UNITED STATES
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)
July 25, 2006
QUALITY SYSTEMS, INC.
(Exact name of registrant as specified in its charter)
CALIFORNIA 0-13801 95-2888568
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification Number)
18191 Von Karman, Suite 450
Irvine, California 92612
(Address of Principal Executive Offices)
(949) 255-2600
(Registrant's Telephone Number, Including Area Code)
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.
On July 25, 2006, the Board of Directors of Quality Systems, Inc.(referred
herein to as the "Company," "Registrant" or "QSI"), approved revisions to the
Company's compensation program for its four Named Executive Officers. The
compensation levels for the Named Executive Officers are as follows:
1. Base salaries, and their respective effective dates are as
follows: Louis Silverman (President and Chief Executive Officer) $400,000;
Patrick Cline (President, NextGen Healthcare Information Systems
Division), $450,000, effective November 1, 2006; Gregory Flynn (Executive
Vice President, General Manager of QSI Division) $230,000, effective
November 1, 2006; Paul Holt (Chief Financial Officer and Secretary),
$230,000, effective July 23, 2006.
2. Bonus criteria for the Named Executive Officers are as follows:
(i) for the Company's President and Chief Executive Officer, a bonus of
up to $450,000 may be earned based on meeting certain target
increases in EPS performance and revenue growth during the fiscal
year as well as meeting certain operational requirements established
by the Board of Directors;
(ii) for the President of the Company's NextGen Healthcare Information
Systems Division, a bonus of up to $500,000 may be earned based on
meeting certain target increases in EPS performance and revenue
growth during the fiscal year as well as meeting certain operational
requirements established by the Board of Directors;
(iii) for the Executive Vice President/General Manager of the Company's
QSI Division, a bonus of up to $70,000 may be earned based upon the
achievement of certain qualitative and quantitative goals related to
both QSI division performance and other corporate objectives as
approved by the Compensation Committee of the Board of Directors and
the Board of Directors; and
(iv) for the Company's Chief Financial Officer and Secretary, a bonus of
up to $70,000 may be earned based upon the achievement of certain
qualitative goals as approved by the Compensation Committee and the
Board of Directors.
3. For the fiscal year ending March 31, 2007, the Named Executive
Officers are eligible to receive an aggregate of up to 70,000 options to
purchase the Company's common stock based on meeting certain target
increases in EPS performance and revenue growth during the fiscal year as
follows: Louis Silverman (Chief Executive Officer): 20,000 options;
Patrick Cline (President, NextGen Healthcare Information Systems
Division), 40,000 options; Gregory Flynn (Executive Vice President,
General Manager of QSI Division) 5,000 options; Paul Holt (Chief Financial
Officer and Secretary), 5,000 options. The options shall be issued
pursuant to one of the Company's shareholder approved option plans, have
an exercise price equal to the closing price of
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the Company's shares on the Nasdaq Global Select Market (or such other
market upon which such shares then trade) as of the date of grant, a term
of five years, vest in four equal, annual installments commencing one year
following the date of grant and be granted pursuant to the Company's
standard stock option agreement.
4. A special one-time cash bonus payment to Paul Holt, Chief
Financial Officer, in the amount of $15,000 was approved based on
extraordinary service in connection with his duties during the fiscal year
ended March 31, 2006.
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.
Date: July 31, 2006
QUALITY SYSTEMS, INC.
By: /s/ Paul Holt
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Paul Holt
Chief Financial Officer
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