<PAGE>   1
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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 SEPTEMBER 30, 1996.*
 
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
    ACT OF 1934.
 
          FOR THE TRANSITION PERIOD FROM                TO                .
 
                           COMMISSION FILE NUMBER: 0-11348
 
                             SILICON VALLEY GROUP, INC.
               (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
 
<TABLE>
<S>                                            <C>
                  DELAWARE                                      94-2264681
        (STATE OR OTHER JURISDICTION                        OF (I.R.S. EMPLOYER
       INCORPORATION OR ORGANIZATION)                     IDENTIFICATION NUMBER)
    101 METRO DRIVE, SUITE 400, SAN JOSE,                          95110
                  CALIFORNIA
  (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)                      (ZIP CODE)
</TABLE>
 
       REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (408) 441-6700
 
          SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT:
                          COMMON STOCK, $.01 PAR VALUE
 
     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. [X]
 
     The aggregate market value of the voting stock held by persons other than
those who may be deemed affiliates of the Registrant, as of November 29, 1996,
was approximately $636,778,000. Shares of Common Stock held by each executive
officer and director and by each person who owns 5% or more of the outstanding
Common Stock have been excluded in that such persons may under certain
circumstances be deemed to be affiliates. This determination of executive
officer or affiliate status is not necessarily a conclusive determination for
other purposes.
 
     The number of shares outstanding of the Registrant's Common Stock as of
November 29, 1996 was 30,177,634.
 
* See Part II, Item 8 of this report for information regarding Registrant's
  fiscal year.
 
                      DOCUMENTS INCORPORATED BY REFERENCE
 
     Portions of the following documents are incorporated by reference into the
parts of this Form 10-K indicated:
 
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        <S>                                                             <C>
        Proxy Statement for Annual Meeting of Stockholders to be held
          on February 20, 1997........................................        Part III
        Annual Report to Stockholders for fiscal year ended September
          30, 1996....................................................   Parts II & IV
</TABLE>
 
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<PAGE>   2
 
                                     PART I
 
ITEM 1.  BUSINESS.
 
     The information in this report contains forward looking statements within
the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934, as amended. Such statements are subject to
certain risks and uncertainties, including those discussed below and set out in
the Annual Report incorporated by reference herein, that could cause actual
results to differ materially from those described herein. Readers are cautioned
not to place undue reliance on these forward looking statements, which speak
only as of the date hereof. Forward looking statements are indicated by an
asterisk (*) following the sentence in which such statement is made. The Company
undertakes no obligation to publicly release the results of any revisions to
these forward looking statements which may be made to reflect events or
circumstances after the date hereof or to reflect the occurrence of
unanticipated events.
 
     Silicon Valley Group, Inc. (the "Company" or "SVG") designs, manufactures,
markets and services semiconductor processing equipment used in the fabrication
of integrated circuits. The fabrication of integrated circuits involves
repeating a complex series of process steps to a semiconductor wafer. The three
broad categories of wafer processing steps are deposition, photolithography and
etching. The Company has three principal product groups which focus primarily on
photolithography, photoresist processing, and deposition for oxidation/diffusion
and low pressure chemical vapor deposition ("LPCVD"). The Company's products
incorporate proprietary technologies and unique processes, and focus on
providing process and product technologies and productivity enhancements to its
customers. The Company supports its products through a network of worldwide
service and technical support organizations. The Company works closely with its
existing and potential customers. As evidence of the Company's commitment to its
customers, in February 1995 the Company entered into a business relationship
with Intel, Motorola and Texas Instruments (the "Investors") pursuant to which
such companies made an equity investment in the Company.
 
     The Company manufactures and markets its photolithography exposure products
through its majority owned subsidiary, SVG Lithography Systems, Inc. ("SVGL"),
its photoresist processing products through its Track Systems Division ("Track")
and its oxidation/diffusion and LPCVD products through its Thermco Systems
Division ("Thermco").
 
INDUSTRY BACKGROUND
 
     Continuous improvements in semiconductor process and design technologies
have led to the production of smaller, more complex and more reliable devices at
a lower cost per function. As performance has increased and size and cost have
decreased, the demand for semiconductors has expanded beyond the primary market
in computer systems to include applications in telecommunications systems,
automotive products, consumer goods and industrial automation and control
systems. Semiconductor content as a percentage of system cost has also
increased. In addition, the demand for electronic systems has expanded
geographically, particularly in the Pacific Rim. The Company believes that these
longterm trends will continue and will be accompanied by a growing demand for
semiconductor production equipment that can produce advanced integrated circuits
in high volumes with a low cost of ownership.*
 
     The rapid development of advanced semiconductor applications requires
semiconductor manufacturers to continually improve their core technology and
manufacturing capabilities to remain competitive within the industry. As a
consequence, semiconductor manufacturers demand increasingly sophisticated, cost
effective processing equipment from semiconductor equipment suppliers. The
increasing diversity and complexity of semiconductor products, the demands of
technological change and the costs associated with keeping pace with industry
developments have contributed to the emergence of cooperative development and
manufacturing alliances both between semiconductor manufacturers and between
semiconductor manufacturers and semiconductor equipment suppliers. The Company
believes it is essential to have customer alliances to provide access to
valuable product and process technologies. These factors result in customers
concentrating their business with a small number of key suppliers.
 
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<PAGE>   3
 
STRATEGY
 
     The Company's objective is to strengthen its position as a leading
worldwide semiconductor equipment supplier that offers a broad line of
technologically advanced products. The Company's strategy incorporates the
following key elements:
 
     - Technological Innovation.  The Company is committed to developing new
       products, improving processes and enhancing existing products through
       substantial investment in research and development. SVG designs and
       manufactures sophisticated semiconductor manufacturing systems for
       advanced fabrication facilities. Its products incorporate proprietary
       technologies in photolithography, control software, optics and
       particulate control and unique processes focusing on providing process
       and product technologies and productivity enhancements to customers.
       Additionally, the Company works with universities and laboratories to
       leverage new concepts for its advanced projects.
 
     - Customer Collaboration.  The Company's objective is to strengthen its
       position as a leading worldwide semiconductor equipment supplier by
       offering a broad line of technologically advanced products. SVG works
       closely with its existing and potential customers, industry consortia and
       research institutions to improve current products and processes and to
       define new product development opportunities. These efforts enable the
       Company to participate in the development of new technologies, to
       influence the design of new fabrication processes and to position itself
       as a principal supplier for volume equipment orders. The Company believes
       that cooperative working relationships with leading semiconductor
       manufacturers are critical to ensuring that its products are designed in
       conjunction with the development of the semiconductor manufacturers'
       advanced process requirements.
 
     - Continuous Improvement.  The industry requires that equipment suppliers
       provide cost effective products that are based on extendable technology.
       Cost of ownership and the ability to satisfy customer delivery
       requirements are critical ingredients in the selection process for
       advanced equipment. SVG is responding by expanding its facilities and
       deploying capital for manufacturing and test equipment to respond to the
       requirements of the semiconductor industry. Additionally, the Company is
       implementing programs to increase the effectiveness of its material
       procurement, reduce manufacturing cycle times and improve production
       methods and processes to gain additional efficiencies.
 
     - Expanding Worldwide Customer Service and Support.  The Company's
       customers are concentrating their business with a smaller number of key
       suppliers and demanding higher levels of support and service from these
       suppliers as the semiconductor fabrication process becomes increasingly
       complex. The Company has responded to this trend by making substantial
       investments in its global service and support capabilities.
 
SVG LITHOGRAPHY SYSTEMS, INC. (SVGL)
 
     SVGL designs, manufactures, markets and services advanced photolithography
exposure systems. Photolithography is one of the most critical and expensive
steps in integrated circuit fabrication, representing approximately one-third of
the fabrication cost. Consequently, integrated circuit manufacturers focus on
obtaining advanced photolithography equipment to help them produce critical
layers for increasingly complex devices reliably, efficiently and
cost-effectively.
 
     In the photolithography step of the fabrication process, the integrated
circuit patterns are projected through masks, or reticles, onto the silicon
wafers. As semiconductors have become more complex, the patterns have become
finer, with line widths as narrow as 0.25 micron (approximately 10 millionths of
an inch) in many of today's more advanced integrated circuits. As the patterns
become finer, photolithography exposure systems must be capable of projecting
the patterns through the masks with ever finer resolution. The resolution
capability of a photolithography exposure system is a function of its depth of
focus, numerical aperture (a measure of its light gathering characteristics) and
the wavelength of the light used in pattern projections. With the advancement of
photolithography technology has come a trend toward the reduction in wavelength
from G-line (436 nanometer) to I-line (365 nanometer) to Deep UV (248-193
nanometer) and the increase in numerical aperture from 0.2 to 0.6.
 
                                        2
<PAGE>   4
 
     Historically, there have been two major approaches to photolithography
exposure systems: full field scanners and conventional refractive systems. The
full field scanners project a full scale mask image onto full wafers while the
refractive systems (steppers) sequentially expose small sections of a wafer in a
stepped sequence of exposures, but do so by reducing the size of a mask image by
several fold (typically 5 times). Thus, scanners offer large exposure fields
while steppers offer masks that are easier to make and have a lower cost. These
strengths are combined in the step and scan system.
 
     Micrascan.  The Company believes that its Micrascan photolithography
exposure system provides the greater resolution required for current advanced
logic and memory devices and for succeeding generations of complex, fine
geometry integrated circuits through its use of Deep UV lamp and laser light
sources and overcomes the throughput, yield and line-width limitations of
steppers by combining the elements of both steppers and scanners into the
Micrascan's "step and scan" technology.*
 
     The Micrascan combines advantages of scanning projection aligners and
steppers by scanning a portion of the wafer, then "stepping" to another portion
of the wafer and repeating the process as necessary. Each scan has the
capability to expose a large segment of the wafer. The large exposure field
enables Micrascan to fabricate larger devices in a single scan than steppers,
thus avoiding the necessity of "stitching" a circuit together through two
different exposures. In addition, Micrascan continuously modifies the position
of the wafer surface during the scan to keep the wafer in the optimal focal
plane, thereby providing Micrascan a larger usable depth of focus field than
steppers. The larger the usable depth of focus field is, the more tolerant of
variations in the wafer surface the equipment will be. The Company believes
Micrascan's greater tolerance of wafer surface variations can reduce the number
of defective devices on a wafer, thereby contributing to higher yields.* It
further believes that scanning across the field instead of exposing the entire
field at one time also enables Micrascan to achieve greater uniformity of
resolution across the entire exposure field and contributes to higher yields.*
 
     The Company believes that SVGL has substantial technological expertise and
process knowledge in developing Deep UV step and scan photolithography systems.
SVGL has developed internal capability to design and fabricate optical lenses,
mirrors and coatings. This includes a combination of purchased and proprietary
optical metrology using phase measuring interferometry to precisely measure and
test the optical elements it produces. Micrascan incorporates both mirrors and
lenses in its optical system, which the Company believes allows for a higher
power optical projection system, is less sensitive to environmental variants and
accommodates the use of light sources with broader spectral bandwidth (than
refractive optics), with the additional benefits of reduced running cost and
increased reliability.*
 
     In addition to the optical system technology described above, SVGL has
developed certain proprietary mechanical systems incorporated in the Micrascan
to control the alignment of the wafer and the reticules prior to and during the
wafer exposure step. These alignment systems contribute to the Micrascan's
ability to scan the exposure field at speeds of 50mm per second or greater with
no significant loss of resolution, thereby increasing the throughput capability
of the machine.
 
     The Company believes that many of the more complex semiconductor devices
currently under development, such as the most advanced microprocessors and
DRAMs, will benefit from the larger exposure field scanned by the Micrascan.* In
addition, these more complex devices feature increasingly narrow line widths,
which require greater resolution in exposing the photoresist. The Company
believes that as these larger and more complex logic and memory devices move
from development and pre-production to production, the technical advantages of
Deep UV step and scan systems over existing I-Line and Deep UV steppers will
provide a greater incentive to semiconductor manufacturers to purchase step and
scan systems rather than steppers in order to achieve more precise line-width
control, higher yields and faster throughput. Although certain companies are
currently using the Micrascan II in production, the Company believes that
manufacturers will not begin volume production of advanced devices which will
benefit most from the utilization of Deep UV step and scan technology until late
1997 or 1998. The Company believes the SVGL Micrascan II series of
photolithography systems, capable of printing .30 micron line widths, are
currently the most technically advanced step-and-scan machines shipping in
multiple quantities to global semiconductor manufacturers.* However, competitive
equipment capable of producing .25 micron line widths using step-and-scan
technology
 
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<PAGE>   5
 
is currently available in limited quantities. The Micrascan II systems which the
Company is now shipping in volume sell for up to approximately $5,300,000,
depending upon configuration. The Micrascan systems capable of printing .25
micron line widths which the Company expects to begin shipping in the first half
of fiscal 1997 sell for up to approximately $7,200,000, depending upon
configuration.
 
     Uncertain Development of Market for Micrascan Products.  The development of
a market for the Company's Micrascan photolithography products will be highly
dependent on the continued trend towards finer line widths in integrated
circuits and the ability of lithography manufacturers to keep pace with this
trend through either enhanced technologies or improved processes. The market for
the Company's Micrascan photolithography products has developed more slowly than
the Company anticipated at the time the Company acquired SVGL in May 1990. From
its inception in fiscal 1990, through the end of fiscal 1996, SVGL sold an
aggregate of 83 Micrascan systems, of which 38 were shipped in fiscal 1996. At
September 30, 1996, SVGL had a sales order backlog of 38 Micrascan units for
shipment. In addition to the systems included in backlog, SVGL had orders for 18
systems which had scheduled delivery dates outside the twelve month backlog
window, including orders for seven advanced technology 193 nanometer Micrascan
systems currently under development. While such orders are encouraging, they are
not necessarily indicative of industry-wide acceptance of the Micrascan
technology. The Company and many industry observers initially believed that
I-Line steppers, the most advanced photolithography exposure equipment in
widespread production use at the time the Company acquired SVGL, could not be
modified to be capable of fabricating complex semiconductor devices with line
widths of less than 0.5 micron, such as 64 and 256 megabit dynamic random access
memories ("DRAMs"). Since 1990, however, stepper manufacturers have extended the
capability of their I-Line steppers to 0.5 micron or finer line widths and
customers can purchase Deep UV steppers to produce product at .25 micron line
widths. The Company believes that as a result of such enhancements,
manufacturers of complex devices continued to use steppers for fabricating such
devices. The Company believes that as devices increase in size and complexity
and require finer line widths, the technical advantages of Micrascan systems as
compared to steppers will enable semiconductor manufacturers to achieve finer
line widths, higher yields and increased throughput.* The Company believes that
advanced semiconductor manufacturers are beginning to require volume quantities
of production equipment as advanced as the current and pending versions of
Micrascans; however, it does not believe that substantial sales of such systems
will begin until late calendar 1997 or 1998.* If manufacturers of traditional
I-line or Deep UV steppers are able to further enhance existing technology to
achieve finer line widths sufficiently to erode Micrascan's competitive and
technological advantages, demand for the Micrascan technology may not develop as
the Company expects.* While the recent volume of orders for Micrascan systems
has been consistent and encouraging, they are not necessarily indicative of
industry-wide acceptance of the Micrascan technology. Although SVGL has been
profitable during fiscal 1996, the Company believes that with the costs
associated with the continued development of multiple generations of Micrascan
technology, the expansion of SVGL's manufacturing capacity, the additional
manpower requirements related to the expanded capacity and customer support and
the potential difficulties inherent in manufacturing initial quantities of the
 .25 micron Micrascan systems, there can be no assurance that SVGL will be able
to operate profitably in the future.* Failure of SVGL to develop adequate
production capability to supply a substantial number of systems in response to
customer demand, or a delay in supplying such systems, could have a material
adverse effect on the Company's ability to continue to operate profitably.*
 
     The Company believes that for SVGL to succeed in the long term, it must
sell its Micrascan products on a global basis. The Japanese market (including
fabrication plants operated outside Japan by Japanese semiconductor
manufacturers) and the Korean market represent a substantial portion of the
overall market for photolithography exposure equipment. To date, the Company has
not been successful penetrating either of these markets. In April 1993, the
Company entered into a letter of intent with Canon, Inc. ("Canon"), a major
Japanese company, for the purpose of establishing a worldwide strategic alliance
based on SVGL's Micrascan technology. The Company and Canon were unable to reach
agreement and the letter of intent expired on November 30, 1994. Although Canon
is contractually prohibited until April 2003 from manufacturing a specifically
defined step and scan photolithography machine or disclosing related
information, Canon could introduce a product that includes certain step and scan
technology without violating this prohibition. As
 
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<PAGE>   6
 
a result of the expiration of the letter of intent, the Company believes that
Canon has accelerated its previously suspended development of a step and scan
photolithography product which will compete with Micrascan.
 
     The Company believes that its current customer base of semiconductor
manufacturers in the U.S. and Europe, and the Korean companies that have
purchased initial quantities of the product will order a sufficient number of
units to establish the Micrascan as a competitive technology.* It is also
possible that Japanese manufacturers may follow. In order for SVGL to become a
viable competitor in the Lithography business, it must be able to continue the
timely development, introduction and shipment of new technology systems into the
marketplace. To accomplish this, it must not only maintain its product
development effort, but it must also build an efficient manufacturing operation,
capable of supplying systems in quantities sufficient to meet the requirements
of multiple global customers. Additionally, it must develop a supplier
infrastructure capable of providing timely, cost effective and quality
components. In addition to the development and manufacturing of systems capable
of meeting customer requirements, the Company must have a qualified global
support and parts distribution function capable of servicing customers
worldwide. There can be no assurance that SVGL will be successful in these
endeavors.
 
     Micralign.  SVGL also sells a family of scanning projection aligners known
as "Micralign." The most advanced product in this family, the Micralign 700, is
used primarily in the production of semiconductor devices with minimum feature
sizes above 1.25 microns, or in the fabrication of less critical layers within
more sophisticated semiconductor devices. Micralign products are a mature
product family and sales of Micralign products have declined in recent years as
steppers have supplanted projection. The Company anticipates that such sales
will continue to decline.* A large installed base of Micralign systems exists
throughout the world and a majority of SVGL's Micralign related revenues is
derived from servicing that installed base and the sales of spare parts. The
list price of the Micralign 700 is approximately $1,250,000.
 
TRACK SYSTEMS DIVISION (TRACK)
 
     Track designs, manufactures, markets and services photoresist processing
equipment which performs all the steps necessary to process semiconductor wafers
prior to photolithography exposure, including cleaning, adhesion promotion and
photoresist coating, and which performs all the steps required to treat wafers
after photolithography exposure prior to etching, including developing and
baking. As photoresist processing technology has evolved, SVG has developed
increasingly advanced product lines for this market, which are capable of
handling integrated circuits with line widths as narrow as 0.25 micron. Each
product line includes the principal processing capabilities described above and
is generally sold in customer-specified configurations that can include
specially engineered features and capabilities. All of the Track products are
available in fully automated cassette-to-cassette configurations either as
stand-alone processing stations or as in-line integrated manufacturing systems.
The equipment is modular in design to allow configuration to customer
requirements. Each semiconductor manufacturer may require certain of the
processing stations to effect its proprietary or specialized processes. SVG
believes it is the only manufacturer to offer a cluster which integrates its
photolithography and photoresist products. In addition, the Track 90-S product
is designed to interface with all stepper products in the industry.
 
     Track offers four product lines, each corresponding to the development of
successive generations of wafer processing technologies. In general, it has been
the Company's experience that introduction of new Track products has been
followed by lower order levels for older products.
 
     200-APS.  Introduced in July 1996, the 200-APS is designed for eight inch
advanced fabrication processes for integrated circuits with line widths down to
 .18 micron, such as 256 megabit DRAMs. The system is smaller than the Company's
90-SE and potentially offers customers a lower cost-of-ownership through
improvements in productivity such as a lower floorspace requirement, direct
module-to-module robotic wafer-transfer, and reduced photoresist consumption.
The 200-APS has improved process capabilities including improved wafer coating
uniformities, highly precise wafer transport timing controls and proprietary
photoresist dispense technologies. The Company expects to ship production units
of the 200-APS during the second quarter of fiscal 1997.* Prices of the 200-APS
will range from approximately $1,000,000 to $2,100,000.
 
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<PAGE>   7
 
     90 Series.  The 90 Series, the 90-S and the 90-SE photoresist processing
systems are designed for use in fabrication processes for integrated circuits
with line widths as narrow as 0.25 micron, such as is required for 64 megabit
DRAMs. The 90 Series incorporates a proprietary wafer transfer system to
increase throughput, features substantially improved contamination control
specifications as compared to the Company's earlier products and provides
features allowing it to interface with factory automation systems, such as those
using automated guided vehicles. The 90 Series can process wafers up to eight
inches in diameter. The 90-S and the more recent 90-SE offer improved cost of
ownership through increased productivity and a smaller floor space requirement.
Prices of the 90 Series range from approximately $650,000 to $1,500,000.
 
     8800 Series.  The 8800 Series is designed to meet market needs for
photoresist contamination control and photoresist processing down to 0.8 micron
line widths. The 8800 Series incorporates such automation features as beltless
wafer handling, compatibility with low contamination wafer storage and movement
techniques, advanced software and communications capabilities and certain
process control improvements. The 8800 Series can process wafers from three to
six inches in diameter. Prices of the 8800 Series range from approximately
$350,000 to $750,000.
 
     8600 Series.  The 8600 Series is a belt-based wafer transport system
capable of processing wafers with diameters of three to six inches and of
supporting the needs of photoresist processing down to 1.0 micron line widths.
The 8600 Series is typically purchased for expansion of current fabrication
capacity. Prices of the 8600 Series range from approximately $200,000 to
$400,000.
 
THERMCO SYSTEMS DIVISION (THERMCO)
 
     Thermco designs, manufactures, markets and services large batch thermal
products which address the oxidation/diffusion and LPCVD steps of the
semiconductor fabrication process. Thermco products are used for a broad range
of processing applications required in the fabrication of most semiconductor
devices, including growing insulating layers on the wafers, diffusing dopants
into the silicon structure and depositing insulating or conducting films on the
wafer surface. Thermco's products incorporate proprietary technology the Company
has developed in the areas of thermal control, gas handling, particle control
and automated wafer handling.
 
     There are two major configurations of thermal processing equipment,
commonly referred to as vertical and horizontal, corresponding to the
orientation of their reaction chamber(s). Vertical processing systems represent
an increasing portion of the market for oxidation/diffusion and LPCVD processing
equipment. Vertical reactors generally consist of a single, fully automated
cylindrical reaction chamber, individually controlled by a dedicated computer
control system. Vertical systems generally provide greater process uniformity
and lower particle contamination than do horizontal systems, due to improved
thermal control and an increased ability to maintain environmental integrity,
thereby achieving higher yields in wafer processing. Additionally, vertical
systems provide more flexibility in manufacturing configurations. Horizontal
thermal processing systems, which are typically much larger and less automated
than vertical reactors, were the standard of the semiconductor processing
equipment industry and are still used for a broad range of processes.
 
     Series 9000 Rapid Vertical Processor ("RVP").  Thermco's most recent
vertical furnace, the RVP was introduced in 1996. It is based on the AVP
platform, processes both eight inch and six inch wafers and meets sub-.50 micron
technology requirements. The RVP features a proprietary and patented design that
enables it to ramp up and ramp down temperatures anywhere between twice and ten
times as fast as the AVP and offers faster throughput and tighter junction depth
control for critical anneals. By utilizing the AVP platform, the Company
believes that the RVP, which incorporates key features of the AVP, such as
16-cassette wafer handling and model based temperature control (MBTC), offers
the high reliability of the established AVP product line. The typical price
range of an RVP system is $1,100,000 to $1,500,000, depending on process
configuration.
 
     Series 8000 Advanced Vertical Processor ("AVP").  Initially shipped in
September 1992, the AVP is a vertical furnace designed to meet the eight and six
inch wafer requirements of sub-.50 micron processing. The Series 8000 single
tube systems include advanced process control, data acquisition software,
advanced automation, a proprietary process chamber design and an option for
atmospheric control within the wafer
 
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<PAGE>   8
 
handling area. Key features of the AVP system include storage capacity for
sixteen 25-wafer cassettes (400 wafers), and model based temperature control
(MBTC) for accurate wafer temperature regulation. The AVP system is designed to
offer customers a low cost of ownership, through high productivity and a low
square footage requirement. The typical price range of an AVP system is $700,000
to $1,000,000, depending on process configuration.
 
     Vertical Thermal Reactor ("VTR").  Thermco's VTR processes wafers from
100mm to 200mm in diameter. It operates under computer control, providing
specialized process recipe introduction, cassette-to-cassette automation,
monitoring of critical system functions and automated loading of wafers into the
reaction chamber. In general, the VTR offers comparable reliability, lower
contamination and better process uniformity than horizontal reactors. The VTR
can be installed through-the-wall in a customer's clean room facility and is
compatible with industry standard software interfaces. The VTR 7000PLUS offers
improved process control, uniformity, reduced particle levels, higher
throughput, internal storage capabilities and the industry's standard mechanical
interface (SMIF). Typical prices for the Company's VTR products range from
approximately $500,000 to $900,000.
 
     Horizontal Processing Systems.  The typical horizontal system consists of
four separately controlled cylindrical reaction chambers which are mounted
horizontally, one directly above the other. Horizontal systems are a mature
product family. Sales of these systems have been declining in recent years, as
semiconductor manufacturers have increasingly installed vertical reactors in
their newer fabrication facilities and the Company expects this trend to
continue. However, the Company believes that manufacturers of less complex
devices will continue to have some need for horizontal processing systems for
the foreseeable future.* In addition, the existing installed base of horizontal
processing systems enables the Company to generate revenues through the sale of
spare parts and upgrades. Prices for horizontal systems range from approximately
$400,000 to $900,000.
 
CUSTOMERS
 
     The Company's customer base includes companies that manufacture
semiconductor devices primarily for sale to others and companies that
manufacture semiconductor devices primarily for internal use. Repeat sales to
existing customers represent a significant portion of the Company's processing
equipment sales. The Company believes that its installed customer base
represents a significant competitive advantage.* By working closely with its
established customer base, SVG is able to identify new product development
opportunities. The Company's major customers during fiscal 1996 included the
following:
 
<TABLE>
      <S>                        <C>                   <C>
      Advanced Micro Devices     IBM                   Phillips Semiconductor
      Atmel                      Intel                 SGS-Thomson
      Cirrus Logic               LSI Logic             Samsung
      Hewlett-Packard            Motorola              Siemens
      Hyundai                    Newport Wafer Fab     Submicron Technology
</TABLE>
 
     The Company relies on a limited number of customers for a substantial
percentage of its sales. For fiscal 1995 Motorola, Intel, and SGS-Thomson
represented 18%, 17% and 12%, respectively, of sales and the Company's largest
five customers represented 60% of sales. In fiscal 1996, Intel, Motorola and IBM
represented 31%, 10% and 7%, respectively, of sales and the Company's largest
five customers represented 60% of sales. In fiscal 1995 and 1996, Intel
represented 36% and 47%, respectively, of Track sales. Track operations were
responsible for a substantial portion of the Company's profits in both periods.
Further, in both fiscal 1995 and 1996, Intel was the largest customer for SVGL's
Micrascan photolithography systems and represented 21% and 46%, respectively, of
SVGL sales. The loss of a significant customer (and in particular the loss of
Intel as a Track or SVGL customer), a delay in shipment due to customer
rescheduling or any substantial reduction in orders by a significant customer,
including reductions in orders due to market, economic or competitive conditions
in the semiconductor industry, could adversely affect the Company's business and
results of operations.
 
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MARKETING, SALES AND SERVICE
 
     The Company markets and sells its products primarily to independent
manufacturers of semiconductor devices and computer, telecommunications and
other companies that manufacture semiconductor devices for their own use. The
market for the Company's products is worldwide. The Company sells its products
in the United States principally through its direct sales organization. The
Company sells its products overseas through a direct sales staff, independent
distributors and independent representatives in Europe, Israel and the Far East.
The following table sets forth the Company's revenues by geographic area as a
percentage of net sales for the last three fiscal years ended September 1996:
 
<TABLE>
<CAPTION>
                                                                       YEARS ENDED
                                                                      SEPTEMBER 30,
                                                                  ----------------------
                                                                  1994     1995     1996
                                                                  ----     ----     ----
        <S>                                                       <C>      <C>      <C>
        United States...........................................   58%      68%      65%
        Western Europe..........................................   32       24       25
        Far East................................................    8        8       10
        Other...................................................    2       --       --
</TABLE>
 
     Reliability, which is commonly measured in up-time and mean time between
failure, and performance are increasingly important factors by which customers
evaluate the potential suppliers of sophisticated processing systems. The
Company believes that its field service and process support capabilities are
major factor in its selection as an equipment supplier. Increasingly,
semiconductor manufacturers are requiring seven-day, around the clock, on site
or on call support. To meet this need, SVG continues to expand its field service
organization, increase its technical and process support personnel, enhance its
training programs and increase spare part inventories deployed at both customer
sites and regional field depots. Service personnel are based in field offices
throughout the United States, Western Europe, Japan and the Pacific Rim and
increasingly on site at particularly large customer locations.
 
     The Company warrants its products against defects in design, materials and
workmanship, generally for periods ranging from one to two years.
 
BACKLOG
 
     At September 30, 1996 and 1995, the Company had backlog of approximately
$395,000,000 and $391,000,000, respectively. The Company includes in backlog
only those orders to which a purchase order number has been assigned by the
customer and for which delivery has been specified within 12 months. Such orders
are subject to cancellation by the customer with limited charges. Because of the
possibility of customer changes in delivery schedules, cancellation of orders
and potential delays in product shipments, the Company's backlog as of any
particular date may not be representative of actual sales for any succeeding
period. During fiscal 1996, the Company experienced both customer initiated
equipment delivery date delays and, to a lesser degree, customer purchase order
cancellations, both of which had an adverse effect on operating results during
the second half of the fiscal year and potentially may adversely effect
operating results during the first half of fiscal 1997.*
 
RESEARCH, DEVELOPMENT AND RELATED ENGINEERING
 
     The market served by the Company is characterized by rapid technological
change. Accordingly, the Company's product and process development programs are
devoted to the development of new systems and processes, including new
generations of products for existing markets, enhancements and extensions of
existing products and custom engineering for specific customers. The Company
believes that its future success will depend, in part, upon its ability to
successfully introduce and manufacture new and enhanced products and processes
which satisfy a broad range of customer needs and achieve market acceptance.
Accordingly, the Company works closely with semiconductor manufacturers,
industry consortia, and research institutions to respond to the industry's
evolving product and process requirements. The Company's research staff
collaborates with key customers in order to evaluate designs, specifications and
prototypes of the Company's new products.
 
                                        8
<PAGE>   10
 
     The Company believes that in selecting a photolithography equipment
manufacturer, customers look for a supplier with a long term product development
strategy and the ability to fund that development since photolithography
exposure equipment can represent a substantial portion of the equipment cost of
a fabrication facility. Semiconductor manufacturers may be unwilling to rely on
a relatively small supplier such as the Company for a critical element of the
fabrication process if they believe that the Company does not have sufficient
capital to implement its product development strategy. The Company depends in
part on external sources to fund its photolithography development efforts. The
agreements which are currently in effect are discussed in detail below.
 
     In September 1994, the Company and SEMATECH entered into a series of
agreements whereby the Company sold SEMATECH warrants to purchase the Company's
Common Stock and SEMATECH agreed, based upon the Company achieving certain
performance milestones, to provide, through 1997, $22,000,000 of funding for the
development of the Micrascan technology and to increase SVGL's manufacturing
capability and capacity. As of September 30, 1996, the Company had recognized
$17,250,000 of such SEMATECH funding. Additionally, under the agreements with
SEMATECH, the Company was obligated to provide certain funds from its own
resources. The Company has funded sufficient qualifying expenditures to fulfill
its contractual obligations under its agreement with SEMATECH.
 
     In February 1995, the Company entered into an agreement with Intel
Corporation, Motorola Inc., and Texas Instruments Incorporated (the
"Investors"), under which the Investors made a $30,000,000 equity investment in
the Company and received certain rights to purchase future generations of the
Company's Micrascan products. The Company agreed to utilize the proceeds of the
transaction for research and development related to its Micrascan technology and
the expansion of its manufacturing capacity as well as working capital for its
Micrascan products. The agreement with the Investors also obligated the Company
to fund from its own resources not less than $25,000,000, including amounts it
funded under the agreement with SEMATECH. The Company has fulfilled its funding
obligation under the agreement with the Investors.
 
     During fiscal 1996, the Company entered into agreements with certain
customers (the "Participants") whereby each Participant agreed to assist in
funding the Company's development of an advanced technology 193 nanometer
Micrascan system. In exchange for such funding, each Participant received the
right to purchase one such system and, in addition, received a right of first
refusal (ratable among such Participants) to all such machines manufactured
during the first two years following the initial system shipments. For each
initial system ordered, each Participant agreed to fund $5,000,000 in
development costs. The agreements call for each Participant to pay $1,000,000 of
initial development funding and four subsequent payments of $1,000,000 upon the
completion of certain development milestones. The Participants may withdraw from
the development program without penalty, but payments made against completed
development milestones are not refundable and all preferential rights to future
equipment are forfeited. At September 30, 1996, the Company had received
$5,000,000 in initial funding from four Participants and had received single
unit orders for systems from two other customers. There can be no assurances
that the Participants will remain in the program.* In the event that the Company
did not receive the funding anticipated under the agreements, it would be
required to replace the shortfall from its own funds or other sources. If the
Company were required to use its own funds, its research and development
expenses would increase and its operating income would be reduced
correspondingly. The agreements with the Participants stipulate that if the
Company receives funding for the development program in excess of $25,000,000,
it will issue, ratably to the Participants, credits totaling such excess in the
form of a cash discount which can be applied to the purchase of additional
systems by each Participant.
 
     The Company anticipates that it will need to continue to make substantial
research and development expenditures, particularly in its photolithography
products, in order to remain competitive in the semiconductor equipment
industry. There is no assurance that the Company will receive all funding which
it currently anticipates or that it will be able to obtain future outside
funding beyond that which it is currently receiving. If the Company were not
able to secure additional external funding, its new product development and
product enhancement efforts would either be impaired or would have an adverse
effect on the Company's results of operations.
 
                                        9
<PAGE>   11
 
     In connection with the Company's acquisition of SVGL in 1990, SVGL received
an equity investment and research and development funding commitments for
Micrascan from IBM and agreed to make future payments to IBM based on the
ongoing operating results of SVGL. As part of a subsequent agreement with the
Investors, IBM was also granted certain rights to purchase initial quantities of
future generations of the Company's Micrascan products.
 
     The Company has historically devoted a significant portion of its personnel
and financial resources to research and development programs. For fiscal years
1996, 1995, and 1994, total research and development expenditures were
approximately $72,000,000, $53,000,000, and $32,000,000, respectively, of which
approximately $5,000,000, $12,750,000, and $1,500,000, respectively, was funded
by outside parties, primarily SEMATECH, and offset against research and
development expenses.
 
COMPETITION
 
     The semiconductor equipment industry is intensely competitive. The Company
faces substantial competition both in the United States and other countries in
all of its products. The trend toward consolidation in the semiconductor
processing equipment industry has made it increasingly important to have the
financial resources necessary to compete effectively across a broad range of
product offerings, to fund customer service and support on a worldwide basis and
to invest in both product and process research and development. Significant
competitive factors include product performance, price and reliability,
familiarity with particular manufacturers' products, established relationships
between suppliers and customers, particulate contamination control and product
availability. While the Company believes that outside Japan and the Pacific Rim
it competes favorably with respect to most of these factors,* it has
occasionally been subject to intense price competition with respect to
particular orders and has had difficulty establishing new relationships with
certain customers who have long-standing relationships with other suppliers.
 
     Certain of the Company's existing and potential competitors have
substantially greater name recognition, financial, engineering, manufacturing
and marketing resources and customer service and support capabilities than the
Company. In addition, Nikon, and to a lesser extent Canon, have long established
relationships as suppliers of photolithography equipment to most of the
semiconductor manufacturers. Although the Company has supplied Track and Thermco
equipment to many of these customers, it has not previously sold meaningful
quantities of Micrascan photolithography equipment to them. Accordingly, the
recent shipment by Nikon of initial quantities of its .25 micron step and scan
system or announced competitive product introductions by either ASM Lithography,
Canon or some other supplier, may cause customers to delay purchases from the
Company until such new products have been evaluated.
 
     The Company's competitors can be expected to continue to improve the design
and performance of their current products and processes and to introduce new
products and processes with improved price/performance characteristics. There
can be no assurance that the Company will be able to compete effectively in the
future. The Company faces substantial foreign and domestic competition,
including that from Tokyo Electron, Ltd. ("TEL") and DaiNippon Screen Mfg. Co.,
Ltd. in photoresist processing equipment and TEL and Kokusai Electric Co., Ltd.
in oxidation/diffusion and LPCVD equipment. SVGL competes with other suppliers
of photolithography exposure equipment, including manufacturers of steppers and
projection aligners. SVGL's Micralign products are generally not competitive
with steppers for fabrication of semiconductor devices with line widths smaller
than 1.25 micron. In marketing Micrascan systems, SVGL faces competition from
suppliers employing other technologies, principally I-Line and Deep UV steppers,
including Nikon Corp., Canon and ASM Lithography. Certain stepper manufacturers
have utilized techniques, such as the use of off-axis illumination and phase
shift mask technology, to extend the capabilities of steppers beyond their
previously estimated limits. Although the Company believes that its step and
scan system will compete favorably with steppers employing these techniques,*
the status of the development of such techniques is uncertain and the Company
has experienced intense competition from such stepper manufacturers. The Company
also anticipates the introduction of competing photolithography systems which
utilize step and scan technology. Nikon has shipped initial quantities of a .25
micron step and scan photolithography system which utilizes a Deep UV light
source, and ASM Lithography and Canon have announced similar products. Nikon,
and to a lesser extent Canon, have long-established relationships as suppliers
of photolithography equipment to
 
                                       10
<PAGE>   12
 
most of the semiconductor manufacturers. While the Company has supplied Track
and Thermco equipment to many of these customers, it has not previously sold
meaningful quantities of Micrascan photolithography equipment to them.
 
     The Japanese and Pacific Rim markets (including fabrication facilities
operated outside these areas by Japanese and Pacific Rim semiconductor
manufacturers) represent a substantial portion of the overall market for
semiconductor equipment. To date, the Company has not been successful in
securing a significant share of these markets. The Company believes that the
Japanese companies with which it competes have a competitive advantage because
their dominance of the Japanese and Pacific Rim semiconductor equipment market
provides them with the sales and technology base to compete more effectively
throughout the rest of the world. The Company is not engaged in any significant
collaborative effort with any Japanese or Pacific Rim semiconductor
manufacturers. As a result, the Company may be at a competitive disadvantage to
the Japanese equipment suppliers which are engaged in such collaborative efforts
with Japanese and Pacific Rim semiconductor manufacturers. In order to expand
its market share in the Pacific Rim, the Company has begun investing in the
staffing and facilities necessary to sell, service and support customers in the
area through entities in Korea, Singapore and Thailand. There can be no
assurance that the Company will be able to compete successfully in the future in
Japan, the Pacific Rim or elsewhere in the world or that competitive pressures
will not adversely affect the Company's results of operations.
 
     Further, certain of the Company's major customers are involved in joint
ventures and alliances with companies from Japan and Europe. In some cases the
non-U. S. portion of the collaboration is the deciding factor in the selection
of equipment for the joint ventures. In those situations the Company may be at a
competitive disadvantage, which could lead to a loss of market share in those
geographic areas. A decision by any such major customers not to utilize the
Micrascan would have an adverse effect on the Company.
 
MANUFACTURING AND RAW MATERIALS
 
     The Company manufactures its products from standard components and from
components manufactured by others according to the Company's design
specifications. Track products are manufactured in San Jose, California. Thermco
manufactures most of its products in Orange, California and has a limited
manufacturing facility in Billingshurst, West Sussex, England. SVGL
photolithography exposure products are manufactured in Wilton and Ridgefield,
Connecticut.
 
     During fiscal 1996, the Company introduced new products in all three of its
product groups for shipment in fiscal 1997. From time-to-time, the Company has
experienced difficulty in ramping up production or effecting transitions to new
products. There can be no assurance that the Company will not experience
manufacturing problems as a result of capacity constraints or as a result of
upgrading or expanding existing operations in an effort to increase production
capacity. These issues could result in product delivery delays and a subsequent
loss of future sales. The Company believes that protracted delays in delivering
initial quantities of newly developed products to multiple customers could
result in semiconductor manufacturers electing to install competitive equipment
in their fabrication facilities. The inability to produce such products or any
failure to achieve market acceptance could have a material adverse effect on the
Company's business and results of operations.
 
     The Company believes that its ability to supply systems in volume will be a
major factor in customer decisions to commit to SVGL'S Micrascan technology.*
Based upon its forecast of continued high growth for photolithography equipment
and potential future demand for advanced lithography products, the Company has
implemented plans to increase SVGL'S production capacity under an extremely
aggressive expansion schedule. During the first half of fiscal 1996, SVGL
commenced certain facility and capital improvements and, on August 2, 1996, the
Company, for approximately $21,200,000, purchased from The Perkin-Elmer
Corporation a 248,000 square foot facility occupied by SVGL in Wilton,
Connecticut and an additional 201,000 square foot building, which SVGL will also
occupy, in Ridgefield, Connecticut. During fiscal 1997, it is the Company's
intent to invest in significant further capital improvements related to the
buildings purchased and the equipment required to expand the production
capabilities of SVGL.* Successful execution of this expansion will require the
timely construction and equipping of facilities, the recruitment, training and
 
                                       11
<PAGE>   13
 
retention of a high quality workforce, and the achievement of satisfactory
manufacturing results on a scale greater than it has attempted in the past.
There can be no assurance the Company can manage these efforts successfully,
which could result in product delivery delays and a subsequent loss of future
revenues. In particular, the Company believes that protracted delays in
delivering initial quantities of Micrascan products could result in
semiconductor manufacturers electing to install competitive equipment in their
advanced fabrication facilities, which could impede acceptance of the Micrascan
products on an industry-wide basis. In addition, the Company's operating results
could also be adversely affected by the increase in fixed costs and operating
expenses related to increases in production capacity if net sales do not
increase commensurately.
 
     Most raw materials and components not produced by the Company are available
from more than one supplier. However, certain raw materials, components and
subassemblies are obtained from single sources or a limited group of suppliers.
Although the Company seeks to reduce its dependence on these sole and limited
source suppliers and the Company has not experienced significant production
delays due to unavailability or delay in procurement of component parts or raw
materials to date, disruption or termination of certain of these sources could
occur and such disruptions could have at least a temporary adverse effect on the
Company's business and results of operations. Moreover, a prolonged inability to
obtain certain components could have a material adverse effect on the Company's
business and results of operations and could result in damage to customer
relationships.
 
     The raw material for a proprietary component of the optical system for the
Micrascan is available from only one supplier and SVGL's projected demand will
require that supplier to expand its capacity. In exchange for investing the
resources to expand its capacity, the supplier may first require the Company to
enter into a long-term, non-cancelable purchase commitment. Additionally, the
Company's Micrascan III photolithography system utilizes a laser manufactured by
Cymer Laser and not currently available from alternative sources. While the
Company does not currently foresee supply difficulties, Cymer is also supplying
laser light sources for competitors who have introduced or are developing step
and scan deep UV photolithography systems.
 
PATENTS AND LICENSES
 
     The Company owns several domestic and foreign patents relating to the
businesses of Track, Thermco and SVGL. Although the Company has historically
relied and continues to rely on the technical and marketing competence and
creative ability of its personnel, rather than patents, to maintain its
competitive position, it has begun to pursue both domestic and foreign patent
protection more aggressively.
 
     As is typical in the semiconductor equipment industry, the Company has from
time to time received, and may in the future receive, communications from third
parties asserting patents or copyrights on certain of the Company's products and
technologies. At least one of the Company's customers has put the Company on
notice that it has received a notice of infringement from Jerome H. Lemelson,
alleging that equipment used in the manufacture of electronic devices infringes
patents issued to Mr. Lemelson relating to "machine vision" or "barcode reader"
technologies. The customer has put the Company on notice it intends to seek
indemnification from the Company for any damages and expenses resulting from
this matter if found liable or if the customer settles the claim. Although the
Company has not received any recent communications on this subject, it cannot
predict the outcome of this or any similar claim or its effect upon the Company,
and there can be no assurance that any such litigation or claim would not have a
material adverse effect upon the Company's financial condition or results of
operations.
 
ENVIRONMENTAL REGULATION
 
     To date, the Company has not encountered significant issues regarding the
discharge of material into the environment or otherwise relating to the
protection of the environment and therefore has not been required to spend
significant amounts for capital or non-capital expenditures in order to comply
with laws and regulations pertaining thereto.
 
     In August 1996, the Company purchased from The Perkin-Elmer Corporation
("Perkin-Elmer"), approximately 50 acres of land and a 201,000 square foot
building thereon (the "Property"). At the time the Company purchased the
Property, it was aware that certain groundwater and soil contamination was
present
 
                                       12
<PAGE>   14
 
and that the Property was subject to a clean-up order being performed by
Perkin-Elmer under the jurisdiction of the Connecticut Department of
Environmental Protection. Agreements between the Company and Perkin-Elmer
provide that Perkin-Elmer has sole responsibility for all obligations or
liabilities related to the clean-up order. While the Company believes that it
has been adequately indemnified, if for some reason Perkin-Elmer was unable to
comply or did not comply with the clean-up order, the Company could be required
to do so.
 
     The Company does not anticipate any material capital expenditures for
environmental control facilities in 1997.*
 
EMPLOYEES
 
     At September 30, 1996, the Company had 2,875 full-time employees and 197
part-time employees and contract personnel, including 587 in research and
development, 1,357 in manufacturing, 974 in marketing, sales and customer
service and support and 154 in administration. None of the Company's employees
are represented by a union. Management considers its relations with its
employees to be good.
 
     The Company's future success is dependent upon its ability to attract and
retain qualified management, technical, sales and support personnel for its
operations. In particular, SVGL's growth is very dependent on the Company's
ability to attract and retain key skilled employees, particularly those related
to the optical segment of its business. The competition for such personnel is
intense. Some key positions in the Company are held by persons who have only
recently been appointed to such positions. The Company's growth has increased
its dependence on key management personnel. The loss of certain key people, the
failure of key persons to perform in their current positions or the Company's
inability to attract and retain new key employees could materially adversely
affect the Company's performance.
 
EXECUTIVE OFFICERS OF THE REGISTRANT
 
     The executive officers of the Company are as follows:
 
<TABLE>
<CAPTION>
                     NAME                    AGE
    ---------------------------------------  ---
    <S>                                      <C>   <C>
    Papken S. Der Torossian................   57   Chairman of the Board and Chief
                                                   Executive Officer
    Russell G. Weinstock...................   53   Vice President, Finance and Chief
                                                   Financial Officer
    Edward A. Dohring......................   63   Vice President, President, SVG
                                                   Lithography Systems, Inc.
    Steven L. Jensen.......................   47   Vice President, Worldwide Sales and
                                                   Service
    Jeffrey M. Kowalski....................   43   Vice President, President, Thermco
                                                   Systems Division
    Boris Lipkin...........................   49   Vice President, Corporate
    John W. Mathews........................   48   Vice President, Worldwide Service
    Robert J. Richardson...................   50   Vice President, New Business
                                                   Development and Corporate Marketing
    Edmond R. Ward.........................   56   Vice President, Corporate Technology
    Larry W. Sonsini.......................   55   Secretary
</TABLE>
 
     Mr. Der Torossian became Chairman of the Board and Chief Executive Officer
in July 1991. From February 1986 to July 1991 he was President and Chief
Executive Officer, and has been a director of the Company since October 1984.
 
     Mr. Weinstock has been Vice President of Finance and Chief Financial
Officer of the Company and Vice President of Finance and Chief Financial Officer
of SVGL since July 1990. From April 1985 to July 1990, he was Corporate
Controller and was promoted to Vice President in February 1990.
 
     Mr. Dohring became a Vice President of the Company in July 1992. He became
President of SVG Lithography Systems, Inc. in October 1994. From June 1992 to
October 1994, he was President of Track.
 
                                       13
<PAGE>   15
 
From April 1989 to June 1992, he was President of Rochester Instrument Systems,
Inc., a manufacturer of measurement instruments for utilities and the
semiconductor industry.
 
     Mr. Jensen became a Vice President of the Company in July 1992 and Vice
President, Worldwide Sales in April 1992. From April 1991 to April 1992 he was
Vice President, Marketing for Genus, Inc., a manufacturer of semiconductor
equipment. From October 1990 to April 1991, Mr. Jensen was a Senior Vice
President of Sales and Marketing for the Athens Corporation, a manufacturer of
chemical reprocessing systems.
 
     Mr. Kowalski became a Vice President of the Company and President of
Thermco in January 1995. From November 1992 to January 1995 he was the Vice
President of Marketing of Thermco, as well as its Vice President of Technology
from November 1993. Mr. Kowalski joined the Company in 1987 and prior to
November 1992 held various management positions in its engineering organization.
 
     Mr. Lipkin became a Vice President of the Company in March 1995. From
August 1992 to March 1995 he was the Vice President and General Manager of the
Thin Film Systems business unit of Varian Associates. From 1978 to August 1992,
Mr. Lipkin served in various management and engineering positions with
International Business Machines.
 
     Mr. Mathews joined the Company in September 1993 and became a Vice
President in October 1993. From November 1994 he has been Vice President,
Worldwide Service. From September 1993 to November 1994 he was Vice President,
Corporate Operations. From October 1992 to September 1993, Mr. Mathews was Vice
President and General Manager of Acume Technologies, Inc. From November 1979 to
October 1992 Mr. Mathews held various positions with KLA Instruments Corporation
including Vice President and General Manager of its Technology Division from
November 1989 to October 1992.
 
     Mr. Richardson became a Vice President of the Company in July 1992. He
became Vice President, New Business Development and Corporate Marketing in March
1996. From October 1994 to March 1996 Mr. Richardson was Vice President,
Corporate Marketing and President of Track. From June 1992 to October 1994 he
was President of SVG Lithography Systems, Inc. From October 1988 to June 1992,
he was President and General Manager of the Santa Cruz Division of Plantronics,
Inc.
 
     Mr. Ward became a Vice President of the Company in July 1992, President of
Thermco in April 1992 and Vice President, Corporate Technology in October 1993.
From June 1990 to April 1992, he was Director of Thin Film Manufacturing for
Alcoa Electronics Packaging, a division of Alcoa Corporation.
 
     Mr. Sonsini has been Secretary since November 1988. He has been a member of
the Board of Directors of the Company since 1991. Mr. Sonsini is a member of the
law firm of Wilson Sonsini Goodrich & Rosati, P.C., counsel to the Company, and
is the Chairman of the firm's Executive Committee. Mr. Sonsini serves on the
boards of directors of Lattice Semiconductor Corporation, Novell, Inc., PIXAR,
and Pure Atria Corporation.
 
ITEM 2.  PROPERTIES.
 
     The Company's corporate headquarters are located in San Jose, California in
36,000 square feet of office space. This space is under a lease that expires in
2006 and has a current base rental of approximately $60,000 per month.
 
     The Company's Track Systems Division has two leased facilities in San Jose,
California. The first is a 90,000 square foot, two-story building with a current
monthly base rental of approximately $90,000 and a lease expiration of 2004. The
second is also a two-story building consisting of approximately 83,000 square
feet. The monthly base rental for this facility is approximately $79,000 under a
lease expiring in 1998.
 
     In March 1996, the Company purchased approximately nine acres of land
adjacent to one of the Track facilities in San Jose, California. Although the
Company currently has no plans to develop the parcel, it provides the
flexibility for future expansion of the Company's Track operations and its
thermal processing lab.
 
                                       14
<PAGE>   16
 
     The Thermco Systems Division has two facilities in Orange, California. The
first facility consists of approximately 92,000 square feet with a base monthly
rent expense of approximately $49,000 under a lease expiring in 1999. The second
facility consists of approximately 77,000 square feet with a base monthly rental
expense of approximately $43,500 under a lease expiring in 1999.
 
     SVGL owns two facilities in Fairfield County, Connecticut. The first
consists of approximately 29 acres of land and buildings totaling approximately
248,000 square feet, located in Wilton, Connecticut. The second consists of
approximately 50 acres of land and a 201,000 square foot building located in
Ridgefield, Connecticut.
 
     The Company also leases storage and warehouse space near its headquarters
in San Jose, office space near its Thermco facilities in Orange, sales and
service offices in key locations throughout the United States, Western Europe
and the Pacific Basin, and space for a limited manufacturing operation in the
United Kingdom.
 
ITEM 3.  LEGAL PROCEEDINGS.
 
     The Company, from time to time, is party to various legal actions arising
out of the normal course of business, none of which is expected to have a
material effect on the Company's financial position or operating results.
 
ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
 
     No matter was submitted to a vote of the Company's security holders during
the fiscal quarter ended September 30, 1996.
 
                                       15
<PAGE>   17
 
                                    PART II
 
ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.
 
     The information required by this Item is set forth in Registrant's Annual
Report to Stockholders for the fiscal year ended September 30, 1996, at page 28
under the caption "Common Stock Prices", which information is incorporated
herein by reference.
 
ITEM 6.  SELECTED FINANCIAL DATA.
 
     The information required by this Item is set forth in Registrant's Annual
Report to Stockholders for the fiscal year ended September 30, 1996, at page 28
under the caption "Five-Year Selected Financial Data", which information is
incorporated herein by reference.
 
ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS.
 
     The information required by this Item is set forth in Registrant's Annual
Report to Stockholders for the fiscal year ended September 30, 1996, at pages 29
to 36 under the caption "Management's Discussion and Analysis of Financial
Condition and Results of Operations", which information is incorporated herein
by reference.
 
ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
 
     The information required by this Item is set forth in Registrant's Annual
Report to Stockholders for the fiscal year ended September 30, 1996, at pages 12
to 27, which information is incorporated herein by reference.
 
     The Company observes a 52-53 week fiscal year ending on the Friday closest
to September 30. Under this practice, the Company's last three fiscal years
ended September 30, 1994, September 29, 1995, and September 27, 1996. For
convenience, this Report and the Company's Consolidated Financial Statements
refer to all such fiscal years as ending at September 30. Fiscal 1994, 1995, and
1996 each included 52 weeks.
 
ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS.
 
     Not applicable.
 
---------------
     With the exception of the information expressly incorporated by reference
from the Annual Report to Stockholders into Parts II and IV of this Form 10-K,
the Company's Annual Report to Stockholders is not to be deemed filed as part of
this report.
 
                                       16
<PAGE>   18
 
                                    PART III
 
     Certain information required by Part III is omitted from this Report in
that the Registrant will file its definitive Proxy Statement for the Annual
Meeting of Stockholders to be held on February 20, 1997, pursuant to Regulation
14A of the Securities Exchange Act of 1934 (the "Proxy Statement"), not later
than 120 days after the end of the fiscal year covered by this Report, and
certain information included in the Proxy Statement is incorporated herein by
reference.
 
ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.
 
     (a) Executive Officers.  See the section entitled "Executive Officers of
the Registrant" in Part I, Item 1.
 
     (b) Directors.  The information required by this Item is incorporated by
reference to the section entitled "Election of Directors" in the Proxy
Statement.
 
ITEM 11.  EXECUTIVE COMPENSATION.
 
     The information required by this Item is incorporated by reference to the
section entitled "Executive Compensation" in the Proxy Statement.
 
ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
 
     The information required by this Item is incorporated by reference to the
section entitled "Stock Ownership of Certain Beneficial Owners and Management"
in the Proxy Statement.
 
ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
 
     The information required by this Item is incorporated by reference to the
section entitled "Certain Transactions" in the Proxy Statement.
 
                                       17
<PAGE>   19
 
                                    PART IV
 
ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULE AND REPORTS ON FORM 8-K.
 
     (a) 1. FINANCIAL STATEMENTS.
 
     The following consolidated financial statements of the Company included in
the Company's Annual Report to Stockholders for the fiscal year ended September
30, 1996, are incorporated by reference:
 
        Independent Auditors' Report.
 
        Consolidated Balance Sheets at September 30, 1996 and 1995.
 
        Consolidated Statements of Income for the Years Ended September 30,
        1996, 1995 and 1994.
 
        Consolidated Statements of Stockholders' Equity for the Years Ended
        September 30, 1996, 1995 and 1994.
 
        Consolidated Statements of Cash Flows for the Years Ended September 30,
        1996, 1995 and 1994.
 
        Notes to Consolidated Financial Statements.
 
     2. SUPPLEMENTAL SCHEDULE.
 
        Independent Auditors' Report.
 
        Schedule II -- Valuation and Qualifying Accounts.
 
     Financial Statement Schedules, other than the schedule listed above, have
been omitted because the required information is contained in the Consolidated
Financial Statements and the Notes thereto, or because such schedules are not
required or applicable.
 
                                       18
<PAGE>   20
 
     3. EXHIBITS.
 
<TABLE>
<CAPTION>
   EXHIBIT
   NUMBER
-------------
<C>             <S>
  3.1(1)        Certificate of Incorporation, as amended to date.
  3.2(11)       Bylaws.
  3.3(10)       Certificate of Designation of Series A Convertible, Redeemable Preferred
                Stock of Silicon Valley Group, Inc. dated July 31, 1992.
  4.1(1)        Article IV of the Certificate of Incorporation of the Registrant.
 10.1(2)        Lease Agreement, dated January 31, 1990, between Registrant and Orchard
                Investment Company Number 703 for premises located at 541 East Trimble Road,
                San Jose, California.
 10.2(3)        Lease Agreement, dated February 7, 1985, between Thermco Systems, Inc. and
                The Klokke Corporation, for premises located at 1482 N. Batavia Street,
                Orange, California.
 10.3(2)        Amendment to Lease Agreement, dated November 14, 1989 between Thermco
                Systems, Inc. and The Klokke Corporation for premises located at 1482 N.
                Batavia Street, Orange, California.
 10.4(4)        Lease Agreement, dated December 21, 1984, between Anicon, Inc. and Holvick de
                Regt Koering for premises located at 2240 Ringwood Avenue, San Jose,
                California.
 10.5(4)        Amendment to Lease Agreement, dated January 31, 1987, between Anicon, Inc.
                and ARSJ Properties for premises located at 2240 Ringwood Avenue, San Jose,
                California.
 10.6(2)        Fourth Amendment to Lease Agreement dated March 23, 1990 between Thermco
                Systems, Inc. and ARSJ Properties for premises located at 2240 Ringwood
                Avenue, San Jose, California.
 10.7(3)        Lease Agreement, dated July 1, 1985, between Thermco Systems, Inc. and LST
                Investments, for premises located at 1465 N. Batavia Street, Orange,
                California.
 10.8(2)        Amendment to Lease Agreement dated February 1, 1990, between Thermco Systems,
                Inc. and LST Investments for premises located at 1465 N. Batavia Street,
                Orange, California.
 10.10(5)**     1982 Employee Stock Option Plan.
 10.11(5)**     1984 Stock Option Plan.
 10.12(5)**     1987 Stock Option Plan.
 10.13(5)**     Employee Stock Purchase Plan.
 10.14(12)**    Employment Agreement between Registrant and Papken Der Torossian, dated
                August 1, 1994.
 10.15(12)**    Employment Agreement between Registrant and Russell G. Weinstock, dated
                October 3, 1994.
 10.16(6)**     Silicon Valley Group, Inc. Cash or Deferred Profit Sharing Plan and Trust.
 10.17(4)       Letter Agreement, dated January 30, 1987, between Morgan Stanley Research
                Ventures and Registrant relating to epitaxial products.
 10.18(4)       Form of Indemnification Agreement.
 10.19(4)**     Standard form Stock Option Agreements.
 10.20(7)       Lease Agreement, dated December 21, 1987, between Registrant and D.J. and
                Virginia L. Brown dba Orchard Investment Company No. 306 for premises located
                at 2065 Junction Avenue, San Jose, California, and Supplemental Agreement
                thereto dated January 19, 1988.
 10.21(7)**     Forms of Option Acceleration Agreement.
</TABLE>
 
                                       19
<PAGE>   21
 
<TABLE>
<CAPTION>
   EXHIBIT
   NUMBER
-------------
<S>             <C>
 10.22(7)       Purchase Agreement, dated November 9, 1988, between Registrant, Anicon, Inc.,
                SVG Europe, Ltd., SVG Halbleiter Anlagen GmbH, and SVG International Service,
                Inc.; and Sunbeam Holdings, Inc., Sunbeam Electric (Holdings) Ltd., Thermco
                Systems, Inc., and Gryphon Products, Inc.
*10.23(8)       Development Agreement between IBM and SVGL dated May 15, 1990.
*10.24(8)       Agreement dated as of May 15, 1990 between International Business Machines
                Corporation ("IBM") and SVGL relating to the purchase and sale of Micrascan
                Systems, as modified by IBM and SVGL on June 18, 1992 and June 19, 1992.
*10.25(8)       Development Agreement between SEMATECH, Inc. and SVGL dated May 15, 1990.
*10.26(8)       Chemical Supply and Technology Transfer Agreement between IBM and SVGL dated
                as of June 11, 1990.
*10.27(8)       Stockholders' Agreement dated May 15, 1990 among Registrant, SVGL, IBM and
                The Perkin-Elmer Corporation ("Perkin-Elmer").
*10.28(9)       Asset Transfer and Common Stock Purchase Agreement dated as of May 15, 1990
                among Registrant, IBM, Perkin-Elmer and SVGL.
 10.29(8)       Lease Agreement dated May 15, 1990 between SVGL and Perkin-Elmer for premises
                located at 77 Danbury Road, Wilton, Connecticut.
 10.30(10)      Series AA Convertible, Redeemable Preferred Stock Purchase Agreement dated
                July 31, 1992 between the Company and The Perkin-Elmer Corporation.
 10.31(12)      Credit Agreement by and among Registrant, SVG Lithography Systems, Inc.,
                certain banks named therein and ABN AMRO Bank, N.V., as agent, dated October
                7, 1994.
*10.32(12)      Development Agreement between SEMATECH, Inc., Registrant and SVG Lithography
                Systems, Inc. dated September 30, 1994.
 10.33(12)      Warrants to Purchase Common Stock of Registrant issued to SEMATECH, Inc.,
                dated as of September 30, 1994.
*10.34(12)      Development Agreement between SEMATECH, Inc., Registrant and SVG Lithography
                Systems, Inc. dated as of October 24, 1994.
*10.35(12)      Development Agreement between SEMATECH, Inc., Registrant and SVG Lithography
                Systems, Inc. dated as of October 24, 1994.
*10.36(12)      Development Agreement between SEMATECH, Inc., Registrant and SVG Lithography
                Systems, Inc. dated as of December 22, 1994.
*10.37(12)      Development Agreement between SEMATECH, Inc., Registrant and SVG Lithography
                Systems, Inc. dated as of December 22, 1994.
 10.38(13)      Business Agreement dated as of February 21, 1995, among the Company, SVG
                Lithography Systems, Inc., Intel Corporation, Motorola Inc. and Texas
                Instruments Incorporated.
 10.39(13)      Series B Convertible Redeemable Preferred Stock Purchase Agreement dated as
                of February 21, 1995, among the Company, Intel Corporation, Motorola, Inc.
                and Texas Instruments Incorporated.
 10.40(13)      Registration Rights Agreement dated as of February 21, 1995, among the
                Company, Intel Corporation, Motorola Inc. and Texas Instruments Incorporated.
 10.41          Credit Agreement dated as of December 7, 1995 among Silicon Valley Group,
                Inc., SVG Lithography Systems, Inc. and the Banks named therein and ABN AMRO
                Bank, N.V., as Agent.
</TABLE>
 
                                       20
<PAGE>   22
<TABLE>
<CAPTION>
 EXHIBIT
 NUMBER 
---------- 
<S>             <C>
 13.1           Selected data from Annual Report to Stockholders for fiscal year
                ended September 30, 1996.
 21.1           Registrant's wholly-owned subsidiaries are (i) Silicon Valley
                Group, K.K., a Japanese corporation, (ii) SVG International
                Service, a California corporation ("SVG International"), (iii)
                Silicon Valley Group FSC Incorporated, a Barbados corporation,
                (iv) SVG Israel, Inc., a Delaware corporation and (v) SVG
                Thailand, Inc., a Delaware corporation. SVG Europe Limited, a
                United Kingdom corporation ("SVG Europe"), SVG France, S.A.R.L.,
                a French corporation, Silicon Valley Group Deutschland GmbH, a
                German corporation, SVG Systems (Asia) Pte. Ltd., a Singapore
                corporation and Thermco Systems (Far East) Limited, a Hong Kong
                corporation are wholly-owned by SVG International. UK Systems
                Limited, an English corporation, is wholly-owned by SVG Europe.
                The Registrant owns 94% of SVG Lithography Systems, Inc., a
                Delaware corporation ("SVGL"). SVGL's wholly-owned subsidiaries
                are (i) SVG Lithography Japan Co., Ltd., a Japanese Corporation,
                (ii) SVG Lithography (Europe) B.V., a Netherlands Corporation,
                (iii) SVG Lithography Systems Korea, Inc., a Delaware
                corporation, (iv) SVG France S.A.R.L., a French corporation, and
                (v) SVG Lithography Systems FSC, Inc., a Barbados corporation.
 23.1           Consent of Deloitte & Touche LLP, independent auditors.
 24.1           Power of Attorney (see page 39). 
 27             Financial Data Schedule. 
</TABLE>
 
---------------
 *  Confidential treatment granted as to a portion of this exhibit.
 
**  Management contract or compensatory plan or arrangement required to be filed
    as an exhibit to this Form 10-K pursuant to Item 14(c) of this report.
 
(1) Incorporated by reference to Registrant's Annual Report on Form 10-K for
    fiscal year ended September 30, 1988.
 
(2) Incorporated by reference to Registrant's Annual Report on Form 10-K for
    fiscal year ended September 30, 1990.
 
(3) Incorporated by reference to Registrant's Annual Report on Form 10-K for
    fiscal year ended September 30, 1989.
 
(4) Incorporated by reference to Registrant's Annual Report on Form 10-K for
    fiscal year ended September 30, 1987.
 
(5) Incorporated by reference to Registrant's registration statement filed under
    the Securities Act of 1933 on Form S-8 and Form S-3, file no. 33-31298.
 
(6) Incorporated by references to Registrant's quarterly report on Form 10-K for
    the fiscal year ended September 30, 1986.
 
(7) Incorporated by reference to Registrant's Annual Report on Form 10-K for
    fiscal year ended September 30, 1988.
 
(8) Incorporated by reference to Registrant's quarterly report on Form 10-Q
    dated June 30, 1990.
 
(9) Incorporated by reference to Registrant's report on Form 8-K dated May 15,
    1990.
 
(10) Incorporated by reference to Registrant's quarterly report on Form 10-Q for
     the quarter ended June 30, 1992.
 
(11) Incorporated by reference to Registrant's Annual Report on Form 10-K for
     fiscal year ended September 30, 1993.
 
                                       21
<PAGE>   23
 
(12) Incorporated by reference to Registrant's Annual Report on Form 10-K for
     fiscal year ended September 30, 1994.
 
(13) Incorporated by reference to Registrant's quarterly report on Form 10-Q for
     the quarter ended March 31, 1995.
     (b) REPORTS ON FORM 8-K. None
     (c) EXHIBITS. See (a) above.
     (d) FINANCIAL STATEMENT SCHEDULES. See (a) above.
 
                                       22
<PAGE>   24
 
                          INDEPENDENT AUDITORS' REPORT
 
To the Board of Directors and Stockholders of
Silicon Valley Group, Inc.
San Jose, California
 
     We have audited the consolidated financial statements of Silicon Valley
Group, Inc. as of September 30, 1996 and 1995, and for each of the three years
in the period ended September 30, 1996, and have issued our report thereon dated
October 24, 1996; such consolidated financial statements and report are included
in your 1996 Annual Report to Stockholders and are incorporated herein by
reference. Our audits also included the financial statement schedule of Silicon
Valley Group, Inc., listed in Item 14(a)2. This financial statement schedule is
the responsibility of the Company's management. Our responsibility is to express
an opinion based on our audits. In our opinion, such financial statement
schedule, when considered in relation to the basic consolidated financial
statements taken as a whole, presents fairly in all material respects the
information set forth therein.
 
DELOITTE & TOUCHE LLP
 
San Jose, California
October 24, 1996
 
                                       23
<PAGE>   25
 
                                   SIGNATURES
 
     Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
 
                                          SILICON VALLEY GROUP, INC.
 
December 26, 1996
 
                                          By: /s/  Papken S. Der Torossian
 
                                            ------------------------------------
                                            Papken S. Der Torossian,
                                            Chairman of the Board and
                                            Chief Executive Officer
 
                               POWER OF ATTORNEY
 
     KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Papken S. Der Torossian and Russell G.
Weinstock, and each of them, as his true and lawful attorneys-in-fact and
agents, with full power of substitution and resubstitution, for him and in his
name, place and stead, in any and all capacities, to sign any and all amendments
to this report on Form 10-K, and to file the same, with all exhibits thereto,
and other documents in connection therewith, with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents, and each of them,
full power and authority to do and perform each and every act and thing
requisite and necessary to be done in connection therewith and about the
premises, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all that said attorneys-in-fact and
agents, or any of them, or their or his substitute or substitutes, may lawfully
do or cause to be done by virtue hereof.
 
     Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been duly signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.
 
<TABLE>
<CAPTION>
              SIGNATURE                               TITLE                        DATE
-------------------------------------      ---------------------------      ------------------
<S>                                        <C>                              <C>
    /s/  PAPKEN S. DER TOROSSIAN             Chairman of the Board,         December 26, 1996
-------------------------------------      Chief Executive Officer and
       Papken S. Der Torossian                 Director (Principal
                                               Executive Officer)
      /s/  RUSSELL G. WEINSTOCK            Vice President, Finance and      December 26, 1996
-------------------------------------        Chief Financial Officer
        Russell G. Weinstock                (Principal Financial and
                                               Accounting Officer)
      /s/  WILLIAM A. HIGHTOWER                     Director                December 26, 1996
-------------------------------------
        William A. Hightower
       /s/  WILLIAM L. MARTIN                       Director                December 26, 1996
-------------------------------------
          William L. Martin
           /s/  NAM P. SUH                          Director                December 26, 1996
-------------------------------------
             Nam P. Suh
       /s/  LAWRENCE TOMLINSON                      Director                December 26, 1996
-------------------------------------
         Lawrence Tomlinson
        /s/  LARRY W. SONSINI                Secretary and Director         December 26, 1996
-------------------------------------
          Larry W. Sonsini
</TABLE>
 
                                       24
<PAGE>   26
 
                           SILICON VALLEY GROUP, INC.
 
                SCHEDULE II -- VALUATION AND QUALIFYING ACCOUNTS
                                 (IN THOUSANDS)
 
<TABLE>
<CAPTION>
                                            BALANCE AT    CHARGED TO                               BALANCE
                                            BEGINNING     COSTS AND                                AT END
               DESCRIPTION                  OF PERIOD      EXPENSES     OTHER    DEDUCTIONS(1)    OF PERIOD
------------------------------------------  ----------    ----------    -----    -------------    ---------
<S>                                         <C>           <C>           <C>      <C>              <C>
YEAR ENDED 9/30/94:
  Allowance for Doubtful Accounts.........   $  1,401      $  1,528      $--       $    (299)      $  2,630
  Product Warranty Reserves...............     14,986        18,663       --         (15,324)        18,325
YEAR ENDED 9/30/95:
  Allowance for Doubtful Accounts.........      2,630         2,026       --            (549)         4,107
  Product Warranty Reserves...............     18,325        35,830       --         (21,552)        32,603
YEAR ENDED 9/30/96:
  Allowance for Doubtful Accounts.........      4,107         2,018       --            (122)         6,003
  Product Warranty Reserves...............     32,603        64,068       --         (53,772)        42,899
</TABLE>
 
---------------
(1) Write-offs of uncollectible accounts and costs incurred for warranty
    repairs.
<PAGE>   27
 
                                 EXHIBIT INDEX
 
<TABLE>
<CAPTION>
EXHIBIT NO.                                        EXHIBIT
-----------   ----------------------------------------------------------------------------------
<S>           <C>
    13.1      Selected data from Annual Report to Stockholders for fiscal year ended September
              30, 1996.
    23.1      Consent of Deloitte & Touche, independent auditors.
    27        Financial Data Schedule.
</TABLE>
<PAGE>   28
 
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