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Fair Value Measurements | 6 Months Ended
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Mar. 30, 2013
Fair Value Disclosures [Abstract] |
Fair Value Measurements | (2) Fair Value Measurements Assets/Liabilities Measured and Recorded at Fair Value on a Recurring Basis As of March 30, 2013 and September 29, 2012, the Company’s financial assets that are re-measured at fair value on a recurring basis included $0.3 million in money market mutual funds in both periods that are classified as cash and cash equivalents in the Consolidated Balance Sheets. Money market funds are classified within Level 1 of the fair value hierarchy and are valued using quoted market prices for identical assets. As a result of its acquisition of Gen-Probe Incorporated (“Gen-Probe”), the Company has an equity investment in a publicly-traded company and mutual funds, both of which are valued using quoted market prices, representing Level 1 assets. The Company has a payment obligation to the participants under its Nonqualified Deferred Compensation Plan (“DCP”) and the deferred compensation plan assumed in the Gen-Probe acquisition. This aggregate liability is recorded at fair value based on the underlying value of certain hypothetical investments under the DCP and actual investments under the plan assumed from Gen-Probe as designated by each participant for their benefit. Since the value of the deferred compensation plan obligations are based on market prices, the liability is classified within Level 1. In addition, the Company has contingent consideration liabilities related to its acquisitions that are recorded at fair value. The fair values of these liabilities are based on Level 3 inputs and are discussed in Note 6(a). Assets and liabilities measured and recorded at fair value on a recurring basis consisted of the following at March 30, 2013:
|  |  |  |  | Fair Value at Reporting Date Using |
|  | Balance as of March 30, 2013 |  |  | Quoted Prices in Active Market for Identical Assets (Level 1) |  |  | Significant Other Observable Inputs (Level 2) |  |  | Significant Unobservable Inputs (Level 3) |
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Money market funds |  | $ | 315 |  |  | $ | 315 |  |  | $ | — |  |  | $ | — |
Marketable securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Equity securities |  |  | 8,159 |  |  |  | 8,159 |  |  |  | — |  |  |  | — |
Mutual funds |  |  | 7,002 |  |  |  | 7,002 |  |  |  | — |  |  |  | — |
Total |  | $ | 15,476 |  |  | $ | 15,476 |  |  | $ | — |  |  | $ | — |
Liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Deferred compensation liabilities |  | $ | 37,011 |  |  | $ | 37,011 |  |  | $ | — |  |  | $ | — |
Contingent consideration |  |  | 3,627 |  |  |  | — |  |  |  | — |  |  |  | 3,627 |
Total |  | $ | 40,638 |  |  | $ | 37,011 |  |  | $ | — |  |  | $ | 3,627 |
Changes in the fair value of recurring fair value measurements using significant unobservable inputs (Level 3), which solely consisted of contingent consideration liabilities, were as follows:
|  | Three Months Ended |  |  | Six Months Ended |
|  | March 30, 2013 |  |  | March 24, 2012 |  |  | March 30, 2013 |  |  | March 24, 2012 |
Balance at beginning of period |  | $ | 93,000 |  |  | $ | 104,807 |  |  | $ | 86,368 |  |  | $ | 103,790 |
Fair value adjustments |  |  | 799 |  |  |  | 43,188 |  |  |  | 10,839 |  |  |  | 48,310 |
Payments made |  |  | (90,172 | ) |  |  | (51,783 | ) |  |  | (93,580 | ) |  |  | (55,888 | )
Balance at end of period |  | $ | 3,627 |  |  | $ | 96,212 |  |  | $ | 3,627 |  |  | $ | 96,212 |
The remaining contingent consideration liability represents amounts withheld from payments made to the former shareholders of Interlace Medical, Inc. for legal indemnification provisions. Assets Measured and Recorded at Fair Value on a Nonrecurring Basis The Company remeasures the fair value of certain assets and liabilities upon the occurrence of certain events. Such assets are comprised of cost-method equity investments and long-lived assets, including property, plant and equipment, intangible assets and goodwill. The Company holds certain cost-method equity investments in non-publicly traded securities aggregating $17.8 million and $16.0 million at March 30, 2013 and September 29, 2012, respectively, which are included in other long-term assets on the Company’s Consolidated Balance Sheets. These investments are generally carried at cost. As the inputs utilized for the Company’s periodic impairment assessment are not based on observable market data, these cost method investments are classified within Level 3 of the fair value hierarchy. To determine the fair value of these investments, the Company uses all available financial information related to the entities, including information based on recent or pending third-party equity investments in these entities. In certain instances, a cost method investment’s fair value is not estimated as there are no identified events or changes in circumstances that may have a significant adverse effect on the fair value of the investment and to do so would be impractical. In the second quarter of fiscal 2013, the Company recorded an other-than-temporary impairment charge of $1.7 million related to one of these investments. Refer to Note 4 for disclosure of the nonrecurring fair value measurement related to the impairment charge for manufacturing equipment and equipment located at customer sites recorded in the second quarter of fiscal 2012. Refer to Note 5 for disclosure of the nonrecurring fair value measurement related to the debt extinguishment losses recorded in the second quarter of fiscal 2013 and 2012. Disclosure of Fair Value of Financial Instruments The Company’s financial instruments mainly consist of cash and cash equivalents, accounts receivable, marketable securities, cost-method equity investments, insurance contracts, deferred compensation plan liabilities, accounts payable and debt obligations. The carrying amounts of the Company’s cash equivalents, accounts receivable and accounts payable approximate their fair value due to the short-term nature of these instruments. The carrying amount of the insurance contracts are recorded at the cash surrender value, as required by U.S. generally accepted accounting principles, which approximates fair value, and the related DCP liability is recorded at fair value. The Company believes the carrying amounts of its cost-method investments approximate fair value. The $2.47 billion in aggregate principal outstanding under the Company’s Credit Agreement is subject to variable rates of interest based on current market rates, and as such, the Company believes the carrying amount of these obligations approximates fair value. The Company’s Senior Notes were registered with the Securities and Exchange Commission in the second quarter of fiscal 2013, and had a fair value of $1.06 billion as of March 30, 2013 based on their trading price, representing a Level 1 measurement. The fair value of the Company’s Convertible Notes is based on the trading prices of the respective notes at the dates noted and represents a Level 1 measurement. The Company had $1.56 billion of Convertible Notes recorded (see Note 5 for further discussion) as of March 30, 2013 and September 29, 2012. The aggregate principal amount of the Convertible Notes at both periods was $1.725 billion. As of March 30, 2013, the Company has four issues of Convertible Notes outstanding: the 2007 Notes (principal of $405.0 million), the 2010 Notes (principal of $450.0 million), the 2012 Notes (principal of $500.0 million) and the 2013 Notes (principal of $370.0 million). The estimated fair values of the Company’s Convertible Notes were as follows:
|  | March 30, 2013 |  |  | September 29, 2012 |
2007 Notes |  | $ | 407,100 |  |  | $ | 771,600 |
2010 Notes |  |  | 541,100 |  |  |  | 505,600 |
2012 Notes |  |  | 524,100 |  |  |  | 490,700 |
2013 Notes |  |  | 387,600 |  |  |  | — |
|  | $ | 1,859,900 |  |  | $ | 1,767,900 |

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- Definition The entire disclosure of the fair value measurement of assets and liabilities, which includes financial instruments measured at fair value that are classified in shareholders' equity, which may be measured on a recurring or nonrecurring basis. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=7578670&loc=d3e19279-110258 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=7578670&loc=d3e19190-110258 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 157 -Paragraph 33 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=7578670&loc=d3e19207-110258 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 157 -Paragraph 32 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 107 -Paragraph 10 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 157 -Paragraph 6 -Footnote 4 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. + Details
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