Document:

Exhibit 10.1

 

LIMITED WAIVER AND FIRST AMENDMENT
TO AMENDED AND RESTATED

 CREDIT AGREEMENT AND AMENDED AND RESTATED MANAGEMENT FEE 

SUBORDINATION AGREEMENT

 

This LIMITED
WAIVER AND FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT AND AMENDED AND RESTATED MANAGEMENT FEE SUBORDINATION
AGREEMENT (this “Amendment”) is entered into as of September 3, 2019, by and among the
Lenders, COMVEST CAPITAL IV, L.P., as agent for the Lenders (the “Agent”), VINTAGE STOCK,
INC., a Missouri corporation (the “Borrower”), and acknowledged and agreed to by VINTAGE STOCK
AFFILIATED HOLDINGS LLC, a Nevada limited liability company and sole equity holder of the Borrower (the
“Parent”), and, other than with respect to Sections 2, 3, 8(a) and 12 of this Amendment, LIVE VENTURES
INCORPORATED, a Nevada corporation (the “Sponsor”).

 

W I T N E S S E T H

 

WHEREAS, the Borrower,
the Parent, the Lenders from time to time party thereto and Agent are party to that certain Amended and Restated Credit Agreement,
dated as of June 7, 2018 (as amended, restated, supplemented, or otherwise modified from time to time, the “Credit Agreement”);

 

WHEREAS, the Agent,
the Sponsor, Parent and the Borrower are party to that certain Amended and Restated Management Fee Subordination Agreement, dated
as of June 7, 2018 (as amended, restated, supplemented, or otherwise modified from time to time, the “Management Fee Subordination
Agreement”);

 

WHEREAS, Sponsor
entered into to that certain Limited Guaranty, dated as of June 7, 2018 in favor of Agent (as amended, restated, supplemented,
or otherwise modified from time to time, the “Sponsor Guaranty”);

 

WHEREAS, the Borrower
has failed to comply with (x) Section 5.15 of the Credit Agreement for the Fiscal Quarter ending June 30, 2019, which resulted
in an Event of Default under Section 7.01(d) of the Credit Agreement (the “Debt Contribution Default”), and
(y) Section 6.18(b) of the Credit Agreement for the Fiscal Quarter ending June 30, 2019, which resulted in an Event of Default
under Section 7.01(c) of the Credit Agreement (the “Leverage Ratio Default” and, together with the Debt Contribution
Default, the “Specified Events of Default”); and

 

WHEREAS, the Borrower
(i) proposes to make certain amendments to the Credit Agreement and the Management Fee Subordination Agreement and (ii) requests
that the Agent and Lenders waive the Specified Events of Default, and the Agent and the Lenders are willing to agree to make such
amendments and waive the Specified Events of Default, in each case, on the terms and conditions set forth herein.

 

NOW, THEREFORE,
in consideration of the foregoing and the mutual covenants herein contained, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows:

 

1.     
Defined Terms. Each capitalized term used herein and not defined herein shall have the meaning ascribed to
such term in the Credit Agreement as amended hereby.

 

2.     
Limited Waiver. Subject to the satisfaction of each of the conditions to effectiveness set forth in Section
5, the Agent and Required Lenders hereby irrevocably waive the Specified Events of Default and all rights and remedies under
the Credit Agreement and the other Loan Documents arising as a result of the occurrence and continuance of the Specified Events
of Default; provided that nothing contained herein shall in any way (i) waive, release, modify or limit any Loan Party’s
obligations to otherwise comply with all terms and conditions of any or all of the Credit Agreement (after giving effect to this
Amendment) and the other Loan Documents or (ii) waive, release, modify, hinder, restrict or otherwise limit any or all of Agent’s
or any Lender’s rights, remedies and privileges thereunder following the occurrence of any Default or Event of Default under
the Credit Agreement, other than with respect to the Specified Events of Default.

 

 

 

    
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3.     
Amendments to Credit Agreement.

 

(a)      
Section 5.15 of the Credit Agreement is hereby amended by amending and restating such Section in its entirety to read as
follows:

“Section
5.15Seller Subordinated Debt Contributions. Cause Sponsor to make each Seller Subordinated Debt Contribution to the
Parent for so long as any Seller Subordinated Debt is outstanding, for application in accordance with the Seller Debt Subordination
Agreement; provided, that if the Senior Leverage Ratio is less than 2.25:1.00 as of the last day of the most recently ended
Fiscal Quarter for which financial statements have been delivered pursuant to Section 5.04(b), the Sponsor shall not be
required to make, and the Loan Parties shall not be required to cause the Sponsor to make, any Seller Subordinated Debt Contribution
to the Parent until such time as the Senior Leverage Ratio is greater than or equal to 2.25:1.00 as of the last day of any subsequent
Fiscal Quarter.”

 

(b)      
Section 6.18(b) of the Credit Agreement is hereby amended by amending and restating such Section in its entirety to read
as follows:

 

“(b)     Minimum
EBITDA. At all times that the Senior Leverage Ratio is greater than or equal to 1.50:1.00, permit EBITDA for the twelve
(12) month period ending on the last day of any Fiscal Quarter to be less than $11,500,000.”

 

(c)      
The table set forth in Section 6.18(c) of the Credit Agreement is hereby amended by replacing such table with the table
set forth below:

 

	Fiscal Quarter Ending	 	Senior Leverage 

Ratio
	June 30, 2018 and September 30, 2018	 	2.85:1.00
	December 31, 2018	 	2.65:1.00
	March 31, 2019	 	2.60:1.00
	June 30, 2019	 	2.40:1.00
	September 30, 2019	 	2.40:1.00
	December 31, 2019	 	2.40:1.00
	March 31, 2020	 	2.20:1.00
	June 30, 2020	 	2.10:1.00
	September 30, 2020	 	2.05:1.00
	December 31, 2020	 	1.85:1.00
	March 31, 2021	 	1.60:1.00
	June 30, 2021 and each Fiscal Quarter thereafter	 	1.55:1.00

 

(d)      
Section 6.18(f) of the Credit Agreement is hereby amended by amending and restating such Section in its entirety to read
as follows:

 

“(f)      Maximum
New Store Openings. Establish more than five (5) new retail locations of the Loan Parties in any consecutive twelve (12)-month
period; provided, that no Loan Party may establish any new retail location if, at the time such location is established,
the Borrower is not in compliance on a pro forma basis with the covenants set forth in this Section 6.18 (recomputed as
of the most recently ended Fiscal Quarter for which financial statements have been provided pursuant to Section 5.04(b)).”

 

 

 

    
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4.     
Amendments to Management Fee Subordination Agreement.

 

(a)        
Section 1 of the Management Fee Subordination Agreement is hereby amended by amending and restating the definition “Standstill
Period” to read as follows:

 

““Standstill
Period” shall mean the period beginning on the Closing Date and ending such time as all of the following conditions have
been satisfied (the “Leverage Conditions” and the date the Leverage Conditions are satisfied, the “Leverage
Conditions Date”): (i) the Senior Leverage Ratio as of the last day of any Fiscal Quarter is less than 2.25:1.00 and
(ii) the Borrower has delivered to the Senior Agent an officer’s certificate executed by the Chief Executive Officer or Chief
Financial Officer of the Borrower certifying as to the foregoing subclause (i) and setting forth in reasonable detail the
calculation of the Senior Leverage Ratio as of such date; provided, that if after the Leverage Conditions Date, the Senior
Leverage Ratio as of the last day of any Fiscal Quarter is greater than or equal to 2.25:1.00, the Leverage Conditions shall no
longer be satisfied as of such day.”

 

(b)       
The proviso at the end of Section 2(b)(ii) of the Management Fee Subordination Agreement is hereby amended to read as follows:

 

“1.
(A) no Default or Event of Default has occurred and is continuing or would result from any such Subordinated Payment and (B) both
before and after giving pro forma effect to any such Subordinated Payment, the Loan Parties are in compliance with the financial
covenants set forth in Section 6.18 of the Credit Agreement;

 

2. after
giving pro forma effect to any such Subordinated Payment, Liquidity is greater than or equal to $1,000,000;

 

3. the aggregate
amount of all Subordinated Payments made in any Fiscal Quarter cannot exceed $125,000; and

 

4. the Borrower
shall deliver to the Senior Agent an officer’s certificate executed by the Chief Executive Officer or Chief Financial Officer
of the Borrower certifying as to the foregoing subclauses (i) and (ii) and setting forth in reasonable detail the
calculation of Liquidity on a pro forma basis after giving effect to each such Subordinated Payment.”

 

5.     
Conditions Precedent to Amendment. The satisfaction of each of the following shall constitute conditions precedent
to the effectiveness of this Amendment and each and every provision hereof (the date such conditions precedent are satisfied, the
“First Amendment Effective Date”):

 

(a)      
Agent (or its counsel) shall have received, in form and substance satisfactory to Agent:

 

		(i)	this Amendment duly executed by the Agent, the Lenders party hereto, the Borrower, Parent and Sponsor;

 

		(ii)	a certificate of the Secretary of State or other appropriate governmental official of the jurisdiction
of incorporation or formation, as applicable, of each Loan Party, dated reasonably prior to the First Amendment Effective Date,
stating that such Person is duly formed and in good standing in such jurisdiction; and

 

		(iii)	evidence that the Borrower
has paid to the Agent (i) an amendment fee in the amount of $60,608.97 and (ii) all other fees, expenses and reimbursement amounts
due and payable to the Agent and Lenders (and reasonable evidence of which has been provided to Borrower) have been paid.

 

 

 

    
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(b)      
The representations and warranties in this Amendment shall be true and correct on and as of the date hereof.

 

(c)      
As of the date hereof and after giving effect to the waiver set forth in Section 2, no event shall have occurred
and be continuing or would result from the consummation of the transactions contemplated by this Amendment that would constitute
an Event of Default or a Default.

 

(d)      
As of the date hereof, no Material Adverse Effect shall have occurred and is continuing or would result from the consummation
of the transactions contemplated by this Amendment.

 

(e)      
Agent shall have received such other information, documents, instruments or approvals as Agent or its counsel may reasonably
request.

 

6.     
Sponsor Guaranty. Agent, each Lender, each Loan Party and the Sponsor each hereby acknowledge and agree that,
as of the First Amendment Effective Date, the Sponsor’s Guaranty of the Guaranteed Obligations under Section 1 shall terminate;
provided, that the foregoing termination of the Guaranteed Obligations shall have no effect on the Sponsor’s obligations
under Section 26 of the Sponsor Guaranty and the Sponsor hereby reaffirms its obligations under Section 26 of the Sponsor Guaranty.

 

7.      Governing
Law. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED
AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES (OTHER THAN
SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW).

 

8.     
Representations and Warranties.

 

(a)       
Each Loan Party hereby represents and warrants to Agent and each Lender that:

 

(i)       
at the time of and immediately after giving effect to this Amendment, all representations and warranties set forth in the
Loan Documents are true and correct in all respects on and as of the date of this Amendment, in each case before (other than any
such representations and warranties expressly addressed by the consents or the amendments contained herein) and after giving effect
hereto, except to the extent made as of a specific date (in which case such representations and warranties shall be true and correct
in all respects as of such date);

 

(ii)      
the execution, delivery, and performance by such Loan Party of this Amendment (1) are within such Loan Party’s powers
and have been duly authorized by all necessary action on the part of such Loan Party, (2) do not and will not violate (A) any provision
of any Applicable Law or any order of any court or other agency of government, or (B) any provision of the Organic Documents of
any such Loan Party, or any Contract to which such Loan Party is a party, or by which any such Loan Party or any assets or properties
of any such Loan Party are bound, and (3) do not conflict with, result in a breach of, or constitute (after the giving of notice
or lapse of time or both) a default under, or except for any Lien in favor of Agent, for the benefit of Agent and the other Secured
Persons, as may be provided in the Loan Documents, result in the creation or imposition of any Lien of any nature whatsoever upon
any of the property or assets of Borrower or any other Loan Party pursuant to, any such Organic Document, Contract or otherwise;

 

 

 

    
	 	4	 

     

    

 

(iii)      
this Amendment constitutes such Loan Party’s valid and binding obligation, enforceable against such Loan Party in
accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, fraudulent conveyance, reorganization
or moratorium laws, or other similar laws affecting creditors’ rights and general principles of equity;

 

(iv)      
this Amendment has been duly executed and delivered by such Loan Party; and

 

(v)      
after giving effect to the limited waiver set forth in Section 2, no Default or Event of Default has occurred and
is continuing.

 

(b)      
Sponsor represents and warrants to Agent and each Lender that:

 

(i)       
at the time of and immediately after giving effect to this Amendment, all representations and warranties of the Sponsor
set forth in the Loan Documents are true and correct in all respects on and as of the date of this Amendment, in each case before
(other than any such representations and warranties expressly addressed by the consents or the amendments contained herein) and
after giving effect hereto, except to the extent made as of a specific date (in which case such representations and warranties
shall be true and correct in all respects as of such date);

 

(ii)       
the execution, delivery, and performance by Sponsor of this Amendment (1) are within such Sponsor’s powers and have
been duly authorized by all necessary action on the part of the Sponsor, (ii) do not and will not violate (A) any provision of
any Applicable Law or any order of any court or other agency of government, or (B) any provision of the Organic Documents of Sponsor,
or any Contract to which Sponsor is a party, or by which Sponsor or any assets or properties of Sponsor are bound, and (iii) do
not conflict with, result in a breach of, or constitute (after the giving of notice or lapse of time or both) a default under any
such Organic Document, Contract or otherwise;

 

(iii)      
this Amendment constitutes Sponsor’s valid and binding obligation, enforceable against Sponsor in accordance with
its terms, except as enforceability may be limited by bankruptcy, insolvency, fraudulent conveyance, reorganization or moratorium
laws, or other similar laws affecting creditors’ rights and general principles of equity; and

 

(iv)      
this Amendment has been duly executed and delivered by Sponsor.

 

9.     
Entire Agreement; Effect of Amendment. This Amendment, and the terms and provisions hereof, and the documents
referenced herein, constitute the entire agreement among the parties pertaining to the subject matter hereof and supersede any
and all prior or contemporaneous amendments relating to the subject matter hereof. There are no oral agreements among the parties
pertaining to the subject matter hereof. The Credit Agreement and the other Loan Documents (as amended hereby) shall be and remain
in full force and effect in accordance with its respective terms and hereby is ratified and confirmed in all respects. The execution,
delivery, and performance of this Amendment shall not, except as expressly set forth herein, operate as a consent to, as a waiver
of or as an amendment of, any right, power, or remedy of Agent or any Lender under the Credit Agreement or any other Loan Document,
in each case, as in effect prior to the date hereof. To the extent any terms or provisions of this Amendment conflict with those
of Credit Agreement or other Loan Documents, the terms and provisions of this Amendment shall control. This Amendment is a “Loan
Document” for all purposes.

 

 

 

    
	 	5	 

     

    

 

10.    
Counterparts. This Amendment may be executed in any number of counterparts, all of which taken together shall
constitute one and the same instrument and any of the parties hereto may execute this Amendment by signing any such counterpart.
Delivery of an executed counterpart of this Amendment by facsimile or other electronic method of transmission shall be equally
as effective as delivery of an original executed counterpart of this Amendment. Any party delivering an executed counterpart of
this Amendment by facsimile also shall deliver an original executed counterpart of this Amendment, but the failure to deliver an
original executed counterpart shall not affect the validity, enforceability, and binding effect of this Amendment.

 

11.    
Reaffirmation. Each of Loan Party and Sponsor hereby (a) acknowledges and reaffirms its obligations to Agent
and each Lender under any Loan Document (as amended hereby) to which it is a party and (b) agrees that each of the Loan Documents
(as amended, modified or waived hereby) to which it is a party shall remain in full force and effect.

 

12.   
Ratification of Security Interests and Liens. Each Loan Party hereby confirms and agrees that: (a) all security
interests and Liens granted to the Agent pursuant to the Loan Documents continue in full force and effect and (b) all Collateral
remains free and clear of any Liens other than Liens in favor of Agent and other Permitted Liens. Nothing herein contained is intended
to impair the validity, priority and extent of Agent’s security interest in and Liens upon the Collateral.

 

13.   
Further Assurances. Each party hereto agrees to take such action and execute, acknowledge and deliver, at
their sole cost and expense, such agreements, instruments or other documents as may be reasonably necessary to carry out the intent
of this Amendment.

 

14.   
Miscellaneous.

 

(a)      
Upon the effectiveness of this Amendment, each reference in the Credit Agreement or the Management Fee Subordination Agreement,
as applicable, to “this Agreement”, “hereunder”, “herein”, “hereof” or words of
like import referring to the Credit Agreement or the Management Fee Subordination Agreement, as applicable, shall mean and refer
to the Credit Agreement or the Management Fee Subordination Agreement, as applicable, as amended by this Amendment.

 

(b)     
Upon the effectiveness of this Amendment, each reference in any Loan Document to the “Credit Agreement” or “Management
Fee Subordination Agreement” as applicable, “thereunder”, “therein”, “thereof” or words
of like import referring to the Credit Agreement or the Management Fee Subordination Agreement, as applicable, shall mean and refer
to the Credit Agreement or the Management Fee Subordination Agreement, as applicable, as amended by this Amendment.

 

(c)      
This Amendment shall not constitute a modification of the Credit Agreement or any other Loan Document or a course of dealing
with Agent or any Lender at variance with the Credit Agreement such as to require further notice by Agent or any Lender to require
strict compliance with the terms of the Credit Agreement and the other Loan Documents in the future, except as expressly set forth
herein.

 

15. 
RELEASE. IN CONSIDERATION OF THE AMENDMENTS CONTAINED HEREIN THE SUFFICIENCY OF WHICH IS HEREBY ACKNOWLEDGED,
EACH Loan Party AND SPONSOR HEREBY IRREVOCABLY RELEASES AND FOREVER DISCHARGES AGENT AND EACH LENDER AND EACH OF THEIR RESPECTIVE
AFFILIATES AND ITS OFFICERS, PARTNERS, DIRECTORS, TRUSTEES, EMPLOYEES AND AGENTS (EACH, A “RELEASED PERSON”)
OF AND FROM ALL DAMAGES, LOSSES, CLAIMS, DEMANDS, LIABILITIES, OBLIGATIONS, ACTIONS AND CAUSES OF ACTION WHATSOEVER WHICH ANY SUCH
PERSON MAY NOW HAVE OR CLAIM TO HAVE ON AND AS OF THE DATE HEREOF AGAINST ANY RELEASED PERSON, WHETHER PRESENTLY KNOWN OR UNKNOWN,
LIQUIDATED OR UNLIQUIDATED, SUSPECTED OR UNSUSPECTED, CONTINGENT OR NON-CONTINGENT, AND OF EVERY NATURE AND EXTENT WHATSOEVER WITH
RESPECT TO THE CREDIT AGREEMENT AND THE OTHER LOAN DOCUMENTS AND THE TRANSACTIONS CONTEMPLATED THEREBY, EXCEPT WITH RESPECT TO
OBLIGATIONS UNDER THE LOAN DOCUMENTS TO BE PERFORMED BY ANY RELEASED PERSON AFTER THE DATE OF THIS AMENDMENT (COLLECTIVELY, “CLAIMS”).
EACH Loan Party and SPONSOR EACH HEREBY REPRESENTS AND WARRANTS TO AGENT, DOCUMENTATION
AGENT AND EACH LENDER THAT NO SUCH PERSON HAS GRANTED OR PURPORTED TO GRANT TO ANY OTHER PERSON ANY INTEREST WHATSOEVER IN ANY
CLAIM, AS SECURITY OR OTHERWISE.

 

[Remainder of page intentionally left blank]

 

 

    
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IN WITNESS WHEREOF,
the parties hereto have caused this Amendment to be duly executed by their duly authorized officer as of the day and year first
written above.

 

	 	COMVEST CAPITAL IV, L.P.
	 	as Agent and a Lender
	 	By: ComVest Capital IV Partners, L.P., its General Partner
	 	By: ComVest Capital IV Partners UGP, LLC, its General Partner
	 	 
	 	 
	 	By:  /s/     Greg
    Reynolds                                      
	 	Name:   Greg
    Reynolds                                      
	 	Title:   Partner                                                      
	 	 
	 	COMVEST CAPITAL IV (LUXEMBOURG) 

MASTER FUND, SCSP,
	 	as a Lender
	 	 
	 	By: Comvest Capital Advisors, LLC, as investment manager
	 	 
	 	 
	 	By:  /s/     Greg
    Reynolds                                      
	 	Name:   Greg
    Reynolds                                     
	 	Title:   Partner                                                    

 

	 	VINTAGE STOCK, INC.,
	 	as Borrower
	 	 
	 	By: /s/ Mark A. Szafranowski                         
	 	Name: Mark A. Szafranowski                          
	 	Title: Chief Financial Officer                           

 

 

 

 

    
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	Acknowledged and Agreed:	 
	 	 
		
	VINTAGE STOCK AFFILIATED HOLDINGS LLC,	 
	as Parent	 
	 	 
	 	 
	By: /s/ Jon
    Isaac                                	 
	Name: Jon Isaac                           	 
	Title: President                             
	 
	 	 
	LIVE VENTURES INCORPORATED,	 
	as Sponsor	 
	 	 
	(other than with respect to Sections 2, 3, 8(a) and

 12 of this Amendment)	 
	 	 
	By: /s/ Jon
    Isaac                                	 
	Name: Jon Isaac                           	 
	Title: President & CEO                	 

 

 

 

 

 

 

 

    
	 	8Exhibit

Exhibit 10.1

RESTRICTED STOCK UNIT AGREEMENT

This RESTRICTED STOCK UNIT AGREEMENT (this “Agreement”), dated as of June 20, 2019 (the “Date of Grant”), is entered into by and between GUESS?, INC., a Delaware corporation (the “Company”), and Paul Marciano (the “Grantee”).

RECITALS

WHEREAS, the Company maintains the Guess?, Inc. 2004 Equity Incentive Plan (as Amended and Restated as of May 19, 2017) (the “Plan”).

WHEREAS, the Compensation Committee of the Company’s Board (the “Committee”) has determined to grant a restricted stock unit award (this “Award”) to the Grantee under the Plan in order to increase Grantee’s participation in the success of the Company;

NOW, THEREFORE, the parties hereto agree as follows:

		
	1.
	Definitions; Incorporation of Plan Terms.  Capitalized terms used herein without definition shall have the meanings assigned to them in the Plan.  This Award and all rights of the Grantee under this Agreement are subject to, and the Grantee agrees to be bound by, all of the terms and conditions of the Plan, incorporated herein by this reference.  Except as specifically provided in this Agreement, in the event of any conflict or inconsistency between the Plan and this Agreement, the Plan shall govern.

		
	2.
	Grant of Restricted Stock Units.  The Company hereby grants to the Grantee as of the Date of Grant (set forth above) a right to receive 205,339 shares of the Company’s common stock subject to the terms, conditions, and restrictions set forth herein (the “Restricted Stock Units”).  As used herein, the term “Restricted Stock Unit” shall mean a non-voting unit of measurement which is deemed for bookkeeping purposes to be equivalent to one outstanding share of the Company’s common stock, par value $0.01 per share (the “Common Stock”) solely for purposes of the Plan and this Agreement.  The Restricted Stock Units shall be used solely as a device for the determination of the number of shares of Common Stock to eventually be delivered to the Grantee if such Restricted Stock Units vest pursuant to this Agreement.  The Restricted Stock Units shall not be treated as property or as a trust fund of any kind.  The Grantee shall have no rights as a shareholder of the Company, no dividend rights (except as expressly provided in Section 4 with respect to Dividend Equivalent Rights) and no voting rights with respect to the Restricted Stock Units and any shares of Common Stock underlying or issuable in respect of such Restricted Stock Units (“Award Shares”) until such shares of Common Stock are actually issued to and held of record by the Grantee.  This Award is in complete satisfaction of the Grantee’s right, if any, to receive equity-based awards from the Company with respect to the Company’s 2020 fiscal year.  

		
	3.
	Vesting.  

		
	A.
	If both the Licensing Segment Earnings from Operations Threshold and the Earnings from Operations Threshold (each as determined pursuant to Section 3(B)) are achieved for the Performance Period then, except as otherwise expressly provided in Sections 7 and 8 herein, this Award shall vest as to (i) one-third of the Restricted Stock Units on January 30, 2020 (the “First Tranche”), (ii) one-third of the Restricted Stock Units on January 30, 2021 (the “Second Tranche”), and (iii) one-third of the Restricted Stock Units on January 30, 2022 (the “Third Tranche”); provided that Grantee has been continuously in Service with the Company from the Date of Grant through each applicable vesting date.  If either (but not both) the Licensing Segment Earnings from Operations Threshold or the Earnings from Operations Threshold (each as determined pursuant to Section 3(B)) is achieved for the Performance Period then, except as otherwise 

 1

expressly provided in Sections 7 and 8 herein, this Award shall vest as to (i) one-sixth of the Restricted Stock Units on January 30, 2020 (the “First Tranche”), (ii) one-sixth of the Restricted Stock Units on January 30, 2021 (the “Second Tranche”), and (iii) one-sixth of the Restricted Stock Units on January 30, 2022 (the “Third Tranche”); provided that Grantee has been continuously in Service with the Company from the Date of Grant through each applicable vesting date.  Except as specifically provided herein, employment or service for only a portion of the vesting period, even if a substantial portion, will not entitle the Grantee to any proportionate vesting.  As used herein, the term “Service” means employment by the Company or service to the Company as a member of the Board.
		
	B. 
	No portion of this Award shall vest notwithstanding satisfaction of the continued Service requirement for vesting described in Section 3(A) above unless the Committee certifies, following the end of the Company’s 2020 fiscal year, that the Company achieved (i) Licensing Segment Earnings from Operations (as defined below) for the Company’s 2020 fiscal year (the “Performance Period”) equal to or above the level established by the Committee with respect to the Award in connection with the grant of the Award (the “Licensing Segment Earnings from Operations Threshold”) or (ii) Earnings from Operations (as defined below) for the Performance Period equal to or above the level established by the Committee with respect to the Award in connection with the grant of the Award (the “Earnings from Operations Threshold”); provided, however, that if either a Change in Control or the death or Disability (as defined below) of the Grantee occurs before the last day of the Performance Period, the performance requirement of this Section 3(B) shall be deemed met as of the date of such event.  If both the Licensing Segment Earnings from Operations Threshold and the Earnings from Operations Threshold are not met for the Performance Period (and no such Change in Control, death or Disability occurs before the last day of the Performance Period), this Award and the Restricted Stock Units subject hereto shall terminate and be cancelled as of the last day of the Performance Period.  If either (but not both) the Licensing Segment Earnings from Operations Threshold or the Earnings from Operations Threshold is not met for the Performance Period (and no such Change in Control, death or Disability occurs before the last day of the Performance Period), fifty percent (50%) of the total number of Restricted Stock Units subject to this Award (rounded to the nearest whole number) shall terminate and be cancelled as of the last day of the Performance Period.

		
	C.
	For purposes of this Award, “Disabled” and “Disability” shall (i) have the meaning defined under the Company’s then-current long-term disability insurance plan, policy, program or contract as entitles the Grantee to payment of disability benefits thereunder, or (ii) if there shall be no such plan, policy, program or contract, mean permanent and total disability as defined in Section 22(e)(3) of the Code.  

For purposes of this Award, “Licensing Segment Earnings from Operations” means: the Company’s earnings from operations derived from the Company’s Licensing Segment for the Performance Period as calculated in accordance with generally accepted accounting principles (“GAAP”), but adjusted (without duplication and to the extent that the particular item would have otherwise impacted Licensing Segment Earnings from Operations for such period) to exclude the financial statement impact of the following items: (a) any positive or negative charges or accruals incurred for the Performance Period for litigation matters, but only where such charges or accruals for any particular matter exceed $500,000 for the Performance Period, (b) any professional service and legal fees and related costs excluded from the Company’s adjusted results for the Performance Period, as reflected in the Company’s press release financials for such period, (c) restructuring charges incurred for the Performance Period, including employee severance related costs, store closure related costs and other real estate exit related costs, (d) any store impairment charges, (e) changes in accounting standards or methods that are implemented during the Performance Period in accordance with GAAP (to the extent not taken into account by the Committee when it established the goals), (f) acquisitions, costs associated with such acquisitions, and the costs 

 2

incurred in connection with potential acquisitions that are required to be expensed under GAAP, in each case for the Performance Period, (g) gains or losses on dispositions of investments accounted for under the equity method of accounting in accordance with GAAP and costs associated with such transactions, in each case for the Performance Period, and (h) corresponding income tax expenses and/or benefits for the Performance Period associated with items (a) through (g) herein.
For purposes of this Award, “Earnings from Operations” means: total Company earnings from operations for the Performance Period as calculated in accordance with GAAP, but adjusted (without duplication and to the extent that the particular item would have otherwise impacted Earnings from Operations for such period) to exclude the financial statement impact of the following items: (a) any positive or negative charges or accruals incurred for the Performance Period for litigation matters, but only where such charges or accruals for any particular matter exceed $500,000 for the Performance Period, (b) any professional service and legal fees and related costs excluded from the Company’s adjusted results for the Performance Period, as reflected in the Company’s press release financials for such period, (c) restructuring charges incurred for the Performance Period, including employee severance related costs, store closure related costs and other real estate exit related costs, (d) any store impairment charges, (e) changes in accounting standards or methods that are implemented during the Performance Period in accordance with GAAP (to the extent not taken into account by the Committee when it established the goals), (f) acquisitions, costs associated with such acquisitions, and the costs incurred in connection with potential acquisitions that are required to be expensed under GAAP, in each case for the Performance Period, (g) gains or losses on dispositions of investments accounted for under the equity method of accounting in accordance with GAAP and costs associated with such transactions, in each case for the Performance Period, and (h) corresponding income tax expenses and/or benefits for the Performance Period associated with items (a) through (g) herein.
		
	4.
	Dividend Equivalents.  If a cash dividend is paid with respect to the Common Stock while any Restricted Stock Units subject to the Award are outstanding, the Grantee shall be credited with an amount in cash equal to the dividends the Grantee would have received if he had been the owner of the shares of Common Stock subject to such outstanding Restricted Stock Units; provided, however, that no amount shall be credited with respect to shares that have been delivered to the Grantee as of the applicable dividend record date.  Any amounts credited under this Section 4 (“Dividend Equivalents”) shall be subject to the same terms and conditions as the Restricted Stock Units to which they relate and shall vest and be paid (or, if applicable, be forfeited) at the same time as the Restricted Stock Units to which they relate.  

		
	5.
	Delivery of Shares.  Except as otherwise provided in Section 8 below with respect to a Change in Control, the Company shall deliver or cause to be delivered to the Grantee the number of Award Shares subject to the First Tranche that vest pursuant to the terms hereof within ten days following certification by the Committee of the satisfaction of the performance criteria set forth in Section 3(B) (and in no event later than 74 days following the end of the Performance Period), the number of Award Shares subject to the Second Tranche that vest pursuant to the terms hereof on (or within three business days following) January 30, 2020 and the number of Award Shares subject to the Third Tranche that vest pursuant to the terms hereof on (or within three business days following) January 30, 2021.  Any Dividend Equivalents described in Section 4 above related to such Award Shares shall be paid in cash at the same time as the delivery of the Award Shares under this Section 5.  Notwithstanding the foregoing, in the event of the Grantee’s death or Disability (as such term is defined for purposes of Section 409A of the Code), then such shares shall be settled as soon as administratively practicable after (and in all events within 90 days after) such event.

		
	6.
	Adjustments Upon Specified Events.  Upon the occurrence of certain events relating to the Company’s Common Stock contemplated by Section 16(b) of the Plan, the Committee will make adjustments, if appropriate, in the number of Restricted Stock Units and the number and kind of securities subject to the Award. 

 3

		
	7.
	Effect of Certain Cessations of Service.  The continued Service vesting requirement set forth under Section 3(A) of this Award shall be deemed to be satisfied, and any then-outstanding Restricted Stock Units shall be deemed vested, in the event of the Grantee’s Disability or death while in Service.  For purposes of clarity, any Restricted Stock Units that vest pursuant to the preceding sentence shall still be paid at the applicable time set forth in Section 5.  If the Grantee’s Service terminates for any other reason, this Award and the Restricted Stock Units subject hereto, to the extent outstanding and unvested as of the date of such termination of Service, shall terminate and be cancelled as of the date of such termination of Service.  Sections 14(a) and 14(b) of the Plan shall not apply to the Award.

		
	8.
	Change in Control.  Notwithstanding anything to the contrary in Section 3, Section 5 or Section 7 of this Agreement or any provision of the Plan, the following provisions shall apply upon a Change in Control:

		
	A.
	If a Change in Control occurs and the then-outstanding and unvested portion of this Award is not continued following such event or assumed or converted into restricted stock units of any successor entity to the Company or a parent thereof (the “Successor Entity”), the continued Service vesting requirement set forth under Section 3(A) of this Award shall be deemed to be satisfied, the outstanding Restricted Stock Units subject to such portion shall be deemed vested, and such Restricted Stock Units shall be settled at the time(s) otherwise provided in Section 5; provided that if such Change in Control constitutes a “change in the ownership or effective control” of the Company, or a change “in the ownership of a substantial portion of the assets” of the Company within the meaning of Section 409A of the Code (a “Section 409A Change in Control”), outstanding and vested Restricted Stock Units (including any that vest pursuant to the foregoing provisions of this sentence) and related Dividend Equivalents shall be settled upon or as soon as practicable after the date of such Change in Control to the extent such acceleration of payment can be made in accordance with Treas. Reg. §1.409A-3(j)(4)(ix) (or other exemption from the general prohibitions on accelerations of payments under Section 409A of the Code) and not result in any tax, penalty or interest under Section 409A of the Code.  In connection with any such Change in Control where payment of outstanding Restricted Stock Units subject to the Award will not be made in connection with the Change in Control, the Committee may make provision for such Restricted Stock Units to become payable in cash based on the Fair Market Value of a share of Common Stock at the time of such Change in Control (with interest for the period from the date of such Change in Control to the applicable payment date at such rate as determined by the Committee based on the interest earned by interest bearing, FDIC insured deposits) as opposed to being payable in securities.

		
	B.
	If the then-outstanding and unvested portion of this Award is continued following such event or is assumed or converted into restricted stock units of any Successor Entity, the continued Service requirement set forth in Section 3(A) above (and the accelerated vesting provisions set forth in Section 7 above) shall continue to apply following such Change in Control, and any portion of the Award that vests pursuant to such provisions shall be settled as provided in Section 5 of this Agreement.

Section 17 of the Plan shall not apply with respect to the Award.
		
	9.
	Restrictions on Transfer.  The Grantee may not sell, assign, transfer, pledge, encumber or otherwise alienate, hypothecate or dispose of this Award or the Grantee’s right hereunder to receive Award Shares, except as otherwise provided in the Committee’s sole discretion consistent with the Plan and applicable securities laws.   

		
	10.
	Taxes.

		
	A.
	The settlement of this Award is conditioned on the Grantee making arrangements reasonably satisfactory to the Company for the withholding of all applicable federal, state, local or foreign taxes as may be required under applicable law.

		
	B.
	It is intended that any amounts payable under this Agreement shall either be exempt from or comply with Section 409A of the Code (including the Treasury regulations and other published 

 4

guidance relating thereto) (“Code Section 409A”) so as not to subject the Grantee to payment of any additional tax, penalty or interest imposed under Code Section 409A.  The provisions of this Agreement shall be construed and interpreted to avoid the imputation of any such additional tax, penalty or interest under Code Section 409A yet preserve (to the nearest extent reasonably possible) the intended benefit payable to the Grantee.
		
	C.
	If the Grantee is a “specified employee” within the meaning of Treasury Regulation Section 1.409A-1(i) as of the date of the Grantee’s “separation from service” (as such term is defined for purposes of Code Section 409A), the Grantee shall not be entitled to any payment or benefit pursuant to this Award until the earlier of (i) the date which is six (6) months after the Grantee’s separation from service for any reason other than death, or (ii) the date of the Grantee’s death.  The provisions of this Section 10(C) shall only apply if, and to the extent, required to avoid the imputation of any tax, penalty or interest pursuant to Code Section 409A.  Any amounts otherwise payable to the Grantee upon or in the six (6) month period following the Grantee’s separation from service that are not so paid by reason of this Section 10(C) shall be paid (without interest, except as otherwise provided for in Section 8(A)) as soon as practicable (and in all events within thirty (30) days) after the date that is six (6) months after the Grantee’s separation from service (or, if earlier, as soon as practicable, and in all events within thirty (30) days, after the date of the Grantee’s death).  For avoidance of doubt, Dividend Equivalents under Section 4 shall continue to be credited during the period of such six-month delay until the vested Restricted Stock Units are actually settled.

		
	11.
	Compliance.  The Grantee hereby agrees to cooperate with the Company, regardless of Grantee’s employment status with the Company, to the extent necessary for the Company to comply with applicable state and federal laws and regulations relating to the Restricted Stock Units.

		
	12.
	Notices.  Any notice required or permitted under this Agreement shall be deemed given when personally delivered, or when deposited in a United States Post Office, postage prepaid, addressed, as appropriate, to the Grantee either at the address on record with the Company or such other address as may be designated by Grantee in writing to the Company; or to the Company, Attention: Stock Plan Administration, 1444 South Alameda Street, Los Angeles, California  90021, or such other address as the Company may designate in writing to the Grantee.

		
	13.
	Failure to Enforce Not a Waiver.  The failure of the Company or the Grantee to enforce at any time any provision of this Agreement shall in no way be construed to be a waiver of such provision or of any other provision hereof.

		
	14.
	Governing Law.  This Agreement shall be governed by and construed according to the laws of the State of Delaware, without regard to Delaware or other laws that might cause other law to govern under applicable principles of conflicts of law.  For purposes of litigating any dispute that arises under this Agreement, the parties hereby submit to and consent to the jurisdiction of the State of California, and agree that such litigation shall be conducted in the courts of Los Angeles County, or the federal courts for the United States for the Central District of California, and no other courts, where this Agreement is made and/or to be performed.

		
	15.
	Electronic Delivery.  The Company may, in its sole discretion, decide to deliver any documents related to the Restricted Stock Units awarded under the Plan or future restricted stock or restricted stock units that may be awarded under the Plan by electronic means or request Grantee’s consent to participate in the Plan by electronic means.  Grantee hereby consents to receive such documents by electronic delivery and agrees to participate in the Plan through an on-line or electronic system established and maintained by the Company or another third party designated by the Company.

		
	16.
	Severability.  The provisions of this Agreement are severable and if any one or more provisions are determined to be illegal or otherwise unenforceable, in whole or in part, the remaining provisions shall nevertheless be binding and enforceable.

		
	17.
	Amendments.  This Agreement may be amended or modified at any time by an instrument in writing signed by both parties.

 5

		
	18.
	Agreement Not a Contract of Employment.  Neither the grant of the Restricted Stock Units, this Agreement nor any other action taken in connection herewith shall constitute or be evidence of any agreement or understanding, express or implied, that the Grantee is an employee of the Company or any subsidiary of the Company.

		
	19.
	Committee’s Powers.  No provision contained in this Agreement shall in any way terminate, modify or alter, or be construed or interpreted as terminating, modifying or altering any of the powers, rights or authority vested in the Committee or, to the extent delegated, in its delegate pursuant to the terms of the Plan or resolutions adopted in furtherance of the Plan, including, without limitation, the right to make certain determinations and elections with respect to the Restricted Stock Units.

		
	20.
	Termination of this Agreement.  Upon termination of this Agreement, all rights of the Grantee hereunder shall cease.

		
	21.
	Clawback Policy.  This Award is subject to the terms of the Company’s recoupment, clawback or similar policy as it may be in effect from time to time, as well as any similar provisions of applicable law, any of which could in certain circumstances require repayment or forfeiture of the Award or any shares of Common Stock or other cash or property received with respect to the Award (including any value received from a disposition of the shares acquired in respect of the Award).

IN WITNESS WHEREOF, the Company has caused this Agreement to be executed on its behalf by a duly authorized officer and the Grantee has hereunto set his or her hand as of the date and year first above written.
GUESS?, INC.,
a Delaware corporation

By: /s/ Jason T. Miller            
Print Name:  Jason T. Miller
Its:  General Counsel and Secretary
GRANTEE
/s/ Paul Marciano            
Signature

Paul Marciano                    
Print Name
 

 6

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