Elephant & Castle Announces Agreement for First Alamo Grill Franchise With the Bass Hotels and Resorts.

MINNEAPOLIS--(BUSINESS WIRE)--Feb. 18, 1999--Elephant & Castle Group Inc. (NASDAQ:PUBSF, PACIFIC:PUB) announced today it has completed a restaurant franchise agreement between Elephant & Castle International and Holiday Inn Hotels, a division of Bass Hotels and Resorts. The agreement is for the Company's Alamo Grill(TM) concept and will be developed in the Holiday Inn hotel prototype located in Atlanta. The hotel and attached restaurant are expected to open late in 1999.

Ned Barker, Vice President of Food and Beverage Services for Holiday Inn Hotels commented; "We decided to franchise the Alamo Grill because of Elephant & Castle's willingness and ability to adapt their steakhouse concept to a hotel environment, and the food is great!"

Martin O'Dowd, President and Chief Executive Officer stated; "We are very pleased to bring our relationship with the Holiday Inn Hotels to this new level. This agreement gives us new strategic avenues for expansion and the ability to bring another one of our concepts into the hotel industry. We are confident that this will be a complete food and beverage solution for hotels."

This Alamo Grill restaurant will offer breakfast, lunch and dinner to the guests and will also feature the Holiday Inn's awarding winning Best-4-Breakfast(R) menu in the mornings. In addition to serving the three dayparts, the Alamo Grill will operate all room service and banquet needs. The new hotel is currently under construction and will be targeting the weekday business traveler and vacationers.

The Alamo Grill is themed as a casual Southwestern-style steakhouse featuring the favorite foods of America's Old Southwest. The menu features signature "Texas-sized" charbroiled, sizzling steaks, smoked meats and ribs as well as other traditional Southwestern specialties such as the Sizzlin' Fajitas. The cantina serves appetizers such as the Nachos Rio Grande and the Alamo's Famous 20 oz. Margarita with its full bar service. The Southwestern decor is inspired by the Spanish mission style of historic San Antonio, Texas and truly conveys the spirit of the Old Southwest.

Elephant & Castle(R) Group Inc. is the largest operator of authentic British-style pubs in North America. In addition the company owns and operates a Southwestern-theme restaurant concept called Alamo Grill(TM). These two concepts are franchised throughout the United States and Canada. Elephant & Castle also has a joint venture agreement with Rainforest Cafe Inc. to develop, own and operate the Rainforest Cafe restaurant and retail facilities in Canada.

This news release (as well as information included in oral statements or other written statements made or to be made by the Company) may contain forward-looking statements, such as statements relating to future expansion, that involve risks and uncertainties relating to future events. Actual events or the Company's results may differ materially from the results discussed in the forward-looking statement. The Company does not expect to update forward-looking statements continually as conditions change. These risks and uncertainties include, but are not limited to, those relating to competition, fluctuations and changes in consumer preferences and attitudes, intellectual property protection, development and construction activities. Investors are referred to the full discussion of risks and uncertainties associated with forward-looking statements contained in the company's Form 10-K filed with the Securities and Exchange Commission for the fiscal year ended Dec. 31, 1997.