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EMPLOYEE STOCK PLANS | 3 Months Ended
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Jan. 03, 2025
Share-Based Payment Arrangement [Abstract] |
EMPLOYEE STOCK PLANS | EMPLOYEE STOCK PLANS Share-Based Compensation Expense Share-based compensation expense recognized in the Condensed Consolidated Statements of Operations is based on awards ultimately expected to vest. Share-based compensation expense includes expenses related to the Company’s direct employees. The table below summarizes the effect of recording share-based compensation expense and the option value of the employee stock purchase plan shares:
| Three Months Ended |  |
(In millions) | January 3, 2025 |  | December 29, 2023 |  |  |  |
Cost of revenues | $ | 0.5 |  |  | $ | 0.5 |  |  |  |  |
Research and development | 0.9 |  |  | 0.9 |  |  |  |  |
Selling, general, and administrative | 2.7 |  |  | 2.3 |  |  |  |  |
Total share-based compensation expense | $ | 4.1 |  |  | $ | 3.7 |  |  |  |  |
Stock Option Activity The following table summarizes stock option activity under Varex’s employee incentive plans for the Company's employees:
(In thousands, except per share amounts and the remaining term) | Options |  | Price Range |  | Weighted Average Exercise Price |  | Weighted Average Remaining Term (in years) |  | Aggregate Intrinsic Value(1)
Outstanding at September 27, 2024 | 2,097 |  |  | $13.61 - $37.60 |  | $ | 26.79 |  |  | 5.5 |  | $ | — |
Canceled, expired, or forfeited | (9) |  |  | $37.60 - $37.60 |  | 37.60 |  |  |  |  |
Outstanding at January 3, 2025 | 2,088 |  |  | $13.61 - $37.10 |  | $ | 26.74 |  |  | 5.2 |  | $ | 116.5 |
Exercisable at January 3, 2025 | 1,779 |  |  | $13.61 - $37.10 |  | $ | 27.21 |  |  | 4.8 |  | $ | 109.3 |
(1) The aggregate intrinsic value represents the total pre-tax intrinsic value, which is computed based on the difference between the exercise price and the closing price of Varex common stock of $14.26 as of January 3, 2025, the last trading date of the Company's first quarter, and which represents the amount that would have been received by the option holders had all option holders exercised their in-the-money options and sold the shares received upon exercise as of that date. Restricted Stock Units, Performance Stock Units, and Deferred Stock Units The Company issues performance stock units ("PSUs") to certain officers and key employees in connection with our long-term incentive program. Each PSU represents the right to receive one share of our common stock, provided that the applicable performance and vesting conditions are satisfied. The fair value of certain PSUs are linked to the achievement of performance goals based on Adjusted EBITDA margin. The fair value of certain other PSUs are linked to a market condition based on our relative total shareholder return over the performance period compared to a predetermined peer group. The following table summarizes the activity for restricted stock units, performance stock units, and deferred stock units under the 2020 Omnibus Stock Plan:
(In thousands, except per share amounts) | Number of Shares |  | Weighted Average Grant-Date Fair Value
Outstanding at September 27, 2024 | 1,670 |  |  | $ | 20.74 |
Granted | 632 |  |  | 15.83 |
Vested | (224) |  |  | 19.93 |
Canceled or expired | (28) |  |  | 20.54 |
Outstanding at January 3, 2025 | 2,050 |  |  | $ | 19.36 |

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