823094--3/1/2010--SOTHEBYS

related topics

{condition, economic, financial}

{stock, price, operating}

{cost, contract, operation}

{operation, international, foreign}

{customer, product, revenue}

{financial, litigation, operation}

{cost, operation, labor}

{personnel, key, retain}

{loss, insurance, financial}

{regulation, change, law}

The supply of and demand for works of art can be adversely impacted by weakness in the global economy and the financial markets of various countries. Fluctuations in benchmark interest rates may increase the cost of credit facility borrowings. Government laws and regulations may restrict or limit Sotheby s business. Global political conditions and world events may negatively affect Sotheby s business and customers. Foreign currency exchange rate movements can significantly increase or decrease Sotheby s results of operations. Competition in the international art market is intense and may adversely impact Sotheby s results of operations. Sotheby s cannot be assured of the amount and quality of property consigned for sale at auction, which may cause significant variability in its financial results. The demand for art is unpredictable, which may cause significant variability in Sotheby s financial results. The loss of key personnel could adversely impact Sotheby s ability to compete. Sotheby s relies on a small number of clients who make a significant contribution to its revenues and profitability. Demand for art-related financing is unpredictable, which may cause significant variability in the financial results of Sotheby s Finance segment. The strategic initiatives and restructuring plans being implemented by Sotheby s may not succeed. The value of art is subjective and often fluctuates, exposing Sotheby s to losses in the value of its inventory and loan collateral and significant variability in its financial results. Auction guarantees create the risk of loss resulting from the potential inaccurate valuation of art. Sotheby s could be exposed to credit-related losses in the event of nonperformance by its counterparties in auction guarantee risk and reward sharing arrangements. Future costs and obligations related to the Sotheby s U.K. Pension Plan are dependent on unpredictable factors, which may cause significant variability in employee benefit costs. Tax matters may cause significant variability in Sotheby s financial results. Insurance coverage for artwork may become more difficult to obtain, exposing Sotheby s to losses for artwork in Sotheby s possession.

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