SOTHEBYS HOLDINGS INC
EXHIBIT 10.29
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>13
<FILENAME>ex10-29.htm
<DESCRIPTION>EXHIBIT 10.29
<TEXT>
<HTML>

<HEAD><TITLE></TITLE></HEAD>
<BODY>



<P ALIGN=RIGHT><FONT  SIZE=2><B>EXHIBIT 10.29</B></FONT></P>

<P ALIGN=CENTER><FONT  SIZE=2><U>GUARANTY&nbsp;OF&nbsp;LEASE</U></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;GUARANTY
(this &#147;<U>Guaranty</U>&#148;) made as of this 30th day of June 2006, by SOTHEBY&#146;S, a
Delaware corporation having an address at 1334 York Avenue, New York, NY 10021
(&#147;<U>Guarantor</U>&#148;) to 1334 York Avenue L.P., a Delaware limited partnership
having an address at c/o RFR Holding LLC, 400 Park Avenue, New York, NY 10022
(&#147;<U>Landlord</U>&#148;).</FONT></P>

<P ALIGN=CENTER><FONT  SIZE=2><U>WITNESSETH</U>:</FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS
Sotheby&#146;s Holdings, Inc., a Michigan corporation (the &#147;<U>Existing Guarantor</U>)
previously requested that Landlord enter into a lease with Sotheby&#146;s, Inc., as
tenant (&#147;<U>Tenant</U>&#148;), dated as February 6, 2003 (such lease, together with
any modifications, amendments, extensions and renewals being collectively
called the &#147;<U>Lease</U>&#148;), with respect to that certain parcel of real
property located in the City of New York, State of New York, as is more
particularly described in <U>Schedule A</U> attached hereto and by this
reference made a part hereof, together with the buildings and other
improvements then or thereafter located thereon (capitalized terms not
otherwise defined herein have the meanings specified in the Lease); </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS,
Landlord refused to enter into the Lease unless the Existing Guarantor
guaranteed the performance by Tenant of all of the terms, covenants,
conditions, obligations and agreements contained in the Lease on the part of
Tenant to be performed thereunder (collectively, the &#147;<U>Covenants</U>&#148;),
subject to and in accordance with the terms of that certain Guaranty of Lease
made as of February 6, 2003, by the Existing Guarantor to Landlord (the &#147;<U>Existing
Guaranty</U>&#148;); </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS,
the Existing Guarantor has entered into an Agreement and Plan of Merger between
the Existing Guarantor and Guarantor, a wholly-owned subsidiary of the Existing
Guarantor organized under the laws of the State of Delaware, pursuant to which
the Existing Guarantor will merge with and into the Guarantor, and the
Guarantor will be the surviving corporation; and</FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS,
Section 10 of the Existing Guarantee provides that Existing Guarantor shall not
merge or consolidate with any corporation unless contemporaneously with such
merger the surviving corporation executes and delivers to Landlord a guaranty
of the Lease together with reasonably satisfactory evidence of the due
authorization, execution, delivery, validly and binding effect thereof.</FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;NOW,
THEREFORE, Guarantor agrees with Landlord as follows:</FONT></P>

<HR COLOR=#000000 NOSHADE><P STYLE='PAGE-BREAK-BEFORE: ALWAYS'></P><PAGE>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.
Guarantor unconditionally guaranties to Landlord the prompt payment when due of
the rent, additional rent and other charges payable under the Lease and full
and faithful performance and observance of any and all Covenants (including,
without limitation, the indemnity contained in Section&nbsp;11 of the Lease);
and Guarantor unconditionally covenants to Landlord that if default or breach
shall at any time be made by Tenant in the Covenants to pay rent and additional
rent or any other charges payable under the Lease or in the performance of any
of the other Covenants, and notice of any such default or breach shall have
been given by Landlord to Tenant and Tenant shall not have cured such default
or breach within the grace period, if any, provided for in the Lease, Guarantor
shall well and truly perform the Covenants, and pay said rent, additional rent
or other charges or arrears thereof that may remain due thereon to Landlord,
and also all damages that may arise in consequence of the non-performance of
the Covenants, or any of them, or as the result of the breach of any of the
conditions of limitation set forth in Section 19 of the Lease, including,
without limitation, all damages stipulated in Section 19(b) of the Lease; <U>provided</U>,
<U>however</U>, that Guarantor shall not have any liability in connection with
this Guaranty or the Lease for any consequential or indirect damages (except to
the extent that Tenant incurs liability for such consequential or indirect
damages pursuant to <U>Section 21(b)</U> of the Lease). Guarantor shall pay to
Landlord on demand (or if Guarantor is not an Affiliate of Tenant, within ten
(10) days after written notice to Guarantor) all expenses (including, without
limitation, Landlord&#146;s reasonable out-of-pocket attorneys&#146; fees and
disbursements) of, or incidental to, or relating to the enforcement or
protection of Landlord&#146;s rights hereunder or under the Lease.</FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.
The liability of Guarantor hereunder shall not be impaired, abated, deferred,
diminished, modified, released, terminated or discharged, in whole or in part,
or otherwise affected, by any event, condition, occurrence, circumstance,
proceeding, action or failure to act, with or without notice to, or the
knowledge or consent of, Guarantor, including, without limitation: </FONT></P>

<P><FONT
SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)
any amendment, modification or extension of the Lease or any Covenant;</FONT></P>

<P><FONT
SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)
any extension of time for performance, whether in whole or in part, of any
Covenant given prior to or after default thereunder;</FONT></P>

<P><FONT
SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)
any exchange, surrender or release, in whole or in part, of any security which
may be held by Landlord at any time for or under the Lease;</FONT></P>

<P><FONT
SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)
any other guaranty now or hereafter executed by Guarantor or anyone else;</FONT></P>

<P><FONT
SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)
any waiver of or assertion or enforcement or failure or refusal to assert or
enforce, in whole or in part, any covenant, claim, cause of action, right or
remedy which Landlord may, at any time, have under the Lease or with respect to
any Guarantee or any security which may be held by Landlord at any time for or
under the Lease or with respect to Tenant;</FONT></P>

<HR COLOR=#000000 NOSHADE><P STYLE='PAGE-BREAK-BEFORE: ALWAYS'></P><PAGE>

<P><FONT
SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)
any act or thing or omission or delay to do any act or thing which may in any
manner or to any extent vary the risk of Guarantor or which would otherwise
operate as a discharge of Guarantor as a matter of law;</FONT></P>

<P><FONT
SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)
the release of any other guarantor from liability for the performance or
observance of any Covenant, whether by operation of law or otherwise;</FONT></P>

<P><FONT
SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h)
Landlord&#146;s consent to any assignment or subletting or the assignment or
successive assignments of the Lease by Tenant, or any subletting of the
premises demised under the Lease by Tenant;</FONT></P>

<P><FONT
SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)
the failure to give Guarantor any notice whatsoever;</FONT></P>

<P><FONT
SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j)
any right, power or privilege that Landlord may now or hereafter have against
any person, entity or collateral;</FONT></P>

<P><FONT
SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k)
any assignment, conveyance, mortgage, merger or other transfer, voluntary or
involuntary (whether by operation of law or otherwise), of all or any part of
Tenant&#146;s interest in the Lease, including, without limitation, any assumption
of the Lease by Guarantor pursuant to Section 6 hereof or the occurrence of any
such assignment, conveyance, mortgage, merger or other voluntary or involuntary
transfer which results in Guarantor becoming the tenant under the Lease; or</FONT></P>

<P><FONT
SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l)
any assignment, conveyance, mortgage, merger or other transfer, voluntary or
involuntary (whether by operation of law or otherwise) of all or part of the
interest or rights of Landlord under the Lease.</FONT></P>

<P><FONT
SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
any agreement between Landlord and Tenant shall extend the time of performance
or modify any of the Covenants, Guarantor shall continue to be liable upon this
Guaranty according to the tenor of any such agreement. Notwithstanding the
foregoing, to the extent that Guarantor is not an Affiliate of Tenant,
Guarantor shall not be bound to the extent any amendment, modification,
extension or waiver with respect to an unaffiliated Tenant increases
Guarantor&#146;s obligations hereunder; <U>provided</U>, that the exercise by any
such unaffiliated Tenant of any Extension Option under the Lease shall not be
deemed to be an amendment, modification, extension or waiver thereof.</FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. To
charge Guarantor under this Guaranty no demand shall be required, Guarantor
hereby expressly waiving any such demand; <U>provided</U>, <U>however</U>, that
to the extent that Guarantor is not an Affiliate of Tenant (pursuant to any
assignment of Tenant&#146;s interest in the Lease made in accordance with the
provisions set forth in <U>Sections 17(d),(j),(k),(m),</U> and <U>(s)</U> of
the Lease, any charge to Guarantor under this Guaranty may be made by Landlord
upon ten (10) days prior written notice. Landlord shall have the right to
enforce this Guaranty without pursuing any right or remedy of Landlord against
Tenant or any other party, or any security Landlord may hold, it being intended
that if there occurs any breach or default by Tenant in the performance or
observance of any Covenant and notice of any such default or breach shall have
been given by Landlord to Tenant and Tenant shall have failed to cure such
default or breach within the grace period, if any, provided for in the Lease,
or upon the occurrence of any condition of limitation in the Lease, Guarantor
shall be obligated to Landlord as provided in this </FONT></P>

<HR COLOR=#000000 NOSHADE><P STYLE='PAGE-BREAK-BEFORE: ALWAYS'></P><PAGE>

<P><FONT SIZE=2>Guaranty.
Landlord may commence any action or proceeding based upon this Guaranty
directly against Guarantor without making Tenant or anyone else a party
defendant in such action or proceeding. Any one or more successive and/or
concurrent actions may be brought hereon against Guarantor either in the same
action, if any, brought against Tenant and/or any other party or in separate
actions, as often as Landlord, in its sole discretion, may deem advisable.</FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.
This Guaranty shall be binding upon Guarantor and its successors and assigns,
and shall inure to the benefit of and may be enforced by the successors and
assigns of Landlord or by any party to whom Landlord&#146;s interest in the Lease or
any part thereof, including the rents, may be assigned whether by way of
mortgage or otherwise. Wherever in this Guaranty reference is made to either
Landlord or Tenant, the same shall be deemed to refer also to the then
successor or assign of Landlord or Tenant.</FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.
Guarantor hereby expressly waives and releases (a) notice of the acceptance of
this Guaranty and notice of any change in Tenant&#146;s financial condition; (b) the
right to interpose any substantive or procedural defense of the law of
guarantee, indemnification or suretyship, except the defense of prior payment
or prior performance by Tenant (of the obligations which Guarantor is called
upon to pay or perform under this Guaranty) or any other defense that is
available and that Tenant is entitled to assert under the Lease); (c) all
rights and remedies accorded by applicable law to guarantors or sureties,
including without limitation, any extension of time conferred by any law now or
hereafter in effect; (d) the right to trial by jury, in any action or
proceeding of any kind arising on, under, out of, or by reason of or relating,
in any way, to this Guaranty or the interpretation, breach or enforcement
thereof; (e) the right to interpose any defense (except as allowed under (b)
above), set off or counterclaim of any nature or description in any action or
proceeding; and (f) any right or claim of right to cause a marshalling of
Tenant&#146;s assets or to cause Landlord to proceed against Tenant and/or any
collateral held by Landlord at any time or in any particular order.</FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.
Without limiting Guarantor&#146;s obligations elsewhere under this Guaranty, if
Tenant, or Tenant&#146;s trustee, receiver or other officer with similar powers with
respect to Tenant, rejects, disaffirms or otherwise terminates the Lease
pursuant to any bankruptcy, insolvency, reorganization, moratorium or any other
law affecting creditors&#146; rights generally, Guarantor shall automatically be
deemed to have assumed, from and after the date such rejection, disaffirmance
or other termination of the Lease is deemed effective, all obligations and
liabilities of Tenant under the Lease to the same extent as if Guarantor had
been originally named instead of Tenant as a party to the Lease and the Lease
had never been so rejected, disaffirmed or otherwise terminated. Guarantor,
upon such assumption, shall be obligated to perform and observe all of the
Covenants whether theretofore accrued or thereafter accruing and Guarantor
shall be subject to any rights or remedies of Landlord which may have
theretofore accrued or which may thereafter accrue against Tenant on account of
any default under the Lease, notwithstanding that such defaults existed prior
to the date Guarantor was deemed to have automatically assumed the Lease or
that such rights or remedies are unenforceable against Tenant by reason of such
rejection, dissaffirmance or other termination. Guarantor shall confirm such
assumption in writing at the request of Landlord upon or after such rejection,
dissaffirmance or other termination, but the failure to do so shall not affect
such assumption. Guarantor, upon the assumption of the Lease, shall have all of
the rights of Tenant under the Lease (to the extent permitted by law). Neither
Guarantor&#146;s obligation to make payment in </FONT></P>

<HR COLOR=#000000 NOSHADE><P STYLE='PAGE-BREAK-BEFORE: ALWAYS'></P><PAGE>

<P><FONT SIZE=2>accordance
with this Guaranty nor any remedy for the enforcement thereof shall be
impaired, modified, changed, stayed, released or limited in any manner by any
impairment, modification, change, release, limitation or stay of the liability
of Tenant or its estate in bankruptcy or any remedy for the enforcement
thereof, resulting from the operation of any present or future provision of the
Bankruptcy Code of the United States or other statute or from the decision of
any court interpreting any of the same, and Guarantor shall be obligated under
this Guaranty as if no such impairment, stay, modification, change, release or
limitation had occurred.</FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)
This Guaranty and all rights, obligations and liabilities arising hereunder
shall be construed according to the laws of the State of New York. Guarantor
hereby irrevocably submits, to the extent permitted by applicable law, to the
non-exclusive jurisdiction of (i) the United States Courts for the Southern
District of New York, or the courts of the State of New York, in any action or
proceeding arising out of or relating to this Guaranty, and Guarantor hereby
irrevocably agrees that all claims against it in respect of such action or
proceeding against Guarantor may be heard and determined in such courts.
Guarantor hereby appoints Sotheby&#146;s, Inc. as its attorney-in-fact and agent in
its name, place and stead to accept service of legal process in any such action
or proceeding in any court described above, and consents that service of legal
process in any such action or proceeding may be made upon it by service upon Sotheby&#146;s,
Inc. To the extent permitted by applicable law, Guarantor agrees that a final
judgment obtained in any court described above in any action or proceeding
shall be conclusive and may be enforced in other jurisdictions by suit on the
judgment or in any other manner provided by law.</FONT></P>

<P><FONT
SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)
Nothing in this <U>Section&nbsp;7</U> shall affect the right of Landlord to
serve legal process in any other manner permitted by law. Guarantor hereby
consents that service of process by registered or certified mail, return
receipt requested, addressed to Guarantor at the address hereinabove set forth
will be sufficient.</FONT></P>

<P><FONT
SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)
To the extent that Guarantor has or hereafter may acquire any immunity from
jurisdiction of any such court referred to in <U>clause&nbsp;(a)(i)</U> or <U>(a)(ii)</U>
above or from any legal process (whether through service or notice, attachment
prior to judgment, attachment in aid of execution, execution or otherwise) with
respect to itself or its property, to the extent permitted by applicable law,
Guarantor hereby irrevocably waives such immunity in respect of its obligations
under this Guaranty.</FONT></P>

<P><FONT
SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)
Guarantor hereby irrevocably waives, to the extent permitted by applicable law,
any objection, including, without limitation, any objection to the laying of
venue or based on the grounds of <U>forum&nbsp;non&nbsp;conveniens</U>, that
Guarantor may now or hereafter have to the bringing of any such action or
proceeding in such respective courts referred to in <U>clauses (a)(i)</U> and <U>(a)(ii)</U>
above.</FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.
Guarantor hereby waives any and all rights of subrogation (if any) which it may
have against Tenant as a result of actions taken or amounts paid in connection
with or relating to this Guaranty or to the Lease until all of Guarantor&#146;s
obligations hereunder are satisfied or Guarantor is released pursuant to <U>Section
16</U> below.</FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.
Guarantor represents and warrants to Landlord that as of the date hereof:</FONT></P>

<HR COLOR=#000000 NOSHADE><P STYLE='PAGE-BREAK-BEFORE: ALWAYS'></P><PAGE>

<P><FONT
SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)
Guarantor has full power, authority and legal right to execute, deliver,
perform and observe this Guaranty, including, without limitation, the payment
of all moneys hereunder.</FONT></P>

<P><FONT
SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)
The execution, delivery and performance by Guarantor of this Guaranty have been
duly authorized by all necessary corporate action.</FONT></P>

<P><FONT
SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)
This Guaranty constitutes the legal, valid and binding obligation of Guarantor,
enforceable in accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization, and other laws affecting creditors&#146; rights
generally, to moratorium laws from time to time in effect and to general
principles of equity (regardless of whether enforceability is considered in a
proceeding in equity or at law).</FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.
 Guarantor shall not merge or
consolidate with any corporation or sell all or substantially all of its assets
unless either (a) Guarantor shall be the surviving corporation or (b)
contemporaneously with such merger or consolidation or sale, the surviving or
purchasing corporation executes and delivers to Landlord a guaranty of the
Lease, substantially in the form and substance of this Guaranty, together with
reasonably satisfactory evidence of the due authorization, execution, delivery,
validity and binding effect thereof, but whether or not such execution and
delivery shall take place the surviving or purchasing corporation shall be
bound by this Guaranty as if it had so executed and delivered such guaranty.</FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.
 If Landlord shall be obligated by
reason of any bankruptcy, insolvency or other legal proceeding to pay or repay
to Tenant or to Guarantor or to any trustee, receiver or other representative
of either of them, any amounts previously paid by Tenant or Guarantor pursuant
to the Lease or this Guaranty, Guarantor shall reimburse Landlord for any such
payment or repayment and this Guaranty shall extend to the extent of such
payment or repayment made by Landlord, except to the extent, if any, that such
payment or repayment is prohibited by law or that such payment or repayment
constitutes merely a reimbursement of any overpayment. Landlord shall not be
required to litigate or otherwise dispute its obligation or make such payment
or repayment if in good faith and on written advice of counsel Landlord
believes that such obligation exists.</FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.
 Landlord and Guarantor shall each, at
any time and from time to time, within ten (10) business days following request
by the other, execute, acknowledge and deliver to the other a statement
certifying that this Guaranty is unmodified and in full force and effect (or if
there have been modifications, that the same is in full force and effect as
modified and stating such modifications) and that to the best of the certifying
party&#146;s knowledge, Guarantor is not in default hereunder (or if there is such a
default, describing such default in reasonable detail).</FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.
 All remedies afforded to Landlord by
reason of this Guaranty or the Lease, or otherwise available at law or in
equity, are separate and cumulative remedies and no one remedy, whether or not
exercised by Landlord, shall be deemed to be in exclusion of any other remedy
available to Landlord and shall not limit or prejudice any other legal or
equitable remedy which Landlord may have.</FONT></P>

<HR COLOR=#000000 NOSHADE><P STYLE='PAGE-BREAK-BEFORE: ALWAYS'></P><PAGE>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.
 If any term, covenant, condition or
provision of this Guaranty or the application thereof to any circumstance or to
Guarantor shall be invalid or unenforceable to any extent, the remaining terms,
covenants, conditions and provisions of this Guaranty or the application
thereof to any circumstances or to Guarantor other than those as to which any
term, covenant, condition or provision is held invalid or unenforceable, shall
not be affected thereby and each remaining term, covenant, condition and
provision of this Guaranty shall be valid and shall be enforceable to the
fullest extent permitted by law.</FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15.
 Any notice hereunder shall be in
writing and personally delivered or sent by certified or registered mail,
return receipt requested to Landlord or Guarantor at their respective addresses
hereinabove set forth or such other address designated by Landlord or Guarantor
by ten (10) days prior notice. Any notice hereunder to be delivered to
Guarantor by Landlord shall also delivered to Tenant concurrently at the
following address (or such other address designated by Tenant by ten (10) days
prior notice):</FONT></P>

<TABLE ALIGN=CENTER  BORDER=0 CELLSPACING=0 CELLPADDING=0 WIDTH="100%">
 <TR style="font-size:1px">
  <TD WIDTH="5%" VALIGN=TOP>
  <P>&nbsp;</P>
  </TD>
  <TD WIDTH="95%" VALIGN=TOP>
  <P>&nbsp;</P>
  </TD>
 </TR>
 <TR>
  <TD  VALIGN=TOP>
  <P><FONT SIZE=1>&nbsp;</FONT></P>
  </TD>
  <TD  VALIGN=TOP>
  <P><FONT SIZE=2>Sotheby&#146;s,
  Inc.</FONT></P>
  </TD>
 </TR>
 <TR>
  <TD  VALIGN=TOP>
  <P><FONT SIZE=1>&nbsp;</FONT></P>
  </TD>
  <TD  VALIGN=TOP>
  <P><FONT SIZE=2>1334 York
  Avenue</FONT></P>
  </TD>
 </TR>
 <TR>
  <TD  VALIGN=TOP>
  <P><FONT SIZE=1>&nbsp;</FONT></P>
  </TD>
  <TD  VALIGN=TOP>
  <P><FONT SIZE=2>New York,
  New York 10021</FONT></P>
  </TD>
 </TR>
 <TR>
  <TD  VALIGN=TOP>
  <P><FONT SIZE=1>&nbsp;</FONT></P>
  </TD>
  <TD  VALIGN=TOP>
  <P><FONT SIZE=2>Attention:
  General Counsel</FONT></P>
  </TD>
 </TR>
</TABLE>

<P><FONT SIZE=2>Any
notice shall be deemed given as of the date of delivery as indicated by
affidavit in case of personal delivery or by the return receipt in the case of
mailing; and in the event of failure to deliver by reason of changed address of
which no notice is given or refusal to accept delivery, as of the date of such
failure as indicated by affidavit or return receipt as aforesaid.</FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16.
Notwithstanding anything in this Guaranty to the contrary, Guarantor shall be
released from its obligations hereunder (a) upon the satisfaction of all of the
conditions set forth in <U>Sections17(n)(2)</U> or <U>17(n)(3)</U> of the
Lease, as the case may be, and (b) only to the extent such obligations accrue
on or after the date of such release.</FONT></P>

<HR COLOR=#000000 NOSHADE><P STYLE='PAGE-BREAK-BEFORE: ALWAYS'></P><PAGE>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN
WITNESS WHEREOF, Guarantor has executed this Guaranty as of the day and year
first above written.</FONT></P>

<TABLE ALIGN=CENTER  BORDER=0 CELLSPACING=0 CELLPADDING=0 WIDTH="100%">
 <TR style="font-size:1px">
  <TD WIDTH="50%" VALIGN=TOP>
  <P>&nbsp;</P>
  </TD>
  <TD WIDTH="3%" VALIGN=TOP>
  <P>&nbsp;</P>
  </TD>
  <TD WIDTH="46%" VALIGN=TOP>
  <P>&nbsp;</P>
  </TD>
 </TR>
 <TR>
  <TD  VALIGN=TOP>
  <P><FONT SIZE=1>&nbsp;</FONT></P>
  </TD>
    <TD  VALIGN=TOP colspan=2>
  <P><FONT SIZE=2>SOTHEBY&#146;S, a
  Delaware corporation</FONT></P>
  </TD>
 </TR>
 <TR>
  <TD  VALIGN=TOP>
  <P><FONT SIZE=1>&nbsp;</FONT></P>
  </TD>
  <TD  VALIGN=TOP>
  <P><FONT SIZE=1>&nbsp;</FONT></P>
  </TD>
  <TD  VALIGN=TOP>
  <P><FONT SIZE=1>&nbsp;</FONT></P>
  </TD>
 </TR>
 <TR>
  <TD  VALIGN=TOP>
  <P><FONT SIZE=1>&nbsp;</FONT></P>
  </TD>
  <TD  VALIGN=TOP>
  <P><FONT SIZE=2>By:</FONT></P>
  </TD>
    <TD  VALIGN=TOP> <P><FONT SIZE=2>&nbsp;/s/ William F. Ruprecht</FONT></P>
  </TD>
 </TR>
 <TR>
  <TD  VALIGN=TOP>
  <P><FONT SIZE=1>&nbsp;</FONT></P>
  </TD>
  <TD  VALIGN=TOP>
  <P><FONT SIZE=1>&nbsp;</FONT></P>
  </TD>
  <TD  VALIGN=TOP>
  <HR SIZE=1 WIDTH="60%" NOSHADE ALIGN=left>

  </TD>
 </TR>
 <TR>
  <TD  VALIGN=TOP>
  <P><FONT SIZE=1>&nbsp;</FONT></P>
  </TD>
  <TD  VALIGN=TOP>
  <P><FONT SIZE=1>&nbsp;</FONT></P>
  </TD>
  <TD  VALIGN=TOP>
  <P><FONT SIZE=2>Name:
  William F. Ruprecht</FONT></P>
  </TD>
 </TR>
 <TR>
  <TD  VALIGN=TOP>
  <P><FONT SIZE=1>&nbsp;</FONT></P>
  </TD>
  <TD  VALIGN=TOP>
  <P><FONT SIZE=1>&nbsp;</FONT></P>
  </TD>
  <TD  VALIGN=TOP>
  <P><FONT SIZE=2>Title:
  President and Chief Executive Officer</FONT></P>
  </TD>
 </TR>
</TABLE>
<BR>
<HR COLOR=#000000 NOSHADE>



</BODY>

</HTML>
</TEXT>
</DOCUMENT>
