Exhibit 4.4
Form of Noteholders Warrant
issued in Delphi Financing
ELEPHANT & CASTLE GROUP, INC.
NOTEHOLDERS WARRANT
February 1, 1999
Elephant & Castle Group, Inc., a corporation organized under the
Providence of British Columbia (the "Company"), hereby agrees that, for value
received, ______________________, or its assigns, is entitled, subject to the
terms set forth below, to purchase from the Company, at any time after the date
hereof and prior to the expiration of one (1) year from the date hereof,
______________ (____) shares of the $.01 par value Common stock of the Company
(the "Common Stock"), at an exercise price of $3.00 which exercise price is
subject to adjustment as provided herein. Terms not otherwise defined herein
shall have the meaning ascribed in that certain Agency Agreement by and between
Delphi Financial Corporation and the Company dated as of February 1, 1999.
1. Exercise of Warrant. The purchase rights granted by this Warrant
shall be exercised by surrendering this Warrant with the form of exercise
attached hereto duly executed by such holder, to the Company at its principal
office, accompanied by payment, in cash or by cashier's check payable to the
order of the Company or by cashless exercise pursuant to Section 2 hereof, of
the purchase price payable in respect of the Common Stock being purchased. If
less than all of the Common Stock purchasable hereunder is purchased, the
Company will, upon such exercise, execute and deliver to the holder hereof a new
Warrant (dated the date hereof) evidencing the number of shares of Common Stock
not so purchased. As soon as practical after the exercise of this Warrant and
payment of the purchase price, the Company will cause to be issued in the name
of and delivered to the holder hereof, or as such holder may direct, a
certificate or certificates representing the shares purchased upon such
exercise.
2. Antidilution Adjustments. If the Company shall at any time hereafter
subdivide or combine its outstanding shares of Common Stock, or declare a
dividend payable in Common Stock, the exercise price in effect immediately prior
to the subdivision, combination or record date for such dividend payable in
Common Stock shall forthwith be proportionately increased, in the case of
combination, or proportionately decreased, in the case of subdivision or
declaration of a dividend payable in Common Stock, and each share of Common
Stock purchasable upon exercise of this Warrant, immediately preceding such
event, shall be changed to the number determined by dividing the then current
exercise price by the exercise price as adjusted after such subdivision,
combination or dividend payable in Common Stock.
No fractional shares of Common Stock are to be issued upon the exercise
of the Warrant, but the Company shall pay a cash adjustment in respect of any
fraction of a share which would otherwise be issuable in an amount equal to the
same fraction of the market price per share of Common Stock on the day of
exercise as determined in good faith by the Company.
In case of any capital reorganization or any reclassification of the
shares of Common Stock of the Company, or in the case of any consolidation with
or merger of the Company into or with another corporation, or the sale of all or
substantially all of its assets to another corporation, which is effected in
such a manner that the holders of Common Stock shall be entitled to receive
stock, securities or assets with respect to or in exchange for Common Stock,
then, as a part of such reorganization, reclassification, consolidation, merger
or sale, as the case may be, lawful provision shall be made so that the holder
of the Warrant shall have the right thereafter to receive, upon the exercise
hereof, the kind and amount of shares of stock or other securities or property
which the holder would have been entitled to receive if, immediately prior to
such reorganization, reclassification, consolidation, merger or sale, the holder
had held the number of shares of Common Stock which were then purchasable upon
the exercise of the Warrant. In any such case, appropriate adjustment (as
determined in good faith by the Board of Directors of the Company) shall be made
in the application of the provisions set forth herein with respect to the rights
and interest thereafter of the holder of the Warrant, to the end that the
provisions set forth herein (including provisions with respect to adjustments of
the exercise price) shall thereafter be applicable, as nearly as reasonably may
be, in relation to any shares of stock or other property thereafter deliverable
upon the exercise of the Warrant.
When any adjustment is required to be made in the exercise price,
initial or adjusted, the Company shall forthwith determine the new exercise
price, and
1. prepare and retain on file a statement describing in
reasonable detail the method used in arriving at the new exercise price; and
2. cause a copy of such statement to be mailed to the holder of
the Warrant as of a date within ten (10) days after the date when the
circumstances giving rise to the adjustment occurred.
3. Transferability. Prior to making any transfer of the Warrant or of
any Common Stock purchased upon exercise of the Warrant, the holder will give
written notice to the Company describing briefly the manner of any such proposed
transfer. The holder will not make any such transfer until (i) the Company has
notified it that, in the opinion of its counsel, registration under the Act is
not required with respect to such transfer, or (ii) a registration statement
covering the proposed distribution has been filed by the Company and has become
effective. The holder will then make any disposition only pursuant to the
conditions of such opinion or registration. The Company agrees that, upon
receipt of written notice from the holder hereof with respect to such proposed
distribution, it will use its best efforts, in consultation with the holder's
counsel, to ascertain as promptly as possible whether or not registration is
required, and will advise the holder promptly with respect thereto, and the
holder will cooperate in providing the Company with information necessary to
make such determination.
4. Registration Rights.
1. Registration. The Company shall register the shares of Common Stock
issuable upon exercise of the Warrants in the registration statement on Form S-3
(or its equivalent) when the Company registers the shares of Common Stock
issuable upon conversion of the securities sold in the First Private Placement.
2. "Piggyback" Registration Rights. If, at any time after the date
hereof and prior to the expiration of one (1) year from the date hereof, the
Company shall propose to file any registration statement under the Securities
Act of 1933, as amended, covering a public offering of the Company's Common
Stock and permitting the inclusion of shares of selling shareholders, it will
notify the holder hereof at least thirty (30) days prior to each such filing and
will include in the registration statement (to the extent permitted by
applicable regulation) the Common Stock purchased by the holder or purchasable
by the holder upon the exercise of the Warrant to the extent requested by the
holder hereof. Notwithstanding the foregoing, the number of shares of the
holders of the Warrants proposed to be registered shall thereby be reduced pro
rata with any other selling shareholder (other than the Company) upon the
request of the managing underwriter of such offering subject to the prior rights
of any other selling shareholders that give it first priority in any such
registration. If the registration statement or offering statement filed pursuant
to such forty-five (45) day notice has not become effective within six months
following the date such notice is given to the holder hereof, the Company must
again notify such holder in the manner provided above.
3. Other.
(1) All expenses of any such registrations referred to in this
Section 4, except the fees of counsel to such holders and underwriting
commissions or discounts, shall be borne by the Company.
(2) The Company will mail to the holder hereof, at the last
known post office address, written notice of any exercise of the rights granted
under this Section 4, by certified or registered mail, return receipt requested,
and each holder shall have thirty (30) days from the date of deposit of such
notice in the U.S. Mail to notify the Company in writing whether such holder
wishes to join in such exercise.
(3) The Company will furnish the holder hereof with a
reasonable number of copies of any prospectus included in such filings and will
amend or supplement the same as required during the period of required use
thereof. The Company will maintain the effectiveness of any shelf registration
statement or the offering statement filed by the Company, whether or not at the
request of the holder hereof, for at least six (6) months following the
effective date thereof.
(4) In the case of the filing of any registration statement,
and to the extent permissible under the Act and controlling precedent
thereunder, the Company and the holder hereof shall provide cross
indemnification agreements to each other in customary scope covering the
accuracy and completeness of the information furnished by each.
(5) The holder of the Warrant agrees to cooperate with the
Company in the preparation and filing of any such registration statement or
offering statement, and in the furnishing of information concerning the holder
for inclusion therein, or in any efforts by the Company to establish that the
proposed sale is exempt under the Act as to any proposed distribution.
(6) The Company shall have no obligation under this Section 4 to
register any of the shares of the holders if in accordance with Rule 144,
promulgated under the Securities Act of 1933, as amended, the holder may sell
all his shares of common stock obtained upon an exercise of this Warrant within
ninety (90) days immediately following the request for registration.
(7) The holder of the Warrant shall have the same rights on a "most
favored nation" status as those afforded to GE Investment Private Placement
Partners II in the Company's Warrant to Purchase Common Stock dated January 1,
1999.
5. Notices. The Company shall mail to the registered holder of the
Warrant, at its last known post office address appearing on the books of the
Company, not less than fifteen (15) days prior to the date on which (a) a record
will be taken for the purpose of determining the holders of Common Stock
entitled to dividends (other than cash dividends) or subscription rights, or (b)
a record will be taken (or in lieu thereof the transfer books will be closed)
for the purpose of determining the holders of Common Stock entitled to notice of
and to vote at a meeting of stockholders at which any capital reorganization,
reclassification of shares of Common Stock, consolidation, merger, dissolution,
liquidation, winding up or sale of substantially all of the Company's assets,
shall be considered and acted upon.
6. Reservation of Common Stock. A number of shares of Common Stock
sufficient to provide for the exercise of the Warrant upon the basis herein set
forth shall at all times be reserved for the exercise thereof.
7. Miscellaneous. Whenever reference is made herein to the issue or
sale of shares of Common Stock, the term "Common Stock" shall include any stock
of any class of the Company other than preferred stock with a fixed limit on
dividends and a fixed amount payable in the event of any voluntary or
involuntary liquidation. dissolution or winding up of the Company.
Upon written request of the holder of this Warrant, the Company will
promptly provide such holder with a then current written list of the names and
addresses of all holders of warrants originally issued under the terms of, and
concurrent with, this Warrant.
The representations, warranties and agreements herein contained shall
survive the exercise of this Warrant. References to the "holder of" include the
immediate holder of shares purchased on the exercise of this Warrant, and the
word "holder" shall include the plural thereof. This Warrant shall be
interpreted under the laws of the State of Minnesota.
All shares of Common Stock or other securities issued upon the exercise
of this Warrant shall be validly issued, fully paid and non-assessable, and the
Company will pay all taxes in respect of the issuer thereof.
Notwithstanding anything contained herein to the contrary, the Holder
of this Warrant shall not be deemed a stockholder (including, no right to vote
on any matters coming, before the shareholders) of the Company for any purpose
whatsoever until and unless this Warrant is duly exercised.
IN WITNESS WHEREOF, this Warrant has been duly executed by Elephant &
Castle Group, Inc., this 1st day of February, 1999.
Elephant & Castle Group, Inc.
By:
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Title:
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WARRANT EXERCISE FORM
To be signed only upon exercise of Warrant
The undersigned, the holder of the within Warrant, hereby irrevocably
elects to exercise the purchase right represented by such Warrant for, and to
purchase thereunder, ____________ of the shares of Common Stock of Elephant &
Castle Group, Inc. to which such Warrant relates and herewith makes payment of
$______ therefor in cash or by certified check, and requests that such shares be
issued and be delivered to, the address for which is set forth below the
signature of the undersigned.
Dated:
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(Taxpayer's 1.D. Number) (Signature)
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(Address)
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ASSIGNMENT FORM
To be signed only upon authorized transfer of Warrant
FOR VALUE RECEIVED, the undersigned hereby sells, assigns, and
transfers unto _____________________________ the right to purchase shares of
Common Stock of Elephant & Castle Group, Inc. to which the within Warrant
relates and appoints _______________________ attorney, to transfer said right on
the books of Elephant & Castle Group, Inc. with full power of substitution in
the premises.
Date:
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(Signature)
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(Address)
