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TULLY'S COFFEE LICENSE AGREEMENT

[*—Material has been omitted pursuant to a request for confidential treatment in
accordance with Rule 24b-2 under the Securities Exchange Act of 1934, as
amended. The redacted material has been filed separately with the Securities and
Exchange Commission.]

        THIS AGREEMENT, effective as of the 26th day of April, 2001, is entered
into between TULLY'S COFFEE CORPORATION, a Washington corporation, doing
business at 3100 Airport Way South, Seattle, Washington 98134 U.S.A.
("Licensor"), and TULLY'S COFFEE JAPAN a company organized under the laws of
Japan, doing business at 3-4-1 Takanawa, Minato-ku, Tokyo Japan ("Licensee").

RECITALS

        A.    Licensor is in the business of developing and operating specialty
stores featuring coffee drinks and other beverages and a light food menu for on
and off premises consumption and which offer retail sales of whole beans and
ground coffee, tea, herbal teas, and related goods (referred to herein as a
"Tully's Store" or as "Tully's Stores").

        B.    Tully's Stores are operated with uniform design, formats, signs,
equipment, layout, systems, and procedures utilizing the know-how, confidential
business information and proprietary tradedress and designs of Licensor.

        C.    Licensor owns rights in, and uses, promotes and licenses, certain
business names and trademarks for services relating to such stores and
trademarks for goods sold through such stores including without limitation the
business names shown in Schedule A (the "Business Names"), the trademarks for
services and trademarks for goods shown in Schedule B (the "Trademarks").

        D.    By virtue of that certain Exclusive Licensing Agreement entered
into as of August 1, 1997, between Licensor and Loco Trading Co., Ltd., Licensee
currently engages in the operation of Tully's Stores in Japan, by itself and
through franchisees. By entering into this Agreement, Licensor and Licensee
desire to set forth revised terms and conditions under which Licensee is
entitled to an exclusive license to use Licensor's know how, trade secrets,
proprietary information and designs, Business Names, and Trademarks in
association with the operation of Tully's Stores in Japan (referred to herein as
the "Territory").

        E.    Simultaneous with the execution of this Agreement, the parties
have agreed to enter into a Supply Agreement with respect to the purchase and
sale of certain products to be used in connection with the operation of Tully's
Stores in the Territory (the "Supply Agreement").

        NOW, THEREFORE, in consideration of the covenants and obligations of
this agreement and for other good and valuable consideration, the parties hereto
have agreed with each other as follows:

        1.        Grant of License.    During the term of this Agreement,
Licensor hereby grants to Licensee the exclusive license to operate Tully's
Store's in the Territory and to use such Tully's Store designs, formats, signs,
equipment, layout, systems, procedures, copyrights, know how, the Business
Names, and the Trademarks in the Territory (collectively, the "Rights") only in
connection with the operation of retail Tully's Stores in the Territory on the
terms and conditions stated herein. The Rights include the rights to utilize in
the Territory the present and future names and marks used by Licensor in its
operations of Tully's Stores whether registered or unregistered.

        2.        No Sublicensing; Franchises.    Except as set forth below with
respect to franchisees, Licensee may not sublicense the rights conferred upon
Licensee by this Agreement. Notwithstanding the above and subject to the
conditions stated below, Licensee may enter into franchise agreements with
franchisees pursuant to which Licensee may grant the right to use the Rights in
the Territory to a franchisee. Except as to the existing franchise arrangements
with the parties listed on Schedule C

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hereto, no such franchise arrangement shall be entered into with a franchisee
unless and until Licensor approves of such franchisee, which approval shall not
be unreasonably be withheld or delayed. The parties acknowledge one condition to
any such approval by Licensor shall be that such franchise arrangement shall be
governed by a written franchise agreement acceptable to Licensor. Such written
franchise agreement shall, if requested by Licensor, include Licensor as a party
thereto solely for the purposes of maintaining a direct right to enforce
Licensor's Standard Specifications and other specifications and requirements
with respect to the use of the Rights by such franchisee. Unless otherwise
agreed to in writing by Licensor, all such franchise arrangements (including all
existing franchisees listed on the attached Schedule C) shall provide that each
franchisee shall pay a royalty fee of [    *    ] on all net revenues (as
defined below) with [    *    ] of such royalty payable to Licensor (the
"Licensor Franchise Royalty Fee"). As used in this Agreement, the term "net
revenues" shall mean and include the actual gross charges for all products and
services of any kind or nature sold in connection with the Tully's Business
Names or Trademarks, for cash or credit through any business conducted by any
franchisee, but excluding sales, use, service, or excise taxes collected from
customers and paid to the appropriate taxing authority. The Licensor Franchise
Royalty Fee shall be payable on or before the end of the month following the
month in which the net revenues were generated.

        3.        No Wholesale Rights.    Nothing in this Agreement shall be
deemed to grant or license to Licensee any rights whatsoever with respect to the
use of the Rights in connection with wholesale or other distribution of products
in the Territory or any other location (other than retail sales made in
connection with the operation of Tully's Stores in the Territory).

        4.        Operation and Development of Stores.    Licensor will furnish
to Licensee standard basic plans and specifications for Tully's Store's (the
"Standard Specifications") for use in the Territory, including specifications
for general interior design, color schemes, finish materials, furniture,
equipment and signs. Licensee agrees that all Tully's Stores in the Territory
(including any franchised Tully's Stores) shall materially comply with
Licensor's Standard Specifications as adopted by Licensor from time to time.
Notwithstanding the foregoing, Licensee Tully's Stores may be modified to the
extent necessary to comply with applicable ordinances, building codes, permit
requirements, and lease or deed requirements and restrictions.

        5.        Equipment, Fixtures and Signs.    Licensee agrees to use in
the operation of each Tully's Store in the Territory only such equipment,
fixtures, furniture and signs that are consistent with Licensor's Standard
Specifications. Licensee further agrees to place or display at the premises of
each such Store (interior and exterior) only such signs, emblems, logos,
lettering, and display materials that are consistent with Licensor's Standard
Specifications

        6.        Training and Operating Assistance.

        a.        Initial Training.    Upon request of Licensee, which request
may be made from time to time, Licensor shall train one or more Licensee
managers in the operation of a Tully's Store. Training shall be conducted at
Licensor's training headquarters at a time which is mutually acceptable to the
parties. Licensee shall bear the cost of any travel and living expenses incurred
in connection with such training.

        b.        Hiring and Training of Employees by Licensee.    Licensee
shall hire all employees of each Tully's Store owned by Licensee in the
Territory, and shall be exclusively responsible for the terms of their
employment and compensation and for the proper training of such employees in the
operation of a Tully's Store.

        c.        Consulting Assistance.    Licensor shall be available at
mutually convenient times to consult with Licensee from time to time with
respect to general operating issues related to any Tully's Store in the
Territory, including without limitation any problems or deficiencies disclosed
by reports submitted to or inspections made by Licensor related to Tully's
Stores in the Territory.

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        d.        Semi-Annual Meetings.    Licensor and Licensee agree that the
parties shall meet at least semi-annually to review the status of the operations
of the Licensee Tully's Stores and Licensor's operation and licensing of Tully's
Stores in the United States and elsewhere. The first such meeting shall take
place at a location to be designated by Licensee. Thereafter, Licensor and
Licensee shall take turns designating the location of such annual meetings.

        7.            Store Image and Operating Standards.

        a.        Condition and Appearance of Stores.    Licensee agrees to
maintain the condition and appearance of each Licensee Tully's Store consistent
in all material respects with the image of a Licensor owned and operated Tully's
Stores with each Licensee Tully's Store as an attractive, modern, sanitary,
convenient, and efficiently operated store selling premium, high quality
products and service. Licensee agrees to effect such maintenance of each
Licensee Tully's Store as is reasonably required from time to time to maintain
such condition, appearance, and efficient operation, including, without
limitation, replacement of worn out or obsolete equipment, fixtures, furniture,
and signs; repair of the interior and exterior of such Stores. If at any time in
Licensor's commercially reasonable judgment, the general state of repair,
appearance, or cleanliness of the premises of a Licensee Tully's Store or its
equipment, fixtures, furniture, signs, or decor does not meet Licensor's
standards therefore, Licensor shall so notify Licensee, specifying the action to
be taken by Licensee to correct such deficiency.

        b.        Authorized Products and Services.    The presentation of a
uniform image to the public and the furnishing of uniform products and services
are an essential element of the Tully's Store system and brand concept. Licensee
therefore agrees that each Licensee Tully's Store will offer only beverages,
food, and other products and services that are consistent in all material
respects with the Tully's Store concept as announced from time to time by
Licensor.

        c.        Food and Beverage Products, Supplies, and Materials.    The
reputation and goodwill of the Tully's Store system is based upon, and can be
maintained and enhanced only by, the sale of consistent, quality products and
the rendering of fast, efficient, consistent and quality service. Licensee
therefore agrees that, unless otherwise agreed by the parties in writing, all
beverages and food products, cooking materials, containers, packaging materials,
other paper and plastic products, glassware, utensils, uniforms, menus, forms,
cleaning and sanitation materials, and other supplies and materials used in the
operation of Licensee Tully's Stores shall conform to Licensor's specifications
and quality standards as established by Licensor from time to time.

        d.        Use of Materials Imprinted With Trademarks.    Licensee shall
in the operation of each Tully's Store in the Territory use containers, napkins,
uniforms, packaging, and other forms and materials imprinted with the Trademarks
as prescribed and used from time to time by Licensor with respect to its
operation of Tully's Stores in the U.S.

        8.        Specifications, Standards, and Procedures.    Licensee agrees
to comply with Licensor's specifications, standards and general procedures for
the operation of Tully's Stores including without limitation the following:

        a.        Recipes, quality of ingredients, portions, and methods and
procedures relating to the storage, handling, preparation, and serving of
beverages and food;

        b.        Safety, maintenance, cleanliness, sanitation, function, and
appearance of each Tully's Store premises and its equipment, fixtures,
furniture, and signs;

        c.        Uniforms to be worn by and general appearance of Store
employees;

        d.        Use of Business Names and Trademarks;

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        All such specifications, standards, and operating procedures shall be
reasonable and consistent with the obligations of Licensee under the lease or
deed for the premises of each Licensee Tully's Store and applicable laws and
ordinances.

        9.        Compliance with Laws and Good Business Practices.    Licensee
shall secure and maintain in force all required licenses, permits, and
certificates relating to the operation of each Licensee Tully's Store and shall
operate each such Store in full compliance with all applicable laws, ordinances,
and regulations. Licensee agrees to refrain from any business or advertising
practice which may be injurious to the business of Licensor and the goodwill
associated with the Business Names and Trademarks and Tully's Stores. Licensor
agrees to refrain from any business or advertising practice, which may be
injurious to the business of Licensee or Licensee's use of the Rights in
compliance with this Agreement.

        10.      Management of Stores—Conflicting and Competing
Interests.    All non-franchised stores in the Territory shall at all times be
under the direct, on-premises supervision of Licensee or a trained and competent
employee thereof. Licensee agrees to use its best efforts to promote and enhance
the business of the Tully's Stores in the Territory, and that it will not engage
in any business or other activity that will conflict with its obligations
hereunder. Licensee further agrees that during the term of the License, it will
not have any interest as an owner, director, officer, employee, consultant,
representative, or agent, or in any other capacity, in any other business having
as a principal product coffee beverages.

        11.      Deviation From Licensor's Standards.    Licensor acknowledges
that in order to better cater to customers in Japan, it may sometimes be
advisable for Licensee to deviate from the Standard Specifications or other of
Licensor's specifications, standards or instructions with which Licensee is
required to comply under this Agreement. Notwithstanding anything to the
contrary in this Agreement, such deviation shall not constitute a breach of this
Agreement if such deviation is not material and does not adversely affect the
image of Licensor, Tully's Stores, Business Names or Trademarks; provided,
however, that after good faith consultation with Licensee, Licensor is entitled
to order Licensee in writing to correct such deviation, whereupon Licensee is
obligated to do so and its failure to do so shall constitute a breach of this
Agreement.

        12.      Indemnification.    Licensee agrees to indemnify, defend and
hold harmless Licensor and all of its shareholders, directors, officers,
employees and representatives from and against all claims, lawsuits, fines,
penalties or damages of any kind (collectively, "Damages") of any kind
whatsoever arising out of or related to Licensee's use of the Business Names or
Trademarks or operation of Tully's Stores in the Territory, except to the
percentage extent that any such Damages are caused by Licensor's own acts or
omissions to act.

        13.      Trade Secrets of Licensor.    Licensee acknowledges that its
knowledge of the operation of a Tully's Store will be derived from information
disclosed to Licensee by Licensor pursuant to the License and that certain of
such information, including without limitation all recipes and Licensor's
Standard Specifications is proprietary, confidential, and a trade secret of
Licensor. Licensee agrees that Licensor will maintain the absolute
confidentiality of all such information during and after the term of the
License, and that they will not use any such information in any other business
or in any manner not specifically authorized or approved in writing by Licensor.

        14.      Business Names and Trademarks.

        a.        Ownership of Names and Marks.    Licensee acknowledges and
agrees that Licensor is the owner of all Business Names and Trademarks licensed
to Licensee by this Agreement, that Licensee's right to use the Business Names
and Trademarks is derived solely from this Agreement and is limited to the
operation of Licensee Tully's Stores in the Territory and the right to enter
into franchise arrangements as provided for in Section 2 of this Agreement.
Licensee agrees that

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all usage of the Business Names and Trademarks by Licensee and any goodwill
established thereby shall inure to the exclusive benefit of Licensor. Licensee
further agrees that after the termination or expiration of the License, Licensee
will not directly or indirectly at any time or in any manner identify itself or
any other business operation of Licensee as a Tully's Store, a former Tully's
Store, or as a Licensee of or otherwise associated with Licensor, or use in any
manner or for any purpose any Business Name or Trademark or other indicia of a
Tully's Store.

        b.        Limitations on Licensee's Use of Business Names and
Trademarks.    Licensee agrees to use the Business Names and Trademarks as the
sole service mark and trademark and trade name identification of each Licensee
Tully's Store.

        15.      Reporting Requirements.    During the term of this Agreement,
Licensee shall furnish to Licensor (i) monthly reports setting forth the total
number of Tully's Stores in the Territory, new store openings, net revenues and
comparable store sales for Tully's Store in the Territory ("Quarterly Reports");
(ii) Licensor's annual business and financial plan (supplemented with any
updates or changes thereto) and (iii) Licensee's annual financial statements
within 120 days of the end of Licensee's fiscal year.

        16.      Licensor's Right to Inspect Stores.    To determine whether
Licensee is complying with this Agreement, Licensor shall have the right, at any
time during business hours and without prior notice to Licensee, to inspect any
of the Licensee Tully's Stores.

        17.      Termination of License.

        a.        By Licensee.    Licensee may terminate this Agreement
effective upon delivery of notice of termination to Licensor, if Licensor:

        (1)      Breaches this Agreement, while Licensee is in substantial
compliance with this Agreement, and fails to cure such breach within thirty
(30) days after written notice thereof is delivered to Licensor;

        (2)      Makes an assignment for the benefit of creditors or an
admission of its inability to pay its obligations as they become due; or

        (3)      Files or has filed against it a petition in bankruptcy or any
similar proceeding or files any pleading seeking any reorganization,
liquidation, or dissolution under any law, or admits or fails to contest the
material allegations of any such pleading filed against it, or is adjudicated a
bankrupt or insolvent, or a receiver is appointed for a substantial part of the
assets of Licensor, or the claims of creditors of Licensor are abated or subject
to a moratorium under any law.

        b.        By Licensor.    Licensor may terminate this Agreement
effective upon delivery of notice of termination to Licensee, if Licensee:

        (1)      Makes an assignment for the benefit of creditors or an
admission of its inability to pay its obligations as they become due;

        (2)      Files or has filed against it a petition in bankruptcy or any
similar proceeding or files any pleading seeking any reorganization,
liquidation, or dissolution under any law, or admits or fails to contest the
material allegations of any such pleading filed against it, or is adjudicated a
bankrupt or insolvent, or a receiver is appointed for a substantial part of the
assets of Licensee, or the claims of creditors of Licensee are abated or subject
to a moratorium under any law;

        (3)      Makes an unauthorized assignment of Licensee's rights under
this Agreement;

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        (4)      Fails or refuses to pay any amount owed to Licensor for
products purchased from Licensor, or any amounts otherwise due to Licensor, or
fails or refuses to comply with any mandatory specification, standard, or
operating procedure prescribed by Licensor relating to recipes, quality of
beverage or food products, methods and procedures for preparing and serving food
products, cleanliness, or sanitation, and does not correct such failure or
refusal within seven (7) days after written notice thereof (which shall describe
the corrective action that Licensee must take) is delivered to Licensee;
provided that if such failure cannot reasonably be corrected within seven
(7) days, to initiate within such seven-day period and thereafter continue such
action as will correct such failure within a reasonable time; or

        (5)      Fails to comply with any other provision of this Agreement or
any other mandatory specification, standard, or operating procedure prescribed
by Licensor, and does not correct such failure within thirty (30) days after
written notice of such failure to comply (which shall describe the action that
Licensee must take) is delivered to Licensee, provided that if such failure
cannot reasonably be corrected within thirty (30) days, to initiate within such
thirty-day period and thereafter continue such action as will correct such
failure within a reasonable time.

        (6)      Fails to comply with any provision of and/or breaches any of
Licensee's obligations under the Supply Agreement, and does not correct such
breach, failure or refusal within seven (7) days after written notice thereof
(which shall describe the corrective action that Licensee must take) is
delivered to Licensee; provided that if such failure cannot reasonably be
corrected within seven (7) days, to initiate within such seven-day period and
thereafter continue such action as will correct such failure within a reasonable
time.

        18.      Licensee's Obligation upon Termination or Expiration.

        a.        Payment of Amounts Owed to Licensor.    Licensee agrees to pay
to Licensor within fifteen (15) days after the effective date of termination or
expiration of the License all such amounts owed for products purchased by
Licensee from Licensor, and all other amounts owed to Licensor, which are then
unpaid.

        b.        Return of Information.    Licensee further agrees that upon
termination of the License, it will immediately return to Licensor all copies of
any manuals, recipes, specifications, menus, software, records or documents of
any kind (in any form of media) delivered to Licensee by Licensor during the
term of the License.

        c.        Cancellation of Assumed Names.    Licensee further agrees that
upon termination or expiration of the License, it will take such action as may
be required to cancel all assumed name or equivalent registrations relating to
its use of any Business Name or Trademark.

        d.        Continuing Obligations.    All obligations of Licensor and
Licensee which expressly, or by their nature, survive the expiration or
termination of the License shall continue in full force and effect subsequent to
and notwithstanding the expiration or termination of the License under this
Agreement and until they are satisfied in full or by their nature expire.

        19.      Assignment, Transfer, and Encumbrance.

        a.        By Licensor.    This Agreement may be assigned by Licensor and
shall inure to the benefit of any assignee or other legal successor to the
interest of Licensor herein.

        b.        Licensee May Not Assign Without Approval of
Licensor.    Licensee shall not, without the prior written consent of Licensor
(which consent may be granted or withheld in Licensor's sole discretion),
voluntarily, involuntarily, directly, or indirectly assign, transfer or sell all
or any part of Licensee's rights under this Agreement. Notwithstanding the
above, Licensee may enter into franchise arrangements in accordance with the
conditions set forth in Section 2 above.

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        20.      Enforcement.

        a.        Judicial Enforcement, Injunction, and Specific
Performance.    Notwithstanding Section 19 b., Licensor shall have the right to
elect to seek injunctive or equitable relief as provided for in this Section 19
a. in the state or federal courts situated in Seattle, Washington, USA (and/or
in any appellate court therefrom). The parties each consent to jurisdiction in
such courts, waive objection to such venue, waive trial by jury. The parties
stipulate and agree that any judgment relating to this Agreement which is
entered in a court located within the State of Washington shall be binding
throughout the world and may be sued upon, docketed, entered and/or enforced,
without challenge or opposition on their part and without re-trial of any of the
issues which gave rise to such judgment, in any state, country, province,
commonwealth or territory having jurisdiction over their respective persons or
properties. Licensor shall be entitled, without bond, to the entry of temporary
and permanent injunctions and orders of specific performance enforcing the
provisions of this Agreement relating to Licensee's use of the Business Names
and Trademarks, the obligations of Licensee upon termination or expiration of
this Agreement and assignment of the License and ownership interests in
Licensee, and to prohibit any act or omission by Licensee that constitutes a
violation of any applicable law, ordinance, or regulation, is dishonest or
misleading to customers or prospective customers of any Licensee Tully's Store,
constitutes a danger to employees or customers of the Store or to the public, or
may impair the goodwill associated with the Business Names and Trademarks and
Tully's Stores. If Licensor secures any such injunction or order of specific
performance, Licensee agrees to pay to Licensor an amount equal to the aggregate
of its costs of obtaining such relief, including without limitation reasonable
attorney and expert witness fees, costs of investigation and proof of facts,
court costs, other litigation expenses, and travel and living expenses, and any
damages incurred by Licensor as a result of the breach of any such provision.

        b.    Arbitration.    Except insofar as Licensor elects to enforce this
Agreement by judicial process, injunction, or specific performance as
hereinabove provided, all disputes and claims relating to any provision hereof,
any specification, standard, or operating procedure, or any other obligation of
Licensee prescribed by Licensor, or any obligation of Licensor, or the alleged
breach thereof (including without limitation any claim that this Agreement, any
provision thereof, any specification, standard, or operating procedure, or any
other obligation of Licensee or Licensor, is illegal or otherwise unenforceable
or voidable under any law, ordinance, or ruling) shall be settled by arbitration
at Seattle, Washington, under the U.S. Arbitration Act (9 U.S.C. §§ 1 et seq.),
if applicable, and the Rules of the American Arbitration Association (relating
to the arbitration of disputes arising under License and license agreements, if
any, otherwise the general rules of commercial arbitration), provided that the
arbitrator shall award, or include in his award, the specific performance of
this Agreement unless he determines that performance is impossible. Judgment
upon the award of the arbitrator may be entered in any court having jurisdiction
thereof or over Licensor or Licensee.

        21.      Severability and Substitution of Valid Provisions.    All
provisions of this Agreement are severable, and this Agreement shall be
interpreted and enforced as if all completely invalid or unenforceable
provisions were not contained herein, and partially valid and enforceable
provisions shall be enforced to the extent valid and enforceable. If any
applicable and binding law or rule of any jurisdiction requires a greater prior
notice of the termination of or refusal to renew this Agreement than is required
hereunder, or the taking of some other action not required hereunder, or if
under any applicable and binding law or rule of any jurisdiction, any provision
of this Agreement or any specification, standard, or operating procedure
prescribed by Licensor is invalid or unenforceable, the prior notice and/or
other action required by such law or rule shall be substituted for the notice
requirements hereof, or such invalid or unenforceable provision, specification,
standard, or operating procedure shall be modified to the extent required to be
valid and enforceable. Such modifications to

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this Agreement shall be effective only in such jurisdiction and shall be
enforced as originally made and entered into in all other jurisdictions.

        22.      Licensee May Not Withhold Payments Due Licensor.    Licensee
agrees that on grounds of the alleged non-performance by Licensor of any of its
obligations hereunder, it will not withhold payment of any royalty and service
fees, amounts due to Licensor for products purchased by Licensee, or any other
amounts due Licensor. Except insofar as Licensor elects to enforce this
Agreement by judicial process, injunction, or specific performance as
hereinabove provided, all such claims by Licensee, if not otherwise resolved by
Licensor and Licensee, shall be submitted to arbitration as provided in
Section 19 b.

        23.      Rights Of Parties Are Cumulative.    The right of Licensor and
Licensee hereunder are cumulative, and no exercise or enforcement by Licensor or
Licensee of any right or remedy hereunder shall preclude the exercise or
enforcement by Licensor or Licensee of any other right or remedy hereunder, or
which Licensor or Licensee is entitled by law to enforce.

        24.      Goodwill, Trademark and Business Name Protection, Third Party
Litigation, Cessation of Use.

        a.        Licensee agrees and admits to the high value of the notoriety,
reputation and goodwill associated with the Trademarks and Business Names.
Licensee acknowledges Licensor's right, title and interest in and to the
Trademarks and Business Names in the Territory and elsewhere. Licensee further
acknowledges that the Trademarks and Business Names have acquired
distinctiveness/secondary meaning and have an established identity in the mind
of the trade and the purchasing public.

        b.        Licensee will not at any time do or cause to be done any act
or thing contesting or in any way impairing or intending to impair any part of
the such right, title and interest of Licensor in the Trademarks and Business
Names and the distinctiveness of the Trademarks and Business Names.

        c.        Except as expressly provided for in this Agreement, Licensee
shall not in any manner represent that it has any ownership in the Trademarks or
Business Names, application for the registration thereof or registration
thereof, and Licensee acknowledges that the use of the Trademarks and Business
Names shall not create in Licensee's favor any right, title or interest in or to
the Trademarks, but all uses of the Trademarks and Business Names shall inure to
the benefit of Licensor.

        d.        To the extent that the ownership of any rights in the
Trademarks and Business Names becomes established in Licensee, whether by
operation of law or otherwise, Licensee agrees to execute such assignments and
other documents as Licensor may reasonably request to transfer such rights to
Licensor, provided that no such assignments or other documents in any way affect
or limit Licensee's exclusive license to use the rights conferred under this
Agreement. In addition, this Section 22 d shall not apply to a transfer of
rights in the Business Names and Trademarks pursuant to a foreclosure of the
security interest granted pursuant to Section 21 below.

        e.        Licensor retains the right to protect the Trademarks and
Business Names from infringement and to prosecute infringers. Licensor has the
right to bring suit for infringement of the Trademarks and Business Names
without joining Licensee. Licensor has the right to control all actions against
infringers and to resolve such matters whether by settlement or suit. If
Licensee becomes aware of any infringement of the Trademarks or Business Names,
it shall notify Licensor in writing. Licensee shall cooperate with Licensor by
promptly supplying, at a reasonable cost, assistance and information reasonably
considered necessary by Licensor for settlement or suit.

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        f.          Licensee agrees not to use the Trademarks or Business Names
in association with any goods or services or business except as expressly
provided in this Agreement or other written authorization by Licensor.

        g.        Licensee agrees not to adopt, use, apply to register or
register anywhere any trademark or Business Names, service mark or business name
which is confusingly similar to the Trademarks or which contain the designations
"TULLY" or "TULLY'S", without regard to the nature of the associated goods,
services or business either during the term of Licensee or thereafter.

        25.      Term.    The term of this Agreement shall commence on the date
set forth above and continue for a period of five years (the "Initial Term").
Provided that Licensee is not then in default of any of its obligations under
this Agreement, Licensee shall have the successive right to renew this Agreement
for an additional five year terms (each a "Renewal Term") upon giving Licensor
prior written notice of such intention within 90 days of the expiration of the
Initial Term or any Renewal Term, as applicable.

        26.      Notices.    All notices and requests in connection with this
Agreement shall be in writing and may be given by registered or certified mail,
personal delivery or facsimile addressed as follows.

To:
 
Tully's Coffee Corporation
3100 Airport Way South
Seattle, WA 98134 U.S.A.
Attn: Mr. Jamie S. Colbourne
Facsimile No. (206) 233-2077

with a copy to:

 

Carney Badley Smith & Spellman, P.S.
2200 Bank of America Tower
701 Fifth Avenue
Seattle, Washington 98104
Attn: Patrick R. Lamb
Facsimile No. (206) 467-8215

To:

 

Tully's Coffee of Japan Ltd.
3-4-1 Takanawa, Minato-ku
Tokyo, Japan
Attn: Kouta Matsuda
Facsimile No. 03-5798-8021

or to such other address as the party to receive the notice or request shall
designate by written notice to the other. The effective date of any notice or
request shall be five (5) days from the date on which it is sent by the
addressor, or when received when personally delivered or sent by facsimile.

        27.      Waiver.    The failure of either party to insist in any one or
more instances upon strict performance by the other of its obligations hereunder
shall not constitute a waiver or relinquishment of any such obligation for the
future, and the obligation shall continue in full force and effect.

        28.      Governing Law.    This Agreement shall be governed by and
construed in accordance with the laws of the State of Washington, U.S.A. without
giving effect to the conflict of law rules or choice of law rules thereof, and
by applicable federal law.

        29.      Warranty of Authority.    All corporate parties hereto and the
individuals executing this Agreement on behalf of said corporations warrant that
said corporations have corporate authority to

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enter into this Agreement and that the individuals executing on behalf of each
corporation have the authority to execute this Agreement on behalf of their
respective corporation. Licensor and Licensee each warrant the authority of the
individual executing on their behalf and hereby each consents to the execution
of this Agreement.

        30.      Representations as to Corporate Authority.    All corporate
parties hereto and the individuals executing these documents on behalf of said
corporations warrant that said corporations have corporate authority to enter
into this Agreement and that the individual executing on behalf of each
corporation has the authority to execute this Agreement on behalf of the
respective corporation.

        31.      Headings.    Headings used in this Agreement are for reference
purposes only and shall not be deemed part of this Agreement.

        32.      Relationship.    The relationship between the parties hereto is
that of Licensor and Licensee as defined in this Agreement, and this Agreement
is not to be construed as creating a partnership, joint venture, master-servant,
principal-agent, or other relationship for any purpose whatsoever. Except as may
be expressly provided herein, neither party may be held for the acts either of
omission or commission of the other party, and neither party is authorized to,
or has the power to, obligate or bind the other party by contract, agreement,
warranty, representation or otherwise in any manner whatsoever.

        33.      Force Majeure.    If either party is delayed or interrupted in
or prevented from, the performance of its obligations hereunder by reason of an
act of God, fire, flood, war, public disaster, strikes or labor difficulties,
governmental enactment, regulation or order, or any other cause beyond its
control, such party shall not be liable to the other therefor; and the time for
the performance of its obligations shall thereupon be extended for a period
equal to the duration of the contingency that occasioned the delay, interruption
or prevention.

        34.      Integration and Modification.    This is the entire agreement
between the parties with respect to the subject matters hereof. For such
matters, there are no other agreements or representations not set forth herein,
and this Agreement incorporates all prior negotiations, agreements, and
representations. This Agreement may not be modified except in writing signed by
each party.

        35.      Languages.    Both parties acknowledge that this agreement is
written in both Japanese and English. In case of doubt as to the interpretation
of any of the provisions of this agreement, the English version shall be
controlling.

        36.      Counterparts.    This Agreement may be signed in one or more
counterparts, each of which may be deemed an original, but all of which together
shall constitute one and the same agreement notwithstanding that both parties
are not signatories to each counterpart, however, this agreement shall not be
enforceable against any party until a counterpart has been executed by both
parties hereto.

        37.      Waiver of Breach.    The waiver by either party of any breach
of this Agreement shall not be deemed a waiver of any subsequent breach.

[The remainder of this page has been left blank intentionally.]

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Executed as of the date set forth above.

LICENSOR:
 

TULLY'S COFFEE CORPORATION

 
 
 
 
 
By:
 
 
 
 
 

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Jamie S. Colbourne, its President and CEO
 
 
 
 
 
 
 
 
 
LICENSEE:
 

TULLY'S COFFEE JAPAN, LTD.

 
 
 
 
 
By:
 
 
 
 
 

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                                                                         , its
            
 

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SCHEDULE A
TO
TULLY'S COFFEE LICENSE AGREEMENT

LIST OF BUSINESS NAMES

Tully's
Tully's Coffee
Tully's Roaster of Fine Coffee
Swirkle
Tullini
Tullini Sandwiches

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SCHEDULE B
TO
TULLY'S COFFEE LICENSE AGREEMENT

LIST OF TRADEMARKS FOR SERVICES AND GOODS

See attached Status Report dated February 14, 2001

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SCHEDULE C
TO
TULLY'S COFFEE LICENSE AGREEMENT

LIST OF EXISTING FRANCHISEES IN THE TERRITORY:

Design Exchange Co., Ltd.
Lightous International Co., Ltd.
Mays & Friends

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QuickLinks

TULLY'S COFFEE LICENSE AGREEMENT
SCHEDULE A TO TULLY'S COFFEE LICENSE AGREEMENT
SCHEDULE B TO TULLY'S COFFEE LICENSE AGREEMENT
SCHEDULE C TO TULLY'S COFFEE LICENSE AGREEMENT