilmour received options to purchase 1,000 shares of Common Stock during fiscal
1996. Marcam Corporation did not grant any stock appreciation rights during
fiscal 1996. No other executive officer of the Company who held office during
fiscal 1996 met the definition of "highly compensated" within the meaning of
the Securities and Exchange Commission's executive compensation disclosure
rules.

After the Distribution, the Company intends to increase the base salaries
for its executive officers to levels commensurate with salary levels of
software companies with similar historical revenues. In addition, the Company
expects to implement new executive incentive compensation and stock option
arrangements similar to those currently maintained by software companies with
similar historical revenues. Accordingly, the historical compensation
information for Messrs. Cook, Aery and Gilmour is of limited relevance.

THE DISTRIBUTION

In connection with the Distribution, Marcam Corporation has transferred to
Marcam Solutions, substantially all of the business, assets and liabilities
relating to its PRISM, Protean and Avantis product lines and an aggregate of
$39.0 million in cash in exchange for (i) a number of shares of common stock of
Marcam Solutions sufficient for Marcam Corporation to make the Distribution and
(ii) warrants to purchase an aggregate of 500,000 shares of common stock of
Marcam Solutions (the "Marcam Solutions Warrants"). The $39 million cash
transfer by Marcam Corporation to Marcam Solutions was financed with a portion
of the net proceeds from the Debt Financing. See "Summary--Recent Developments"
and "Management's Discussion and Analysis of Financial Condition and Results of
Operations--Liquidity and Capital Resources."

Marcam Corporation distributed all of its ownership interest in Marcam
Solutions (the "Distribution") by means of a distribution on July 29, 1997 to
its stockholders of record on July 23, 1997. Marcam Corporation

37
<PAGE>

has received a private letter ruling (the "Private Letter Ruling") from the
Internal Revenue Service (the "Service") substantially to the effect that,
except as provided below, the Distribution will qualify as a tax-free
distribution to the Company and its stockholders under the Code. Accordingly,
for federal income tax purposes, neither the Company nor its stockholders should
recognize taxable gain on the Distribution, except as provided below. The
Company, however, will recognize gain on the Distribution to the extent that
Marcam Solutions shares are received by stockholders who are not United States
persons ("non-U.S. persons"). The number of Marcam Solutions shares expected to
be distributed to non-U.S. persons is estimated to represent not more than 19%
of the total Marcam Solutions shares to be distributed in the Distribution.
Moreover, the Company may recognize additional gain with respect to certain
aspects of the Distribution, including certain restructuring transactions
expected to be consummated in connection with the Distribution. The aggregate
amount of gain recognized by the Company in connection with the Distribution is
not expected to result in any significant tax liability, but rather is expected
to be offset by existing net operating losses, to the extent that such net
operating losses are not otherwise subject to limitations under the Code.
Accordingly, the amount of such net operating losses available to the Company
after the Distribution will likely be reduced. In connection with the Asset
Transfers, taxable gain may also be recognized in certain foreign jurisdictions.
Such gain would not generally be offset by existing domestic net operating
losses. The incurrence of significant tax liabilities by the Company, in the
event that the Distribution is not treated as a tax-free transaction, may have a
material adverse effect on the Company's business, financial condition and
results of operations. See "Risk Factors--Federal Income Tax Consequences and
Liabilities."

Marcam Corporation and Marcam Solutions have entered into a Distribution
Agreement together with certain ancillary agreements providing for the
separation of the product lines and governing various ongoing relationships
between the two companies. See "Relationship Between MAPICS and Marcam
Solutions."

The Distribution Agreement provides that promptly following the closing of
the Offering, all directors of Marcam Corporation (other than those directors
who will continue to be directors of the Company) shall resign from the Board
of Directors of Marcam Corporation. The continuing directors will then elect
the new directors to fill the vacancies created by the resignations and the
newly constituted Board of Directors of the Company will appoint the executive
officers of the Company.

After the Distribution, the Company expects to continue to offer a benefit
package to its employees substantially comparable to that currently available
under the plans and programs offered by Marcam Corporation
and also expects that there will be no significant interruption in or loss of
benefits to its employees. These benefits include participation in a 401(k)
plan, medical, dental, disability and life insurance, a Section 125 cafeteria
plan, an employee stock purchase plan and other welfare benefits.

Marcam Solutions is establishing its own welfare benefit plans and programs
which generally will be comparable to those currently offered by the Company.
However, Marcam Solutions may change its plans and programs in the future. In
addition, it is expected that the Company will transfer the assets and
liabilities of the 401(k) plan relating to Marcam Solutions employees and former
employees to a corresponding Marcam Solutions 401(k) plan. See "Relationship
Between MAPICS and Marcam Solutions."

Marcam Corporation currently maintains the following stock plans, each of
which has previously been approved by Marcam Corporation stockholders: The
Marcam Corporation 1987 Stock Plan (the "1987 Plan"), the Marcam Corporation
1991 Non-Employee Director Stock Option Plan (the "Directors Plan") and the
Marcam Corporation 1994 Stock Plan (the "1994 Plan") (collectively, the "Marcam
Plans"). Under the Marcam Plans, as of May 31, 1997, options to purchase an
aggregate of approximately 2,626,132 shares of common stock of Marcam
Corporation (collectively the "Marcam Options") were held by current and former
employees and directors of Marcam Corporation (the "Optionees"). The
Distribution Agreement provides that, in connection with the Distribution, each
holder of a Marcam Option will (i) retain such Marcam Option, which after the
Distribution will be an option to purchase the same number of shares of the
Company's Common Stock (the "Adjusted MAPICS Option"), and (ii) be granted an
option to purchase shares of common stock of Marcam Solutions equal to one-half
of the number of shares of common stock of Marcam Corporation subject to such
Marcam Option (each, a "Marcam Solutions Option"; collectively, the "Adjusted
Options"). Thus, following the Distribution, each Optionee will hold separate
options to purchase shares of the Company's Common Stock and common stock of
Marcam Solutions. The per share exercise price of each Adjusted Option will be
adjusted to give effect to the Distribution by allocating the exercise price of
the corresponding Marcam Option between the Adjusted MAPICS Option and the
Adjusted Marcam Solutions Option, based on the relative fair market values of
the underlying Company Common Stock

38
<PAGE>

and Marcam Solutions common stock after the Distribution so as to preserve
the "spread" value of the existing Marcam Option. For this purpose, the fair
market value of a share of each such Common Stock will be the average of the
closing sales prices per share of each Common Stock on the Nasdaq National
Market for each of the five consecutive trading days beginning on the first day
following the Distribution Date.

Each Adjusted Option will continue to be subject to the same terms and
conditions that applied to the corresponding Marcam Option prior to the
Distribution, except that vesting will be based on service with Marcam
Solutions, the Company or both.

In connection with the Distribution, the warrants to purchase an aggregate
of 383,333 shares of Common Stock of Marcam Corporation issued in connection
with the sale of the Subordinated Notes (the "Sub Debt Warrants") will be
adjusted such that the exercise price will be decreased and the number of
underlying shares will be increased on a basis intended to preserve the spread
value of the Sub Debt Warrants. In addition, the holders of the warrants to
purchase an aggregate of 1,000,000 shares of Common Stock of Marcam Corporation
issued in connection with the sale of Series E Convertible Preferred Stock (the
"GA Warrants") will (i) retain such GA Warrants, which after the Distribution
will be warrants to purchase the same number of shares in the aggregate of the
Company's Common Stock (the "MAPICS GA Warrants") and (ii) receive the Marcam
Solutions Warrants. The current exercise price of the GA Warrants will be
allocated between the MAPICS GA Warrants and the Marcam Solutions Warrants on a
basis intended to preserve the spread value of the existing GA Warrants.

39
<PAGE>

RELATIONSHIP BETWEEN MAPICS AND MARCAM SOLUTIONS

Marcam Corporation and Marcam Solutions have entered into the Distribution
Agreement. Pursuant to the Distribution Agreement, subject to limited
exceptions, the two companies are required to indemnify each other and each
other's directors, officers, employees, agents and representatives for
liabilities under federal or state securities laws that are a result of the
Offering and the Distribution, including liabilities arising out of or based
upon alleged misrepresentations in or omissions from the Registration Statement
on Form S-4, the Registration Statement on Form 10, the Special Meeting Proxy
Statement and other disclosure documents prepared in connection with the
Distribution by such party. The Distribution Agreement also provides that each
party thereto will indemnify the other party thereto and its directors,
officers, employees, agents and representatives for liabilities that may be
incurred by the indemnified party relating to, resulting from or arising out of
(i) the business, operations or assets conducted or owned or formerly conducted
or owned by the indemnifying party and its subsidiaries, or (ii) the failure by
the indemnifying party to comply with any other agreements executed in
connection with the Distribution or the Offering. In addition, the Distribution
Agreement provides that each party will indemnify the other party and its
directors, officers, employees, agents and representatives for any liabilities
resulting from or arising out of certain acts, failures to act or the provision
of incorrect factual information by the indemnifying party in connection with
the IRS private letter ruling request that causes the Distribution to be taxable
to the indemnified party or its stockholders. In addition, because the business
to be conducted by Marcam Solutions was conducted through Marcam Corporation
until the Distribution, the Company may be liable for the liabilities of Marcam
Solutions for the period prior to the Distribution. If Marcam Solutions for any
reason is unable to satisfy its liabilities, the Company may be liable for them.

The ancillary agreements executed and delivered together with the
Distribution Agreement include a General Services Agreement and a Tax Sharing
Agreement. The General Services Agreement provides that Marcam Solutions and
the Company will provide to each other from time to time, upon request, certain
routine and ordinary corporate services, including financial, accounting,
administrative, tax and legal services. For these services, the party providing
such services will be reimbursed for its costs, including the pro rata costs of
its employees performing such services and allocable overhead, on a per diem
basis.

In connection with the Distribution, Marcam Corporation and Marcam
Solutions have entered into a Tax Sharing Agreement that defines the parties
rights and obligations with respect to certain tax liabilities and refunds of
taxes relating to Marcam Corporation's business for periods ending on or prior
to the date of the Distribution. In general, pursuant to the Tax Sharing
Agreement, Marcam Solutions shall be responsible for certain state, local and
foreign taxes for periods ending on or before the date of the Distribution (and
shall be entitled to refunds with respect to such taxes), and the Company shall
be responsible for all other taxes for such periods (and shall be entitled to
refunds with respect to such taxes). In addition, under the Tax Sharing
Agreement, the Company shall be liable for any taxes arising out of the
Distribution. The Tax Sharing Agreement further provides for cooperation with
respect to certain tax matters, the exchange of information and the retention
of records.

40
<PAGE>

PRINCIPAL STOCKHOLDERS

The following table sets forth certain information regarding beneficial
ownership of the Company's voting securities (i) by each person who, to the
knowledge of the Company, beneficially owns more than 5% of any class of the
Company's voting securities; (ii) by each person who is expected to become a
director of the Company immediately following the Offering; (iii) by each
person who is expected to become an executive officer of the Company
immediately following the Offering; and (iv) by all persons who are expected to
become directors and executive officers of the Company immediately following
the Offering as a group.

<TABLE>
<CAPTION>
Percent of Total
Shares
----------------------
Shares Beneficially Before After
Name and Address Owned (1) Offering Offering
- ----------------------------------------------- --------------------- ---------- ---------
<S> <C> <C> <C>
General Atlantic Partners, LLC (2) ......... 4,000,000 25.8% 18.6%
Clover Capital Management, Inc. (3) ......... 2,628,625 22.8% 15.0%
Pioneer Management Corporation (4) ......... 1,140,000 9.9% 6.5%
Richard C. Cook (5) ........................ 48,500 * *
William J. Gilmour (6) ..................... 2,698 * *
Thomas F. Aery (7) ........................... 8,275 * *
George A. Chamberlain, 3d (8) ............... 48,000 * *
William E. Ford (9) ........................ 4,000,000 25.8% 18.6%
Edward J. Kfoury (10) ........................ 11,600 * *
All executive officers and directors as a group
(6 persons) (11) ........................... 4,119,073 26.3% 19.0%
</TABLE>

- ------------
* less than 1%
(1) The persons and entities named in the table have sole voting and investment
power with respect to all shares shown as beneficially owned by them,
except as noted below. Information is as of May 31, 1997, unless otherwise
indicated. As of May 31, 1997, there were outstanding 11,535,010 shares of
Common Stock. Pursuant to the rules of the Securities and Exchange
Commission, the number of shares of Common Stock deemed outstanding for a
specified person or group includes shares issuable pursuant to convertible
securities, warrants and options held by such person or group which may be
converted or exercised within 60 days of this Prospectus.
(2) Consists of 176,058 shares of Series D Preferred Stock held by General
Atlantic Partners 21, L.P. ("GAP 21"), 23,942 shares of Series D Preferred
Stock and 13,681 shares of Series E Preferred Stock held by GAP
Coinvestment Partners, L.P. ("GAP Coinvestment") and 86,319 shares of
Series E Preferred Stock held by General Atlantic Partners 32, L.P. ("GAP
32"). Each share of Series D Preferred Stock and Series E Preferred Stock
currently is convertible at any time into 10 shares of Common Stock. Also
includes warrants to purchase 863,190 and 136,810 shares of Common Stock
held by GAP 32 and GAP Coinvestment, respectively. GAP Coinvestment, GAP
21, GAP 32 and General Atlantic Partners, LLC ("GAP LLC"), the sole general
partner of GAP 21 and GAP 32 (the "GA Entities"), own beneficially
4,000,000 shares of Common Stock of the Company. The GA Entities own
beneficially 88.9% of the outstanding Series D Preferred Stock and 100% of
the outstanding Series E Preferred Stock. Mr. Ford, William O. Grabe,
Steven A. Denning, David C. Hodgson, Stephen P. Reynolds and J. Michael
Cline (the "GA Members") are the managing members of GAP LLC, which is the
sole general partner of GAP 21 and GAP 32, and are the same persons who
have voting and investment control over securities held by GAP
Coinvestment. The GA Members disclaim beneficial ownership of such shares,
except to the extent of each member's proportionate pecuniary interest
therein.
(3) According to Amendment No. 3 to Schedule 13G dated February 11, 1997.
Clover Capital Management, Inc., a registered investment adviser for
various accounts, has shared voting and investment power with respect to
2,628,625 shares.
(4) According to Amendment No. 1 to Schedule 13G dated January 21, 1997. Of the
1,140,000 shares beneficially owned by Pioneer Management Corporation
("Pioneer"), it has sole voting power with respect to 1,140,000 shares,
shared investment power with respect to 1,132,000 shares and sole
investment power with respect to 8,000 shares.
(5) Consists of 100 shares held by Mr. Cook's wife and 48,400 shares issuable
upon the exercise of outstanding stock options exercisable currently or
within 60 days.
(6) Includes 2,525 shares issuable upon the exercise of outstanding stock
options exercisable currently or within 60 days.
(7) Consists of 8,275 shares issuable upon the exercise of outstanding stock
options exercisable currently or within 60 days.
(8) Consists of 48,000 shares issuable upon the exercise of outstanding stock
options exercisable currently or within 60 days.
(9) Consists of 4,000,000 shares of Common Stock beneficially owned by the GA
Entities. See note 2, above.
(10) Includes 6,600 shares issuable upon the exercise of outstanding stock
options exercisable currently or within 60 days.
(11) Includes 113,800 shares which the directors and executive officers as a
group have the right to acquire upon the exercise of outstanding stock
options exercisable currently or within 60 days granted under the Company's
stock plans.

41
<PAGE>

DESCRIPTION OF CAPITAL STOCK

The Company's authorized capital stock consists of 50,000,000 shares of
Common Stock, par value $.01 per share, and 1,000,000 shares of preferred stock,
par value $1.00 per share (the "Preferred Stock").

As of May 31, 1997, there were outstanding 11,535,010 shares of Common
Stock held of record by 597 stockholders and 325,000 shares of Series D and E
Preferred Stock convertible into 3,250,000 shares of Common Stock. Based upon
the number of shares of Common Stock outstanding as of that date and giving
effect to the issuance of 6,000,000 shares of Common Stock offered hereby,
there will be 17,535,010 shares of Common Stock outstanding upon the closing of
the Offering (20,785,010 shares on an as converted basis).

Initially, holders of the Company capital stock will have the same rights,
preferences and privileges with respect to such capital stock as holders of
Marcam Corporation's capital stock have currently.

Common Stock
Except as otherwise provided by law, the Company's Restated Articles of
Organization or the description of the Preferred Stock below, holders of
Preferred Stock and Common Stock vote together as a class on all matters to be
voted on by the stockholders of the Company and holders of Common Stock are
entitled to one vote for each share held on all matters submitted to a vote of
stockholders and do not have cumulative voting rights. Holders of Common Stock
will not have any conversion, redemption, subscription or preemptive rights.
Holders of Common Stock are entitled to receive ratably such dividends, if any,
as may be declared by the Board of Directors out of funds legally available
therefor, subject to any preferential dividend rights of any then outstanding
Preferred Stock. Upon the dissolution, liquidation or winding up of the
Company, whether voluntary or involuntary, holders of Common Stock will be
entitled to receive ratably all of the net assets of the Company available for
distribution to its stockholders after the payment of all debts and
liabilities, subject to any preferential and participation rights of any then
outstanding Preferred Stock. The rights, preferences and privileges of holders
of Common Stock are subject to, and may be adversely affected by, the rights of
holders of shares of Series D Convertible Preferred Stock and Series E
Convertible Preferred Stock and the rights of any series of Preferred Stock
which the Company may designate and issue in the future.

Preferred Stock
Of the 1,000,000 authorized shares of Preferred Stock, one share has been
designated as Series A Preferred Stock, one share has been designated as Series
B Preferred Stock, one share has been designated as Series C Preferred Stock,
225,000 shares have been designated as Series D Convertible Preferred Stock,
100,000 shares have been designated as Series E Convertible Preferred Stock and
30,000 shares have been designated as Series F Junior Participating Preferred
Stock. As of May 31, 1997, there were outstanding 225,000 shares of Series D
Convertible Preferred Stock and 100,000 shares of Series E Convertible
Preferred Stock. For certain information regarding the Series F Junior
Participating Preferred Stock, see "Rights Plan."

Dividends. Holders of Series D Convertible Preferred Stock and Series E
Convertible Preferred Stock (the "Convertible Preferred Stock") are entitled to
receive (on an as converted basis), out of funds legally available therefor,
dividends at the same rate as dividends (other than dividends paid in
additional shares of Common Stock) are paid with respect to the Common Stock.

Conversion. A holder of Convertible Preferred Stock has the right, at its
option at any time, to convert any such shares of Convertible Preferred Stock
into ten shares of Common Stock, subject to adjustment. At the time of each
conversion, the Company will pay in cash an amount equal to all dividends
(other than dividends paid in additional shares of Common Stock) declared but
unpaid on the shares of Convertible Preferred Stock surrendered for conversion.
The Company does not have the right to redeem the Convertible Preferred Stock.

Voting Rights. Except as otherwise provided by law and the Company's
Restated Articles of Organization, the holders of Preferred Stock and Common
Stock vote together as a single class on all matters to be voted on by the
stockholders of the Company on the following basis: (i) each holder of
Convertible Preferred Stock is entitled to such number of votes per share on
each action as shall equal the number of shares of Common Stock (including
fractions of a share) into which each share of Convertible Preferred Stock is
then convertible and (ii) each holder of Common Stock is entitled to one vote
per share. As long as the GA Entities (together with their affiliates) own in
the aggregate shares of Common Stock, Convertible Preferred Stock or other
securities of the Company convertible into or exchangeable for shares of voting
capital stock of the Company that represent at least 10% of

42
<PAGE>

the total number of shares of Common Stock outstanding on an as converted
basis, the GA Entities will be entitled to elect, or designate one person for
election as, a director of the Company.

Liquidation. Upon any liquidation, dissolution or winding up of the
Company, whether voluntary or involuntary (each a "Liquidation Event"), the
Convertible Preferred Stock will be entitled, before any distribution or
payment is made upon any stock ranking junior, to be paid an amount equal to
the greater of (i) $100 per share plus, in the case of each share, an amount
equal to any dividends declared but unpaid thereon, through the date payment
thereof is made available, or (ii) such amount per share as would have been
payable had each such share been converted to Common Stock immediately prior to
such Liquidation Event and the holders of Convertible Preferred Stock are not
entitled to any further payment. Upon any such Liquidation Event after the
holders of Preferred Stock have been paid in full the amount to which such
holders are entitled, the remaining net assets of the Company may be
distributed to the holders of stock ranking junior.

Future Issuances. The Board of Directors is authorized, subject to any
limitations prescribed by law, without further stockholder approval, to issue
from time to time the remaining shares of Preferred Stock in one or more
series. Each such series of Preferred Stock shall have such number of shares,
designations, preferences, voting powers, qualifications and special or
relative rights or privileges as shall be determined by the Board of Directors.
The issuance of Preferred Stock, while providing desirable flexibility in
connection with possible acquisitions and other corporate purposes, could have
the effect of making it more difficult for a third party to acquire, or of
discouraging a third party from acquiring, a majority of the outstanding voting
stock of the Company. The Company has no present plans to issue any additional
shares of Preferred Stock.

Warrants
On May 12, 1994, in connection with the issuance and sale of $25,000,000
in aggregate principal amount of its 9.82% Subordinated Notes due on April 30,
2001, the Company issued warrants to purchase an aggregate of 383,333 shares of
Common Stock of the Company, as adjusted from time to time. The warrants are
exercisable at any time during the period commencing June 30, 1994 and ending
April 30, 2001, at an exercise price of $8.93 per share, as adjusted from time
to time.

On July 19, 1996, in connection with the issuance and sale of the Series E
Convertible Preferred Stock, the Company issued and sold warrants to purchase
an aggregate of 1,000,000 shares of Common Stock of the Company, as adjusted
from time to time, for an aggregate purchase price of $500,000. The warrants
are exercisable at any time during the period commencing July 23, 1996 and
ending July 23, 2003, at an exercise price of $15.36 per share, as adjusted
from time to time.

For the effects of the Distribution on these warrants, see "The
Distribution."

Massachusetts Law and Certain Charter Provisions
The Company is subject to the provisions of Chapter 110F of the
Massachusetts General Laws and anti-takeover law. In general, this statute
prohibits a publicly held Massachusetts corporation such as the Company from
engaging in a "business combination" with an "interested stockholder" for a
period of three years after the date of the transaction in which the person
becomes an interested stockholder, unless (i) the interested stockholder
obtains the approval of the Board of Directors prior to becoming an interested
stockholder, (ii) the interested stockholder acquires 90% of the outstanding
voting stock of the corporation (excluding shares held by certain affiliates of
the corporation) at the time it becomes an interested stockholder or (iii) the
business combination is approved by both the Board of Directors and the holders
of two-thirds of the outstanding voting stock of the corporation (excluding
shares held by the interested stockholder). An "interested stockholder" is a
person who, together with affiliates and associates, owns (or at any time
within the prior three years did own) 5% or more the outstanding voting stock
of the corporation. A "business combination" includes a merger, a stock or
asset sale, and other transactions resulting in a financial benefit to the
stockholder.

The Company's Amended and Restated By-laws include a provision which
excludes the Company from the applicability of Massachusetts General Laws
Chapter 110D, entitled "Regulation of Control Share Acquisitions." In general,
this statute provides that any stockholder of a corporation subject to this
statute who acquires 20% or more of the outstanding voting stock of a
corporation may not vote such stock unless the stockholders of the corporation
so authorize. The Board of Directors may amend the Company's Amended and
Restated By-laws at any time to subject the Company to this statute
prospectively.

43
<PAGE>

Massachusetts General Laws Chapter 156B, Section 50A require that a
publicly held Massachusetts corporation have a classified board of directors
consisting of three classes as nearly equal in size as possible, unless the
corporation elects not to be covered by Section 50A. The Company is subject to
the provisions of Section 50A.

The Company's Restated Articles of Organization also include provisions to
(i) eliminate the personal liability of the Company's directors for monetary
damages resulting from breaches of their fiduciary duty to the extent permitted
by the Massachusetts Business Corporation Law and (ii) indemnify the Company's
directors and officers to the fullest extent permitted by Massachusetts law,
including under circumstances in which indemnification is otherwise
discretionary. Also, the Company has entered into indemnity agreements with
each of its directors and certain executive officers. Those agreements require
the Company to indemnify such individuals to the fullest extent permitted by
Massachusetts law.

Rights Plan
Pursuant to the Company's Stockholder Rights Plan, each share of the
Common Stock has an associated preferred stock purchase right (a "Right") and
each share of Convertible Preferred Stock has ten associated Rights. Each Right
entitles the holder to purchase from the Company a unit consisting of one
one-thousandth of a share of Series F Junior Participating Preferred Stock, par
value $1.00 per share (the "Junior Preferred Shares"), of the Company at a
price of $60.00 per unit, subject to adjustment (the "Purchase Price"). The
Rights will be exercisable only if (i) a person or group other than an Exempt
Person (as defined below) acquires beneficial ownership of 20% or more of the
outstanding Common Stock (an "Acquiring Person"), (ii) a person or group
announces a tender offer or exchange offer the consummation of which would
result in the beneficial ownership by such person or group of 20% or more of
the outstanding Common Stock or (iii) a person owning 10% or more of the Common
Stock of the Company whose ownership is determined by the Board of Directors to
be reasonably likely to cause a material adverse impact on the business or
prospects of the Company or to pressure the Company to take action to benefit
such person as opposed to the Company is declared by the Board of Directors to
be an adverse person (an "Adverse Person"). Until a Right is exercised, the
holder thereof will have no rights as a stockholder of the Company. General
Atlantic Partners and its affiliates would each be deemed "Exempt Persons",
subject to compliance with their standstill agreements with the Company.

In the event that (i) any person or group acquires 20% or more of the
outstanding Common Stock, except pursuant to a tender or exchange offer for all
shares at a price that a majority of the continuing directors determines to be
fair, (ii) a person owning 10% or more of the Common Stock is determined by the
Board of Directors to be an Adverse Person, (iii) a person owning 20% or more
of the outstanding Common Stock engages in a merger with the Company in which
the Company survives and its Common Stock remains outstanding and unchanged, or
(iv) while there is an Acquiring Person, such person engages in certain
self-dealing transactions or an event occurs which results in such person's
stock holdings increasing by more than 1%, each holder of a Right, other than
Rights beneficially owned by the Acquiring Person or the Adverse Person, will
thereafter have the right to receive upon exercise that number of shares of
Common Stock having a market value of two (2) times the Purchase Price, and in
the event that, while there is an Acquiring Person, the Company is acquired in
a business combination transaction in which it does not survive or 50% or more
of its assets are sold, each holder of a Right will thereafter have the right
to receive upon exercise that number of shares of common stock of the acquiring
company which at the time of the transaction will have a market value of two
(2) times the Purchase Price. The events set forth in this paragraph are
referred to as "Section 11(a)(ii) Events."

At any time after the occurrence of a Section 11(a)(ii) Event, the Board
of Directors of the Company may cause the Rights (other than Rights owned by
such person or group) to be exchanged, in whole or in part, for Common Stock at
an exchange rate of one (1) share of Common Stock per Right.

The Board of Directors of the Company will generally be entitled to redeem
the Rights in whole at a price of $.01 per Right, until the tenth day following
a public announcement that a 20% stock position has been acquired and in
certain other circumstances.

The Rights have a certain anti-takeover effects, in that they will cause
substantial dilution to a person or group that attempts to acquire a
significant interest in the Company on terms not approved by the Board of
Directors.

Transfer Agent
The transfer agent and registrar for the Company's Common Stock is Boston
EquiServe LP.

44
<PAGE>

UNDERWRITING

Subject to certain conditions contained in the Underwriting Agreement, a
syndicate of underwriters named below (the "Underwriters"), for whom Donaldson,
Lufkin & Jenrette Securities Corporation, Lazard Freres & Co. LLC and Dain
Bosworth Incorporated are acting as representatives (the "Representatives"),
have severally agreed to purchase from the Company an aggregate of 6,000,000
shares of Common Stock. The number of shares of Common Stock that each
Underwriter has agreed to purchase is set forth opposite its name below:

<TABLE>
<CAPTION>
Number of
Underwriters Shares
- ------------------------------------------------------------ -----------
<S> <C>

Donaldson, Lufkin & Jenrette Securities Corporation ...... 1,490,000
Lazard Freres & Co. LLC ................................. 1,490,000
Dain Bosworth Incorporated .............................. 1,490,000
Alex. Brown & Sons Incorporated ............................ 90,000
Cowen & Company ............................................ 90,000
Deutsche Morgan Grenfell Inc. .............................. 90,000
Goldman, Sachs & Co. ....................................... 90,000
Hambrecht & Quist LLC ...................................... 90,000
Montgomery Securities ...................................... 90,000
Morgan Stanley & Co., Incorporated ......................... 90,000
Robertson, Stephens & Company LLC .......................... 90,000
Salomon Brothers Inc. ...................................... 90,000
Smith Barney Inc. .......................................... 90,000
William Blair & Company, L.L.C. ............................ 45,000
EVEREN Securities, Inc. .................................... 45,000
First Albany Corporation ................................... 45,000
First Analysis Securities Corporation ...................... 45,000
Janney Montgomery Scott Inc. ............................... 45,000
Johnston, Lemon & Co. Incorporated ......................... 45,000
Needham & Company, Inc. .................................... 45,000
The Ohio Company ........................................... 45,000
Parker/Hunter Incorporated ................................. 45,000
Ryan, Beck & Co. ........................................... 45,000
Sands Brothers & Co., Ltd. ................................. 45,000
Soundview Financial Group, Inc. ............................ 45,000
Unterberg Harris, L.P. ..................................... 45,000
Wessels, Arnold & Henderson, L.L.C. ........................ 45,000
---------

Total ................................................... 6,000,000
=========
</TABLE>

The Underwriting Agreement provides that the obligations of the several
Underwriters to purchase the shares of Common Stock offered hereby are subject
to approval of certain legal matters by their counsel and to certain other
conditions. If any of the shares of Common Stock are purchased by the
Underwriters pursuant to the Underwriting Agreement, the Underwriters are
obligated to purchase all such shares (other than those covered by the
over-allotment option described below).

The Company has been advised by the Underwriters that they propose to offer
the shares of Common Stock to the public initially at the price to the public
set forth on the cover page of this Prospectus and to certain dealers (including
the Underwriters) at such price, less a concession not in excess of $.37 per
share. The Underwriters may allow, and such dealers may re-allow, a concession
not in excess of $.10 per share to certain other dealers.

The Company has granted to the Underwriters an option, exercisable for 30
days from the date of this Prospectus, to purchase up to 900,000 additional
shares of Common Stock at the initial price to the public less underwriting
discounts and commissions, solely to cover over-allotments. To the extent that
the Underwriters exercise such option, each of the Underwriters will be
committed, subject to certain conditions, to purchase a number of option shares
pro rata in accordance with such Underwriter's initial commitment as indicated
in the preceding table.

<PAGE>

In the Underwriting Agreement, the Company and the Underwriters have
agreed to indemnify each other against certain liabilities, including
liabilities under the Securities Act.

The Company, certain of its officers and directors and certain other
stockholders will agree not to (i) pledge, offer, sell, contract to sell, sell
any options or contracts to purchase, purchase any options or contracts to
sell, grant any option, right or warrant to purchase or otherwise transfer or
dispose of, directly or indirectly, any shares of Common Stock or any
securities convertible into or exercisable or exchangeable for Common Stock or
(ii) enter into any swap or other arrangement that transfers all or a portion
of the economic consequences associated with the ownership of any Common Stock
(regardless of whether any of the transactions described in clause (i) or (ii)
is to be settled by the delivery of Common Stock, or such other securities, in
cash or otherwise) for a period of 180 days after the date of this Prospectus
without the prior written consent of Donaldson, Lufkin & Jenrette Securities
Corporation provided that the Company may grant options and issue Common Stock
upon the exercise of options under its option plans. In addition, during such
period, the Company will also agree not to file any registration statement with
respect to, and each of its executive officers, directors and certain
stockholders of the Company will agree not to make any demand for, or exercise
any right with respect to, the registration of any shares of Common Stock or
any securities convertible into or exercisable or exchangeable for Common Stock
without Donaldson, Lufkin & Jenrette Securities Corporation's prior written
consent.

In general, the rules of the Securities and Exchange Commission prohibit
the Underwriters (and selling group members) from making a market in the Common
Stock during the "cooling off" period immediately preceding the commencement of
sales in the Offering. The Commission has, however, adopted exemptions from
these rules that permit passive market making under certain conditions. In
connection with the Offering, the Underwriters and dealers may engage in passive
market making transactions in the Common Stock in accordance with Rule 103 of
Regulation M promulgated by the Securities and Exchange Commission. In general,
a passive market maker may not bid for or purchase the Common Stock at a price
that exceeds the highest independent bid. In addition, the net daily purchases
made by any passive market maker generally may not exceed 30% of its average
daily trading volume in the Common Stock during a specified two month prior
period, or 200 shares, whichever is greater. A passive market maker must
identify passive market making bids on the Nasdaq electronic inter-dealer
reporting system. Passive market making may stabilize or maintain the market
price of the Common Stock above independent market levels. The Underwriters are
not required to engage in passive market making and may end passive market
making activities at any time.

In connection with the Offering, the Underwriters may engage in
transactions that stabilize, maintain or otherwise affect, the price of the
Common Stock. Specifically, the Underwriters may overallot the Offering,
creating a syndicate short position. Underwriters may bid for and purchase
shares of Common Stock in the open market to cover syndicate short positions.
In addition, the Underwriters may bid for and purchase shares of Common Stock
in the open market to stabilize the price of the Common Stock. These activities
may stabilize or maintain the market price of the Common Stock above
independent market levels. The Underwriters are not required to engage in these
activities and may end these activities at any time.

The Representatives have informed the Company that the Underwriters do not
intend to confirm sales to any account over which they exercise discretionary
authority.

As a result of the Distribution, historical trading prices of the Common
Stock of Marcam Corporation on the Nasdaq National Market are unlikely to be
indicative of future trading prices of the Common Stock. The price to the public
for the shares of Common Stock has been determined through negotiations between
the Company and the Representatives and was based on, among other things, the
Company's financial and operating history and condition, the prospects of the
Company and its industry in general, the management of the Company and the
market prices of securities of companies engaged in businesses similar to those
of the Company. There can, however, be no assurance that the prices at which the
shares of Common Stock will sell in the public market after this Offering will
not be lower than the price at which they are sold by the Underwriters.

<PAGE>

LEGAL MATTERS

The validity of the shares of Common Stock offered hereby will be passed
upon for the Company by Testa, Hurwitz & Thibeault, LLP, Boston, Massachusetts.
Certain legal matters in connection with this Offering will be passed upon for
the Underwriters by Hale and Dorr LLP, Boston, Massachusetts.

EXPERTS

The combined balance sheets of MAPICS, Inc. as of September 30, 1995 and
1996 and March 31, 1997 and the related combined statements of operations,
divisional equity, and cash flows for each of the three years in the period
ended September 30, 1996 and for the six months ended March 31, 1997, included
in this Prospectus and Registration Statement, have been included in reliance
on the report of Coopers & Lybrand L.L.P., independent accountants, given on
the authority of that firm as experts in accounting and auditing.

The consolidated financial statements of Marcam Corporation as of
September 30, 1996 and 1995 and for each of the two years in the period ended
September 30, 1996, included in the Annual Report on Form 10-K of the Company
for the year ended September 30, 1996 and referred to below, have been audited
by Coopers & Lybrand L.L.P., independent accountants, as set forth in their
report dated October 24, 1996, accompanying such financial statements, and are
incorporated herein by reference in reliance upon the report of such firm,
which report is given upon their authority as experts in accounting and
auditing.

The consolidated financial statements of Marcam Corporation and
subsidiaries for the year ended September 30, 1994, have been incorporated by
reference herein in reliance upon the report of KPMG Peat Marwick LLP,
independent certified public accountants, incorporated by reference herein, and
upon the authority of said firm as experts in accounting and auditing.

47
<PAGE>

INFORMATION INCORPORATED BY REFERENCE

The following documents filed by the Registrant with the Securities and
Exchange Commission (the "Commission") pursuant to the Exchange Act are
incorporated in this Prospectus by reference as of their respective dates (File
No. 0-18674): (1) Annual Report on Form 10-K for the fiscal year ended
September 30, 1996, including portions of Marcam Corporation's Proxy Statement
dated January 8, 1997 for its Annual Meeting of Stockholders held on February
12, 1997 set forth under the captions "Election of Directors," "The Board of
Directors and its Committees," "Executive Compensation," "Securities Ownership
of Certain Beneficial Owners and Management" and "Certain Relationships and
Related Transactions"; (2) Quarterly Reports on Form 10-Q for the fiscal
periods ended December 31, 1996 and March 31, 1997; (3) Current Reports on Form
8-K dated December 3, 1996, May 9, 1997, as amended on July 3, 1997, July 15,
1997 and July 23, 1997; (4) the section entitled "Description of Securities to
be Registered" contained in the Registrant's Registration Statement on Form 8-A
filed with the Commission on December 5, 1996; and (5) the section entitled
"Description of Securities to be Registered" contained in the Registrant's
Registration Statement on Form 8-A filed on June 29, 1990, as amended on Form 8
as filed with the Commission on August 13, 1990.

All documents subsequently filed by the Company pursuant to Section 13(a),
13(c), 14 or 15(d) of the Exchange Act after the date of this Prospectus and
prior to the termination of the Offering shall be deemed to be incorporated by
reference in this Prospectus from the date of filing of such documents. Any
statement contained in a document incorporated or deemed to be incorporated by
reference herein shall be deemed to be modified or superseded for purposes of
this Prospectus to the extent that a statement contained herein or in any other
subsequently filed document which is also deemed to be incorporated by
reference herein modifies or supersedes such statement. Any such statement so
modified or superseded shall not be deemed, except as so modified or
superseded, to constitute a part of this Prospectus.

The Company will provide without charge to each person, including any
beneficial owner, to whom a Prospectus is delivered, upon written or oral
request of such person, a copy of any or all of the documents described above
(other than exhibits to such documents). Requests for such copies should be
directed to George A. Chamberlain, 3d, Chief Financial Officer, Marcam
Corporation, 95 Wells Avenue, Newton, Massachusetts 02159 (telephone:
617-965-0220).

AVAILABLE INFORMATION

The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports, proxy statements and other information with the
Commission. All such reports, proxy statements and other information can be
inspected and copied at the public reference facilities maintained by the
Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, and at the
following regional offices of the Commission: 73 Tremont Street, Suite 600,
Boston, Massachusetts 02108-3912; 7 World Trade Center, Suite 1300, New York,
New York 10048; and Citicorp Center, 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661-2511. Copies of such material may also be obtained from
the Public Reference Section of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549 at prescribed rates. The Commission maintains a
World-Wide Web site that contains reports, proxy and information statements and
other information regarding registrants that file electronically with the
Commission. The address of the Commission's Web site is http://www.sec.gov. The
Common Stock of the Company is quoted on The Nasdaq National Market and such
material may also be inspected at the offices of the National Association of
Securities Dealers, Inc., 1735 K Street, N.W., Washington, D.C. 20006.

The Company has filed with the Commission a Registration Statement on Form
S-3 (including all amendments thereto, the "Registration Statement") under the
Securities Act, with respect to the Common Stock offered hereby. This
Prospectus, which constitutes part of the Registration Statement, does not
contain all information set forth in the Registration Statement, certain parts
of which are omitted in accordance with the rules and regulations of the
Commission. For further information regarding the Company and the Common Stock
offered hereby, reference is hereby made to the Registration Statement and to
the exhibits and schedules filed therewith. Statements contained in this
Prospectus regarding the contents of any agreement or other document filed as
an exhibit to the Registration Statement are not necessarily complete, and in
each instance reference is made to the copy of such agreement filed as an
exhibit to the Registration Statement, each such statement being qualified in
all respects by such reference. The Registration Statement, including the
exhibits and schedules thereto, may be inspected at the Public Reference
Section of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549 and
copies of all or any part thereof may be obtained from such office upon payment
of the prescribed fees.

48
<PAGE>

[THIS PAGE INTENTIONALLY LEFT BLANK]

<PAGE>

MAPICS, INC.

INDEX TO COMBINED FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
Page
-----
<S> <C>
Report of Independent Accountants ...................................................... F-2
Combined Balance Sheets as of September 30, 1995 and 1996 and March 31, 1997 ............ F-3
Combined Statements of Operations for the years ended September 30, 1994, 1995 and 1996
and for the six months ended March 31, 1996 (unaudited) and 1997 ...................... F-4
Combined Statements of Divisional Equity for the years ended September 30, 1994, 1995 and
1996 and for the six months ended March 31, 1997 .................................... F-5
Combined Statements of Cash Flows for the years ended September 30, 1994, 1995 and 1996
and for the six months ended March 31, 1996 (unaudited) and 1997 ...................... F-6
Notes to Combined Financial Statements ................................................ F-7
</TABLE>

F-1
<PAGE>

REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Directors and Stockholders of Marcam Corporation:

We have audited the accompanying combined balance sheets of MAPICS, Inc. as of
September 30, 1995 and 1996 and March 31, 1997 and the related combined
statements of operations, divisional equity, and cash flows for each of the
three years in the period ended September 30, 1996 and for the six months ended
March 31, 1997. These financial statements are the responsibility of MAPICS,
Inc.'s management. Our responsibility is to express an opinion on these
financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the combined financial position of MAPICS, Inc. as of
September 30, 1995 and 1996 and March 31, 1997, and the combined results of its
operations and its cash flows for each of the three years in the period ended
September 30, 1996 and for the six months ended March 31, 1997, in conformity
with generally accepted accounting principles.

COOPERS & LYBRAND L.L.P.

Boston, Massachusetts
June 3, 1997

F-2
<PAGE>

MAPICS, INC.

Combined Balance Sheets
(In thousands)

As of September 30, As of March 31,
--------------------- --------------------------
1995 1996 1997 1997
Pro Forma
(unaudited)
<S> <C> <C> <C> <C>
ASSETS
Current assets:
Cash ......................................................... $ 226 $ 378 $ 852 $ 852
Accounts receivable, net of allowances of $1,626 in 1995,
$1,240 in 1996 and $1,466 in 1997 (Note 3) .................. 20,416 20,518 21,141 21,141
Prepaid expenses and other current assets ..................... 369 487 1,032 1,032
-------- -------- -------- --------
Total current assets ....................................... 21,011 21,383 23,025 23,025
Property and equipment, net (Note 4) ........................... 1,755 2,992 2,813 2,813
Computer software costs, net (Note 5) ........................ 12,495 15,705 15,741 15,741
Other intangible assets, net (Notes 7 and 13) .................. 5,965 5,325 5,067 5,067
-------- -------- -------- --------
Total assets ............................................. $41,226 $45,405 $46,646 $46,646
======== ======== ======== ========
LIABILITIES AND DIVISIONAL EQUITY
Current liabilities:
Accounts payable ............................................. $ 3,659 $ 5,308 $ 4,412 $4,412
Note payable (Note 15) ......................................... - - - 64,000
Accrued expenses and other current liabilities (Note 6) ...... 10,673 11,457 11,415 11,415
Deferred revenue ............................................. 15,206 18,563 21,197 21,197
-------- -------- -------- -------
Total current liabilities ................................. 29,538 35,328 37,024 101,024
Deferred income taxes (Note 8) ................................. 196 884 394 394
-------- -------- -------- -------
Total liabilities .......................................... 29,734 36,212 37,418 101,418
Commitments and contingencies (Notes 9 and 15) ...............
Divisional equity (deficit) .................................... 11,492 9,193 9,228 (54,772)
-------- -------- -------- -------
Total liabilities and divisional equity .................... $41,226 $45,405 $46,646 $46,646
======== ======== ======== =======
</TABLE>

The accompanying notes are an integral part of the combined financial
statements.

F-3
<PAGE>

MAPICS, INC.

Combined Statements of Operations
(In thousands, except per share data)

<TABLE>
<CAPTION>
Six months ended
Years ended September 30, March 31,
--------------------------------- ------------------------
1994 1995 1996 1996 1997
(unaudited)
<S> <C> <C> <C> <C> <C>

Revenues:
License .............................. $33,410 $42,745 $45,341 $20,501 $25,328
Services .............................. 19,373 26,553 32,261 15,343 18,837
-------- -------- -------- -------- --------
Total revenues ..................... 52,783 69,298 77,602 35,844 44,165
-------- -------- -------- -------- --------
Operating expenses:
Cost of license revenues ............ 3,280 5,689 6,913 3,026 4,129
Cost of services revenues ............ 5,428 7,567 9,499 4,573 5,301
Selling and marketing ............... 17,765 24,780 27,851 13,028 14,834
Product development .................. 6,692 7,432 6,398 3,122 4,969
General and administrative ............ 4,810 5,384 5,965 2,212 4,360
-------- -------- -------- -------- --------
Total operating expenses ............ 37,975 50,852 56,626 25,961 33,593
-------- -------- -------- -------- --------
Income before income tax expense ...... 14,808 18,446 20,976 9,883 10,572
Income tax expense ..................... 4,641 7,112 8,076 3,805 4,071
-------- -------- -------- -------- --------
Net income ........................... $10,167 $11,334 $12,900 $ 6,078 $ 6,501
======== ======== ======== ======== ========
Pro forma net income per common
share (Note 2) (unaudited) ............ $ 0.70 $ 0.34
======== ========
Pro forma weighted average number of
common and common equivalent
shares outstanding (Note 2)
(unaudited) ........................... 18,518 19,324
======== ========
</TABLE>

The accompanying notes are an integral part of the combined financial
statements.

F-4
<PAGE>

MAPICS, INC.

Combined Statements of Divisional Equity
(In thousands)

<TABLE>
<CAPTION>
Six months
ended
Years ended September 30, March 31,
--------------------------------------------- ------------
1994 1995 1996 1997
<S> <C> <C> <C> <C>
Balance, beginning of period ............... $ 21,271 $ 17,091 $ 11,492 $ 9,193
Net income .............................. 10,167 11,334 12,900 6,501
Net transfers to Marcam Corporation ...... (14,347) (16,933) (15,199) (6,466)
---------- ---------- ---------- ---------
Balance, end of period ..................... $ 17,091 $ 11,492 $ 9,193 $ 9,228
========== ========== ========== =========
</TABLE>

The accompanying notes are an integral part of the combined financial
statements.

F-5
<PAGE>

MAPICS, INC.

Combined Statements of Cash Flows
(In thousands)

<TABLE>
<CAPTION>
Six months
ended
Years ended September 30, March 31,
-------------------------------------- -------------------------
1994 1995 1996 1996 1997
(unaudited)
<S> <C> <C> <C> <C> <C>
Cash flows from operating activities:
Net income .......................................... $ 10,167 $ 11,334 $ 12,900 $ 6,078 $ 6,501
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation .................................... 545 709 954 375 660
Amortization .................................... 2,353 3,248 3,788 1,936 2,328
Provision for bad debts ........................... 6 939 399 73 611
Deferred income taxes ........................... 1,110 737 688 323 (490)
Changes in operating assets and liabilities, net
of effects of acquisition:
Accounts receivable .............................. (788) (5,302) (501) 4,447 (1,234)
Prepaid expenses and other assets ............... (418) 239 (118) (69) (266)
Accounts payable ................................. 576 383 1,071 (513) (896)
Accrued expenses and other current liabilities . 2,725 4,988 784 (2,999) (42)
Deferred revenue ................................. 4,143 5,466 3,357 2,982 2,634
--------- --------- --------- -------- --------
Net cash provided by operating activities ......... 20,419 22,741 23,322 12,633 9,806
--------- --------- --------- -------- --------
Cash flows from investing activities:
Purchases of property and equipment ............... (979) (623) (1,613) (466) (481)
Additions to computer software costs ............... (4,795) (5,516) (6,358) (3,973) (2,385)
--------- --------- --------- -------- --------
Net cash used for investing activities ............ (5,774) (6,139) (7,971) (4,439) (2,866)
--------- --------- --------- -------- --------
Cash flows from financing activities:
Net transfers to Marcam Corporation ............... (14,347) (16,483) (15,199) (7,947) (6,466)
--------- --------- --------- -------- --------
Net cash used for financing activities ......... (14,347) (16,483) (15,199) (7,947) (6,466)
--------- --------- --------- -------- --------
Net increase in cash ................................. 298 119 152 247 474
Cash at beginning of period ........................ (191) 107 226 226 378
--------- --------- --------- -------- --------
Cash at end of period .............................. $ 107 $ 226 $ 378 $ 473 $ 852
========= ========= ========= ======== ========
</TABLE>

The accompanying notes are an integral part of the combined financial
statements.

F-6
<PAGE>

MAPICS, INC.

Notes to Combined Financial Statements

(1) BASIS OF PRESENTATION

(a) The Distribution (unaudited)

On April 28, 1997, the Board of Directors of Marcam Corporation authorized
management to proceed with the separation of Marcam Corporation into two
publicly traded corporations. Marcam Corporation intends to spin off in a
tax-free distribution the portion of its business relating to its PRISM,
Protean and Avantis product lines. The separation into two independent,
publicly traded companies is designed to enable each to better focus on its
core markets, to better serve existing customers and to finance its business.
Marcam Corporation will change its name to MAPICS, Inc. ("MAPICS") and will
continue the operations relating to the MAPICS product lines.

In connection with the separation, Marcam Corporation will transfer to a
newly formed corporation, Marcam Solutions, Inc. ("Marcam Solutions"), the
business, assets and liabilities relating to its PRISM, Protean and Avantis
product lines and $39 million in cash. The cash transfer of $39 million is
expected to be paid with proceeds of a debt financing by Marcam Corporation,
and borrowings under that debt financing are expected to be repaid in whole or
in part with the proceeds from a proposed offering of common stock of MAPICS.
All of the shares of common stock of Marcam Solutions will be distributed (the
"Distribution") by means of a distribution to stockholders of Marcam
Corporation. Subsequent to the Distribution, MAPICS will be the legal entity
that will continue to conduct the operations relating to Marcam Corporation's
MAPICS product lines. However, for accounting purposes, due to the relative
significance of the PRISM, Protean and Avantis product lines, the Distribution
will be recorded as a disposal of the MAPICS product lines in the historical
consolidated financial statements of Marcam Corporation and in the future
financial statements of Marcam Solutions.

The Distribution will be subject to final approval by the Board of
Directors of Marcam Corporation, approval by the stockholders of Marcam
Corporation, and the receipt of a favorable ruling from the Internal Revenue
Service that, except as provided therein, the Distribution will qualify as a
tax-free distribution under Section 355 of the Internal Revenue Code of 1986,
as amended (the "Code"), or, at the option of the Board of Directors of Marcam
Corporation, an opinion of special tax counsel and Marcam Corporation's
independent accountants to the effect that, except as provided therein, such
distribution should qualify as a tax-free distribution under Section 355 of the
Code.

These combined financial statements have been prepared using Marcam
Corporation's historical basis in the assets and liabilities and historical
results of operations related to the MAPICS product lines. These combined
financial statements generally reflect the financial position, results of
operations, and cash flows of MAPICS as if it were a separate entity for all
periods presented. Certain costs and expenses presented in these financial
statements have been allocated based on management's estimates of the cost of
services provided to MAPICS by Marcam Corporation. Management believes that
these allocations are reasonable. However, the financial information included
herein may not necessarily reflect the combined financial position, results of
operations, and cash flows of MAPICS in the future, or what they would have
been had MAPICS been a separate entity during the periods presented.

Prior to the Distribution, Marcam Corporation (to be renamed MAPICS)
intends to enter into various agreements with Marcam Solutions providing for
the separation of the product lines and governing various ongoing relationships
between the two companies, in accordance with the terms described in Note 15.

(b) Nature of the Business
MAPICS is a leading provider of enterprise resource planning (ERP)
software applications for mid-size manufacturing enterprises worldwide. MAPICS'
products provide an integrated and function-rich ERP solution with the breadth
and depth of applications to manage an entire manufacturing enterprise. The
MAPICS XA product line currently consists of 44 integrated application modules
in the areas of Engineering and Cost Management, Market and Demand Management,
Plant Operations and Logistics Management, Production Resource Planning,
Financial Management and Measurements and Cross Applications Solutions. MAPICS
also provides services to customers in the form of product support. The primary
geographic markets of MAPICS include North America, Europe, the Middle East,
Africa, Latin America and Asia Pacific.

F-7
<PAGE>

MAPICS, INC.

Notes to Combined Financial Statements -- (Continued)

(2) SIGNIFICANT ACCOUNTING POLICIES

(a) Use of Estimates by Management
The preparation of combined financial statements in conformity with
generally accepted accounting principles requires management to make certain
estimates and assumptions. These estimates and assumptions affect the reported
amounts of assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the reported amounts of
revenues and expenses during the reporting periods. The most significant
estimates included in these financial statements are the valuation of
capitalized software, intangible assets and accounts receivable and the
allocation of corporate expenses from Marcam Corporation. Actual results may
differ from estimates.

(b) Revenue Recognition
MAPICS recognizes revenues from the licensing of its software upon the
signing of license agreements, delivery of the software and determination that
collection of the related receivable is probable. Under the terms of the MAPICS
license agreements, the customer is responsible for installation and training.
At the time MAPICS recognizes revenues from the licensing of software, no
significant vendor obligations remain, and the costs of insignificant
obligations, if any, are accrued.

MAPICS recognizes services revenues from its periodic license fees ratably
over the terms of the license agreements. The periodic license fee, which is
typically payable annually in advance, entitles the customer to continue using
the software and to receive certain support services.

Generally, revenues from the licensing of products through third-party
representatives are included in revenues, and related commissions are included
in selling and marketing expenses. In certain situations, however, revenues
from affiliates are recorded as royalties in license revenues (See Note 14).

(c) Concentrations of Credit Risk
Financial instruments which potentially expose MAPICS to concentrations of
credit risk consist primarily of trade accounts receivable. MAPICS provides
credit, in the normal course of business, to various types and sizes of
manufacturers located throughout the world. As a result, concentration of
credit risk with respect to trade receivables is not significant.

(d) Property and Equipment
Property and equipment are stated at cost. Depreciation is calculated
using the straight-line method based upon the following estimated useful lives:

<TABLE>
<S> <C>
Furniture and fixtures ...... 4 years
Computer equipment ......... 4 years
Leasehold improvements ...... Shorter of lease term or useful life of asset
</TABLE>

(e) Computer Software Costs
MAPICS charges all costs of establishing technological feasibility of
computer software products to product development expense as they are incurred.
Thereafter, computer software costs are capitalized and reported at the lower
of unamortized cost or net realizable value. Computer software costs include
in-house software development costs and the costs incurred to translate
software into various foreign languages. Amortization of computer software
costs commences upon general release of the product to customers and is
computed on a product-by-product basis using the greater of the amount
determined using (a) the ratio that current period gross revenues bear to the
total of current and anticipated future gross revenues or (b) the straight-line
method over the estimated economic life of the product (generally five years).
Amortization of capitalized software costs is charged to cost of license
revenues. Capitalized software is subject to rapid technological obsolescence
and, as a result, amortization periods could ultimately shorten to reflect
changes in technology in the future. In fiscal 1997, MAPICS changed the
estimated useful life of its 1997 and future translation expenditures from five
years to two years. This change in estimate decreased net income by
approximately $230,000 for the six months ended March 31, 1997.

F-8
<PAGE>

MAPICS, INC.

Notes to Combined Financial Statements -- (Continued)

(f) Other Intangible Assets
Other intangible assets represent intangible assets that are being
amortized to cost of license revenues using the straight-line method over the
estimated lives of the intangibles. The installed customer base and affiliate
network is amortized over fifteen years; trade names, trademarks and goodwill
are amortized over ten years.

MAPICS evaluates the net realizable value of capitalized software costs
and other intangibles on a quarterly basis using undiscounted cash flows. Its
review of intangible assets includes an analysis of past operating results,
business plans and budgets related to recoverability of the specific assets.

(g) Foreign Currency Translation
The majority of foreign revenues of MAPICS are denominated in local
currencies. The functional currency for each of the MAPICS foreign operations
is generally its local currency. Assets and liabilities of foreign operations
are translated into U.S. dollars at period-end rates of exchange. Revenues and
expenses are translated into U.S. dollars at the average rates for the periods.
The resultant translation gains and losses are immaterial for all periods
presented. Foreign currency transaction gains and losses and the effects of
exchange rate changes on cash are immaterial for all periods presented.

(h) Income Taxes
Historically, the operations represented by MAPICS have been included in
the consolidated U.S. Federal and certain state and foreign income tax returns
filed by Marcam Corporation. Income tax expense has been calculated on a
separate-return basis. Income taxes paid on behalf of MAPICS are included in
divisional equity. After the Distribution, MAPICS will file separate income tax
returns.

Pursuant to the anticipated Tax Sharing Agreement between Marcam
Corporation and Marcam Solutions and after the Distribution, MAPICS will be
entitled to utilize certain tax attributes (principally federal, state and
foreign net operating loss carryforwards) of Marcam Corporation.

(i) Divisional Equity
Divisional equity includes accumulated retained earnings, net transfers to
Marcam Corporation and current period income.

(j) Unaudited pro forma net income per share
Unaudited pro forma net income per share gives effect to the Distribution.
The calculation of pro forma weighted average number of shares outstanding
includes (i) the weighted average number of common shares outstanding of Marcam
Corporation (11,384,000 shares and 11,459,000 shares, respectively, for the
year ended September 30, 1996 and for the six months ended March 31, 1997),
(ii) the weighted average number of common equivalent shares from the assumed
exercise of dilutive stock options, warrants and convertible preferred stock of
Marcam Corporation (2,801,000 shares and 3,532,000 shares, respectively, for
the year ended September 30, 1996 and for the six months ended March 31, 1997),
and (iii) the number of shares of common stock from the proposed offering of
MAPICS common stock whose proceeds are deemed to be used to pay the capital
contribution of $39,000,000 to Marcam Solutions, based on an assumed offering
price of $9.00 per share (4,333,000 shares for the year ended September 30,
1996 and for the six months ended March 31, 1997) (See Note 15). Pro forma fully
diluted net income per share does not differ materially from reported pro forma
primary net income per share.

(k) Allocated Costs
Expenses have been allocated based on a variety of methods depending on
the nature of the expense. Such allocation methods include proportional MAPICS
product revenue to total Marcam Corporation revenue, headcount equivalents and
management estimates. These amounts approximate management's estimates of
Marcam Corporation's corporate costs to support the MAPICS-related operations.
An allocation of corporate marketing expenses, corporate product development
expenses, and corporate administrative functions (including data services,
employee benefits, legal, insurance, accounting and other corporate overhead)
has been included in the selling and marketing, product development, and
general and administrative operating expenses in the combined statements of
operations.

F-9
<PAGE>

MAPICS, INC.

Notes to Combined Financial Statements -- (Continued)

(l) Interim Period Financial Statements

The interim combined financial statements and related footnote information
for the six months ended March 31, 1996 are unaudited. In the opinion of
management, the interim combined financial statements contain all adjustments
of a normal recurring nature which are necessary to present fairly the interim
financial position of MAPICS and its interim results of operations and cash
flows. Results of operations and cash flows for the six months ended March 31,
1997 are not necessarily indicative of results for the entire year.

(m) New Accounting Pronouncements

In October 1995, Statement of Financial Accounting Standards No. 123,
"Accounting for Stock-Based Compensation" ("SFAS 123"), was issued which will
require MAPICS to elect either expense recognition under SFAS 123 or its
disclosure-only alternative for stock-based employee compensation. The expense
recognition provision encouraged by SFAS 123 would require fair-value based
financial accounting to recognize compensation expense for employee stock
compensation plans. MAPICS has determined that it will elect the
disclosure-only alternative. MAPICS will be required to disclose the pro forma
net income and pro forma net income per share in the notes to the financial
statements using the fair-value based method beginning in fiscal 1997 after the
Distribution, with comparable disclosures for fiscal 1996. MAPICS has not
determined the impact that these pro forma adjustments will have on its net
income or income per share.

In February 1997, Statement of Financial Accounting Standards No. 128,
"Earnings Per Share" ("SFAS 128"), was issued which will require MAPICS to
present basic and diluted earnings per share (EPS). Basic EPS, which replaces
primary EPS, excludes dilution and is computed by dividing income available to
common stockholders by the weighted-average number of common shares outstanding
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 or resulted in the issuance of common stock that then shared
in the earnings of the entity. Diluted EPS is computed similarly to fully
diluted EPS under existing rules. SFAS 128 requires restatement of all prior
period earnings per share data presented. MAPICS will adopt SFAS 128 as of
October 1, 1998 and has not yet determined the impact of the adoption of this
standard.

(3) ALLOWANCE FOR DOUBTFUL ACCOUNTS

MAPICS provides reserves for customer receivable balances which are
considered potentially uncollectible. The allowance for doubtful accounts
amounted to $733,000, $1,626,000, $1,240,000 and $1,466,000 at September 30,
1994, 1995 and 1996 and March 31, 1997, respectively. The provision charged to
bad debt expense, which is included in general and administrative expenses, was
$6,000, $939,000 and $399,000 for fiscal 1994, 1995 and 1996, respectively, and
was $611,000 for the six months ended March 31, 1997. Write-offs against the
allowance were $458,000, $46,000 and $785,000 for fiscal 1994, 1995 and 1996,
respectively, and were $385,000 for the six months ended March 31, 1997.

F-10
<PAGE>

MAPICS, INC.

Notes to Combined Financial Statements -- (Continued)

(4) PROPERTY AND EQUIPMENT

Property and equipment consist of the following (in thousands):

<TABLE>
<CAPTION>
September 30, March 31,
--------------------------- -----------
1995 1996 1997
<S> <C> <C> <C>
Furniture and fixtures ........................ $ 99 $ 106 $ 138
Computer equipment .............................. 3,101 5,285 5,710
Leasehold improvements ........................ 25 25 49
--------- --------- ---------
3,225 5,416 5,897
Accumulated depreciation and amortization ...... (1,470) (2,424) (3,084)
--------- --------- ---------
$ 1,755 $ 2,992 $ 2,813
========= ========= =========
</TABLE>

(5) COMPUTER SOFTWARE COSTS

Computer software costs capitalized during fiscal years 1994, 1995 and
1996 amounted to $4,795,000, $5,516,000 and $6,358,000, respectively, and
during the six months ended March 31, 1997, amounted to $2,385,000.
Amortization of computer software costs during those periods was approximately
$1,553,000, $2,448,000, $3,148,000, and $2,070,000, respectively. These
combined financial statements reflect a reduction of $1,050,000 in net
capitalized software costs at September 30, 1995 as a result of purchase
accounting adjustments described in Note 13 and reflect the reclassification of
$279,000 of capitalized software costs to other assets in the six months ended
March 31, 1997. Accumulated amortization at September 30, 1995, September 30,
1996 and March 31, 1997 totaled $2,754,000, $5,902,000 and $7,972,000,
respectively.

(6) ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

Accrued expenses and other current liabilities consist of the following
(in thousands):

<TABLE>
<CAPTION>
September 30, March 31,
--------------------- ----------
1995 1996 1997
<S> <C> <C> <C>
Accrued commissions and royalties ......... $ 5,949 $ 5,556 $ 7,077
Accrued payroll and related expenses ...... 274 1,642 1,632
Accrued sales and other taxes ............ 407 530 722
Other .................................... 4,043 3,729 1,984
-------- -------- --------
$10,673 $11,457 $11,415
======== ======== ========
</TABLE>

F-11
<PAGE>

MAPICS, INC.

Notes to Combined Financial Statements -- (Continued)

(7) OTHER INTANGIBLE ASSETS

Other intangible assets consist of the following (in thousands):

<TABLE>
<CAPTION>
September 30, March 31,
--------------------------- -----------
1995 1996 1997
<S> <C> <C> <C>
Installed customer base and affiliate network ...... $ 6,034 $ 6,034 $ 6,034
Trade names and trademarks ........................ 1,712 1,712 1,712
Goodwill .......................................... 286 286 286
--------- --------- ---------
8,032 8,032 8,032
Accumulated amortization ........................... (2,067) (2,707) (2,965)
--------- --------- ---------
$ 5,965 $ 5,325 $ 5,067
========= ========= =========
</TABLE>

(8) INCOME TAXES

The components of the provision for income taxes are as follows (in
thousands):

<TABLE>
<CAPTION>
Six months
ended
Years ended September 30, March 31,
------------------------------ ----------------
1994 1995 1996 1997
<S> <C> <C> <C> <C>
Federal:
Current ...... $2,742 $4,743 $5,547 $ 3,527
Deferred ...... 978 653 610 (434)
------- ------- ------- -------
Total ......... 3,720 5,396 6,157 3,093
------- ------- ------- -------
State:
Current ...... 736 1,398 1,415 745
Deferred ...... 131 84 78 (56)
------- ------- ------- -------
Total ......... 867 1,482 1,493 689
------- ------- ------- -------
Foreign:
Current ...... 54 234 426 289
Deferred ...... -- -- -- --
------- ------- ------- -------
Total ......... 54 234 426 289
------- ------- ------- -------
Total ......... $4,641 $7,112 $8,076 $ 4,071
======= ======= ======= =======
</TABLE>

F-12
<PAGE>

MAPICS, INC.

Notes to Combined Financial Statements -- (Continued)

The components of income from domestic and foreign operations before
provision for income taxes are as follows (in thousands):

<TABLE>
<CAPTION>
Six months
ended
Years ended September 30, March 31,
--------------------------------- ------------
1994 1995 1996 1997
<S> <C> <C> <C> <C>
Domestic ...... $14,760 $18,137 $20,766 $10,274
Foreign ...... 48 309 210 298
-------- -------- -------- --------
Total ......... $14,808 $18,446 $20,976 $10,572
======== ======== ======== ========
</TABLE>

The effective income tax rates of 31.3%, 38.6% and 38.5% for the years
ended September 30, 1994, 1995 and 1996, respectively, and 38.5% for the six
months ended March 31, 1997, differ from the expected income taxes for those
periods calculated by applying the federal statutory rate of 35.0% to income
before income taxes for the years ended September 30, 1994, 1995 and 1996 and
the six months ended March 31, 1997 as follows (in thousands):

<TABLE>
<CAPTION>
Six months
ended
Years ended September 30, March 31,
--------------------------------------- ------------
1994 1995 1996 1997
<S> <C> <C> <C> <C>
Expected tax .............................. $ 5,183 $ 6,456 $ 7,342 $ 3,701
Benefit of net operating losses ............ (169) -- -- --
State taxes, net ........................... 610 992 998 429
Research and experimentation credits ...... (737) (423) (413) (159)
Other .................................... (246) 87 149 100
------- ------- ------- -------
$ 4,641 $ 7,112 $ 8,076 $ 4,071
======= ======= ======= =======
</TABLE>

Temporary differences between the financial statement carrying amounts and
tax bases of assets and liabilities that give rise to significant portions of
the net deferred income tax liability at September 30, 1995 and 1996 and March
31, 1997 relate to the following (in thousands):

<TABLE>
<CAPTION>
September 30, March 31,
--------------------------- -------------
1995 1996 1997
<S> <C> <C> <C>
Deferred tax assets:
Deferred revenue ..................... $ 334 $ 411 $ 451
Allowance for doubtful accounts ...... 469 229 450
Intangible assets ..................... 71 -- --
Other ................................. 41 267 718
--------- --------- ---------
Total deferred tax assets ............ 915 907 1,619
--------- --------- ---------
Deferred tax liabilities:
Capitalized software .................. (1,044) (1,034) (867)
Intangible assets ..................... -- (737) (1,143)
Other ................................. (67) (20) (3)
--------- --------- ---------
Total deferred tax liabilities ...... (1,111) (1,791) (2,013)
--------- --------- ---------
Net deferred tax liabilities ......... $ (196) $ (884) $ (394)
========= ========= =========
</TABLE>

F-13
<PAGE>

MAPICS, INC.

Notes to Combined Financial Statements -- (Continued)

In assessing the realizability of deferred tax assets, management
considers whether it is more likely than not that some or all of the deferred
tax assets will not be realized. As a result of its evaluation, management has
recorded no valuation allowance.

Pursuant to the anticipated Tax Sharing Agreement between Marcam
Corporation and Marcam Solutions and upon the effectiveness of the
Distribution, MAPICS will become entitled to utilize certain tax attributes of
Marcam Corporation. As of September 30, 1996, those attributes include net
operating loss carryforwards of approximately $42 million, foreign tax credit
carryforwards of approximately $4 million and research and experimentation
credit carryforwards of approximately $3 million. Such carryforwards expire
between 1997 and 2012. The utilization of net operating loss carryforwards will
be limited on an annual basis due to changes in ownership of Marcam
Corporation. Management does not believe that this limitation will have a
significant impact on the amount of taxes to be paid in the future.

(9) COMMITMENTS AND CONTINGENCIES

Lease Commitments
MAPICS leases certain equipment and office space under noncancelable
agreements and leases which expire at various dates through 2001. Future
minimum lease payments under noncancelable operating leases at September 30,
1996 were as follows (in thousands):

<TABLE>
<CAPTION>
Year ending September 30:
<S> <C>
1997 ........................... $1,161
1998 ........................... 584
1999 ........................... 166
2000 ........................... 11
2001 ........................... 5
-------
Total minimum lease payments ...... $1,927
=======
</TABLE>

Total rental expense charged to operations was $926,000, $1,033,000 and
$1,133,000 for fiscal years 1994, 1995 and 1996, respectively, and $533,000 for
the six months ended March 31, 1997.

Litigation
MAPICS is subject to legal proceedings and claims which arise in the
normal course of business. While the outcome of these matters cannot be
predicted with certainty, management does not believe the outcome of any of
these legal matters will have a material adverse effect on the financial
position or results of operations of MAPICS.

MAPICS will be indemnified for future claims arising from Marcam
Corporation's PRISM, Protean and Avantis product lines and related activities
in accordance with the agreements to be entered into with Marcam Solutions as
described in Note 15.

F-14
<PAGE>

MAPICS, INC.

Notes to Combined Financial Statements -- (Continued)

(10) EMPLOYEE STOCK OPTION PLANS

Under Marcam Corporation's stock plans, certain employees and officers
have been granted incentive stock options and non-qualified stock options. At
September 30, 1996, options for the purchase of 2,109,000 shares of Marcam
Corporation common stock were outstanding, of which options for 623,000 shares
were exercisable, with option prices ranging from $1.00 to $29.25 per share. Of
those options, MAPICS employees held 213,000, of which 96,000 shares were
exercisable, with option prices ranging from $1.50 to $22.50 per share. At
March 31, 1997, options for the purchase of approximately 2,664,000 shares of
Marcam Corporation common stock were outstanding, of which options for 874,000
shares were exercisable, with option prices ranging from $1.00 to $29.25 per
share. Of those options, MAPICS employees held approximately 357,000, of which
124,000 shares were exercisable, with option prices ranging from $1.50 to
$22.50 per share.

Promptly following the Distribution, outstanding awards under the Marcam
Corporation stock plans held by Marcam Corporation employees will be adjusted
so as to represent two separately exercisable options--one to purchase common
stock of MAPICS and one to purchase common stock of Marcam Solutions. Each of
the two options will have the same ratio of the exercise price per option to
the market value per share, the same vesting provisions, option periods and
other terms and conditions and, in aggregate, the same difference between
market value and exercise price as reflected in the original Marcam Corporation
option.

(11) EMPLOYEE BENEFIT PLAN

Certain employees of MAPICS in the United States are eligible to
participate in Marcam Corporation's sponsored profit sharing retirement plan
established under the provisions of Internal Revenue Code Section 401(k). The
expenses of MAPICS related to this plan which are included in the statements of
operations amounted to $0, $77,000 and $110,000 for the fiscal years ended
September 30, 1994, 1995, and 1996, respectively, and $85,000 for the six-month
period ended March 31, 1997.

(12) MAJOR CUSTOMERS AND GEOGRAPHIC INFORMATION

MAPICS had no customers which accounted for 10% or more of total revenues
in fiscal years 1995 and 1996 or in the six months ended March 31, 1996 and
1997. In fiscal 1994, International Business Machines Corporation accounted for
12% of total revenues (See Note 14.)

MAPICS markets its products worldwide. Revenues are grouped into three
main geographic segments: U.S., Europe and All Other. Financial data by
geographic area is as follows (in thousands):

F-15
<PAGE>

MAPICS, INC.

Notes to Combined Financial Statements -- (Continued)

<TABLE>
<CAPTION>
U.S. Europe All Other Elimination Total
--------- --------- ----------- ------------- --------
<S> <C> <C> <C> <C> <C>
Fiscal year 1994
- ----------------------------------------------
Net sales to unaffiliated customers ...... $41,210 $ 5,273 $6,300 $ -- $52,783
Transfers between geographic areas ...... 965 -- -- (965) --
-------- -------- ------- -------- --------
Total revenues ........................... 42,175 5,273 6,300 (965) 52,783
-------- -------- ------- -------- --------
Net income .............................. 5,356 1,375 1,608 1,828 10,167
Identifiable assets ..................... 32,041 3,489 862 -- 36,392
Fiscal year 1995
- ----------------------------------------------
Net sales to unaffiliated customers ...... $50,934 $10,419 $7,945 $ -- $69,298
Transfers between geographic areas ...... 1,538 -- -- (1,538) --
-------- -------- ------- -------- --------
Total revenues ........................... 52,472 10,419 7,945 (1,538) 69,298
-------- -------- ------- -------- --------
Net income (loss) ........................ 9,669 458 2,623 (1,416) 11,334
Identifiable assets ..................... 34,765 4,841 1,620 -- 41,226
Fiscal year 1996
- ----------------------------------------------
Net sales to unaffiliated customers ...... $56,546 $14,311 $6,745 $ -- $77,602
Transfers between geographic areas ......... 1,816 -- -- (1,816) --
-------- -------- ------- -------- --------
Total revenues ........................... 58,362 14,311 6,745 (1,816) 77,602
-------- -------- ------- -------- --------
Net income (loss) ........................ 10,058 2,197 938 (293) 12,900
Identifiable assets ........................ 37,876 4,789 2,740 -- 45,405
Six months ended March 31,1997
- ----------------------------------------------
Net sales to unaffiliated customers ...... $32,450 $ 9,447 $2,268 $ -- $44,165
Transfers between geographic areas ...... 1,114 -- -- (1,114) --
-------- -------- ------- -------- --------
Total revenues ........................... 33,564 9,447 2,268 (1,114) 44,165
-------- -------- ------- -------- --------
Net income (loss) ........................ 5,641 702 255 (97) 6,501
Identifiable assets ..................... 37,459 5,156 4,031 -- 46,646
</TABLE>

(13) RELATIONSHIP WITH MARCAM CORPORATION

An allocation of corporate marketing expenses, corporate product
development expenses, and corporate administrative functions (including data
services, employee benefits, legal, insurance, accounting and other corporate
overhead) has been included in the selling and marketing, product development,
and general and administrative operating expenses in the combined statements of
operations and is presented in the following table. Certain general and
administrative and selling and marketing expenses, which were specifically
identified by product line in fiscal 1995 and 1996, were not directly
identified by product line or function in fiscal 1994. Management has estimated
those fiscal 1994 expenses attributable to the MAPICS-related business, and has
presented those expenses as corporate allocations in the following table.

The amounts allocated to MAPICS in each of the periods presented are as
follows (in thousands):

<TABLE>
<CAPTION>
Six months ended
Years ended September 30, March 31,
------------------------------ ----------------------
1994 1995 1996 1996 1997
(unaudited)
<S> <C> <C> <C> <C> <C>
Selling and marketing ............ $5,219 $ 223 $ 213 $ 102 134
Product development ............ 207 221 239 117 --
General and administrative ...... 2,794 2,030 2,412 1,204 1,415
</TABLE>

F-16
<PAGE>

MAPICS, INC.

Notes to Combined Financial Statements -- (Continued)

Net transfers to Marcam Corporation, included in divisional equity,
includes net cash transfers to Marcam Corporation, amounts due to Marcam
Corporation for services and other charges, and income taxes paid on behalf of
MAPICS by Marcam Corporation. No interest has been charged to MAPICS related to
these transactions or to any debt held by Marcam Corporation. The weighted
average balance due to (from) Marcam Corporation was $16,901,000, $1,261,000,
$(14,806,000) and $(25,638,000) for the years ended September 30, 1994, 1995
and 1996 and for the six months ended March 31, 1997, respectively. The
activity in the net transfers to Marcam Corporation account, included in
divisional equity, is summarized below.

<TABLE>
<CAPTION>
Six months
ended
Years ended September 30, March 31,
------------------------------------------- ------------
1994 1995 1996 1997
<S> <C> <C> <C> <C>
Marcam Corporation services and other charges ...... $ 8,220 $ 2,474 $ 2,864 $ 1,549
Domestic and foreign income taxes .................. 4,641 7,112 8,076 4,071
Non-cash purchase accounting adjustments ............ -- (450) -- --
Cash transfers, net ................................. (27,208) (26,069) (26,139) (12,086)
--------- --------- --------- ----------
Net transfers to Marcam Corporation ............... $ (14,347) $(16,933) $ (15,199) $ (6,466)
========= ========= ========= ==========
</TABLE>

On February 26, 1993, Marcam Corporation acquired the exclusive worldwide
marketing rights to the MAPICS product line for 25 years. Marcam Corporation
also acquired the option to purchase the MAPICS product line and certain
related intellectual property rights. As part of the acquisition of the
marketing rights, Marcam Corporation expensed $5,568,000 of in-process research
and development costs and recorded $10,699,000 of intangible assets acquired.
These amounts have been reflected in the combined financial statements of
MAPICS.

On September 29, 1995, Marcam Corporation acquired all of the outstanding
stock of the company which owned the MAPICS product line. As part of the
acquisition, certain non-cash balance sheet adjustments were recorded by Marcam
Corporation which have been reflected in the combined financial statements of
MAPICS. The adjustments consist of the following (in thousands):

<TABLE>
<S> <C>
Reduction of net computer software costs $ 1,050
Reduction of payables ..................... (1,500)
---------
Net adjustment ........................... $ (450)
=========
</TABLE>

(14) RELATED PARTY TRANSACTIONS

MAPICS has a number of marketing and product development relationships
with International Business Machines Corporation ("IBM"). IBM has purchased
licenses for MAPICS products for internal use, as well as for marketing
purposes. MAPICS has purchased certain services, equipment and software
licenses from IBM.

Under various agreements with MAPICS and its representatives, IBM markets
MAPICS products in cooperation with MAPICS and its subsidiaries or
representatives in several countries. In each case, MAPICS or its
representative pays IBM a fee for marketing MAPICS products when a sale is made
with IBM's assistance. The fee is calculated as a percentage of the license
fees received by MAPICS and varies based on the agreement's specific
territories. MAPICS paid IBM aggregate fees of $1,453,000, $198,000 and $0 in
fiscal years 1994, 1995 and 1996, respectively, and $0 in the six-month period
ended March 31, 1997.

MAPICS recorded royalties from IBM of approximately $5,675,000, $2,614,000
and $604,000 in fiscal years 1994, 1995 and 1996, respectively, and $265,000,
in the six-month period ended March 31, 1997 relating to sales of MAPICS
products.

MAPICS also licenses products and provides services to IBM in the ordinary
course of business. During fiscal years 1994, 1995 and 1996, MAPICS recognized
an aggregate of approximately $700,000, $185,000 and $409,000,

F-17
<PAGE>

MAPICS, INC.

Notes to Combined Financial Statements -- (Continued)

respectively, and during the six-month period ended March 31, 1997 recognized
$236,000 from licensing products and providing services to IBM. IBM also sells
products and provides services, including distribution and translation
services, to MAPICS in the ordinary course of business.

Total revenues that were derived from transactions with IBM were
$6,375,000, $2,799,000 and $1,013,000 for fiscal 1994, 1995 and 1996,
respectively, and $501,000 for the six-month period ended March 31, 1997.

(15) SUBSEQUENT EVENTS (Unaudited)

Agreements with Marcam Solutions

Distribution Agreement. Prior to the completion of the Distribution which
occurred on July 29, 1997, Marcam Corporation (renamed MAPICS) and Marcam
Solutions entered into a Distribution Agreement. Pursuant to the Distribution
Agreement, subject to limited exceptions, the two companies are required to
indemnify each other and each other's directors, officers, employees, agents and
representatives for liabilities under federal or state securities laws that are
a result of the offering and the Distribution. The Distribution Agreement also
provides that each party thereto will indemnify the other party thereto and its
directors, officers, employees, agents and representatives for liabilities that
may be incurred by the indemnified party relating to, resulting from or arising
out of (i) the business, operations or assets conducted or owned or formerly
conducted or owned by the indemnifying party and its subsidiaries, or (ii) the
failure by the indemnifying party to comply with any other agreements executed
in connection with the Distribution or the offering. In addition, the
Distribution Agreement provides that each will indemnify the other party and its
directors, officers, employees, agents and representatives for any liabilities
resulting from or arising out of certain acts, failures to act or the provision
of incorrect factual information by the indemnifying party in connection with
the IRS private letter ruling request that cause the Distribution to be taxable
to the indemnified party or its stockholders. The ancillary agreements executed
in connection with the Distribution included a General Services Agreement and a
Tax Sharing Agreement. With respect to matters governed by the General Services
Agreement, the relationship between MAPICS and Marcam Solutions is intended to
continue in a manner generally consistent with past practices. Management
believes that the expected charges in accordance with these agreements are fair
and reasonable.

General Services Agreement. The General Services Agreement provides
that Marcam Solutions and MAPICS will provide to each other from time to time,
upon request, certain routine and ordinary corporate services, including
financial, accounting, administrative, tax, and legal services. For these
services, the party providing such services will be reimbursed for its costs,
including the pro rata costs of its employees performing such services and
allocable overhead, on a per diem basis.

Tax Sharing Agreement. Prior to completion of the Distribution, Marcam
Corporation (renamed MAPICS) and Marcam Solutions entered into a Tax Sharing
Agreement that defines the parties rights and obligations with respect to
certain tax liabilities and refunds of taxes relating to Marcam Corporation's
business for periods ending on or prior to the date of the Distribution. In
general, pursuant to the Tax Sharing Agreement, Marcam Solutions shall be
responsible for certain state, local and foreign taxes for periods ending on or
before the date of the Distribution (and shall be entitled to refunds with
respect to such taxes), and MAPICS shall be responsible for all other taxes for
such periods (and shall be entitled to refunds with respect to such taxes). In
addition, under the Tax Sharing Agreement, MAPICS shall be liable for any taxes
arising out of the Distribution. The Tax Sharing Agreement further provides for
cooperation with respect to certain tax matters, the exchange of information and
the retention of records.

Debt Financing/Pro Forma Balance Sheet Presentation
On July 25, 1997, Marcam Corporation borrowed $64 million (the "Debt
Financing"). The net proceeds of this financing were used to make the $39
million cash transfer by Marcam Corporation (renamed MAPICS) to Marcam
Solutions in connection with the Distribution and to repay Marcam Corporation's
$25 million 9.82% Subordinated Notes due 2001 (assumed by MAPICS for accounting
purposes). The indebtedness incurred in the Debt Financing

F-18
<PAGE>

MAPICS, INC.

Notes to Combined Financial Statements -- (Continued)

was assumed by MAPICS for accounting purposes and currently bears interest at
the rate of 9%, is payable on August 4, 1997 and is secured by liens on
substantially all of MAPICS' assets. This indebtedness is expected to be repaid
in part with proceeds from the proposed offering of MAPICS common stock
(the "Offering").

The accompanying pro forma unaudited combined balance sheet as of March 31,
1997 gives effect to the $64 million indebtedness incurred in Debt Financing,
the capital contribution of $39 million by MAPICS to Marcam Solutions, and the
repayment of Marcam Corporation's $25 million 9.82% Subordinated Notes due 2001,
each occurring on July 25, 1997.

Revolving Credit and Term Loan Facility
MAPICS is currently negotiating a $30 million senior secured revolving
credit and term loan facility. Under this proposed facility, MAPICS will borrow
up to $15 million as a term loan and up to $15 million under the revolving
credit facility. MAPICS intends to use borrowings under this proposed credit
facility to repay any amounts borrowed in the Debt Financing which are not
repaid with the net proceeds from the Offering and for general corporate
purposes, including working capital. MAPICS' obligations under the proposed
credit facility will be secured by liens on substantially all of its assets. The
principal of the term loan under the proposed credit facility will be payable in
installments beginning on September 30, 1998 and ending on June 30, 2001, and
any revolving credit loans under the credit facility will mature on June 30,
2000. The proposed credit facility will provide for prime and LIBOR based
interest rate options. The borrowing availability for revolving credit loans and
the rate of interest will vary depending upon specified financial ratios. The
proposed credit facility will contain covenants which, among other things, will
require that MAPICS maintain certain financial ratios and will impose certain
limitations or prohibitions on MAPICS with respect to the occurrence of
indebtedness, liens, capital leases; the payment of dividends on, and the
redemption or repurchase of, capital stock of the company; investments and
acquisitions; the merger or consolidation of the company with any person or
entity; and the disposition of any of the company's properties or assets. MAPICS
is also currently negotiating for the borrowing availability under the proposed
senior secured revolving credit and term loan facility to be increased to $75
million, which would permit MAPICS to repay the indebtedness incurred in
the Debt Financing, in the event the Offering is not completed by August 4,
1997. To the extent the proposed credit facility is not consummated on or before
August 4, 1997, MAPICS will be required to seek alternative sources of funds to
repay the indebtedness incurred in the Debt Financing. There can be no assurance
that MAPICS will be able to consummate the proposed credit facility on or before
August 4, 1997 or, in the alternative, that additional financing will be
available or available on terms acceptable to MAPICS. MAPICS' failure to repay
or refinance the indebtedness incurred in the Debt Financing would have a
material adverse effect on the financial condition of MAPICS.

(16) SELECTED QUARTERLY FINANCIAL DATA (Unaudited)

The following quarterly information is unaudited and, in the opinion of
management, includes all adjustments (consisting only of normal recurring
adjustments) necessary to present fairly the operating results for each
quarter.

<TABLE>
<CAPTION>
First Second Third Fourth
Quarter Quarter Quarter Quarter Year
--------- --------- --------- --------- --------
(In thousands)
<S> <C> <C> <C> <C> <C>
1995:
Revenues .............................. $17,213 $15,358 $15,303 $21,424 $69,298
Income before income tax expense ...... 5,744 4,040 3,502 5,160 18,446
Net income ........................... 3,529 2,482 2,152 3,171 11,334
1996:
Revenues .............................. $18,623 $17,221 $18,128 $23,630 $77,602
Income before income tax expense ...... 5,037 4,846 4,594 6,499 20,976
Net income ........................... 3,098 2,980 2,826 3,996 12,900
1997:
Revenues .............................. $23,379 $20,786
Income before income tax expense ...... 5,793 4,779
Net income ........................... 3,563 2,938
</TABLE>

F-19
<PAGE>

MAPICS continually enhances its product offerings to meet the specific needs of
customers and offers customers the opportunity to gradually migrate to new
technologies, one user at a time if desired while protecting their existing
investments in both hardware and software.

Description of inside back-cover page:

[Multicolor computer generated graphic depicting a sample of one of the
Company's proprietary "PDM Plus" graphical user interface computer screens,
showing multiple task, function, editing and customizing selections, simulated
data and representative icons.] A caption at the bottom of the pages reads as
follows: "MAPICS continually enhances its product offerings to meet the
specific needs of customers and offers customers the opportunity to gradually
migrate to new technologies, one user at a time if desired, while protecting
their existing investments in both hardware and software."

[MAPICS LOGO]

<PAGE>

================================================================================
No dealer, salesperson or other person has been authorized to give any
information or to make any representations other than those contained in this
Prospectus and, if given or made, such information or representations must not
be relied upon as having been authorized by the Company or any of the
Underwriters. This Prospectus does not constitute an offer to sell or a
to buy the shares by anyone in any jurisdiction in which such offer or
solicitation is not authorized, or in which the person making the offer or
solicitation is not qualified to do so, or to any person to whom it is unlawful
to make such offer or solicitation. Neither the delivery of this Prospectus nor
any sale made hereunder shall create any implication that the information
contained herein is correct as of any time subsequent to its date.

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

TABLE OF CONTENTS

<TABLE>
<CAPTION>
Page
<S> <C>
Prospectus Summary ........................ 3
Risk Factors .............................. 7
Use of Proceeds ........................... 15
Dividend Policy ........................... 15
Capitalization .............................. 16
Selected Combined Financial Data ............ 17
Management's Discussion and Analysis
of Financial Condition and Results of
Operations .............................. 18
Business .................................... 27
Management ................................. 36
The Distribution ........................... 37
Relationship Between MAPICS and
Marcam Solutions ........................ 40
Principal Stockholders ..................... 41
Description of Capital Stock ............... 42
Underwriting .............................. 45
Legal Matters .............................. 47
Experts .................................... 47
Information Incorporated by Reference ...... 48
Available Information ..................... 48
Index to Combined Financial
Statements .............................. F-1
</TABLE>

6,000,000 Shares

[MAPICS LOGO]

Common Stock

----------------------------------------
P R O S P E C T U S
----------------------------------------

Donaldson, Lufkin & Jenrette
Securities Corporation

Lazard Freres & Co. LLC

Dain Bosworth
Incorporated

July 30, 1997

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