2007 Business Unit Management Incentive Plan



 Exhibit 10.03 
 Macrovision Corporation 
 2007 Business Unit Management Incentive Plan 
  

	I.	INTRODUCTION 

 a. The Objective of the 2007 Business Unit Management
Incentive Plan (the “Plan”) is to (i) enhance stockholder value by promoting strong linkages between executive contributions and company performance; (ii) support achievement of the business objectives of Macrovision Corporation
and its subsidiaries (the “Company”); and (iii) promote retention of participating employees of the Company. 
 b. Participants: This
plan applies solely to (i) the senior executives reporting directly to the Chief Executive Officer in charge of the Distribution and Commerce, Entertainment, Embedded Solutions and Software Business Units (each a “Business Unit”), and
(ii) the persons listed on Schedule B hereto who are assigned to support a specific Business Unit. Employees otherwise participating in the Sales Compensation Plan Fiscal 2007 or the 2007 Services bonus plan of Macrovision Corporation and its
subsidiaries are not eligible for the Plan. 
 c. Effective Date: This Plan is effective for the second half of fiscal year 2007, beginning
July 1, 2007 through December 31, 2007. This Plan is limited in time and expires automatically on December 31, 2007. All benefits under this Plan are voluntary benefits. Participation in this Plan during fiscal year 2007 does not
convey any entitlement to participate in this or future plans or to the same or similar bonus payment benefits. 
 d. Changes in the Plan: The Company
presently has no plans to change the Plan during the fiscal year. However, this plan is a voluntary benefit provided by the Company and by virtue of the fact that bonuses are not a contractual entitlement and are paid at the sole discretion of the
Company, the Company reserves the right to modify the Plan, in total or in part, at any time. Any such change must be in writing and approved by the Compensation Committee of the Board of Directors. The Compensation Committee of the Board of
Directors and Plan implementers (CEO, CFO and EVP, Human Resources) reserve the right to interpret the Plan document as needed and such interpretations shall be final, conclusive and binding on all persons, and shall be given the maximum deference
permitted by law. 
 e. Entire Agreement: This Plan is the entire agreement between the Company and the employee regarding the subject matter of this
Plan and supersedes all prior bonus or commission incentive plans (including but not limited to the 2007 Senior Executive Company Incentive Plan, the 2007 Company Incentive Plan, the Sales Compensation Plan Fiscal 2007 and the 2007 Services bonus
plan) with respect to the second half of fiscal year 2007, whether with Macrovision or any subsidiary or affiliate thereof, or any written or verbal representations regarding the subject matter of this Plan. 








	II.	ELIGIBILITY AND INCENTIVE PLAN ELEMENTS 

 a. Eligibility: The
participants are eligible for the incentive payout if they meet the following requirements: 
  

	 	•	 	 Except as otherwise explicitly set forth in the Participant’s Incentive Target Percentage Schedule (as defined in Section II below), are not currently on a
sales incentive or commission plan or any other significant form of variable compensation (such as a services bonus plan) 


  

	 	•	 	 Have a performance rating of Needs Development or above 


  

	 	•	 	 Do not have a performance rating of Unsatisfactory at the time of calculation 


  

	 	•	 	 Are not on a performance improvement plan at the time of calculation 


  

	 	•	 	 Have not received a written notice of warning or other disciplinary action during the year that remains in effect at the time of calculation



 AND 
 The participant must be
employed in an incentive-eligible position on or before the first working day of the last fiscal quarter of fiscal year 2007 and must be employed by the Company on the day the bonus is paid to be eligible for a 2007 incentive payment. Participants
will be paid their 2007 incentive payment (if any) no later than March 15, 2008. Participants in the Plan with less than one year of service will be eligible for a prorated incentive amount as set forth in Proration Factor below. In no event
will any individual accrue any right or entitlement to any incentive under this Plan unless that individual is employed by the Company on the day the bonus is paid. 
 Any exception to the above must be approved in writing by the Company’s Compensation Committee. 
 b. The Annual Base
Salary in effect at the end of the fiscal year represents the basis for the incentive calculation. Nothing in the Plan, or arising as a result of a Participant’s participation in the Plan, shall prevent the Company from changing a
Participant’s Annual Base Salary at any time based on such factors as the Company in its sole discretion determines appropriate. 
 c. Business Unit
Performance Factor is based upon the Participant’s Business Unit achieving an established worldwide revenue target and a worldwide contribution profit target for the second half of 2007 per the 2007 second half Business Unit operating
plan approved by the Board of Directors of the Company. The applicable targets for the second half of fiscal year 2007 can be amended by the Compensation Committee of the Board of Directors at any time during the fiscal year. Notwithstanding
anything to the contrary contained herein, the Compensation Committee has the discretion to determine to pay less than the full amount (including to pay zero percent) of the payout to which any Participant would otherwise be entitled, which
determination shall be based upon such factors as the Compensation Committee determines appropriate (including without limitation as a result of the Company’s, Business Unit’s or a 








 
Participant’s failing to achieve one or more objectives with respect to the fiscal year). When the revenue and contribution profit percentages fall
between the stated percentages on the matrix, the Business Unit Performance Factor will be determined using a straight-line interpolation approach. If the Business Unit (a) exceeds 120% of Revenue and/or 140% of Contribution Profit or
(b) does not achieve 85% of Revenue and/or 85% of Contribution Profit, the Business Unit Performance Factor will be determined using a straight-line extrapolation approach, provided however that the Business Unit Performance Factor may be
modified at the sole discretion of the Compensation Committee of the Board of Directors for any reason, including in the event that such Business Unit performance is due to an extraordinary or exceptional circumstance. 
  

																					
	 Revenue as a %
 of Goal
	  	120%	 	.70	 	 	1.00	 	 	1.20	 	 	1.50	 	 	1.75	 	 	2.00	 
	  	115%	 	.70	 	 	1.00	 	 	1.18	 	 	1.44	 	 	1.68	 	 	1.94	 
	  	110%	 	.70	 	 	1.00	 	 	1.16	 	 	1.38	 	 	1.61	 	 	1.88	 
	  	105%	 	.70	 	 	1.00	 	 	1.14	 	 	1.32	 	 	1.54	 	 	1.82	 
	  	100%	 	.65	 	 	1.00	 	 	1.12	 	 	1.26	 	 	1.47	 	 	1.76	 
	  	85%	 	.50	 	 	0.90	 	 	1.10	 	 	1.20	 	 	1.40	 	 	1.70	 
	  		 	85	%	 	100	%	 	110	%	 	120	%	 	130	%	 	140	%

 Contribution Profit as a % of Goal 
  

			
	 Example:
	    	Business Unit Performance
	 	    	Actual Revenue is 110% of Goal
		    	Actual Contribution Profit is 120% of Goal

 Business Unit Performance Factor = 1.38 
 d. Incentive Target Percentage is a percentage level of base salary determined by the employee’s position. These targets will be weighted by company,
business unit and individual performance and customer satisfaction performance, with a greater incentive percentage weighted toward company and business unit performance the higher the position in the Company, and will be set forth in an Incentive
Target Percentage Schedule for each Participant in substantially the form attached hereto as Schedule A. 
 e. Individual Performance Factor
(“IPF”) is based upon the manager’s evaluation of performance and contribution for the fiscal year. As a Factor to the incentive target for the position, this factor can range from 0 to 150%. 
 f. Macrovision Corporation Performance Factor is based upon the Company achieving an established worldwide revenue target and a worldwide operating profit target
per the 2007 operating plan approved by the Board of Directors of the Company. The applicable targets for fiscal year 2007 can be amended by the Compensation Committee of the Board of Directors at any time during the fiscal year. 







 
Notwithstanding anything to the contrary contained herein, the Compensation Committee has the discretion to determine to pay less than the full amount
(including to pay zero percent) of the payout to which any Participant would otherwise be entitled, which determination shall be based upon such factors as the Compensation Committee determines appropriate (including without limitation as a result
of the Company’s or a Participant’s failing to achieve one or more objectives with respect to the fiscal year). When the Revenue and operating profit percentages fall between the stated percentages on the matrix, the Performance Factor
will be determined using a straight-line interpolation approach. If the Company (a) exceeds 120% of Revenue and/or 140% of Operating Profit or (b) does not achieve 85% of Revenue and/or 85% of Operating Profit, the Company Performance
Factor will be determined using a straight-line extrapolation approach, provided however that the Company Performance factor may be modified at the sole discretion of the Compensation Committee of the Board of Directors for any reason, including in
the event that such Company Performance is due to an extraordinary or exceptional circumstance. 
  

																					
	 Revenue as a %
 of Goal
	  	120%	 	.70	 	 	1.00	 	 	1.20	 	 	1.50	 	 	1.75	 	 	2.00	 
	  	115%	 	.70	 	 	1.00	 	 	1.18	 	 	1.44	 	 	1.68	 	 	1.94	 
	  	110%	 	.70	 	 	1.00	 	 	1.16	 	 	1.38	 	 	1.61	 	 	1.88	 
	  	105%	 	.70	 	 	1.00	 	 	1.14	 	 	1.32	 	 	1.54	 	 	1.82	 
	  	100%	 	.65	 	 	1.00	 	 	1.12	 	 	1.26	 	 	1.47	 	 	1.76	 
	  	85%	 	.50	 	 	0.90	 	 	1.10	 	 	1.20	 	 	1.40	 	 	1.70	 
	  		 	85	%	 	100	%	 	110	%	 	120	%	 	130	%	 	140	%

 Operating Profit as a % of Goal 
  

			
	 Example:
	    	Macrovision Corporation Performance
	 	    	Actual Revenue is 110% of Goal
		    	Actual Operating Profit is 120% of Goal

 Macrovision Corporation Performance Factor = 1.38 
 g. Customer Satisfaction Factor: The Customer Satisfaction Factor is based upon an improvement against the Company’s 2006 Customer Satisfaction Survey Score.
Depending upon the amount of improvement in such Score, the Customer Satisfaction Factor will represent up to 5% of the Incentive Target Percentage at target. 
 h. Transfers and Terminations: Any employee who is a participant in the Plan and who transfers to a new position not governed by this Plan will be eligible on a pro-rata basis for the applicable period and paid as defined by the
Plan. Employees who transfer into the Plan from another plan will be subject to proration as well, and consequently will be eligible to receive an incentive payment based on their participation in this Plan during fiscal year 2007 applying the
Proation Factors referred to below. Payments from the Plan are subject to reduction by advances, unearned commission advances, draws or prorations and appropriate withholdings. Any exceptions to the Plan must be in writing and approved by the
Compensation Committee. 







 A participant must be employed as of the day the bonus is paid to be eligible for the year-end incentive. If an employee
terminates prior to the date the bonus is paid, the employee will not be eligible for such incentive payment. 
 i. Proration Factor accounts for the
number of calendar days during the second half of the fiscal year that the employee is in the incentive-eligible position. For example, the proration factor for an employee who has been on the Plan the entire second half of the year will be 1.00.
For an employee who has been on the plan for 3 months, the factor will be 0.50. Employees in the following situations will have a Proration Factor of less than 1.00: 
  

	 	•	 	 Participants in the Plan who transferred to a new position not covered by the Plan 


  

	 	•	 	 Employees who transferred from one incentive-eligible position to another incentive-eligible position. Employees in this situation will have their incentive
prorated based on the length of time in each position. 


  

	 	•	 	 Employees who have been in the Plan less than 6 months (such as a new hire) 


  

	 	•	 	 Employees who have been on a leave of absence of any length during the second half of the fiscal year 


  

	 	•	 	 Employees working less than the full time standard work week will receive an incentive prorated according to the following schedule: 



 

			
	 Hours Worked
	  	 Incentive Eligibility

	Less than full time > half time as defined by standard work week	  	Prorated according to the average number of hours worked
	Less than half time of standard work week	  	Not incentive eligible

 Any modification to the above schedule must be approved by the Chief Executive Officer, the Chief Financial
Officer and Human Resources in advance of the year end close date. 
  

	III.	PRACTICES AND PROCEDURES 

 a. Procedure: 
  

	 	•	 	 A copy of the Plan will be made available to each participant. 


  

	 	•	 	 All incentive payments will be made after all required or elected withholdings have been deducted. 


 b. Governing Law: This Plan is governed by the law of California and the parties hereby submit to the exclusive jurisdiction of the County of Santa Clara,
California courts. 







 SCHEDULE A 
 INCENTIVE TARGET PERCENTAGE SCHEDULE 
  

																						
	 Position
	  	 Target
 as %
of
 Base
 Salary
	 	 	Corporate
Revenue
Component	 	 	Corporate
Operating
Profit
Component	 	 	Business
Unit
Revenue
Component	 	 	Business
Unit
Contribution
Profit
Component	 	 	Individual
Performance	 	 	Customer
Satisfaction	 
	 Name, Title
	  	XX	%	 	XX	%	 	XX	%	 	XX	%	 	XX	%	 	XX	%	 	XX	%








 SCHEDULE B 
 LIST OF INDIVIDUALS ASSIGNED TO SUPPORT SPECIFIC BUSINESS UNITS 
  

																						
	 Position
	  	 Target
 as %
of
 Base
 Salary
	 	 	Corporate
Revenue
Component	 	 	Corporate
Operating
Profit
Component	 	 	Business
Unit
Revenue
Component	 	 	Business
Unit
Contribution
Profit
Component	 	 	Individual
Performance	 	 	Customer
Satisfaction	 
	 Name, Title
	  	XX	%	 	XX	%	 	XX	%	 	XX	%	 	XX	%	 	XX	%	 	XX	%