Peet's Coffee & Tea, Inc. Announces Exclusive License Agreement with K.K. Heichinrou Co., Ltd. To Develop Peet's Brand In Japan.

EMERYVILLE, CA. - October 23, 2001 - Peet's Coffee & Tea, Inc. (NASDAQ: PEET), a specialty coffee roaster and marketer, today announced that a license agreement has been reached with K. K. Heichinrou Co., Ltd. of Yokahama, Japan. The agreement designates Heichinrou as the exclusive licensee of the Peet's Coffee & Tea brand in Japan.

Under the agreement, Heichinrou will develop the Peet's brand in Japan by operating Peet's retail stores and distributing whole bean coffee and hand-selected tea products into select department stores, high-end supermarkets and gourmet food stores. The first retail store is expected to open in mid 2002 in Tokyo with distribution to other channels to follow shortly thereafter.

"With K.K. Heichinrou and its outstanding management team lead by Mr. Yasuhiro Hayashi, Peet's found a quality partner that operates with the same attention to detail that has made Peet's successful in the U.S.," said Christopher P. Mottern, president and chief executive officer, Peet's Coffee & Tea, Inc. "We look forward to working with the Heichinrou team, who are highly skilled in gourmet food preparation, restaurant service, retail operations and gourmet food distribution."

"Everyone at K.K. Heichinrou is excited about the prospect for bringing Peet's Coffee & Tea to Japan," said Mr. Yasuhiro Hayashi, President of K.K. Heichinrou Co. Ltd. "Our company respects the quality and image that has been so carefully nurtured by Peet's over its 35-year history. We will work very hard to bring the Japanese consumer the exact product quality and presentation that Peet's U.S. consumers have come to expect."

The agreement with Heichinrou is Peet's first licensing partnership outside the U.S. and other countries are under consideration for development as U.S. specialty coffee products continue to grow in popularity throughout the world.

"We are excited about our partnership with Heichinrou and the great potential of the Peet's brand in Japan," said Mottern. "Japan's specialty coffee culture is growing rapidly. We expect that Peet's quality, brand image and authenticity will be very attractive to the ever growing number of Japanese consumers who appreciate the best coffee and tea products."

The company is highly selective in developing its licensing partners. These partners must adhere to the company's strict freshness and brewing standards and commit to a multi-channel distribution model.