8-K

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)

August 11, 2008

QUALITY SYSTEMS, INC.

(Exact name of registrant as specified in its charter)

CALIFORNIA	0-13801	95-2888568
(State or other jurisdiction	(Commission File Number)	(IRS Employer
of incorporation)		Identification Number)

18111 Von Karman, Suite 600

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):

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

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

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

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

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.  

Appointment of New President and Chief Executive Officer.

On August 11, 2008, the Board of Directors of Quality Systems, Inc. (the “Company”), upon recommendation of the Company’s Independent Directors Compensation Committee, appointed Steven T. Plochocki as the President and Chief Executive Officer of the Company, effective August 16, 2008.

Mr. Plochocki, age 56, is a director of the Company and is presently a private healthcare investor.  Prior to his appointment as the President and Chief Executive Officer of the Company, he served on the Company’s Audit Committee and was the Chairman of its Compensation Committee and Independent Directors Compensation Committee.  From February 2007 to May 2008, he served as Chairman and Chief Executive Officer of Omniflight Helicopter, Inc., a Dallas-based air medical services company.   From October 2006 through February 2007 Mr. Plochocki was a private investor in the healthcare sector.  He previously served as Chief Executive Officer and Director of Trinity Hospice, a national hospice provider from October 2004 through October 2006.  Prior to joining Trinity Hospice, he was Chief Executive Officer of InSight, a national provider of diagnostic imaging services from November 1999 to August 2004.  Prior to that, he was Chief Executive Officer of Centratex Support Services, Inc., a support services company for the healthcare industry and had previously held other senior level positions with healthcare industry firms.  He holds B.A. in Journalism and Public Relations from Wayne State University and a Master’s degree in Business Management from Central Michigan University.   Mr. Plochocki has been a director of the Company since 2004.

Mr. Plochocki will remain a director of the Company but is no longer deemed an “independent” director under the Company’s Bylaws and applicable marketplace regulations.  Accordingly, he has resigned from his positions on the Company’s Audit Committee, Compensation Committee and Independent Directors Compensation Committee.

A copy of the news release announcing the appointment of Mr. Plochocki is attached to this Form 8-K as Exhibit 99.1, which is incorporated herein by this reference.

Employment Agreement

Mr. Plochocki and the Company have entered in to an Employment Agreement, a copy of which is attached to this report as Exhibit 10.1.  Under the terms of the Employment Agreement:

· Mr. Plochocki shall receive a base salary of $475,000 per fiscal year, prorated for fiscal year 2009 ($296,875 for remainder of fiscal year 2009 from the date of the Employment Agreement) and paid monthly in accordance with the Company’s standard payroll practices.

· Mr. Plochocki shall receive a signing equity payment of 50,000 nonqualified options to be granted on his first business day in office, Monday, August 18, 2008, with an exercise price equal to the fair market value of the Company’s common stock at the close of trading on such date.  The nonqualified options shall be issued from one of the Company’s existing shareholder approved option plans, have a term of 5 years and vest in 4 equal annual installments commencing one year from the date of grant and have such other terms and conditions as those contained in the Company’s standard stock option

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grant agreements for Company employees as filed with the Securities and Exchange Commission.

· Mr. Plochocki shall be eligible for cash bonus and equity bonus awards in accordance with the principles, terms and conditions of the Company’s existing 2009 Bonus Compensation Plan as filed with the Securities and Exchange Commission, provided, however, (i) the maximum cash bonus amount shall be $475,000 prorated for fiscal year 2009 ($296,875 for remainder of fiscal year 2009 from the date of the Employment Agreement); (ii) the maximum number of options which may be earned is 50,000, prorated for fiscal year 2009 (31,250 options for remainder of fiscal year 2009 from the date of the Employment Agreement); and (iii) the required number of acquisitions shall be prorated.

· Mr. Plochocki shall receive 3 weeks of vacation per year, prorated for fiscal year 2009 (9 business days for remainder of fiscal year 2009 from the date of the Employment Agreement).

· The 50,000 options granted to Mr. Plochocki as part of the signing equity payment shall immediately vest upon (i) a sale of substantially all of the equity or assets of the Company or a merger where the beneficial owners of the Company’s equity securities immediately prior to such merger no longer constitute a majority of the beneficial ownership immediately thereafter (a “Sale Transaction”); and (ii) Mr. Plochocki agrees to be employed by the buyer in such Sale Transaction for a period of no less than one year after the closing thereof.  If upon a Sales Transaction, Mr. Plochocki is not offered a position with the buyer in such Sales Transaction, he shall be paid a lump sum equal to one year’s base salary as then in effect.

· The employment agreement shall renew annually unless (i) either party shall provide no less than 30 days advance written notice to the other of its intent not to renew, or (ii) it is earlier terminated by election of either of the parties.  Either party may elect to terminate the employment agreement upon 30 days advance written notice.

· If the Company should terminate Mr. Plochocki’s employment without “cause” as may be determined by the Board of Directors, then he shall be entitled to receive from the Company upon the date of such termination a lump sum payment equal to (i) one year’s base salary as then in effect, and (ii) a pro-rated cash bonus equal to that percentage of the fiscal year completed at the date of his termination multiplied by the cash bonus actually earned under the Company’s fiscal year compensation plan (as filed with the Securities and Exchange Commission) payable to the CEO of the Company at the end of such fiscal year.  As used herein, the term “cause” shall mean (i) Mr. Plochocki’s willful breach or neglect of the duties and obligations required of him either expressly or impliedly by the terms of the Employment Agreement (including, but not limited to refusal to execute the Company’s standard confidential information agreement); or (ii) his commission of fraud, embezzlement or misappropriation, involving the Company whether or not a criminal or civil charge is filed in connection therewith.

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Amendments to 2009 Executive Compensation Plan.

On August 11, 2008, in connection with, and as a result of, the appointment of Steven T. Plochocki as President and Chief Executive Officer and following approval and recommendation by its Independent DirectorsCompensation Committee, the Company’s Board of Directors approved the following changes to the compensation program for the Company’s named executive officers for the fiscal year ending March 31, 2009 and previously reported on Form 8-K filed with the Securities and Exchange Commission on June 24, 2008:

· Non-Equity Cash Compensation

The changes to the Company’s non-equity cash incentive compensation component of the fiscal year 2009 compensation program resulting from the appointment of Mr. Plochocki as President and Chief Executive Officer are as follows:   Cash compensation of up to $475,000 (prorated for fiscal year 2009, resulting in $296,875 for remainder of fiscal year 2009 from the date of the Employment Agreement) 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 Company’s Board of Directors.   Of the total $475,000 potential cash compensation (prorated for fiscal year 2009, resulting in $296,875 for remainder of fiscal year 2009), 40% is allocated to the EPS performance criteria, 40% is allocated to revenue growth criteria and the remaining 20% is discretionary and is subject to meeting the acquisition objectives established by the Board of Directors

· Equity Compensation

The changes to the equity incentive compensation component of the Company’s fiscal year 2009 compensation program resulting from the appointment of Mr. Plochocki as President and Chief Executive Officer are as follows:  Mr. Plochocki is eligible to receive up to 50,000 options to purchase common stock prorated for fiscal year 2009 (31,250 options for remainder of fiscal year 2009)based on meeting certain target increases in EPS performance and revenue growth during the 2009 fiscal year with 50% of such amount allocated to the EPS performance criteria and 50% allocated to the revenue growth criteria.

Item 9.01 Financial Statements and Exhibits.

(d)   Exhibits.

Exhibit No.	Description
10.1	Employment Agreement dated August 11, 2008 between Quality Systems, Inc. and Steven Plochocki.
99.1	Press Release dated August 12, 2008

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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: August 12, 2008

QUALITY SYSTEMS, INC.
By:	/s/ Paul Holt
	Paul Holt
	Chief Financial Officer

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EXHIBITS ATTACHED TO THIS REPORT ON FORM 8-K

Exhibit No.	Description
10.1	Employment Agreement dated August 11, 2008 between Quality Systems, Inc. and Steven Plochocki.
99.1	Press Release dated August 12, 2008

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EX-10.1

Exhibit 10.1

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (“Agreement”), dated this August 11,  2008, has been made and entered into by and between Quality Systems, Inc., a California corporation (“Employer”) and Steven Plochocki, an individual (“Employee”).

R E C I T A L S

The Employer desires to employ Employee and Employee desires to perform the duties and obligations hereinafter described for the Employer upon the terms and conditions hereinafter set forth.

NOW, THEREFORE, in consideration of the mutual covenants and conditions herein contained and their performance, Employer and Employee agree as follows:

AGREEMENT

1. Duties.  For the employment term, as set forth in Section 2, Employer hereby agrees to employ Employee and Employee agrees to serve Employer in the capacity of President and Chief Executive Officer.

2.  Effective Date; Term.  The effective date of this Agreement shall be August 16, 2008, immediately upon resignation of existing CEO.  This term of this Agreement shall renew annually unless (i) either party hereto shall provide no less than 30 days advance written notice to the other of its intent not to renew, or (ii) it is earlier terminated as provided herein.

3.  Base Salary.  The base salary shall be $475,000 per fiscal year, prorated for fiscal year 2009 ($296,875 for remainder of fiscal year 2009); paid monthly in accordance with the Company’s standard payroll practices.

4.  Signing Equity Payment.  Employee shall receive a signing equity payment of 50,000 nonqualified options to be granted on Monday, August 18, 2008, with an exercise price equal to the fair market value of the Company’s common stock at the close of trading on such date.  The nonqualified options shall be issued from one of the Company’s existing shareholder approved option plans, have a term of 5 years and vest in 4 equal annual installments and have such other terms and conditions as those contained in the Company’s standard stock option grant agreements as filed with the SEC.

5.  Bonus Opportunity.  Employee shall be eligible for cash bonus and equity bonus amounts in accordance with the principles, terms and conditions  of the Company’s existing 2009 Bonus Compensation Plan as filed with the SEC, provided, however, (i) the maximum cash bonus amount shall be $475,000 prorated for fiscal year 2009 ($296,875 for remainder of fiscal year 2009) and (ii) the maximum number of options which may be earned is 50,000 prorated for

fiscal year 2009 (31,250 options for remainder of fiscal year 2009) and (iii) the required number of acquisitions shall be prorated ( 1 acquisition for the remainder of fiscal year 2009).

6.  Vacation. Vacation shall be 3 weeks per year prorated for fiscal year 2009 (9 business days for remainder of fiscal year 2009).

7.  Change of Control Provisions.  All options granted to Employee in accordance with Section 4 above shall immediately vest upon (i) a sale of substantially all of the equity or assets of the Company or a merger where the beneficial owners of the Company’s equity securities immediately prior to such merger no longer constitute a majority of the beneficial ownership immediately thereafter (a “Sale Transaction”); and (ii) Employee agrees to be employed by the buyer in such Sale Transaction for a period of no less than one year after the closing thereof.  If upon a Sales Transaction, Employee is not offered a position with the buyer in such Sales Transaction, Employee shall be paid a lump sum equal to one year’s base salary as then in effect.

8.  Termination Without Cause; Notice of Early Termination.

(a)              If the Company should terminate Employee’s employment without “cause” as may be determined by the Board of Directors, then Employee shall be entitled to receive from the Company upon the date of such termination a lump sum payment equal to (i) one year’s base salary as then in effect, and (ii) a pro-rated cash bonus equal to that percentage of the fiscal year completed at the date of your termination multiplied by the cash bonus actually earned under the Company’s fiscal year compensation plan as filed with the SEC payable to the CEO of the Company at the end of such fiscal year (for example, if Employee’s employment is terminated 50% through the fiscal year, then if the Company’s performance for the entire fiscal year would require a cash bonus payment to the CEO of $50,000 for such entire year, Employee would be paid $25,000); such payment to be made upon the date other bonuses are actually paid under the then existing compensation plan.  As used herein, the term “cause” shall mean (i) Employee’s willful breach or neglect of the duties and obligations required of him either expressly or impliedly by the terms of this Agreement (including, but not limited to refusal to execute Employer’s standard confidential information agreement); or (ii) Employee’s commission of fraud, embezzlement or misappropriation, involving the Company whether or not a criminal or civil charge is filed in connection therewith.

(b)              In the event Employee or the Company elects to terminate Employee’s employment with the Company, he/it, as the case may be, shall provide no less than 30 days written notice prior to the effective date of such termination.

9.  Expenses.  In addition to the salary provided in Section 3, Employee shall be entitled to reimbursement for necessary and reasonable business expenses incurred in connection with the performance of his duties hereunder pursuant to procedures and policies adopted by the Board of Directors of Employer.

10.  Faithful Execution of Duties.  Employee agrees that so long as he shall be an employee pursuant to this Agreement, he shall perform his services hereunder faithfully, diligently and to the best of his skill and ability, and he shall devote full time and interest to the

business and affairs of Employer. Employee also agrees that during such period he shall not, without Employer’s prior written consent, engage in any employment or any business other than for Employer, which consent shall not be unreasonably withheld.

11.  Board Approval Required.  This agreement is subject to approval by the Board of Directors of the Company.

12.General Provisions.

12.1Notices.  All notices and other communications hereunder shall be in writing and, unless otherwise provided herein, shall be deemed to have been duly given if delivered or mailed, first class postage prepaid:

(i)	If to Employer:
	Quality Systems, Inc.
	18111 Von Karman, Suite 600
	Irvine, CA   92612
	Attention: Chief Financial Officer
(ii)	If to Employee:
	Steven Plochocki
	17 Flagstone
	Coto de Caza, CA  92679

12.2Assignment. The rights and duties of Employee under this Agreement shall not be subject to alienation, assignment or transfer, whether voluntary or involuntary. Employer, however, may assign this Agreement to any corporation that may succeed to the business and assets of Employer, and any such successor corporation may similarly assign this Agreement, provided that any such assignee expressly assumes all obligations of Employer hereunder.

12.3Entire Agreement. This Agreement constitutes the entire agreement between the parties pertaining to the subject matter hereof, and no changes in, additions to or modifications of this Agreement shall be valid unless set forth in writing and signed by each of the parties.

12.4Supersedes Prior Agreements. This Agreement cancels and supersedes all prior employment agreements, oral or written, between Employer and Employee.

12.5Captions. The captions used in this Agreement are intended solely for convenience of reference and shall not in any manner amplify, limit, modify or otherwise be used in the construction or interpretation of any of the provisions hereof.

12.6Severability. If any term of this Agreement or any application thereof shall be invalid, illegal or unenforceable in any respect, the validity, legality and enforceability

of the remaining terms contained herein and any other application of said terms shall not in any way be affected or impaired thereby.

12.7Applicable Law. This Agreement shall be construed and enforced in accordance with and governed by the laws of the State of California. In the event of litigation arising out of this Agreement, jurisdiction shall be proper either in the State of California or in the State in which Employee is employed.

12.8Legal Action and Fees. In the event of any controversy, claim or dispute between the parties hereto arising out of or relating to this Agreement, the prevailing party shall be entitled to recover from the nonprevailing party his reasonable expenses, including, but not limited to, reasonable attorneys’ fees.

IN WITNESS WHEREOF, the undersigned have executed this Agreement on the date first above written.

EMPLOYER:   QUALITY SYSTEMS, INC. a California corporation   By: /s/ Paul Holt Its: Chief Financial Officer EMPLOYEE: /s/ Steven Plochocki Steven Plochocki

EX-99.1

Exhibit 99.1

Press Release Source: Quality Systems, Inc.

QUALITY SYSTEMS, INC. NAMES STEVEN T. PLOCHOCKI PRESIDENT AND CHIEF EXECUTIVE OFFICER

Veteran Healthcare Executive Brings Extensive Industry Experience and Knowledge of Quality Systems to His New Post

IRVINE, Calif – August 12, 2008 – Quality Systems, Inc. (NASDAQ: QSII) today announced it has appointed Steven T. Plochocki as President and Chief Executive Officer of the company effective August 16, 2008.  In addition to his distinguished career in the healthcare sector, Mr. Plochocki has served on the Board of Directors of Quality Systems since 2004, giving him insight into the company, its operations and its growth strategy.  As a member of Quality Systems' management team, Mr. Plochocki will be a non-independent director and accordingly has resigned from the company's Audit Committee, Compensation Committee and the Independent Directors’ Compensation Committee.Mr. Plochocki replaces Louis Silverman, who announced in June his intention to step down as CEO.

Mr. Plochocki, 56, has worked in the healthcare industry virtually his entire professional career and served as CEO of four companies, two of which were publicly traded. Mr. Plochocki has a proven history of guiding small and mid-market companies through a variety of economic cycles while building value for their shareholders. He most recently served as Chairman and CEO of Omniflight Helicopters, Inc., the second-largest air medical services provider in the country, where he oversaw a restructuring of the company’s operations and achieved 20% EBITDA margins that ranked among the sector’s best. He also has significant experience working within healthcare product and service companies, having run operations at a $50 million healthcare billing company, Centratex, as well as at Apria Healthcare, the nation’s largest home healthcare company and at Apria’s predecessor, Abbey Healthcare Group, a $450 million home healthcare company which merged with Homedco Group to form Apria. During his tenure at InSight Health Services Corp., the nation’s largest provider of diagnostic imaging services, the company doubled in size and its share price increased by nearly 250%.

“I am thrilled to be joining Quality Systems in this new capacity, particularly after having spent the last four years watching this company successfully execute on its strategic vision and grow into the market leader,” said Mr. Plochocki. “Quality Systems has established considerable momentum and I believe this company has the vision and a solid strategic plan to continue providing attractive returns to our shareholders while providing the industry’s finest management and electronic records products and services. I look forward to partnering with NextGen’s Patrick Cline and QSI’s Donn Neufeld in this effort and am eager to get started.”

Sheldon Razin, Chairman of the Board of Quality Systems, said, “Steve brings considerable experience and leadership to this company and is well-qualified to guide Quality Systems through the next chapter of its growth.  As a Board member, he has

offered insightful perspective about the industry and has been an engaged, committed member of our team.  Steve understands our company, believes in its potential and possesses the ideal balance of management expertise and sector experience to take this company to new heights.”

Patrick Cline, President of the company’s NextGen Healthcare subsidiary, said “I look forward to working with Steve to take the company to its next level of growth.  We both share a common belief in this company’s potential to continue to capitalize on our strong position in this dynamic and rapidly growing market.”

Mr. Plochocki has received numerous industry accolades, including being the only executive to win two national American Business Awards for best business turnarounds. He also received the Ernst & Young Entrepreneur of The Year award in the health services category in 2002. He holds an M.B.A. from Central Michigan University and currently lives in Orange County, CA.

About Quality Systems, Inc.

Quality Systems, Inc. and its NextGen Healthcare Information Systems subsidiary develop and market computer-based practice management, patient records, and connectivity and other applications and services for medical and dental group practices. Visit www.qsii.com and www.nextgen.com for additional information.

SAFE HARBOR PROVISIONS FOR FORWARD-LOOKING STATEMENTS:

Statements made in this release, the proxy statements filed with the Securities and Exchange Commission (“Commission”), communications to shareholders, press releases and oral statements made by our representatives that are not historical in nature, or that state our or management’s intentions, hopes, beliefs, expectations or predictions of the future, may constitute “forward-looking statements” within the meaning of Section 21E of the Securities and Exchange Act of 1934, as amended. Forward-looking statements can often be identified by the use of forward-looking terminology, such as “could,” “should,” “will,” “will be,” “will lead,” “will assist,” “intended,” “continue,” “believe,” “may,” “expect,” “hope,” “anticipate,” “goal,” “forecast,” “plan,” or “estimate” or variations thereof or similar expressions. Forward-looking statements are not guarantees of future performance.

Forward-looking statements involve risks, uncertainties and assumptions. It is important to note that any such performance and actual results, financial condition or business, could differ materially from those expressed in such forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, the risk factors discussed under “Risk Factors” in our Annual Report on Form 10-K for fiscal year ended March 31, 2008, as well as factors discussed elsewhere in this and other reports and documents we file with the Commission. Other unforeseen factors not identified herein could also have such an effect. We undertake no obligation to update or

revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes in future operating results, financial condition or business over time unless required by law. Interested persons are urged to review the risks described under “Risk Factors” and in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for fiscal year ended March 31, 2008, as well as in our other public disclosures and filings with the Commission.

On August 4, 2008, Quality Systems filed its definitive proxy statement and began the process of mailing its definitive proxy statement, together with a WHITE proxy card. Shareholders are strongly advised to read Quality System’s proxy statement as it contains important information. Shareholders may obtain an additional copy of Quality System’s definitive proxy statement and any other documents filed by Quality Systems with the Commission for free at the Internet website maintained by the Commission at www.sec.gov. Copies of Quality Systems proxy materials may be requested by contacting our proxy solicitor, MacKenzie Partners, Inc. at (800) 322-2885 toll-free or by email at qualitysystems@mackenziepartners.com. Detailed information regarding the names, affiliations and interests of individuals who are participants in the solicitation of proxies of Quality System's shareholders is available in Quality System's definitive proxy statement filed with the Commission on August 4, 2008.

Contact:

Quality Systems, Inc.

Paul Holt, CFO

949-255-2600

www.qsii.com

or

CCG Investor Relations

Sean Collins, Senior Partner

310-477-9800

www.ccgir.com