CREDIT AGREEMENT Dated as of February 13, 2014 among SOTHEBY’S, a Delaware corporation SOTHEBY’S, INC., OATSHARE LIMITED, SOTHEBY’S, a company registered in England, and SOTHEBY’S HONG KONG LIMITED as Borrowers, THE OTHER CREDIT PARTIES SIGNATORY...

EXHIBIT 10.1

EXECUTION COPY

CREDIT AGREEMENT

Dated as of February 13, 2014

among

SOTHEBY’S,

a Delaware corporation

SOTHEBY’S, INC.,

OATSHARE LIMITED,

SOTHEBY’S,

a company registered in England,

and

SOTHEBY’S HONG KONG LIMITED

as Borrowers,

THE OTHER CREDIT PARTIES SIGNATORY HERETO,

as Credit Parties,

THE LENDERS SIGNATORY HERETO

FROM TIME TO TIME,

as Lenders,

GENERAL ELECTRIC CAPITAL CORPORATION,

as Administrative Agent, Collateral Agent and a Lender

and

GE CAPITAL MARKETS, INC., ▇.▇. ▇▇▇▇▇▇ SECURITIES LLC and HSBC BANK USA, N.A.

as Joint Lead Arrangers and Joint Bookrunners

Auction Revolving Credit Facility

TABLE OF CONTENTS

Page

1.	AMOUNT AND TERMS OF CREDIT		1

	1.1	Credit Facilities	1
	1.2	Letters of Credit	8
	1.3	Prepayments; Commitment Reductions	8
	1.4	Use of Proceeds	12
	1.5	Interest and Applicable Margins	12
	1.6	Eligible Art Loans	16
	1.7	Eligible Art Inventory	20
	1.8	Eligible Extended Term Art Receivables	22
	1.9	Cash Management Systems	24
	1.10	Fees	24
	1.11	Receipt of Payments	25
	1.12	Application and Allocation of Payments	25
	1.13	Loan Account and Accounting	26
	1.14	Indemnity	27
	1.15	Access	28
	1.16	Taxes	29
	1.17	Capital Adequacy; Increased Costs; Illegality	33
	1.18	Credit Support	35
	1.19	Conversion to Dollars and Foreign Currency	36
	1.20	Judgment Currency; Contractual Currency	36
	1.21	Currency of Account	37

2.	CONDITIONS PRECEDENT		37

	2.1	Conditions to Effectiveness of Agreement and the Initial Loans	38
	2.2	Further Conditions to Each Loan	39

3.	REPRESENTATIONS AND WARRANTIES		40

	3.1	Corporate Existence; Compliance with Law	40
	3.2	Executive Offices, Collateral Locations, FEIN	41
	3.3	Corporate Power, Authorization, Enforceable Obligations	41
	3.4	Financial Disclosures	42
	3.5	Material Adverse Effect	43
	3.6	Ownership of Property; Liens	43
	3.7	Labor Matters	43
	3.8	Ventures, Subsidiaries and Affiliates; Outstanding Stock and Indebtedness	43
	3.9	Government Regulation	44
	3.10	Margin Regulations	44

	3.11	Taxes	44
	3.12	ERISA/U.K. Pension Plans	45
	3.13	Litigation	46
	3.14	Brokers	46
	3.15	Intellectual Property	46
	3.16	Full Disclosure	47
	3.17	Environmental Matters	47
	3.18	Insurance	48
	3.19	Deposit	48
	3.20	[Reserved]	48
	3.21	Bonding; Licenses	48
	3.22	Solvency	48
	3.23	Sale-Leasebacks	49
	3.24	U.S. Sanctions, Money-Laundering and Terrorism Regulatory Matters	49
	3.25	Lending and Auction Regulatory Matters	50

4.	FINANCIAL STATEMENTS AND INFORMATION		51

	4.1	Reports and Notices	51

5.	AFFIRMATIVE COVENANTS		51

	5.1	Maintenance of Existence and Conduct of Business	51
	5.2	Payment of Charges	51
	5.3	Books and Records	52
	5.4	Insurance; Damage to or Destruction of Collateral	52
	5.5	Compliance with Laws	53
	5.6	Supplemental Disclosure	53
	5.7	Intellectual Property	54
	5.8	Environmental Matters	54
	5.9	Landlords’ Agreements, Bailee Letters and Real Estate Purchases	55
	5.10	Lending and Auction Regulatory Matters	55
	5.11	Further Assurances	56
	5.12	Art Loans, Art Inventory and Extended Term Art Receivables	56
	5.13	Money-Laundering and Terrorism Regulatory Matters	56
	5.14	Subsidiary Loan Documents	57
	5.15	Immaterial Subsidiaries	59
	5.16	York Avenue Transactions	60
	5.17	Auction Guaranties	60
	5.18	Data Protection Matters	60

6.	NEGATIVE COVENANTS		60

	6.1	Mergers, Subsidiaries, Etc.	60
	6.2	Investments; Loans and Revolving Credit Advances	61
	6.3	Indebtedness	62
	6.4	Employee Loans and Affiliate Transactions	64
	6.5	Capital Structure and Business	65

	6.6	Guaranteed Indebtedness	65
	6.7	Liens	65
	6.8	Sale of Stock and Assets	66
	6.9	ERISA	67
	6.10	Financial Covenants	67
	6.11	Hazardous Materials	67
	6.12	Sale Leasebacks	67
	6.13	Restricted Payments	67
	6.14	Change of Corporate Name, State of Incorporation or Location; Change of Fiscal Year	69
	6.15	No Impairment of Intercompany Transfers	69
	6.16	Real Estate Purchases	70
	6.17	Changes Relating to Material Contracts	70
	6.18	Use of Proceeds	70

7.	TERM		70

	7.1	Termination	70
	7.2	Survival of Obligations Upon Termination of Financing Arrangements	71

8.	EVENTS OF DEFAULT; RIGHTS AND REMEDIES		71

	8.1	Events of Default	71
	8.2	Remedies	73
	8.3	Waivers by Credit Parties	73

9.	ASSIGNMENT AND PARTICIPATIONS; APPOINTMENT OF AGENT		74

	9.1	Assignment and Participations	74
	9.2	Appointment of the Administrative Agent and the Collateral Agent	78
	9.3	Agents’ Reliance, Etc.	79
	9.4	GE Capital and Affiliates	80
	9.5	Lender Credit Decision	80
	9.6	Indemnification	80
	9.7	Successor Agents and Fronting Lender	81
	9.8	Setoff and Sharing of Payments	82
	9.9	Advances; Payments; Non-Funding Lenders; Information; Actions in Concert	83
	9.10	Release of Guarantors or ▇▇▇▇▇▇▇▇▇▇	▇▇

▇▇.	SUCCESSORS AND ASSIGNS		91

	10.1	Successors and Assigns	91

11.	MISCELLANEOUS		91

	11.1	Complete Agreement; Modification of Agreement	91
	11.2	Amendments and Waivers	92

iii

	11.3	Fees and Expenses	94
	11.4	No Waiver	95
	11.5	Remedies	95
	11.6	Severability	96
	11.7	Conflict of Terms	96
	11.8	Confidentiality	96
	11.9	GOVERNING LAW	97
	11.10	Notices	98
	11.11	Section Titles	99
	11.12	Counterparts; Facsimile Signature	99
	11.13	WAIVER OF JURY TRIAL	99
	11.14	Press Releases and Related Matters	100
	11.15	Reinstatement	100
	11.16	Advice of Counsel	100
	11.17	No Strict Construction	100
	11.18	PATRIOT Act	100
	11.19	Creditor-Debtor Relationship	101
	11.20	Electronic Transmissions	101

12.	CROSS-GUARANTY		102

	12.1	Cross-Guaranty	102
	12.2	Waivers by Borrowers	103
	12.3	Benefit of Guaranty	103
	12.4	Waiver of Subrogation, Etc.	103
	12.5	Subordination by Credit Parties	104
	12.6	Election of Remedies	105
	12.7	Liability Cumulative	106

INDEX OF APPENDICES


Annex A (Recitals)	-	Definitions
Annex B (Section 1.2)	-	Letters of Credit
Annex C (Section 1.9)	-	Cash Management System
Annex D (Section 2.1(a))	-	Closing Checklist
Annex E (Section 4.1(a))	-	Financial Statements and Projections -- Reporting
Annex F (Section 4.1(b))	-	Collateral Reports
Annex G (Section 6.10)	-	Financial Covenants
Annex H (Section 9.9(a))	-	Lenders’ Wire Transfer Information
Annex I (Section 11.10)	-	Notice Addresses
Annex J (from Annex A -	-
Commitments definition)		Commitments as of Closing Date

Exhibit 1.1(a)(i)	-	Form of Notice of Revolving Credit Advance
Exhibit 1.1(a)(ii)-A	-	Form of Revolving Note (Domestic Borrowers)
Exhibit 1.1(a)(ii)-B	-	Form of Revolving Note (Foreign Borrowers)
Exhibit 1.1(a)(ii)-C	-	Form of Fronting Lender Note
Exhibit 1.1(b)(ii)-A	-	Form of Swing Line Note (Domestic Borrowers)
Exhibit 1.1(b)(ii)-B	-	Form of Swing Line Note (Foreign Borrowers)
Exhibit 1.5(e)	-	Form of Notice of Conversion/Continuation
Exhibit 4.1(A)	-	Form of Borrowing Base Certificate
Exhibit 4.1(B)	-	Form of Art Loan Receivables Report
Exhibit 4.1(C)	-	Form of Art Inventory Report
Exhibit 4.1(D)	-	Form of Extended Term Art Receivables Report
Exhibit 9.1(a)	-	Form of Assignment Agreement
Exhibit B	-	Application for Letter of Credit
Exhibit C	-	Form of Compliance Certificate
Schedule 1.1	-	Agents’ Representatives
Schedule 5.14	-	Subsidiary Loan Documents
Disclosure Schedule 3.1	-	Type of Entity; State of Organization
Disclosure Schedule 3.2 Disclosure Schedule 3.4(a)	- -	Executive Offices, Collateral Locations, FEIN Financial Statements
Disclosure Schedule 3.6	-	Real Estate and Leases
Disclosure Schedule 3.7	-	Labor Matters
Disclosure Schedule 3.8	-	Ventures, Subsidiaries and Affiliates; Outstanding Stock
Disclosure Schedule 3.11	-	Tax Matters
Disclosure Schedule 3.12(a)	-	ERISA Plans
Disclosure Schedule 3.12(c)	-	U.K. Pension Plans
Disclosure Schedule 3.13(a)	-	Litigation
Disclosure Schedule 3.14	-	Brokers
Disclosure Schedule 3.15	-	Intellectual Property
Disclosure Schedule 3.17	-	Hazardous Materials
Disclosure Schedule 3.18	-	Insurance

Disclosure Schedule 3.19	-	Deposit and Disbursement Accounts
Disclosure Schedule 3.21	-	Bonds; Patent, Trademark Licenses
Disclosure Schedule 5.15	-	Immaterial Subsidiaries
Disclosure Schedule 5.16	-	York Avenue Lender Recourse
Disclosure Schedule 6.3	-	Indebtedness
Disclosure Schedule 6.4(a)	-	Transactions with Affiliates
Disclosure Schedule 6.7	-	Existing Liens

This CREDIT AGREEMENT (this “Agreement”), dated as of February 13, 2014, among Sotheby’s, a Delaware corporation (“Parent”), Sotheby’s, Inc., a New York corporation (“Sotheby’s, Inc.” and, collectively with Parent, the “Domestic Borrowers”), Oatshare Limited, a company registered in England (“Oatshare”), Sotheby’s, a company registered in England (“Sotheby’s U.K.” and, collectively, with Oatshare, the “U.K. Borrowers”), and Sotheby’s Hong Kong Limited, a company incorporated in Hong Kong (“Sotheby’s H.K.” and, collectively with the U.K. Borrowers, the “Foreign Borrowers”; the Domestic Borrowers and the Foreign Borrowers collectively being referred to herein as the “Borrowers”); the other Credit Parties signatory hereto; General Electric Capital Corporation, a Delaware corporation (in its individual capacity, “GE Capital”), for itself, as a Lender and as Fronting Lender, as Administrative Agent for the Lenders and the Fronting Lender, and Collateral Agent for the Secured Parties, and the other Lenders signatory hereto from time to time.

RECITALS

WHEREAS, the Borrowers have requested, and the Lenders have agreed to make available to the Borrowers, a revolving credit facility upon and subject to the terms and conditions set forth in this Agreement to provide for working capital and other general corporate purposes of the Borrowers and their Subsidiaries;

WHEREAS, the Borrowers have agreed to secure all of the Secured Obligations by granting to the Collateral Agent, for the benefit of the Collateral Agent and the other Secured Parties, a security interest in and lien upon all or substantially all of their existing and after-acquired personal property; and

WHEREAS, capitalized terms used in this Agreement shall have the meanings ascribed to them in Annex A and, for purposes of this Agreement and the other Loan Documents, the rules of construction set forth in Annex A shall govern. All Annexes, Disclosure Schedules, Exhibits and other attachments (collectively, “Appendices”) hereto, or expressly identified to this Agreement, are incorporated herein by reference, and taken together with this Agreement, shall constitute but a single agreement. These Recitals shall be construed as part of the Agreement.

NOW, THEREFORE, in consideration of the premises and the mutual covenants hereinafter contained, and for other good and valuable consideration, the parties hereto hereby agree as follows:

1. AMOUNT AND TERMS OF CREDIT

1.1	Credit Facilities.

(a) Revolving Credit Facility.

(i) Subject to the terms and conditions hereof, (a) each Lender agrees to make available, from time to time until the Commitment Termination Date, its Pro Rata Share of advances (each, a “Dollar Revolving Credit Advance”) in Dollars to Domestic Borrowers and (b) except as otherwise provided in the last two sentences of this paragraph, each of the Foreign Currency Lenders and the Fronting Lender agrees to make available, from time to time until the Commitment Termination Date, its Pro Rata Share (or, in the case of the Fronting Lender, the Fronted Percentage) of advances (each a “Foreign Currency Revolving Credit Advance”) in

Foreign Currencies to the Foreign Borrowers. Each Non-Foreign Currency Lender shall purchase an undivided participation interest in each such Foreign Currency Revolving Credit Advance made by the Fronting Lender in accordance with Section 9.9(e)(i). The Fronting Lender shall not be required to, and shall not, fund its share of any Foreign Currency Revolving Credit Advance at any time that any condition precedent set forth in Section 2.2 is not satisfied if the Fronting Lender shall have received at least one Business Day’s prior written notice from Non-Foreign Currency Lenders having Commitments equal to or greater than 66 2/3% of the Fronted Percentage instructing it not to fund its share of a Foreign Currency Revolving Credit Advance. The Pro Rata Share of the aggregate Revolving Loan of any Lender shall not at any time exceed its separate Commitment. The obligations of each Lender to make Loans or purchase participation interests therein under this Agreement shall be several and not joint. Until the Commitment Termination Date, Borrowers may borrow, repay and reborrow under this Section 1.1(a); provided, that (i) the amount of any Revolving Credit Advance to be made at any time to a Domestic Borrower shall not exceed Domestic Borrowing Availability at such time and (ii) the Dollar Equivalent of the amount of any Revolving Credit Advance to be made at any time to a Foreign Borrower shall not exceed Foreign Borrowing Availability at such time. The Dollar Equivalent of each outstanding Revolving Credit Advance, Swing Line Advance and Letter of Credit Obligation shall be recalculated hereunder on each date on which it shall be necessary to determine the Revolving Loan Outstandings, as determined by the Administrative Agent in its sole discretion; provided, that the Administrative Agent shall recalculate the Dollar Equivalent of the Revolving Loan Outstandings at least one time each calendar month and otherwise in accordance with Section 1.19. Domestic Borrowing Availability or Foreign Borrowing Availability, or both, may be reduced by Reserves imposed by the Administrative Agent in its sole reasonable credit judgment. Each Revolving Credit Advance shall be made on notice by Borrower Representative to one of the representatives of the Administrative Agent identified in Schedule 1.1 at the address specified therein. Any such notice must be given no later than (x) 11:00 a.m. (New York time) on the Business Day of the proposed Revolving Credit Advance, in the case of an Index Rate Loan in Dollars or (y) 11:00 a.m. (New York time) on the date which is three (3) Business Days prior to the proposed Revolving Credit Advance, in the case of a LIBOR Loan. Each such notice (a “Notice of Revolving Credit Advance”) must be given in writing (by telecopy or overnight courier) or Electronic Transmission substantially in the form of Exhibit 1.1(a)(i), and shall include the information required in such Exhibit and such other information as may be required by the Administrative Agent. If any Borrower desires to have any Revolving Credit Advance be made as a LIBOR Loan, Borrower Representative must comply with Section 1.5(e). A Revolving Credit Advance may not be drawn in a Foreign Currency if the Administrative Agent determines at any time prior to 12:00 p.m. (New York time) on the date of such proposed Revolving Credit Advance that by reason of any change in currency availability, unusual instability in currency exchange rates or exchange controls it is, or will be, impracticable for such Revolving Credit Advance to be made in such Foreign Currency. In such event, the proposed Revolving Credit Advance shall be made in Dollars.

(ii) If requested by any Lender, each Borrower shall execute and deliver to such Lender a note to evidence the Commitment of, and Revolving Credit Advances made by, that Lender. Each note shall be in the principal amount of the Commitment of the applicable Lender, dated the Closing Date (or such later date as such Lender becomes party to this Agreement pursuant to Section 9.1(a) or modifies its Commitment pursuant to Section

9.1(a)) and substantially in the form of Exhibit 1.1(a)(ii)-A (in the case of the Domestic Borrowers) or Exhibit 1.1(a)(ii)-B (in the case of the Foreign Borrowers) (each a “Revolving Note” and, collectively, the “Revolving Notes”). Each Revolving Note shall represent the joint and several obligation of the applicable Borrowers to pay the amount of the applicable Lender’s Commitment or, if less, such Lender’s Pro Rata Share of the aggregate unpaid principal amount of all Revolving Credit Advances made to the Domestic Borrowers or the Foreign Borrowers, as applicable, together with interest thereon as prescribed in Section 1.5. In addition, if requested by the Fronting Lender, each Foreign Borrower shall execute and deliver to the Fronting Lender a note to evidence the obligation of, and Foreign Currency Revolving Credit Advances made by, the Fronting Lender. Such note shall be in the principal amount of the Foreign Currency Subfacility Limit dated the Closing Date (or such later date as such Person shall become the Fronting Lender pursuant to Section 9.7(b)) and substantially in the form of Exhibit 1.1(a)(ii)-C (the “Fronting Lender Note”). The Fronting Lender Note shall represent the joint and several obligation of the Foreign Borrowers to pay the Fronted Percentage of the aggregate unpaid principal amount of all Foreign Currency Revolving Credit Advances made to the Foreign Borrowers, together with interest thereon as prescribed in Section 1.5. The entire unpaid balance of the aggregate Revolving Loan and all other non-contingent Obligations shall be immediately due and payable in full in immediately available funds on the Commitment Termination Date.

(iii) Anything in this Agreement to the contrary notwithstanding, at the request of Borrower Representative, in its discretion the Administrative Agent may (but shall have absolutely no obligation to), make Revolving Credit Advances (i) to Domestic Borrowers on behalf of Lenders in Dollars in amounts that cause the sum of (a) the aggregate outstanding balance of the Revolving Credit Advances and Swing Line Advances outstanding to the Domestic Borrowers plus (b) the Dollar Equivalent of the outstanding amount of Letter of Credit Obligations incurred for the benefit of any Domestic Borrowers to exceed the Domestic Borrowing Base or (ii) to Foreign Borrowers on behalf of the Foreign Currency Lenders and the Fronting Lender in any Foreign Currency in amounts that cause the sum of (a) the Dollar Equivalent of the aggregate outstanding balance of the Revolving Credit Advances and Swing Line Advances outstanding to the Foreign Borrowers plus (b) the Dollar Equivalent of the outstanding amount of Letter of Credit Obligations incurred for the benefit of any Foreign Borrowers to exceed the Foreign Borrowing Base (any such excess Revolving Credit Advances are herein referred to collectively as “Overadvances”); provided, that (A) no such event or occurrence shall cause or constitute a waiver of the Administrative Agent’s, Swing Line Lender’s, Fronting Lender’s or Lenders’ right to refuse to make any further Overadvances, Swing Line Advances or Revolving Credit Advances, or incur any Letter of Credit Obligations, as the case may be, at any time that an Overadvance exists and (B) no Overadvance shall result in a Default or Event of Default based on Borrowers’ failure to comply with Section 1.3(b)(ii) for so long as the Administrative Agent permits such Overadvance to be outstanding, but solely with respect to the amount of such Overadvance. In addition, Overadvances may be made even if the conditions to lending set forth in Section 2.2 have not been met. All Overadvances shall constitute Index Rate Loans (in the case of Overadvances denominated in Dollars) or LIBOR Loans having a one-month LIBOR Period (in the case of Overadvances denominated in any Foreign Currency), shall bear interest at the Default Rate and shall be payable on the earlier of demand or the Commitment Termination Date. Except as otherwise provided in Section 1.12(b), the authority of the Administrative Agent to make Overadvances is limited to an aggregate amount not to exceed a Dollar Equivalent of $15,000,000 at any time, shall not cause the Dollar

Equivalent of the aggregate Revolving Loan to exceed the Maximum Amount, and may be revoked prospectively by a written notice to the Administrative Agent signed by the Requisite Lenders; provided further, that Overadvances made other than for the purpose of protecting or preserving the Collateral shall not remain outstanding for more than sixty (60) days without the written consent of Requisite Lenders. The Administrative Agent shall use commercially reasonable efforts to provide notice to Lenders following the making of an Overadvance (unless one or more Overadvances are already outstanding as of the date of such Overadvance).

(iv) From the Closing Date until August 13, 2018, the Borrowers may request that any additional Person(s) may become party hereto as a Lender and provide additional Commitments or any Lender may agree to increase its Commitment (any such Person or Lender, an “Increase Lender”) pursuant to a joinder agreement (an “Incremental Joinder”) in form and substance reasonably acceptable to the Administrative Agent; provided that (A) the sum of (x) the aggregate amount of all such additional Commitments or increases in the Commitments of the Increase Lenders under this Section 1.1(a)(iv) plus (y) the aggregate amount of all additional “Commitments” or increases in the “Commitments” of the “Increase Lenders” under Section 1.1(a)(iv) of the SFS Revolving Credit Agreement, does not exceed $100,000,000 and (B) no Default or Event of Default has occurred and is continuing. The Incremental Joinder may, without the consent of any other Lenders, effect such amendments to this Agreement and the other Loan Documents as may be necessary or appropriate, in the reasonable opinion of the Administrative Agent and the Borrowers, to effect the provisions of this Section 1.1(a)(iv). The consent of the Administrative Agent (not to be unreasonably withheld or delayed in the case of any Qualified Assignee) shall be required prior to the addition of any Person as a Lender or the increase of the Commitment of any Lender pursuant to this Section 1.1(a)(iv). Each Increase Lender shall accept an assignment from the existing Lenders (and the Fronting Lender, as applicable), and each such existing Lender (and the Fronting Lender, as applicable) shall make a ratable assignment to such Increase Lender, of an interest in the Revolving Loan Outstandings such that, after giving effect thereto, the Revolving Loan Outstandings shall be held ratably by the Lenders (including the Increase Lenders). Assignments pursuant to the immediately preceding sentence shall be automatic after giving effect to any addition of any Person as a Lender or any increase of the Commitment of any Lender, in either case pursuant to this Section 1.1(a)(iv), and shall be made in exchange for the principal amount assigned plus accrued and unpaid interest thereon and any accrued and unpaid Fees in respect thereof. In addition, each applicable Borrower shall pay any LIBOR breakage costs due to any existing Lender in accordance with Section 1.14(b) (with any payment to any existing Lender in respect of the assignment of any principal amount of any Loan pursuant to this Section 1.1(a)(iv) being treated as a repayment of a Loan for purposes of such Section 1.14(b)). Nothing contained in this Section 1.1(a)(iv) shall constitute, or otherwise be deemed to be, a commitment on the part of any Lender to increase its Commitment hereunder at any time.

(b) Swing Line Facility.

(i) The Administrative Agent shall notify the Swing Line Lender upon the Administrative Agent’s receipt of any Notice of Revolving Credit Advance in respect of a Revolving Credit Advance (a) to be denominated in Dollars and to bear interest by reference to the Dollar Index Rate, (b) to be denominated in Sterling and to bear interest by reference to the Sterling Index Rate, (c) to be denominated in Euro and to bear interest by reference to the Euro

Index Rate or (d) to be denominated in Hong Kong Dollars and to bear interest by reference to the Hong Kong Dollars Index Rate. Subject to the terms and conditions hereof, the Swing Line Lender may, but shall have no duty to, in accordance with any such notice, make available from time to time until the Commitment Termination Date advances (each, a “Swing Line Advance”) (a) in Dollars to the Domestic Borrowers or (b) in any Foreign Currency to the Foreign Borrowers. The provisions of this Section 1.1(b) shall not relieve Lenders or the Fronting Lender of their obligations to make Revolving Credit Advances under Section 1.1(a); provided, that if the Swing Line Lender makes a Swing Line Advance pursuant to any such notice, such Swing Line Advance shall be in lieu of any Revolving Credit Advance that otherwise may be made by the Lenders or the Fronting Lender pursuant to such notice. The aggregate amount of Swing Line Advances outstanding shall not exceed at any time the Swing Line Availability as of such time. Until the Commitment Termination Date, the Borrowers may from time to time borrow, repay and reborrow under this Section 1.1(b). Each Swing Line Advance shall be made pursuant to a Notice of Revolving Credit Advance delivered to the Administrative Agent by Borrower Representative on behalf of the applicable Borrower in accordance with Section 1.1(a). Any such notice must be given no later than (x) 3:00 p.m. (New York time) on the Business Day of the proposed Swing Line Advance, in the case of a Swing Line Advance in Dollars or (y) 10:00 a.m. (New York time) on the date which is (A) two (2) Business Days prior to the proposed Swing Line Advance, in the case of a Swing Line Advance denominated in Sterling or Euro and (B) three (3) Business Days prior to the proposed Swing Line Advance, in the case of a Swing Line Advance denominated in Hong Kong Dollars. Unless the Swing Line Lender has received at least one Business Day’s prior written notice from Requisite Lenders instructing it not to make a Swing Line Advance, the Swing Line Lender shall, notwithstanding the failure of any condition precedent set forth in Sections 2.2, be entitled to fund that Swing Line Advance, and to have each Lender make Revolving Credit Advances in accordance with Section 1.1(b)(iii) or 1.1(b)(iv), as applicable, or purchase participating interests in accordance with Section 1.1(b)(v). If any Lender shall fail to make available to the Administrative Agent its Pro Rata Share (or, in the case of any Swing Line Advance in any Foreign Currency, the Fronting Lender shall fail to make available the Fronted Percentage) of any Revolving Credit Advance in accordance with Section 1.1(b)(iii) or 1.1(b)(iv), as applicable, Borrowers shall repay the outstanding principal amount of the portion of the Swing Line Loan then outstanding due to such failure upon demand therefor by the Administrative Agent.

(ii) If requested by the Swing Line Lender, each Borrower shall execute and deliver to the Swing Line Lender a promissory note to evidence the Swing Line Commitment. Such note shall be in the principal amount of the Swing Line Commitment of the Swing Line Lender, dated the Closing Date and substantially in the form of Exhibit 1.1(b)(ii)-A (in the case of the Domestic Borrowers) or Exhibit 1.1(b)(ii)-B (in the case of the Foreign Borrowers) (each, a “Swing Line Note” and, collectively, the “Swing Line Notes”). Each Swing Line Note shall represent the joint and several obligation of the applicable Borrowers to pay the amount of the Swing Line Commitment or, if less, the aggregate unpaid principal amount of all Swing Line Advances made to the Domestic Borrowers or the Foreign Borrowers, as applicable, together with interest thereon as prescribed in Section 1.5. The entire unpaid balance of the Swing Line Loan and all other noncontingent Obligations shall be immediately due and payable in full in immediately available funds on the Commitment Termination Date if not sooner paid in full.

(iii) The Swing Line Lender, at any time and from time to time no less frequently than once weekly, shall on behalf of the Borrower Representative (and the Borrower Representative hereby irrevocably authorizes the Swing Line Lender to so act on its behalf) request each Lender (including the Swing Line Lender) to make available to the Domestic Borrowers its Pro Rata Share of a Revolving Credit Advance in Dollars equal to the principal amount of the portion of the Swing Line Loan denominated in Dollars and outstanding on the date such notice is given (the “Refunded Dollar Swing Line Loan”). Unless any of the events described in Sections 8.1(g) or 8.1(h) has occurred (in which event the procedures of Section 1.1(b)(v) shall apply) and regardless of whether the conditions precedent set forth in this Agreement to the making of a Revolving Credit Advance are then satisfied, each Lender shall disburse directly to the Administrative Agent its Pro Rata Share of such Revolving Credit Advance on behalf of the Swing Line Lender prior to 3:00 p.m. (New York time) in immediately available funds in Dollars on the Business Day next succeeding the date that notice is given. The proceeds of each such Revolving Credit Advance shall be immediately paid to the Swing Line Lender and applied to repay the Refunded Dollar Swing Line Loan.

(iv) The Swing Line Lender, at any time and from time to time no less frequently than once weekly, shall on behalf of the Borrower Representative (and the Borrower Representative hereby irrevocably authorizes the Swing Line Lender to so act on its behalf) request each Foreign Currency Lender (including the Swing Line Lender, as applicable) and the Fronting Lender to make available to the Foreign Borrowers its Pro Rata Share (or, in the case of the Fronting Lender, the Fronted Percentage) of a Revolving Credit Advance in a Foreign Currency equal to the principal amount of the portion of the Swing Line Loan denominated in such Foreign Currency and outstanding on the date such notice is given (the “Refunded Foreign Currency Swing Line Loan”). Unless any of the events described in Sections 8.1(g) or 8.1(h) has occurred (in which event the procedures of Section 1.1(b)(v) shall apply) and regardless of whether the conditions precedent set forth in this Agreement to the making of a Revolving Credit Advance are then satisfied, each Foreign Currency Lender and the Fronting Lender shall disburse directly to the Administrative Agent its Pro Rata Share (or, in the case of the Fronting Lender, the Fronted Percentage) of such Revolving Credit Advance on behalf of the Swing Line Lender prior to 3:00 p.m. (New York time) in immediately available funds in such Foreign Currency on the second Business Day next succeeding the date that notice is given. The proceeds of each such Revolving Credit Advance shall be immediately paid to the Swing Line Lender and applied to repay the Refunded Foreign Currency Swing Line Loan. Each Non-Foreign Currency Lender shall purchase an undivided participation interest in each such Foreign Currency Revolving Credit Advance from the Fronting Lender in accordance with Section 9.9(e)(i).

(v) If, prior to refunding a portion of the Swing Line Loan with a Revolving Credit Advance pursuant to Section 1.1(b)(iii) or 1.1(b)(iv), one of the events described in Sections 8.1(g) or 8.1(h) has occurred, then, subject to the provisions of Section 1.1(b)(vi) below:

(A) in the case of any portion of the Swing Line Loan denominated in Dollars, each Lender shall, on the date such Revolving Credit Advance was to have been made pursuant to Section 1.1(b)(iii), purchase from the Swing Line Lender an undivided participation interest in the Swing Line Loan in an amount equal to its Pro Rata Share of such portion of the Swing Line Loan. Upon request, each Lender shall promptly transfer

to the Swing Line Lender, in immediately available funds in Dollars, the amount of each such participation interest; and

(B) in the case of any portion of the Swing Line Loan denominated in a Foreign Currency, each Foreign Currency Lender and the Fronting Lender shall, on the date such Revolving Credit Advance was to have been made pursuant to Section 1.1(b)(iv), purchase from the Swing Line Lender an undivided participation interest in the Swing Line Loan in an amount equal to its Pro Rata Share (or, in the case of the Fronting Lender, the Fronted Percentage) of such portion of the Swing Line Loan. Upon request, each Foreign Currency Lender and the Fronting Lender shall promptly transfer to the Swing Line Lender, in immediately available funds in such Foreign Currency, the amount of each such participation interest. Each Non-Foreign Currency Lender shall purchase an undivided participation interest in each such participation interest purchased by the Fronting Lender in accordance with Section 9.9(e)(i).

(vi) Each Lender’s and the Fronting Lender’s obligation to make Revolving Credit Advances in accordance with Sections 1.1(b)(iii) and 1.1(b)(iv) and to purchase participation interests in accordance with Section 1.1(b)(v) shall be absolute and unconditional and shall not be affected by any circumstance, including (A) any setoff, counterclaim, recoupment, defense or other right that such Lender or the Fronting Lender may have against the Swing Line Lender, any Borrower or any other Person for any reason whatsoever; (B) the occurrence or continuance of any Default or Event of Default; (C) any inability of any Borrower to satisfy the conditions precedent to borrowing set forth in this Agreement at any time or (D) any other circumstance, happening or event whatsoever, whether or not similar to any of the foregoing. If any Lender or the Fronting Lender does not make available to the Administrative Agent or the Swing Line Lender, as applicable, the amount required pursuant to Sections 1.1(b)(iii), 1.1(b)(iv) or 1.1(b)(v), as the case may be, the Swing Line Lender shall be entitled to recover such amount on demand from such Lender or the Fronting Lender, as applicable, together with interest thereon for each day from the date of non-payment until such amount is paid in full (x) in the case of any portion of the Swing Line Loan denominated in Dollars, at the Federal Funds Rate for the first two Business Days and at the Dollar Index Rate thereafter or (y) in the case of any portion of the Swing Line Loan denominated in a Foreign Currency, at the Sterling Index Rate, Euro Index Rate or the Hong Kong Dollars Index Rate, as applicable.

(c) Reliance on Notices; Appointment of Borrower Representative. The Administrative Agent shall be entitled to rely upon, and shall be fully protected in relying upon, any Notice of Revolving Credit Advance, Notice of Conversion/Continuation or similar notice believed by the Administrative Agent to be genuine. The Administrative Agent may assume that each Person executing and delivering any notice in accordance herewith was duly authorized, unless the responsible individual acting thereon for the Administrative Agent has actual knowledge to the contrary. Each Borrower hereby designates Parent as its representative and agent on its behalf for the purposes of issuing Notices of Revolving Credit Advances and Notices of Conversion/Continuation, giving instructions with respect to the disbursement of the proceeds of the Loans, selecting interest rate options, requesting Letters of Credit, giving and receiving all other notices and consents hereunder or under any of the other Loan Documents and taking all other actions (including in respect of compliance with covenants) on behalf of any Borrower or

Borrowers under the Loan Documents. Borrower Representative hereby accepts such appointment. The Administrative Agent and each Lender may regard any notice or other communication pursuant to any Loan Document from Borrower Representative as a notice or communication from all Borrowers, and may give any notice or communication required or permitted to be given to any Borrower or Borrowers hereunder to Borrower Representative on behalf of such Borrower or Borrowers. Each Borrower agrees that each notice, election, representation and warranty, covenant, agreement and undertaking made on its behalf by Borrower Representative shall be deemed for all purposes to have been made by such Borrower and shall be binding upon and enforceable against such Borrower to the same extent as if the same had been made directly by such Borrower.

(d) Branches and Affiliates of Lenders. Each Lender at its option may make any Loan by causing any domestic or foreign branch or Affiliate of such Lender to make such Loan (and in the case of an Affiliate, the provisions of Sections 1.14(b), 1.16 and 1.17 shall apply to such Affiliate to the same extent as to such Lender); provided that any exercise of such option shall not affect the obligation of the relevant Borrower to repay such Loan in accordance with the terms of this Agreement.

1.2	Letters of Credit.

Subject to and in accordance with the terms and conditions contained herein and in Annex B, Borrower Representative, on behalf of the applicable Borrower (and any Subsidiary thereof that may be a co-applicant on any applicable Letter of Credit), shall have the right to request, and Lenders agree to incur, or purchase participations in, Letter of Credit Obligations.

1.3	Prepayments; Commitment Reductions.

(a) Voluntary Prepayments; Reductions in Commitments.

(i) Borrower Representative shall notify the Administrative Agent (and, in the case of prepayment of a Swing Line Loan, the Swing Line Lender) by telephone confirmed in writing of any prepayment of a Loan hereunder (i) in the case of a LIBOR Loan, not later than 4:00 p.m. (New York time) on the date which is three (3) Business Days before the date of such prepayment, and (ii) in the case of an Index Rate Loan, not later than 11:00 a.m. (New York time) on the date of such prepayment. Each such notice shall be irrevocable and shall specify the prepayment date and the principal amount of each Loan or portion thereof to be prepaid. Promptly following receipt of any such notice, the Administrative Agent shall provide notice to Lenders thereof. Each partial prepayment of any Loan shall be in a minimum amount of (i) if denominated in Dollars, $5,000,000 or an integral multiple of $1,000,000 in excess of such amount, (ii) if denominated in Sterling, £3,000,000 or an integral multiple of £500,000 in excess of such amount, (iii) if denominated in Euro, €3,000,000 or an integral multiple of €500,000 in excess of such amount or (iv) if denominated in Hong Kong Dollars, HK$40,000,000 or an integral multiple of HK$8,000,000 in excess of such amount.

(ii) Borrowers may at any time, on at least five (5) days’ prior written notice by Borrower Representative to the Administrative Agent of the intent of the Borrowers to effect such a reduction and at least two (2) days’ prior written notice by Borrower Representative

to the Administrative Agent of the exact date on which such reduction shall occur, permanently reduce (but not terminate) the Commitment; provided, that (A) any such reduction shall be in a minimum amount of $5,000,000 and integral multiples of $1,000,000 in excess of such amount, (B) the Commitment shall not be reduced to an amount less than the greater of (i) $37,500,000, and (ii) the sum of (x) the Dollar Equivalent of the amount of the aggregate Revolving Loan then outstanding and (y) the Dollar Equivalent of the Swing Line Loan then outstanding, and (C) after giving effect to such reductions, Borrowers shall comply with Sections 1.3(b)(i) and (ii). In addition, Borrowers may at any time, on at least seven (7) days’ prior written notice by Borrower Representative to the Administrative Agent of the intent of the Borrowers to effect such a termination and at least two (2) days’ prior written notice by Borrower Representative to the Administrative Agent of the exact date on which such termination shall occur, terminate the Commitment; provided, that upon such termination, all Loans and other Obligations shall be immediately due and payable in full and all Letter of Credit Obligations shall be cash collateralized or otherwise satisfied in accordance with Annex B hereto. Any reduction or termination of the Commitment must be accompanied by the payment of any LIBOR funding breakage costs in accordance with Section 1.14(b). Upon any such reduction or termination of the Commitment, each Borrower’s right to request Revolving Credit Advances, or request that Letter of Credit Obligations be incurred on its behalf, or request Swing Line Advances, shall simultaneously be permanently reduced or terminated, as the case may be; provided, that a permanent reduction of the Commitment below $50,000,000 shall require a corresponding pro rata reduction in the Foreign Currency Subfacility Limit and the L/C Sublimit to the extent of such reduction below $50,000,000.

(b) Mandatory Prepayments.

(i) If at any time the Dollar Equivalent of the aggregate outstanding balance of the Revolving Loan and the Swing Line Loan exceeds the Maximum Amount, Borrowers shall immediately repay the aggregate outstanding Revolving Credit Advances and Swing Line Advances to the extent required to eliminate such excess. If any such excess remains after repayment in full of the aggregate outstanding Revolving Credit Advances and Swing Line Advances, Borrowers shall provide cash collateral for the Letter of Credit Obligations in the manner set forth in Annex B to the extent of such remaining excess. If at any time the Dollar Equivalent of the aggregate outstanding principal balance of Revolving Credit Advances and Swing Line Advances outstanding to the Foreign Borrowers and the Dollar Equivalent of the outstanding Letter of Credit Obligations incurred on behalf of the Foreign Borrowers, in the aggregate, exceed the Foreign Currency Subfacility Limit, the Foreign Borrowers shall, at the Administrative Agent’s request, immediately repay such Revolving Credit Advances and Swing Line Advances to the extent required to eliminate such excess. If any such excess remains after repayment in full of the aggregate outstanding principal balance of such Revolving Credit Advances and Swing Line Advances, the Foreign Borrowers shall, at the Administrative Agent’s request, provide cash collateral for such Letter of Credit Obligations in the manner set forth in Annex B to the extent of such remaining excess.

(ii) If at any time the Dollar Equivalent of the aggregate outstanding balance of the Revolving Credit Advances and Swing Line Advances outstanding to the Domestic Borrowers and the Dollar Equivalent of the Letter of Credit Obligations incurred on behalf of the Domestic Borrowers, in the aggregate, exceed the Domestic Borrowing Base, the

Domestic Borrowers shall immediately repay such outstanding Revolving Credit Advances and Swing Line Advances to the extent required to eliminate such excess. If any such excess remains after repayment in full of such outstanding Revolving Credit Advances and Swing Line Advances, the Domestic Borrowers shall provide cash collateral for such Letter of Credit Obligations in the manner set forth in Annex B to the extent of such remaining excess. If at any time the Dollar Equivalent of the aggregate outstanding balance of the Revolving Credit Advances and Swing Line Advances outstanding to the Foreign Borrowers and the Dollar Equivalent of the Letter of Credit Obligations incurred on behalf of the Foreign Borrowers, in the aggregate, exceed the Dollar Equivalent of the Foreign Borrowing Base, the Foreign Borrowers shall immediately repay such outstanding Revolving Credit Advances and Swing Line Advances to the extent required to eliminate such excess. If any such excess remains after repayment in full of the aggregate outstanding principal balance of such Revolving Credit Advances and Swing Line Advances, the Foreign Borrowers shall, at the Administrative Agent’s request, provide cash collateral for such Letter of Credit Obligations in the manner set forth in Annex B to the extent of such remaining excess. Notwithstanding the foregoing, any Overadvance made pursuant to Section 1.1(a)(iii) shall be repaid in accordance with Section 1.1(a)(iii).

(iii) Subject to Section 1.3(c), within three (3) Business Days after receipt by any Sotheby Entity of any cash proceeds of any asset disposition, the applicable Borrower (which is the Borrower that received such cash proceeds or, if such cash proceeds are received by a Sotheby Entity other than a Borrower, which is the Borrower that is the most direct holder of Stock of such Sotheby Entity) shall prepay the Obligations (and cash collateralize the Letter of Credit Obligations, as applicable) in an aggregate amount equal to the Ratable Share of such proceeds, after the following amounts are deducted from the aggregate amount of all such proceeds: (1) commissions and other reasonable and customary transaction costs, fees and expenses properly attributable to such transaction and payable by Sotheby Entities in connection therewith (in each case, paid to non-Affiliates), (2) transfer taxes, (3) amounts payable to holders of senior Liens on such asset (to the extent such Liens constitute Permitted Encumbrances hereunder), if any, and (4) an appropriate reserve for income taxes in accordance with GAAP in connection therewith. Any such prepayment of the Obligations (and cash collateralization of Letter of Credit Obligations) shall be applied in accordance with Section 1.3(d) or (e), as applicable. The following shall not be subject to mandatory prepayment under this clause (iii): (1) proceeds of dispositions permitted under Section 6.8 and (2) asset disposition proceeds with respect to Equipment or Fixtures that are reinvested in Equipment or Fixtures within one hundred and eighty (180) days of receipt thereof; provided, that the Borrower Representative notifies the Administrative Agent of its intent to reinvest at the time such proceeds are received and when such reinvestment occurs.

(iv) Subject to Section 1.3(c), if any Sotheby Entity issues Stock to any entity other than another Sotheby Entity, no later than the fifth (5th) Business Day following the date of receipt of any cash proceeds thereof, the applicable Borrower (which is the Borrower that received such cash proceeds or, if such cash proceeds are received by a Sotheby Entity other than a Borrower, which is the Borrower that is the most direct holder of Stock of such Sotheby Entity) shall prepay the Obligations (and cash collateralize Letter of Credit Obligations, as applicable) in an aggregate amount equal to the Ratable Share of all such proceeds, after the following amounts are deducted from the aggregate amount of all such proceeds: (1) underwriting discounts, (2) commissions and (3) other reasonable costs paid to non-Affiliates in connection therewith. Any

such prepayment of the Obligations (and cash collateralization of Letter of Credit Obligations) shall be applied in accordance with Section 1.3(d) or (e), as applicable. The following shall not be subject to prepayment under this clause (iv): (1) proceeds of Stock issuances of Parent, (2) proceeds of Stock issuances to employees of any Sotheby Entity and (3) proceeds of Stock issuances up to the Dollar Equivalent of $10,000,000 in the aggregate for any Fiscal Year.

(c) Adjustments to Mandatory Prepayment Amounts. The Borrowers shall be required to make any prepayment otherwise payable pursuant to Sections 1.3(b)(iii), 1.3(b)(iv) or 5.4 only to the extent that the amount of such prepayment exceeds (i) in the case of the Domestic Borrowers, the Domestic Borrowing Availability as of the date of such required prepayment or (ii) in the case of the Foreign Borrowers, the Foreign Borrowing Availability as of the date of such required prepayment, in each case as set forth in a Borrowing Base Certificate most recently delivered as of the date of such required prepayment. In addition, if, after giving effect to the previous sentence, any Foreign Borrower shall be required to make a prepayment pursuant to Sections 1.3(b)(iii), 1.3(b)(iv) or 5.4 in excess of the outstanding principal balance of the Revolving Credit Advances and Swing Line Advances outstanding to the Foreign Borrowers and the Letter of Credit Obligations incurred on behalf of the Foreign Borrowers, in the aggregate, as of such date, then the Domestic Borrowers shall be jointly and severally liable to make a prepayment of the Loans (and cash collateralize the Letter of Credit Obligations) (in addition to any prepayment made by such Foreign Borrower pursuant to Sections 1.3(b)(iii), 1.3(b)(iv) or 5.4, as applicable) in an amount equal to (i) the amount of such excess minus (ii) the Domestic Borrowing Availability as of the date of such required prepayment as set forth in a Borrowing Base Certificate delivered to the Administrative Agent.

(d) Application of Mandatory Prepayments by Domestic Borrowers. Subject to the terms of the Collateral Documents, any prepayments made by any Domestic Borrower pursuant to Sections 1.3(b)(iii) or (iv) or Section 5.4 shall be applied as follows: first, to Fees, reimbursable expenses, indemnities and other amounts owing to the Agents which are then due and payable pursuant to any of the Loan Documents; second, to interest then due and payable on Swing Line Advances outstanding to the Domestic Borrowers; third, to the principal balance of Swing Line Advances outstanding to the Domestic Borrowers until the same have been paid in full; fourth, to interest then due and payable on Revolving Credit Advances outstanding to the Domestic Borrowers; fifth, to the principal balance of Revolving Credit Advances outstanding to the Domestic Borrowers until the same have been paid in full; sixth, to any Letter of Credit Obligations incurred on behalf of the Domestic Borrowers to provide cash collateral therefor in the manner set forth in Annex B, until all such Letter of Credit Obligations have been fully cash collateralized in the manner set forth in Annex B; seventh, to any other Obligations owing by the Domestic Credit Parties; eighth, to interest then due and payable on Swing Line Advances outstanding to the Foreign Borrowers; ninth, to the principal balance of Swing Line Advances outstanding to the Foreign Borrowers until the same have been paid in full; tenth, to interest then due and payable on the Revolving Credit Advances outstanding to the Foreign Borrowers; eleventh, to the principal balance of the Revolving Credit Advances outstanding to the Foreign Borrowers until the same have been paid in full; twelfth, to any Letter of Credit Obligations incurred on behalf of the Foreign Borrowers to provide cash collateral therefor in the manner set forth in Annex B, until all such Letter of Credit Obligations have been fully cash collateralized in the manner set forth in Annex B; and, last, to any other Obligations owing by the Foreign Credit

Parties. The Commitment shall not be permanently reduced by the amount of any such prepayments.

(e) Application of Mandatory Prepayments by Foreign Borrowers. Subject to the terms of the Collateral Documents, any prepayments made by any Foreign Borrower pursuant to Sections 1.3(b)(iii) or (iv) or Section 5.4 above shall be applied as follows: first, to Fees, reimbursable expenses, indemnities and other amounts owing to the Agents which are then due and payable pursuant to any of the Loan Documents in respect of the Revolving Loans made to the Foreign Borrowers; second, to interest then due and payable on Swing Line Advances outstanding to the Foreign Borrowers; third, to the principal balance of Swing Line Advances outstanding to the Foreign Borrowers until the same have been paid in full; fourth, to interest then due and payable on Revolving Credit Advances outstanding to the Foreign Borrowers; fifth, to the principal balance of Revolving Credit Advances outstanding to the Foreign Borrowers until the same have been paid in full; sixth, to any Letter of Credit Obligations incurred on behalf of the Foreign Borrowers to provide cash collateral therefor in the manner set forth in Annex B, until all such Letter of Credit Obligations have been fully cash collateralized in the manner set forth in Annex B; and, last, to any other Obligations owing by the Foreign Credit Parties. Neither the Commitment nor the Foreign Currency Subfacility Limit shall be permanently reduced by the amount of any such prepayments.

(f) No Implied Consent. Nothing in this Section 1.3 shall be construed to constitute any Agent’s or any Lender’s consent to any transaction that is not permitted by other provisions of this Agreement or the other Loan Documents.

(g) Application to Revolving Credit Advances. Any prepayment made on any outstanding Revolving Credit Advances pursuant to Sections 1.1(a)(i), 1.3(b) or 5.4 shall be applied as follows: first, to such Revolving Credit Advances that are Index Rate Loans; and second, to such Revolving Credit Advances that are LIBOR Loans, in the order of the LIBOR Loans with the shortest LIBOR Periods to the LIBOR Loans with the longest LIBOR Periods. Application to specific Advances pursuant to this Section 1.3(g) shall be subject to the calculation of the indemnities, if any, owing to the Lenders pursuant to Section 1.14(b).

1.4	Use of Proceeds.

Borrowers shall utilize the proceeds of the Loans solely for the financing of Borrowers’ and their Subsidiaries’ working capital and other general corporate needs.

1.5	Interest and Applicable Margins.

(a) Borrowers shall pay interest to the Administrative Agent, for the ratable benefit of Lenders and the Fronting Lender in accordance with the various Loans being made by each Lender and the Fronting Lender, in arrears on each applicable Interest Payment Date, at the following rates: (i) with respect to the Dollar Revolving Credit Advances, the Dollar Index Rate plus the Applicable Dollar Revolver Index Margin per annum or, at the election of Borrower Representative, the applicable Dollar LIBOR Rate plus the Applicable Dollar Revolver LIBOR Margin per annum, (ii) with respect to the Foreign Currency Revolving Credit Advances denominated in Sterling, the applicable Sterling LIBOR Rate plus the Applicable Sterling

Revolver LIBOR Margin per annum, (iii) with respect to the Foreign Currency Revolving Credit Advances denominated in Euro, the applicable Euro LIBOR Rate plus the Applicable Euro Revolver LIBOR Margin per annum, (iv) with respect to the Foreign Currency Revolving Credit Advances denominated in Hong Kong Dollars, the Hong Kong Dollars LIBOR Rate plus the Applicable Hong Kong Dollars Revolver LIBOR Margin per annum, (v) with respect to Swing Line Advances denominated in Dollars, the Dollar Index Rate plus the Applicable Dollar Revolver Index Margin per annum, (vi) with respect to Swing Line Advances denominated in Sterling, the Sterling Index Rate plus the Applicable Sterling Revolver Index Margin per annum, (vii) with respect to Swing Line Advances denominated in Euro, the Euro Index Rate plus the Applicable Euro Revolver Index Margin per annum and (viii) with respect to Swing Line Advances denominated in Hong Kong Dollars, the Hong Kong Dollars Index Rate plus the Applicable Hong Kong Dollars Revolver Index Margin per annum.

As of the Closing Date, the Applicable Margins are as follows:

	Applicable Dollar Revolver Index Margin	0.75%
	Applicable Dollar Revolver LIBOR Margin	1.75%
	Applicable Sterling Revolver Index Margin	0.75%
	Applicable Sterling Revolver LIBOR Margin	1.75%
	Applicable Euro Revolver Index Margin	0.75%
	Applicable Euro Revolver LIBOR Margin	1.75%
	Applicable Hong Kong Dollars Revolver Index Margin	0.75%
	Applicable Hong Kong Dollars Revolver LIBOR Margin	1.75%
	Applicable L/C Margin	1.75%
	Applicable Unused Line Fee Margin	0.500%

The Applicable Margins shall be adjusted by reference to the following grids:

	If the Usage for such Business Day is:	Level of Applicable Margins:
	≤ 25%	Level I
	>25% but ≤ 50%	Level II
	>50% but ≤ 75%	Level III
	>75%	▇▇▇▇▇ ▇▇

		▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
		▇▇▇▇▇ ▇		▇▇▇▇▇ ▇▇		▇▇▇▇▇ ▇▇▇		Level IV
	Applicable Dollar Revolver Index Margin	0.75%		1.00%		1.25%		1.50%
	Applicable Dollar Revolver LIBOR Margin	1.75%		2.00%		2.25%		2.50%
	Applicable Sterling Revolver Index Margin	0.75%		1.00%		1.25%		1.50%
	Applicable Sterling Revolver LIBOR Margin	1.75%		2.00%		2.25%		2.50%
	Applicable Euro Revolver Index Margin	0.75%		1.00%		1.25%		1.50%
	Applicable Euro Revolver LIBOR Margin	1.75%		2.00%		2.25%		2.50%
	Applicable Hong Kong Dollars Revolver Index Margin	0.75%		1.00%		1.25%		1.50%
	Applicable Hong Kong Dollars Revolver LIBOR Margin	1.75%		2.00%		2.25%		2.50%
	Applicable L/C Margin	1.75%		2.00%		2.25%		2.50%

If the Usage for such Business Day is:			<33%		>33% but ≤66%		>66%
Applicable Unused Line Fee Margin			0.500%		0.375%		0.250%

Adjustments in the Applicable Margins shall be implemented each Business Day. Notwithstanding the foregoing, from and after the occurrence of an Event of Default and until the first Business Day following the cure or waiver thereof, no reduction in the Applicable Margins shall be implemented.

(b) If any payment on any Loan becomes due and payable on a day other than a Business Day, the maturity thereof will be extended to the next succeeding Business Day (except as set forth in the definition of LIBOR Period) and, with respect to payments of principal, interest thereon shall be payable at the then applicable rate during such extension.

(c) All computations of Fees calculated on a per annum basis and interest on all Loans shall be made by the Administrative Agent on the basis of a 360-day year, in each case for the actual number of days occurring in the period for which such interest and Fees are

payable. The Dollar Index Rate, the Sterling Index Rate, the Euro Index Rate and the Hong Kong Dollars Index Rate are floating rates determined for each day. Each determination by the Administrative Agent of an interest rate and Fees hereunder shall be presumptive evidence of the correctness of such rates and Fees.

(d) So long as an Event of Default has occurred and is continuing under Section 8.1(a), (g) or (h), or so long as any other Event of Default has occurred and is continuing and the Administrative Agent shall have elected (or, by written request to the Administrative Agent, the Requisite Lenders shall have elected), which election in either case shall be confirmed by written notice from the Administrative Agent to Borrower Representative, the interest rates applicable to the Loans and the Letter of Credit Fees shall be increased by two percentage points (2%) per annum above the rates of interest or the rate of such Fees otherwise applicable hereunder (the “Default Rate”), and all outstanding Obligations shall bear interest at the Default Rate applicable to such Obligations. Interest and Letter of Credit Fees at the Default Rate shall accrue from the initial date of such Event of Default until that Event of Default is cured or waived and shall be payable upon demand.

(e) Subject to the conditions precedent set forth in Section 2.2, Borrower Representative shall have the option to (i) request that any Revolving Credit Advance denominated in Dollars be made as a LIBOR Loan, (ii) convert at any time all or any portion of the outstanding Revolving Loan denominated in Dollars from Index Rate Loans to LIBOR Loans, (iii) convert any LIBOR Loan denominated in Dollars to an Index Rate Loan, subject to payment of LIBOR breakage costs in accordance with Section 1.14(b) if such conversion is made prior to the expiration of the LIBOR Period applicable thereto, or (iv) continue all or any portion of the outstanding Revolving Loan as a LIBOR Loan upon the expiration of the applicable LIBOR Period and the succeeding LIBOR Period of that continued portion of the outstanding Revolving Loan shall commence on the first day after the last day of the LIBOR Period of the portion of the outstanding Revolving Loan to be continued. Any portion of the outstanding Revolving Loan to be made or continued as, or converted into, a LIBOR Loan must be in a minimum amount of (i) if denominated in Dollars, $5,000,000 or an integral multiple of $1,000,000 in excess of such amount, (ii) if denominated in Sterling, £3,000,000 or an integral multiple of £500,000 in excess of such amount, (iii) if denominated in Euro, €3,000,000 or an integral multiple of €500,000 in excess of such amount or (iv) if denominated in Hong Kong Dollars, HK$40,000,000 or an integral multiple of HK$8,000,000 in excess of such amount. Any such election must be made by 11:00 a.m. (New York time) on the third Business Day prior to (1) the date of any proposed Revolving Credit Advance which is to be made as a LIBOR Loan, (2) the end of each LIBOR Period with respect to any LIBOR Loans to be continued as such, or (3) the date on which Borrower Representative wishes to convert any Index Rate Loan to a LIBOR Loan for a LIBOR Period designated by Borrower Representative in such election. If no election is received with respect to a LIBOR Loan by 11:00 a.m. (New York time) on the third Business Day prior to the end of the LIBOR Period with respect thereto (or if a Default or an Event of Default has occurred and is continuing or if the additional conditions precedent set forth in Section 2.2 shall not have been satisfied), (i) if such LIBOR Loan is denominated in Dollars, such LIBOR Loan shall be converted to an Index Rate Loan at the end of its LIBOR Period and (ii) if such LIBOR Loan is denominated in a Foreign Currency, such LIBOR Loan shall be continued as a LIBOR Loan having a LIBOR Period of one month. Borrower Representative must make such election by notice to the Administrative Agent in writing, by

telecopy or overnight courier, or Electronic Transmission. In the case of any conversion or continuation, such election must be made pursuant to a notice (a “Notice of Conversion/Continuation”) delivered in writing or by Electronic Transmission in the form of Exhibit 1.5(e). Notwithstanding anything in this Section 1.5(e) or Agreement to the contrary, conversions and continuations of Index Rate Loans and LIBOR Loans hereunder shall not result in refinancings or repayments of such portions of the outstanding Revolving Loan, but only repricings of such continuously outstanding portions of the outstanding Revolving Loan.

(f) Notwithstanding anything to the contrary set forth in this Section 1.5, if a court of competent jurisdiction determines in a final order that the rate of interest payable hereunder exceeds the highest rate of interest permissible under law (the “Maximum Lawful Rate”), then so long as the Maximum Lawful Rate would be so exceeded, the rate of interest payable hereunder shall be equal to the Maximum Lawful Rate; provided, however, that if at any time thereafter the rate of interest payable hereunder is less than the Maximum Lawful Rate, Borrowers shall continue to pay interest hereunder at the Maximum Lawful Rate until such time as the total interest received by the Administrative Agent, on behalf of Lenders, is equal to the total interest that would have been received had the interest rate payable hereunder been (but for the operation of this paragraph) the interest rate payable since the Closing Date as otherwise provided in this Agreement. In no event shall the total interest received by any Lender pursuant to the terms hereof exceed the amount that such Lender could lawfully have received had the interest due hereunder been calculated for the full term hereof at the Maximum Lawful Rate.

1.6	Eligible Art Loans.

All of the Art Loans owned by each Borrower and reflected in the most recent Borrowing Base Certificate delivered by the Borrower Representative to the Administrative Agent shall be “Eligible Art Loans” for purposes of this Agreement, except any Art Loans to which any of the exclusionary criteria set forth below applies. The Administrative Agent shall have the right to establish, modify or eliminate Reserves against Eligible Art Loans from time to time in its sole reasonable credit judgment. In addition, the Administrative Agent reserves the right, at any time and from time to time after the Closing Date, to adjust any of the criteria set forth below and to establish new criteria, and to adjust advance rates with respect to Eligible Art Loans, in its reasonable credit judgment, reflecting changes in the collectibility or realization values of such Art Loans arising or discovered by the Administrative Agent after the Closing Date subject to the approval of Supermajority Lenders in the case of adjustments or new criteria or changes in advance rates which have the effect of making more credit available; provided that, (i) for purposes of clarity, the Administrative Agent will not be required at any time to obtain any approval from any Lenders or any other Person(s) for the establishment, modification or elimination of any Reserves against Eligible Art Loans and (ii) any decreases to advance rates with respect to Eligible Art Loans made after the Closing Date shall only apply to Art Loans added to any Borrowing Base after the date of such decrease in the advance rates. Eligible Art Loans shall not include any Art Loan of any Borrower:

(a) with respect to which (i) such Borrower shall not have conducted (x) appropriate UCC, tax lien and judgment searches (or applicable equivalent) against the applicable Art Loan Debtor or (y) in the case of any Art Loan Debtor located in the United Kingdom or Hong Kong, appropriate bankruptcy, winding up and company searches against the

applicable Art Loan Debtor or (ii) the results of such searches shall have indicated any material risk with respect to the applicable Art Loan Debtor or the Works of Art securing repayment of such Art Loan;

(b) with respect to which (i) such Art Loan and the related security interest are not governed by a loan and security agreement reasonably acceptable to the Administrative Agent in form and substance, or (ii) any material terms of the related loan and security agreement and/or any other related documentation are not binding and enforceable;

(c) with respect to which any payment under the related loan agreement (or any other Art Loan outstanding to such related Art Loan Debtor) has been deemed by such Borrower to be non-accrual;

(d) that is subject to any litigation challenging the validity or enforceability of such Art Loan or any related documentation, unless (i) such Borrower has notified the Administrative Agent of such litigation, and (ii) the Administrative Agent has determined in its reasonable judgment, pursuant to a written notice to such Borrower (not to be unreasonably withheld or delayed), that such litigation does not constitute good faith litigation;

(e) (i) that is not denominated in Dollars, Canadian Dollars, Hong Kong Dollars, Sterling, Euros, Swiss Francs or an Alternative Art Loan Currency, (ii) if such Art Loan is denominated in Hong Kong Dollars and owned by a Domestic Borrower or U.K. Borrower, unless the Administrative Agent shall have otherwise agreed, a Credit Party (if such Art Loan is owned by a U.K. Borrower) or a Domestic Credit Party (if such Art Loan is owned by a Domestic Borrower) shall have not entered into a Rate Management Transaction reasonably acceptable to the Administrative Agent (x) having a notional amount substantially equal to the outstanding principal balance of such Art Loan at all times until the maturity of such Art Loan and (y) directly mitigating the risk associated with changes in the exchange rate between Hong Kong Dollars and Dollars (in the case of any Art Loan owned by a Domestic Borrower) or Sterling (in the case of any Art Loan owned by a U.K. Borrower) at all times until the maturity of such Art Loan or (iii) if such Art Loan is denominated in an Alternative Art Loan Currency, unless the Administrative Agent shall have otherwise agreed, a Credit Party (in the case of any Foreign Borrower) or a Domestic Credit Party (in the case of any Domestic Borrower) shall have not entered into a Rate Management Transaction reasonably acceptable to the Administrative Agent (x) having a notional amount substantially equal to the outstanding principal balance of such Art Loan at all times until the maturity of such Art Loan and (y) directly mitigating the risk associated with changes in the exchange rate between the currency in which such Art Loan is denominated and Dollars (in the case of any Art Loan owned by a Domestic Borrower) or Sterling (in the case of any Art Loan owned by a Foreign Borrower) at all times until the maturity of such Art Loan;

(f) that was not generated in the ordinary course of the applicable Borrower’s business;

(g) unless the Administrative Agent shall have otherwise agreed, that by its terms is not due and payable within 18 months; provided that, Art Loans that by their terms are due and payable after 18 months but within 24 months shall not be excluded as “Eligible Art

Loans” pursuant to this clause to the extent the portion of the outstanding principal balance of such Art Loans included in any Borrowing Base, collectively with the portion of the outstanding principal balance of such “Art Loans” included in any “Borrowing Base” under the SFS Revolving Credit Agreement, does not exceed $150,000,000 in the aggregate;

(h) to the extent that any defense, counterclaim, setoff or dispute (other than any dispute described in clause (d) above or in clauses (h) or (i) of the definition of “Eligible Art Loan Collateral”) is asserted in writing (and reasonably determined by such Borrower not to be frivolous) as to repayment by the relevant Art Loan Debtor of such Art Loan or as to any failure by any Sotheby Entity to fund any unfunded commitment of such Sotheby Entity to make future Art Loans to the relevant Art Loan Debtor, unless (i) such Borrower has notified the Administrative Agent of such defense, counterclaim, setoff or dispute, and (ii) the Administrative Agent has determined in its reasonable judgment, pursuant to a written notice to such Borrower (not to be unreasonably withheld or delayed), that such defense, counterclaim, setoff or dispute is not asserted in good faith;

(i) that (i) is not subject to a first priority lien in favor of the Collateral Agent, on behalf of the Secured Parties, or (ii) is subject to any Lien of any Person other than the Collateral Agent, except Permitted Encumbrances;

(j) with respect to which the Art Loan Debtor is a director, officer, other employee or Affiliate of any Sotheby Entity, unless the Administrative Agent shall have determined, in its sole discretion, that such Art Loan shall constitute an Eligible Art Loan notwithstanding the provisions of this clause (j);

(k) unless the Administrative Agent shall have otherwise agreed in its reasonable credit judgment, that is the obligation of an Art Loan Debtor that is the United States government or a political subdivision thereof, or any state, county or municipality or department, agency or instrumentality thereof;

(l) that is not secured by Eligible Art Loan Collateral or to the extent by which the outstanding principal balance of such Art Loan exceeds sixty percent (60%) of the aggregate Estimated Value of the Works of Art securing repayment of such Art Loan that constitute Eligible Art Loan Collateral;

(m) in the case of an Art Loan Debtor that is not an individual, such Borrower has not obtained confirmation of authorization of the incurrence of such Art Loan by such Person and the individuals executing documents on its behalf;

(n) with respect to which (i) a petition is filed by or against the related Art Loan Debtor under any bankruptcy law or any other federal, state or foreign (including any provincial) receivership, insolvency relief or other law or laws for the relief of debtors or (ii) the related Art Loan Debtor makes a general assignment for the benefit of creditors;

(o) to the extent any Sotheby Entity is liable for goods sold or services rendered by the applicable Art Loan Debtor to such Sotheby Entity, but only to the extent of the potential offset; provided that, without duplication of amounts described in the proviso of Section 1.8(m) or described in the proviso of Section 1.6(o) of the SFS Revolving Credit

Agreement, if such potential offset arises from amounts payable by such Borrower to such Art Loan Debtor from any receivable then due and payable to such Borrower, as agent for such Art Loan Debtor, by a buyer of a Work of Art (other than the Work of Art securing any Art Loan) that was sold on consignment by such Borrower, as consignee, on behalf of such Art Loan Debtor, in its capacity as consignor, such potential offset shall be reduced by the amount of such receivable (net of any commissions, buyer’s premium and reimbursable expenses payable to any Sotheby Entity for such sale);

(p) with respect to which (i) any of the documentation evidencing such Art Loan is not in the possession of such Borrower or any Agent or (ii) any of the representations or warranties in this Agreement and the other Loan Documents pertaining to such Art Loan is untrue in any material respect (or, in the case of any representation or warranty already qualified by materiality, in any respect);

(q) to the extent such Art Loan exceeds any credit limit with respect to any Art Loan Debtor established by the Administrative Agent, in its reasonable credit judgment, taking into account the nature and value of the Works of Art securing such Art Loan and after consultation with the Borrower Representative;

(r) with respect to which the initial outstanding principal amount, if owned by a Domestic Borrower, is less than $100,000; or

(s) that is included in any “Borrowing Base” under the SFS Revolving Credit Agreement.

1.7	Eligible Art Inventory.

All of the Art Inventory owned by the Borrowers and reflected in the most recent Borrowing Base Certificate delivered by each Borrower to the Administrative Agent shall be “Eligible Art Inventory” for purposes of this Agreement, except any Art Inventory to which any of the exclusionary criteria set forth below applies. The Administrative Agent shall have the right to establish, modify or eliminate Reserves against Eligible Art Inventory from time to time in its sole reasonable credit judgment. In addition, the Administrative Agent reserves the right, at any time and from time to time after the Closing Date, to adjust of the criteria set forth below and to establish new criteria and to adjust advance rates with respect to Eligible Art Inventory, in its reasonable credit judgment reflecting changes in the salability or realization values of Art Inventory arising or discovered by the Administrative Agent after the Closing Date, subject to the approval of Supermajority Lenders in the case of adjustments or new criteria or changes in advance rates which have the effect of making more credit available; provided that, (i) for purposes of clarity, the Administrative Agent will not be required at any time to obtain any approval from any Lenders or any other Person(s) for the establishment, modification or elimination of any Reserves against Eligible Art Inventory and (ii) any decreases to advance rates with respect to Eligible Art Inventory made after the Closing Date shall only apply to Art Inventory added to any Borrowing Base after the date of such decrease in the advance rates. Eligible Art Inventory shall not include any Art Inventory of any Borrower that:

(a) is owned by such Borrower as part of a joint venture or profit/loss sharing arrangement or otherwise is not owned solely by such Borrower, unless (i) the Administrative Agent shall have otherwise agreed, or (ii) such Borrower has ultimate control of the disposition of such Art Inventory, in which case such Art Inventory shall be eligible to constitute Eligible Art Inventory to the extent of such Borrower’s ownership interest therein;

(b) other than as permitted by clause (a) above, is not owned by such Borrower free and clear of all Liens and rights of any other Person, except the Liens in favor of the Collateral Agent, on behalf of the Secured Parties, and Permitted Encumbrances described in clause (e) of the definition thereof (subject to Reserves satisfactory to the Administrative Agent);

(c) (i) is not (x) located in a Permitted Inventory Country or (y) in transport between such countries or (ii) is located in a Permitted Inventory Country and such Borrower shall not have taken each action reasonably required by the Collateral Agent with respect to such Work of Art located in such Permitted Inventory Country in order to protect the interests of the Agents therein under the laws of such Permitted Inventory Country;

(d) is not held by such Borrower (i) at a location owned by a Sotheby Entity, or (ii) unless Reserves satisfactory to the Administrative Agent have been established (A) at a location in which a Sotheby Entity has obtained a leasehold interest with respect to which, unless otherwise agreed by the Administrative Agent, the lessor has executed a landlord waiver, in form and substance reasonably acceptable to the Administrative Agent, or (B) at a warehouse, storage facility or other third-party location (including, without limitation, the Geneva free port) with respect to which, unless otherwise agreed by the Administrative Agent, such third party has executed a bailee letter or similar agreement in form and substance reasonably acceptable to the Administrative Agent;

(e) is subject to any litigation challenging the rights of such Borrower in such Art Inventory, unless (i) such Borrower has notified the Administrative Agent of such litigation, and (ii) the Administrative Agent has determined in its reasonable judgment, pursuant to a written notice to such Borrower (not to be unreasonably withheld or delayed), that such litigation does not constitute good faith litigation;

(f) is placed on consignment with any Person, unless (i) such consignment constitutes a Permitted Consignment with respect to such Art Inventory, or (ii)(x) such Borrower has notified the Administrative Agent of such consignment and (y) the Administrative Agent has determined in its reasonable judgment, pursuant to a written notice to such Borrower (not to be unreasonably withheld or delayed), that such Borrower has taken all actions reasonably required by the Administrative Agent with respect to such Art Inventory in order to protect the interests of the Agents therein under all applicable laws;

(g) is not subject to a first priority lien in favor of the Collateral Agent on behalf of the Secured Parties, subject to Permitted Encumbrances described in clause (e) of the definition thereof (subject to Reserves satisfactory to the Administrative Agent);

(h) if the value of such Art Inventory exceeds $250,000, has not been the subject of a search by such Borrower in the Art Loss Register; or

(i) breaches any of the representations or warranties pertaining to Art Inventory set forth in the Loan Documents.

1.8	Eligible Extended Term Art Receivables.

All of the Extended Term Art Receivables owned by each Borrower and reflected in the most recent Borrowing Base Certificate delivered by the Borrower Representative to the Administrative Agent shall be “Eligible Extended Term Art Receivables” for purposes of this Agreement, except any Extended Term Art Receivables to which any of the exclusionary criteria set forth below applies. The Administrative Agent shall have the right to establish, modify or eliminate Reserves against Eligible Extended Term Art Receivables from time to time in its sole reasonable credit judgment. In addition, the Administrative Agent reserves the right, at any time and from time to time after the Closing Date, to adjust any of the criteria set forth below and to establish new criteria, and to adjust advance rates with respect to Eligible Extended Term Art Receivables, in its reasonable credit judgment, reflecting changes in the collectibility or realization values of such Extended Term Art Receivables arising or discovered by the Administrative Agent after the Closing Date subject to the approval of Supermajority Lenders in the case of adjustments or new criteria or changes in advance rates which have the effect of making more credit available; provided that, (i) for purposes of clarity, the Administrative Agent will not be required at any time to obtain any approval from any Lenders or any other Person(s) for the establishment, modification or elimination of any Reserves against Eligible Extended Term Art Receivables and (ii) any decreases to advance rates with respect to Eligible Extended Term Art Receivables made after the Closing Date shall only apply to Extended Term Art Receivables added to any Borrowing Base after the date of such decrease in the advance rates. Eligible Extended Term Art Receivables shall not include any Extended Term Art Receivable of any Borrower:

(a) with respect to which (i) such Extended Term Art Receivable and the related consignment are not governed by Extended Term Art Documentation reasonably acceptable to the Administrative Agent in form and substance, (ii) the related Extended Term Art Documentation is not governed under the laws of (x) the State of New York, (y) England and Wales, or (z) Hong Kong, (iii) any material terms of the related Extended Term Art Documentation and/or any other related documentation are not binding and enforceable or (iv) the related Extended Term Art Documentation or the related auction giving rise to such Extended Term Art Receivable shall not comply with the Extended Term Auction Procedural Requirements;

(b) with respect to which any payment under any Extended Term Art Documentation (or any other Extended Term Art Receivable which has the same Extended Term Art Debtor) has been deemed by such Borrower to be non-accrual;

(c) that is subject to any litigation challenging the validity or enforceability of such Extended Term Art Receivable, the related Extended Term Art Documentation or any other related documentation, unless (i) such Borrower has notified the Administrative Agent of such litigation, and (ii) the Administrative Agent has determined in its reasonable judgment, pursuant to a written notice to such Borrower (not to be unreasonably withheld or delayed), that such litigation does not constitute good faith litigation;

(d) that is payable in any currency other than Dollars, Hong Kong Dollars, Sterling or Euros;

(e) that was not generated in the ordinary course of the applicable Borrower’s business;

(f) unless the Administrative Agent shall have otherwise agreed, that (i) is past due or (ii) by its terms is not due and payable within one hundred twenty (120) calendar days following the date on which the auction giving rise to such Extended Term Art Receivable occurred;

(g) to the extent that any defense, counterclaim, setoff or dispute (other than any dispute described in clause (c) above or in clauses (i) or (j) of the definition of “Eligible Extended Term Art Collateral”) is asserted in writing (and reasonably determined by such Borrower not to be frivolous) as to repayment by the relevant Extended Term Art Debtor of such Extended Term Art Receivable or of any other Extended Term Art Receivable owed by such Extended Term Art Debtor, unless (i) such Borrower has notified the Administrative Agent of such defense, counterclaim, setoff or dispute, and (ii) the Administrative Agent has determined in its reasonable judgment, pursuant to a written notice to such Borrower (not to be unreasonably withheld or delayed), that such defense, counterclaim, setoff or dispute is not asserted in good faith;

(h) that (i) is not subject to a first priority lien in favor of the Collateral Agent, on behalf of the Secured Parties, or (ii) is subject to any Lien of any Person other than the Collateral Agent, except Permitted Encumbrances;

(i) with respect to which the Extended Term Art Debtor is a director, officer, other employee or Affiliate of any Sotheby Entity, unless the Administrative Agent shall have determined, in its sole discretion, that such Extended Term Art Receivable shall constitute an Eligible Extended Term Art Receivable notwithstanding the provisions of this clause (j);

(j) unless the Administrative Agent shall have otherwise agreed in its reasonable credit judgment, that is the obligation of an Extended Term Art Debtor that is the United States government or a political subdivision thereof, or any state, county or municipality or department, agency or instrumentality thereof;

(k) for which the underlying Work of Art does not constitute Eligible Extended Term Art Collateral;

(l) with respect to which (i) a petition is filed by or against the related Extended Term Art Debtor or Extended Term Art Consignor under any bankruptcy law or any other federal, state or foreign (including any provincial) receivership, insolvency relief or other law or laws for the relief of debtors or (ii) the related Extended Term Art Debtor or Extended Term Art Consignor makes a general assignment for the benefit of creditors;

(m) to the extent any Sotheby Entity is liable for goods sold or services rendered by the applicable Extended Term Art Debtor to such Sotheby Entity (or, if the related Extended Term Art Documentation is governed under the laws of the State of New York, the Extended Term Art Consignor), but only to the extent of the potential offset; provided that, without duplication of the amount of any receivable described in the proviso of Section 1.6(o) of this Agreement or described in the proviso of Section 1.6(o) of the SFS Revolving Credit

Agreement, if such potential offset arises from amounts payable by such Borrower to such Extended Term Art Debtor or Extended Term Art Consignor, as applicable, from any receivable then due and payable to such Borrower, as agent for such Extended Term Art Debtor or Extended Term Art Consignor, as applicable, by a buyer of a Work of Art (other than the Work of Art securing any Art Loan) that was sold on consignment by such Borrower, as consignee, on behalf of such Extended Term Art Debtor or Extended Term Art Consignor, as applicable, such potential offset shall be reduced by the amount of such receivable (net of any commissions, buyer’s premium and reimbursable expenses payable to any Sotheby Entity for such sale);

(n) with respect to which (i) any of the Extended Term Art Documentation or any other documentation evidencing such Extended Term Art Receivable is not in the possession of such Borrower or any Agent or (ii) any of the representations or warranties in this Agreement and the other Loan Documents pertaining to such Extended Term Art Receivable is untrue in any material respect (or, in the case of any representation or warranty already qualified by materiality, in any respect);

(o) to the extent such Extended Term Art Receivables exceeds any credit limit with respect to any Extended Term Art Debtor established by the Administrative Agent, in its reasonable credit judgment, taking into account the nature and value of the underlying Work of Art and after consultation with the Borrower Representative; or

(p) with respect to which the initial outstanding amount, if owned by a Domestic Borrower, is less than $100,000.

1.9	Cash Management Systems.

On and after the Closing Date, the Credit Parties will maintain until the Termination Date the cash management systems described in Annex C (the “Cash Management Systems”).

1.10

Fees.

(a) Borrowers shall pay to GE Capital an annual collateral monitoring fee equal to $100,000 per year payable on the Closing Date and annually in advance on each anniversary thereof prior to the Termination Date; provided that, (i) the annual collateral monitoring fee payable hereunder shall be reduced on a dollar-for-dollar basis by any portion of the annual collateral monitoring fee paid to GE Capital pursuant to Section 1.10(a) of the SFS Revolving Credit Agreement and (ii) a pro-rated portion of the annual collateral monitoring fee paid by the Borrowers or their Affiliates pursuant to the terms of the Existing Credit Agreement on the most recent anniversary of the “Restatement Effective Date” (as defined in the Existing Credit Agreement) for the period from such anniversary through the Closing Date will be credited to the Borrowers and only the balance of such annual collateral monitoring fee will be due and payable on the Closing Date.

(b) As additional compensation for the Lenders, Borrowers shall pay to the Administrative Agent, for the ratable benefit of the Lenders, in arrears, on the first Business Day of each month prior to the Commitment Termination Date and on the Commitment Termination Date, a Fee for Borrowers’ non use of available funds in an amount in Dollars equal to the

Applicable Unused Line Fee Margin per annum (calculated on the basis of a 360 day year for actual days elapsed) multiplied by the difference between (x) the Maximum Amount (as it may be increased or reduced from time to time) and (y) the average for the period of the daily closing balances of the aggregate Revolving Loan and the Swing Line Loan outstanding during the period for which such Fee is due.

(c) Borrowers shall pay to the Administrative Agent, for the ratable benefit of Lenders, the Letter of Credit Fee and other fees and amounts required by Annex B.

1.11	Receipt of Payments.

Borrowers shall make each payment under this Agreement not later than 2:00 p.m. (New York time) on the day when due in immediately available funds in Dollars, Sterling, Euro or Hong Kong Dollars, as applicable, to the applicable Collection Account. For purposes of computing interest and Fees and determining Borrowing Availability as of any date, all payments shall be deemed received on the Business Day on which immediately available funds therefore are received in the Collection Account prior to 2:00 p.m. New York time. Payments received after 2:00 p.m. New York time on any Business Day or on a day that is not a Business Day shall be deemed to have been received on the following Business Day.

1.12	Application and Allocation of Payments.

(a) So long as no Event of Default has occurred and is continuing, (i) payments matching specific scheduled payments then due shall be applied to those scheduled payments; (ii) voluntary prepayments shall be applied in accordance with the provisions of Section 1.3(a); and (iii) mandatory prepayments shall be applied as set forth in Section 1.3(d) or 1.3(e), as applicable. All payments and prepayments applied to the Revolving Loan shall be applied ratably to the portion thereof held by each Lender as determined by its Pro Rata Share. As to (x) any other payment, (y) all payments made when an Event of Default has occurred and is continuing or following the Commitment Termination Date and (z) all proceeds of Collateral, each Borrower hereby irrevocably waives the right to direct the application of any and all such payments received from or on behalf of such Borrower and proceeds of Collateral, and the Ratable Share of all such payments and proceeds of Collateral shall be applied to amounts then due and payable in the following order, subject to the terms of the Collateral Documents: (1) to Fees and reimbursable expenses of Agents hereunder; (2) to interest on the Swing Line Loan; (3) to principal payments on the Swing Line Loan; (4) to interest on the Revolving Loan; (5) to principal payments on the Revolving Loan and to provide cash collateral for Letter of Credit Obligations in the manner described in Annex B; (6) to all other Obligations owing by the Credit Parties, including expenses of Lenders to the extent reimbursable under Section 11.3; and (7) to amounts owing in respect of Bank Product and Hedging Obligations; provided that, notwithstanding the foregoing, (x) with respect to any Guarantor, no proceeds of any guarantee made by such Guarantor and no proceeds of any Collateral of such Guarantor shall be applied to any Excluded Hedging Obligations of such Guarantor and (y) any payment by a Foreign Credit Party shall be applied only to the Obligations and Bank Product and Hedging Obligations of the Foreign Credit Parties according to the preceding order of priority.

(b) Each Agent is authorized to, and at its sole election may, charge to the Revolving Loan balance on behalf of each Borrower and cause to be paid all Fees, expenses, Charges, costs (including insurance premiums in accordance with Section 5.4(a)) and interest and principal, other than principal of the Revolving Loan, owing by Borrowers under this Agreement or any of the other Loan Documents if and to the extent Borrowers fail to pay promptly any such amounts as and when due, even if the Dollar Equivalent of the amount of such charges would exceed the applicable Borrowing Availability at such time; provided, such action shall not cause the Dollar Equivalent of the aggregate Revolving Loan to exceed the Maximum Amount. At any Agent’s option and to the extent permitted by law, any charges so made shall constitute a Revolving Credit Advance made in the applicable currency and part of the Revolving Loan hereunder.

(c) Notwithstanding any contrary provision herein, if, at the time of the receipt of any prepayment or payment on the Obligations, (i) any Non-Foreign Currency Lender shall have failed to make available to the Fronting Lender any amount required pursuant to Section 9.9(e)(i) upon demand therefor by the Fronting Lender and (ii) the Borrowers shall have failed to repay, pursuant to Section 9.9(e)(iv), the outstanding principal amount of the portion of the Revolving Loan or Letter of Credit Obligation then outstanding to the Fronting Lender in which such Non-Foreign Currency Lender was required to purchase a participation interest, then such prepayment or payment shall be applied first to the portion of the Revolving Loan or Letter of Credit Obligations then outstanding to the Fronting Lender in which such Non-Foreign Currency Lender was required to purchase such participation interest, until the same (together with any interest due and payable thereon) shall have been paid in full.

1.13	Loan Account and Accounting.

The Administrative Agent shall maintain a loan account (the “Loan Account”) on its books to record: all Revolving Credit Advances and Swing Line Advances, all payments made by Borrowers, and all other debits and credits as provided in this Agreement with respect to the Loans or any other Obligations. All entries in the Loan Account shall be made in accordance with the Administrative Agent’s customary accounting practices as in effect from time to time. The balance in the Loan Account, as recorded on the Administrative Agent’s most recent printout or other written statement, shall, absent manifest error, be presumptive evidence of the amounts due and owing to the Agents and Lenders by each Borrower; provided that any failure to so record or any error in so recording shall not limit or otherwise affect any Borrower’s duty to pay the Obligations. The Administrative Agent shall render to Borrower Representative a monthly accounting of transactions with respect to the Loans setting forth the balance of the Loan Account as to each Borrower for the immediately preceding month. Unless Borrower Representative notifies the Administrative Agent in writing of any objection to any such accounting (specifically describing the basis for such objection), within thirty (30) days after the date thereof, each and every such accounting shall be presumptive evidence of all matters reflected therein. Only those items expressly objected to in such notice shall be deemed to be disputed by Borrowers. Notwithstanding any provision herein contained to the contrary, any Lender may elect (which election may be revoked) to dispense with the issuance of Notes to that Lender and may rely on the Loan Account as evidence of the amount of Obligations from time to time owing to it.

1.14	Indemnity.

(a) Each Credit Party shall jointly and severally indemnify and hold harmless each of the Agents, Lenders, the Fronting Lender and their respective Affiliates, and each such Person’s respective officers, directors, employees, attorneys, agents and representatives (each, an “Indemnified Person”), from and against any and all suits, actions, proceedings, claims, damages, losses, liabilities and expenses (including reasonable attorneys’ fees and disbursements and other costs of investigation or defense, including those incurred upon any appeal) that may be instituted or asserted against or incurred by any such Indemnified Person as the result of credit having been extended, suspended or terminated under this Agreement and the other Loan Documents and the administration of such credit, and in connection with or arising out of the transactions contemplated hereunder and thereunder and any actions or failures to act in connection therewith, including any and all Environmental Liabilities and legal costs and expenses arising out of or incurred in connection with disputes between or among any parties to any of the Loan Documents (collectively, “Indemnified Liabilities”); provided, that no such Credit Party shall be liable for any indemnification to an Indemnified Person to the extent that any such suit, action, proceeding, claim, damage, loss, liability or expense results from that Indemnified Person’s gross negligence or willful misconduct as determined in a final, non-appealable judgment by a court of competent jurisdiction. NO INDEMNIFIED PERSON SHALL BE RESPONSIBLE OR LIABLE TO ANY OTHER PARTY TO ANY LOAN DOCUMENT, ANY SUCCESSOR, ASSIGNEE OR THIRD PARTY BENEFICIARY OF SUCH PERSON OR ANY OTHER PERSON ASSERTING CLAIMS DERIVATIVELY THROUGH SUCH PARTY, FOR INDIRECT, PUNITIVE, EXEMPLARY OR CONSEQUENTIAL DAMAGES WHICH MAY BE ALLEGED AS A RESULT OF CREDIT HAVING BEEN EXTENDED, SUSPENDED OR TERMINATED UNDER ANY LOAN DOCUMENT OR AS A RESULT OF ANY OTHER TRANSACTION CONTEMPLATED HEREUNDER OR THEREUNDER. It is understood and agreed that, notwithstanding anything to the contrary set forth in this Section 1.14(a), no Foreign Credit Party shall have any obligation to any Indemnified Person with respect to Indemnified Liabilities relating to Obligations of any Domestic Credit Party.

(b) To induce Lenders to provide the LIBOR Loan option on the terms provided herein, if (i) any LIBOR Loans are repaid in whole or in part prior to the last day of any applicable LIBOR Period (whether that repayment is made pursuant to any provision of this Agreement or any other Loan Document or occurs as a result of acceleration, by operation of law or otherwise); (ii) any Borrower shall default in payment when due of the principal amount of or interest on any LIBOR Loan; (iii) any Borrower shall fail to borrow, continue or convert a LIBOR Loan after it has given notice requesting the same in accordance herewith; (iv) any Borrower shall fail to make any prepayment of a LIBOR Loan after Borrower Representative has given a notice thereof in accordance herewith; or (v) any assignment shall occur pursuant to Section 1.17(d), then Borrowers shall jointly and severally indemnify and hold harmless each Lender from and against all losses, costs and expenses resulting from or arising from any of the foregoing. Such indemnification shall include any loss (excluding loss of margin) or expense arising from the reemployment of funds obtained by it or from fees payable to terminate deposits from which such funds were obtained. For the purpose of calculating amounts payable to a Lender under this subsection, each Lender shall be deemed to have actually funded its portion of the relevant LIBOR Loan (or its participation interest in such LIBOR Loan) through the purchase

of a deposit bearing interest at the Dollar LIBOR Rate, the Sterling LIBOR Rate, the Euro LIBOR Rate or the Hong Kong Dollars LIBOR Rate, as applicable, in an amount equal to the amount of such portion of such LIBOR Loan (or such participation, as applicable) and having a maturity comparable to the relevant LIBOR Period; provided, that each Lender may fund each of its interests in LIBOR Loans (or its participations in LIBOR Loans) in any manner it sees fit, and the foregoing assumption shall be utilized only for the calculation of amounts payable under this subsection. This covenant shall survive the termination of this Agreement and the payment of the Notes and all other amounts payable hereunder. As promptly as practicable under the circumstances, each Lender shall provide Borrower Representative with its written calculation of all amounts payable pursuant to this Section 1.14(b), and such calculation shall be binding on the parties hereto unless Borrower Representative shall object in writing within ten (10) Business Days of receipt thereof, specifying the basis for such objection in detail. It is understood and agreed that, notwithstanding anything to the contrary set forth in this Section 1.14(b), no Foreign Credit Party shall have any obligation to any Lender with regard to any such losses, costs and expenses relating to Obligations of any Domestic Credit Party.

1.15

Access.

Each Credit Party shall, during normal business hours, from time to time upon three (3) Business Days’ prior notice as frequently as the Administrative Agent reasonably determines to be appropriate (except as otherwise provided): (a) provide the Administrative Agent and any of its officers, employees and agents access to its properties, facilities, advisors, officers and employees and to the Collateral (including, without limitation, in order to prepare an appraisal or similar report), (b) permit the Administrative Agent, and any of its officers, employees and agents, to inspect, audit and make extracts from any Sotheby Entity’s books and records, and (c) permit the Administrative Agent, and its officers, employees and agents, not more than two (2) times during any twelve-month period beginning on the date hereof or any anniversary thereof (unless an Event of Default has occurred and is continuing, in which case such limitation shall not apply), to inspect, review, evaluate, and make test verifications and counts of the Collateral of any Credit Party; provided, that (i) the Administrative Agent shall conduct at least one (1) field exam described in the foregoing clause (c) during each twelve-month period and (ii) unless an Event of Default has occurred and is continuing, not more than two such field exams during any twelve-month period shall be at the cost and expense of the Credit Parties. If an Event of Default has occurred and is continuing, each such Credit Party shall provide such access to the Agents and to each Lender at all times and without advance notice. Furthermore, so long as any Event of Default has occurred and is continuing, each Credit Party shall provide the Agents and each Lender with access to their suppliers and customers to the extent such access is within the rights and powers of such Credit Party. Each Credit Party shall make available to each Agent and its counsel reasonably promptly originals or copies of all books and records that such Agent may reasonably request. Each Credit Party shall deliver any document or instrument necessary for any Agent, as it may from time to time reasonably request, to obtain records from any service bureau or other Person that maintains records for such Credit Party, and shall maintain duplicate records or supporting documentation on media, including computer tapes and discs owned by such Credit Party. The Administrative Agent will give Lenders at least five (5) days’ prior written notice of regularly scheduled audits. Representatives of other Lenders may accompany the Administrative Agent’s representatives on regularly scheduled audits at no charge to Borrowers.

1.16

Taxes.

(a) Tax gross-up.

(i) Each Credit Party shall make all payments to be made by it under the Loan Documents without any Tax Deduction, unless a Tax Deduction is required by law.

(ii) The Borrower Representative shall promptly upon becoming aware that a Credit Party must make a Tax Deduction (or that there is any change in the rate or the basis of a Tax Deduction) notify the Administrative Agent accordingly. Similarly, a Lender shall notify the Administrative Agent promptly on becoming so aware in respect of any payment to that Lender pursuant to any Loan Document. If the Administrative Agent receives such notification from a Lender it shall promptly notify the Borrower Representative.

(iii) Subject to paragraph (iv) below, if a Tax Deduction is required by law to be made by any Credit Party, the amount of the payment due from such Credit Party shall be increased to an amount which (after making any Tax Deduction) leaves an amount equal to the payment which would have been due if no Tax Deduction had been required.

(iv) A Credit Party is not required to make an increased payment to a Lender under paragraph (iii) above for a Tax Deduction in respect of tax imposed by the United Kingdom, Hong Kong or the United States of America (as the case may be) on a payment under the Loan Documents, if on the date on which the payment falls due:

(A) the payment could have been made to the relevant Lender without a Tax Deduction if the Lender had been a Qualifying Lender, but on that date that Lender is not or has ceased to be a Qualifying Lender other than as a result of any change after the date it became a Lender under this Agreement in (or in the interpretation, administration, or application of) any law or Treaty, or any published practice or concession of any relevant taxing authority;

(B) with respect to any payment to be made by a U.K. Credit Party, (i) the relevant Lender is a Qualifying Lender solely by virtue of paragraph (i)(B) of the definition of Qualifying Lender, (ii) an officer of H.M. Revenue & Customs has given (and not revoked) a direction (a “Direction”) under section 931 of the Income Tax ▇▇▇ ▇▇▇▇ of the United Kingdom which relates to that payment and that Lender has received from the Credit Party making the payment a certified copy of that Direction, and (iii) the payment could have been made to the relevant Lender without a Tax Deduction in the absence of that Direction;

(C) with respect to any payment to be made by a U.K. Credit Party, the relevant Lender is a Treaty Lender and the Credit Party making the payment is able to demonstrate that the payment could have been made to the Lender without the Tax Deduction had that Lender complied with its obligations under paragraph (vii) below;

(D) the relevant Lender is a Qualifying Lender solely by virtue of paragraph (i)(B) of the definition of Qualifying Lender and:

(i)	the relevant Lender has not given a Tax Confirmation to the Borrower Representative (on behalf of the U.K. Credit Parties); and

(ii)

the payment could have been made to the Lender without any Tax Deduction if the Lender had given a Tax Confirmation to the Borrower Representative (on behalf of the U.K. Credit Parties), on the basis that the Tax Confirmation would have enabled the U.K. Credit Parties to have formed a reasonable belief that the payment was an “excepted payment” for the purpose of section 930 of the Income Tax ▇▇▇ ▇▇▇▇;

(E) with respect to any payments to be made by a Domestic Credit Party, the Tax is (i) assessed on a Lender under (x) the law of the jurisdiction in which that Lender is incorporated or, if different, the jurisdiction (or jurisdictions) in which that Lender is treated as resident for tax purposes, (y) the law of the jurisdiction in which that Lender’s facility office is located in respect of amounts received or receivable in that jurisdiction or (z) the law of the jurisdiction with which that Lender and the jurisdiction have a present or former connection (other than such connection arising from any Lender having executed, delivered or performed its obligations or received a payment under, or enforced, any Loan Document) and (ii) imposed on or measured by net income with respect to that Lender or such Tax is a franchise tax or branch profits tax, or imposed in lieu of a net income Tax; or

(F) the payment is subject to U.S. federal withholding Taxes imposed under FATCA.

(v) If any Credit Party is required to make a Tax Deduction, such Credit Party shall make such Tax Deduction and any payment required in connection with such Tax Deduction within the time allowed and in the minimum amount required by law.

(vi) Within thirty days of making either a Tax Deduction or any payment required in connection with a Tax Deduction, the Credit Party making such Tax Deduction shall deliver to the Administrative Agent for the applicable Lender either a statement under section 975 of the Income Tax ▇▇▇ ▇▇▇▇ or other evidence reasonably satisfactory to such Lender that such Tax Deduction has been made or (as applicable) any appropriate payment paid to the relevant taxing authority.

(vii) A Treaty Lender and a Credit Party which makes a payment to which that Treaty Lender is entitled shall cooperate in completing any procedural formalities necessary for that Credit Party to obtain authorization to make that payment without a Tax Deduction. The Administrative Agent shall file a syndicated loan scheme application form with H.M. Revenue & Customs as soon as practicable following the Closing Date. A Treaty Lender shall discharge its obligation under this provision if it provides to the Administrative Agent its

DTTP number and jurisdiction of tax residence and any other information required by the Administrative Agent to file or maintain the syndicated loan scheme application.

(viii) A U.K. Non-Bank Lender shall promptly notify the Administrative Agent who shall notify the U.K. Credit Parties if there is any change in the position from that set out in the Tax Confirmation.

(ix) Each Lender which becomes a party to this Agreement after the date of this Agreement (such Lender, a “New Lender”) shall indicate, in the Assignment Agreement which it executes on becoming a party, and for the benefit of the Administrative Agent and without liability to any Credit Party, which of the following categories it falls in:

(A) not a Qualifying Lender;

(B) a Qualifying Lender (other than a Treaty Lender); or

If a New Lender fails to indicate its status in accordance with this paragraph (ix), then such New Lender shall be treated for the purposes of this Agreement (including by each U.K. Credit Party) as if it is not a Qualifying Lender until such time as it notifies the Administrative Agent which category applies (and the Administrative Agent, upon receipt of such notification, shall inform the Borrower Representative on behalf of the U.K. Credit Parties). For the avoidance of doubt, an Assignment Agreement shall not be invalidated by any failure of a Lender to comply with this paragraph (ix).

(x) If a payment made to a Lender under any Loan Document would be subject to U.S. federal withholding Tax imposed by FATCA if such Lender were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the IRC, as applicable), such Lender shall deliver to Borrowers and the Administrative Agent at the time or times prescribed by law and at such time or times reasonably requested by Borrowers or the Administrative Agent, such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the IRC) and such additional documentation reasonably requested by Borrowers or the Administrative Agent as may be necessary for Borrowers and the Administrative Agent to comply with their obligations under FATCA and to determine that such Lender has complied with such Lender’s obligations under FATCA or to determine the amount to deduct and withhold from such payment. Solely for purposes of this clause (x), “FATCA” shall include any amendments made to FATCA after the date of this Agreement.

(b) Tax indemnity.

(i) The Credit Parties shall (within three Business Days of demand by the Administrative Agent) pay (or procure payment) to a Protected Party an amount equal to the loss, liability or cost which that Protected Party determines will be or has been (directly or indirectly) suffered for or on account of Tax by that Protected Party in respect of any Loan Document.

(ii) Paragraph (b)(i) above shall not apply:

(A) with respect to any Tax (i) assessed on a Lender (x) under the law of the jurisdiction in which that Lender is incorporated or, if different, the jurisdiction (or jurisdictions) in which that Lender is treated as resident for tax purposes or (y) under the law of the jurisdiction in which that Lender’s facility office is located in respect of amounts received or receivable in that jurisdiction and (ii) imposed on or calculated by reference to the net income received or receivable (but not any sum deemed to be received or receivable) by that Lender; and

(B) to the extent a loss, liability or cost (i) is compensated for by an increased payment under Section 1.16(a) or (ii) would have been compensated for by an increased payment under Section 1.16(a) but was not so compensated solely because one of the exclusions in Section 1.16(a)(iv) applied.

(iii) A Protected Party making, or intending to make, a claim under paragraph (i) above shall promptly notify the Administrative Agent of the event which will give, or has given, rise to the claim, following which the Administrative Agent shall notify the Borrower Representative.

(iv) A Protected Party shall, on receiving a payment from a Credit Party under this Section 1.16(b), notify the Administrative Agent.

(i) a Tax Credit is attributable either to an increased payment under Section 1.16(a) of which that Tax Payment forms part, or to that Tax Payment; and

(ii) that Lender has obtained, utilized and retained that Tax Credit,

the Lender shall pay an amount to the applicable Credit Party which that Lender determines will leave it (after that payment) in the same after-Tax position as it would have been in had the Tax Payment not been required to be made by such Credit Party.

(d) Stamp Taxes. The Credit Parties shall pay, and within three Business Days of demand, indemnify each Lender against any cost, loss, or liability that a Lender incurs in relation to all stamp, duty, registration and other similar Taxes payable in respect of the Loan Documents.

(e) Value Added Tax.

(i) All amounts expressed in the Loan Documents to be payable by any Credit Party to a Lender or any Agent which (in whole or in part) constitute the consideration for a supply or supplies for VAT purposes shall be deemed to be exclusive of VAT. If VAT is or becomes chargeable on any supply made by any Lender or any Agent to any Credit Party in connection with any Loan Document, such Credit Party shall pay to such Lender

or Agent, as applicable, (in addition to and at the same time as paying the consideration for such supply) an amount equal to the amount of such VAT (and such Lender shall promptly provide an appropriate VAT invoice to the relevant Credit Party).

(ii) Where any Loan Document requires any Credit Party to reimburse or indemnify a Lender or any Agent for any cost or expense, such Credit Party shall reimburse or indemnify (as the case may be) such Lender or such Agent, as applicable, for the full amount of such cost or expense, including such part thereof as represents VAT, except to the extent that such Lender or such Agent, as applicable, reasonably determines that it is entitled to credit or repayment in respect of such VAT from the relevant tax authority.

(iii) Any reference in this Section 1.16(e) to any Credit Party shall, at any time when such Credit Party is treated as a member of a group for VAT purposes, include (where appropriate and unless the context otherwise requires) a reference to the representative member of such group at such time (the term “representative member” to have the same meaning as in the Value Added Tax ▇▇▇ ▇▇▇▇ of the United Kingdom).

1.17	Capital Adequacy; Increased Costs; Illegality.

(a) If any law, treaty, governmental (or quasi governmental) rule, regulation, guideline or order regarding capital adequacy, liquidity, reserve requirements or similar requirements or compliance by any Lender (including, as applicable, as L/C Issuer) with any request or directive regarding capital adequacy, liquidity, reserve requirements or similar requirements (whether or not having the force of law), in each case, adopted after the Closing Date, from any central bank or other Governmental Authority increases or would have the effect of increasing the amount of capital, reserves or other funds required to be maintained by such Lender and thereby reducing the rate of return on such Lender’s capital as a consequence of its obligations hereunder, then Borrowers shall from time to time upon demand by such Lender (with a copy of such demand to the Administrative Agent) pay to the Administrative Agent, for the account of such Lender, additional amounts sufficient to compensate such Lender for such reduction. A certificate as to the amount of that reduction and showing the basis of the computation thereof submitted by such Lender to Borrower Representative and to the Administrative Agent shall be presumptive evidence of the matters set forth therein.

(b) If, due to either (i) the introduction of or any change in any law or regulation (or any change in the interpretation thereof) or (ii) the compliance with any guideline or request from any central bank or other Governmental Authority (whether or not having the force of law), in each case adopted after the Closing Date, there shall be any increase in the cost to any Lender (including, as applicable, as L/C Issuer) of agreeing to make or making, funding or maintaining any Loan or Letter of Credit (or any participation in any Loan or Letter of Credit purchased pursuant to Section 9.9(e)(i)), then Borrowers shall from time to time, upon demand by such Lender (with a copy of such demand to the Administrative Agent), pay to the Administrative Agent for the account of such Lender additional amounts sufficient to compensate such Lender for such increased cost. A certificate as to the amount of such increased cost, submitted to Borrower Representative and to the Administrative Agent by such Lender, shall be presumptive evidence of the matters set forth therein. Each Lender agrees that, as promptly as practicable after it becomes aware of any circumstances referred to above which

would result in any such increased cost, the affected Lender shall, to the extent not inconsistent with such Lender’s internal policies of general application, use reasonable commercial efforts to minimize costs and expenses incurred by it and payable to it by Borrowers pursuant to this Section 1.17(b). For the avoidance of doubt, Sections 1.17(a) and 1.17(b) shall not apply to Taxes which shall be exclusively governed by Section 1.16.

(c) (i) Notwithstanding anything to the contrary contained herein, if the introduction of or any change in any law or regulation (or any change in the interpretation thereof) shall make it unlawful, or any central bank or other Governmental Authority shall assert that it is unlawful, for any Lender to agree to make or to make or to continue to fund or maintain any LIBOR Loan (or a participation interest in any LIBOR Loan), then, unless that Lender is able to make or to continue to fund or to maintain such LIBOR Loan (or participation interest, as applicable) at another branch or office of that Lender without, in that Lender’s reasonable opinion, materially adversely affecting it, its Loans or its participation interests in Loans or the income obtained therefrom, on notice thereof and demand therefor by such Lender to Borrower Representative through the Administrative Agent, (x) the obligation of such Lender to agree to make or to make or to continue to fund or maintain LIBOR Loans (or participation interests in LIBOR Loans) shall terminate and (y) each Borrower shall forthwith prepay in full all outstanding LIBOR Loans owing by such Borrower to such Lender (or to the Fronting Lender, to the extent of the participation interests in LIBOR Loans of the Fronting Lender held by such Lender, and the Fronting Lender shall pay such amounts to such Lender in respect of such participation interests), together with interest accrued thereon, unless Borrower Representative on behalf of such Borrower, within five (5) Business Days after the delivery of such notice and demand, converts all LIBOR Loans into Index Rate Loans.

(ii) If the Administrative Agent shall have determined in good faith that for any reason adequate and reasonable means do not exist for ascertaining the Dollar LIBOR Rate, the Sterling LIBOR Rate, the Euro LIBOR Rate or the Hong Kong Dollars LIBOR Rate, as applicable, for any requested LIBOR Period with respect to a proposed LIBOR Loan or that the Dollar LIBOR Rate, the Sterling LIBOR Rate, the Euro LIBOR Rate or the Hong Kong Dollars LIBOR Rate, as applicable, applicable pursuant to Section 1.5(a) for any requested LIBOR Period with respect to a proposed LIBOR Loan does not adequately and fairly reflect the cost to the Lenders of funding such Loan, the Administrative Agent will forthwith give notice of such determination to Borrower Representative and each Lender. Thereafter, the obligation of the Lenders to make or maintain LIBOR Loans hereunder shall be suspended until the Administrative Agent revokes such notice in writing. Upon receipt of such notice, Borrower Representative may revoke any Notice of Revolving Credit Advance or Notice of Conversion/Continuation then submitted by it. If Borrower Representative does not revoke such notice, Lenders shall make, convert or continue the Loans, as proposed by Borrower Representative, in the amount specified in the applicable notice submitted by Borrower Representative, but such Loans shall be made, converted or continued as Index Rate Loans.

(d) Within thirty (30) days after receipt by Borrower Representative of written notice and demand from any Lender (an “Affected Lender”) for payment of additional amounts or increased costs as provided in Sections 1.16(a), 1.17(a) or 1.17(b), Borrower Representative may, at its option, notify the Administrative Agent and such Affected Lender of its intention to replace the Affected Lender. Borrower Representative may obtain, at Borrowers’ expense, a

replacement Lender (“Replacement Lender”) for the Affected Lender, so long as (i) no Default or Event of Default has occurred and is continuing, and (ii) the Administrative Agent has consented to such replacement (such consent not to be unreasonably withheld or delayed if such Replacement Lender constitutes a Qualified Assignee). If Borrowers obtain a Replacement Lender within ninety (90) days following notice of their intention to do so, the Affected Lender must sell and assign its outstanding Loans, Letter of Credit Obligations and Commitments to such Replacement Lender for an amount equal to the outstanding principal balance of all Loans held by the Affected Lender and all accrued interest and Fees with respect thereto through the date of such sale and such assignment shall not require the payment of an assignment fee to the Administrative Agent; provided, that Borrowers shall have reimbursed such Affected Lender for the additional amounts or increased costs that it is entitled to receive under this Agreement through the date of such sale and assignment. Notwithstanding the foregoing, Borrowers shall not have the right to obtain a Replacement Lender if the Affected Lender rescinds its demand for increased costs or additional amounts within 15 days following its receipt of Borrowers’ notice of intention to replace such Affected Lender. Furthermore, if Borrowers give a notice of intention to replace and do not so replace such Affected Lender within ninety (90) days thereafter, Borrowers’ rights under this Section 1.17(d) shall terminate with respect to such Affected Lender and Borrowers shall promptly pay all increased costs or additional amounts demanded by such Affected Lender pursuant to Sections 1.16(a), 1.17(a) and 1.17(b). Notwithstanding the foregoing, with respect to a Lender that is a Non-Funding Lender or an Impacted Lender, the Administrative Agent may, but shall not be obligated to, obtain a Replacement Lender and execute an Assignment Agreement on behalf of such Non-Funding Lender or Impacted Lender at any time with three (3) Business Days’ prior notice to such Lender (unless notice is not practicable under the circumstances) and cause such Lender’s Loans, participations and Commitments to be sold and assigned, in whole or in part, at par.

(e) Notwithstanding anything herein to the contrary, (i) the ▇▇▇▇-▇▇▇▇▇ ▇▇▇▇ Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (ii) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States of America or foreign regulatory authorities, in each case in respect of this clause (ii), pursuant to Basel III, shall, in each case, be deemed to be a change in regulation regarding capital adequacy or liquidity under Section 1.17(a) and/or a change in law under Section 1.17(b), as applicable, regardless of the date enacted, adopted or issued.

1.18	Credit Support.

All Loans to each Domestic Borrower and all of the other Obligations of the each Domestic Borrower arising under this Agreement and the other Loan Documents shall constitute one general obligation of the Domestic Borrowers secured, until the Termination Date, by all of the Collateral covered under the Domestic Collateral Documents. All Loans to each Foreign Borrower and all of the other Obligations of each Foreign Borrower arising under this Agreement and the other Loan Documents shall constitute one general obligation of both the Domestic Borrowers and the Foreign Borrowers secured, until the Foreign Obligations Termination Date, by all of the Collateral covered under the Collateral Documents.

1.19	Conversion to Dollars and Foreign Currency.

(a) Except as expressly set forth herein, all valuations or computations of monetary amounts set forth in this Agreement shall include the Dollar Equivalent of Sterling, Euro, Hong Kong Dollars or any other applicable currency. All currency conversions to be made under this Agreement shall be made in accordance with the following procedure:

(i) Conversions to Dollars shall occur in accordance with prevailing exchange rates, as determined by the Administrative Agent or the Fronting Lender, as applicable, in its reasonable discretion, on the applicable date.

(ii) Conversions to any Foreign Currency shall occur in accordance with prevailing exchange rates, as determined by the Administrative Agent or the Fronting Lender, as applicable, in its reasonable discretion, on the applicable date.

(iii) The Dollar Equivalent of each of the Revolving Credit Advances, Swing Line Advances and Letter of Credit Obligations denominated in currencies other than Dollars shall be re-calculated on (a) so long as the Maximum Borrowing Availability equals or exceeds $5,000,000, the first Business Day of each month and (b) otherwise, the first Business Day of each week.

(b) All valuations or computations of monetary amounts set forth in any Borrowing Base Certificate, any Art Inventory Report, any Art Loan Receivables Report, any Extended Term Art Receivables Report or any other report, certificate, Financial Statement or other document delivered by any Credit Party to the Administrative Agent hereunder shall be made in accordance with GAAP and the ordinary business practices of the Credit Parties as of the Closing Date; provided, that any such report or document shall set forth the conversion factors used with respect to any foreign currencies.

1.20	Judgment Currency; Contractual Currency.

(a) If, for the purpose of obtaining or enforcing judgment against any Credit Party in any court in any jurisdiction, it becomes necessary to convert into any other currency (such other currency being hereinafter in this Section 1.20 referred to as the “Judgment Currency”) an amount due under any Loan Document in any currency (the “Obligation Currency”) other than the Judgment Currency, the conversion shall be made at the rate of exchange prevailing on the Business Day immediately preceding (i) the date of actual payment of the amount due, in the case of any proceeding in the courts of any jurisdiction that will give effect to such conversion being made on such date, or (ii) the date on which the judgment is given, in the case of any proceeding in the courts of any other jurisdiction (the applicable date as of which such conversion is made pursuant to this Section 1.20 being hereinafter referred to as the “Judgment Conversion Date”).

(b) If, in the case of any proceeding in the court of any jurisdiction referred to in Section 1.20(a), there is a change in the rate of exchange prevailing between the Judgment Conversion Date and the date of actual receipt for value of the amount due, the applicable Credit Party shall pay such additional amount (if any, but in any event not a lesser amount) as may be necessary to ensure that the amount actually received in the Judgment Currency, when converted

at the rate of exchange prevailing on the date of payment, will produce the amount of the Obligation Currency which could have been purchased with the amount of the Judgment Currency stipulated in the judgment or judicial order at the rate of exchange prevailing on the Judgment Conversion Date. Any amount due from a Credit Party under this Section 1.20(b) shall be due as a separate debt and shall not be affected by judgment being obtained for any other amounts due under or in respect of any of the Loan Documents.

(c) The term “rate of exchange” in this Section 1.20 means the rate of exchange at which the Administrative Agent would, on the relevant date at or about noon (New York City time), be able to sell the Obligation Currency against the Judgment Currency to prime banks.

(d) Any amount received or recovered by any Agent in respect of any sum expressed to be due to them (whether for itself or on behalf of any other person) from any Credit Party under this Agreement or under any of the other Loan Documents in a currency other than the currency (the “contractual currency”) in which such sum is so expressed to be due (whether as a result of, or from the enforcement of, any judgment or order of a court or tribunal of any jurisdiction, the winding-up of a Borrower or otherwise) shall only constitute a discharge of such Borrower to the extent of the amount of the contractual currency that such Agent is able, in accordance with its usual practice, to purchase with the amount of the currency so received or recovered on the date of receipt or recovery (or, if later, the first date on which such purchase is practicable). If the amount of the contractual currency so purchased is less than the amount of the contractual currency so expressed to be due, such Borrower shall indemnify such Agent against any loss sustained by it as a result, including the cost of making any such purchase other than losses resulting from the gross negligence or willful misconduct of the Person seeking such indemnification.

1.21	Currency of Account.

Dollars are the currency of account and payment for each and every sum at any time due from the Borrowers hereunder; provided, that:

(i) unless expressly provided elsewhere in this Agreement, each repayment of a Revolving Credit Advance or a part thereof advanced in any Foreign Currency shall be made in such Foreign Currency;

(ii) each payment of interest in respect of principal, or any other sum, denominated in any Foreign Currency shall be made in such Foreign Currency;

(iii) each payment in respect of costs and expenses incurred in any Foreign Currency shall be made in such Foreign Currency; and

(iv) any other amount expressed to be payable in any Foreign Currency shall be paid in such Foreign Currency.

2. CONDITIONS PRECEDENT

2.1	Conditions to Effectiveness of Agreement and the Initial Loans.

Neither any Lender nor the Fronting Lender shall be obligated to make any Loan or incur any Letter of Credit Obligations on the Closing Date, or to take, fulfill, or perform any other action hereunder, until the following conditions have been satisfied or provided for in a manner reasonably satisfactory to the Administrative Agent, or waived in writing by the Administrative Agent:

(a) Credit Agreement; Loan Documents. Each Loan Document delivered on the date hereof or counterparts thereof shall have been duly executed and delivered by Borrowers, each other Credit Party, each Agent and Lenders party thereto; and the Administrative Agent shall have received such documents, instruments, agreements and legal opinions as the Administrative Agent shall reasonably request in connection with the transactions contemplated by this Agreement and the other Loan Documents, including all those listed in the Closing Checklist attached hereto as Annex D, each in form and substance reasonably satisfactory to the Administrative Agent.

(b) Approvals. The Administrative Agent shall have received (i) satisfactory evidence that the Sotheby Entities have obtained all required consents and approvals of all Persons including all requisite Governmental Authorities, to the execution, delivery and performance of this Agreement and the other Loan Documents and the consummation of the Related Transactions or (ii) an officer’s certificate in form and substance reasonably satisfactory to the Administrative Agent affirming that no such consents or approvals are required (other than those that have been obtained).

(c) Opening Availability. After giving effect to the consummation of the Related Transactions, any initial Revolving Credit Advances made to Borrowers and the incurrence of any initial Letter of Credit Obligations, Borrowers shall have Aggregate Borrowing Availability of at least $150,000,000 as of the Closing Date.

(d) Payment of Fees. Borrowers shall have paid the Fees required to be paid on the Closing Date (including, without limitation, those specified in Section 1.10) and shall have reimbursed the Agents for all fees, costs and expenses of closing presented as of the Closing Date.

(e) SFS Revolving Credit Agreement. The Administrative Agent shall have received evidence satisfactory to it that the conditions precedent to the making of the initial loans and the issuance of any initial letters of credit under the SFS Revolving Credit Agreement (other than the satisfaction of the conditions precedent for the making of the initial Loans and the issuance of any initial Letters of Credit under this Agreement) have been satisfied (or waived in accordance with the terms thereof);

(f) Repayment of Prior Obligations. The Administrative Agent shall have received evidence satisfactory to it that all of the Indebtedness and other obligations (other than contingent reimbursement or indemnification obligations for which no claim has been made) under the Existing Credit Agreement have been repaid in full (except to the extent being so repaid with the initial Revolving Loans) by the Borrowers and their Affiliates and all Liens upon

any of the property of the Borrowers or any of their Subsidiaries in favor of GE Capital, as “Agent” under the Existing Credit Agreement, have been terminated.

(g) Other Indebtedness. All Obligations and all Liens granted under the Loan Documents shall constitute permitted indebtedness and permitted Liens, as applicable, under the Senior Note Indenture.

(h) No Material Adverse Change. Since December 31, 2012, no event shall have occurred that results in or causes, or could reasonably be expected to result in or cause, a Material Adverse Effect.

2.2	Further Conditions to Each Loan.

Except as otherwise expressly provided herein, neither any Lender nor the Fronting Lender shall be obligated to fund any Advance, convert or continue any portion of the outstanding Revolving Loan as a LIBOR Loan or incur any Letter of Credit Obligation, if, as of the date thereof:

(a) any representation or warranty by any Credit Party contained herein or in any other Loan Document is untrue or incorrect in any material respect (or, in the case of any representation or warranty already qualified by materiality, in any respect) as of such date (or in the case of a representation or warranty that is expressly made as of an earlier date, is untrue or incorrect as of such earlier date), except for changes therein expressly permitted or expressly contemplated by this Agreement, and the Requisite Lenders have determined not to make such Advance, convert or continue any portion of the outstanding Revolving Loan as LIBOR Loan or incur such Letter of Credit Obligation as a result of the fact that such warranty or representation is untrue or incorrect in any material respect (or, in the case of any representation or warranty already qualified by materiality, in any respect);

(b) any Default or Event of Default has occurred and is continuing or would result after giving effect to any Advance, the incurrence of any Letter of Credit Obligation, or the conversion or continuation of any portion of the outstanding Revolving Loan into, or as, a LIBOR Loan, and the Requisite Lenders shall have determined not to make any Advance, convert or continue any portion of the outstanding Revolving Loan as a LIBOR Loan or incur any Letter of Credit Obligation as a result of that Default or Event of Default;

(c) after giving effect to any Advance (or the incurrence of any Letter of Credit Obligations), (i) the Dollar Equivalent of the outstanding principal amount of the aggregate Revolving Loan would exceed the Maximum Amount less the then outstanding principal amount of the Swing Line Loan, (ii) the aggregate outstanding principal balance of Revolving Credit Advances and Swing Line Advances made to Domestic Borrowers and the Dollar Equivalent of the Letter of Credit Obligations incurred for the benefit of the Domestic Borrowers would, in the aggregate, exceed the Domestic Borrowing Base, (iii) the Dollar Equivalent of the outstanding amount of the Letter of Credit Obligations would exceed the L/C Sublimit, (iv) the aggregate outstanding principal amount of the Swing Line Loan would exceed Swing Line Availability or (v) the Dollar Equivalent of the aggregate outstanding principal balance of Revolving Credit Advances made to Foreign Borrowers and the Dollar Equivalent of

the outstanding amount of the Letter of Credit Obligations incurred for the benefit of the Foreign Borrowers would, in the aggregate, exceed either the Foreign Currency Subfacility Limit or the Foreign Borrowing Base; or

(d) notwithstanding the provisions of Annex F, the Borrowers shall not have delivered to the Administrative Agent a Borrowing Base Certificate, Art Inventory Report, Art Loan Receivables Report and Extended Term Art Receivables Report (accompanied in each case by such supporting detail and documentation as shall be requested by the Administrative Agent in its reasonable discretion), in each case prepared as of (i) with respect to any Advance to be made or Letter of Credit Obligation to be incurred during the first thirteen days of any Fiscal Month, the last of day of the second preceding Fiscal Month or (ii) with respect to any Advance to be made or Letter of Credit Obligation to be incurred during the remainder of any Fiscal Month, the last day of the preceding Fiscal Month.

The request and acceptance by any Borrower of the proceeds of any Advance, the incurrence of any Letter of Credit Obligations or the conversion or continuation of any portion of the outstanding Revolving Loan into, or as, a LIBOR Loan shall be deemed to constitute, as of the date thereof, (i) a representation and warranty by Borrowers that the conditions in this Section 2.2 have been satisfied and (ii) a reaffirmation by Borrowers of the cross-guaranty provisions set forth in Section 12 and of the granting and continuance of the Collateral Agent’s Liens, on behalf of itself and the other Secured Parties, pursuant to the Collateral Documents.

3. REPRESENTATIONS AND WARRANTIES

To induce Lenders and the Fronting Lender to make the Loans and to incur Letter of Credit Obligations (and to purchase participation interests in the Loans and Letter of Credit Obligations hereunder), the Credit Parties, jointly and severally, make the following representations and warranties to each Agent and each Lender with respect to all Sotheby Entities, each and all of which shall survive the execution and delivery of this Agreement.

3.1	Corporate Existence; Compliance with Law.

(a) Each Credit Party (i) is a corporation, limited liability company or limited partnership (or, in the case of Sotheby’s U.K., an unlimited liability company) duly organized, validly existing and in good standing under the laws of its respective jurisdiction of incorporation or organization set forth in Disclosure Schedule (3.1); (ii) is duly qualified to conduct business and is in good standing in each other jurisdiction where its ownership or lease of property or the conduct of its business requires such qualification, except where the failure to be so qualified would not result in exposure to losses or liabilities which could reasonably be expected to have a Material Adverse Effect; (iii) has the requisite power and authority and the legal right to own, pledge, mortgage or otherwise encumber and operate its properties, to lease the property it operates under lease and to conduct its business as now conducted or proposed to be conducted; and (iv) is in compliance with its charter and bylaws or partnership or operating agreement, as applicable.

(b) Each Sotheby Entity (i) subject to specific representations regarding Environmental Laws, has and will maintain in full force and effect all material licenses (including, for the avoidance of doubt, a license under the Consumer Credit ▇▇▇ ▇▇▇▇ of the

United Kingdom and the Consumer Credit ▇▇▇ ▇▇▇▇ of the United Kingdom (collectively, as each may be amended, extended or re-enacted from time to time, the “CCA”)), permits, consents, permissions, registrations, or approvals from or by, and has made all material filings with, and has given all notices to, all Governmental Authorities having jurisdiction, to the extent required, to enable such Sotheby Entity to carry on its business as currently conducted by it, to own its property and other assets, to extend Art Loans and generate Extended Term Art Receivables and to take security therefor; and (ii) subject to specific representations set forth herein regarding ERISA, Environmental Laws, tax and other laws, is in compliance with all applicable provisions of law, rule, regulation or guidance, except where the failure to comply, individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect.

3.2	Executive Offices, Collateral Locations, FEIN.

As of the Closing Date, each Domestic Credit Party’s name as it appears in official filings in its jurisdiction of incorporation or organization, jurisdiction of incorporation or organization, organization type, organization number, if any, issued by its jurisdiction incorporation or organization, and the current location of each Domestic Credit Party’s chief executive office and the warehouses and premises at which any Collateral is located are set forth in Disclosure Schedule (3.2), none of such locations has changed within the four (4) months preceding the Closing Date and each Domestic Credit Party has only one jurisdiction of incorporation or organization. In addition, Disclosure Schedule (3.2) lists the federal employer identification number of each Domestic Credit Party.

3.3	Corporate Power, Authorization, Enforceable Obligations.

The execution, delivery and performance by each Credit Party of the Loan Documents to which it is a party and the creation of all Liens provided for therein: (a) are within such Person’s power; (b) have been duly authorized by all necessary corporate, limited liability company, limited partnership or unlimited liability company action; (c) do not contravene any provision of any Sotheby Entity’s charter, bylaws or partnership or operating agreement as applicable; (d) do not violate any law or regulation, or any order or decree of any court or Governmental Authority; (e) do not conflict with or result in the breach or termination of, constitute a default under or accelerate or permit the acceleration of any performance required by, any indenture, mortgage, deed of trust, lease, agreement or other instrument to which any Sotheby Entity is a party or by which any Sotheby Entity or any of its property is bound, including, without limitation, the Senior Note Indenture, the Specified Senior Note Indenture or the York Avenue Lease Documents; (f) do not result in the creation or imposition of any Lien upon any of the property of any Sotheby Entity other than those in favor of the Collateral Agent, on behalf of itself and the other Secured Parties, pursuant to the Loan Documents; and (g) do not require the consent or approval of any Governmental Authority or any other Person. Each of the Loan Documents shall be duly executed and delivered by each Credit Party and each such Loan Document shall constitute a legal, valid and binding obligation of such Credit Party enforceable against it in accordance with its terms.

3.4	Financial Disclosures.

Except for the Projections, all Financial Statements concerning the Borrowers and their Subsidiaries that are referred to below (i) in the case of all Financial Statements concerning Parent and its Subsidiaries on a consolidated basis, have been prepared in accordance with GAAP consistently applied throughout the periods covered (except as disclosed therein and except, with respect to unaudited Financial Statements, for the absence of footnotes and normal year-end audit adjustments) and (ii) present fairly in all material respects the financial position of the Persons covered thereby as at the dates thereof and the results of their operations and cash flows for the periods then ended.

(a) Financial Statements. The following Financial Statements have been delivered on or prior to the date hereof:

(i) The audited consolidated (with respect to Parent and its Subsidiaries) balance sheets at December 31, 2011 and 2012 and the related consolidated statements of income and cash flows for the Fiscal Years then ended, which consolidated Financial Statements shall have been certified by Deloitte & Touche LLP, and the unaudited consolidating balance sheets and related consolidating statements of income of Parent and the Borrowers for such Fiscal Years.

(ii) The unaudited consolidated balance sheet at September 30, 2013, and the related statement(s) of income and cash flows of Parent and its Subsidiaries for the Fiscal

Quarter then ended, and the unaudited consolidating balance sheets and related consolidating statement of income of Parent and the Borrowers for such Fiscal Quarter.

(iii) The unaudited consolidated balance sheet at November 30, 2013, and the related statement of income of Parent and its Subsidiaries for the Fiscal Month then ended and the portion of the Fiscal Year then ended, and the unaudited consolidating balance sheets and related consolidating statement of income of Parent and the Borrowers for such Fiscal Month and such portion of such Fiscal Year.

(b) Projections. The Projections delivered on or prior to the date hereof have been prepared by the Borrowers in light of the past operations of their businesses and reflect projections for the 2014 Fiscal Year. The Projections are based upon the same accounting principles as those used in the preparation of the financial statements described above and the estimates and assumptions stated therein, all of which the Borrowers believe to be reasonable and fair in light of current conditions and current facts known to the Borrowers and, as of the Closing Date, reflect the Borrowers’ good faith and reasonable estimates of the future financial performance of Parent and its Subsidiaries for the period set forth therein. The Projections are not a guaranty of future performance, and actual results may differ from the Projections.

(c) Debt Disclosure. As of the Closing Date, no Sotheby Entity is liable on any “Credit Facilities” (as defined in the Senior Note Indenture) other than pursuant to this Agreement and the SFS Revolving Credit Agreement.

3.5	Material Adverse Effect.

Since December 31, 2012, no event has occurred, that alone or together with other events, could reasonably be expected to have a Material Adverse Effect.

3.6	Ownership of Property; Liens.

As of the Closing Date, Disclosure Schedule (3.6) lists all of the real property owned, leased, subleased, occupied, or used by any Credit Party (the “Real Estate”) and discloses which Credit Party is the owner, lessee, licensee or occupier of such Real Estate. Except as a result of Permitted Encumbrances or Liens expressly permitted under Section 6.7(i), each Credit Party owns good and marketable freehold or fee simple title to all of its owned Real Estate, and valid and marketable leasehold interests in all of its leased Real Estate. Disclosure Schedule (3.6) further describes any Real Estate with respect to which any Credit Party is a lessor, sublessor or assignor as of the Closing Date. Except as a result of Permitted Encumbrances, each Credit Party also has title to, or valid leasehold interests in, all of its personal property and assets. As of the Closing Date, none of the properties and assets of any Sotheby Entity are subject to any Liens other than Permitted Encumbrances, and there are no facts, circumstances or conditions known to any Sotheby Entity that may result in any Liens (including Liens arising under Environmental Laws) other than Liens expressly permitted pursuant to Section 6.7. Disclosure Schedule (3.6) also describes any purchase options, rights of first refusal or other similar contractual rights pertaining to any Real Estate.

3.7	Labor Matters.

Except as set forth on Disclosure Schedule 3.7, as of the Closing Date (a) there are no strikes, lockouts or slowdowns against any Credit Party pending or, to the knowledge of any Credit Party, threatened; (b) the hours worked by and payments made to employees of each Credit Party have not been in violation of the Fair Labor Standards Act or any other applicable Federal, state, local or foreign law dealing with such matters except where such violation could not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect; (c) all material payments due from any Credit Party, or for which any claim may be made against any Credit Party, on account of wages and employee health and welfare insurance and other benefits, have been paid or accrued as a liability on the books of such Credit Party; and (d) there are no complaints, charges, claims or other causes of action against any Credit Party pending or, to the knowledge of any Credit Party, threatened to be filed with any Governmental Authority or arbitrator based on, arising out of, in connection with, or otherwise relating to the employment or termination of employment by any Credit Party of any individual, which if adversely determined could reasonably be expected to have a Material Adverse Effect.

3.8	Ventures, Subsidiaries and Affiliates; Outstanding Stock and Indebtedness.

Except as set forth in Disclosure Schedule (3.8), as of the Closing Date, no Sotheby Entity has any Subsidiaries, is engaged in any joint venture or partnership with any other Person (other than Art Loan/Inventory Joint Ventures), or is an Affiliate of any other Person. All of the issued and outstanding Stock of each Sotheby Entity is owned by each of the

Stockholders and in the amounts set forth in Disclosure Schedule (3.8). Except as set forth in Disclosure Schedule (3.8), there are no outstanding rights to purchase, options, warrants or similar rights or agreements pursuant to which any Sotheby Entity may be required to issue, sell, repurchase or redeem any of its Stock or other equity securities or any Stock or other equity securities of its Subsidiaries. All outstanding Indebtedness and Guaranteed Indebtedness of each Credit Party as of the Closing Date (except for the Obligations) is described in Section 6.3 (including Disclosure Schedule (6.3)).

3.9	Government Regulation.

No Sotheby Entity is an “investment company” or an “affiliated person” of, or “promoter” or “principal underwriter” for, an “investment company,” as such terms are defined in the Investment Company Act of 1940. The making of the Loans by Lenders to Borrowers, the incurrence of the Letter of Credit Obligations on behalf of Borrowers and the application of the proceeds thereof and repayment thereof will not violate any provision of any such statute or any rule, regulation or order issued by the Securities and Exchange Commission.

3.10	Margin Regulations.

No Sotheby Entity is engaged, principally or as one of its important activities, in the business of purchasing or selling Margin Stock or extending credit for the purpose of purchasing or carrying Margin Stock. No Sotheby Entity owns any Margin Stock (other than Stock of Parent, to the extent it constitutes Margin Stock, in an amount that does not exceed 25% of the assets of the Credit Parties).

3.11

Taxes.

All Federal and other material tax returns, reports and statements, including information returns, required by any Governmental Authority to be filed by any Sotheby Entity have been filed, or will be timely filed, with the appropriate Governmental Authority, and all Charges have been paid excluding Charges or other amounts being contested in accordance with Section 5.2(b) and unless the failure to so file or pay could not reasonably be expected to result in a Material Adverse Effect. Disclosure Schedule (3.11) sets forth as of the Closing Date those taxable years for which any Sotheby Entity’s tax returns are currently being audited by the IRS or any other applicable Governmental Authority, and any assessments or threatened assessments in connection with such audit, or otherwise currently outstanding where the amount of such assessments, individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect. Except as described in Disclosure Schedule (3.11), as of the Closing Date, no Sotheby Entity has executed or filed with the IRS or any other Governmental Authority any agreement or other document extending, or having the effect of extending, the period for assessment or collection of any material Charges. None of the Sotheby Entities and their respective predecessors are liable for any Charges: (a) under any agreement (including any tax sharing agreements) or (b) to each Sotheby Entity’s knowledge, as a transferee. As of the Closing Date, no Sotheby Entity has agreed or been requested to make any adjustment under IRC Section 481(a), by reason of a change in accounting method or otherwise, which would reasonably be expected to have a Material Adverse Effect.

3.12	ERISA/U.K. Pension Plans.

(a) Disclosure Schedule (3.12(a)) lists, as of the Closing Date, all Plans subject to Section 412 of the IRC or Section 302 of ERISA, including all Title IV Plans, all Multiemployer Plans, and all Retiree Welfare Plans. Copies of all such listed Plans, together with a copy of the latest form IRS/DOL 5500-series and related actuarial reports, as applicable, for each such Plan, have been made available to the Administrative Agent. Except with respect to Multiemployer Plans, each Qualified Plan has been determined by the IRS to qualify under Section 401(a) of the IRC, the trusts created thereunder have been determined to be exempt from tax under the provisions of Section 501(a) of the IRC, and nothing has occurred that would cause the loss of such qualification or tax exempt status. Each Plan is in compliance in all material respects with the applicable provisions of ERISA, the IRC and its terms, including the timely filing of all reports required under the IRC or ERISA. Neither any Sotheby Entity nor ERISA Affiliate has failed to make any material contribution or pay any material amount due as required by either Section 412 of the IRC or Section 302 of ERISA or the terms of any such Plan. Neither any Sotheby Entity nor ERISA Affiliate has failed to make a contribution payment on or before the applicable due date which could result in the imposition of a lien under Section 430(k) of the IRC or Section 303(k) of ERISA. No “prohibited transaction,” as defined in Section 406 of ERISA and Section 4975 of the IRC, has occurred with respect to any Plan, that would subject any Sotheby Entity to a material tax on prohibited transactions imposed by Section 502(i) of ERISA or Section 4975 of the IRC.

(b) Except as set forth in Disclosure Schedule (3.12(a)): (i) no Title IV Plan has any material Unfunded Pension Liability; (ii) no ERISA Event has occurred or is reasonably expected to occur; (iii) there are no pending, or to the knowledge of any Sotheby Entity, threatened material claims (other than claims for benefits in the normal course), sanctions, actions or lawsuits, asserted or instituted against any Plan or any Person as fiduciary or sponsor of any Plan; (iv) no Sotheby Entity or ERISA Affiliate has incurred or reasonably expects to incur any material liability as a result of a complete or partial withdrawal from a Multiemployer Plan; (v) within the last five years no Title IV Plan of any Sotheby Entity or ERISA Affiliate has been terminated, whether or not in a “standard termination” as that term is used in Section 4041 of ERISA, nor has any Title IV Plan of any Sotheby Entity or any ERISA Affiliate (determined at any time within the last five years) with material Unfunded Pension Liabilities been transferred outside of the “controlled group” (within the meaning of Section 4001(a)(14) of ERISA) of any Sotheby Entity or ERISA Affiliate (determined at such time), (vi) except in the case of any ESOP, Stock of all Credit Parties and their ERISA Affiliates makes up, in the aggregate, no more than 10% of fair market value of the assets of any Plan measured on the basis of fair market value as of the latest valuation date of any Plan; and (vii) no liability under any Title IV Plan has been satisfied with the purchase of a contract from an insurance company that is not rated AAA by Standard & Poor’s Ratings Group or an equivalent rating by another nationally recognized rating agency.

(c) Disclosure Schedule (3.12(c)) lists, as of the Closing Date, all pension plans or arrangements operating in the United Kingdom through which any Sotheby Entity currently contributes or could be required to contribute (the “U.K. Pension Plans”). There are no amounts which are treated under Section 75 of the Pensions ▇▇▇ ▇▇▇▇ of the United Kingdom as due to any other pension scheme operated in the United Kingdom in which any Sotheby Entity

has been a participating employer. Disclosure Schedule (3.12(c)) separately identifies which of the U.K. Pension Plans is a defined benefit plan and which is a defined contribution plan. All of the U.K. Pension Plans are registered pension schemes as defined in chapter 2 of part 4 of the Finance ▇▇▇ ▇▇▇▇ of the United Kingdom. There is no plan of any U.K. Credit Party (or, to the knowledge of the U.K. Credit Parties, of any other Person having the power to amend or terminate any U.K. Pension Plan) to amend or terminate any U.K. Pension Plan or otherwise do any act or omission so as to give rise to any claim by the trustees of that plan whether under the related trust deed or rules of that plan or under Section 75 of the Pensions ▇▇▇ ▇▇▇▇ of the United Kingdom. Contributions have been made to the U.K. Pension Plans as required under their relevant schedule of contributions and recovery plan (if any) in force from time to time as those terms are defined in Part 3 of the Pensions ▇▇▇ ▇▇▇▇ of the United Kingdom in all material respects. There are no facts or circumstances which may give rise to the Pensions Regulator issuing, or to the knowledge of any Sotheby Entity threatening to issue, a Financial Support Directive or a Contribution Notice with respect to any U.K. Pension Plans.

3.13	Litigation.

No action, claim, lawsuit, demand, investigation or proceeding is now pending or, to the knowledge of any Sotheby Entity, threatened against any Sotheby Entity, before any Governmental Authority or before any court or any arbitrator or panel of arbitrators (collectively, “Litigation”), (a) that challenges any Credit Party’s right or power to enter into or perform any of its obligations under the Loan Documents to which it is a party, or the validity or enforceability of any Loan Document or any action taken thereunder, or (b) that has a reasonable risk of being determined adversely to any Sotheby Entity and that, if so determined, could reasonably be expected to have a Material Adverse Effect. Except as set forth on Disclosure Schedule (3.13(a)), as of the Closing Date there is no Litigation pending or, to any Sotheby Entity’s knowledge, threatened, that seeks damages in excess of $10,000,000 or injunctive relief against, or alleges criminal misconduct of, any Sotheby Entity.

3.14

Brokers.

Except as set forth on Disclosure Schedule 3.14, no broker or finder brought about the obtaining, making or closing of the Loans, and no Sotheby Entity or Affiliate thereof has any obligation to any Person in respect of any finder’s or brokerage fees in connection therewith.

3.15	Intellectual Property.

As of the Closing Date, each Sotheby Entity owns or has rights to use all Intellectual Property necessary to continue to conduct its business as now conducted by it or presently proposed to be conducted by it, and each material License and each registration pending or registered Patent, Trademark and Copyright owned by the Credit Parties is listed, together with the related application or registration number, as applicable, and the owner thereof, in Disclosure Schedule (3.15). Each Sotheby Entity conducts its business and affairs without infringement of or interference with any Intellectual Property of any other Person in any material respect. As of the Closing Date, except as set forth in Disclosure Schedule (3.15), no Credit

Party is aware of any material infringement claim by any other Person with respect to any Intellectual Property owned by the Credit Parties.

3.16	Full Disclosure.

No information contained in this Agreement, any of the other Loan Documents, Financial Statements or Collateral Reports or other written reports from time to time prepared by any Sotheby Entity and delivered hereunder or any written statement prepared by any Sotheby Entity and furnished by or on behalf of any Sotheby Entity to any Agent or any Lender pursuant to the terms of this Agreement (other than Projections, other forward-looking information and information of a general economic or industry-specific nature) contains or will, at the time of delivery thereof, contain any untrue statement of a material fact or omits or will omit to state a material fact necessary to make the statements contained herein or therein not misleading in light of the circumstances under which they were made. The Projections delivered hereunder are based upon the estimates and assumptions stated therein, all of which Borrowers believed at the time of delivery to be reasonable and fair in light of current conditions and current facts known to Borrowers as of such delivery date, and reflect Borrowers’ good faith and reasonable estimates of the future financial performance of Borrowers and of the other information projected therein for the period set forth therein. The Projections are not a guaranty of future performance and actual results may differ from those set forth in the Projections. The Liens granted to the Collateral Agent, on behalf of itself and the other Secured Parties, pursuant to the Collateral Documents will at all times be valid, fully perfected first priority security interests in the Collateral described therein (except as otherwise set forth in the Collateral Documents), subject, as to priority, only to Permitted Encumbrances that would be prior to Liens in favor of the Collateral Agent as a matter of law.

3.17	Environmental Matters.

(a) Except as set forth in Disclosure Schedule (3.17), as of the Closing Date: (i) the owned Real Estate is, and, to the knowledge of the Credit Parties, the leased Real Estate is, in each case, free of contamination from any Hazardous Material except for such contamination that would not adversely impact the value or marketability of such Real Estate and that would not result in Environmental Liabilities that could reasonably be expected to have a Material Adverse Effect; (ii) no Sotheby Entity has caused or suffered to occur any material Release of Hazardous Materials on, at, in, under, above, to, from or about any of its Real Estate; (iii) the Sotheby Entities are and have been in compliance with all Environmental Laws, except for such noncompliance that would not result in Environmental Liabilities which could reasonably be expected to have a Material Adverse Effect; (iv) the Sotheby Entities have obtained, and are in compliance with, all Environmental Permits required by Environmental Laws for the operations of their respective businesses as presently conducted or as proposed to be conducted, except where the failure to so obtain or comply with such Environmental Permits would not result in Environmental Liabilities that could reasonably be expected to have a Material Adverse Effect; (v) no Sotheby Entity is involved in operations or knows of any facts, circumstances or conditions, including any Releases of Hazardous Materials, that are likely to result in any Environmental Liabilities of such Sotheby Entity which could reasonably be expected to have a Material Adverse Effect; (vi) there is no Litigation arising under or related to any Environmental Laws, Environmental Permits or Hazardous Material that seeks damages, penalties, fines, costs

or expenses that could reasonably be expected to have a Material Adverse Effect or injunctive relief against, or that alleges criminal misconduct by, any Sotheby Entity; (vii) no notice has been received by any Sotheby Entity identifying it as a “potentially responsible party” or requesting information under CERCLA or analogous state statutes, and to the knowledge of the Sotheby Entities, there are no facts, circumstances or conditions that may result in any Sotheby Entity being identified as a “potentially responsible party” under CERCLA or analogous state statutes; and (viii) the Sotheby Entities have made available to the Administrative Agent copies of all existing environmental reports, reviews and audits and all written information pertaining to actual or potential Environmental Liabilities, in each case relating to any Sotheby Entity.

(b) Each Credit Party hereby acknowledges and agrees that neither Agent (i) is now or has ever been in control of any of the Real Estate or any Credit Party’s affairs, and (ii) has the capacity through the provisions of the Loan Documents or otherwise to influence any Credit Party’s conduct with respect to the ownership, operation or management of any of its Real Estate or compliance with Environmental Laws or Environmental Permits.

3.18	Insurance.

Disclosure Schedule (3.18) lists all insurance policies of any nature maintained, as of the Closing Date, for current occurrences by each Credit Party.

3.19

Deposit.

Disclosure Schedule (3.19) lists all banks and other financial institutions at which any Credit Party maintains deposit or other accounts, and such Schedule correctly identifies the name, address and telephone number of each depository, the name in which the account is held, a description of the purpose of the account, the complete account number therefor and whether such account contains amounts payable to consignors representing proceeds of the sale of consigned Works of Art.

3.20	[Reserved].

3.21	Bonding; Licenses.

Except as set forth on Disclosure Schedule (3.21) or entered into in the ordinary course of business, as of the Closing Date, no Sotheby Entity is a party to or bound by any surety bond agreement or bonding requirement with respect to products or services sold by it or any trademark or patent license agreement with respect to products sold by it.

3.22

Solvency.

Both before and after giving effect to (a) the Loans and Letter of Credit Obligations to be made or incurred on the Closing Date or such other date as Loans and Letter of Credit Obligations requested hereunder are made or incurred, (b) the disbursement of the proceeds of such Loans pursuant to the instructions of Borrower Representative; (c) the consummation of the Related Transactions; and (d) the payment and accrual of all transaction costs in connection with the foregoing, Parent and its Subsidiaries, on a consolidated basis, are and will be Solvent.

3.23	Sale-Leasebacks.

No Sotheby Entity is a party to any sale-leaseback, synthetic lease or similar transaction involving any of its assets.

3.24	U.S. Money-Laundering and Terrorism Regulatory Matters.

(a) No Sotheby Entity or any Affiliate of any Sotheby Entity, nor, to their knowledge, any of their respective officers or directors or any of their respective brokers, investors or other agents acting or benefiting in any capacity in connection with Loans, is a Prohibited Person.

(b) No Sotheby Entity or any Affiliate of any Sotheby Entity, nor any of their respective officers or directors (i) to such Sotheby Entity’s knowledge, has conducted or will conduct any business or has engaged or will engage in any transaction or dealing with any Prohibited Person, including making or receiving any contribution of funds, goods or services to or for the benefit of any Prohibited Person, (ii) to such Sotheby Entity’s knowledge, has dealt or will deal in, or otherwise has engaged or will engage in any transaction relating to, any Prohibited Person or any property or interests in property blocked pursuant to the Executive Order or (iii) to their knowledge, has engaged or will engage in or has conspired or will conspire to engage in any transaction that evades or avoids, or has the purpose of evading or avoiding, or attempts to violate, any of the requirements or prohibitions set forth in the Executive Order or the PATRIOT Act.

(c) Each Sotheby Entity and its Affiliates, and, to their knowledge, their respective officers and directors are in full compliance with (i) the Trading with the Enemy Act, and each of the foreign assets control regulations, applicable orders and rules issued by, and recommendations of the U.S. Department of the Treasury and OFAC pursuant to IEEPA, and any other enabling legislation or executive order relating thereto, (ii) the PATRIOT Act and (iii) other federal or state laws relating to “know your customer”, anti-money laundering, sanctions or terrorism rules and regulations and any executive orders related thereto. No part of the proceeds of any Loan will be used directly or indirectly for (x) any payments to any government official or employee, political party, official of a political party, candidate for political office, or anyone else acting in an official capacity, in order to obtain, retain or direct business or obtain any improper advantage, in violation in any material respect of the United States Foreign Corrupt Practices Act of 1977, or any applicable anti-corruption laws in other jurisdictions or (y) business activities related to Cuba, Iran, Myanmar, North Korea, Sudan and Syria, or that are subject to sanctions imposed or administered by one of the sanctions bodies enumerated in clause (e) of the definition of “Prohibited Person”.

(d) Each Borrower has established an anti-money laundering and/or economic sanctions program and/or procedures in accordance with all applicable laws, rules and regulations of its own jurisdiction including, without limitation, where applicable, the PATRIOT Act. Each Borrower applies its anti-money laundering program and/or procedures to all Art Loan Debtors and Extended Term Art Debtors.

(e) Each Sotheby Entity has taken appropriate due diligence efforts to know, or has carried out appropriate customer due diligence in relation to, (i) each Art Loan Debtor to which it has advanced, or committed to advance, Art Loans and (ii) each Extended Term Art Debtor to which it has provided, or committed to provide, extended payment terms in connection with any Extended Term Art Receivable, in each case, including whether such Art Loan Debtor or Extended Term Art Debtor, as applicable, is a Prohibited Person. Each Sotheby Entity has taken appropriate due diligence efforts to know if any such Art Loan Debtor or Extended Term Art Debtor is a “Senior Foreign Political Figure” (as defined in the PATRIOT Act), a “Politically Exposed Person” (as defined in The Money Laundering Regulations 2007 of the United Kingdom) or a “politically exposed person” (as defined in The Anti-Money Laundering and Counter-Terrorist Financing (Financial Institutions) Ordinance of Hong Kong) and, to the extent that any Art Loan Debtor or Extended Term Art Debtor is a Senior Foreign Political Figure, a Politically Exposed Person or a politically exposed person (as aforementioned), has disclosed such information to the Administrative Agent.

(f) Each Borrower does not believe, and after appropriate due diligence, has no reason to believe, that any of its Art Loan Debtors or Extended Term Art Debtors is a “Prohibited Foreign Shell Bank” (as defined in the PATRIOT Act), or is named on any available lists of known or suspected terrorists, terrorist organizations or of other sanctioned person issued by the United States government and/or the government(s) of any jurisdiction(s) in which such Borrower is doing business.

(g) Each Sotheby Entity has adopted reasonable procedures in accordance with applicable law as of the Closing Date to elicit information that substantiates the statements contained in this Section 3.25.

3.25	Lending and Auction Regulatory Matters.

(a) Except as set forth in Disclosure Schedule (3.13(a)), each Credit Party that makes or owns Art Loans or Extended Term Art Receivables is in material compliance with, and each Art Loan and Extended Term Art Receivable has been made or generated, as applicable, and remains in material compliance with, all applicable provisions of federal, state, local and foreign laws imposed upon lenders with respect to consumer or commercial lending, usury or other limitations on interest, finance charges, or other charges, finance company or other lender licensing, consumer or commercial credit disclosure, consumer or commercial credit collection practices, and similar laws and regulations.

(b) Sotheby’s, Inc. and each other Credit Party that conducts auctions in the City of New York is in material compliance with, and each employee thereof who conducts auction in New York City maintains a valid license under, the City of New York’s Auctioneer Rules (Title 20, Chapter 2, Subchapter 13) and any applicable similar laws of other jurisdictions. Sotheby’s U.K. and each other Credit Party which conducts auctions in the United Kingdom is in material compliance with, and maintains valid licenses (if required) under, all laws, regulations and auctioneer’s licensing requirements applicable in the United Kingdom, if any. Sotheby’s H.K. and each other Credit Party which conducts auctions in Hong Kong is in material compliance with, and maintains valid licenses (if required) under, all laws, regulations and auctioneer’s licensing requirements applicable in Hong Kong, if any.

4. FINANCIAL STATEMENTS AND INFORMATION

4.1	Reports and Notices.

(a) Each Credit Party hereby agrees that from and after the Closing Date and until the Termination Date, it shall deliver to the Administrative Agent, the Collateral Agent and/or Lenders, as required, the Financial Statements, notices, Projections and other information at the times, to the Persons and in the manner set forth in Annex E.

(b) Each Credit Party hereby agrees that, from and after the Closing Date and until the Termination Date, it shall deliver the various Collateral Reports (including Borrowing Base Certificates in the form of Exhibit 4.1(A), Art Loan Receivables Reports in the form of Exhibit 4.1(B), Art Inventory Reports in the form of Exhibit 4.1(C) and Extended Term Art Receivables Reports in the form of Exhibit 4.1(D)) at the times, to the Persons and in the manner set forth in Annex F and Section 2.2(d).

5. AFFIRMATIVE COVENANTS

Each Credit Party jointly and severally agrees as to all Sotheby Entities that from and after the date hereof and until the Termination Date:

5.1	Maintenance of Existence and Conduct of Business.

Each Sotheby Entity shall: do or cause to be done all things necessary to preserve and keep in full force and effect its corporate, partnership, limited liability company or unlimited liability company existence and its material rights and franchises, except as otherwise permitted under Section 6.1; continue to conduct its business substantially as now conducted or as otherwise permitted hereunder; at all times maintain, preserve and protect all of its assets and properties used or useful in the conduct of its business, and keep the same in good repair, working order and condition in all material respects (taking into consideration ordinary wear and tear) and from time to time make, or cause to be made, all necessary or appropriate repairs, replacements and improvements thereto consistent with industry practices.

5.2	Payment of Charges.

(a) Subject to Section 5.2(b), each Sotheby Entity shall pay and discharge or cause to be paid and discharged promptly all Charges payable by it, including (i) Charges imposed upon it, its income and profits, or any of its property (real, personal or mixed) and all Charges with respect to tax, social security and unemployment withholding with respect to its employees, (ii) lawful claims for labor, materials, supplies and services or otherwise, and (iii) all storage or rental charges payable to warehousemen or bailees, in each case, before any thereof shall become past due, in each case, except where the failure to pay or discharge such Charges would not result in aggregate liabilities in excess of $5,000,000.

(b) Each Sotheby Entity may in good faith contest, by appropriate proceedings, the validity or amount of any Charges or claims described in Section 5.2(a); provided, that (i) adequate reserves with respect to such contest are maintained on the books of such Sotheby Entity, in accordance with GAAP; (ii) no Lien shall be imposed to secure payment

of such Charges (other than payments to warehousemen and/or bailees) that is superior to any of the Liens securing the Obligations and such contest is maintained and prosecuted continuously and with diligence and operates to suspend collection or enforcement of such Charges; (iii) none of the Collateral becomes subject to forfeiture or loss as a result of such contest; and (iv) such Sotheby Entity shall promptly pay or discharge such contested Charges or claims and all additional charges, interest, penalties and expenses, if any, if such contest is terminated or discontinued adversely to such Sotheby Entity.

5.3	Books and Records.

Each Sotheby Entity shall keep adequate books and records with respect to its business activities in which proper entries, reflecting all financial transactions, are made. Parent shall keep adequate books and records with respect to the business activities of Parent and its Subsidiaries on a consolidated basis in which proper entries, reflecting all financial transactions, are made in accordance with GAAP and on a basis consistent with the Financial Statements attached as Disclosure Schedule (3.4(a)).

5.4	Insurance; Damage to or Destruction of Collateral.

(a) The Sotheby Entities shall, at their sole cost and expense, maintain policies of insurance with financially sound and reputable insurance companies in such amounts, and covering such risks, as is consistent with sound business practice and customary for their industry. In the case of the Credit Parties, such policies of insurance (or the loss payable and additional insured endorsements delivered to the Collateral Agent) shall contain provisions pursuant to which the insurer agrees to provide thirty (30) days prior written notice to the Collateral Agent in the event of any non-renewal, cancellation or amendment of any such insurance policy. If any Sotheby Entity at any time or times hereafter shall fail to obtain or maintain any of the policies of insurance required above, or to pay all premiums relating thereto, any Agent may at any time or times thereafter obtain and maintain such policies of insurance and pay such premiums and take any other action with respect thereto that such Agent deems advisable. Neither Agent shall have any obligation to obtain insurance for any Sotheby Entity or pay any premiums therefor. By doing so, neither Agent shall be deemed to have waived any Default or Event of Default arising from any Sotheby Entity’s failure to maintain such insurance or pay any premiums therefor. All sums so disbursed, including reasonable attorneys’ fees, court costs and other charges related thereto, shall be payable on demand by Borrowers to the applicable Agent and shall be additional Obligations hereunder secured by the Collateral.

(b) If reasonably requested by any Agent, each Sotheby Entity shall deliver to such Agent from time to time a report of a reputable insurance broker, reasonably satisfactory to such Agent, with respect to its insurance policies.

(c) Each Credit Party shall deliver to the Collateral Agent, in form and substance reasonably satisfactory to the Collateral Agent, endorsements to (i) all “All Risk,” Lender Single Interest (“LSI”) and Fine Arts property policies of insurance (including, to the extent permitted under the York Avenue Lease Documents and York Avenue Loan Documents, the business interruption insurance of such Credit Party), in each case, naming the Collateral Agent, on behalf of itself and the other Secured Parties, as a lender loss payee, and (ii) all

general, automotive, and umbrella liability policies of insurance, in each case, naming the Collateral Agent, on behalf of itself and the other Secured Parties, as additional insured. Each Credit Party irrevocably makes, constitutes and appoints each Agent (and all officers, employees or agents designated by any Agent), so long as any Default or Event of Default has occurred and is continuing, as such Credit Party’s true and lawful agent and attorney in fact for the purpose of making, settling and adjusting claims under such “All Risk” property policies of insurance, endorsing the name of such Credit Party on any check or other item of payment for the proceeds of such “All Risk” policies of insurance and for making all determinations and decisions with respect to such “All Risk” policies of insurance. No Agent shall have any duty to exercise any rights or powers granted to it pursuant to the foregoing power-of-attorney. Borrower Representative shall promptly notify each Agent of any loss, damage, or destruction to the Collateral in the amount of $2,000,000 or more, whether or not covered by insurance. After deducting from the proceeds of insurance received with respect to any such loss, damage or destruction to the Collateral (i) the expenses incurred by any Agent in the collection or handling thereof, and (ii) amounts required to be paid to creditors (other than the Secured Parties) having Permitted Encumbrances, the Agents (A) shall apply the Ratable Share of any such proceeds to the reduction of the Obligations in accordance with Section 1.3(d) or (e), as applicable, except to the extent that the applicable Credit Party has given notice of its intent to reinvest such proceeds in productive assets of a kind then used or usable in the business of a Credit Party, within one hundred eighty (180) days after the date of receipt of such proceeds; provided that the Borrower Representative notifies Collateral Agent of such Credit Party’s intent to reinvest and of the completion of such reinvestment at the time such proceeds are received and when such reinvestment occurs, respectively and (B) shall, to the extent the Ratable Share of such proceeds are not required to be applied to prepay the Obligations pursuant to Section 1.3(c), remit such proceeds to the applicable Credit Party.

5.5	Compliance with Laws.

Each Sotheby Entity shall comply with all federal, state, local and foreign laws, rules and regulations applicable to it, including those relating to ERISA, labor, money laundering, counter-terrorist financing, consumer or commercial lending (including, for the avoidance of doubt, the CCA and the rules and regulations from time to time in effect thereunder or in connection therewith), usury, limitations on interest, finance charges or other charges, finance company licensing, consumer or commercial credit disclosure, debt collection, auctioneers, Environmental Laws and Environmental Permits, except to the extent that the failure to comply, individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect.

5.6	Supplemental Disclosure.

From time to time as may be reasonably requested by the Administrative Agent (which request will not be made more frequently than once each year absent the occurrence and continuance of an Event of Default) or at Credit Parties’ election, the Credit Parties shall supplement each Disclosure Schedule hereto, or any representation herein or in any other Loan Document, with respect to any matter hereafter arising that, if existing or occurring at the date of this Agreement, would have been required to be set forth or described in such Disclosure Schedule or as an exception to such representation or that is necessary to correct any information

in such Disclosure Schedule or representation which has been rendered inaccurate thereby (and, in the case of any supplements to any Disclosure Schedule, such Disclosure Schedule shall be appropriately marked to show the changes made therein); provided that (a) no such supplement to any such Disclosure Schedule or representation shall amend, supplement or otherwise modify any Disclosure Schedule or representation, or be or be deemed a waiver of any Default or Event of Default resulting from the matters disclosed therein, except as consented to by the Agents and Requisite Lenders in writing, and (b) no supplement shall be required or permitted as to representations and warranties that relate solely to the Closing Date.

5.7	Intellectual Property.

Each Sotheby Entity will conduct its business and affairs without infringement of or interference with any Intellectual Property of any other Person in any material respect and shall comply in all material respects with the terms of its Licenses.

5.8	Environmental Matters.

Each Sotheby Entity shall and shall cause each Person within its control to: (a) conduct its operations and keep and maintain its Real Estate in compliance with all Environmental Laws and Environmental Permits other than noncompliance that could not reasonably be expected to have a Material Adverse Effect; (b) implement any and all investigation, remediation, removal and response actions that are appropriate or necessary to maintain the value and marketability of the Real Estate or to otherwise comply with Environmental Laws and Environmental Permits pertaining to the presence, generation, treatment, storage, use, disposal, transportation or Release of any Hazardous Material on, at, in, under, above, to or from any of its Real Estate in all material respects; (c) notify the Administrative Agent promptly after such Sotheby Entity becomes aware of any violation of Environmental Laws or Environmental Permits or any Release on, at, in, under, above, to or from any Real Estate that is reasonably likely to result in Environmental Liabilities that could reasonably be expected to have a Material Adverse Effect; and (d) promptly forward to the Administrative Agent a copy of any order, notice, request for information or any communication or report received by such Sotheby Entity in connection with any such violation or Release or any other matter relating to any Environmental Laws or Environmental Permits that could reasonably be expected to result in Environmental Liabilities that could reasonably be expected to have a Material Adverse Effect, in each case whether or not the Environmental Protection Agency or any Governmental Authority has taken or threatened any action in connection with any such violation, Release or other matter. If the Administrative Agent at any time has a reasonable basis to believe that there may be a violation of any Environmental Laws or Environmental Permits by any Sotheby Entity or any Environmental Liability arising thereunder, or a Release of Hazardous Materials on, at, in, under, above, to or from any of its Real Estate, that, in each case, could reasonably be expected to have a Material Adverse Effect, then each Sotheby Entity shall, upon the Administrative Agent’s written request (i) cause the performance of such environmental audits including subsurface sampling of soil and groundwater, and preparation of such environmental reports, at Borrowers’ expense, as the Administrative Agent may from time to time reasonably request, subject to any leases, which shall be conducted by reputable environmental consulting firms reasonably acceptable to the Administrative Agent and shall be in form and substance reasonably acceptable to the Administrative Agent, and (ii) permit

the Administrative Agent or its representatives to have access to all Real Estate for the purpose of conducting such environmental audits and testing as the Administrative Agent deems appropriate, including subsurface sampling of soil and groundwater. Borrowers shall reimburse the Administrative Agent for the costs of such audits and tests and the same will constitute a part of the Obligations secured hereunder.

5.9	Landlords’ Agreements, Bailee Letters and Real Estate Purchases.

With respect to each leased property indicated on Disclosure Schedule (3.6), each Credit Party shall use commercially reasonable efforts to obtain a landlord’s agreement, in form and substance reasonably satisfactory to the Administrative Agent, from the applicable lessor with respect to each such indicated locations. After the Closing Date, if any Credit Party proposes to lease during any Fiscal Year any real property locations or warehouse spaces (or renew an existing lease of any real property locations or warehouse spaces, or alter the use of any leased location to materially increase the Collateral stored or located at such location) where Collateral having a book value the Dollar Equivalent of which is greater than $1,000,000 in the aggregate will be stored or located, such Credit Party shall first notify the Administrative Agent thereof and, upon request of the Administrative Agent, provide to the Administrative Agent a landlord agreement or bailee letter, as appropriate, with respect to such location, in form and substance reasonably satisfactory to the Administrative Agent. Each Credit Party shall timely and fully pay and perform its obligations under all leases and other agreements with respect to each leased location or public warehouse where any Collateral is or may be located. To the extent otherwise permitted hereunder, if any Credit Party proposes to acquire a fee ownership interest in Real Estate after the Closing Date, such Credit Party shall first notify the Administrative Agent thereof and, upon request of the Administrative Agent, provide to the Administrative Agent a mortgage or deed of trust granting the Collateral Agent a first priority security interest on such Real Estate, together with environmental audits, mortgage title insurance commitment, real property survey, local counsel opinion(s), supplemental casualty insurance and flood insurance, and such other documents, instruments or agreements reasonably requested by the Administrative Agent, in each case, in form and substance reasonably satisfactory to the Administrative Agent.

5.10	Lending and Auction Regulatory Matters.

(a) Each Credit Party shall remain in material compliance with all applicable provisions of federal, state, local and foreign laws imposed upon lenders with respect to consumer or commercial lending, usury or other limitations on interest, finance charges or other charges, finance companies, finance company or other lender licensing, consumer or commercial credit disclosure, consumer or commercial credit collection practices, and similar laws and regulations.

(b) Sotheby’s, Inc. and each other Credit Party that conducts auctions in the City of New York shall remain in material compliance with, and maintain a valid license under, the City of New York’s Auctioneer Rules (Title 20, Chapter 2, Subchapter 13) and any applicable similar laws of other jurisdictions. Sotheby’s U.K. and each other Credit Party that conducts auctions in the United Kingdom shall remain in material compliance with, and maintain valid licenses under, all laws, regulations and auctioneer’s licensing requirements applicable in

the United Kingdom, if any. Sotheby’s H.K. and each other Credit Party that conducts auctions in Hong Kong shall remain in material compliance with, and maintain valid licenses under, all laws, regulations and auctioneer’s licensing requirements applicable in Hong Kong, if any.

5.11	Further Assurances.

Each Credit Party agrees that it shall and shall cause each other Sotheby Entity to, at such Credit Party’s expense and upon the reasonable request of any Agent, duly execute and deliver, or cause to be duly executed and delivered, to such Agent such further instruments and do and cause to be done such further acts as may be necessary or proper in the reasonable opinion of such Agent to carry out more effectively the provisions and purposes of this Agreement and each Loan Document.

5.12	Art Loans, Art Inventory and Extended Term Art Receivables.

Each Borrower shall (a) in connection with the acquisition of each Work of Art as Art Inventory, conduct appropriate diligence with respect to such Work of Art (including, as applicable, searches of such Work of Art in the Art Loss Register) consistent with past practices and (b) in connection with each Art Loan made or to be made by it and in connection with each Extended Term Art Receivable generated or to be generated by it, (i) apply credit standards and loan to collateral value requirements, (ii) conduct appropriate diligence with respect to the applicable Work(s) of Art (including, as applicable, searches of such Work(s) of Art in the Art Loss Register), (iii) follow practices with respect to documentation, perfection and protection of security interests and (iv) follow practices with respect to classification of Art Loans and Extended Term Art Receivables as non-accrual, as such standards, requirements and practices are generally applied and followed in the Borrowers’ art lending business prior to the Closing Date.

5.13	Money-Laundering and Terrorism Regulatory Matters.

(a) Each Sotheby Entity shall remain in compliance in all material respects with all applicable orders, rules and regulations applicable to it, including those issued by the U.S. Department of the Treasury and OFAC pursuant to IEEPA, the PATRIOT Act, other legal requirements relating to sanctions, money laundering or terrorism and any executive orders related thereto.

(b) Each Sotheby Entity is advised that, by law, the Agents and the Lenders may be obligated to “freeze its account”, either by prohibiting additional Revolving Credit Advances or Letter of Credit Obligations, declining any withdrawal, redemption or transfer request(s) with respect to any deposit account under the control of either Agent or the Lenders and/or segregating assets, in compliance with government regulations, and the Agents and the Lenders may also be required to report such action to governmental or regulatory authorities, including OFAC.

(c) Each Borrower shall maintain an anti-money laundering, counter-terrorist financing and/or economic sanctions program and/or procedures in accordance with all applicable laws, rules and regulations of its own jurisdiction including, without limitation, where applicable, the PATRIOT Act, the Money Laundering Regulations 2007 of the United Kingdom

and the Anti-Money Laundering and Counter-Terrorist Financing (Financial Institutions) Ordinance (Cap. 615 of the laws of Hong Kong). Each Borrower shall apply its anti-money laundering and counter-terrorist financing program and/or procedures to all Art Loan Debtors and Extended Term Art Debtors and shall take appropriate steps in accordance with the laws of its own jurisdiction to ensure that all required relevant documentation is retained, including identification related to such Art Loan Debtors or Extended Term Art Debtors, as applicable, in accordance with its anti-money laundering, counter-terrorist financing and/or economic sanctions program. Each Borrower shall adopt appropriate policies, procedures and internal controls to be compliant in all material respects with any additional laws, rules or regulations relating to money laundering and/or counter-terrorist financing, including the PATRIOT Act, to which it may become subject.

(d) Each Sotheby Entity shall take appropriate due diligence efforts to know, and appropriate customer due diligence in relation to, each Art Loan Debtor to which it shall advance, or commit to advance, Art Loans and each Extended Term Art Debtor to which it shall provide, or commit to provide, extended payment terms in connection with any Extended Term Art Receivable, including whether such Art Loan Debtor or Extended Term Art Debtor, as applicable, is a Prohibited Person. Each Sotheby Entity shall take appropriate due diligence efforts to know if any such Art Loan Debtor or Extended Term Art Debtor is a “Senior Foreign Political Figure” (as defined in the PATRIOT Act), a “Politically Exposed Person” (as defined in The Money Laundering Regulations 2007 of the United Kingdom) or a “politically exposed person” (as defined in The Anti-Money Laundering and Counter-Terrorist Financing (Financial Institutions) Ordinance of Hong Kong) and, to the extent that any investor is a Senior Foreign Political Figure, a Politically Exposed Person or a politically exposed person (as aforementioned), shall disclose such information to the Administrative Agent.

(e) Each Sotheby Entity will notify or report unusual or suspicious activity to the extent required by the laws or requirements of its own jurisdiction including, where applicable, the PATRIOT Act.

(f) Each Sotheby Entity shall deliver to the Agents any certification or other evidence requested from time to time by any Agent in its sole discretion, confirming such Sotheby Entity’s compliance with this Section 5.13 and the representations and warranties made by such Sotheby Entity pursuant to Section 3.25.

5.14	Subsidiary Loan Documents.

(a) Subject to Sections 5.14(d) and 5.14(e), for each Person (other than a Disregarded Domestic Person) that is or becomes a direct Domestic Subsidiary of a Domestic Credit Party (which shall, for purposes of clarity, include all Domestic Subsidiaries (other than Disregarded Domestic Persons), whether direct or indirect, of a Domestic Credit Party, so long as such Domestic Subsidiaries are not direct or indirect Subsidiaries of one or more Foreign Subsidiaries of such Domestic Credit Party), within fifteen (15) days (or such later date as the Collateral Agent may agree to in its sole discretion) of becoming such a Domestic Subsidiary, (i) such Person shall become party to this Agreement as a Credit Party by executing a joinder agreement hereto, and shall execute joinder agreements to the Domestic Guaranty and Security Agreement and such further Collateral Documents as the Collateral Agent shall reasonably

request, in each case pursuant to the terms of each such agreement, (ii) 100% of the outstanding Stock of such Person owned by such Domestic Credit Party shall be pledged to the Collateral Agent, for the benefit of the Secured Parties, in support of the Secured Obligations of each of the Domestic Borrowers and the Foreign Borrowers, pursuant to such Collateral Documents as the Collateral Agent shall reasonably request and (iii) such Person shall deliver such organizational and authorization documentation and legal opinions as the Collateral Agent shall reasonably request, in each case in form and substance reasonably satisfactory to the Collateral Agent; provided, that, (x) so long as SPTC Delaware shall not create, incur, assume or permit to exist any Indebtedness or Guaranteed Indebtedness or any Lien on or with respect to any of its properties or assets (whether now owned or hereafter acquired), SPTC Delaware shall not be required to execute or become a party to any Loan Documents and its outstanding Stock shall not be required to be pledged, and (y) the York Avenue Owner shall not be required to execute or become a party to any Loan Documents and its outstanding Stock shall not be required to be pledged.

(b) Subject to Sections 5.14(d) and 5.14(e), for each Person that is or becomes a direct Foreign Subsidiary of any Credit Party and is organized under the laws of England or Hong Kong, within fifteen (15) days (or such later date as the Collateral Agent may agree to in its sole discretion) of becoming such a Foreign Subsidiary, (i) such Person shall become party to this Agreement as a Credit Party by executing a joinder agreement hereto, and shall execute each of a Guaranty with respect to the Secured Obligations of the Foreign Borrowers and such Collateral Documents as the Collateral Agent shall reasonably request in support of the Secured Obligations of the Foreign Borrowers, in each case pursuant to the terms of each such agreement, (ii) if such Person is a direct Foreign Subsidiary of a Foreign Credit Party, 100% of the outstanding Stock of such Person owned by such Foreign Credit Party shall be pledged to the Collateral Agent, for the benefit of the Secured Parties, in support of the Secured Obligations of the Foreign Borrowers pursuant to such Collateral Documents as the Collateral Agent shall reasonably request, (iii) if such Person is a direct Foreign Subsidiary of a Domestic Credit Party, 65% of the outstanding Stock of such Person owned by such Domestic Credit Party shall be pledged to the Collateral Agent, for the benefit of the Secured Parties, in support of the Secured Obligations of the Domestic Borrowers and the Foreign Borrowers (or, in the case of the outstanding Stock of York UK Holdco International Limited, the Secured Obligations of solely the Foreign Borrowers) pursuant to such Collateral Documents as the Collateral Agent shall reasonably request and (iv) such Person shall deliver such organizational and authorization documentation and legal opinions as the Collateral Agent shall reasonably request, in each case in form and substance reasonably satisfactory to the Collateral Agent.

(c) Subject to Sections 5.14(d) and 5.14(e), for each Person that is or becomes a direct Foreign Subsidiary of any Domestic Credit Party, and is organized under any jurisdiction other than England or Hong Kong, or is or becomes a direct Domestic Disregarded Person of a Domestic Credit Party, within fifteen (15) days (or such later date as the Collateral Agent may agree to in its sole discretion) of becoming such a Foreign Subsidiary or a Domestic Disregarded Person, (i) 65% of the outstanding Stock of such Person owned by such Domestic Credit Party shall be pledged to the Collateral Agent, for the benefit of the Secured Parties, in support of the Secured Obligations, pursuant to such Collateral Documents as the Collateral Agent shall reasonably request and (ii) such Person shall deliver such organizational and authorization

documentation and legal opinions as the Collateral Agent shall reasonably request, in each case in form and substance reasonably satisfactory to the Collateral Agent.

(d) Notwithstanding anything to the contrary contained herein or in any other Loan Document:

(i) Subject to clause (iii) of this Section 5.14(d), no Person that is a direct Foreign Subsidiary of another Foreign Subsidiary organized under a jurisdiction other than England or Hong Kong, shall be required to become subject to a pledge of its outstanding Stock or otherwise become a party to the Collateral Documents.

(ii) To the extent that the Collateral Agent determines in its sole discretion that (x) the cost is disproportionate to the benefit to be realized by the Collateral Agent and the other Secured Parties by obtaining a pledge of the outstanding Stock of any Person and/or a guarantee by, or security interest in, the assets of any Person or (y) the law of any jurisdiction prohibits (A) the outstanding Stock of any Person organized in such jurisdiction from becoming subject to a pledge thereof and/or (B) a guarantee by, or security interest in, the assets of any Person organized in such jurisdiction, such pledge of such Person’s outstanding Stock, such guarantee and/or such security interest shall not be required.

(iii) Subject to clause (ii) of this Section 5.14(d), with respect to any Person listed on Schedule 5.14, such Person’s Stock shall be pledged to the Collateral Agent, a security interest shall be granted to the Collateral Agent in the assets of such Person, and such Person shall be required to provide a guarantee, in each case, in accordance with the terms and conditions set forth on Schedule 5.14.

(iv) If any Guaranty or Collateral is required to be provided pursuant to the terms of the SFS Revolving Credit Agreement to secure the “Secured Obligations” of the “Domestic Credit Parties” under the SFS Revolving Credit Agreement, such Guaranty or Collateral, as applicable, shall also be provided under this Agreement to secure the Secured Obligations of the Domestic Credit Parties. If any Guaranty or Collateral is required to be provided pursuant to the terms of the SFS Revolving Credit Agreement to secure the “Secured Obligations” of the “Foreign Credit Parties” under the SFS Revolving Credit Agreement, such Guaranty or Collateral, as applicable, shall also be provided under this Agreement to secure the Secured Obligations of the Foreign Credit Parties. For the avoidance of doubt, notwithstanding the foregoing, the Foreign Borrowers shall have no liability, direct or indirect, for the Secured Obligations of the Domestic Borrowers or the other Domestic Credit Parties hereunder or under any of the other Loan Documents.

(e) This Section 5.14 shall not apply to any Immaterial Subsidiary set forth on Disclosure Schedule (5.15) as of the Closing Date unless such Person shall have executed a Guaranty and such Collateral Documents as the Collateral Agent shall reasonably request.

5.15	Immaterial Subsidiaries.

Each Immaterial Subsidiary (i) as of the Closing Date, owns assets having a book value of which the Dollar Equivalent is less than $100,000 and (ii) had earnings during the 2012 Fiscal Year of which the Dollar Equivalent was less than $100,000.

5.16	York Avenue Transactions.

Except as set forth on Disclosure Schedule (5.16), the York Avenue Lender has no recourse to Parent or any of its Subsidiaries or any assets of Parent or any of its Subsidiaries pursuant to the York Avenue Loan Agreement or any other York Avenue Loan Document.

5.17	Auction Guaranties.

Each Sotheby Entity shall comply with the provisions of the Auction Guaranty Side Letter.

5.18	Data Protection Matters.

To the extent and at all times that any Data Protection Laws will be applicable as a result of any Credit Party’s performance hereunder, such Credit Party shall comply in all material respects with all such Data Protection Laws including, without limitation, having obtained valid consents where necessary from any Persons whose Personal Data is provided in performance of this Agreement for (a) such Personal Data to be processed for the purposes required by each Credit Party in performance of this Agreement; (b) such Personal Data to be disclosed to any Agent or any Lender, or any agent or subcontractor of any Agent or any Lender, and to be processed by any Agent or any Lender for the purposes required in performance of this Agreement; and (c) the transfer of such Personal Data to any Agent or any Lender in a country outside of the European Economic Area. The form of any data protection consent shall be subject to prior approval of the Administrative Agent, who may require such amendments as it may consider necessary in order to comply with Data Protection Laws and who may require, upon reasonable prior notice, such other reasonable actions be taken by each Credit Party, including entering into the European Union’s standard contractual clauses for the transfer of personal data to third countries, to ensure compliance with Data Protection Laws. Each Credit Party shall not, by any act or omission, place any Agent or any Lender in breach of any Data Protection Laws.

6. NEGATIVE COVENANTS

Each Credit Party jointly and severally agrees as to all Sotheby Entities that from and after the date hereof until the Termination Date:

6.1	Mergers, Subsidiaries, Etc.

No Sotheby Entity shall directly or indirectly, by operation of law or otherwise, (a) acquire, liquidate or dissolve any Subsidiary or (b) merge with, consolidate with, acquire all or substantially all of the assets or Stock of, or otherwise combine with or acquire, any Person, except that any Sotheby Entity may merge with another Sotheby Entity; provided, that (i) Borrower Representative shall be the survivor of any such merger to which it is a party, (ii) any Borrower shall be the survivor of any such merger with any Sotheby Entity that is not a Borrower and (iii) any Guarantor shall be the survivor of any such merger with any Sotheby Entity that is not a Credit Party; provided, further, that any Sotheby Entity may dissolve or liquidate any Subsidiary thereof that is not a Borrower.

6.2	Investments; Loans and Revolving Credit Advances.

Except as otherwise expressly permitted by this Section 6, no Sotheby Entity shall make or permit to exist any investment in, or make, accrue or permit to exist loans or advances of money to, any Person, through the direct or indirect lending of money, holding of securities or otherwise, except that:

(a) Borrowers may hold investments comprised of notes payable, or stock or other securities issued by Account Debtors to any Borrower pursuant to negotiated agreements with respect to settlement of such Account Debtor’s Accounts in the ordinary course of business consistent with past practices;

(b) each Sotheby Entity may (i) maintain its existing investments in its Subsidiaries and joint ventures as of the Closing Date, (ii) make investments after the Closing Date in any Credit Party, or (iii) if such Sotheby Entity is not a Credit Party, make investments after the Closing Date in any other Sotheby Entity (other than any Immaterial Subsidiary);

(c) (i) any Borrower may enter into Art Loan/Inventory Joint Ventures and (ii) the Sotheby Entities may make investments after the Closing Date in joint ventures (other than Art Loan/Inventory Joint Ventures) and other Sotheby Entities (other than any Immaterial Subsidiary) to the extent investments in such other Sotheby Entities are not permitted pursuant to the foregoing clause (b) or Section 6.3(a)(vii)); provided that, unless the Fixed Charge Coverage Ratio, as of the end of the most recently completed Fiscal Quarter for which the Agents and Lenders have received Financial Statements pursuant hereto, shall be equal to or greater than 1.15 to 1.00 (calculated on a pro forma basis as if such investments had occurred during such Fiscal Quarter), investments permitted pursuant to clause (ii) of this Section 6.2(c) shall not exceed the Dollar Equivalent of $20,000,000 in the aggregate at any time outstanding;

(d) so long as the Collateral Agent has not delivered an Activation Notice with respect to any Blocked Account of a Sotheby Entity and no Default or Event of Default has occurred and is continuing, such Sotheby Entity may make investments in Cash Equivalent Investments;

(e) subject to applicable regulatory authorizations, any Borrower may make, or commit to make, Art Loans and provide, or commit to provide, extended payment terms to Extended Term Art Debtors for purposes of generating Extended Term Art Receivables;

(f) the Sotheby Entities may make investments in York Avenue Owner in an aggregate amount in any Fiscal Year not in excess of the sum of (i) the amount of Capital Expenditures permitted under paragraph (a) of Annex G for such Fiscal Year, less the aggregate amount of any Capital Expenditures made by Parent and its Subsidiaries (other than the York Avenue Owner) during such Fiscal Year plus (ii) additional amounts to purchase and upgrade a headquarters building;

(g) the trustee of the grantor trust established for purposes of setting aside assets to meet obligations of Sotheby’s, Inc. under the Sotheby’s Deferred Benefits Compensation Plan may make investments in connection with such plan; and

(h) the Sotheby Entities may make other investments (other than in any Immaterial Subsidiary or the York Avenue Owner) not exceeding $20,000,000 in the aggregate at any time outstanding.

6.3	Indebtedness.

(a) No Sotheby Entity shall create, incur, assume or permit to exist any Indebtedness, except (without duplication):

(i) the Senior Notes;

(ii) (A) the Specified Senior Notes or (B) obligations (contingent or otherwise) in respect of any Permitted U.K. Real Estate Financing in an aggregate principal amount not to exceed 65% of the fair market value of the Specified U.K. Real Estate subject to such Permitted U.K. Real Estate Financing at the time such Permitted U.K. Real Estate Financing is consummated (as reasonably determined by the Administrative Agent), and any refinancings thereof or amendments or modifications thereto that do not have the effect of (x) increasing the principal amount thereof to an aggregate principal amount greater than 65% of the fair market value of the Specified U.K. Real Estate subject to such financing at the time of such refinancing, amendment or modification (as reasonably determined by the Administrative Agent) or (y) reducing the average life thereof, and that are otherwise on terms and conditions no less favorable in any material respect to any Sotheby Entity, any Agent or any Lender, as determined by the Administrative Agent, than the terms of the Permitted U.K. Real Estate Financing being refinanced, amended or modified; provided that, for purposes of clarity, no Indebtedness in respect of any Specified Senior Notes shall be permitted pursuant to this clause (ii) if any Permitted U.K. Real Estate Financing is consummated and no Indebtedness in respect of any Permitted U.K. Real Estate financing shall be permitted pursuant to this clause (ii) if any Specified Senior Notes are issued;

(iii) obligations (contingent or otherwise) under the York Avenue Loan Documents and refinancings thereof or amendments or modifications thereto that do not have the effect of increasing the principal amount thereof to an aggregate principal amount greater than 65% of the fair market value of the real property subject to such financing at the time of such refinancing, amendment or modification (as reasonably determined by the Administrative Agent) or reducing the average life thereof and that are otherwise on terms and conditions no less favorable in any material respect to any Sotheby Entity, any Agent or any Lender, as determined by the Administrative Agent, than the terms of the York Avenue Loan Documents being refinanced, amended or modified;

(iv) Indebtedness secured by purchase money security interests and Capital Leases permitted in Section 6.7(e);

(v) the Loans and the other Secured Obligations;

(vi) existing Indebtedness described in Disclosure Schedule (6.3) and refinancings thereof or amendments or modifications thereto that do not have the effect of increasing the principal amount thereof or reducing the average life thereof and that are otherwise on terms and conditions no less favorable in any material respect to any Sotheby Entity, any Agent or any Lender, as determined by the Administrative Agent, than the terms of the Indebtedness being refinanced, amended or modified;

(vii) Indebtedness consisting of intercompany loans and advances made by any Sotheby Entity to any other Sotheby Entity (other than any Immaterial Subsidiary); provided, that: (A) in the case of any intercompany loan or advance owing to any Credit Party, any Sotheby Entity receiving the proceeds of such loan or advance shall have executed and delivered to the applicable Credit Party (i) in the case of any such loan or advance outstanding on the Closing Date, within sixty (60) days (or such later date as the Administrative Agent may agree to in its sole discretion) following the Closing Date or (ii) in the case of any such loan or advance incurred after the Closing Date, within fifteen (15) days (or such later date as the Administrative Agent may agree to in its sole discretion) after receiving the proceeds thereof, a demand note (collectively, the “Intercompany Notes”) to evidence any such intercompany Indebtedness owing at any time by such Sotheby Entity, which Intercompany Notes shall be in form and substance reasonably satisfactory to the Administrative Agent and shall be pledged and delivered to the Collateral Agent pursuant to the applicable Collateral Document as additional collateral security for the applicable Secured Obligations; (B) each Sotheby Entity shall record all intercompany transactions on its books and records in a manner reasonably satisfactory to the Administrative Agent; (C) the obligations of each Credit Party under any such intercompany loans and advances shall be subordinated to the Obligations of such Credit Party hereunder and under the other Loan Documents in a manner reasonably satisfactory to the Administrative Agent; (D) with respect to any intercompany loan or advance made after the Closing Date, at the time any such intercompany loan or advance is made by any Sotheby Entity to any other Sotheby Entity and after giving effect thereto, (i) each such Sotheby Entity shall be Solvent or (ii)(x) such intercompany loan or advance shall be made in the ordinary course of business, (y) if the Sotheby Entity making such intercompany loan or advance is a Credit Party, such Credit Party shall be Solvent and (z) the Sotheby Entity receiving such intercompany loan or advance shall have no Funded Debt (except as permitted hereby) other than intercompany loans or advances outstanding to other Sotheby Entities; and (E) no Default or Event of Default would occur and be continuing after giving effect to any such proposed intercompany loan or advance;

(viii) Indebtedness arising in respect of surety bonds, guaranties and letters of credit with respect to obligations of the Foreign Subsidiaries incurred in the ordinary course of business that are not Funded Debt;

(ix) Indebtedness arising under Rate Management Transactions; provided, that such Rate Management Transactions are (or were) entered into in the ordinary course of such Sotheby Entity’s business for the purpose of mitigating risks associated with liabilities, commitments, investments, assets, earnings or properties held or reasonably anticipated by such Sotheby Entity and not for purposes of speculation;

(x) Indebtedness arising under overdraft credit lines extended to various Sotheby Entities in the ordinary course of business, which indebtedness arising under

overdraft credit lines extended to the Credit Parties shall not at any time exceed, in the aggregate at any one time outstanding, the lesser of (A) $15,000,000 and (B) the aggregate amount of overdraft credit lines extended to the Credit Parties at such time; and

(xi) Other Indebtedness in an aggregate principal amount not exceeding $15,000,000 at any one time outstanding.

(b) No Sotheby Entity shall, directly or indirectly, voluntarily purchase, redeem, defease or prepay any principal of, premium, if any, interest or other amount payable in respect of any Indebtedness prior to its scheduled maturity, other than (i) the Obligations; (ii) Indebtedness secured by a Permitted Encumbrance if the asset securing such Indebtedness has been sold or otherwise disposed of in accordance with Section 6.8; (iii) Indebtedness permitted by Section 6.3(a)(vi) upon any refinancing thereof in accordance with Section 6.3(a)(vi); (iv) Indebtedness incurred pursuant to repayment by any Sotheby Entity of intercompany loans and advances outstanding to any Sotheby Entity, (v) so long as (x) no Default or Event of Default has occurred and is continuing or would occur as a result thereof, and (y) Parent shall have provided to the Administrative Agent prior to the date thereof pro forma financial statements demonstrating that the Fixed Charge Coverage Ratio, as of the end of the most recently completed Fiscal Quarter for which the Agents and Lenders have received Financial Statements pursuant hereto, shall be equal to or greater than 1.15 to 1.00 (calculated on a pro forma basis as if such purchase had occurred during such Fiscal Quarter), purchases, redemptions, defeasances or prepayments of the Senior Notes and the Specified Senior Notes by Parent; and (vi) so long as no Revolving Loans are outstanding hereunder and no “Revolving Loans” are outstanding under the SFS Revolving Credit Agreement as of the date of any such transaction, any purchases, redemptions, defeasances or prepayments of the Senior Notes or the Specified Senior Notes by Parent.

6.4	Employee Loans and Affiliate Transactions.

(a) Except as disclosed in Disclosure Schedule 6.4(a), no Sotheby Entity shall enter into or be a party to any transaction with any other Sotheby Entity or any Affiliate thereof except in the ordinary course of and pursuant to the reasonable requirements of such Sotheby Entity’s business and, in the case of any transaction with any Affiliate thereof (other than another Sotheby Entity), upon fair and reasonable terms that are no less favorable to such Sotheby Entity than would be obtained in a comparable arm’s length transaction with a Person not an Affiliate of such Sotheby Entity.

(b) No Sotheby Entity shall enter into any lending or borrowing transaction with any employees of any Sotheby Entity, except (i) loans to its respective employees in the ordinary course of business consistent with past practices for travel and entertainment expenses, relocation costs and similar purposes and stock option financing, up to a maximum of a Dollar Equivalent of $2,500,000 in the aggregate at any one time outstanding, (ii) Art Loans to employees of any Sotheby Entity in the ordinary course of business pursuant to fair and reasonable terms that are no less favorable to such Sotheby Entity making such Art Loan than would be obtained in a comparable arm’s length transaction with a Person not an employee of, or otherwise affiliated with, any Sotheby Entity, up to a maximum of a Dollar Equivalent of $25,000,000 in the aggregate at any one time outstanding and (iii) other loans to its respective

employees, up to a maximum of a Dollar Equivalent of $7,500,000 in the aggregate at any one time outstanding.

6.5	Capital Structure and Business.

If all or part of a Sotheby Entity’s Stock is pledged to the Collateral Agent, that Sotheby Entity shall not issue additional Stock unless, upon issuance thereof, such Stock is immediately pledged (and any related security certificates delivered) by the holder thereof to the Collateral Agent pursuant to the applicable Collateral Documents. No Sotheby Entity shall amend its charter or bylaws in a manner that would adversely affect any Agent or any Lender or such Sotheby Entity’s duty or ability to repay the Obligations. No Sotheby Entity shall engage in any business other than the businesses currently engaged in by it or businesses reasonably related thereto.

6.6	Guaranteed Indebtedness.

No Sotheby Entity shall create, incur, assume or permit to exist any Guaranteed Indebtedness except (a) by endorsement of instruments or items of payment for deposit to the general account of any Sotheby Entity, and (b) for Guaranteed Indebtedness incurred for the benefit of any other Sotheby Entity if the primary obligation with respect thereto is not prohibited by this Agreement.

6.7

Liens.

No Sotheby Entity shall create, incur, assume or permit to exist any Lien on or with respect to its Accounts or any of its other properties or assets (whether now owned or hereafter acquired) except for:

(a) Permitted Encumbrances;

(b) Liens created pursuant to the York Avenue Loan Documents;

(c) Liens (i) in existence on the date hereof, (ii) if such property or assets are owned by a Credit Party, summarized on Disclosure Schedule (6.7) and (iii) securing the Indebtedness described on Disclosure Schedule (6.3) and refinancings, extensions and renewals thereof, including extensions or renewals of any such Liens; provided, that the principal amount of the Indebtedness so secured is not increased and the Lien does not attach to any other property;

(d) Liens securing payment of obligations described in Section 6.3(a)(iv); provided, that such Liens shall not attach to any property other than cash on deposit with, or under the control of, the holder of such Indebtedness;

(e) Liens created after the date hereof by conditional sale or other title retention agreements (including Capital Leases) or in connection with purchase money Indebtedness with respect to Equipment and Fixtures acquired by any Sotheby Entity in the ordinary course of business, involving the incurrence of an aggregate amount of purchase money Indebtedness and Capital Lease Obligations of not more than a Dollar

Equivalent of $3,000,000 outstanding at any one time for all such Liens (provided that such Liens attach only to the assets subject to such purchase money debt and such Indebtedness is incurred within forty-five (45) days following such purchase and does not exceed 100% of the purchase price of the subject assets);

(f) Liens securing Indebtedness permitted pursuant to Section 6.3(a)(ix); provided, that such obligations are secured solely with cash and Cash Equivalent Investments;

(g) licenses and sublicenses permitted pursuant to Section 6.8(g);

(h) Liens not otherwise permitted above on (i) cash and Cash Equivalents or (ii) assets not constituting Collateral, in each case, so long as the aggregate amount of obligations secured by such Liens does not exceed $20,000,000; and

(i) Liens on any Specified U.K. Real Estate securing Indebtedness permitted pursuant to clause (ii)(B) of Section 6.3(a);

provided that, except as set forth in clause (i) of this Section 6.7, no Foreign Credit Party shall create, incur, assume or permit to exist any Lien on or with respect to its Real Estate other than Permitted Encumbrances described in clauses (a), (g) or (h) of the definition thereof. In addition, no Credit Party shall become a party to any agreement, note, indenture or instrument, or take any other action after the Closing Date that would prohibit the creation of a Lien on any of its properties or other assets in favor of the Collateral Agent, on behalf of itself and the other Secured Parties, as additional collateral for the applicable Secured Obligations, except (x) agreements entered into in connection with any Permitted U.K. Real Estate Financing that prohibit Liens upon any Specified U.K. Real Estate subject to such Permitted U.K. Real Estate Financing and (y) operating leases, Capital Leases, Licenses or agreements relating to purchase money Indebtedness which prohibit Liens upon the assets that are subject thereto.

6.8	Sale of Stock and Assets.

No Sotheby Entity shall sell, transfer, convey, assign or otherwise dispose of any of its properties or other assets, including the Stock of any of its Subsidiaries (whether in a public or a private offering or otherwise) or any of its Accounts, other than (a) the sale of Inventory in the ordinary course of business, (b) the sale or other disposition by a Sotheby Entity of Equipment or Fixtures that are obsolete or no longer used or useful in such Sotheby Entity’s business and having a book value not exceeding the Dollar Equivalent of $4,000,000 in the aggregate in any Fiscal Year; (c) the sale or other disposition of other assets having a book value not exceeding the Dollar Equivalent of $5,000,000 in the aggregate in any Fiscal Year; (d) the sale or other disposition of any asset by a Credit Party to any other Credit Party; (e) the sale or other disposition of any asset by any Sotheby Entity that is not a Credit Party to any other Sotheby Entity; (f) licenses or sublicenses granted to others in the ordinary course of business which do not (i) interfere in any material respect with the business of the Sotheby Entities or (ii) secure any Indebtedness; and (g) the disposition of any Specified U.K. Real Estate pursuant to a Permitted U.K. Real Estate Financing.

6.9

ERISA.

No Sotheby Entity shall, or shall cause or permit any ERISA Affiliate to, cause or permit to occur (i) an event that could result in the imposition of a Lien under Section 430 of the IRC or Section 303 or 4068 of ERISA or (ii) an ERISA Event to the extent such ERISA Event would reasonably be expected to result in taxes, penalties and other liabilities in an aggregate amount in excess of $5,000,000 in the aggregate.

6.10	Financial Covenants.

Borrowers shall not breach or fail to comply with any of the Financial Covenants.

6.11	Hazardous Materials.

No Sotheby Entity shall cause or permit a Release of any Hazardous Material on, at, in, under, above, to or from any of the Real Estate where such Release would (a) violate in any respect, or form the basis for any Environmental Liabilities under, any Environmental Laws or Environmental Permits, except as could not reasonably be expected to have a Material Adverse Effect or (b) otherwise materially adversely impact the value or marketability of any of the Real Estate or any of the Collateral.

6.12	Sale Leasebacks.

No Sotheby Entity shall engage in any sale leaseback, synthetic lease or similar transaction involving any of its assets, except any Permitted U.K. Real Estate Financing.

6.13	Restricted Payments.

No Sotheby Entity shall make any Restricted Payment, except:

(a) intercompany loans and advances between Sotheby Entities to the extent permitted by Sections 6.2 and 6.3;

(b) dividends and distributions by Subsidiaries of any Sotheby Entity paid to such Sotheby Entity;

(d) payments of principal and interest of intercompany loans and advances made in accordance with Section 6.3;

(e) if (i) no Event of Default has occurred and is continuing or would occur as a result thereof, (ii) either (A) so long as no Revolving Loans are outstanding hereunder and no “Revolving Loans” are outstanding under the SFS Revolving Credit Agreement as of the date of any Repurchase, both before and after giving effect thereto or (B) Parent has provided to the Administrative Agent, prior to the date that any Repurchase Period is announced (which notice shall be delivered to the Administrative Agent no earlier than thirty (30) days prior to the commencement of such Repurchase Period, and no later than

three (3) Business Days prior to the commencement of such Repurchase Period), a written notice setting forth (1) the proposed start and end dates of such Repurchase Period (which shall not exceed eighteen (18) months), (2) the aggregate maximum Dollar amount to be paid in consideration of all Repurchases to occur during such Repurchase Period, and (3) pro forma financial statements demonstrating that the Fixed Charge Coverage Ratio, calculated for the four Fiscal Quarter period which, as of the date of such notice to the Administrative Agent, is most recently completed and for which the Agents and Lenders have received Financial Statements pursuant hereto, shall be equal to or greater than 1.15 to 1.00 (calculated on a pro forma basis as if such aggregate maximum Dollar amount of Repurchases to occur during such Repurchase Period had occurred during such period), and (iii) after giving effect to each Repurchase, Margin Stock shall not constitute more than 25% of the assets of the Credit Parties, Parent may make Repurchases during such Repurchase Period; provided that, if clause (ii)(A) of this Section 6.13(e) is inapplicable, such Repurchases shall be conducted in accordance with the notice delivered pursuant to clause (ii)(B) of this Section 6.13(e);

(f) if no Event of Default has occurred and is continuing or would occur as a result thereof, Parent may make dividends or distributions on its Stock in an aggregate amount (the “Maximum Distribution Amount”) not to exceed, in any Fiscal Quarter, the lesser of (i) $0.15 per share of Stock and (ii) $13,400,000; provided that, if Parent shall have provided to the Administrative Agent prior to the date thereof pro forma financial statements demonstrating that the Fixed Charge Coverage Ratio, as of the end of the most recently completed Fiscal Quarter for which the Agents and Lenders have received Financial Statements pursuant hereto, shall be equal to or greater than the level specified in paragraph (b) of Annex G with respect to such Fiscal Quarter (calculated on a pro forma basis as if such dividend or distribution had occurred during such Fiscal Quarter; provided that to the extent such pro forma calculation would otherwise include dividends or distributions made by Parent in five Fiscal Quarters, such pro forma calculation shall only include dividends or distributions made by Parent in the four Fiscal Quarters in which the highest aggregate amount of dividends or distributions were made), Parent may make dividends or distributions on its Stock in excess of the Maximum Distribution Amount;

(g) on and after April 1, 2014, Parent may make Repurchases and pay other dividends or distributions on its Stock so long as, both before and after giving effect thereto, (i) no Event of Default has occurred and is continuing, (ii) the Aggregate Borrowing Availability equals or exceeds $75,000,000 and (iii) the Liquidity Amount equals or exceeds $150,000,000; provided that, if no Revolving Loans are outstanding hereunder and no “Revolving Loans” are outstanding under the SFS Revolving Credit Agreement, Parent may pay dividends or distributions on its Stock so long as, both before and after giving effect thereto, (i) no Event of Default has occurred and is continuing and (ii) the Liquidity Amount equals or exceeds $150,000,000;

(h) Parent may declare and make dividend payments or other distributions payable solely in its Stock;

(i) Parent may, from time to time on or prior to the fifth anniversary of the Closing Date, make Repurchases in an aggregate amount for all Repurchases made in reliance on this subsection (i) not to exceed $150,000,000, so long as (i) the aggregate amount of such Repurchases made during any Fiscal Year does not exceed $40,000,000 and (ii) both before and after giving effect to any such Repurchase, no Event of Default has occurred and is continuing; and

(j) on or prior to March 31, 2014, Parent may declare and make a special dividend or distribution on its Stock in an aggregate amount not to exceed $310,000,000, so long as, both before and after giving effect thereto, no Event of Default specified in Section 8.1(a)(i), 8.1(g) or 8.1(h) has occurred and is continuing.

6.14	Change of Corporate Name, State of Incorporation or Location; Change of Fiscal Year.

No Domestic Credit Party shall (a) change its name as it appears in official filings in the state of its incorporation or other organization, (b) change its chief executive office or principal place of business or the location of its records concerning the Collateral, (c) change the type of entity that it is, (d) change its organization identification number, if any, issued by its state of incorporation or other organization, or (e) change its jurisdiction of incorporation or organization or incorporate or organize in any additional jurisdictions, in each case, without at least thirty (30) days (or such shorter period as the Administrative Agent shall consent to in writing) prior written notice to the Administrative Agent and after the Administrative Agent’s written acknowledgment that any reasonable action requested by the Administrative Agent in connection therewith, including to continue the perfection of any Liens in favor of the Collateral Agent, on behalf of the Secured Parties, in any Collateral, has been completed or taken; provided, that any such new location shall be in the continental United States. No Foreign Borrower shall change its jurisdiction of incorporation or organization or incorporate or organize in any additional jurisdictions, in each case, without at least thirty (30) days (or such shorter period as the Administrative Agent shall consent to in writing) prior written notice to the Administrative Agent and after the Administrative Agent’s written acknowledgment that any reasonable action requested by the Administrative Agent in connection therewith, including to continue the perfection of any Liens in favor of the Collateral Agent, on behalf of the Secured Parties, in any Collateral, has been completed or taken. No Sotheby Entity shall change its Fiscal Year.

6.15	No Impairment of Intercompany Transfers.

No Sotheby Entity shall directly or indirectly enter into or become bound by any agreement, instrument, indenture or other obligation (other than this Agreement and the other Loan Documents) that could directly or indirectly restrict, prohibit or require the consent of any Person with respect to the payment of dividends or distributions or the making or repayment of intercompany loans by a Subsidiary of any Sotheby Entity to any Sotheby Entity or between Sotheby Entities.

6.16	Real Estate Purchases.

No Credit Party shall purchase or acquire or commit to purchase or acquire a fee simple or freehold ownership interest in real estate (a) with an aggregate purchase price in excess of the Dollar Equivalent of $50,000,000 or (b) that would cause the purchase prices of all such purchases by all Credit Parties since the Closing Date to exceed, in aggregate, the Dollar Equivalent of $100,000,000.

6.17	Changes Relating to Material Contracts.

No Sotheby Entity shall (a) change or amend the terms of the Senior Notes or the Senior Note Indenture in a manner materially adverse to the Lenders, (b) change or amend the terms of the Specified Senior Notes or the Specified Senior Note Indenture in a manner materially adverse to the Lenders, (c) change or amend any York Avenue Lease Document in a manner adverse to the interests of any Agent or any Lender in any material respect or (d) except as set forth on Disclosure Schedule (5.16), permit the York Avenue Lender to have recourse to Parent or any of its Subsidiaries, or any assets of Parent or any of its Subsidiaries, pursuant to the York Avenue Loan Agreement or any other York Avenue Loan Document; provided, that no change or amendment described in the foregoing clause (a) or (b) shall: (i) increase the interest rate on the Senior Notes or the Specified Senior Notes; (ii) accelerate the dates upon which payments of principal or interest are due under the Senior Notes or the Specified Senior Notes; (iii) increase the principal amount of the Senior Notes or the Specified Senior Notes above the original principal amount thereof; (iv) change any event of default, in a manner adverse to the Credit Parties, or add or make more restrictive any covenant with respect to the Senior Notes or the Specified Senior Notes or (v) change the redemption or prepayment provisions of the Senior Notes or the Specified Senior Notes.

6.18	Use of Proceeds.

No Sotheby Entity shall use any portion of the Loan proceeds, directly or indirectly, to purchase or carry Margin Stock (other than Stock of Parent, to the extent it constitutes Margin Stock, repurchased in accordance with Section 6.13) or repay or otherwise refinance Indebtedness of any Sotheby Entity or others incurred to purchase or carry Margin Stock. No Sotheby Entity shall own any Margin Stock (other than Stock of Parent, to the extent it constitutes Margin Stock, in an amount that does not exceed 25% of the assets of the Credit Parties).

7. TERM

7.1	Termination.

The financing arrangements contemplated hereby shall be in effect until the Commitment Termination Date, and the Loans and all other Obligations shall be automatically due and payable in full on such date.

7.2	Survival of Obligations Upon Termination of Financing Arrangements.

Except as otherwise expressly provided for in the Loan Documents, no termination or cancellation (regardless of cause or procedure) of any financing arrangement under this Agreement shall in any way affect or impair the obligations, duties and liabilities of the Credit Parties or the rights of the Agents, the Lenders and the Fronting Lender relating to any unpaid portion of the Loans or any other Obligations, due or not due, liquidated, contingent or unliquidated, or any transaction or event occurring prior to such termination, or any transaction or event, the performance of which is required after the Commitment Termination Date. Except as otherwise expressly provided herein or in any other Loan Document, all undertakings, agreements, covenants, warranties and representations of or binding upon the Credit Parties, and all rights of each Agent, each Lender and the Fronting Lender, all as contained in the Loan Documents, shall not terminate or expire, but rather shall survive any such termination or cancellation and shall continue in full force and effect until the Termination Date; provided, that the provisions of Section 11, the payment obligations under Sections 1.16 and 1.17, and the indemnities contained in the Loan Documents shall survive the Termination Date.

8. EVENTS OF DEFAULT; RIGHTS AND REMEDIES

8.1	Events of Default.

The occurrence of any one or more of the following events (regardless of the reason therefor) shall constitute an “Event of Default” hereunder:

(a) Any Borrower (i) fails to make any payment of principal of, or interest on, or Fees owing in respect of, the Loans or any of the other Obligations when due and payable, or (ii) fails to pay or reimburse any Agent or Lenders for any expense reimbursable hereunder or under any other Loan Document within ten (10) days following the Administrative Agent’s demand for such reimbursement or payment of expenses.

(b) Any Sotheby Entity fails or neglects to perform, keep or observe any of the provisions of Section 1.4, 1.9, 1.15, 5.4(a), 5.17 or 6, or any of the provisions set forth in Annex C or G, respectively.

(c) Any Borrower fails or neglects to perform, keep or observe any of the provisions of Section 4.1 or any provisions set forth in Annexes E or F, respectively, and the same shall remain unremedied for five (5) Business Days or more.

(d) Any Sotheby Entity fails or neglects to perform, keep or observe any other provision of this Agreement or of any of the other Loan Documents (other than any provision embodied in or covered by any other clause of this Section 8.1) and the same shall remain unremedied for twenty (20) days or more.

(e) A default or breach occurs under any Material Indebtedness Contract that is not cured within any applicable grace period therefor, and such default or breach (i) involves the failure to make any payment when due in respect of any Indebtedness or Guaranteed Indebtedness evidenced by such Material Indebtedness Contract, or (ii) causes, or permits any holder of Indebtedness or Guaranteed Indebtedness evidenced by such Material Indebtedness

Contract or a trustee to cause, Indebtedness or Guaranteed Indebtedness evidenced by such Material Indebtedness Contract to become due prior to its stated maturity or prior to its regularly scheduled dates of payment, or cash collateral in respect thereof to be demanded, in each case, regardless of whether such right is exercised, by such holder or trustee.

(f) Any information contained in any Borrowing Base Certificate is untrue or incorrect in any respect (other than (i) inadvertent, immaterial errors not exceeding $5,000,000 (or, if such inaccuracy results from a single error with respect to an individual Art Loan, individual item of Art Inventory or individual Extended Term Art Receivable, $10,000,000) in the aggregate in any Borrowing Base Certificate, (ii) errors understating either Borrowing Base or (iii) inadvertent errors occurring when Aggregate Borrowing Availability continues to exceed $15,000,000 after giving effect to the correction of such errors), or any representation or warranty herein or in any Loan Document or in any written statement, report, Financial Statement or certificate (other than a Borrowing Base Certificate) made or delivered to any Agent or any Lender by any Credit Party is untrue or incorrect in any material respect as of the date when made or deemed made.

(g) A case or proceeding is commenced against any Sotheby Entity (other than an Immaterial Subsidiary) seeking a decree or order in respect of such Sotheby Entity (i) under the Bankruptcy Code, or any other applicable federal, state or foreign bankruptcy or other similar law, (ii) appointing a custodian, receiver, administrator, liquidator, assignee, trustee or sequestrator (or similar official) for such Sotheby Entity or for any substantial part of any such Sotheby Entity’s assets, or (iii) ordering the winding up or liquidation of the affairs of such Sotheby Entity, and such case or proceeding shall remain undismissed or unstayed for sixty (60) days or more or a decree or order granting the relief sought in such case or proceeding is granted by a court of competent jurisdiction.

(h) Any Sotheby Entity (other than an Immaterial Subsidiary) (i) files a petition seeking relief under the Bankruptcy Code, or any other applicable federal, state or foreign bankruptcy or other similar law, (ii) consents to or fails to contest in a timely and appropriate manner the institution of proceedings thereunder or the filing of any such petition or the appointment of or taking possession by a custodian, receiver, administrator, liquidator, assignee, trustee or sequestrator (or similar official) for such Sotheby Entity or for any substantial part of any such Sotheby Entity’s assets, (iii) makes an assignment for the benefit of creditors, (iv) takes any action in furtherance of any of the foregoing; or (v) admits in writing its inability to, or is generally unable to, pay its debts as such debts become due.

(i) A final judgment or judgments for the payment of money in excess of a Dollar Equivalent of $20,000,000 in the aggregate at any time are outstanding against one or more of the Sotheby Entities (which judgments are not covered by insurance policies as to which liability has been accepted by the insurance carrier), and the same are not, within thirty (30) days (or, in the case of any Sotheby Entity that is not Parent, a Domestic Subsidiary or a Foreign Subsidiary organized under the laws of England, sixty (60) days) after the entry thereof, discharged or execution thereof stayed or bonded pending appeal, or such judgments are not discharged prior to the expiration of any such stay.

(j) Any material provision of any Loan Document for any reason ceases to be valid, binding and enforceable in accordance with its terms (or any Sotheby Entity shall challenge the enforceability of any Loan Document or shall assert in writing, or engage in any action or inaction based on any such assertion, that any provision of any of the Loan Documents has ceased to be or otherwise is not valid, binding and enforceable in accordance with its terms), or any Lien created under any Loan Document ceases to be a valid and perfected first priority Lien (except as otherwise permitted herein or therein) in any of the Collateral purported to be covered thereby.

(k) Any Change of Control occurs.

(l) Any Sotheby Entity or the York Avenue Owner violates any of the covenants contained in the York Avenue Loan Documents relating to the single purpose entity status of the York Avenue Owner or its corporate separateness from Parent and its Subsidiaries and such violation results in recourse liability to Parent or any Subsidiary thereof.

8.2

Remedies.

(a) If any Event of Default has occurred and is continuing, the Administrative Agent may (and at the written request of the Requisite Lenders shall), without notice, (i) suspend the Revolving Loan facility with respect to additional Advances and/or the incurrence of additional Letter of Credit Obligations, whereupon any additional Advances and additional Letter of Credit Obligations shall be made or incurred in the Administrative Agent’s sole discretion (or in the sole discretion of the Requisite Lenders, if such suspension occurred at their direction) so long as such Default or Event of Default is continuing; or (ii) reduce the Commitment from time to time.

(b) If any Event of Default has occurred and is continuing, any Agent may (and at the written request of the Requisite Lenders shall), without notice: (i) terminate the Revolving Loan facility with respect to further Advances or the incurrence of further Letter of Credit Obligations; (ii) reduce the Commitment from time to time; (iii) declare all or any portion of the Obligations, including all or any portion of any Loan, to be forthwith due and payable, and require that the Letter of Credit Obligations be cash collateralized in the manner set forth in Annex B, all without presentment, demand, protest or further notice of any kind, all of which are expressly waived by Borrowers and each other Credit Party; or (iv) exercise any rights and remedies provided to such Agent under the Loan Documents or at law or equity, including all remedies provided under the Code; provided, that upon the occurrence of an Event of Default specified in Sections 8.1(g) or (h), the Commitments shall be immediately terminated and all of the Obligations, including the aggregate Revolving Loan, shall become immediately due and payable without declaration, notice or demand by any Person.

8.3	Waivers by Credit Parties.

Except as otherwise provided for in this Agreement or by applicable law, each Credit Party waives (including for purposes of Section 12): (a) presentment, demand and protest and notice of presentment, dishonor, notice of intent to accelerate, notice of acceleration, protest, default, nonpayment, maturity, release, compromise, settlement, extension or renewal of any or

all Loan Documents, (b) all rights to notice and a hearing prior to any Agent’s taking possession or control of, or to any Agent’s replevy, attachment or levy upon, the Collateral or any bond or security that might be required by any court prior to allowing any Agent to exercise any of its remedies, except as may be required by applicable law, and (c) the benefit of all valuation, appraisal, marshaling and exemption laws.

9. ASSIGNMENT AND PARTICIPATIONS; APPOINTMENT OF AGENT

9.1	Assignment and Participations.

(a) Subject to the terms of this Section 9.1, any Lender may make an assignment to an assignee of, or sell participations in, at any time or times, the Loan Documents, the Loans, the Letter of Credit Obligations and any Commitment or any portion thereof or interest therein, including any Lender’s rights, title, interests, remedies, powers or duties thereunder. Any assignment by a Lender shall: (i) require the consent of the Administrative Agent (which consent shall not be required in the case of a Qualified Assignee and shall not be unreasonably withheld or delayed) and the execution of an assignment agreement (an “Assignment Agreement”) substantially in the form attached hereto as Exhibit 9.1(a) and otherwise in form and substance reasonably satisfactory to, and acknowledged by, the Administrative Agent; (ii) after giving effect to any such partial assignment, the assignee Lender shall have Commitments in an amount at least equal to $5,000,000 and the assigning Lender shall have retained Commitments in an amount at least equal to $5,000,000; (iii) include a payment to the Administrative Agent of an assignment fee of $3,500; (iv) be deemed to be an automatic assignment of a ratable interest in, and the assignee Lender shall be deemed to have been assigned a Pro Rata Share of the “Commitments” under, the SFS Revolving Credit Agreement and (v) so long as no Event of Default has occurred and is continuing, require the consent of Borrower Representative, which shall not be unreasonably withheld or delayed and shall be deemed to have been given unless an objection is delivered to the Administrative Agent within ten (10) Business Days after notice of such proposed assignment is delivered to Borrower Representative; provided that (x) no such consent shall be required for an assignment to a Qualified Assignee and (y) the Borrower Representative’s refusal to consent to an assignment to any Person that constitutes a vulture fund, distressed debt purchaser or similar institution whose primary business consists of purchasing or investing in Persons that are highly financially distressed and insolvent or imminently insolvent shall not be deemed to be unreasonable. No Agent shall have any responsibility for ensuring that minimum Commitment amounts described in clause (ii) of the immediately preceding sentence are maintained or for determining whether an assignee of any Lender is a Qualified Assignee. In addition, no Agent shall have any liability in the event any Loans or Commitments (or any interest therein) are assigned to a Qualified Assignee without the consent of the Borrower Representative. Lenders shall be required at all times to maintain equal Pro Rata Shares of the Commitments hereunder and the “Commitments” under the SFS Revolving Credit Facility. Notwithstanding anything herein to the contrary, no Lender may assign or otherwise transfer all or any part of its interest in the Obligations to any natural person or to any Borrower or any of its Affiliates. The Agents’ refusal to consent to an assignment by a Non-Funding Lender who is a Non-Funding Lender due to clause (a) of the definition of Non-Funding Lender (unless in connection with such assignment, such Non-Funding Lender cures, or causes the cure of, its Non-Funding Lender status as contemplated in Section 9.9(d)(v)) shall not be deemed to be unreasonable. The Agents’ refusal to consent to an

assignment by any Lender to any Person that would be a Non-Funding Lender or an Impacted Lender, or the imposition of conditions or limitations (including limitations on voting) upon assignments to such Persons, shall not be deemed to be unreasonable. In the case of an assignment by a Lender under this Section 9.1, the assignee shall have, to the extent of such assignment, the same rights, benefits and obligations as all other Lenders hereunder. The assigning Lender shall be relieved of its obligations hereunder with respect to its Commitments or assigned portion thereof from and after the date of such assignment. Each Borrower hereby acknowledges and agrees that any assignment shall give rise to a direct obligation of Borrowers to the assignee and that the assignee shall be considered to be a “Lender”. In all instances, each Lender’s liability to make Loans or purchase participation interests therein hereunder shall be several and not joint and shall be limited to such Lender’s Pro Rata Share of the applicable Commitment. In the event any Agent or any Lender assigns or otherwise transfers all or any part of its interest in the Obligations, any such Agent or any such Lender shall so notify Borrowers and Borrowers shall, upon the request of such Agent or such Lender, execute new Notes in exchange for the Notes, if any, being assigned. Notwithstanding the foregoing provisions of this Section 9.1(a), any Lender may at any time pledge its interest in the Obligations and such Lender’s rights under this Agreement and the other Loan Documents to a Federal Reserve Bank, and any Lender that is an investment fund may assign its interest in the Obligations and such Lender’s rights under this Agreement and the other Loan Documents to another investment fund managed by the same investment advisor; provided, that no such pledge to a Federal Reserve Bank shall release such Lender from such Lender’s obligations hereunder or under any other Loan Document.

(b) The Administrative Agent, acting solely for this purpose as a non-fiduciary agent of the Borrowers, shall maintain at its address referred to in Annex I a copy of each Assignment Agreement delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Commitments of, and principal amounts (and stated interest) of the Loans owing to, each Lender pursuant to the terms hereof from time to time (the “Register”). The entries in the Register shall be conclusive absent manifest error, and Borrowers, the Agents and Lenders shall treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement. The Register shall be available for inspection by the Borrower and any Lender, at any reasonable time and from time to time upon reasonable prior notice.

(c) Any participation by a Lender of all or any part of its Commitments shall be made with the understanding that all amounts payable by Borrowers hereunder shall be determined as if that Lender had not sold such participation, and that the holder of any such participation shall not be entitled to require such Lender to take or omit to take any action hereunder except actions directly affecting (i) any reduction in the principal amount of, or interest rate or Fees payable with respect to, any Loan in which such holder participates, (ii) any extension of the scheduled amortization of the principal amount of any Loan in which such holder participates or the final maturity date thereof, and (iii) any release of the Collateral Agent’s Lien on all or substantially all of the Collateral (other than in accordance with the terms of this Agreement, the Collateral Documents or the other Loan Documents). Each of the Borrowers agrees that each participant shall be entitled to the benefits of Sections 1.14, 1.16 (as it applied in relation to US tax only), 1.17 and 9.8 (subject to the requirements and limitations therein, including the requirements under Section 1.16 (it being understood that the

documentation required in order to constitute a Qualifying Lender and the documentation required under Section 1.16 shall be delivered to the participating Lender)) to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to paragraph (a) of this Section; provided that such participant shall not be entitled to receive any greater payment under Section 1.16, with respect to any participation, than its participating Lender would have been entitled to receive. Except as set forth in the preceding sentence no Credit Party shall have any obligation or duty to any participant. Neither any Agent nor any Lender (other than the Lender selling a participation) shall have any duty to any participant and may continue to deal solely with the Lender selling a participation as if no such sale had occurred.

(d) Each Lender that sells a participation shall, acting solely for this purpose as a non-fiduciary agent of Borrowers, maintain a register on which it enters the name and address of each participant and the principal amounts (and stated interest) of each participant’s interest in the Loans or other obligations under the Loan Documents (the “Participant Register”); provided that no Lender shall have any obligation to disclose all or any portion of the Participant Register (including the identity of any participant or any information relating to a participant’s interest in any commitments, loans, letters of credit or its other obligations under any Loan Document) to any Person other than the Administrative Agent except to the extent that such disclosure is necessary to establish that such commitment, loan, letter of credit or other obligation is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations. The entries in the Participant Register shall be conclusive absent manifest error, and such Lender shall treat each Person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary. For the avoidance of doubt, no Agent shall have any responsibility for maintaining a Participant Register.

(e) Except as expressly provided in this Section 9.1, no Lender shall, as between Borrowers and that Lender, or the Agents and that Lender, be relieved of any of its obligations hereunder as a result of any sale, assignment, transfer or negotiation of, or granting of participation in, all or any part of the Loans, the Notes or other Obligations owed to such Lender.

(f) Each Credit Party shall assist any Lender permitted to sell assignments or participations under this Section 9.1 as reasonably required to enable the assigning or selling Lender to effect any such assignment or participation, including the execution and delivery of any and all agreements, notes and other documents and instruments as shall be requested and, if requested by the Administrative Agent, the preparation of informational materials for, and the participation of management in meetings with, potential assignees or participants. Each Credit Party shall certify the correctness, completeness and accuracy of all descriptions of the Sotheby Entities and their respective affairs contained in any selling materials provided by them and all other information provided by them and included in such materials, except that the Projections shall only be certified by Borrowers as having been prepared by Borrowers in compliance with the representations contained in Section 3.4(b).

(g) Any Lender may furnish any information concerning Sotheby Entities in the possession of such Lender from time to time to assignees and participants (including prospective assignees and participants); provided that such Lender shall obtain from assignees or participants confidentiality covenants substantially equivalent to those contained in Section 11.8.

(h) So long as no Event of Default has occurred and is continuing, no Lender shall assign or sell participations in any portion of its Loans or Commitment to a potential Lender or participant, if, as of the date of the proposed assignment or sale, the assignee Lender or participant would be subject to capital adequacy or similar requirements under Section 1.17(a), increased costs under Section 1.17(b), an inability to fund LIBOR Loans under Section 1.17(c), or withholding taxes in accordance with Section 1.16(a).

(i) Notwithstanding anything to the contrary contained herein, any Lender (a “Granting Lender”), may grant to a special purpose funding vehicle (an “SPC”), identified as such in writing by the Granting Lender to the Administrative Agent and Borrowers, the option to provide to Borrowers all or any part of any Loans that such Granting Lender would otherwise be obligated to make to Borrowers pursuant to this Agreement; provided that (i) nothing herein shall constitute a commitment by any SPC to make any Loan; and (ii) if an SPC elects not to exercise such option or otherwise fails to provide all or any part of such Loan, the Granting Lender shall be obligated to make such Loan pursuant to the terms hereof. The making of a Loan by an SPC hereunder shall utilize the Commitment of the Granting Lender to the same extent, and as if such Loan were made by such Granting Lender. No SPC shall be liable for any indemnity or similar payment obligation under this Agreement (all liability for which shall remain with the Granting Lender). Any SPC may (i) with notice to, but without the prior written consent of, Borrowers and the Administrative Agent and without paying any processing fee therefor assign all or a portion of its interests in any Loans to the Granting Lender or to any financial institutions (consented to by Borrowers and the Administrative Agent) providing liquidity and/or credit support to or for the account of such SPC to support the funding or maintenance of Loans and (ii) disclose on a confidential basis any non-public information relating to its Loans to any rating agency, commercial paper dealer or provider of any surety, guarantee or credit or liquidity enhancement to such SPC. This Section 9.1(i) may not be amended without the prior written consent of each Granting Lender, all or any of whose Loans are being funded by an SPC at the time of such amendment. For the avoidance of doubt, the Granting Lender shall for all purposes, including without limitation, the approval of any amendment or waiver of any provision of any Loan Document or the obligation to pay any amount otherwise payable by the Granting Lender under the Loan Documents, continue to be the Lender of record hereunder.

(j) In the case of an assignment by a Non-Foreign Currency Lender to a Foreign Currency Lender of any interest in the Revolving Loan Outstandings, such Foreign Currency Lender shall purchase the portion of the Revolving Loan outstanding to the Fronting Lender to the extent of the participation interest therein of such Non-Foreign Currency Lender making such assignment for a purchase price, in the applicable Foreign Currencies, equal to such outstanding amount, and the Fronting Lender shall pay the Dollar Equivalent as of such date of such amount to such Non-Foreign Currency Lender in payment of such participation interest. In the case of an assignment by a Foreign Currency Lender to a Non-Foreign Currency Lender of any interest in the Revolving Loan Outstandings, the Fronting Lender shall purchase the portion of the Revolving Loan outstanding to such Foreign Currency Lender which is subject to such assignment, and such Non-Foreign Currency Lender shall purchase an undivided participation interest in the Revolving Loan Outstandings from the Fronting Lender for a purchase price in Dollars equal to the Dollar Equivalent as of such date of such portion assigned.

(k) Any Non-Foreign Currency Lender may become a Foreign Currency Lender hereunder upon delivery of notice to the Administrative Agent, the Fronting Lender and the Borrower Representative. Upon delivery of such notice by such Lender, without any further action whatsoever (i) such Lender shall be deemed to have purchased from the Fronting Lender a portion of the Revolving Loan Outstandings held by the Fronting Lender equal to such Lender’s participation interests therein, (ii) the Fronting Lender shall be deemed to have repaid such participation interests to such Lender and shall have no further obligations to such Lender hereunder, (iii) such Lender shall constitute a Foreign Currency Lender for all purposes hereunder, including, without limitation, the Commitment to make Foreign Currency Revolving Credit Advances pursuant to Section 1.1(a)(i) and (iv) the Fronted Percentage, and the obligation of the Fronting Lender to make Foreign Currency Revolving Credit Advances pursuant to Section 1.1(a)(i), shall be reduced accordingly.

9.2	Appointment of the Administrative Agent and the Collateral Agent.

GE Capital is hereby appointed to act on behalf of all Lenders and the Fronting Lender as the Administrative Agent and the Collateral Agent under this Agreement and the other Loan Documents. The provisions of this Section 9.2 are solely for the benefit of the Agents, the Lenders and the Fronting Lender and no Sotheby Entity nor any other Person shall have any rights as a third party beneficiary of any of the provisions hereof. In performing its functions and duties under this Agreement and the other Loan Documents, each Agent shall act solely as an agent of Lenders and the Fronting Lender and does not assume and shall not be deemed to have assumed any obligation toward or relationship of agency or trust with or for any Sotheby Entity or any other Person. Each Agent shall have no duties or responsibilities except for those expressly set forth in this Agreement and the other Loan Documents. Except as expressly set forth in the Foreign Collateral Documents, the duties of each Agent shall be mechanical and administrative in nature and no Agent shall have, or be deemed to have, by reason of this Agreement, any other Loan Document or otherwise a fiduciary relationship in respect of any Lender or the Fronting Lender. Except as expressly set forth in this Agreement and the other Loan Documents, no Agent shall have any duty to disclose, and shall not be liable for failure to disclose, any information relating to any Sotheby Entity or any of their respective Subsidiaries or any Account Debtor that is communicated to or obtained by GE Capital or any of its Affiliates in any capacity. Neither any Agent nor any of its Affiliates nor any of their respective officers, directors, employees, agents or representatives shall be liable to any Lender or the Fronting Lender for any action taken or omitted to be taken by it hereunder or under any other Loan Document, or in connection herewith or therewith, except for damages caused by its or their own gross negligence or willful misconduct as determined in a final, non-appealable judgment by a court of competent jurisdiction.

If any Agent shall request instructions from Requisite Lenders, Supermajority Lenders or all affected Lenders with respect to any act or action (including failure to act) in connection with this Agreement or any other Loan Document, then such Agent shall be entitled to refrain from such act or taking such action unless and until such Agent shall have received instructions from Requisite Lenders, Supermajority Lenders or all affected Lenders, as the case may be, and such Agent shall not incur liability to any Person by reason of so refraining. Each Agent shall be fully justified in failing or refusing to take any action hereunder or under any other Loan Document (a) if such action would, in the opinion of such Agent, be contrary to law

or the terms of this Agreement or any other Loan Document, (b) if such action would, in the opinion of such Agent, expose such Agent to Environmental Liabilities or (c) if such Agent shall not first be indemnified to its satisfaction against any and all liability and expense which may be incurred by it by reason of taking or continuing to take any such action. Without limiting the foregoing, no Lender or the Fronting Lender shall have any right of action whatsoever against any Agent as a result of any Agent acting or refraining from acting hereunder or under any other Loan Document in accordance with the instructions of Requisite Lenders, Supermajority Lenders or all affected Lenders, as applicable.

In its capacity, the Collateral Agent is a “representative” of the Secured Parties within the meaning of the term “secured party” as defined in the UCC. Each Lender and the Administrative Agent authorizes the Collateral Agent to enter into each of the Collateral Documents to which it is a party and to take all action contemplated by such documents in accordance with the terms thereof. Subject to Section 9.8, each Lender agrees that no Secured Party (other than the Collateral Agent) shall have the right individually to seek to realize upon the security granted by any Collateral Document, it being understood and agreed that such rights and remedies may be exercised solely by the Collateral Agent for the benefit of the Secured Parties upon the terms of the Collateral Documents. In the event that any Collateral is hereafter pledged by any Person as collateral security for the Secured Obligations, the Collateral Agent is hereby authorized, and hereby granted a power of attorney, to execute and deliver on behalf of the Secured Parties any Loan Documents necessary or appropriate to grant and perfect a Lien on such Collateral in favor of the Collateral Agent on behalf of the Secured Parties.

9.3	Agents’ Reliance, Etc.

Neither any Agent nor any of its Affiliates nor any of their respective directors, officers, agents or employees shall be liable for any action taken or omitted to be taken by it or them under or in connection with this Agreement or the other Loan Documents, except for damages caused by its or their own gross negligence or willful misconduct as determined in a final, non-appealable judgment by a court of competent jurisdiction. Without limiting the generality of the foregoing, each Agent: (a) may treat the payee of any Note as the holder thereof until such Agent receives written notice of the assignment or transfer thereof signed by such payee and in form reasonably satisfactory to such Agent; (b) may consult with legal counsel, independent public accountants and other experts selected by it and shall not be liable for any action taken or omitted to be taken by it in good faith in accordance with the advice of such counsel, accountants or experts; (c) makes no warranty or representation to any Lender and shall not be responsible to any Lender for any statements, warranties or representations made in or in connection with this Agreement or the other Loan Documents; (d) shall not have any duty to ascertain or to inquire as to the performance or observance of any of the terms, covenants or conditions of this Agreement or the other Loan Documents on the part of any Credit Party or to inspect the Collateral (including the books and records) of any Credit Party; (e) shall not be responsible to any Lender for the due execution, legality, validity, enforceability, genuineness, sufficiency or value of this Agreement or the other Loan Documents or any other instrument or document furnished pursuant hereto or thereto; and (f) shall incur no liability under or in respect of this Agreement or the other Loan Documents by acting upon any notice, consent, certificate or other instrument or writing (which may be by telecopy, telegram, cable or telex) believed by it to be genuine and signed or sent by the proper party or parties.

9.4	GE Capital and Affiliates.

With respect to its Commitments hereunder, GE Capital shall have the same rights and powers under this Agreement and the other Loan Documents as any other Lender and may exercise the same as though it were not an Agent; and the term “Lender” or “Lenders” shall, unless otherwise expressly indicated, include GE Capital in its individual capacity. GE Capital and its Affiliates may lend money to, invest in, and generally engage in any kind of business with, any Sotheby Entity, any of their Affiliates and any Person who may do business with or own securities of any Sotheby Entity or any such Affiliate, all as if GE Capital were not an Agent and without any duty to account therefor to Lenders. GE Capital and its Affiliates may accept fees and other consideration from any Sotheby Entity for services in connection with this Agreement or otherwise without having to account for the same to Lenders. Each Lender acknowledges the potential conflict of interest between GE Capital as a Lender holding disproportionate interests in the Loans and GE Capital as the Administrative Agent and the Collateral Agent.

9.5	Lender Credit Decision.

Each Lender acknowledges that it has, independently and without reliance upon any Agent or any other Lender and based on the Financial Statements referred to in Section 3.4(a) and such other documents and information as it has deemed appropriate, made its own credit and financial analysis of the Sotheby Entities and its own decision to enter into this Agreement. Each Lender also acknowledges that it will, independently and without reliance upon any Agent or any other Lender and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under this Agreement. Each Lender acknowledges the potential conflict of interest of each other Lender as a result of Lenders holding disproportionate interests in the Loans, and expressly consents to, and waives any claim based upon, such conflict of interest.

9.6	Indemnification.

Lenders agree to indemnify the Agents (to the extent not reimbursed by Credit Parties and without limiting the obligations of Credit Parties hereunder), ratably according to their respective Pro Rata Shares, from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever that may be imposed on, incurred by, or asserted against any Agent in any way relating to or arising out of this Agreement or any other Loan Document or any action taken or omitted to be taken by any Agent in connection therewith; provided, that no Lender shall be liable to any Agent for any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements resulting from such Agent’s gross negligence or willful misconduct as determined in a final, non-appealable judgment by a court of competent jurisdiction. Without limiting the foregoing, each Lender agrees to reimburse the Agents promptly upon demand for its ratable share of any out-of-pocket expenses (including reasonable counsel fees) incurred by any Agent in connection with the preparation, execution, delivery, administration, modification, amendment or enforcement (whether through negotiations, legal proceedings or otherwise) of, or legal advice in respect of rights or

responsibilities under, this Agreement and each other Loan Document, to the extent that any such Agent is not reimbursed for such expenses by Credit Parties.

9.7	Successor Agents and Fronting Lender.

(a) Any Agent may resign at any time by giving not less than thirty (30) days’ prior written notice thereof to Lenders and Borrower Representative. Upon any such resignation, the Requisite Lenders shall have the right to appoint a successor Agent. If no successor Agent shall have been so appointed by the Requisite Lenders and shall have accepted such appointment within thirty (30) days after the resigning Agent’s giving notice of resignation, then the resigning Agent may, on behalf of Lenders, appoint a successor Agent, which shall be a Lender (if a Lender is willing to accept such appointment), or otherwise shall be a commercial bank or financial institution or a subsidiary of a commercial bank or financial institution if such commercial bank or financial institution is organized under the laws of the United States of America or of any State thereof and has a combined capital and surplus of at least $300,000,000. If no successor Agent has been appointed pursuant to the foregoing, within thirty (30) days after the date such notice of resignation was given by the resigning Agent, such resignation shall become effective and the Requisite Lenders shall thereafter perform all the duties of such Agent, hereunder until such time, if any, as the Requisite Lenders appoint a successor Agent as provided above. Any successor Agent appointed by Requisite Lenders hereunder shall be subject to the approval of Borrower Representative, such approval not to be unreasonably withheld or delayed; provided that such approval shall not be required if a Default or an Event of Default has occurred and is continuing. Upon the acceptance of any appointment as Administrative Agent or Collateral Agent, as applicable, hereunder by a successor Agent, such successor Agent shall succeed to and become vested with all the rights, powers, privileges and duties of the resigning Agent. Upon the earlier of the acceptance of any appointment as Administrative Agent or Collateral Agent, as applicable, hereunder by a successor Agent or the effective date of the resigning Agent’s resignation, the resigning Agent shall be discharged from its duties and obligations under this Agreement and the other Loan Documents, except that any indemnity rights or other rights in favor of such resigning Agent shall continue. After any resigning Agent’s resignation hereunder, the provisions of this Section 9 shall inure to its benefit as to any actions taken or omitted to be taken by it while it was acting as Administrative Agent or Collateral Agent, as applicable, under this Agreement and the other Loan Documents.

(b) The Fronting Lender may resign at any time by giving sixty (60) days prior written notice thereof to the Administrative Agent, the Non-Foreign Currency Lenders and the Borrowers; provided, such resignation shall not become effective until the date upon which a replacement Fronting Lender reasonably acceptable to the Administrative Agent and Non-Foreign Currency Lenders having aggregate Commitments equal to greater than 50% of the Fronted Percentage and, so long as no Default or Event of Default has occurred and is continuing, to the Borrowers, has been selected and has assumed the rights and obligations of a Fronting Lender hereunder. If no successor Fronting Lender shall have been so appointed and shall have accepted such appointment within thirty (30) days after the resigning Fronting Lender’s giving of notice of resignation, then the resigning Fronting Lender may, on behalf of the Non-Foreign Currency Lenders, appoint a successor Fronting Lender, which shall be a financial institution having a rating of not less than A or its equivalent by Standard & Poor’s, and having otherwise the ability to fund the Foreign Currency Revolving Credit Advances (and the

parties hereto agree to use reasonable efforts to appoint a successor Fronting Lender which will not cause an increase in the tax withholding liability for the Borrowers). Upon the acceptance of any appointment as Fronting Lender hereunder by a successor Fronting Lender, such successor Fronting Lender shall thereupon succeed to and become vested with all the rights, powers, privileges, duties and obligations of the resigning Fronting Lender, and the resigning Fronting Lender shall be discharged from its duties and obligations hereunder. After any resigning Fronting Lender’s resignation, the provisions of this Agreement and the other Loan Documents shall continue in effect for its benefit in respect of any actions taken or omitted to be taken by it while it was acting as Fronting Lender.

9.8	Setoff and Sharing of Payments.

In addition to any rights now or hereafter granted under applicable law and not by way of limitation of any such rights, upon the occurrence and during the continuance of any Event of Default and subject to Section 9.9(g), each Lender is hereby authorized at any time or from time to time, without prior notice to any Credit Party or to any Person other than the Agents, any such notice being hereby expressly waived, to offset and to appropriate and to apply any and all balances held by it at any of its offices for the account of any Credit Party (regardless of whether such balances are then due to such Credit Party) and any other properties or assets at any time held or owing by that Lender or that holder to or for the credit or for the account of any Credit Party against and on account of any of the Obligations that are not paid when due; provided, that (i) the Lender exercising such offset rights shall give notice thereof to the affected Credit Party promptly after exercising such rights, and (ii) any balances, properties or assets of a Foreign Credit Party shall be offset, appropriated or applied only to or against the Obligations of the Foreign Credit Parties. Any Lender exercising a right of setoff or otherwise receiving any payment on account of the Obligations in excess of its Pro Rata Share thereof shall purchase for cash (and the other Lenders or holders shall sell) such participations in each such other Lender’s or holder’s Pro Rata Share of the Obligations as would be necessary to cause such Lender to share the amount so offset or otherwise received with each other Lender or holder in accordance with their respective Pro Rata Shares (other than offset rights exercised by any Lender with respect to Sections 1.14, 1.16 or 1.17). Each Lender’s obligation under this Section 9.8 shall be in addition to and not in limitation of its obligations to purchase a participation in an amount equal to its Pro Rata Share of the Swing Line Loan under Section 1.1. Each Credit Party agrees, to the fullest extent permitted by law, that (a) any Lender may exercise its right to offset with respect to amounts in excess of its Pro Rata Share of the Obligations and may sell participations in such amounts so offset to other Lenders and holders and (b) any Lender so purchasing a participation in the Loans made or other Obligations held by other Lenders or holders may exercise all rights of offset, bankers’ lien, counterclaim or similar rights with respect to such participation as fully as if such Lender or holder were a direct holder of the Loans and the other Obligations in the amount of such participation. Notwithstanding the foregoing, if all or any portion of the offset amount or payment otherwise received is thereafter recovered from the Lender that has exercised the right of offset, the purchase of participations by that Lender shall be rescinded and the purchase price restored without interest. If a Non-Funding Lender receives any payment described in the second sentence of this Section 9.8, such Lender shall turn over such payments to the Collateral Agent in an amount that would satisfy the cash collateral requirements set forth in Section 9.9(d).

9.9	Advances; Payments; Non-Funding Lenders; Information; Actions in Concert.

(a) Revolving Credit Advances; Payments.

(i) Lenders shall refund or participate in the Swing Line Loan in accordance with clauses (iii), (iv) and (v) of Section 1.1(b). If (i) the Swing Line Lender declines to make a Swing Line Advance, (ii) Swing Line Availability is zero or (iii) the Administrative Agent shall receive a Notice of Revolving Credit Advance in respect of a Revolving Credit Advance to be made as a LIBOR Loan, the Administrative Agent shall notify Lenders, promptly after receipt of a Notice of Revolving Credit Advance and in any event prior to 1:00 p.m. (New York time) on the date such Notice of Revolving Credit Advance is received, by telecopy, telephone or other similar form of transmission.

(ii) In the case of any Revolving Credit Advance to be denominated in Dollars, each Lender shall make the amount of such Lender’s Pro Rata Share of such Revolving Credit Advance available to the Administrative Agent in same day funds in Dollars by wire transfer to the Administrative Agent’s account as set forth in Annex H not later than 3:00 p.m. (New York time) on the requested funding date, in the case of an Index Rate Loan, and not later than 11:00 a.m. (New York time) on the requested funding date, in the case of a LIBOR Loan. In the case of any Revolving Credit Advance to be denominated in any Foreign Currency, each Foreign Currency Lender and the Fronting Lender shall make the amount of such Lender’s Pro Rata Share (or, in the case of the Fronting Lender, the Fronted Percentage) of such Revolving Credit Advance available to the Administrative Agent in same day funds in such Foreign Currency by wire transfer to the Administrative Agent’s account as set forth in Annex H not later than 3:00 p.m. (New York time) on the requested funding date, in the case of an Index Rate Loan, and not later than 11:00 a.m. (New York time) on the requested funding date, in the case of a LIBOR Loan. After receipt of such wire transfers (or, in the Administrative Agent’s sole discretion, before receipt of such wire transfers), subject to the terms hereof, the Administrative Agent shall make the requested Revolving Credit Advance to Borrower. All payments by each Lender pursuant to this Section 9.9(a) shall be made without setoff, counterclaim or deduction of any kind.

(iii) On each Business Day (each, a “Settlement Date”), the Administrative Agent shall advise each Lender and the Fronting Lender by telephone or telecopy of the amount to be disbursed to such Person in accordance with this Section 9.9(a)(iii). Provided that each Lender has funded all payments or Advances required to be made by it and has purchased all participations required to be purchased by it under this Agreement and the other Loan Documents as of such Settlement Date, the Administrative Agent shall pay to each Lender and the Fronting Lender (i) in the case of any Foreign Currency Lender, such Lender’s Pro Rata Share of principal, interest and Fees received by the Administrative Agent from the Borrowers on such Settlement Date (or, in the case of amounts denominated in a Foreign Currency, (x) with respect to principal, on the date one Business Day prior to such Settlement Date and (y) with respect to all other amounts, on the date two Business Days prior to such Settlement Date) (as determined in accordance with Section 1.11) for the benefit of Lenders with respect to each applicable Loan, (ii) in the case of any Non-Foreign Currency Lender, (A) such Lender’s Pro Rata Share of principal and interest received by the Administrative Agent from the

Borrowers on such Settlement Date (as determined in accordance with Section 1.11) for the benefit of Lenders with respect to the portion of the Revolving Loan Outstanding denominated in Dollars, (B) its Pro Rata Share of Fees (other than Letter of Credit Fees denominated in a Foreign Currency) received by the Administrative Agent from the Borrowers on such Settlement Date (as determined in accordance with Section 1.11) for the benefit of Lenders and (C) an amount in Dollars equal to the Dollar Equivalent (calculated as of such Settlement Date) of its Pro Rata Share of Letter of Credit Fees denominated in a Foreign Currency received by the Administrative Agent from the Borrowers on the second Business Day preceding such Settlement Date; and (iii) in the case of the Fronting Lender, the Fronted Percentage of principal and interest received by the Administrative Agent from the Borrowers (A) with respect to principal, on the date one Business Day prior to such Settlement Date and (B) with respect to all other amounts, on the date two Business Days prior to such Settlement Date (as determined in accordance with Section 1.11) for the benefit of the Lenders and the Fronting Lender with respect to the portion of the Revolving Loan Outstandings denominated in any Foreign Currency. Such payments shall be made by wire transfer to such Lender’s or the Fronting Lender’s account (as specified by such Lender in Annex H or the applicable Assignment Agreement) not later than 5:00 p.m. (New York time) on each Settlement Date.

(b) Availability of Lender’s Pro Rata Share. The Administrative Agent may assume that each Lender and the Fronting Lender will make its Pro Rata Share or the Fronted Percentage, as applicable, of each Revolving Credit Advance available to the Administrative Agent on each funding date. If such Pro Rata Share or the Fronted Percentage, as applicable, is not, in fact, paid to the Administrative Agent by such Lender when due, the Administrative Agent will be entitled to recover such amount on demand from such Lender or the Fronting Lender, as applicable, without setoff, counterclaim or deduction of any kind. If any Lender or the Fronting Lender fails to pay the amount of its Pro Rata Share or the Fronted Percentage forthwith upon the Administrative Agent’s demand, the Administrative Agent shall promptly notify Borrower Representative and Borrowers shall immediately repay such amount to the Administrative Agent. Nothing in this Section 9.9(b) or elsewhere in this Agreement or the other Loan Documents shall be deemed to require any Agent to advance funds on behalf of any Lender or the Fronting Lender or to relieve any Lender or the Fronting Lender from its obligation to fulfill its Commitments or obligations hereunder or to prejudice any rights that Borrowers may have against any Lender or the Fronting Lender as a result of any default by such Lender or the Fronting Lender hereunder. To the extent that any Agent advances funds to any Borrower on behalf of any Lender or the Fronting Lender and is not reimbursed therefor on the same Business Day as such Advance is made, such Agent shall be entitled to retain for its account all interest accrued on such Advance until reimbursed by the applicable Lender or the Fronting Lender, as applicable.

(i) If any Agent pays an amount to a Lender or the Fronting Lender under this Agreement in the belief or expectation that a related payment has been or will be received by such Agent from Borrowers and such related payment is not received by such Agent, then such Agent will be entitled to recover such amount from such Lender or the Fronting Lender, as applicable, on demand without setoff, counterclaim or deduction of any kind.

(ii) If any Agent determines at any time that any amount received by such Agent under this Agreement must be returned to any Borrower or paid to any other Person pursuant to any insolvency law or otherwise, then, notwithstanding any other term or condition of this Agreement or any other Loan Document, such Agent will not be required to distribute any portion thereof to any Lender or the Fronting Lender. In addition, each Lender and the Fronting Lender will repay to each Agent on demand any portion of such amount that such Agent has distributed to such Lender or the Fronting Lender, together with interest at such rate, if any, as such Agent is required to pay to any Borrower or such other Person, without setoff, counterclaim or deduction of any kind.

(iii) If the Fronting Lender pays an amount to a Non-Foreign Currency Lender under this Agreement in the belief or expectation that a related payment has been or will be received by the Fronting Lender from any Agent and such related payment is not received by the Fronting Lender, then the Fronting Lender will be entitled to recover such amount from such Non-Foreign Currency Lender on demand without setoff, counterclaim or deduction of any kind.

(iv) If the Fronting Lender determines at any time that any amount received by the Fronting Lender under this Agreement must be returned to any Borrower or paid to any other Person pursuant to any insolvency law or otherwise (or paid to any Agent pursuant to paragraph (ii) above), then, notwithstanding any other term or condition of this Agreement or any other Loan Document, the Fronting Lender will not be required to distribute any portion thereof to any Non-Foreign Currency Lender. In addition, each Non-Foreign Currency Lender will repay to the Fronting Lender on demand any portion of such amount that the Fronting Lender has distributed to such Non-Foreign Currency Lender, together with interest at such rate, if any, as the Fronting Lender is required to pay to any Borrower, any such other Person or any Agent, without setoff, counterclaim or deduction of any kind.

(d) Non-Funding Lenders.

(i) Responsibility. The failure of any Non-Funding Lender to make any Revolving Credit Advance, Letter of Credit Obligation or any payment required by it, or to make any payment required by it hereunder, or to fund any purchase of any participation to be made or funded by it on the date specified therefor shall not relieve any other Lender (each such other Lender, an “Other Lender”) of its obligations to make such loan, fund the purchase of any such participation, or make any other payment required hereunder on such date, and neither any Agent nor, other than as expressly set forth herein, any other Lender shall be responsible for the failure of any Non-Funding Lender to make a loan, fund the purchase of a participation or make any other payment required hereunder.

(ii) Reallocation. If any Lender is a Non-Funding Lender, all or a portion of such Non-Funding Lender’s Letter of Credit Obligations (unless such Lender is the L/C Issuer that issued such Letter of Credit), reimbursement obligations with respect to Swing Loans and, as applicable, participation funding obligations under Section 9.9(e)(i) shall, at the Administrative Agent’s election at any time or upon any L/C Issuer’s, the Swing Line Lender’s or the Fronting Lender’s written request delivered to the Administrative Agent (whether before or after the occurrence of any Default or Event of Default), be reallocated to and assumed or funded by the Lenders that are not Non-Funding Lenders or Impacted Lenders pro rata in

accordance with their Pro Rata Shares of the aggregate Commitments of all Lenders (calculated as if the Non-Funding Lender’s Pro Rata Share was reduced to zero and each other Lender’s Pro Rata Share had been increased proportionately); provided, that no Lender shall be reallocated any such amounts or be required to fund any amounts that would cause the sum of its outstanding Revolving Credit Advances, outstanding Letter of Credit Obligations, amounts of its participations in Swing Line Advances, its pro rata share of unparticipated amounts in Swing Line Advances and amounts of its participations pursuant to Section 9.9(e)(i) to exceed its Commitment. Upon any such reallocation of a participation funding obligation under Section 9.9(e)(i) to a Foreign Currency Lender, such Foreign Currency Lender shall pay the outstanding principal balance thereof to the Fronting Lender, and any such amounts paid by any Foreign Currency Lender to the Fronting Lender shall be deemed to constitute a Revolving Credit Advance or the purchase of an undivided interest in a Swing Line Advance, as applicable, and, to the extent necessary to effectuate the foregoing, the Fronting Lender shall be deemed to have sold, and such Foreign Currency Lender shall be deemed to have purchased, Revolving Credit Advances and participations in Swing Line Advances from the Fronting Lender. At any time any Lender is a Non-Funding Lender, at the Administrative Agent’s election at any time or upon any L/C Issuer’s, the Swing Line Lender’s or the Fronting Lender’s written request delivered to the Administrative Agent (whether before or after the occurrence of any Default or Event of Default), participating interests in any newly made Swing Line Loan or Foreign Currency Revolving Credit Advance or any newly issued or modified Letter of Credit will be allocated among Non-Funding Lenders in a manner consistent with this Section 9.9(d)(ii).

(iii) Voting Rights. Notwithstanding anything set forth herein to the contrary, including Section 9.1, a Non-Funding Lender shall not have any voting or consent rights under or with respect to any Loan Document or constitute a “Lender” (or be, or have its Loans, participations and Commitments, included in the determination of “Requisite Lenders”, “Supermajority Lenders” or “Lenders directly affected” pursuant to Section 11.2) for any voting or consent rights under or with respect to any Loan Document; provided, that (A) the Commitment of a Non-Funding Lender may not be increased, (B) the principal of a Non-Funding Lender’s Loans may not be reduced and (C) the interest rate applicable to Obligations owing to a Non-Funding Lender may not be reduced in such a manner that by its terms affects such Non-Funding Lender more adversely than other Lenders, in each case without the consent of such Non-Funding Lender. Moreover, for the purposes of determining Requisite Lenders or Supermajority Lenders, the Loans, participations and Commitments held by Non-Funding Lenders shall be excluded from the total Loans, participations and Commitments outstanding.

(iv) Borrower Payments to a Non-Funding Lender. Each Agent shall be authorized to use all payments received by such Agent for the benefit of any Non-Funding Lender pursuant to this Agreement to pay in full the Aggregate Excess Funding Amount to the appropriate Secured Parties. Following such payment in full of the Aggregate Excess Funding Amount, the Collateral Agent shall be entitled to hold such funds as cash collateral in a non-interest bearing account up to an amount equal to such Non-Funding Lender’s unfunded Commitment and to use such amount to pay such Non-Funding Lender’s funding obligations hereunder until the Obligations are paid in full in cash, all Letter of Credit Obligations have been discharged or cash collateralized and all Commitments have been terminated. Upon any such unfunded obligations owing by a Non-Funding Lender becoming due and payable, the Agents shall be authorized to use such cash collateral to make such payment on behalf of such Non-

Funding Lender. With respect to such Non-Funding Lender’s failure to fund Revolving Credit Advances, purchase participations in Letters of Credit or Letter of Credit Obligations or fund participations pursuant to Section 9.9(e)(i), any amounts applied by any Agent to satisfy such funding shortfalls shall be deemed to constitute a Revolving Credit Advance or amount of the participation required to be funded and, if necessary to effectuate the foregoing, the other Lenders shall be deemed to have sold, and such Non-Funding Lender shall be deemed to have purchased, Revolving Credit Advances or participation interests from the other Lenders until such time as the aggregate amount of the Revolving Credit Advances, participations in Letters of Credit and Letter of Credit Obligations and participations under Section 9.9(e)(i) are held by the Lenders in accordance with their Pro Rata Shares of the aggregate Commitments of the Lenders. Any amounts owing by a Non-Funding Lender to any Agent which are not paid when due shall accrue interest at the interest rate applicable during such period to Index Rate Loans. In the event that any Agent is holding cash collateral of a Non-Funding Lender that cures pursuant to clause (v) below or ceases to be a Non-Funding Lender pursuant to the definition of Non-Funding Lender, such Agent shall return the unused portion of such cash collateral to such Lender. The “Aggregate Excess Funding Amount” of a Non-Funding Lender shall be the aggregate amount of (A) all unpaid obligations owing by such Lender to the Agents, L/C Issuers, Swing Line Lender, Fronting Lender and other Lenders under the Loan Documents, including such Lender’s pro rata share of all Revolving Loans, Letter of Credit Obligations and Swing Line Loans and such Lender’s participations pursuant to Section 9.9(e)(i), plus, without duplication, (B) all amounts of such Non-Funding Lender’s Commitment reallocated to other Lenders pursuant to Section 9.9(d)(ii).

(v) Cure. A Lender may cure its status as a Non-Funding Lender under clause (a) of the definition of Non-Funding Lender if such Lender (A) fully pays to the Administrative Agent, on behalf of the applicable Secured Parties, the Aggregate Excess Funding Amount, plus all interest due thereon and (B) timely funds the next Revolving Credit Advance required to be funded by such Lender or makes the next reimbursement required to be made by such Lender. Any such cure shall not relieve any Lender from liability for breaching its contractual obligations hereunder.

(vi) Fees. A Lender that is a Non-Funding Lender pursuant to clause (a) of the definition of Non-Funding Lender shall not earn and shall not be entitled to receive, and the Borrowers shall not be required to pay, such Lender’s portion of the Fee set forth in Section 1.10(b) during the time such Lender is a Non-Funding Lender pursuant to clause (a) thereof. In the event that any reallocation of Letter of Credit Obligations occurs pursuant to Section 9.9(d)(ii), during the period of time that such reallocation remains in effect, the Letter of Credit Fee payable with respect to such reallocated portion shall be payable to (A) all Lenders based on their pro rata share of such reallocation or (B) to the L/C Issuer for any remaining portion not reallocated to any other Lenders. A Non-Foreign Currency Lender that is a Non-Funding Lender pursuant to clause (a) of the definition of Non-Funding Lender shall not earn and shall not be entitled to receive, and the Fronting Lender shall not be required to pay, such Lender’s portion of the Applicable Margin set forth in clause (a) of the first sentence of Section 9.9(e)(iii) during the time such Non-Foreign Currency Lender is a Non-Funding Lender pursuant to clause (a) thereof (and such portion of the Applicable Margin shall be retained by the Fronting Lender).

(e) Non-Foreign Currency Lenders.

(i) Participation Interests. On any date upon which the Fronting Lender shall be required to (i) make available the Fronted Percentage of any Foreign Currency Revolving Credit Advance pursuant to Section 1.1(a), Section 1.1(b)(iv) or pursuant to paragraph (b)(ii) of Annex B or (ii) purchase a participation interest in a Swing Line Advance denominated in a Foreign Currency pursuant to Section 1.1(b)(v), each Non-Foreign Currency Lender shall on such date be deemed to have irrevocably and unconditionally purchased from the Fronting Lender an undivided participation interest in such Advance in an amount equal to its Pro Rata Share of such Advance. The purchase price of any such participation interest shall be an amount, in Dollars, equal to the Dollar Equivalent of such Pro Rata Share as of the date payment by such Non-Foreign Currency Lenders of such purchase price is required hereunder; provided, however, that such purchase price need not be funded by any Non-Foreign Currency Lender unless and until the Fronting Lender, in its discretion, shall have made a demand therefor in writing to the Administrative Agent (which the Administrative Agent shall promptly forward to each Non-Foreign Currency Lender) with respect to each such participation interest following the occurrence of any Default or Event of Default or a good faith determination by the Fronting Lender that the portion of the interest it receives and retains on such Foreign Currency Revolving Credit Advances and Swing Line Loans does not adequately and fairly reflect the cost to the Fronting Lender of funding such amounts. Payment of such purchase price in respect of any such participation interest shall be made by each Non-Foreign Currency Lender in immediately available funds by wire transfer to the Fronting Lender’s account as set forth in Annex H not later than 2:00 p.m. (New York time) on the Business Day immediately following the date such demand is delivered to the Administrative Agent with respect to then outstanding Advances and on each applicable purchase date thereafter with respect to any subsequent Advances, in the case of Advances made as Index Rate Loans, and not later than 10:00 a.m. (New York time) on the Business Day immediately following the date such demand is delivered to the Administrative Agent with respect to then outstanding Advances and on each applicable purchase date thereafter with respect to any subsequent Advances, in the case of Advances made as LIBOR Loans. On any date upon which the Fronting Lender shall be required to purchase an undivided interest and participation in any Letter of Credit Obligation in respect of a Letter of Credit issued for the benefit of a Foreign Borrower pursuant to paragraph (b)(v) of Annex B, immediately and without further action whatsoever, each Non-Foreign Currency Lender shall be deemed to have irrevocably and unconditionally purchased from the Fronting Lender an undivided interest and participation in such participation interest. Each Non-Foreign Currency Lender shall fund its participation in all payments made under such Letters of Credit in the same manner as provided in the first sentence of this Section 9.9(e)(i) with respect to Foreign Currency Revolving Credit Advances, each of which Foreign Currency Revolving Credit Advances shall be in an amount equal to the Sterling Equivalent (if the applicable Letter of Credit was issued for the benefit of a U.K. Borrower) or Hong Kong Dollar Equivalent (if the applicable Letter of Credit was issued for the benefit of Sotheby’s H.K.) of such payment as of the date thereof.

(ii) Obligation of Non-Foreign Currency Lenders. Each Non-Foreign Currency Lender’s obligation to purchase participation interests (and to fund the purchase price thereof) in accordance with Section 9.9(e)(i) shall be absolute and unconditional and shall not be affected by any circumstance, including (A) any setoff, counterclaim, recoupment, defense or other right that such Non-Foreign Currency Lender may have against the Fronting Lender, any

Agent, any Borrower or any other Person for any reason whatsoever; (B) the occurrence or continuance of any Default or Event of Default; (C) any inability of any Borrower to satisfy the conditions precedent to borrowing set forth in this Agreement at any time or (D) any other circumstance, happening or event whatsoever, whether or not similar to any of the foregoing.

(iii) Payments to Non-Foreign Currency Lenders. On each Settlement Date (or, if the Fronting Lender shall not be acting as the Administrative Agent, on the Business Day following each Settlement Date), the Fronting Lender shall advise each Non-Foreign Currency Lender by telephone or telecopy of the amount to be disbursed to such Person in accordance with this Section 9.9(e)(iii). Except as set forth in Section 9.9(d), (a) prior to the funding of the purchase price of the participation interests of the Non-Foreign Currency Lenders in Advances made by the Fronting Lender in accordance with Section 9.9(e)(i), the Fronting Lender shall pay to each Non-Foreign Currency Lender the Dollar Equivalent (calculated as of the date of such payment by the Fronting Lender) of such Lender’s Pro Rata Share of the Applicable Margin paid by the Borrowers on the second Business Day preceding such Settlement Date for the benefit of the Lenders and the Fronting Lender with respect to interest on the portion of the Revolving Loan Outstandings denominated in a Foreign Currency (to the extent such amounts have actually been received by the Fronting Lender) less a portion of such Applicable Margin equal to one-half of one percent (0.50%) per annum (or such other amount as the Fronting Lender and such Non-Foreign Currency Lender shall agree) of such Non-Foreign Currency Lender’s Pro Rata Share of the Revolving Loan Outstandings denominated in a Foreign Currency, the latter amount being retained by the Fronting Lender for its own account in compensation for the Fronting Lender’s willingness to bear the foreign exchange rate fluctuation risk with respect to such Revolving Loan Outstandings and (b) at all times after the funding of the purchase price of the participation interests of the Non-Foreign Currency Lenders in Advances made by the Fronting Lender in accordance with Section 9.9(e)(i), the Fronting Lender shall pay to each Non-Foreign Currency Lender the Dollar Equivalent (calculated as of the date of such payment by the Fronting Lender) of such Lender’s Pro Rata Share of interest and principal paid by the Borrowers on the second Business Day preceding such Settlement Date for the benefit of the Lenders and the Fronting Lender with respect to the portion of the Revolving Loan Outstandings denominated in a Foreign Currency (to the extent such amounts have actually been received by the Fronting Lender). Such payments shall be made by wire transfer to such Non-Foreign Currency Lender’s account (as specified by such Lender in Annex H or the applicable Assignment Agreement) not later than 5:00 p.m. (New York time) on each applicable Settlement Date (or, if the Fronting Lender shall not be acting as the Administrative Agent, on the Business day following each Settlement Date).

(iv) Availability of Non-Foreign Currency Lender’s Pro Rata Share. The Fronting Lender may assume that each Non-Foreign Currency Lender will make its Pro Rata Share of each Foreign Currency Revolving Credit Advance available to the Fronting Lender on each date on which such Non-Foreign Currency Lender is required to pay the purchase price of its participation interests therein pursuant to the terms hereof. If any Non-Foreign Currency Lender does not make available to the Fronting Lender any amount required pursuant to Section 9.9(e)(i), the Fronting Lender shall be entitled to recover such amount on demand from such Non-Foreign Currency Lender, together with interest thereon for each day from the date of non-payment until such amount is paid in full at the Federal Funds Rate for the first two Business Days and at the Dollar Index Rate thereafter. If any Non-Foreign Currency Lender shall fail to

make available to the Fronting Lender any amount required pursuant to Section 9.9(e)(i), Borrowers shall immediately repay the outstanding principal amount of the portion of the Revolving Loan or Letter of Credit Obligation then outstanding to the Fronting Lender in which such Non-Foreign Currency Lender was required to purchase a participation interest, upon demand therefor by the Fronting Lender.

(v) Non-Funding Lender. Notwithstanding anything else to the contrary herein, if any Non-Foreign Currency Lender is a Non-Funding Lender or Impacted Lender, the Fronting Lender shall not be obligated to fund any Revolving Credit Advance unless (x) the Non-Funding Lender or Impacted Lender has been replaced in accordance with Section 1.17(d), (y) the participation funding obligations of such Non-Funding Lender or Impacted Lender under Section 9.9(e)(i) have been cash collateralized in a manner satisfactory to the Fronting Lender, or (z) the Commitments of the other Lenders have been increased by an amount sufficient to satisfy the Administrative Agent that all future Revolving Credit Advances by the Fronting Lender will be covered by all Non-Foreign Currency Lenders that are not Non-Funding Lenders or Impacted Lenders.

(f) Dissemination of Information. The Administrative Agent shall use reasonable efforts to provide Lenders with any notice of Default or Event of Default received by the Administrative Agent from, or delivered by the Administrative Agent to, any Credit Party, with notice of any Event of Default of which the Administrative Agent has actually become aware and with notice of any action taken by the Administrative Agent following any Event of Default; provided, that the Administrative Agent shall not be liable to any Lender for any failure to do so, except to the extent that such failure is attributable to the Administrative Agent’s gross negligence or willful misconduct as determined in a final, non-appealable judgment by a court of competent jurisdiction. Lenders acknowledge that Borrowers are required to provide Financial Statements and Collateral Reports to Lenders in accordance with Annexes E and F hereto and agree that the Administrative Agent shall have no duty to provide the same to Lenders.

(g) Actions in Concert. Anything in this Agreement to the contrary notwithstanding, each Lender hereby agrees with each other Lender that no Lender shall take any action to protect or enforce its rights arising out of this Agreement or any other Loan Document (including exercising any rights of setoff) without first obtaining the prior written consent of the Agents and Requisite Lenders, it being the intent of Lenders that any such action to protect or enforce rights under this Agreement and the Notes shall be taken in concert and at the direction or with the consent of the Agents or Requisite Lenders.

(h) Procedures. The Administrative Agent is hereby authorized by each Credit Party and each other Secured Party to establish procedures (and to amend such procedures from time to time) to facilitate administration and servicing of the Loans and other matters incidental thereto. Without limiting the generality of the foregoing, the Administrative Agent is hereby authorized to establish procedures to make available or deliver, or to accept, notices, documents and similar items on, by posting to or submitting and/or completion on, E-Systems.

9.10 Release of Guarantors or Collateral. Each Lender hereby authorizes the Collateral Agent to release the following:

(a) any Subsidiary of any Sotheby Entity from its guaranty of any Obligation of any Credit Party if all of the Stock of such Subsidiary owned by any Credit Party is sold in a sale permitted under the Loan Documents (including pursuant to a waiver or consent), to the extent that, after giving effect to such sale, such Subsidiary would not be required to guaranty any Obligations pursuant to any Loan Documents; and

(b) any Lien held by the Collateral Agent for the benefit of the Secured Parties against (i) any Collateral that is sold by a Credit Party in a sale permitted by the Loan Documents (including pursuant to a valid waiver or consent), and (ii) all of the Collateral and all Loan Parties, upon satisfaction of the conditions for such release pursuant to Section 11.2(f).

Each Lender hereby authorizes the Collateral Agent, and the Collateral Agent hereby agrees, upon receipt of reasonable advance notice from the Borrower Representative, to execute and deliver or file such documents and to perform other actions reasonably necessary to release the guaranties and Liens when and as directed in this Section 9.10.

10. SUCCESSORS AND ASSIGNS

10.1	Successors and Assigns.

This Agreement and the other Loan Documents shall be binding on and shall inure to the benefit of each Credit Party, the Agents, Lenders and their respective successors and assigns (including, in the case of any Credit Party, a debtor-in-possession on behalf of such Credit Party), except as otherwise provided herein or therein. No Credit Party may assign, transfer, hypothecate or otherwise convey its rights, benefits, obligations or duties hereunder or under any of the other Loan Documents without the prior express written consent of the Agents and Lenders. Any such purported assignment, transfer, hypothecation or other conveyance by any Credit Party without the prior express written consent of the Agents and Lenders shall be void. The terms and provisions of this Agreement are for the purpose of defining the relative rights and obligations of each Credit Party, the Agents and Lenders with respect to the transactions contemplated hereby and no Person shall be a third party beneficiary of any of the terms and provisions of this Agreement or any of the other Loan Documents.

11. MISCELLANEOUS

11.1	Complete Agreement; Modification of Agreement.

The Loan Documents constitute the complete agreement between the parties with respect to the subject matter thereof and may not be modified, altered or amended except as set forth in Section 11.2. Any letter of interest, commitment letter, fee letter or confidentiality agreement, if any, between any Credit Party and any Agent or any Lender or any of their respective Affiliates, predating this Agreement and relating to a financing of substantially similar form, purpose or effect shall be superseded by this Agreement.

11.2	Amendments and Waivers.

(a) Except for actions expressly permitted to be taken by any Agent, no amendment, modification, termination or waiver of any provision of this Agreement or any other Loan Document, or any consent to any departure by any Credit Party therefrom, shall in any event be effective unless the same shall be in writing and signed by the Administrative Agent and Borrowers, and by Requisite Lenders, Supermajority Lenders or all affected Lenders, as applicable. Except as set forth in clauses (b), (c) and (d) below, all such amendments, modifications, terminations or waivers requiring the consent of any Lenders shall require the written consent of Requisite Lenders.

(b) No amendment, modification, termination or waiver of or consent with respect to any provision of this Agreement or any other Loan Document shall, unless in writing and signed by the Administrative Agent and Supermajority Lenders: (i) increase the percentage advance rates set forth in the definition of either Borrowing Base, (ii) modify any criteria set forth in Section 1.6, 1.7 or 1.8 in a manner that would have the effect of making more credit available or (iii) increase the Foreign Currency Subfacility Limit.

(c) No amendment, modification, termination or waiver with respect to any provision of this Agreement or any other Loan Document shall, unless in writing and signed by the Administrative Agent and each Lender directly affected thereby: (i) increase the principal amount of any Lender’s Commitment; (ii) reduce the principal of, rate of interest on or Fees payable with respect to any Loan or Letter of Credit Obligations of any affected Lender (except that (A) any amendment or modification of any financial covenant in this Agreement (or defined terms used in such financial covenant in this Agreement) or (B) any amendment modifying the definition of “Default Rate” (or amendment modifying Section 1.5(d) for purposes of modifying the definition of “Default Rate”) or any waiver of any obligation of the Credit Parties to pay interest or Letter of Credit Fees at the Default Rate shall not, in either case, constitute a reduction in the rate of interest or Fees for purposes of this clause (ii)); (iii) extend any scheduled payment date (other than payment dates of mandatory prepayments under Sections 1.3(b)(iii) and (iv)) or final maturity date of the principal amount of any Loan of any affected Lender; (iv) waive, forgive, defer, extend or postpone any payment of interest or Fees as to any affected Lender; (v) release all or substantially all the value of any Guaranty (other than in connection with any sale of assets by a Sotheby Entity (A) permitted pursuant to Section 6.8 or (B) consented to by Requisite Lenders or Supermajority Lenders, as applicable, pursuant to this Section 11.2) or, except as otherwise permitted herein or in the other Loan Documents, release, or permit any Credit Party to sell or otherwise dispose of, all or substantially all of the Collateral (which action shall be deemed to directly affect all Lenders and the L/C Issuer); (vi) change the percentage of the Commitments or of the aggregate unpaid principal amount of the Loans that shall be required for Lenders or any of them to take any action hereunder; (vii) amend or waive Section 1.12(a); (viii) amend or waive this Section 11.2 or the definitions of the terms “Requisite Lenders” or “Supermajority Lenders” insofar as such definitions affect the substance of this Section 11.2 or (ix) designate a new “Borrower” hereunder. Furthermore, no amendment, modification, termination or waiver affecting the rights or duties of the Administrative Agent, the Collateral Agent, the Fronting Lender or L/C Issuer under this Agreement or any other Loan Document, including any release of any Guaranty or Collateral requiring a writing signed by all Lenders and, in the case of the L/C Issuer, any increase in the L/C Sublimit, shall be effective unless in

writing and signed by the Administrative Agent, the Collateral Agent, the Fronting Lender or L/C Issuer, as the case may be, in addition to Lenders required hereinabove to take such action. Each amendment, modification, termination or waiver shall be effective only in the specific instance and for the specific purpose for which it was given. No amendment, modification, termination or waiver shall be required for any Agent to take additional Collateral pursuant to any Loan Document. No amendment, modification, termination or waiver of any provision of any Note shall be effective without the written concurrence of the holder of that Note. No notice to or demand on any Sotheby Entity in any case shall entitle such Sotheby Entity or any other Sotheby Entity to any other or further notice or demand in similar or other circumstances. Any amendment, modification, termination, waiver or consent effected in accordance with this Section 11.2 shall be binding upon each holder of the Notes at the time outstanding and each future holder of the Notes.

(d) No amendment, modification or waiver of this Agreement or any Loan Document resulting in any Bank Product and Hedging Obligations becoming unsecured (other than releases of Liens permitted in accordance with the terms hereof) shall be effective without the written consent of such holder of Bank Product and Hedging Obligations or, in the case of Bank Product and Hedging Obligations provided or arranged by GE Capital or an Affiliate of GE Capital, GE Capital.

(e) If, in connection with any proposed amendment, modification, waiver or termination (a “Proposed Change”):

(i) requiring the consent of all affected Lenders, the consent of Requisite Lenders is obtained, but the consent of other Lenders whose consent is required is not obtained (any such Lender whose consent is not obtained as described in this clause (i) and in clause (ii) below being referred to as a “Non-Consenting Lender”); or

(ii) requiring the consent of Supermajority Lenders, the consent of Requisite Lenders is obtained, but the consent of Supermajority Lenders is not obtained;

then, so long as neither Agent is a Non-Consenting Lender, at Borrower Representative’s request, the Administrative Agent or a Person reasonably acceptable to the Administrative Agent shall have the right with the Administrative Agent’s consent and in the Administrative Agent’s sole discretion (but shall have no obligation) to purchase from such Non-Consenting Lenders, and such Non-Consenting Lenders agree that they shall, upon the Administrative Agent’s request, sell and assign to the Administrative Agent or such Person, all of the Loans and Commitments of such Non-Consenting Lenders for an amount equal to the principal balance of all Loans held by the Non-Consenting Lenders and all accrued interest and Fees with respect thereto through the date of sale, such purchase and sale to be consummated pursuant to an executed Assignment Agreement.

(f) Upon (i) payment in full in cash and performance of all of the Obligations and Bank Product and Hedging Obligations, but excluding contingent Obligations, (ii) termination of the Commitments, (iii) deposit of cash collateral (or, as an alternative to cash collateral in the case of any Letter of Credit Obligation, receipt by the Collateral Agent of a back-up letter of credit) with respect to all contingent Obligations (excluding contingent Obligations (other than Letter of Credit Obligations) as to which no claim has been asserted), in

amounts and on terms and conditions and with parties reasonably satisfactory to the Collateral Agent and each Indemnified Person that is or may be owed such Obligations and (iv) a release of all claims against the Agents and Lenders, and so long as no suits, actions, proceedings or claims are pending or threatened against any Indemnified Person asserting any damages, losses or liabilities that are Indemnified Liabilities, the Collateral Agent shall deliver to Borrowers termination statements, mortgage releases and other documents necessary or appropriate to evidence the termination of the Liens securing payment of the Obligations.

11.3	Fees and Expenses.

Borrowers shall reimburse (i) each Agent for all fees, costs and expenses (including the reasonable fees and expenses of all of its counsel, advisors, consultants and auditors) and (ii) each Agent (and, with respect to clauses (b), (c) and (d) below, all Lenders and the Fronting Lender) for all fees, costs and expenses, including the reasonable fees, costs and expenses of counsel or other advisors (including environmental and management consultants and appraisers), incurred in connection with the negotiation, preparation and filing and/or recordation of the Loan Documents and incurred in connection with:

(a) any amendment, modification or waiver of, consent with respect to, or termination of, any of the Loan Documents or advice in connection with the syndication and administration of the Loans made pursuant hereto or its rights hereunder or thereunder;

(b) any litigation, contest, dispute, suit, proceeding or action (whether instituted by any Agent, any Lender, the Fronting Lender, any Sotheby Entity or any other Person and whether as a party, witness or otherwise) in any way relating to the Collateral, any of the Loan Documents or any other agreement to be executed or delivered in connection herewith or therewith, including any litigation, contest, dispute, suit, case, proceeding or action, and any appeal or review thereof, in connection with a case commenced by or against any or all of the Sotheby Entities or any other Person that may be obligated to any Agent, any Lender or the Fronting Lender by virtue of the Loan Documents; including any such litigation, contest, dispute, suit, proceeding or action arising in connection with any work-out or restructuring of the Loans during the pendency of one or more Events of Default; provided, that in the case of reimbursement of counsel for Lenders or the Fronting Lender other than the Agents, such reimbursement shall be limited to one counsel for all such Lenders and the Fronting Lender; provided, further, that no Person shall be entitled to reimbursement under this clause (b) in respect of any litigation, contest, dispute, suit, proceeding or action to the extent any of the foregoing results from such Person’s gross negligence or willful misconduct as determined in a final, non-appealable judgment by a court of competent jurisdiction;

(c) any attempt to enforce any remedies of any Agent against any or all of the Credit Parties or any other Person that may be obligated to any Agent, any Lender or the Fronting Lender by virtue of any of the Loan Documents, including any such attempt to enforce any such remedies in the course of any work-out or restructuring of the Loans during the pendency of one or more Events of Default; provided, that in the case of reimbursement of counsel for Lenders and the Fronting Lender other than the Agents, such reimbursement shall be limited to one counsel for all such Lenders and the Fronting Lender;

(d) any workout or restructuring of the Loans during the pendency of one or more Events of Default; provided, that in the case of reimbursement of counsel for Lenders and the Fronting Lender other than the Agents, such reimbursement shall be limited to one counsel for all such Lenders and the Fronting Lender; and

(e) efforts to (i) monitor the Loans or any of the other Obligations, (ii) evaluate, observe or assess any of the Sotheby Entities or their respective affairs, and (iii) verify, protect, evaluate, assess, appraise, collect, sell, liquidate or otherwise dispose of any of the Collateral;

including, as to each of clauses (a) through (e) above, all reasonable attorneys’ and other professional and service providers’ fees arising from such services and other advice, assistance or other representation, including those in connection with any appellate proceedings, and all expenses, costs, charges and other fees incurred by such counsel and others in connection with or relating to any of the events or actions described in this Section 11.3, all of which shall be payable, on demand, by Borrowers to the Agents. Without limiting the generality of the foregoing, such expenses, costs, charges and fees may include: fees, costs and expenses of accountants, environmental advisors, appraisers, investment bankers, management and other consultants and paralegals; court costs and expenses; photocopying and duplication expenses; court reporter fees, costs and expenses; long distance telephone charges; air express charges; telegram or telecopy charges; secretarial overtime charges; and expenses for travel, lodging and food paid or incurred in connection with the performance of such legal or other advisory services.

11.4	No Waiver.

Any Agent’s or any Lender’s failure, at any time or times, to require strict performance by the Sotheby Entities of any provision of this Agreement or any other Loan Document shall not waive, affect or diminish any right of such Agent or such Lender thereafter to demand strict compliance and performance herewith or therewith. Any suspension or waiver of an Event of Default shall not suspend, waive or affect any other Event of Default whether the same is prior or subsequent thereto and whether the same or of a different type. Subject to the provisions of Section 11.2, none of the undertakings, agreements, warranties, covenants and representations of any Sotheby Entity contained in this Agreement or any of the other Loan Documents and no Default or Event of Default by any Sotheby Entity shall be deemed to have been suspended or waived by any Agent or any Lender, unless such waiver or suspension is by an instrument in writing signed by an officer of or other authorized employee of applicable Agent and the applicable required Lenders, and directed to Borrowers specifying such suspension or waiver.

11.5

Remedies.

The Agents’ and Lenders’ rights and remedies under this Agreement shall be cumulative and nonexclusive of any other rights and remedies that any Agent or any Lender may have under any other agreement, including the other Loan Documents, by operation of law or otherwise. Recourse to the Collateral shall not be required.

11.6	Severability.

Wherever possible, each provision of this Agreement and the other Loan Documents shall be interpreted in such a manner as to be effective and valid under applicable law, but if any provision of this Agreement or any other Loan Document shall be prohibited by or invalid under applicable law, such provision shall be ineffective only to the extent of such prohibition or invalidity without invalidating the remainder of such provision or the remaining provisions of this Agreement or such other Loan Document.

11.7	Conflict of Terms.

Except as otherwise provided in this Agreement or any of the other Loan Documents by specific reference to the applicable provisions of this Agreement, if any provision contained in this Agreement conflicts with any provision in any of the other Loan Documents, the provision contained in this Agreement shall govern and control.

11.8	Confidentiality.

(a) Confidential Information. Each Agent, each L/C Issuer, and each Lender agree to use commercially reasonable efforts (equivalent to the efforts such Agent, such L/C Issuer or such Lender applies to maintaining the confidentiality of its own confidential information) to maintain as confidential all confidential information provided to them by the Sotheby Entities and designated as confidential for a period of two (2) years following receipt thereof, except that any Agent, any L/C Issuer and any Lender may disclose such information (i) to Persons employed or engaged by such Agent, such L/C Issuer or such Lender, or such Agent’s, L/C Issuer’s or Lender’s Affiliates; (ii) to any bona fide assignee or participant or potential assignee or participant that has agreed to be bound by provisions substantially similar to the provisions of this Section 11.8 (and any such bona fide assignee or participant or potential assignee or participant may disclose such information to Persons employed or engaged by them as described in clause (i) above); (iii) as required or requested by any Governmental Authority or reasonably believed by such Agent, such L/C Issuer or such Lender to be compelled by any court decree, subpoena or legal or administrative order or process; (iv) as, on the advice of such Agent’s, such L/C Issuer’s or such Lender’s counsel, is required by law; (v) in connection with the exercise of any right or remedy under the Loan Documents or in connection with any Litigation to which such Agent, such L/C Issuer or such Lender is a party; or (vi) that ceases to be confidential through no fault of any Agent, any L/C Issuer or any Lender. Furthermore, each Credit Party releases any Agent, any L/C Issuer and any Lender from the applicable banking secrecy obligations with regard to the Loan Documents and to any information directly or indirectly relating to the credit relations described in this Agreement to the extent as required for the execution, performance and administration of the Loan Documents, and/or for due exercise of the respective rights or fulfillment of the respective obligations by any Agent, any L/C Issuer or any Lender and authorizes the respective party to forward data within its respective jurisdiction and abroad.

(b) Tombstones; League Tables. Each Credit Party consents to the publication by any Agent or any Lender of any press releases, tombstones, advertising or other promotional materials (including, without limitation, via any Electronic Transmission) relating to

the financing transactions contemplated by this Agreement using such Credit Party’s name, logo or trademark. Such Agent or such Lender shall provide a draft of any such press release, advertising or other material to Borrower Representative for review and comment prior to the publication thereof. Each Lender hereby consents to the disclosure by each Agent, each Lead Arranger and each Bookrunner of information necessary or customary for inclusion in league table measurements.

(c) Distribution of Materials to Lenders and L/C Issuers. The Credit Parties acknowledge and agree that the Loan Documents and all reports, notices, communications and other information or materials provided or delivered by, or on behalf of, the Credit Parties hereunder (collectively, the “Borrower Materials”) may be disseminated by, or on behalf of, any Agent, and made available, to the Lenders and the L/C Issuers by posting such Borrower Materials on an E-System. The Credit Parties authorize each Agent to download copies of their logos from its website and post copies thereof on an E-System.

11.9	GOVERNING LAW.

EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN ANY OF THE LOAN DOCUMENTS, IN ALL RESPECTS, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, THE LOAN DOCUMENTS AND THE OBLIGATIONS SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND PERFORMED IN THAT STATE AND ANY APPLICABLE LAWS OF THE UNITED STATES OF AMERICA. EACH PARTY HERETO HEREBY CONSENTS AND AGREES THAT THE STATE OR FEDERAL COURTS LOCATED IN ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ SHALL HAVE EXCLUSIVE JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN THE CREDIT PARTIES, THE AGENTS AND LENDERS PERTAINING TO THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR TO ANY MATTER ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS; PROVIDED, THAT THE AGENTS, THE LENDERS AND THE CREDIT PARTIES ACKNOWLEDGE THAT ANY APPEALS FROM THOSE COURTS MAY HAVE TO BE HEARD BY ▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇; PROVIDED FURTHER, THAT NOTHING IN THIS AGREEMENT SHALL BE DEEMED OR OPERATE TO PRECLUDE ANY AGENT FROM BRINGING SUIT OR TAKING OTHER LEGAL ACTION IN ANY OTHER JURISDICTION TO REALIZE ON THE COLLATERAL OR ANY OTHER SECURITY FOR THE OBLIGATIONS, OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF SUCH AGENT. EACH PARTY HERETO EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO SUCH JURISDICTION IN ANY ACTION OR SUIT COMMENCED IN ANY SUCH COURT, AND EACH PARTY HERETO HEREBY WAIVES ANY OBJECTION THAT SUCH PARTY MAY HAVE BASED UPON LACK OF PERSONAL JURISDICTION, IMPROPER VENUE OR FORUM NON CONVENIENS AND HEREBY CONSENTS TO THE GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS DEEMED APPROPRIATE BY SUCH COURT. EACH PARTY HERETO HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS, COMPLAINT AND

OTHER PROCESS ISSUED IN ANY SUCH ACTION OR SUIT AND AGREES THAT SERVICE OF SUCH SUMMONS, COMPLAINTS AND OTHER PROCESS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL ADDRESSED TO SUCH PARTY AT THE ADDRESS SET FORTH IN ANNEX H OF THIS AGREEMENT AND THAT SERVICE SO MADE SHALL BE DEEMED COMPLETED UPON THE EARLIER OF SUCH PARTY’S ACTUAL RECEIPT THEREOF OR FIVE (5) DAYS AFTER DEPOSIT IN THE UNITED STATES MAILS, PROPER POSTAGE PREPAID.

11.10

Notices.

(a) Addresses. All notices, demands, requests, directions and other communications required or expressly authorized to be made by this Agreement shall, whether or not specified to be in writing but unless otherwise expressly specified to be given by any other means, be given in writing and (i) addressed to (A) the party to be notified and sent to the address or facsimile number indicated in Annex I, or (B) otherwise to the party to be notified at its address specified on the signature page of any applicable Assignment Agreement, (ii) posted to Syndtrak® (to the extent such system is available and set up by or at the direction of the Administrative Agent prior to posting) in an appropriate location by uploading such notice, demand, request, direction or other communication to ▇▇▇.▇▇▇▇▇▇▇▇.▇▇▇ or using such other means of posting to Syndtrak ® as may be available and reasonably acceptable to the Administrative Agent prior to such posting, (iii) posted to any other E-System set up by or at the direction of the Administrative Agent in an appropriate location or (iv) addressed to such other address as shall be notified in writing (A) in the case of Borrower Representative, the Administrative Agent, the Collateral Agent and Swing Line Lender, to the other parties hereto and (B) in the case of all other parties, to Borrower Representative and the Administrative Agent. Transmission by electronic mail (including E-Fax, even if transmitted to the fax numbers set forth in clause (i) above) shall not be sufficient or effective to transmit any such notice under this clause (a) unless such transmission is an available means to post to any E-System.

(b) Effectiveness.

(i) All communications described in clause (a) above and all other notices, demands, requests and other communications made in connection with this Agreement shall be effective and be deemed to have been received (i) if delivered by hand, upon personal delivery, (ii) if delivered by overnight courier service, one Business Day after delivery to such courier service, (iii) if delivered by mail, when deposited in the mails, (iv) if delivered by facsimile (other than to post to an E-System pursuant to clause (a)(ii) or (a)(iii) above), upon sender’s receipt of confirmation of proper transmission, and (v) if delivered by posting to any E-System, on the later of the date of such posting in an appropriate location and the date access to such posting is given to the recipient thereof in accordance with the standard procedures applicable to such E-System; provided, however, that no communications to any Agent pursuant to Article I shall be effective until received by such Agent. Failure or delay in delivering copies of any notice, demand, request, consent, approval, declaration or other communication to any Person (other than Borrower Representative or the Agents) designated in Annex I to receive copies shall in no way adversely affect the effectiveness of such notice, demand, request, consent, approval, declaration or other communication. The giving of any notice required hereunder may be waived in writing by the party entitled to receive such notice.

(ii) The posting, completion and/or submission by any Credit Party of any communication pursuant to an E-System shall constitute a representation and warranty by the Credit Parties that any representation, warranty, certification or other similar statement required by the Loan Documents to be provided, given or made by a Credit Party in connection with any such communication is true, correct and complete in all material respects except as expressly noted in such communication or E-System.

(iii) Each Lender shall notify the Administrative Agent in writing of any changes in the address to which notices to such Lender should be directed, of payment instructions in respect of all payments to be made to it hereunder and of such other administrative information as the Administrative Agent shall reasonably request.

11.11

Section Titles.

The Section titles and Table of Contents contained in this Agreement are and shall be without substantive meaning or content of any kind whatsoever and are not a part of the agreement between the parties hereto.

11.12

Counterparts; Facsimile Signature.

This Agreement may be executed in any number of counterparts and by different parties in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement. Signature pages may be detached from multiple separate counterparts and attached to a single counterpart. Delivery of an executed signature page of this Agreement by facsimile transmission or Electronic Transmission shall be as effective as delivery of a manually executed counterpart hereof.

11.13

WAIVER OF JURY TRIAL.

BECAUSE DISPUTES ARISING IN CONNECTION WITH COMPLEX FINANCIAL TRANSACTIONS ARE MOST QUICKLY AND ECONOMICALLY RESOLVED BY AN EXPERIENCED AND EXPERT PERSON AND THE PARTIES WISH APPLICABLE STATE AND FEDERAL LAWS TO APPLY (RATHER THAN ARBITRATION RULES), THE PARTIES DESIRE THAT THEIR DISPUTES BE RESOLVED BY A JUDGE APPLYING SUCH APPLICABLE LAWS. THEREFORE, TO ACHIEVE THE BEST COMBINATION OF THE BENEFITS OF THE JUDICIAL SYSTEM AND OF ARBITRATION, THE PARTIES HERETO WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, SUIT, OR PROCEEDING BROUGHT TO RESOLVE ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE, AMONG THE AGENTS, THE LENDERS AND ANY CREDIT PARTY ARISING OUT OF, CONNECTED WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED AMONG THEM IN CONNECTION WITH, THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR THE TRANSACTIONS RELATED THERETO.

11.14

Press Releases and Related Matters.

Each Credit Party executing this Agreement agrees that neither it nor its Affiliates will in the future issue any press releases or other public disclosure using the name of GE Capital or its affiliates or referring to this Agreement or the other Loan Documents without the prior written consent of GE Capital (not to be unreasonably withheld) unless (and only to the extent that) such Credit Party or Affiliate is required to do so under law and then, in any event, such Credit Party or Affiliate will consult with GE Capital before issuing such press release or other public disclosure. Each Credit Party consents to the publication by any Agent or any Lender of advertising material relating to the financing transactions contemplated by this Agreement using any Borrower’s name, logo or trademark. Each Agent consents to the disclosure by the Credit Parties in their public securities filings and Financial Statements of the identity and role of such Agent under this Agreement. Each Agent reserves the right to provide to industry trade organizations information necessary and customary for inclusion in league table measurements.

11.15

Reinstatement.

This Agreement shall remain in full force and effect and continue to be effective should any petition be filed by or against any Credit Party for liquidation or reorganization, should any Credit Party become insolvent or make an assignment for the benefit of any creditor or creditors or should a receiver or trustee be appointed for all or any significant part of any Credit Party’s assets, and shall continue to be effective or to be reinstated, as the case may be, if at any time payment and performance of the Obligations, or any part thereof, is, pursuant to applicable law, rescinded or reduced in amount, or must otherwise be restored or returned by any obligee of the Obligations, whether as a “voidable preference,” “fraudulent conveyance,” or otherwise (including pursuant to any settlement entered into by a Secured Party in its discretion), all as though such payment or performance had not been made. In the event that any payment, or any part thereof, is rescinded, reduced, restored or returned, the Obligations shall be reinstated and deemed reduced only by such amount paid and not so rescinded, reduced, restored or returned.

11.16

Advice of Counsel.

Each of the parties represents to each other party hereto that it has discussed this Agreement and, specifically, the provisions of Sections 11.9 and 11.13, with its counsel.

11.17

No Strict Construction.

The parties hereto have participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties hereto and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any provisions of this Agreement.

11.18

PATRIOT Act.

Each Lender that is subject to the PATRIOT Act and each Agent (for itself and not on behalf of any Lender) hereby notifies Borrowers that pursuant to the requirements of the

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PATRIOT Act, it is required to obtain, verify and record information that identifies Borrowers, which information includes the name and address of each Borrower and other information that will allow such Lender or such Agent, as applicable, to identify such Borrower in accordance with the PATRIOT Act. Each Borrower shall, promptly following a request by any Agent or any Lender, provide all documentation and other information that such Agent or such Lender requests in order to comply with its ongoing obligations under applicable “know your customer” and anti-money laundering rules and regulations, including the PATRIOT Act.

11.19

Creditor-Debtor Relationship

The relationship between each Agent, each Lender, and each L/C Issuer, on the one hand, and the Credit Parties, on the other hand, is solely that of creditor and debtor. No Secured Party has any fiduciary relationship or duty to any Credit Party arising out of or in connection with, and there is no agency, tenancy or joint venture relationship between the Secured Parties and the Credit Parties by virtue of, any Loan Document or any transaction contemplated therein.

11.20

Electronic Transmissions

(a) Authorization. Subject to the provisions of Section 11.10(a), each of the Agents, the Lenders, the Credit Parties and their Related Persons, is authorized (but not required) to transmit, post or otherwise make or communicate, in its sole discretion, Electronic Transmissions in connection with any Loan Document and the transactions contemplated therein. Each Credit Party and each Secured Party hereto acknowledges and agrees that the use of Electronic Transmissions is not necessarily secure and that there are risks associated with such use, including risks of interception, disclosure and abuse and each indicates it assumes and accepts such risks by hereby authorizing the transmission of Electronic Transmissions.

(b) Signatures. Subject to the provisions of Section 11.10(a), (i)(A) no posting to any E-System shall be denied legal effect merely because it is made electronically, (B) each E-Signature on any such posting shall be deemed sufficient to satisfy any requirement for a “signature” and (C) each such posting shall be deemed sufficient to satisfy any requirement for a “writing”, in each case including pursuant to any Loan Document, any applicable provision of any UCC, the federal Uniform Electronic Transactions Act, the Electronic Signatures in Global and National Commerce Act and any substantive or procedural requirement under applicable law governing such subject matter, (ii) each such posting that is not readily capable of bearing either a signature or a reproduction of a signature may be signed, and shall be deemed signed, by attaching to, or logically associating with such posting, an E-Signature, upon which each Secured Party and each Credit Party may rely and assume the authenticity thereof, (iii) each such posting containing a signature, a reproduction of a signature or an E-Signature shall, for all intents and purposes, have the same effect and weight as a signed paper original and (iv) each party hereto or beneficiary hereto agrees not to contest the validity or enforceability of any posting on any E-System or E-Signature on any such posting under the provisions of any applicable law requiring certain documents to be in writing or signed; provided, however, that nothing herein shall limit such party’s or beneficiary’s right to contest whether any posting to any E-System or E-Signature has been altered after transmission.

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(c) Separate Agreements. All uses of an E-System shall be governed by and subject to, in addition to Section 11.10 and this Section 11.20, the separate terms, conditions and privacy policy posted or referenced in such E-System (or such terms, conditions and privacy policy as may be updated from time to time, including on such E-System) and related arrangements entered into by the Administrative Agent and Credit Parties in connection with the use of such E-System.

(d) LIMITATION OF LIABILITY. ALL E-SYSTEMS AND ELECTRONIC TRANSMISSIONS SHALL BE PROVIDED “AS IS” AND “AS AVAILABLE”. NONE OF ANY AGENT, ANY LENDER OR ANY OF THEIR RELATED PERSONS WARRANTS THE ACCURACY, ADEQUACY OR COMPLETENESS OF ANY E-SYSTEMS OR ELECTRONIC TRANSMISSION AND DISCLAIMS ALL LIABILITY FOR ERRORS OR OMISSIONS THEREIN. NO WARRANTY OF ANY KIND IS MADE BY ANY AGENT, ANY LENDER OR ANY OF THEIR RELATED PERSONS IN CONNECTION WITH ANY E-SYSTEMS OR ELECTRONIC COMMUNICATION, INCLUDING ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD-PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS. Each Borrower, each other Credit Party executing this Agreement and each Secured Party agrees that no Agent has any responsibility for maintaining or providing any equipment, software, services or any testing required in connection with any Electronic Transmission or otherwise required for any E-System.

12. CROSS-GUARANTY

12.1	Cross-Guaranty.

Each Domestic Borrower hereby agrees that such Domestic Borrower is jointly and severally liable for, and hereby absolutely and unconditionally guarantees to the Agents and Lenders and their respective successors and assigns, the full and prompt payment (whether at stated maturity, by acceleration or otherwise) and performance of, all Secured Obligations owed or hereafter owing to the Agents and Lenders by each other Domestic Borrower and each Foreign Borrower. Each Foreign Borrower hereby agrees that such Foreign Borrower is jointly and severally liable for, and hereby absolutely and unconditionally guarantees to the Agents and Lenders and their respective successors and assigns, the full and prompt payment (whether at stated maturity, by acceleration or otherwise) and performance of, all Secured Obligations owed or hereafter owing to the Agents and Lenders by each other Foreign Borrower; it being understood that the Foreign Borrowers shall have no liability, direct or indirect, for the Secured Obligations of the Domestic Borrowers or the other Domestic Credit Parties hereunder or under any of the Loan Documents. Each Borrower agrees that its guaranty obligation hereunder is a continuing guaranty of payment and performance and not of collection, that its obligations under this Section 12 shall not be discharged until payment and performance, in full, of the Secured Obligations (in the case of any Domestic Borrower) or the Secured Obligations of the Foreign Borrowers (in the case of any Foreign Borrower) has occurred, and that its obligations under this Section 12 shall be absolute and unconditional, irrespective of, and unaffected by,

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(a) the genuineness, validity, regularity, enforceability or any future amendment of, or change in, this Agreement, any other Loan Document or any other agreement, document or instrument to which any Borrower is or may become a party;

(b) the absence of any action to enforce this Agreement (including this Section 12) or any other Loan Document or the waiver or consent by the Agents and Lenders with respect to any of the provisions thereof;

(c) the existence, value or condition of, or failure to perfect its Lien against, any security for the Secured Obligations or any action, or the absence of any action, by the Agents and Lenders in respect thereof (including the release of any such security);

(d) the insolvency of any Sotheby Entity; or

(e) any other action or circumstances that might otherwise constitute a legal or equitable discharge or defense of a surety or guarantor.

Each Domestic Borrower shall be regarded, and shall be in the same position, as principal debtor with respect to the Secured Obligations guaranteed hereunder. Each Foreign Borrower shall be regarded, and shall be in the same position, as principal debtor with respect to the Secured Obligations of the other Foreign Borrower guaranteed hereunder.

12.2	Waivers by Borrowers.

Each Borrower expressly waives all rights it may have now or in the future under any statute, or at common law, or at law or in equity, or otherwise, to compel the Agents or Lenders to marshal assets or to proceed in respect of the Secured Obligations guaranteed hereunder by such Borrower against any other Credit Party, any other party or against any security for the payment and performance of such Secured Obligations before proceeding against, or as a condition to proceeding against, such Borrower. It is agreed among each Borrower, the Agents and Lenders that the foregoing waivers are of the essence of the transaction contemplated by this Agreement and the other Loan Documents and that, but for the provisions of this Section 12 and such waivers, the Agents and Lenders would decline to enter into this Agreement.

12.3	Benefit of Guaranty.

Each Borrower agrees that the provisions of this Section 12 are for the benefit of the Agents and Lenders and their respective successors, transferees, endorsees and assigns, and nothing herein contained shall impair, as between any other Borrower and the Agents or Lenders, the obligations of such other Borrower under the Loan Documents.

12.4	Waiver of Subrogation, Etc.

Notwithstanding anything to the contrary in this Agreement or in any other Loan Document, and except as set forth in the Domestic Guaranty and Security Agreement, each Borrower hereby expressly and irrevocably waives any and all rights at law or in equity to subrogation, reimbursement, exoneration, contribution, indemnification or set off and any and all

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defenses available to a surety, guarantor or accommodation co-obligor. Each Borrower acknowledges and agrees that this waiver is intended to benefit the Agents and Lenders and shall not limit or otherwise affect such Borrower’s liability hereunder or the enforceability of this Section 12, and that the Agents, Lenders and their respective successors and assigns are intended third party beneficiaries of the waivers and agreements set forth in this Section 12.4.

12.5	Subordination by Credit Parties.

Each Credit Party agrees that any and all claims of such Credit Party against any other Borrower or any Guarantor (each an “Obligor”) with respect to any “Intercompany Indebtedness” (as hereinafter defined), any endorser, obligor or any other guarantor of all or any part of the Secured Obligations, or against any of its properties shall be subordinate and subject in right of payment to the prior payment, in full and in cash, of all Secured Obligations of (i) in the case of the Foreign Credit Parties, such Obligors that are Foreign Credit Parties and (ii) in the case of the Domestic Credit Parties, the Borrowers and the Guarantors, in each case now existing or hereafter arising, including, without limitation, all such Secured Obligations arising after the filing of a petition in bankruptcy under the Bankruptcy Code, regardless of whether or not allowed under such case or proceeding; provided, however, that Intercompany Indebtedness may be repaid in the ordinary course of the Credit Parties’ businesses; provided, further, however, that following the occurrence and continuance of an Event of Default and the Collateral Agent’s notice to the Credit Parties of the Collateral Agent’s exercise of its rights under this paragraph, all such payments with respect to the Intercompany Indebtedness shall be paid directly to the Collateral Agent for application to the Secured Obligations in accordance with the terms of the Loan Documents. Notwithstanding any right of any Credit Party to ask, demand, ▇▇▇ for, take or receive any payment from any Obligor, all rights, liens and security interests of such Credit Party, whether now or hereafter arising and howsoever existing, in any assets of any other Obligor shall be and are subordinated to the rights of the Agents and the Lenders in those assets, it being understood and agreed that the Agents and the Lenders shall have no right to use assets of an Obligor that constitutes a Foreign Credit Party in support of Secured Obligations of the Domestic Credit Parties. No Credit Party shall have any right to possession of any such asset or to foreclose upon any such asset, whether by judicial action or otherwise, until the Termination Date (in the case of the assets of any Obligor that is a Domestic Credit Party) or the Foreign Obligations Termination Date (in the case of the assets of any Obligor that is a Foreign Credit Party). If all or any part of the assets of any Obligor, or the proceeds thereof, are subject to any distribution, division or application to the creditors of such Obligor, whether partial or complete, voluntary or involuntary, and whether by reason of liquidation, bankruptcy, arrangement, receivership, assignment for the benefit of creditors or any analogous procedure or step in any jurisdiction or any other action or proceeding, or if the business of any such Obligor is dissolved or if substantially all of the assets of any such Obligor are sold, then, and in any such event (such events being herein referred to as an “Insolvency Event”), any payment or distribution of any kind or character, either in cash, securities or other property, which shall be payable or deliverable upon or with respect to any indebtedness of any Obligor to any Credit Party (“Intercompany Indebtedness”) shall be paid or delivered directly to the Collateral Agent for application to the Secured Obligations in accordance with the Loan Documents (but limited, in the case of any Foreign Credit Party, to the Secured Obligations of the Foreign Borrowers). Should any payment, distribution, security or instrument or proceeds thereof be received by the applicable Credit Party upon or with respect to such Intercompany Indebtedness after any

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Insolvency Event and prior to the Termination Date (in the case of any Intercompany Indebtedness of a Domestic Credit Party) or the Foreign Obligations Termination Date (in the case of any Intercompany Indebtedness of a Foreign Credit Party), such Credit Party shall receive and hold the same in trust, as trustee, for the benefit of the Agents and the Lenders and shall forthwith deliver the same to the Collateral Agent in precisely the form received (except for the endorsement or assignment of such Credit Party where necessary), for application to the Secured Obligations in accordance with the Loan Documents (but limited, in the case of any Foreign Credit Party, to the Secured Obligations of the Foreign Borrowers), and, until so delivered, the same shall be held in trust by such Credit Party as the property of the Agents and the Lenders. If any such Credit Party fails to make any such endorsement or assignment to any Agent, such Agent or any of its officers or employees is irrevocably authorized to make the same. Each Credit Party agrees that until the Termination Date (in the case of any claim against an Obligor that is a Domestic Credit Party) or the Foreign Obligations Termination Date (in the case of any claim against an Obligor that is a Foreign Credit Party), such Credit Party will not assign or transfer to any Person (other than the Collateral Agent, a Credit Party or another Guarantor in accordance with the terms of the Loan Documents) any claim such Credit Party has or may have against any Obligor. It is understood and agreed that, notwithstanding anything to the contrary set forth in this Section 12.5, no Foreign Credit Party shall have any obligation to any Agent or any Lender with respect to any Secured Obligations of any Domestic Credit Party.

12.6	Election of Remedies.

If any Agent or any Lender may, under applicable law, proceed to realize its benefits under any of the Loan Documents giving such Agent or such Lender a Lien upon any Collateral, whether owned by any Borrower or by any other Person, either by judicial foreclosure or by non judicial sale or enforcement, such Agent or such Lender may, at its sole option, determine which of its remedies or rights it may pursue without affecting any of its rights and remedies under this Section 12. If, in the exercise of any of its rights and remedies, any Agent or any Lender shall forfeit any of its rights or remedies, including its right to enter a deficiency judgment against any Borrower or any other Person, whether because of any applicable laws pertaining to “election of remedies” or the like, each Borrower hereby consents to such action by such Agent or such Lender and waives any claim based upon such action, even if such action by such Agent or such Lender shall result in a full or partial loss of any rights of subrogation that each Borrower might otherwise have had but for such action by such Agent or such Lender. Any election of remedies that results in the denial or impairment of the right of any Agent or any Lender to seek a deficiency judgment against any Borrower shall not impair any other Borrower’s obligation to pay the full amount of the Secured Obligations guaranteed hereunder by such Borrower. In the event any Agent or any Lender shall bid at any foreclosure or trustee’s sale or at any private sale permitted by law or the Loan Documents, such Agent or such Lender may bid all or less than the amount of the Secured Obligations and the amount of such bid need not be paid by such Agent or such Lender but shall be credited against the Secured Obligations. The amount of the successful bid at any such sale, whether any Agent, any Lender or any other party is the successful bidder, shall be conclusively deemed to be the fair market value of the Collateral and the difference between such bid amount and the remaining balance of the Secured Obligations shall be conclusively deemed to be the amount of the Secured Obligations guaranteed by the applicable Borrowers under this Section 12, notwithstanding that any present or future law or court decision or ruling may have the effect of reducing the amount of any

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deficiency claim to which any Agent or any Lender might otherwise be entitled but for such bidding at any such sale.

12.7	Liability Cumulative.

The liability of Borrowers under this Section 12 is in addition to and shall be cumulative with all liabilities of each Borrower to the Agents and Lenders under this Agreement and the other Loan Documents to which such Borrower is a party or in respect of any Secured Obligations or obligation of the other Borrowers, without any limitation as to amount, unless the instrument or agreement evidencing or creating such other liability specifically provides to the contrary.

[Remainder of page intentionally left blank.]

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IN WITNESS WHEREOF, this Agreement has been duly executed as of the date first written above.

SOTHEBY’S, a Delaware corporation		OATSHARE LIMITED


By:	/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇	By:	/s/ ▇▇▇▇▇ ▇▇▇▇
Name:	▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇	Name:	▇▇▇▇▇ ▇▇▇▇
Title:	SVP, Treasurer	Title:	Director

SOTHEBY’S, INC.		SOTHEBY’S, a company registered in England


By:	/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇	By:	/s/ ▇▇▇▇▇ ▇▇▇▇
Name:	▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇	Name:	▇▇▇▇▇ ▇▇▇▇
Title:	SVP, Treasurer	Title:	Director

		SOTHEBY’S HONG KONG LIMITED

		By:	/s/ ▇▇▇▇▇ ▇▇
		Name:	▇▇▇▇▇ ▇▇
		Title:	Director

Signature Page to Credit Agreement