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Exhibit 10(s)
SOTHEBY'S HOLDINGS, INC.
2003 RESTRICTED STOCK PLAN
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SOTHEBY'S HOLDINGS, INC.
2003 RESTRICTED STOCK PLAN
TABLE OF CONTENTS
<Table>
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PAGE
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ARTICLE 1 PURPOSE OF THE PLAN, ADOPTION AND TERM...................... 1
1.1 Purpose of the Plan......................................... 1
1.2 Adoption and Term........................................... 1
ARTICLE 2 DEFINITIONS................................................. 1
ARTICLE 3 ADMINISTRATION.............................................. 4
3.1 Administration.............................................. 4
3.2 Expenses of Administration.................................. 4
3.3 Indemnification............................................. 4
ARTICLE 4 SHARES OF COMMON STOCK SUBJECT TO THE PLAN.................. 5
4.1 Shares Subject to the Plan.................................. 5
4.2 Restricted Stock Subject to Forfeited or Terminated
Awards.................................................... 5
4.3 Exchange of Options for Restricted Stock.................... 5
ARTICLE 5 PARTICIPATION............................................... 5
ARTICLE 6 RESTRICTED STOCK............................................ 5
6.1 Grant of Restricted Stock................................... 5
6.2 Restrictions................................................ 6
6.3 Restricted Stock Shares Certificates........................ 6
6.4 Voting and Dividend Rights.................................. 6
ARTICLE 7 TERMS AND CONDITIONS OF RESTRICTED STOCK.................... 6
7.1 Award Agreements............................................ 6
7.2 Plan Provisions Control Terms............................... 6
7.3 Vesting..................................................... 6
7.4 Acceleration of Vesting..................................... 7
7.5 Taxes and Withholding....................................... 7
7.6 Surrender of Restrictions................................... 7
7.7 Restrictions on Ownership of Class B Common Stock;
Incorporation by Reference of Articles of Incorporation... 7
7.8 Issuance of Class A Common Stock............................ 7
ARTICLE 8 AMENDMENT AND TERMINATION OF THE PLAN; REORGANIZATIONS AND
RECAPITALIZATIONS OF THE CORPORATION...................... 8
8.1 Amendment of the Plan....................................... 8
8.2 Termination of the Plan..................................... 8
8.3 Reorganizations and Recapitalizations of the Corporation.... 8
ARTICLE 9 COMPLIANCE WITH OTHER LAWS AND REGULATIONS.................. 8
9.1 Registration or Qualification of Securities................. 8
9.2 Representation.............................................. 8
9.3 Exchange of Certificates.................................... 9
ARTICLE 10 RESTRICTIONS ON TRANSFER.................................... 9
</Table>
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ARTICLE 11 GENERAL PROVISIONS.......................................... 9
11.1 No Right to Continued Employment............................ 9
11.2 Beneficiaries or Representatives of a Participant........... 9
11.3 Elimination of Fractional Shares............................ 9
11.4 Inspection of Records....................................... 9
11.5 Word Meanings............................................... 9
11.6 Section Titles.............................................. 9
11.7 Severability................................................ 10
11.8 Compliance with Section 16(b) of the Securities Exchange
Act....................................................... 10
11.9 Compliance with Code Section 162(m)......................... 10
11.10 Strict Construction......................................... 10
11.11 Choice of Law............................................... 10
</Table>
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SOTHEBY'S HOLDINGS, INC.
2003 RESTRICTED STOCK PLAN
ARTICLE 1
PURPOSE OF THE PLAN, ADOPTION AND TERM
1.1 Purpose of the Plan. The Plan shall be called the Sotheby's Holdings,
Inc. 2003 Restricted Stock Plan (the 'Plan'). The purpose of the Plan is to
promote the interests of the Company and its shareholders by (i) providing
certain Employees of the Corporation with additional incentives to continue and
increase their efforts with respect to achieving success in the business of the
Corporation and its Subsidiaries, (ii) attracting and retaining the best
available personnel to participate in the ongoing business operations of the
Corporation and its Subsidiaries, and (iii) issuing shares of the Corporation's
Class B Common Stock in exchange for the cancellation of certain stock options
previously granted under the Sotheby's Holdings, Inc. 1987 and 1997 Stock Option
Plans.
1.2 Adoption and Term. The Plan has been approved by the Board of Directors
of the Corporation and, subject to the approval of a majority of the voting
power of the shareholders of the Corporation, is effective May 1, 2003. The Plan
will remain in effect until terminated or abandoned by action of the Board of
Directors.
ARTICLE 2
DEFINITIONS
In the Plan, whenever the context so indicates, the singular or plural
number, and the masculine, feminine or neuter gender shall each be deemed to
include the other, the terms 'he,' 'his,' and 'him' shall refer to a
Participant, and the capitalized terms shall have the following meanings:
2.1 'Articles of Incorporation' means the Amended and Restated Articles of
Incorporation of the Corporation, as the same may be amended from time to time.
2.2 'Award' means individually or collectively, a grant of Restricted Stock
under this Plan.
2.3 'Award Agreement' means an agreement entered into by each Participant
and the Corporation, setting forth the terms and provisions applicable to Awards
granted to Participants under the Plan.
2.4 'Beneficiary' means (i) an individual, trust, or estate, who or which,
by will or by operation of the laws of descent and distribution, succeeds to the
rights and obligations of a Participant under the Plan upon the Participant's
death; or (ii) an individual who, as a result of designation by a Participant,
succeeds to the rights and obligations of such Participant under the Plan and
the Award Agreement upon such Participant's death.
2.5 'Board of Directors' means the Board of Directors of the Corporation or
the Executive Committee of the Board.
2.6 'Business Day' means any Day on which the New York Stock Exchange is
open for trading.
2.7 'Class A Common Stock' means the Class A Limited Voting Common Stock of
the Corporation, par value $0.10 per share, entitling every holder thereof, on
all matters submitted to a vote of the shareholders of the Corporation, to cast
one vote for each share standing in his name.
2.8 'Class B Common Stock' means the Class B Common Stock of the
Corporation, par value $0.10 per share, entitling every holder thereof, on all
matters submitted to a vote of the shareholders of the Corporation, to cast 10
votes for each share standing in his name.
2.9 'Code' means the Internal Revenue Code of 1986, as amended from time to
time (or any corresponding provisions of succeeding law).
2.10 'Common Stock' means the Class A Common Stock and the Class B Common
Stock.
2.11 'Compensation Committee' or 'Committee' means the Compensation
Committee established by the Board of Directors, or such other committee as the
Board may establish and assign the responsibility of administering this Plan.
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2.12 'Confidential Information' means, with respect to the Corporation and
its Subsidiaries, any confidential information regarding the financial situation
and particular needs of the Corporation and its Subsidiaries as well as of, or
relating to, their customers and clients (including, without limitation,
consignors, buyers and principals), the identity of such Persons, client lists,
documents and information regarding the Corporation's and any Subsidiary's sales
data, marketing, operational and appraisal techniques, contracts, pricing, costs
and profits, and any other information maintained as proprietary or as trade
secrets or as confidential.
2.13 'Corporation' means Sotheby's Holdings, Inc., a Michigan corporation,
and any successor in interest to the business of the Corporation that has, by
agreement, adopted the Plan.
2.14 'Date of Grant', with respect to an Award, means the date on which the
Compensation Committee grants such Award pursuant to the Plan.
2.15 'Day' means each calendar day, including Saturdays, Sundays, and legal
holidays; provided, however, that if the Day on which a period of time for
consent or approval or other action ends is not a Business Day, such period
shall end on the next Business Day.
2.16 'Disability' or 'Disabled' means, with respect to an Employee, a
physical or mental condition resulting from any medically determinable physical
or mental impairment that renders such Employee incapable of engaging in any
substantial gainful employment and that can be expected to result in death or
that has lasted or can be expected to last for a continuous period of not less
than three hundred sixty-five (365) Days. Certain conditions are excluded from
the definition of Disability. The Disability of an Employee and the date upon
which an Employee ceases to be employed by reason of Disability shall be
determined by the Compensation Committee in accordance with uniform principles
consistently applied, upon the basis of such evidence as the Compensation
Committee deems necessary and desirable, and its good faith determination shall
be conclusive for all purposes of this Plan and the relevant Award Agreement.
2.17 'Eligible Options' means those Options previously granted under the
Stock Option Plan which are eligible for exchange under an Exchange Offer.
2.18 'Employee' means an individual who is and continues to be employed
(within the meaning of section 3401 of the Code and the regulations promulgated
thereunder) by the Corporation or a Subsidiary (while a corporation continues to
be a Subsidiary) including officers (whether or not they may also be directors)
of the Corporation or a Subsidiary. An Employee shall cease to be an Employee
upon the voluntary or involuntary termination of his employment with the
Corporation or a Subsidiary for any reason, including death, Disability,
Retirement, or with or without cause. Whether an authorized leave of absence, or
an absence due to military or government service, Disability, or any other
reason, constitutes a cessation of employment shall be determined by the
Compensation Committee, in its sole discretion.
2.19 'Exchange Act' means the Securities Exchange Act of 1934, as amended.
2.20 'Exchange Offer' means an offer to exchange underwater Options for
shares of Restricted Stock pursuant to such terms and conditions as the
Compensation Committee may approve.
2.21 'Fair Market Value' means the value of each share of Restricted Stock,
determined for a particular date as follows:
(a) if the Class B Common Stock is listed or admitted for trading on any
United States national securities exchange, the value of each share of
Restricted Stock shall be the closing price per share of Class B Common
Stock on such exchange (or, if listed on more than one United States
exchange, the principal said exchange) on the relevant Valuation Date
hereunder;
(b) if the Class B Common Stock is not traded on any United States
national securities exchange, but is quoted on the National Association of
Securities Dealers, Inc. Automated Quotation System (the 'NASDAQ System') or
any similar system of automated dissemination of quotations of prices in
common use, the value of each share of Restricted Stock shall be the price
per share equal to the mean between the closing high bid and the low asked
quotations on such system on the relevant Valuation Date hereunder;
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(c) if neither clause (a) nor clause (b) of this definition is
applicable with respect to the Class B Common Stock, but either clause (a)
or clause (b) is applicable with respect to the Class A Common Stock, the
value of each share of Restricted Stock shall be the closing price as
described in clause (a) above or the mean between the closing high bid and
the low asked quotations as described in clause (b) above, respectively, of
the Class A Common Stock, as the case may be; or
(d) if neither paragraph (a) nor paragraph (b) nor paragraph (c) of this
definition is applicable, the value of each share of Restricted Stock shall
be the fair market value as determined by the Committee, in good faith and
in accordance with uniform principles consistently applied, on the last day
of the relevant Fiscal Year immediately preceding the relevant date
hereunder.
(e) for purposes of determining taxation of the Restricted Stock issued
to U.K. employees, the definition of Fair Market Value may be adjusted as
required by the Shares Valuation Division of the U.K. Inland Revenue.
2.22 'Fiscal Year' means the fiscal year of the Corporation.
2.23 'Fractional Share' means a portion of, or less than the whole of, a
share of Common Stock.
2.24 'Option' means an Option granted under the Stock Option Plan.
2.25 'Optionee' means an individual who has outstanding Option grants under
the Stock Option Plan.
2.26 'Participant' means an Employee who has an outstanding Award granted
under this Plan.
2.27 'Period of Restriction' means the period during which the transfer of
shares of Restricted Stock is limited in some way (based on the passage of time,
the achievement of performance goals, or upon the occurrence of other events as
determined by the Compensation Committee, in its discretion), and the shares are
subject to substantial risk of forfeiture, as provided in Sections 6.2 and/or
7.3.
2.28 'Person' or 'Persons' means an individual, a partnership (general or
limited), corporation, joint venture, business trust, cooperative, association,
or other form of business organization, whether or not regarded as a legal
entity under applicable law, a trust (inter vivos or testamentary), an estate of
a deceased, insane, or incompetent person, a quasi-governmental entity, a
government or any agency, authority, political subdivision, or other
instrumentality thereof, or any other entity.
2.29 'Plan' means the Sotheby's Holdings, Inc. 2003 Restricted Stock Plan,
as amended from time to time.
2.30 'Reporting Person' means any and all Employees subject to Section 16 of
the Exchange Act.
2.31 'Restricted Stock' means those shares of Class B Common Stock made the
subject of any Award granted pursuant to the Plan.
2.32 'Retirement' means the termination of employment by an Employee after
the attainment of the age of sixty-five (65) years or upon such earlier date as
required by local law or as otherwise determined or approved by the Compensation
Committee.
2.33 'Section 162(m) Subcommittee' shall be a Subcommittee of the
Compensation Committee comprised solely of two or more members of the Board, as
determined by the Board from time to time, each of whom shall be (i) a
'disinterested person' as that term is defined and interpreted pursuant to Rule
16b-3 promulgated under Section 16 of the Exchange Act and (ii) an 'outside
director' as that term is defined and interpreted pursuant to section 162(m) of
the Code and the regulations thereunder. The purpose of the Section 162(m)
Subcommittee is to approve Restricted Stock Awards to covered employees (as
defined in Code Section 162(m)) so that the Restricted Stock can qualify as
performanced-based compensation under Code Section 162(m).
2.34 'Securities Act' means the Securities Act of 1933, as amended.
2.35 'Stock Option Plan' means the Sotheby's Holdings, Inc. 1987 and 1997
Stock Option Plans.
2.36 'Subsidiary' means any corporation at least 50% of the total combined
voting power of which is owned by the Corporation or another Subsidiary.
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2.37 'Transfer' means any assignment, sale, transfer, conveyance, mortgage
or other encumbrance, pledge, or other disposition or act of alienation, whether
voluntary or involuntary, or by operation of law.
2.38 'Valuation Date' means, with respect to an Award of Restricted Stock,
the Business Day immediately preceding either the Date of Grant of such Award,
or the vesting date or other event applicable to such Award. The Valuation Date
for the issuance of Restricted Stock in connection with an Exchange Offer shall
be the date specified in the Exchange Offer documents. Whenever reference is
made to a Valuation Date, it shall mean, with respect to the Common Stock, the
value at the close of trading on such Valuation Date, and with respect to any
other item, midnight in Detroit, Michigan at the end of such Valuation Date.
ARTICLE 3
ADMINISTRATION
3.1 Administration. The Plan shall be administered by the Committee in
accordance with this Article 3. Subject to the terms and conditions of the Plan,
the Committee or the Section 162(m) Subcommittee as applicable shall have the
sole discretionary authority:
(a) to authorize the granting of Restricted Stock Awards;
(b) to select any Reporting Persons who are to be granted Restricted
Stock under the Plan and to determine, subject to the limitations provided
in Section 6.1 hereof, the number of shares of Restricted Stock to be
granted to each Reporting Person;
(c) to construe and interpret the Plan;
(d) to establish and modify administrative rules for the Plan;
(e) to impose such conditions and restrictions with respect to the
Restricted Stock Awards, not inconsistent with the terms of the Plan, as it
determines appropriate;
(f) to execute or cause to be executed Award Agreements; and
(g) generally, to exercise such power and perform such other acts in
connection with the Plan and the Awards and to make all determinations under
the Plan as it may deem necessary or advisable or as required, provided or
contemplated hereunder.
Action taken or not taken by the Compensation Committee on one or more
occasions shall be without obligation to take or not take such action on any
other occasion(s).
The Committee may delegate to one or more Persons any of its powers, other
than its power to authorize the granting of Awards, hereinbefore or hereinafter
provided or conferred, or designate one or more Persons to do or perform those
matters to be done or performed by the Compensation Committee, including
administration of the Plan. Notwithstanding the foregoing, the Committee may not
delegate a power if the delegation of such power would cause the Plan to fail to
satisfy the plan administration requirements set forth in Rule 16b-3(c)
promulgated under the Exchange Act or section 162(m) of the Code and the
regulations promulgated thereunder. Any Person or Persons delegated or
designated by the Committee shall be subject to the same obligations and
requirements imposed on the Committee and its members under the Plan.
3.2 Expenses of Administration. The Corporation shall pay all costs and
expenses of administering the Plan.
3.3 Indemnification. The Committee, members of the Committee, and each
Person or Persons designated or delegated by the Committee, and the
shareholders, directors and officers of the Corporation, shall be entitled to
indemnification and reimbursement from the Corporation for any action or any
failure to act in connection with services performed by or on behalf of the
Committee for the benefit of the Corporation to the fullest extent provided or
permitted by the Corporation's Articles of Incorporation and by any insurance
policy or other agreement intended for the benefit of the Committee as a
committee of the Board of Directors or otherwise, or by any applicable law.
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ARTICLE 4
SHARES OF COMMON STOCK SUBJECT TO THE PLAN
4.1 Shares Subject to the Plan. The Restricted Stock to be made the subject
of Awards granted under the Plan shall be shares of the Corporation's authorized
but unissued or reacquired Class B Common Stock. Subject to adjustment as
provided in Section 8.3 hereof, the aggregate number of shares of Class B Common
Stock that may be issued by the Corporation under the Plan is 2,000,000 shares
of Class B Common Stock. The aggregate number of shares of Restricted Stock
outstanding at any time shall not exceed the relevant number of shares of Class
B Common Stock remaining available for issuance under the Plan.
4.2 Restricted Stock Subject to Forfeited or Terminated Awards. In the event
that any Restricted Stock with respect to an outstanding Award is forfeited,
surrendered, expires or is terminated for any reason before the Period of
Restriction has been satisfied, all shares of Restricted Stock allocable to the
forfeited or terminated portion of such Award shall again be available for
Awards subsequently granted under the Plan.
4.3 Exchange of Options for Restricted Stock. Employees who were previously
granted certain Options under the Stock Option Plan may have a choice to
exchange those Options for Restricted Stock under the Plan pursuant to a
pre-determined conversion ratio as approved by the Compensation Committee (the
'Exchange Offer'). Options eligible for the exchange ('Eligible Options') will
also be determined by the Compensation Committee prior to the Date of Grant.
Only those Optionees who satisfy the following criteria are eligible for the
exchange:
(a) Optionee must be actively employed by the Corporation or a
Subsidiary (or on an approved leave of absence) on the Date of Grant and
must not either have given notice of termination of employment or received
notice of termination of employment as of the Date of Grant; and
(b) Optionee must hold a certain number of Eligible Options which are
unexercised and outstanding (i.e., have not expired). The number shall be
determined by the Compensation Committee.
An Optionee who satisfies the criteria under this Section 4.3 may have a
choice to exchange all Eligible Options; no partial exchange is permitted. The
number of Eligible Options and the number of shares of Restricted Stock granted
in exchange for cancellation of the Eligible Options will be set forth in the
Award Agreement for each Participant. Any Options which are exchanged for
Restricted Stock pursuant to this Section 4.3 shall be cancelled. Restricted
Stock granted in exchange for the cancelled Options shall be subject to all of
the terms and conditions of this Plan.
ARTICLE 5
PARTICIPATION
Plan Participants shall be such Employees as the Compensation Committee may
select (who may include officers). In making such selections, the Committee may
take into account the nature of the services rendered by such Employees, their
present and potential contributions to the Corporation's success, and such other
factors as the Committee in its discretion shall deem relevant.
ARTICLE 6
RESTRICTED STOCK
6.1 Grant of Restricted Stock. The Compensation Committee will cause the
Corporation to issue Restricted Stock under the Plan in connection with an
Exchange Offer described in Article 4. The Compensation Committee may also from
time to time cause the Corporation to issue additional shares of Restricted
Stock under the Plan, subject to such restrictions, conditions and other terms
as the Compensation Committee may determine in addition to those set forth
herein. The maximum aggregate number of shares of Restricted Stock which may be
granted to any one Employee during a Fiscal Year shall be limited to 200,000
shares. For purposes of calculating the maximum number of shares of
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Restricted Stock granted in any Fiscal Year to an Employee who is subject to
Code Section 162(m), any shares that are granted and subsequently cancelled or
surrendered during such Fiscal Year shall continue to be counted against the
maximum number of shares which may be granted to such Employee pursuant to the
Plan during such Fiscal Year. Notwithstanding the foregoing, to the extent an
adjustment is made to the Common Stock to reflect a change in the corporate
capitalization of the Corporation, the additional shares of Restricted Stock, if
any, shall not be counted against the maximum number of shares which may be
granted to the Participant.
6.2 Restrictions. The Restricted Stock issued in connection with an Exchange
Offer shall be subject to the vesting schedule under Section 7.3 or such other
vesting schedule as the Compensation Committee determines. Restricted Stock
grants other than those made pursuant to an Exchange Offer, if any, will also be
subject to vesting under Section 7.3 unless the Compensation Committee
establishes a different Period of Restriction applicable to such Restricted
Stock. Each grant of Restricted Stock may be subject to a different Period of
Restriction as specified in the Award Agreement. The Compensation Committee may,
in its sole discretion, at the time a grant is made, prescribe restrictions in
addition to or other than the expiration of the Period of Restriction, including
the satisfaction of corporate or individual performance objectives, which shall
be applicable to all or any portion of the Restricted Stock. Such restrictions
shall be set forth in the Participant's Award Agreement.
Except with respect to grants of Restricted Stock intended to qualify as
performance based compensation for purposes of Section 162(m) of the Code, the
Compensation Committee may also, in its sole discretion, shorten or terminate
the Period of Restriction or waive any other restrictions applicable to all or a
portion of such Restricted Stock. None of the Restricted Stock may be sold,
transferred, assigned, pledged or otherwise encumbered or disposed of prior to
the date on which such Restricted Stock vests in accordance with Section 7.3.
6.3 Restricted Stock Share Certificates. Restricted Stock awarded to a
Participant may be held under the Participant's name in a book entry account
maintained by or on behalf of the Corporation. Upon vesting of the Restricted
Stock, the Corporation will establish procedures regarding the delivery of share
certificates or the transfer of shares in book entry form.
6.4 Voting and Dividend Rights. Except as otherwise determined by the
Committee either at the time Restricted Stock is awarded or at any time
thereafter prior to the lapse of the restrictions, holders of Restricted Stock
shall have the right to vote such shares and the right to receive any dividends
with respect to such shares, whether or not the shares of Restricted Stock are
vested. All distributions, if any, received by an Employee with respect to
Restricted Stock as a result of any stock split, stock distributions,
combination of shares, or other similar transaction shall be subject to the
restrictions of the Plan.
ARTICLE 7
TERMS AND CONDITIONS OF RESTRICTED STOCK
7.1 Award Agreements. The terms of the Restricted Stock granted under the
Plan shall be as set forth in a written agreement (an 'Award Agreement') in such
form as the Committee shall from time to time determine. Each Award Agreement
shall comply with and be subject to the terms and conditions of the Plan and
such other terms and conditions as the Committee may deem appropriate. No Person
shall have any rights under the Plan unless and until the Corporation and the
Participant have executed an Award Agreement setting forth the grant and the
terms and conditions of the Restricted Stock.
7.2 Plan Provisions Control Terms. The terms of the Plan shall govern all
Restricted Stock granted under the Plan. In the event that any provision of an
Award Agreement shall conflict with any term in the Plan as constituted on the
Date of Grant, the term in the Plan constituted on the Date of Grant of such
Option shall control.
7.3 Vesting. Except in the case of the death, Disability, or Retirement of a
Participant, and subject to the provisions of Section 7.4 hereof, the Restricted
Stock Granted under the Plan will vest in accordance with the following
schedule:
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<Table>
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COMPLETED YEARS OF EMPLOYMENT CUMULATIVE
FROM DATE OF GRANT VESTING PERCENTAGE
------------------ ------------------
1 25%
2 50%
3 75%
4 or more 100%
</Table>
Except as provided in this Section 7.3, in the event a Participant
terminates employment prior to 100% vesting, any shares of Restricted Stock
which are not vested shall be forfeited immediately and permanently. A
Participant shall be 100% vested in his Restricted Stock in the event he
terminates employment by reason of death, Disability, or Retirement, or in the
event of a Change in Control as described in Section 7.4.
For purposes of this Section 7.3, account shall be taken of any adjustments
made to the shares of Restricted Stock as described in Section 8.3 hereof after
the Date of Grant of the Restricted Stock, such that the number of shares of
Restricted Stock with respect to which a Participant is vested shall be
redetermined at the time of an adjustment.
7.4 Acceleration of Vesting.
(a) Notwithstanding anything to the contrary in the Plan, including
Sections 7.3, the Compensation Committee, in its discretion, may accelerate,
in whole or in part the vesting schedule applicable to a grant of Restricted
Stock.
(b) In the event of a Change in Control (as defined in the Sotheby's
Holdings, Inc. 1997 Stock Option Plan), Restricted Stock granted under the
Plan shall become 100% vested on the date of the Change in Control.
7.5 Taxes and Withholding. When a Participant incurs tax liability in
connection with the lapse of a restriction which tax liability is subject to tax
withholding under applicable tax laws, and the Participant is obligated to pay
an amount required to be withheld under applicable tax laws, the withholding tax
obligation will be satisfied by withholding from shares to be issued upon lapse
of such restriction that number of shares of Common Stock having a Fair Market
Value equal to the minimum amount required to be withheld (but in no event any
more than the minimum amount required to be withheld). The Corporation will
establish the procedures for selling shares needed to satisfy the tax
withholding liability, which procedures may include selling shares on the open
market or the Corporation's purchase of such shares or such other procedures as
the Corporation deems desirable. The Participant also has the option to make
payment in cash in United States dollars in lieu of the share withholding
described above pursuant to procedures established by the Corporation. The
amount of any such withholding shall be determined by the Corporation.
7.6 Surrender of Restricted Stock. Any Restricted Stock granted under the
Plan may be surrendered to the Corporation for cancellation on such terms as the
Committee and the Participant agree.
7.7 Restrictions on Ownership of Class B Common Stock; Incorporation by
Reference of Articles of Incorporation. Ownership of Class B Common Stock is
subject to all of the restrictions contained in the Articles of Incorporation,
including the automatic conversion of Class B Common Stock to Class A Common
Stock. The relevant provisions of the Articles of Incorporation are hereby
incorporated by reference.
7.8 Issuance of Class A Common Stock. This Section 7.8 applies if at any
time that shares of any class of the Corporation's capital stock are listed on a
national securities exchange, the rules of such exchange or of any governmental
agency of the United States of America require the delisting of such shares if
the Corporation issues shares of Class B Common Stock. In that event, the
Corporation shall deliver the same number of shares of Class A Common Stock as
the number of shares of Class B Common Stock that is the subject of the
Restricted Stock.
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ARTICLE 8
AMENDMENT AND TERMINATION OF THE PLAN; REORGANIZATIONS AND
RECAPITALIZATIONS OF THE CORPORATION
8.1 Amendment of the Plan. The Compensation Committee may from time to time
suspend or discontinue the Plan or revise or amend the Plan in any respect
whatsoever; provided, however, that to the extent necessary and desirable to
comply with Rule 16b-3 under the Exchange Act and with section 162(m) of the
Code (or any other applicable law or regulation, including the requirements of
any stock exchange on which the Common Stock is listed or quoted), shareholder
approval of any plan amendment shall be obtained in such a manner and to such a
degree as is required by the applicable law or regulation. In the event of a
revision or amendment to the Plan, all outstanding Restricted Stock shall be
adjusted to be consistent with the terms and provisions of the Plan, as revised
or amended, and in such manner as the Compensation Committee may deem equitable
or as may be required pursuant to applicable law; provided, however, that except
with the written consent of a Participant or as otherwise specifically provided
herein with respect to a replacement plan, no amendment, suspension, termination
or modification of the Plan shall alter or impair the rights of a Participant
under any Award previously granted under the Plan.
8.2 Termination of the Plan. The Compensation Committee, with the approval
or at the direction of the Board of Directors, and the Board of Directors shall
have the right and power to terminate the Plan at any time, and no Restricted
Stock shall be granted under the Plan after the termination of the Plan. The
termination of the Plan shall not have any other effect, and any outstanding
Restricted Stock shall be subject to the same terms and conditions, as provided
in Article 7 hereof, that would have applied to such Restricted Stock if the
Plan had not been terminated.
8.3 Reorganizations and Recapitalizations of the Corporation.
(a) The existence of this Plan and Restricted Stock granted hereunder
shall not affect in any way the right or power of the Corporation or its
shareholders to make or authorize any or all adjustments, recapitalizations,
reorganizations or other changes in the Corporation's capital structure or
its business, or any merger or consolidation of the Corporation, or any
issue of bonds, debentures, preferred or prior preference stocks ahead of or
affecting the shares or the rights thereof, or the dissolution or
liquidation of the Corporation, or any sale or transfer of all or any part
of its assets or business, or any other corporate act or proceeding, whether
of a similar character or otherwise.
(b) The issue by the Corporation of shares of stock of any class, or
securities convertible into shares of stock of any class, for cash or
property, or for labor or services, either upon direct sale or upon exercise
of rights or warrants to subscribe therefor, or upon conversion of shares or
obligations of the Corporation convertible into such shares or other
securities, shall not affect, and no adjustment by reason thereof shall be
made with respect to, the number of shares subject to Restricted Stock
granted hereunder.
ARTICLE 9
COMPLIANCE WITH OTHER LAWS AND REGULATIONS
9.1 Registration or Qualification of Securities. The Plan and the grant of
Restricted Stock under the Plan shall be subject to all applicable federal and
state laws, rules, and regulations and to such approvals by any government or
regulatory agency as may be required. Each share of Restricted Stock shall be
subject to the requirement that if at any time the Compensation Committee shall
determine, in its discretion, that the listing, registration or qualification of
the shares covered thereby under any securities exchange or under any state or
federal law or the consent or approval of any governmental regulatory body is
necessary or desirable as a condition of, or in connection with, the granting of
such Restricted Stock, the Restricted Stock shall comply with any registration,
qualification, consent or approval requirements as imposed by the Compensation
Committee.
9.2 Representation. The Compensation Committee may require that any Person
who is granted Restricted Stock under the Plan represent and agree in writing
that if the shares of Common Stock
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made subject to the Restricted Stock are issuable under an exemption from
registration requirements, the shares will be 'restricted' securities which may
be resold only in compliance with the applicable securities laws, and that such
Person is acquiring the shares issued for investment purposes and not with a
view toward distribution.
9.3 Exchange of Certificates. If, in the opinion of the Corporation and its
counsel, any legend placed on a stock certificate representing shares of Class B
Common Stock sold under the Plan is no longer required, the holder of such
certificate shall be entitled to exchange such certificate for a certificate
representing the same number of such shares but lacking such legend.
ARTICLE 10
RESTRICTIONS ON TRANSFER
A Participant's rights and interests under the Plan may not be assigned or
transferred other than by will or the laws of descent and distribution, and
during the lifetime of a Participant, only the Participant personally (or the
Participant's personal representative) may exercise his rights under the Plan.
No purported assignment, pledge or transfer of Restricted Stock granted under
the Plan, whether voluntary or involuntary, by operation of law or otherwise,
shall vest in the purported transferee or assignee any interest or right therein
whatsoever but immediately upon any such purported assignment or transfer, or
any attempt to make the same, such Restricted Stock thereunder shall terminate
and become of no further effect.
ARTICLE 11
GENERAL PROVISIONS
11.1 No Right to Continued Employment. No Employee or any other Person shall
have any claim or right to be issued Restricted Stock under the Plan. Neither
the adoption and maintenance of the Plan nor the granting of Restricted Stock
pursuant to the Plan shall be deemed to constitute a contract of employment
between the Corporation and any Employee or to be a condition of the employment
of any Person. The Plan and any Restricted Stock granted under the Plan shall
not confer upon any Participant any right with respect to continued employment
by the Corporation, nor shall they interfere in any way with the right of the
Corporation to terminate the employment of any Participant at any time, and for
any reason, with or without cause, it being acknowledged, unless expressly
provided otherwise in writing, that the employment of a Participant is and
continues to be 'at will.'
11.2 Beneficiaries or Representatives of a Participant. The Compensation
Committee's determination of death or Disability and of the right of any Person
other than a Participant under the Plan shall be conclusive. The Compensation
Committee, in its discretion, may require from any Person, other than an a
Participant such security and indemnity as the Compensation Committee, in its
discretion, deems necessary or advisable.
11.3 Elimination of Fractional Shares. If under any provision of the Plan
that requires a computation of the number of shares of Restricted Stock the
number so computed is not a whole number of shares of Restricted Stock, such
number of shares of Restricted Stock shall be rounded down to the next whole
number.
11.4 Inspection of Records. Copies of the Plan, records reflecting each
Participant's Awards, and any other documents and records that a Participant is
entitled by law to inspect shall be open to inspection by the Participant and
his duly authorized representative(s) at the office of the Corporation at any
reasonable business hour.
11.5 Word Meanings. The words such as 'herein,' 'hereinafter,' 'hereof,' and
'hereunder' refer to this Plan as a whole and not merely to a subdivision in
which such words appear unless the context otherwise requires.
11.6 Section Titles. Section titles are for descriptive purposes only and
shall not control or alter the meaning of the Plan as set forth in the text.
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11.7 Severability. Whenever possible, each provision in the Plan and all
Restricted Stock granted under the Plan shall be interpreted in such a manner as
to be effective and valid under applicable law, but if any provision of the Plan
or any Restricted Stock at any time granted under the Plan shall be held to be
prohibited or invalid under applicable law, then, (i) such provision shall be
deemed amended to accomplish the objectives of the provision as originally
written to the fullest extent permitted by law, and (ii) all other provisions of
the Plan and all other Restricted Stock at any time granted under the Plan shall
remain in full force and effect.
11.8 Compliance with Section 16(b) of the Securities Exchange Act. With
respect to Reporting Persons, transactions under this Plan are intended to
comply with all applicable conditions of Rule 16b-3 or its successors under the
Exchange Act and in all events the Plan shall be construed in accordance with
Rule 16b-3. To the extent any provision of the Plan or action by the
Compensation Committee fails to so comply, it shall be deemed null and void to
the extent permitted by law and deemed advisable by the Compensation Committee.
The Compensation Committee, in its absolute discretion, may bifurcate the Plan
so as to restrict, limit or condition the use of any provision of the Plan to
participants who are officers or directors of the Corporation, subject to
Section 16 of the Exchange Act without so restricting, limiting or conditioning
the Plan with respect to other participants.
11.9 Compliance with Code Section 162(m). This Plan is intended to comply
with all applicable provisions of section 162(m) of the Code. To the extent any
provision of the Plan or action by the Compensation Committee fails to so
comply, it shall be deemed null and void to the extent permitted by law and
deemed advisable by the Compensation Committee.
11.10 Strict Construction. No rule of strict construction shall be implied
against the Compensation Committee, the Corporation or any other Person in the
interpretation of any of the terms of the Plan, any Restricted Stock granted
under the Plan or any rule or procedure established by the Compensation
Committee.
11.11 Choice of Law. All determinations made and actions taken pursuant to
the Plan shall be governed by the internal laws of the State of Michigan and
construed in accordance therewith.
To record the adoption of the Plan, the Corporation has caused the execution
hereof as of this 29th day of April, 2003.
SOTHEBY'S HOLDINGS, INC.,
a Michigan corporation
By: /s/ WILLIAM F. RUPRECHT
----------------------------
William F. Ruprecht
President and Chief Executive Officer
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