SEC Form 4

FORM 4

[ ] Check this box if no longer
subject to Section 16. Form 4 or Form
5 obligations may continue.
See Instruction 1(b).

UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP

Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934, Section 17(a) of the Public Utility
Holding Company Act of 1935 or Section 30(h) of the Investment Company Act of 1940

OMB APPROVAL

OMB Number: 3235-0287

Expires: January 31, 2005
Estimated average burden
hours per response. . . . . 0.5

1. Name and Address of Reporting Person^*

Doyle, David M.

(Last) (First) (Middle)

c/o Quest Software, Inc.

8001 Irvine Center Drive

(Street)

Irvine, CA 92618

(City) (State) (Zip)

2. Issuer Name
and Ticker or Trading Symbol

Quest Software, Inc.
QSFT

3. I.R.S. Identification
    Number of Reporting
    Person, if an entity
    (voluntary)

4. Statement for
Month/Day/Year

01/03/03

5. If Amendment,
Date of Original
(Month/Day/Year)

6. Relationship of Reporting Person(s) to Issuer

(Check all applicable)

X Director X 10% Owner

X Officer (give title below) Other (specify below)

Description President

7. Individual or Joint/Group
Filing (Check Applicable Line)

X Form filed by One Reporting Person

Form filed by More than One Reporting Person

Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned

1. Title of Security
(Instr. 3)

2.Transaction
Date
(Month/Day/Year)

2A. Deemed Execution Date, if any
(Month/Day/Year)

3. Transaction
Code
(Instr. 8)

4. Securities Acquired (A) or Disposed Of (D)
(Instr. 3, 4, and 5)

5. Amount of
    Securities
    Beneficially
    Owned Following
    Reported Transaction(s)

    (Instr. 3 and 4)

6. Owner-
    ship
    Form:
    Direct (D)
    or
    Indirect (I)

    (Instr. 4)

7. Nature of
     Indirect
     Beneficial
     Ownership

    (Instr. 4)

Code

Amount

A/D

Price

Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned

(e.g., puts, calls, warrants, options, convertible securities)

1. Title of Derivative Security
(Instr. 3)

2. Conver-
    sion or
    Exercise
    Price of
    Deri-
    vative
    Security

3. Transaction Date

(Month/
Day/
Year)

3A. Deemed Execution Date, if any

(Month/
Day/
Year)

4. Transaction Code
(Instr.8)

5. Number of Derivative
    Securities Acquired (A)
    or Disposed Of (D)

    (Instr. 3, 4 and 5)

6. Date Exercisable(DE) and
Expiration Date(ED)
(Month/Day/Year)

7. Title and Amount of
Underlying Securities
(Instr. 3 and 4)

8. Price
    of
    Derivative
    Security
    (Instr.5)

9. Number of
    Derivative
    Securities
    Beneficially
    Owned
    Following
    Reported
    Transaction(s)
    (Instr.4)

10. Owner-
ship
Form of
Deriv-
ative
Securities:
Direct (D)
or
Indirect (I)

(Instr.4)

11. Nature of
      Indirect
      Beneficial
      Ownership
      (Instr.4)

Code

Title

Amount or Number of Shares

Futures Contract (Obligation to Sell)

(1)

01/03/03

250,000

(1)

01/03/05

Common Stock

250,000

(1)

250,000

Explanation of Responses:

(1) Mr. Doyle entered into a pre-paid variable delivery forward contract on January 3, 2003 relating to 250,000 shares (the "Number of Shares") of Quest Software, Inc. common stock ("Common Stock"). Under the contract, in exchange for a cash payment of $2,296,552.50, Mr. Doyle agreed to deliver a number of shares of Common Stock in January 2005 (or on an earlier date if the contract is terminated early) pursuant to the following formula: (i) if the price of Common Stock in January 2005 (the "Settlement Value") is less than or equal to $10.31 (the "Floor Price"), the Number of Shares; (ii) if the Settlement Value is less or equal to $12.3720 (the "Threshold Price"), but greater than the Floor Price, then a number of shares equal to the Number of Shares times the Floor Price divided by the Settlement Value; (iii) if the Settlement Value is greater than the Threshold Price, then a number of shares to be determined by reference to a formula set forth in the contract. Al ternatively, Mr. Doyle has the option to cash settle the contract, with the cash settlement amount being equal to the number of shares to be delivered times the Settlement Value.

By:
/s/ J. Michael Vaughn, Attorney-in-Fact for David M. Doyle January 3, 2003
** Signature of Reporting Person Date

SEC 1474 (9-02)

Reminder: Report on a separate line for each class of securities beneficially owned directly or indirectly.

* If the form is filed by more than one reporting person, see Instruction 4(b)(v).
** Intentional misstatements or omissions of facts constitute Federal Criminal Violations See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
Note: File three copies of this Form, one of which must be manually signed. If space is insufficient, see Instruction 6 for procedure.
Potential persons who are to respond to the collection of information contained in this form are not
required to respond unless the form displays a currently valid OMB Number.