Quality Systems

Company: Quality Systems, Inc., Irvine, CA
Entry Submitted By: PAIRELATIONS, LLC
Company Description: Irvine, Calif.-based Quality Systems, Inc. and its NextGen Healthcare Information Systems subsidiary develop and market computer-based practice management, patient records and revenue cycle management applications as well as connectivity products and services for medical and dental group practices. Visit www.qsii.com and www.nextgen.com for additional information.
Nomination Category: Management Categories
Nomination Sub Category: Chairman of the Year

Nomination Title: SHELDON RAZIN: VISIONARY, ENTREPRENEUR AND HEALTHCARE INFORMATION TECHNOLOGY PIONEER

Tell the story about what this nominee achieved since January 1 2008 (up to 500 words). Focus on specific accomplishments, and relate these accomplishments to past performance or industry norms. Be sure to mention obstacles overcome, innovations or discoveries made, and outcomes:

Since Sheldon Razin was 10, he dreamed of starting his own company. 

Razin founded Quality Systems, Inc. (QSI) in 1973 (incorporated 1974) with
$2000 and has been chairman since.  QSI provided computer consulting services
but its electronic systems for automating dental practices put it on the map. 
It pioneered the first turn-key dental practice system for automating/managing
all administrative functions.  Eventually, it led the industry, capturing 90%
market share. 

For the 10-year period ended January 1, 2009, Motley Fool ranked QSI third best
top-performing stock on Wall Street, appreciating 4,133%. 

QSI went public in 1982 with 110 employees and $10 million in revenue.  The IPO
raised $10.2 million and shares traded on NASDAQ (QSII) @ $17.  Today, it
trades near $50 per share, which, when taking into account three 2-for-1 stock
splits, is equivalent to $320 per share.  The company hasn’t been infused with
venture capital and grew organically and through acquisitions. 

Razin’s vision to transform healthcare IT through automation of patient
electronic medical records (EMR) was soon realized.  He neared his goal of
becoming a $100 million entity with the acquisition of two key EMR acquisitions
in 1996 and 1997.  These transformed the enterprise into a leading EMR
provider.  In 2008, QSI acquired two complimentary companies within the sector
with cash. 

But 2008 also brought challenges.  Razin never feared – triumphing through:

•Increased competition
•Pricing pressures
•Proxy fight by dissident shareholder -- all four independent proxy advisory
firms found in favor of QSI management.
•Operational restructuring in sales, implementation and training to accommodate
QSI’s explosive growth (once a $25 million entity, now $250 million)
•Assimilating two self-funded acquisitions
•Restructuring of senior management/appointment of new CEO
•Reorganization of Board and various corporate governance committees

QSI’s major milestones:

•Revenue run rate of $260 million at fiscal 2009 third quarter. 
•Market capitalization of $1+ billion versus $70 million at IPO.
•Pre-tax income of $63 million for fiscal year 2008 ($55 million for first nine
months of 2009).
•Net after-tax margins of approximately 20% in calendar 2008, among the
sector’s highest.
•Compounded annual growth rates of 28, 39 and 27% in revenue, earnings per
share and cash flow from operations, respectively.
•Dividend program paying $1.20 per share or roughly $33 million annually, a
yield of 3+%.
•Strong cash position – No debt-$72 million in cash/cash equivalents.
•Stock appreciation of 870+% since IPO.
•Consistently ranked among America’s fastest growing companies by Fortune,
Business Week, Business 2.0 and Forbes (ranked fourth fastest growing small
company in 2008)
•In 2008, QSI shares were up 40% while NASDAQ was down 40%.  QSI one of six
positive NASDAQ stocks.

Razin never stopped chasing his dream – building a world-class enterprise with
the highest standards of excellence whose products make a difference.  QSI
stands to significantly benefit from Obama’s stimulus plan, dictating all
physicians function on EMR by 2014.  Razin never envisioned healthcare IT to be
a major initiative of this Administration, which could take the company to new
heights. 

List hyperlinks to any online news stories, press releases, or other documents that support the claims made in the section above. IMPORTANT: Begin each link with http://, and enclose each link in square brackets; for example, [http://www.youraddress.com]:

http://qsii.com/investor/press_cover/pc_040509.pdf
http://qsii.com/investor/press_cover/pc_020209.pdf
http://investor.shareholder.com/ceosignature/webcast.cfm?mediaid=36184&k=F84A2E201E01D14BA59F76FDFB4318FC
http://qsii.com/investor/pressreleases/pr_012909.pdf
http://qsii.com/investor/press_cover/pc_032409.pdf
http://qsii.com/investor/press_cover/pc_032409.pdf
http://qsii.com/investor/pressreleases/pr_021709.pdf
http://qsii.com/investor/pressreleases/pr_120108.pdf

Provide a brief (up to 100 words) biography about the nominee:

Sheldon Razin is the founder of Quality Systems, Inc. and has served as its
Chairman of the Board since the Company’s incorporation in 1974 (inception
1973). He served as the Company’s Chief Executive Officer from 1974 until April
2000. Since its inception until April 2000, he has also served as the Company’s
President, with the exception of the period from August 1990 to August 1991.
Additionally, Razin served as Treasurer from the Company’s inception until
October 1982. Prior to founding the Company, Razin held various technical and
managerial positions with Rockwell International Corporation and was a founder
of the Company’s predecessor, Quality Systems, a sole proprietorship engaged in
the development of software for commercial and space applications and in
management consulting work. Razin holds a B.S. degree in Mathematics from the
Massachusetts Institute of Technology.