Document:

Exhibit

Exhibit 10.7

PERFORMANCE SHARE AWARD AGREEMENT
(Revenue (Excluding Americas Retail)/Earnings from Operations)

This PERFORMANCE SHARE AWARD AGREEMENT (this “Agreement”), dated as of [April 28, 2017] (the “Date of Grant”), is entered into by and between GUESS?, INC., a Delaware corporation (the “Company”), and [____________] (the “Grantee”).

RECITALS

WHEREAS, the Company maintains the Guess?, Inc. 2004 Equity Incentive Plan (as Amended and Restated as of May 20, 2014) (the “Plan”).

WHEREAS, the Compensation Committee of the Company’s Board of Directors (the “Committee”) has determined to grant performance-based restricted stock units (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 a “target” of [________] shares of the Company’s common stock subject to the terms, conditions, and restrictions set forth herein (the “Restricted Stock Units,” and such target number of Restricted Stock Units, the “Target Number of 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 stockholder 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, together with the other equity awards granted by the Company to the Grantee on or about the date hereof, is in complete satisfaction of the Grantee’s 

right to receive stock options or other equity-based awards from the Company with respect to the Company’s 2018 fiscal year.
		
	3.
	Vesting.  Except as otherwise expressly provided in Sections 7 and 8 herein, this Award shall vest and become nonforfeitable on the last day of the Performance Period (as defined in Exhibit A hereto) (the “Vesting Date”); provided that the Grantee has been continuously in Service with the Company from the Date of Grant through the Vesting Date.  Except as specifically provided herein, Service for only a portion of the vesting period, even if a substantial portion, will not entitle the Grantee to any proportionate vesting.  The number of Restricted Stock Units subject to this Award that vest will be determined based on the Vesting Percentage (as such term is defined in Exhibit A hereto and as calculated in accordance with Exhibit A based on the Company’s performance during the Performance Period). 

Not later than seventy four (74) days after the end of the Performance Period, the Committee will certify, by resolution or other appropriate action in writing, the Vesting Percentage that has been achieved and the number of Restricted Stock Units that vest pursuant to this Section 3 (or Sections 7 and 8, as applicable) based on the satisfaction of the applicable performance criteria.  Such number of Restricted Stock Units that vest will be rounded to the nearest whole unit and are referred to herein as the “Vested Restricted Stock Units.”  Restricted Stock Units that are not Vested Restricted Stock Units, after giving effect to the foregoing provisions, as of the last day of the Performance Period shall immediately terminate and be cancelled.  As used herein, the term “Service” means employment by the Company or service to the Company as a member of the Board.
		
	4.
	Dividend Equivalents.  If a cash dividend is paid with respect to the Common Stock after the Date of Grant and before the end of the Performance Period and while any Restricted Stock Units subject to this 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 the outstanding Target Number of 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 (including, without limitation, application of the applicable Vesting Percentage) 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 any Restricted Stock Units that vest pursuant to the terms hereof as soon as administratively practicable after (and in no event later than 74 days following) the Vesting Date.  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:  (a) 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; and (b) in the event of the Grantee’s “separation from service” (as such term is defined for purposes of Code 

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Section 409A) upon or within two years following a Section 409A Change in Control (as such term is defined in Section 8(A)), then such shares shall be settled as soon as administratively possible after (and in all events within ten days after) such event (subject to Section 10(C)). 
		
	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 this Award.  

		
	7.
	Effect of Certain Cessations of Service.  

		
	A.
	If, at any time prior to the Vesting Date, the Grantee’s death or Disability (as such term is defined in the Plan) occurs while the Grantee is in Service with the Company and a Change in Control has not previously occurred, this Award will vest as of the date of such event with respect to the Target Number of Restricted Stock Units.   

		
	B.
	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 this Award.  

		
	C.
	For purposes of clarity, any Restricted Stock Units that vest pursuant to this Section 7 (and any Dividend Equivalents related thereto) shall still be paid at the applicable time set forth in Section 5.

		
	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 (as defined in the Plan):

		
	A.
	If a Change in Control occurs and this Award (to the extent outstanding) 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”), this Award will vest as of the date of such Change in Control with respect to the Target Number of Restricted Stock Units.

Any such Restricted Stock Units (and any related Dividend Equivalents) that become vested pursuant to this Section 8(A) shall be paid 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”), the outstanding vested Restricted Stock Units subject to this Award and any related Dividend Equivalents shall be paid 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 such 

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Restricted Stock Units subject to this 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.  The foregoing provisions do not supersede Section 7(B) to the extent the Grantee’s Service to the Company terminates and such provision is triggered prior to a Change in Control.  
		
	B.
	If this Award (to the extent then outstanding) is continued following a Change in Control or is assumed or converted into restricted stock units of any Successor Entity, the performance-based vesting conditions of Section 3 shall no longer apply to this Award, and the Target Number of Restricted Stock Units subject to this Award shall remain eligible to vest on the original Vesting Date (without such date being modified due to the occurrence of the Change in Control), subject to the Grantee remaining continuously in Service with the Company following such Change in Control through the Vesting Date; provided, however, that if a termination of the Grantee’s Service described in Section 7(A) above occurs after such Change in Control and prior to the Vesting Date, this Award will vest as of the date of such termination of the Grantee’s Service with respect to the Target Number of Restricted Stock Units.  Any Restricted Stock Units (and any related Dividend Equivalents) that vest pursuant to this Section 8(B) shall be paid at the time(s) otherwise provided in Section 5. 

Section 17 of the Plan shall not apply with respect to this 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 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 

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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) 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).
		
	D.
	It is intended that this Award qualify as “performance-based compensation” for purposes of Section 162(m) of the Code and the provisions of this Agreement shall be construed and interpreted consistent with that intent.

		
	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 

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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.

		
	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 this Award or any shares of Common Stock or other cash or property received with respect to this Award (including any value received from a disposition of the shares acquired in respect of this Award).

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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:
	 

	 
	 
	Print Name:
	Jason T. Miller

	 
	 
	Its:
	Secretary

	 
	 
	 
	 
	 

	 
	 
	GRANTEE

	 
	 
	 

	 
	 
	Signature

	 
	 
	 

	 
	 
	Print Name

	 
	 
	 

	 
	 
	Employee ID

	 
	 
	 
	 
	 

	 
	 
	 
	 
	 

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MARITAL STATUS
 	
					
	o
	I AM NOT MARRIED.

	 

	o
	I AM MARRIED AND HAVE INFORMED MY SPOUSE OF THIS EQUITY GRANT. (Please have your spouse sign the Consent of Spouse section below.)

	 

	 
	 
	 
	 

	
					
	 
	 
	GRANTEE

	 
	 
	 

	 
	 
	Signature

	 
	 
	 

	 
	 
	Print Name

	 
	 
	 
	 
	 

	 
	 
	 
	 
	 

CONSENT OF SPOUSE
In consideration of the execution of the foregoing Performance Restricted Stock Unit Agreement by Guess?, Inc., a Delaware corporation, I, _____________________________, the spouse of the Grantee therein named, do hereby join with my spouse in executing the foregoing Performance Restricted Stock Unit Agreement and do hereby agree to be bound by all of the terms and provisions thereof and of the Plan.

Dated:    ___________________    
	
					
	 
	 
	 

	 
	 
	Signature of Spouse

	 
	 
	 

	 
	 
	Print Name

	 
	 
	 
	 
	 

	 
	 
	 
	 
	 

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EXHIBIT A

PERFORMANCE-BASED VESTING

This Exhibit A is subject to the other provisions of this Agreement (including, without limitation, Sections 3, 7 and 8 of this Agreement).
 The Award shall be eligible to vest as to a number of Restricted Stock Units equal to (a) the Target Number of Restricted Stock Units, multiplied by (b) the vesting percentage determined in accordance with this Exhibit A (the “Vesting Percentage”) based on the Company’s Revenue and Earnings from Operations levels versus the threshold, target and stretch levels established by the Committee with respect to the Award in connection with the grant of the Award for the Company’s fiscal year 2020 (the “Performance Period”).  For purposes of the Award, the Revenue metric shall be weighted twenty-five percent (25%), and the Earnings from Operations metric shall be weighted seventy-five percent (75%) (the “Weighting Percentage”).  The Vesting Percentage for each of the Revenue and Earnings from Operations metrics will be determined as follows: 
	
					
	Company Revenue for
the Performance Period
(in millions)
	 
	Company Earnings from
Operations for the
Performance Period
(in millions)
	 
	Vesting
Percentage

	Below Threshold
	 
	Below Threshold
	 
	0%

	Threshold
	 
	Threshold
	 
	50%

	Target
	 
	Target
	 
	100%

	Stretch and Above
	 
	Stretch and Above
	 
	200%

If the Company’s actual performance (subject to the adjustments described below), as to a particular Performance Metric, is between two levels specified by the Committee, the Vesting Percentage for such metric shall be determined by linear interpolation between the Vesting Percentages specified for those two levels.  For each Performance Metric, a “Weighted Vesting Percentage” shall be calculated by multiplying such metric’s Vesting Percentage by such metric’s Weighting Percentage.  The Vesting Percentage for the Award shall equal the sum of the two Weighted Vesting Percentages.  In no event shall the total Vesting Percentage for the Award exceed two hundred percent (200%).
Defined Terms.  For purposes of the Award, the following definitions will apply.  In each case, the financial results of the Company referred to in the definitions below shall be determined on a consolidated basis. 
		
	•
	“GAAP” means U.S. generally accepted accounting principles.

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	•
	“Earnings from Operations” means the Company’s worldwide earnings from operations for the Performance Period, as determined by the Company in accordance with GAAP and reflected in its reporting of financial results.

		
	•
	“Performance Metric” means Revenue or Earnings from Operations, as applicable.

		
	•
	“Revenue” means the Company’s worldwide revenue (excluding revenue for the Company’s Americas Retail Segment) for the Performance Period, as determined by the Company in accordance with GAAP and reflected in its reporting of financial results.

Adjustments.  For purposes of determining Revenue and Earnings from Operations under the Award for the Performance Period, the Committee shall adjust (without duplication) the performance results for the applicable Performance Metric (as determined before giving effect to such adjustments), for the following items:
		
	(a)
	increased or decreased to eliminate the financial statement impact of any charges or accruals during 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) 
	increased or decreased to eliminate the financial statement impact of restructuring charges incurred during the Performance Period, including employee severance related costs, store closure related costs and other real estate closure related costs;

		
	(c) 
	increased or decreased to eliminate the financial statement impact of any store impairment charges;

		
	(d)
	increased or decreased to eliminate the financial statement impact of (i) any new changes in accounting standards announced between the first day of the Company’s fiscal year 2018 and the end of the Performance Period and (ii) the new comprehensive standards for revenue recognition (Topic 606: Revenue from Contracts with Customers) and Leases (Topic: 842) first issued by the Financial Accounting Standards Board in 2014 and 2016, respectively, in each case including any additional clarifications or guidance issued with respect thereto; and in the case of each of (i) and (ii) that are required or permitted to be applied before the end of the Performance Period in accordance with GAAP;

		
	 (e) 
	increased or decreased to eliminate the financial statement impact of costs associated with acquisitions and costs incurred in connection with potential acquisitions that are required to be expensed under GAAP during the Performance Period;

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	(f) 
	increased or decreased to eliminate the financial statement impact of 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 during the Performance Period;

		
	(g)
	increased or decreased to eliminate the impact of currency fluctuations as and to the extent provided by the constant currency methodology approved by the Committee in connection with the grant of the Award; and 

		
	(h)
	increased or decreased to eliminate the financial statement impact of corresponding income tax expenses and/or benefits for the Performance Period associated with items (a) through (g) herein.

The Committee’s determination of whether an adjustment is required, and the nature and extent of any such adjustment, shall be final and binding.

11EX-4.1

 Exhibit 4.1 

THIS CONVERTIBLE PROMISSORY NOTE AND THE SECURITIES TO BE DELIVERED HEREUNDER AND UPON CONVERSION HEREOF HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE SECURITIES LAW OF ANY STATE OR OTHER JURISDICTION. NO SALE, ASSIGNMENT, TRANSFER FOR VALUE, PLEDGE OR OTHER ENCUMBERANCE OF EITHER THIS CONVERTIBLE PROMISSORY NOTE OR ANY SUCH
SECURITIES MAY BE MADE UNLESS (1) SUCH TRANSACTION IS MADE PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT FILED UNDER THE ACT AND THE APPLICABLE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION OR (2) THE MAKER IS PROVIDED WITH AN
OPIINION OF COUNSEL, SATISFACTORY TO THE MAKER, STATING THAT SUCH TRANSACTION IS IN COMPLIANCE WITH EXEMPTIONS FROM REGISTRATION UNDER SUCH ACT AND SUCH OTHER APPLICABLE LAWS. NO TRANSFER OF ANY INTEREST IN THIS CONVERTIBLE PROMISSORY NOTE OR ANY
SUCH SECURITIES MAY BE EFFECTED WITHOUT FIRST SURRENDERING THIS CONVERTIBLE PROMISSORY NOTE OR SUCH SECURITIES, AS THE CASE MAY BE, TO THE COMPANY OR ITS TRANSFER AGENT, IF ANY. 

CONVERTIBLE PROMISSORY NOTE 
  

			
	Amount $        	  	             , 2017

 FOR VALUE RECEIVED, CYTODYN INC., a Delaware corporation (“Maker”), hereby promises to pay
to                     (“Holder”) the principal amount of
                    and 00/100 Dollars ($        .00), together with interest thereon at a fixed simple
interest rate of seven percent (7%) per annum. 
 Principal and accrued interest on this Promissory Note, to the extent not previously paid
in cash or converted as described below, shall be due and payable in cash in a single payment on January 31, 2018 (the “Due Date”). Interest shall be paid in cash in arrears upon the Due Date. 

In connection with this Promissory Note, Holder will be issued, at no additional cost to Holder, a warrant (the “Note Warrant”) to
purchase                 shares of the Maker’s common stock (the “Shares”) at an exercise price of $1.35 per Share (the “Exercise Price”), in
substantially the form attached hereto as Exhibit A. The Note Warrant will be exercisable at the option of the Holder at any time after              , 2017 (the “Effective
Date”), but not later than five (5) years after the Effective Date. 
 All or any portion of principal and any related accrued
but unpaid interest hereunder may be converted (each, a “Conversion”) by Holder at any time prior to the Due Date into a number of Shares determined by dividing the converted principal amount and related accrued but unpaid interest by the
conversion price of $0.75 per Share (the “Conversion Price”), with the resulting number of Shares to be issued, rounded down to the nearest whole Share, being referred to as the “Conversion Share Number.” No Conversion hereunder
shall be effective unless written notice of the Conversion is given by Holder at least five (5) days prior to such Conversion, in substantially the form attached hereto as Exhibit B. 

If the Maker is recapitalized through the subdivision or combination of its outstanding shares of common stock into a larger or smaller number
of shares, the Conversion Price shall be adjusted as of the record date for such recapitalization so that the Conversion Share Number shall be increased or reduced in the same proportion as the increase or decrease in the outstanding shares of
common stock in such recapitalization. 

 The Maker shall not issue any fractional Shares upon Conversion by Holder of any principal and
related accrued but unpaid interest hereunder or upon the exercise of the Warrants. With respect to any fraction of a Share resulting from such Conversion or exercise, the Maker shall issue to Holder a number of Shares rounded down to the nearest
whole Share. 
 Default in the payment of the principal of or interest on this Promissory Note when the same becomes due and payable shall
constitute an event of default hereunder. Upon the occurrence of an event of default, or at any time thereafter during the continuance of any such event, the Holder may, with or without notice to the Maker, declare this Promissory Note to be
forthwith due and payable, whereupon this Promissory Note and the indebtedness evidenced hereby shall forthwith be due and payable, both as to principal and interest, without presentment, demand, protest, or other notice of any kind, all of which
are hereby expressly waived, anything contained herein or in any other instrument executed in connection with or securing this Note to the contrary notwithstanding. If the Due Date of this Promissory Note is accelerated as provided above, the Holder
may convert the principal portion of this Promissory Note into Shares at any time prior to the payment of such principal amount. 
 If the
Maker sells all or substantially all of its assets to a third party, merges, or consolidates with another entity, or engages in any other transaction with a third party requiring approval of the shareholders of the Maker, Maker shall give prompt
notice to the Holder, and Holder may immediately convert the principal amount of this Promissory Note into Shares at any time prior to the consummation of such transaction. 

If this Promissory Note or any interest hereon becomes due and payable on Saturday, Sunday or other day on which commercial banks are
authorized or permitted to close under the laws of the State of New York, the maturity of this Promissory Note or such installment shall be extended to the next succeeding business day. 

Maker may elect to prepay without penalty, on or before the Due Date, the aggregate outstanding principal balance of this Promissory Note, all
or any portion of the outstanding principal balance under this Promissory Note, together with accrued but unpaid interest, by wire transfer or other cash equivalent acceptable to Maker; provided, however, for any such prepayment, Maker must first
give Holder at least ten (10) days prior notice of such prepayment and, during such time, Holder may elect in writing to effect a Conversion of all or a portion of such principal balance, together with any accrued but unpaid interest so desired
to be prepaid by Maker, into Shares as provided herein. 
 This Promissory Note and the Securities to be issued in connection herewith and
upon Conversion hereof may not be offered, sold or otherwise disposed of except under circumstances which will not result in a violation of the Securities Act of 1933, as amended (the “Securities Act”). Upon Conversion of this Promissory
Note, the Holder hereof will be required to confirm in writing, by executing the form attached as Schedule 1 to Exhibit B hereto, that the Shares so purchased are being acquired for investment and not with a view toward distribution or
resale. This Promissory 

  
 2 

 
Note and all Shares issued upon Conversion hereof or upon the exercise of the Warrants (unless registered under the Securities Act) shall be stamped or imprinted with a legend in substantially
the following form: 
 “THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR THE
SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION. THE SHARES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE SOLD, TRANSFERRED FOR VALUE, PLEDGED, HYPOTHECATED, OR OTHERWISE ENCUMBERED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION OF THEM UNDER THE
SECURITIES ACT OF 1933 AND THE APPLICABLE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION, OR AN APPLICABLE EXEMPTON FROM REGISTRATION UNDER SUCH ACT AND SECURITIES LAWS.” 

With respect to any offer, sale or other disposition of this Promissory Note or any Securities to be issued in connection herewith or upon
Conversion hereof prior to registration of such Promissory Note or Securities, the Holder hereof and each subsequent Holder of this Promissory Note will be required to give written notice to the Maker prior thereto, describing briefly the manner
thereof, together with a written opinion of such Holder’s counsel reasonably acceptable to the Maker’s counsel, if such opinion is reasonably requested by the Maker, to the effect that such offer, sale or other disposition may be effected
without registration or qualification (under the Securities Act as then in effect and the applicable securities laws of any state or other jurisdiction as then in effect) of this Promissory Note or such Securities and indicating whether or not under
the Securities Act and the applicable securities laws of any state or other jurisdiction this Promissory Note or certificates for such Securities to be sold or otherwise disposed of require any restrictive legend as to applicable restrictions on
transferability in order to ensure compliance with applicable law. Promptly upon receiving such written notice and reasonably satisfactory opinion, if so requested, the Maker, as promptly as practicable, shall notify such Holder that such Holder may
sell or otherwise dispose of this Promissory Note or such Securities, all in accordance with the terms of the notice delivered to the Maker. If a determination has been made pursuant to this paragraph that the opinion of counsel for the Holder is
not reasonably satisfactory to the Maker, the Maker shall so notify the Holder promptly after such determination has been made and neither this Promissory Note nor any Securities shall be sold or otherwise disposed of until such disagreement has
been resolved. The foregoing notwithstanding, this Promissory Note or such Securities may as to such federal laws, be offered, sold or otherwise disposed of in accordance with Rule 144 under the Securities Act, provided that the Maker shall have
been furnished with such information as the Maker may reasonably request to provide a reasonable assurance that the provisions of Rule 144 have been satisfied. This Promissory Note and each certificate representing the Securities thus transferred
(except a transfer pursuant to Rule 144) shall bear a legend as to the applicable restrictions on transferability in order to ensure compliance with such laws, unless in the aforesaid opinion of counsel for the Holder, reasonably acceptable to the
Maker, such legend is not required in order to ensure compliance with such laws. The Maker may issue stop transfer instructions to its transfer agent or, if acting as its own transfer agent, the Maker may stop transfer on its corporate books, in
connection with such restrictions. 
 Any provision of this Promissory Note that is prohibited or unenforceable in any jurisdiction shall,
as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof or affecting the validity or enforceability of such provision in any other jurisdiction. 

  
 3 

 This Promissory Note is not transferable or assignable by the Maker without the consent of the
Holder. This Promissory Note is not transferable or assignable by the Holder without the consent of the Maker. If this Promissory Note is collected by law or through an attorney at law, or under advice therefrom, the Maker agrees to pay all costs of
collection, including reasonable attorneys’ fees. Reasonable attorneys’ fees are defined to include, but not be limited to, all fees incurred in all matters of collection and enforcement, trial proceedings and appeals, as well as
appearances in and connected with any bankruptcy proceedings or creditors’ reorganization or similar proceedings and any post judgment collection efforts. 

Any failure to exercise any right, remedy or recourse hereunder shall not be deemed to be a waiver or release of the same, such waiver or
release to be effected only through a written document executed by the Holder and then only to the extent specifically recited therein. A waiver or release with reference to any one event shall not be construed as continuing, as a bar to, or as a
waiver or release of any subsequent right, remedy or recourse as to a subsequent event. 
 In no event shall the amount of interest due or
payments in the nature of interest payable hereunder exceed the maximum rate of interest allowed by applicable law, as amended from time to time, and in the event any such payment is paid by the Maker or received by the Holder, then such excess sum
shall be credited as a payment of principal, unless the Maker shall notify the Holder, in writing, that the Maker elects to have such excess sum returned to the Maker forthwith. 

The Maker hereby waives all and every exemption secured to it by the laws and constitution of the State of New York, and of any other state.
The Maker hereby waives demand, presentment, protest, notice of nonpayment or dishonor, and any other notice required by law and agrees that its obligation hereunder shall not be affected by any renewal or extension of the time of payment hereof, or
by any indulgences. 
 This Promissory Note shall be governed by and construed in accordance with the laws of the State of New York
applicable to debts and obligations incurred and to be paid solely in such jurisdiction. This Promissory Note may not be modified or amended and no provision hereof may be waived except by a written instrument executed by the parties to be bound
thereby. 
  

			
	CYTODYN INC.
		
	By:	 	  

		 	Name:
		 	Title:

  
 4 

 EXHIBIT “A” 

FORM OF WARRANT 

 EXHIBIT “B” 

NOTICE OF CONVERSION 

(please print) 
  

	To:	CYTODYN INC. 

 1. In accordance with that certain Convertible Promissory Note issued by CYTODYN
INC. to                      on             , 2017 (the “Promissory Note”), the
undersigned hereby elects to convert $         of the principal amount of the Promissory Note, together with any related accrued but unpaid interest, into Shares. 

2. Please issue a certificate or certificates representing the Shares in the name of the undersigned or in such other name or names as are
specified below: 
  

                       
                                      

(Name) 
  

                       
                                      

                       
                                      

(Address) 
 3. The undersigned
represents that the aforesaid Shares are being acquired for the account of the undersigned for investment and not with a view to, or for resale in connection with, the distribution thereof and that the undersigned has no present intention of
distributing or reselling such Shares. In support thereof, the undersigned has executed an Investment Representation Statement attached hereto as Schedule 1. 

4. All capitalized terms used but not defined herein shall have the meaning ascribed to such terms in the Promissory Note. 

 

	
	  

	(Signature)

  

                          
                                   

(Date) 

Contact telephone:
                                        

 Email:
                                         
                    

 SCHEDULE 1 

INVESTMENT REPRESENTATION STATEMENT 

			
	Purchaser:	  	                                      
                      
	Company	  	CYTODYN INC.
	Security:	  	Common Stock
	Amount:	  	
	Date:	  	

 In connection with the purchase of the above-listed securities (the “Shares”) pursuant to that
certain Convertible Promissory Note issued by CYTODYN INC. to                     on
            , 2015 (the “Promissory Note”), the undersigned (the “Purchaser”) represents to the Maker as follows: 

 

	 	(a)	The Purchaser is aware of the Maker’s business affairs and financial condition, and has acquired information about the Maker sufficient to reach an informed and knowledgeable decision to acquire the Shares. The
Purchaser is acquiring the Shares for his own account for investment purposes only and not with a view to, or for the resale in connection with, any “distribution” thereof for purposes of the Securities Act. The Purchaser is an
“accredited investor” as that term is defined in Rule 501(a) of Regulation D promulgated under the Securities Act. 

  

	 	(b)	The Purchaser further agrees that legends may be placed on the Shares restricting the transfer thereof, and that appropriate notations may be made in the Maker’s stock books and stop transfer instructions placed
with the transfer agent, each in a manner generally consistent with the foregoing. 

  

	 	(c)	The Purchaser is aware of the provisions of Rule 144 promulgated under the Securities Act (“Rule 144”) which, in substance, permit limited public resale of “restricted securities” acquired by non-affiliates of the issuer thereof, directly or indirectly, from the issuer (or from an affiliate of such issuer), in a non-public offering subject to the satisfaction of
certain conditions, if applicable, including, among other things, the availability of certain public information about the Maker and the resale occurring not less than six (6) months after the party has purchased and paid for the securities to
be sold. 

  

	 	(d)	The Purchaser further understands that, at the time the Purchaser wishes to sell the Shares, there may be no public market upon which to make such a sale, and that, even if such a public market then exists, the Maker
may not have filed all reports and other materials required under Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, other than Form 8-K reports, during the preceding 12 months, and
that, in such event, because the Maker is a former “shell company” as contemplated under paragraph (i) of Rule 144, Rule 144 will not be available to the Purchaser. 

 

	 	(e)	The Purchaser further understands that, because the Maker is a former “shell company” as contemplated under paragraph (i) of Rule 144, regardless of the amount of time that the Purchaser holds the Shares,
sales of the Shares may only be made under Rule 144 upon the 

  
 1 

	 	satisfaction of certain conditions, including that the Maker has filed with the United States Securities and Exchange Commission (the “SEC”), during the 12 months preceding the sale, all quarterly and annual
reports required under the Securities Exchange Act of 1934, as amended; and that, accordingly, any restrictive legends placed on the Securities cannot be removed except in connection with an actual sale that is subject to an effective
registration statement under, or an applicable exemption from the registration requirements of, the Securities Act, and “blanket” removals of any such restrictive legends will not be possible. 

 

	 	(f)	The Purchaser further understands that in the event all of the requirements of Rule 144 are not satisfied, registration under the Securities Act, compliance with Regulation A promulgated under the Securities Act, or
some other registration exemption will be required; and that, notwithstanding the fact that Rule 144 is not exclusive, the staff of the SEC has expressed its opinion that persons proposing to sell private placement securities other than in a
registered offering and otherwise than pursuant to Rule 144 will have a substantial burden of proof in establishing that an exemption from registration is available for such offers or sales, and that such persons and their respective brokers who
participate in such transactions do so at their own risk. 

 All capitalized terms used but not defined herein shall have the
meaning ascribed to such terms in the Promissory Note. 
  

			
	Purchaser:
                                         
                           
	
	Date:
                                         
                   

  
 2

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