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                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-K
(MARK ONE)

[X] Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act
    of 1934 for the fiscal year ended March 31, 1999.
                                       or

[  ] 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: 0-21985

                                   SEEC, INC.
             (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

<TABLE>
<S>                                                      <C>
                      PENNSYLVANIA                                              55-0686906
                (State of Incorporation)                           (I.R.S. Employer Identification No.)

       PARK WEST ONE, SUITE 200, CLIFF MINE ROAD,
                PITTSBURGH, PENNSYLVANIA                                          15275
        (Address of principal executive offices)                                (Zip code)
</TABLE>

       REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (412) 893-0300

          SECURITIES REGISTERED PURSUANT TO SECTION 12(b) of the Act:

<TABLE>
<CAPTION>
                  TITLE OF EACH CLASS                           NAME OF EACH EXCHANGE ON WHICH REGISTERED
                  -------------------                           -----------------------------------------
<S>                                                      <C>
                          None                                                Not applicable
</TABLE>

          SECURITIES REGISTERED PURSUANT TO SECTION 12(g) of the Act:

                    Common Stock, par value $0.01 per share
                                (TITLE OF CLASS)

     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 by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [___]

     As of May 28, 1999, the aggregate market value of voting Common Stock held
by non-affiliates of the registrant, based upon the last reported sale price for
the registrant's Common Stock on the Nasdaq National Market on such date, as
reported in The Wall Street Journal, was $20,457,119 (calculated by excluding
shares owned beneficially by directors and executive officers as a group from
total outstanding shares solely for the purpose of this response).

     The number of shares of the registrant's Common Stock outstanding as of the
close of business on May 28, 1999 was 5,828,866.

                      DOCUMENTS INCORPORATED BY REFERENCE

     Certain portions of the definitive Proxy Statement of SEEC, Inc. ("the
Company" or "SEEC") to be used in connection with the 1999 Annual Meeting of
Shareholders (the "Proxy Statement") are incorporated by reference into Part III
of this Annual Report on Form 10-K to the extent provided herein. Except as
specifically incorporated by reference herein, the Proxy Statement is not to be
deemed filed as part of this Annual Report on Form 10-K.

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                                   SEEC, INC.

                               TABLE OF CONTENTS

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<CAPTION>
                                                                        PAGE
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<S>       <C>                                                           <C>
                                PART I
Item 1.   Business....................................................    1
Item 2.   Properties..................................................   19
Item 3.   Legal Proceedings...........................................   19
Item 4.   Submission of Matters to a Vote of Security Holders.........   19

                               PART II
Item 5.   Market for the Registrant's Common Equity and Related
          Shareholder Matters.........................................   20
Item 6.   Selected Financial Data.....................................   21
Item 7.   Management's Discussion and Analysis of Financial Condition
          and Results of Operations...................................   22
Item 7a.  Market Risk.................................................   31
Item 8.   Financial Statements and Supplementary Data.................   31
Item 9.   Changes in and Disagreements with Accountants on Accounting
          and Financial Disclosures...................................   50

                               PART III
Item 10.  Directors and Executive Officers of SEEC....................   50
Item 11.  Executive Compensation......................................   50
Item 12.  Security Ownership of Certain Beneficial Owners and
          Management..................................................   50
Item 13.  Certain Relationships and Related Transactions..............   51

                               PART IV
Item 14.  Exhibits, Financial Statement Schedules and Reports on Form
          8-K.........................................................   51

SIGNATURES............................................................   53
</TABLE>
<PAGE>   3

ITEM 1. BUSINESS

     Except for historical information contained herein, the following
discussion contains forward-looking statements that involve risks and
uncertainties. Such forward-looking statements include, but are not limited to,
statements regarding future events and the Company's plans and expectations. The
Company's actual results could differ materially from those discussed herein.
Factors that could cause or contribute to such differences include, but are not
limited to, those discussed below in "Factors That May Affect Future Results,"
as well as those discussed elsewhere in this Form 10-K or incorporated herein by
reference. See "Special Note on Forward-Looking Statements."

GENERAL

     SEEC provides enterprise solutions for legacy system evolution -- including
legacy transformation for e-business, application enhancement, integration, and
migration. SEEC's solutions include flexible methodologies, proven tools, and
expert consulting services that have saved significant time and money for over
100 Fortune 1000 companies and more than 20 leading international information
technology ("IT") service providers.

     The Company's software products, including those based on the Company's
core source code analysis technology, automate many of the procedures required
for reengineering mainframe-based legacy software systems. The Company's
products analyze and modify source code, which is downloaded from the mainframe
to a PC-based environment, where it is stored in application dictionaries for
performance of reengineering functions. SEEC has also developed software
products that enable customers to extract business rules and functions from
legacy applications for reuse in object-oriented client/server or web
environments. The Company's solutions combine SEEC tools with methodologies and
consulting services for developing component-based systems that integrate
mainframe applications and data with enterprise resource planning ("ERP"),
customer relationship management ("CRM"), and other client/server- or
Internet-based (also "web-based") applications. SEEC also offers solutions for
reengineering legacy systems to address the transition to the single currency of
the European Monetary Union (the euro), for improving the efficiency and
effectiveness of traditional application maintenance processes, and for
analyzing, renovating, and testing systems for year 2000 compliance.

INDUSTRY BACKGROUND

     Organizations are under increasing pressure to efficiently and effectively
utilize their information technology assets to respond to increasing global
competitive demands. For many business organizations, these IT assets are
critical to their operation and represent a key competitive advantage. Most
large organizations utilize complex, proprietary mainframe computer systems for
their information requirements. These legacy systems contain the core business
rules, processes and data that support the mission-critical operations of these
organizations. Improvements in the performance of mainframes, connectivity with
the Internet, and trends toward centralization of data on the mainframes have
prolonged the life of legacy systems. Industry sources indicate that the
mainframe legacy systems will be retained for a long period of time, thereby
requiring that existing legacy systems be integrated with client/server- and
web-based systems.

     The growing availability and functionality of client/server- and web-based
applications are increasing the rate of integration. ERP applications must often
be integrated with existing legacy systems to access certain programs and data
contained on these legacy systems. There is an increasing need to integrate
client/server- and web-based data warehousing and data mining systems with key
business data developed and maintained on legacy systems, since much of the data
managed and analyzed by data warehousing and data mining applications has been
developed and stored on mainframe legacy systems, and is impacted by legacy
applications. Accordingly, many organizations are seeking solutions that
leverage investments in existing legacy systems and provide efficient and
cost-effective integration.

  Web Enablement

     Many of today's legacy COBOL applications are difficult to maintain, and
enhancing these applications to meet business requirements can be challenging
because the data and process models are not extensible. Increasingly, businesses
look toward leveraging their information infrastructure and assets to improve
efficiency
                                        1
<PAGE>   4

and to remain competitive. As a result, the Internet and e-commerce are
challenging traditional methods of doing business. E-commerce is emerging as a
major business driver. By reengineering legacy applications to a component
architecture, web and data mining applications can be used to improve decision
making, and take advantage of these upcoming e-commerce opportunities.

     Presently, integration of legacy mainframe systems with client/server- and
Internet-based systems has been limited, because the design of these systems
does not offer the flexibility to isolate the user interface from the business
and database logic. Reengineering tools that assist in understanding and
identifying the presentation, business, and data-related logic in an application
help position legacy systems for web enablement. Rebuilding the systems from
scratch is a risky and expensive endeavor, while reengineering involves lower
risk and saves both time and money.

  Legacy System Reengineering

     Organizations that rely on legacy systems must continually reengineer their
systems, applications and databases to meet constantly changing information
requirements and to incorporate technological advances. Many legacy system
applications have been developed internally by these organizations over a number
of years and have been customized to meet specific needs. In addition, legacy
systems often are composed of a variety of hardware platforms, software
applications and databases, many of which utilize different computer languages.
As a result, legacy systems are often highly complex, have little or no
system-wide documentation, and are difficult and expensive to maintain.
According to the Gartner Group, 60% to 80% of the average annual IT application
development budget is spent on reengineering legacy applications. Legacy system
reengineering requirements limit the availability of resources for other
important tasks, such as developing new software applications.

     The majority of legacy system reengineering involves a large number of
incremental or smaller-scale repairs or enhancements to existing systems, such
as an enhancement to a billing system to include additional customer data.
Certain reengineering projects, however, are large-scale in nature and can
require analysis, remediation and testing of millions of lines of code. Examples
of large scale legacy system reengineering needs include year 2000 conversion,
the standardization on the euro in Europe, the combination of existing legacy
systems as the result of a merger or acquisition, or the conversion to a new
COBOL dialect due to a system upgrade or hardware platform change. Traditional
reengineering of these legacy systems is often manual, time-consuming, tedious
and error-prone. Many organizations are attempting to improve the reengineering
process in order to reduce costs, improve productivity and accuracy, and
leverage existing legacy system investments.

  Testing

     Thorough testing of business-critical enterprise applications is an
essential part of the process to ensure reliability of corrected code, whether
as part of year 2000 conversion, euro conversion, or ongoing reengineering
projects. With a short repair time for many reengineering projects, it is
essential to test growing volumes of remediated code. As a result, organizations
are looking for testing solutions that offer greater accuracy, speed and
efficiency than traditional methods allow.

  Independent Verification and Validation

     When organizations have completed a large-scale IT reengineering project,
it is essential to determine whether the changed systems perform as intended.
This can be ensured through independent verification and validation ("IV & V")
of the reengineering efforts. This activity can be a complex, time-consuming,
and expensive endeavor. The Software Engineering Institute has found that up to
60% of all system modifications inadvertently introduce new defects. Defects
found after release can be the most costly to fix. The key goals of IV & V are
to maximize the percentage of defects found and remediated, and to minimize the
unintentional defects introduced as a result of making changes. Additionally, IV
& V provides the independent assurance often required for legal or regulatory
purposes. IV & V is essential for large-scale reengineering projects such as
year 2000 conversion or euro conversion.

                                        2
<PAGE>   5

  Euro Conversion

     The euro currency, a unified monetary and currency system, was introduced
on January 1, 1999, and will be fully implemented by 2002. The period between
1999 and 2002 will be a transition period in which both the euro and national
currencies coexist, creating a complex and difficult business environment.
Preparing and planning to support both the dual-currency and euro currency
phases is not merely a business issue. The implementation of the euro creates
the need for legacy software reengineering to convert code involving existing
national currencies to the new euro. The conversion will be particularly
intensive for financial institutions and insurance companies. Although the euro
has already been introduced, many European companies have not yet begun to
convert their IT systems.

  Year 2000 Conversion

     The year 2000 problem is currently the most critical legacy system
reengineering project for many organizations. The year 2000 problem relates to
the inability of many existing computer systems to completely or accurately
process information or logic involving the year 2000 and beyond. The problem
results from the use of two-digit date fields to perform computations and
decision-making functions in most legacy systems. For example, a program using a
two-digit date field may misinterpret "00" as the year 1900 rather than 2000.
Date-dependent programs are ubiquitous in legacy software applications used in
many critical business operations, and unless these programs are remediated to
address the year 2000 problem, many mission-critical programs may fail or
produce erroneous data or results. The year 2000 problem is particularly acute
for many large organizations with extensive legacy systems that have been
developed over a number of years, such as banks, insurance companies and
governmental agencies. To date, most large organizations have completed the
assessment and remediation stages of their year 2000 projects and are currently
focused on testing and independent verification and validation of the remediated
code.

SEEC'S STRATEGY

     SEEC's objective is to provide enterprise solutions for legacy system
evolution -- including legacy transformation for e-business, application
enhancement, integration, and migration. The following are the principal
elements of the Company's strategy to achieve this objective:

     Enhance and Expand Leadership in Enterprise Solutions.  SEEC intends to
continue to enhance and expand its offerings of enterprise solutions. This
includes the enhancement of its core source code analysis technology, solution
methodologies, and software products to provide additional automation,
functionality and cost savings to its customers. SEEC's core source code
analysis technology allows the Company to efficiently introduce new software
products that can be integrated with new or existing enterprise solutions. The
Company intends to enhance or develop solutions to address additional legacy
system reengineering opportunities, and to acquire technologies or assets that
are complementary to the Company's current line of products, services, and
solutions.

     Leverage Customer Base.  SEEC has dramatically expanded its customer base
through its year 2000 products and solutions. The Company intends to continue to
license its products and sell its enterprise solutions to these customers by
providing additional products and solutions, such as legacy system
reengineering, euro conversion, application enhancement, and web enablement.
SEEC believes that the knowledge and close working relationship it has developed
with its new and existing customers in providing enterprise solutions for the
year 2000 problem will lead to opportunities to provide additional enterprise
solutions to these customers. Also, the Company's customer base may be expanded
through the acquisition of other operating companies.

     Provide Solutions with Broad Market Appeal.  SEEC's enterprise solutions
have been developed to be cost effective, flexible and scalable. As a result,
SEEC's enterprise solutions appeal to a wide range of Fortune 1000 organizations
with a variety of reengineering requirements and to a broad range of third-party
service providers. SEEC intends to capitalize on these opportunities by
marketing and selling its products through a broad range of distribution
channels, including direct sales to end users, sales to end users in conjunction
with third-party service providers, direct sales to third-party service
providers, and indirect sales through distributors.

                                        3
<PAGE>   6

SEEC ENTERPRISE SOLUTIONS

     SEEC's enterprise solutions provide an integrated and comprehensive
approach to legacy system reengineering by combining SEEC's PC-based software
products with well-defined methodologies that enable organizations to analyze,
understand and improve existing legacy systems. SEEC's enterprise solutions are
designed to reduce the time and labor required to perform legacy system
reengineering projects. SEEC's enterprise solutions are provided directly to
end-user customers or to third-party service providers. In addition, customers
may outsource certain enterprise solution needs to the Company. The Company's
enterprise solutions have been utilized by a broad range of customers in a
number of industries to perform legacy system reengineering functions.

  Legacy System Reengineering Solutions

     SEEC Application Enhancement solution allows organizations to enhance their
existing legacy systems to lay the groundwork for new e-business applications.
Organizations may reduce application backlog with time-saving technology that
reduces the system's total cost of ownership, allowing organizations to redeploy
staff for application migration and web-enablement activities. SEEC's solution
offers full life cycle support and seamless integration with established tools.
This technology allows organizations to get ramped-up quickly, so they can
implement the application enhancements required.

     The PC-based Application Enhancement solution provides an effective
environment for maintaining large, mission-critical COBOL applications. It
supports a variety of popular database and operating environments. Application
Enhancement's architecture is built around SEEC's Application Dictionary
Services. The Application Dictionary contains all of the key design elements of
a legacy application, including source code, database definitions, screen
definitions, and job control language. It can be accessed to perform future
maintenance and redevelopment functions, providing additional benefit to the
customer.

     SEEC Application Mosaic Solution provides a flexible component architecture
that facilitates efficient integration with ERP or CRM. SEEC Application Mosaic
allows organizations to leverage business logic and legacy data for rapid
e-business enablement, reduce the cost of ERP/CRM implementation, and reduce the
time needed to develop web applications by enabling Internet access to legacy
data.

     The SEEC Application Mosaic Solution utilizes tools such as SEEC
Reengineering Workbench to analyze legacy code by creating an "Application
Mosaic." The Application Mosaic utilizes SEEC's CRUD (Create, Read, Update,
Delete) matrices and displays to graphically view the relationships between
assortments of programs, files, and screens, and to partition the application
elements into useful, organized functions -- the "Mosaic" -- that are
understandable separately, yet work together as a whole. The Mosaic elements
function as separate units to interface with the Internet, thus connecting the
legacy data with web applications. For ERP/CRM implementation, the Mosaic
elements provide documentation for interfacing with legacy components and
migration of legacy data.

     SEEC is also developing web-enablement solutions that are intended to help
organizations shape their mainframe computer systems into flexible, web-enabled
systems providing seamless, real-time information access for customers,
employees, investors, and business partners. The Company plans to enhance,
develop, or acquire methodologies and software products that will integrate
client/server- or web-based systems. The Company has developed methodologies for
certain of these solutions, although none of the solutions has been marketed to
date.

     These web-enablement solutions are intended to allow users to utilize the
web browser running on their workstations or Network PCs as the primary or only
presentation mechanism. Currently in development are the SEEC Application
Components, implemented as Enterprise Java Beans (a Sun Microsystems
technology), which will access the data interfacing with the legacy mainframe,
database server, or ERP package using a combination of middleware products,
Customer Information and Control System Internet Gateway, transaction servers,
and data components reengineered from the existing systems. The SEEC Application
Components form the critical middle-layer link in the three-tier architecture,
implementing the business logic for the application. Through the web server,
users will connect to the SEEC Application Components and initiate transactions.
The SEEC Application Components reside and execute on the application server.

                                        4
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     Organizations that are evaluating solutions for e-business applications
will benefit from reengineering, because the greatest effort in fashioning a new
design goes into identifying and creating a flexible component architecture.
Documenting the enterprise and application views and extracting business logic
from existing systems is initially a time-consuming effort, but will ultimately
result in time and money savings. The efforts put forth here form the groundwork
for all future technological endeavors, with the documentation becoming vital to
decision making regarding any ERP package implementation that requires
interfacing with legacy components and migration of legacy data. The SEEC
reengineering approach and solution streamlines the reengineering process and
can expedite an organization's move of web-enabled legacy computing towards
component architecture.

  Testing Solution

     SEEC AccuTest is a comprehensive, integrated testing solution that
addresses all phases of mainframe COBOL testing. Testing is an essential
process, integral to all legacy system reengineering projects. AccuTest can be
employed as part of ongoing, non-year 2000 reengineering projects, or in
conjunction with SEEC's Smart Change 2000 solution. AccuTest combines the
breadth and accuracy of SEEC's remediation, test coverage, and path analysis
tools with the strengths of third-party test management and capture/playback
tools and date simulators to create a single, seamless testing solution for
mainframe COBOL legacy systems. AccuTest accelerates remediation and
redeployment of applications, helping IT organizations to reduce the cost of
testing.

  Independent Verification and Validation Solution

     SEEC IV & V Workbench is a comprehensive, integrated solution for
independent verification and validation of large-scale software reengineering
projects, including year 2000 and euro conversion. It combines proven tools and
methodologies for software quality assurance and allows organizations to quickly
check the accuracy of programming changes made by third-party service providers
or internal renovation teams. SEEC's process is comprehensive and highly
accurate. It includes inventory validation, the generation of an independent
seed list, propagation of date fields using SEEC's proprietary data flow
analysis, the identification of compliant and non-compliant code using a
powerful set of rules, and the generation of valuable management reports.

  Euro Conversion Solution

     SEEC provides for the transformation of IT assets for euro conversion
through SEEC Euro Workbench, which is utilized to identify and reengineer
currency-related business functions in legacy code. SEEC Euro Workbench is
comprised of SEEC COBOL Slicer for Euro, SEEC Application Designer, and SEEC
Smart Change for Euro. Together, these tools help analyze existing applications
to evaluate the impact, identify the affected components, identify and extract
affected business rules, and automatically renovate the code. SEEC's approach to
euro conversion identifies an organization's business rules using a set of
proven tools and processes. SEEC Euro Workbench allows the organization to
identify and reengineer currency-related business functions based on top-down
and source code analysis. Its rule-based renovation technology reduces effort
and increases consistency of code changes. The renovated systems are then
analyzed to provide automated test coverage.

  Year 2000 Enterprise Solution

     SEEC provides year 2000 conversion solutions through its Smart Change
Factory. The Smart Change Factory combines SEEC's proprietary software products,
including COBOL Analyst 2000, Smart Change 2000 and COBOL Slicer, with
well-defined methodologies and third-party software products to provide a
comprehensive and integrated solution for year 2000 conversion. The Smart Change
Factory is designed to address all phases of a year 2000 project, including
assessment, planning, remediation and testing, to accurately analyze and
determine which applications require remediation, and to automate certain
portions of the analysis and remediation process. The Smart Change Factory can
be established by an end-user customer, a third-party service provider, or by
SEEC to perform outsourcing services. As a result, the Smart Change Factory
provides for efficient utilization of existing customer IT resources by allowing
a year 2000 project to be performed either in-house by an end user, or partially
or completely outsourced to a third-party service provider. Currently, 25 third-

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party service providers have licensed all or a portion of SEEC's Smart Change
Factory for use in their customers' year 2000 conversion projects.

     The Smart Change Factory is designed to be highly scalable by utilizing
well-defined, repeatable, and reliable processes. In addition, since SEEC's
solutions are PC-based and easy to implement, learn, and use, additional
hardware, software and technical personnel resources can be added quickly and
cost-effectively to meet expanding customer needs. The scalability features of
the Smart Change Factory are particularly attractive to third-party service
providers, who are performing year 2000 conversions on a large scale for a
number of customers and may need to rapidly expand their services to meet
customer demand.

SEEC SOFTWARE PRODUCTS

     SEEC offers a range of proprietary software products for legacy system
reengineering that are integrated with the Company's enterprise solutions or
provided as stand-alone products, allowing customers to meet specific
reengineering needs. The Company's primary software product line is based on its
core source code analysis technology introduced with the COBOL Analyst product
in 1992 and provides a broad range of capabilities to address various legacy
system reengineering needs. The Company's products have been designed to be easy
to use and learn, allowing customers to rapidly train technical personnel and
reduce training costs. SEEC's products operate in a PC-based environment and are
available in versions for Windows 3.1, OS/2, Windows 95, Windows 98, and Windows
NT. SEEC's software products can be purchased in various combinations.

     The Company's primary software products analyze and modify mainframe source
code that is downloaded to a PC-based environment and stored in an application
dictionary for the performance of reengineering functions. The application
dictionary contains all of the key design elements of a legacy application,
including source code, database definitions, screen definitions and job control
language. The Company's software utilizes proprietary parsing, data flow, and
program slicing technology to create the relationships between databases and
source code, which enables the documentation and understanding of a legacy COBOL
system. Information about the flow of control among programs is also stored in
the application dictionary, providing further system understanding by enabling
users to group items by business function. The Company's software also utilizes
proprietary text-scanning technology to identify data fields and the impacted
lines of code for a wide variety of non-COBOL languages.

     SEEC's core source code analysis technology has been designed to allow for
the integration and efficient development of additional software application
modules to meet evolving legacy system reengineering needs. In addition, the
application dictionary created by SEEC's core technology can be accessed to
perform future reengineering functions, providing additional benefit to the
customer. For example, an application dictionary created for a year 2000
conversion can be accessed for other ongoing reengineering needs.

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     As indicated by the following chart, the software products incorporated in
SEEC's legacy system reengineering enterprise solutions and year 2000 solutions
support analysis, planning, remediation, and testing across a wide range of
platforms, languages and databases, including both COBOL and non-COBOL systems:

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                   DATABASES/
                 TELEPROCESSING
   PLATFORMS        MONITORS                    LANGUAGES
---------------  --------------  ----------------------------------------
<S>              <C>             <C>                <C>
IBM MVS          IMS             INTELLIGENT PARSING TECHNOLOGY
IBM VSE          DB2             IBM OS/VS COBOL    IBM COBOL 2
Unisys A-Series  VSAM            IBM DOS/VSE COBOL  Unisys A-Series COBOL
Unisys 2200      IDMS            IBM COBOL 370      Unisys 2200 COBOL
DEC/VAX          ADABAS          CA-Realia COBOL    MicroFocus COBOL
HP 3000          CICS            HP COBOL           DEC/VAX COBOL
                 IMS/DC                             Software AG Natural

                                 RULE-BASED TEXT SCANNING TECHNOLOGY
                                 ADS/O              Assembler
                                 CSP                Easytrieve
                                 Easytrieve Plus    Focus
                                 Fortran            Mantis
                                 LINC II            PL/1
                                 Quickjob           RPG
                                 SAS                TBOL
                                 Telon
</TABLE>

     The following software products utilize the Company's core source code
analysis technology:

     SEEC Reengineering Workbench is a software renewal and transformation
solution designed to reduce the time, costs, and complexity of modernizing,
migrating, or extending mainframe systems for web-enablement, data mining, and
package replacement. SEEC Reengineering Workbench features a Windows NT-based
Application Dictionary and integrated PC-based application analysis tools that
are used to extract business rules and to develop detailed, high-level
blueprints of the data structures and processes that make up the current
mainframe system. This inventory of business rules and road map of the existing
system make it easier to modify the system to address new business requirements.

     The extracted data and business logic from the programs are identified
using the Application Analyst and can also be used to populate a new system
model using SEEC Application Designer, a component modeling tool that is closely
integrated with SEEC's analysis technology. The new model provides all the
information needed to develop application components to link legacy functions
and data with new ERP or other software packages and web-based user interfaces.

     Together, SEEC Application Analyst and SEEC Application Designer help
analyze and heighten understanding of the screens and databases in the existing
applications, producing useful system documentation and extracting the business
rules within legacy COBOL code.

     SEEC COBOL Analyst 2000. COBOL Analyst 2000 is an application reengineering
software product that assists in all phases of year 2000 conversion projects.
COBOL Analyst 2000 utilizes features that enable accurate identification of date
fields in COBOL programs, databases, and screens. COBOL Analyst 2000 generates
impact analysis reports, and provides a cost model for estimating time, labor
and conversion requirements. COBOL Analyst 2000 supports IMS, DB2 and VSAM
databases, and the Company believes it is the only product of its type with
support for ADABAS and CA-IDMS databases. COBOL Analyst 2000 includes a feature
to scan for and locate date patterns and a synonym-processing feature to
identify indirect references to date items.

     SEEC Smart Change 2000. Smart Change 2000 employs SEEC's extensive
knowledge base of commonly-used date rules to identify the items and statements
affected by the year 2000, and uses an expert system to select the appropriate
rule to be applied. Smart Change 2000 enables users to customize data logic
rules to meet specific requirements. Smart Change 2000 modifies the affected
date-related code, replacing it with year 2000-compliant code. All original
source code remains intact, and Smart Change 2000 changes are identified by tags
that mark

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the renovated code and explain why a correction was made. This type of
documentation allows developers to audit and verify changes made and intervene
where necessary to perform manual code changes. This documentation also eases
the task of future reengineering on impacted code.

     SEEC COBOL Slicer. COBOL Slicer uses "program slicing" technology to
increase application reengineering productivity by providing understanding of
business rules embedded in legacy applications. COBOL Slicer allows customers to
understand the program, data structure and input/output screens of an
application. Business rules can then be identified by locating appropriate
slicing criteria and understanding the code slice, control flow and the logical
data model. COBOL Slicer is also used for test planning, including test planning
for year 2000 problems. The test case generation option enables COBOL Slicer to
identify all of the application paths that need to be tested as a result of
changes made for the year 2000 problem.

     In order to address other legacy system reengineering needs, SEEC also has
developed software products that are based on technology other than the
Company's core source code analysis technology:

     SEEC Natural Analyst 2000. Natural Analyst 2000 is a stand-alone software
product that parses and examines Natural/ADABAS applications in order to
efficiently and accurately identify date fields, maps and database descriptions.
Natural Analyst 2000 generates comprehensive year 2000 reports following
application analysis.

     SEEC Date Analyzer. Date Analyzer is a stand-alone product that uses
text-scanning technology to provide year 2000 impact analysis for non-COBOL
applications. Date Analyzer examines the various programs or source files across
languages using a pattern-matching process and then analyzes the language rules
to detect the items and statements that are potentially affected by the year
2000. Date Analyzer utilizes pre-defined language rules that enable it to
address different languages. Date Analyzer produces comprehensive reports and
helps produce a set of metrics used to create a cost estimation model for
non-COBOL source programs.

TRAINING, CONSULTING, AND SERVICES

     SEEC provides a variety of training and consulting services to its
customers for its enterprise solutions and software products. The Company offers
user training at its own facilities or at the customer site. SEEC provides
consulting expertise in its software products, methodologies and project
management. These services enable SEEC's customers to tailor SEEC's enterprise
solutions to fit individual requirements, including setting up a Smart Change
Factory at a customer site or at a third-party service provider site. SEEC
operates Smart Change Factories at customer sites or at its Pittsburgh,
Pennsylvania headquarters on a limited basis. SEEC also undertakes assessment,
remediation, and IV & V projects, on a limited basis, at its headquarters.

PRICING OF PRODUCTS AND PROFESSIONAL SERVICES

     SEEC's software products are typically licensed to customers. End-user
license agreements generally limit the use of products to a fixed number of
users. Typically, the license fee to an end user for SEEC's suite of software
products ranges from $100,000 to $500,000, depending on the number of users,
platforms, languages and databases that must be supported.

     Product pricing for third-party service providers, who typically have
established "factories" for programming conversions for multiple customers, is
based on a line of code ("LOC") usage fee. Third-party service providers
generally make a minimum initial purchase to set up a Smart Change Factory, an
IV & V Factory or a Reengineering Workbench. Additional fees paid by third-party
service providers vary based on the LOC volume processed through the factory
utilizing SEEC's software products and enterprise solutions. The volume of LOC
processed is monitored by the Company through the use of programmed hardware
keys that attach to the factory computers. Recurring maintenance fees are
charged to both end-user customers and third-party service providers based on
the applicable list prices for the software.

     The Company generally offers on-site training and consulting services on a
time-and-materials basis, although from time to time, the Company offers
solutions on a fixed-price basis. These fixed-price contracts are typically
terminable by either party upon written notice. Although the Company uses its
past experience to reduce the risks associated with estimating, planning, and
performing fixed-price projects, the Company has a limited
                                        8
<PAGE>   11

history of such projects on which to base such estimates. The Company's failure
to accurately estimate the resources, costs, and time required for a project, or
its failure to complete its contractual obligations within the time frame
committed could result in cost overruns and reduced margins, and could have a
material adverse effect on the Company's business, operating results and
financial condition.

CUSTOMER AND TECHNICAL SUPPORT

     SEEC offers maintenance for each of its products, which entitles the
customer to receive technical support and advice, including problem resolution
services, installation assistance, error corrections and any product
enhancements released during the maintenance period. SEEC's standard license
agreement does not require SEEC to provide maintenance for any period of time,
and does not provide express or implied warranties for SEEC's product software.
Maintenance and support services are provided primarily by telephone or by
e-mail from the Company's Pittsburgh, Pennsylvania headquarters.

CUSTOMERS

     SEEC's products and services are used by information systems departments of
Fortune 1000 companies and similarly-sized business and governmental
organizations, and by third-party service providers.

     Following is a partial list of customers and service providers that have
purchased products and/or services from SEEC:

<TABLE>
<CAPTION>
                              CUSTOMERS                                           SERVICE PROVIDERS
-------------------------------------------------------------------------------  -------------------------------------
<S>                                         <C>                                  <C>
Alcoa, Inc.                                 Mastercard International, Inc.       Advanced Computer Technology, Inc.
American Savings Bank                       MCI Worldcom                         Complete Business Solutions, Inc.
Anthem Insurance Companies, Inc.            Michigan Department of State         CyberTech International Corp.
Avon Products, Inc.                         National Imaging Mapping Agency      DMR Consulting Group, Inc.
BancOne Services Corporation                Northeastern Illinois Gas Company    HCL Perot Systems
Bank of New York                            Olan Mills, Inc.                     IMI Systems, Inc.
BJC Health Systems, Inc.                    On-Line Financial Services, Inc.     IBM Global Services
CGI Group, Inc.                             Rockwell International Corp.         INTERSOLV, Inc.
Discover Financial Services, Inc.           Ryerson Tull                         Keane, Inc.
EUA Service Corporation                     State of New Mexico                  Mahindra-British Telecom
Federal Election Commission                 State of New York                    Motorola Korea
Firstar Information Services Corp.          State of Washington                  Patni Computer Systems, Private Ltd.
Foremost Insurance Company                  TruServ Corporation                  PASS IT Consulting
General Services Administration             University of Pennsylvania           Satyam Computer Services, Ltd.
Harris Trust and Savings Bank               University of Pittsburgh             SQL Star International, Ltd.
Hudson's Bay Company                        USA Group                            SRA International, Inc.
Kemper Insurance Companies                  Wells Fargo Bank                     Tata Infotech, Ltd.
Longs Drug Stores California, Inc.          Wheeling-Pittsburgh Steel Corp.      Unisys Corporation
Lucent Technologies, Inc.                   Williams Information Services Corp.
Mack Trucks, Inc.

</TABLE>

     Historically, a relatively small number of customers have accounted for a
significant percentage of the Company's revenues. In fiscal 1999, Unisys
Corporation accounted for 12% of the Company's total revenues, and nine
customers represented approximately 50% of the Company's revenues. During fiscal
1998, revenues from INTERSOLV, Inc. accounted for 11% of SEEC's total revenues,
and nine customers represented approximately 50% of the Company's revenues.
During fiscal 1997, revenues from Complete Business Solutions, Inc. were 19% of
the Company's total revenues.

ACQUISITION

     ERA Software Systems Private Limited ("ERA"), an Indian software
development company, provided certain research and development services to SEEC
since the Company's inception in 1988. ERA also served as the distributor of
SEEC's products in India and other markets, subject to royalty payments to SEEC
of 50% of the Company's suggested international price list for all products
distributed by ERA. In March 1996, SEEC and ERA entered into a Product Purchase
Agreement and a Marketing Agreement to cover the terms and conditions of the

                                        9
<PAGE>   12

research and development services and distribution rights, respectively. The
Product Purchase Agreement provided for the transfer to SEEC of ERA's 35%
ownership interest in jointly-owned products and technologies, and for ERA to
provide design and development work with respect to SEEC's products on a
non-exclusive, time-and-materials basis. In consideration of ERA's transfer of
its ownership interest in the products and technology, SEEC issued 226,305
shares of its Common Stock to ERA.

     On February 27, 1998, SEEC and ERA entered into an agreement whereby ERA
transferred its distribution rights for SEEC products, plus certain fixed assets
and 30 ERA employees engaged in SEEC-related research and development, sales and
administration, to SEEC for net consideration of $1,041,000. The acquisition was
effective at the close of business February 28, 1998, at which time the Product
Purchase Agreement and Marketing Agreement were terminated, and SEEC assumed
control and responsibility for product distribution and development efforts.
Final closing of the acquisition took place during the second quarter of fiscal
1999. At closing, $1,036,000 in cash, and other consideration valued at $5,000
were remitted to ERA. SEEC Technologies Asia Private Limited ("SEEC Asia") was
formed as a wholly-owned subsidiary of SEEC to effect the acquisition and to
hold and manage the acquired rights, certain assets and SEEC-related product
development projects. (See also Research and Development.)

SALES, MARKETING AND DISTRIBUTION

     SEEC markets and sells its products and solutions directly through its
direct sales force and indirectly through third-party service providers. To
support its sales efforts, SEEC utilizes media advertising and direct mail
campaigns supported by promotion through trade articles and trade shows. In
addition, SEEC enters into software licenses and other arrangements with
third-party service providers such as Complete Business Solutions, IBM, and
Unisys. These third-party service providers utilize the Company's solutions and
software products in connection with legacy system reengineering engagements,
including year 2000 services. SEEC has granted several organizations the
non-exclusive right to market its products. In North and South America, SEEC
sells and supports its products and services from its Pittsburgh, Pennsylvania
headquarters and its six U.S. regional offices. Sales and support services are
provided in Europe through the Company's wholly-owned subsidiaries, SEEC Europe
Limited ("SEEC Europe"), based in London, England, and SEEC Germany GmbH ("SEEC
Germany"), based in Munich, Germany. SEEC sells and supports its products and
services in the Asian and Pacific Rim markets through SEEC Asia, its
wholly-owned subsidiary in Hyderabad, India, and through branch offices in
Seoul, South Korea, and in Singapore. Prior to February 28, 1998, these markets
had been served by ERA.

     As of March 31, 1999, SEEC had 41 employees engaged in sales and marketing.
In fiscal 1999, 1998, and 1997, 27%, 21%, and 16%, respectively, of the
Company's revenues were from sales to customers outside of the United States,
including sales to ERA.

     SEEC intends to continue to expand its sales and marketing effort by hiring
additional sales and marketing personnel, by opening new sales offices, and by
entering into additional arrangements with third-party service providers and
distributors. SEEC also intends to enter into additional distribution, license
and/or marketing agreements for its software products, particularly with service
providers or strategic systems integrators. The Company is focused on leveraging
its existing year 2000 solutions customer base to cross-sell other enterprise
solutions and software products.

     In November 1993, SEEC entered into a five-year International Software
Marketing and License Agreement (the "Viasoft Agreement") with Viasoft, Inc.
("Viasoft"), pursuant to which SEEC granted Viasoft a worldwide license to use
and market all of SEEC's products that address the COBOL maintenance market,
including the COBOL Analyst product line, but excluding the year 2000 products,
under Viasoft's private label, "ESW/PC". The license granted Viasoft limited
exclusive marketing rights through June 1, 1995 and non-exclusive rights
thereafter. Pursuant to the Viasoft Agreement, Viasoft paid SEEC a royalty of
30% of all license or maintenance fees related to its distribution of SEEC's
products up to a maximum of $2 million, and thereafter a royalty of 25% of
license fees and 30% of maintenance fees related to SEEC's products. The Viasoft
Agreement permitted SEEC to use Viasoft's proprietary COBOL Parser Validation
Suite ("COBOL Parser") to test SEEC's products. In exchange for such use, SEEC
agreed to pay to Viasoft a royalty of 5% of SEEC's sales of products that
contain or

                                       10
<PAGE>   13

use a COBOL Parser, subject to a maximum royalty payment of $1 million and a
minimum royalty payment of $100,000, during the five-year period ended April 29,
1999.

     SEEC gave notice to Viasoft on December 3, 1996 of its intention to
terminate the Viasoft Agreement as a result of Viasoft's failure to make minimum
royalty payments of at least $1 million during the third year of the Viasoft
Agreement. SEEC received notice from Viasoft that it did not intend to extend
the Viasoft Agreement by making such minimum payments, and acknowledging that
the Viasoft Agreement terminated effective June 4, 1997.

     The Viasoft Agreement had provided that, upon termination, the Company
would be obligated to deliver to Viasoft that number of copies of the licensed
products equal to the balance of the advanced royalty divided by the applicable
licensed product royalty amount. On June 30, 1997, the Company received formal
notice from Viasoft that the Company was relieved of such obligation, and that
no further copies of the licensed products were to be delivered to Viasoft.
Accordingly, the $780,552 balance of the advance royalty was recognized as
software license revenue in fiscal 1998.

COMPETITION

     The market for SEEC's enterprise solutions and software products is
intensely competitive and is characterized by rapid change in technology and
user needs and the frequent introduction of new products. SEEC's principal
competitors in the enterprise solutions and software products markets include
Computer Associates International, Inc., Compuware Corp., MERANT PLC, and
Viasoft. Many of the Company's competitors are more established, benefit from
greater name recognition and have substantially greater financial, technical and
marketing resources than the Company.

     SEEC believes that the principal factors affecting competition in its
markets include product performance and reliability, product functionality,
ability to respond to changing customer needs, ease of use, training, quality of
support and price. Other than technical expertise, there are no significant
proprietary or other barriers to entry that could prevent potential competitors
from developing or acquiring similar software products or providing competing
solutions in the Company's market.

RESEARCH AND DEVELOPMENT

     The Company intends to continue to enhance its current products, and to
develop, acquire, or license new products or technology to keep pace with
evolving industry standards and technological developments, and to provide
additional functionality to address changing customer needs. This may require,
among other things, that the Company build interfaces with third-party products.

     In the latter half of fiscal 1998, the Company began to direct most of its
research and development efforts towards adapting its core source code analysis
technology to provide enterprise solutions unrelated to the year 2000 problem.
Natural extensions and applications of the Company's core technology include
reengineering solutions for legacy systems for web enablement, data warehousing,
client/server migration, and also for the euro currency conversion. The Company
believes that each of these potential reengineering solutions represents a
significant market and revenue opportunity.

     SEEC's development of new products over the last three years has been
accomplished primarily with in-house development personnel and resources, as
well as in conjunction with ERA. The initial development of SEEC's COBOL
maintenance products was funded in part by a grant from Industrial Credit and
Investment Corporation of India, Ltd. ("ICICI") pursuant to the Cooperation and
Project Financing Agreement (the "Cooperation Agreement") among ICICI, SEEC and
ERA. The Cooperation Agreement provided for joint ownership by SEEC and ERA of
all products developed with funds provided thereunder. In March 1996, SEEC and
ERA entered into a Product Purchase Agreement (the "Product Purchase
Agreement"), pursuant to which ERA transferred its ownership interest in SEEC's
products and technologies to SEEC, and agreed to assist SEEC in developing new
products and technologies. Pursuant to the Product Purchase Agreement, ERA had
the nonexclusive right to perform design and development work with respect to
SEEC's products pursuant to specified development schedules. In addition, ERA
had agreed to maintain in India the necessary infrastructure

                                       11
<PAGE>   14

and personnel to support such design and development work. ERA had also agreed
to transfer to SEEC the necessary manpower for product support and to maintain a
team of personnel in India for maintenance of SEEC's products.

     ERA's research and development employees and related assets, along with
certain other rights and assets, were transferred to SEEC's control effective
February 28, 1998, in an acquisition effected by SEEC Asia. (See Acquisition.)

     As of March 31, 1999, SEEC had 30 employees engaged in product development,
including 15 employees of SEEC Asia. During fiscal 1999, 1998 and 1997, research
and development expenditures, including research and development fees paid to
ERA, were $1,302,000, $1,105,000, and $427,000, respectively. The Company
anticipates that it will continue to commit substantial resources to research
and development in the future.

INTELLECTUAL PROPERTY

     SEEC relies on a combination of copyright, trade secret and trademark laws,
and contractual provisions to establish and protect its rights in its software
products and proprietary technology. The Company protects the source code
version of its products as a trade secret and as an unpublished copyrighted
work. Despite these precautions, it may be possible for unauthorized parties to
copy certain portions of the Company's products or to reverse engineer or obtain
and use information that the Company regards as proprietary. The Company has no
patents, and existing copyright and trade secret laws offer only limited
protection. Certain provisions of the license and distribution agreements
generally used by the Company, including provisions protecting against
unauthorized use, copying, transfer and disclosure, may be unenforceable under
the laws of certain jurisdictions, and the Company is required to negotiate
limits on these provisions from time to time. 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 United States. The Company has been and may be
required from time to time to enter into source code escrow agreements with
certain customers and distributors, providing for release of source code in the
event the Company breaches its support and maintenance obligations, files
bankruptcy, or ceases to continue doing business.

     The Company's competitive position may be affected by its ability to
protect its proprietary information. However, because the software industry is
characterized by rapid technological change, the Company believes that patent,
trademark, copyright, trade secret and other legal protections are less
significant to the Company's success than other factors such as the knowledge,
ability and experience of the Company's personnel, new product and service
development, frequent production enhancements, customer service, and ongoing
product support.

     While the Company has no knowledge that it is infringing the proprietary
rights of any third party, there can be no assurance that such claims will not
be asserted in the future with respect to existing or future products. Any such
assertion by a third party could require the Company to pay royalties, to
participate in costly litigation, and to defend licensees in any such suit
pursuant to indemnification agreements or to refrain from selling an alleged
infringing product or service. See "Factors that May Affect Future Results --
Dependence on Proprietary Rights."

     SEEC Smart Change Factory(R), SEEC Date Analyzer(R), SEEC COBOL Analyst(R),
SEEC COBOL Slicer(R), SEEC COBOL Analyst 2000(R), SEEC Smart Change 2000(R) and
SEEC AccuTest(R) are U.S. registered service marks of the Company. Applications
for U.S. registrations of the marks SEEC Smart Change(TM), SEEC AccuFind(TM),
SEEC AccuFix(TM), SEEC Quick Fix(TM), SEEC Euro Workbench(TM), SEEC IV & V
Workbench(TM), SEEC Re-engineering Workbench(TM), SEEC Application Designer(TM),
SEEC Application Mosaic(TM), and SEEC Application Analyst(TM) are pending. SEEC
trademarks and service marks are also registered or pending in various foreign
countries.

EMPLOYEES

     As of March 31, 1999, SEEC and its subsidiaries had 121 employees,
including 41 in sales and marketing, 30 in research and development, nine in
customer support, 23 in professional services and 18 in corporate

                                       12
<PAGE>   15

operations and administration worldwide. The Company's continued success will
depend, in part, upon its ability to hire and retain key senior management and
skilled technical, professional services and sales and marketing personnel. The
market for qualified personnel has historically been, and the Company expects
that it will continue to be, intensely competitive. None of SEEC's employees is
represented by a collective bargaining agreement. SEEC believes that its
relations with its employees are favorable.

FACTORS THAT MAY AFFECT FUTURE RESULTS

     Significant Fluctuations in Quarterly Operating Results. The Company has
experienced, and expects to continue to experience, significant fluctuations in
its quarterly operating results. There can be no assurance that the Company will
be profitable in any particular quarter. Quarterly operating results may
fluctuate due to a variety of factors, including the budgeting and purchasing
practices of the Company's customers, which affect the volume and timing of
product orders and solution engagements received by the Company, the timing or
the announcement and introduction of new products and product enhancements by
the Company and competitors, market acceptance of new products, the mix of
direct and indirect sales, the mix of license fee and services revenues, the mix
of maintenance, training and consulting services within services revenues, the
number and timing of new hires, the loss of any key, sales, marketing or
professional services personnel, the length of its sales cycles, competitive
conditions in the industry and general economic conditions.

     The Company has historically recognized a significant portion of its
revenues in the last month of a quarter, with these revenues frequently
concentrated in the last week of a quarter. As a result, license fee revenue in
any quarter is substantially dependent on orders booked and shipped in the last
month and last week of that quarter. Further, the Company's enterprise solutions
business is expected to be characterized by significant customer concentration
and relatively large projects. The Company has historically operated with little
or no backlog and, as a result, the Company's revenues for a particular quarter
are generally dependent on orders received during that quarter, including large
orders. The failure to receive a large order in a given quarter could materially
and adversely affect the Company's operating results for that quarter. The
Company's expenses are based, in part, upon anticipated revenue levels and
planned projects, and the Company may not be able to adjust spending in a timely
manner to compensate for any unexpected shortfall in revenues. Accordingly, the
timing of product shipments or achievement of specified performance milestones
on certain customer solution engagements could cause variations in operating
results from period to period and could result in quarterly losses if shipments
are not made or milestones are not achieved within the quarter anticipated. Due
to the foregoing factors, the Company believes that quarter-to-quarter
comparisons of its financial results are not necessarily meaningful and should
not be relied upon as an indication of future performance. The Company has
limited ability to forecast future revenues, and it is likely that in some
future quarters, the Company's operating results will be below the expectations
of securities analysts and investors. In the event that operating results are
below expectations, or in the event that adverse conditions prevail or are
perceived to prevail generally or with respect to the Company's business,
operating results or financial condition, the price of the Company's Common
Stock would likely be materially and adversely affected. See "Management's
Discussion and Analysis of Financial Condition and Results of Operations."

     Dependence on Year 2000 Solutions; Need to Develop and Market Additional
Products and Solutions. The Company currently generates substantially all of its
revenues from its year 2000 solutions, and such solutions are expected to
continue to account for a significant portion of the Company's revenues in
fiscal 2000. Although the Company believes that the demand for its year 2000
solutions will continue to exist beyond fiscal 2000, the level of this demand is
uncertain. The demand will diminish significantly over time and will eventually
disappear. Accordingly, the Company's operating results will depend, in large
part, on achieving market acceptance of its web enablement, legacy system
reengineering, and other non-year 2000 products and solutions. The lack of
increased demand for such solutions or an increase in competition in the market
for such solutions would have a material adverse effect on the Company's
operating results and financial condition. In order to achieve sustained growth,
the Company must develop and successfully market its non-year 2000 products and
solutions. The Company's strategy is to leverage the market recognition and
business relationships it has achieved through sales of its year 2000 solutions
to enhance its efforts in other markets. There can be no assurance, however,
that the Company will be successful in generating business by selling additional
products or solutions to its year 2000

                                       13
<PAGE>   16

customers or new customers, or, if it is, that such products and solutions will
achieve market acceptance at a rate sufficient to maintain growth, or even to
offset declines in revenues generated by its year 2000 solutions. The Company's
year 2000 solutions incorporate SEEC's core technology and may be utilized by
SEEC's customers for future ongoing and additional reengineering tasks. There
can be no assurance that such customers will utilize SEEC's core technology for
non-year 2000 reengineering tasks, or that significant revenues will result from
such utilization.

     SEEC has developed products and solutions for the migration of existing
COBOL software applications from legacy systems to multi-tier web architectures.
The Company has not yet attempted to market and sell such products to date, and
there can be no assurance that they will achieve market acceptance in the
future. The Company anticipates that migration from legacy systems to web-based
systems will be gradual, particularly for large, customized applications. Many
organizations perceive a high degree of risk and expense in migrating entire
applications from a mainframe environment to a distributed environment. The
market for such products and solutions may not develop to the extent or in the
time periods anticipated by the Company. See "Business." The failure to
diversify and develop additional products and solutions would have a material
adverse effect on the Company's business, operating results, and financial
condition.

     Uncertainty of Current and Future Demand for New Solutions.  The Company is
currently focusing a significant portion of its efforts on the marketing and
sale of products and enterprise solutions for web enablement and reengineering
of legacy systems. Although the Company believes that the markets for these
products and solutions will grow significantly, there can be no assurance that
these markets will develop to the extent anticipated by the Company. In
addition, organizations affected by the year 2000 problem may not be willing or
able to allocate the financial or other resources required to address the new
initiatives and projects in a timely manner. Some organizations are expected to
postpone IT-related purchases or the deployment of new applications during the
latter part of calendar 1999 and the first months of calendar 2000. Due to these
factors, development of the markets for products and solutions addressing web
enablement and legacy system reengineering is uncertain and unpredictable. If
such markets fail to develop, or develop more slowly than anticipated, the
Company's business, operating results and financial condition could be
materially and adversely affected.

     Ability to Manage Change and Rapid Growth.  The Company has recently
experienced significant changes in its business, such as the development of new
products and solutions, significant revenue growth, and expansion of operations.
These changes have placed, and are expected to continue to place, significant
demands on its management, operational and financial resources. The Company has
expanded its direct sales force. The failure of such personnel to perform as
anticipated and achieve their sales goals, or any delay in achieving such goals
could have a material adverse effect on the Company's business, operating
results and financial condition. The Company has also expanded its operations by
opening new offices in new geographic regions. No assurance can be given that
such new offices will be successful in generating additional revenues, or that
any such revenues will be sufficient to cover the costs of opening and operating
such offices. The Company's future growth, should it occur, may require the
Company to manage a number of large projects in different geographic locations.
There can be no assurance that the Company will be able to do so effectively.
The Company's failure to do so could have a material adverse effect on the
Company's business, operating results and financial condition. In addition, the
development of the market for products and solutions addressing e-business is
uncertain, unpredictable and subject to rapid change. The Company's failure to
respond to such changes and adapt its solutions and strategies accordingly could
have a material adverse effect on the Company's business, operating results and
financial condition. See "Management's Discussion and Analysis of Financial
Condition and Results of Operations" and "Business."

     Ability to Address Technological Changes and Customer Requirements; New
Products and Solutions.  The Company's future success will depend, in large
part, on its ability to enhance its current products and develop or acquire new
products to keep pace with evolving industry standards and technological
developments, and to provide additional functionality to address changing
customer needs. This will require, among other things, that the Company build
interfaces with third-party products and adapt to changing industry standards.
There can be no assurance that the Company will be successful in developing or
acquiring product enhancements or new products, that it can introduce such
products or enhancements on a timely basis, or that any such products or
enhancements
                                       14
<PAGE>   17

will be successful in the marketplace. The Company's delay or failure to develop
or acquire products that keep pace with evolving industry standards and
technological developments or provide additional functionality to address
changing customer needs could have a material adverse effect on its business,
operating results and financial condition. In addition, there can be no
assurance that such products or enhancements will meet the requirements of the
marketplace or achieve market acceptance. Further, there can be no assurance
that new technologies will not be developed by one or more third parties that
render the Company's products and solutions obsolete. See "Business -- Research
and Development."

     Intense Competition.  The market for the Company's enterprise solutions and
software products, and in particular its products and solutions for the year
2000 problem, is intensely competitive and is characterized by rapid change in
technology and user needs and the frequent introduction of new products and
solutions. The Company's principal competitors in the software products market
include Computer Associates International, Inc., Compuware Corp., MERANT PLC,
Sterling Software, Inc., and Viasoft, Inc. Many of the Company's competitors are
more established, benefit from greater name recognition, and have substantially
greater financial, technical and marketing resources than the Company.
Additionally, there can be no assurance that the Company's competitors will not
form joint ventures, business combinations or other strategic alliances and
develop or offer comprehensive enterprise solutions that further compete with
the Company's products and solutions. The announcement of such developments,
prior to release, may result in potential customers delaying their purchasing
decisions while they evaluate the new competitive products. Certain of the
Company's current or potential competitors also serve as sales channels for the
Company's products and solutions and may elect to discontinue their sales
efforts for the Company's products or solutions or to commence or increase their
promotional and sales efforts for their own products and solutions. The Company
believes that the principal factors affecting competition in its markets include
product performance and reliability, product functionality, ability to respond
to changing customer needs, ease of use, training, quality of support and price.
Other than technical expertise, there are no significant proprietary or other
barriers to entry that could keep potential competitors from developing or
acquiring similar products or providing competing solutions in the Company's
market.

     The Company's ability to compete successfully in the sale of enterprise
solutions and software products will depend in large part upon its ability to
attract new customers, sell products and solutions, expand its direct sales
force and its indirect sales and marketing channels, deliver and support product
enhancements to its existing and new customers, and respond effectively to
continuing technological change by developing new solutions and products. There
can be no assurance that the Company will be able to compete successfully in the
future, or that future competition for product sales and solutions or other
competitive factors will not have a material adverse effect on the Company's
business, operating results and financial condition. See
"Business -- Competition."

     Risks Related to Possible Acquisitions.  The Company may acquire existing
businesses, products, and technologies to enhance and expand its line of
software products and enterprise solutions, and to expand its customer base.
Such acquisitions may be material in size and in scope. There can be no
assurance that the Company will be able to identify, acquire, or profitably
manage additional businesses or successfully integrate any acquired businesses
into the Company without substantial expenses, delays, or other operational or
financial problems. Acquisitions involve a number of special risks and factors,
including increasing competition for attractive acquisition candidates in the
Company's markets, the technological enhancement and incorporation of acquired
products into existing product lines and services, the assimilation of the
operations and personnel of the acquired companies, failure to retain key
acquired personnel, adverse short-term effects on reported operating results,
the amortization of acquired intangible assets, the assumption of undisclosed
liabilities of any acquired companies, the failure to achieve anticipated
benefits such as cost savings and synergies, as well as the diversion of
management's attention during the acquisition and integration process. Some or
all of these special risks and factors may have a material adverse impact on the
Company's business, operating results, and financial condition. The Company does
not have significant experience in the identification and management of
acquisitions, and the success of its acquisition strategy will depend on the
effective management of the foregoing risks and its ability to identify,
complete, and integrate strategic acquisitions on favorable terms.

     Potential for Product Liability.  The Company's enterprise solutions and
products are often utilized to perform reengineering functions on
mission-critical components of its customers' information systems. The programs
and data contained in these systems are often necessary for the continuation of
the customer's business
                                       15
<PAGE>   18

and are critical to the operations and financial performance of the customer.
Any failure of these systems could have a material adverse effect upon the
Company's customers and could result in a claim for substantial damages against
the Company, regardless of the Company's responsibility for such failure. In
connection with the license of its products and the sale of its services, the
Company attempts to contractually limit its liability for damages arising from
negligent acts, errors, mistakes or omissions. Despite this precaution, there
can be no assurance that the limitations of liability set forth in its customer
contracts would be enforceable or would otherwise protect the Company from
liability for damages. Additionally, the Company maintains general liability
insurance coverage with limits of $1 million per occurrence and $1 million
aggregate coverage and excess liability insurance coverage with limits of $6
million per occurrence and $6 million aggregate coverage. However, there can be
no assurance that such coverage will continue to be available on acceptable
terms, or will be sufficient to cover one or more large claims, or that the
insurer will not disclaim coverage as to any future claim. The successful
assertion of one or more large claims against the Company that exceed available
insurance coverages or changes in the Company's insurance policies, such as
premium increases or the imposition of large deductible or co-insurance
requirements, could have a material adverse effect on the Company's business,
operating results and financial condition.

     Risks Associated with Sales Channels.  The Company's ability to achieve
significant revenue growth in the future will depend, in part, on its success in
recruiting and training sufficient direct sales personnel and expanding the
number of third-party service providers which utilize or market the Company's
products. Although the Company is currently investing, and plans to continue to
invest, significant resources to develop and expand its direct sales force and
expand its network of third-party service providers, the Company has at times
experienced and may continue to experience difficulty in recruiting qualified
personnel for its direct sales force and entering into or maintaining
relationships with third-party service providers. There can be no assurance that
the Company will be able to maintain or successfully expand its direct sales
force or network of service providers, or that any such expansion will result in
an increase in revenue. Any failure by the Company to expand its direct sales
force or network of service providers could have a material adverse effect on
the Company's business, operating results and financial condition. The Company's
agreements with its third-party service providers are generally non-exclusive,
and some may be terminated by either party without cause. The Company's
third-party service providers are not within the control of the Company, are not
obligated to purchase products from the Company and may also offer their own
product lines and solutions or represent or refer product lines or solutions
offered by the Company's competitors. There can be no assurance that these
service providers will continue their current relationships with the Company, or
that they will not give higher priority to the sale or referral of other
products or solutions, including products or solutions of the Company's
competitors. A reduction in sales efforts or discontinuance of sales or
referrals of the Company's products by third-party service providers could lead
to reduced sales and could materially and adversely affect the Company's
business, operating results and financial condition. Certain of the Company's
current or potential competitors also serve as sales channels for the Company's
solutions and may elect to discontinue their sales efforts for the Company's
products or solutions or to commence or increase their promotional and sales
efforts for their own products and solutions.

     The Company's strategy of marketing its products directly to end users and
indirectly through third-party service providers may result in distribution
channel conflicts. The Company's direct sales efforts may compete with those of
its indirect sales channels and, to the extent that third-party service
providers target the same customer, such service providers may come into
conflict with each other. There can be no assurance that channel conflicts will
not materially and adversely affect the Company's relationships with its
customers or third-party service providers or its ability to attract additional
service providers.

     Reliance on Certain Relationships.  The Company has established strategic
relationships with a number of organizations that it believes are important to
its worldwide sales, marketing and support activities. The Company's
relationships with its service providers such as Complete Business Solutions,
Inc., IBM, Keane, Inc., and Unisys Corporation expand the distribution of its
products. There can be no assurance that the Company's service providers, many
of which have significantly greater financial and marketing resources than the
Company, will not develop or market software products which compete with the
Company's products in the future or will not otherwise discontinue their
relationships with or support of the Company. The failure by the Company to

                                       16
<PAGE>   19

maintain its existing relationships or to establish new relationships in the
future could have a material adverse effect on the Company's business, operating
results and financial condition.

     Dependence on Offshore Software Development.  A significant element of the
Company's business strategy is to continue to leverage its investment in SEEC
Asia. SEEC believes that the use of this offshore software development center
will provide the Company with a potential cost advantage over some of its
competitors. In the past, India has experienced significant inflation and other
economic difficulties and has been subject to significant currency fluctuations.
The Indian government has exercised and continues to exercise significant
influence over many aspects of the Indian economy, and Indian government actions
concerning the economy could have a material adverse effect on private sector
entities. During the past several years, India's government has provided
significant tax incentives and relaxed certain regulatory restrictions in order
to encourage foreign investment in specified sectors of the economy, including
the software development industry. Certain of those benefits which have directly
affected the Company include, among others, tax holidays, liberalized import and
export duties, and preferential rules concerning foreign investment and
repatriation. Notwithstanding these benefits, however, India's central and state
governments remain significantly involved in the Indian economy as regulators.
The elimination of any of these benefits could have a material adverse effect on
the Company's business, operating results and financial condition. Further, no
assurance can be given that the Company will not be materially and adversely
affected by future changes in inflation, interest rates, currency valuation,
taxation, social stability or other political, economic or diplomatic
developments in or affecting India. See "Business -- Research and Development."

     Risk of Doing Business in International Markets.  In fiscal 1999, 1998, and
1997, 27%, 21%, and 16%, respectively, of the Company's revenues were from
international customers, including sales to ERA. The Company expects that
international revenues will account for an increasingly significant percentage
of the Company's revenues. The Company has formed wholly-owned subsidiaries or
branch operations in the United Kingdom, Germany, India, South Korea, and
Singapore, and plans to expand its operations in other international markets. As
a result, the Company will be subject to a number of risks, including, among
other things, difficulties in administering its business globally, managing
foreign operations, currency fluctuations, restrictions against the repatriation
of earnings, export requirements and restrictions, and multiple and possibly
overlapping tax structures. In addition, the Company may, from time to time,
experience a decrease in sales in certain foreign countries as a result of
general economic conditions in such countries. These risks could have a material
adverse effect on the Company's business, operating results and financial
condition. In addition, acceptance of the Company's products in certain
international markets may require exclusive, time-consuming and costly
modifications to the Company's products to localize the products for use in
particular markets. Any earnings generated in countries other than the United
States may be permanently invested outside the United States, or may be subject
to considerable taxation if repatriated to the United States. The Company
expects to incur significant costs in foreign currencies to enhance its
marketing, sales and distribution in other countries. In contrast, the Company
presently generates most of its revenue in U.S. dollars. Accordingly, the
Company is subject to risks that, as a result of currency fluctuations, the
translation of foreign currencies into U.S. dollars for accounting purposes
could adversely affect its operating results. Historically, the Company's
foreign exchange transactions have not been significant.

     Dependence on Key Personnel.  The Company's success will depend, in part,
upon its ability to hire and retain key senior management and skilled technical,
professional services and sales and marketing personnel. In particular, the
Company's operations, including its strategic direction, sales and research and
development efforts, are dependent on Ravindra Koka, the Company's President and
Chief Executive Officer. Although the Company believes it will be able to hire
qualified personnel for such purposes, an inability to do so could materially
and adversely affect the Company's ability to market, sell, develop and enhance
its enterprise solutions and products. The market for qualified personnel has
historically been, and the Company expects that it will continue to be,
intensely competitive, and the process of locating and hiring qualified
personnel can be difficult, time-consuming and expensive. Specifically, the
demand for experienced Java project managers and programmers is expected to
continue to increase significantly over the next several years. Many of the
Company's IT professionals are citizens of countries other than the United
States, with most of those working in the U.S. under H-1B temporary visas. Under
current law, there is a statutory limit on new H-1B visas that may be issued in
a given year. As of

                                       17
<PAGE>   20

April 6, 1999, the U.S. Immigration and Naturalization Service stopped accepting
new H-1B petitions, which may indicate that the statutory limit has been reached
for the government's fiscal year ending September 30, 1999. If the Company is
unable to obtain H-1B visas for its employees in sufficient quantities or at a
sufficient rate for a significant period of time, the Company's business,
operating results, and financial condition could be materially and adversely
affected.

     The Company has been hiring, and intends to continue to hire, sales
managers and other senior management personnel. The Company's success will
depend in part on the successful assimilation and performance of these
individuals. The loss of one or more of its key employees, in particular, Mr.
Koka, or the Company's inability to hire and retain other qualified employees
could have a material adverse effect on the Company's business, operating
results and financial condition. The Company has employment agreements with
certain key employees, including Mr. Koka, but does not maintain key man life
insurance on any its employees.

     Dependence on Proprietary Rights.  The Company's success is heavily
dependent upon its proprietary technology. The Company regards its enterprise
solutions and software products as proprietary and attempts to protect them
under a combination of copyright, trade secret and trademark laws as well as by
contractual restrictions on employees and third parties. Despite these
precautions, it may be possible for unauthorized parties to copy the Company's
software or to reverse engineer or otherwise obtain and use information the
Company regards as proprietary. The Company has no patents, and existing trade
secret and copyright laws provide only limited protection. Certain provisions of
the license and distribution agreements generally used by the Company, including
"shrink-wrap" license agreements, which include provisions protecting against
unauthorized use, copying, transfer and disclosure, may be unenforceable under
the laws of certain jurisdictions, and the Company is required to negotiate
limits on these provisions from time to time. Policing unauthorized use of the
Company's products is difficult and, while the Company is unable to determine
the extent to which piracy of its software exists, software piracy is expected
to be a persistent problem, particularly in international markets and as a
result of the growing use of the Internet. Certain third parties have been
provided access to the source code for certain of the Company's products. Access
to source code may increase the possibility of misappropriation or misuse of the
Company's software. The Company's close relationship with certain third
party-service providers increases the risk that such providers may attempt to
use the Company's proprietary products and methodologies to develop their own
solutions that compete with those of the Company. 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 United States. There can be no assurance that the
steps taken by the Company will be adequate to deter misappropriation of
proprietary information, or that the Company will be able to detect unauthorized
use and take appropriate steps to enforce its intellectual property rights. In
addition, the Company's solutions depend, to a certain extent, on the ability of
the Company to build interfaces with third party software products, which are
subject to the proprietary rights of such third parties. There can be no
assurance that such third parties will continue to support or update such
products, or that the Company will continue to have the access to such products
necessary to offer the interfaces as a component of the Company's solutions.

     Significant and protracted litigation may be necessary to protect the
Company's proprietary rights, to determine the scope of the proprietary rights
of others, or to defend against claims for infringement. The Company is not
aware that any of its products, trademarks or other proprietary rights infringe
the proprietary rights of third parties, and the Company is not currently
involved in any litigation with respect to proprietary rights. Infringement
claims against software developers are likely to increase as the number of
functionally-similar products in the market increases. There can be no assurance
that third-party claims, with or without merit, alleging infringement will not
be asserted against the Company in the future. Such assertions, whether with or
without merit, can be time-consuming and expensive to defend, and could require
the Company to cease the use and sale of infringing products, trademarks or
technologies, to incur significant litigation costs and expenses, and to develop
or acquire non-infringing technology, or to obtain licenses to the alleged
infringing technology. There can be no assurance that the Company would be able
to develop or acquire alternative technologies or to obtain such licenses on
commercially acceptable terms or at all, which could have a material adverse
effect on the Company's business, operating results and financial condition. See
"Business -- Intellectual Property."

     Volatility of Stock Price.  The market prices of companies addressing the
year 2000 problem, including the Company, have been highly volatile. The market
price of the Common Stock is likely to continue to be highly
                                       18
<PAGE>   21

volatile and may increase or decrease significantly as a result of factors such
as actual or anticipated fluctuations in the Company's operating results,
general conditions in the computer hardware and software industries,
announcements of new products, technological innovations or new contracts by the
Company or by its competitors, developments with respect to patents, copyrights
or proprietary rights, general market conditions, and other factors. In
addition, in recent years the stock market in general, and the shares of
technology companies in particular, have experienced extreme price fluctuations.
These broad market and industry fluctuations, over which the Company has no
control, may materially and adversely affect the market price of the Common
Stock. In addition, shortfalls in sales or earnings as compared with securities
analysts' expectations, changes in such analysts' recommendations or projections
and general economic conditions may materially and adversely affect the market
price of the Common Stock.

SPECIAL NOTE ON FORWARD-LOOKING STATEMENTS

     Except for historical information contained herein, this Form 10-K contains
forward-looking statements within the meaning of Section 27A of the Securities
Act and Section 21E of the Exchange Act, and the Company intends that such
forward-looking statements be subject to the safe harbors created thereby. Such
forward-looking statements involve risks and uncertainties and include, but are
not limited to, statements regarding future events and the Company's plans and
expectations. The Company's actual results may differ materially from such
statements. Factors that cause or contribute to such differences include, but
are not limited to, those discussed above in "Factors That May Affect Future
Results," as well as those discussed elsewhere in this Form 10-K and the
documents incorporated herein by reference. Although the Company believes that
the assumptions underlying its forward-looking statements are reasonable, any of
the assumptions could prove to be inaccurate and, therefore, there can be no
assurance that the results contemplated in such forward-looking statements will
be realized. In addition, as disclosed above under "Factors That May Affect
Future Results," the business and operations of the Company are subject to
substantial risks that increase the uncertainties inherent in the forward-
looking statements included in this Form 10-K. The inclusion of such
forward-looking information should not be regarded as a representation by the
Company or any other person that the future events, plans or expectations
contemplated by the Company will be achieved.

ITEM 2. PROPERTIES

     SEEC's principal administrative, research and development, customer
support, and marketing facilities are located in approximately 16,000 square
feet of office space located within the greater Pittsburgh metropolitan area.
The current lease agreement expires in February 2003. In addition, SEEC leases
office space for regional sales offices located in or near Boston,
Massachusetts; Chicago, Illinois; Cincinnati, Ohio; Dallas, Texas, and
Washington, D.C. SEEC also leases office space in London, England and in Munich,
Germany for its European operations, and in Hyderabad, India; Seoul, South
Korea; and Singapore for its Asian operations. The Company anticipates that
additional facilities will be required in the future and believes that it will
be able to obtain suitable additional space as needed.

ITEM 3. LEGAL PROCEEDINGS

     SEEC is not a party to any material litigation.

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

     No matters were submitted to a vote of security holders during the fourth
quarter of fiscal 1999.

                                       19
<PAGE>   22

                                    PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED SHAREHOLDER MATTERS

     From January 22, 1997, the effective date of the Company's initial public
offering, through May 7, 1997, the Common Stock of the Company was traded on the
Nasdaq SmallCap Market tier of the Nasdaq Stock Market under the symbol "SEEC."
Beginning May 8, 1997 the Company's Common Stock began trading on the Nasdaq
National Market under the same symbol. The following table sets forth the range
of high and low sale prices of the Common Stock as reported on the Nasdaq Market
for the periods indicated.

          FISCAL YEARS ENDED MARCH 31,

<TABLE>
<CAPTION>
                                                              HIGH      LOW
                                                             ------    ------
<S>                                                          <C>       <C>
1997:
Fourth quarter (commencing January 22).....................  $11.25    $ 8.00
1998:
First quarter..............................................  $24.00    $ 8.13
Second quarter.............................................  $37.38    $16.38
Third quarter..............................................  $29.50    $14.00
Fourth quarter.............................................  $22.75    $11.25
1999:
First quarter..............................................  $15.88    $ 7.81
Second quarter.............................................  $13.00    $ 3.63
Third quarter..............................................  $11.00    $ 3.63
Fourth quarter.............................................  $ 5.88    $ 3.50
2000:
First quarter (through May 28, 1999).......................  $ 4.88    $ 3.50
</TABLE>

     As of May 28, 1999, there were approximately 3,000 beneficial owners of the
Company's Common Stock.

     The Company has never declared or paid cash dividends on its capital stock
and does not anticipate paying any cash dividends in the foreseeable future. The
Company currently anticipates that it will retain future earnings, if any, to
fund its operations.

                                       20
<PAGE>   23

ITEM 6. SELECTED FINANCIAL DATA

<TABLE>
<CAPTION>
                                                        FISCAL YEARS ENDED MARCH 31,
                                              ------------------------------------------------
                                               1999       1998       1997      1996      1995
                                              -------    -------    ------    ------    ------
                                                   (IN THOUSANDS, EXCEPT PER SHARE DATA)
<S>                                           <C>        <C>        <C>       <C>       <C>
CONSOLIDATED STATEMENT OF OPERATIONS DATA:
Revenues:
  Software license and maintenance fees.....  $ 7,936    $10,397    $1,242    $  372    $  393
  Professional services -- product
     related................................    3,099      1,832       776       181        42
  Professional services -- other............       63        187       605       476       350
                                              -------    -------    ------    ------    ------
          Total revenues....................   11,098     12,416     2,623     1,029       785
                                              -------    -------    ------    ------    ------
Operating expenses:
  Cost of revenues:
     Software license and maintenance
       fees.................................      813      1,434       252       102        92
     Professional services -- product
       related..............................    2,131      1,507       470        59        14
     Professional services -- other.........       64        178       513       439       243
                                              -------    -------    ------    ------    ------
          Total cost of revenues............    3,008      3,119     1,235       600       349
  General and administrative................    2,462      1,753       442       142       132
  Sales and marketing.......................    5,303      4,342       999       237       236
  Research and development..................    1,302      1,105       428       337       407
                                              -------    -------    ------    ------    ------
          Total operating expenses..........   12,075     10,319     3,104     1,316     1,124
                                              -------    -------    ------    ------    ------
Income (loss) from operations...............     (977)     2,097      (481)     (287)     (339)
Net interest income (expense)...............    1,608        778        85       (55)      (57)
                                              -------    -------    ------    ------    ------
Income (loss) before income taxes...........      631      2,875      (396)     (342)     (396)
Provision for income taxes..................      225        365        --        --        --
                                              -------    -------    ------    ------    ------
Net income (loss)...........................  $   406    $ 2,510    $ (396)   $ (342)   $ (396)
                                              =======    =======    ======    ======    ======
Net income (loss) per common share(1):
  Basic.....................................  $   .07    $   .49    $ (.13)   $ (.14)   $ (.16)
  Diluted...................................  $   .07    $   .46    $ (.13)   $ (.13)   $ (.16)
Weighted average number of common and common
  equivalent shares outstanding(1):
  Basic.....................................    5,954      5,145     3,037     2,507     2,501
  Diluted...................................    6,122      5,417     3,037     2,548     2,542
</TABLE>

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

(1) The Company has adopted Statement of Financial Accounting Standards No. 128,
    "Earnings per Share" ("SFAS No. 128"). This Statement established new
    guidelines for calculating earnings per share. The Company's Earnings (Loss)
    per Common Share figures have been restated to conform with the provisions
    of SFAS No. 128.

<TABLE>
<CAPTION>
                                                             AS OF MARCH 31,
                                           ---------------------------------------------------
                                            1999       1998       1997       1996       1995
                                           -------    -------    -------    -------    -------
                                                             (IN THOUSANDS)
<S>                                        <C>        <C>        <C>        <C>        <C>
CONSOLIDATED BALANCE SHEET DATA:
Cash, cash equivalents and short-term
  investments............................  $30,901    $30,829    $12,799    $   111    $   328
Working capital..........................   31,764     32,056     13,151        128        187
Total assets.............................   36,008     39,241     14,058        429        583
Advance royalty..........................       --         --        781        796        698
Deferred income taxes -- non-current.....      395         --         --         --         --
Other long-term obligations..............       --         --        150      1,042        858
Total shareholders' equity (deficit).....   33,242     34,024     12,344     (1,677)    (1,337)
</TABLE>

                                       21
<PAGE>   24

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
        RESULTS OF OPERATIONS

OVERVIEW

     SEEC develops, markets and provides integrated and comprehensive enterprise
solutions that enable large organizations and third-party service providers to
efficiently and effectively maintain and redevelop legacy system applications
and databases. The Company's enterprise solutions utilize a suite of software
products and well-defined, repeatable methodologies that are designed to
automate various functions and to improve the quality, productivity and
effectiveness of the reengineering process. SEEC introduced its core source code
analysis technology and the first PC-based reengineering software product in
1992.

     The Company was founded in 1988 to develop tools and solutions for
reengineering of legacy COBOL applications. In 1992, the Company commercially
introduced its first product, COBOL Analyst. From 1992 to 1996, the Company
devoted significant resources to developing its proprietary suite of products
for COBOL reengineering, including products for year 2000 impact analysis. In
fiscal 1995 and 1996, the Company introduced its COBOL Analyst 2000, COBOL
Slicer, LAN version of COBOL Analyst, and Date Analyzer products. In fiscal 1997
and 1998, the Company introduced Smart Change 2000, COBOL Slicer, Natural
Analyst 2000, AccuTest and other product line enhancements and extensions. In
fiscal 1999, the Company introduced SEEC IV & V Workbench, SEEC Reengineering
Workbench, SEEC Euro Workbench, SEEC Application Mosaic, and SEEC Application
Enhancement. The Company has continually enhanced its COBOL Analyst product
line.

     The Company derives its revenues primarily from software license and
maintenance fees, professional services fees, and sales through a distributor of
the Company's software products. The Company's software is licensed primarily to
Fortune 1000 companies, governmental organizations and third-party service
providers. Product-related services are provided to customers in conjunction
with the license of software products. Other professional services are primarily
programming services provided on a contract basis. The Company's enterprise
solutions and software products and services are marketed through a broad range
of distribution channels, including direct sales to end users, to end users in
conjunction with third-party service providers, to third-party service providers
and indirect sales through a distributor.

     The Company recognizes software license fees upon shipment of the software
to the customer, and resolution of any material related obligations. Typically,
software maintenance contracts are purchased with software licenses. Revenues
from software maintenance are deferred and recognized on a straight-line basis
over the contract period, which is generally one year. Software maintenance
contracts are typically renewable on an annual basis, although the Company also
enters into long-term maintenance contracts from time to time. Revenues from
professional services are recognized as the services are provided or upon the
achievement of specified performance milestones. See Note 1 to the Consolidated
Financial Statements.

                                       22
<PAGE>   25

RESULTS OF OPERATIONS

     The following table sets forth, for the periods indicated, the percentage
of total revenues represented by certain income and expense items.

<TABLE>
<CAPTION>
                                                               FISCAL YEARS ENDED
                                                                   MARCH 31,
                                                              --------------------
                                                              1999    1998    1997
                                                              ----    ----    ----
<S>                                                           <C>     <C>     <C>
REVENUES:
  Software license and maintenance fees.....................   71%     84%     48%
  Professional services -- product related..................   28      15      29
  Professional services -- other............................    1       1      23
                                                              ---     ---     ---
          Total revenues....................................  100     100     100
                                                              ---     ---     ---
OPERATING EXPENSES:
  Cost of revenues:
     Software license and maintenance fees..................    7      12      10
     Professional services -- product related...............   19      12      17
     Professional services -- other.........................    1       1      20
                                                              ---     ---     ---
          Total cost of revenues............................   27      25      47
  General and administrative................................   22      14      17
  Sales and marketing.......................................   48      35      38
  Research and development..................................   12       9      16
                                                              ---     ---     ---
          Total operating expenses..........................  109      83     118
                                                              ---     ---     ---
Income (loss) from operations...............................   (9)     17     (18)
Net interest income.........................................   15       6       3
                                                              ---     ---     ---
Income (loss) before income taxes...........................    6      23     (15)
Provision for income taxes..................................    2       3      --
                                                              ---     ---     ---
Net income (loss)...........................................    4%     20%    (15)%
                                                              ===     ===     ===
</TABLE>

COMPARISON OF FISCAL YEARS ENDED MARCH 31, 1999 AND MARCH 31, 1998

     Revenues.  Total revenues for fiscal 1999 were $11,098,000 compared to
$12,416,000 for fiscal 1998, a decrease of $1,318,000, or 11%. The decrease in
revenues resulted primarily from a decrease in the demand for year 2000 tools
and solutions, partially offset by a substantial increase in the demand for
professional services -- product related.

     Software license and maintenance fees were $7,936,000 for fiscal 1999
compared to $10,397,000 for fiscal 1998, a decrease of $2,461,000 or 24%. The
decrease in software license and maintenance fees is attributable to a decrease
in demand for year 2000 tools and solutions. Also contributing to the decrease
in software license and maintenance fee revenue is the one-time revenue
recognition of the $781,000 advance royalty from Viasoft, which occurred in
fiscal 1998. See "Business -- Sales, Marketing, and Distribution" and Note 8 to
the Consolidated Financial Statements.

     Professional services -- product related revenues consist of consulting,
training and reengineering services fees related directly to product licenses
from the Company, primarily the Company's year 2000 products. Such revenues were
$3,099,000 for fiscal 1999 compared to $1,832,000 million for fiscal 1998, an
increase of $1,267,000 or 69%. These increases are primarily attributable to (1)
customers' increased demand for on-site assistance with their year 2000
projects, (2) additional training and consulting services, typically provided in
conjunction with software license sales, and (3) additional in-house assessment,
renovation, and independent verification ("IV") services performed at the
Company's offices. In fiscal 1999, more so than in fiscal 1998, the Company
provided extended-term, on-site services to customers on a time-and-materials
basis. Either Company employees or subcontracted professionals may deliver the
on-site services, depending on the nature of the engagements and staffing
requirements. The Company's in-house factory services revenues comprised a
larger percentage of total revenues in fiscal 1999 than in fiscal 1998. These
proportions of in-house factory services revenues to total revenues are not
necessarily representative of the results that can be expected in future

                                       23
<PAGE>   26

periods. The Company expects that training, consulting, and on-site services
will be the primary components of product-related professional services revenue
for the foreseeable future.

     Revenues from professional services -- other consist of contract
programming fees for projects unrelated to the license of the Company's software
products. Such revenues were $63,000 for fiscal 1999 compared to $187,000 for
fiscal 1998, a decrease of $124,000 or 66%. The Company has chosen to direct its
resources away from contract programming services, and thus these revenues have
declined steadily since fiscal 1997. Contract programming services were
discontinued during fiscal 1999. Currently, management has no plans to continue
to provide services of this type.

     Cost of Revenues.  Cost of revenues includes cost of software license and
maintenance fees, cost of professional services -- product related, and cost of
professional services -- other. Cost of revenues consists primarily of personnel
costs of employees or subcontracted personnel required to provide consulting,
training, on-site or in-house factory services, and customer support services.
Also included in the cost of software license and maintenance fees and cost of
professional services -- product related are royalties that the Company paid to
ICICI for each product sold or service provided, and to Viasoft for certain
products.

     The Company's total cost of revenues was $3,008,000 for fiscal 1999,
compared to $3,119,000 for fiscal 1998, representing a decrease of $111,000, or
4%. The primary reasons for the decrease in cost of revenues were the decrease
in demand for year 2000 services and solutions and the elimination of royalties
payable to ICICI and Viasoft. The decrease in cost of revenues was
proportionately less than the decrease in revenues because of the increase in
the proportion of lower-margin professional services -- product related versus
higher-margin software license and maintenance fees.

     Cost of software license and maintenance fees includes royalty expenses,
the costs of providing customer support and the costs of media, manuals,
duplication and shipping related to the sales of the Company's software
products. Customer support is primarily telephone support for customers who have
purchased maintenance in conjunction with software license purchases. Cost of
software license and maintenance fees was $813,000 for fiscal 1999 compared to
$1,434,000 for fiscal 1998, a decrease of $621,000 or 43%. This decrease was
primarily attributable to royalties payable to ICICI, which were included in the
expenses for fiscal 1998. The Company's royalty obligation was fulfilled in
January 1998, during the fourth quarter of fiscal 1998. The decrease in costs
resulting from the elimination of ICICI royalties was offset, to a limited
extent, by the increase in costs for customer support related to additional
maintenance contracts entered into during fiscal 1998 and 1999.

     Professional services -- product related costs consist primarily of
compensation and related benefits, and travel and equipment for Company
personnel responsible for providing consulting, training and reengineering
services to customers. Also included are the costs of temporary or subcontracted
labor required on occasion to meet the demands for providing services.
Professional services -- product related costs were $2,131,000 for fiscal 1999
compared to $1,507,000 for fiscal 1998, an increase of $624,000 or 41%. This
increase was primarily attributable to increased consulting, training, and
factory services performed during fiscal 1999. The Company has expanded its
professional services infrastructure to meet the demand for its solutions and
services.

     Professional services -- other costs consist primarily of compensation and
related benefits for Company personnel engaged in providing contract programming
services for customers. Professional services -- other costs were $64,000 for
fiscal 1999 compared to $178,000 for fiscal 1998, a decrease of $114,000 or 64%.
The decrease corresponds to the decline in contract programming services, which
ceased in October 1998.

     Gross Margins.  The Company's total gross margin (total revenues less total
cost of revenues) as a percentage of revenues was 73% for fiscal 1999 as
compared to 75% for fiscal 1998. The decrease in the total gross margin was
primarily attributable to the decrease in software license and maintenance fees
as a percentage of total revenue and a corresponding increase in professional
services revenue as a percentage of total revenue. Software license and
maintenance fees and professional services -- product related represented 72%
and 28%, respectively, of total revenue for fiscal 1999 compared to 84% and 15%
for fiscal 1998. Software license and maintenance fees have higher gross margins
than professional services fees.

                                       24
<PAGE>   27

     Gross margin percentages were 90% and 86% for software license and
maintenance fees, 31% and 18% for professional services -- product related, and
(1)% and 5% for professional services -- other, for fiscal 1999 and 1998,
respectively.

     The gross margin percentages for software license and maintenance fees
fluctuate depending on the mix of software products and the varying royalty
expenses associated with those products. The gross margin percentages for
software license and maintenance fees and professional services -- product
related were favorably impacted by the discontinuation after January 1998 of the
royalties payable to ICICI. The gross margin percentages for professional
services -- product related vary depending on the type of services provided and
the timing and amount of costs incurred to build up the professional services
infrastructure. Services that are relatively highly automated, such as year 2000
assessments and IV, typically require fewer professional hours to perform than
services involving planning, source code remediation or testing. Furthermore,
the Company's pricing for product-related services varies based on the
complexity and scope of the engagement and competitive considerations. The
professional services -- product related gross margin percentage in fiscal 1999
reflects the benefits of having a professional staff in place and in a
revenue-producing mode. In fiscal 1998, additional costs were incurred for
recruiting, hiring, training, and purchasing equipment for new professionals.
This divergence of costs and revenues in a particular period is likely to recur,
therefore continuing to have a varying impact on gross margin percentages.

     The gross margin percentages for professional services -- other fluctuate
based on the prices of the individual service contracts, the Company's payroll
and other costs of professional staff providing the services, and the
proportionate contribution of each contract to the total revenue for this
category during the period. The Company has discontinued these services in
fiscal 1999.

     Sales and Marketing.  Sales and marketing expenses consist primarily of
salaries, incentive compensation and related benefits of the Company's sales,
sales support, and marketing personnel, plus the costs of travel, advertising,
and other promotional activities. Sales and marketing expenses were $5,303,000
for the fiscal year 1999 compared to $4,342,000 for fiscal 1998, an increase of
$961,000 or 22%. The increase was primarily due to the Company's continued
efforts to increase the direct sales and marketing of its products and solutions
to customers. The Company established operations in the United Kingdom and India
during fiscal 1998. In fiscal 1999, the Company established operations in
Germany, South Korea, and Singapore, and also expanded its sales and marketing
activities in Latin America. The Company continues to recruit and hire personnel
for its domestic and international sales efforts, while increasing global market
awareness of the Company's products and solutions through expanded advertising
and other promotional activities.

     General and Administrative.  General and administrative expenses include
the costs of general management, finance, legal, accounting, office facilities,
communications, and other administrative functions. General and administrative
expenses were $2,462,000 for fiscal 1999 compared to $1,753,000 for fiscal 1998,
an increase of $709,000 million or 40%. This increase is primarily due to
continued investment in the Company's infrastructure, and international
expansion to the United Kingdom, Germany, India, Korea, and Singapore. The
additional payroll and payroll-related costs, rent, insurance, and professional
service costs reflect the Company's expansion of operations and the addition of
staff.

     Research and Development.  Total expenditures for research and development
were $1,302,000 in fiscal 1999 compared to $1,105,000 in fiscal 1998, an
increase of $197,000 or 18%. This increase is due to additional research and
development personnel costs and related facilities, computer equipment, and
benefits costs, including the additional costs attributable to the acquisition
described in Note 3 to the Consolidated Financial Statements. During fiscal
1998, research and development expenses included fees paid on a work-for-hire
basis to ERA for certain projects performed offshore. The research and
development services formerly provided to the Company by ERA are now provided by
SEEC Asia. Expenditures for research and development will vary depending upon
the number of projects underway at any time, the size of the projects, and their
stage of development.

     Net Interest Income.  Net interest income includes interest income and
interest expense. Net interest income was $1,608,000 in fiscal 1999, compared to
$778,000 in fiscal 1998, an increase of 107%. The increase in net interest
income in fiscal 1999 was due to interest earned on the proceeds from the
Company's secondary public
                                       25
<PAGE>   28

offering in February 1998. The net proceeds were invested in money market funds
and high-grade bond funds with average maturities of less than two years.

     The Company incurred interest expense of $26,000 in fiscal 1998, consisting
primarily of interest on the Company's loan payable to ICICI, and also interest
on accrued but unpaid royalties payable to ICICI. The ICICI loan was paid in
full on June 30, 1997, and all royalty-related obligations to ICICI were
fulfilled during fiscal 1998.

     Income Taxes.  The provision for income taxes was $225,000 and $365,000 for
fiscal 1999 and 1998, respectively, resulting in effective tax rates of 36% and
13%, respectively. The Company's effective tax rate was affected by the
availability of net operating loss carryforwards, which reduced the Company's
federal tax liability for fiscal 1999 and 1998, and eliminated the Company's
federal tax liability in fiscal 1997. See Note 13 to Consolidated Financial
Statements.

COMPARISON OF FISCAL YEARS ENDED MARCH 31, 1998 AND MARCH 31, 1997

     Revenues.  Total revenues for fiscal 1998 were $12,416,000 compared to
$2,623,000 for fiscal 1997, an increase of $9,793,000, or 373%. The increase in
revenues resulted primarily from increases in software license and maintenance
fees, including approximately $781,000 attributable to the revenue recognition
of the non-recurring advance royalty from Viasoft. See "Business -- Sales,
Marketing, and Distribution" and Note 8 to the Consolidated Financial
Statements. The increase also resulted, to a lesser extent, from increased
professional services -- product related revenues which was offset, in
substantial part, by a planned decrease in professional services -- other
revenues.

     Software license and maintenance fees were $10,397,000 for fiscal 1998
compared to $1,242,000 for fiscal 1997, an increase of $9,155,000 or 737%. The
increase in software license and maintenance fees is attributable to (1) the
Company's recent build-up of its sales and marketing infrastructure to market
its products and solutions directly to end users, (2) new product introductions
and increased customer awareness of the year 2000 problem, both of which
resulted in higher demand for the Company's tools and solutions, (3) expanded
distribution of the Company's products and solutions through ERA and third-party
service providers, and (4) revenue recognition of the $781,000 advance royalty
from Viasoft, which occurred in the first quarter of fiscal 1998.

     Professional services -- product related revenues consist of consulting,
training and reengineering services fees related directly to product licenses
from the Company, primarily the Company's year 2000 products. Such revenues were
$1,832,000 for fiscal 1998 compared to $776,000 for fiscal 1997, an increase of
$1,056,000 or 136%. These increases are primarily attributable to increased year
2000 assessment and remediation services performed during fiscal 1998.

     Revenues from professional services -- other consist of contract
programming fees for projects unrelated to the license of the Company's software
products. Such revenues were $187,000 for fiscal 1998 compared to $604,000 for
fiscal 1997, a decrease of $417,000 or 69%. The Company has been redirecting its
programming resources to meet increased demand for its year 2000 products and
services. As a result, revenues from professional services -- other have been
steadily decreasing since the second quarter of fiscal 1997 and are not expected
to comprise a significant portion of overall revenues in the future.

     Cost of Revenues.  Cost of revenues includes cost of software license and
maintenance fees, cost of professional services -- product related, and cost of
professional services -- other. Included in the cost of software license and
maintenance fees and cost of professional services -- product related are
royalties which the Company paid to ICICI for each product sold or service
provided, and to Viasoft for certain products and services. Through December 31,
1996, the Company had also paid royalties to ERA. Such royalty payments were
eliminated effective January 1, 1997 by mutual agreement between the Company and
ERA.

     The Company's total cost of revenues was $3,119,000 for fiscal 1998,
compared to $1,235,000 for fiscal 1997, representing an increase of $1,884,000
or 153%. The increase was primarily attributable to the additional costs of
royalties and personnel required to provide customer support and year 2000
services. Both the additional royalty and personnel costs were directly related
to increased revenues.

                                       26
<PAGE>   29

     Cost of software license and maintenance fees includes the costs of
providing customer support and the costs of media, manuals, duplication and
shipping related to the sales of the Company's software products. Customer
support is primarily telephone support for customers who have purchased
maintenance in conjunction with software license purchases. Cost of software
license and maintenance fees was $1,434,000 for fiscal 1998 compared to $252,000
for fiscal 1997, an increase of 469%. This increase was primarily attributable
to increased royalty expenses, particularly royalties payable to ICICI. Royalty
expense is calculated as a percentage of revenues from sales of software
products specified in the ICICI and Viasoft agreements. In addition, the Company
incurred increased costs for customer support related to additional maintenance
contracts entered into during fiscal 1998.

     Professional services -- product related costs consist primarily of
compensation and related benefits, and travel and equipment for Company
personnel responsible for providing consulting, training and reengineering
services to customers. Also included are the costs of temporary or subcontracted
labor required on occasion to meet the demands for providing services.
Professional services -- product related costs were $1,507,000 for fiscal 1998
compared to $470,000 for fiscal 1997, an increase of $1,037,000 or 221%. This
increase was primarily attributable to services related to increased purchases
of the Company's Smart Change Factory solution and increased year 2000
assessment and remediation services performed in fiscal 1998. The Company has
built up its professional services infrastructure to address increasing demand
for its year 2000 products and solutions.

     Professional services -- other costs consist primarily of compensation and
related benefits for Company personnel engaged in providing contract programming
services for customers. Professional services -- other costs were $178,000 for
fiscal 1998 compared to $513,000 for fiscal 1997, a decrease of $335,000 or 65%.
The decrease corresponds to the decline in contract programming services
provided during fiscal 1998.

     Gross Margins.  The Company's total gross margin (total revenues less total
cost of revenues) as a percentage of revenues was 75% for fiscal 1998 as
compared to 53% for fiscal 1997. The increase in the total gross margin was
primarily attributable to the increase in software license and maintenance fees
as a percentage of total revenue. Software license and maintenance fees
represented 84% of total revenue for fiscal 1998 compared to 47% for fiscal
1997. Software license and maintenance fees have higher gross margins than
professional service fees.

     Gross margin percentages were 86% and 80% for software license and
maintenance fees, 18% and 39% for professional services -- product related, and
5% and 15% for professional services -- other, for fiscal 1998 and 1997,
respectively. The increase in the gross margin percentage for software license
and maintenance fees was primarily attributable to the discontinuation of the
royalties payable to ERA, effective January 1, 1997. Offsetting that impact, in
part, was the Company's increased investment in customer support during fiscal
1998. Gross margin percentages for software license and maintenance fees
fluctuate depending on the mix of software products and the royalty expenses
associated with those products.

     The gross margin percentages for professional services -- product related
vary depending on the type of services provided and the timing and amount of
costs incurred to build up the professional services infrastructure. Services
that have higher degrees of automation, such as year 2000 inventory and impact
assessments, typically require fewer professional hours to perform than services
involving planning, source code remediation or testing. Furthermore, the
Company's pricing for product-related services varies based on the complexity
and scope of the engagement and competitive considerations. The professional
services -- product related gross margin percentage of 18% during fiscal 1998
reflected additional costs incurred for recruiting, hiring, training and
purchasing equipment for new professionals. The Company was building its
professional services infrastructure, typically in advance of contract signing
and commencement of services, so that adequate resources were available to meet
the continuing demand for year 2000 products and solutions. While these costs
are likely to recur, the timing and amounts are expected to fluctuate from
period to period and will therefore have a varying impact on gross margin
percentages. Furthermore, the gross margin percentage of 39% during fiscal 1997
was higher due to a greater level of automated services performed in the period.

     The gross margin percentages for professional services -- other fluctuate
based on the prices of the individual service contracts, the Company's payroll
and other costs of professional staff providing the services, and the
proportionate contribution of each contract to the total revenue for this
category during the period.
                                       27
<PAGE>   30

     Sales and Marketing.  Sales and marketing expenses consist primarily of
salaries, incentive compensation and related benefits of the Company's sales,
sales support, and marketing personnel, plus the costs of travel, advertising,
and other promotional activities. Sales and marketing expenses were $4,342,000
for the fiscal year 1998 compared to $999,000 for fiscal 1997, an increase of
$3,343,000 or 335%. This increase was primarily due to the Company's decision to
increase the direct sales and marketing of its products and solutions to
customers to address year 2000 revenue opportunities. Spending accelerated in
the latter part of fiscal 1997 and continued through fiscal 1998, as funds
raised in the Company's initial and second public offerings were used to recruit
and hire sales and sales support personnel, to add domestic and international
sales offices and to increase market awareness of the Company's products and
solutions through expanded advertising, participation in trade shows and
conferences, and other promotional activities.

     General and Administrative.  General and administrative expenses include
the costs of general management, finance, legal, accounting, office facilities,
communications, and other administrative functions. General and administrative
expenses were $1,753,000 for fiscal 1998 compared to $442,000 for fiscal 1997,
an increase of $1,311,000 or 297%. These increases are primarily due to
additional payroll and related costs, rent, insurance and professional service
costs, reflective of the Company's growth and expanded operations and costs
associated with being a public company.

     Research and Development.  Total expenditures for research and development
were $1,105,000 in fiscal 1998 compared to $428,000 in fiscal 1997, an increase
of $677,000 or 158%. Expenditures for research and development vary depending
upon the number of projects underway at any time, the size of the projects,
their stage of development, and the in-house versus off-shore components of the
project costs. The Company utilized the resources of ERA for certain research
and development. Furthermore, during fiscal 1997, the Company temporarily
redirected some professional research and development staff to meet the
increased demand for year 2000 services.

     Net Interest Income.  Net interest income includes interest income and
interest expense. Net interest income was $778,000 in fiscal 1998 compared to
$85,000 in fiscal 1997, an increase of $693,000 or 815%.

     Interest income was $804,000 in fiscal 1998 compared to $135,000 in fiscal
1997, representing a 496% increase. This increase was due primarily to interest
earned on the net proceeds from the Company's initial public offering in January
1997 and also from the follow-on offering in February 1998. The proceeds are
invested in money market funds and high-grade government and corporate bonds and
bond funds with average maturities of less than two years.

     Interest expense consists of accrued interest on indebtedness and interest
on accrued but unpaid royalties payable to ICICI. Interest expense for fiscal
1998 was $26,000 compared to $50,000 in fiscal 1997, a decrease of $24,000, or
48%. Until July 1996, interest expense included interest on notes and advances
payable to certain directors and shareholders, and deferred salaries of two
officers and shareholders. These interest-bearing obligations were converted to
shares of the Company's Common Stock in July 1996. Interest expense on the
Company's indebtedness to ICICI was included in all twelve months of fiscal
1997, but only three months of interest expense was included in fiscal 1998. The
ICICI loan was paid in full on June 30, 1997.

     Income taxes.  The provision for income taxes was $365,000 in fiscal 1998.
No provision for income taxes was recorded in fiscal 1997. In fiscal 1997, the
Company had calculated a net deferred tax asset, which was offset by a valuation
allowance. The valuation allowance was eliminated in fiscal 1998 based on future
taxable income arising from the reversals of existing taxable temporary
differences. The Company's effective tax rate was 13% in fiscal 1998, which was
substantially less than the statutory rates because of the elimination of the
valuation allowance. See Note 13 to the Consolidated Financial Statements.

LIQUIDITY AND CAPITAL RESOURCES

     The Company has funded its operations primarily through sales of equity
securities and positive cash flows from operations. In fiscal 1997, the Company
sold 211,425 shares of Common Stock in a private placement for $747,000, and
sold 2,070,000 shares of Common Stock in an initial public offering, the net
proceeds of which

                                       28
<PAGE>   31

were $13.0 million. In fiscal 1998, the Company sold 1,030,000 shares of Common
Stock in a secondary public offering, the net proceeds of which were $19.1
million.

     At March 31, 1999, the Company had cash, cash equivalents, and short-term
investments of $30.9 million, and working capital of $31.8 million. At March 31,
1998, the Company had cash, cash equivalents, and short-term investments of
$30.8 million and working capital of $32.1 million.

     The Company's cash flows have been used primarily for general operating
expenses, to purchase equipment, furniture and leasehold improvements, and to
fund internal research and development. In addition, in fiscal 1999, the Company
purchased 278,900 shares of its Common Stock for $1,302,000 under the stock
repurchase program described in Note 2 to the Consolidated Financial Statements.
Also in fiscal 1999, the Company paid $1,036,000 to satisfy its obligation in
connection with the acquisition of an affiliate, as described in Note 3 to the
Consolidated Financial Statements.

     The Company's cash balances may be used to develop international sales and
marketing efforts, expand domestic sales and marketing efforts, establish
additional facilities, hire additional personnel, increase research and
development for enterprise solutions, increase capital expenditures and for
working capital and other general corporate purposes. The Company may utilize
cash to develop or acquire other businesses, products or technologies
complementary to its current business. The amounts actually expended for each
such purpose may vary significantly and are subject to change at the Company's
discretion, depending upon certain factors, including economic or industry
conditions, changes in the competitive environment and strategic opportunities
that may arise. Management believes that cash flows from operations and the
current cash balances will be sufficient to meet the Company's liquidity needs
for the foreseeable future. In the longer term, the Company may require
additional sources of capital to fund future growth. Such sources of capital may
include additional equity offerings or debt financings.

IMPACT OF INFLATION

     Increases in the inflation rate are not expected to materially affect the
Company's operating results. Inflationary cost increases have not been material
in recent years, and to the extent allowed in light of competitive pressures,
such increases are passed on to customers through increased billing rates.

FOREIGN CURRENCY TRANSLATION

     The overall effects of foreign currency exchange rates on the Company's
business during the periods discussed have not been material. Movements in
foreign currency exchange rates create a degree of risk to the Company's
operations if those movements affect the dollar value of costs incurred in
foreign currencies. Substantially all of the Company's billings to date have
been denominated in U.S. dollars. Changing currency exchange rates may affect
the Company's competitive position if exchange rate changes impact profitability
and business and/or pricing strategies of non-U.S. based competitors.

     The functional currency of the Company's wholly-owned subsidiaries is the
U.S. dollar. Assets and liabilities of these subsidiaries are translated at the
current exchange rate at the balance sheet date. Expenses are translated using
the average exchange rate during the period.

SEASONALITY

     The Company's operations are not affected by seasonal fluctuations,
although the Company's cash flows may at times be affected by fluctuations in
the timing of cash receipts from large individual sales.

YEAR 2000 CONSIDERATIONS

     The year 2000 problem refers to the inability of many existing computer
systems to completely or accurately process information or logic involving the
year 2000 and beyond. The problem results from the use of two-digit date fields
to perform computations and decision-making functions in many computer systems.
For example, a program using a two-digit date field may misinterpret "00" as the
year 1900 rather than 2000. Date-dependent programs are ubiquitous in computer
systems used in many critical business operations. Unless these programs
                                       29
<PAGE>   32

are remediated to address the year 2000 problem, many mission-critical programs
may fail or produce erroneous data or results.

     The Company has established a formal program to address any potential year
2000 compliance issues relating to its internal operating systems, products,
distributors, resellers and vendors. The Company has reviewed all of its major
internal operating systems and is continuing to monitor any new additions to its
internal operating systems for year 2000 compliance. Substantially all of the
Company's internally-developed products have been designed and tested to satisfy
the Company's year 2000 specifications. The Company is currently reviewing the
status of its distributors, resellers and vendors regarding year 2000
compliance. The Company believes that the risk of disruption of the Company's
operations due to the year 2000 problem is minimal. However, the Company relies
upon various third-party organizations for basic services such as electrical
power, telecommunications, postage and delivery, banking, and other
infrastructure services. In a worst-case scenario, the Company could suffer
adverse consequences as a result of interruption of some or all of these
services. These third-party dependencies are not unique to the Company or to
companies in its industry or geographical location. Disruptions in these
infrastructure services would likely have a negative impact on most business
enterprises. The Company is currently developing specific contingency plans to
operate during such disruptions in infrastructure services.

     The cost of the Company's year 2000 compliance program is not expected to
have a material effect on the Company's results of operations or liquidity. To
date, the Company has not incurred significant costs with respect to its year
2000 compliance efforts, and anticipates that total expenses will not exceed
$10,000. However, there can be no assurance that the Company will not experience
material adverse consequences in the event that the Company's year 2000
compliance program is not successful, or its distributors, resellers or vendors
are unable to resolve their year 2000 compliance issues in a timely manner.

OTHER

     Statement of Financial Accounting Standards No. 130, "Reporting
Comprehensive Income," ("SFAS No. 130") establishes standards for reporting and
display of comprehensive income, its components, and accumulated balances.
Comprehensive income includes all changes in equity except those resulting from
investments by owners and distributions to owners. SFAS No. 130 requires that an
enterprise display the components of comprehensive income for each period
presented. The Company adopted SFAS No. 130 effective April 1, 1998. Comparative
information for prior periods is presented in the Financial Statements. Results
of operations and financial position were not affected by the implementation of
this standard. The Company's comprehensive income (loss) is disclosed on the
Consolidated Statement of Shareholders' Equity (Deficit) for each period
presented.

     Statement of Financial Accounting Standards No. 131, "Disclosures about
Segments of an Enterprise and Related Information," ("SFAS No. 131") establishes
standards for the way that public companies report selected information about
operating segments in annual financial statements and requires reporting
selected information about operating segments in interim financial statements
issued to the public. It also establishes standards for disclosures regarding
products and services, geographic areas, and major customers. The Company
adopted SFAS No. 131 effective April 1, 1998. The Company operates in one
industry segment. Geographic information and major customers are disclosed in
Note 5 to the Consolidated Financial Statements.

     Statement of Financial Accounting Standards No. 132, "Employers'
Disclosures about Pensions and Other Postretirement Benefits," ("SFAS No. 132")
revises employers' disclosures about pension and other postretirement benefit
plans. SFAS No. 132 does not change the measurement or recognition of those
plans. SEEC currently has no pension benefit plans for its employees and as such
is not subject to the disclosure requirements of this Statement.

     Statement of Financial Accounting Standards No. 133, "Accounting for
Derivative Instruments and Hedging Activities" ("SFAS No. 133") was issued in
June 1998. SFAS No. 133 is effective for all fiscal quarters beginning after
June 15, 1999. SFAS No. 133 requires that all derivative financial instruments
be recognized as either assets or liabilities on the balance sheet at fair
value. Gains and losses of derivative financial instruments not designated as
hedges are to be recognized in earnings. The Company currently has no derivative
financial instruments, and as such, will not be subject to the requirements of
SFAS No. 133.
                                       30
<PAGE>   33

     On April 1, 1998 the Company adopted Statement of Position No. 97-2,
"Software Revenue Recognition" ("SOP 97-2"), which specifies the criteria that
must be met for recognizing revenues from software sales The adoption of SOP
97-2 has not had a material effect on the Company's financial position or
results of operations.

ITEM 7A. MARKET RISK

     Interest Rate Risk.  The Company's exposure to market rate risk for changes
in interest rates relates primarily to the Company's cash equivalent
investments. The Company has not used derivative financial instruments. The
Company invests its excess cash in short-term, floating-rate instruments that
carry a degree of interest rate risk. These instruments may produce less income
than expected if interest rates fall.

     Foreign Currency Risk.  The Company's international business is subject to
risks typical of an international business including, but not limited to,
differing economic conditions, changes in political climate, differing tax
structures, other regulations and restrictions, and foreign exchange rate
volatility. Accordingly, the Company's future results could be materially and
adversely impacted by changes in these or other factors. The Company is exposed
to foreign currency exchange rate fluctuations as the financial results of its
foreign subsidiaries are translated into U.S. dollars in consolidation. As
exchange rates vary, these results, when translated, may vary from expectations
and adversely impact overall profitability. The effect of foreign exchange rate
fluctuations on the Company has not been material.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

     See Item 14 below and the index therein for a listing of financial
statements and supplementary data filed as part of this report.

                                       31
<PAGE>   34

                                   SEEC, INC.

            INDEX TO CONSOLIDATED FINANCIAL STATEMENTS AND SCHEDULE

<TABLE>
<CAPTION>
                                                                PAGE
                                                                ----
<S>                                                            <C>
Report of Independent Certified Public Accountants..........      33
Consolidated Balance Sheets.................................      34
Consolidated Statements of Operations.......................      35
Consolidated Statements of Changes in Shareholders' Equity
  (Deficit).................................................      36
Consolidated Statements of Cash Flows.......................      37
Notes to Consolidated Financial Statements..................   38-50
Schedule II -- Valuation And Qualifying Accounts............      54
</TABLE>

                                       32
<PAGE>   35

               REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

To the Shareholders and
Board of Directors
SEEC, Inc.
Pittsburgh, Pennsylvania

     We have audited the accompanying consolidated balance sheets of SEEC, Inc.
and subsidiaries as of March 31, 1999 and 1998, and the related consolidated
statements of operations, changes in shareholders' equity (deficit), and cash
flows for each of the three years in the period ended March 31, 1999. We have
also audited the schedule listed in the accompanying index. These financial
statements and schedule are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements and
schedule 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 and schedule are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements and
schedule. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
presentation of the financial statements and schedule. 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 consolidated financial position of SEEC, Inc. and
subsidiaries as of March 31, 1999 and 1998, and the consolidated results of
their operations and their cash flows for each of the three years in the period
ended March 31, 1999, in conformity with generally accepted accounting
principles.

     Also, in our opinion, the schedule presents fairly, in all material
respects, the information set forth therein.

                                          BDO Seidman, LLP

Boston, Massachusetts
May 19, 1999

                                       33
<PAGE>   36

                                   SEEC, INC.

                          CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                      MARCH 31,
                                                              --------------------------
                                                                 1999           1998
                                                              -----------    -----------
<S>                                                           <C>            <C>
                           ASSETS
CURRENT ASSETS:
  Cash and cash equivalents.................................  $22,448,176    $23,795,965
  Short-term investments (Note 4)...........................    8,452,685      7,032,550
  Accounts receivable:
     Trade -- less allowance for doubtful accounts of
      $210,000 and $50,000 at March 31, 1999 and 1998,
      respectively (Notes 5 and 10).........................    2,701,438      5,709,495
     Affiliate -- ERA (Notes 7 and 8).......................           --        189,097
  Prepaid expenses and other current assets.................      532,910        545,980
                                                              -----------    -----------
          Total current assets..............................   34,135,209     37,273,087
PROPERTY AND EQUIPMENT, NET (Notes 6 and 10)................    1,102,520      1,115,659
GOODWILL AND OTHER INTANGIBLE ASSETS, LESS
  ACCUMULATED AMORTIZATION of $155,436 and $10,000 at March
     31, 1999 and 1998, respectively (Note 3)...............      770,378        852,000
                                                              -----------    -----------
                                                              $36,008,107    $39,240,746
                                                              ===========    ===========
            LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
  Accounts payable:
     Trade..................................................  $   625,984    $ 1,053,253
     Affiliate -- ERA (Notes 7 and 8).......................           --        230,085
  Obligation to ERA in connection with acquisition (Note
     3).....................................................           --      1,036,000
  Accrued payroll, related taxes and withholdings...........      399,044        823,372
  Accrued royalties (Notes 7 and 8).........................       19,025        224,206
  Other accrued expenses....................................      428,107        522,220
  Deferred maintenance revenue..............................      703,147        924,039
  Customer advance..........................................           --         31,705
  Income taxes payable (Note 13)............................      195,800             --
  Deferred income taxes (Note 13)...........................           --        372,330
                                                              -----------    -----------
          Total current liabilities.........................    2,371,107      5,217,210
DEFERRED INCOME TAXES (Note 13).............................      394,960             --
                                                              -----------    -----------
          Total liabilities.................................    2,766,067      5,217,210
                                                              -----------    -----------
COMMITMENTS AND CONTINGENCIES (Notes 7, 8, 11, 12 and 16)
SHAREHOLDERS' EQUITY (Notes 2, 9, 11 and 15):
  Preferred stock -- no par value; 10,000,000 shares
     authorized; none outstanding...........................
  Common stock -- $.01 par value; 20,000,000 shares
     authorized; 6,084,147 and 6,076,546 issued at March 31,
     1999 and 1998, respectively............................       60,842         60,765
  Additional paid-in capital................................   33,576,796     33,566,408
  Retained earnings.........................................      766,569        382,047
  Less treasury stock, at cost -- 255,960 shares............   (1,182,496)            --
  Accumulated other comprehensive income....................       20,329         14,316
                                                              -----------    -----------
          Total shareholders' equity........................   33,242,040     34,023,536
                                                              -----------    -----------
                                                              $36,008,107    $39,240,746
                                                              ===========    ===========
</TABLE>

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

                                       34
<PAGE>   37

                                   SEEC, INC.

                     CONSOLIDATED STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
                                                                 YEAR ENDED MARCH 31,
                                                       ----------------------------------------
                                                          1999           1998           1997
                                                       -----------    -----------    ----------
<S>                                                    <C>            <C>            <C>
REVENUES (Note 5):
  Software license and maintenance fees (Notes 7 and
     8)..............................................  $ 7,935,642    $10,397,418    $1,241,911
  Professional services -- product related...........    3,099,396      1,832,197       776,287
  Professional services -- other.....................       63,469        185,994       604,466
                                                       -----------    -----------    ----------
          Total revenues.............................   11,098,507     12,415,609     2,622,664
                                                       -----------    -----------    ----------
OPERATING EXPENSES:
  Cost of revenues:
     Software license and maintenance fees (Notes 7
       and 8)........................................      813,455      1,434,270       252,368
     Professional services -- product related........    2,130,638      1,506,865       470,159
     Professional services -- other (Note 7).........       64,390        177,542       512,559
                                                       -----------    -----------    ----------
          Total cost of revenues.....................    3,008,483      3,118,677     1,235,086
  General and administrative (Note 12)...............    2,461,822      1,753,083       441,717
  Sales and marketing................................    5,303,120      4,342,323       999,496
  Research and development (Note 7)..................    1,302,391      1,104,732       427,490
                                                       -----------    -----------    ----------
          Total operating expenses...................   12,075,816     10,318,815     3,103,789
                                                       -----------    -----------    ----------
INCOME (LOSS) FROM OPERATIONS........................     (977,309)     2,096,794      (481,125)
NET INTEREST INCOME (Notes 10 and 15)................    1,608,419        778,002        84,736
                                                       -----------    -----------    ----------
INCOME (LOSS) BEFORE PROVISION FOR INCOME
  TAXES..............................................      631,110      2,874,796      (396,389)
PROVISION FOR INCOME TAXES (Note 13).................      225,000        365,000            --
                                                       -----------    -----------    ----------
NET INCOME (LOSS)....................................  $   406,110    $ 2,509,796    $ (396,389)
                                                       ===========    ===========    ==========
Net income (loss) per common share (Note 14):
     Basic...........................................  $      0.07    $      0.49    $    (0.13)
                                                       ===========    ===========    ==========
     Diluted.........................................  $      0.07    $      0.46    $    (0.13)
                                                       ===========    ===========    ==========
Weighted average number of common and common
  equivalent shares outstanding:
     Basic...........................................    5,954,472      5,145,032     3,037,484
                                                       ===========    ===========    ==========
     Diluted.........................................    6,122,111      5,416,569     3,037,484
                                                       ===========    ===========    ==========
</TABLE>

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

                                       35
<PAGE>   38

                                   SEEC, INC.

      CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (DEFICIT)

                   YEARS ENDED MARCH 31, 1997, 1998 AND 1999

<TABLE>
<CAPTION>
                               COMMON STOCK                       RETAINED                    ACCUMULATED        TOTAL
                            -------------------   ADDITIONAL      EARNINGS                       OTHER       SHAREHOLDERS'
                            NUMBER OF               PAID-IN     (ACCUMULATED    TREASURY     COMPREHENSIVE       EQUITY
                             SHARES     AMOUNT      CAPITAL       DEFICIT)        STOCK      INCOME (LOSS)     (DEFICIT)
                            ---------   -------   -----------   ------------    --------     -------------   -------------
<S>                         <C>         <C>       <C>           <C>            <C>           <C>             <C>
Balance -- April 1,
  1996....................  2,357,923   $23,580   $    30,812   $(1,731,360)   $        --     $     --       $(1,676,968)
Comprehensive income
  (loss):
  Net loss for year.......        --        --             --      (396,389)            --           --                --
  Unrealized losses on
    investments...........        --        --             --            --             --      (67,600)               --
  Total comprehensive
    income (loss).........        --        --             --            --             --           --          (463,989)
Issuance of common stock
  for:
  Conversion of notes and
    other long-term
    liabilities payable to
    related parties (Note
    15)...................   237,025     2,370        783,165            --             --           --           785,535
  Cash (Note 15)..........   211,425     2,114        745,326            --             --           --           747,440
Initial public offering,
  less issuance costs
  (Note 2)................  2,070,000   20,700     12,929,054            --             --           --        12,949,754
Exercise of warrants (Note
  11).....................   124,460     1,244          1,244            --             --           --             2,488
                            ---------   -------   -----------   -----------    -----------     --------       -----------
Balance -- March 31,
  1997....................  5,000,833   50,008     14,489,601    (2,127,749)            --      (67,600)       12,344,260
Comprehensive income:
  Net income for year.....        --        --             --     2,509,796             --           --                --
  Unrealized gains on
    investments, net of
    taxes.................        --        --             --            --             --       81,916                --
  Total comprehensive
    income................        --        --             --            --             --           --         2,591,712
Public offering, less
  issuance costs (Note
  2)......................  1,030,000   10,300     19,058,345            --             --           --        19,068,645
Exercise of stock options
  (Note 9)................     2,715        27         18,032            --             --           --            18,059
Exercise of warrants (Note
  11).....................    42,998       430            430            --             --           --               860
                            ---------   -------   -----------   -----------    -----------     --------       -----------
Balance -- March 31,
  1998....................  6,076,546   60,765     33,566,408       382,047             --       14,316        34,023,536
Comprehensive income:
  Net income for year.....        --        --             --       406,110             --           --                --
  Unrealized gains on
    investments, net of
    taxes.................        --        --             --            --             --        6,013                --
  Total comprehensive
    income................        --        --             --            --             --           --           412,123
Exercise of stock options
  (Note 9)................     7,601        77         10,388            --             --           --            10,465
Purchase of common stock
  (Note 2)................        --        --             --            --     (1,302,496)          --        (1,302,496)
Issuance of shares under
  employee stock purchase
  plan (Notes 2 and 9)....        --        --             --       (21,588)       120,000           --            98,412
                            ---------   -------   -----------   -----------    -----------     --------       -----------
Balance -- March 31,
  1999....................  6,084,147   $60,842   $33,576,796   $   766,569    $(1,182,496)    $ 20,329       $33,242,040
                            =========   =======   ===========   ===========    ===========     ========       ===========
</TABLE>

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

                                       36
<PAGE>   39

                                   SEEC, INC.

                     CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
                                                                     YEARS ENDED MARCH 31,
                                                           -----------------------------------------
                                                              1999           1998           1997
                                                           -----------    -----------    -----------
<S>                                                        <C>            <C>            <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)........................................  $   406,110    $ 2,509,796    $  (396,389)
Adjustments to reconcile net income (loss) to net cash
  used by operating activities:
  Depreciation and amortization..........................      384,020        103,960         36,050
  Provision for doubtful accounts........................      175,363         71,975          9,392
  Loss on disposals of equipment.........................          925         32,023             --
  Accrued noncurrent interest............................           --             --         13,420
  Accrued noncurrent royalty.............................           --        (30,331)         1,291
  Deferred income taxes..................................       20,200        365,000             --
Changes in operating assets and liabilities:
  Accounts receivable -- trade...........................    2,832,694     (4,909,107)      (637,076)
  Accounts receivable -- affiliate.......................      189,097       (104,955)       (83,150)
  Prepaid expenses.......................................       13,071       (367,770)      (138,476)
  Accounts payable -- trade..............................     (427,268)       746,475        246,362
  Accounts payable -- affiliate..........................     (230,085)       206,435         23,650
  Accrued payroll, related taxes and withholdings........     (424,329)       777,182        (23,770)
  Accrued royalties......................................     (205,181)       133,697         90,509
  Other accrued expenses.................................     (118,113)       439,662         76,044
  Deferred maintenance revenue...........................     (220,892)       744,961         68,275
  Income taxes payable...................................      195,800             --             --
  Advance royalty........................................           --       (780,552)       (15,927)
  Other, net.............................................      (27,101)        13,789        (26,034)
                                                           -----------    -----------    -----------
       Net cash provided (used) by operating
         activities......................................    2,564,311        (47,760)      (755,829)
                                                           -----------    -----------    -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
  Purchase of property and equipment.....................     (239,222)      (868,003)      (127,922)
  Expenditures for trademarks............................      (46,421)            --             --
  Purchases of short-term investments....................   (2,742,296)    (2,173,163)    (9,055,371)
  Sales of short-term investments........................    1,350,000      4,220,000             --
  Payment of obligation in connection with acquisition of
    affiliate............................................   (1,036,000)            --             --
  Other..................................................       (4,542)         5,926             --
                                                           -----------    -----------    -----------
       Net cash provided (used) by investing
         activities......................................   (2,718,481)     1,184,760     (9,183,293)
                                                           -----------    -----------    -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
  Repayment of long-term debt............................           --       (240,000)       (60,000)
  Purchases of treasury stock............................   (1,302,496)            --             --
  Proceeds from issuances of common stock, net...........      108,877     19,087,564     13,699,682
                                                           -----------    -----------    -----------
       Net cash provided (used) by financing
         activities......................................   (1,193,619)    18,847,564     13,639,682
                                                           -----------    -----------    -----------
Net increase (decrease) in cash and cash equivalents.....   (1,347,789)    19,984,564      3,700,560
Cash and cash equivalents, beginning of period...........   23,795,965      3,811,401        110,841
                                                           -----------    -----------    -----------
Cash and cash equivalents, end of period.................  $22,448,176    $23,795,965    $ 3,811,401
                                                           ===========    ===========    ===========
Supplemental cash flow information:
Cash paid during the period for interest.................  $        --    $    27,464    $    40,500
                                                           ===========    ===========    ===========
Conversion of debt to common stock (Note 15).............  $        --    $        --    $   785,535
                                                           ===========    ===========    ===========
Unrealized gains (losses) on investments, net of taxes...  $     6,013    $    81,916    $   (67,600)
                                                           ===========    ===========    ===========
Non-cash investing and financing activities:
  Business acquisition:
  Fair value of assets acquired..........................  $        --    $   404,602    $        --
  Goodwill, net..........................................           --        717,398             --
  Current liabilities assumed............................           --        (81,000)            --
  Write-off of investment in affiliate...................           --         (5,000)            --
                                                           -----------    -----------    -----------
  Obligation incurred to seller..........................  $        --    $ 1,036,000    $        --
                                                           ===========    ===========    ===========
</TABLE>

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

                                       37
<PAGE>   40

                                   SEEC, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 -- BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES

     Basis of Presentation.  The consolidated financial statements include the
accounts of SEEC, Inc. and its wholly-owned subsidiaries (collectively, the
"Company"), including SEEC Holdings, Inc., organized in February 1998, SEEC
Europe Limited, organized in April 1997, SEEC Technologies Asia Private Limited
("SEEC Asia"), organized in March 1998 (see Note 3), and SEEC Germany GmbH,
organized in July 1998. Also included are the accounts of the unincorporated
branch operations located in South Korea. All significant intercompany balances
and transactions have been eliminated.

     Business.  The Company provides a suite of software products and related
services to assist primarily Fortune 1000 companies and similarly-sized business
and governmental organizations in the reengineering of legacy COBOL software
applications and related databases for large mainframe systems. The Company also
provides solutions for the system reengineering required to transform and
integrate mainframe systems with e-commerce and new software systems, for year
2000 compliance, and to support the migration of existing COBOL applications
from a mainframe to a client/server environment.

     The Company's PC-Windows-based products for COBOL application reengineering
are designed to be alternatives to mainframe-based tools. Marketing efforts are
conducted through the Company's direct sales force and relationships with third
party service providers under non-exclusive marketing licenses. The Company
sells and supports its products and services primarily from its Pittsburgh,
Pennsylvania headquarters. The Company also conducts sales and limited support
activities through its foreign operations. SEEC Asia also engages in research
and development.

     Until February 27, 1998, the Company had a strategic software research and
development alliance with ERA Software Systems Private, Limited (ERA), a
software consulting and development company based in India. The Company and ERA
were affiliated through common ownership until the Company acquired certain of
ERA's assets and operations in a transaction effective February 28, 1998 (see
Notes 3, 7 and 8).

     Foreign Currency Translation.  The Company's foreign operations' functional
currency is the U.S. dollar. Monetary assets and liabilities of the Company's
foreign subsidiaries are translated at year-end exchange rates and non-monetary
items are translated at historical rates. Revenues and expenses are translated
at average exchange rates in effect during the period. Foreign currency
transaction gains and losses, which are not material, are recognized currently
in the consolidated statements of operations.

     Recapitalization.  On January 15, 1997, the Board of Directors effected a
1-for-2.2094 reverse stock split in connection with the January 22, 1997 initial
public offering of the Company's common stock. All shares, options, warrants and
per share amounts in the accompanying financial statements have been adjusted to
reflect the effects of this recapitalization.

     Use of Estimates.  The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that 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 period. Actual results could differ from those estimates.

     Cash, Cash Equivalents and Concentrations of Credit Risk.  The statements
of cash flows classify changes in cash and cash equivalents (short-term,
highly-liquid investments readily convertible into cash with an original
maturity of three months or less) according to operating, investing or financing
activities. Cash equivalents consist of funds in money market accounts and were
$22,326,497, $23,708,170 and $3,798,799 at March 31, 1999, 1998 and 1997,
respectively. Financial instruments that potentially expose the Company to
concentrations of credit risk consist principally of cash, temporary cash
investments and accounts receivable.

                                       38
<PAGE>   41

     The Company places its cash and temporary cash investments with financial
institutions which management considers to be of high quality; however, at times
such deposits may be in excess of the Federal Deposit Insurance Corporation
insurance limit.

     Concentrations of credit risk with respect to accounts receivable result
from a significant portion of revenues being derived from a relatively small
number of entities (see Notes 5 and 8); however, the Company's customer base has
been growing and is dispersed across many different industries and geographic
areas. The Company generally extends credit to its customers without requiring
collateral; however, it closely monitors extensions of credit and has not
experienced significant credit losses.

     Short-Term Investments.  Short-term investments consist of short duration
fixed-income securities, primarily U.S. government agency issues and corporate
bonds. The average duration of the short-term investment portfolio of debt
securities is approximately two years. The Company's short-term investments are
classified as available-for-sale and are carried at fair value with the net
unrealized gain or loss reported as a separate component of shareholders'
equity. Realized gains and losses are recognized in the results of operations.

     Revenue Recognition.  Revenues are derived from the license of software
products, customer support and maintenance contracts, and services contracts,
including consulting and training services. Revenue from product license fees is
recognized upon shipment and resolution of any material vendor obligations.
Customer support and maintenance contract revenue is recognized ratably over the
term of the related agreement. The Company provides programming and
reengineering services under time and materials and fixed-price contracts.
Revenues from time and materials contracts are recognized as the services are
provided. Revenues from fixed-price contracts are recognized on achievement of
specified performance milestones negotiated with customers. This method, which
recognizes revenues on substantially the same basis as the
percentage-of-completion method, is used because management considers milestones
to be the best available measure of progress. Provision for estimated losses on
uncompleted contracts is made in the period in which such losses are
determinable (see Note 8).

     On April 1, 1998, the Company adopted AICPA Statement of Position 97-2,
"Software Revenue Recognition," ("SOP 97-2") which specifies the criteria that
must be met for recognizing revenues from software sales. The adoption of SOP
97-2 has not had a material impact on the Company's financial position or
results of operations.

     Property and Equipment.  Property and equipment are stated at cost.
Maintenance and repairs that are not considered to extend the useful life of
assets are charged to operations as incurred.

     The straight-line method of depreciation was adopted for all property and
equipment placed in service after December 31, 1997. For property and equipment
acquired previously, depreciation and amortization is calculated using the
declining-balance method. The Company believes the new method more appropriately
reflects its financial results by better allocating costs of new assets over
their estimated useful lives. The effect of this change on net income for the
year ended March 31, 1998 was not material. Estimated useful lives of assets are
as follows: computer equipment--3 to 5 years; software and other equipment--5
years; furniture and fixtures--5 to 7 years; and leasehold improvements--life of
the lease.

     Investment in Affiliate.  Investment in affiliate represents the Company's
investment in ERA prior to the acquisition discussed in Note 3. The investment,
which represented an ownership interest of less than 10%, was accounted for at
cost. The common ownership interests of the Company and ERA were not considered
sufficient to enable either of them to exert significant influence necessary to
require the Company's investment in ERA to be accounted for under the equity
method of accounting. Further, in management's opinion, the use of the equity
method of accounting would not have had a significant effect on the Company's
financial position or results of operations.

     Goodwill and Other Intangible Assets.  Goodwill represents the excess of
the consideration paid for the purchase of certain of ERA's assets and
operations over the fair value of the net assets acquired, and is being
amortized over a five-year period. The carrying value of goodwill is assessed on
an ongoing basis, based on an

                                       39
<PAGE>   42

evaluation of future cash flows. Impairment losses are recognized if expected
future cash flows of the related assets are less than their carrying values.
Other intangibles, which include trademarks, are amortized on a straight-line
basis over the estimated useful lives of the assets.

     Research and Development Costs.  Statement of Financial Accounting
Standards No. 86, "Accounting for the Costs of Computer Software to be Sold,
Leased or Otherwise Marketed" (SFAS 86), establishes criteria for capitalization
of software development costs, beginning upon the establishment of product
technological feasibility and concluding when the product is available for
general release to customers.

     Management believes that in applying the above criteria, capitalizable
costs must be carefully evaluated in conjunction with certain factors including,
among other things, costs reimbursed by the ICICI grant (see Notes 7 and 8),
anticipated future revenues, estimated economic product life, amortization
methodologies, and frequency of changes in software and hardware technologies.
After carefully evaluating these factors, management concluded that the amounts
which should have been capitalized pursuant to SFAS 86, specifically costs
incurred after technological feasibility is established and prior to general
release of the software to customers, were immaterial and therefore no software
development costs have been capitalized to date.

     Advertising Costs.  Advertising costs are expensed as incurred and totaled
$531,473, $316,767 and $97,668 for the years ended March 31, 1999, 1998 and
1997, respectively.

     Stock-Based Compensation.  The Company accounts for its stock-based
employee compensation plans in accordance with Statement of Financial Accounting
Standards No. 123, "Accounting for Stock-Based Compensation." The Company
adopted this statement during the year ended March 31, 1997; however, it has
elected to continue to account for stock options at their intrinsic value with
disclosures of the effects of fair value accounting on net income (loss) and net
income (loss) per share on a pro forma basis (see Note 9).

     Income Taxes.  The Company records income taxes pursuant to Statement of
Financial Accounting Standards No. 109, "Accounting for Income Taxes" (SFAS No.
109). Under the asset and liability method of SFAS No. 109, deferred income
taxes are recognized for the future tax consequences attributable to differences
between the financial statement carrying amounts of existing assets and
liabilities and their respective tax bases. Deferred tax assets and liabilities
are measured using enacted tax rates expected to apply to taxable income in the
years in which those temporary differences are expected to be recovered or
settled. Under SFAS No. 109, the effect on deferred taxes of a change in tax
rates is recognized in income in the period that includes the enactment date
(see Note 13).

     Net Income (Loss) per Common Share.  Earnings per share (EPS) for all
periods presented is computed in accordance with the provisions of Statement of
Financial Accounting Standards No. 128, "Earnings Per Share" (SFAS No. 128). The
provisions and disclosure requirements for SFAS No. 128 were required to be
adopted for interim and annual periods ending after December 15, 1997, with
restatement of EPS for prior periods (see Note 14).

     Financial Instruments.  The estimated fair value of the Company's financial
instruments, which include short-term investments, accounts receivable, accounts
payable and off-balance-sheet letters of credit, approximates their carrying
value.

     Comprehensive Income.  Effective April 1, 1998, the Company adopted
Statement of Financial Accounting Standards No. 130, Reporting Comprehensive
Income (SFAS 130). Comprehensive income is defined to include all changes in
equity except those resulting from investments by owners and distributions to
owners. SFAS 130 requires that all items recognized as components of
comprehensive earnings be reported in an annual financial statement that is
displayed with the same prominence as other annual financial statements. The
Company's comprehensive income has been included in the consolidated statement
of stockholders' equity for all periods.

     Segment Reporting.  Effective April 1, 1998, the Company adopted Statement
of Financial Accounting Standard No. 131, Disclosures about Segments of an
Enterprise and Related Information. This statement establishes standards for the
way that public companies report information about operating segments and

                                       40
<PAGE>   43

geographical information in annual and interim financial statements. The Company
operates in one industry segment. See Note 5 for geographic information.

     Disclosures about Pensions and Other Postretirement Benefits.  Statement of
Financial Accounting Standards No. 132, "Employers' Disclosures about Pensions
and Other Postretirement Benefits--an amendment of FASB Statements No. 87, 88,
and 106," revises employers' disclosures about pension and other postretirement
benefit plans. It does not change the measurement or recognition of those plans.
The Company currently has no pension benefit plans for its employees, and as
such is not subject to the disclosure requirements of this Statement.

     Reclassifications.  Certain prior period amounts have been reclassified to
conform to the current year presentation. The prior year distribution of assets
and liabilities acquired, estimated in connection with the acquisition discussed
in Note 3, has been adjusted to reflect final actual amounts.

NOTE 2 -- CAPITAL STOCK AND PUBLIC OFFERINGS

     In January 1997 the Company sold, through an underwritten initial public
offering, 1,800,000 common shares. In February 1997 an additional 270,000 shares
were sold pursuant to an underwriters over-allotment provision. The net proceeds
of these sales were approximately $12,950,000. In February 1998 the Company
completed a secondary public offering of 1,030,000 new shares of its common
stock for approximately $19,068,000, net of issuance costs.

     A portion of the proceeds of the initial public offering has been used for
expanded sales and marketing, new personnel, additional capital expenditures,
working capital and other general corporate purposes. The remaining proceeds of
these offerings are intended to be used further in these areas and to expand
international operations, increase research and development, and possibly
acquire businesses, products or technologies complementary to the Company's
current business.

     In connection with the initial public offering, the Company issued to
underwriters warrants to purchase additional shares of common stock (see Note
11).

     In July 1998, the Company announced its plan to begin a stock repurchase
program, utilizing up to $3,000,000 to buy shares of the Company's Common Stock
from time to time on the open market, subject to market conditions and other
relevant factors. The Company may use repurchased shares to cover stock option
exercises, employee stock purchase plan transactions, and for other corporate
purposes. During the year ended March 31, 1999, the Company repurchased 278,900
shares and used 22,940 shares to cover employee stock purchase plan
transactions. Repurchased shares are recorded as treasury shares.

NOTE 3 -- ACQUISITION

     On February 27, 1998, the Company entered into an agreement with ERA,
whereby ERA transferred its distribution rights for Company products, plus
certain fixed assets and 30 former ERA employees engaged exclusively in
Company-related research and development, sales and administration, for a net
consideration of $1,041,000. With the acquisition, the Company assumed control
of ERA's research and development and distribution functions. All
Company-related research and development work performed by ERA through the date
of the acquisition had been previously expensed by the Company as incurred. SEEC
Asia was formed to effect the acquisition and to subsequently control and manage
the acquired rights, assets and product development projects previously owned or
managed by ERA, as well as to expand the Company's sales and marketing efforts
in the Asian and Pacific Rim regions.

     The acquisition was accounted for as a purchase and accordingly, the
results of operations of the acquired business are included in the Company's
consolidated financial statements since the effective date. The acquisition was
effective at the close of business on February 28, 1998, with final closing and
remittance of the net consideration completed in August 1998. The aggregate
purchase price was allocated to the net assets acquired based upon their
respective fair market values. The excess of the purchase price over the fair
values of the net assets acquired of $717,398 was allocated to goodwill and is
being amortized on a straight-line basis over five

                                       41
<PAGE>   44

years. Under terms of the agreement, the Product Purchase Agreement and the
Marketing Agreement between the Company and ERA (as discussed at Note 7) were
terminated.

     Based upon the fair market values on the effective date of the acquisition,
the purchase price was allocated as follows:

<TABLE>
<S>                                                           <C>
Property and equipment......................................  $  260,000
Goodwill....................................................     717,398
Other intangibles -- option to purchase land................     144,602
Current liabilities.........................................     (81,000)
                                                              ----------
Total purchase price........................................   1,041,000
Write-off of investment in affiliate........................      (5,000)
                                                              ----------
Net consideration...........................................  $1,036,000
                                                              ==========
</TABLE>

     The acquisition had no significant impact on operating results for the year
ended March 31, 1998, as the acquisition was not effective until the last month
of the fiscal year. The effect on operating results, assuming the acquisition
had taken place as of the beginning of each of the years ended March 31, 1997
and 1998, would not have been material.

NOTE 4 -- SHORT-TERM INVESTMENTS

     Short-term investments consist of the following:

<TABLE>
<CAPTION>
                                                                         UNREALIZED      MARKET
                                                               COST         GAIN         VALUE
                                                            ----------   -----------   ----------
<S>                                                         <C>          <C>           <C>
March 31, 1999:
  U.S. Government agency securities.......................  $2,530,659     $ 3,838     $2,534,497
  Registered investment company consisting of U.S.
     Government and corporate fixed income securities.....   5,887,897      30,291      5,918,188
                                                            ----------     -------     ----------
                                                            $8,418,556     $34,129     $8,452,685
                                                            ==========     =======     ==========
March 31, 1998:
  U.S. Government agency securities.......................  $1,016,136     $   744     $1,016,880
  Corporate bonds.........................................     352,240         732        352,972
  Registered investment company consisting of U.S.
     Government and corporate fixed income securities.....   5,640,158      22,540      5,662,698
                                                            ----------     -------     ----------
                                                            $7,008,534     $24,016     $7,032,550
                                                            ==========     =======     ==========
</TABLE>

     Management does not anticipate realization of the holding gain in the
upcoming year due to the anticipated adequacy of cash and cash equivalents
currently held to fund current operating requirements.

NOTE 5 -- GEOGRAPHIC INFORMATION AND MAJOR CUSTOMERS

     Sales to Unisys Corporation accounted for 12% of the Company's total
revenues during the year ended March 31, 1999, and accounts receivable from
Unisys Corporation totaled $178,766 at March 31, 1999. Sales to INTERSOLV, Inc.
accounted for 11% of the Company's total revenues during the year ended March
31, 1998, and accounts receivable from INTERSOLV, Inc. totaled $797,563 at March
31, 1998. During the year ended March 31, 1997, sales to Complete Business
Solutions, Inc. (CBSI) represented approximately 19% of revenues.

     For the year ended March 31, 1999, export sales to non-affiliates accounted
for 27% of total revenues, including Canada--5%, South America--8%, Europe--9%
and Asia--4%. For the year ended March 31, 1998, export sales to third parties
accounted for 19% of total revenues, with sales to Europe and Asia representing
8% and 7% of total revenues, respectively. Such export sales were not
significant for the year ended March 31, 1997.

                                       42
<PAGE>   45

NOTE 6 -- PROPERTY AND EQUIPMENT

     Property and equipment consists of the following:

<TABLE>
<CAPTION>
                                                                    MARCH 31,
                                                             ------------------------
                                                                1999          1998
                                                             ----------    ----------
<S>                                                          <C>           <C>
Computer equipment.........................................  $  597,508    $  474,894
Software and other equipment...............................     250,062       181,993
Furniture and fixtures.....................................     422,623       406,136
Leasehold improvements.....................................     206,488       190,299
                                                             ----------    ----------
Total property and equipment...............................   1,476,681     1,253,322
Accumulated depreciation and amortization..................    (374,161)     (137,663)
                                                             ----------    ----------
Property and equipment, net................................  $1,102,520    $1,115,659
                                                             ==========    ==========
</TABLE>

NOTE 7 -- TRANSACTIONS WITH AFFILIATE

     Prior to the ERA acquisition, (see Note 3), the Company and ERA developed
certain COBOL analysis software products (the Products) through their
cooperative research and development efforts, which were funded in part through
grants from the Industrial Credit and Investment Corporation of India, Ltd.
(ICICI), an investment bank that administers an agreement between the
governments of the United States of America and the Republic of India. The
ongoing process of development of the Products commenced in 1990 and had been
undertaken pursuant to the terms of various agreements among the Company, ERA
and ICICI, which have been amended from time to time to reflect their evolving
relationships.

     Pursuant to a product purchase agreement (the Product Purchase Agreement)
dated March 31, 1996, in which the Company acquired ERA's 35% interest in the
Products, the Company agreed to pay the following to:

          - ERA -- a research and development fee (royalty) equal to 10% of
            gross Product revenues (in no event were quarterly payments to be
            less than $12,000) through December 31, 1996;

          - ICICI on behalf of ERA -- 5% of gross Product revenues until such
            aggregate payments (see Note 8) satisfy ERA's obligation to ICICI
            (the ERA Obligation) after which such payments shall cease; and,

          - ERA -- a monthly maintenance fee of $5,000 for the first three
            years, $6,000 for the next three years, and thereafter in amounts to
            be mutually determined.

     Effective January 1, 1997, the Company and ERA agreed to amend the Product
Purchase Agreement to eliminate the research and development fee (royalty) and
the monthly maintenance fee described above and replace them with specific fees
determined on a project-by-project basis for research and development performed
by ERA. ERA performed research and development for the Company under this
arrangement through the date of the acquisition, when the Company acquired ERA's
research and development facility.

     Effective March 1, 1996, the Company formalized its marketing arrangements
with ERA by entering into a marketing agreement to distribute the Company's
products on a non-exclusive basis in India. The agreement provided for royalties
to be paid by ERA to the Company based on 40% of revenues (using the suggested
international list prices established by the Company) from customers in India
through September 1, 1996, and 50% thereafter. Royalties received under the
terms of the marketing agreement amounted to $299,930 and $205,799 for the years
ended March 31, 1998 and 1997, respectively. The marketing agreement was
terminated coincident with the ERA acquisition, effective February 27, 1998.

                                       43
<PAGE>   46

     The Company incurred the following expenses in connection with its
activities with ERA:

<TABLE>
<CAPTION>
                                                              YEARS ENDED MARCH 31,
                                                              ----------------------
                                                                1998         1997
                                                              ---------    ---------
<S>                                                           <C>          <C>
Royalty expense.............................................  $     --     $ 36,310
                                                              ========     ========
Research and development fees...............................  $229,977     $129,218
                                                              ========     ========
Fees applicable to professional services provided by ERA
  employees.................................................  $ 13,000     $ 77,078
                                                              ========     ========
</TABLE>

     During the year ended March 31, 1998, the Company paid to ERA sales support
and maintenance support fees related to certain U.S. sales where ERA was
instrumental in effecting the sale and for which ERA was expected to provide
ongoing maintenance support to the customer. For the year ended March 31, 1998,
these fees totaled $142,833, net of $40,417 in unamortized maintenance support
expense which was eliminated in connection with the ERA acquisition.

NOTE 8 -- ROYALTY AGREEMENTS

     Viasoft, Inc. -- Effective December 1, 1993, the Company entered into a
five-year license agreement (the License Agreement) with Viasoft, Inc. (the
Licensee) which generally granted to the Licensee a worldwide license to use and
market certain of the Company's products on a private-label basis. The License
Agreement provided, among other things, for royalties of up to 30% of any
license or maintenance fees related to licensed products and minimum advance
royalty payments totaling $900,000 during the eighteen-month exclusivity period,
which expired on May 31, 1995.

     Pursuant to the terms of the agreement, the Company gave notice to Viasoft
on December 3, 1996 of its intention to terminate the License Agreement as a
result of Viasoft's not making additional minimum royalty payments of at least
$1,000,000 during the preceding twelve months, as required by the License
Agreement. The Company received notice from Viasoft that it did not intend to
extend the License Agreement by making such minimum payments and acknowledging
that the License Agreement would terminate effective June 4, 1997.

     The License Agreement had provided that, upon termination, the Company
would be obligated to deliver to Viasoft that number of copies of the licensed
products equal to the balance of the advance royalty divided by the applicable
licensed product royalty amounts. At such time as these copies were delivered to
Viasoft, the Company would recognize as income the balance of the advance
royalty. On June 30, 1997, the Company received formal notice from Viasoft that
no further copies of the licensed products were to be delivered to Viasoft, and
that the Company was relieved of such obligation under the terms of the License
Agreement. Accordingly, the $780,552 balance of the advance royalty that had
been deferred was recognized as software license revenue in the year ended March
31, 1998.

     The Company had not received any royalty payments beyond the minimum
advance royalty of $900,000, which was being recognized as income as copies of
the licensed products were delivered to Viasoft for resale, and, to a lesser
extent, as royalties on the related maintenance revenues were reported to the
Company by Viasoft. Software license fees as presented in the accompanying
statements of operations includes Viasoft royalty income of $780,552 and $15,927
for the years ended March 31, 1998 and 1997, respectively. Total revenues from
Viasoft, including income from the advance royalty, represented 6% and 2% of the
Company's total revenues for the years ended March 31, 1998 and 1997,
respectively.

     The License Agreement also requires the Company to pay a royalty of 5% of
sales of its products which contain or use a COBOL parser, up to $1,000,000 over
a five-year period ending April 29, 1999. Since inception, the Company has
expensed a total of $317,775 in related royalties expense, including $99,757 in
the year ended March 31, 1999.

     ICICI -- Pursuant to the terms of the June 1, 1990 ICICI agreement (the
ICICI Agreement -- see Note 7), as amended, the Company received a $255,000
grant to partially fund research and development costs to develop the Products
in association with ERA. ERA received a grant of approximately $101,000 under
the ICICI Agreement for similar purposes.
                                       44
<PAGE>   47

     The ICICI Agreement required the Company and ERA to make royalty payments
based on Product revenues up to a maximum of approximately $735,000. The Company
and ERA were jointly and severally obligated for payment of the royalties.
However, subsequent to March 31, 1993, ICICI agreed to accept from the Company
total royalties of 10% of Product revenues and 5% of revenues from Product
maintenance and Product-related services in satisfaction of future royalties due
from the Company and ERA. Total royalty expense under the ICICI Agreement was
$497,965 and $122,585 for the years ended March 31, 1998 and 1997, respectively.

     Both the maximum royalty obligation of the Company pursuant to the ICICI
Agreement and the amount of the ERA Obligation (see Note 7) were paid in full
during the year ended March 31, 1998.

NOTE 9 -- STOCK OPTION PLANS

     The Company has two stock option plans (the "Plans") that provide for the
granting of stock options to officers and key employees. The 1994 Stock Option
Plan provides for a maximum of 226,305 common shares that may be awarded during
the Plan's ten-year term. The 1997 Stock Option Plan provides for a maximum of
650,000 common shares that may be awarded through June 2007. The purpose of the
Plans is to promote the interests of the Company and its shareholders by
providing key employees with additional incentives to continue the success of
the Company.

     Under the Plans, options are awarded by a committee designated by the
Company's Board of Directors or, if no committee is designated, the full Board.
Incentive stock options and non-qualifying stock options may be granted to
purchase a specified number of shares of common stock at a price not less than
the fair market value on the date of grant and for a term not to exceed 10
years. Options become exercisable at such times and in such installments as
determined at the date of grant, subject to continued employment and certain
other conditions, including a limited ability to sell or otherwise transfer
shares issued pursuant to the Plans.

     Stock option activity under the Plans was as follows:

<TABLE>
<CAPTION>
                                                            YEAR ENDED MARCH 31,
                                      ----------------------------------------------------------------
                                              1999                  1998                  1997
                                      --------------------   -------------------   -------------------
                                                 WEIGHTED              WEIGHTED              WEIGHTED
                                                  AVERAGE               AVERAGE               AVERAGE
                                                 EXERCISE              EXERCISE              EXERCISE
                                                   PRICE                 PRICE                 PRICE
           FIXED OPTIONS               SHARES    PER SHARE   SHARES    PER SHARE   SHARES    PER SHARE
           -------------              --------   ---------   -------   ---------   -------   ---------
<S>                                   <C>        <C>         <C>       <C>         <C>       <C>
Outstanding at beginning of year....   343,814    $10.29     146,455    $ 3.08      49,556     $ .45
Granted.............................   311,950    $ 5.24     230,375    $14.57      98,709     $4.40
Exercised...........................    (7,601)   $ 1.38        (452)   $ 3.65          --     $  --
Canceled............................  (173,052)   $14.57     (32,564)   $ 8.28      (1,810)    $3.31
                                      --------               -------               -------
Outstanding at end of year..........   475,111    $ 5.55     343,814    $10.29     146,455     $3.08
                                      ========               =======               =======
Options exercisable at end of
  year..............................   118,291                79,579                34,593
                                      ========               =======               =======
Weighted average fair value of
  options granted during the year...  $   2.68               $  6.62               $   .87
                                      ========               =======               =======
</TABLE>

SUMMARY STOCK OPTION INFORMATION:

     The Company accounts for the Plans using the intrinsic value method.
Accordingly, no compensation cost has been recognized for the Plans. The pro
forma data below reflects the effect had compensation cost for the

                                       45
<PAGE>   48

Plans been determined based on the fair market value at the grant dates for the
awards under the Plans in accordance with SFAS No. 123.

<TABLE>
<CAPTION>
                                                                        YEAR ENDED MARCH 31,
                                                                 -----------------------------------
                                                                   1999         1998         1997
                                                                 --------    ----------    ---------
<S>                                    <C>                       <C>         <C>           <C>
Net income (loss)                      As reported.............  $406,110    $2,509,796    $(396,389)
                                       Pro forma...............  $117,789    $2,365,106    $(404,389)
Net income (loss) per basic share      As reported.............  $    .07    $      .49    $    (.13)
                                       Pro forma...............  $    .02    $      .46    $    (.13)
Net income (loss) per diluted share    As reported.............  $    .07    $      .46    $    (.13)
                                       Pro forma...............  $    .02    $      .44    $    (.13)
</TABLE>

     The fair value of each option grant is estimated on the date of grant using
the Black-Sholes option pricing model with the following assumptions used for
grants for the years ended March 31, 1999, 1998 and 1997, respectively: risk
free interest rate -- 5.6%, 6%, and 7%; expected weighted-average term -- 4.2
years, 2.9 years, and 2.1 years. A dividend yield of zero was assumed for all
three years. Expected volatility of 75% was assumed in the estimation of fair
value for the year ended March 31, 1999. Volatility of 60% was assumed for the
years ended March 31, 1997 and 1998.

     The following table summarizes information about stock options outstanding
at March 31, 1999:

<TABLE>
<CAPTION>
                          OPTIONS OUTSTANDING             OPTIONS EXERCISABLE
                  ------------------------------------   ---------------------
                                WEIGHTED     WEIGHTED                WEIGHTED
                                AVERAGE       AVERAGE                 AVERAGE
    RANGE OF                   REMAINING     EXERCISE                EXERCISE
    EXERCISE       NUMBER     CONTRACTUAL      PRICE      NUMBER       PRICE
     PRICES       OF SHARES   LIFE (YEARS)   PER SHARE   OF SHARES   PER SHARE
----------------  ---------   ------------   ---------   ---------   ---------
<S>               <C>         <C>            <C>         <C>         <C>
$.44--$.49          42,598        5.28        $  .45       41,638     $  .45
$3.31--$4.00       198,638        9.01        $ 3.85       52,362     $ 3.83
$6.00--$8.50       198,875        9.25        $ 6.53       15,541     $ 8.28
$16.25              35,000        8.92        $16.25        8,750     $16.25
                   -------                                -------
                   475,111        8.77        $ 5.54      118,291     $ 4.14
                   =======                                =======
</TABLE>

     During the year ended March 31, 1999, the Company issued non-qualified
options to purchase a total of 60,000 shares of common stock at an exercise
price of $6.00. Non-qualified options to purchase 15,000 shares of common stock
at an exercise price of $20.75 were forfeited during the year.

     During the year ended March 31, 1998, the Company issued non-qualified
options to purchase a total of 45,000 shares of common stock at an exercise
price of $20.75. The Company also issued non-qualified options to purchase 9,000
shares of common stock at an exercise price of $8.25 in conjunction with an
employment severance agreement, and in exchange for the forfeiture of
previously-issued incentive stock options to purchase 20,000 shares of common
stock at the same exercise price of $8.25.

     During the year ended March 31, 1997, the Company issued non-qualified
options to purchase a total of 11,315 shares of common stock at exercise prices
of $3.62 and $7.25.

     Non-qualified options to purchase 2,263 shares of common stock were
exercised at an exercise price of $7.25 during the year ended March 31, 1998.

                                       46
<PAGE>   49

     At March 31, 1999, non-qualified options to purchase a total of 108,052
shares of common stock were outstanding, exercisable as follows:

<TABLE>
<CAPTION>
    EXERCISE   NUMBER OF
     PRICE      SHARES                           EXERCISABLE
    --------   ---------                         -----------
<S> <C>        <C>         <C>
     $ 3.62      9,052     4,526 each at August 30, 1997 and 1998
     $ 6.00     60,000     15,000 each at August 12, 1999, 2000, 2001 and 2002
     $ 8.25      9,000     3,000 each at April 1, June 1, and August 1, 1998
     $20.75     30,000     10,000 each at August 8, 1998, 1999 and 2000
</TABLE>

EMPLOYEE STOCK PURCHASE PLAN:

     On August 6, 1998, the Company adopted the SEEC, Inc. 1998 Employee Stock
Purchase Plan (the "ESPP"), under which employees may purchase shares of the
Company's common stock at 85% of the fair market value on designated days within
24-month offering periods. Employees may authorize the Company to withhold up to
10% of their compensation during any offering period, subject to certain
limitations. In addition, the Compensation Committee may designate certain
offering periods during which employees may purchase shares of common stock for
cash. The ESPP authorizes up to 300,000 shares to be issued. During the year
ended March 31, 1999, 22,940 shares were issued under the ESPP at an average
price of $4.29. There are no charges or credits to income in connection with the
ESPP.

NOTE 10 -- LONG-TERM DEBT

     The Company was a party to a term loan agreement with ICICI pursuant to
which ICICI made a loan of $300,000 to the Company. The loan was secured by the
Company's trade accounts receivable and equipment and required interest at the
prime rate plus 2.5% (limited to a floor of 6% and ceiling of 9%). Quarterly
principal payments of $30,000 were originally scheduled to commence December 15,
1995. On July 23, 1996, the ICICI term loan agreement was amended to defer the
start of the quarterly payments until December 15, 1996.

     The entire outstanding balance of principal and interest was repaid on June
30, 1997.

NOTE 11 -- COMMON STOCK WARRANTS

     At March 31, 1999, 1998 and 1997, the Company had outstanding warrants to
purchase 207,000, 207,000 and 249,998 shares of the Company's common stock,
respectively (see Note 2). Warrants outstanding at March 31, 1999 are
exercisable at $8.70 per share. Warrants were exercised as follows: 124,460
shares as of March 25, 1997, and 42,998 shares as of December 18, 1997. At March
31, 1999, 1998 and 1997, 207,000, 207,000 and 249,998 shares of common stock,
respectively, were reserved for issuance upon the exercise of outstanding
warrants. All outstanding warrants at March 31, 1999 will expire on January 22,
2002.

NOTE 12 -- OPERATING LEASES

     In March 1998 the Company moved into a new headquarters facility under an
operating lease executed in November 1997. In addition to minimum rentals, the
lease provides for adjustments relating to changes in real estate taxes and
other operating expenses. The Company also rents eleven remote offices,
including five domestic sales offices and the office facilities of the Company's
subsidiaries and branches based in Delaware, the United Kingdom, Germany, India,
Korea and Singapore. Management intends to renew or replace these leases during
the normal course of business.

     Total rent expense incurred for all leases during the years ended March 31,
1999, 1998 and 1997 amounted to $474,632, $187,562 and $48,849, respectively.
Future minimum rental payments as of March 31, 1999 under leases having
noncancelable lease terms in excess of one year are as follows:

                                       47
<PAGE>   50

<TABLE>
<CAPTION>
YEAR ENDING MARCH 31,
---------------------
<S>                                                            <C>
2000.......................................................    $  371,917
2001.......................................................       341,460
2002.......................................................       323,035
2003.......................................................       270,320
                                                               ----------
                                                               $1,306,732
                                                               ==========
</TABLE>

NOTE 13 -- INCOME TAXES

     No provision for income taxes was recorded for the year ended March 31,
1997 due to the Company's significant net operating loss position. The
components of income tax expense for the years ended March 31, 1999 and 1998 are
as follows:

<TABLE>
<CAPTION>
                                                               YEAR ENDED MARCH 31,
                                                               --------------------
                                                                 1999        1998
                                                               --------    --------
<S>                                                            <C>         <C>
Current:
  Foreign..................................................    $204,800    $     --
Deferred:
  Federal..................................................          --     219,000
  State....................................................      20,200     146,000
                                                               --------    --------
                                                               $225,000    $365,000
                                                               ========    ========
</TABLE>

     As required under provisions of Section 481(a) of the U.S. Internal Revenue
Code, effective April 1, 1998, the Company changed its method of accounting for
tax reporting purposes from the cash method to the accrual method. The related
adjustment is includable in income ratably over a four-year period.

     The components of the net deferred tax asset (liability) are as follows:

<TABLE>
<CAPTION>
                                                                   MARCH 31,
                                                            ------------------------
                                                              1999          1998
                                                            ---------    -----------
<S>                                                         <C>          <C>
Net deferred tax asset (liability) resulting from using
  the cash method of accounting for tax reporting,
  attributable to:
  Accounts payable........................................  $      --    $   427,621
  Accrued payroll and related taxes.......................         --        316,534
  Deferred maintenance revenue and advance royalty........         --        341,990
  Accrued royalties.......................................         --         91,027
  Accounts receivable, net................................         --     (2,318,055)
  Prepaid expenses........................................         --        (85,101)
  Other, net..............................................         --         86,712
                                                            ---------    -----------
                                                                   --     (1,139,272)
Tax effect of unrealized gains and losses on
  investments.............................................    (13,800)        (9,700)
Tax effect of Section 481(a) adjustment...................   (788,000)            --
Tax effect of federal and state net operating loss
  carryforwards...........................................    406,840        776,642
                                                            ---------    -----------
Deferred tax (liability), net.............................  $(394,960)   $  (372,330)
                                                            =========    ===========
</TABLE>

                                       48
<PAGE>   51

     Following are the significant differences between the U.S. Federal
statutory tax rate and the Company's effective tax rate for financial statement
purposes for the years ended March 31, 1999 and 1998:

<TABLE>
<CAPTION>
                                                                 YEAR ENDED
                                                                  MARCH 31,
                                                                -------------
                                                                1999    1998
                                                                ----    -----
<S>                                                             <C>     <C>
Federal statutory tax rate..................................    34.0%    34.0%
State income taxes..........................................     2.1      6.6
Reduction in valuation allowance............................     0.0    (24.7)
Other, net..................................................    (0.4)    (3.2)
                                                                ----    -----
Effective tax rate..........................................    35.7%    12.7%
                                                                ====    =====
</TABLE>

     Pretax earnings of the Company's foreign operations were $237,038 and
$88,610 for the years ended March 31, 1999 and 1998. The Company had no foreign
operations during the year ended March 31, 1997.

     The Company had unused net operating loss carryforwards available at March
31, 1999 that may be applied to reduce future taxable income as follows:

<TABLE>
<CAPTION>
                                                         NET OPERATING LOSS
                   EXPIRES DURING                          CARRYFORWARDS
                     YEAR ENDING                       ----------------------
                      MARCH 31,                         FEDERAL       STATE
                   --------------                      ----------    --------
<S>                                                    <C>           <C>
                         2000........................  $       --    $289,226
                         2001........................          --     233,162
                         2012........................     963,558          --
                         2013........................      61,651          --
                                                       ----------    --------
                                                       $1,025,209    $522,388
                                                       ==========    ========
</TABLE>

     The expected statutory tax benefit of the then-available net operating loss
carryforwards was recorded as a reduction in the income tax provision for
financial reporting purposes for the year ended March 31, 1998. If an "ownership
change" were to occur, within the meaning of the Internal Revenue Code of 1986,
as amended, the utilization of net operating loss carryforwards would be subject
to an annual limitation.

NOTE 14 -- EARNINGS PER SHARE

     Basic EPS is based on the weighted average number of common shares
outstanding in each year. Diluted EPS is similar to basic EPS, except that the
weighted average of common shares outstanding is increased to include the
additional common shares that would have been outstanding if the potential
dilutive common shares, consisting of shares of those stock options and warrants
for which market price exceeds exercise price, had been issued.

     The following is a reconciliation of the denominators (the number of
shares) of the basic and diluted EPS. The numerator (earnings, or net income
(loss)) is the same for the basic and the diluted EPS computations for all
periods presented.

<TABLE>
<CAPTION>
                                                           YEARS ENDED MARCH 31,
                                                     ---------------------------------
                                                       1999        1998        1997
                                                     ---------   ---------   ---------
<S>                                                  <C>         <C>         <C>
Basic shares.......................................  5,954,472   5,145,032   3,037,484
Effect of dilutive securities--options and
  warrants.........................................    167,639     271,537          --
                                                     ---------   ---------   ---------
Diluted shares.....................................  6,122,111   5,416,569   3,037,484
                                                     =========   =========   =========
</TABLE>

     Options and warrants excluded from the computation of diluted shares
because their exercise prices were above the average market price of the common
shares totaled 314,175 shares and 57,500 shares for the years ended March 31,
1999 and 1998, respectively.

                                       49
<PAGE>   52

NOTE 15 -- RELATED PARTY TRANSACTIONS

     In September 1996 the Company sold 4,139 shares of common stock to a
director and 43,450 shares to family members of a director at a value of $3.62
per share, for an aggregate purchase price of $172,440.

     A portion of the annual salaries of two officers and shareholders,
aggregating $127,106, was deferred in a prior year. Interest at 7% was accrued
on the deferred salaries, with related interest of $2,595 charged to expense
during the year ended March 31, 1997. The Company also issued warrants, on the
basis of one warrant (pre-split) for each dollar of deferred salary, to purchase
57,529 shares of common stock at a value of $.02 per share (see Note 11).
Effective July 1996, the entire balance of principal and accrued interest was
converted into 52,827 shares of the Company's common stock at a value of $3.31
per share.

NOTE 16 -- COMMITMENTS AND CONTINGENCIES

     The Company has entered into employment/severance (change in control)
agreements with four executive officers and has employment agreements with
certain key employees that provide for minimum annual salaries and automatic
annual renewal at the end of the initial two-year term. The agreements generally
contain, among other things, confidentiality agreements, assignment to the
Company of inventions made during employment (and under certain circumstances
for two years following termination of employment) and non-competition
agreements for the term of the agreements plus two years. The executive
employment/severance agreements provide for payments of up to one year's
compensation if there is a change of control in the Company, as defined, and a
termination of employment. The maximum contingent liability under these
agreements was approximately $556,000 at March 31, 1999.

     The Company had outstanding irrevocable letters of credit totaling $392,000
at March 31, 1999. These letters of credit, which expire on various dates
between October 1999 and November 2000, serve as collateral on certain Company
lease obligations.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS IN ACCOUNTING AND
        FINANCIAL DISCLOSURE

     None.

                                    PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF SEEC

     Raj Reddy, Chairman of the Board of Directors and a director since 1988,
notified the Company of his intent not to stand for reelection as a director
when his term of office expires at the Annual Meeting of Shareholders on August
5, 1999. Dr. Reddy plans to continue to consult with the Company on strategic
matters.

     Dr. Reddy, age 60, also recently retired from his position as Dean of the
School of Computer Science at Carnegie Mellon University in order to pursue
personal interests.

     Other information regarding this item appears in the Company's definitive
Proxy Statement to be filed pursuant to Regulation 14A relating to the Company's
Annual Meeting of Shareholders on August 5, 1999 and is incorporated herein by
reference to this Item 10.

ITEM 11. EXECUTIVE COMPENSATION.

     Information regarding this item appears in the Company's definitive Proxy
Statement to be filed pursuant to Regulation 14A relating to the Company's
Annual Meeting of Shareholders on August 5, 1999 and is incorporated herein by
reference to this Item 11.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     Information regarding this item appears in the Company's definitive Proxy
Statement to be filed pursuant to Regulation 14A relating to the Company's
Annual Meeting of Shareholders on August 5, 1999 and is incorporated herein by
reference to this Item 12.

                                       50
<PAGE>   53

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     Information regarding this item appears in the Company's definitive Proxy
Statement to be filed pursuant to Regulation 14A relating to the Company's
Annual Meeting of Shareholders on August 5, 1999 and is incorporated herein by
reference to this Item 13.

                                    PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

     (a) Documents filed as part of this Report

     1. FINANCIAL STATEMENTS. The following financial statements of the Company
are filed as part of this Annual Report on Form 10-K:

<TABLE>
<CAPTION>
                                                                   PAGE
                                                                  NUMBER
                                                                  ------
    <S>                                                           <C>
    Report of Independent Certified Public Accountants..........     33
    Consolidated Balance Sheets as of March 31, 1999 and 1998...     34
    Consolidated Statements of Operations for the years ended
      March 31, 1999, 1998 and 1997.............................     35
    Consolidated Statements of Shareholders' Equity (Deficit)
      for the years ended March 31, 1999, 1998 and 1997.........     36
    Consolidated Statements of Cash Flows for the years ended
      March 31, 1999, 1998 and 1997.............................     37
    Notes to Consolidated Financial Statements..................  38-50

    2. FINANCIAL STATEMENT SCHEDULES.
    Schedule II -- Valuation and Qualifying Accounts for the
      years ended March 31, 1999, 1998 and 1997.................     54
</TABLE>

                                       51
<PAGE>   54

  3. EXHIBITS. The Exhibits listed below are filed or incorporated by reference
               as part of this Annual Report on Form 10-K.

<TABLE>
<CAPTION>
EXHIBIT
  NO.                               DESCRIPTION
-------                             -----------
<S>         <C>
 3.1  *     The Registrant's Amended and Restated Articles of
            Incorporation
 3.2  *     The Registrant's Amended and Restated Bylaws
10.1  *     SEEC, Inc. 1994 Stock Option Plan
10.2  *     Cooperation and Project Financing Agreement dated June 1,
            1990, as supplemented and amended, among the Industrial
            Credit and Investment Corporation of India, Limited
            ("ICICI"), ERA and the Registrant
10.3  *     Loan Agreement dated June 20, 1994 between ICICI and the
            Registrant, as amended
10.4  *     International Software Marketing and License Agreement dated
            November 29, 1993 between Viasoft, Inc. and the Registrant,
            as amended
10.5  *     Product Purchase Agreement dated as of March 31, 1996
            between the Registrant and ERA
10.6  *     Marketing Agreement dated as of March 1, 1996 between the
            Registrant and ERA
10.7  *     Stock Purchase Agreement dated as of July 15, 1996 among the
            Registrant, Glen Chatfield and certain former noteholders of
            the Registrant
10.8  *     Stock Purchase Agreement dated as of August 15, 1996 among
            the Registrant and certain purchasers of its Common Stock
10.9  *     Registration Rights Agreement dated as of August 15, 1996
            among the Registrant and certain of its shareholders
10.10 *     Employment Agreement dated October 1, 1996 between the
            Registrant and Ravindra Koka
10.11 *     Employment Agreement dated October 1, 1996 between the
            Registrant and John D. Godfrey
10.12 *     Employment Agreement dated October 1, 1996 between the
            Registrant and Richard J. Goldbach
10.13 *     Agreement dated July 16, 1996 between the Registrant and Raj
            Reddy
10.14 *     Trust Agreement dated August 4, 1992 among the Registrant,
            Ravindra Koka and
            Dr. K. Buddhiraju
10.15 **    SEEC, Inc. 1997 Stock Option Plan
10.16 **    Letter Employment Agreement dated December 26, 1996 between
            the Registrant and Allen D. Gart
10.17 **    Amendment dated January 1, 1997 to Product Purchase
            Agreement between the Registrant and ERA
10.18       Asset Purchase Agreement dated August 7, 1998, between the
            Registrant and ERA
10.19 ***   SEEC, Inc. 1998 Employee Stock Purchase Plan
21.1        Subsidiaries of the Company
27          Financial Data Schedule
</TABLE>

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

*   Incorporated by reference to Exhibits to the Company's Registration
    Statement on Form S-1, File No. 333-14027.
**  Incorporated by reference to Exhibits to the Company's Annual Report on Form
    10-K for the fiscal year ended March 31, 1997, File No. 0-21985.
*** Incorporated by reference to the Company's Registration Statement on Form
    S-8, File No. 333-62149.

                                       52
<PAGE>   55

                                   SIGNATURES

     Pursuant to the requirements of Section 13 or 15 (d) of the Securities Act
of 1934, the registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.

                                          SEEC, INC.
June 15, 1999
                                          By:        /s/ RAVINDRA KOKA
                                             -----------------------------------
                                                       Ravindra Koka
                                             President, Chief Executive Officer
                                                         and Director

     Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.

<TABLE>
<CAPTION>
                    SIGNATURE AND TITLE                                       DATE
                    -------------------                                       ----
<S>                                                          <C>

                       /s/ RAVINDRA KOKA                                  June 15, 1999
------------------------------------------------------------
                       Ravindra Koka
      President, Chief Executive Officer and Director

                      /s/ JOHN D. GODFREY                                 June 15, 1999
------------------------------------------------------------
                      John D. Godfrey
              Vice-President-Customer Support,
                   Secretary and Director

                    /s/ RICHARD J. GOLDBACH                               June 15, 1999
------------------------------------------------------------
                    Richard J. Goldbach
           Treasurer and Chief Financial Officer

                         /s/ RAJ REDDY                                    June 15, 1999
------------------------------------------------------------
                         Raj Reddy
             Chairman of the Board and Director

                       /s/ RADHA R. BASU                                  June 15, 1999
------------------------------------------------------------
                       Radha R. Basu
                          Director

                     /s/ ABRAHAM OSTROVSKY                                June 15, 1999
------------------------------------------------------------
                     Abraham Ostrovsky
                          Director

                     /s/ GLEN F. CHATFIELD                                June 15, 1999
------------------------------------------------------------
                     Glen F. Chatfield
                          Director
</TABLE>

                                       53
<PAGE>   56

                                   SEEC, INC.

                VALUATION AND QUALIFYING ACCOUNTS -- SCHEDULE II

                   YEARS ENDED MARCH 31, 1999, 1998 AND 1997

<TABLE>
<CAPTION>
                                                                   ADDITIONS    DEDUCTIONS
                                                     BALANCE AT    CHARGED TO   CREDITED TO   BALANCE AT
                                                    BEGINNING OF   COSTS AND     ACCOUNTS       END OF
                   DESCRIPTION                         PERIOD       EXPENSES    RECEIVABLE      PERIOD
                   -----------                      ------------   ----------   -----------   ----------
<S>                                                 <C>            <C>          <C>           <C>
Allowance for doubtful accounts for Accounts
  Receivable -- Trade for the year ended:
MARCH 31, 1999....................................    $50,000       $175,363      $15,363      $210,000
MARCH 31, 1998....................................    $10,000       $ 71,975      $31,975      $ 50,000
MARCH 31, 1997....................................    $ 7,776       $  9,392      $ 7,168      $ 10,000
</TABLE>

                                       54