<PAGE>   1
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                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

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

                                    FORM 10-Q
(Mark One)

[X]   Quarterly Report Pursuant to Section 13 or 15(d) of the Securities 
                             Exchange Act of 1934.

                For the quarterly period ended December 31, 1996


[ ]   Transition Report Pursuant to Section 13 or 15(d) of the Securities 
                             Exchange Act of 1934.

                  For the transition period from _____ to_____

                         Commission file number: 0-11778

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

                          SEEQ TECHNOLOGY INCORPORATED
                          ----------------------------
             (Exact name of registrant as specified in its charter)

            Delaware                                  94-2711298
            --------                                  ----------
 (State or other jurisdiction of                   (I.R.S. Employer
 incorporation or organization)                   Identification No.)

                              47200 Bayside Parkway
                            Fremont, California 94538
                                 (510) 226-7400
                  (Address, including zip code, of Registrant's
                    principal executive offices and telephone
                          number, including area code)

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

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

                                                     Yes  X   No
                                                         ---     ---

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

Common Stock, $0.01 par value                      30,288,379
  (Class of common stock)              (Shares outstanding at December 31, 1996)
--------------------------------------------------------------------------------

This report on Form 10-Q, including all exhibits, contains 14 pages.

                                       1
<PAGE>   2
                          SEEQ TECHNOLOGY INCORPORATED

                                    FORM 10-Q

                                Table of Contents



PART I.  FINANCIAL INFORMATION                                              Page

Item 1.  Condensed Financial Statements...................................   3
Item 2.  Management's Discussion and Analysis of Financial 
         Condition and Results of Operations..............................   8



PART II. OTHER INFORMATION

Item 1.  Legal Proceedings................................................   12
Item 2.  Changes in Securities............................................   12
Item 3.  Defaults upon Senior Securities..................................   13
Item 4.  Submission of Matters to a Vote of Security Holders..............   13
Item 5.  Other Information................................................   13
Item 6.  Exhibits and Reports on Form 8-K.................................   13



                                       2


<PAGE>   3
This Quarterly Report of Form 10-Q may contain forward-looking statements that
involve risks and uncertainties. The Company's actual results may differ
materially from the results discussed in any such forward-looking statements.
Factors that might cause such a difference include, but are not limited to,
those discussed under the captions "Legal Proceedings" and "Factors Affecting
Operating Results" contained herein and under the caption "Business Risks" in
the Company's fiscal 1996 annual report on Form 10-K.

PART I.  FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS


                          SEEQ TECHNOLOGY INCORPORATED
                       CONDENSED STATEMENTS OF OPERATIONS
                    (In thousands, except per share amounts)
                                   (Unaudited)


<TABLE>
<CAPTION>
                                                       Three months ended
                                                   -------------------------
                                                   December 31,  December 31,
                                                      1996          1995
                                                    --------      --------
<S>                                                 <C>           <C>     
Net revenues                                        $  6,624      $  4,801
Cost of revenues                                       4,560         3,487
                                                    --------      --------

Gross profit                                           2,064         1,314
                                                    --------      --------

Operating expenses
         Research and development                        780           786
         Marketing, general and administrative         1,252           921
                                                    --------      --------
Total operating expenses                               2,032         1,707
                                                    --------      --------

Income (loss) from operations                             32          (393)
Interest and other, net                                    3           100
                                                    --------      --------
Income (loss) before income taxes                         35          (293)
Provision for income taxes                                 1          --
                                                    --------      --------

Net income (loss)                                   $     34      $   (293)
                                                    ========      ========

Net income (loss) per share:                        $   --        $  (0.01)

Shares used in per share calculation:                 31,885        29,873
</TABLE>




See accompanying notes to condensed financial statements.



                                       3
<PAGE>   4
                          SEEQ TECHNOLOGY INCORPORATED
                            CONDENSED BALANCE SHEETS
                                 (In thousands)
                                   (Unaudited)


<TABLE>
<CAPTION>
                                                       December 31, September 30,
                                                           1996         1996
                                                         -------      -------
<S>                                                      <C>          <C>    
ASSETS
Current assets:
Cash and cash equivalents                                $ 4,642      $ 3,974
Accounts receivable, less allowances                       3,628        8,235
Inventories                                                5,145        5,352
Other current assets                                         201          368
                                                         -------      -------
         Total current assets                             13,616       17,929

Property and equipment, net                                3,998        4,258
Other assets                                               4,300        4,248
                                                         -------      -------
         Total assets                                    $21,914      $26,435
                                                         =======      =======

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable                                         $ 2,167      $ 6,271
Accrued salaries, wages and employee benefits                442          586
Other accrued liabilities                                    905        1,024
Current portion of long-term obligations                     857          895
                                                         -------      -------
         Total current liabilities                         4,371        8,776

Long-term obligations                                      3,234        3,466

Stockholders' equity:                                     14,309       14,193

                                                         -------      -------
         Total liabilities and stockholders' equity      $21,914      $26,435
                                                         =======      =======
</TABLE>




See accompanying notes to condensed financial statements.



                                       4
<PAGE>   5
                          SEEQ TECHNOLOGY INCORPORATED
                       CONDENSED STATEMENTS OF CASH FLOWS
                                 (In thousands)
                                   (Unaudited)


<TABLE>
<CAPTION>
                                                               Three months ended
                                                             ---------------------
                                                             Dec. 31,      Dec. 31,
                                                               1996         1995
                                                             -------       -------
<S>                                                          <C>           <C>     
OPERATING ACTIVITIES:
Net income/(loss)                                            $    34       $  (293)
Adjustments to reconcile net income:
         Depreciation and amortization                           421           184
Changes in assets and liabilities:
           Accounts receivable                                 4,607            40
           Inventories                                           207          (316)
           Prepaid expenses and other assets                       9          (407)
           Accounts payable                                   (4,104)          634
           Accrued liabilities and long term obligations        (295)         (508)
                                                             -------       -------
Net cash provided by (used for) operating activities             879          (666)
                                                             -------       -------

INVESTING ACTIVITIES:
Capital expenditures                                             (55)         (131)
Short-term investments in restricted account                    --           3,000
                                                             -------       -------
Net cash provided by (used for) investing activities             (55)        2,869
                                                             -------       -------

FINANCING ACTIVITIES:
Payments on short term borrowings                               --          (3,000)
Payments of capital lease obligations                           (238)          (81)
Proceeds from issuance of stock                                   82           308
                                                             -------       -------
Net cash used for financing activities                          (156)       (2,773)
                                                             -------       -------

Net increase (decrease) in cash and cash equivalents             668          (570)
Cash and cash equivalents at beginning of period               3,974         3,682
                                                             -------       -------
Cash and cash equivalents at end of period                   $ 4,642       $ 3,112
                                                             =======       =======

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for interest                     $    83       $   104

SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING ACTIVITY:
Capital lease obligations incurred for the acquisition
    of equipment                                             $  --         $   127
</TABLE>




See notes to condensed financial statements.


                                       5
<PAGE>   6
                          SEEQ TECHNOLOGY INCORPORATED
                     NOTES TO CONDENSED FINANCIAL STATEMENTS
                                   (UNAUDITED)


NOTE 1. BASIS OF PRESENTATION

           The accompanying unaudited condensed financial statements of SEEQ
Technology Incorporated ("SEEQ" or the "Company") have been prepared in
accordance with generally accepted accounting principles for interim financial
information and with the rules and regulations of the Securities and Exchange
Commission. Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements and should be read in conjunction with the financial
statements and the notes thereto included in the Company's Annual Report to
Stockholders for the fiscal year ended September 30, 1996. These financial
statements reflect, in the opinion of management, all adjustments (which include
only normal recurring adjustments, except for those adjustments related to
certain restructuring and other expenses) necessary to present fairly the
financial position and results of operations as of and for the periods
indicated.

           The results of operations for the three months ended December 31,
1996 are not necessarily indicative of the results expected for the year ending
September 30, 1997.

           For purposes of presentation, the Company has shown its fiscal
quarters as ending on December 31, March 31, June 30 and September 30; whereas,
in fact, the Company operates on a 52/53- week fiscal year ending on the last
Sunday in September of each year. The fiscal quarter ends are actually December
29, March 30, June 29 and September 28 for the year ending September 30, 1997
and December 31, March 31, June 30, and September 29 for the year ending
September 30, 1996.


NOTE 2. INVENTORIES

           Inventories were comprised of the following:

<TABLE>
<CAPTION>
                                 Dec. 31,    Sep. 30,
                                   1996        1996
                                  ------      ------
                                   (in thousands)

         <S>                      <C>         <C>   
         Raw materials            $    5      $   22
         Work in process           1,576       3,147
         Finished goods            3,564       2,183
                                  ------      ------
                                  $5,145      $5,352
                                  ======      ======
</TABLE>
                         
NOTE 3. NON-RECURRING PRODUCTION TRANSFER COSTS

           Non-recurring costs such as tooling and engineering costs resulting
from transferring production of current product to new foundries are capitalized
and amortized to cost of revenues over the shorter of: the remaining life of the
product, the term of the foundry agreement or two years. Non-recurring costs
which are associated with the development of new products are expensed as
research and development costs when incurred. During the three month periods
ended December 31, 1996 and December 31, 1995 the Company capitalized $111,000
and $349,000 of non-recurring production transfer costs, respectively. The
amortization of these costs for the three month periods ended December 31, 1996
and December 31, 1995 were $106,000 and $17,000, respectively.



                                       6
<PAGE>   7
NOTE 4. NET INCOME (LOSS) PER SHARE

           Primary and fully diluted net income (loss) per share for the three
month periods ended December 31, 1996 and December 31, 1995 were determined
using the treasury stock method. Net income (loss) per common and common
equivalent share is computed using the weighted average number of shares
outstanding during the respective periods, including dilutive stock options and
warrants.

NOTE 5. LITIGATION

           On March 30, 1994, the Company filed a lawsuit against HMC in which,
among other things, the Company sought a declaration by the court that an
alleged license agreement, pursuant to which HMC had allegedly been granted
certain license rights to the EEPROM technology sold to Atmel, is invalid. In
response to the Company's claims, HMC asserted affirmative defenses and
counterclaims. On August 16, 1995, the Company and HMC entered into a Settlement
Agreement, Release and Tolling Agreement. Under the terms of such Agreement, the
Company agreed, among other things, that the claims asserted against HMC in
respect of the alleged license agreement would be tolled for such time and on
such terms as provided therein. As a result, the Company is not currently
pursuing such claims. The Company is entitled to pursue such claims in the
future, however, subject to the terms of the Settlement Agreement, Release and
Tolling Agreement. In the event that the Company does not cause the alleged
license agreement to be invalidated, Atmel may assert a claim against the
Company under the Asset Purchase Agreement, including a claim for damages, if
suffered by Atmel as a result of HMC's use of any of such technology, and, in
the event any such claim by Atmel is determined to be valid, Atmel may recover
any such damages. The Company believes that, in the event of any claim by Atmel,
the amount of damages that may be payable by the Company upon a resolution
thereof will not have a material adverse effect on the Company's cash flow,
financial position or results of operations. However, there can be no assurance
as to such matters. Under the terms of the settlement, the Company agreed to pay
HMC $500,000 due in three consecutive monthly installments beginning in August
1995. The Company further agreed to issue to HMC 100,000 shares of SEEQ's common
stock and reactivate and modify the 1990 Foundry and Co-Development Agreement.


           On November 28, 1995, Level One Communications Incorporated ("Level
One") filed a complaint against the Company, in the United States District Court
of Northern California, alleging patent infringement. In the complaint, Level
One claims that the Company has used and sold products in violation of two of
Level One's patents. Level One seeks immediate and permanent injunctive relief
preventing the Company from making, using, or selling any devices that infringe
such patents and unspecified damages. The Company intends to vigorously contest
all of Level One's claims. Based on the Company's review to date, management
believes that the claims asserted by Level One are without merit and that the
outcome of these legal proceedings will not have a material adverse effect on
the Company's financial position or results of operations, although there can be
no assurance as to such matters. Patent litigation is often highly complex, can
extend for a protracted period of time, can involve substantial cost to the
Company and may divert the attention of the Company's management and technical
personnel, which can substantially increase the cost of such litigation. There
can be no assurance that such costs and diversion of resources would not have a
material adverse effect on the Company's business, financial condition and
results of operations.

           On June 25, 1996, Praxair, Inc. ("Praxair") filed a complaint against
the Company arising out of a nitrogen supply contract between the Company and
the plaintiff. The Complaint purports to state causes of action for breach of
contract and promissory estoppel. The Complaint alleges that as a result of
purported breaches of the nitrogen supply contract, the Company is obligated to
pay plaintiff approximately $1,300,000 plus cost of suit, not including
attorney's fees. The Company intends to contest all of Praxair's claims
vigorously. Based on the Company's limited review to date, management believes
that the claims asserted by Praxair are without merit. However, there can be no
assurance that Praxair will not obtain a favorable result in the lawsuit which
could have a material adverse effect on the Company's business, financial
condition and results of operations.



                                       7
<PAGE>   8
ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
           RESULTS OF OPERATIONS


           The following discussion should be read in conjunction with the
Interim Condensed Financial Statements and Notes thereto and the SEEQ Technology
Incorporated Annual Report and Form 10-K for the fiscal year ended September 30,
1996.

           This Quarterly Report of Form 10-Q may contain forward-looking
statements that involve risks and uncertainties. The Company's actual results
may differ materially from the results discussed in any such forward-looking
statements. Factors that might cause such a difference include, but are not
limited to, those discussed under the captions "Legal Proceedings" and "Factors
Affecting Operating Results" contained herein and under the caption "Business
Risks" in the Company's fiscal 1996 annual report on Form 10-K.


RESULTS OF OPERATIONS

           Revenues

           Net revenues were $6,624,000 in the first quarter of fiscal 1997,
representing an increase of $1,823,000 or 38% over net revenues of $4,801,000
for the first quarter of fiscal 1996. During the first quarter of fiscal 1996,
production volumes were not sufficient to meet demand due primarily to issues
relating to the transfer of products to new foundries. During the first quarter
of fiscal 1997, the Company was obtaining adequate levels of product from its
foundries and experienced demand for its' Fast Ethernet products. Products
supporting the Fast Ethernet (100Mbps) market accounted for approximately 43% of
net revenues for the first quarter of fiscal 1997 compared to approximately 6%
in the first quarter of fiscal 1996. Three customers, Bay Networks, Serial
Systems and Solectron accounted for approximately 18%, 11% and 10% of revenues
in the quarter ended December 31, 1996, respectively. Serial Systems and
Solectron accounted for approximately 14% and 10% of revenues for the three
months ended December 31, 1995, respectively. No other customer accounted for
more than 10% of revenues for the three month periods ended December 31, 1996
and December 31, 1995.

           Gross Product Margins

           The Company includes in cost of revenues all costs associated with
subcontractor manufacturing, electrical testing, subcontractor assembly and
final test of its integrated circuits and subsystems, warehousing, shipping,
product returns and reserves for inventory obsolescence. Allowances for product
returns are netted against revenues. Gross profit for the first quarter of
fiscal 1997 was $2,064,000 or 31% of net revenues, an increase of $750,000 over
the first quarter of fiscal 1995's gross profit of $1,314,000 or 27% of net
revenues, primarily attributable to higher revenues and lower production costs.
Gross margins in future periods will be affected primarily by revenue levels and
product mix, average selling prices, wafer yields, the introduction of new
products and changes in manufacturing costs.

           Research and Development

           Research and development expenditures decreased from $786,000 in the
first quarter of fiscal 1996 to $780,000 in the first quarter of fiscal 1997
primarily due to a decrease in tooling costs for new product development and
partially off set by an increase in payroll costs. As a percentage of net
revenues, research and development expenditures decreased from 16% in the first
quarter of fiscal 1996 to 12% in the first quarter of fiscal 1997 due to higher
revenues. The Company expects that the level of research and development
spending will increase in absolute dollars in the next several quarters as a
result of increased development efforts on new LAN products, but may vary as a
percentage of net revenues.



                                       8

<PAGE>   9
           Marketing, General and Administrative Expenses

           Marketing, general and administrative expenses increased from
$921,000 in the first quarter of fiscal 1996 to $1,252,000 in the first quarter
of fiscal 1997, and remained constant as a percentage of revenues at 19% for the
same periods. This dollar increase is primarily attributable to higher
commissions payable to outside sales representatives due to the growth in net
revenues and to increased expenses associated with legal proceedings. The
Company anticipates that the level of marketing, general and administrative
expenses will vary in future periods based on expected revenue growth.

           Interest and other, net

           Interest and other, net decreased from $100,000 in the first quarter
of fiscal 1996 to $3,000 in the first quarter of fiscal 1997. Interest expense
has resulted primarily from borrowings under the Company's credit facility and
from capital lease obligations. Interest expense remained constant at $83,000 in
both the first fiscal quarters of 1996 and 1997, primarily as a result of the
lower average balances of borrowings on the Company's credit facility offset by
increases in interest expense. Interest income decreased from $183,000 in the
first quarter of fiscal 1996 to $86,000 in the first quarter of fiscal 1997,
primarily due to lower cash balances and lower interest rates from investments
of the cash balances in cash, restricted cash and cash held in escrow invested
in short-term investment instruments.

           Income Taxes

           The Company's provision for income taxes is due primarily to expected
alternative minimum state and federal income taxes.

           Factors Affecting Operating Results

           The Company's quarterly operating results have varied significantly
in the past and are likely to vary significantly in the future, depending on a
number of factors, many of which are outside the control of the Company. These
factors include fluctuations in manufacturing yields, the timing of introduction
of new products by the Company and its competitors, changes in the markets
addressed by the Company's products, market acceptance of the Company's and it's
customers' products, the volume and timing of orders received, changes in the
Company's product mix and customer base, the timing and extent of research and
development expenditures, the availability and cost of semiconductor wafers from
outside foundries, product obsolescence, price erosion, competitive factors,
litigation expenses, cyclical semiconductor industry conditions and general
economic conditions. The Company's net revenue and cost of revenues vary
depending upon the mix of products sold. Any unfavorable change in manufacturing
yields or product mix, delays in new product introductions, underutilization of
manufacturing capacity, increased price competition or other factors could have
a material adverse effect on the Company's operating results and financial
condition. Historically, average selling prices in the semiconductor industry
have decreased over the life of any particular product. There can be no
assurance that the average selling prices of the Company's current or future
products will not be subject to significant pricing pressures. In addition, the
Company's business is characterized by short-term orders and shipment schedules,
and customer orders typically can be canceled or rescheduled without significant
penalty to the customer. Due to the absence of significant noncancellable
backlog, the Company typically plans its production and inventory levels based
on internal forecasts of customer demand, which are highly unpredictable and can
fluctuate substantially. In addition, the Company is limited in its ability to
reduce costs quickly in response to any revenue shortfalls, which could have a
material adverse effect on the Company's business, operating results and
financial condition. Due to all of the foregoing factors, it is likely that in
some future quarter the Company's operating results will be below the
expectations of public market analysts and investors. In such event, the price
of the Company's Common Stock would likely be materially adversely affected.

LIQUIDITY AND CAPITAL RESOURCES




                                       9



<PAGE>   10

           The Company has satisfied its cash requirements principally through
cash flow from operations, borrowings under bank lines of credit, capital lease
financing and the public and private sale of securities.

           The Company believes that existing sources of liquidity, anticipated
cash flow from operations, and borrowings under the Company's credit facility
will be adequate to satisfy its cash requirements at least through the end of
fiscal 1997. However, there can be no assurance that the Company will have
adequate resources to satisfy such requirements. It may become necessary for the
Company to raise funds from debt and/or equity financing. There can be no
assurance that such funds will be available on terms acceptable to the Company,
if at all. Issuance of additional equity securities could result in dilution to
stockholders. The inability to fund capital requirements would have a material
adverse effect on the Company's business, financial condition and results of
operations.

           The Company's cash and cash equivalents balance increased from
$3,974,000 as of September 30, 1996 to $4,642,000 as of December 31, 1996,
primarily from cash provided by operating activities, partially offset by
capital expenditures and payments of capital lease obligations.

           Operating Activities

           Cash flows provided by operating activities were $879,000 in the
three months ended December 31, 1996 compared to cash flows used for operating
activities of $666,000 in the three months ended December 31, 1995. This
reflects higher income and collections of accounts receivable, offset in part by
the decrease in accounts payable and other liabilities.

           Investing Activities

           Cash flows provided by investing activities of $2,869,000 during the
first three months of fiscal 1996 includes $3,000,000 from the maturity of short
term investments of restricted cash, the proceeds of which were used to pay off
the Company's short term borrowings. Capital expenditures were $131,000 during
the three month period ended December 31, 1995 and $55,000 for the same period
ended December 31, 1996.

           Financing Activities

           Cash flows used for financing activities were $156,000 in the three
month period ended December 31, 1996 compared to $2,773,000 in the three month
period ended December 31, 1995. During the three month period ended December 31,
1995, the Company paid off short term borrowings of $3,000,000 with restricted
cash. Net proceeds from the issuance of stock pursuant to the exercise of
warrants and stock options and the Company's employee periodic stock purchase
plan was $308,000 for the first three months of fiscal 1995 compared to $82,000
during the first three months of fiscal 1996. Principal payments against capital
lease obligations were $81,000 in the quarter ended December 31, 1995 compared
to $238,000 for the quarter ended December 31, 1996.

           In November 1993, the Company entered into a two-year line of credit
agreement, subject to renewal, with the CIT Group ("CIT"). Although the Company
was not required to make use of the bank line of credit, during the second
quarter of fiscal 1994 it used cash resources to reduce its effective short-term
credit borrowings interest rate by borrowing the minimum required borrowings of
$3,000,000 under a secured bank line of credit with CIT, and investing the
proceeds in a short-term certificate of deposit (restricted cash). Effective
November 22, 1995, the Company renewed the credit facility with CIT for a two
year term. Under the renewed credit agreement, the minimum borrowing requirement
was reduced to $1,500,000 and was only applicable in the event the Company had a
loan balance outstanding with CIT. Thus the Company liquidated its restricted
cash and repaid the note payable to bank in November 1995. The credit agreement
with CIT was terminated by the Company in August 1996.



                                       10
<PAGE>   11
           In August 1996, the Company entered into a one-year revolving line of
credit agreement with Silicon Valley Bank. Under the terms of the bank revolving
line of credit, the Company could borrow the lesser of $7,000,000 or an amount
determined by a formula applied to eligible accounts receivable, at a variable
interest rate equal to the prime rate plus 0.75%. The revolving line of credit
is secured by a security interest in the Company's assets, including
intellectual property and expires August 18, 1997. The loan agreement requires
the Company to maintain a profit each fiscal year and to maintain certain
financial ratios. The loan agreement also requires the Company to maintain a
level of tangible net worth which, in effect, limits the ability of the Company
to make payments of cash dividends. There were no borrowings outstanding under
this revolving line of credit as of December 31, 1996.




                                       11
<PAGE>   12
PART II. OTHER INFORMATION

ITEM 1.    LEGAL PROCEEDINGS

On March 30, 1994, the Company filed a lawsuit against HMC in which, among other
things, the Company sought a declaration by the court that an alleged license
agreement, pursuant to which HMC had allegedly been granted certain license
rights to the EEPROM technology sold to Atmel, is invalid. In response to the
Company's claims, HMC asserted affirmative defenses and counterclaims. On August
16, 1995, the Company and HMC entered into a Settlement Agreement, Release and
Tolling Agreement. Under the terms of such Agreement, the Company agreed, among
other things, that the claims asserted against HMC in respect of the alleged
license agreement would be tolled for such time and on such terms as provided
therein. As a result, the Company is not currently pursuing such claims. The
Company is entitled to pursue such claims in the future, however, subject to the
terms of the Settlement Agreement, Release and Tolling Agreement. In the event
that the Company does not cause the alleged license agreement to be invalidated,
Atmel may assert a claim against the Company under the Asset Purchase Agreement,
including a claim for damages, if suffered by Atmel as a result of HMC's use of
any of such technology, and, in the event any such claim by Atmel is determined
to be valid, Atmel may recover any such damages. The Company believes that, in
the event of any claim by Atmel, the amount of damages that may be payable by
the Company upon a resolution thereof will not have a material adverse effect on
the Company's cash flow, financial position or results of operations. However,
there can be no assurance as to such matters. Under the terms of the settlement,
the Company agreed to pay HMC $500,000 due in three consecutive monthly
installments beginning in August 1995. The Company further agreed to issue to
HMC 100,000 shares of SEEQ's common stock and reactivate and modify the 1990
Foundry and Co-Development Agreement.

On November 28, 1995, Level One Communications Incorporated ("Level One") filed
a complaint against the Company, in the United States District Court of Northern
California, alleging patent infringement. In the complaint, Level One claims
that the Company has used and sold products in violation of two of Level One's
patents. Level One seeks immediate and permanent injunctive relief preventing
the Company from making, using, or selling any devices that infringe such
patents and unspecified damages. The Company intends to vigorously contest all
of Level One's claims. Based on the Company's review to date, management
believes that the claims asserted by Level One are without merit and that the
outcome of these legal proceedings will not have a material adverse effect on
the Company's financial position or results of operations. There can be no
assurance, however, that Level One will not obtain a favorable determination in
judicial proceeding, which could have a material adverse effect on the Company's
business, financial condition and results of operations. Patent litigation is
often highly complex, can extend for a protracted period of time, can involve
substantial cost to the Company and may divert the attention of the Company's
management and technical personnel, which can substantially increase the cost of
such litigation. There can be no assurance that such costs and diversion of
resources would not have a material adverse effect on the Company's business,
financial condition and results of operations.

On June 25, 1996, Praxair, Inc. ("Praxair") filed a complaint against the
Company arising out of a nitrogen supply contract between the Company and the
plaintiff. The Complaint purports to state causes of action for breach of
contract and promissory estoppel. The Complaint alleges that as a result of
purported breaches of the nitrogen supply contract, the Company is obligated to
pay plaintiff approximately $1,300,000 plus cost of suit, not including
attorney's fees. The Company intends to contest all of Praxair's claims
vigorously. Based on the Company's limited review to date, management believes
that the claims asserted by Praxair are without merit. However, there can be no
assurance that Praxair will not obtain a favorable result in the lawsuit which
could have a material adverse effect on the Company's business, financial
condition and results of operations.


ITEM 2.    CHANGES IN SECURITIES

           Not applicable.



                                       12
<PAGE>   13
ITEM 3.    DEFAULTS UPON SENIOR SECURITIES

           Not applicable.

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

           Not applicable.

ITEM 5.    OTHER INFORMATION

           Not applicable.

ITEM 6.    EXHIBITS AND REPORTS ON FORM 8-K

           (a) Exhibits:
                     27.1  Financial Data Schedule
           (b) No reports on Form 8-K were filed for the period for which this
               report is being filed.


                                       13
<PAGE>   14
                                   SIGNATURES



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




                                       SEEQ TECHNOLOGY INCORPORATED
                                                (Registrant)



Dated: February 11, 1996               By:

                                       /s/ Phillip J. Salsbury
                                       --------------------------------
                                       Phillip J. Salsbury
                                       President and Chief Executive Officer



Dated: February 11, 1996               By:

                                       /s/ Robert O. Hersh
                                       --------------------------------
                                       Robert O. Hersh
                                       Vice President, Finance, Chief
                                       Financial Officer
                                       and Secretary



                                       14




<PAGE>   15

                                 Exhibit Index

Ex 27.1   Financial Data Schedule