Employee Stock Plans (Tables)

9 Months Ended

Jun. 28, 2013

Net Share-Based Compensation Expense

The table below summarizes the net share-based compensation expense recognized for employee stock awards and for the option component of the employee stock purchase plan shares:

	ThreeMonthsEnded								NineMonthsEnded
(In thousands, except per share amounts)	June28, 2013				June29, 2012				June28, 2013				June29, 2012
Cost of revenues – Product	$	1,058		$		1,107		$		3,443		$		3,351
Cost of revenues – Service contracts and other		1,069				317				2,530				1,184
Research and development		1,515				1,574				4,741				4,833
Selling, general and administrative		6,882				8,518				23,201				27,287
Taxes on earnings		(3,181	)			(3,728	)			(10,359	)			(11,776	)
Net share-based compensation expense	$	7,343		$		7,788		$		23,556		$		24,879

Fair Value of Employee Stock Option Plans with Weighted Average Assumptions

The fair value of options granted was estimated at the date of grant using the Black-Scholes model with the following weighted average assumptions:

	ThreeMonthsEnded							NineMonthsEnded
	June28, 2013				June29, 2012				June28, 2013				June29, 2012
Employee Stock Option Plans
Expected term (in years)		4.77				4.55				4.76				4.64
Risk-free interest rate		0.7	%			0.7	%			0.6	%			0.8	%
Expected volatility		29.6	%			34.3	%			32.2	%			36.9	%
Expected dividend		0.0	%			0.0	%			0.0	%			0.0	%
Weighted average fair value at grant date	$	18.21		$		19.14		$		19.73		$		18.75

Fair Value of Employee Stock Purchase Plan With Weighted Average Assumptions

The option component of employee stock purchase plan shares was estimated at the date of grant using the Black-Scholes model with the following weighted average assumptions:

	ThreeMonthsEnded						NineMonthsEnded
	June28, 2013			June29, 2012				June28, 2013			June29, 2012
Employee Stock Purchase Plan
Expected term (in years)		0.50			0.50				0.50				0.50
Risk-free interest rate		0.1	%		0.1	%			0.1	%			0.1	%
Expected volatility		13.6	%		18.0	%			16.5	%			20.6	%
Expected dividend		0.0	%		0.0	%			0.0	%			0.0	%
Weighted average fair value at grant date	$	12.21		$	12.16			$	12.95			$	12.38

Activity Under Employee Stock Plans

Activity under the Company’s employee stock plans is presented below:

				Options Outstanding
(In thousands, except per share amounts)	Shares Available forGrant			Numberof Shares			Weighted Average Exercise Price		Weighted- Average Remaining Contractual Term (inyears)		Aggregate Intrinsic Value(3)
Balance at September28, 2012		11,868			6,459		$	48.34
Granted (1)		(2,025	)		611			68.92
Cancelled or expired (2)		93			(16	)		59.84
Exercised		—			(2,001	)		45.09
Balance at June28, 2013		9,936			5,053		$	52.08		3.2	$	78,705
Exercisable at June28, 2013					4,169		$	49.32		2.7	$	75,834

(1) The difference between the number of shares granted listed in the column headed “Shares Available for Grant” and the number of shares granted listed in the column headed “Options Outstanding—Number of Shares” represents the awards of deferred stock units, restricted stock units and performance units. Deferred stock unit, restricted stock unit and performance unit awards were counted against the shares available for grant limit as 2.5 shares for every one awarded before February9, 2012 and were counted against the shares available for grant limit as 2.6 shares for every one awarded on or after February9, 2012. In addition, the shares available for grant limit was further adjusted to reflect a maximum payout of 1.5 shares that could be issued for each performance unit granted.

(2) The difference between the number of cancelled or expired shares listed in the column headed “Shares Available for Grant” and the number of cancelled or expired shares listed in the column headed “Options Outstanding—Number of Shares” represents the cancellation of shares of restricted common stock and restricted stock units due to employee terminations.

(3) The aggregate intrinsic value represents the total pre-tax intrinsic value of options, which is computed based on the difference between the exercise price and VMS’s closing common stock price of $67.45 as of June28, 2013, that last trading date of the third quarter of fiscal year 2013, and which would have been received by the option holders had all option holders exercised and sold their options as of that date.

Schedule of Nonvested Restricted Stock Units Activity [Table Text Block]

The activity for restricted stock, restricted stock units, deferred stock units and performance units is summarized as follows:

(In thousands, except per share amounts)	Shares			WeightedAverage Grant-DateFair Value
Balance at September28, 2012		945		$	57.30
Granted		509			70.34
Vested		(396	)		55.57
Cancelled or expired		(28	)		61.75
Balance at June28, 2013		1,030		$	64.30