<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MARCH 16, 1995
REGISTRATION NO. 33-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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SILICON VALLEY GROUP, INC.
(EXACT NAME OF ISSUER AS SPECIFIED IN ITS CHARTER)
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<TABLE>
<S> <C>
DELAWARE 94-2264681
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(STATE OF INCORPORATION) (I.R.S. EMPLOYER
IDENTIFICATION NUMBER)
</TABLE>
2240 RINGWOOD AVENUE
SAN JOSE, CALIFORNIA 95131
(408) 434-0500
(ADDRESS, INCLUDING ZIP CODE AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
------------------------
PAPKEN S. DER TOROSSIAN
CHAIRMAN OF THE BOARD AND CHIEF
EXECUTIVE OFFICER
SILICON VALLEY GROUP, INC.
2240 RINGWOOD AVENUE
SAN JOSE, CALIFORNIA 95131
(408) 434-0500
(NAME, ADDRESS, INCLUDING ZIP CODE AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
AGENT FOR SERVICE)
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COPY TO:
ROBERT T. CLARKSON
WILSON, SONSINI, GOODRICH & ROSATI
PROFESSIONAL CORPORATION
650 PAGE MILL ROAD
PALO ALTO, CALIFORNIA 94304
(415) 493-9300
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC UNDER THIS
REGISTRATION STATEMENT: As soon as practicable after this Registration Statement
becomes effective.
If the only securities being registered on this Form are to be offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. /X/
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CALCULATION OF REGISTRATION FEE
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<S> <C> <C> <C> <C>
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PROPOSED
PROPOSED MAXIMUM
AMOUNT MAXIMUM AGGREGATE
TITLE OF SECURITIES TO BE OFFERING PRICE OFFERING AMOUNT OF
TO BE REGISTERED REGISTERED PER SHARE(1) PRICE(1) REGISTRATION FEE
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Common Stock $0.01 par value........... 1,494,300 shares $25.31 $37,820,733 $13,042.00
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(1) Estimated solely for purposes of calculation of the registration fee based
on the average of the high and low prices of the Registrant's Common Stock
on the Nasdaq National Market on March 13, 1995.
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THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
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<PAGE> 2
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH
THE SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD
NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION
STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER
TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES IN ANY STATE IN
WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO
REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
SUBJECT TO COMPLETION DATED MARCH 16, 1995
PROSPECTUS
1,494,300 SHARES
SILICON VALLEY GROUP, INC.
------------------------
COMMON STOCK
($.01 PAR VALUE)
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This Prospectus relates to the public offering, which is not being
underwritten, of shares of the common stock ("Common Stock") of Silicon Valley
Group, Inc. (together with its consolidated subsidiaries, "Silicon Valley Group"
or the "Company") offered from time to time by any or all of the Selling
Stockholders named herein (the "Selling Stockholders") who will receive such
shares upon conversion of all Series B Convertible Redeemable Preferred Stock of
Silicon Valley Group which will automatically convert into 1,494,300 shares of
Common Stock upon the closing of an offering made pursuant to a Registration
Statement on Form S-3 filed with the Securities and Exchange Commission on March
2, 1995. Such shares were issued pursuant to an exemption from the registration
requirements of the Securities Act of 1933, as amended, provided by Section 4(2)
thereof. It is anticipated that the Selling Stockholders will generally offer
shares of Common Stock for sale at prevailing prices in the over-the-counter
market on the date of sale and in certain other ways as described in "Plan of
Distribution." The Company will receive no part of the proceeds of sales made
hereunder. All expenses of registration incurred in connection with this
offering are being borne by the Company, but all selling and other expenses
incurred by Selling Stockholders will be borne by such Selling Stockholders.
None of the shares offered pursuant to this Prospectus have been registered
prior to the filing of the Registration Statement of which this Prospectus is a
part.
The Common Stock of the Company is traded in the over-the-counter market on
the Nasdaq National Market. On March 13, 1995, the closing price of the
Company's Common Stock, as reported in The Wall Street Journal, was $25.50
(Nasdaq Symbol: SVGI).
SEE "RISK FACTORS" FOR A DISCUSSION OF CERTAIN FACTORS THAT SHOULD BE
CONSIDERED BY PROSPECTIVE PURCHASERS OF THE COMMON STOCK OFFERED HEREBY.
Each Selling Stockholder and any broker executing selling orders on behalf
of the Selling Stockholders may be deemed to be an "underwriter" within the
meaning of the Securities Act of 1933, as amended (the "Securities Act").
Commissions received by any such broker may be deemed to be underwriting
commissions under the Securities Act.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
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The date of this Prospectus is March , 1995.
<PAGE> 3
No person is authorized to give any information or to make any
representations, other than those contained in this Prospectus, in connection
with the offering described herein, and, if given or made, such information or
representations must not be relied upon as having been authorized by the Company
or any Selling Stockholder. This Prospectus does not constitute an offer to
sell, or a solicitation of an offer to buy, nor shall there be any sale of these
securities by any person in any jurisdiction in which it is unlawful for such
person to make such offer, solicitation or sale. Neither the delivery of this
Prospectus nor any sale made hereunder shall under any circumstances create an
implication that the information contained herein is correct as of any time
subsequent to the date hereof.
The Company hereby undertakes to provide without charge to each person to
whom a copy of this Prospectus is delivered, upon written or oral request of any
such person, a copy of any and all of the information that has been or may be
incorporated by reference in this Prospectus, other than exhibits to such
documents. Requests for such copies should be directed to the Company's Vice
President, Finance and Chief Financial Officer at 2240 Ringwood Avenue, San
Jose, California 95131. The Company's telephone number at that location is (408)
434-0500.
The Company is subject to the informational reporting requirements of the
Securities Exchange Act of 1934, as amended, and in accordance therewith files
reports, proxy statements and other information with the Securities and Exchange
Commission (the "Commission"). Such reports, proxy statements and other
information can be inspected and copied at the Public Reference Room of the
Commission, 450 Fifth Street, N.W., Washington, D.C. 20549 and at the
Commission's regional offices at 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661-2511; and copies of such material can be obtained from the Public
Reference Section of the Commission, Washington, D.C. 20549, at prescribed
rates. Information, as of particular dates, concerning directors and officers of
the Company, their remuneration, options granted to them, the principal holders
of securities of the Company, and any material interest of such persons in
transactions with the Company has been or will be disclosed in the proxy
statements to be distributed to stockholders of the Company and filed with the
Commission.
This Prospectus contains information concerning the Company and sales of
its Common Stock by the Selling Stockholders but does not contain all the
information set forth in the Registration Statement on Form S-3 which the
Company has filed with the Securities and Exchange Commission under the
Securities Act of 1933, as amended (the "Registration Statement"). The
Registration Statement, including various exhibits, may be inspected at the
Commission's office in Washington, D.C.
RISK FACTORS
In addition to reviewing the Company's Annual Report on Form 10-K for 1994,
the other documents incorporated herein by reference and the other information
in this prospectus, the following factors should be considered carefully in
evaluating the Company and its business before purchasing the Common Stock
offered hereby:
Prospective purchasers of Shares offered hereby should carefully
consider the following risk factors in addition to the other information
presented in this Prospectus.
Cyclical Nature of the Semiconductor Industry. The semiconductor industry
into which the Company sells its products is highly cyclical and has
historically experienced periodic downturns, which often have had a severe
effect on the semiconductor industry's demand for semiconductor processing
equipment. Prior semiconductor industry downturns have resulted in significant
reductions in the Company's net sales, gross margin and net income. For example,
due in part to weakness in the semiconductor market, demand for the Company's
semiconductor processing equipment declined during fiscal 1992 and the Company
was not profitable for the year. While the Company has been profitable for the
past 12 quarters, there is no assurance that the Company will be able to
maintain profitability. Moreover, the Company's operations as a whole will
continue to be dependent on the capital expenditures of semiconductor
manufacturers, which in turn will be largely dependent on the current and
anticipated market demand for integrated circuits and products utilizing
2
<PAGE> 4
integrated circuits. Any future weakness in demand in the semiconductor industry
is likely to have a material adverse effect on the Company's business and
results of operations.
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 inability of traditional I-Line stepper 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 SVG
Lithography Systems, Inc. ("SVGL") in May 1990. From fiscal 1990 to fiscal 1993,
SVGL sold an aggregate of 26 Micrascan systems, 20 of which were sold to IBM, a
minority shareholder in SVGL, and three of which were sold to SEMATECH, Inc.
("SEMATECH"). In fiscal 1994 through the first quarter of fiscal 1995, SVGL
shipped seven systems to five customers, only one of which was shipped in the
first quarter of fiscal 1995. At December 31, 1994, SVGL had a backlog of 20
Micrascan units for shipment to five global semiconductor manufacturers. 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. The Company believes that, as a
consequence, many manufacturers of complex devices are likely to continue 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, however, that these larger and more
complex devices will not be produced in volume until 1996 or 1997. It is
possible that the demand for these larger and more complex devices, and the
fabrication equipment to manufacture them, may never develop or may develop even
later than 1997. The Company believes semiconductor manufacturers will not
require production equipment as advanced as Micrascan until at least 1996, and
that substantial sales of the Company's Micrascan systems will not begin until
late 1996 or 1997, if at all. Stepper manufacturers have enhanced their machines
in the past, and in the future may further enhance their machines to achieve
finer line widths, sufficiently to erode Micrascan's expected yield and
throughput advantages. If this occurs, demand for Micrascan systems may not
develop as the Company expects. SVGL was not profitable in fiscal 1994 nor the
first quarter of fiscal 1995 and there can be no assurance that it will be able
to operate profitably in the future. Failure of SVGL to achieve substantial
sales of Micrascan systems or a delay in achieving such sales could have a
material adverse effect on the Company's ability to continue to operate
profitably.
Fluctuations in Quarterly Operating Results. The Company has historically
experienced substantial quarterly fluctuations in its operating results. Due to
the relatively small number of systems sold during each fiscal quarter and the
relatively high revenues per system, production or shipping delays or customer
order rescheduling can significantly affect quarterly revenues and
profitability. The Company has experienced and may again experience quarters
during which a substantial portion of the Company's net sales are realized near
the end of the quarter. Accordingly, delays in shipments near the end of a
quarter can cause quarterly net sales to fall significantly short of anticipated
levels. Since most of the Company's expenses are fixed in the short term, such
shortfalls in net sales could have a material adverse effect on the Company's
business and results of operations. The Company's operating results may also
vary from quarter to quarter based upon numerous factors including the timing of
new product introductions, product mix, levels of sales, proportions of domestic
and international sales, activities of competitors, acquisitions, international
events and problems in obtaining adequate materials or components on a timely
basis. Historically, gross margins in the Thermco and SVGL businesses have been
lower than in the Track business. To the extent sales of Micrascan products, and
to a lesser extent Thermco products, increase as a percentage of total net
sales, the Company's overall gross margins may be unfavorably impacted. In light
of these factors and the cyclical nature of the semiconductor industry, the
Company expects to continue to experience variability in quarterly operating
results.
3
<PAGE> 5
Need to Increase Manufacturing Capacity. The Company is currently
expanding its manufacturing capacity to meet current and expected demand levels.
From time to time, the Company has experienced difficulty in ramping up
production or effecting transitions to new products and, consequently, has
suffered delays in product deliveries. There can be no assurance that the
Company will not experience manufacturing problems as a result of capacity
constraints or ramping up production by upgrading or expanding existing
operations. This could result in product delivery delays and a subsequent loss
of future revenues. In particular, the Company believes that protracted delays
in delivering 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. 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.
Dependence on New Products and Processes; Importance of Timely Product
Introductions and Enhancements. Semiconductor manufacturing equipment and
processes are subject to rapid technological change. The Company believes that
its future success will depend in part upon its ability to continue to enhance
its existing products and their process capabilities and to develop and
manufacture new products with improved process capabilities that enable
semiconductor manufacturers to fabricate semiconductors more efficiently.
Failure to introduce new products or enhancements in a timely manner could
result in loss of competitive position and reduced sales of existing products.
In particular, the Company believes that advanced logic devices and DRAMs will
require increasingly finer line widths. As a consequence, it is important to
develop and introduce a version of the Micrascan capable of exposing line widths
of less than 0.35 micron in the first half of 1996. In addition, new product
introductions could contribute to quarterly fluctuations in operating results as
orders for new products commence and increase the potential for a decline in
orders of existing products, particularly if new products are delayed. In the
past, the Company has experienced significant delays in the introduction of
certain of its products and product enhancements due to technical, manufacturing
and other difficulties and may experience similar delays in the future.
Furthermore, 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.
Significant delays can occur between a product's introduction and the
commencement by the Company of volume production of such product. There can be
no assurance that the Company will be successful in the introduction and volume
production of new and enhanced products or that the Company will be able to
develop and introduce new and enhanced products and processes which satisfy a
broad range of customer needs and achieve market acceptance.
Research and Development Funding; Certain Capital Commitments. The Company
believes that in selecting a photolithography equipment manufacturer, customers
look for a long term product development strategy and the ability to fund that
development because 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 the supplier does not have sufficient capital to implement its product
development strategy. The Company depends in part on external sources to fund
its development efforts and capital equipment expenditures. SEMATECH has entered
into agreements with the Company to provide a portion of this funding, but there
can be no assurance that the Company will be able to attain the milestones
required by the agreements for such incremental funding or that SEMATECH will be
capable of providing the agreed-upon funding, either of which could have
unfavorable impact on future photolithography development. If the Company
achieves all milestones, the SEMATECH agreements provide for an additional $21
million of such funding during fiscal 1995, 1996 and 1997, all of which the
Company expects would be an offset to its research and development expenditures.
Were the Company not to fulfill certain obligations under its agreement with
SEMATECH, the Company could be required to repay all funds received under the
agreements. In the event that the Company does not receive SEMATECH funding for
any reason, it would be required to either curtail development of
photolithography products or make up the shortfall from its own funds or other
sources. If the Company was required to make up these funds, its research and
development expenses would increase significantly and its operating income would
be reduced correspondingly.
4
<PAGE> 6
In part to address customer concerns about adequately capitalizing the
photolithography business, the Company is obligated under its agreements with
SEMATECH and Intel Corporation, Motorola Inc. and Texas Instruments
Incorporated, purchasers of the Company's Series B Convertible Redeemable
Preferred Stock in February 1995 (the "Investors"), to commit funds to the
development and production of Micrascan photolithography equipment, and a
portion of the net proceeds of this offering may be used to satisfy these
requirements. Under the terms of its agreement with SEMATECH, the Company is
obligated to fund from its own resources not less than 120%, up to a maximum of
$36 million at any time over a three year period, of the total amount received
from SEMATECH to further the development of Micrascan technology, to increase
the manufacturing capability and capacity for Micrascan products and to fund
related inventory costs. Under the terms of its agreements with the Investors,
the Company is obligated to use the $30 million from the sale of the Series B
Convertible Redeemable Preferred Stock, as well as an additional $25 million of
Company funds at any time over a five year period, to fund increased Micrascan
production capacity, increased research and development of the Micrascan
technology, the purchase of additional capital equipment and to augment working
capital for growth of the Micrascan photolithography operations. No assurance
can be given that the Company will be able to obtain the necessary funding to
meet its commitments under these agreements. The Company is obligated to invest
these funds, regardless of the success of the project. As a result, the Company
may be required to use its financial resources to comply with these commitments
even if it believes that such resources would be better utilized in other areas.
Were the Company to breach any of its obligations under its agreement with the
Investors, the Investors could cause the Company to repurchase their shares,
which could have a material adverse effect on the Company.
Customer Concentration. The Company relies on a limited number of
customers for a substantial percentage of its net sales. In fiscal 1994, Intel
Corporation ("Intel"), Motorola Inc. and SGS-Thompson represented 20%, 19% and
11%, respectively, of net sales. The Company's top five customers represented
58% of the 1994 sales, a trend which continued into the first quarter of fiscal
1995. In fiscal 1994 and the first quarter of fiscal 1995, Intel represented a
significant percentage of Track Systems Division ("Track") sales. Track
operations were responsible for a substantial portion of the Company's profits
in both periods. The loss of a significant customer (and in particular the loss
of Intel as a Track 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 the
results of operations.
Competition. The semiconductor processing equipment industry is highly
competitive. The Company faces substantial competition both in the United States
and in other countries for 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 each particular manufacturer's 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 on occasion been subject to intense price competition with
respect to particular orders and has had difficulty establishing new
relationships with certain customer 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. Due to the Company's position in the
photolithography market, an announcement of a new product by any of these large
competitors may cause customers to delay purchases until the new product is
introduced. The Company believes that its competitors will continue to improve
the design and performance of their current products and processes, and to
introduce new products and processes with improved price and performance
characteristics. For example, both Nikon and Canon, Inc. ("Canon") have
announced photolithography products using step and scan technology and a deep
ultraviolet ("Deep UV") illumination source, and Nikon has indicated that it
expects to deliver prototypes in early 1996. In addition, the Company believes
that other potential competitors, including ASM Lithography, are developing step
and scan technologies. There can be no assurance that the Company will be able
to compete effectively in the future.
5
<PAGE> 7
Importance of the Japanese and Pacific Rim Market. The Japanese and
Pacific Rim market (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 an adequate 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 collaborative effort with any Japanese or Pacific Rim
semiconductor manufacturer regarding process and equipment development. As a
result, the Company may be at a competitive disadvantage to the Japanese
equipment suppliers which are engaged in such collaborative efforts with the
Japanese and Pacific Rim semiconductor manufacturers. 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.
Termination of Canon Letter of Intent. In April 1993, the Company entered
into a letter of intent with 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 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.
Patents and Licenses. As is typical in the semiconductor equipment
industry, the Company has from time to time received, and may in the future
receive, communications form 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 is 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. The Company cannot predict the outcome of this
or any other 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 operation.
Dependence on Key Employees. The Company's future success is dependent
upon its ability to attract and retain qualified management, technical, sales
and support personnel. The competition for such personnel is intense. The loss
of certain key people or the Company's inability to attract and retain new key
employees could materially adversely affect the Company's business and results
of operations.
Dependence on Sole or Limited Source Suppliers. Certain of the raw
materials, components and subassemblies included in the Company's products 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, 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.
Volatility of Stock Price. The public offering price of the Common Stock
offered hereby may not be indicative of prices that will prevail in the trading
market for the Common Stock. The stock market has from time to time experienced
significant price and volume fluctuations that are unrelated to the operating
performance of particular companies. In addition, the market price of the
Company's Common Stock has been and is likely to be highly volatile. Factors
such as fluctuations in the Company's operating results, shortfalls in revenue
or earnings from levels expected by securities analysts, announcements of
technological
6
<PAGE> 8
innovations or new products by the Company or its competitors, governmental
regulation, developments with respect to patents or proprietary rights and
litigation relating thereto and general market conditions may have a significant
adverse effect on the market price of the Common Stock.
THE COMPANY
Silicon Valley Group, Inc. was incorporated in California in 1973 and
became a Delaware corporation in January 1987. The Company's principal executive
offices are located at 2240 Ringwood Avenue, San Jose, California 95131 and its
telephone number at that address is (408) 434-0500. The Common Stock of the
Company is traded on the Nasdaq National Market and is quoted under the symbol
"SVGI".
SELLING STOCKHOLDERS
The following table shows (i) the name of each Selling Stockholder, (ii)
the number of shares of Common Stock beneficially owned prior to the offering,
(iii) the number of shares of Common Stock to be sold by each Selling
Stockholder pursuant to this Prospectus and (iv) the number of shares
beneficially owned after the offering:
<TABLE>
<CAPTION>
SHARES BENEFICIALLY SHARES BENEFICIALLY
OWNED PRIOR TO SHARES TO BE SOLD OWNED AFTER THE
NAME OFFERING(1)(2) IN THE OFFERING(3) OFFERING
--------------------------------- -------------------- ------------------ --------------------
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Intel Corporation................ 498,100 498,100 0
Motorola Inc..................... 498,100 498,100 0
Texas Instruments Incorporated... 498,100 498,100 0
</TABLE>
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(1) Based on shares beneficially owned at March 14, 1995.
(2) No Selling Stockholder will own more than 1% of the outstanding shares of
Common Stock of the Company following the sale of the shares offered hereby.
(3) Each Selling Stockholder may offer up to such number of shares of Common
Stock of the Company.
PLAN OF DISTRIBUTION
Any broker-dealer participating in such transactions as agent may receive
commissions from the Selling Stockholders (and, if they act as agent for the
purchaser of such shares, from such purchaser). Usual and customary brokerage
fees will be paid by the Selling Stockholders. Broker-dealers may agree with the
Selling Stockholders to sell a specified number of shares at a stipulated price
per share, and, to the extent such a broker-dealer is unable to do so acting as
agent for the Selling Stockholders, to purchase as principal any unsold shares
at the price required to fulfill the broker-dealer commitment to the Selling
Stockholders. Broker-dealers who acquire shares as principal may thereafter
resell such shares from time to time in transactions (which may involve crosses
and block transactions and which may involve sales to and through other
broker-dealers, including transactions of the nature described above) in the
over-the-counter market, in negotiated transactions or otherwise at market
prices prevailing at the time of sale or at negotiated prices, and in connection
with such resales may pay to or receive from the purchasers of such shares
commissions computed as described above.
The Company has advised the Selling Stockholders that the anti-manipulative
Rules 10b-6 and 10b-7 under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), may apply to their sales in the market, has furnished each
Selling Stockholder with a copy of these Rules and has informed them of the need
for delivery of copies of this Prospectus. The Selling Stockholders may
indemnify any broker-dealer that participates in transactions involving the sale
of the shares against certain liabilities, including liabilities arising under
the Securities Act. Any commissions paid or any discounts or concessions allowed
to any such broker-dealers, and any profits received on the resale of such
shares, may be deemed to be underwriting discounts and commissions under the
Securities Act if any such broker-dealers purchase shares as principal.
7
<PAGE> 9
Upon notification by a Selling Stockholder to the Company that any material
arrangement has been entered into with a broker-dealer for the sale of shares
through a cross or block trade, a supplemental prospectus will be filed under
Rule 424(c) under the Securities Act setting forth the name of the participating
broker-dealer(s), the number of shares involved, the price at which such shares
were sold by the Selling Stockholder, the commissions paid or discounts or
concessions allowed by the Selling Stockholder to such broker-dealer(s), and
where applicable, that such broker-dealer(s) did not conduct any investigation
to verify the information set out in this Prospectus.
Any securities covered by this Prospectus which qualify for sale pursuant
to Rule 144 under the Securities Act may be sold under that Rule rather than
pursuant to this Prospectus.
There can be no assurance that any of the Selling Stockholders will sell
any or all of the shares of Common Stock offered by them hereunder.
The Company has agreed to indemnify each Selling Stockholder, each of its
officers and directors and each person controlling such Selling Stockholder
within the meaning of Section 15 of the Securities Act, with respect to which
registration, qualification or compliance has been effected against all
expenses, claims, losses, damages and liabilities (or actions in respect
thereof), including any of the foregoing incurred in settlement of any
litigation, arising out of or based on any untrue statement (or alleged untrue
statement) of a material fact contained in any registration statement,
prospectus, offering circular or other document, or any amendment or supplement
thereto, incident to any such registration, qualification or compliance, or
based on any omission (or alleged omission) to state therein a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances in which they were made, not misleading, or any
violation by the Company of any rule or regulation promulgated under the
Securities Act applicable to the Company and relating to action or inaction
required of the Company in connection with any such registration, qualification
or compliance, and will reimburse each such Selling Stockholder, each of its
officers and directors and each person controlling such Selling Stockholder,
each such underwriter and each person who controls any such underwriter, for any
legal and any other expenses reasonably incurred in connection with
investigating, preparing or defending any such claim, loss, damage, liability or
action, provided that the Company will not be liable in any such case to the
extent that any such claim, loss, damage, liability or expense arises out of or
is based on any untrue statement or omission or alleged untrue statement or
omission, made in reliance upon and in conformity with information furnished to
the Company by such Selling Stockholder or underwriter and stated to be
specifically for use therein.
INFORMATION INCORPORATED BY REFERENCE
There are hereby incorporated by reference in this Prospectus the following
documents and information heretofore filed with the Securities and Exchange
Commission:
(1) The Company's Annual Report on Form 10-K for the fiscal year ended
September 30, 1994, filed pursuant to Section 13 of the Exchange Act.
(2) The Company's Quarterly Report on Form 10-Q for the fiscal quarter
ended December 31, 1994, pursuant to Section 13 of the Exchange Act.
(3) The Company's Current Report on Form 8-K filed on March 2, 1995.
(4) The Company's Registration Statement on Form 8-A filed with the
Securities and Exchange Commission on November 23, 1983.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14
and 15(d) of the Exchange Act, after the date of this Prospectus and prior to
the filing of a post-effective amendment which indicates that all securities
offered have been sold or which deregisters all securities then remaining
unsold, shall be deemed to be incorporated by reference in this Prospectus and
to be part hereof from the date of filing such documents.
8
<PAGE> 10
LEGAL MATTERS
Wilson, Sonsini, Goodrich & Rosati, Professional Corporation, 650 Page Mill
Road, Palo Alto, California 94304-1050, counsel to the Company, will render an
opinion to the effect that the Common Stock offered hereby is duly and validly
issued, fully paid and non-assessable. Larry W. Sonsini, a member of such firm,
is a director and Secretary of the Company and holds options to purchase 14,500
shares of the Company's Common Stock.
9
<PAGE> 11
SILICON VALLEY GROUP, INC.
REGISTRATION STATEMENT ON FORM S-3
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM NUMBER
ITEM 14 OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.*
<TABLE>
<S> <C>
Registration fee -- Securities and Exchange Commission..................... $13,140
NASD fees.................................................................. 0
Accountant's fees.......................................................... 3,000
Legal fees................................................................. 5,000
Miscellaneous.............................................................. 5,000
-------
Total $26,140
=======
</TABLE>
- ---------------
* Represents expenses relating to the distribution by Selling Stockholders
pursuant to the Prospectus prepared in accordance with the requirements of
Form S-3. These expenses will be borne by the Company on behalf of the Selling
Stockholders.
ITEM 15 INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Company has adopted provisions in its Certificate of Incorporation that
limit the liability of its directors and enable the Company to broaden the
indemnification provided to its directors and officers. As permitted by the
Delaware General Corporation Law, directors will not be liable for monetary
damages arising from a breach of their fiduciary duty as directors in certain
circumstances. Such limitation does not affect liability of a director to the
Company or its shareholders for (i) breaches of the director's duty of loyalty,
(ii) acts or omissions not in good faith or involving intentional misconduct or
knowing violations of law, (iii) the payment of unlawful dividends or unlawful
stock repurchases or redemptions or (iv) transactions in which the director
received an improper personal benefit. Such limitation of liability does not
affect the availability of equitable remedies such as injunctive relief or
rescission.
The Company's Bylaws provide that the Company shall indemnify its directors
and officers to the maximum extent permitted by Delaware law, including
circumstances in which indemnification is otherwise discretionary under Delaware
law. The Company has also entered into indemnification agreements with its
officers and directors containing provisions which are in some respects broader
than the specific indemnification provisions contained in the Delaware General
Corporation Law. The Indemnification Agreements may require the Company, among
other things, to indemnify such officers and directors against certain
liabilities that may arise by reason of their status or service as directors or
officers if they acted in good faith and in a manner they reasonably believed to
be in or not opposed to the best interests of the Company and, with respect to
any criminal proceeding, had no reasonable cause to believe their conduct was
unlawful, to advance their expenses incurred as a result of any proceeding
against them as to which they could be indemnified, and to obtain directors' and
officers' insurance if available on reasonable terms.
The Company understands that the staff of the Securities and Exchange
Commission is of the opinion that statutory, charter and contractual provisions
as are described above have no effect on claims arising under the federal
securities laws. The Company is not aware of any material threatened or ongoing
litigation or proceeding which may result in a claim for such indemnification.
II-1
<PAGE> 12
ITEM 16 EXHIBITS.
<TABLE>
<CAPTION>
EXHIBIT
NUMBER
- ------
<C> <S> <C>
5.1 Opinion of Wilson, Sonsini, Goodrich &
Rosati
23.1 Independent Auditors Consent
23.2 Consent of Wilson, Sonsini, Goodrich &
Rosati (Included in Exhibit 5.1)
24.1 Power of Attorney, see page II-3
</TABLE>
ITEM 17 UNDERTAKINGS.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement to include
any material information with respect to the plan of distribution not
previously disclosed in the registration statement or any material change
to such information in this registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, as amended (the "Securities Act"), each such
post-effective amendment shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide
offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(4) That, for purposes of determining any liability under the
Securities Act, each filing of the registrant's annual report pursuant to
Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934, as
amended that is incorporated by reference in this registration statement
shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
II-2
<PAGE> 13
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of San Jose, State of California, on the 14th day of
March, 1995.
SILICON VALLEY GROUP, INC.
By: /s/ RUSSELL G. WEINSTOCK
---------------------------------------
Russell G. Weinstock
Vice President, Finance and
Chief Financial Officer
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Russell G. Weinstock, his
attorney-in-fact, with the power of substitution, for him in any and all
capacities, to sign any and all amendments to this Registration statement
(including post-effective amendments), and to file the same, with exhibits
thereto and other documents in connection therewith, with the Securities and
Exchange Commission, hereby ratifying and confirming all that each of said
attorneys-in-fact, or his substitute or substitutes, may do or cause to be done
by virtue hereof.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- --------------------------------------------- ------------------------------------ ---------------
<C> <S> <C>
/s/ PAPKEN S. DER TOROSSIAN Chairman of the Board and Chief March 14, 1995
- --------------------------------------------- Executive Officer
(Papken S. Der Torossian)
/s/ RUSSELL G. WEINSTOCK Vice President, Finance and Chief March 14, 1995
- --------------------------------------------- Financial Officer
(Russell G. Weinstock)
/s/ WILLIAM A. HIGHTOWER Director March 14, 1995
- ---------------------------------------------
(William A. Hightower)
/s/ NAM P. SUH Director March 14, 1995
- ---------------------------------------------
(Nam P. Suh)
/s/ WILLIAM L. MARTIN Director March 14, 1995
- ---------------------------------------------
(William L. Martin)
/s/ JOHN B. MCBENNETT Director March 14, 1995
- ---------------------------------------------
(John B. McBennett)
/s/ LARRY W. SONSINI Director March 14, 1995
- ---------------------------------------------
(Larry W. Sonsini)
</TABLE>
II-3
<PAGE> 14
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION PAGE
- ------ ------------------------------------------------------------------------------ ----
<C> <S> <C>
5.1 Opinion of Wilson, Sonsini, Goodrich & Rosati
23.1 Independent Auditors Consent
23.2 Consent of Wilson, Sonsini, Goodrich & Rosati (Included in Exhibit 5.1)
</TABLE>
<PAGE> 1
EXHIBIT 5.1
March 16, 1995
Silicon Valley Group, Inc.
2240 Ringwood Avenue
San Jose, CA 95131
RE: REGISTRATION STATEMENT ON FORM S-3
Ladies and Gentlemen:
We have examined the Registration Statement on Form S-3 to be filed by you
with the Securities and Exchange Commission on March 16, 1995, (the
"Registration Statement") in connection with the registration under the
Securities Act of 1933, as amended, of 1,494,300 shares of your Common Stock
(the "Shares") to be sold by certain of your stockholders (the "Selling
Stockholders"). As your legal counsel, we have examined the proceedings taken
and proposed to be taken in connection with the sale of the Shares by the
Selling Stockholders in the manner set forth in the Registration Statement in
the section entitled "Plan of Distribution".
It is our opinion that the Shares, when sold by the Selling Stockholders in
the manner referred to in the Registration Statement, will be legally and
validly issued, fully paid and nonassessable.
We consent to the use of this opinion as an exhibit to the Registration
Statement and further consent to the use of our name wherever appearing in the
Registration Statement, including any Prospectus constituting a part hereof, and
any amendments thereto.
Very truly yours,
WILSON, SONSINI, GOODRICH & ROSATI
Professional Corporation
<PAGE> 1
EXHIBIT 23.1
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
Silicon Valley Group, Inc. on Form S-3 of our reports dated October 22, 1994,
appearing and incorporated by reference in the Annual Report on Form 10-K of
Silicon Valley Group, Inc. for the year ended September 30, 1994.
DELOITTE & TOUCHE LLP
San Jose, California
March 15, 1995
