8-K

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C.  20549

___________

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported) August 24, 2010

VARIAN MEDICAL SYSTEMS, INC.

(Exact Name of Registrant as Specified in its Charter)

Delaware	1-7598	94-2359345
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer  Identification No.)

3100 Hansen Way, Palo Alto, CA	94304-1030
(Address of Principal Executive Offices)	(Zip Code)

Registrant's telephone number, including area code (650) 493-4000

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01. Entry into a Material Definitive Agreement

After market close on August 24, 2010, Varian Medical Systems, Inc. (the “Company”) entered into an agreement with Bank of America, N.A. (“BofA”) to repurchase $225 million of the Company’s common stock under an accelerated share repurchase program (the “Repurchase Agreement”).  The shares of common stock will be acquired under both the remainder of the five million share repurchase authorization approved by the company’s Board of Directors on November 13, 2009 (which expires December 31, 2010), and the eight million share repurchase authorization approved by the company’s Board of Directors on August 6, 2010 (which expires September 30, 2011).  The repurchase of stock will be funded through a combination of available cash on hand and borrowings under the Company’s revolving credit facility with BofA.  Shares purchased under the Repurchase Agreement will be retired.

Under the terms of the Repurchase Agreement, on August 25, 2010, the Company will pay to BofA $225 million and receive from BofA approximately 3.8 million shares, or 90% of the shares to be repurchased based on the closing price of the Company’s common stock on August 24, 2010.  The specific number of shares that the Company ultimately will repurchase under the Repurchase Agreement will be based generally on the volume weighted average share price of the Company’s common stock during the repurchase period, subject to other adjustments pursuant to the terms and conditions of the Repurchase Agreement.  The Repurchase Agreement contemplates that the repurchase period will be between four and six months.  At the completion of the Repurchase Agreement, the Company may be entitled to receive additional shares of its common stock from BofA or, under certain circumstances specified in the Repurchase Agreement, the Company may be required deliver shares or make a cash payment (at its option) to BofA.

The Repurchase Agreement contains the principal terms and provisions governing the accelerated share repurchase, including the mechanism used to determine the number of shares that will be delivered, the required timing of delivery of the shares, the permitted methods and required timing of settlement, the circumstances under which BofA is permitted to make adjustments to valuation periods and calculations, the circumstances under which the Repurchase Agreement may be terminated early, definitions of terms used throughout the Repurchase Agreement, and various acknowledgements, representations and warranties made by the Company and BofA to one another.

BofA and certain of its affiliates have engaged, and may in the future engage, in financial advisory, investment banking and other services for the Company and its affiliates, including entering into share repurchase programs and acting as a lender under the Company’s revolving credit facility.

Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant

On August 24, 2010, the Company entered into an amendment to its Amended and Restated Credit Agreement dated as of November 10, 2008, as amended, with BofA to increase its borrowing capacity thereunder from $150 million to $225 million (as amended, the “BofA Credit Facility”).  On August 24, 2010, the Company borrowed $145 million under the BofA Credit Facility to finance a portion of its obligations under the Repurchase Agreement.  The material terms and conditions of the BofA Credit Facility have been previously reported in the Company’s periodic filings with the Securities and Exchange Commission, most recently in the Company’s Quarterly Report on Form 10-Q for the quarter ended July 2, 2010.

Item 9.01.  Financial Statements and Exhibits.

(c) Exhibits.

99.1 Press Release dated August 24, 2010 entitled “Varian Medical Systems Announces $225 Million Accelerated Stock Repurchase; Increases its Revolving Credit Facility.”

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 hereunto duly authorized.

Varian Medical Systems, Inc.
By:	/s/ John W. Kuo
Name:	John W. Kuo
Title:	Corporate Vice President, General Counsel and Secretary

Dated:  August 24, 2010

EXHIBIT INDEX

Number	Exhibit
99.1	Press Release dated August 24, 2010 entitled “Varian Medical Systems Announces $225 Million Accelerated Stock Repurchase; Increases its Revolving Credit Facility.”

EX-99.1

Exhibit 99.1

FOR INFORMATION CONTACT:

Spencer Sias   (650) 424-5782

Spencer.sias@varian.com

For Immediate Release

Varian Medical Systems Announces $225 Million Accelerated Stock Repurchase; Increases its Revolving Credit Facility

PALO ALTO, Calif., August 24, 2010 – Varian Medical Systems, Inc. (NYSE:VAR) today announced that it has entered into an agreement with Bank of America N.A. to repurchase $225 million of its common stock under an accelerated share repurchase program.  Concurrently, the company amended its revolving credit facility with Bank of America N.A. to increase its borrowing capacity from $150 million to $225 million.

Under the accelerated repurchase agreement, Varian will pay $225 million to Bank of America N.A. and receive approximately 3.8 million shares, or 90% of the shares to be repurchased based on the closing share price of the company’s common stock on August 24, 2010.  The total number of shares ultimately repurchased under the agreement will be determined upon final settlement.  Varian will either receive additional shares of common stock or under certain circumstances be required to remit a settlement amount payable at Varian’s option in cash or common stock, based generally on the volume weighted average share price of Varian’s common stock during the next four to six months.

“Given the strength of Varian’s balance sheet and the low interest rate environment, we have an opportunity to return shareholder value through this program,” said Tim Guertin, president and CEO of Varian Medical Systems.  “This program will be accretive to earnings going forward, but will have a minimal impact on fiscal year 2010.”

These shares will be acquired under both the remainder of the 5 million share repurchase authorization approved by the company’s Board of Directors on November 13, 2009, and the more recent 8 million share repurchase authorization approved by the company’s Board of Directors on August 6, 2010.  At the conclusion of the accelerated share repurchase program, the company expects that approximately 5 million shares willremain under the August 2010 authorization, depending on the company’s stock price during the accelerated repurchase program.  Shares purchased under the accelerated share repurchase program will be retired.

The repurchase will be financed partially from cash on hand and partially with borrowings from the company’s amended revolving credit facility.

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Varian Medical Systems Announces $225 Million Accelerated Stock Repurchase Page  2

As of the end of the third quarter of its fiscal year 2010, the company had 124.5 million fully diluted shares outstanding.  Since initiating share repurchases at the end of fiscal year 2001, the company has spent $1.8 billion to repurchase 43 million shares of common stock at an average price of $41.41 per share.

Varian Medical Systems, Inc., of Palo Alto, California, is the world's leading manufacturer of medical devices and software for treating cancer and other medical conditions with radiotherapy, radiosurgery, proton therapy, and brachytherapy. The company supplies informatics software for managing comprehensive cancer clinics, radiotherapy centers and medical oncology practices. Varian is a premier supplier of tubes and digital detectors for X-ray imaging in medical, scientific, and industrial applications and also supplies X-ray imaging products for cargo screening and industrial inspection. Varian Medical Systems employs approximately 5,200 people who are located at manufacturing sites in North America, Europe, and China and approximately 70 sales and support offices around the world. For more information, visit http://www.varian.com.

Forward-Looking Statements

Except for historical information, this news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Statements concerning future financial results and any statements using the terms “expect,” “will,” “believe,” “estimate,” or similar statements, are forward-looking statements that involve risks and uncertainties that could cause the company’s actual results to differ materially from those anticipated. Such risks and uncertainties include the volume-weighted average share price through expected completion of the repurchase agreement, the actual completion date of the repurchase agreement, the final number of shares repurchased, the aggregate cost to the company, whether the company elects to satisfy any settlement payment in cash or in stock, and the company’s ability to generate cash flow, and the other risks listed from time to time in the company’s filings with the Securities and Exchange Commission, which by this reference are incorporated herein. The company assumes no obligation to update or revise the forward-looking statements in this release because of new information, future events, or otherwise.