Exhibit 10.3

RESTRICTED STOCK AGREEMENT

This RESTRICTED STOCK AGREEMENT (the “ Agreement ”), dated as of August 6, 2007 (the “ Date of Grant ”), is entered into by and between GUESS?, INC., a Delaware corporation (the “ Company ”), and Carlos Alberini (the “ Grantee ”).

RECITALS

WHEREAS , the Company maintains the Guess?, Inc. 2004 Equity Incentive Plan (the “ Plan ”).

WHEREAS , the Compensation Committee of the Company’s Board of Directors (the “ Committee ”) has determined to grant a restricted stock award (the “ Award ”) to the Grantee under the Plan in order to increase Grantee’s participation in the success of the Company and as an inducement to enter into the Executive Employment Agreement dated as of August 6, 2007 by and between the Company and the Grantee (the “ Employment Agreement ”);

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.  The 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.  In the event of any conflict or inconsistency between the Plan and this Award Agreement, the Plan shall govern.

2.                                        Grant of Restricted Stock .  The Grantee shall be entitled to purchase 150,000 restricted shares of the Company’s common stock, par value $0.01 per share (the “ Common Stock ”), pursuant to the terms and conditions of this Agreement (the “ Restricted Stock ”).

3.                                        Purchase Price .  The Grantee shall pay to the Company, in cash, an aggregate purchase price of $ 1,500 (the “ Purchase Price ”), which amount is equal to the aggregate amount of the par value of the Restricted Stock.  Such payment of the Purchase Price shall be made to the Company within 30 days after the date hereof.

4.                                        Restricted Period .  Subject to Section 7 below, the Award shall vest and restrictions shall lapse as follows (the period from the date hereof through each applicable vesting date, the “ Restricted Period ”):

A.                                    If, for the third and fourth fiscal quarters of the Company’s 2008 fiscal year, considered together as one period (the “ Second Half of Fiscal 2008 ”), or for any one of the four whole fiscal years of the Company (“ Fiscal Year ”) commencing on or after February 3, 2008 during the Original Employment Term (as defined in the Employment Agreement), the Company shall record earnings per share (“ Earnings per Share ”) growth of greater than the Applicable Annual Target (as defined below) as

                                                compared to the same fiscal period from the immediately preceding Fiscal Year, then 20% of the Restricted Stock shall become vested as of the first business day following the issuance of the Company’s financial statement for such period, provided the Grantee is then employed by the Company.  If the Earnings per Share growth requirement is not met for any such period, all of the shares of the Restricted Stock eligible for vesting for that period shall vest on the first business day following the issuance of the Company’s financial statement for any subsequent Fiscal Year during the Original Employment Term (as defined in the Employment Agreement) if the cumulative compounded average Earnings per Share growth from the Second Half of Fiscal 2008 through such subsequent Fiscal Year is more than the Applicable Cumulative Target (as defined below) for such subsequent Fiscal Year.  The “ Applicable Annual Target ” for each of the Second Half of Fiscal 2008 and the first and second whole Fiscal Years that commences on or after February 3, 2008 is a growth in Earnings per Share of 15% or more as compared to the same fiscal period from the immediately preceding Fiscal Year.  The “ Applicable Cumulative Target ” for each of the Second Half of Fiscal 2008 and the first and second whole Fiscal Years that commences on or after February 3, 2008 is a 15% rate of cumulative compounded average Earnings per Share growth.  For the avoidance of doubt, the Applicable Cumulative Target for the first whole fiscal year commencing on February 3, 2008 shall be calculated by multiplying the sum of (A) the Company’s actual Earnings per Share for the first and second fiscal quarters of the Company’s 2008 Fiscal Year and (B) the Applicable Annual Target of Earnings per Share for the Second Half of Fiscal 2008, by 1.15.  The “Applicable Annual Target” and the “Applicable Cumulative Target” for each of the third and fourth whole Fiscal Years that commences on or after February 3, 2008 will be a rate of Earnings per Share growth and cumulative compounded average Earnings per Share growth, respectively, determined by the Compensation Committee of the Board in its sole discretion not later than the end of the first quarter of such Fiscal Year; provided that the outcome is substantially uncertain at the time the Compensation Committee actually establishes each such target.  The parties acknowledge and agree that the grant of Restricted Stock made hereby is intended to qualify as performance-based compensation that is exempt from the deductibility limitations of Section 162(m) of the Internal Revenue Code.

B.                                      For purposes of this Agreement, Earnings per Share shall be equal to the basic earnings per share calculated in accordance with accounting principles generally accepted in the United States and as reported in the Company’s financial statements as filed with the Securities and Exchange Commission, except that certain adjustments may be made for certain non-recurring or unusual non-cash items recognized in accordance with accounting principles generally accepted in the United States including, but not limited to, any write-offs of unamortized deferred financing costs

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                                                and any asset impairment write-downs, which the Committee determines in its sole discretion to exclude for purposes of this Agreement.

5.                                        Rights of a Stockholder .  From and after the Date of Grant and for so long as the Restricted Stock is held by or for the benefit of the Grantee, the Grantee shall have all the rights of a stockholder of the Company with respect to the Restricted Stock, including but not limited to the right to receive dividends, if applicable, and the right to vote such shares.

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 and kind of securities subject to the Award.  If any adjustment is made under Section 16(b) of the Plan, the restrictions applicable to the shares of Restricted Stock shall continue in effect with respect to any consideration or other securities (the “ Restricted Property ” and, for the purposes of this Award Agreement, “Restricted Stock” shall include “Restricted Property,” unless the context otherwise requires) received in respect of such Restricted Stock.  Such Restricted Property shall vest at such times in such proportion as the shares of Restricted Stock to which the Restricted Property is attributable.  To the extent that the Restricted Property includes any cash (other than regular cash dividends provided for in Section 5 hereof), such cash shall be invested, pursuant to policies established by the Committee, in interest bearing, FDIC-insured (subject to applicable insurance limits) deposits of a depository institution selected by the Committee, the earnings on which shall be added to and become a part of the Restricted Property.

7.                                        Effect of Cessation of Employment .

A.                                    The shares of the Restricted Stock not yet vested or forfeited shall become 100% vested in the event that there is a Change in Control (as defined below), while the Grantee is employed by the Company or an affiliate during the Employment Term (as defined in the Employment Agreement).  For this purpose, the term “ Change in Control ” is used as defined in the Plan except that in no event shall a “Change in Control” be triggered pursuant to clause (A) of such term as so defined unless the Acquiring Person becomes the Beneficial Owner of twenty percent (20%) or more of the then outstanding shares of Common Stock or the Combined Voting Power