MATTHEWS STUDIO EQUIPMENT GROUP
EXHIBIT (11.3) AMENDMENT NO. 1 TO COMMON STOCK PURCHASE WARRANT
AMENDMENT NO. 1 TO
COMMON STOCK PURCHASE WARRANT
AMENDMENT NO. 1 TO COMMON STOCK PURCHASE WARRANT, dated as of April 5, 1996
(this "Amendment") to that certain Common Stock Purchase Warrant dated as of
---------
July 27, 1995 (the "Warrant"), issued by MATTHEWS STUDIO EQUIPMENT GROUP (the
-------
"Company"), to ING EQUITY PARTNERS, L.P.I ("ING"), is made by and between the
------- ---
Company and ING. Capitalized terms used herein, except as otherwise defined
herein, shall have the meanings given to such terms in the Warrant.
WHEREAS, the Common Stock of the Company is listed on the National
Association of Securities Dealer, Inc. ("NASD") inter-dealer quotation system
and is designated as a National Market System security; and
WHEREAS, the NASD has required that the Company amend the terms of the
Warrant, to modify the antidilution rights of the Holder; and
WHEREAS, ING is the sole Holder of the Warrant, and the Company has
requested that ING agree to the amendment of the Warrant and related documents
in order for the Company to accommodate the actions required by the NASD, and
both the Company and ING mutually desire to maintain the listing of the
Company's Common Stock with the NASD and the designation of the same as a
National Market System security and are willing to enter into this Amendment to
provide such accommodation;
NOW, THEREFORE, in consideration of the mutual promises, covenants and
agreements hereinafter set forth, and other good and valuable consideration, the
value and sufficiency of which is hereby acknowledged the parties hereto agree
as follows:
1. Amendments to Warrant. The Warrant is hereby amended as of date
---------------------
hereof by the insertion of a new Section 3.3.10 at the end of Article III of the
Warrant which new section states in its entirety as follows:
SECTION 3.3.10 Adjustment Limitations. Adjustments to the Exercise
----------------------
Price and the number of Warrant Shares for which the Warrant may be
exercised shall be subject to the following limitations:
(a) The minimum Exercise Price after adjustment pursuant to
this Section 3.3 shall be $1.75. With respect to any adjustment, or
related series of adjustments, in Exercise Price pursuant to this
Section 3.3 that provides for an adjusted Exercise Price of less than
$1.75, such adjustment, or related series of adjustments, shall be
made only to the extent of reducing the Exercise Price to $1.75.
Without the prior written consent of the Holders of a majority of the
Warrant Shares, the Company shall not issue or sell any shares of
Common Stock, Options or Convertible Securities, if, without regard to
this Section 3.3.10(a), such issuance or sale would cause the Exercise
Price, as adjusted pursuant to this Section 3.3, to be below $1.75.
(b) Any adjustment, or related series of adjustments, pursuant
to this Section 3.3, to the number of Warrant Shares for which the
Warrants may be exercised, shall not increase (a "Prohibited
Increase") the beneficial ownership (as that term is defined in Rule
13d-3 of the Exchange Act) of the Holders, as of July 27, 1995 (the
"Calculation Date"), of shares of Common Stock to be greater than or
equal to thirty percent (30%); provided that (i) shares of Common
Stock which the Holders beneficially owned as of the Calculation Date,
but which the Holders cease to beneficially own after the Calculation
Date, and (ii) shares of Common Stock of which the Holders become the
beneficial owners (other than through the exercise of the Warrants)
after the Calculation Date, shall not be included in any calculation,
pursuant to this Section 3.3.10(b), of the Holder's beneficial
ownership of Common Stock. With respect to any adjustment, or related
series of adjustments, pursuant to this Section 3.3, to the number of
Warrant Shares that would cause a Prohibited Increase, such adjustment
shall be made only to the extent that the beneficial ownership of the
Holders of Common Stock, calculated in accordance with the first
sentence of this Section 3.3.10(b), is less than thirty percent (30%).
Without the prior written consent of the Holders of a majority of the
Warrant Shares, the Company shall not issue or sell any shares of
Common Stock, Options or Convertible Securities, if, without regard to
this Section 3.3.10(b), such issuance or sale would cause a Prohibited
Increase.
2. Termination of this Amendment. If at any time during the term of the
-----------------------------
Warrant, the NASD acknowledges and agrees in
-2-
writing that the NASD does not require that the terms of the Warrant be amended
as set forth in this Amendment, this Amendment shall terminate. Such termination
shall be effective, without further action by the Holders or the Company, upon
receipt by the Holders and the Company of such written acknowledgement and
agreement from the NASD.
3. No implied Amendments. Except as herein amended, the Warrant shall
---------------------
remain in full force and effect and is ratified in all respects. On and after
the effectiveness of this Amendment, each reference in the Warrant to "this
Warrant", "hereunder", "hereof", "herein" or words of like import, and each
reference to the Warrant in any other agreements, documents or instruments
executed and delivered pursuant to the Purchase Agreement, shall mean and be a
reference to the Warrant, as amended by this Amendment.
4. Effective Date. This Amendment shall become effective upon
--------------
compliance with each of the conditions set forth in Section 4 of Amendment No. 1
to Purchase Agreement of even date herewith between the Company and ING.
5. Counterparts. This Amendment may be executed by the parties hereto in
------------
several counterparts, each of which shall be executed by the Company and ING and
be deemed to be an original and all of which shall constitute together but one
and the same agreement.
-3-
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their respective officers thereunto duly authorized as of the day
and year first above written.
MATTHEWS STUDIO EQUIPMENT GROUP
By s/ Carlos D. De Mattos
---------------------------------------------------
Title: Chairman and Chief Executive Officer
Address: 2405 Empire Avenue
Burbank, California 94504
Attention: Mr. Carlos De Mattos
ING EQUITY PARTNERS, L.P.I
By: Lexington Partners, L.P., its general partner
By: Lexington Partners, Inc., its general partner
By: /s/ Benjamin P. Giess
-------------------------------------------------
Title: Vice President
Notices: ING Equity Partners, L.P.I
135 East 57th Street
New York, New York 10022
Attention: Benjamin P. Giess
-4-