10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

——————————————————————————————————————

FORM 10-Q

(Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2012

OR

o 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 000-33043

——————————————————————————————————————

Omnicell, Inc.

(Exact name of registrant as specified in its charter)

Delaware	94-3166458
(State or other jurisdiction	(I.R.S. Employer
of incorporation or organization)	Identification No.)

1201 Charleston Road

Mountain View, CA 94043

(650) 251-6100

(Address, including zip code, of registrant’s principal executive

offices and registrant’s telephone number, including area code)

——————————————————————————————————————  

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer o	Accelerated filer x
Non-accelerated filer o	Smaller reporting company o
(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

The number of shares of Registrant’s common stock (par value $0.001) outstanding as of August 1, 2012 was 33,301,933.

OMNICELL, INC.

FORM 10-Q

Table of Contents

		Page number
PART I—FINANCIAL INFORMATION
Item 1.	Financial Statements:	3
	Condensed Consolidated Balance Sheets as of June 30, 2012 (unaudited) and December 31, 2011	3
	Unaudited Condensed Consolidated Statements of Operations for the three months and six months ended June 30, 2012 and 2011	4
	Unaudited Condensed Consolidated Statements of Comprehensive Income for the three months and six months ended June 30, 2012 and 2011	2
	Unaudited Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2012 and 2011	6
	Notes to Unaudited Condensed Consolidated Financial Statements	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	26
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	33
Item 4.	Controls and Procedures	33
PART II—OTHER INFORMATION		35
Item 1.	Legal Proceedings	35
Item 1A.	Risk Factors	35
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	46
Item 3.	Defaults Upon Senior Securities	46
Item 4.	Mine Safety Disclosures	46
Item 5.	Other Information	46
Item 6.	Exhibits	47
SIGNATURES		49
INDEX TO EXHIBITS		50

2

PART 1 — FINANCIAL INFORMATION

Item 1. Financial Statements

OMNICELL, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

	June 30, 2012		December 31, 2011
	(unaudited)		(1)
ASSETS
Current assets:
Cash and cash equivalents	$	54,071	$	191,762
Short-term investments	—		8,107
Accounts receivable, net of allowances of $337 and $443 at June 30, 2012 and December 31, 2011, respectively	46,390		38,661
Inventories	25,170		18,107
Prepaid expenses	11,609		10,495
Deferred tax assets	11,197		10,352
Other current assets	7,164		6,107
Total current assets	155,601		283,591
Property and equipment, net	28,965		17,306
Non-current net investment in sales-type leases	9,826		8,785
Goodwill	113,034		28,543
Other intangible assets	87,242		4,231
Non-current deferred tax assets	—		11,677
Other assets	9,959		9,716
Total assets	$	404,627	$	363,849
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	15,687	$	11,000
Accrued compensation	13,323		7,328
Accrued liabilities	9,956		8,901
Deferred service revenue	19,791		19,191
Deferred gross profit	14,478		14,210
Total current liabilities	73,235		60,630
Non-current deferred service revenue	18,471		18,966
Non-current deferred tax liabilities	22,124		—
Other long-term liabilities	3,277		1,339
Total liabilities	117,107		80,935
Stockholders’ equity:
Total stockholders’ equity	287,520		282,914
Total liabilities and stockholders’ equity	$	404,627	$	363,849

(1)  Information derived from our December 31, 2011 audited Consolidated Financial Statements.

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

3

OMNICELL, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

	Three Months Ended June 30,					Six Months Ended June 30,
	2012			2011		2012		2011
Revenues:
Product revenues	$	59,269		$	46,218	$	107,793	$	88,793
Services and other revenues	16,115			14,787		31,734		29,372
Total revenues	75,384			61,005		139,527		118,165
Cost of revenues:
Cost of product revenues	28,600			19,730		48,896		37,566
Cost of services and other revenues	7,408			7,468		15,506		15,142
Total cost of revenues	36,008			27,198		64,402		52,708
Gross profit	39,376			33,807		75,125		65,457
Operating expenses:
Research and development	5,499			5,280		11,993		10,120
Selling, general and administrative	31,446			24,297		57,066		50,078
Total operating expenses	36,945			29,577		69,059		60,198
Income from operations	2,431			4,230		6,066		5,259
Interest and other income (expense), net	(73		)	71		23		125
Income before provision for income taxes	2,358			4,301		6,089		5,384
Provision for income taxes	983			1,714		2,363		2,127
Net income	$	1,375		$	2,587	$	3,726	$	3,257
Net income per share-basic	$	0.04		$	0.08	$	0.11	$	0.10
Net income per share-diluted	$	0.04		$	0.08	$	0.11	$	0.10
Weighted average shares outstanding:
Basic	33,390			33,003		33,377		33,093
Diluted	34,316			33,981		34,329		34,039

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

4

OMNICELL, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands)

	Three Months Ended June 30,					Six Months Ended June 30,
	2012			2011		2012			2011
Net income	$	1,375		$	2,587	$	3,726		$	3,257
Other comprehensive income, net of tax:
Unrealized loss on securities:
Unrealized holding losses arising during the period	(3		)	—		(1		)	—
Changes in fair value of foreign currency forward hedges	65			—		65			—
Foreign currency translation adjustment	(16		)	—		(16		)	—
Other comprehensive income	46			—		48			—
Comprehensive income	$	1,421		$	2,587	$	3,774		$	3,257

The accompanying notes are an integral part of these condensed consolidated financial statements

5

OMNICELL, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

	Six Months Ended June 30,
	2012			2011
Cash flows from operating activities:
Net income	$	3,726		$	3,257
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	5,333			3,794
Loss on disposal of fixed assets	19			—
Provision for (recovery of) receivable allowance	335			(43		)
Share-based compensation expense	4,420			4,843
Income tax benefits from employee stock plans	(156		)	2,303
Excess tax benefits from employee stock plans	(901		)	(2,517		)
Provision for excess and obsolete inventories	254			865
Foreign currency remeasurement loss	(23		)	(8		)
Deferred income taxes	(535		)	(491		)
Changes in operating assets and liabilities:
Accounts receivable, net	(287		)	(384		)
Inventories	4,409			(8,462		)
Prepaid expenses	(1,114		)	1,391
Other current assets	799			(288		)
Net investment in sales-type leases	(780		)	710
Other assets	(27		)	215
Accounts payable	(817		)	1,138
Accrued compensation	5,995			391
Accrued liabilities	(3,320		)	(1,260		)
Deferred service revenue	449			2,278
Deferred gross profit	268			(419		)
Other long-term liabilities	711			(50		)
Net cash provided by operating activities	18,758			7,263
Cash flows from investing activities:
Maturities of short-term investments	8,122			8,143
Acquisition of intangible assets and intellectual property	(249		)	(69		)
Software development for external use	(1,414		)	(3,088		)
Purchases of property and equipment	(4,087		)	(4,764		)
Business acquisition, net of cash acquired	(156,312		)	—
Net cash (used in) provided by investing activities	(153,940		)	222
Cash flows from financing activities:
Proceeds from issuance of common stock under employee stock purchase and stock option plans	3,627			3,613
Stock repurchases	(7,060		)	(8,000		)
Excess tax benefits from employee stock plans	901			2,517
Net cash used in financing activities	(2,532		)	(1,870		)
Effect of exchange rate changes on cash and cash equivalents	23			8
Net (decrease) increase in cash and cash equivalents	(137,691		)	5,623
Cash and cash equivalents at beginning of period	191,762			175,635
Cash and cash equivalents at end of period	$	54,071		$	181,258
Supplemental disclosure of non-cash operating activity:
Acquisition consideration accrued but not paid	$	(1,833	)	$	—
Satisfaction of acquired legal contingency with indemnification asset	—			(1,200		)

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

6

OMNICELL, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Note 1. Organization and Summary of Significant Accounting Policies

Description of the Company. Omnicell, Inc. (“Omnicell,” “our,” “us,” “we,” or the “Company”) was incorporated in California in 1992 under the name Omnicell Technologies, Inc. and reincorporated in Delaware in 2001 as Omnicell, Inc. Our major products are medication control systems together with related consumables and services, and medical/surgical supply control systems, with related services, which are sold in our principal market, the healthcare industry. Our market is located primarily in the United States.

On May 21, 2012, we completed our acquisition of MedPak Holdings, Inc. (“MedPak”). MedPak is the parent company of MTS Medication Technologies, Inc. (“MTS”), a worldwide provider of medication adherence packaging systems. This acquisition aligns us with the long-term trends of the healthcare market to manage the health of patients across the continuum of care. We can now serve both the acute care and non-acute markets. Omnicell and MTS bring capabilities to each other that strengthen the product lines and expand the medication management coverage of both companies. Please refer to Note 14, “Business Acquisition” for more information.

Basis of presentation. These interim condensed consolidated financial statements are unaudited but reflect, in the opinion of management, all adjustments, consisting of normal recurring adjustments and accruals, necessary to present fairly the financial position of Omnicell and its subsidiaries as of June 30, 2012, the results of their operations and comprehensive income for the three months and six months ended June 30, 2012 and 2011 and their cash flows for the six months ended June 30, 2012 and 2011. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”), have been condensed or omitted in accordance with the rules and regulations of the Securities and Exchange Commission (“SEC”). These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and accompanying notes included in our Annual Report on Form 10-K for the year ended December 31, 2011.

Our results of operations, comprehensive income and cash flows for the three months and six months ended June 30, 2012 are not necessarily indicative of results that may be expected for the year ending December 31, 2012, or for any future period. 

Use of estimates. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

Principles of consolidation. The condensed consolidated financial statements include the accounts of our wholly-owned subsidiaries. All significant inter-company accounts and transactions have been eliminated in consolidation.

Reclassifications. Certain reclassifications have been made to the prior year consolidated balance sheet to conform to the current period presentation, including reclassification of net receivable credit balances by customer from accounts receivable to customer advances. None of these reclassifications are material to the consolidated financial statements.

Foreign currency translation. We translate the assets and liabilities of our non-U.S. dollar functional currency subsidiaries into U.S. dollars using exchange rates in effect at the end of each period. Revenue and expenses for these subsidiaries are translated using rates that approximate those in effect during the period. Gains and losses from these translations are recorded as foreign currency translation adjustments and included in accumulated other comprehensive income in stockholders’ equity.

Fair value of financial instruments. We value our financial assets and liabilities on a recurring basis using the fair value hierarchy established in Accounting Standards Codification (“ASC”) 820, Fair Value Measurements and Disclosures.

ASC 820 describes three levels of inputs that may be used to measure fair value, as follows:

Level 1 inputs, which include quoted prices in active markets for identical assets or liabilities;

Level 2 inputs, which include observable inputs other than Level 1 inputs, such as quoted prices for similar assets or liabilities, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are

7

observable or can be corroborated by observable market data for substantially the full term of the asset or liability; and

Level 3 inputs, which include unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the underlying asset or liability. Level 3 assets and liabilities include those whose fair value measurements are determined using pricing models, discounted cash flow methodologies or similar valuation techniques, as well as significant management judgment or estimation.

At June 30, 2012 and December 31, 2011, our financial assets, measured at fair value on a recurring basis, utilizing Level 1 inputs included cash equivalents. For these items, quoted market prices are readily available and fair value approximates carrying value. At December 31, 2011, we had a short-term investment in California revenue anticipation notes, measured at fair value on a recurring basis, the valuation inputs of which were classified as Level 2. We do not currently have any material financial instruments, measured at fair value on a recurring basis, utilizing Level 3 inputs.

Classification of marketable securities. Securities held as investments for the indefinite future, pending future spending requirements are classified as “Available-for-sale” and are carried at their fair value, with any unrealized gain or loss recorded to other comprehensive income until realized. At June 30, 2012 and December 31, 2011, we held $33.6 million and $177.3 million, respectively, of money market mutual funds classified as Available-for-sale cash equivalents. At December 31, 2011, we held $8.1 million of non-U.S. Government securities classified as Available-for-sale short-term investments. We do not hold securities for purposes of trading. Marketable securities for which we have the intent and ability to hold to maturity are classified as “Held-to-maturity” and are carried at their amortized cost, including accrued interest. There were no Held-to-maturity securities held at June 30, 2012 and December 31, 2011.

Accounting for derivatives and hedging activities. Commencing with our May 21, 2012 acquisition of MTS, we use derivative financial instruments to limit exposure to changes in foreign currency exchange rates. We account for derivatives pursuant to ASC 815, Derivatives and Hedging. The ASC 815 guidance establishes accounting and reporting standards for derivative instruments and requires that all derivatives be recorded at fair value on the balance sheet. Changes in the fair value of derivative financial instruments are either recognized in other comprehensive income (a component of shareholders’ equity) or net income depending on whether the derivative is being used to hedge changes in cash flows or fair value.

Segment information. Beginning with the May 21, 2012 acquisition of MTS, we manage our business on the basis of two operating segments: Acute Care and Non-Acute Care. The historical Omnicell results reported as a single segment and reporting unit comprise the Acute Care segment. MTS comprises the Non-Acute Care segment and reporting unit.

Revenue recognition. We earn revenues from sales of our medication control systems together with related consumables and services, and medical/surgical supply control systems, with related services, which are sold in our principal market, which is the healthcare industry. Our customer arrangements typically include one or more of the following deliverables:

• Products — Software-enabled equipment that manages and regulates the storage and dispensing of pharmaceuticals, consumable blister cards and packaging equipment and other medical supplies.

• Software — Additional software applications that enable incremental functionality of our equipment.

• Installation — Installation of equipment as integrated systems at customers’ sites.

• Post-installation technical support — Phone support, on-site service, parts and access to unspecified software upgrades and enhancements, if and when available.

• Professional services — Other customer services, such as training and consulting.

We recognize revenue on our equipment when the earnings process is complete, based upon our evaluation of whether the following four criteria have been met:

•Persuasive evidence of an arrangement exists. We use signed customer contracts and signed customer purchase orders as evidence of an arrangement for leases and sales. For service engagements, we use a signed services agreement and a statement of work to evidence an arrangement.

•Delivery has occurred. Equipment and software product delivery is deemed to occur upon successful installation and receipt of a signed and dated customer confirmation of installation letter, providing evidence that we have delivered what a customer ordered. In instances of a customer self-installed installation, product delivery is deemed to have occurred upon receipt of a signed and dated customer confirmation letter. If a sale does not require installation, we recognize revenue on delivery of products to the customer, including transfer of title and risk of loss, assuming all other revenue criteria are met. We recognize revenue from sales of products to distributors upon delivery, assuming all other revenue criteria are met since we do not allow for rights of return or refund. Assuming all other revenue criteria are met, we recognize revenue for support services

8

ratably over the related support services contract period. We recognize revenue on training and professional services as they are performed.

•Fee is fixed or determinable. We assess whether a fee is fixed or determinable at the outset of the arrangement based on the payment terms associated with the transaction. We have established a history of collecting under the original contract without providing concessions on payments, products or services.

•Collection is probable. We assess the probability of collecting from each customer at the outset of the arrangement based on a number of factors, including the customer’s payment history and its current creditworthiness. If, in our judgment, collection of a fee is not probable, we defer the revenue until the uncertainty is removed, which generally means revenue is recognized upon our receipt of cash payment assuming all other revenue criteria are met. Our historical experience has been that collection from our customers is generally probable.

In arrangements with multiple deliverables, assuming all other revenue criteria are met, we recognize revenue for individual delivered items if they have value to the customer on a standalone basis. Effective for new or modified arrangements entered into beginning on January 1, 2011, the date we adopted the revised revenue recognition guidance for arrangements with multiple deliverables on a prospective basis, we allocate arrangement consideration at the inception of the arrangement to all deliverables using the relative selling price method. This method requires us to determine the selling price at which each deliverable could be sold if it were sold regularly on a standalone basis. When available, we use vendor-specific objective evidence (“VSOE”) of fair value as the selling price. VSOE represents the price charged for a deliverable when it is sold separately or for a deliverable not yet being sold separately, the price established by management with the relevant authority. We consider VSOE to exist when approximately 80% or more of our standalone sales of an item are priced within a reasonably narrow pricing range (plus or minus 15% of the median rates). We have established VSOE of fair value for our post-installation technical support services and professional services. When VSOE of fair value is not available, third-party evidence (“TPE”) of fair value for similar products and services is acceptable; however, our offerings and market strategy differ from those of our competitors, such that we cannot obtain sufficient comparable information about third parties’ prices. If neither VSOE nor TPE are available, we use our best estimates of selling prices (“BESP”). We determine BESP considering factors such as market conditions, sales channels, internal costs and product margin objectives and pricing practices. We regularly review and update our VSOE, TPE and BESP information and obtain formal approval by appropriate levels of management.

The relative selling price method allocates total arrangement consideration proportionally to each deliverable on the basis of its estimated selling price. In addition, the amount recognized for any delivered items cannot exceed that which is not contingent upon delivery of any remaining items in the arrangement.

We also use the residual method of allocating the arrangement consideration in certain circumstances. We use the residual method to allocate total arrangement consideration between delivered and undelivered items for any arrangements entered into prior to January 1, 2011 and not subsequently materially-modified. The use of the residual method is required by software revenue recognition rules that applied to sales of most of our products and services until the adoption of the new revenue recognition guidance. We also use the residual method to allocate revenue between the software products that enable incremental equipment functionality and thus are not deemed to deliver its essential functionality, and the related post-installation technical support, as these products and services continue to be accounted for under software revenue recognition rules. Under the residual method, the amount allocated to the undelivered elements equals VSOE of fair value of these elements. Any remaining amounts are attributed to the delivered items and are recognized when those items are delivered.

A portion of our sales are made through multi-year lease agreements. Under sales-type leases, we recognize revenue for our hardware and software products net of lease execution costs such as post-installation product maintenance and technical support, at the net present value of the lease payment stream once our installation obligations have been met. We optimize cash flows by selling a majority of our non-U.S. government leases to third-party leasing finance companies on a non-recourse basis. We have no obligation to the leasing company once the lease has been sold. Some of our sales-type leases, mostly those relating to U.S. government hospitals, are retained in-house. Interest income in these leases is recognized in product revenue using the interest method.

We recognize revenue on the sale of consumable blister cards when title and risk of loss to the products shipped has transferred to the customer. Revenue related to these products is reported net of discounts provided to customers.

Accounts receivable and notes receivable (net investment in sales type leases). We actively manage our accounts receivable to minimize credit risk. We typically sell to customers for which there is a history of successful collection. New customers are subject to a credit review process, which evaluates that customer’s financial position and ability to pay. We continually monitor and evaluate the collectability of our trade receivables based on a combination of factors. We record specific allowances for doubtful accounts when we become aware of a specific customer’s impaired ability to meet its financial

9

obligation to us, such as in the case of bankruptcy filings or deterioration of financial position.

Uncollectible amounts are charged off against trade receivables and the allowance for doubtful accounts when we make a final determination there is no reasonable expectation of recovery. Estimates are used in determining our allowances for all other customers based on factors such as current trends, the length of time the receivables are past due and historical collection experience. While we believe that our allowance for doubtful accounts receivable is adequate and that the judgment applied is appropriate, such estimated amounts could differ materially from what will actually be uncollectible in the future.

The retained in-house leases discussed above are considered financing receivables. Our credit policies and evaluation of credit risk and write-off policies are applied alike to trade receivables and the net-investment in sales-type leases. For both, an account is generally past due after thirty days. The financing receivables also have customer-specific reserves for accounts identified for specific impairment and a non-specific reserve applied to the remaining population, based on factors such as current trends, the length of time the receivables are past due and historical collection experience. The retained in-house leases are not stratified by portfolio or class. Financing receivables which are reserved are generally transferred to cash-basis accounting so that revenue is recognized only as cash is received. However, the cash basis accounts continue to accrue interest.

Sales of accounts receivable. We record the sale of our accounts receivables as “true sales” in accordance with accounting guidance for transfers and servicing of financial assets. During the three months ended June 30, 2012 and 2011, we transferred non-recourse accounts receivable totaling $15.7 million and $12.2 million, respectively, which approximated fair value, to third-party leasing companies. During the six months ended June 30, 2012 and 2011, we transferred non-recourse accounts receivable totaling $27.8 million and $23.2 million, respectively, which approximated fair value, to third-party leasing companies. At June 30, 2012 and December 31, 2011, accounts receivable included $0.7 million and $0.2 million, respectively, due from third-party leasing companies for transferred non-recourse accounts receivable.

Concentration in revenues and in accounts receivable. There were no customers accounting for 10% or more of revenues in the three months ended June 30, 2012 or 2011. Additionally, there were no customers accounting for 10% or more of revenues in the six months ended June 30, 2012 or 2011. There were no customers accounting for 10% or more of accounts receivable at June 30, 2012 or at December 31, 2011.

Accounting policy for shipping costs. Outbound freight billed to customers is recorded as product revenue. The related shipping and handling cost is expensed as part of selling, general and administrative expense. Such shipping and handling expenses totaled $0.8 million and $0.8 million for the three months ended June 30, 2012 and 2011, respectively. Shipping and handling expenses totaled $1.5 million and $1.4 million for the six months ended June 30, 2012 and 2011, respectively

Dependence on suppliers. We have a supply agreement with one primary supplier for construction and supply of several sub-assemblies and inventory management of sub-assemblies used in our hardware products. There are no minimum purchase requirements. The contract may be terminated by either the supplier or by us without cause and at any time upon delivery of two months’ notice. Purchases from this supplier for the three months ended June 30, 2012 and 2011 were approximately $5.2 million and $5.7 million, respectively. Purchases from this supplier for the six months ended June 30, 2012 and 2011 were approximately $11.5 million and $11.2 million, respectively.

Income taxes. We record an income tax provision for the anticipated tax consequences of the reported results of operations. In accordance with GAAP, the provision for income taxes is computed using the asset and liability method, under which deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities, and for operating losses and tax credit carry forwards. Deferred tax assets and liabilities are measured using the enacted tax rates expected to apply in the periods in which those tax assets and liabilities are expected to be realized. In the event that we determine all or part of the net deferred tax assets are not realizable in the future, we will record a valuation allowance that would be charged to earnings in the period such determination is made.

In accordance with ASC 740, Tax Provisions, we recognize the tax benefit from an uncertain tax position if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such positions are then measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. The calculation of tax liabilities involves significant judgment in estimating the impact of uncertainties in the application of GAAP and complex tax laws. Resolution of these uncertainties in a manner inconsistent with management’s expectations could have a material impact on our financial condition and operating results.

We provide for income taxes for each interim period based on the estimated annual effective tax rate for the year,

10

adjusting for discrete items in the quarter in which they arise. The annual effective tax rate before discrete items was 40.9% and 41.7% for the six months ended June 30, 2012 and 2011, respectively. The 2012 annual effective tax rate differed from the statutory rate of 35% primarily due to the unfavorable impact of state income taxes, non-deductible equity charges, and other non-deductible expenditures, which were partially offset by the domestic production activities deduction.

The 2011 annual effective tax rate differed from the statutory rate of 35%, primarily due to the unfavorable impact of state income taxes, non-deductible equity charges, and other non-deductible expenditures, which were partially offset by the federal research and development credit claimed and the domestic production activities deduction. Our effective tax rate, after discrete items, for the six months ended June 30, 2012 and 2011, was approximately 40.4% and 41.0%, respectively.

As of June 30, 2012, we had total gross unrecognized tax benefits of approximately $7.2 millioncompared with approximately $5.8 millionon December 31, 2011, representing an increase of approximately $1.4 millionduring the six months ended June 30, 2012. Approximately $1.0 million of the increase was attributable to unrecognized tax benefits recorded as part of the MTS acquisition. Of the total unrecognized tax benefits, $6.0 millionand $4.6 millionas of June 30, 2012 and  December 31, 2011 respectively, if recognized would reduce our effective tax rate in the period of recognition. Gross interest and penalty related to unrecognized tax benefit accrued was immaterial as of June 30, 2012 and December 31, 2011.

Recently adopted accounting pronouncements. In May 2011, the Financial Accounting Standards Board (“FASB”) issued ASU 2011-04, Fair Value Measurement, amending the fair value guidance in ASC 820, and thereby achieving substantially converged fair value measurement and disclosure requirements for GAAP and International Financial Reporting Standards (“IFRS”). The new guidance clarified some fair value measurement principles and expanded certain disclosure requirements. We adopted this guidance in the first quarter of 2012 without any impact to our financial position, operating results or cash flows.

Note 2. Net Income Per Share

Basic net income per share is computed by dividing net income for the period by the weighted average number of shares outstanding during the period, less shares subject to repurchase. Diluted net income per share is computed by dividing net income for the period by the weighted average number of shares less shares subject to repurchase plus, if dilutive, potential common stock outstanding during the period. Potential common stock includes the effect of outstanding dilutive stock options, restricted stock awards and restricted stock units computed using the treasury stock method. Since their impact is anti-dilutive, the total number of shares excluded from the calculations of diluted net income per share for the six months ended June 30, 2012 and 2011 were 2,103,021 and 2,085,850, respectively.

The calculation of basic and diluted net income per share is as follows (in thousands, except per share amounts):

	Three Months Ended June 30,				Six Months Ended June 30,
	2012		2011		2012		2011
Basic:
Net income	$	1,375	$	2,587	$	3,726	$	3,257
Weighted average shares outstanding — basic	33,390		33,003		33,377		33,093
Net income per share — basic	$	0.04	$	0.08	$	0.11	$	0.10
Diluted:
Net income	$	1,375	$	2,587	$	3,726	$	3,257
Weighted average shares outstanding — basic	33,390		33,003		33,377		33,093
Add: Dilutive effect of employee stock plans	926		978		952		946
Weighted average shares outstanding — diluted	34,316		33,981		34,329		34,039
Net income per share — diluted	$	0.04	$	0.08	$	0.11	$	0.10

Note 3. Cash and Cash Equivalents, Short-term Investments and Fair Value of Financial Instruments

Cash and cash equivalents and short-term investments consist of the following significant investment asset classes, with disclosure of amortized cost, gross unrealized gains and losses, and fair value as of June 30, 2012 and December 31, 2011 (in thousands):

11

	June 30, 2012
	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value		Cash / Cash Equivalents		Short-term Investments		Security Classification (1)
Cash	$	20,443	$	—	$	—	$	20,443	$	20,443	$	—	N/A
Money market funds	33,628		—		—		33,628		33,628		—		Available for sale
Total cash, cash equivalents and short-term investments	$	54,071	$	—	$	—	$	54,071	$	54,071	$	—

	December 31, 2011
	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value		Cash / Cash Equivalents		Short-term Investments		Security Classification
Cash	$	14,452	$	—	$	—	$	14,452	$	14,452	$	—	N/A
Money market funds	177,310		—		—		177,310		177,310		—		Available for sale
Non-U.S. government securities	8,106		1		—		8,107		—		8,107		Available for sale
Total cash, cash equivalents and short-term investments	$	199,868	$	1	$	—	$	199,869	$	191,762	$	8,107

The money market fund is a daily-traded cash equivalent with the price of $1.00, making it a Level 1 asset class, and its carrying cost closely approximates fair value. As demand deposit (cash) balances vary with the timing of collections and payments, the money market fund can cover any surplus or deficit, and thus is considered Available-for-sale.

The short term investments purchased in September 2011 were comprised of California revenue anticipation notes, which matured in June 2012. As this is the initial investment in a broader portfolio strategy for yield management, these are considered Available-for-sale. The notes were considered a Level 2 asset class, because their pricing is drawn from multiple market-related inputs, but in general not from same-day, same-security trades.

The following table displays the financial assets measured at fair value, on a recurring basis, with money market funds recorded within cash and cash equivalents and non-U.S Government securities in short-term investments (in thousands):

	Quoted Prices in Active Markets for Identical Instruments (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)	Total Fair Value
At June 30, 2012
Money market funds	$	33,628	$	—	—	$	33,628
Total	$	33,628	$	—	—	$	33,628
At December 31, 2011
Money market funds	$	177,310	—		—	$	177,310
Non U.S. Government securities	—		$	8,107	—	8,107
Total	$	177,310	$	8,107	—	$	185,417

Current assets and current liabilities are recorded at amortized cost, which approximates fair value due to the short-term maturities implied.

Note 4. Inventories

Inventories consist of the following (in thousands):

12

	June 30, 2012		December 31, 2011
Raw materials	$	11,310	$	7,666
Work in process	585		14
Finished goods	13,275		10,427
Total	$	25,170	$	18,107

Note 5. Property and Equipment

Property and equipment consist of the following (in thousands):

	June 30, 2012			December 31, 2011
Equipment	$	35,322		$	25,101
Furniture and fixtures	2,256			1,811
Leasehold improvements	4,196			3,692
Purchased software	21,264			20,641
Capital in process	2,391			2,283
	65,429			53,528
Accumulated depreciation and amortization	(36,464		)	(36,222		)
Property and equipment, net	$	28,965		$	17,306

Depreciation and amortization of property and equipment totaled approximately $1.9 million and $1.4 million for the three months ended June 30, 2012 and 2011, respectively. Depreciation and amortization of property and equipment totaled approximately $3.5 million and $2.8 million for the six months ended June 30, 2012 and 2011, respectively.

Note 6. Net Investment in Sales-Type Leases

Our sales-type leases are for terms generally ranging up to five years. Sales-type lease receivables are collateralized by the underlying equipment. The components of our net investment in sales-type leases are as follows (in thousands):

	June 30, 2012		December 31, 2011
Net minimum lease payments to be received	$	15,328	$	15,063
Less unearned interest income portion	1,113		1,229
Net investment in sales-type leases	14,215		13,834
Less current portion(1)	4,389		5,049
Non-current net investment in sales-type leases(2)	$	9,826	$	8,785

(1) A component of other current assets. This amount is net of allowance for doubtful accounts of $0.5 million as of June 30, 2012 and $0.1 million as of December 31, 2011.

(2) Net of allowance for doubtful accounts of $0.1 million as of June 30, 2012 and $0.1 million as of December 31, 2011.

The minimum lease payments under sales-type leases as of June 30, 2012 were as follows (in thousands):

2012 (remaining six months)	$	2,559
2013	4,601
2014	3,512
2015	2,516
2016	1,573
2017	567
Thereafter	—
Total	$	15,328

13

The following table summarizes the credit losses and recorded investment in sales-type leases, excluding unearned interest, as of June 30, 2012 and December 31, 2011 (in thousands):

	Allowance for Credit Losses		Recorded Investment in Sales-type Leases Gross		Recorded Investment in Sales-type Leases Net
Credit loss disclosure for June 30, 2012 :
Accounts individually evaluated for impairment	$	544	$	544	$	—
Accounts collectively evaluated for impairment	115		14,330		14,215
Ending balances: June 30, 2012	$	659	$	14,874	$	14,215
Credit loss disclosure for December 31, 2011 :
Accounts individually evaluated for impairment	$	178	$	178	$	—
Accounts collectively evaluated for impairment	106		13,940		13,834
Ending balances: December 31, 2011	$	284	$	14,118	$	13,834

The following table summarizes the activity for the allowance for credit losses for the investment in sales-type leases for the three months and six months ended June 30, 2012 and 2011 (in thousands):

	Three Months Ended June 30,						Six Months Ended June 30,
	2012			2011			2012			2011
Allowance for credit losses, beginning of period	$	257		$	380		$	284		$	411
Current period provision (reversal)	422			(5		)	422			(9		)
Direct write-downs charged against the allowance	—			—			—			—
Recoveries of amounts previously charged off	(20		)	(22		)	(47		)	(49		)
Allowance for credit losses, end of period	$	659		$	353		$	659		$	353

Note 7. Goodwill and Other Intangible Assets

Under ASC 350, Intangibles - Goodwill and Other, goodwill and intangible assets with an indefinite life are not subject to amortization. Rather, we evaluate these assets for impairment at least annually or more frequently if events or changes in circumstances suggest that the carrying amount may not be recoverable. Historically, there has been no cumulative impairment of goodwill.

Activity in Goodwill by reporting units, which are the same as our operating segments, for the six months ended June 30, 2012 consists of the following (in thousands):

	Goodwill at December 31, 2011		Goodwill acquired		Other adjustments		Goodwill at June 30, 2012
Reporting units:
Acute Care	$	28,543	$	—	$	—	$	28,543
Non-Acute Care	—		84,491		—		84,491
Total	$	28,543	$	84,491	$	—	$	113,034

The goodwill acquired reflects the May 21, 2012 acquisition of MedPak by Omnicell. MedPak is the parent company of MTS, a worldwide provider of medication adherence packaging systems. The acquired goodwill was assigned to the new reporting unit called Non-Acute Care, created as a result of the MTS acquisition.

There were no indefinite-life intangibles at either June 30, 2012 or December 31, 2011. Other finite-life intangible assets at these dates consist of the following (in thousands):

14

	June 30, 2012						December 31, 2011
	Gross				Net		Gross				Net
	Carrying Amount		Accumulated Amortization		Carrying Amount		Carrying Amount		Accumulated Amortization		Carrying Amount		Amortization Life
Finite-lived intangibles:
Customer relationships	$	54,330	$	2,003	$	52,327	$	4,230	$	1,591	$	2,639	5-30 years
Acquired technology	27,580		393		27,187		980		175		805		3-20 years
Patents	1,138		210		928		889		190		699		20 years
Trade name	6,890		115		6,775		90		37		53		3-12 years
Non-compete agreements	60		35		25		60		25		35		3 years
Total finite-lived intangibles	$	89,998	$	2,756	$	87,242	$	6,249	$	2,018	$	4,231

Amortization expense totaled $0.6 million and $0.2 million for the three months ended June 30, 2012 and 2011, respectively. Amortization expense totaled $0.7 million and $0.3 million for the six months ended June 30, 2012 and 2011, respectively. The amortization of acquired technology is included within product cost of sales; other acquired intangibles are usually amortized within selling, general and administrative expenses.

Estimated annual expected amortization expense of the finite-lived intangible assets at June 30, 2012 is as follows (in thousands):

2012 (remaining six months)	$	2,124
2013	4,235
2014	4,195
2015	4,172
2016	3,821
2017	3,786
Thereafter	64,909
Total	$	87,242

Note 8. Accrued Liabilities

Accrued liabilities consist of the following (in thousands):

	June 30, 2012		December 31, 2011
Advance payments from customers	$	2,805	$	3,390
Accrued Group Purchasing Organization (GPO) fees	2,055		2,437
Acquisition consideration payable	1,833		—
Rebates and lease buyouts	1,125		1,748
Taxes payable	527		925
Other	1,611		401
Total	$	9,956	$	8,901

Note 9. Deferred Gross Profit

Deferred gross profit consists of the following (in thousands):

	June 30, 2012			December 31, 2011
Sales of medication and supply dispensing systems and packaging equipment,  which have been delivered and invoiced but not yet installed	$	23,463		$	24,181
Cost of revenues, excluding installation costs	(8,985		)	(9,971		)
Deferred gross profit	$	14,478		$	14,210

15

Note 10. Commitments

At June 30, 2012, the minimum payments under our operating leases for each of the five succeeding fiscal years are as follows (in thousands):

2012 (remaining six months)	$	2,978
2013	5,154
2014	5,272
2015	5,183
2016	4,898
2017	4,206
Thereafter	20,430
Total	$	48,121

Commitments under operating leases relate primarily to leasehold property and office equipment.

 In October 2011, we entered into a lease agreement for approximately 100,000 square feet of office space. Pursuant to the lease agreement, the landlord will construct a single, three-story building of rentable space located at 590 Middlefield Road in Mountain View, California which we will subsequently lease and which will serve as our headquarters. The term of the lease agreement is for a period of 10 years, expected to commence November 2012, with a base lease commitment of approximately $40.0 million. We have two options to extend the term of the lease agreement at market rates. Each extension is for an additional 60 month term.

In March 2012, we entered into a lease agreement for approximately 46,000 square feet of manufacturing, distribution and office space located at 735 Sycamore Drive in Milpitas, California. The term of the lease agreement is for a period of 60 months, expected to commence approximately October 2012, with a base lease commitment of approximately $1.8 million and a single 60 month extension option.

Coincident with the May 21, 2012 acquisition of MTS, we assumed responsibility for its 132,500 square feet of manufacturing, warehousing and office space in St. Petersburg, Florida. The remaining term of the original 12 year lease agreement is through September 30, 2016 with a remaining base lease commitment of approximately $3.9 million. We have two options to extend the term of the lease agreement at market rates. Each extension is for an additional 60 month term.

In Leeds, United Kingdom, MTS leases an office and distribution center. The remaining term of the original 10 year lease agreement is through June 8, 2021, with no extension options. The remaining base lease commitment, converted from British Pounds at the current conversion rate, is approximately $1.2 million. MTS also has smaller rented offices in Strongsville, Ohio and Germany.

We purchase components from a variety of suppliers and use contract manufacturers to provide manufacturing services for our products. During the normal course of business, we issue purchase orders with estimates of our requirements several months ahead of the delivery dates. Our near-term commitments to our contract manufacturers and suppliers totaled $7.3 million as of June 30, 2012.

At June 30, 2012, we have recorded $3.0 million for uncertain tax positions under long term liabilities, in accordance with GAAP, summarized under Note 1, “Organization and Summary of Significant Accounting Policies.” As these liabilities do not reflect actual tax assessments, the timing and amount of payments we might be required to make will depend upon a number of factors. Accordingly, as the timing and amount of payment cannot be estimated, the current balance of the uncertain tax position liabilities has not been included in the table of commitments above.

Note 11. Contingencies

Legal Proceedings    

We may from time to time become involved in certain legal proceedings in the ordinary course of business. We are not a party to any legal proceedings that management believes may have a material impact on Omnicell’s financial position or results of operations.

16

Guarantees

As permitted under Delaware law and our certificate of incorporation and bylaws, we have agreed to indemnify our directors and officers against certain losses that they may suffer by reason of the fact that such persons are, were or become our directors or officers. The term of the indemnification period is for the director’s or officer’s lifetime and there is no limit on the potential amount of future payments that we could be required to make under these indemnification agreements. We have purchased a directors’ and officers’ liability insurance policy that may enable us to recover a portion of any future payments that we may be required to make under these indemnification agreements. Assuming the applicability of coverage and the willingness of the insurer to assume coverage and subject to certain retention, loss limits and other policy provisions, we believe it is unlikely that we will be required to pay any material amounts pursuant to these indemnification obligations. However, no assurances can be given that the insurers will not attempt to dispute the validity, applicability or amount of coverage without expensive and time-consuming litigation against the insurers.

Additionally, we undertake indemnification obligations in our ordinary course of business in connection with, among other things, the licensing of our products and the provision of our support services. In the ordinary course of our business, we have in the past and may in the future agree to indemnify another party, generally our business affiliates or customers, against certain losses suffered or incurred by the indemnified party in connection with various types of claims, which may include, without limitation, claims of intellectual property infringement, certain tax liabilities, our gross negligence or intentional acts in the performance of support services and violations of laws. The term of these indemnification obligations is generally perpetual. In general, we attempt to limit the maximum potential amount of future payments that we may be required to make under these indemnification obligations to the amounts paid to us by a customer, but in some cases the obligation may not be so limited. In addition, we have in the past and may in the future warrant to our customers that our products will conform to functional specifications for a limited period of time following the date of installation (generally not exceeding 30 days) or that our software media is free from material defects. Sales contracts for certain of our medication packaging systems often include limited warranties for up to six months, but the periodic activity and ending warranty balances we record have historically been immaterial.

From time to time, we may also warrant that our professional services will be performed in a good and workmanlike manner or in a professional manner consistent with industry standards. We generally seek to disclaim most warranties, including any implied or statutory warranties such as warranties of merchantability, fitness for a particular purpose, title, quality and non-infringement, as well as any liability with respect to incidental, consequential, special, exemplary, punitive or similar damages. In some states, such disclaimers may not be enforceable. If necessary, we would provide for the estimated cost of product and service warranties based on specific warranty claims and claim history. We have not been subject to any significant claims for such losses and have not incurred any material costs in defending or settling claims related to these indemnification obligations. Accordingly, we believe it is unlikely that we will be required to pay any material amounts pursuant to these indemnification obligations or potential warranty claims and, therefore, no material liabilities have been recorded for such indemnification obligations as of June 30, 2012 or December 31, 2011.

Note 12. Stockholders’ Equity

Treasury Stock

In February 2008, our Board of Directors authorized a stock repurchase program for the repurchase of up to $90.0 million of our common stock. All repurchased shares were recorded as treasury stock and were accounted for under the cost method. No repurchased shares have been retired. The timing, price and volume of the repurchases have been based on market conditions, relevant securities laws and other factors. The stock repurchase program does not obligate us to repurchase any specific number of shares, and we may terminate or suspend the repurchase program at any time.

During the three months ended June 30, 2012, we repurchased 505,137 shares through the stock repurchase program at an average cost of $13.98 per share, including commissions, compared to zero shares repurchased in the three months ended March 31, 2012. We repurchased 218,075 shares through the stock repurchase program in the three months ended June 30, 2011 at an average cost of $15.00 per share, including commissions, and repurchased 559,175 shares at an average cost of $14.31, including commissions, in the six months ended June 30, 2011.

From the inception of the program in February 2008 through June 30, 2012, we have repurchased a total of 5,460,944 shares at an average cost of $15.51 per share through open market purchases. As of June 30, 2012, we had $5.3 million of remaining authorized funds to repurchase additional shares under the stock repurchase program. Please refer to Note 17, “Subsequent Events,” for recent share repurchase activity.

17

Note 13. Stock Option Plans and Share-Based Compensation

Stock Option Plans

At June 30, 2012, a total of 1,881,980 shares of common stock were reserved for future issuance under our 2009 Equity Incentive Plan (the “2009 Plan”). At June 30, 2012, $6.9 million of total unrecognized compensation cost related to non-vested stock options was expected to be recognized over a weighted average period of 2.8 years.

A summary of aggregate option activity for the six months ended June 30, 2012 is presented below:

Options:	Number of Shares		Weighted- Average Exercise Price
	(in thousands)
Outstanding at December 31, 2011	4,693		$	13.36
Granted	390		$	15.28
Exercised	(219	)	$	9.17
Forfeited	(44	)	$	13.23
Expired	(81	)	$	21.65
Outstanding at June 30, 2012	4,739		$	13.57
Exercisable at June 30, 2012	3,565		$	13.46

Restricted Stock and Time-based Restricted Stock Units

The non-employee members of our Board of Directors are granted restricted stock on the day of our annual meeting of stockholders and such shares of restricted stock vest on the date of the subsequent year’s annual meeting of stockholders, provided such non-employee director remains a director on such date. Restricted stock units (“RSUs”) are granted to certain of our employees and generally vest over a period of four years and are expensed ratably on a straight-line basis over the vesting period. The fair value of both restricted stock and RSUs granted pursuant to our stock option plans is the product of the number of shares granted and the grant date fair value of our common stock. Our unrecognized compensation cost related to non-vested restricted stock at June 30, 2012 was approximately $0.8 million and is expected to be recognized over a weighted-average period of 0.9 years. Expected future compensation expense relating to RSUs outstanding on June 30, 2012 is $5.3 million over a weighted-average period of 2.8 years.

A summary of activity of both restricted stock and RSUs for the six months ended June 30, 2012 is presented below:

	Restricted Stock				Restricted Stock Units
			Weighted -				Weighted -
	Number of Shares		Average Grant Date Fair Value Per Share		Number of Shares		Average Grant Date Fair Value Per Share
	(in thousands)				(in thousands)
Non-vested, December 31, 2011	68		$	14.71	287		$	13.03
Granted	67		$	14.19	197		$	14.82
Vested	(68	)	$	14.71	(73	)	$	12.81
Forfeited	—		—		(13	)	$	14.51
Non-vested, June 30, 2012	67		$	14.19	398		$	13.90

Performance-based Restricted Stock Units

In 2011, we began incorporating performance-based restricted stock units (“PSUs”) as an element of our executive compensation plans. Our unrecognized compensation cost related to non-vested performance-based restricted stock units at June 30, 2012 was approximately $1.2 million and is expected to be recognized over a weighted-average period of 1.7 years.

The accounting guidance for awards with market conditions differs from that for awards with service conditions only or service and performance conditions. Because the grant date fair value of an award containing market conditions is calculated

18

as the expected value, averaging over all possible outcomes, the measured expense is amortized over the service period, regardless of whether the market condition is ever actually met. PSU expense of $0.3 million and $0.1 million was recognized for the three months ended June 30, 2012 and 2011, respectively. PSU expense of $0.5 million and $0.3 million was recognized for the six months ended June 30, 2012 and 2011, respectively.

The fair value of a PSU award is the average of trial-specific values of the award over each of one million Monte Carlo trials. Each trial-specific value is the market value of the award at the end of the one-year performance period discounted back to the grant date. The market value of the award for each trial at the end of the performance period is the product of (a) the per share value of Omnicell stock at the end of the performance period and (b) the number of shares that vest. The number of shares that vest at the end of the performance period depends on the percentile ranking of the total shareholder return for Omnicell stock over the performance period relative to the total shareholder return of each of the other companies in the Index as shown in the tables below.

Vesting for the PSU awards is based on the percentile placement of our total shareholder return among the companies listed in the NASDAQ Healthcare Index (the “Index”) and time-based vesting. We calculate total stockholder return based on the one year annualized rates of return reflecting price appreciation plus reinvestment of dividends. Stock price appreciation is calculated based on the average closing prices of the applicable company’s common stock for the 20 trading days ending on the last trading day of the year prior to the date of grant as compared to the average closing prices for the 20 trading days ended on the last trading day of the year of grant.

The following table shows the percent of PSUs granted in 2011 eligible for further time-based vesting based on our percentile placement:

Percentile Placement of Our Total Shareholder Return	% of PSUs Eligible for Time- Based Vesting
Below the 35th percentile	—%
At least the 35th percentile, but below the 50th percentile	50%
At least the 50th percentile, but below the 65th percentile	100%
At least the 65th percentile, but below the 75th percentile (1)	110% to 119%
At or above the 75th percentile	120%

(1)The actual percentage of PSUs eligible for further time-based vesting is based on straight-line interpolation, where, for example, if the ranking is the 70th percentile, then the vesting percentage is 115%.

On January 17, 2012, the Compensation Committee of our Board of Directors confirmed 76.3% as the percentile rank of Omnicell’s 2011 total stockholder return. This resulted in 120% of the 2011 PSU awards, or 120,000 shares, becoming eligible for further time-based vesting. The eligible PSU awards will vest as follows: 25% of the eligible awards for the first year vested immediately on January 17, 2012 with the remaining eligible awards vesting in equal increments, semi-annually, over the subsequent 36 month period beginning on June 15th and December 15th of the year after the date of grant and each subsequent year. Vesting is contingent upon continued service.

The following table shows the percent of PSUs granted in 2012 eligible for further time-based vesting based on our percentile placement:

Percentile Placement of Our Total Shareholder Return	% of PSUs Eligible for Time- Based Vesting
Below the 35th percentile	—%
At least the 35th percentile, but below the 50th percentile	50%
At least the 50th percentile	100%

After the last trading day of 2012, the Compensation Committee of our Board of Directors will determine the percentile rank of Omnicell’s total stockholder return and the number of performance-based restricted stock unit awards eligible for further time-based vesting. The eligible performance-based restricted stock unit awards will vest as follows: 25% of the shares on the date of the Compensation Committee of our Board of Directors meeting in 2013 when the Committee reviews the performance-based metrics and determines if they were met or not, with the remaining shares vesting on a semi-annual

19

basis over a period of 36 months commencing on June 15, 2013 if Omnicell meets certain stock performance objectives compared to the Index. The actual number of shares that vest may be 0% to 100% of the numbers reflected above, depending upon Omnicell’s performance. Vesting is contingent upon continued service.

During the six months ended June 30, 2012, in addition to the 125,000 PSUs granted in 2012, an additional 7,500 PSUs vested as a result of Omnicell’s 2011 total stockholder return which caused 120% of the 2011 PSUs to become eligible for further time-based vesting.

A summary of activity of the PSUs for the six months ended June 30, 2012 is presented below:

			Weighted - Average Grant Date Fair Value Per
Performance-based Stock Units	Number of Shares		Share
	(in thousands)
Non-vested, December 31, 2011	100		$	11.15
Granted	133		$	10.94
Vested	(45	)	$	11.15
Forfeited	—		—
Non-vested, June 30, 2012	188		$	11.00

Employee Stock Purchase Plan

We have an Employee Stock Purchase Plan (“ESPP”), under which employees can purchase shares of our common stock based on a percentage of their compensation, but not greater than 15% of their earnings, up to a maximum of $25,000 of fair value per year. The purchase price per share must be equal to the lower of 85% of the fair value of the common stock at the beginning of a 24-month offering period or the end of each six-month purchasing period. As of June 30, 2012, 3,602,826 shares had been issued under the ESPP. As of June 30, 2012 there were a total of 1,728,729 shares reserved for future issuance under the ESPP. For the three months and six months ended June 30, 2012, no shares and 197,831 shares, respectively, of common stock were purchased under the ESPP.

Share-based Compensation

We account for share-based awards granted to employees and directors, including employee stock option awards, restricted stock, PSUs and RSUs issued pursuant to the 2009 Plan and employee stock purchases made under our ESPP using the estimated grant date fair value method of accounting in accordance with ASC 718, Stock Compensation. We value options and ESPP shares using the Black-Scholes-Merton option-pricing model. Restricted stock and time-based RSUs are valued at the grant date fair value of the underlying common shares. The PSUs are valued via Monte Carlo simulation, as described above.

The impact on our results for share-based compensation for the three months and six months ended June 30, 2012 and 2011 was as follows (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2012		2011		2012		2011
Cost of product and service revenues	$	233	$	383	$	501	$	750
Research and development expenses	211		345		454		672
Selling, general and administrative expenses	1,769		1,723		3,465		3,421
Total share-based compensation expenses	$	2,213	$	2,451	$	4,420	$	4,843

Note 14. Business Acquisition

On May 21, 2012, Omnicell, completed its merger with MedPak Holdings, Inc. (“MedPak”) pursuant to an Agreement and Plan of Merger (the “Merger Agreement”) under which Mercury Acquisition Corp, a newly formed Omnicell subsidiary, was merged with and into MedPak, with MedPak surviving the merger as a wholly-owned subsidiary of Omnicell. MedPak is the parent company of MTS Medication Technologies, Inc.

20

Pursuant to the terms of the Merger Agreement, Omnicell paid approximately $158.3 million in cash after adjustments provided for in the Merger Agreement, of which approximately $13.5 million was placed in an escrow fund, which will ultimately be distributed to MedPak's stockholders (subject to claims that Omnicell may make against the escrow fund for indemnification and other claims following the closing). Omnicell has accrued a $1.8 million liability as of June 30, 2012, based on additional estimated working capital adjustments as provided under the Merger Agreement.

The MTS acquisition primarily was to align the Company with the long term trends of the healthcare market to manage the health of patients across the continuum of care. We can now better serve both the acute care and non-acute care markets. Omnicell and MTS bring capabilities to each other that strengthen the product lines and expand the medication management coverage of both companies.

Omnicell is accounting for the transaction under the acquisition method of accounting in accordance with the provisions of FASB ASC Topic 805, Business Combinations. Under the acquisition method, the estimated fair value of the consideration transferred to purchase the acquired company is allocated to the assets acquired and the liabilities assumed based on their fair values. Omnicell has made significant estimates and assumptions in determining the allocation of the acquisition consideration. The acquisition consideration of $160.1 million is comprised of $158.3 million in cash at closing plus an estimated $1.8 million net working capital adjustment recorded in accrued liabilities, subject to review by the seller and possible adjustment.

The total consideration, and the allocation of consideration to the individual net assets is considered preliminary, as there are remaining uncertainties to be resolved, including the settlement of the final net working capital adjustment and the completion of an analysis of potential contingent payroll tax withholding obligations.

The total acquisition price was approximately $160.1 million and the preliminary acquisition price allocation was comprised of the following (in thousands):

	Fair value acquired
Cash including restricted cash	$	2,000
Accounts receivable	7,403
Inventory	11,726
Deferred tax assets and other current assets	2,864
Total current assets	23,993
Property and equipment	11,088
Intangibles	83,500
Goodwill	84,491
Other non-current assets	244
Total assets	203,316
Current liabilities	(8,046		)
Non-current deferred tax liabilities	(33,898		)
Other non-current liabilities	(1,227		)
Net assets acquired	$	160,145
Cash consideration, fair value	$	160,145

Accounts receivable is presented at its fair value, comprised of total contractual obligations due of $7.6 million of which $0.2 million is not expected to be collected. Based on an acquisition date valuation, the estimated fair values of acquired inventory and property and equipment exceeded their historical carrying values.

Identifiable intangible assets. Acquired technology relates to MTS’ products across all of its product lines that have reached technological feasibility, primarily the OnDemand technology. Trade name is primarily related to the MTS and OnDemand brand names. Customer relationships represent existing contracted relationships with pharmacies, institutional care facilities and others. Acquired technology, customer relationships, and trade names will be amortized on a straight-line basis over their estimated useful lives, which range from 12 to 30 years.

The estimated fair values of the acquired technology, trade names and customer relationships were primarily

21

determined using either the relief-from-royalty or excess earnings methods. The interest rates utilized to discount net cash flows to their present values were determined after consideration of the overall enterprise rate of return and the relative risk and importance of the assets to the generation of future cash flows.

For income tax purposes, the historical tax bases of the acquired assets and assumed liabilities, along with the tax attributes of the MTS companies, will carryover. Because the transaction was a cash for stock transaction, there is no tax basis in the newly acquired intangible assets. Accordingly, the acquisition accounting includes the establishment of net deferred tax liabilities of $33.9 million, resulting from book tax basis differences related to the intangible assets acquired, as well as to the step up in the value of fixed assets and inventory to their estimated fair values at the time of acquisition.

Goodwill. Approximately $84.5 million has been allocated to goodwill. Goodwill represents the excess of the fair value of the consideration transferred over the fair value of the underlying net tangible and identifiable intangible assets on the acquisition date. In accordance with ASC Topic 350, Intangibles - Goodwill and Other, goodwill will not be amortized, but instead will be tested for impairment at least annually or more frequently if certain indicators are present. In the event our management determines that the value of goodwill has become impaired, we will incur an accounting charge for the amount of impairment during the quarter in which the determination is made. We believe the MTS acquisition enhances Omnicell’s offerings and diversifies its revenue mix providing a more robust product and service solution to its current customers while expanding Omnicell’s international presence. Omnicell considers these factors as supporting the amount of goodwill recorded.

Details of acquired intangibles are as follows (in thousands, except for years):

	Fair value acquired		Useful Life (years)	First year amortization expense
Trade name	$	6,800	12	$	567
Customer relationships	50,100		28 to 30	1,693
Acquired technology	26,600		20	1,330
Intangibles acquired	$	83,500		$	3,590
Weighted avg. life of intangibles			25.11

For the three months ended June 30, 2012, Omnicell incurred approximately $3.2 million in acquisition related costs related to the MTS acquisition. These costs are included in selling, general and administrative expenses on Omnicell’s Condensed Consolidated Statement of Operations.

During the three months ended June 30, 2012, the acquired MTS operations (consolidated since the May 21, 2012 acquisition date) generated approximately $8.9 million of revenue and a net loss of $1.5 million.    

The following represents unaudited pro forma revenue and net income as if MTS had been included in our consolidated results from January 1, 2011 (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2012		2011		2012		2011
Revenues	$	85,204	$	80,798	$	168,270	$	157,247
Net income	$	4,110	$	3,874	$	6,595	$	6,056

The pro forma unaudited condensed consolidated operating results presented above were calculated after applying the Company's accounting policies and by adding together the historical operating statements of MTS and Omnicell, with certain adjustments, assuming an acquisition date of January 1, 2011. The adjustments include replacement of MTS historical depreciation and amortization expense with acquisition-accounting depreciation and amortization expense, based on the estimated fair values and useful lives determined from the allocation of total MTS acquisition consideration. Also reflected is the interest expense elimination effect of MTS on its debt (since it would have been paid off at acquisition) and the elimination of certain management fees to an affiliated party, offset in part by interest income foregone by Omnicell, by no longer having the acquisition consideration available as interest-bearing cash, cash equivalents and short-term investments.

The pro forma operating results do not include actual acquisition-related expenses by MTS and Omnicell as such amounts are considered nonrecurring. The total of all adjustments were tax effected using an estimated federal and state

22

effective income tax rate.

The pro forma operating results do not include any assumption of operating synergies for the combined companies. These pro forma results are provided as required disclosures and should not be considered as a forecast for any future period, nor as representing what the actual operating results would have been if the acquisition, in fact, had occurred on January 1, 2011.

Note 15. Segments

Beginning with the May 21, 2012 acquisition of MTS, we have organized our business into two operating business segments: Acute Care, which primarily includes products and services sold to hospital customers and Non-Acute Care, which primarily includes products and services sold to customers outside of hospital settings.

The Acute Care segment is organized around the design, manufacturing, selling and servicing of medication and supply dispensing systems. The Non-Acute Care segment includes primarily the manufacturing and selling of consumable medication blister cards, packaging equipment and ancillary products and services. We report segment information based on the management approach. The management approach designates the internal reporting used by the Chief Operating Decision Maker (“CODM”), for making decisions and assessing performance as the source of our operating segments. The CODM is our Chief Executive Officer. The CODM allocates resources to and assesses the performance of each operating segment using information about its revenues, gross profit and income (loss) from operations.

Since 1992, Omnicell has provided automation and business information solutions to acute care hospitals. We have developed product solutions that help optimize various workflows utilized in hospitals. We have also developed sophisticated sales, installation, and service capabilities to serve the specific and special needs of the acute care environment in hospitals. As the acute care market evolves, we see opportunities to provide medication adherence solutions, which were added to our product line through the acquisition of MTS, to the acute care market as well. A portion of our organization structure and management processes will continue to be structured to optimize sales and service of solutions to the acute care market.

Since 1984, MTS has provided medication adherence solutions to the non-acute care market. These solutions provide automated and semi-automated equipment to assist institutional and retail pharmacists in filling medication orders into blister cards, the primary method of medication control in non-acute care settings. Completing the product solution are the consumables used by institutional and retail pharmacists to make the medication adherence package. MTS has developed process manufacturing capabilities as well as sales capabilities to market medication adherence solutions to institutional and retail pharmacies. A portion of our organization structure and management processes will continue to be structured to optimize the product, sales, and service of solutions to the non-acute care market.

We believe that legislative changes and economic pressures to manage costs will cause healthcare organizations to manage the health of patients across the continuum of care regardless of the setting in which the care is provided. We believe we have the capabilities and market position to provide the tools needed by our customers to manage medications across the continuum of care. But we also believe that the inherent differences between medication management workflows in acute care settings and non-acute care settings will cause our product solutions and marketing strategies to be managed separately for these two customer segments.

For the three months and six months ended June 30, 2012 and 2011, the contributions of our segments to net revenues and income (loss) from operations, and the reconciliation to total net income, is as follows (amounts in thousands):

23

	Three Months Ended June 30,									Three Months Ended June 30,
	2012									2011
	Acute Care			Non-Acute Care (1)			Total			Acute Care			Total
Net revenues from external customers	$	66,528		$	8,856		$	75,384		$	61,005		$	61,005
Cost of revenues	29,158			6,850			36,008			27,198			27,198
Gross profit	$	37,370		$	2,006		$	39,376		$	33,807		$	33,807
Gross margin %	56.2		%	22.7		%	52.2		%	55.4		%	55.4		%
Operating expenses	33,458			3,487			36,945			29,577			29,577
Income from operations	$	3,912		$	(1,481	)	$	2,431		$	4,230		$	4,230
Operating margin %	5.9		%	(16.7		)%	3.2		%	6.9		%	6.9		%
Interest and other income (expense), net							(73		)				71
Income before provision for income taxes							2,358						4,301
Provision for income taxes							983						1,714
Net income							$	1,375					$	2,587
(1) Non-Acute Care segment included from the May 21, 2012 acquisition of MTS

	Six Months Ended June 30,									Six Months Ended June 30,
	2012									2011
	Acute Care			Non-Acute Care (1)			Total			Acute Care			Total
Net revenues from external customers	$	130,671		$	8,856		$	139,527		$	118,165		$	118,165
Cost of revenues	57,552			6,850			64,402			52,708			52,708
Gross profit	$	73,119		$	2,006		$	75,125		$	65,457		$	65,457
Gross margin %	56.0		%	22.7		%	53.8		%	55.4		%	55.4		%
Operating expenses	65,572			3,487			69,059			60,198			60,198
Income from operations	$	7,547		$	(1,481	)	$	6,066		$	5,259		$	5,259
Operating margin %	5.8		%	(16.7		)%	4.3		%	4.5		%	4.5		%
Interest and other income (expense), net							23						125
Income before provision for income taxes							6,089						5,384
Provision for income taxes							2,363						2,127
Net income							$	3,726					$	3,257
(1) Non-Acute Care segment included from the May 21, 2012 acquisition of MTS

For the three months and the six months ended June 30, 2012, the Non-Acute Care cost of revenues included $1.7 million of acquisition-related charges primarily associated with the step-up to the estimated fair value of inventory acquired from MTS and consumed in the normal manufacturing cycle of our business. The Non-Acute Care operating expenses included $0.9 million of acquisition-related charges primarily associated with severance expenses. For the three months and the six months ended June 30, 2012, the Acute Care operating expenses included $2.3 million of acquisition-related charges for transaction costs, required to be expensed under ASC 805 Business Combinations.

24

As of June 30, 2012 we have not assigned assets to our operating segments.

Note 16. Risk Management and Derivatives

We are exposed to global market risks, including the effect of changes in foreign currency exchange rates. We use derivatives to manage financial exposures that occur in the normal course of business but do not hold or issue derivatives for trading purposes.

Cash Flow Hedges

The purpose of our foreign currency hedging activities is to protect our business from the risk that the eventual cash flows resulting from transactions in foreign currencies, primarily product costs manufactured in the U.S. and sold to foreign subsidiaries in U.S. dollars and other intercompany transactions, including intercompany borrowings, will be adversely affected by changes in exchange rates. Our policy is to utilize derivatives to reduce foreign exchange risks where internal netting strategies cannot be effectively employed.

Results of hedges of anticipated intercompany transactions are recorded in other (income) expense, net when the transaction occurs. Hedges of recorded balance sheet positions are recorded in other (income) expense, net currently together with the transaction gain or loss from the hedged balance sheet position. Net foreign currency transaction gains and losses, were immaterial for the six months ended June 30, 2012 and 2011, respectively.

 As of June 30, 2012, an immaterial amount of deferred net gains (net of tax) on both outstanding and matured derivatives accumulated in other comprehensive income is expected to be reclassified to net income during the next 12 months as a result of underlying hedged transactions also being recorded in net income. Actual amounts ultimately reclassified to net income are dependent on the exchange rates in effect when derivative contracts that are currently outstanding mature. As of June 30, 2012, the maximum term over which we are hedging exposures to the variability of cash flows for our forecast transactions is three months.

Note 17. Subsequent Events

Treasury Stock Repurchase

In 2008, our Board of Directors established the “2008 Repurchase Program,” authorizing share repurchases of $90.0 million. Subsequent to June 30, 2012, we have continued with share repurchases. Through the date of this filing, $1.1 million remains authorized for future share repurchases due to 314,100 shares repurchased since June 30, 2012, at an average cost of $13.39 per share, including commissions.

On August 1, 2012, our Board of Directors established a new “2012 Repurchase Program”, authorizing share repurchases of $50.0 million, with no termination date. The timing, price and volume of repurchases will be based on market conditions, relevant securities laws and other factors. The stock repurchases may be made from time to time on the open market, in privately negotiated transactions or pursuant to a Rule 10b-18 plan. The stock repurchase program does not obligate the Company to repurchase any specific number of shares, and the Company may terminate or suspend the repurchase program at any time.

25

Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Forward-Looking Statements

This Quarterly Report on Form 10-Q contains forward-looking statements. The forward looking statements are contained principally in the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” These statements involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements to be materially different from any future results, performances or achievements expressed or implied by the forward-looking statements. Forward-looking statements include, but are not limited to, statements about:

• the extent and timing of future revenues, including the amounts of our current backlog, which represent firm orders that have not completed installation and therefore have not been recognized as revenue;

• our ability to conduct acquisitions for strategic value, including our acquisition of MTS, and successfully integrate each one into our operations;

• the size and/or growth of our market or market-share;

• the opportunity presented by new products or emerging markets;

• our expectations regarding our future backlog levels;

• the operating margins or earnings per share goals we may set;

• our ability to align our cost structure and headcount with our current business expectations;

• our ability to protect our intellectual property and operate our business without infringing upon the intellectual property rights of others; and

• our ability to generate cash from operations and our estimates regarding the sufficiency of our cash resources.

In some cases, you can identify forward-looking statements by terms such as “anticipates,” “believes,” “could,” “estimates,” “expects,” “intends,” “may,” “plans,” “potential,” “predicts,” “will,” “would” and similar expressions intended to identify forward-looking statements. Forward-looking statements reflect our current views with respect to future events, are based on assumptions, and are subject to risks and uncertainties. We discuss many of these risks in this Quarterly Report on Form 10-Q in greater detail in Part II — Section 1A. “Risk Factors” below.  Given these uncertainties, you should not place undue reliance on these forward-looking statements. Also, forward-looking statements represent our estimates and assumptions only as of the date of this Quarterly Report on Form 10-Q.  You should also read our Annual Report on Form 10-K and the documents that we reference in the Annual Report on Form 10-K and have filed as exhibits, completely and with the understanding that our actual future results may be materially different from what we expect.  All references in this report to “Omnicell, Inc.,” “Omnicell,” “our,” “us,” “we” or the “Company” collectively refer to Omnicell, Inc., a Delaware corporation, and its subsidiaries.

Except as required by law, we assume no obligation to update any forward-looking statements publicly, or to update the reasons actual results could differ materially from those anticipated in any forward-looking statements, even if new information becomes available in the future.

Overview

We were incorporated in California in 1992 under the name Omnicell Technologies, Inc. and reincorporated in Delaware in 2001 as Omnicell, Inc. We are a leading provider of automated solutions for medication and supply management in healthcare. Our automation and analytics solutions are designed to enable healthcare facilities to acquire, manage, dispense and administer medications and medical-surgical supplies and are intended to enhance patient safety, reduce medication errors, reduce operating costs, improve workflow and increase operational efficiency. Approximately 2,600 hospitals utilize one or more of our products, of which more than 1,600 hospitals in the United States have installed our automated hardware/software solutions for controlling, dispensing, acquiring, verifying, tracking and analyzing medications and medical and surgical supplies. Approximately 6,000 institutional and retail pharmacies utilize our medication adherence packaging solutions.

We sell our medication control systems together with related consumables and services, and medical/surgical supply control systems and generate the majority of our revenue in the United States. However, we expect our revenue from our international operations to increase in future periods as we continue to grow our international business. Our sales force is organized by geographic region in the United States and Canada, and for a portion of our products in the United Kingdom and Germany. We also sell through distributors in Asia, Australia, Europe, the Middle East and South America. We have not sold in the past, and have no future plans to sell our products either directly or indirectly to customers located in countries that are

26

identified as state sponsors of terrorism by the U.S. Department of State, and are subject to economic sanctions and export controls.

Business Acquisition

On May 21, 2012, we completed our acquisition of MedPak pursuant to the Merger Agreement for $158.3 million in cash, subject to certain adjustments, and including $13.5 million in cash that was placed in an escrow fund at the closing of the transaction. Under the terms of the Merger Agreement, Merger Sub, a newly formed Omnicell subsidiary, was merged with and into MedPak, with MedPak surviving the merger as a wholly-owned subsidiary of Omnicell. MedPak is the parent company of MTS, a worldwide provider of medication adherence packaging systems and solutions. MTS primarily manufactures and sells consumable medication blister cards, packaging equipment and ancillary products throughout the United States, Canada, Europe and Australia. Its customers are predominantly institutional pharmacies that supply nursing homes, assisted living and correctional facilities with prescription medications for their patients. MTS manufactures its proprietary consumable blister cards and most of its packaging equipment in its own facilities. This manufacturing process uses integrated equipment for manufacturing the consumable medication blister cards. In addition, MTS utilizes the services of outside contract manufacturers for some of its packaging equipment. The consumable medication blister cards and packaging equipment are designed to provide a cost-effective method for pharmacies to dispense medications. MTS’ medication dispensing systems and products provide innovative methods for dispensing medications in disposable packages. MTS Limited distributes products for MTS primarily in the United Kingdom. MTS GmbH distributes products for MTS in Germany. MTS currently serves more than 6,000 institutional pharmacies in the long-term care and correctional markets, both domestically and internationally.

With the acquisition of MTS, we organized our business into two operating business segments: Acute Care and Non-Acute Care. The Acute Care segment is organized around the design, manufacturing, selling and servicing of medication and supply dispensing systems. The Non-Acute Care segment includes primarily the manufacturing and selling of consumable medication blister cards, packaging equipment and ancillary products. We report segment information based on the management approach. The management approach designates the internal reporting used by the Chief Operating Decision Maker (“CODM”), for making decisions and assessing performance as the source of our operating segments. The CODM is our Chief Executive Officer. The CODM allocates resources to and assesses the performance of each operating segment using information about its revenues, gross profit and income (loss) from operations.

Operations During the Three Months and Six Months Ended June 30, 2012

The consolidated results presented for the three months and six months ended June 30, 2012 reflect the impact of the Non-Acute Care segment since the May 21, 2012 acquisition of MTS.

Revenues grew year-over-year for both product and services, with overall revenue growth of 23.6%, comparing $75.4 million for the second quarter of 2012 with $61.0 million for the second quarter of 2011. Overall revenue growth was 18.1% for the six month period ending June 30, 2012, comparing $139.5 million with $118.2 million for the same period in 2011. Overall revenue growth attributable to the newly acquired Non-Acute Care segment was $8.9 million, for the three months and six months ended June 30, 2012.

Product revenue growth is primarily reflective of overall increased installations as allowed for by our customers’ schedules, while service revenue growth reflects a growing installed base. Additionally, Non-Acute Care since the date of the acquisition of MTS, contributed $8.6 million and $0.3 million to the overall product and service revenue growth, respectively. Overall product and service margins increased by $5.6 million, or 16.5% for the three months ended June 30, 2012 as compared to the same period in 2011. Product and service margins increased by $9.7 million, or 14.8% for the six months ended June 30, 2012 as compared to the same period in 2011.

We believe our solutions are attractive relative to our competition. In particular:

• We have continued to differentiate ourselves through a strategy intended to create the best customer experience in healthcare;

• We have delivered industry-leading products with differentiated product features that are designed to appeal to nurses and pharmacists, such as our G4 platform, the Savvy^TM Mobile Medication System, SinglePointe^TM, Anywhere RN^TM and OnDemand;

• Through acquisitions, we have broadened our medication control product line to address the growing need for medication management across the continuum of care beyond hospitals; and

27

• The market environment of increased patient safety awareness and increased regulatory control has driven our solutions to be a high priority in customers’ capital budgets.

We maintain a development staff with expertise in hospital logistics, pharmacy operations and computerized automated solutions, which allows us to deliver new innovations to the market. Our ability to grow revenue and maintain positive cash flow is dependent on our ability to obtain orders from customers, our ability to manufacture consumables to customer demand, the volume of installations we are able to complete, our ability to meet customers’ needs while providing a quality installation experience and our flexibility in manpower allocations among customers to complete installations on a timely basis.

During the second quarter of 2012, we achieved 17.5% growth in total revenues from the first quarter of 2012, inclusive of the aforementioned Non-Acute Care contribution. Product revenue increased by $10.7 million, or 22.1%, while service revenue increased by $0.5 million, or 3.2%. Overall gross margins for the second quarter of 2012 declined to 52.2% from 55.7% in the first quarter of 2012. Product gross margins declined to 51.7% on revenue of $59.3 million as compared with 58.2% on revenue of $48.5 million in the first quarter of 2012. Service gross margins increased to 54.0% on revenue of $16.1 million as compared to 48.2% margins on $15.6 million in revenue in the first quarter of 2012. The overall decrease in gross margins is primarily attributable to Non-Acute Care activity which has lower margins, coupled with product mix in the Acute Care segment.

Cash, cash equivalents and short-term investments decreased by $145.8 million during the six months ended June 30, 2012 to $54.1 million from $199.9 million at December 31, 2011. During the quarter ended June 30, 2012, we expended $159.2 million for the acquisition of MTS and related transaction costs, and $7.1 million to repurchase 505,137 shares of our common stock through our stock repurchase program. These expenditures were partially offset by $18.8 million in quarterly operating cash flow reflecting improved net income and a decline in Acute Care inventories.

Critical Accounting Policies and Estimates

Our discussion and analysis of our financial condition and results of operations are based on our consolidated financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of these financial statements requires us to make certain estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of any contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. We regularly review our estimates and assumptions, which are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of certain assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates and assumptions. We believe that the following critical accounting policies are affected by significant judgments and estimates used in the preparation of our condensed consolidated financial statements:

•Revenue recognition;

•Provision for allowances;

•Valuation and impairment of goodwill, other intangible assets and other long lived assets;

•Inventory;

•Valuation of share-based awards; and

•Accounting for income taxes.

During the six months ended June 30, 2012, there were no significant changes in our critical accounting policies and estimates.

Please refer to Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in Part II, Item 7 of our Annual Report on Form 10-K for our fiscal year ended December 31, 2011 for a more complete discussion of our other critical accounting policies and estimates.

Recently Adopted Accounting Pronouncements

In May 2011, the FASB issued ASU 2011-04, Fair Value Measurement, amending the fair value guidance in ASC 820, and thereby achieving substantially converged fair value measurement and disclosure requirements for GAAP and IFRS. The new guidance clarified some fair value measurement principles and expanded certain disclosure requirements. We adopted this guidance in the first quarter of 2012, without any impact to our financial position, operating results or cash flows.

28

Results of Operations

The table below shows the components of our results of operations as percentages of total revenues for the three months and six months ended June 30, 2012 and 2011 (in thousands, except percentages):

	Three Months Ended June 30,									Six Months Ended June 30,
	2012					2011				2012				2011
	$			% of Revenue		$		% of Revenue		$		% of Revenue		$		% of Revenue
Revenues:
Product revenue	$	59,269		78.6	%	$	46,218	75.8	%	$	107,793	77.3	%	$	88,793	75.1	%
Service and other revenues	16,115			21.4	%	14,787		24.2	%	31,734		22.7	%	29,372		24.9	%
Total revenues	75,384			100.0	%	61,005		100.0	%	139,527		100.0	%	118,165		100.0	%
Cost of revenues:
Cost of product revenues	28,600			38.0	%	19,730		32.4	%	48,896		35.0	%	37,566		31.8	%
Cost of service and other revenues	7,408			9.8	%	7,468		12.2	%	15,506		11.1	%	15,142		12.8	%
Total cost of revenues	36,008			47.8	%	27,198		44.6	%	64,402		46.1	%	52,708		44.6	%
Gross profit	39,376			52.2	%	33,807		55.4	%	75,125		53.9	%	65,457		55.4	%
Operating expenses:
Research and development	5,499			7.3	%	5,280		8.7	%	11,993		8.6	%	10,120		8.5	%
Selling, general and administrative	31,446			41.7	%	24,297		39.8	%	57,066		40.9	%	50,078		42.4	%
Total operating expenses	36,945			49.0	%	29,577		48.5	%	69,059		49.5	%	60,198		50.9	%
Income from operations	2,431			3.2	%	4,230		6.9	%	6,066		4.4	%	5,259		4.5	%
Interest and other income (expense), net	(73		)	(0.1	)%	71		0.1	%	23		—		125		0.1	%
Income before provision for income taxes	2,358			3.1	%	4,301		7.0	%	6,089		4.4	%	5,384		4.6	%
Provision for income taxes	983			1.3	%	1,714		2.8	%	2,363		1.7	%	2,127		1.8	%
Net income	$	1,375		1.8	%	$	2,587	4.2	%	$	3,726	2.7	%	$	3,257	2.8	%

The table above and the ensuing financial information and discussions presented include Non-Acute Care results since the May 21, 2012 acquisition of MTS.

Product Revenues, Cost of Product Revenues and Gross Profit

The table below shows our product revenues, cost of product revenues and gross profit for the three months and six months ended June 30, 2012 and 2011 and the percentage changes between those periods (in thousands, except percentages):

	Three Months Ended June 30,								Six Months Ended June 30,
	2012			2011			% Change		2012			2011			% Change
Product revenues	$	59,269		$	46,218		28.2	%	$	107,793		$	88,793		21.4	%
Cost of product revenues	28,600			19,730			45.0	%	48,896			37,566			30.2	%
Gross profit	$	30,669		$	26,488		15.8	%	$	58,897		$	51,227		15.0	%
Gross margin	51.7		%	57.3		%			54.6		%	57.7		%

Product revenues increased by $13.1 million, or 28.2%, in the three months ended June 30, 2012 as compared to the same period in 2011. Product revenues increased by $19.0 million, or 21.4%, in the six months ended June 30, 2012 as compared to the same period in 2011. Our ability to grow revenue is dependent on our ability to continue to obtain orders from customers, our ability to produce consumables to customer demand, the volume of installations we are able to complete, our ability to meet customer needs by providing a quality installation experience and our flexibility in manpower allocations among

29

customers to complete installations on a timely basis. The timing of our product revenues for equipment is primarily dependent on when our customers’ schedules allow for installations. The overall increase in product revenues was driven by a combination of increased installations of our new automation products, increases in lease renewals from existing customers and the contribution of $8.5 million from MTS products in our Non-Acute Care segment since acquisition May 21, 2012. We anticipate our revenues will continue to increase in 2012. We expect growth in our Acute Care products segment of approximately 7.0% to 8.0%, year over year, as we fulfill our existing orders and as we experience an anticipated continued high volume of lease renewals. Additionally, year over year revenue growth for the remainder of 2012 will be impacted by the results from the Non-Acute Care segment that we did not have in 2011.

Cost of product revenues increased by $8.9 million, or 45.0%, in the three months ended June 30, 2012 as compared to the same period in 2011. Cost of product revenues increased by $11.3 million, or 30.2%, in the six months ended June 30, 2012 as compared to the same period in 2011. This increase was primarily a function of Acute Care revenue growth in addition to $6.7 million of Non-Acute Care product costs incurred since May 21, 2012 and included in both the three months and six months ended June 30, 2012. The Non-Acute Care product costs included $1.6 million of acquisition related charges associated with the step-up to the estimated fair value of inventory acquired from MTS and consumed in the normal manufacturing cycle of our business, and $0.1 million for severance expenses related to staff realignment.

Gross profit on product revenue increased by $4.2 million, or 15.8%, in the three months ended June 30, 2012 as compared to the same period in 2011. Gross profit on product revenue increased by $7.7 million, or 15.0%, in the six months ended June 30, 2012 as compared to the same period in 2011. This increase was primarily a result of the aforementioned increases in product revenue, together with relatively comparable increases in product costs to support this revenue growth. Gross profit on product revenue as a percentage of total product revenue decreased for both the three months and six months ended June 30, 2012, as compared to the corresponding prior year period primarily due to the lower margins on our Non-Acute Care product revenues, the step up of inventory valuation, and other charges associated with the acquisition of MTS that are not expected to reoccur.

We anticipate lower overall gross profit on product sales as a percentage of total product sales in the third quarter of 2012 and subsequent quarters, as we record a full quarter of Non-Acute Care revenues which carry lower gross margins than our Acute Care segment.

Service and Other Revenues, Cost of Service and Other Revenues and Gross Profit

The table below shows our service and other revenues, cost of service and other revenues and gross profit for the three months and six months ended June 30, 2012 and 2011 and the percentage change between those periods (in thousands, except percentages):

	Three Months Ended June 30,								Six Months Ended June 30,
	2012			2011			% Change		2012			2011			% Change
Service and other revenues	$	16,115		$	14,787		9.0	%	$	31,734		$	29,372		8.0	%
Cost of service and other revenues	7,408			7,468			(0.8	)%	15,506			15,142			2.4	%
Gross profit	$	8,707		$	7,319		19.0	%	$	16,228		$	14,230		14.0	%
Gross margin	54.0		%	49.5		%			51.1		%	48.4		%

Service and other revenues include revenues from service and maintenance contracts, rentals of automation systems, training and professional services. Service and other revenues increased by $1.3 million, or 9.0%, in the three months ended June 30, 2012 as compared to the same period in 2011. Service and other revenues increased by $2.4 million, or 8.0%, in the six months ended June 30, 2012 as compared to the same period in 2011. The increase in service and other revenues was primarily the result of an expansion in our installed base of automation systems and a resulting increase in the number of support service contracts, continued growth in analytical software, higher training revenues and $0.3 million of service revenues attributable to MTS.

Cost of service and other revenues were flat, in the three months ended June 30, 2012 as compared to the same period in 2011 and increased by $0.4 million, or 2.4%, in the six months ended June 30, 2012 as compared to the same period in 2011. The increase was primarily due to an increase in spending of approximately $0.2 million related to salaries, benefits and other costs associated with higher headcount in support of the expanded service base in our Acute Care segment coupled with and expenses attributable to the Non-Acute Care segment.

30

Gross profit on service and other revenues increased by $1.4 million, or 19.0%, in the three months ended June 30, 2012 as compared to the same period in 2011. Gross profit on service and other revenues increased by $2.0 million, or 14.0%, in the six months ended June 30, 2012 as compared to the same period in 2011. The increase in gross profit on service and other revenues was primarily due to increased revenues from an expanded installed base with nominal growth in service cost attributable to our Acute Care segment. The contribution to gross profit on service and other revenues from our Non-Acute Care segment was immaterial.

We expect our service and other revenues and associated gross profit to vary in the future. We expect increases in the install base and the addition of non acute care segment service revenue and gross profit to be partially or fully offset by an increased propensity for customers to contract for service on a time and material basis, variations in the quantity and cost of spare parts used to service our install base, and increases in staffing to accommodate an increased number of customers.

Operating Expenses

The table below shows our operating expenses for the three months and six months ended June 30, 2012 and 2011 and the percentage changes between those periods (in thousands, except percentages):

	Three Months Ended June 30,						Six Months Ended June 30,
	2012		2011		% Change		2012		2011		% Change
Research and development	$	5,499	$	5,280	4.1	%	$	11,993	$	10,120	18.5	%
Selling, general and administrative	31,446		24,297		29.4	%	57,066		50,078		14.0	%
Total operating expenses	$	36,945	$	29,577	24.9	%	$	69,059	$	60,198	14.7	%

Research and Development. Research and development expenses increased by $0.2 million, or 4.1%, in the three months ended June 30, 2012 as compared to the same period in 2011, primarily due to the addition of Non-Acute Care research and development expenses. Research and development expenses represented 7.3% and 8.7% of total revenues in the three months ended June 30, 2012 and 2011, respectively. Research and development expenses increased by $1.9 million, or 18.5%, in the six months ended June 30, 2012 as compared to the same period in 2011 and represented 8.6% and 8.5% of total revenues in the six months ended June 30, 2012 and 2011, respectively. The increase was primarily due to a $1.8 million decrease in software capitalization primarily the result of no similar expenses eligible for capitalization in the first quarter of 2012, and an increase of $0.5 million in consulting, offset by a decrease of $0.8 million primarily due to salary related expenses in our Acute Care segment coupled with the aforementioned increase associated with our Non-Acute Care segment. The amount of research and development expense can fluctuate based on the amount of prototype expenses for hardware and/or the amount of capitalized software development costs in any given quarter.

We expect research and development expenses to remain relatively flat as a percentage of our revenue on an annual basis and grow in absolute dollars in the future as our revenue grows to improve and enhance our existing technologies and to create new technologies in health care automation.

Selling, General and Administrative. Selling, general and administrative expenses increased by $7.1 million, or 29.4%, in the three months ended June 30, 2012 as compared to the same period in 2011. Selling, general and administrative expenses represented 41.7% and 39.8% of total revenues in the three months ended June 30, 2012 and 2011, respectively. The increase was primarily due to the addition of MTS selling, general and administrative expenses of $2.4 million, $1.0 million increase in compensation costs related to increased sales and marketing staffing, $0.4 million in bad debt expense, and $3.2 million in acquisition-related expenses.

Selling, general and administrative expenses increased by $7.0 million, or 14.0%, in the six months ended June 30, 2012 as compared to the same period in 2011. Selling, general and administrative expenses represented 40.9% and 42.4% of total revenues in the six months ended June 30, 2012 and 2011, respectively. The increase was primarily due to the addition of Non-Acute Care selling, general and administrative expenses of $2.4 million, a $2.4 million increase in compensation costs related to increased sales and marketing staffing, and $3.2 million in acquisition-related expenses, offset by a $1.1 million decrease in legal expenses related to the settlement of the Medacist litigation in the six months ended June 30, 2011.

We expect selling, general and administrative expenses to grow at a nominal rate in order to support our anticipated growth as well as international expansion efforts, but anticipate that increased efficiencies will result in a lower selling, general and administrative expense growth relative to total revenue growth in 2012.

Share-based Compensation. The effect of share-based compensation on functional expenses within our operating results for the three months and six months ended June 30, 2012 and 2011 is presented in Note 13, “Stock Option Plans and

31

Share-Based Compensation.”

Provision for Income Taxes

The annual effective tax rate before discrete items was 40.9% and 41.7% for the six months ended June 30, 2012 and 2011, respectively.The decrease in the estimated 2012 annual effective tax rate recorded in the six months ended June 30, 2012 as compared to the same period in 2011 was primarily due to an increase in expected domestic production activities deduction in 2012, partially offset by the expiration of the federal research and development credit after 2011 and non-deductible acquisition costs.

Liquidity and Capital Resources

We had cash and cash equivalents of $54.1 million at June 30, 2012, as compared to $191.8 million in cash and cash equivalents and $8.1 million of short term investments at December 31, 2011. All of our cash is in low risk short term money market funds or demand deposits. The $8.1 million of short term investments held at December 31, 2011 consisted of California revenue anticipation notes which matured on June 26, 2012. We have no long term investments. While in the future we may need to seek additional financing to meet our working capital needs and to finance capital expenditures, as well as to fund operations or potential acquisitions, we believe our current cash and cash equivalent balances and cash flows generated by operations will be sufficient to satisfy our anticipated cash needs for working capital and capital expenditures for at least the next twelve months. Our cash and cash equivalents of $54.1 million reflects use of $156.3 million of cash expended to acquire MTS on May 21, 2012, net of cash acquired, as described in Note 14, “Business Acquisition”.

Cash flows for the six months ended June 30, 2012 and 2011 consisted of the following (in thousands):

	Six Months Ended June 30,
	2012			2011
Net cash provided by operating activities	$	18,758		$	7,263
Net cash (used in) provided by investing activities	(153,940		)	222
Net cash used in financing activities	(2,532		)	(1,870		)
Effect of exchange rate changes on cash and cash equivalents	23			8
Net (decrease) increase in cash and cash equivalents	$	(137,691	)	$	5,623

Operating activities provided $18.8 million of cash during the six months ended June 30, 2012 as compared to $7.3 million for the six months ended June 30, 2011. The main drivers for the $11.5 million increase in cash generated from operations were a $0.5 million increase in net income, a $12.9 million increase from the change in inventories primarily the result of a non-recurring increase in 2011 in anticipation of new product introductions, a $5.6 million cash increase from accrued compensation, and a $1.6 million cash increase from the excess tax benefits from employee stock plans. These were partially offset by a $2.5 million cash decrease from prepaid expenses, a $2.1 million decrease from accrued liabilities, a $2.0 million decrease from accounts payable and a $1.5 million decrease from investment in sales-type leases.

Cash used in investing activities totaled $153.9 million during the six months ended June 30, 2012, as compared to $0.2 million provided by investing activities during the six months ended June 30, 2011. This $154.2 million decrease in cash primarily reflects the $156.3 million of net cash used to acquire MTS. This was partially offset by a decline in software development, from $3.1 million for the six months ended June 30, 2011 as compared to $1.4 million in the six months ended June 30, 2012. The prior period had more pre-capitalization testing of several new software applications for external sale or lease.

Cash used by financing activities was $2.5 million during the six months ended June 30, 2012, as compared to $1.9 million during the six months ended June 30, 2011, a difference of $0.7 million in cash used. Excess tax benefits from employees stock plans provided $1.6 million lower cash inflow in the six months ended June 30, 2012, whereas the cash effect of stock purchases, comparing the two periods, provided $0.9 million more cash.

Contractual Obligations

Except for the Milpitas lease signed in March 2012 and the assumption of the St. Petersburg lease in May 2012, there have been no material changes to our contractual obligations during the six months ended June 30, 2012. Please refer to our Annual Report on Form 10-K for the year ended December 31, 2011 for a description of our facility leases and contractual obligations and the Notes to the consolidated financial statements included therein.

32

The following table summarizes our contractual obligations at June 30, 2012 (in thousands):

	Total		Less than one year		One to three years		Three to five years		More than five years
Operating leases (1) (2) (3) (4)	$	48,121	$	5,486	$	10,591	$	9,549	$	22,495
Commitments to contract manufacturers and suppliers (5)	7,310		7,310		—		—		—
Total (6)	$	55,431	$	12,796	$	10,591	$	9,549	$	22,495

(1)       Commitments under operating leases relate primarily to leasehold property and office equipment.

(2)       In October 2011, we entered into a lease agreement for approximately 100,000 square feet of office space. Pursuant to the lease agreement, the landlord will construct a single, three-story building of rentable space located at 590 Middlefield Road in Mountain View, California which we will subsequently lease and which will serve as our headquarters. The term of the lease agreement is for a period of ten years, expected to commence November 2012, with a base lease commitment of approximately $40.0 million. We have two options to extend the term of the lease agreement at market rates. Each extension is for an additional sixty month term.

(3) In March 2012, we entered into a lease agreement for approximately 46,000 square feet of manufacturing, distribution and office space located at 735 Sycamore Drive in Milpitas, California. The term of the lease agreement is for a period of sixty months, expected to commence approximately October 2012, with a base lease commitment of approximately $1.8 million and a single sixty month extension option.

(4)    Commencing with the May 2012 acquisition of MTS, we assumed responsibility for 132,500 square feet of manufacturing, warehousing and office space in St. Petersburg, Florida. The remaining term of the original 12 year lease agreement is through September 30, 2016 with a remaining base lease commitment of approximately $3.9 million. We have two options to extend the term of the lease agreement at market rates. Each extension is for an additional 60 month term. In Leeds, United Kingdom, MTS leases an office and distribution center. The remaining term of the original 10 year lease agreement is through June 8, 2021, with no extension options. The remaining base lease commitment, converted from British Pounds at the current conversion rate, is approximately $1.2 million. MTS also has smaller rented offices in Strongsville, Ohio and Germany.

(5)    We purchase components from a variety of suppliers and use contract manufacturers to provide manufacturing services for our products. During the normal course of business, we issue purchase orders with estimates of our requirements several months ahead of the delivery dates.

(6)    At June 30, 2012, we have recorded $3.0 million for uncertain tax positions under long term liabilities, in accordance with GAAP, summarized under Note 1, “Organization and Summary of Significant Accounting Policies.” As these liabilities do not reflect actual tax assessments, the timing and amount of payments we might be required to make will depend upon a number of factors. Accordingly, as the timing and amount of payment cannot be estimated, the $3.0 million of uncertain tax position liabilities has not been included in the table of commitments above.

Off-Balance Sheet Arrangements

As of June 30, 2012, we had no off-balance sheet arrangements as defined under Regulation S-K 303(a)(4) of the Securities Exchange Act of 1934, as amended, and the instructions thereto.

Item 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

As of June 30, 2012, there were no material changes to our disclosures to market risk from the disclosures set forth under the caption, “Quantitative and Qualitative Disclosures About Market Risk” in Part II, Item 7A of our Annual Report on Form 10-K for the year ended December 31, 2011, other than the foreign currency exposure described in Note 16, “Risk Management and Derivatives,” which are now relevant due to the higher foreign revenues of the acquired MTS business.

Item 4.    CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

33

Our management, with the participation of our principal executive officer and principal financial officer, has evaluated the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of June 30, 2012. Based on such evaluation, our principal executive officer and principal financial officer have concluded that, as of June 30, 2012, our disclosure controls and procedures were effective.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the three months ended June 30, 2012 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

34

PART II    OTHER INFORMATION

Item 1. LEGAL PROCEEDINGS

Legal Proceedings

 The information set forth under “Legal Proceedings” in Note 11, “Contingencies,” of the Notes to Consolidated Financial Statements in Part I, Item 1 of this Quarterly Report on Form 10-Q for the period ended June 30, 2012 is incorporated herein by reference.

Item 1A. RISK FACTORS

We have identified the following risks and uncertainties that may have a material adverse effect on our business, financial condition or results of operations. Our business faces significant risks and the risks described below may not be the only risks we face. Additional risks not presently known to us or that we currently believe are immaterial may also significantly impair our business operations. If any of these risks occur, our business, results of operations or financial condition could suffer and the market price of our common stock could decline.

Unfavorable economic and market conditions, a decreased demand in the capital equipment market and uncertainty regarding the rollout of government legislation in the healthcare industry could adversely affect our operating results.

Customer demand for our products is significantly linked to the strength of the economy. If decreases in demand for capital equipment caused by weak economic conditions and decreased corporate and government spending, deferrals or delays of capital equipment projects, longer time frames for capital equipment purchasing decisions or generally reduced expenditures for capital solutions continues, we will experience decreased revenues and lower revenue growth rates and our operating results could be materially and adversely affected.

Additionally, as the U.S. Federal government implements healthcare reform legislation, and as Congress, regulatory agencies and other state governing organizations continue to review and assess additional healthcare legislation and regulations, there may be an impact on our business. Healthcare facilities may decide to postpone or reduce spending until the implications of such healthcare enactments are more clearly understood, which may affect the demand for our products and harm our business.

The medication management and supply chain solutions market is highly competitive and we may be unable to compete successfully against new entrants and established companies with greater resources and/or existing business relationships with our current and potential customers.

The medication management and supply chain solutions market is intensely competitive. We expect continued and increased competition from current and future competitors, many of which have significantly greater financial, technical, marketing and other resources than we do. Our current direct competitors in the medication management and supply chain solutions market include CareFusion Corporation (a spinoff from Cardinal Health, Inc., which includes Pyxis Corporation), McKesson Automation Inc. (a business unit of McKesson Corporation), AmerisourceBergen Corporation (through its acquisition of MedSelect, Inc. and Automed), Cerner Corporation, Talyst, Inc., Emerson Electronic Co. (through its acquisitions of Flo Healthcare LLC, Lionville Systems, Inc. and medDispense, L.P.), PhACTs LLC, Swisslog Holding AG, Stinger Medical, Stanley Black and Decker, Inc. (through their acquisition of InfoLogix, Inc.), Ergotron, Inc., Capso Solutions LLC (through their acquisition of Artromick International, Inc.), Rubbermaid Medical Solutions (a business unit of Newell Rubbermaid Inc.), WaveMark Inc., ParExcellence Systems, Inc., Vanas n.v., Lawson Software, Inc. and MACH4 Automatisierungstechnik GmbH. Our current direct competitors in the medication packaging solutions market include Drug Package, Inc., AutoMed® Technologies, Inc. (a subsidiary of AmerisourceBergen Corporation) and RX Systems, Inc. in the United States, and Surgichem Ltd., Jones Packaging Ltd. and Manchac Technologies, LLC (aka Dosis) in Europe.

The competitive challenges we face in the medication management and supply chain solutions market include, but are not limited to, the following:

• certain competitors may develop new features or capabilities for their products not previously offered that could compete directly with our products;

• competitive pressures could result in increased price competition for our products and services, fewer customer orders and reduced gross margins, any of which could harm our business;

• current and potential competitors may make strategic acquisitions or establish cooperative relationships among

35

themselves or with third parties, including larger, more established healthcare supply companies, thereby increasing their ability to develop and offer products and services to address the needs of our prospective customers;

• our competitors may develop, license or incorporate new or emerging technologies or devote greater resources to the development, promotion and sale of their products and services than we do;

• certain competitors have greater brand name recognition and a more extensive installed base of medication and supply dispensing systems or other products and services than we do, and such advantages could be used to increase their market share;

• certain competitors may have existing business relationships with our current and potential customers, which may cause these customers to purchase medication and supply dispensing systems or automation solutions from these competitors;

• other established or emerging companies may enter the medication management and supply chain solutions market; and

• our competitors may secure products and services from suppliers on more favorable terms or secure exclusive arrangements with suppliers or buyers that may impede the sales of our products and services.

Any reduction in the demand for or adoption of our medication and supply systems, related services, or consumables would reduce our revenues.

Our medication and supply dispensing systems represent only one approach to managing the distribution of pharmaceuticals and supplies at acute healthcare facilities and our medication packaging systems represent only one way of managing medication distribution at non-acute care facilities. A significant portion of domestic and international healthcare facilities still use traditional approaches in some form that do not include fully automated methods of medication and supply management. As a result, we must continuously educate existing and prospective customers about the advantages of our products, which requires significant sales efforts and can cause longer sales cycles. Despite our significant efforts and extensive time commitments in sales to healthcare facilities, we cannot be assured that our efforts will result in sales to these customers.

In addition, our medication and supply dispensing systems and our more complex automated packaging systems typically represent a sizable initial capital expenditure for healthcare organizations. Changes in the budgets of these organizations and the timing of spending under these budgets can have a significant effect on the demand for our medication and supply dispensing systems and related services. These budgets are often supported by cash flows that can be negatively affected by declining investment income, and influenced by limited resources, increased operational and financing costs, macroeconomic conditions such as unemployment rates and conflicting spending priorities among different departments. Any decrease in expenditures by healthcare facilities could decrease demand for our medication and supply dispensing systems and related services and reduce our revenues.

Changing customer requirements could decrease the demand for our products and services and our new product solutions may not achieve market acceptance.

The medication management and supply chain solutions market is characterized by evolving technologies and industry standards, frequent new product introductions and dynamic customer requirements that may render existing products obsolete or less competitive. The medication management and supply chain solutions market could erode rapidly due to unforeseen changes in the features and functions of competing products, as well as the pricing models for such products. Our future success will depend in part upon our ability to enhance our existing products and services and to develop and introduce new products and services to meet changing customer requirements. The process of developing products and services such as those we offer is extremely complex and is expected to become increasingly more complex and expensive in the future as new technologies are introduced. If we are unable to enhance our existing products or develop new products to meet changing customer requirements, and bring such enhancements and products to market in a timely manner, demand for our products could decrease.

We cannot assure you that we will be successful in marketing any new products or services that we introduce, that new products or services will compete effectively with similar products or services sold by our competitors, or that the level of market acceptance of such products or services will be sufficient to generate expected revenues and synergies with our other products or services. Deployment of new products or services often requires interoperability with other Omnicell products or services as well as with healthcare facilities’ existing information management systems. If these products or services fail to satisfy these demanding technological objectives, our customers may be dissatisfied and we may be unable to generate future sales.

36

The acquisition of MTS could cause disruptions in our business, which could have an adverse effect on our financial results.

On May 21, 2012, we completed the acquisition of MTS, a provider of medication adherence packaging systems. Uncertainty about the effect of the acquisition on employees, customers, distributors, partners and suppliers may have an adverse effect on the combined company. These uncertainties may impair our ability to retain and motivate key personnel and could cause customers, distributors, suppliers, partners and others with whom we do business to seek to change existing business relationships. Any such change may materially and adversely affect our business. Any disruption in our operations could adversely affect the combined company’s ability to maintain relationships with customers, distributors, partners, suppliers and employees or to achieve the anticipated benefits of the acquisition.

If we experience delays in installations of our medication and supply dispensing systems or our more complex medication packaging systems, resulting in delays in our ability to recognize revenue, our competitive position, results of operations and financial condition could be harmed.

The purchase of our medication and supply dispensing systems or our more complex medication packaging systems is often part of a customer’s larger initiative to re-engineer its pharmacy, distribution and materials management systems and as a result, our sales cycles are often lengthy. The purchase of our systems often entail larger strategic purchases by customers that frequently require more complex and stringent contractual requirements and generally involves a significant commitment of management attention and resources by prospective customers. These larger and more complex transactions often require the input and approval of many decision-makers, including pharmacy directors, materials managers, nurse managers, financial managers, information systems managers, administrators, lawyers and boards of directors. For these and other reasons, the sales cycle associated with the sale of our medication and supply dispensing systems is often lengthy and subject to a number of delays over which we have little or no control. A delay in, or loss of, sales of our medication and supply dispensing systems could have an adverse effect upon our operating results and could harm our business.

In addition, and in part as a result of the complexities inherent in larger transactions, the average time between the purchase and installation of our systems is usually between two weeks and one year. Delays in installation can occur for reasons that are often outside of our control. We have also experienced fluctuations in our customer and transaction size mix, which increases the difficulty in our ability to forecast our product backlog. Because we recognize revenue for our medication and supply dispensing systems and our more complex medication packaging systems only upon installation at a customer’s site, any delay in installation by our customers will also cause a delay in the recognition of revenue for that system.

We may not be able to successfully integrate acquired businesses or technologies into our existing business, including those of MTS, which could negatively impact our operating results.

As a part of our business strategy we may seek to acquire businesses, technologies or products in the future. For example, on May 21, 2012, we completed the acquisition of MTS. We cannot assure you that any acquisition or any future transaction we complete will result in long-term benefits to us or our stockholders, or that our management will be able to integrate or manage the acquired business effectively. Acquisitions entail numerous risks, including difficulties associated with the integration of operations, technologies, products and personnel that, if realized, could harm our operating results. Risks related to potential acquisitions include, but are not limited to:

• difficulties in combining previously separate businesses into a single unit;

• the substantial costs that may be incurred and the substantial diversion of management’s attention from day-to-day business when evaluating and negotiating such transactions and then integrating an acquired business;

• discovery, after completion of the acquisition, of liabilities assumed from the acquired business or of assets acquired that are broader in scope and magnitude or are more difficult to manage than originally assumed;

• failure to achieve anticipated benefits such as cost savings and revenue enhancements;

• difficulties related to assimilating the products of an acquired business; and

• failure to understand and compete effectively in markets in which we have limited previous experience.

Successful integration of Omnicell’s and MTS’ operations, products and personnel may place a significant burden on the combined company’s management and internal resources. Omnicell may also experience difficulty in effectively integrating the different cultures and practices of MTS. Further, the difficulties of integrating MTS could disrupt the combined company’s ongoing business, distract its management focus from other opportunities and challenges, and increase expenses and working capital requirements. The diversion of management attention and any difficulties encountered in the transition and integration process could harm our business, financial condition and operating results.

37

We may fail to realize the potential benefits of the acquisition of MTS.

We acquired MTS in an effort to realize certain potential benefits, including expansion of the combined businesses and broader market opportunities. However, our ability to realize these potential benefits depends on our successfully combining the businesses of Omnicell and MTS. The combined company may fail to realize the potential benefits of the merger for a variety of reasons, including the following:

• inability or failure to expand in long term care markets for medication management and adherence;

• inability or failure to effectively coordinate sales and marketing efforts to communicate the capabilities of the combined company;

• inability or failure to successfully integrate and harmonize financial reporting and information technology systems;

• inability or failure to achieve the expected operational and cost efficiencies; and

• loss of key employees.

The actual integration may result in additional and unforeseen expenses or delays. If we are not able to successfully integrate MTS’ business and operations, or if there are delays in combining the businesses, the anticipated benefits of the acquisition may not be realized fully or at all or may take longer to realize than expected.

Demand for our consumable medication packages is perishable and if we are not able to supply the demand from our institutional and retail pharmacy customers on schedule, they may utilize alternative means to distribute medications to their customers.

Approximately 20% of our revenue is generated from the sale of consumable medication packages, which are produced in our St. Petersburg, Florida facilities on a continuous basis and shipped to our institutional pharmacies and retail pharmacy customers shortly before they are required by those customers.The demands placed on institutional pharmacies and retail pharmacies by their customers represent real time requirements of those customers. Our customer agreements for the sale of consumable medication packages are typically short-term in nature and typically do not include any volume commitments on the part of the customer. Although our packaging may be considered the preferred method of maintaining control of medications during the medication distribution and administration process, institutional and retail pharmacies have alternative methods of distributing medications, including bulk and alternative packaging, and medication adherence packaging may be supplied by our competitors. To the extent that we are unable to supply packaging to our customers in a timely manner, that demand will be supplied via alternative distribution methods and our revenue will be adversely affected. Any disruption in the production capabilities of our St. Petersburg facilities will adversely affect our ability to ship our consumable medication packages and would adversely affect our revenue.

We may need additional financing in the future to meet our capital needs and such financing may not be available on favorable terms, if at all, and may be dilutive to existing stockholders.

We intend to continue to expend substantial funds for research and development activities, product development, sales and marketing activities and the potential acquisition and integration of complementary products and businesses. As a consequence, in the future we may need to seek additional financing to meet our working capital needs and to finance capital expenditures, as well as to fund operations or potential acquisitions. We may be unable to obtain any desired additional financing on terms favorable to us, if at all. If adequate funds are not available on acceptable terms, we may be unable to fund our expansion, successfully develop or enhance products, respond to competitive pressures or take advantage of acquisition opportunities, any of which could negatively affect our business. If we raise additional funds through the issuance of equity securities, our stockholders will experience dilution of their ownership interest. If we raise additional funds by issuing debt, we may be subject to certain contractual restrictions on our operations.

If we are unable to recruit and retain skilled and motivated personnel, our competitive position, results of operations and financial condition could be harmed.

Our success is highly dependent upon the continuing contributions of our key management, sales, technical and engineering staff. We believe that our future success will depend upon our ability to attract, train and retain highly skilled and motivated personnel. As more of our products are installed in increasingly complex environments, greater technical expertise will be required. As our installed base of customers increases, we will also face additional demands on our customer service and support personnel, requiring additional resources to meet these demands. We may experience difficulty in recruiting qualified personnel. Competition for qualified technical, engineering, managerial, sales, marketing, financial reporting and other personnel can be intense and we cannot assure you that we will be successful in attracting and retaining qualified

38

personnel. Competitors have in the past attempted, and may in the future attempt, to recruit our employees.

In addition, we have historically used stock options, restricted stock units and other forms of equity compensation as key components of our employee compensation program in order to align employees’ interests with the interests of our stockholders, encourage employee retention and provide competitive compensation packages. The effect of managing share-based compensation expense may make it less favorable for us to grant stock options, restricted stock units, or other forms of equity compensation, to employees in the future. In order to continue granting equity compensation at competitive levels, we must seek stockholder approval for any increases to the number of shares reserved for issuance under our equity incentive plans and we cannot assure you that we will receive such approvals. Any failure to receive approval for proposed increases could prevent us from granting equity compensation at competitive levels and make it more difficult to attract, retain and motivate employees. Further, to the extent that we expand our business or product lines through the acquisition of other businesses, any failure to receive any such approvals could prevent us from securing employment commitments from such newly acquired employees. Failure to attract and retain key personnel could harm our competitive position, results of operations and financial condition.

We have experienced substantial fluctuations in customer demand, affecting our annual revenue, and we cannot be sure that we will be able to respond proactively to future changes in customer demand.

Macroeconomic and general market conditions in recent years have contributed to revenue volatility. Revenues for the year ended December 31, 2009 declined by $38.4 million or 15.2% from $251.9 million in 2008. For the year ended December 31, 2010, revenue increased by $8.9 million or 4.2% to $222.4 million compared to $213.5 million for 2009. For the year ended December 31, 2011, revenue increased by $23.1 million or 10.4% to $245.5 million.

Our ability to adjust to rapid reductions in our revenue while still achieving or sustaining profitability is dependent upon our ability to manage costs and control expenses. If macroeconomic and general market conditions improve and return to historical levels, our ability to grow revenue and profitability will also be dependent on our ability to continue to manage costs and control expenses. If our revenue increases rapidly, we may not be able to manage this growth effectively. Future growth is dependent on the continued demand for our products, the volume of installations we are able to complete, our ability to continue to meet our customers’ needs and provide a quality installation experience and our flexibility in manpower allocations among customers to complete installations on a timely basis.

Our expense control is dependent on our ability to continue to develop and leverage effective and efficient human and information technology systems, our ability to gain efficiencies in our workforce through the local and worldwide labor markets and our ability to grow our outsourced vendor supply model. Our expense growth rate may equal or exceed our revenue growth rate if we are unable to streamline our operations, or fail to reduce the costs or increase the margins of our products. In addition, we may not be able to reduce our expenses to keep pace with any reduction in our revenue, which could harm our results of operations and financial position.

The healthcare industry faces financial constraints and consolidation that could adversely affect the demand for our products and services.

The healthcare industry has faced, and will likely continue to face, significant financial constraints. Recently enacted legislation such as the American Recovery and Reinvestment Act in 2009, the Patient Protection and Affordable Care Act in 2010, the Budget Control Act of 2011, and other health reform legislation may cause customers to postpone purchases of our products while the impact of the legislation on their operations is determined. Our automation solutions often involve a significant financial commitment by our customers and, as a result, our ability to grow our business is largely dependent on our customers’ capital and operating budgets. To the extent healthcare spending declines or increases more slowly than we anticipate, demand for our products and services could decline.

Many healthcare providers have consolidated to create larger healthcare delivery organizations to achieve greater market power. If this consolidation continues, it could reduce the number of our target customers. In addition, the resulting organizations could have greater bargaining power, which may lead to price erosion.

Our failure to protect our intellectual property rights could negatively affect our ability to compete.

Our success depends in part on our ability to obtain patent protection for technology and processes and our ability to preserve our trademarks, copyrights and trade secrets. We have pursued patent protection in the United States and foreign jurisdictions for technology that we believe to be proprietary and for technology that offers us a potential competitive advantage for our products. We intend to continue to pursue such protection in the future. Our issued patents relate to various

39

features of our medication and supply dispensing systems and our packaging systems. We cannot assure you that we will file any patent applications in the future, and that any of our patent applications will result in issued patents or that, if issued, such patents will provide significant protection for our technology and processes. Furthermore, we cannot assure you that others will not develop technologies that are similar or superior to our technology or that others will not design around the patents we own. All of our system software is copyrighted and subject to the protection of applicable copyright laws. Despite our efforts to protect our proprietary rights, unauthorized parties may attempt to copy aspects of our products or obtain and use information that we regard as proprietary, which could harm our competitive position.

Our international operations may subject us to additional risks that can adversely affect our operating results.

We currently have operations outside of the United States, including sales efforts centered in Canada, Europe, the Middle East and Asia-Pacific regions. Other international operations include a third-party service provider in India for customer support activity, our Hong Kong office to support international supply chain sourcing in Asia a sales office and training center in the United Arab Emirates, a sales and distribution center in the United Kingdom, and a sales office in Germany. During the fourth quarter of 2011, we launched Mandarin-language versions of our G4 medication automation products for clinical use in China and entered into a partnership to distribute, install, and service our automated medication dispensing systems in China. Our international operations subject us to a variety of risks, including:

• the difficulty of managing an organization operating in various countries;

• growing political sentiment against international outsourcing of production;

• reduced protection for intellectual property rights, particularly in jurisdictions that have less developed intellectual property regimes;

• changes in foreign regulatory requirements;

• the requirement to comply with a variety of international laws and regulations, including labor, import, export, tax, anti-bribery and employment laws and changes in tariff rates;

• fluctuations in currency exchange rates and difficulties in repatriating funds from certain countries; and

• political unrest, terrorism and the potential for other hostilities in areas in which we have facilities.

Our success depends, in part, on our ability to anticipate and address these risks. We cannot assure you that these or other factors will not adversely affect our business or operating results.

Our quarterly operating results may fluctuate and may cause our stock price to decline.

Our quarterly operating results may vary in the future depending on many factors that include, but are not limited to, the following:

• our ability to successfully install our products on a timely basis and meet other contractual obligations necessary to recognize revenue;

• the size, product mix and timing of orders for our medication and supply dispensing systems, and our medication packaging systems, and their installation and integration;

• the overall demand for healthcare medication management and supply chain solutions;

• changes in pricing policies by us or our competitors;

• the number, timing and significance of product enhancements and new product announcements by us or our competitors;

• the timing and significance of any acquisition or business development transactions that we may consider or negotiate and the revenues, costs and earnings that may be associated with these transactions;

• the relative proportions of revenues we derive from products and services;

• fluctuations in the percentage of sales attributable to our international business;

• our customers’ budget cycles;

• changes in our operating expenses and our ability to stabilize expenses;

• our ability to generate cash from our accounts receivable on a timely basis;

• the performance of our products;

• changes in our business strategy;

• macroeconomic and political conditions, including fluctuations in interest rates, tax increases and availability of credit markets; and

• volatility in our stock price and its effect on equity-based compensation expense.

Due to all of these factors, our quarterly revenues and operating results are difficult to predict and may fluctuate, which in turn may cause the market price of our stock to decline.

40

If we are unable to maintain our relationships with group purchasing organizations or other similar organizations, we may have difficulty selling our products and services to customers represented by these organizations.

A number of group purchasing organizations, including AmeriNet, Inc., Carolina Shared Services, LLC, Child Health Corporation of America, HealthTrust Purchasing Group, L.P., MedAssets, Inc. Supply Chain Systems, Novation, LLC, Premier Purchasing Partners, L.P. and Resources Optimization & Innovation, LLC have negotiated standard contracts for our products on behalf of their member healthcare organizations. Members of these group purchasing organizations may purchase under the terms of these contracts, which obligates us to pay the group purchasing organization a fee. We have also contracted with the United States General Services Administration, allowing the Department of Veteran Affairs, the Department of Defense and other Federal Government customers to purchase our products. These contracts enable us to more readily sell our products and services to customers represented by these organizations. Some of our contracts with these organizations are terminable at the convenience of either party. The loss of any of these relationships could impact the breadth of our customer base and could impair our ability to meet our revenue targets or increase our revenues. We cannot assure you that these organizations will renew our contracts on similar terms, if at all, and they may choose to terminate our contracts before they expire.

If we are unable to maintain our relationships with major institutional pharmacies, we may experience a decline in the sales of consumables used to produce blister cards to these customers

The institutional pharmacy market is consists of both significant national suppliers of medications to non-acute care facilities, smaller regional suppliers, and very small local suppliers. Although none of these customers comprise more than 10% of Omnicell revenues, they may, in some periods, comprise between 5 and 10% of revenues. If the larger national suppliers were to source consumable blister card components from alternative sources, or if alternatives to blister cards were used for medication control, our revenues would decline.

If construction of our new headquarters building is not completed on schedule, we risk increased costs and possible interruption of our business.

We entered into a long term lease for a new headquarters building that commenced construction in November 2011 and is anticipated to be completed in November 2012.We intend to move into the new building at the end of 2012. In the event that our new facility is not completed in time for us to move by December 2012, the lease for our current headquarters facility allows for continuation of occupancy on a month to month basis for one year following November 30, 2012, however the monthly rent pursuant to such basis would be at a substantial increase to our current monthly rent. If our new headquarters facility is not completed by November 30, 2012, we would, under the continuation terms of our current lease, incur additional costs of $6,368 per day for up to a period of one year. If the new headquarters facility is not completed by November 30, 2013, we do not expect our current landlord to further extend our current lease and therefore we could experience interruptions to our business while we secure a new headquarters facility.

Additionally, we will be relocating our manufacturing operations to a new facility in Milpitas, California, with occupancy approximately in October 2012. If the move to the new manufacturing facility is not effectively coordinated with the headquarters move, we could experience increased costs and/or interruptions to our business.

Our failure to maintain effective internal control over financial reporting in accordance with Section 404 of the Sarbanes-Oxley Act of 2002 could cause our stock price to decline.

If we fail to maintain effective internal control over financial reporting, as such standards are modified, supplemented or amended from time to time, we may not be able to ensure that we can conclude on an ongoing basis that we have effective internal control over financial reporting. Section 404 of the Sarbanes-Oxley Act of 2002 and the related rules and regulations of the SEC require annual management assessments of the effectiveness of our internal control over financial reporting and a report by our independent registered public accounting firm attesting to the effectiveness of internal control.

As of December 31, 2010 our management determined that our internal control over financial reporting was not effective under the Section 404 criteria, as a result of a material weakness in our income tax accounting. Specifically, our processes, procedures and controls related to the preparation and review of the annual income tax provision were not effective to ensure that amounts recorded for the income tax provision and the related current and deferred income tax asset and liability accounts were accurate and determined in accordance with U.S. GAAP.

Based on completion of our remediation plan, our management determined that, as of December 31, 2011, we had remediated the material weakness in internal control over financial reporting that existed at December 31, 2010. However, any future failure by us to maintain an effective internal control environment could negatively impact the market price of our

41

common stock.

If the market price of our common stock continues to be highly volatile, the investment value of our common stock may decline.

During the six months ended June 30, 2012, our common stock traded between $12.74 and $17.94 per share. The market price for shares of our common stock has been and may continue to be highly volatile. In addition, our announcements or external events may have a significant impact on the market price of our common stock. These announcements or external events may include:

• changes in our operating results;

• developments in our relationships with corporate customers;

• changes in the ratings of our common stock by securities analysts;

• announcements by us or our competitors of technological innovations or new products;

• announcements by us or our competitors of acquisitions of businesses, products or technologies; or

• general economic and market conditions.

Furthermore, the stock market as a whole from time to time has experienced extreme price and volume fluctuations, which have particularly affected the market prices for technology companies. These broad market fluctuations may cause the market price of our common stock to decline irrespective of our performance. In addition, sales of substantial amounts of our common stock in the public market could lower the market price of our common stock.

We depend on a limited number of suppliers for our products and our business may suffer if we were required to change suppliers to obtain an adequate supply of components, equipment and raw materials on a timely basis.

Although we generally use parts and components for our products with a high degree of modularity, certain components are presently available only from a single source or limited sources. We rely on a limited number of suppliers for the raw materials that are necessary in the production of our consumable medication packages. We have generally been able to obtain adequate supplies of all components and raw materials in a timely manner from existing sources, or where necessary, from alternative sources of supply. We engaged multiple single source third-party manufacturers to build several of our sub-assemblies. The risk associated with changing to alternative vendors, if necessary, for any of the numerous components used to manufacture our products could limit our ability to manufacture our products and harm our business. Our reliance on a few single source partners to build our hardware sub-assemblies and on a limited number of suppliers for the raw materials that are necessary in the production of our consumable medication packages, a reduction or interruption in supply from our partners or suppliers, or a significant increase in the price of one or more components could have an adverse impact on our business, operating results and financial condition. In certain circumstances, the failure of any of our suppliers or us to perform adequately could result in quality control issues affecting end users’ acceptance of our products. These impacts could damage customer relationships and could harm our business.

Complications in connection with our ongoing business information system upgrades to adopt new accounting standards and eventually adopt changes driven by converged accounting standards for revenues, leases and other topics may impact our results of operations, financial condition and cash flows.

We continue to upgrade our enterprise-level business information system with new capabilities. Based upon the complexity of some of the upgrades, there is risk that we will not see the expected benefit from the implementation of these upgrades in accordance with their anticipated timeline and will incur costs in addition to those we have already planned for. In addition, in future years, we may need to begin efforts to comply with final converged accounting standards to be established by the FASB for revenues, leases and other components of our financial reporting. These new standards could require us to modify our accounting policies, including our revenue recognition policy, which we modified in fiscal 2011. We further anticipate that integration of these and possibly other new standards may require a substantial amount of management’s time and attention and require integration with our enterprise resource planning system. The implementation of the system and the adoption of future new standards, in isolation as well as together, could result in operating inefficiencies and financial reporting delays, and could impact our ability to record certain business transactions timely. All of these risks could adversely impact our results of operations, financial condition and cash flows.

Our U.S. government lease contracts are subject to annual budget funding cycles and mandated unilateral changes, which may affect our ability to enter into, recognize revenue and sell receivables based on these leases.

42

U.S. government customers that lease our equipment typically sign contracts with five-year payment terms that are subject to one-year government budget funding cycles. Further, the government has in certain circumstances mandated unilateral changes in its Federal Supply Services contract that could render our lease terms with the government less attractive. In our judgment and based on our history with these accounts, we believe these receivables are collectible. However, in the future, the failure of any of our U.S. government customers to receive their annual funding, or the government mandating changes to the Federal Supply Services contract could impair our ability to sell lease equipment to these customers or to sell our U.S. government receivables to third-party leasing companies. In addition, the ability to collect payments on unsold receivables could be impaired and may result in a write-down of our unsold receivables from U.S. government customers. As of June 30, 2012, the balance of our unsold leases to U.S. government customers was $11.5 million.

If we fail to manage our inventory properly, our revenue, gross margin and profitability could suffer.

Managing our inventory of components and finished products is a complex task. A number of factors, including, but not limited to, the need to maintain a significant inventory of certain components that are in short supply or that must be purchased in bulk to obtain favorable pricing, the general unpredictability of demand for specific products and customer requests for quick delivery schedules, may result in us maintaining large amounts of inventory. Other factors, including changes in market demand, customer requirements and technology, may cause inventory to become obsolete. Any excess or obsolete inventory could result in inventory write-downs, which in turn could harm our business and results of operations.

If we are unable to successfully interface our automation solutions with the existing information systems of our customers, they may choose not to use our products and services.

For healthcare facilities to fully benefit from our automation solutions, our systems must interface with their existing information systems. This may require substantial cooperation, incremental investment and coordination on the part of our customers and may require coordination with third party suppliers of the existing information systems. There is little uniformity in the systems currently used by our customers, which complicates the interfacing process. If these systems are not successfully interfaced, our customers could choose not to use or to reduce their use of our automation solutions, which would harm our business.

Additionally, our competitors may enter into agreements with providers of hospital information management systems that are designed to increase the interoperability of their respective products. To the extent our competitors are able to increase the interoperability of their products with those of the major hospital information systems providers, customers who utilize such information systems may choose not to use our products and services.

Intellectual property claims against us could harm our competitive position, results of operations and financial condition.

We expect that developers of medication and supply dispensing systems, and medication packaging systems, will be increasingly subject to infringement claims as the number of products and competitors in our industry grows and the functionality of products in different industry segments overlaps. In the future, third parties may claim that we have infringed upon their intellectual property rights with respect to current or future products. We do not carry special insurance that covers intellectual property infringement claims; however, such claims may be covered under our traditional insurance policies. These policies contain terms, conditions and exclusions that make recovery for intellectual property infringement claims difficult to guarantee. Any infringement claims, with or without merit, could be time-consuming to defend, result in costly litigation, divert management’s attention and resources, cause product shipment delays or require us to enter into royalty or licensing agreements. These royalty or licensing agreements, if required, may not be available on terms acceptable to us, or at all, which could harm our competitive position, results of operations and financial condition.

Our software products are complex and may contain defects, which could harm our reputation, results of operations and financial condition.

We market products that contain software and software only products. Although we perform extensive testing prior to releasing software products, these products may contain undetected errors or bugs when first released. These may not be discovered until the product has been used by customers in different application environments. Failure to discover product deficiencies or bugs could require design modifications to previously shipped products or cause unfavorable publicity or negatively impact system shipments, any of which could harm our business, financial condition and results of operations.

Product liability claims against us could harm our competitive position, results of operations and financial condition.

Our products provide medication management and supply chain management solutions for the healthcare industry.

43

Despite the presence of healthcare professionals as intermediaries between our products and patients, if our products fail to provide accurate and timely information or operate as designed, customers, patients or their family members could assert claims against us for product liability. Moreover, failure of health care facility employees to use our products for their intended purposes could result in product liability claims against us. Litigation with respect to liability claims, regardless of any outcome, could result in substantial cost to us, divert management’s attention from operations and decrease market acceptance of our products. We possess a variety of insurance policies that include coverage for general commercial liability, technology errors and omissions liability, and we attempt to mitigate these risks through contractual terms negotiated with our customers. However, these policies and protective contractual terms may not be adequate against product liability claims. A successful claim brought against us, or any claim or product recall that results in negative publicity about us, could harm our competitive position, results of operations and financial condition. Also, in the event that any of our products is defective, we may be required to recall or redesign those products.

We are dependent on technologies provided by third-party vendors.

Some of our products incorporate technologies owned by third parties that are licensed to us for use, modification, and distribution. If we lose access to third-party technologies, or we lose the ongoing rights to modify and distribute these technologies with our products we will either have to devote resources to independently develop, maintain and support the technologies ourselves, pay increased license costs, or transition to another vendor. Any independent development, maintenance or support of these technologies by us or the transition to alternative technologies could be costly, time consuming and could delay our product releases and upgrade schedules. These factors could negatively and materially affect our ability to market, sell or distribute our products and in turn our business and prospects.

Government regulation of the healthcare industry could reduce demand for our products, or substantially increase the cost to produce our products.

While the manufacture and sale of our current products are not regulated by the United States Food and Drug Administration, or FDA, or the Drug Enforcement Administration, or DEA, these products, or our future products, if any, may be regulated in the future by these or other federal agencies due to future legislative and regulatory initiatives or reforms. Direct regulation of our business and products by FDA, DEA or other federal agencies could substantially increase the cost to produce our products and increase the time required to bring those products to market, reduce the demand for our products and reduce our revenues. In addition, healthcare providers and facilities that use our equipment and dispense controlled substances are subject to regulation by the DEA. The failure of these providers and facilities to comply with DEA requirements, including the Controlled Substances Act and its implementing regulations, could reduce demand for our products and harm our competitive position, results of operations and financial condition. Pharmacies are regulated by individual state boards of pharmacy that issue rules for pharmacy licensure in their respective jurisdictions. State boards of pharmacy do not license or approve our medication and supply dispensing systems; however, pharmacies using our equipment are subject to state board approval. The failure of such pharmacies to meet differing requirements from a significant number of state boards of pharmacy could decrease demand for our products and harm our competitive position, results of operations and financial condition. Similarly, hospitals must be accredited by The Joint Commission in order to be eligible for Medicaid and Medicare funds. The Joint Commission does not approve or accredit medication and supply dispensing systems; however, disapproval of our customers’ medication and supply dispensing management methods and their failure to meet The Joint Commission requirements could decrease demand for our products and harm our competitive position, results of operations and financial condition.

While we have implemented a Privacy and Use of Information Policy and adhere to established privacy principles, use of customer information guidelines and related federal and state statutes, we cannot assure you that we will be in compliance with all federal and state healthcare information privacy and security laws that we are directly or indirectly subject to, including, without limitation, the Health Insurance Portability and Accountability Act of 1996, or HIPAA. Among other things, this legislation required the Secretary of Health and Human Services, or HHS, to adopt national standards governing the conduct of certain electronic health information transactions and protecting the privacy and security of personally identifiable health information maintained or transmitted by “covered entities,” which include pharmacies and other healthcare providers with which we do business.

The standards adopted to date include, among others, the “Standards for Privacy of Individually Identifiable Health Information,” which restrict the use and disclosure of personally identifiable health information by covered entities, and the “Security Standards,” which require covered entities to implement administrative, physical and technical safeguards to protect the integrity and security of certain electronic health information. Under HIPAA, we are considered a “business associate” in relation to many of our customers that are covered entities, and as such, most of these customers have required that we enter into written agreements governing the way we handle and safeguard certain patient health information we may encounter in providing our products and services and may impose liability on us for failure to meet our contractual obligations. Further,

44

pursuant to recent changes in HIPAA under the American Recovery and Reinvestment Act of 2009, or ARRA, we are now also covered under HIPAA similar to other covered entities and in some cases, subject to the same civil and criminal penalties as a covered entity. A number of states have also enacted privacy and security statutes and regulations that, in some cases, are more stringent than HIPAA and may also apply directly to us. If our past or present operations are found to violate any of these laws, we may be subject to fines, penalties and other sanctions. In addition, we cannot predict the potential impact of future HIPAA standards and other federal and state privacy and security laws that may be enacted at any time on our customers or on Omnicell. These laws could restrict the ability of our customers to obtain, use or disseminate patient information, which could reduce the demand for our products or force us to redesign our products in order to meet regulatory requirements.

Outstanding employee stock options have the potential to dilute stockholder value and cause our stock price to decline.

We grant stock options to our employees as incentives to join Omnicell or as an on-going reward and retention vehicle. At June 30, 2012, we had options outstanding to purchase approximately 4.7 million shares of our common stock at exercise prices ranging from $2.70 to $29.16 per share, at a weighted-average exercise price of $13.57 per share. If some or all of these shares are sold into the public market over a short time period, the price of our common stock may decline, as the market may not be able to absorb those shares at the prevailing market prices. Such sales may also make it more difficult for us to sell equity securities in the future on terms that we deem acceptable.

Changes in our tax rates, the adoption of new tax legislation or exposure to additional tax liabilities could affect our future results.

We are subject to taxes in the United States and other foreign jurisdictions. Our future effective tax rates could be affected by several factors, many of which are outside of our control, including: changes in the mix of earnings with differing statutory tax rates, changes in the valuation of deferred tax assets and liabilities, or changes in tax laws or their interpretation. We regularly assess the likelihood of adverse outcomes to determine the adequacy of our provision for taxes. We are also subject to examination of our income tax returns by the Internal Revenue Service and other tax authorities. There can be no assurance that the outcomes from these examinations will not materially adversely affect our financial condition and operating results.

Catastrophic events may disrupt our business and harm our operating results.

We rely on our network infrastructure, data centers, enterprise applications, and technology systems for the development, marketing, support and sales of our products, and for the internal operation of our business. These systems are susceptible to disruption or failure in the event of a major earthquake, fire, flood, cyber-attack, terrorist attack, telecommunications failure, or other catastrophic event. Many of these systems are housed or supported in or around our corporate headquarters located in California, near major earthquake faults, and where a significant portion of our research and development activities and other critical business operations take place. Other critical systems, including our manufacturing facilities for our consumable medication packages, are housed in St. Petersburg, Florida in communities that have been subject to significant tropical storms. Disruptions to or the failure of any of these systems, and the resulting loss of critical data, which is not quickly recoverable by the effective execution of disaster recovery plans designed to reduce such disruption, could cause delays in our product development, prevent us from fulfilling our customers’ orders, and could severely affect our ability to conduct normal business operations, the result of which would adversely affect our operating results.

Anti-takeover provisions in our charter documents, our stockholders’ rights plan and under Delaware law may make an acquisition of us, which may be beneficial to our stockholders, more difficult.

We are incorporated in Delaware. Certain anti-takeover provisions of Delaware law and our charter documents as currently in effect may make a change in control of our company more difficult, even if a change in control would be beneficial to the stockholders. Our anti-takeover provisions include provisions in our certificate of incorporation providing that stockholders’ meetings may only be called by our Board of Directors and provisions in our bylaws providing that the stockholders may not take action by written consent and requiring that stockholders that desire to nominate any person for election to our Board of Directors or to make any proposal with respect to business to be conducted at a meeting of our stockholders be submitted in appropriate form to our Secretary within a specified period of time in advance of any such meeting. Delaware law also prohibits corporations from engaging in a business combination with any holders of 15% or more of their capital stock until the holder has held the stock for three years unless, among other possibilities, our Board of Directors approves the transaction. Our Board of Directors may use these provisions to prevent changes in the management and control of our company. Also, under applicable Delaware law, our board of directors may adopt additional anti-takeover measures in the future.

45

In February 2003, our Board of Directors adopted a stockholder rights plan that may have the effect of discouraging, delaying or preventing a change in control of our company that may be beneficial to our stockholders. Pursuant to the terms of the plan, when a person or group, except under certain circumstances, acquires 15% or more of our outstanding common stock (other than two then current stockholders and their affiliated entities, which will not trigger the rights plan unless they acquire beneficial ownership of 17.5% and 22.5% or more, respectively, of our outstanding common stock) or ten business days after commencement or announcement of a tender or exchange offer for 15% or more of our outstanding common stock, the rights (except those rights held by the person or group who has acquired or announced an offer to acquire 15% or more of our outstanding common stock) would generally become exercisable for shares of our common stock at a discount. Because the potential acquirer’s rights would not become exercisable for our shares of common stock at a discount, the potential acquirer would suffer substantial dilution and may lose its ability to acquire us. In addition, the existence of the plan itself may deter a potential acquirer from acquiring us. As a result, either by operation of the plan or by its potential deterrent effect, a change in control of our company that our stockholders may consider in their best interests may not occur.

Item 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

The following table sets forth the number of shares of common stock repurchased by us during the three months ended June 30, 2012:

Period	Total number of shares (or units) purchased	Average price paid per share (or unit), including commissions		Total number of Shares (or units) purchased as part of publicly announced plans or programs	Maximum number (or approximate dollar value) of shares (or units) that may yet be purchased under the plans or programs
April 1—30, 2012	244,687	$	14.00	244,687	$	8.9	million
May 1—31, 2012	—	—		—	$	8.9	million
June 1—30, 2012	260,450	$	13.95	260,450	$	5.3	million
Total	505,137	$	13.98	505,137

Item 3. DEFAULTS UPON SENIOR SECURITIES

None.

Item 4. MINE SAFETY DISCLOSURES

Not applicable.

Item 5. OTHER INFORMATION

None.

46

Item 6. EXHIBITS

Exhibit No.	Exhibit Title
2.1(1)	Agreement and Plan of Merger, dated as of April 26, 2012, by and among Omnicell, Inc., Mercury Acquisition Corp, MedPak Holdings, Inc. and Excellere Capital Management, LLC.
3.1(2)	Amended and Restated Certificate of Incorporation of Omnicell, Inc.
3.2(3)	Certificate of Amendment to the Amended and Restated Certificate of Incorporation of Omnicell, Inc.
3.3(4)	Certificate of Designation of Series A Junior Participating Preferred Stock.
3.4(5)	Bylaws of Omnicell, Inc., as amended.
4.1(2)	Form of Common Stock Certificate.
4.2	Reference is made to Exhibits 3.1, 3.2, 3.3 and 3.4.
4.3(6)	Rights Agreement, dated February 6, 2003, between Omnicell, Inc. and EquiServe Trust Company, N.A.
10.1*	Omnicell, Inc. Amended and Restated Severance Benefit Plan.
10.2*	Offer Letter, dated May 24, 2012, between Omnicell, Inc. and William Shields.
10.3*	Change of Control Agreement, dated May 23, 2012, between Omnicell, Inc. and William Shields and Addendum thereto dated June 24, 2012.
10.4*	Form of Restricted Stock Unit Award Agreement for the 2009 Equity Incentive Plan, as amended.
10.5*	Form of Performance Cash Award Grant Notice and Form of Performance Cash Award Agreement for the 2009 Equity Incentive Plan, as amended.
10.6	Lease, between Medical Technologies Systems, Inc. and Gateway Business Centre, Ltd., dated March 31, 2004.
10.7	First Lease Amendment, between Medical Technology Systems, Inc. and Gateway Business Centre, Ltd., dated July 26, 2004.
10.8	Lease, between MTS Medication Technologies, Ltd. and SAL Pension Fund, Ltd., dated June 9, 2011.
31.1	Certification of Chief Executive Officer required by Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended.
31.2	Certification of Chief Financial Officer required by Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended.
32.1	Certifications required by Rule 13a-14(b) or Rule 15d-14(b) of the Securities Exchange Act of 1934, as amended, and Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C. Section 1350).
101.INS(7)	XBRL Instance Document.
101.SCH(7)	XBRL Taxonomy Extension Schema Document.
101.CAL (7)	XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF(7)	XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB(7)	XBRL Taxonomy Extension Label Linkbase Document.
101.PRE(7)	XBRL Taxonomy Extension Presentation Linkbase Document.

* Management contract or compensatory plan or arrangement

(1) Previously filed as Exhibit 2.1 to the Registrant's Current Report on Form 8-K (File No. 000-33043) filed with the Securities Exchange Commission on May 2, 2012, and incorporated herein by reference.

(2) Previously filed as an exhibit to the Registrant’s Registration Statement on Form S-1 (File No. 333-57024), and amendments thereto, originally filed with the Securities and Exchange Commission on March 14, 2001, and incorporated herein by reference.

(3) Previously filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q (File No. 000-33043) filed with the Securities and Exchange Commission on August 9, 2010, and incorporated herein by reference.

(4) Previously filed as an exhibit to the Registrant’s Annual Report on Form 10-K (File No. 000-33043), and amendments thereto, originally filed with the Securities and Exchange Commission on March 28, 2003, and incorporated herein by reference.

(5) Previously filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q (File No. 000-33043) filed with the Securities and Exchange Commission on August 9, 2007, and incorporated herein by reference.

47

(6) Previously filed as an exhibit to the Registrant’s Current Report on Form 8-K (File No. 000-33043) filed with the Securities and Exchange Commission on February 14, 2003, and incorporated herein by reference.

(7) Pursuant to applicable securities laws and regulations, we are deemed to have complied with the reporting obligation relating to the submission of interactive data files in such exhibits and are not subject to liability under any anti-fraud provisions of the federal securities laws as long as we have made a good faith attempt to comply with the submission requirements and promptly amend the interactive data files after becoming aware that the interactive data files fails to comply with the submission requirements. Users of this data are advised that, pursuant to Rule 406T, these interactive data files are deemed not filed or part of a registration statement or prospectus for purposes of sections 11 or 12 of the Securities Act, are deemed not filed for purposes of section 18 of the Exchange Act and otherwise are not subject to liability under these sections.

48

SIGNATURES

Pursuant to the requirements 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.

	OMNICELL, INC.
Date: August 9, 2012
	/s/ ROBIN G. SEIM
	Robin G. Seim
	Duly Authorized Officer, Chief Financial Officer and Vice President Finance, Administration and Manufacturing

49

INDEX TO EXHIBITS    

Exhibit No.	Exhibit Title
2.1(1)	Agreement and Plan of Merger, dated as of April 26, 2012, by and among Omnicell, Inc., Mercury Acquisition Corp, MedPak Holdings, Inc. and Excellere Capital Management, LLC.
3.1(2)	Amended and Restated Certificate of Incorporation of Omnicell, Inc.
3.2(3)	Certificate of Amendment to the Amended and Restated Certificate of Incorporation of Omnicell, Inc.
3.3(4)	Certificate of Designation of Series A Junior Participating Preferred Stock.
3.4(5)	Bylaws of Omnicell, Inc., as amended.
4.1(2)	Form of Common Stock Certificate.
4.2	Reference is made to Exhibits 3.1, 3.2, 3.3 and 3.4.
4.3(6)	Rights Agreement, dated February 6, 2003, between Omnicell, Inc. and EquiServe Trust Company, N.A.
10.1*	Omnicell, Inc. Amended and Restated Severance Benefit Plan.
10.2*	Offer Letter, dated May 24, 2012, between Omnicell, Inc. and William Shields.
10.3*	Change of Control Agreement, dated May 23, 2012, between Omnicell, Inc. and William Shields and Addendum thereto dated June 24, 2012.
10.4*	Form of Restricted Stock Unit Award Agreement for the 2009 Equity Incentive Plan, as amended.
10.5*	Form of Performance Cash Award Grant Notice and Form of Performance Cash Award Agreement for the 2009 Equity Incentive Plan, as amended.
10.6	Lease, between Medical Technologies Systems, Inc. and Gateway Business Centre, Ltd., dated March 31, 2004.
10.7	First Lease Amendment, between Medical Technology Systems, Inc. and Gateway Business Centre, Ltd., dated July 26, 2004.
10.8	Lease, between MTS Medication Technologies, Ltd. and SAL Pension Fund, Ltd., dated June 9, 2011.
31.1	Certification of Chief Executive Officer required by Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended.
31.2	Certification of Chief Financial Officer required by Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended.
32.1	Certifications required by Rule 13a-14(b) or Rule 15d-14(b) of the Securities Exchange Act of 1934, as amended, and Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C. Section 1350).
101.INS(7)	XBRL Instance Document.
101.SCH(7)	XBRL Taxonomy Extension Schema Document.
101.CAL (7)	XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF(7)	XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB(7)	XBRL Taxonomy Extension Label Linkbase Document.
101.PRE(7)	XBRL Taxonomy Extension Presentation Linkbase Document.

* Management contract or compensatory plan or arrangement

(1) Previously filed as Exhibit 2.1 to the Registrant's Current Report on Form 8-K (File No. 000-33043) filed with the Securities Exchange Commission on May 2, 2012, and incorporated herein by reference.

(2) Previously filed as an exhibit to the Registrant’s Registration Statement on Form S-1 (File No. 333-57024), and amendments thereto, originally filed with the Securities and Exchange Commission on March 14, 2001, and incorporated herein by reference.

(3) Previously filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q (File No. 000-33043) filed with the Securities and Exchange Commission on August 9, 2010, and incorporated herein by reference.

(4) Previously filed as an exhibit to the Registrant’s Annual Report on Form 10-K (File No. 000-33043), and amendments thereto, originally filed with the Securities and Exchange Commission on March 28, 2003, and incorporated herein by

50

reference.

(5) Previously filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q (File No. 000-33043) filed with the Securities and Exchange Commission on August 9, 2007, and incorporated herein by reference.

(6) Previously filed as an exhibit to the Registrant’s Current Report on Form 8-K (File No. 000-33043) filed with the Securities and Exchange Commission on February 14, 2003, and incorporated herein by reference.

(7) Pursuant to applicable securities laws and regulations, we are deemed to have complied with the reporting obligation relating to the submission of interactive data files in such exhibits and are not subject to liability under any anti-fraud provisions of the federal securities laws as long as we have made a good faith attempt to comply with the submission requirements and promptly amend the interactive data files after becoming aware that the interactive data files fails to comply with the submission requirements. Users of this data are advised that, pursuant to Rule 406T, these interactive data files are deemed not filed or part of a registration statement or prospectus for purposes of sections 11 or 12 of the Securities Act, are deemed not filed for purposes of section 18 of the Exchange Act and otherwise are not subject to liability under these sections.

(*) Compensation-related agreement

51

EX-10.1

Exhibit 10.1

OMNICELL, INC.

AMENDED AND RESTATED SEVERANCE BENEFIT PLAN

SECTION 1.INTRODUCTION.

The Amended and Restated Omnicell, Inc. Severance Benefit Plan (the “Plan”) was originally established effective January 3, 2007, was amended and restated effective May 2, 2007 and is hereby amended and restated effective June 20, 2009 (the “Effective Date”). The purpose of the Plan is to provide for the payment of severance benefits to certain eligible employees of Omnicell, Inc. (the “Company”) and Company affiliates, if any, that have been designated by the Company on the attached Appendix A as eligible to participate in the Plan (each such affiliate, an “Employer” and all such affiliates collectively, the “Employers”) whose employment with the Company or an Employer is involuntarily terminated and who meets the eligibility criteria set forth in Section 2(a) below. This Plan shall supersede any severance benefit plan, policy or practice previously maintained by the Company or any Employer. This Plan document also is the Summary Plan Description for the Plan.

SECTION 2.ELIGIBILITY FOR BENEFITS.

(a)General Rules.  Subject to the requirements set forth in this Section, the Company will grant severance benefits under the Plan to Eligible Employees.

(1)Definition of “Eligible Employee.” For purposes of this Plan, an Eligible Employee is a full-time regular hire employee of the Company or any Employer, who is notified by the Company in writing that he or she is eligible for participation in the Plan and (i) whose employment is involuntarily terminated by the Company or an Employer without Cause (as defined in Section 2(c) below); or (ii) whose employment is terminated as a result of a reduction-in-force; or (iii) who is selected by the Plan Administrator in its sole discretion to receive the benefits set forth herein. The determination of whether an employee is an Eligible Employee shall be made by the Company, in its sole discretion, and such determination shall be binding and conclusive on all persons. For purposes of this Plan, full-time regular hire employees are those employees who are regularly scheduled to work at least thirty-two (32) hours per week. Regular hire employees who are regularly scheduled to work fewer than thirty-two (32) hours per week and temporary employees are not eligible for severance benefits under the Plan.

(2)In order to be eligible to receive any benefits under the Plan, an Eligible Employee must remain on the job until his or her date of termination as scheduled by the Company.

(3)In order to be eligible to receive any benefits under the Plan, an Eligible Employee also must execute a general waiver and release in substantially the form attached hereto as Exhibit A, Exhibit B or Exhibit C, as appropriate, within the applicable time period set forth therein, but in no event more than sixty (60) days following the date of termination, or as may be updated by the Company from time to time, and such release must become effective in accordance with its terms. The Company, in its discretion, may modify the form of the required release to comply with applicable law and shall determine the form of the required release, which may be incorporated into a termination agreement or other agreement with the Eligible Employee.

(b)Exceptions to Benefit Entitlement.  An employee, including an employee who otherwise is an Eligible Employee, will not receive benefits under the Plan (or will receive reduced benefits under the Plan) in the following circumstances, as determined by the Company in its sole discretion:

(1)The employee has executed an individually negotiated employment contract or agreement with the Company or an Employer relating to severance benefits that is in effect on his or her termination date, and the employee has not elected in writing to the Company’s Vice President of Human Resources (or such other Company officer as the Company may direct in writing) as of employee’s termination date to be governed solely by this Plan, in which case such employee’s severance benefit, if any, shall be governed by the terms of such

1

individually negotiated employment contract or agreement and shall be governed by this Plan only to the extent that the reduction pursuant to Section 3(c) below does not entirely eliminate benefits under this Plan.

(2)The employee voluntarily terminates employment with the Company or an Employer. Voluntary terminations include, but are not limited to, resignation, retirement or failure to return from a leave of absence on the scheduled date.

(3)The employee voluntarily terminates employment with the Company or an Employer in order to accept employment with another entity that is wholly or partly owned (directly or indirectly) by the Company or an affiliate of the Company.

(4)The employee is offered an identical or substantially equivalent or comparable position with the Company or an affiliate of the Company. For purposes of the foregoing, a “substantially equivalent or comparable position” is one that offers the employee substantially the same level of base salary and does not require a relocation of the employee’s place of employment by more than fifty (50) miles from its previous location.

(5)The employee is offered immediate reemployment by a successor to the Company or an affiliate of the Company or by a purchaser of its assets, as the case may be, following a change in ownership of the Company or an Employer or a sale of substantially all of the assets of a division or business unit of the Company or an Employer. For purposes of the foregoing, “immediate reemployment” means that the employee’s employment with the successor to the Company or an affiliate of the Company or the purchaser of its assets, as the case may be, results in uninterrupted employment such that the employee does not incur a lapse in pay as a result of the change in ownership of the Company or an Employer or the sale of its assets.

(6)The employee is offered immediate reemployment by a third party entity to whom the Company or an affiliate of the Company has outsourced or otherwise transferred the employee’s job responsibilities. For purposes of the foregoing, “immediate reemployment” means that the employee’s employment with the third party entity to whom the employee’s job responsibilities have been outsourced or otherwise transferred, as the case may be, results in uninterrupted employment such that the employee does not incur a lapse in pay as a result of the outsourcing or other transfer.

(7)The employee is rehired by the Company or an affiliate of the Company prior to the date benefits under the Plan are scheduled to commence.

(8)The employee does not confirm in writing that he or she is and shall remain subject to the Company’s Proprietary Information and Inventions Agreement.

(9)Following notification of involuntary termination by the Company, the employee does not satisfactorily perform his or her assigned job duties until the date set by the Company or an Employer for the termination of employment.

(c)An involuntary termination without “Cause” means an involuntary termination of an employee’s employment by the Company or an Employer other than for one of the following reasons:

(1)an intentional action or intentional failure to act by the employee that was performed in bad faith;

(2)an employee’s intentional refusal or intentional failure to act in accordance with any lawful and proper direction or order of his or her superiors;

(3)an employee’s habitual neglect of the duties of employment, which may include a failure to perform her or her job duties satisfactorily;

(4)an employee’s indictment, charge, or conviction of a felony or any crime

2

involving moral turpitude, or participation in any act of theft or dishonesty, regardless of whether such act has had or could reasonably be expected to have a material detrimental effect on the business of the Company or an Employer; or

(5)an employee’s violation of any material provision of the Company’s Proprietary Information and Inventions Agreement or violation of any material provision of any other written Company or Employer policy or procedure.

SECTION 3.AMOUNT OF BENEFIT.

(a)Severance Benefits.  Subject to the exceptions set forth in Section 2(b), severance benefits under the Plan, if any, shall be provided to Eligible Employees described in Section 2(a) in the amount provided in Appendix B.

(b)Additional Benefits.  Notwithstanding the foregoing, the Company may, in its sole discretion, provide benefits in addition to those benefits set forth in Section 3(a) to Eligible Employees and the provision of any such benefits to an Eligible Employee shall in no way obligate the Company to provide such benefits to any other Eligible Employee or to any other employee, even if similarly situated.

(c)Certain Reductions.  The Company, in its sole discretion, shall have the authority to reduce an Eligible Employee’s severance benefits, in whole or in part, by any other severance benefits, pay in lieu of notice, or other similar benefits payable to the Eligible Employee by the Company or an affiliate of the Company that become payable in connection with the Eligible Employee’s termination of employment pursuant to (i) any applicable legal requirement, including, without limitation, the Worker Adjustment and Retraining Notification Act, the California Plant Closing Act, or any other similar state law, (ii) a written employment or severance agreement with the Company or an Employer of the Company, or (iii) any Company or Employer policy or practice providing for the Eligible Employee to remain on the payroll for a limited period of time after being given notice of the termination of the Eligible Employee’s employment, and the Plan Administrator shall so construe and implement the terms of the Plan; provided, however, that notwithstanding the foregoing and any other provision in the Plan to the contrary, such reduction shall in no event reduce the cash severance benefits provided under this Plan to less than one (1) week of Base Salary (as such term is defined in Appendix B). The Company’s decision to apply such reductions to the severance benefits of one Eligible Employee and the amount of such reductions shall in no way obligate the Company to apply the same reductions in the same amounts to the severance benefits of any other Eligible Employee, even if similarly situated. In the Company’s sole discretion, such reductions may be applied on a retroactive basis, with severance benefits previously paid being re-characterized as payments pursuant to the Company’s statutory obligation.

SECTION 4.COMPANY PROPERTY.

(a)Return of Company Property.  Except as provided in Section 4(b) below, an Eligible Employee will not be entitled to any severance benefit under the Plan unless and until the Eligible Employee returns all Company Property. For this purpose, “Company Property” means all Company and/or Employer documents (and all copies thereof) and other Company and/or Employer property which the Eligible Employee had in his or her possession at any time, including, but not limited to, Company and/or Employer files, notes, drawings records, plans, forecasts, reports, studies, analyses, proposals, agreements, financial information, research and development information, sales and marketing information, operational and personnel information, specifications, code, software, databases, computer-recorded information, tangible property and equipment (including, but not limited to, leased vehicles, computers, facsimile machines, mobile telephones, servers), credit cards, entry cards, identification badges and keys; and any materials of any kind which contain or embody any proprietary or confidential information of the Company and/or an Employer (and all reproductions thereof in whole or in part). As a condition to receiving benefits under the Plan, Eligible Employees must not make or retain copies, reproductions or summaries of any such Company or Employer property. In the Company’s sole discretion, the Company may determine the value of any unreturned Company property and deduct the value of such property from any severance benefits otherwise owed to the employee under this Plan.

3

(b)Retention of Certain Company Equipment.  Notwithstanding the provisions of Section 4(a), the Company and an Eligible Employee may agree to allow the Eligible Employee to retain certain Company or Employer equipment (e.g., laptops, printers, facsimile machines, copiers, etc.) (“Company Equipment”) for his or her personal use following the Eligible Employee’s termination of employment. As a condition to retaining any Company Equipment, the Eligible Employee must execute a general waiver and release in substantially the form attached hereto as Exhibit A, Exhibit B or Exhibit C, as appropriate, within the applicable time period set forth therein, but in no event more than sixty (60) days following the date of termination, and such release must become effective in accordance with its terms. The Eligible Employee acknowledges that the Eligible Employee will have imputed income related to the retention of any Company Equipment. The Eligible Employee will follow all Company instructions as to the return and/or deletion of any Company information contained on the Company Equipment.

SECTION 5.TIME OF PAYMENT AND FORM OF BENEFIT.

All cash severance benefits under the Plan shall be paid in a single lump sum as soon as administratively practicable following the Eligible Employee’s satisfaction of all of the requirements set forth in Sections 2(a) and 4(a). All payments under the Plan will be subject to applicable withholding for federal, state and local taxes. If an Eligible Employee is indebted to the Company at his or her termination date, the Company reserves the right to offset any severance payments under the Plan by the amount of such indebtedness. Additionally, if an Eligible Employee is subject to withholding for taxes related to any non-Plan benefits, including but not limited to any imputed income related to the use of Company vehicles for personal travel, or imputed income related to retention of Company Equipment, the Company may offset any severance payments under the Plan by the amount of such withholding taxes.

Notwithstanding anything to the contrary set forth herein, any payments and benefits provided under the Plan that constitute “deferred compensation” within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) and the regulations and other guidance thereunder and any state law of similar effect (collectively “Section 409A”) shall not commence in connection with an Eligible Employee’s termination of employment unless and until the Eligible Employee has also incurred a “separation from service” (as such term is defined in Treasury Regulations Section 1.409A-1(h) (“Separation From Service”)), unless the Company reasonably determines that such amounts may be provided to the Eligible Employee without causing the Eligible Employee to incur the adverse personal tax consequences under Section 409A.

It is intended that (i) each installment of any benefits payable under the Plan to an Eligible Employee be regarded as a separate “payment” for purposes of Treasury Regulations Section 1.409A-2(b)(2)(i), (ii) all payments of any such benefits under the Plan satisfy, to the greatest extent possible, the exemptions from the application of Section 409A provided under Treasury Regulations Sections 1.409A-1(b)(4) and 1.409A-1(b)(9)(iii), and (iii) any such benefits consisting of COBRA premiums also satisfy, to the greatest extent possible, the exemption from the application of Section 409A provided under Treasury Regulations Section 1.409A-1(b)(9)(v). However, if the Company determines that any such benefits payable under the Plan constitute “deferred compensation” under Section 409A and the Eligible Employee is a “specified employee” of the Company, as such term is defined in Section 409A(a)(2)(B)(i), then, solely to the extent necessary to avoid the imposition of the adverse personal tax consequences under Section 409A, the timing of such benefit payments shall be delayed as follows: on the earlier to occur of (A) the date that is six (6) months and one (1) day after the Eligible Employee’s Separation From Service and (B) the date of the Eligible Employee’s death (such applicable date, the “Delayed Initial Payment Date”), the Company shall (1) pay the Eligible Employee a lump sum amount equal to the sum of the benefit payments that the Eligible Employee would otherwise have received through the Delayed Initial Payment Date if the commencement of the payment of the benefits had not been delayed pursuant to this paragraph and (2) commence paying the balance, if any, of the benefits in accordance with the applicable payment schedule.

SECTION 6.REEMPLOYMENT.

In the event of an Eligible Employee’s reemployment by the Company or an Employer or other affiliate of the Company or by a company to whom the employee’s job responsibilities have been outsourced or

4

otherwise transferred during the period of time in respect of which severance benefits pursuant to Sections 3(a) and 3(b) have been paid, the Company, in its sole and absolute discretion, may require such Eligible Employee to repay to the Company all or a portion of such severance benefits as a condition of reemployment.

SECTION 7.RIGHT TO INTERPRET PLAN; AMENDMENT AND TERMINATION.

(a)Exclusive Discretion.  The Plan Administrator (as defined in Section 10(a) herein) shall have the exclusive discretion and authority to establish rules, forms, and procedures for the administration of the Plan and to construe and interpret the Plan and to decide any and all questions of fact, interpretation, definition, computation or administration arising in connection with the operation of the Plan, including, but not limited to, the eligibility to participate in the Plan and amount of benefits paid under the Plan. The rules, interpretations, computations and other actions of the Plan Administrator shall be binding and conclusive on all persons.

(b)Amendment or Termination.  The Company reserves the right to amend or terminate this Plan (including Appendix A and Appendix B) or the benefits provided hereunder at any time; provided, however, that no such amendment or termination shall adversely affect the right to any unpaid benefit of any Eligible Employee whose termination date has occurred prior to amendment or termination of the Plan. Any action amending or terminating the Plan shall be in writing and executed by the Chief Executive Officer or the Chief Financial Officer of the Company.

SECTION 8.NO IMPLIED EMPLOYMENT CONTRACT.

The Plan shall not be deemed (i) to give any employee or other person any right to be retained in the employ of the Company or an Employer or (ii) to interfere with the right of the Company or an Employer to discharge any employee or other person at any time, with or without cause, which right is hereby reserved.

SECTION 9.LEGAL CONSTRUCTION.

This Plan is intended to be governed by and shall be construed in accordance with the Employee Retirement Income Security Act of 1974 (“ERISA”) and, to the extent not preempted by ERISA, the laws of the State of California (without regard to principles of conflict of laws).

SECTION 10.CLAIMS, INQUIRIES AND APPEALS.

(a)Applications for Benefits and Inquiries.  Any application for benefits, inquiries about the Plan or inquiries about present or future rights under the Plan must be submitted to the Plan Administrator in writing by an applicant (or his or her authorized representative). The Plan Administrator is:

Omnicell, Inc.

Attn: Human Resources Manager

1201 Charleston Road

Mountain View, CA 94043

(b)Denial of Claims.  In the event that any application for benefits is denied in whole or in part, the Plan Administrator must provide the applicant with written or electronic notice of the denial of the application, and of the applicant’s right to review the denial. Any electronic notice will comply with the regulations of the U.S. Department of Labor. The notice of denial will be set forth in a manner designed to be understood by the applicant and will include the following:

5

(1)the specific reason or reasons for the denial;

(2)references to the specific Plan provisions upon which the denial is based;

(3)a description of any additional information or material that the Plan Administrator needs to complete the review and an explanation of why such information or material is necessary; and

(4)an explanation of the Plan’s review procedures and the time limits applicable to such procedures, including a statement of the applicant’s right to bring a civil action under Section 502(a) of ERISA following a denial on review of the claim, as described in Section 10(d) below.

This notice of denial will be given to the applicant within ninety (90) days after the Plan Administrator receives the application, unless special circumstances require an extension of time, in which case, the Plan Administrator has up to an additional ninety (90) days for processing the application. If an extension of time for processing is required, written notice of the extension will be furnished to the applicant before the end of the initial ninety (90) day period.

This notice of extension will describe the special circumstances necessitating the additional time and the date by which the Plan Administrator is to render its decision on the application.

(c)Request for a Review. Any person (or that person’s authorized representative) for whom an application for benefits is denied, in whole or in part, may appeal the denial by submitting a request for a review to the Plan Administrator within sixty (60) days after the application is denied. A request for a review shall be in writing and shall be addressed to:

Omnicell, Inc.

Attn: Vice President, Human Resources

1201 Charleston Road

Mountain View, CA 94043

A request for review must set forth all of the grounds on which it is based, all facts in support of the request and any other matters that the applicant feels are pertinent. The applicant (or his or her representative) shall have the opportunity to submit (or the Plan Administrator may require the applicant to submit) written comments, documents, records, and other information relating to his or her claim. The applicant (or his or her representative) shall be provided, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information relevant to his or her claim. The review shall take into account all comments, documents, records and other information submitted by the applicant (or his or her representative) relating to the claim, without regard to whether such information was submitted or considered in the initial benefit determination.

(d)Decision on Review.  The Plan Administrator will act on each request for review within sixty (60) days after receipt of the request, unless special circumstances require an extension of time (not to exceed an additional sixty (60) days), for processing the request for a review. If an extension for review is required, written notice of the extension will be furnished to the applicant within the initial sixty (60) day period. This notice of extension will describe the special circumstances necessitating the additional time and the date by which the Plan Administrator is to render its decision on the review. The Plan Administrator will give prompt, written or electronic notice of its decision to the applicant. Any electronic notice will comply with the regulations of the U. S.

6

Department of Labor. In the event that the Plan Administrator confirms the denial of the application for benefits in whole or in part, the notice will set forth, in a manner calculated to be understood by the applicant, the following:

(1)the specific reason or reasons for the denial;

(2)references to the specific Plan provisions upon which the denial is based;

(3)a statement that the applicant is entitled to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information relevant to his or her claim; and

(4)a statement of the applicant’s right to bring a civil action under Section 502(a) of ERISA.

(e)Rules and Procedures.  The Plan Administrator will establish rules and procedures, consistent with the Plan and with ERISA, as necessary and appropriate in carrying out its responsibilities in reviewing benefit claims. The Plan Administrator may require an applicant who wishes to submit additional information in connection with an appeal from the denial of benefits to do so at the applicant’s own expense.

(f)Exhaustion of Remedies.  No legal action for benefits under the Plan may be brought until the applicant (i) has submitted a written application for benefits in accordance with the procedures described by Section 10(a) above, (ii) has been notified by the Plan Administrator that the application is denied, (iii) has filed a written request for a review of the application in accordance with the appeal procedure described in Section 10(c) above, and (iv) has been notified that the Plan Administrator has denied the appeal. Notwithstanding the foregoing, if the Plan Administrator does not respond to an applicant’s claim or appeal within the relevant time limits specified in this Section 10, the applicant may bring legal action for benefits under the Plan pursuant to Section 502(a) of ERISA.

SECTION 11.BASIS OF PAYMENTS TO AND FROM PLAN.

The Plan shall be unfunded, and all cash payments under the Plan shall be paid only from the general assets of the Company. An Eligible Employee’s right to receive payments under the Plan is no greater than that of the Company’s unsecured general creditors. Therefore, if the Company were to become insolvent, the Eligible Employee might not receive benefits under the Plan.

SECTION 12.OTHER PLAN INFORMATION.

(a)Employer and Plan Identification Numbers. The Employer Identification Number assigned to the Company (which is the “Plan Sponsor” as that term is used in ERISA) by the Internal Revenue Service is 94-3166458. The Plan Number assigned to the Plan by the Plan Sponsor pursuant to the instructions of the Internal Revenue Service is 510.

(b)Ending Date for Plan’s Fiscal Year and Type of Plan.  The date of the end of the fiscal year for the purpose of maintaining the Plan’s records is December 31. The Plan is a welfare benefit plan.

(c)Agent for the Service of Legal Process.  The agent for the service of legal process with respect to the Plan is:

Omnicell, Inc.

Attn: Corporate Secretary

7

1201 Charleston Road

Mountain View, CA 94043

(d)Plan Sponsor and Administrator.  The Plan Sponsor and the “Plan Administrator” of the Plan is:

Omnicell, Inc.

Attn: Vice President, Human Resources

1201 Charleston Road

Mountain View, CA 94043

The Plan Sponsor’s and Plan Administrator’s telephone number is (650) 251- 6100. The Plan Administrator is the named fiduciary charged with the responsibility for administering the Plan.

SECTION 13.STATEMENT OF ERISA RIGHTS.

Participants in this Plan are entitled to certain rights and protections under ERISA. If you are an Eligible Employee, you are considered a participant in the Plan and, under ERISA, you are entitled to:

(a)Receive Information About Your Plan and Benefits

(1)Examine, without charge, at the Plan Administrator’s office and at other specified locations, such as worksites, all documents governing the Plan and a copy of the latest annual report (Form 5500 Series), if applicable, filed by the Plan with the U.S. Department of Labor and available at the Public Disclosure Room of the Employee Benefits Security Administration;

(2)Obtain, upon written request to the Plan Administrator, copies of documents governing the operation of the Plan and copies of the latest annual report (Form 5500 Series), if applicable, and an updated (as necessary) Summary Plan Description. The Administrator may make a reasonable charge for the copies; and

(3)Receive a summary of the Plan’s annual financial report, if applicable. The Plan Administrator is required by law to furnish each participant with a copy of this summary annual report.

(b)Prudent Actions by Plan Fiduciaries.  In addition to creating rights for Plan participants, ERISA imposes duties upon the people who are responsible for the operation of the employee benefit plan. The people who operate the Plan, called “fiduciaries” of the Plan, have a duty to do so prudently and in the interest of you and other Plan participants and beneficiaries. No one, including your employer, your union or any other person, may fire you or otherwise discriminate against you in any way to prevent you from obtaining a Plan benefit or exercising your rights under ERISA.

(c)Enforce Your Rights.  If your claim for a Plan benefit is denied or ignored, in whole or in part, you have a right to know why this was done, to obtain copies of documents relating to the decision without charge, and to appeal any denial, all within certain time schedules as set forth in detail in Section 10 herein.

Under ERISA, there are steps you can take to enforce the above rights. For instance, if

8

you request a copy of Plan documents or the latest annual report from the Plan, if applicable, and do not receive them within 30 days, you may file suit in a Federal court and you are not required to follow the claims procedure set forth in Section 10 herein. In such a case, the court may require the Plan Administrator to provide the materials and pay you up to $110 a day until you receive the materials, unless the materials were not sent because of reasons beyond the control of the Plan Administrator.

If you have completed the claims and appeals procedure described in Section 10 and have a claim for benefits which is denied or ignored, in whole or in part, you may file suit in a state or Federal court.

If you are discriminated against for asserting your rights, you may seek assistance from the U.S. Department of Labor, or you may file suit in a Federal court. The court will decide who should pay court costs and legal fees. If you are successful, the court may order the person you have sued to pay these costs and fees. If you lose, the court may order you to pay these costs and fees, for example, if it finds your claim is frivolous.

(d)Assistance with Your Questions.  If you have any questions about the Plan, you should contact the Plan Administrator. If you have any questions about this statement or about your rights under ERISA, or if you need assistance in obtaining documents from the Plan Administrator, you should contact the nearest office of the Employee Benefits Security Administration, U. S. Department of Labor, listed in your telephone directory or the Division of Technical Assistance and Inquiries, Employee Benefits Security Administration, U.S. Department of Labor, 200 Constitution Avenue N.W., Washington, D.C. 20210. You may also obtain certain publications about your rights and responsibilities under ERISA by calling the publications hotline of the Employee Benefits Security Administration or accessing its website at http://www.dol.gov/ebsa/.

SECTION 14.GENERAL PROVISIONS.

(a)Notices.  Any notice, demand or request required or permitted to be given by either the Company or an Eligible Employee pursuant to the terms of this Plan shall be in writing and shall be deemed given when delivered personally or deposited in the U.S. mail, First Class with postage prepaid, and addressed to the parties, in the case of the Company, at the address set forth in Section 12(d) and, in the case of an Eligible Employee, at the address as set forth in the Company’s employment file maintained for the Eligible Employee as previously furnished by the Eligible Employee or such other address as a party may request by notifying the other in writing.

(b)Transfer and Assignment. The rights and obligations of an Eligible Employee under this Plan may not be transferred or assigned without the prior written consent of the Company. This Plan shall be binding upon any person who is a successor by merger, acquisition, consolidation or otherwise to the business formerly carried on by the Company without regard to whether or not such person or entity actively assumes the obligations hereunder.

(c)Waiver.  Any party’s failure to enforce any provision or provisions of this Plan shall not in any way be construed as a waiver of any such provision or provisions, nor prevent any party from thereafter enforcing each and every other provision of this Plan. The rights granted the parties herein are cumulative and shall not constitute a waiver of any party’s right to assert all other legal remedies available to it under the circumstances.

(d)Severability.  Should any provision of this Plan be declared or determined to be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired.

(e)Section Headings.  Section headings in this Plan are included for convenience of reference only and shall not be considered part of this Plan for any other purpose.

Omnicell, Inc. has caused its duly authorized officer to execute the amendment and restatement of this Plan effective as of June 20, 2009.

9

OMNICELL, INC.

By:

Title:

10

For Employees Age 40 or Older

Individual Termination

EXHIBIT A

RELEASE AGREEMENT

I understand and agree completely to the terms set forth in the Omnicell, Inc. Severance Benefit Plan (the “Plan”).

I understand that this Release, together with the Plan, constitutes the complete, final and exclusive embodiment of the entire agreement between the Company, affiliates of the Company and me with regard to the subject matter hereof. I am not relying on any promise or representation by the Company or the Employer that is not expressly stated therein. Certain capitalized terms used in this Release are defined in the Plan.

I hereby confirm my obligations under my Proprietary Information and Inventions Agreement with the Company and/or the Employer.

In exchange for the Severance Benefits and other consideration provided to me by the Plan that I am not otherwise entitled to receive, and except as otherwise set forth in this Release, I hereby generally and completely release the Company, the Employers, and their current and former parents, subsidiaries, successors, predecessors and affiliates, and their current and former partners, members, directors, officers, employees, stockholders, shareholders, agents, attorneys, predecessors, insurers, affiliates and assigns, from any and all claims, liabilities and obligations, both known and unknown, that arise out of or are in any way related to events, acts, conduct, or omissions occurring at any time prior to and including the date I sign this Release. This general release includes, but is not limited to: (a) all claims arising out of or in any way related to my employment with the Company, the Employers or their affiliates, or the termination of that employment; (b) all claims related to my compensation or benefits, including salary, bonuses, commissions, vacation pay, expense reimbursements, severance pay, fringe benefits, stock, stock options, or any other ownership interests in the Company, the Employers, or their affiliates; (c) all claims for breach of contract, wrongful termination, and breach of the implied covenant of good faith and fair dealing; (d) all tort claims, including claims for fraud, defamation, emotional distress, and discharge in violation of public policy; and (e) all federal, state, and local statutory claims, including claims for discrimination, harassment, retaliation, attorneys’ fees, or other claims arising under the federal Civil Rights Act of 1964 (as amended), the federal Americans with Disabilities Act of 1990 (as amended), the federal Age Discrimination in Employment Act (as amended) (“ADEA”), the federal Employee Retirement Income Security Act of 1974 (as amended), and the California Fair Employment and Housing Act (as amended).

I am not releasing any claim that cannot be waived under applicable state or federal law or any rights I have to pursue a claim for workers’ compensation or unemployment benefits, and I am not releasing any rights that I have to be indemnified (including any right to reimbursement of expenses) arising under applicable law, the certificate of incorporation or by-laws (or similar constituent documents of the Company), any indemnification agreement between me and the Company, the Employers, or their affiliates, or any directors’ and officers’ liability insurance policy of the Company, the Employers, or their affiliates. The foregoing notwithstanding, nothing in this Release shall prevent me from filing, cooperating with, or participating in any proceeding before the Equal Employment Opportunity Commission, the Department of Labor, or the California Department of Fair Employment and Housing, except that I acknowledge and agree that I shall not recover any monetary benefits in connection with any such claim, charge or proceeding with regard to any claim released herein. Nothing in this Release shall prevent me from challenging the validity of this Release in a legal or administrative proceeding.

I acknowledge that I am knowingly and voluntarily waiving and releasing any rights I may have under the ADEA (“ADEA Waiver”), and that the consideration given under the Plan for the ADEA Waiver is in addition to anything of value to which I was already entitled. I further acknowledge that I have been advised by this writing, as

Exhibit A-11

required by the ADEA, that: (a) my ADEA Waiver and release does not apply to any rights or claims that may arise after the date I sign this Release; (b) I should consult with an attorney prior to signing this Release (although I may choose voluntarily not to do so); (c) I have twenty-one (21) days to consider this Release (although I may choose voluntarily to sign this Release earlier); (d) I have seven (7) days following the date I sign this Release to revoke the Release by providing written notice to an officer of the Company within the seven (7) day period; and (e) the ADEA Waiver shall not be effective until the date upon which the revocation period has expired unexercised, which shall be the eighth day after I sign this Release. Nevertheless, my general release of claims, except for the ADEA Waiver, is effective immediately, and not revocable.

I UNDERSTAND THAT THIS RELEASE INCLUDES A RELEASE OF ALL KNOWN AND UNKNOWN CLAIMS. In giving the release herein, which includes claims which may be unknown to me at present,I acknowledge that I have read and understand Section 1542 of the California Civil Code which reads as follows:  “A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his settlement with the debtor.”  I hereby expressly waive and relinquish all rights and benefits under that section and any law of any other jurisdiction of similar effect with respect to my release of any unknown or unsuspected claims hereunder.

I acknowledge that to become effective, I must sign and return this Release to the Company so that it is received not later than twenty-one (21) days following the date it is provided to me.

I agree not to disparage Company (or its officers, directors or employees), in any manner likely to be harmful to it, them or their business, business reputation or personal reputation; provided that I may respond accurately and fully to any question, inquiry or request for information when required by legal process. I understand and agree that in the event that I do not comply with this non-disparagement obligation, my Severance Benefits will be forfeited and subject to return upon demand by Company.

EMPLOYEE

Name:

Date:

Exhibit A-12

For Employees Age 40 or Older

Group Termination

EXHIBIT B

RELEASE AGREEMENT

I understand and agree completely to the terms set forth in the Omnicell, Inc. Severance Benefit Plan (the “Plan”).

I understand that this Release, together with the Plan, constitutes the complete, final and exclusive embodiment of the entire agreement between the Company, affiliates of the Company and me with regard to the subject matter hereof. I am not relying on any promise or representation by the Company or the Employer that is not expressly stated therein. Certain capitalized terms used in this Release are defined in the Plan.

I hereby confirm my obligations under my Proprietary Information and Inventions Agreement with the Company and/or the Employer.

In exchange for the Severance Benefits and other consideration provided to me by the Plan that I am not otherwise entitled to receive, and except as otherwise set forth in this Release, I hereby generally and completely release the Company, the Employers and their current and former parents, subsidiaries, successors, predecessors and affiliates, and their current and former partners, members, directors, officers, employees, stockholders, shareholders, agents, attorneys, predecessors, insurers, affiliates and assigns, from any and all claims, liabilities and obligations, both known and unknown, that arise out of or are in any way related to events, acts, conduct, or omissions occurring at any time prior to and including the date I sign this Release. This general release includes, but is not limited to: (a) all claims arising out of or in any way related to my employment with the Company, the Employers or their affiliates, or the termination of that employment; (b) all claims related to my compensation or benefits, including salary, bonuses, commissions, vacation pay, expense reimbursements, severance pay, fringe benefits, stock, stock options, or any other ownership interests in the Company, the Employers, or their affiliates; (c) all claims for breach of contract, wrongful termination, and breach of the implied covenant of good faith and fair dealing; (d) all tort claims, including claims for fraud, defamation, emotional distress, and discharge in violation of public policy; and (e) all federal, state, and local statutory claims, including claims for discrimination, harassment, retaliation, attorneys’ fees, or other claims arising under the federal Civil Rights Act of 1964 (as amended), the federal Americans with Disabilities Act of 1990 (as amended), the federal Age Discrimination in Employment Act (as amended) (“ADEA”), the federal Employee Retirement Income Security Act of 1974 (as amended), and the California Fair Employment and Housing Act (as amended).

I am not releasing any claim that cannot be waived under applicable state or federal law or any rights I have to pursue a claim for workers’ compensation or unemployment benefits, and I am not releasing any rights that I have to be indemnified (including any right to reimbursement of expenses) arising under applicable law, the certificate of incorporation or by-laws (or similar constituent documents of the Company), any indemnification agreement between me and the Company, the Employers, or their affiliates, or any directors’ and officers’ liability insurance policy of the Company, the Employers, or their affiliates. The foregoing notwithstanding, nothing in this Release shall prevent me from filing, cooperating with, or participating in any proceeding before the Equal Employment Opportunity Commission, the Department of Labor, or the California Department of Fair Employment and Housing, except that I acknowledge and agree that I shall not recover any monetary benefits in connection with any such claim, charge or proceeding with regard to any claim released herein. Nothing in this Release shall prevent me from challenging the validity of this Release in a legal or administrative proceeding.

I acknowledge that I am knowingly and voluntarily waiving and releasing any rights I may have under the ADEA (“ADEA Waiver”), and that the consideration given under the Plan for the ADEA Waiver is in addition to anything of value to which I was already entitled. I further acknowledge that I have been advised by this writing, as required by the ADEA, that: (a) my ADEA Waiver does not apply to any rights or claims that may arise after the date I sign this Release; (b) I should consult with an attorney prior to signing this Release (although I may choose

Exhibit B-12

voluntarily not to do so); (c) I have forty-five (45) days to consider this Release (although I may choose voluntarily to sign this Release earlier); (d) I have seven (7) days following the date I sign this Release to revoke the Release by providing written notice to an officer of the Company within the seven (7) day period; (e) the ADEA Waiver shall not be effective until the date upon which the revocation period has expired unexercised, which shall be the eighth day after I sign this Release; and (f) I have received with this Release a detailed list of the job titles and ages of all employees who were terminated in this group termination and the ages of all employees of the Company in the same job classification or organizational unit who were not terminated. Nevertheless, my general release of claims, except for the ADEA Waiver, is effective immediately, and not revocable.

I UNDERSTAND THAT THIS RELEASE INCLUDES A RELEASE OF ALL KNOWN AND UNKNOWN CLAIMS. In giving the release herein, which includes claims which may be unknown to me at present,I acknowledge that I have read and understand Section 1542 of the California Civil Code which reads as follows:  “A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his settlement with the debtor.” I hereby expressly waive and relinquish all rights and benefits under that section and any law of any other jurisdiction of similar effect with respect to my release of any unknown or unsuspected claims hereunder.

I hereby represent that I have been paid all compensation owed and for all hours worked, have received all the leave and leave benefits and protections for which I am eligible, pursuant to the Family and Medical Leave Act or otherwise, and have not suffered any on-the-job injury for which I have not already filed a claim.

I agree not to disparage Company (or its officers, directors or employees), in any manner likely to be harmful to it, them or their business, business reputation or personal reputation; provided that I may respond accurately and fully to any question, inquiry or request for information when required by legal process. I understand and agree that in the event that I do not comply with this non-disparagement obligation, my Severance Benefits will be forfeited and subject to return upon demand by Company.

I acknowledge that to become effective, I must sign and return this Release to the Company so that it is received not later than forty-five (45) days following the date it is provided to me.

EMPLOYEE

Name:

Date:

Exhibit B-13

For Employees Under Age 40

Individual and Group Termination

EXHIBIT C

RELEASE AGREEMENT

I understand and agree completely to the terms set forth in the Omnicell, Inc. Severance Benefit Plan (the “Plan”).

I understand that this Release, together with the Plan, constitutes the complete, final and exclusive embodiment of the entire agreement between the Company, affiliates of the Company and me with regard to the subject matter hereof. I am not relying on any promise or representation by the Company or the Employer that is not expressly stated therein. Certain capitalized terms used in this Release are defined in the Plan.

I hereby confirm my obligations under my Proprietary Information and Inventions Agreement with the Company and/or the Employer.

In exchange for the Severance Benefits and other consideration provided to me by the Plan that I am not otherwise entitled to receive, and except as otherwise set forth in this Release, I hereby generally and completely release the Company, the Employers and their current and former parents, subsidiaries, successors, predecessors and affiliates, and their current and former partners, members, directors, officers, employees, stockholders, shareholders, agents, attorneys, predecessors, insurers, affiliates and assigns, from any and all claims, liabilities and obligations, both known and unknown, that arise out of or are in any way related to events, acts, conduct, or omissions occurring at any time prior to and including the date I sign this Release. This general release includes, but is not limited to: (a) all claims arising out of or in any way related to my employment with the Company, the Employers or their affiliates, or the termination of that employment; (b) all claims related to my compensation or benefits, including salary, bonuses, commissions, vacation pay, expense reimbursements, severance pay, fringe benefits, stock, stock options, or any other ownership interests in the Company, the Employers, or their affiliates; (c) all claims for breach of contract, wrongful termination, and breach of the implied covenant of good faith and fair dealing; (d) all tort claims, including claims for fraud, defamation, emotional distress, and discharge in violation of public policy; and (e) all federal, state, and local statutory claims, including claims for discrimination, harassment, retaliation, attorneys’ fees, or other claims arising under the federal Civil Rights Act of 1964 (as amended), the federal Americans with Disabilities Act of 1990 (as amended), the federal Employee Retirement Income Security Act of 1974 (as amended), and the California Fair Employment and Housing Act (as amended).

I am not releasing any claim that cannot be waived under applicable state or federal law or any rights I have to pursue a claim for workers’ compensation or unemployment benefits, and I am not releasing any rights that I have to be indemnified (including any right to reimbursement of expenses) arising under applicable law, the certificate of incorporation or by-laws (or similar constituent documents of the Company), any indemnification agreement between me and the Company, the Employers, or their affiliates, or any directors’ and officers’ liability insurance policy of the Company, the Employers, or their affiliates. The foregoing notwithstanding, nothing in this Release shall prevent me from filing, cooperating with, or participating in any proceeding before the Equal Employment Opportunity Commission, the Department of Labor, or the California Department of Fair Employment and Housing, except that I acknowledge and agree that I shall not recover any monetary benefits in connection with any such claim, charge or proceeding with regard to any claim released herein. Nothing in this Release shall prevent me from challenging the validity of this Release in a legal or administrative proceeding.

I UNDERSTAND THAT THIS RELEASE INCLUDES A RELEASE OF ALL KNOWN AND UNKNOWN CLAIMS. In giving the release herein, which includes claims which may be unknown to me at present,I acknowledge that I have read and understand Section 1542 of the California Civil Code which reads as follows: “A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his settlement with the debtor.” I hereby expressly waive and relinquish all rights and benefits under that section and

Exhibit C-14

any law of any other jurisdiction of similar effect with respect to my release of any unknown or unsuspected claims hereunder.

I hereby represent that I have been paid all compensation owed and for all hours worked, have received all the leave and leave benefits and protections for which I am eligible, pursuant to the Family and Medical Leave Act or otherwise, and have not suffered any on-the-job injury for which I have not already filed a claim.

I agree not to disparage Company (or its officers, directors or employees), in any manner likely to be harmful to it, them or their business, business reputation or personal reputation; provided that I may respond accurately and fully to any question, inquiry or request for information when required by legal process. I understand and agree that in the event that I do not comply with this non-disparagement obligation, my Severance Benefits will be forfeited and subject to return upon demand by Company.

I acknowledge that to become effective, I must sign and return this Release to the Company so that it is received not later than fourteen (14) days following the date it is provided to me.

EMPLOYEE

Name:

Date:

Exhibit C-15

APPENDIX A

OMNICELL, INC.

SEVERANCE BENEFIT PLAN

Affiliates of the Company whose employees are eligible to participate in the Omnicell, Inc. Severance Benefit Plan (each an “Employer”) are as follows:

None

The foregoing list of Employers is subject to such change as the Company, pursuant to Section 1 of the Plan, may determine in its sole and absolute discretion. Any such change to the participating Employers shall be set forth in a revised version of this Appendix A.

Appendix A Adopted: June 20, 2009

OMNICELL, INC.

By:

Title:

Appendix A-16

APPENDIX B

OMNICELL, INC.

SEVERANCE BENEFIT PLAN

Severance benefits provided to Eligible Employees under the Omnicell, Inc. Severance Benefit Plan (the “Plan”) are as follows, and apply to Eligible Employees up to and including the level of Senior Manager (including Systems Sales Directors, Senior Systems Sales Directors and Directors of Corporate Sales):

1.Severance Benefits.  Subject to the exceptions set forth in Section 2(b) of the Plan, each Eligible Employee who meets all the requirements set forth in Sections 2(a) and 4(a) of the Plan, including, without limitation, executing a general waiver and release in substantially the form attached to the Plan as Exhibit A, Exhibit B or Exhibit C, as appropriate, within the applicable time period set forth therein, but in no event more than sixty (60) days following the date of termination, and provided that such release becomes effective in accordance with its terms, shall receive severance benefits as set forth in this Appendix B. The Company, in its sole discretion, may modify the form of the required general waiver and release to comply with applicable law, and may incorporate such waiver and release into a termination agreement or other agreement with the Eligible Employee.

(a)Cash Severance Benefit.  Eligible Employees shall be entitled to receive a cash severance benefit equal to the number of months of Base Salary set forth below next to his or her Years of Service at the time of termination. Partial Years of Service are not counted.

Years of Service	Months of Base Salary
1	1 month
2	2 months
3	3 months
For each 5 Years of Service	1 extra month

(b)Continued Group Health Plan Benefits.  If the Eligible Employee was enrolled in a group health plan (e.g., medical, dental, or vision plan) sponsored by the Company or an affiliate of the Company immediately prior to termination, the Eligible Employee may be eligible to continue coverage under such group health plan (or to convert to an individual policy), at the time of the Eligible Employee’s termination of employment, under the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”). The Company will notify the Eligible Employee of any such right to continue such coverage at the time of termination pursuant to COBRA. No provision of this Plan will affect the continuation coverage rules under COBRA, except that the Company’s payment, if any, of applicable insurance premiums, or waiver of any cost of coverage under any self-funded group health plan, will be credited as payment by the Eligible Employee for purposes of the Eligible Employee’s payment required under COBRA.

Therefore, the period during which an Eligible Employee may elect to continue the Company’s or its affiliate’s group health plan coverage at his or her own expense under COBRA, the length of time during which COBRA coverage will be made available to the Eligible Employee, and all other rights and obligations of the Eligible Employee under COBRA (except the obligation to pay insurance premiums that the Company pays, if any, or, with respect to a self-funded plan, any obligation to pay the cost of coverage to the Company that the Company waives, if any) will be applied in the same manner that such rules would apply in the absence of this Plan.

If an Eligible Employee timely elects continued coverage under COBRA, the Company shall pay

Appendix B-17

the same portion of (or, in the case of any self-funded plan, shall credit the Eligible Employee with the same portion of) the Eligible Employee’s premiums for COBRA continuation coverage (including coverage for the Eligible Employee’s eligible dependents) that the Company paid (or bore in the case of any self-funded plan) for the Eligible Employee’s active employee coverage under the Company’s group health plans for the number of months following the Eligible Employee’s termination of employment that is equal to the number of months of the cash severance benefit described above.  Notwithstanding the foregoing, no such premium payments shall be made or credited following the Eligible Employee’s death or the effective date of the Eligible Employee’s coverage under a group health plan of another employer. 

The Eligible employee may also be entitled to receive a subsidy toward the remaining portion of the Eligible Employee’s COBRA premiums for a period of time (not to exceed nine (9) months) to the extent the Eligible Employee (and each covered dependent, if applicable) qualifies under the American Recovery and Reinvestment Act of 2009 (“ARRA”) as an “assistance eligible individual” who is entitled to a COBRA premium subsidy without recapture.The Eligible Employee shall be responsible for remitting the full amount of the COBRA premiums necessary to maintain continued coverage under the Company’s group health plans. Upon receipt by the Company of written documentation that the Eligible Employee paid the full COBRA premium for the applicable month, the Company shall pay to the Eligible Employee the Company’s portion of the COBRA premium payment for that month and, if applicable, the COBRA premium subsidy available to the Eligible Employee under ARRA as long as the Eligible Employee remains eligible for such subsidy.  Each Eligible Employee shall be required to notify the Company immediately if the Eligible Employee becomes eligible for or covered by a group health plan of another employer. Upon the conclusion of such period of insurance premium payments made by the Company, or the provision of coverage under a self-funded group health plan, the Eligible Employee will be responsible for the entire payment of premiums (or payment for the cost of coverage) required under COBRA for the duration of the COBRA period except to the extent the Eligible Employee remains eligible for the COBRA premium subsidy under ARRA.

For purposes of this Section 1(b), (i) references to COBRA shall be deemed to refer also to analogous provisions of state law, as applicable, and (ii) any applicable insurance premiums that are paid by the Company shall not include any amounts payable by the Eligible Employee under an Internal Revenue Code Section 125 health care reimbursement plan, which amounts, if any, are the sole responsibility of the Eligible Employee.

(c)Outplacement Assistance.  Eligible Employees shall be entitled to outplacement assistance, the scope of which shall be determined by the Company in the Company’s sole discretion. Eligible Employees shall not be entitled to any payment in lieu of outplacement assistance.

2.Definitions:  The following definitions shall apply for purposes of this Appendix B:

(a)“Base Salary” shall mean the Eligible Employee’s base pay (excluding incentive pay, premium pay, commissions, overtime, bonuses and other forms of variable compensation), at the rate in effect during the last regularly scheduled payroll period immediately preceding the Eligible Employee’s termination date. For any Eligible Employees that are regular part-time employees, “Base Salary” shall mean the pro-rata equivalent of the Eligible Employee’s base pay which reflects the part-time status of the Eligible Employee.

(b)“Years of Service” means a continuous complete twelve-month period commencing on an Eligible Employee’s date of hire with the Company or an Employer and anniversaries thereof, during which the Eligible Employee is employed by the Company or an Employer, and ending on the date on which the Eligible Employee is notified, in writing, pursuant to Section 2(a)(1) of the Plan that he or she is eligible for participation in the Plan. For purposes of the foregoing, an Eligible Employee will receive credit for any time on a paid leave of absence, but not for time on

Appendix B-18

an unpaid leave of absence.

3.Other Employee Benefits.  All other benefits (such as life insurance, disability coverage, and 401(k) plan coverage) terminate as of the Eligible Employee’s termination date (except to the extent that a conversion privilege may be available thereunder).

4.Reductions Pursuant to Section 3(c) of the Plan.  The severance benefits set forth in this Appendix B are subject to certain reductions under Section 3(c) of the Plan.

The foregoing severance benefits are subject to such change as the Company, pursuant to Section 3(a) of the Plan, may determine in its sole and absolute discretion. Any such change in severance benefits shall be set forth in a revised version of this Appendix B.

Appendix B Adopted: June 20, 2009

OMNICELL, INC.

By:

Title:

Appendix B-19

APPENDIX B

OMNICELL, INC.

SEVERANCE BENEFIT PLAN

Severance benefits provided to Eligible Employees under the Omnicell, Inc. Severance Benefit Plan (the “Plan”) are as follows, and apply to Eligible Employees at the levels of Director and Senior Director (excluding Systems Sales Directors, Senior Systems Sales Directors and Directors of Corporate Sales):

1.Severance Benefits.  Subject to the exceptions set forth in Section 2(b) of the Plan, each Eligible Employee who meets all the requirements set forth in Sections 2(a) and 4(a) of the Plan, including, without limitation, executing a general waiver and release in substantially the form attached to the Plan as Exhibit A, Exhibit B or Exhibit C, as appropriate, within the applicable time period set forth therein, but in no event more than sixty (60) days following the date of termination, and provided that such release becomes effective in accordance with its terms, shall receive severance benefits as set forth in this Appendix B. The Company, in its sole discretion, may modify the form of the required general waiver and release to comply with applicable law, and may incorporate such waiver and release into a termination agreement or other agreement with the Eligible Employee.

(a)Cash Severance Benefit.  Eligible Employees shall be entitled to receive a cash severance benefit equal to the number of months of Base Salary set forth below next to his or her Years of Service at the time of termination. Partial Years of Service are not counted.

Years of Service	Months of Base Salary
Not relevant	4 months
For each 5 Years of Service	1 extra month

(b)Continued Group Health Plan Benefits.  If the Eligible Employee was enrolled in a group health plan (e.g., medical, dental, or vision plan) sponsored by the Company or an affiliate of the Company immediately prior to termination, the Eligible Employee may be eligible to continue coverage under such group health plan (or to convert to an individual policy), at the time of the Eligible Employee’s termination of employment, under the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”). The Company will notify the Eligible Employee of any such right to continue such coverage at the time of termination pursuant to COBRA. No provision of this Plan will affect the continuation coverage rules under COBRA, except that the Company’s payment, if any, of applicable insurance premiums, or waiver of any cost of coverage under any self-funded group health plan, will be credited as payment by the Eligible Employee for purposes of the Eligible Employee’s payment required under COBRA.

Therefore, the period during which an Eligible Employee may elect to continue the Company’s or its affiliate’s group health plan coverage at his or her own expense under COBRA, the length of time during which COBRA coverage will be made available to the Eligible Employee, and all other rights and obligations of the Eligible Employee under COBRA (except the obligation to pay insurance premiums that the Company pays, if any, or, with respect to a self-funded plan, any obligation to pay the cost of coverage to the Company that the Company waives, if any) will be applied in the same manner that such rules would apply in the absence of this Plan.

If an Eligible Employee timely elects continued coverage under COBRA, the Company shall pay the same portion of (or, in the case of any self-funded plan, shall credit the Eligible Employee with the same portion of) the Eligible Employee’s premiums for COBRA continuation coverage (including coverage for the Eligible Employee’s eligible dependents) that the Company paid (or

Appendix B-20

bore in the case of any self-funded plan) for the Eligible Employee’s active employee coverage under the Company’s group health plans for the number of months following the Eligible Employee’s termination of employment that is equal to the number of months of the cash severance benefit described above.  Notwithstanding the foregoing, no such premium payments shall be made or credited following the Eligible Employee’s death or the effective date of the Eligible Employee’s coverage under a group health plan of another employer. 

The Eligible employee may also be entitled to receive a subsidy toward the remaining portion of the Eligible Employee’s COBRA premiums for a period of time (not to exceed nine (9) months) to the extent the Eligible Employee (and each covered dependent, if applicable) qualifies under the American Recovery and Reinvestment Act of 2009 (“ARRA”) as an “assistance eligible individual” who is entitled to a COBRA premium subsidy without recapture.The Eligible Employee shall be responsible for remitting the full amount of the COBRA premiums necessary to maintain continued coverage under the Company’s group health plans.  Upon receipt by the Company of written documentation that the Eligible Employee paid the full COBRA premium for the applicable month, the Company shall pay to the Eligible Employee the Company’s portion of the COBRA premium payment for that month and, if applicable, the COBRA premium subsidy available to the Eligible Employee under ARRA as long as the Eligible Employee remains eligible for such subsidy.  Each Eligible Employee shall be required to notify the Company immediately if the Eligible Employee becomes eligible for or covered by a group health plan of another employer. Upon the conclusion of such period of insurance premium payments made by the Company, or the provision of coverage under a self-funded group health plan, the Eligible Employee will be responsible for the entire payment of premiums (or payment for the cost of coverage) required under COBRA for the duration of the COBRA periodexcept to the extent the Eligible Employee remains eligible for the COBRA premium subsidy under ARRA.

For purposes of this Section 1(b), (i) references to COBRA shall be deemed to refer also to analogous provisions of state law, as applicable, and (ii) any applicable insurance premiums that are paid by the Company shall not include any amounts payable by the Eligible Employee under an Internal Revenue Code Section 125 health care reimbursement plan, which amounts, if any, are the sole responsibility of the Eligible Employee.

(c)Outplacement Assistance.  Eligible Employees shall be entitled to outplacement assistance, the scope of which shall be determined by the Company in the Company’s sole discretion. Eligible Employees shall not be entitled to any payment in lieu of outplacement assistance.

2.Definitions:  The following definitions shall apply for purposes of this Appendix B:

(a)“Base Salary” shall mean the Eligible Employee’s base pay (excluding incentive pay, premium pay, commissions, overtime, bonuses and other forms of variable compensation), at the rate in effect during the last regularly scheduled payroll period immediately preceding the Eligible Employee’s termination date. For any Eligible Employees that are regular part-time employees, “Base Salary” shall mean the pro-rata equivalent of the Eligible Employee’s base pay which reflects the part-time status of the Eligible Employee.

(b)“Years of Service” means a continuous complete twelve-month period commencing on an Eligible Employee’s date of hire with the Company or an Employer and anniversaries thereof, during which the Eligible Employee is employed by the Company or an Employer, and ending on the date on which the Eligible Employee is notified, in writing, pursuant to Section 2(a)(1) of the Plan that he or she is eligible for participation in the Plan. For purposes of the foregoing, an Eligible Employee will receive credit for any time on a paid leave of absence, but not for time on an unpaid leave of absence.

Appendix B-21

3.Other Employee Benefits. All other benefits (such as life insurance, disability coverage, and 401(k) plan coverage) terminate as of the Eligible Employee’s termination date (except to the extent that a conversion privilege may be available thereunder).

4.Reductions Pursuant to Section 3(c) of the Plan.  The severance benefits set forth in this Appendix B are subject to certain reductions under Section 3(c) of the Plan.

The foregoing severance benefits are subject to such change as the Company, pursuant to Section 3(a) of the Plan, may determine in its sole and absolute discretion. Any such change in severance benefits shall be set forth in a revised version of this Appendix B.

Appendix B Adopted: June 20, 2009

OMNICELL, INC.

By:

Title:

Appendix B-22

APPENDIX B

OMNICELL, INC.

SEVERANCE BENEFIT PLAN

Severance benefits provided to Eligible Employees under the Omnicell, Inc. Severance Benefit Plan (the “Plan”) are as follows, and apply to Eligible Employees at the level of Vice President, where such Vice President is not reported by the Company as an officer under Section 16(b) of the Securities and Exchange Act of 1934:

1.Severance Benefits.  Subject to the exceptions set forth in Section 2(b) of the Plan, each Eligible Employee who meets all the requirements set forth in Sections 2(a) and 4(a) of the Plan, including, without limitation, executing a general waiver and release in substantially the form attached to the Plan as Exhibit A, Exhibit B or Exhibit C, as appropriate, within the applicable time period set forth therein, but in no event more than sixty (60) days following the date of termination, and provided that such release becomes effective in accordance with its terms, shall receive severance benefits as set forth in this Appendix B. The Company, in its sole discretion, may modify the form of the required general waiver and release to comply with applicable law, and may incorporate such waiver and release into a termination agreement or other agreement with the Eligible Employee.

(a)Cash Severance Benefit.  Eligible Employees shall be entitled to receive a cash severance benefit equal to the number of months of Base Salary set forth below next to his or her Years of Service at the time of termination. Partial Years of Service are not counted.

Years of Service	Months of Base Salary
Not relevant	6 months
For each 5 Years of Service	2 extra months

(b)Continued Group Health Plan Benefits.  If the Eligible Employee was enrolled in a group health plan (e.g., medical, dental, or vision plan) sponsored by the Company or an affiliate of the Company immediately prior to termination, the Eligible Employee may be eligible to continue coverage under such group health plan (or to convert to an individual policy), at the time of the Eligible Employee’s termination of employment, under the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”). The Company will notify the Eligible Employee of any such right to continue such coverage at the time of termination pursuant to COBRA. No provision of this Plan will affect the continuation coverage rules under COBRA, except that the Company’s payment, if any, of applicable insurance premiums, or waiver of any cost of coverage under any self-funded group health plan, will be credited as payment by the Eligible Employee for purposes of the Eligible Employee’s payment required under COBRA.

Therefore, the period during which an Eligible Employee may elect to continue the Company’s or its affiliate’s group health plan coverage at his or her own expense under COBRA, the length of time during which COBRA coverage will be made available to the Eligible Employee, and all other rights and obligations of the Eligible Employee under COBRA (except the obligation to pay insurance premiums that the Company pays, if any, or, with respect to a self-funded plan, any obligation to pay the cost of coverage to the Company that the Company waives, if any) will be applied in the same manner that such rules would apply in the absence of this Plan.

If an Eligible Employee timely elects continued coverage under COBRA, the Company shall pay the same portion of (or, in the case of any self-funded plan, shall credit the Eligible Employee with the same portion of) the Eligible Employee’s premiums for COBRA continuation coverage

Appendix B-23

(including coverage for the Eligible Employee’s eligible dependents) that the Company paid (or bore in the case of any self-funded plan) for the Eligible Employee’s active employee coverage under the Company’s group health plans for the number of months following the Eligible Employee’s termination of employment that is equal to the number of months of the cash severance benefit described above.  Notwithstanding the foregoing, no such premium payments shall be made or credited following the Eligible Employee’s death or the effective date of the Eligible Employee’s coverage under a group health plan of another employer. 

The Eligible employee may also be entitled to receive a subsidy toward the remaining portion of the Eligible Employee’s COBRA premiums for a period of time (not to exceed nine (9) months) to the extent the Eligible Employee (and each covered dependent, if applicable) qualifies under the American Recovery and Reinvestment Act of 2009 (“ARRA”) as an “assistance eligible individual” who is entitled to a COBRA premium subsidy without recapture.The Eligible Employee shall be responsible for remitting the full amount of the COBRA premiums necessary to maintain continued coverage under the Company’s group health plans.  Upon receipt by the Company of written documentation that the Eligible Employee paid the full COBRA premium for the applicable month, the Company shall pay to the Eligible Employee the Company’s portion of the COBRA premium payment for that monthand, if applicable, the COBRA premium subsidy available to the Eligible Employee under ARRA as long as the Eligible Employee remains eligible for such subsidy.  Each Eligible Employee shall be required to notify the Company immediately if the Eligible Employee becomes eligible for or covered by a group health plan of another employer. Upon the conclusion of such period of insurance premium payments made by the Company, or the provision of coverage under a self-funded group health plan, the Eligible Employee will be responsible for the entire payment of premiums (or payment for the cost of coverage) required under COBRA for the duration of the COBRA periodexcept to the extent the Eligible Employee remains eligible for the COBRA premium subsidy under ARRA.

For purposes of this Section 1(b), (i) references to COBRA shall be deemed to refer also to analogous provisions of state law, as applicable, and (ii) any applicable insurance premiums that are paid by the Company shall not include any amounts payable by the Eligible Employee under an Internal Revenue Code Section 125 health care reimbursement plan, which amounts, if any, are the sole responsibility of the Eligible Employee.

(c)Outplacement Assistance.  Eligible Employees shall be entitled to outplacement assistance, the scope of which shall be determined by the Company in the Company’s sole discretion. Eligible Employees shall not be entitled to any payment in lieu of outplacement assistance.

2.Definitions: The following definitions shall apply for purposes of this Appendix B:

(a)“Base Salary” shall mean the Eligible Employee’s base pay (excluding incentive pay, premium pay, commissions, overtime, bonuses and other forms of variable compensation), at the rate in effect during the last regularly scheduled payroll period immediately preceding the Eligible Employee’s termination date. For any Eligible Employees that are regular part-time employees, “Base Salary” shall mean the pro-rata equivalent of the Eligible Employee’s base pay which reflects the part-time status of the Eligible Employee.

(b)“Years of Service” means a continuous complete twelve-month period commencing on an Eligible Employee’s date of hire with the Company or an Employer and anniversaries thereof, during which the Eligible Employee is employed by the Company or an Employer, and ending on the date on which the Eligible Employee is notified, in writing, pursuant to Section 2(a)(1) of the Plan that he or she is eligible for participation in the Plan. For purposes of the foregoing, an Eligible Employee will receive credit for any time on a paid leave of absence, but not for time on an unpaid leave of absence.

Appendix B-24

3.Other Employee Benefits.  All other benefits (such as life insurance, disability coverage, and 401(k) plan coverage) terminate as of the Eligible Employee’s termination date (except to the extent that a conversion privilege may be available thereunder).

4.Reductions Pursuant to Section 3(c) of the Plan.  The severance benefits set forth in this Appendix B are subject to certain reductions under Section 3(c) of the Plan.

The foregoing severance benefits are subject to such change as the Company, pursuant to Section 3(a) of the Plan, may determine in its sole and absolute discretion. Any such change in severance benefits shall be set forth in a revised version of this Appendix B.

Appendix B Adopted: June 20, 2009

OMNICELL, INC.

By:

Title:

Appendix B-25

APPENDIX B

OMNICELL, INC.

SEVERANCE BENEFIT PLAN

Severance benefits provided to Eligible Employees under the Omnicell, Inc. Severance Benefit Plan (the “Plan”) are as follows, and apply to Eligible Employees at the level of Vice President, where such Vice President is reported by the Company as an officer under Section 16(b) of the Securities and Exchange Act of 1934, and the President:

1.Severance Benefits.  Subject to the exceptions set forth in Section 2(b) of the Plan, each Eligible Employee who meets all the requirements set forth in Sections 2(a) and 4(a) of the Plan, including, without limitation, executing a general waiver and release in substantially the form attached to the Plan as Exhibit A, Exhibit B or Exhibit C, as appropriate, within the applicable time period set forth therein, but in no event more than sixty (60) days following the date of termination, and provided that such release becomes effective in accordance with its terms, shall receive severance benefits as set forth in this Appendix B. The Company, in its sole discretion, may modify the form of the required general waiver and release to comply with applicable law, and may incorporate such waiver and release into a termination agreement or other agreement with the Eligible Employee.

(a)Cash Severance Benefit.  Eligible Employees shall be entitled to receive a cash severance benefit equal to the number of months of Base Salary set forth below next to his or her Years of Service at the time of termination. Partial Years of Service are not counted.

Years of Service	Months of Base Salary
Not relevant	12 months
For each 5 Years of Service	2 extra months

(b)Continued Group Health Plan Benefits.  If the Eligible Employee was enrolled in a group health plan (e.g., medical, dental, or vision plan) sponsored by the Company or an affiliate of the Company immediately prior to termination, the Eligible Employee may be eligible to continue coverage under such group health plan (or to convert to an individual policy), at the time of the Eligible Employee’s termination of employment, under the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”). The Company will notify the Eligible Employee of any such right to continue such coverage at the time of termination pursuant to COBRA. No provision of this Plan will affect the continuation coverage rules under COBRA, except that the Company’s payment, if any, of applicable insurance premiums, or waiver of any cost of coverage under any self-funded group health plan, will be credited as payment by the Eligible Employee for purposes of the Eligible Employee’s payment required under COBRA.

Therefore, the period during which an Eligible Employee may elect to continue the Company’s or its affiliate’s group health plan coverage at his or her own expense under COBRA, the length of time during which COBRA coverage will be made available to the Eligible Employee, and all other rights and obligations of the Eligible Employee under COBRA (except the obligation to pay insurance premiums that the Company pays, if any, or, with respect to a self-funded plan, any obligation to pay the cost of coverage to the Company that the Company waives, if any) will be applied in the same manner that such rules would apply in the absence of this Plan.

If an Eligible Employee timely elects continued coverage under COBRA, the Company shall pay the same portion of (or, in the case of any self-funded plan, shall credit the Eligible Employee with the same portion of) the Eligible Employee’s premiums for COBRA continuation coverage

Appendix B-26

(including coverage for the Eligible Employee’s eligible dependents) that the Company paid (or bore in the case of any self-funded plan) for the Eligible Employee’s active employee coverage under the Company’s group health plans for the number of months following the Eligible Employee’s termination of employment that is equal to the number of months of the cash severance benefit described above.  Notwithstanding the foregoing, no such premium payments shall be made or credited following the Eligible Employee’s death or the effective date of the Eligible Employee’s coverage under a group health plan of another employer. 

The Eligible employee may also be entitled to receive a subsidy toward the remaining portion of the Eligible Employee’s COBRA premiums for a period of time (not to exceed nine (9) months) to the extent the Eligible Employee (and each covered dependent, if applicable) qualifies under the American Recovery and Reinvestment Act of 2009 (“ARRA”) as an “assistance eligible individual” who is entitled to a COBRA premium subsidy without recapture.The Eligible Employee shall be responsible for remitting the full amount of the COBRA premiums necessary to maintain continued coverage under the Company’s group health plans.  Upon receipt by the Company of written documentation that the Eligible Employee paid the full COBRA premium for the applicable month, the Company shall pay to the Eligible Employee the Company’s portion of the COBRA premium payment for that monthand, if applicable, the COBRA premium subsidy available to the Eligible Employee under ARRA as long as the Eligible Employee remains eligible for such subsidy.  Each Eligible Employee shall be required to notify the Company immediately if the Eligible Employee becomes eligible for or covered by a group health plan of another employer. Upon the conclusion of such period of insurance premium payments made by the Company, or the provision of coverage under a self-funded group health plan, the Eligible Employee will be responsible for the entire payment of premiums (or payment for the cost of coverage) required under COBRA for the duration of the COBRA periodexcept to the extent the Eligible Employee remains eligible for the COBRA premium subsidy under ARRA.

For purposes of this Section 1(b), (i) references to COBRA shall be deemed to refer also to analogous provisions of state law, as applicable, and (ii) any applicable insurance premiums that are paid by the Company shall not include any amounts payable by the Eligible Employee under an Internal Revenue Code Section 125 health care reimbursement plan, which amounts, if any, are the sole responsibility of the Eligible Employee.

(c)Outplacement Assistance.  Eligible Employees shall be entitled to outplacement assistance, the scope of which shall be determined by the Company in the Company’s sole discretion. Eligible Employees shall not be entitled to any payment in lieu of outplacement assistance.

2.Definitions:  The following definitions shall apply for purposes of this Appendix B:

(a)“Base Salary” shall mean the Eligible Employee’s base pay (excluding incentive pay, premium pay, commissions, overtime, bonuses and other forms of variable compensation), at the rate in effect during the last regularly scheduled payroll period immediately preceding the Eligible Employee’s termination date. For any Eligible Employees that are regular part-time employees, “Base Salary” shall mean the pro-rata equivalent of the Eligible Employee’s base pay which reflects the part-time status of the Eligible Employee.

(b)“Years of Service” means a continuous complete twelve-month period commencing on an Eligible Employee’s date of hire with the Company or an Employer and anniversaries thereof, during which the Eligible Employee is employed by the Company or an Employer, and ending on the date on which the Eligible Employee is notified, in writing, pursuant to Section 2(a)(1) of the Plan that he or she is eligible for participation in the Plan. For purposes of the foregoing, an Eligible Employee will receive credit for any time on a paid leave of absence, but not for time on an unpaid leave of absence.

Appendix B-27

3.Other Employee Benefits.  All other benefits (such as life insurance, disability coverage, and 401(k) plan coverage) terminate as of the Eligible Employee’s termination date (except to the extent that a conversion privilege may be available thereunder).

4.Reductions Pursuant to Section 3(c) of the Plan.  The severance benefits set forth in this Appendix B are subject to certain reductions under Section 3(c) of the Plan.

The foregoing severance benefits are subject to such change as the Company, pursuant to Section 3(a) of the Plan, may determine in its sole and absolute discretion. Any such change in severance benefits shall be set forth in a revised version of this Appendix B.

Appendix B Adopted: June 20, 2009

OMNICELL, INC.

By:

Title:

Appendix B-28

EX-10.2

Exhibit 10.2

May 24, 2012

William Shields

Dear Bill,

As you know, Omnicell, Inc. (“Omnicell”) entered into an agreement and plan of merger (“Merger Agreement”) under which MTS Medication Technologies, Inc. (“MTS”) became a wholly-owned subsidiary of Omnicell upon the closing of the transaction on May 21, 2012 (the “Closing”). 

With this background in place, we are pleased to offer you the following principal terms for employment with Omnicell following the Closing. Your position will be Executive Vice President, reporting to Randall Lipps. Your monthly salary will be $21,666.66, less payroll deductions and all required withholdings, which is an annual equivalent of $260,000.00.

As a material inducement to accept Omnicell’s offer of employment, and subject to approval by our Board of Directors, at the next regularly scheduled meeting of the Board after the Closing, you will be granted an award of options to purchase up to 30,000shares of Omnicell Common Stock at a price equal to the fair market value of such shares on the date of grant (the “Option”). Upon approval, those Option shares will vest and become exercisable during your active employment with Omnicell over a four-year vesting period, with twenty-five percent (25%) of the shares under the Option vesting on the one-year anniversary of the vesting commencement date, and the remaining shares vesting pro-rata on a monthly basis over the next thirty-six (36) months. In addition, as a material inducement to accept Omnicell’s offer of employment, and also subject to approval by our Board of Directors, you will be granted restricted stock units (RSUs) covering 15,000 shares of Omnicell Common Stock, which will vest in equal increments every six months over a four-year vesting period. This equity grant, comprised of share options and RSUs, will be subject to the terms and conditions of Omnicell’s stock option plan and your grant agreements.

As a further material inducement to accept Omnicell’s offer of employment, and subject to approval by our Board of Directors at the next regularly scheduled meeting after the Closing, you will be granted an additional RSU award covering 10,000 shares, which will vest in full 18 months from the date of grant, provided you remain actively employed with Omnicell during the vesting period. This stock grant will be subject to the terms and conditions of Omnicell’s stock option plan and your grant agreement.

Subject to the terms of the MTS Medication Technologies, Inc. Management Bonus Plan specially adopted for the remainder of calendar year 2012, you will be eligible to participate in a one-time bonus compensation program with a target payout of 90% of your base salary, as earned between April 1, 2012 and December 31, 2012, upon full achievement of the agreed metrics, to be evaluated, in the sole discretion of Omnicell, based on a combination of Omnicell and MTS company performance for the current MTS fiscal year beginning April 1, 2012, through December 31, 2012 and, if earned, paid on the first regular payday after the bonus amount, if any, has been calculated. You must be an Omnicell employee through the end of the bonus period (December 31, 2012) in order to earn the bonus. No prorated bonus can be earned or will be awarded except as specified in writing as part of the bonus plan document. Any bonuses are deemed earned and awarded at the sole discretion of Omnicell and its Board of Directors. For calendar year 2012, you will not be eligible for any other bonus compensation, including without limitation the Omnicell MBO Program (from which you hereby “opt-out” for calendar year 2012), and the Omnicell, Inc. 2010 Quarterly Executive Bonus Plan.

Employment at Omnicell or any of its subsidiaries is at-will employment, which means it may be terminated by you or by Omnicell at any time, with our without cause or liability, and with or without advance notice. Your employment at-will status can only be modified in a written agreement signed by you and by an officer of Omnicell. In addition, Omnicell may change your position, duties, compensation, benefits and work location from time to time at its discretion.

As an Omnicell employee, you will be eligible for benefits under the Omnicell, Inc. Amended and Restated Severance Benefit Plan (the “Severance Plan”, a copy of which is enclosed). In addition, in the event that your employment is terminated without Cause (as defined in the Severance Plan) and as a result of the transactions contemplated in the Merger Agreement and within six (6) months after the Closing, provided that you execute and allow to become fully effective a general release and waiver of all claims in the form attached hereto as Exhibit B, you will receive the following:

1. A lump sum amount equal to your annual base salary, in addition to any Unpaid Bonus Payment and any Unpaid Current Period Bonus Payment (each as defined in the MTS Employment Agreement), all subject to payroll withholding and deduction, and payable on the sixtieth (60^th) day following the date of employment termination;

2. For up to twelve (12) months beginning on the termination date (the “COBRA Premiums Period”), the Company will pay an amount toward your COBRA premiums, equivalent to the Company’s share of the health care coverage premiums paid by the Company on your behalf while you were a participant in the group health insurance coverage in effect as of the termination date (the “COBRA Premiums Amount”), provided you timely elect continued coverage under COBRA. You will remain responsible for an amount equal to your share of health care coverage premiums, and the COBRA administrative fee. If Omnicell determines, in its sole discretion, that it cannot pay the COBRA Premiums Amount without a substantial risk of violating applicable law (including, without limitation, Section 2716 of the Public Health Service Act), the Company instead shall pay to you, on the first day of each month, a cash payment equal to the applicable COBRA Premiums Amount for that month, subject to applicable tax withholdings (such amount, the “Special Cash Payment”), during the COBRA Premiums Period. You may, but are not obligated to, use such Special Cash Payment toward the cost of COBRA premiums. If, during the COBRA Premiums Period, you become covered by group health insurance coverage through another employer or otherwise you cease to be eligible for COBRA, you must immediately notify Omnicell in writing of such event.

Payment of any severance under the above provision is subject to set-off against, and reduction of any benefits for which you may be eligible under the Severance Plan.

Your new terms of employment will take effect immediately upon the Closing.

For calendar year 2012 you will remain eligible to participate in, and you will remain enrolled in your current elected benefit plans, and transition to Omnicell plans thereafter. Omnicell may, however, change benefits from time to time at its discretion. Omnicell also maintains competitive medical, dental and vision plans as well as term life, long and short term disability insurance policies, and 401(k) plan. In addition, you will be given service credit for your service with MTS from your original date of hire by MTS, for purposes of all Omnicell compensation programs, the vacation policy, severance plans, and medical, dental and vision plans.

As a condition of employment and required by law, you must show proof of your identity and authorization to work in the United States. To complete the federally-required verification form (I-9), we ask that you submit copies of this documentation with your new employment materials during your first week of employment after the Closing. You will be provided with a list of permissible documents with the Form I-9.

As an employee of Omnicell or a subsidiary of Omnicell, you will be expected to abide by Company policies and procedures, the Company’s Policy Against Trading on the Basis of Inside Information and the Code of Ethics, and acknowledge in writing that you have read and understand the Company’s Employee Handbook. Initially, you will also be expected to abide by the MTS employee handbook. As a condition of employment, you must read, sign and

comply with the attached Employee Proprietary Information and Inventions Agreement which prohibits unauthorized use or disclosure of Company proprietary information. This offer is contingent upon a background check clearance. In addition as part of your duties for Omnicell, you may be assigned to work onsite with an Omnicell customer or otherwise to provide services to or interact with an Omnicell customer. Some of these customers have additional requirements that they impose upon individuals who work onsite at their facility or have access to their patient health information, including, but not limited to, the requirement that you submit to drug-testing, testing for various infectious diseases and/or background/screening checks. If you are assigned to work with such a customer, you will be given notice of the customer’s additional requirements and will be required to fulfill these requirements as a condition of your employment with Omnicell. You agree to assist as needed and to complete any documentation at the Company’s request to meet these conditions.

This letter, together with your Employee Proprietary Information and Inventions Agreement, and your Noncompetition Agreement with Omnicell dated on or about May 21, 2012 forms the complete and exclusive statement of your employment agreement with Omnicell. It supersedes any other agreements or promises made to you by anyone, whether oral or written, including that certain Employment Agreement between you and MTS Medication Technologies, Inc. dated January 30, 2011 (“MTS Employment Agreement”). Changes in your employment terms, other than those changes expressly reserved to the Company’s discretion in this letter, require a written modification signed by an officer of Omnicell.

If you have any questions, please give Wendi Ellis a call at (615) 564-7183. Please note the above offer is good until May 30, 2012.

I am pleased to confirm your offer to join the Omnicell team. We are excited about the prospect of welcoming MTS employees to the Omnicell family.

Sincerely,

/s/ Randall A. Lipps

Randall A. Lipps

Chairman, President, and Chief Executive Officer

To indicate your acceptance of the company’s offer, please sign and date this letter in the space provided below (as well as the release that is attached to this letter) and return it to Human Resources via confidential fax at (650) 251-6277. A duplicate is enclosed for your records. This letter, along with the Employee Proprietary Information and Inventions Agreement, Policy Against Trading on the Basis of Inside Information and the Code of Ethics between you and the Omnicell, set forth the terms of your employment with Omnicell or a subsidiary of Omnicell and supersede any prior representations or agreements, whether written or oral. This letter may not be modified or amended except by a written agreement, signed by Omnicell and by you.

_/s/ William Shields_________________________        __5/27/12_______________

Signature                        Date

EXHIBIT A

GENERAL RELEASE

This General Release (“Release”) is entered into between the individual named in the “Employee” section of the signature block below (“Employee”), and Omnicell, Inc. (“Omnicell”) (collectively, “the Parties”).

WHEREAS, although Omnicell is under no obligation to do so, in connection with the anticipated acquisition by Omnicell of Employee’s current employer, MTS Medication Technologies, Inc. (“MTS”), Omnicell is prepared to provide to Employee an offer of employment with Omnicell or MTS, effective as of the actual closing of the acquisition of MTS. In exchange for the good and valuable consideration set forth herein, the Parties agree as follows:

1.General Release of Claims by Employee. To the maximum extent permitted by law, Employee agrees for himself/herself and his/her heirs, beneficiaries, devisees, executors, administrators, attorneys, personal representatives, successors and assigns, hereby forever to release, and discharge MTS, its past, present, or future parents, subsidiaries, and/or other affiliates; all of the past and present directors, officers, shareholders, employees and other agents and representatives of such entities; and any employee benefit plans in which Employee is or has been a participant by virtue of employment with MTS from or for any and all claims, debts, demands, accounts, judgments, rights, causes of action, claims for equitable relief, damages, costs, obligations, responsibility and liability of every kind and character whatever (including attorneys’ fees and costs), whether in law or equity, known or unknown, asserted or unasserted, suspected or unsuspected, which Employee has against such entities as of the execution of this Release, including without limitation any and all claims Employee might have by virtue of his status, if any, as a shareholder of MTS or any affiliated entity of MTS, any and all claims arising out of Employee’s employment with MTS or the termination thereof, any claims arising from the MTS Employment Agreement, the MTS Medication Technologies, Inc. Management Bonus Plan, and any and all claims arising under federal, state, or local laws relating to employment, including without limitation claims of wrongful discharge, retaliation, breach of express or implied contract, fraud, misrepresentation, defamation, or liability in tort, claims of any kind that may be brought in any court or administrative agency, including without limitation claims under Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act, the Family and Medical Leave Act, and similar state or local statutes, ordinances, and regulations, provided, however, that notwithstanding the foregoing or anything else contained in this Release, this Release shall not extend to: (i) any vested, unpaid rights under any pension, retirement or similar plan or any other rights under such plans which are inalienable under the terms of such plans; or (ii) Employee’s rights, if any, to indemnification, and/or defense under any MTS or Omnicell certificate of incorporation, bylaw and/or policy or procedure, or under any insurance contract; or (iii) Employee’s rights, where applicable, to file and/or participate in any administrative proceeding of any federal, state or local government agency; however, Employee shall not be entitled to recover any monetary relief or other individual remedy in connection with proceeding or any ensuing litigation; or (iv) any rights arising under the offer letter agreement between Employee and Omnicell dated May 24, 2012.

2.    Release of Age Discrimination Claims; Periods for Review and Reconsideration.

a.    Employee understands and agrees that this Release includes a release of claims arising under the Age Discrimination in Employment Act (ADEA), and that this Release does not waive rights or claims that may arise after the date the waiver is executed. Employee understands and warrants that Employee has a period of twenty-one (21) days to review and consider this Release. Employee is hereby advised to consult with an attorney prior to executing the Release. By Employee’s signature below, Employee warrants that Employee has had the opportunity to do so and to be fully and fairly advised by that legal counsel as to the terms of the Release. Employee further understands that Employee may use as much or all of this 21-day period as Employee wishes before signing.

b.    Employee further understands that Employee has seven (7) days after signing this Release to revoke the Release by notice in writing to: Rob Seim, CFO Omnicell, Inc., 1201 Charleston Road, Mountain View, CA 94043 (“Omnicell Contact”). This Release shall be binding, effective, and enforceable upon Employee upon the expiration of this seven-day revocation period without the Omnicell Contact having received such revocation, but not before such time.

3.    Waiver of California Civil Code § 1542. Employee hereby agrees to waive Section 1542 of the California Civil Code (or any similar provision of any other state), which states:

A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor.

4.    No Admission. Employee understands and agrees that neither Omnicell nor MTS has admitted any liability or obligation to provide the consideration contemplated herein.

5.    Severability and Consequences of Invalid Terms. Should any portion or provision of this Release be found void or unenforceable for any reason by a court of competent jurisdiction, the Parties intend that all portions and provisions of this Release be enforced to the maximum extent they would have been enforceable in the original Release. If such portion or provision cannot be so modified to be enforceable, the unenforceable portion shall be deemed severed from the remaining portions and provisions of this Release, which shall otherwise remain in full force and effect.

6.    Counterparts. This Release may be executed in two or more counterparts, each of which will be deemed an original, but all of which together shall constitute one and the same instrument.

7.    Governing Law. This Release shall be governed and construed in all respects in accordance with the laws of the State of California without regard to the conflict of laws rules contained therein.

8.    Understanding and Authority. There are no representations, promises or agreements between Omnicell, MTS and/or Employee other than those expressly set forth herein. The Parties have read this Release in its entirety; fully understand and agree to its terms and provisions; and intend and agree that it be final and binding.

IN WITNESS WHEREOF, and intending to be legally bound, the Parties have executed the foregoing on the dates shown below.

Employee:    William Shields        Omnicell, Inc.

/s/ William Shields 5/27/12    /s/ Robin Seim 5/24/2012    

Signature    Date        Signature    Date

CFO    

Title

EXHIBIT B

Release and Waiver for Severance upon Termination

as a Result of the Transactions Contemplated

in the Merger Agreement (Change In Control)

[TO BE SIGNED ON OR AFTER EMPLOYMENT TERMINATION DATE]

1.General Release. In exchange for the consideration provided to Employee pursuant to the offer letter agreement with Omnicell, Inc. (“Omnicell”) dated May 24, 2012 (“Offer Letter Agreement”), that Employee is not otherwise entitled to receive, Employee hereby generally and completely releases Omnicell, Inc., MedPak Holdings, Inc., MTS Medication Technologies, Inc., and their respective current and former directors, officers, employees, shareholders, partners, agents, attorneys, predecessors, successors, parent and subsidiary entities, insurers, affiliates, and assigns from any and all claims, liabilities and obligations, both known and unknown, that arise out of or are in any way related to events, acts, conduct, or omissions occurring prior to Employee’s signing this Release. This general release includes, but is not limited to: (1) all claims arising out of or in any way related to Employee’s employment with Omnicell or the termination of that employment; (1) all claims related to Employee’s compensation or benefits from Omnicell, including salary, bonuses, commissions, vacation pay, expense reimbursements, severance pay, fringe benefits, stock, stock options, or any other ownership interests in Omnicell; (1) all claims for breach of contract, wrongful termination, and breach of the implied covenant of good faith and fair dealing; claims under the MTS Employment Agreement (as defined in the Offer Letter Agreement); (1) all tort claims, including claims for fraud, defamation, emotional distress, and discharge in violation of public policy; and (1) all federal, state, and local statutory claims, including claims for discrimination, harassment, retaliation, attorneys’ fees, or other claims arising under the federal Civil Rights Act of 1964 (as amended), the federal Americans with Disabilities Act of 1990, the federal Age Discrimination in Employment Act of 1967 (as amended) (“ADEA”), the federal Family and Medical Leave Act, and the Florida Civil Rights Act of 1992 (as amended).

2.Exceptions. Employee is not releasing any claim that cannot be waived under applicable state or federal law. Employee is not releasing any rights that Employee may have to be indemnified (including any right to reimbursement of expenses) arising under applicable law, the certificate of incorporation or by-laws (or similar constituent documents of Omnicell), any indemnification agreement between Employee and Omnicell, or any directors’ and officers’ liability insurance policy of Omnicell. Nothing in this Release shall prevent Employee from filing, cooperating with, or participating in any proceeding before the Equal Employment Opportunity Commission, the Department of Labor, or the Florida Commission on Human Relations, except that Employee hereby acknowledges and agrees that Employee shall not recover any monetary benefits in connection with any such proceeding with regard to any claim released in this Release. Nothing in this Release shall prevent Employee from challenging the validity of the Release in a legal or administrative proceeding.

3.ADEA Waiver. Employee acknowledges that Employee is knowingly and voluntarily waiving and releasing any rights Employee may have under the ADEA (“ADEA Waiver”). Employee also acknowledges that the consideration given for the ADEA Waiver is in addition to anything of value to which Employee was already entitled. Employee further acknowledges that Employee has been advised by this writing, as required by the ADEA, that: (3) Employee’s ADEA Waiver does not apply to any rights or claims that arise after the date Employee signs this Release; (3) Employee should consult with an attorney prior to signing this Release; (3) Employee has twenty-one (21) days to consider this Release (although Employee may choose to voluntarily sign it sooner); (3) Employee has seven (7) days following the date Employee signs

this Release to revoke the ADEA Waiver; and (3) the ADEA Waiver will not be effective until the date upon which the revocation period has expired unexercised, which will be the eighth day after Employee signs this Release.

4.Section 1542 Waiver. In giving the release herein, which includes claims which may be unknown to Employee at present, Employee acknowledges that Employee has read and understands Section 1542 of the California Civil Code, which reads as follows:

“A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor.”

Employee hereby expressly waives and relinquishes all rights and benefits under that section and any law of any other jurisdiction of similar effect with respect to Employee’s release of any unknown or unsuspected claims herein. Employee has read this Release, fully understands it and freely and knowingly agrees to its terms.

I UNDERSTAND THAT THIS RELEASE INCLUDES A GENERAL RELEASE OF ALL KNOWN AND UNKNOWN CLAIMS, EVEN THOSE UNKNOWN CLAIMS, THAT, IF KNOWN BY ME, WOULD AFFECT MY DECISION TO ACCEPT THE AGREEMENT AND GIVE THIS RELEASE.

Given this __ day of ____ , 2012

William Shields

EX-10.3

Exhibit 10.3

Change of Control Agreement

May 23, 2012

William Shields

Dear Bill:

This letter serves to set forth the following benefit to be provided to you in the event of an Acquisition (as defined below) of Omnicell, Inc. (the “Company”).

Provided one of the following events occurs within twelve (12) months following an Acquisition: (i) you are terminated without Cause (as defined below); (ii) the principal place of the performance of your responsibilities and duties is changed to a location that is more than 30 miles away from St. Petersburg. Florida; or (iii) there is a material reduction in your responsibilities and duties without Cause; then (a) you shall receive severance pay equivalent to twelve (12) months salary at your base rate of pay in effect immediately prior to the occurrence of any of the triggering event described above (and further provided that you execute Omnicell’s standard waiver and release agreement); and (b) the unvested portion of each of the stock options granted to you under the Company’s 2009 Equity Incentive Plan, shall accelerate and immediately become fully-vested and exercisable.

An “Acquisition” as used herein shall mean any consolidation or merger of the Company with or into any other corporation or other entity or person in which the stockholders of the Company prior to such consolidation, merger or reorganization shall own less than fifty percent (50%) of the voting stock of the continuing or surviving entity of such consolidation, merger or reorganization, any other corporate reorganization in which in excess of fifty percent (50%) of the Company’s voting power is transferred , or any transaction in which any person, together with its affiliates, accumulates fifty percent or more of the Company’s voting power.

As used herein, “Cause” shall mean: (i) conviction of any felony; (ii) participation in fraud, misappropriation, embezzlement or other similar act of dishonesty or material misconduct against the Company or any subsidiaries or affiliates thereof; or (iii) participation in any act materially contrary to the Company’s best interest.

Acceleration may be limited in certain circumstances, in particular, if any such acceleration the (“Benefit”) would (i) constitute a “parachute payment” within the meaning of Section 280G of the Internal Revenue Code and (ii) but for this amendment, be subject to the excise tax imposed by Section 4999 of the Internal Revenue Code, then such Benefit will be reduced to the extent necessary so that no portion of the Benefit would be subject to the excise tax, as determined in good faith by the Company; provided, however, that if, in the absence of any such reduction (or after such reduction), you believe that the Benefit or any portion thereof (as reduced, if applicable) would be subject to the excise tax, the Benefit shall be reduced (or further reduced) to the extent determined by you in your discretion so that the excise tax would not apply. If, not withstanding any such reduction (or in the absence of such reduction), the Internal Revenue Service determines that you are liable for the excise tax as a result of the Benefit, then you will be obligated to return to the Company, within thirty (30) days of such determination by the IRS, a portion of the Benefit sufficient such that none of the benefit retained by you constitutes a “parachute payment” within the meaning of Code Section 280G that is subject to the excise tax.

Should you have any questions regarding this matter, please contact me at 650-251-6120.

/s/ Randall A. Lipps

Randall A. Lipps

Chairman, President and Chief Executive Officer

Omnicell, Inc.

ADDENDUM TO CHANGE IN CONTROL SEVERANCE LETTER

This Addendum modifies the severance pay provisions contained in a letter (the “CiC Severance Letter”) from Omnicell, Inc. (the “Company”) to William Shields (the “Executive”) as it relates to payment of severance benefits in connection with the Acquisition of the Company (the “CiC Severance Benefits”). Terms not defined herein shall have the meanings ascribed to them in the CiC Severance Letter. Executive and the Company hereby agree as follows:

Entitlement to Severance Benefits. The CiC Severance Benefits are payable to Executive only if within twelve (12) months following an Acquisition either (i) Executive suffers a separation from service from the Company due to an involuntary termination without Cause, (ii) the principal place of performance of Executive’s responsibilities and to a location that is more than 30 miles away from St. Petersburg. Florida, or (iii) there is a material reduction in Executive’s responsibilities and duties without Cause; provided however that, Executive shall be entitled to the CiC Severance Benefits due to an event described in (ii) or (iii) above only if (x) the Company is given written notice from the Executive within sixty (60) days following the first of such event describing the condition, (y) the Company fails to satisfactorily remedy such condition within thirty (30) days following such written notice, and (z) the Executive terminates employment within thirty (30) days following the end of the period within which the Company was entitled to remedy the condition but failed to do so.

Application of Internal Revenue Code Section 409A. Notwithstanding anything to the contrary herein, the following provisions apply to the extent severance benefits provided in Executive’s CiC Severance Letter are subject to Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) and the regulations and other guidance thereunder and any state law of similar effect (collectively “Section409A”). Severance benefits shall not commence until Executive has a “separation from service” for purposes of Section 409A. Severance benefits are intended to comply with the provisions of Section 409A. As such, if Executive is, upon separation from service, a “specified employee” for purposes of Section 409A, then, solely to the extent necessary to avoid adverse personal tax consequences under Section 409A, the timing of the severance benefits payments shall be delayed until the earlier of (i) six (6) months and one day after Executive’s separation from service, or (ii) Executive’s death. Executive shall receive severance benefits only if Executive executes and returns to the Company, within the applicable time period set forth therein but in no event more than forty-five (45) days following the date of separation from service, a separation agreement containing the Company’s standard form of release of claims in favor of the Company, and permits such release to become effective in accordance with its terms (such latest permitted date, the “Separation Agreement Deadline”). If the severance benefits are not covered by one or more exemptions from the application of Section 409A and the separation agreement could become effective in the calendar year following the calendar year in which Executive separates from service, the separation agreement will not be deemed effective any earlier than the Separation Agreement Deadline. None of the severance benefits will be paid or otherwise delivered prior to the effective date of the separation agreement. Except to the minimum extent that payments must be delayed because Executive is a “specified employee” or until the effectiveness of the separation agreement, all severance benefits will be paid in a lump sum on the 60^th day following Executive’s separation from service. The severance benefits are intended to qualify for an exemption from application of Section 409A or comply with its requirements to the extent necessary to avoid adverse personal tax consequences under Section 409A, and any ambiguities herein shall be interpreted accordingly.

OMNICELL, INC.

/s/ Randall A. Lipps	6/22/2012
By: Randall A. Lipps	Date

/s/ William Shields	6/24/2012
William Shields	Date

EX-10.4

Exhibit 10.4

OMNICELL, INC.

2009 EQUITY INCENTIVE PLAN

RESTRICTED STOCK UNIT AWARD AGREEMENT

ADOPTED BY THE COMPENSATION COMMITTEE

OF THE BOARD OF DIRECTORS: JUNE 5, 2012

Pursuant to the Restricted Stock Unit Grant Notice (“Grant Notice”) and this Restricted Stock Unit Award Agreement, including any country-specific appendix thereto (the “Agreement”) and in consideration of your services, Omnicell, Inc. (the “Company”) has awarded you a Restricted Stock Unit Award (the “Award”) under its 2009 Equity Incentive Plan (the “Plan”). Your Award is granted to you effective as of the Date of Grant set forth in the Grant Notice for this Award. This Agreement shall be deemed to be agreed to by the Company and you upon the acceptance by you of the Restricted Stock Unit Award Grant Notice to which it is attached. Defined terms not explicitly defined in this Agreement shall have the same meanings given to them in the Plan. In the event of any conflict between the terms in this Agreement and the Plan, the terms of the Plan shall control. The details of your Award, in addition to those set forth in the Grant Notice and the Plan, are as follows.

1.GRANT OF THE AWARD. This Award represents the right to be issued on a future date the number of shares of the Company’s Common Stock as indicated in the Grant Notice. As of the Date of Grant, the Company will credit to a bookkeeping account maintained by the Company for your benefit (the “Account”) the number of shares of Common Stock subject to the Award. This Award was granted in consideration of your services to the Company or an Affiliate. Except as otherwise provided herein, you will not be required to make any payment to the Company (other than services to the Company or an Affiliate) with respect to your receipt of the Award, the vesting of the shares or the delivery of the underlying Common Stock.

2.VESTING. Subject to the limitations contained herein, your Award will vest, if at all, in accordance with the vesting schedule provided in the Grant Notice, provided that vesting will cease upon the termination of your Continuous Service (regardless of the reason for such termination and whether or not later found to be invalid or in breach of employment laws in the jurisdiction where you are employed or the terms of your employment agreement, if any), and unless otherwise expressly provided in this Agreement or determined by the Company, your right to vest in the RSU under the Plan, if any, will terminate as of such date and will not be extended by any notice period (e.g., your period of service would not include any contractual notice period or any period of “garden leave” or similar period mandated under employment laws in the jurisdiction where you are employed or the terms of your employment agreement, if any); the Committee shall have the exclusive discretion to determine when you are no longer providing Continuous Services for purposes of your RSU grant (including whether you may still be considered to be providing services while on a leave of absence). Upon such termination of your Continuous Service, the shares credited to the Account that were not vested on the date of such termination will be forfeited at no cost to the Company and you will have no further right, title or interest in or to such underlying shares of Common Stock.

3.NUMBER OF SHARES.

(a)    The number of shares subject to your Award may be adjusted from time to time for Capitalization Adjustments, as provided in the Plan.

(b)    Any shares, cash or other property that becomes subject to the Award pursuant to this Section 3, if any, shall be subject, in a manner determined by the Board, to the same forfeiture restrictions, restrictions on transferability, and time and manner of delivery as applicable to the other shares covered by your Award.

(c)    Notwithstanding the provisions of this Section 3, no fractional shares or rights for fractional

GESDMS/6583294.3 1.

shares of Common Stock shall be created pursuant to this Section 3. The Board shall, in its discretion, determine an equivalent benefit for any fractional shares or fractional shares that might be created by the adjustments referred to in this Section 3.

4.SECURITIES LAW COMPLIANCE. You may not be issued any shares under your Award unless either (i) the shares are registered under the Securities Act; or (ii) the Company has determined that such issuance would be exempt from the registration requirements of the Securities Act. Your Award also must comply with other applicable securities and exchange control laws and regulations relevant to the Company and the offer of the RSUs and the underlying shares of Common Stock, and you will not receive such shares if the Company determines that such receipt would not be in material compliance with such laws and regulations.

5.LIMITATIONS ON TRANSFER. Your Award is not transferable, except by will or by the laws of descent and distribution. In addition to any other limitation on transfer created by applicable securities laws, you agree not to assign, hypothecate, donate, encumber or otherwise dispose of any interest in any of the shares of Common Stock subject to the Award until the shares are issued to you in accordance with Section 6 of this Agreement. After the shares have been issued to you, you are free to assign, hypothecate, donate, encumber or otherwise dispose of any interest in such shares provided that any such actions are in compliance with the provisions herein and applicable securities laws. Notwithstanding the foregoing, by delivering written notice to the Company, in a form satisfactory to the Company, you may designate a third party who, in the event of your death, shall thereafter be entitled to receive any distribution of Common Stock to which you were entitled at the time of your death pursuant to this Agreement.

6.DATE OF ISSUANCE. The Company will deliver to you a number of shares of the Company’s Common Stock equal to the number of vested shares subject to your Award, including any additional shares received pursuant to Section 3 above that relate to those vested shares on the applicable vesting date(s). However, if a scheduled delivery date falls on a date that is not a U.S. business day, such delivery date shall instead fall on the next following U.S. business day. The form of such delivery (e.g., a stock certificate or electronic entry evidencing such shares) shall be determined by the Company.

7.DIVIDENDS. You shall receive no benefit or adjustment to your Award with respect to any cash dividend, stock dividend or other distribution that does not result from a Capitalization Adjustment as provided in Section 9(a) of the Plan; provided, however, that this sentence shall not apply with respect to any shares of Common Stock that are delivered to you in connection with your Award after such shares have been delivered to you.

8.RESTRICTIVE LEGENDS. The shares issued under your Award shall be endorsed with appropriate legends determined by the Company.

9.AWARD NOT A SERVICE CONTRACT.

(a)    Your Continuous Service with the Company or an Affiliate is not for any specified term and may be terminated by you or by the Company or an Affiliate at any time, for any reason. Nothing in this Agreement (including, but not limited to, the vesting of your Award pursuant to the schedule set forth in Section 2 herein or the issuance of the shares subject to your Award), the Plan or any covenant of good faith and fair dealing that may be found implicit in this Agreement or the Plan shall:  (i) confer upon you any right to continue in the employ of, or affiliation with, the Company or an Affiliate; (ii) constitute any promise or commitment by the Company or an Affiliate regarding the fact or nature of future positions, future work assignments, future compensation or any other term or condition of employment or affiliation; (iii) confer any right or benefit under this Agreement or the Plan unless such right or benefit has specifically accrued under the terms of this Agreement or Plan; or (iv) deprive the Company or an Affiliate of the right to terminate you and without regard to any future vesting opportunity that you may have.

(b)    By accepting this Award, you acknowledge and agree that the right to continue vesting in the Award pursuant to the schedule set forth in Section 2 is earned only by continuing to provide Continuous Service (not through the act of being hired, being granted this Award or any other award

GESDMS/6583294.3 2.

or benefit) and that the Company has the right to reorganize, sell, spin-out or otherwise restructure one or more of its businesses or Affiliates at any time or from time to time, as it deems appropriate (a “reorganization”).  You further acknowledge and agree that such a reorganization could result in the termination of your Continuous Service, or the termination of Affiliate status of your employer and the loss of benefits available to you under this Agreement, including but not limited to, the termination of the right to continue vesting in the Award. You further acknowledge and agree that this Agreement, the Plan, the transactions contemplated hereunder and the vesting schedule set forth herein or any covenant of good faith and fair dealing that may be found implicit in any of them do not constitute an express or implied promise of continued engagement for the term of this Agreement, for any period, or at all, and shall not interfere in any way with your right or the Company’s right to terminate your Continuous Service at any time.

(c)    No claim or entitlement to compensation or damages shall arise from forfeiture of the RSU resulting from the termination of your Continuous Service (for any reason whatsoever, whether or not later found to be invalid or in breach of employment laws in the jurisdiction where you are employed or the terms of your employment agreement, if any), and in consideration of the grant of the RSU to which you are otherwise not entitled, you irrevocably agree never to institute any claim against the Company, any of its Subsidiaries or Affiliates or your Employer (the “Employer”), waive your ability, if any, to bring any such claim, and release the Company, its subsidiaries and affiliates and the Employer from any such claim; if, notwithstanding the foregoing, any such claim is allowed by a court of competent jurisdiction, then, by participating in the Plan, you shall be deemed irrevocably to have agreed not to pursue such claim and agree to execute any and all documents necessary to request dismissal or withdrawal of such claim.

10.RESPONSIBILITY FOR TAXES.

(a)    You acknowledge that, regardless of any action taken by the Company or, if different, the Employer, the ultimate liability for all income tax, social insurance, payroll tax, fringe benefits tax, payment on account or other tax-related items related to your participation in the Plan and legally applicable to you (“Tax-Related Items”), is and remains your responsibility and may exceed the amount actually withheld by the Company or the Employer. You further acknowledge that the Company and/or the Employer (i) make no representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of the RSU, including, but not limited to, the grant, vesting or settlement of the RSU, the subsequent sale of shares of Common Stock acquired pursuant to such settlement and the receipt of any dividends; and (ii) do not commit to and are under no obligation to structure the terms of the grant or any aspect of the RSU to reduce or eliminate your liability for Tax-Related Items or achieve any particular tax result. Further, if you are subject to Tax-Related Items in more than one jurisdiction between the date of grant and the date of any relevant taxable or tax withholding event, as applicable, you acknowledge that the Companyand/or the Employer (or former employer, as applicable) may be required to withhold or account for Tax-Related Items in more than one jurisdiction.

On or before the time you receive a distribution of the shares in respect of your Award, or at any time thereafter as requested by the Company and/or the Employer, you hereby authorize any required withholding from the Common Stock issuable to you and/or otherwise agree to make adequate provision in cash for any sums required to satisfy the Tax-Related Items. Except as provided below, the Company shall withhold from the shares of Common Stock issuable to you to satisfy the Tax-Related Items. By your acceptance of the RSU, you agree that: (i) in the event that such withholding from the shares of Common Stock is problematic under applicable tax or securities law or has materially adverse accounting consequences, the Company shall instead withhold from any other compensation paid to you by the Company or the Employer in partial or full satisfaction of the Tax-Related Items, and (ii) the Company may determine in its sole discretion to instead withhold from any other compensation paid to you by the Company or the Employer in partial or full satisfaction of the Tax-Related Items, provided that if you are subject to reporting obligations under Section 16

GESDMS/6583294.3 3.

of the Exchange Act, exercise of such discretion is subject to the prior approval and direction of the Committee. In no way limiting the foregoing, the Company is hereby authorized to withhold shares of Common Stock that are otherwise to be issued and delivered to you under this Award in partial or full satisfaction of the Tax-Related Items; provided, however, that no shares of Common Stock shall be withheld with a value exceeding the minimum amount of tax required to be withheld by law. If the obligation for Tax-Related Items is satisfied by withholding in shares of Common Stock, for tax purposes, you are deemed to have been issued the full number of shares of Common Stock subject to the vested RSU, notwithstanding that a number of the shares of Common Stock are held back solely for the purpose of paying the Tax-Related Items.

(b)    You agree to pay the Company or the Employer any amount of Tax-Related Items that the Company or the Employer may be required to withhold or account for as a result of your participation in the Plan that cannot be satisfied by the means previously described. Unless the obligation for Tax-Related Items is satisfied, the Company shall have no obligation to deliver to you any Common Stock.

(c)    In the event the obligation of the Company and/or any Affiliate to withhold arises prior to the delivery to you of Common Stock or it is determined after the delivery of Common Stock to you that the amount of the withholding obligation was greater than the amount withheld by the Company and/or any Affiliate, you agree to indemnify and hold the Company and its Affiliates harmless from any failure by the Company and/or any Affiliate to withhold the proper amount.

11.UNSECURED OBLIGATION. Your Award is unfunded, and as a holder of a vested Award, you shall be considered an unsecured creditor of the Company with respect to the Company’s obligation, if any, to issue shares pursuant to this Agreement. You shall not have voting or any other rights as a stockholder of the Company with respect to the shares to be issued pursuant to this Agreement until such shares are issued to you pursuant to Section 6 of this Agreement. Upon such issuance, you will obtain full voting and other rights as a stockholder of the Company. Nothing contained in this Agreement, and no action taken pursuant to its provisions, shall create or be construed to create a trust of any kind or a fiduciary relationship between you and the Company or any other person.

12.NOTICES. Any notices provided for in your Award or the Plan shall be given in writing and shall be deemed effectively given upon receipt or, in the case of notices delivered by the Company to you, five (5) days after deposit in the United States mail, postage prepaid, addressed to you at the last address provided to the Company. Notwithstanding the foregoing, the Company may, in its sole discretion, decide to deliver any documents related to participation in the Plan and this Award by electronic means or to request your consent to participate in the Plan by electronic means. You hereby consent to receive such documents by electronic delivery and, if requested, to agree to participate in the Plan through an on-line or electronic system established and maintained by the Company or another third party designated by the Company.

13.NATURE OF GRANT. In accepting the grant, you acknowledge, understand and agree that:

(a)    the Plan is established voluntarily by the Company, it is discretionary in nature and it may be modified, amended, suspended or terminated by the Company at any time, to the extent permitted by the Plan;

(b)    the grant of the RSU is voluntary and occasional and does not create any contractual or other right to receive future grants of RSUs, or benefits in lieu of RSUs, even if RSUs have been granted in the past;

(c)    all decisions with respect to future RSU or other grants, if any, will be at the sole discretion of the Company;

(d)    you are voluntarily participating in the Plan;

(e)    the RSU and the shares of Common Stock subject to the RSU are not intended to replace

GESDMS/6583294.3 4.

any pension rights or compensation;

(f)    the RSU and the shares of Common Stock subject to the RSU, and the income and value of same, are not part of normal or expected compensation for purposes of calculating any severance, resignation, termination, redundancy, dismissal, end-of-service payments, bonuses, long-service awards, pension or retirement or welfare benefits or similar payments;

(g)    the future value of the underlying shares of Common Stock is unknown, indeterminable and cannot be predicted with certainty; and

(h)    the following provisions apply only if you are providing services outside the United States:

(i)    the RSU and the shares of Common Stock subject to the RSU are not part of normal or expected compensation or salary for any purpose; and

(ii)    you acknowledge and agree that neither the Company, the Employer nor any Subsidiary or Affiliate of the Companyshall be liable for any foreign exchange rate fluctuation between your local currency and the United States Dollar that may affect the value of the RSU or of any amounts due to you pursuant to the settlement of the RSU or the subsequent sale of any shares of Common Stock acquired upon settlement.

14.NO ADVICE REGARDING GRANT. The Company is not providing any tax, legal or financial advice, nor is the Company making any recommendations regarding your participation in the Plan, or your acquisition or sale of the underlying shares of Common Stock. You are hereby advised to consult with your own personal tax, legal and financial advisors regarding your participation in the Plan before taking any action related to the Plan.

15.DATA PRIVACY. You hereby explicitly and unambiguously consent to the collection, use and transfer, in electronic or other form, of your personal data as described in this Agreement and any other RSU grant materials (“Data”) by and among, as applicable, the Employer, the Company and its Subsidiaries and Affiliates for the exclusive purpose of implementing, administering and managing your participation in the Plan.

You understand that the Company and the Employer may hold certain personal information about you, including, but not limited to, your name, home address and telephone number, date of birth, social insurance number or other identification number, salary, nationality, job title, any shares of stock or directorships held in the Company, details of all RSUs or any other entitlement to shares of stock awarded, canceled, exercised, vested, unvested or outstanding in your favor, for the exclusive purpose of implementing, administering and managing the Plan.

You understand that Data will be transferred to such stock plan service provider as may be selected by the Company in the future, which is assisting the Company with the implementation, administration and management of the Plan. You understand that the recipients of the Data may be located in the United States or elsewhere, and that the recipients’ country (e.g., the United States) may have different data privacy laws and protections than your country. You understand that if you reside outside the United States, you may request a list with the names and addresses of any potential recipients of the Data by contacting your local human resources representative. You authorize the Company and any other possible recipients which may assist the Company (presently or in the future) with implementing, administering and managing the Plan to receive, possess, use, retain and transfer the Data, in electronic or other form, for the sole purpose of implementing, administering and managing your participation in the Plan. You understand that Data will be held only as long as is necessary to implement, administer and manage your participation in the Plan. You understand that if you reside outside the United States, you may, at any time, view Data, request additional information about the storage and processing of Data, require any necessary amendments to Data or refuse or withdraw the consents herein, in any case without cost, by contacting in writing your local human resources representative. Further, you understand that you are providing the consents herein on a purely voluntary basis. If you do not consent, or if you later seek to revoke your consent, your employment status or service and career with the Employer will not be adversely affected; the only adverse consequence of refusing or withdrawing your consent is that the Company would not be able to grant you RSUs or other equity awards or

GESDMS/6583294.3 5.

administer or maintain such awards. Therefore, you understand that refusing or withdrawing your consent may affect your ability to participate in the Plan. For more information on the consequences of your refusal to consent or withdrawal of consent, you understand that you may contact your local human resources representative.

16.MISCELLANEOUS.

(a)    The rights and obligations of the Company under your Award shall be transferable to any one or more persons or entities, and all covenants and agreements hereunder shall inure to the benefit of, and be enforceable by the Company’s successors and assigns. Your rights and obligations under your Award may only be assigned with the prior written consent of the Company.

(b)    You agree upon request to execute any further documents or instruments necessary or desirable in the sole determination of the Company to carry out the purposes or intent of your Award.

(c)    You acknowledge and agree that you have reviewed your Award in its entirety, have had an opportunity to obtain the advice of counsel prior to executing and accepting your Award, and fully understand all provisions of your Award.

(d)    This Agreement shall be subject to all applicable laws, rules, and regulations, and to such approvals by any governmental agencies or national securities exchanges as may be required.

(e)    All obligations of the Company under the Plan and this Agreement shall be binding on any successor to the Company, whether the existence of such successor is the result of a direct or indirect purchase, merger, consolidation, or otherwise, of all or substantially all of the business and/or assets of the Company.

17.GOVERNING PLAN DOCUMENT. Your Award is subject to all the provisions of the Plan, the provisions of which are hereby made a part of your Award, and is further subject to all interpretations, amendments, rules and regulations which may from time to time be promulgated and adopted pursuant to the Plan. Except as expressly provided herein, in the event of any conflict between the provisions of your Award and those of the Plan, the provisions of the Plan shall control.

18.LANGUAGE. If you have received this Agreement or any other document related to the Plan translated into a language other than English and if the meaning of the translated version is different than the English version, the English version will control.

19.SEVERABILITY. If all or any part of this Agreement or the Plan is declared by any court or governmental authority to be unlawful or invalid, such unlawfulness or invalidity shall not invalidate any portion of this Agreement or the Plan not declared to be unlawful or invalid. Any Section of this Agreement (or part of such a Section) so declared to be unlawful or invalid shall, if possible, be construed in a manner which will give effect to the terms of such Section or part of a Section to the fullest extent possible while remaining lawful and valid.

20.CHOICE OF LAW; VENUE. The interpretation, performance and enforcement of this Agreement will be governed by the law of the state of California without regard to such state’s conflicts of laws rules. For purposes of any action, lawsuit or other proceedings brought to enforce this Agreement, relating to it, or arising from it, the parties hereby submit to and consent to the sole and exclusive jurisdiction of the courts of Santa Clara County, California, or the federal courts for the United States for the Northern District of California, and no other courts, where this grant is made and/or to be performed.

21.AMENDMENT. This Agreement may not be modified, amended or terminated except by an instrument in writing, signed or otherwise accepted by you and by a duly authorized representative of the Company. Notwithstanding the foregoing, this Agreement may be amended solely by the Board by a writing which specifically states that it is amending this Agreement, so long as a copy of such amendment is delivered to you, and provided that no such amendment adversely affecting your rights hereunder may be made without your written consent. Without

GESDMS/6583294.3 6.

limiting the foregoing, the Board reserves the right, by written notice to you, to impose new provisions or to change the existing provisions of this Agreement in any way it may deem necessary or advisable for legal or administrative reasons to carry out the purpose of the grant.

22.APPENDIX. Notwithstanding any provisions in this Agreement, the RSU grant shall be subject to any special terms and conditions set forth in any Appendix to this Agreement for your country. Moreover, if you relocate to one of the countries included in the Appendix, the special terms and conditions for such country will apply to you, to the extent the Company determines that the application of such terms and conditions is necessary or advisable for legal or administrative reasons. The Appendix constitutes part of this Agreement.

23.WAIVER. You acknowledge that a waiver by the Company of breach of any provision of this Agreement shall not operate or be construed as a waiver of any other provision of this Agreement, or of any subsequent breach by you or any other Participant.

24.ELECTRONIC DELIVERY AND ACCEPTANCE. The Company may, in its sole discretion, decide to deliver any documents related to current or future participation in the Plan by electronic means. You hereby consent to receive such documents by electronic delivery and agree to participate in the Plan through an on-line or electronic system established and maintained by the Company or a third party designated by the Company.

* * * * *

GESDMS/6583294.3 7.

APPENDIX

OMNICELL, INC.

2009 EQUITY INCENTIVE PLAN

RESTRICTED STOCK UNIT AWARD AGREEMENT

Terms and Conditions

This Appendix includes additional terms and conditions that govern the RSUs granted to you under the Omnicell, Inc. (the “Company”) 2009 Equity Incentive Plan (the “Plan”) if you reside in one of the countries listed below. Unless otherwise defined herein, the terms defined in the Plan and/or the Restricted Stock Unit Award Agreement (the “Agreement”), as applicable, shall have the same defined meanings in this Appendix.

Notifications

This Appendix also includes information regarding securities, exchange control and certain other issues of which you should be aware with respect to participation in the Plan. The information is based on the securities, exchange control and other laws in effect in the respective countries as of May 2012. Such laws are often complex and change frequently. As a result, the Company strongly recommends that you not rely on the information in this Appendix as the only source of information relating to the consequences of participation in the Plan because the information may be out of date at the time the RSUs vest or shares acquired under the Plan are sold.

In addition, the information contained herein is general in nature and may not apply to your particular situation and the Company is not in a position to assure you of a particular result. Accordingly, you are advised to seek appropriate professional advice as to how the relevant laws in your country may apply to your situation.

Finally, you understand that if you are a citizen or resident of a country other than the one in which you are currently working, transfer employment after the date of grant, or are considered a resident of another country for local law purposes, the information contained herein may not apply to you, and the Company shall, in its discretion, determine to what extent the terms and conditions contained herein shall apply.

Australia

Notifications

Securities Law Information. If you acquire shares upon settlement of the RSUs and you offer the Shares for sale to a person or entity resident in Australia, the offer may be subject to disclosure requirements under Australian law. You should obtain legal advice on disclosure obligations prior to making any such offer.

Canada

Terms and Conditions

Settlement of RSUs.   Notwithstanding any discretion in the Plan or anything to the contrary in the Agreement, the RSUs do not provide any right for you, as a resident of Canada, to receive a cash payment and the RSUs shall be paid in shares of Common Stock only.

The following provisions apply if you are a resident of Quebec:

Language Consent.  The parties acknowledge that it is their express wish that the Agreement, as well as all documents, notices, and legal proceedings entered into, given or instituted pursuant hereto or relating directly or indirectly hereto, be drawn up in English.

GESDMS/6583294.3 8.

Les parties reconnaissent avoir exigé la rédaction en anglais de cette convention (“Agreement”), ainsi que de tous documents exécutés, avis donnés et procédures judiciaries intentées, directement ou indirectement, relativement à ou suite à la présente convention.

Data Privacy Notice and Consent.  This provision supplements Section 15 of the Agreement:

You hereby authorize the Company and the Company’s representative to discuss with and obtain all relevant information from all personnel (professional or not) involved in the administration and operation of the Plan. You further authorize the Company and your Employer to disclose and discuss your participation in the Plan with their advisors. You also authorize the Company and your Employer to record such information and keep it in your employee file.

China

The following provision applies to Participants who are nationals of the People’s Republic of China (“PRC”) residing in the PRC:

Notifications

Exchange Control Requirements. Pursuant to exchange control laws in the PRC, you understand that you may be required, immediately upon vesting of the RSUs, to sell all shares issued and immediately repatriate to the PRC any cash proceeds you receive upon sale of the shares. To facilitate this immediate sale, you agree to execute any documents, authorization or forms that the Company or a third-party broker acting for the Company may request. If you do not execute such documents, you understand that the Company may refuse to issue you any shares at vesting.

If immediate sale of the shares is required, you understand that the repatriation of the cash from the sale of shares may need to be effected through a special exchange control account established by the Company, an Affiliate, or the Employer and you hereby consent and agree that the cash may be transferred to such account on your behalf prior to being delivered to you. You understand that there may be a delay between the date of sale and the date the cash proceeds are distributed to you, and you further understand and agree that the Company will not be responsible for any currency fluctuation that may occur between the date of sale and the date the cash proceeds are distributed to you.

You further agree to comply with any other requirements that may be imposed by the Company in the future to facilitate compliance with exchange control requirements in the PRC.

Germany

Notifications

Exchange Control Information. Cross-border payments in excess of €12,500 must be reported monthly to the German Federal Bank. You are responsible for obtaining the appropriate form from a German federal bank and complying with applicable reporting requirements.

Saudi Arabia

Notifications

Securities Law Information. The Agreement and related RSU documents may not be distributed in the Kingdom of Saudi Arabia except to such persons as are permitted under the Offers of Securities Regulations issued by the Capital Market Authority.

The Capital Market Authority does not make any representation as to the accuracy or completeness of the Agreement, and expressly disclaims any liability whatsoever for any loss arising from, or incurred in reliance upon, any part of the Agreement. You are hereby advised to conduct your own due diligence on the accuracy of the information relating to

GESDMS/6583294.3 9.

the shares. If you do not understand the content of the Agreement, you should consult an authorized financial adviser.

United Arab Emirates

Notifications

Securities Law Information. The Plan is only being offered to qualified employees of the Company and its Affiliates and is in the nature of an “exempt personal offer” of equity incentives to employees of the Company’s Affiliates in the United Arab Emirates. The Plan, the Agreement and any other grant documents you may receive from the Company are intended for distribution only to such employees and must not be delivered to, or relied on by, any other person. Prospective purchasers of the securities offered (i.e., shares) should conduct their own due diligence on the securities. If you do not understand the contents of the Plan or the Agreement, you should consult an authorized financial adviser. The Emirates Securities and Commodities Authority and the Dubai Financial Services Authority have no responsibility for reviewing or verifying any documents in connection with the Plan. The Ministry of Economy, the Dubai Department of Economic Development, Emirates Securities and Commodities Authority, Central Bank and the Dubai Financial Services Authority, as applicable depending on your location in the United Arab Emirates, have not approved the Plan or the Agreement or taken steps to verify the information set out therein, and have no responsibility for such documents.

United Kingdom

Terms and Conditions

Responsibility for Taxes. This provision supplements Section 10 of the Agreement:

You agree that, if you do not pay or the Employer or the Company does not withhold from you the full amount of income tax that you owe at vesting, or the release or assignment of the RSUs for consideration, or the receipt of any other benefit in connection with the RSUs (the “Due Date”) within 90 days after the Due Date, or such other period specified in Section 222(1)(c) of the U.K. Income Tax (Earnings and Pensions) Act 2003, then the amount that should have been withheld shall constitute a loan owed by you to the Employer, effective 90 days after the Due Date. You agree that the loan will bear interest at the Her Majesty’s Revenue and Customs (“HMRC”) official rate and will be immediately due and repayable by you, and the Company and/or the Employer may recover it at any time thereafter by withholding the funds from salary, bonus or any other funds due to you by the Company or Employer, by withholding in shares issued at settlement or from the cash proceeds from the sale of shares or by demanding cash or a cheque from you. You also authorize the Company to delay the issuance of any shares unless and until the loan is repaid in full.

Notwithstanding the foregoing, if you are an executive officer or director (as within the meaning of Section 13(k) of the Exchange Act), the terms of the immediately foregoing provision will not apply. In the event that you are an executive officer or director and income tax is not collected from or paid by you within 90 days of the Due Date, the amount of any uncollected income tax may constitute a benefit to you on which additional income tax and National Insurance Contributions (“NICs”) (including Employer NICs, as defined below) may be payable. You acknowledge that the Company or the Employer may recover any such additional income tax and NICs (including Employer NICs, as defined below) at any time thereafter by any of the means referred to in Section 10 of the Agreement, although you acknowledge that you ultimately will be responsible for reporting any income tax or NICs (including Employer NICs, as defined below) due on this additional benefit directly to the HMRC under the self-assessment regime.

National Insurance Contributions Acknowledgment. As a condition of participation in the Plan and the vesting of the RSUs, you agree to accept any liability for secondary Class 1 NICs which may be payable by the Company and/or the Employer in connection with the RSUs and any event giving rise to Tax-Related Items (the “Employer NICs”). Without limitation to the foregoing, you agree to execute a joint election with the Company, the form of such joint election being formally approved by HMRC (the “Joint Election”), and any other required consent or election. You further agree to execute such other joint elections as may be required between you and any successor to the Company and/or the Employer. You further agree that the Company and/or the Employer may collect the Employer NICs from you by any of the means set forth in Section 10 of the Agreement.

GESDMS/6583294.3 10.

If you do not enter into a Joint Election prior to the vesting of the RSUs or if approval of the Joint Election has been withdrawn by HMRC, the RSUs shall become null and void without any liability to the Company and/or the Employer.

GESDMS/6583294.3 11.

EX-10.5

Exhibit 10.5

OMNICELL, INC.

PERFORMANCE CASH AWARD GRANT NOTICE

(2009 EQUITY INCENTIVE PLAN)

Omnicell, Inc. (the “Company”), pursuant to the Company’s 2009 Equity Incentive Plan (the “Plan”), hereby grants to Participant a Performance Cash Award for a Performance Cash Award as set forth below (the “Award”). This Award is subject to all of the terms and conditions as set forth herein and in the Management Equity Award Agreement (“Agreement”) and the Plan, each of which are attached hereto and incorporated herein in their entirety. Capitalized terms not explicitly defined in this Grant Notice but defined in the Plan shall have the same definitions as in the Plan. Except as otherwise expressly provided herein, in the event of any conflict between the terms in the Award and the Plan, the terms of the Plan shall control.

Participant:    

Date of Grant:    

Maximum Performance Cash Award Value:    

Vesting Schedule:  Subject to Participant’s continued services through December 31, 2012, this Award will vest as follows:

“Organic Goals” -- [$_________] will vest upon the Committee’s determination that the company revenue, excluding any revenue generated from acquisitions made during 2012 or 2013 (organic revenue), for 2013 is at least [$__________] and another [$__________] will vest upon the Committee’s determination that the company revenue, excluding any revenue generated from acquisitions made during 2012 or 2013 (organic revenue), for 2013 is at least [$____________]; provided that, in each case,the Company’s non-GAAP pro-forma operating margin remains at least 12% or greater at year-end 2013, excluding expenses associated with acquisitions.

“Inorganic Goals” -- In addition, [$__________] will vest upon the Committee’s determination that the Acquisition Run Rate Revenue is [$__________] or above by December 31, 2013. Acquisition Run Rate Revenue is calculated by summing the quotients derived by dividing the actual revenue generated from each acquisition completed during the year by the number of days that the Company owned the acquired entity and multiplying that sum by 365. If the acquisition run rate revenue is below [$_________], but acquisitions have been made that the Committee deems to be transformative to the company, [$________] will vest in the sole discretion of the Committee.

Payment Schedule: The Company shall pay Participant in settlement of a vested Performance Cash Award as provided in Section 4 of the Agreement.

Additional Terms/Acknowledgements: Participant acknowledges receipt of, and understands and agrees to, this Grant Notice, the Agreement and the Plan. Participant further acknowledges that as of the Date of Grant, this Grant Notice, the Agreement and the Plan set forth the entire understanding between Participant and the Company regarding the award of the Performance Cash Incentives and supersede all prior oral and written agreements on that subject with the exception of Awards previously granted and delivered to Participant under the Plan.

Participant shall provide written notification to the Company no later than thirty (30) days following Participant’s

receipt of this Grant Notice of any objection by Participant to the terms of the Award as set forth herein. Any such notification must be provided as set forth in Section 13 of the attached Agreement. Participant’s failure to provide such written notification within such thirty (30) day period shall constitute Participant’s affirmative agreement to all the terms of the Award as set forth in this Grant Notice, the Agreement and the Plan.

ATTACHMENTS: Performance Cash Award Agreement and 2009 Equity Incentive Plan

OMNICELL, INC.

2009 EQUITY INCENTIVE PLAN

PERFORMANCE CASH AWARD AGREEMENT

Pursuant to the Performance Cash Award Grant Notice (“Grant Notice”) and this Performance Cash Award Agreement (“Agreement”), Omnicell, Inc. (the “Company”) has granted you a Performance Cash Award pursuant to the Company’s 2009 Equity Incentive Plan (the “Plan”) for up to the Maximum Value of your Performance Cash Award as indicated in your Grant Notice (collectively, the “Award”). Capitalized terms not explicitly defined in this Agreement but defined in the Plan shall have the same definitions as in the Plan.

The details of your Award, in addition to those set forth in the Grant Notice, are as follows.

1.GRANT OF THE AWARD. Subject to adjustment and the terms and conditions as provided herein and in the Plan, your Performance Cash Award represents the opportunity to vest in and receive a cash payment equal to an amount up to the Maximum Performance Cash Award Value, as specified in your Grant Notice and determined on the applicable vesting date. This Award was granted in consideration of your services to the Company. Except as otherwise provided herein, you will not be required to make any payment to the Company (other than past and future services to the Company) with respect to your receipt of the Award, the vesting of the Performance Cash Incentives or the settlement of your Award.

2.VESTING. Subject to the limitations contained herein, the Performance Cash Incentives granted to you will vest as provided in the Vesting Schedule set forth in your Grant Notice, provided that vesting will cease upon the termination of your Continuous Status as an Employee.

3.SETTLEMENT OF PERFORMANCE CASH INCENTIVE. In settlement of the portion of your Performance Cash Award that vests, the Company shall pay you in cash an amount equal to the amount that vests pursuant to the terms of the vesting schedule, as determined on the applicable vesting date. The settlement of your vested Performance Cash Award shall occur at the next practicable payroll period following the Committee’s determination but not later than 60 days following the applicable vesting date and not later than December 31, 2014.

4.EXECUTION OF DOCUMENTS. You hereby acknowledge and agree that the manner selected by the Company by which you indicate your consent to your Grant Notice is also deemed to be your execution of your Grant Notice and of this Agreement. You further agree that such manner of indicating consent may be relied upon as your signature for establishing your execution of any documents to be executed in the future in connection with your Award.

5.TERMINATION OF CONTINUOUS SERVICE. Your Performance Cash Award shall automatically terminate and cease to remain outstanding immediately upon the cessation of your Continuous Service as an Employee. You shall have no further right to receive consideration pursuant to such cancelled Performance Cash Incentives.

6.NON-TRANSFERABILITY OF THE AWARD.. Your Award is not transferable, except by will or by the laws of descent and distribution. Notwithstanding the foregoing, by delivering written notice to the Company, in a form satisfactory to the Company, you may designate a third party who, in the event of your death, shall thereafter be entitled to receive any payment pursuant to this Agreement.

7.AWARD NOT A SERVICE CONTRACT. Your Award is not an employment or service contract,

and nothing in your Award shall be deemed to create in any way whatsoever any obligation on your part to continue in the service of the Company or any Affiliate, or on the part of the Company or any Affiliate to continue such service. In addition, nothing in your Award shall obligate the Company or any Affiliate, their respective members, boards of managers, managers, or employees to continue any relationship that you might have as an Employee of the Company or any Affiliate.

8.NO EQUITY OR OWNERSHIP INTEREST. The grant of the Award to you does not create or convey any equity or ownership interest in the Company nor any rights commonly associated with any such interest, including, but not limited to, the right to vote on any matters put before the Company’s stockholders. The Award and the Performance Cash Incentives subject to the Award do not constitute securities of the Company.

9.WITHHOLDING OBLIGATIONS.

(a)    On or before the time you receive a distribution pursuant to your Award, or at any time thereafter as requested by the Company, you hereby authorize any required withholding from the consideration issuable to you and otherwise agree to make adequate provision for any sums required to satisfy the federal, state, local and foreign tax withholding obligations of the Company or any Affiliate which arise in connection with your Award (the “Withholding Taxes”). The Company may satisfy all or any portion of the obligation for Withholding Taxes relating to your Award by withholding from any compensation otherwise payable to you by the Company, whether pursuant to your Award or otherwise. Unless the tax withholding obligations of the Company and/or any Affiliate are satisfied, the Company shall have no obligation to deliver to you any consideration pursuant to your Performance Cash Incentives.

(b)    In the event the Company’s obligation to withhold arises prior to the delivery to you of consideration pursuant to your Performance Cash Incentives or it is determined after the delivery of consideration to you that the amount of the Company’s withholding obligation was greater than the amount withheld by the Company, you agree to indemnify and hold the Company harmless from any failure by the Company to withhold the proper amount.

10.UNSECURED OBLIGATION. As of the Date of Grant specified in your Grant Notice, the Company will credit to a bookkeeping account maintained by the Company for your benefit, the Maximum Performance Cash Award Value subject to your Award. Your Award is unfunded, and even as to any portion of the Performance Cash Award which becomes vested, you shall be considered an unsecured creditor of the Company with respect to the Company’s obligation, if any, to issue any consideration pursuant to this Agreement. Nothing contained in this Agreement, and no action taken pursuant to its provisions, shall create or be construed to create a trust of any kind or a fiduciary relationship between you and the Company or any other person.

11.TAX CONSEQUENCES. You have reviewed with your own tax advisors the federal, state, local and foreign tax consequences of this investment and the transactions contemplated by this Agreement. You are relying solely on such advisors and not on any statements or representations of the Company or any of its agents. You understand that you (and not the Company) shall be responsible for your own tax liability that may arise as a result of your Award.

12.NOTICES. Any notice or request required or permitted hereunder shall be given in writing to each of the other parties hereto and shall be deemed effectively given on the earlier of (a) the date of personal delivery, including delivery by express courier, or (b) the date that is five days after deposit in the United States Post Office (whether or not actually received by the addressee), by registered or certified mail with postage and fees prepaid, addressed at the following addresses, or at such other address(es) as a party may designate by ten days’ advance written notice to each of the other parties hereto:

COMPANY:        Omnicell Inc.

[Address]

Attn: General Counsel

YOU:                Your address as on file with the Company’s

Human Resources Department at the time notice is given

Notwithstanding the foregoing, the Company may, in its sole discretion, decide to deliver any documents related to participation in the Plan and this Award by electronic means or to request your consent to participate in the Plan by electronic means. You hereby consent to receive such documents by electronic delivery and, if requested, to agree to participate in the Plan through an on-line or electronic system established and maintained by the Company or another third party designated by the Company.

13.MISCELLANEOUS.

(a)    The rights and obligations of the Company under your Award shall be transferable by the Company to any one or more persons or entities, and all covenants and agreements hereunder shall inure to the benefit of, and be enforceable by the Company’s successors and assigns.

(b)    You agree upon request to execute any further documents or instruments necessary or desirable in the sole determination of the Company to carry out the purposes or intent of your Award.

(c)    You acknowledge and agree that you have reviewed your Award in its entirety, have had an opportunity to obtain the advice of counsel prior to executing and accepting your Award and fully understand all provisions of your Award.

(d)    This Agreement shall be subject to all applicable laws, rules, and regulations, and to such approvals by any governmental agencies or national securities exchanges as may be required.

(e)    All obligations of the Company under the Plan and this Agreement shall be binding on any successor to the Company, whether the existence of such successor is the result of a direct or indirect purchase, merger, consolidation, or otherwise, of all or substantially all of the business and/or assets of the Company.

14.HEADINGS. The headings of the Sections in this Agreement are inserted for convenience only and shall not be deemed to constitute a part of this Agreement or to affect the meaning of this Agreement.

15.GOVERNING PLAN DOCUMENTS. Your Award is subject to all the provisions of the Plan, the provisions of which are hereby made a part of your Award, and is further subject to all interpretations, amendments, rules and regulations which may from time to time be promulgated and adopted pursuant to the Plan. Except as otherwise expressly provided herein in the event of any conflict between the terms in the Award and the Plan, the terms of the Plan shall control.

16.SEVERABILITY. If all or any part of this Agreement or the Plan is declared by any court or governmental authority to be unlawful or invalid, such unlawfulness or invalidity shall not invalidate any portion of this Agreement or the Plan not declared to be unlawful or invalid. Any Section of this Agreement (or part of such a Section) so declared to be unlawful or invalid shall, if possible, be construed in a manner which will give effect to the terms of such Section or part of a Section to the fullest extent possible while remaining lawful and valid.

17.CHOICE OF LAW. The interpretation, performance and enforcement of this Agreement will be governed by the law of the state of California without regard to such state’s conflicts of laws rules.

18.AMENDMENT. This Agreement may not be modified, amended or terminated except by an instrument in writing, signed by you and by a duly authorized representative of the Company. Notwithstanding the foregoing, this Agreement may be amended solely by the Committee by a writing which specifically states that it is amending this Agreement, so long as a copy of such amendment is delivered to you, and provided that, except as provided in the next sentence, no such amendment adversely affecting your rights hereunder may be made without your written consent. The Committee reserves the right to change, by written notice to you, the provisions of this Agreement in any way it may deem necessary or advisable to carry out the purpose of the grant pursuant to Section 8(j) of the Plan or as a result of any change in applicable laws or regulations or any future law, regulation, ruling, or judicial decision, provided that any such change shall be applicable only to rights relating to that portion of the Award which is then subject to restrictions as provided herein.

.

* * * * *

EX-10.6

EX-10.7

EX-10.8

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12: 26:39 PM john.brottem@ omnicell.com RAZORB LADE CONFIDE NTIAL

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26 : 39 P M john.brottem@omnicell . co m RAZORBLA D ECONFIDENTI A L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26 : 39 P M john.brottem@omnicell . co m RAZORBLA D ECONFIDENTI A L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26 : 39 P M john.brottem@omnicell . co m RAZORBLA D ECONFIDENTI A L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26 : 39 P M john.brottem@omnicell . co m RAZORBLA D ECONFIDENTI A L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26 : 39 P M john.brottem@omnicell . co m RAZORBLA D ECONFIDENTI A L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

07/24/2012 12:26:39 P M john.brottem@omnicell.co m RAZORBLAD E CONFIDENTIA L

EX-31.1

Exhibit 31.1

CERTIFICATION

I, Randall A. Lipps, certify that:

1.I have reviewed this quarterly report on Form 10-Q of Omnicell, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; 

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 9, 2012
	/s/ Randall A. Lipps
	Randall A. Lipps
	President and Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION

I, Robin G. Seim, certify that:

1.I have reviewed this quarterly report on Form 10-Q of Omnicell, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 9, 2012
	/s/ Robin G. Seim
	Robin G. Seim
	Chief Financial Officer and Vice President Finance, Administration and Manufacturing

EX-32.1

Exhibit 32.1

CERTIFICATION

Pursuant to the requirement set forth in Rule 13a-14(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C. §1350), Randall A. Lipps, the President and Chief Executive Officer of Omnicell, Inc. (the “Company”) and Robin G. Seim, the Chief Financial Officer of the Company, each hereby certifies that, to the best of his knowledge:

1.The Company’s Quarterly Report on Form 10-Q for the period ended June 30, 2012, to which this Certification is attached as Exhibit 32.1 fully complies with the requirements of Section 13(a) or Section 15(d) of the Exchange Act; and

2.The information contained in this Quarterly Report on Form 10-Q fairly presents, in all material respects, the financial condition and results of operations the Company.

In Witness Whereof, the undersigned have set their hands hereto as of the 9th day of August, 2012.

/s/ Randall A. Lipps	/s/ Robin G. Seim
Randall A. Lipps	Robin G. Seim
President and Chief Executive Officer	Chief Financial Officer and Vice President Finance, Administration and Manufacturing

This certification accompanies the Form 10-Q to which it relates, is not deemed filed with the Securities and Exchange Commission and is not to be incorporated by reference into any filing of Omnicell, Inc. under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended (whether made before or after the date of the Form 10-Q), irrespective of any general incorporation language contained in such filing.

XML

Organization and Summary of Significant Accounting Policies Shipping and handling costs (Details) (Shipping, Handling and Transportation Costs [Member], USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Shipping, Handling and Transportation Costs [Member]
Component of Operating Other Cost and Expense [Line Items]
Other Cost and Expense, Operating	$ 0.8	$ 0.8	$ 1.5	$ 1.4

XML

Goodwill and Other Intangible Assets Future amortizaion of intangibles (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011
Goodwill and Intangible Assets Disclosure [Abstract]
2012 (remaining six months)	$ 2,124
2013	4,235
2014	4,195
2015	4,172
2016	3,821
2017	3,786
Thereafter	64,909
Finite-Lived Intangible Assets, Net	$ 87,242	$ 4,231	[1]

[1] Information derived from our December 31, 2011 audited Consolidated Financial Statements.

XML

Net Investment in Sales-Type Leases (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012
Net Investment in Sales-Type Leases [Abstract]
2012 (remaining six months)	$ 2,559
2013	4,601
2014	3,512
2015	2,516
2016	1,573
2017	567
Thereafter	0
Total	$ 15,328

XML

Business Acquisition (Details) (USD $)	May 20, 2012
Business Acquisition [Line Items]
Cash including restricted cash	$ 2,000,000
Business Combination, Acquired Receivables, Fair Value	7,403,000
Business Acquisition, Purchase Price Allocation, Current Assets, Inventory	11,726,000
Business Acquisition, Purchase Price Allocation, Current Assets, Prepaid Expense and Other Assets	2,864,000
Business Acquisition, Purchase Price Allocation, Current Assets	23,993,000
Business Acquisition, Purchase Price Allocation, Property, Plant and Equipment	11,088,000
Business Acquisition, Purchase Price Allocation, Intangible Assets Other than Goodwill	83,500,000
Business Acquisition, Purchase Price Allocation, Goodwill Amount	84,491,000
Business Acquisition, Purchase Price Allocation, Other Noncurrent Assets	244,000
Business Acquisition, Purchase Price Allocation, Assets Acquired	203,316,000
Business Acquisition, Purchase Price Allocation, Current Liabilities	(8,046,000)
Business Acquisition, Purchase Price Allocation, Deferred Tax Liabilities, Noncurrent	(33,898,000)
Business Acquisition, Purchase Price Allocation, Noncurrent Liabilities	(1,227,000)
Business Acquisition, Purchase Price Allocation, Assets Acquired (Liabilities Assumed), Net	160,145,000
Business Combination, Consideration Transferred	160,145,000
Business Combination, Acquired Receivables, Gross Contractual Amount	7,600,000
Business Acquisitions Receivablesnot expected collectible	(225,000)
MTS-Medication Technologies [Member]
Business Acquisition [Line Items]
business acquisition sellers escrow account	13,500,000
Business acquisition cash paid at closing	158,300,000
Business Acquisition Final adjustment amount, estimated	1,800,000
Business Combination, Consideration Transferred	$ 160,145,000

XML

Goodwill and Other Intangible Assets Indefinite Life Intangibles by class (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011
Goodwill and Intangible Assets Disclosure [Abstract]
Indefinite-Lived Intangible Assets (Excluding Goodwill)	$ 0	$ 0

XML

Property and Equipment (Details) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011	Dec. 31, 2011
Property, Plant and Equipment [Line Items]
Property and Equipment, Gross	$ 65,429,000		$ 65,429,000		$ 53,528,000
Accumulated Depreciation	(36,464,000)		(36,464,000)		(36,222,000)
Property and equipment, net	28,965,000		28,965,000		17,306,000	[1]
Depreciation expense	1,900,000	1,400,000	3,500,000	2,800,000
Equipment [Member]
Property, Plant and Equipment [Line Items]
Property and Equipment, Gross	35,322,000		35,322,000		25,101,000
Furniture and Fixtures [Member]
Property, Plant and Equipment [Line Items]
Property and Equipment, Gross	2,256,000		2,256,000		1,811,000
Leasehold Improvements [Member]
Property, Plant and Equipment [Line Items]
Property and Equipment, Gross	4,196,000		4,196,000		3,692,000
Software [Member]
Property, Plant and Equipment [Line Items]
Property and Equipment, Gross	21,264,000		21,264,000		20,641,000
Construction in Progress [Member]
Property, Plant and Equipment [Line Items]
Property and Equipment, Gross	$ 2,391,000		$ 2,391,000		$ 2,283,000

[1] Information derived from our December 31, 2011 audited Consolidated Financial Statements.

XML

Commitments (Tables)

6 Months Ended

Jun. 30, 2012

Commitments [Abstract]

Schedule of Future Minimum Rental Payments for Operating Leases [Table Text Block]

At June 30, 2012, the minimum payments under our operating leases for each of the five succeeding fiscal years are as follows (in thousands):

2012 (remaining six months)	$	2,978
2013	5,154
2014	5,272
2015	5,183
2016	4,898
2017	4,206
Thereafter	20,430
Total	$	48,121

XML

Business Acquisition Consol Pro Forma operating results assuming begin of prior year as acq date (Details) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Business Acquisition [Line Items]
Revenues	$ 75,384,000	$ 61,005,000	$ 139,527,000	$ 118,165,000
Net income	1,375,000	2,587,000	3,726,000	3,257,000
Pro Forma [Member] | MTS-Medication Technologies [Member]
Business Acquisition [Line Items]
Revenues	85,204,000	80,798,000	168,270,000	157,247,000
Net income	$ 4,110,000	$ 3,874,000	$ 6,595,000	$ 6,056,000

XML

Deferred Gross Profit (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011
Deferred Gross Profit[Abstract]
Sales of Medication and supply dispensing systems and packaging equipment, which have been delivered and invoiced but not yet installed	$ 23,463	$ 24,181
Cost of revenues, excluding installation costs	(8,985)	(9,971)
Deferred gross profit	$ 14,478	$ 14,210	[1]

[1] Information derived from our December 31, 2011 audited Consolidated Financial Statements.

XML

Subsequent Event (Details) (USD $)	3 Months Ended			6 Months Ended		53 Months Ended	1 Months Ended	6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Mar. 31, 2011	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Aug. 08, 2012 Subsequent Event [Member]	Jun. 30, 2012 Subsequent Event [Member]
Subsequent Event [Line Items]
Stock Repurchase Program, Authorized Amount				$ 90,000,000
Treasury Stock, Shares, Acquired	505,137	218,075	0		559,175		314,100
Treasury Stock Acquired, Average Cost Per Share	$ 13.98	$ 15.00			$ 14.31	$ 15.51	$ 13.39
Share Repurchase - remaining funds authorized	5,300,000			5,300,000		5,300,000	1,096,000
New Share Repurchase Program								$ 50,000,000

XML

Business Acquisition Bus acquisition - Table of acquired Intangibles (Details) (USD $) In Thousands, unless otherwise specified	53 Months Ended				6 Months Ended
	Jun. 30, 2012	Jun. 30, 2012 Trade Names [Member]	Jun. 30, 2012 Customer Relationships [Member]	Jun. 30, 2012 acquired technology [Member]	Jun. 30, 2012 MTS-Medication Technologies [Member]	Jun. 30, 2012 MTS-Medication Technologies [Member] Trade Names [Member]	Jun. 30, 2012 MTS-Medication Technologies [Member] acquired technology [Member]	Jun. 30, 2012 Minimum [Member] Trade Names [Member]	Jun. 30, 2012 Minimum [Member] Customer Relationships [Member]	Jun. 30, 2012 Minimum [Member] acquired technology [Member]	Jun. 30, 2012 Minimum [Member] MTS-Medication Technologies [Member]	Jun. 30, 2012 Minimum [Member] MTS-Medication Technologies [Member] Customer Relationships [Member]	Jun. 30, 2012 Maximum [Member] Trade Names [Member]	Jun. 30, 2012 Maximum [Member] Customer Relationships [Member]	Jun. 30, 2012 Maximum [Member] acquired technology [Member]	Jun. 30, 2012 Maximum [Member] MTS-Medication Technologies [Member]	Jun. 30, 2012 Maximum [Member] MTS-Medication Technologies [Member] Customer Relationships [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Asset, Useful Life					25 years 1 month 10 days	12 years	20 years	3 years	5 years	3 years	12 years	28 years	12 years	30 years	20 years	30 years	30 years
Acquired Finite-lived Intangible Asset, Amount	$ 83,500	$ 6,800	$ 50,100	$ 26,600
Expected amortization of acquired intangibles first year	$ 3,590	$ 567	$ 1,693	$ 1,330

XML

Net Income Per Share (Tables)

6 Months Ended

Jun. 30, 2012

Net Income Per Share [Abstract]

Schedule of Earnings Per Share, Basic and Diluted [Table Text Block]

The calculation of basic and diluted net income per share is as follows (in thousands, except per share amounts):

	Three Months Ended June 30,				Six Months Ended June 30,
	2012		2011		2012		2011
Basic:
Net income	$	1,375	$	2,587	$	3,726	$	3,257
Weighted average shares outstanding — basic	33,390		33,003		33,377		33,093
Net income per share — basic	$	0.04	$	0.08	$	0.11	$	0.10
Diluted:
Net income	$	1,375	$	2,587	$	3,726	$	3,257
Weighted average shares outstanding — basic	33,390		33,003		33,377		33,093
Add: Dilutive effect of employee stock plans	926		978		952		946
Weighted average shares outstanding — diluted	34,316		33,981		34,329		34,039
Net income per share — diluted	$	0.04	$	0.08	$	0.11	$	0.10

XML

Net Investment in Sales-Type Leases allowance credit loss rollforward (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Allowance for credit losses, beginning of period	$ 257	$ 380	$ 284	$ 411
Current period provision (reversal)	422	(5)	422	(9)
Direct write-downs charged against the allowance	0	0	0	0
Recoveries of amounts previously charged off	(20)	(22)	(47)	(49)
Allowance for credit losses, end of period	$ 659	$ 353	$ 659	$ 353

XML

Net Income Per Share (Details) (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Net Income Per Share [Abstract]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount			2,103,021	2,085,850
Earnings Per Share, Basic [Abstract]
Net income	$ 1,375	$ 2,587	$ 3,726	$ 3,257
Weighted Average Number of Shares Outstanding, Basic	33,390,000	33,003,000	33,377,000	33,093,000
Net income per share-basic	$ 0.04	$ 0.08	$ 0.11	$ 0.10
Earnings Per Share, Diluted [Abstract]
Weighted Average Number of Shares Outstanding, Basic	33,390,000	33,003,000	33,377,000	33,093,000
Dilutive Effect of Employee Stock Plans	$ 926	$ 978	$ 952	$ 946
Weighted Average Number of Shares Outstanding, Diluted	34,316,000	33,981,000	34,329,000	34,039,000
Net income per share - diluted	$ 0.04	$ 0.08	$ 0.11	$ 0.10

XML

Segments (Details) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Segment Reporting Information [Line Items]
Revenues	$ 75,384,000	$ 61,005,000	$ 139,527,000	$ 118,165,000
Cost of Revenue	36,008,000	27,198,000	64,402,000	52,708,000
Gross profit	39,376,000	33,807,000	75,125,000	65,457,000
Gross Margin Percentage	52.20%	55.40%	53.80%	55.40%
Operating Expenses	36,945,000	29,577,000	69,059,000	60,198,000
Income from operations	2,431,000	4,230,000	6,066,000	5,259,000
Operating margin percentage	3.20%	6.90%	4.30%	4.50%
Interest and other income (expense), net	(73,000)	71,000	23,000	125,000
Income before provision for income taxes	2,358,000	4,301,000	6,089,000	5,384,000
Provision for income taxes	983,000	1,714,000	2,363,000	2,127,000
Net income	1,375,000	2,587,000	3,726,000	3,257,000
Acute Care Solutions [Member]
Segment Reporting Information [Line Items]
Revenues	66,528,000	61,005,000	130,671,000	118,165,000
Cost of Revenue	29,158,000	27,198,000	57,552,000	52,708,000
Gross profit	37,370,000	33,807,000	73,119,000	65,457,000
Gross Margin Percentage	56.20%	55.40%	56.00%	55.40%
Operating Expenses	33,458,000	29,577,000	65,572,000	60,198,000
Income from operations	3,912,000	4,230,000	7,547,000	5,259,000
Operating margin percentage	5.90%	6.90%	5.80%	4.50%
Non-acute care solutions [Member]
Segment Reporting Information [Line Items]
Revenues			8,856,000
Cost of Revenue	6,850,000		6,850,000
Gross profit	2,006,000		2,006,000
Gross Margin Percentage	22.70%		22.70%
Operating Expenses	3,487,000		3,487,000
Income from operations	(1,481,000)		(1,481,000)
Operating margin percentage	(16.70%)		(16.70%)
MTS-Medication Technologies [Member] | Non-acute care solutions [Member]
Segment Reporting Information [Line Items]
Revenues			8,856,000
Net income			(1,524,000)
COS relief of FV inventory step-up and misc [Member] | MTS-Medication Technologies [Member] | Non-acute care solutions [Member]
Segment Reporting Information [Line Items]
Cost of Revenue	1,650,184		1,650,184
Acq trransaction costs [Member] | MTS-Medication Technologies [Member] | Acute Care Solutions [Member]
Segment Reporting Information [Line Items]
Operating Expenses	2,342,780		2,342,780
Severance and misc cost [Member] | MTS-Medication Technologies [Member] | Non-acute care solutions [Member]
Segment Reporting Information [Line Items]
Operating Expenses	$ 861,828		$ 861,828

XML

Organization and Summary of Significant Accounting Policies Lease Transfers to 3rd party lessors during period (Details) (Lease Agreements [Member], USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011	Dec. 31, 2011
Lease Agreements [Member]
Third Party Lease Transfers [Line Items]
Cash Flows Between Transferor and Transferee, Proceeds from New Transfers	$ 15.7	$ 12.2	$ 27.8	$ 23.2
Lease transfers in ending A/R	$ 0.7		$ 0.7		$ 0.2

XML

Goodwill and Other Intangible Assets Finite life intangibles Gross and Net at balance sheet dates (Details) (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2012	Dec. 31, 2011
Acquired Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Assets, Gross	$ 89,998	$ 6,249
Finite-Lived Intangible Assets, Accumulated Amortization	2,756	2,018
Finite-Lived Intangible Assets, Net	87,242	4,231	[1]
Customer Relationships [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Assets, Gross	54,330	4,230
Finite-Lived Intangible Assets, Accumulated Amortization	2,003	1,591
Finite-Lived Intangible Assets, Net	52,327	2,639
acquired technology [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Assets, Gross	27,580	980
Finite-Lived Intangible Assets, Accumulated Amortization	393	175
Finite-Lived Intangible Assets, Net	27,187	805
Patents [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Assets, Gross	1,138	889
Finite-Lived Intangible Assets, Accumulated Amortization	210	190
Finite-Lived Intangible Assets, Net	928	699
Finite-Lived Intangible Asset, Useful Life	20 years
Trade Names [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Assets, Gross	6,890	90
Finite-Lived Intangible Assets, Accumulated Amortization	115	37
Finite-Lived Intangible Assets, Net	6,775	53
Noncompete Agreements [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Assets, Gross	60	60
Finite-Lived Intangible Assets, Accumulated Amortization	35	25
Finite-Lived Intangible Assets, Net	$ 25	$ 35
Finite-Lived Intangible Asset, Useful Life	3 years
Minimum [Member] | Customer Relationships [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Asset, Useful Life	5 years
Minimum [Member] | acquired technology [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Asset, Useful Life	3 years
Minimum [Member] | Trade Names [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Asset, Useful Life	3 years
Maximum [Member] | Customer Relationships [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Asset, Useful Life	30 years
Maximum [Member] | acquired technology [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Asset, Useful Life	20 years
Maximum [Member] | Trade Names [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Asset, Useful Life	12 years

[1] Information derived from our December 31, 2011 audited Consolidated Financial Statements.

XML

Stock Option Plans and Share-Based Compensation PSU performance to vesting table by Program year (Details) (Performance Shares [Member])	6 Months Ended
	Jun. 30, 2011 PSU Program Year Two [Member]	Jun. 30, 2011 PSU program year one [Member]	Jun. 30, 2012 Below the 35th percentile ranking [Member] PSU Program Year Two [Member]	Jun. 30, 2012 Below the 35th percentile ranking [Member] PSU program year one [Member]	Jun. 30, 2012 Below 50th percentile ranking [Member] PSU Program Year Two [Member]	Jun. 30, 2012 Below 50th percentile ranking [Member] PSU program year one [Member]	Jun. 30, 2012 Below the 65th percentile ranking [Member] PSU program year one [Member]	Jun. 30, 2012 At least 50th percentile (after yr one) [Member] PSU Program Year Two [Member]	Jun. 30, 2012 At or above the 75th percentile ranking [Member] PSU program year one [Member]	Jun. 30, 2012 Minimum [Member] Below the 75th percentile ranking [Member] PSU program year one [Member]	Jun. 30, 2012 Maximum [Member] Below the 75th percentile ranking [Member] PSU program year one [Member]	Jun. 30, 2012 Begin Point [Member]	Jun. 30, 2012 End point [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentile ranking of 2011 shareholder return		76.30%
Trading days considered in shareholder return calc												20 days	20 days
PSU percentage eligible fopr time-based vesting			0.00%	0.00%	50.00%	50.00%	100.00%	100.00%	120.00%	110.00%	119.00%
PSU percentage eligible for vesting based on actual return		120.00%
PSU shares eligible for vesting based on actual shareholder return		120,000
Share-based Compensation Arrangement by Share-based payment Award, Percent Vested in First Year	0.00%	0.00%
Period for remaining award to vest semi-annually	36 months	36 months

XML

Commitments Fin 48 uncertain tax positions in commitments discussion (Details) (USD $) In Millions, unless otherwise specified	Jun. 30, 2012
Commitments [Abstract]
Liability for Uncertain Tax Positions, Noncurrent	$ 3.0

XML

Net Investment in Sales-Type Leases sales type lease - from min payments to non current investment (Details) (USD $)	Jun. 30, 2012	Dec. 31, 2011
Net Investment in Sales-Type Leases [Abstract]
Net minimum lease payments to be received	$ 15,328,000	$ 15,063,000
Less unearned interest income portion	1,113,000	1,229,000
Net investment in sales-type leases	14,215,000	13,834,000
Less current portion	4,389,000	5,049,000
Non-current net investment in sales-type leases	9,826,000	8,785,000	[1]
Allowance for doubtful accounts (Notes), Current	500,000	100,000
Allowance for doubtful accounts (Notes), Non-current	$ 100,000	$ 100,000

[1] Information derived from our December 31, 2011 audited Consolidated Financial Statements.

XML

Cash and Cash Equivalents, Short-term Investments and Fair Value of Financial Instruments

6 Months Ended

Jun. 30, 2012

Cash and Cash Equivalents [Abstract]

Cash and Cash Equivalents, Short-term Investments and Fair Value of Financial Instruments

Cash and Cash Equivalents, Short-term Investments and Fair Value of Financial Instruments

Cash and cash equivalents and short-term investments consist of the following significant investment asset classes, with disclosure of amortized cost, gross unrealized gains and losses, and fair value as of June 30, 2012 and December 31, 2011 (in thousands):

	June 30, 2012
	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value		Cash / Cash Equivalents		Short-term Investments		Security Classification (1)
Cash	$	20,443	$	—	$	—	$	20,443	$	20,443	$	—	N/A
Money market funds	33,628		—		—		33,628		33,628		—		Available for sale
Total cash, cash equivalents and short-term investments	$	54,071	$	—	$	—	$	54,071	$	54,071	$	—

	December 31, 2011
	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value		Cash / Cash Equivalents		Short-term Investments		Security Classification
Cash	$	14,452	$	—	$	—	$	14,452	$	14,452	$	—	N/A
Money market funds	177,310		—		—		177,310		177,310		—		Available for sale
Non-U.S. government securities	8,106		1		—		8,107		—		8,107		Available for sale
Total cash, cash equivalents and short-term investments	$	199,868	$	1	$	—	$	199,869	$	191,762	$	8,107

The money market fund is a daily-traded cash equivalent with the price of $1.00, making it a Level 1 asset class, and its carrying cost closely approximates fair value. As demand deposit (cash) balances vary with the timing of collections and payments, the money market fund can cover any surplus or deficit, and thus is considered Available-for-sale.

The short term investments purchased in September 2011 were comprised of California revenue anticipation notes, which matured in June 2012. As this is the initial investment in a broader portfolio strategy for yield management, these are considered Available-for-sale. The notes were considered a Level 2 asset class, because their pricing is drawn from multiple market-related inputs, but in general not from same-day, same-security trades.

The following table displays the financial assets measured at fair value, on a recurring basis, with money market funds recorded within cash and cash equivalents and non-U.S Government securities in short-term investments (in thousands):

	Quoted Prices in Active Markets for Identical Instruments (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)	Total Fair Value
At June 30, 2012
Money market funds	$	33,628	$	—	—	$	33,628
Total	$	33,628	$	—	—	$	33,628
At December 31, 2011
Money market funds	$	177,310	—		—	$	177,310
Non U.S. Government securities	—		$	8,107	—	8,107
Total	$	177,310	$	8,107	—	$	185,417

Current assets and current liabilities are recorded at amortized cost, which approximates fair value due to the short-term maturities implied.

XML

Contingencies (Details)	6 Months Ended
	Jun. 30, 2012
Product Liability Contingency [Line Items]
Net Amount at Risk by Product and Guarantee, Weighted Average Period Remaining	30 days
Medication Packaging Systems [Member]
Product Liability Contingency [Line Items]
Net Amount at Risk by Product and Guarantee, Weighted Average Period Remaining	6 months

XML

Cash and Cash Equivalents, Short-term Investments and Fair Value of Financial Instruments (Details) avail for sasle securities levels 1-2-3 table (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011
Cash and Cash Equivalents [Line Items]
Cash, Cash Equivalents, and Short-term Investments	$ 54,071	$ 199,869
Fair Value, Measurements, Recurring [Member]
Cash and Cash Equivalents [Line Items]
Cash, Cash Equivalents, and Short-term Investments	33,628	185,417
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member]
Cash and Cash Equivalents [Line Items]
Cash, Cash Equivalents, and Short-term Investments	33,628	177,310
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member]
Cash and Cash Equivalents [Line Items]
Cash, Cash Equivalents, and Short-term Investments	0	8,107
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member]
Cash and Cash Equivalents [Line Items]
Cash, Cash Equivalents, and Short-term Investments	0	0
Money Market Funds [Member]
Cash and Cash Equivalents [Line Items]
Cash and Cash Equivalents, Fair Value Disclosure	33,628	177,310
Money Market Funds [Member] | Fair Value, Measurements, Recurring [Member]
Cash and Cash Equivalents [Line Items]
Cash and Cash Equivalents, Fair Value Disclosure	33,628	177,310
Money Market Funds [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member]
Cash and Cash Equivalents [Line Items]
Cash and Cash Equivalents, Fair Value Disclosure	33,628	177,310
Money Market Funds [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member]
Cash and Cash Equivalents [Line Items]
Cash and Cash Equivalents, Fair Value Disclosure	0	0
Money Market Funds [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member]
Cash and Cash Equivalents [Line Items]
Cash and Cash Equivalents, Fair Value Disclosure	0	0
US States and Political Subdivisions Debt Securities [Member]
Cash and Cash Equivalents [Line Items]
A-F-S, Fair Value Disclosure		8,107
US States and Political Subdivisions Debt Securities [Member] | Fair Value, Measurements, Recurring [Member]
Cash and Cash Equivalents [Line Items]
A-F-S, Fair Value Disclosure		8,107
US States and Political Subdivisions Debt Securities [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member]
Cash and Cash Equivalents [Line Items]
A-F-S, Fair Value Disclosure		0
US States and Political Subdivisions Debt Securities [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member]
Cash and Cash Equivalents [Line Items]
A-F-S, Fair Value Disclosure		8,107
US States and Political Subdivisions Debt Securities [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member]
Cash and Cash Equivalents [Line Items]
A-F-S, Fair Value Disclosure		$ 0

XML

Net Investment in Sales-Type Leases (Tables)

6 Months Ended

Jun. 30, 2012

Capital Leases, Net Investment in Sales Type Leases [Abstract]

sales type lease investment [Table Text Block]

Our sales-type leases are for terms generally ranging up to five years. Sales-type lease receivables are collateralized by the underlying equipment. The components of our net investment in sales-type leases are as follows (in thousands):

	June 30, 2012		December 31, 2011
Net minimum lease payments to be received	$	15,328	$	15,063
Less unearned interest income portion	1,113		1,229
Net investment in sales-type leases	14,215		13,834
Less current portion(1)	4,389		5,049
Non-current net investment in sales-type leases(2)	$	9,826	$	8,785

Schedule of Future Minimum Lease Payments for Capital Leases [Table Text Block]

The minimum lease payments under sales-type leases as of June 30, 2012 were as follows (in thousands):

2012 (remaining six months)	$	2,559
2013	4,601
2014	3,512
2015	2,516
2016	1,573
2017	567
Thereafter	—
Total	$	15,328

Allowance for Credit Losses on Financing Receivables [Table Text Block]

The following table summarizes the credit losses and recorded investment in sales-type leases, excluding unearned interest, as of June 30, 2012 and December 31, 2011 (in thousands):

	Allowance for Credit Losses		Recorded Investment in Sales-type Leases Gross		Recorded Investment in Sales-type Leases Net
Credit loss disclosure for June 30, 2012 :
Accounts individually evaluated for impairment	$	544	$	544	$	—
Accounts collectively evaluated for impairment	115		14,330		14,215
Ending balances: June 30, 2012	$	659	$	14,874	$	14,215
Credit loss disclosure for December 31, 2011 :
Accounts individually evaluated for impairment	$	178	$	178	$	—
Accounts collectively evaluated for impairment	106		13,940		13,834
Ending balances: December 31, 2011	$	284	$	14,118	$	13,834

Schedule of Credit Losses Related to Financing Receivables, Noncurrent [Table Text Block]

The following table summarizes the activity for the allowance for credit losses for the investment in sales-type leases for the three months and six months ended June 30, 2012 and 2011 (in thousands):

	Three Months Ended June 30,						Six Months Ended June 30,
	2012			2011			2012			2011
Allowance for credit losses, beginning of period	$	257		$	380		$	284		$	411
Current period provision (reversal)	422			(5		)	422			(9		)
Direct write-downs charged against the allowance	—			—			—			—
Recoveries of amounts previously charged off	(20		)	(22		)	(47		)	(49		)
Allowance for credit losses, end of period	$	659		$	353		$	659		$	353

XML

Property and Equipment (Tables)

6 Months Ended

Jun. 30, 2012

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment [Table Text Block]

Property and equipment consist of the following (in thousands):

	June 30, 2012			December 31, 2011
Equipment	$	35,322		$	25,101
Furniture and fixtures	2,256			1,811
Leasehold improvements	4,196			3,692
Purchased software	21,264			20,641
Capital in process	2,391			2,283
	65,429			53,528
Accumulated depreciation and amortization	(36,464		)	(36,222		)
Property and equipment, net	$	28,965		$	17,306

XML

Accrued Liabilities (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011
Accrued Liabilities, Current [Abstract]
Advance payments from customers	$ 2,805	$ 3,390
Accrued Group Purchasing Organization (GPO) fees	2,055	2,437
Acquisition consideration payable	1,833	0
Rebates and lease buyouts	1,125	1,748
Taxes payable	527	925
Other	1,611	401
Total	$ 9,956	$ 8,901	[1]

[1] Information derived from our December 31, 2011 audited Consolidated Financial Statements.

XML

Cash and Cash Equivalents, Short-term Investments and Fair Value of Financial Instruments marketable securities - gain or loss (Details) (USD $)	53 Months Ended
	Jun. 30, 2012	Dec. 31, 2011		Jun. 30, 2011	Dec. 31, 2010
Schedule of Available-for-sale Securities [Line Items]
Money Market Fund - daily traded value	$ 1.00
Cash and cash equivalents, Amortized Cost	54,071,000	191,762,000	[1]	181,258,000	175,635,000
Cash, cash equiv and S-T-I: Amortized cost	54,071,000	199,868,000
Cash, cash equiv and S-T-I: Gross unrealized gains	0	1,000
Cash, cash equiv and S-T-I: Gross unrealized losses	0	0
Cash, Cash Equivalents, and Short-term Investments	54,071,000	199,869,000
Cash [Member]
Schedule of Available-for-sale Securities [Line Items]
Cash and cash equivalents, Amortized Cost	20,443,000	14,452,000
Cash and cash equivalents - gross unrealized gain	0	0
Cash and cash equivalents - Gross unrealized losses	0	0
Cash and Cash Equivalents, Fair Value Disclosure	20,443,000	14,452,000
Money Market Funds [Member]
Schedule of Available-for-sale Securities [Line Items]
Cash and cash equivalents, Amortized Cost	33,628,000	177,310,000
Cash and cash equivalents - gross unrealized gain	0	0
Cash and cash equivalents - Gross unrealized losses	0	0
Cash and Cash Equivalents, Fair Value Disclosure	33,628,000	177,310,000
US States and Political Subdivisions Debt Securities [Member]
Schedule of Available-for-sale Securities [Line Items]
A-F-S Securities, Amortized Cost Basis		8,106,000
A-F-S Securities, Gross Unrealized Gains		1,000
A-F-S Securities, Gross Unrealized Losses		0
A-F-S, Fair Value Disclosure		8,107,000
Cash and Cash Equivalents [Member]
Schedule of Available-for-sale Securities [Line Items]
Cash, Cash Equivalents, and Short-term Investments	54,071,000	191,762,000
Cash and Cash Equivalents [Member] | Cash [Member]
Schedule of Available-for-sale Securities [Line Items]
Cash and Cash Equivalents, Fair Value Disclosure	20,443,000	14,452,000
Cash and Cash Equivalents [Member] | Money Market Funds [Member]
Schedule of Available-for-sale Securities [Line Items]
Cash and Cash Equivalents, Fair Value Disclosure	33,628,000	177,310,000
Short-term Investments [Member]
Schedule of Available-for-sale Securities [Line Items]
Cash, Cash Equivalents, and Short-term Investments	0	8,107,000
Short-term Investments [Member] | US States and Political Subdivisions Debt Securities [Member]
Schedule of Available-for-sale Securities [Line Items]
A-F-S, Fair Value Disclosure		$ 8,107,000

[1] Information derived from our December 31, 2011 audited Consolidated Financial Statements.

XML

Goodwill and Other Intangible Assets (Tables)

6 Months Ended

Jun. 30, 2012

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Goodwill [Table Text Block]

Activity in Goodwill by reporting units, which are the same as our operating segments, for the six months ended June 30, 2012 consists of the following (in thousands):

	Goodwill at December 31, 2011		Goodwill acquired		Other adjustments		Goodwill at June 30, 2012
Reporting units:
Acute Care	$	28,543	$	—	$	—	$	28,543
Non-Acute Care	—		84,491		—		84,491
Total	$	28,543	$	84,491	$	—	$	113,034

The goodwill acquired reflects the May 21, 2012 acquisition of MedPak by Omnicell. MedPak is the parent company of MTS, a worldwide provider of medication adherence packaging systems. The acquired goodwill was assigned to the new reporting unit called Non-Acute Care, created as a result of the MTS acquisition.

There were no indefin

Schedule of Intangible Assets and Goodwill [Table Text Block]

There were no indefinite-life intangibles at either June 30, 2012 or December 31, 2011. Other finite-life intangible assets at these dates consist of the following (in thousands):

	June 30, 2012						December 31, 2011
	Gross				Net		Gross				Net
	Carrying Amount		Accumulated Amortization		Carrying Amount		Carrying Amount		Accumulated Amortization		Carrying Amount		Amortization Life
Finite-lived intangibles:
Customer relationships	$	54,330	$	2,003	$	52,327	$	4,230	$	1,591	$	2,639	5-30 years
Acquired technology	27,580		393		27,187		980		175		805		3-20 years
Patents	1,138		210		928		889		190		699		20 years
Trade name	6,890		115		6,775		90		37		53		3-12 years
Non-compete agreements	60		35		25		60		25		35		3 years
Total finite-lived intangibles	$	89,998	$	2,756	$	87,242	$	6,249	$	2,018	$	4,231

Amortization expense totaled $0.6 million and $0.2 million for the three months ended June 30, 2012 and 2011, respectively. Amortization expense totaled $0.7 million and $0.3 million for the six months ended June 30, 2012 and 2011, respectively. The amortization of acquired technology is included within product cost of sales; other acquired intangibles are usually amortized within selling, general and administrative expenses.

Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block]

Estimated annual expected amortization expense of the finite-lived intangible assets at June 30, 2012 is as follows (in thousands):

2012 (remaining six months)	$	2,124
2013	4,235
2014	4,195
2015	4,172
2016	3,821
2017	3,786
Thereafter	64,909
Total	$	87,242

XML

Accrued Liabilities (Tables)

6 Months Ended

Jun. 30, 2012

Accrued Liabilities, Current [Abstract]

Schedule of Accrued Liabilities [Table Text Block]

Accrued liabilities consist of the following (in thousands):

	June 30, 2012		December 31, 2011
Advance payments from customers	$	2,805	$	3,390
Accrued Group Purchasing Organization (GPO) fees	2,055		2,437
Acquisition consideration payable	1,833		—
Rebates and lease buyouts	1,125		1,748
Taxes payable	527		925
Other	1,611		401
Total	$	9,956	$	8,901

XML

Net Income Per Share

6 Months Ended

Jun. 30, 2012

Net Income Per Share [Abstract]

Net Income Per Share

Net Income Per Share

Basic net income per share is computed by dividing net income for the period by the weighted average number of shares outstanding during the period, less shares subject to repurchase. Diluted net income per share is computed by dividing net income for the period by the weighted average number of shares less shares subject to repurchase plus, if dilutive, potential common stock outstanding during the period. Potential common stock includes the effect of outstanding dilutive stock options, restricted stock awards and restricted stock units computed using the treasury stock method. Since their impact is anti-dilutive, the total number of shares excluded from the calculations of diluted net income per share for the six months ended June 30, 2012 and 2011 were 2,103,021 and 2,085,850, respectively.

The calculation of basic and diluted net income per share is as follows (in thousands, except per share amounts):

	Three Months Ended June 30,				Six Months Ended June 30,
	2012		2011		2012		2011
Basic:
Net income	$	1,375	$	2,587	$	3,726	$	3,257
Weighted average shares outstanding — basic	33,390		33,003		33,377		33,093
Net income per share — basic	$	0.04	$	0.08	$	0.11	$	0.10
Diluted:
Net income	$	1,375	$	2,587	$	3,726	$	3,257
Weighted average shares outstanding — basic	33,390		33,003		33,377		33,093
Add: Dilutive effect of employee stock plans	926		978		952		946
Weighted average shares outstanding — diluted	34,316		33,981		34,329		34,039
Net income per share — diluted	$	0.04	$	0.08	$	0.11	$	0.10

XML

Deferred Gross Profit (Tables)

6 Months Ended

Jun. 30, 2012

Deferred Gross Profit[Abstract]

Deferred Gross Profit [Table Text Block]

Deferred gross profit consists of the following (in thousands):

	June 30, 2012			December 31, 2011
Sales of medication and supply dispensing systems and packaging equipment,  which have been delivered and invoiced but not yet installed	$	23,463		$	24,181
Cost of revenues, excluding installation costs	(8,985		)	(9,971		)
Deferred gross profit	$	14,478		$	14,210

XML

Organization and Summary of Significant Accounting Policies Significant supplier disclosure (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012 Supplier Concentration Risk [Member]	Jun. 30, 2011 Supplier Concentration Risk [Member]
Unusual Risk or Uncertainty [Line Items]
Purchases from significant supplier	$ 5.2	$ 5.7	$ 11.5	$ 11.2

XML

Goodwill and Other Intangible Assets Amortization expense (finite life intangibles) (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Goodwill and Intangible Assets Disclosure [Abstract]
Amortization of Intangible Assets	$ 0.6	$ 0.2	$ 0.7	$ 0.3

XML

Business Acquisition Acquiree operating results to date since acquisition (Details) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Business Acquisition [Line Items]
Revenues	$ 75,384,000	$ 61,005,000	$ 139,527,000	$ 118,165,000
Net income	1,375,000	2,587,000	3,726,000	3,257,000
Non-acute care solutions [Member]
Business Acquisition [Line Items]
Revenues			8,856,000
Non-acute care solutions [Member] | MTS-Medication Technologies [Member]
Business Acquisition [Line Items]
Revenues			8,856,000
Net income			$ (1,524,000)

XML

CONDENSED CONSOLIDATED BALANCE SHEETS (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011
Current assets:
Cash and cash equivalents	$ 54,071	$ 191,762	[1]
Short-term investments	0	8,107	[1]
Accounts receivable, net of allowances of $337 and $443 at June 30, 2012 and December 31, 2011, respectively	46,390	38,661	[1]
Inventories	25,170	18,107	[1]
Prepaid expenses	11,609	10,495	[1]
Deferred tax assets	11,197	10,352	[1]
Other current assets	7,164	6,107	[1]
Total current assets	155,601	283,591	[1]
Property and equipment, net	28,965	17,306	[1]
Non-current net investment in sales-type leases	9,826	8,785	[1]
Goodwill	113,034	28,543	[1]
Other intangible assets	87,242	4,231	[1]
Non-current deferred tax assets	0	11,677	[1]
Other assets	9,959	9,716	[1]
Total assets	404,627	363,849	[1]
Current liabilities:
Accounts payable	15,687	11,000	[1]
Accrued compensation	13,323	7,328	[1]
Accrued liabilities	9,956	8,901	[1]
Deferred service revenue	19,791	19,191	[1]
Deferred gross profit	14,478	14,210	[1]
Total current liabilities	73,235	60,630	[1]
Non-current deferred service revenue	18,471	18,966	[1]
Non-current deferred tax liabilities	22,124	0
Other long-term liabilities	3,277	1,339	[1]
Total liabilities	117,107	80,935	[1]
Stockholders' equity:
Total stockholders' equity	287,520	282,914	[1]
Total liabilities and stockholders' equity	$ 404,627	$ 363,849	[1]

[1] Information derived from our December 31, 2011 audited Consolidated Financial Statements.

XML

Inventories (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011
Inventory [Abstract]
Raw materials	$ 11,310	$ 7,666
Work in process	585	14
Finished goods	13,275	10,427
Total	$ 25,170	$ 18,107	[1]

[1] Information derived from our December 31, 2011 audited Consolidated Financial Statements.

XML

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2012		Jun. 30, 2011
Cash flows from operating activities:
Net income	$ 3,726		$ 3,257
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	5,333		3,794
Loss on disposal of fixed assets	19		0
Provision for (recovery of) receivable allowance	335		(43)
Share-based compensation expense	4,420		4,843
Income tax benefits from employee stock plans	(156)		2,303
Excess tax benefits from employee stock plans	(901)		(2,517)
Provision for excess and obsolete inventories	254		865
Foreign currency remeasurement loss	(23)		(8)
Deferred income taxes	(535)		(491)
Changes in operating assets and liabilities:
Accounts receivable, net	(287)		(384)
Inventories	4,409		(8,462)
Prepaid expenses	(1,114)		1,391
Other current assets	799		(288)
Net investment in sales-type leases	(780)		710
Other assets	(27)		215
Accounts payable	(817)		1,138
Accrued compensation	5,995		391
Accrued liabilities	(3,320)		(1,260)
Deferred service revenue	449		2,278
Deferred gross profit	268		(419)
Other long-term liabilities	711		(50)
Net cash provided by operating activities	18,758		7,263
Cash flows from investing activities:
Maturities of short-term investments	8,122		8,143
Acquisition of intangible assets and intellectual property	(249)		(69)
Software development for external use	(1,414)		(3,088)
Purchases of property and equipment	(4,087)		(4,764)
Business acquisition, net of cash acquired	(156,312)		0
Net cash (used in) provided by investing activities	(153,940)		222
Cash flows from financing activities:
Proceeds from issuance of common stock under employee stock purchase and stock option plans	3,627		3,613
Stock repurchases	(7,060)		(8,000)
Excess tax benefits from employee stock plans	901		2,517
Net cash used in financing activities	(2,532)		(1,870)
Effect of exchange rate changes on cash and cash equivalents	23		8
Net (decrease) increase in cash and cash equivalents	(137,691)		5,623
Cash and cash equivalents at beginning of period	191,762	[1]	175,635
Cash and cash equivalents at end of period	54,071		181,258
Supplemental disclosure of non-cash operating activity:
Acquistiion consideration accrued but not paid	(1,833)		0
Satisfaction of acquired legal contingency with indemnification asset	$ 0		$ (1,200)

[1] Information derived from our December 31, 2011 audited Consolidated Financial Statements.

XML

Commitments rented properties data (Details) (USD $) In Millions, unless otherwise specified	6 Months Ended	53 Months Ended	6 Months Ended	53 Months Ended	6 Months Ended
	Jun. 30, 2012 Lease- Mountain View, CA 590 Middlefield road [Member]	Jun. 30, 2012 Lease- Mountain View, CA 590 Middlefield road [Member] square_foot	Jun. 30, 2012 Lease - Milpitas, CA 735 Sycamore Drive [Member]	Jun. 30, 2012 Lease - Milpitas, CA 735 Sycamore Drive [Member] square_foot	Jun. 30, 2012 Lease - St. Petersburg, FL 2003 gaudy Bldvd. North [Member] square_foot	Jun. 30, 2011 Lease - St. Petersburg, FL 2003 gaudy Bldvd. North [Member]	Jun. 30, 2012 lease - Leeds, United Kingdom [Member]
Operating Leased Assets [Line Items]
property subject to operating lease, net rentable area		100,000		46,000	132,500
property subject to operating lease term duration		10 years		60 months
Operating Leases, Rent Expense, Minimum Rentals		$ 40.0		$ 1.8		$ 3.9	$ 1.2
property subject to lease, 1st extension term duration					12 years		10 years
Property subject to operating lease, 2nd extension term duration	60 months				60 months
Lease Expiration Date					Sep. 30, 2016		Jun. 08, 2021
property subject to lease, 1st extension term duration	60 months		60 months		60 months		0

XML

Business Acquisition (Tables)

6 Months Ended

Jun. 30, 2012

Business Acquisition [Abstract]

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed [Table Text Block]

The total acquisition price was approximately $160.1 million and the preliminary acquisition price allocation was comprised of the following (in thousands):

	Fair value acquired
Cash including restricted cash	$	2,000
Accounts receivable	7,403
Inventory	11,726
Deferred tax assets and other current assets	2,864
Total current assets	23,993
Property and equipment	11,088
Intangibles	83,500
Goodwill	84,491
Other non-current assets	244
Total assets	203,316
Current liabilities	(8,046		)
Non-current deferred tax liabilities	(33,898		)
Other non-current liabilities	(1,227		)
Net assets acquired	$	160,145
Cash consideration, fair value	$	160,145

Schedule of Finite-Lived Intangible Assets Acquired as Part of Business Combination [Table Text Block]

Details of acquired intangibles are as follows (in thousands, except for years):

	Fair value acquired		Useful Life (years)	First year amortization expense
Trade name	$	6,800	12	$	567
Customer relationships	50,100		28 to 30	1,693
Acquired technology	26,600		20	1,330
Intangibles acquired	$	83,500		$	3,590
Weighted avg. life of intangibles			25.11

Business Acquisition, Pro Forma Information [Table Text Block]

The following represents unaudited pro forma revenue and net income as if MTS had been included in our consolidated results from January 1, 2011 (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2012		2011		2012		2011
Revenues	$	85,204	$	80,798	$	168,270	$	157,247
Net income	$	4,110	$	3,874	$	6,595	$	6,056

The pro forma unaudited condensed consolidated operating results presented above were calculated after applyin

XML

Stock Option Plans and Share-Based Compensation Restricted Stock Awards and RSUs rollforward (Details) (USD $) In Millions, except Share data, unless otherwise specified	6 Months Ended
	Jun. 30, 2012	Dec. 31, 2011
Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized, Share-based Awards Other than Options	$ 0.8
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number	67,000	68,000
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value	$ 14.19	$ 14.71
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period	67,000
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value	$ 14.19
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period	(68,000)
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period, Weighted Average Grant Date Fair Value	$ 14.71
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeited in Period	0
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeitures, Weighted Average Grant Date Fair Value	$ 0.00
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized, Period for Recognition	10 months 21 days
Restricted Stock Units (RSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized, Share-based Awards Other than Options	$ 5.3
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number	398,000	287,000
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value	$ 13.90	$ 13.03
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period	197,000
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value	$ 14.82
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period	(73,000)
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period, Weighted Average Grant Date Fair Value	$ 12.81
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeited in Period	(13,000)
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeitures, Weighted Average Grant Date Fair Value	$ 14.51
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized, Period for Recognition	2 years 9 months

XML

Risk Management and Derivatives

6 Months Ended

Jun. 30, 2012

Risk Management and Derivatives [Abstract]

Derivative Instruments and Hedging Activities Disclosure [Text Block]

Risk Management and Derivatives

We are exposed to global market risks, including the effect of changes in foreign currency exchange rates. We use derivatives to manage financial exposures that occur in the normal course of business but do not hold or issue derivatives for trading purposes.

Cash Flow Hedges

The purpose of our foreign currency hedging activities is to protect our business from the risk that the eventual cash flows resulting from transactions in foreign currencies, primarily product costs manufactured in the U.S. and sold to foreign subsidiaries in U.S. dollars and other intercompany transactions, including intercompany borrowings, will be adversely affected by changes in exchange rates. Our policy is to utilize derivatives to reduce foreign exchange risks where internal netting strategies cannot be effectively employed.

Results of hedges of anticipated intercompany transactions are recorded in other (income) expense, net when the transaction occurs. Hedges of recorded balance sheet positions are recorded in other (income) expense, net currently together with the transaction gain or loss from the hedged balance sheet position. Net foreign currency transaction gains and losses, were immaterial for the six months ended June 30, 2012 and 2011, respectively.

 As of June 30, 2012, an immaterial amount of deferred net gains (net of tax) on both outstanding and matured derivatives accumulated in other comprehensive income is expected to be reclassified to net income during the next 12 months as a result of underlying hedged transactions also being recorded in net income. Actual amounts ultimately reclassified to net income are dependent on the exchange rates in effect when derivative contracts that are currently outstanding mature. As of June 30, 2012, the maximum term over which we are hedging exposures to the variability of cash flows for our forecast transactions is three months.

XML

Segments (Tables)

6 Months Ended

Jun. 30, 2012

Segments [Abstract]

Schedule of Segment Reporting Information, by Segment [Table Text Block]

For the three months and six months ended June 30, 2012 and 2011, the contributions of our segments to net revenues and income (loss) from operations, and the reconciliation to total net income, is as follows (amounts in thousands):

	Three Months Ended June 30,									Three Months Ended June 30,
	2012									2011
	Acute Care			Non-Acute Care (1)			Total			Acute Care			Total
Net revenues from external customers	$	66,528		$	8,856		$	75,384		$	61,005		$	61,005
Cost of revenues	29,158			6,850			36,008			27,198			27,198
Gross profit	$	37,370		$	2,006		$	39,376		$	33,807		$	33,807
Gross margin %	56.2		%	22.7		%	52.2		%	55.4		%	55.4		%
Operating expenses	33,458			3,487			36,945			29,577			29,577
Income from operations	$	3,912		$	(1,481	)	$	2,431		$	4,230		$	4,230
Operating margin %	5.9		%	(16.7		)%	3.2		%	6.9		%	6.9		%
Interest and other income (expense), net							(73		)				71
Income before provision for income taxes							2,358						4,301
Provision for income taxes							983						1,714
Net income							$	1,375					$	2,587
(1) Non-Acute Care segment included from the May 21, 2012 acquisition of MTS

	Six Months Ended June 30,									Six Months Ended June 30,
	2012									2011
	Acute Care			Non-Acute Care (1)			Total			Acute Care			Total
Net revenues from external customers	$	130,671		$	8,856		$	139,527		$	118,165		$	118,165
Cost of revenues	57,552			6,850			64,402			52,708			52,708
Gross profit	$	73,119		$	2,006		$	75,125		$	65,457		$	65,457
Gross margin %	56.0		%	22.7		%	53.8		%	55.4		%	55.4		%
Operating expenses	65,572			3,487			69,059			60,198			60,198
Income from operations	$	7,547		$	(1,481	)	$	6,066		$	5,259		$	5,259
Operating margin %	5.8		%	(16.7		)%	4.3		%	4.5		%	4.5		%
Interest and other income (expense), net							23						125
Income before provision for income taxes							6,089						5,384
Provision for income taxes							2,363						2,127
Net income							$	3,726					$	3,257
(1) Non-Acute Care segment included from the May 21, 2012 acquisition of MTS

For the three months and the six months ended June 30, 2012, the Non-Acute Care cost of revenues included $1.7 million of acquisition-related charges primarily associated with the step-up to the estimated fair value of inventory acquired from MTS and consumed in the normal manufacturing cycle of our business. The Non-Acute Care operating expenses included $0.9 million of acquisition-related charges primarily associated with severance expenses. For the three months and the six months ended June 30, 2012, the Acute Care operating expenses included $2.3 million of acquisition-related charges for transaction costs, required to be expensed under ASC 805 Business Combinations.

As of June 30, 2012 we have not assigned assets to our operating segments.

XML

Organization and Summary of Significant Accounting Policies (Policies)

6 Months Ended

53 Months Ended

Jun. 30, 2012

Jun. 30, 2011

Jun. 30, 2012

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Accounting, Policy [Policy Text Block]

Basis of presentation. These interim condensed consolidated financial statements are unaudited but reflect, in the opinion of management, all adjustments, consisting of normal recurring adjustments and accruals, necessary to present fairly the financial position of Omnicell and its subsidiaries as of June 30, 2012, the results of their operations and comprehensive income for the three months and six months ended June 30, 2012 and 2011 and their cash flows for the six months ended June 30, 2012 and 2011. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”), have been condensed or omitted in accordance with the rules and regulations of the Securities and Exchange Commission (“SEC”). These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and accompanying notes included in our Annual Report on Form 10-K for the year ended December 31, 2011.

Our results of operations, comprehensive income and cash flows for the three months and six months ended June 30, 2012 are not necessarily indicative of results that may be expected for the year ending December 31, 2012, or for any future period. 

Use of Estimates, Policy [Policy Text Block]

Use of estimates. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

Consolidation, Subsidiaries or Other Investments, Consolidated Entities, Policy [Policy Text Block]

Principles of consolidation. The condensed consolidated financial statements include the accounts of our wholly-owned subsidiaries. All significant inter-company accounts and transactions have been eliminated in consolidation.

Reclassification, Policy [Policy Text Block]

Reclassifications. Certain reclassifications have been made to the prior year consolidated balance sheet to conform to the current period presentation, including reclassification of net receivable credit balances by customer from accounts receivable to customer advances. None of these reclassifications are material to the consolidated financial statements.

Foreign Currency Transactions and Translations Policy [Policy Text Block]

Foreign currency translation. We translate the assets and liabilities of our non-U.S. dollar functional currency subsidiaries into U.S. dollars using exchange rates in effect at the end of each period. Revenue and expenses for these subsidiaries are translated using rates that approximate those in effect during the period. Gains and losses from these translations are recorded as foreign currency translation adjustments and included in accumulated other comprehensive income in stockholders’ equity.

F

Fair Value of Financial Instruments, Policy [Policy Text Block]

Fair value of financial instruments. We value our financial assets and liabilities on a recurring basis using the fair value hierarchy established in Accounting Standards Codification (“ASC”) 820, Fair Value Measurements and Disclosures.

ASC 820 describes three levels of inputs that may be used to measure fair value, as follows:

Level 1 inputs, which include quoted prices in active markets for identical assets or liabilities;

Level 2 inputs, which include observable inputs other than Level 1 inputs, such as quoted prices for similar assets or liabilities, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the asset or liability; and

Level 3 inputs, which include unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the underlying asset or liability. Level 3 assets and liabilities include those whose fair value measurements are determined using pricing models, discounted cash flow methodologies or similar valuation techniques, as well as significant management judgment or estimation.

At June 30, 2012 and December 31, 2011, our financial assets, measured at fair value on a recurring basis, utilizing Level 1 inputs included cash equivalents. For these items, quoted market prices are readily available and fair value approximates carrying value. At December 31, 2011, we had a short-term investment in California revenue anticipation notes, measured at fair value on a recurring basis, the valuation inputs of which were classified as Level 2. We do not currently have any material financial instruments, measured at fair value on a recurring basis, utilizing Level 3 inputs.

Marketable Securities, Policy [Policy Text Block]

Classification of marketable securities. Securities held as investments for the indefinite future, pending future spending requirements are classified as “Available-for-sale” and are carried at their fair value, with any unrealized gain or loss recorded to other comprehensive income until realized. At June 30, 2012 and December 31, 2011, we held $33.6 million and $177.3 million, respectively, of money market mutual funds classified as Available-for-sale cash equivalents. At December 31, 2011, we held $8.1 million of non-U.S. Government securities classified as Available-for-sale short-term investments. We do not hold securities for purposes of trading. Marketable securities for which we have the intent and ability to hold to maturity are classified as “Held-to-maturity” and are carried at their amortized cost, including accrued interest. There were no Held-to-maturity securities held at June 30, 2012 and December 31, 2011.

Acc

Derivative Instruments and Hedging Activities Disclosure [Text Block]

Accounting for derivatives and hedging activities. Commencing with our May 21, 2012 acquisition of MTS, we use derivative financial instruments to limit exposure to changes in foreign currency exchange rates. We account for derivatives pursuant to ASC 815, Derivatives and Hedging. The ASC 815 guidance establishes accounting and reporting standards for derivative instruments and requires that all derivatives be recorded at fair value on the balance sheet. Changes in the fair value of derivative financial instruments are either recognized in other comprehensive income (a component of shareholders’ equity) or net income depending on whether the derivative is being used to hedge changes in cash flows or fair value.

Segment Reporting, Policy [Policy Text Block]

Segment information. Beginning with the May 21, 2012 acquisition of MTS, we manage our business on the basis of two operating segments: Acute Care and Non-Acute Care. The historical Omnicell results reported as a single segment and reporting unit comprise the Acute Care segment. MTS comprises the Non-Acute Care segment and reporting unit.

Revenue Recognition, Policy [Policy Text Block]

Revenue recognition. We earn revenues from sales of our medication control systems together with related consumables and services, and medical/surgical supply control systems, with related services, which are sold in our principal market, which is the healthcare industry. Our customer arrangements typically include one or more of the following deliverables:

• Products — Software-enabled equipment that manages and regulates the storage and dispensing of pharmaceuticals, consumable blister cards and packaging equipment and other medical supplies.

• Software — Additional software applications that enable incremental functionality of our equipment.

• Installation — Installation of equipment as integrated systems at customers’ sites.

• Post-installation technical support — Phone support, on-site service, parts and access to unspecified software upgrades and enhancements, if and when available.

• Professional services — Other customer services, such as training and consulting.

We recognize revenue on our equipment when the earnings process is complete, based upon our evaluation of whether the following four criteria have been met:

•Persuasive evidence of an arrangement exists. We use signed customer contracts and signed customer purchase orders as evidence of an arrangement for leases and sales. For service engagements, we use a signed services agreement and a statement of work to evidence an arrangement.

•Delivery has occurred. Equipment and software product delivery is deemed to occur upon successful installation and receipt of a signed and dated customer confirmation of installation letter, providing evidence that we have delivered what a customer ordered. In instances of a customer self-installed installation, product delivery is deemed to have occurred upon receipt of a signed and dated customer confirmation letter. If a sale does not require installation, we recognize revenue on delivery of products to the customer, including transfer of title and risk of loss, assuming all other revenue criteria are met. We recognize revenue from sales of products to distributors upon delivery, assuming all other revenue criteria are met since we do not allow for rights of return or refund. Assuming all other revenue criteria are met, we recognize revenue for support services ratably over the related support services contract period. We recognize revenue on training and professional services as they are performed.

•Fee is fixed or determinable. We assess whether a fee is fixed or determinable at the outset of the arrangement based on the payment terms associated with the transaction. We have established a history of collecting under the original contract without providing concessions on payments, products or services.

•Collection is probable. We assess the probability of collecting from each customer at the outset of the arrangement based on a number of factors, including the customer’s payment history and its current creditworthiness. If, in our judgment, collection of a fee is not probable, we defer the revenue until the uncertainty is removed, which generally means revenue is recognized upon our receipt of cash payment assuming all other revenue criteria are met. Our historical experience has been that collection from our customers is generally probable.

In arrangements with multiple deliverables, assuming all other revenue criteria are met, we recognize revenue for individual delivered items if they have value to the customer on a standalone basis. Effective for new or modified arrangements entered into beginning on January 1, 2011, the date we adopted the revised revenue recognition guidance for arrangements with multiple deliverables on a prospective basis, we allocate arrangement consideration at the inception of the arrangement to all deliverables using the relative selling price method. This method requires us to determine the selling price at which each deliverable could be sold if it were sold regularly on a standalone basis. When available, we use vendor-specific objective evidence (“VSOE”) of fair value as the selling price. VSOE represents the price charged for a deliverable when it is sold separately or for a deliverable not yet being sold separately, the price established by management with the relevant authority. We consider VSOE to exist when approximately 80% or more of our standalone sales of an item are priced within a reasonably narrow pricing range (plus or minus 15% of the median rates). We have established VSOE of fair value for our post-installation technical support services and professional services. When VSOE of fair value is not available, third-party evidence (“TPE”) of fair value for similar products and services is acceptable; however, our offerings and market strategy differ from those of our competitors, such that we cannot obtain sufficient comparable information about third parties’ prices. If neither VSOE nor TPE are available, we use our best estimates of selling prices (“BESP”). We determine BESP considering factors such as market conditions, sales channels, internal costs and product margin objectives and pricing practices. We regularly review and update our VSOE, TPE and BESP information and obtain formal approval by appropriate levels of management.

The relative selling price method allocates total arrangement consideration proportionally to each deliverable on the basis of its estimated selling price. In addition, the amount recognized for any delivered items cannot exceed that which is not contingent upon delivery of any remaining items in the arrangement.

We also use the residual method of allocating the arrangement consideration in certain circumstances. We use the residual method to allocate total arrangement consideration between delivered and undelivered items for any arrangements entered into prior to January 1, 2011 and not subsequently materially-modified. The use of the residual method is required by software revenue recognition rules that applied to sales of most of our products and services until the adoption of the new revenue recognition guidance. We also use the residual method to allocate revenue between the software products that enable incremental equipment functionality and thus are not deemed to deliver its essential functionality, and the related post-installation technical support, as these products and services continue to be accounted for under software revenue recognition rules. Under the residual method, the amount allocated to the undelivered elements equals VSOE of fair value of these elements. Any remaining amounts are attributed to the delivered items and are recognized when those items are delivered.

A portion of our sales are made through multi-year lease agreements. Under sales-type leases, we recognize revenue for our hardware and software products net of lease execution costs such as post-installation product maintenance and technical support, at the net present value of the lease payment stream once our installation obligations have been met. We optimize cash flows by selling a majority of our non-U.S. government leases to third-party leasing finance companies on a non-recourse basis. We have no obligation to the leasing company once the lease has been sold. Some of our sales-type leases, mostly those relating to U.S. government hospitals, are retained in-house. Interest income in these leases is recognized in product revenue using the interest method.

We recognize revenue on the sale of consumable blister cards when title and risk of loss to the products shipped has transferred to the customer. Revenue related to these products is reported net of discounts provided to customers.

Receivables, Policy [Policy Text Block]

Accounts receivable and notes receivable (net investment in sales type leases). We actively manage our accounts receivable to minimize credit risk. We typically sell to customers for which there is a history of successful collection. New customers are subject to a credit review process, which evaluates that customer’s financial position and ability to pay. We continually monitor and evaluate the collectability of our trade receivables based on a combination of factors. We record specific allowances for doubtful accounts when we become aware of a specific customer’s impaired ability to meet its financial obligation to us, such as in the case of bankruptcy filings or deterioration of financial position.

Uncollectible amounts are charged off against trade receivables and the allowance for doubtful accounts when we make a final determination there is no reasonable expectation of recovery. Estimates are used in determining our allowances for all other customers based on factors such as current trends, the length of time the receivables are past due and historical collection experience. While we believe that our allowance for doubtful accounts receivable is adequate and that the judgment applied is appropriate, such estimated amounts could differ materially from what will actually be uncollectible in the future.

The retained in-house leases discussed above are considered financing receivables. Our credit policies and evaluation of credit risk and write-off policies are applied alike to trade receivables and the net-investment in sales-type leases. For both, an account is generally past due after thirty days. The financing receivables also have customer-specific reserves for accounts identified for specific impairment and a non-specific reserve applied to the remaining population, based on factors such as current trends, the length of time the receivables are past due and historical collection experience. The retained in-house leases are not stratified by portfolio or class. Financing receivables which are reserved are generally transferred to cash-basis accounting so that revenue is recognized only as cash is received. However, the cash basis accounts continue to accrue interest.

Transfers and Servicing of Financial Assets, Transfers of Financial Assets, Sales, Policy [Policy Text Block]

Sales of accounts receivable. We record the sale of our accounts receivables as “true sales” in accordance with accounting guidance for transfers and servicing of financial assets.

Shipping and Handling Cost, Policy [Policy Text Block]

Accounting policy for shipping costs. Outbound freight billed to customers is recorded as product revenue. The related shipping and handling cost is expensed as part of selling, general and administrative expense.

Income Tax, Policy [Policy Text Block]

Income taxes. We record an income tax provision for the anticipated tax consequences of the reported results of operations. In accordance with GAAP, the provision for income taxes is computed using the asset and liability method, under which deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities, and for operating losses and tax credit carry forwards. Deferred tax assets and liabilities are measured using the enacted tax rates expected to apply in the periods in which those tax assets and liabilities are expected to be realized. In the event that we determine all or part of the net deferred tax assets are not realizable in the future, we will record a valuation allowance that would be charged to earnings in the period such determination is made.

In accordance with ASC 740, Tax Provisions, we recognize the tax benefit from an uncertain tax position if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such positions are then measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. The calculation of tax liabilities involves significant judgment in estimating the impact of uncertainties in the application of GAAP and complex tax laws. Resolution of these uncertainties in a manner inconsistent with management’s expectations could have a material impact on our financial condition and operating results.

We provide for income taxes for each interim period based on the estimated annual effective tax rate for the year, adjusting for discrete items in the quarter in which they arise. The annual effective tax rate before discrete items was 40.9% and 41.7% for the six months ended June 30, 2012 and 2011, respectively. The 2012 annual effective tax rate differed from the statutory rate of 35% primarily due to the unfavorable impact of state income taxes, non-deductible equity charges, and other non-deductible expenditures, which were partially offset by the domestic production activities deduction.

The 2011 annual effective tax rate differed from the statutory rate of 35%, primarily due to the unfavorable impact of state income taxes, non-deductible equity charges, and other non-deductible expenditures, which were partially offset by the federal research and development credit claimed and the domestic production activities deduction. Our effective tax rate, after discrete items, for the six months ended June 30, 2012 and 2011, was approximately 40.4% and 41.0%, respectively.

As of June 30, 2012, we had total gross unrecognized tax benefits of approximately $7.2 millioncompared with approximately $5.8 millionon December 31, 2011, representing an increase of approximately $1.4 millionduring the six months ended June 30, 2012. Approximately $1.0 million of the increase was attributable to unrecognized tax benefits recorded as part of the MTS acquisition. Of the total unrecognized tax benefits, $6.0 millionand $4.6 millionas of June 30, 2012 and  December 31, 2011 respectively, if recognized would reduce our effective tax rate in the period of recognition. Gross interest and penalty related to unrecognized tax benefit accrued was immaterial as of June 30, 2012 and December 31, 2011.

Recently adopted accounting pronouncements. In May 2011, the Financial Accounting Standards Board

New Accounting Pronouncements, Policy [Policy Text Block]

Recently adopted accounting pronouncements. In May 2011, the Financial Accounting Standards Board (“FASB”) issued ASU 2011-04, Fair Value Measurement, amending the fair value guidance in ASC 820, and thereby achieving substantially converged fair value measurement and disclosure requirements for GAAP and International Financial Reporting Standards (“IFRS”). The new guidance clarified some fair value measurement principles and expanded certain disclosure requirements. We adopted this guidance in the first quarter of 2012 without any impact to our financial position, operating results or cash flows.

Earnings Per Share, Policy [Policy Text Block]

Basic net income per share is computed by dividing net income for the period by the weighted average number of shares outstanding during the period, less shares subject to repurchase. Diluted net income per share is computed by dividing net income for the period by the weighted average number of shares less shares subject to repurchase plus, if dilutive, potential common stock outstanding during the period. Potential common stock includes the effect of outstanding dilutive stock options, restricted stock awards and restricted stock units computed using the treasury stock method.

Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block]

We account for share-based awards granted to employees and directors, including employee stock option awards, restricted stock, PSUs and RSUs issued pursuant to the 2009 Plan and employee stock purchases made under our ESPP using the estimated grant date fair value method of accounting in accordance with ASC 718, Stock Compensation. We value options and ESPP shares using the Black-Scholes-Merton option-pricing model. Restricted stock and time-based RSUs are valued at the grant date fair value of the underlying common shares. The PSUs are valued via Monte Carlo simulation, as described above.

performance-based restricted stock units [Policy Text Block]

The fair value of a PSU award is the average of trial-specific values of the award over each of one million Monte Carlo trials. Each trial-specific value is the market value of the award at the end of the one-year performance period discounted back to the grant date. The market value of the award for each trial at the end of the performance period is the product of (a) the per share value of Omnicell stock at the end of the performance period and (b) the number of shares that vest. The number of shares that vest at the end of the performance period depends on the percentile ranking of the total shareholder return for Omnicell stock over the performance period relative to the total shareholder return of each of the other companies in the Index as shown in the tables below.

Vesting for the PSU awards is based on the percentile placement of our total shareholder return among the companies listed in the NASDAQ Healthcare Index (the “Index”) and time-based vesting. We calculate total stockholder return based on the one year annualized rates of return reflecting price appreciation plus reinvestment of dividends. Stock price appreciation is calculated based on the average closing prices of the applicable company’s common stock for the 20 trading days ending on the last trading day of the year prior to the date of grant as compared to the average closing prices for the 20 trading days ended on the last trading day of the year of grant.

The

XML

Stock Option Plans and Share-Based Compensation ESPP- Employee stock purchase plan (Details) (USD $)	3 Months Ended	6 Months Ended
	Jun. 30, 2011	Jun. 30, 2012
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common Stock, Capital Shares Reserved for Future Issuance		1,881,980
Employee Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
ESPP max percent of earnings contributable		15.00%
essp max annual contribution		$ 25,000
ESPP purchase price as percent of begin and-or ending fair value		85.00%
Shares, Issued		3,602,826
Common Stock, Capital Shares Reserved for Future Issuance		1,728,729
Share-based Compensation Arrangement by Share-based Payment Award, Shares Issued in Period	0	197,831

XML

Organization and Summary of Significant Accounting Policies

6 Months Ended

Jun. 30, 2012

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Organization and Summary of Significant Accounting Policies

Organization and Summary of Significant Accounting Policies

Description of the Company. Omnicell, Inc. (“Omnicell,” “our,” “us,” “we,” or the “Company”) was incorporated in California in 1992 under the name Omnicell Technologies, Inc. and reincorporated in Delaware in 2001 as Omnicell, Inc. Our major products are medication control systems together with related consumables and services, and medical/surgical supply control systems, with related services, which are sold in our principal market, the healthcare industry. Our market is located primarily in the United States.

On May 21, 2012, we completed our acquisition of MedPak Holdings, Inc. (“MedPak”). MedPak is the parent company of MTS Medication Technologies, Inc. (“MTS”), a worldwide provider of medication adherence packaging systems. This acquisition aligns us with the long-term trends of the healthcare market to manage the health of patients across the continuum of care. We can now serve both the acute care and non-acute markets. Omnicell and MTS bring capabilities to each other that strengthen the product lines and expand the medication management coverage of both companies. Please refer to Note 14, “Business Acquisition” for more information.

Basis of presentation. These interim condensed consolidated financial statements are unaudited but reflect, in the opinion of management, all adjustments, consisting of normal recurring adjustments and accruals, necessary to present fairly the financial position of Omnicell and its subsidiaries as of June 30, 2012, the results of their operations and comprehensive income for the three months and six months ended June 30, 2012 and 2011 and their cash flows for the six months ended June 30, 2012 and 2011. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”), have been condensed or omitted in accordance with the rules and regulations of the Securities and Exchange Commission (“SEC”). These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and accompanying notes included in our Annual Report on Form 10-K for the year ended December 31, 2011.

Our results of operations, comprehensive income and cash flows for the three months and six months ended June 30, 2012 are not necessarily indicative of results that may be expected for the year ending December 31, 2012, or for any future period. 

Use of estimates. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

Principles of consolidation. The condensed consolidated financial statements include the accounts of our wholly-owned subsidiaries. All significant inter-company accounts and transactions have been eliminated in consolidation.

Reclassifications. Certain reclassifications have been made to the prior year consolidated balance sheet to conform to the current period presentation, including reclassification of net receivable credit balances by customer from accounts receivable to customer advances. None of these reclassifications are material to the consolidated financial statements.

Foreign currency translation. We translate the assets and liabilities of our non-U.S. dollar functional currency subsidiaries into U.S. dollars using exchange rates in effect at the end of each period. Revenue and expenses for these subsidiaries are translated using rates that approximate those in effect during the period. Gains and losses from these translations are recorded as foreign currency translation adjustments and included in accumulated other comprehensive income in stockholders’ equity.

Fair value of financial instruments. We value our financial assets and liabilities on a recurring basis using the fair value hierarchy established in Accounting Standards Codification (“ASC”) 820, Fair Value Measurements and Disclosures.

ASC 820 describes three levels of inputs that may be used to measure fair value, as follows:

Level 1 inputs, which include quoted prices in active markets for identical assets or liabilities;

Level 2 inputs, which include observable inputs other than Level 1 inputs, such as quoted prices for similar assets or liabilities, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the asset or liability; and

Level 3 inputs, which include unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the underlying asset or liability. Level 3 assets and liabilities include those whose fair value measurements are determined using pricing models, discounted cash flow methodologies or similar valuation techniques, as well as significant management judgment or estimation.

At June 30, 2012 and December 31, 2011, our financial assets, measured at fair value on a recurring basis, utilizing Level 1 inputs included cash equivalents. For these items, quoted market prices are readily available and fair value approximates carrying value. At December 31, 2011, we had a short-term investment in California revenue anticipation notes, measured at fair value on a recurring basis, the valuation inputs of which were classified as Level 2. We do not currently have any material financial instruments, measured at fair value on a recurring basis, utilizing Level 3 inputs.

Classification of marketable securities. Securities held as investments for the indefinite future, pending future spending requirements are classified as “Available-for-sale” and are carried at their fair value, with any unrealized gain or loss recorded to other comprehensive income until realized. At June 30, 2012 and December 31, 2011, we held $33.6 million and $177.3 million, respectively, of money market mutual funds classified as Available-for-sale cash equivalents. At December 31, 2011, we held $8.1 million of non-U.S. Government securities classified as Available-for-sale short-term investments. We do not hold securities for purposes of trading. Marketable securities for which we have the intent and ability to hold to maturity are classified as “Held-to-maturity” and are carried at their amortized cost, including accrued interest. There were no Held-to-maturity securities held at June 30, 2012 and December 31, 2011.

Accounting for derivatives and hedging activities. Commencing with our May 21, 2012 acquisition of MTS, we use derivative financial instruments to limit exposure to changes in foreign currency exchange rates. We account for derivatives pursuant to ASC 815, Derivatives and Hedging. The ASC 815 guidance establishes accounting and reporting standards for derivative instruments and requires that all derivatives be recorded at fair value on the balance sheet. Changes in the fair value of derivative financial instruments are either recognized in other comprehensive income (a component of shareholders’ equity) or net income depending on whether the derivative is being used to hedge changes in cash flows or fair value.

Segment information. Beginning with the May 21, 2012 acquisition of MTS, we manage our business on the basis of two operating segments: Acute Care and Non-Acute Care. The historical Omnicell results reported as a single segment and reporting unit comprise the Acute Care segment. MTS comprises the Non-Acute Care segment and reporting unit.

Revenue recognition. We earn revenues from sales of our medication control systems together with related consumables and services, and medical/surgical supply control systems, with related services, which are sold in our principal market, which is the healthcare industry. Our customer arrangements typically include one or more of the following deliverables:

• Products — Software-enabled equipment that manages and regulates the storage and dispensing of pharmaceuticals, consumable blister cards and packaging equipment and other medical supplies.

• Software — Additional software applications that enable incremental functionality of our equipment.

• Installation — Installation of equipment as integrated systems at customers’ sites.

• Post-installation technical support — Phone support, on-site service, parts and access to unspecified software upgrades and enhancements, if and when available.

• Professional services — Other customer services, such as training and consulting.

We recognize revenue on our equipment when the earnings process is complete, based upon our evaluation of whether the following four criteria have been met:

•Persuasive evidence of an arrangement exists. We use signed customer contracts and signed customer purchase orders as evidence of an arrangement for leases and sales. For service engagements, we use a signed services agreement and a statement of work to evidence an arrangement.

•Delivery has occurred. Equipment and software product delivery is deemed to occur upon successful installation and receipt of a signed and dated customer confirmation of installation letter, providing evidence that we have delivered what a customer ordered. In instances of a customer self-installed installation, product delivery is deemed to have occurred upon receipt of a signed and dated customer confirmation letter. If a sale does not require installation, we recognize revenue on delivery of products to the customer, including transfer of title and risk of loss, assuming all other revenue criteria are met. We recognize revenue from sales of products to distributors upon delivery, assuming all other revenue criteria are met since we do not allow for rights of return or refund. Assuming all other revenue criteria are met, we recognize revenue for support services ratably over the related support services contract period. We recognize revenue on training and professional services as they are performed.

•Fee is fixed or determinable. We assess whether a fee is fixed or determinable at the outset of the arrangement based on the payment terms associated with the transaction. We have established a history of collecting under the original contract without providing concessions on payments, products or services.

•Collection is probable. We assess the probability of collecting from each customer at the outset of the arrangement based on a number of factors, including the customer’s payment history and its current creditworthiness. If, in our judgment, collection of a fee is not probable, we defer the revenue until the uncertainty is removed, which generally means revenue is recognized upon our receipt of cash payment assuming all other revenue criteria are met. Our historical experience has been that collection from our customers is generally probable.

In arrangements with multiple deliverables, assuming all other revenue criteria are met, we recognize revenue for individual delivered items if they have value to the customer on a standalone basis. Effective for new or modified arrangements entered into beginning on January 1, 2011, the date we adopted the revised revenue recognition guidance for arrangements with multiple deliverables on a prospective basis, we allocate arrangement consideration at the inception of the arrangement to all deliverables using the relative selling price method. This method requires us to determine the selling price at which each deliverable could be sold if it were sold regularly on a standalone basis. When available, we use vendor-specific objective evidence (“VSOE”) of fair value as the selling price. VSOE represents the price charged for a deliverable when it is sold separately or for a deliverable not yet being sold separately, the price established by management with the relevant authority. We consider VSOE to exist when approximately 80% or more of our standalone sales of an item are priced within a reasonably narrow pricing range (plus or minus 15% of the median rates). We have established VSOE of fair value for our post-installation technical support services and professional services. When VSOE of fair value is not available, third-party evidence (“TPE”) of fair value for similar products and services is acceptable; however, our offerings and market strategy differ from those of our competitors, such that we cannot obtain sufficient comparable information about third parties’ prices. If neither VSOE nor TPE are available, we use our best estimates of selling prices (“BESP”). We determine BESP considering factors such as market conditions, sales channels, internal costs and product margin objectives and pricing practices. We regularly review and update our VSOE, TPE and BESP information and obtain formal approval by appropriate levels of management.

The relative selling price method allocates total arrangement consideration proportionally to each deliverable on the basis of its estimated selling price. In addition, the amount recognized for any delivered items cannot exceed that which is not contingent upon delivery of any remaining items in the arrangement.

We also use the residual method of allocating the arrangement consideration in certain circumstances. We use the residual method to allocate total arrangement consideration between delivered and undelivered items for any arrangements entered into prior to January 1, 2011 and not subsequently materially-modified. The use of the residual method is required by software revenue recognition rules that applied to sales of most of our products and services until the adoption of the new revenue recognition guidance. We also use the residual method to allocate revenue between the software products that enable incremental equipment functionality and thus are not deemed to deliver its essential functionality, and the related post-installation technical support, as these products and services continue to be accounted for under software revenue recognition rules. Under the residual method, the amount allocated to the undelivered elements equals VSOE of fair value of these elements. Any remaining amounts are attributed to the delivered items and are recognized when those items are delivered.

A portion of our sales are made through multi-year lease agreements. Under sales-type leases, we recognize revenue for our hardware and software products net of lease execution costs such as post-installation product maintenance and technical support, at the net present value of the lease payment stream once our installation obligations have been met. We optimize cash flows by selling a majority of our non-U.S. government leases to third-party leasing finance companies on a non-recourse basis. We have no obligation to the leasing company once the lease has been sold. Some of our sales-type leases, mostly those relating to U.S. government hospitals, are retained in-house. Interest income in these leases is recognized in product revenue using the interest method.

We recognize revenue on the sale of consumable blister cards when title and risk of loss to the products shipped has transferred to the customer. Revenue related to these products is reported net of discounts provided to customers.

Accounts receivable and notes receivable (net investment in sales type leases). We actively manage our accounts receivable to minimize credit risk. We typically sell to customers for which there is a history of successful collection. New customers are subject to a credit review process, which evaluates that customer’s financial position and ability to pay. We continually monitor and evaluate the collectability of our trade receivables based on a combination of factors. We record specific allowances for doubtful accounts when we become aware of a specific customer’s impaired ability to meet its financial obligation to us, such as in the case of bankruptcy filings or deterioration of financial position.

Uncollectible amounts are charged off against trade receivables and the allowance for doubtful accounts when we make a final determination there is no reasonable expectation of recovery. Estimates are used in determining our allowances for all other customers based on factors such as current trends, the length of time the receivables are past due and historical collection experience. While we believe that our allowance for doubtful accounts receivable is adequate and that the judgment applied is appropriate, such estimated amounts could differ materially from what will actually be uncollectible in the future.

The retained in-house leases discussed above are considered financing receivables. Our credit policies and evaluation of credit risk and write-off policies are applied alike to trade receivables and the net-investment in sales-type leases. For both, an account is generally past due after thirty days. The financing receivables also have customer-specific reserves for accounts identified for specific impairment and a non-specific reserve applied to the remaining population, based on factors such as current trends, the length of time the receivables are past due and historical collection experience. The retained in-house leases are not stratified by portfolio or class. Financing receivables which are reserved are generally transferred to cash-basis accounting so that revenue is recognized only as cash is received. However, the cash basis accounts continue to accrue interest.

Sales of accounts receivable. We record the sale of our accounts receivables as “true sales” in accordance with accounting guidance for transfers and servicing of financial assets. During the three months ended June 30, 2012 and 2011, we transferred non-recourse accounts receivable totaling $15.7 million and $12.2 million, respectively, which approximated fair value, to third-party leasing companies. During the six months ended June 30, 2012 and 2011, we transferred non-recourse accounts receivable totaling $27.8 million and $23.2 million, respectively, which approximated fair value, to third-party leasing companies. At June 30, 2012 and December 31, 2011, accounts receivable included $0.7 million and $0.2 million, respectively, due from third-party leasing companies for transferred non-recourse accounts receivable.

Concentration in revenues and in accounts receivable. There were no customers accounting for 10% or more of revenues in the three months ended June 30, 2012 or 2011. Additionally, there were no customers accounting for 10% or more of revenues in the six months ended June 30, 2012 or 2011. There were no customers accounting for 10% or more of accounts receivable at June 30, 2012 or at December 31, 2011.

Accounting policy for shipping costs. Outbound freight billed to customers is recorded as product revenue. The related shipping and handling cost is expensed as part of selling, general and administrative expense. Such shipping and handling expenses totaled $0.8 million and $0.8 million for the three months ended June 30, 2012 and 2011, respectively. Shipping and handling expenses totaled $1.5 million and $1.4 million for the six months ended June 30, 2012 and 2011, respectively

Dependence on suppliers. We have a supply agreement with one primary supplier for construction and supply of several sub-assemblies and inventory management of sub-assemblies used in our hardware products. There are no minimum purchase requirements. The contract may be terminated by either the supplier or by us without cause and at any time upon delivery of two months’ notice. Purchases from this supplier for the three months ended June 30, 2012 and 2011 were approximately $5.2 million and $5.7 million, respectively. Purchases from this supplier for the six months ended June 30, 2012 and 2011 were approximately $11.5 million and $11.2 million, respectively.

Income taxes. We record an income tax provision for the anticipated tax consequences of the reported results of operations. In accordance with GAAP, the provision for income taxes is computed using the asset and liability method, under which deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities, and for operating losses and tax credit carry forwards. Deferred tax assets and liabilities are measured using the enacted tax rates expected to apply in the periods in which those tax assets and liabilities are expected to be realized. In the event that we determine all or part of the net deferred tax assets are not realizable in the future, we will record a valuation allowance that would be charged to earnings in the period such determination is made.

In accordance with ASC 740, Tax Provisions, we recognize the tax benefit from an uncertain tax position if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such positions are then measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. The calculation of tax liabilities involves significant judgment in estimating the impact of uncertainties in the application of GAAP and complex tax laws. Resolution of these uncertainties in a manner inconsistent with management’s expectations could have a material impact on our financial condition and operating results.

We provide for income taxes for each interim period based on the estimated annual effective tax rate for the year, adjusting for discrete items in the quarter in which they arise. The annual effective tax rate before discrete items was 40.9% and 41.7% for the six months ended June 30, 2012 and 2011, respectively. The 2012 annual effective tax rate differed from the statutory rate of 35% primarily due to the unfavorable impact of state income taxes, non-deductible equity charges, and other non-deductible expenditures, which were partially offset by the domestic production activities deduction.

The 2011 annual effective tax rate differed from the statutory rate of 35%, primarily due to the unfavorable impact of state income taxes, non-deductible equity charges, and other non-deductible expenditures, which were partially offset by the federal research and development credit claimed and the domestic production activities deduction. Our effective tax rate, after discrete items, for the six months ended June 30, 2012 and 2011, was approximately 40.4% and 41.0%, respectively.

As of June 30, 2012, we had total gross unrecognized tax benefits of approximately $7.2 millioncompared with approximately $5.8 millionon December 31, 2011, representing an increase of approximately $1.4 millionduring the six months ended June 30, 2012. Approximately $1.0 million of the increase was attributable to unrecognized tax benefits recorded as part of the MTS acquisition. Of the total unrecognized tax benefits, $6.0 millionand $4.6 millionas of June 30, 2012 and  December 31, 2011 respectively, if recognized would reduce our effective tax rate in the period of recognition. Gross interest and penalty related to unrecognized tax benefit accrued was immaterial as of June 30, 2012 and December 31, 2011.

Recently adopted accounting pronouncements. In May 2011, the Financial Accounting Standards Board (“FASB”) issued ASU 2011-04, Fair Value Measurement, amending the fair value guidance in ASC 820, and thereby achieving substantially converged fair value measurement and disclosure requirements for GAAP and International Financial Reporting Standards (“IFRS”). The new guidance clarified some fair value measurement principles and expanded certain disclosure requirements. We adopted this guidance in the first quarter of 2012 without any impact to our financial position, operating results or cash flows.

XML

CONDENSED CONSOLIDATED BALANCE SHEETS (PARENTHETICAL) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011
Statement of Financial Position [Abstract]
Accounts receivable, allowances	$ 337	$ 443

XML

Contingencies

6 Months Ended

Jun. 30, 2012

Commitments and Contingencies Disclosure [Abstract]

Contingencies

Contingencies

Legal Proceedings    

We may from time to time become involved in certain legal proceedings in the ordinary course of business. We are not a party to any legal proceedings that management believes may have a material impact on Omnicell’s financial position or results of operations.

Guarantees

As permitted under Delaware law and our certificate of incorporation and bylaws, we have agreed to indemnify our directors and officers against certain losses that they may suffer by reason of the fact that such persons are, were or become our directors or officers. The term of the indemnification period is for the director’s or officer’s lifetime and there is no limit on the potential amount of future payments that we could be required to make under these indemnification agreements. We have purchased a directors’ and officers’ liability insurance policy that may enable us to recover a portion of any future payments that we may be required to make under these indemnification agreements. Assuming the applicability of coverage and the willingness of the insurer to assume coverage and subject to certain retention, loss limits and other policy provisions, we believe it is unlikely that we will be required to pay any material amounts pursuant to these indemnification obligations. However, no assurances can be given that the insurers will not attempt to dispute the validity, applicability or amount of coverage without expensive and time-consuming litigation against the insurers.

Additionally, we undertake indemnification obligations in our ordinary course of business in connection with, among other things, the licensing of our products and the provision of our support services. In the ordinary course of our business, we have in the past and may in the future agree to indemnify another party, generally our business affiliates or customers, against certain losses suffered or incurred by the indemnified party in connection with various types of claims, which may include, without limitation, claims of intellectual property infringement, certain tax liabilities, our gross negligence or intentional acts in the performance of support services and violations of laws. The term of these indemnification obligations is generally perpetual. In general, we attempt to limit the maximum potential amount of future payments that we may be required to make under these indemnification obligations to the amounts paid to us by a customer, but in some cases the obligation may not be so limited. In addition, we have in the past and may in the future warrant to our customers that our products will conform to functional specifications for a limited period of time following the date of installation (generally not exceeding 30 days) or that our software media is free from material defects. Sales contracts for certain of our medication packaging systems often include limited warranties for up to six months, but the periodic activity and ending warranty balances we record have historically been immaterial.

From time to time, we may also warrant that our professional services will be performed in a good and workmanlike manner or in a professional manner consistent with industry standards. We generally seek to disclaim most warranties, including any implied or statutory warranties such as warranties of merchantability, fitness for a particular purpose, title, quality and non-infringement, as well as any liability with respect to incidental, consequential, special, exemplary, punitive or similar damages. In some states, such disclaimers may not be enforceable. If necessary, we would provide for the estimated cost of product and service warranties based on specific warranty claims and claim history. We have not been subject to any significant claims for such losses and have not incurred any material costs in defending or settling claims related to these indemnification obligations. Accordingly, we believe it is unlikely that we will be required to pay any material amounts pursuant to these indemnification obligations or potential warranty claims and, therefore, no material liabilities have been recorded for such indemnification obligations as of June 30, 2012 or December 31, 2011.

XML

Document and Entity Information Document and Entity Information (USD $) In Millions, except Share data, unless otherwise specified	6 Months Ended
	Jun. 30, 2012	Aug. 01, 2012	Jun. 30, 2011
Entity Information [Line Items]
Entity Registrant Name	OMNICELL, Inc
Entity Central Index Key	0000926326
Document Type	10-Q
Document Period End Date	Jun. 30, 2012
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Accelerated Filer
Entity Public Float			$ 497.7
Entity Common Stock, Shares Outstanding		33,301,933
Document Fiscal Year Focus	2012
Document Fiscal Period Focus	Q2

XML

Stockholders' Equity

6 Months Ended

Jun. 30, 2012

Stockholders' Equity Note [Abstract]

Stockholders' Equity

Stockholders’ Equity

Treasury Stock

In February 2008, our Board of Directors authorized a stock repurchase program for the repurchase of up to $90.0 million of our common stock. All repurchased shares were recorded as treasury stock and were accounted for under the cost method. No repurchased shares have been retired. The timing, price and volume of the repurchases have been based on market conditions, relevant securities laws and other factors. The stock repurchase program does not obligate us to repurchase any specific number of shares, and we may terminate or suspend the repurchase program at any time.

During the three months ended June 30, 2012, we repurchased 505,137 shares through the stock repurchase program at an average cost of $13.98 per share, including commissions, compared to zero shares repurchased in the three months ended March 31, 2012. We repurchased 218,075 shares through the stock repurchase program in the three months ended June 30, 2011 at an average cost of $15.00 per share, including commissions, and repurchased 559,175 shares at an average cost of $14.31, including commissions, in the six months ended June 30, 2011.

From the inception of the program in February 2008 through June 30, 2012, we have repurchased a total of 5,460,944 shares at an average cost of $15.51 per share through open market purchases. As of June 30, 2012, we had $5.3 million of remaining authorized funds to repurchase additional shares under the stock repurchase program. Please refer to Note 17, “Subsequent Events,” for recent share repurchase activity.

XML

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Revenues:
Product revenues	$ 59,269	$ 46,218	$ 107,793	$ 88,793
Services and other revenues	16,115	14,787	31,734	29,372
Total revenues	75,384	61,005	139,527	118,165
Cost of revenues:
Cost of product revenues	28,600	19,730	48,896	37,566
Cost of services and other revenues	7,408	7,468	15,506	15,142
Total cost of revenues	36,008	27,198	64,402	52,708
Gross profit	39,376	33,807	75,125	65,457
Operating expenses:
Research and development	5,499	5,280	11,993	10,120
Selling, general and administrative	31,446	24,297	57,066	50,078
Total operating expenses	36,945	29,577	69,059	60,198
Income from operations	2,431	4,230	6,066	5,259
Interest and other income (expense), net	(73)	71	23	125
Income before provision for income taxes	2,358	4,301	6,089	5,384
Provision for income taxes	983	1,714	2,363	2,127
Net income	$ 1,375	$ 2,587	$ 3,726	$ 3,257
Net income per share:
Net income per share-basic	$ 0.04	$ 0.08	$ 0.11	$ 0.10
Net income per share - diluted	$ 0.04	$ 0.08	$ 0.11	$ 0.10
Weighted average shares outstanding:
Basic (in shares)	33,390	33,003	33,377	33,093
Diluted (in shares)	34,316	33,981	34,329	34,039

XML

Net Investment in Sales-Type Leases

6 Months Ended

Jun. 30, 2012

Net Investment in Sales-Type Leases Disclosure

Net Investment Sales-Type Leases Disclosure [Text Block]

Net Investment in Sales-Type Leases

Our sales-type leases are for terms generally ranging up to five years. Sales-type lease receivables are collateralized by the underlying equipment. The components of our net investment in sales-type leases are as follows (in thousands):

	June 30, 2012		December 31, 2011
Net minimum lease payments to be received	$	15,328	$	15,063
Less unearned interest income portion	1,113		1,229
Net investment in sales-type leases	14,215		13,834
Less current portion(1)	4,389		5,049
Non-current net investment in sales-type leases(2)	$	9,826	$	8,785

(1) A component of other current assets. This amount is net of allowance for doubtful accounts of $0.5 million as of June 30, 2012 and $0.1 million as of December 31, 2011.

(2) Net of allowance for doubtful accounts of $0.1 million as of June 30, 2012 and $0.1 million as of December 31, 2011.

The minimum lease payments under sales-type leases as of June 30, 2012 were as follows (in thousands):

2012 (remaining six months)	$	2,559
2013	4,601
2014	3,512
2015	2,516
2016	1,573
2017	567
Thereafter	—
Total	$	15,328

The following table summarizes the credit losses and recorded investment in sales-type leases, excluding unearned interest, as of June 30, 2012 and December 31, 2011 (in thousands):

	Allowance for Credit Losses		Recorded Investment in Sales-type Leases Gross		Recorded Investment in Sales-type Leases Net
Credit loss disclosure for June 30, 2012 :
Accounts individually evaluated for impairment	$	544	$	544	$	—
Accounts collectively evaluated for impairment	115		14,330		14,215
Ending balances: June 30, 2012	$	659	$	14,874	$	14,215
Credit loss disclosure for December 31, 2011 :
Accounts individually evaluated for impairment	$	178	$	178	$	—
Accounts collectively evaluated for impairment	106		13,940		13,834
Ending balances: December 31, 2011	$	284	$	14,118	$	13,834

The following table summarizes the activity for the allowance for credit losses for the investment in sales-type leases for the three months and six months ended June 30, 2012 and 2011 (in thousands):

	Three Months Ended June 30,						Six Months Ended June 30,
	2012			2011			2012			2011
Allowance for credit losses, beginning of period	$	257		$	380		$	284		$	411
Current period provision (reversal)	422			(5		)	422			(9		)
Direct write-downs charged against the allowance	—			—			—			—
Recoveries of amounts previously charged off	(20		)	(22		)	(47		)	(49		)
Allowance for credit losses, end of period	$	659		$	353		$	659		$	353

XML

Property and Equipment

6 Months Ended

Jun. 30, 2012

Property, Plant and Equipment [Abstract]

Property and Equipment

Property and Equipment

Property and equipment consist of the following (in thousands):

	June 30, 2012			December 31, 2011
Equipment	$	35,322		$	25,101
Furniture and fixtures	2,256			1,811
Leasehold improvements	4,196			3,692
Purchased software	21,264			20,641
Capital in process	2,391			2,283
	65,429			53,528
Accumulated depreciation and amortization	(36,464		)	(36,222		)
Property and equipment, net	$	28,965		$	17,306

Depreciation and amortization of property and equipment totaled approximately $1.9 million and $1.4 million for the three months ended June 30, 2012 and 2011, respectively. Depreciation and amortization of property and equipment totaled approximately $3.5 million and $2.8 million for the six months ended June 30, 2012 and 2011, respectively.

XML

Subsequent Event

6 Months Ended

Jun. 30, 2012

Subsequent Events [Abstract]

Subsequent Event

Subsequent Events

Treasury Stock Repurchase

In 2008, our Board of Directors established the “2008 Repurchase Program,” authorizing share repurchases of $90.0 million. Subsequent to June 30, 2012, we have continued with share repurchases. Through the date of this filing, $1.1 million remains authorized for future share repurchases due to 314,100 shares repurchased since June 30, 2012, at an average cost of $13.39 per share, including commissions.

On August 1, 2012, our Board of Directors established a new “2012 Repurchase Program”, authorizing share repurchases of $50.0 million, with no termination date. The timing, price and volume of repurchases will be based on market conditions, relevant securities laws and other factors. The stock repurchases may be made from time to time on the open market, in privately negotiated transactions or pursuant to a Rule 10b-18 plan. The stock repurchase program does not obligate the Company to repurchase any specific number of shares, and the Company may terminate or suspend the repurchase program at any time.

XML

Stock Option Plans and Share-Based Compensation

6 Months Ended

Jun. 30, 2012

Stock Option Plans and Share-Based Compensation [Abstract]

Stock Option Plans and Share-Based Compensation

Stock Option Plans and Share-Based Compensation

Stock Option Plans

At June 30, 2012, a total of 1,881,980 shares of common stock were reserved for future issuance under our 2009 Equity Incentive Plan (the “2009 Plan”). At June 30, 2012, $6.9 million of total unrecognized compensation cost related to non-vested stock options was expected to be recognized over a weighted average period of 2.8 years.

A summary of aggregate option activity for the six months ended June 30, 2012 is presented below:

Options:	Number of Shares		Weighted- Average Exercise Price
	(in thousands)
Outstanding at December 31, 2011	4,693		$	13.36
Granted	390		$	15.28
Exercised	(219	)	$	9.17
Forfeited	(44	)	$	13.23
Expired	(81	)	$	21.65
Outstanding at June 30, 2012	4,739		$	13.57
Exercisable at June 30, 2012	3,565		$	13.46

Restricted Stock and Time-based Restricted Stock Units

The non-employee members of our Board of Directors are granted restricted stock on the day of our annual meeting of stockholders and such shares of restricted stock vest on the date of the subsequent year’s annual meeting of stockholders, provided such non-employee director remains a director on such date. Restricted stock units (“RSUs”) are granted to certain of our employees and generally vest over a period of four years and are expensed ratably on a straight-line basis over the vesting period. The fair value of both restricted stock and RSUs granted pursuant to our stock option plans is the product of the number of shares granted and the grant date fair value of our common stock. Our unrecognized compensation cost related to non-vested restricted stock at June 30, 2012 was approximately $0.8 million and is expected to be recognized over a weighted-average period of 0.9 years. Expected future compensation expense relating to RSUs outstanding on June 30, 2012 is $5.3 million over a weighted-average period of 2.8 years.

A summary of activity of both restricted stock and RSUs for the six months ended June 30, 2012 is presented below:

	Restricted Stock				Restricted Stock Units
			Weighted -				Weighted -
	Number of Shares		Average Grant Date Fair Value Per Share		Number of Shares		Average Grant Date Fair Value Per Share
	(in thousands)				(in thousands)
Non-vested, December 31, 2011	68		$	14.71	287		$	13.03
Granted	67		$	14.19	197		$	14.82
Vested	(68	)	$	14.71	(73	)	$	12.81
Forfeited	—		—		(13	)	$	14.51
Non-vested, June 30, 2012	67		$	14.19	398		$	13.90

Performance-based Restricted Stock Units

In 2011, we began incorporating performance-based restricted stock units (“PSUs”) as an element of our executive compensation plans. Our unrecognized compensation cost related to non-vested performance-based restricted stock units at June 30, 2012 was approximately $1.2 million and is expected to be recognized over a weighted-average period of 1.7 years.

The accounting guidance for awards with market conditions differs from that for awards with service conditions only or service and performance conditions. Because the grant date fair value of an award containing market conditions is calculated as the expected value, averaging over all possible outcomes, the measured expense is amortized over the service period, regardless of whether the market condition is ever actually met. PSU expense of $0.3 million and $0.1 million was recognized for the three months ended June 30, 2012 and 2011, respectively. PSU expense of $0.5 million and $0.3 million was recognized for the six months ended June 30, 2012 and 2011, respectively.

The fair value of a PSU award is the average of trial-specific values of the award over each of one million Monte Carlo trials. Each trial-specific value is the market value of the award at the end of the one-year performance period discounted back to the grant date. The market value of the award for each trial at the end of the performance period is the product of (a) the per share value of Omnicell stock at the end of the performance period and (b) the number of shares that vest. The number of shares that vest at the end of the performance period depends on the percentile ranking of the total shareholder return for Omnicell stock over the performance period relative to the total shareholder return of each of the other companies in the Index as shown in the tables below.

Vesting for the PSU awards is based on the percentile placement of our total shareholder return among the companies listed in the NASDAQ Healthcare Index (the “Index”) and time-based vesting. We calculate total stockholder return based on the one year annualized rates of return reflecting price appreciation plus reinvestment of dividends. Stock price appreciation is calculated based on the average closing prices of the applicable company’s common stock for the 20 trading days ending on the last trading day of the year prior to the date of grant as compared to the average closing prices for the 20 trading days ended on the last trading day of the year of grant.

The following table shows the percent of PSUs granted in 2011 eligible for further time-based vesting based on our percentile placement:

Percentile Placement of Our Total Shareholder Return	% of PSUs Eligible for Time- Based Vesting
Below the 35th percentile	—%
At least the 35th percentile, but below the 50th percentile	50%
At least the 50th percentile, but below the 65th percentile	100%
At least the 65th percentile, but below the 75th percentile (1)	110% to 119%
At or above the 75th percentile	120%

(1)The actual percentage of PSUs eligible for further time-based vesting is based on straight-line interpolation, where, for example, if the ranking is the 70th percentile, then the vesting percentage is 115%.

On January 17, 2012, the Compensation Committee of our Board of Directors confirmed 76.3% as the percentile rank of Omnicell’s 2011 total stockholder return. This resulted in 120% of the 2011 PSU awards, or 120,000 shares, becoming eligible for further time-based vesting. The eligible PSU awards will vest as follows: 25% of the eligible awards for the first year vested immediately on January 17, 2012 with the remaining eligible awards vesting in equal increments, semi-annually, over the subsequent 36 month period beginning on June 15th and December 15th of the year after the date of grant and each subsequent year. Vesting is contingent upon continued service.

The following table shows the percent of PSUs granted in 2012 eligible for further time-based vesting based on our percentile placement:

Percentile Placement of Our Total Shareholder Return	% of PSUs Eligible for Time- Based Vesting
Below the 35th percentile	—%
At least the 35th percentile, but below the 50th percentile	50%
At least the 50th percentile	100%

After the last trading day of 2012, the Compensation Committee of our Board of Directors will determine the percentile rank of Omnicell’s total stockholder return and the number of performance-based restricted stock unit awards eligible for further time-based vesting. The eligible performance-based restricted stock unit awards will vest as follows: 25% of the shares on the date of the Compensation Committee of our Board of Directors meeting in 2013 when the Committee reviews the performance-based metrics and determines if they were met or not, with the remaining shares vesting on a semi-annual basis over a period of 36 months commencing on June 15, 2013 if Omnicell meets certain stock performance objectives compared to the Index. The actual number of shares that vest may be 0% to 100% of the numbers reflected above, depending upon Omnicell’s performance. Vesting is contingent upon continued service.

During the six months ended June 30, 2012, in addition to the 125,000 PSUs granted in 2012, an additional 7,500 PSUs vested as a result of Omnicell’s 2011 total stockholder return which caused 120% of the 2011 PSUs to become eligible for further time-based vesting.

A summary of activity of the PSUs for the six months ended June 30, 2012 is presented below:

			Weighted - Average Grant Date Fair Value Per
Performance-based Stock Units	Number of Shares		Share
	(in thousands)
Non-vested, December 31, 2011	100		$	11.15
Granted	133		$	10.94
Vested	(45	)	$	11.15
Forfeited	—		—
Non-vested, June 30, 2012	188		$	11.00

Employee Stock Purchase Plan

We have an Employee Stock Purchase Plan (“ESPP”), under which employees can purchase shares of our common stock based on a percentage of their compensation, but not greater than 15% of their earnings, up to a maximum of $25,000 of fair value per year. The purchase price per share must be equal to the lower of 85% of the fair value of the common stock at the beginning of a 24-month offering period or the end of each six-month purchasing period. As of June 30, 2012, 3,602,826 shares had been issued under the ESPP. As of June 30, 2012 there were a total of 1,728,729 shares reserved for future issuance under the ESPP. For the three months and six months ended June 30, 2012, no shares and 197,831 shares, respectively, of common stock were purchased under the ESPP.

Share-based Compensation

We account for share-based awards granted to employees and directors, including employee stock option awards, restricted stock, PSUs and RSUs issued pursuant to the 2009 Plan and employee stock purchases made under our ESPP using the estimated grant date fair value method of accounting in accordance with ASC 718, Stock Compensation. We value options and ESPP shares using the Black-Scholes-Merton option-pricing model. Restricted stock and time-based RSUs are valued at the grant date fair value of the underlying common shares. The PSUs are valued via Monte Carlo simulation, as described above.

The impact on our results for share-based compensation for the three months and six months ended June 30, 2012 and 2011 was as follows (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2012		2011		2012		2011
Cost of product and service revenues	$	233	$	383	$	501	$	750
Research and development expenses	211		345		454		672
Selling, general and administrative expenses	1,769		1,723		3,465		3,421
Total share-based compensation expenses	$	2,213	$	2,451	$	4,420	$	4,843

XML

Deferred Gross Profit

6 Months Ended

Jun. 30, 2012

Deferred Gross Profit[Abstract]

Deferred Gross Profit [Text Block]

Deferred Gross Profit

Deferred gross profit consists of the following (in thousands):

	June 30, 2012			December 31, 2011
Sales of medication and supply dispensing systems and packaging equipment,  which have been delivered and invoiced but not yet installed	$	23,463		$	24,181
Cost of revenues, excluding installation costs	(8,985		)	(9,971		)
Deferred gross profit	$	14,478		$	14,210

XML

Commitments supplier obligation (Details) (USD $) In Millions, unless otherwise specified	Jun. 30, 2012
Commitments [Abstract]
Purchase Commitment, Remaining Minimum Amount Committed	$ 7.3

XML

Goodwill and Other Intangible Assets

6 Months Ended

Jun. 30, 2012

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Other Intangible Assets

Goodwill and Other Intangible Assets

Under ASC 350, Intangibles - Goodwill and Other, goodwill and intangible assets with an indefinite life are not subject to amortization. Rather, we evaluate these assets for impairment at least annually or more frequently if events or changes in circumstances suggest that the carrying amount may not be recoverable. Historically, there has been no cumulative impairment of goodwill.

Activity in Goodwill by reporting units, which are the same as our operating segments, for the six months ended June 30, 2012 consists of the following (in thousands):

	Goodwill at December 31, 2011		Goodwill acquired		Other adjustments		Goodwill at June 30, 2012
Reporting units:
Acute Care	$	28,543	$	—	$	—	$	28,543
Non-Acute Care	—		84,491		—		84,491
Total	$	28,543	$	84,491	$	—	$	113,034

The goodwill acquired reflects the May 21, 2012 acquisition of MedPak by Omnicell. MedPak is the parent company of MTS, a worldwide provider of medication adherence packaging systems. The acquired goodwill was assigned to the new reporting unit called Non-Acute Care, created as a result of the MTS acquisition.

There were no indefinite-life intangibles at either June 30, 2012 or December 31, 2011. Other finite-life intangible assets at these dates consist of the following (in thousands):

	June 30, 2012						December 31, 2011
	Gross				Net		Gross				Net
	Carrying Amount		Accumulated Amortization		Carrying Amount		Carrying Amount		Accumulated Amortization		Carrying Amount		Amortization Life
Finite-lived intangibles:
Customer relationships	$	54,330	$	2,003	$	52,327	$	4,230	$	1,591	$	2,639	5-30 years
Acquired technology	27,580		393		27,187		980		175		805		3-20 years
Patents	1,138		210		928		889		190		699		20 years
Trade name	6,890		115		6,775		90		37		53		3-12 years
Non-compete agreements	60		35		25		60		25		35		3 years
Total finite-lived intangibles	$	89,998	$	2,756	$	87,242	$	6,249	$	2,018	$	4,231

Amortization expense totaled $0.6 million and $0.2 million for the three months ended June 30, 2012 and 2011, respectively. Amortization expense totaled $0.7 million and $0.3 million for the six months ended June 30, 2012 and 2011, respectively. The amortization of acquired technology is included within product cost of sales; other acquired intangibles are usually amortized within selling, general and administrative expenses.

Estimated annual expected amortization expense of the finite-lived intangible assets at June 30, 2012 is as follows (in thousands):

2012 (remaining six months)	$	2,124
2013	4,235
2014	4,195
2015	4,172
2016	3,821
2017	3,786
Thereafter	64,909
Total	$	87,242

XML

Accrued Liabilities

6 Months Ended

Jun. 30, 2012

Accrued Liabilities, Current [Abstract]

Accrued Liabilities [Text Block]

Accrued Liabilities

Accrued liabilities consist of the following (in thousands):

	June 30, 2012		December 31, 2011
Advance payments from customers	$	2,805	$	3,390
Accrued Group Purchasing Organization (GPO) fees	2,055		2,437
Acquisition consideration payable	1,833		—
Rebates and lease buyouts	1,125		1,748
Taxes payable	527		925
Other	1,611		401
Total	$	9,956	$	8,901

XML

Commitments

6 Months Ended

Jun. 30, 2012

Commitments

Commitments Disclosure [Text Block]

Commitments

At June 30, 2012, the minimum payments under our operating leases for each of the five succeeding fiscal years are as follows (in thousands):

2012 (remaining six months)	$	2,978
2013	5,154
2014	5,272
2015	5,183
2016	4,898
2017	4,206
Thereafter	20,430
Total	$	48,121

Commitments under operating leases relate primarily to leasehold property and office equipment.

 In October 2011, we entered into a lease agreement for approximately 100,000 square feet of office space. Pursuant to the lease agreement, the landlord will construct a single, three-story building of rentable space located at 590 Middlefield Road in Mountain View, California which we will subsequently lease and which will serve as our headquarters. The term of the lease agreement is for a period of 10 years, expected to commence November 2012, with a base lease commitment of approximately $40.0 million. We have two options to extend the term of the lease agreement at market rates. Each extension is for an additional 60 month term.

In March 2012, we entered into a lease agreement for approximately 46,000 square feet of manufacturing, distribution and office space located at 735 Sycamore Drive in Milpitas, California. The term of the lease agreement is for a period of 60 months, expected to commence approximately October 2012, with a base lease commitment of approximately $1.8 million and a single 60 month extension option.

Coincident with the May 21, 2012 acquisition of MTS, we assumed responsibility for its 132,500 square feet of manufacturing, warehousing and office space in St. Petersburg, Florida. The remaining term of the original 12 year lease agreement is through September 30, 2016 with a remaining base lease commitment of approximately $3.9 million. We have two options to extend the term of the lease agreement at market rates. Each extension is for an additional 60 month term.

In Leeds, United Kingdom, MTS leases an office and distribution center. The remaining term of the original 10 year lease agreement is through June 8, 2021, with no extension options. The remaining base lease commitment, converted from British Pounds at the current conversion rate, is approximately $1.2 million. MTS also has smaller rented offices in Strongsville, Ohio and Germany.

We purchase components from a variety of suppliers and use contract manufacturers to provide manufacturing services for our products. During the normal course of business, we issue purchase orders with estimates of our requirements several months ahead of the delivery dates. Our near-term commitments to our contract manufacturers and suppliers totaled $7.3 million as of June 30, 2012.

At June 30, 2012, we have recorded $3.0 million for uncertain tax positions under long term liabilities, in accordance with GAAP, summarized under Note 1, “Organization and Summary of Significant Accounting Policies.” As these liabilities do not reflect actual tax assessments, the timing and amount of payments we might be required to make will depend upon a number of factors. Accordingly, as the timing and amount of payment cannot be estimated, the current balance of the uncertain tax position liabilities has not been included in the table of commitments above.

XML

Stock Option Plans and Share-Based Compensation Stock option rollforward YTD (Details) (USD $) In Millions, except Share data, unless otherwise specified	6 Months Ended
	Jun. 30, 2012
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common Stock, Capital Shares Reserved for Future Issuance	1,881,980
Employee Stock Option [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized	$ 6.9
Options, shares outstanding- Period start	4,693,000
Options, Outstanding, Wtd Avg Exercise Price - Period start	$ 13.36
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross	390,000
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price	$ 15.28
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period	(219,000)
Share-based Compensation Arrangements by Share-based Payment Award, Options, Exercises in Period, Weighted Average Exercise Price	$ 9.17
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures and Expirations in Period	(44,000)
Share-based Compensation Arrangements by Share-based Payment Award, Options, Forfeitures in Period, Weighted Average Exercise Price	$ 13.23
Share-based Compensation Arrangement by Share-based Payment Award, Options, Expirations in Period	(81,000)
Share-based Compensation Arrangements by Share-based Payment Award, Options, Expirations in Period, Weighted Average Exercise Price	$ 21.65
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Number	3,565,000
Options, shares outstanding- Period end	4,739,000
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Weighted Average Exercise Price	$ 13.46
Options, Outstanding, Wtd Avg Exercise Price - Period end	$ 13.57
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized, Period for Recognition	2 years 9 months 4 days

XML

Stock Option Plans and Share-Based Compensation Perfromance based stock units (PSU) (Details) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011	Dec. 31, 2011
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Allocated Share-based Compensation Expense	$ 2,213,000	$ 2,451,000	$ 4,420,000	$ 4,843,000
Performance Shares [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized, Share-based Awards Other than Options	1,200,000		1,200,000
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number	188,000		188,000		100,000
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value	$ 11.00		$ 11.00		$ 11.15
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period			133,000
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period			(45,000)
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value			$ 10.94
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period, Weighted Average Grant Date Fair Value			$ 11.15
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeited in Period			0
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeitures, Weighted Average Grant Date Fair Value			$ 0.00
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized, Period for Recognition			1 year 8 months 5 days
Allocated Share-based Compensation Expense	$ 300,000	$ 100,000	$ 500,000	$ 300,000
PSU program year one [Member] | Performance Shares [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Period for remaining award to vest semi-annually				36 months
PSU shares granted and vested in subsequent year due to above-par realization of performance				7,500
PSU Program Year Two [Member] | Performance Shares [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Period for remaining award to vest semi-annually				36 months
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period				125,000

XML

Stockholders' Equity (Details) (USD $)	3 Months Ended			6 Months Ended		53 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Mar. 31, 2011	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012
Stockholders' Equity Note [Abstract]
Stock Repurchase Program, Authorized Amount				$ 90,000,000
Stock Repurchased and Retired During Period, Shares						0
Treasury Stock, Shares, Acquired	505,137	218,075	0		559,175
Treasury Stock Acquired, Average Cost Per Share	$ 13.98	$ 15.00			$ 14.31	$ 15.51
Shares Repurchased to date						5,460,944
Share Repurchase - remaining funds authorized	$ 5,300,000			$ 5,300,000		$ 5,300,000

XML

Stock Option Plans and Share-Based Compensation (Tables)

6 Months Ended

Jun. 30, 2012

Stock Option Plans and Share-Based Compensation [Abstract]

Schedule of Stock Options Roll Forward [Table Text Block]

A summary of aggregate option activity for the six months ended June 30, 2012 is presented below:

Options:	Number of Shares		Weighted- Average Exercise Price
	(in thousands)
Outstanding at December 31, 2011	4,693		$	13.36
Granted	390		$	15.28
Exercised	(219	)	$	9.17
Forfeited	(44	)	$	13.23
Expired	(81	)	$	21.65
Outstanding at June 30, 2012	4,739		$	13.57
Exercisable at June 30, 2012	3,565		$	13.46

Schedule of Share-based Compensation, Restricted Stock and Restricted Stock Units Activity [Table Text Block]

A summary of activity of both restricted stock and RSUs for the six months ended June 30, 2012 is presented below:

	Restricted Stock				Restricted Stock Units
			Weighted -				Weighted -
	Number of Shares		Average Grant Date Fair Value Per Share		Number of Shares		Average Grant Date Fair Value Per Share
	(in thousands)				(in thousands)
Non-vested, December 31, 2011	68		$	14.71	287		$	13.03
Granted	67		$	14.19	197		$	14.82
Vested	(68	)	$	14.71	(73	)	$	12.81
Forfeited	—		—		(13	)	$	14.51
Non-vested, June 30, 2012	67		$	14.19	398		$	13.90

PSU % eligible vesting vs total Shareholder Return placement - First year [Table Text Block]

The following table shows the percent of PSUs granted in 2011 eligible for further time-based vesting based on our percentile placement:

Percentile Placement of Our Total Shareholder Return	% of PSUs Eligible for Time- Based Vesting
Below the 35th percentile	—%
At least the 35th percentile, but below the 50th percentile	50%
At least the 50th percentile, but below the 65th percentile	100%
At least the 65th percentile, but below the 75th percentile (1)	110% to 119%
At or above the 75th percentile	120%

(1)The actual percentage of PSUs eligible for further time-based vesting is based on straight-line interpolation, where, for example, if the ranking is the 70th percentile, then the vesting percentage is 115%.

PSU % eligible vesting vs Total Shareholder Return - Second year [Table Text Block]

The following table shows the percent of PSUs granted in 2012 eligible for further time-based vesting based on our percentile placement:

Percentile Placement of Our Total Shareholder Return	% of PSUs Eligible for Time- Based Vesting
Below the 35th percentile	—%
At least the 35th percentile, but below the 50th percentile	50%
At least the 50th percentile	100%

Schedule of Nonvested Performance-based Units Activity [Table Text Block]

A summary of activity of the PSUs for the six months ended June 30, 2012 is presented below:

			Weighted - Average Grant Date Fair Value Per
Performance-based Stock Units	Number of Shares		Share
	(in thousands)
Non-vested, December 31, 2011	100		$	11.15
Granted	133		$	10.94
Vested	(45	)	$	11.15
Forfeited	—		—
Non-vested, June 30, 2012	188		$	11.00

Schedule of Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Table Text Block]

The impact on our results for share-based compensation for the three months and six months ended June 30, 2012 and 2011 was as follows (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2012		2011		2012		2011
Cost of product and service revenues	$	233	$	383	$	501	$	750
Research and development expenses	211		345		454		672
Selling, general and administrative expenses	1,769		1,723		3,465		3,421
Total share-based compensation expenses	$	2,213	$	2,451	$	4,420	$	4,843

XML

Goodwill and Other Intangible Assets Goodwill rollforward by segment (details) (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2012
Goodwill [Roll Forward]
Goodwill, Beginning balance	$ 28,543	[1]
Goodwill acquired	84,491
Other adjustments	0
Goodwill, Ending balance	113,034
Acute care systems [Member]
Goodwill [Roll Forward]
Goodwill, Beginning balance	28,543
Goodwill acquired	0
Other adjustments	0
Goodwill, Ending balance	28,543
long term care solutions [Member]
Goodwill [Roll Forward]
Goodwill, Beginning balance	0
Goodwill acquired	84,491
Other adjustments	0
Goodwill, Ending balance	$ 84,491

[1] Information derived from our December 31, 2011 audited Consolidated Financial Statements.

XML

Segments

6 Months Ended

Jun. 30, 2012

Segments [Abstract]

Segment Reporting Disclosure [Text Block]

Segments

Beginning with the May 21, 2012 acquisition of MTS, we have organized our business into two operating business segments: Acute Care, which primarily includes products and services sold to hospital customers and Non-Acute Care, which primarily includes products and services sold to customers outside of hospital settings.

The Acute Care segment is organized around the design, manufacturing, selling and servicing of medication and supply dispensing systems. The Non-Acute Care segment includes primarily the manufacturing and selling of consumable medication blister cards, packaging equipment and ancillary products and services. We report segment information based on the management approach. The management approach designates the internal reporting used by the Chief Operating Decision Maker (“CODM”), for making decisions and assessing performance as the source of our operating segments. The CODM is our Chief Executive Officer. The CODM allocates resources to and assesses the performance of each operating segment using information about its revenues, gross profit and income (loss) from operations.

Since 1992, Omnicell has provided automation and business information solutions to acute care hospitals. We have developed product solutions that help optimize various workflows utilized in hospitals. We have also developed sophisticated sales, installation, and service capabilities to serve the specific and special needs of the acute care environment in hospitals. As the acute care market evolves, we see opportunities to provide medication adherence solutions, which were added to our product line through the acquisition of MTS, to the acute care market as well. A portion of our organization structure and management processes will continue to be structured to optimize sales and service of solutions to the acute care market.

Since 1984, MTS has provided medication adherence solutions to the non-acute care market. These solutions provide automated and semi-automated equipment to assist institutional and retail pharmacists in filling medication orders into blister cards, the primary method of medication control in non-acute care settings. Completing the product solution are the consumables used by institutional and retail pharmacists to make the medication adherence package. MTS has developed process manufacturing capabilities as well as sales capabilities to market medication adherence solutions to institutional and retail pharmacies. A portion of our organization structure and management processes will continue to be structured to optimize the product, sales, and service of solutions to the non-acute care market.

We believe that legislative changes and economic pressures to manage costs will cause healthcare organizations to manage the health of patients across the continuum of care regardless of the setting in which the care is provided. We believe we have the capabilities and market position to provide the tools needed by our customers to manage medications across the continuum of care. But we also believe that the inherent differences between medication management workflows in acute care settings and non-acute care settings will cause our product solutions and marketing strategies to be managed separately for these two customer segments.

For the three months and six months ended June 30, 2012 and 2011, the contributions of our segments to net revenues and income (loss) from operations, and the reconciliation to total net income, is as follows (amounts in thousands):

	Three Months Ended June 30,									Three Months Ended June 30,
	2012									2011
	Acute Care			Non-Acute Care (1)			Total			Acute Care			Total
Net revenues from external customers	$	66,528		$	8,856		$	75,384		$	61,005		$	61,005
Cost of revenues	29,158			6,850			36,008			27,198			27,198
Gross profit	$	37,370		$	2,006		$	39,376		$	33,807		$	33,807
Gross margin %	56.2		%	22.7		%	52.2		%	55.4		%	55.4		%
Operating expenses	33,458			3,487			36,945			29,577			29,577
Income from operations	$	3,912		$	(1,481	)	$	2,431		$	4,230		$	4,230
Operating margin %	5.9		%	(16.7		)%	3.2		%	6.9		%	6.9		%
Interest and other income (expense), net							(73		)				71
Income before provision for income taxes							2,358						4,301
Provision for income taxes							983						1,714
Net income							$	1,375					$	2,587
(1) Non-Acute Care segment included from the May 21, 2012 acquisition of MTS

	Six Months Ended June 30,									Six Months Ended June 30,
	2012									2011
	Acute Care			Non-Acute Care (1)			Total			Acute Care			Total
Net revenues from external customers	$	130,671		$	8,856		$	139,527		$	118,165		$	118,165
Cost of revenues	57,552			6,850			64,402			52,708			52,708
Gross profit	$	73,119		$	2,006		$	75,125		$	65,457		$	65,457
Gross margin %	56.0		%	22.7		%	53.8		%	55.4		%	55.4		%
Operating expenses	65,572			3,487			69,059			60,198			60,198
Income from operations	$	7,547		$	(1,481	)	$	6,066		$	5,259		$	5,259
Operating margin %	5.8		%	(16.7		)%	4.3		%	4.5		%	4.5		%
Interest and other income (expense), net							23						125
Income before provision for income taxes							6,089						5,384
Provision for income taxes							2,363						2,127
Net income							$	3,726					$	3,257
(1) Non-Acute Care segment included from the May 21, 2012 acquisition of MTS

For the three months and the six months ended June 30, 2012, the Non-Acute Care cost of revenues included $1.7 million of acquisition-related charges primarily associated with the step-up to the estimated fair value of inventory acquired from MTS and consumed in the normal manufacturing cycle of our business. The Non-Acute Care operating expenses included $0.9 million of acquisition-related charges primarily associated with severance expenses. For the three months and the six months ended June 30, 2012, the Acute Care operating expenses included $2.3 million of acquisition-related charges for transaction costs, required to be expensed under ASC 805 Business Combinations.

As of June 30, 2012 we have not assigned assets to our operating segments.

XML

Cash and Cash Equivalents, Short-term Investments and Fair Value of Financial Instruments (Tables)

6 Months Ended

Jun. 30, 2012

Cash and Cash Equivalents [Abstract]

Schedule of Cash, Cash Equivalents and Short-term Investments [Table Text Block]

Cash and cash equivalents and short-term investments consist of the following significant investment asset classes, with disclosure of amortized cost, gross unrealized gains and losses, and fair value as of June 30, 2012 and December 31, 2011 (in thousands):

	June 30, 2012
	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value		Cash / Cash Equivalents		Short-term Investments		Security Classification (1)
Cash	$	20,443	$	—	$	—	$	20,443	$	20,443	$	—	N/A
Money market funds	33,628		—		—		33,628		33,628		—		Available for sale
Total cash, cash equivalents and short-term investments	$	54,071	$	—	$	—	$	54,071	$	54,071	$	—

	December 31, 2011
	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value		Cash / Cash Equivalents		Short-term Investments		Security Classification
Cash	$	14,452	$	—	$	—	$	14,452	$	14,452	$	—	N/A
Money market funds	177,310		—		—		177,310		177,310		—		Available for sale
Non-U.S. government securities	8,106		1		—		8,107		—		8,107		Available for sale
Total cash, cash equivalents and short-term investments	$	199,868	$	1	$	—	$	199,869	$	191,762	$	8,107

Fair Value, Assets Measured on Recurring Basis [Table Text Block]

The following table displays the financial assets measured at fair value, on a recurring basis, with money market funds recorded within cash and cash equivalents and non-U.S Government securities in short-term investments (in thousands):

	Quoted Prices in Active Markets for Identical Instruments (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)	Total Fair Value
At June 30, 2012
Money market funds	$	33,628	$	—	—	$	33,628
Total	$	33,628	$	—	—	$	33,628
At December 31, 2011
Money market funds	$	177,310	—		—	$	177,310
Non U.S. Government securities	—		$	8,107	—	8,107
Total	$	177,310	$	8,107	—	$	185,417

XML

Net Investment in Sales-Type Leases Credit loss balances by evaluation method for impairment (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Mar. 31, 2012	Dec. 31, 2011	Jun. 30, 2011	Mar. 31, 2011	Dec. 31, 2010
Financing Receivable, Allowance for Credit Losses [Line Items]
Financing Receivable, Allowance for Credit Losses, Individually Evaluated for Impairment	$ 544		$ 178
Financing Receivable Gross - individually evaluated for impairment	544		178
Financing Receivable, Individually Evaluated for Impairment	0		0
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment	115		106
Financing Receivable Gross - collectively evalauated for impairment	14,330		13,940
Financing Receivable, Collectively Evaluated for Impairment	14,215		13,834
Financing Receivable, Allowance for Credit Losses	659	257	284	353	380	411
Financing Receivable, Gross	14,874		14,118
Financing Receivable, Net	$ 14,215		$ 13,834

XML

Organization and Summary of Significant Accounting Policies Income tax disclosure (Details) (USD $)	6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Dec. 31, 2011
Income tax Fn 1 disclosures [Line Items]
effective tax rate before discrete items	40.90%	41.70%
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate	35.00%	35.00%
effective tax rate after discrete items	40.40%	41.00%
Unrecognized Tax Benefits	$ 7,200,000		$ 5,800,000
Unrecognized Tax Benefits, Period Increase (Decrease)	1,400,000
Unrecognized Tax Benefits that Would Impact Effective Tax Rate	6,000,000		4,600,000
MTS-Medication Technologies [Member]
Income tax Fn 1 disclosures [Line Items]
Unrecognized Tax Benefits, Increases Resulting from Acquisition	$ 1,000,000

XML

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Net income	$ 1,375	$ 2,587	$ 3,726	$ 3,257
Other comprehensive income, net of tax:
Unrealized holding losses arising during the period	(3)	0	(1)	0
Changes in fair value of foreign currency forward hedges	65	0	65	0
Foreign currency translation adjustment	(16)	0	(16)	0
Other comprehensive income	46	0	48	0
Comprehensive income	$ 1,421	$ 2,587	$ 3,774	$ 3,257

XML

Inventories

6 Months Ended

Jun. 30, 2012

Inventory Disclosure [Abstract]

Inventories

Inventories

Inventories consist of the following (in thousands):

	June 30, 2012		December 31, 2011
Raw materials	$	11,310	$	7,666
Work in process	585		14
Finished goods	13,275		10,427
Total	$	25,170	$	18,107

XML

Commitments (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012
Commitments [Abstract]
2012 (remaining six months)	$ 2,978
2013	5,154
2014	5,272
2015	5,183
2016	4,898
2017	4,206
Thereafter	20,430
Total	$ 48,121

XML

Stock Option Plans and Share-Based Compensation Stock expense by P&L caption (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Allocated Share-based Compensation Expense	$ 2,213	$ 2,451	$ 4,420	$ 4,843
Cost of Sales [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Allocated Share-based Compensation Expense	233	383	501	750
Research and Development Expense [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Allocated Share-based Compensation Expense	211	345	454	672
Selling, General and Administrative Expenses [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Allocated Share-based Compensation Expense	$ 1,769	$ 1,723	$ 3,465	$ 3,421

XML

Inventories (Tables)

6 Months Ended

Jun. 30, 2012

Inventory Disclosure [Abstract]

Schedule of Inventory, Current [Table Text Block]

Inventories consist of the following (in thousands):

	June 30, 2012		December 31, 2011
Raw materials	$	11,310	$	7,666
Work in process	585		14
Finished goods	13,275		10,427
Total	$	25,170	$	18,107

XML

Business Acquisition Bus Acq - tranasaction costs expense in period (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Jun. 30, 2012
Business Acquisition [Abstract]
Business Combination, Acquisition Related Costs	$ 3,157

XML

Organization and Summary of Significant Accounting Policies Risks - concentration Revenue and Acct Rec, trading and H-T-M amounts (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011	Dec. 31, 2011
Organization, Consolidation and Presentation of Financial Statements [Abstract]
customers with 10% revenue concentration	0	0	0	0
customers with 10% accounts receivable concentration	0		0		0
Trading Securities	$ 0		$ 0		$ 0
Held-to-maturity Securities, Fair Value	$ 0		$ 0		$ 0

XML

Business Acquisition

6 Months Ended

Jun. 30, 2012

Business Acquisition [Abstract]

Business Combination Disclosure [Text Block]

Business Acquisition

On May 21, 2012, Omnicell, completed its merger with MedPak Holdings, Inc. (“MedPak”) pursuant to an Agreement and Plan of Merger (the “Merger Agreement”) under which Mercury Acquisition Corp, a newly formed Omnicell subsidiary, was merged with and into MedPak, with MedPak surviving the merger as a wholly-owned subsidiary of Omnicell. MedPak is the parent company of MTS Medication Technologies, Inc.

Pursuant to the terms of the Merger Agreement, Omnicell paid approximately $158.3 million in cash after adjustments provided for in the Merger Agreement, of which approximately $13.5 million was placed in an escrow fund, which will ultimately be distributed to MedPak's stockholders (subject to claims that Omnicell may make against the escrow fund for indemnification and other claims following the closing). Omnicell has accrued a $1.8 million liability as of June 30, 2012, based on additional estimated working capital adjustments as provided under the Merger Agreement.

The MTS acquisition primarily was to align the Company with the long term trends of the healthcare market to manage the health of patients across the continuum of care. We can now better serve both the acute care and non-acute care markets. Omnicell and MTS bring capabilities to each other that strengthen the product lines and expand the medication management coverage of both companies.

Omnicell is accounting for the transaction under the acquisition method of accounting in accordance with the provisions of FASB ASC Topic 805, Business Combinations. Under the acquisition method, the estimated fair value of the consideration transferred to purchase the acquired company is allocated to the assets acquired and the liabilities assumed based on their fair values. Omnicell has made significant estimates and assumptions in determining the allocation of the acquisition consideration. The acquisition consideration of $160.1 million is comprised of $158.3 million in cash at closing plus an estimated $1.8 million net working capital adjustment recorded in accrued liabilities, subject to review by the seller and possible adjustment.

The total consideration, and the allocation of consideration to the individual net assets is considered preliminary, as there are remaining uncertainties to be resolved, including the settlement of the final net working capital adjustment and the completion of an analysis of potential contingent payroll tax withholding obligations.

The total acquisition price was approximately $160.1 million and the preliminary acquisition price allocation was comprised of the following (in thousands):

	Fair value acquired
Cash including restricted cash	$	2,000
Accounts receivable	7,403
Inventory	11,726
Deferred tax assets and other current assets	2,864
Total current assets	23,993
Property and equipment	11,088
Intangibles	83,500
Goodwill	84,491
Other non-current assets	244
Total assets	203,316
Current liabilities	(8,046		)
Non-current deferred tax liabilities	(33,898		)
Other non-current liabilities	(1,227		)
Net assets acquired	$	160,145
Cash consideration, fair value	$	160,145

Accounts receivable is presented at its fair value, comprised of total contractual obligations due of $7.6 million of which $0.2 million is not expected to be collected. Based on an acquisition date valuation, the estimated fair values of acquired inventory and property and equipment exceeded their historical carrying values.

Identifiable intangible assets. Acquired technology relates to MTS’ products across all of its product lines that have reached technological feasibility, primarily the OnDemand technology. Trade name is primarily related to the MTS and OnDemand brand names. Customer relationships represent existing contracted relationships with pharmacies, institutional care facilities and others. Acquired technology, customer relationships, and trade names will be amortized on a straight-line basis over their estimated useful lives, which range from 12 to 30 years.

The estimated fair values of the acquired technology, trade names and customer relationships were primarily determined using either the relief-from-royalty or excess earnings methods. The interest rates utilized to discount net cash flows to their present values were determined after consideration of the overall enterprise rate of return and the relative risk and importance of the assets to the generation of future cash flows.

For income tax purposes, the historical tax bases of the acquired assets and assumed liabilities, along with the tax attributes of the MTS companies, will carryover. Because the transaction was a cash for stock transaction, there is no tax basis in the newly acquired intangible assets. Accordingly, the acquisition accounting includes the establishment of net deferred tax liabilities of $33.9 million, resulting from book tax basis differences related to the intangible assets acquired, as well as to the step up in the value of fixed assets and inventory to their estimated fair values at the time of acquisition.

Goodwill. Approximately $84.5 million has been allocated to goodwill. Goodwill represents the excess of the fair value of the consideration transferred over the fair value of the underlying net tangible and identifiable intangible assets on the acquisition date. In accordance with ASC Topic 350, Intangibles - Goodwill and Other, goodwill will not be amortized, but instead will be tested for impairment at least annually or more frequently if certain indicators are present. In the event our management determines that the value of goodwill has become impaired, we will incur an accounting charge for the amount of impairment during the quarter in which the determination is made. We believe the MTS acquisition enhances Omnicell’s offerings and diversifies its revenue mix providing a more robust product and service solution to its current customers while expanding Omnicell’s international presence. Omnicell considers these factors as supporting the amount of goodwill recorded.

Details of acquired intangibles are as follows (in thousands, except for years):

	Fair value acquired		Useful Life (years)	First year amortization expense
Trade name	$	6,800	12	$	567
Customer relationships	50,100		28 to 30	1,693
Acquired technology	26,600		20	1,330
Intangibles acquired	$	83,500		$	3,590
Weighted avg. life of intangibles			25.11

For the three months ended June 30, 2012, Omnicell incurred approximately $3.2 million in acquisition related costs related to the MTS acquisition. These costs are included in selling, general and administrative expenses on Omnicell’s Condensed Consolidated Statement of Operations.

During the three months ended June 30, 2012, the acquired MTS operations (consolidated since the May 21, 2012 acquisition date) generated approximately $8.9 million of revenue and a net loss of $1.5 million.    

The following represents unaudited pro forma revenue and net income as if MTS had been included in our consolidated results from January 1, 2011 (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2012		2011		2012		2011
Revenues	$	85,204	$	80,798	$	168,270	$	157,247
Net income	$	4,110	$	3,874	$	6,595	$	6,056

The pro forma unaudited condensed consolidated operating results presented above were calculated after applying the Company's accounting policies and by adding together the historical operating statements of MTS and Omnicell, with certain adjustments, assuming an acquisition date of January 1, 2011. The adjustments include replacement of MTS historical depreciation and amortization expense with acquisition-accounting depreciation and amortization expense, based on the estimated fair values and useful lives determined from the allocation of total MTS acquisition consideration. Also reflected is the interest expense elimination effect of MTS on its debt (since it would have been paid off at acquisition) and the elimination of certain management fees to an affiliated party, offset in part by interest income foregone by Omnicell, by no longer having the acquisition consideration available as interest-bearing cash, cash equivalents and short-term investments.

The pro forma operating results do not include actual acquisition-related expenses by MTS and Omnicell as such amounts are considered nonrecurring. The total of all adjustments were tax effected using an estimated federal and state effective income tax rate.

The pro forma operating results do not include any assumption of operating synergies for the combined companies. These pro forma results are provided as required disclosures and should not be considered as a forecast for any future period, nor as representing what the actual operating results would have been if the acquisition, in fact, had occurred on January 1, 2011.