Document:

<PAGE>

                                                                   EXHIBIT 10.10

                           PEET'S COFFEE & TEA, INC.

                 2000 NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN

                           Adopted November 1, 2000
                  Approved By Shareholders November 17, 2000

1.   Purposes.

     (a)  Eligible Option Recipients. The persons eligible to receive Options
are the Non-Employee Directors of the Company.

     (b)  Available Options. The purpose of the Plan is to provide a means by
which Non-Employee Directors may be given an opportunity to benefit from
increases in value of the Common Stock through the granting of Nonstatutory
Stock Options.

     (c)  General Purpose. The Company, by means of the Plan, seeks to retain
the services of its Non-Employee Directors, to secure and retain the services of
new Non-Employee Directors and to provide incentives for such persons to exert
maximum efforts for the success of the Company and its Affiliates.

2.   Definitions.

     (a)  "Affiliate" means any parent corporation or subsidiary corporation of
the Company, whether now or hereafter existing, as those terms are defined in
Sections 424(e) and (f), respectively, of the Code.

     (b)  "Annual Grant" means an Option granted annually to all Non-Employee
Directors who meet the criteria specified in subsection 6(b) of the Plan.

     (c)  "Annual Meeting" means the annual meeting of the shareholders of the
Company.

     (d)  "Board" means the Board of Directors of the Company.

     (e)  "Code" means the Internal Revenue Code of 1986, as amended.

     (f)  "Common Stock" means the common stock of the Company.

     (g)  "Company" means Peet's Coffee & Tea, Inc., a Washington corporation.

     (h)  "Consultant" means any person, including an advisor, (i) engaged by
the Company or an Affiliate to render consulting or advisory services and who is
compensated for such services or (ii) who is a member of the Board of Directors
of an Affiliate. However, the term "Consultant" shall not include either
Directors of the Company who are not compensated

                                       1.
<PAGE>

by the Company for their services as Directors or Directors of the Company who
are merely paid a director's fee by the Company for their services as Directors.

     (i)  "Continuous Service" means that the Optionholder's service with the
Company or an Affiliate, whether as an Employee, Director or Consultant, is not
interrupted or terminated.  The Optionholder's Continuous Service shall not be
deemed to have terminated merely because of a change in the capacity in which
the Optionholder renders service to the Company or an Affiliate as an Employee,
Consultant or Director or a change in the entity for which the Optionholder
renders such service, provided that there is no interruption or termination of
the Optionholder's service.  For example, a change in status without
interruption from a Non-Employee Director of the Company to a Consultant of an
Affiliate or an Employee of the Company will not constitute an interruption of
Continuous Service.  The Board or the chief executive officer of the Company, in
that party's sole discretion, may determine whether Continuous Service shall be
considered interrupted in the case of any leave of absence approved by that
party, including sick leave, military leave or any other personal leave.

     (j)  "Director" means a member of the Board of Directors of the Company.

     (k)  "Disability" means the inability of a person, in the opinion of a
qualified physician acceptable to the Company, to perform the major duties of
that person's position with the Company or an Affiliate of the Company because
of the sickness or injury of the person.

     (l)  "Employee" means any person employed by the Company or an Affiliate.
Mere service as a Director or payment of a director's fee by the Company or an
Affiliate shall not be sufficient to constitute "employment" by the Company or
an Affiliate.

     (m)  "Exchange Act" means the Securities Exchange Act of 1934, as amended.

     (n)  "Fair Market Value" means, as of any date, the value of the Common
Stock determined as follows:

          (i)   If the Common Stock is listed on any established stock exchange
or traded on the Nasdaq National Market or the Nasdaq SmallCap Market, the Fair
Market Value of a share of Common Stock shall be the closing sales price for
such stock (or the closing bid, if no sales were reported) as quoted on such
exchange or market (or the exchange or market with the greatest volume of
trading in the Common Stock) on the last market trading day prior to the day of
determination, as reported in The Wall Street Journal or such other source as
the Board deems reliable.

          (ii)  In the absence of such markets for the Common Stock, the Fair
Market Value shall be determined in good faith by the Board.

     (o)  "Initial Grant" means an Option granted to a Non-Employee Director who
meets the criteria specified in subsection 6(a) of the Plan.

     (p)  "IPO Date" means the effective date of the initial public offering of
the Common Stock.

                                       2.
<PAGE>

     (q)  "Non-Employee Director" means a Director who is not an Employee.

     (r)  "Nonstatutory Stock Option" means an Option not intended to qualify as
an incentive stock option within the meaning of Section 422 of the Code and the
regulations promulgated thereunder.

     (s)  "Officer" means a person who is an officer of the Company within the
meaning of Section 16 of the Exchange Act and the rules and regulations
promulgated thereunder.

     (t)  "Option" means a Nonstatutory Stock Option granted pursuant to the
Plan.

     (u)  "Option Agreement" means a written agreement between the Company and
an Optionholder evidencing the terms and conditions of an individual Option
grant. Each Option Agreement shall be subject to the terms and conditions of the
Plan.

     (v)  "Optionholder" means a person to whom an Option is granted pursuant to
the Plan or, if applicable, such other person who holds an outstanding Option.

     (w)  "Plan" means this Peet's Coffee & Tea, Inc. 2000 Non-Employee Director
Stock Option Plan.

     (x)  "Rule 16b-3" means Rule 16b-3 promulgated under the Exchange Act or
any successor to Rule 16b-3, as in effect from time to time.

     (y)  "Securities Act" means the Securities Act of 1933, as amended.

3.   Administration.

     (a)  Administration by Board. The Board shall administer the Plan. The
Board may not delegate administration of the Plan to a committee.

     (b)  Powers of Board. The Board shall have the power, subject to, and
within the limitations of, the express provisions of the Plan:

          (i)   To determine the provisions of each Option to the extent not
specified in the Plan.

          (ii)  To construe and interpret the Plan and Options granted under it,
and to establish, amend and revoke rules and regulations for its administration.
The Board, in the exercise of this power, may correct any defect, omission or
inconsistency in the Plan or in any Option Agreement, in a manner and to the
extent it shall deem necessary or expedient to make the Plan fully effective.

          (iii) To amend the Plan or an Option as provided in Section 12.

          (iv)  To terminate or suspend the Plan as provided in Section 13.

                                       3.
<PAGE>

          (v)   Generally, to exercise such powers and to perform such acts as
the Board deems necessary or expedient to promote the best interests of the
Company that are not in conflict with the provisions of the Plan.

     (c)  Effect of Board's Decision. All determinations, interpretations and
constructions made by the Board in good faith shall not be subject to review by
any person and shall be final, binding and conclusive on all persons.

4.   Shares Subject to the Plan.

     (a)  Share Reserve.  Subject to the provisions of Section 11 relating to
adjustments, the Common Stock that may be issued pursuant to Options shall not
exceed three hundred thirty thousand (330,000) shares of Common Stock (the
"Reserved Shares").  As of each annual meeting of the Company's shareholders,
beginning in 2002, and continuing through and including the annual meeting of
the Company's shareholders in 2020, the number of Reserved Shares will be
increased automatically by the least of (i) three quarters of one percent
(0.75%) of the total number of shares of Common Stock outstanding on such date,
(ii) sixty thousand (60,000) shares, or (iii) a number of shares determined by
the Board prior to such date, which number shall be less than (i) and (ii)
above.

     (b)  Reversion of Shares to the Share Reserve.  If any Option shall for any
reason expire or otherwise terminate, in whole or in part, without having been
exercised in full, the shares of Common Stock not acquired under such Option
shall revert to and again become available for issuance under the Plan.

     (c)  Source of Shares. The shares of Common Stock subject to the Plan may
be unissued shares or reacquired shares, bought on the market or otherwise.

5.   Eligibility.

     The Options as set forth in Section 6 of the Plan automatically shall be
granted under the Plan to all Non-Employee Directors.

6.   Non-Discretionary Grants.

     (a)  Initial Grants. Without any further action of the Board, each person
who is a Non-Employee Director on the IPO Date or who is elected or appointed
for the first time to be a Non-Employee Director after the IPO Date
automatically shall, upon the IPO Date, or upon the date of his or her initial
election or appointment to be a Non-Employee Director by the Board or
shareholders of the Company, whichever date is applicable, be granted an Initial
Grant to purchase twenty-five thousand (25,000) shares of Common Stock on the
terms and conditions set forth herein.

     (b)  Annual Grants. Without any further action of the Board, a Non-Employee
Director shall be granted an Annual Grant as follows: On the day following each
Annual Meeting commencing with the Annual Meeting in 2001, each person who is
then a Non-Employee Director automatically shall be granted an Annual Grant to
purchase ten thousand (10,000) shares of Common Stock on the terms and
conditions set forth herein; provided,

                                       4.
<PAGE>

however, that if the person has not been serving as a Non-Employee Director for
the entire twelve (12) month period since the preceding Annual Meeting, then the
number of shares subject to the Annual Grant shall be reduced pro rata for each
full month prior to the date of grant during which such person did not serve as
a Non-Employee Director.

7.   Option Provisions.

     Each Option shall be in such form and shall contain such terms and
conditions as required by the Plan.  Each Option shall contain such additional
terms and conditions, not inconsistent with the Plan, as the Board shall deem
appropriate.  Each Option shall include (through incorporation of provisions
hereof by reference in the Option or otherwise) the substance of each of the
following provisions:

     (a)  Term.  No Option shall be exercisable after the expiration of ten (10)
years from the date it was granted.

     (b)  Exercise Price. The exercise price of each Option shall be one hundred
percent (100%) of the Fair Market Value of the stock subject to the Option on
the date the Option is granted. Notwithstanding the foregoing, an Option may be
granted with an exercise price lower than that set forth in the preceding
sentence if such Option is granted pursuant to an assumption or substitution for
another option in a manner satisfying the provisions of Section 424(a) of the
Code.

     (c)  Consideration. The purchase price of stock acquired pursuant to an
Option may be paid, to the extent permitted by applicable statutes and
regulations, in any combination of the following methods:

          (i)   By cash or check.

          (ii)  Provided that at the time of exercise the Common Stock is
publicly traded and quoted regularly in The Wall Street Journal, by delivery of
already-owned shares of Common Stock either that the Optionholder has held for
the period required to avoid a charge to the Company's reported earnings
(generally six months) or that the Optionholder did not acquire, directly or
indirectly from the Company, that are owned free and clear of any liens, claims,
encumbrances or security interests, and that are valued at Fair Market Value on
the date of exercise. "Delivery" for these purposes shall include delivery to
the Company of the Optionholder's attestation of ownership of such shares of
Common Stock in a form approved by the Company. Notwithstanding the foregoing,
the Optionholder may not exercise the Option by tender to the Company of Common
Stock to the extent such tender would violate the provisions of any law,
regulation or agreement restricting the redemption of the Company's stock.

          (iii) Provided that at the time of exercise the Common Stock is
publicly traded and quoted regularly in The Wall Street Journal, pursuant to a
program developed under Regulation T as promulgated by the Federal Reserve Board
that, prior to the issuance of Common Stock, results in either the receipt of
cash (or check) by the Company or the receipt of irrevocable instructions to pay
the aggregate exercise price to the Company from the sales proceeds.

                                       5.
<PAGE>

     (d)  Transferability.  An Option is transferable by will or by the laws of
descent and distribution.  An Option also is transferable (i) by instrument to
an inter vivos or testamentary trust, in a form accepted by the Company, in
which the Option is to be passed to beneficiaries upon the death of the trustor
(settlor) and (ii) by gift, in a form accepted by the Company, to a member of
the "immediate family" of the Optionholder as that term is defined in 17 C.F.R.
240.16a-1(e).  An Option shall be exercisable during the lifetime of the
Optionholder only by the Optionholder and a permitted transferee as provided
herein.  However, the Optionholder may, by delivering written notice to the
Company, in a form satisfactory to the Company, designate a third party who, in
the event of the death of the Optionholder, shall thereafter be entitled to
exercise the Option.

     (e)  Exercise Schedule.  The Option shall be exercisable as the shares of
Common Stock subject to the Option vest.

     (f)  Vesting Schedule.  Following the date an Option is granted, the Option
shall vest on a monthly basis as to 1/36th of the shares subject to the Option.

     (g)  Termination of Continuous Service.  In the event an Optionholder's
Continuous Service terminates (other than upon the Optionholder's death or
Disability), the Optionholder may exercise his or her Option (to the extent that
the Optionholder was entitled to exercise it as of the date of termination) but
only within such period of time ending on the earlier of (i) the date three (3)
months following the termination of the Optionholder's Continuous Service, or
(ii) the expiration of the term of the Option as set forth in the Option
Agreement.  If, after termination, the Optionholder does not exercise his or her
Option within the time specified in the Option Agreement, the Option shall
terminate.

     (h)  Extension of Termination Date. If the exercise of the Option following
the termination of the Optionholder's Continuous Service (other than upon the
Optionholder's death or Disability) would be prohibited at any time solely
because the issuance of shares would violate the registration requirements under
the Securities Act, then the Option shall terminate on the earlier of (i) the
expiration of the term of the Option set forth in subsection 7(a) or (ii) the
expiration of a period of three (3) months after the termination of the
Optionholder's Continuous Service during which the exercise of the Option would
not be in violation of such registration requirements.

     (i)  Disability of Optionholder.  In the event an Optionholder's Continuous
Service terminates as a result of the Optionholder's Disability, the
Optionholder may exercise his or her Option (to the extent that the Optionholder
was entitled to exercise it as of the date of termination), but only within such
period of time ending on the earlier of (i) the date twelve (12) months
following such termination or (ii) the expiration of the term of the Option as
set forth in the Option Agreement.  If, after termination, the Optionholder does
not exercise his or her Option within the time specified herein, the Option
shall terminate.

     (j)  Death of Optionholder.  In the event (i) an Optionholder's Continuous
Service terminates as a result of the Optionholder's death or (ii) the
Optionholder dies within the three-month period after the termination of the
Optionholder's Continuous Service for a reason other than death, then the Option
may be exercised (to the extent the Optionholder was entitled to

                                       6.
<PAGE>

exercise the Option as of the date of death) by the Optionholder's estate, by a
person who acquired the right to exercise the Option by bequest or inheritance
or by a person designated to exercise the Option upon the Optionholder's death,
but only within the period ending on the earlier of (1) the date eighteen (18)
months following the date of death or (2) the expiration of the term of such
Option as set forth in the Option Agreement. If, after death, the Option is not
exercised within the time specified herein, the Option shall terminate.

8.   Covenants of the Company.

     (a)  Availability of Shares.  During the terms of the Options, the Company
shall keep available at all times the number of shares of Common Stock required
to satisfy such Options.

     (b)  Securities Law Compliance.  The Company shall seek to obtain from each
regulatory commission or agency having jurisdiction over the Plan such authority
as may be required to grant Options and to issue and sell shares of Common Stock
upon exercise of the Options; provided, however, that this undertaking shall not
require the Company to register under the Securities Act the Plan, any Option or
any stock issued or issuable pursuant to any such Option.  If, after reasonable
efforts, the Company is unable to obtain from any such regulatory commission or
agency the authority which counsel for the Company deems necessary for the
lawful issuance and sale of stock under the Plan, the Company shall be relieved
from any liability for failure to issue and sell stock upon exercise of such
Options unless and until such authority is obtained.

9.   Use of Proceeds from Stock.

     Proceeds from the sale of stock pursuant to Options shall constitute
general funds of the Company.

10.  Miscellaneous.

     (a)  Stockholder Rights. No Optionholder shall be deemed to be the holder
of, or to have any of the rights of a holder with respect to, any shares subject
to such Option unless and until such Optionholder has satisfied all requirements
for exercise of the Option pursuant to its terms.

     (b)  No Service Rights.  Nothing in the Plan or any instrument executed or
Option granted pursuant thereto shall confer upon any Optionholder any right to
continue to serve the Company as a Non-Employee Director or shall affect the
right of the Company or an Affiliate to terminate (i) the employment of an
Employee with or without notice and with or without cause, (ii) the service of a
Consultant pursuant to the terms of such Consultant's agreement with the Company
or an Affiliate or (iii) the service of a Director pursuant to the Bylaws of the
Company or an Affiliate, and any applicable provisions of the corporate law of
the state in which the Company or the Affiliate is incorporated, as the case may
be.

     (c)  Investment Assurances.  The Company may require an Optionholder, as a
condition of exercising or acquiring stock under any Option, (i) to give written
assurances satisfactory to the Company as to the Optionholder's knowledge and
experience in financial and business matters and/or to employ a purchaser
representative reasonably satisfactory to the

                                       7.
<PAGE>

Company who is knowledgeable and experienced in financial and business matters
and that he or she is capable of evaluating, alone or together with the
purchaser representative, the merits and risks of exercising the Option; and
(ii) to give written assurances satisfactory to the Company stating that the
Optionholder is acquiring the stock subject to the Option for the Optionholder's
own account and not with any present intention of selling or otherwise
distributing the stock. The foregoing requirements, and any assurances given
pursuant to such requirements, shall be inoperative if (1) the issuance of the
shares upon the exercise or acquisition of stock under the Option has been
registered under a then currently effective registration statement under the
Securities Act or (2) as to any particular requirement, a determination is made
by counsel for the Company that such requirement need not be met in the
circumstances under the then applicable securities laws. The Company may, upon
advice of counsel to the Company, place legends on stock certificates issued
under the Plan as such counsel deems necessary or appropriate in order to comply
with applicable securities laws, including, but not limited to, legends
restricting the transfer of the stock.

     (d)  Withholding Obligations. The Optionholder may satisfy any federal,
state or local tax withholding obligation relating to the exercise or
acquisition of stock under an Option by any of the following means (in addition
to the Company's right to withhold from any compensation paid to the
Optionholder by the Company) or by a combination of such means: (i) tendering a
cash payment; (ii) authorizing the Company to withhold shares from the shares of
the Common Stock otherwise issuable to the Optionholder as a result of the
exercise or acquisition of stock under the Option, provided, however, that no
shares of Common Stock are withheld with a value exceeding the minimum amount of
tax required to be withheld by law; or (iii) delivering to the Company owned and
unencumbered shares of the Common Stock.

11.  Adjustments upon Changes in Stock.

     (a)  Capitalization Adjustments. If any change is made in the stock subject
to the Plan, or subject to any Option, without the receipt of consideration by
the Company (through merger, consolidation, reorganization, recapitalization,
reincorporation, stock dividend, dividend in property other than cash, stock
split, liquidating dividend, combination of shares, exchange of shares, change
in corporate structure or other transaction not involving the receipt of
consideration by the Company), the Plan will be appropriately adjusted in the
class(es) and maximum number of securities subject both to the Plan pursuant to
subsection 4(a) and to the nondiscretionary Options specified in Section 5, and
the outstanding Options will be appropriately adjusted in the class(es) and
number of securities and price per share of stock subject to such outstanding
Options. The Board shall make such adjustments, and its determination shall be
final, binding and conclusive. (The conversion of any convertible securities of
the Company shall not be treated as a transaction "without receipt of
consideration" by the Company.)

     (b)  Dissolution or Liquidation. In the event of a dissolution or
liquidation of the Company, then all outstanding Options shall terminate
immediately prior to such event.

     (c)  Corporate Transaction.  In the event of (i) a sale, lease or other
disposition of all or substantially all of the securities or assets of the
Company, (ii) a merger or consolidation in which the Company is not the
surviving corporation or (iii) a reverse merger in which the

                                       8.
<PAGE>

Company is the surviving corporation but the shares of Common Stock outstanding
immediately preceding the merger are converted by virtue of the merger into
other property, whether in the form of securities, cash or otherwise (each, a
"Corporate Transaction"), then with respect to Options held by Optionholders
whose Continuous Service has not terminated, the vesting of such Options (and
the time during which such Options may be exercised) shall be accelerated in
full, and the Options shall terminate if not exercised at or prior to the
Corporate Transaction. With respect to any other Options outstanding under the
Plan, such Options shall terminate if not exercised prior to the Corporate
Transaction.

12.  Amendment of the Plan and Options.

     (a)  Amendment of Plan.  The Board at any time, and from time to time, may
amend the Plan.  However, except as provided in Section 11 relating to
adjustments upon changes in stock, no amendment shall be effective unless
approved by the shareholders of the Company to the extent stockholder approval
is necessary to satisfy the requirements of Rule 16b-3 or any Nasdaq or
securities exchange listing requirements.

     (b)  Stockholder Approval. The Board may, in its sole discretion, submit
any other amendment to the Plan for stockholder approval.

     (c)  No Impairment of Rights. Rights under any Option granted before
amendment of the Plan shall not be impaired by any amendment of the Plan unless
(i) the Company requests the consent of the Optionholder and (ii) the
Optionholder consents in writing.

     (d)  Amendment of Options. The Board at any time, and from time to time,
may amend the terms of any one or more Options; provided, however, that the
rights under any Option shall not be impaired by any such amendment unless (i)
the Company requests the consent of the Optionholder and (ii) the Optionholder
consents in writing.

13.  Termination or Suspension of the Plan.

     (a)  Plan Term. The Board may suspend or terminate the Plan at any time. No
Options may be granted under the Plan while the Plan is suspended or after it is
terminated .

     (b)  No Impairment of Rights. Suspension or termination of the Plan shall
not impair rights and obligations under any Option granted while the Plan is in
effect except with the written consent of the Optionholder.

14.  Effective Date of Plan.

     The Plan shall become effective on the IPO Date, but no Option shall be
exercised unless and until the Plan has been approved by the shareholders of the
Company, which approval shall be within twelve (12) months before or after the
date the Plan is adopted by the Board.

                                       9.
<PAGE>

15.  Choice of Law.

     All questions concerning the construction, validity and interpretation of
this Plan shall be governed by the law of the State of Washington, without
regard to such state's conflict of laws rules.

                                      10.
<PAGE>

                           Peet's Coffee & Tea, Inc.
                  2000 Non-Employee Director Stock Option Plan

                             Stock Option Agreement
                          (Nonstatutory Stock Option)

     Pursuant to your Stock Option Grant Notice ("Grant Notice") and this Stock
Option Agreement, Peet's Coffee and Tea, Inc. (the "Company") has granted you an
option under its 2000 Non-Employee Director Stock Option Plan (the "Plan") to
purchase the number of shares of the Company's Common Stock indicated in your
Grant Notice at the exercise price indicated in your Grant Notice.  Defined
terms not explicitly defined in this Stock Option Agreement but defined in the
Plan shall have the same definitions as in the Plan.

     The details of your option are as follows:

     1.  Vesting.  Subject to the limitations contained herein, your option will
vest as provided in your Grant Notice, provided that vesting will cease upon the
termination of your Continuous Service.

     2.  Number of Shares and Exercise Price. The number of shares of Common
Stock subject to your option and your exercise price per share referenced in
your Grant Notice may be adjusted from time to time for Capitalization
Adjustments, as provided in the Plan.

     3.  Method of Payment.  Payment of the exercise price is due in full upon
exercise of all or any part of your option.  You may elect to make payment of
the exercise price in cash or by check or in any other manner permitted by your
                                                              -----------------
Grant Notice, which may include one or more of the following:
------------

         (a)  In the Company's sole discretion at the time your option is
exercised and provided that at the time of exercise the Common Stock is publicly
traded and quoted regularly in The Wall Street Journal, pursuant to a program
developed under Regulation T as promulgated by the Federal Reserve Board that,
prior to the issuance of Common Stock, results in either the receipt of cash (or
check) by the Company or the receipt of irrevocable instructions to pay the
aggregate exercise price to the Company from the sales proceeds.

         (b)  Provided that at the time of exercise the Common Stock is publicly
traded and quoted regularly in The Wall Street Journal, by delivery of already-
owned shares of Common Stock either that you have held for the period required
to avoid a charge to the Company's reported earnings (generally six months) or
that you did not acquire, directly or indirectly from the Company, that are
owned free and clear of any liens, claims, encumbrances or security interests,
and that are valued at Fair Market Value on the date of exercise. "Delivery" for
these purposes, in the sole discretion of the Company at the time you exercise
your option, shall include delivery to the Company of your attestation of
ownership of such shares of Common Stock in a form approved by the Company.
Notwithstanding the foregoing, you may not exercise your option by tender to the
Company of Common Stock to the extent such tender

                                       1
<PAGE>

would violate the provisions of any law, regulation or agreement restricting the
redemption of the Company's stock.

     4.  Whole Shares.  You may exercise your option only for whole shares of
Common Stock.

     5.  Securities Law Compliance.  Notwithstanding anything to the contrary
contained herein, you may not exercise your option unless the shares of Common
Stock issuable upon such exercise are then registered under the Securities Act
or, if such shares of Common Stock are not then so registered, the Company has
determined that such exercise and issuance would be exempt from the registration
requirements of the Securities Act.  The exercise of your option must also
comply with other applicable laws and regulations governing your option, and you
may not exercise your option if the Company determines that such exercise would
not be in material compliance with such laws and regulations.

     6.  Term.  You may not exercise your option before the commencement of its
term or after its term expires. The term of your option commences on the Date of
Grant and expires upon the earliest of the following:

         (a)  three (3) months after the termination of your Continuous Service
for any reason other than your Disability or death, provided that if during any
part of such three- (3-) month period your option is not exercisable solely
because of the condition set forth in the preceding paragraph relating to
"Securities Law Compliance," your option shall not expire until the earlier of
the Expiration Date or until it shall have been exercisable for an aggregate
period of three (3) months after the termination of your Continuous Service;

         (b)  twelve (12) months after the termination of your Continuous
Service due to your Disability;

         (c)  eighteen (18) months after your death if you die either during
your Continuous Service or within three (3) months after your Continuous Service
terminates;

         (d)  the Expiration Date indicated in your Grant Notice; or

         (e)  the day before the tenth (10th) anniversary of the Date of Grant.

     7.  Exercise.

         (a)  You may exercise the vested portion of your option (and the
unvested portion of your option if your Grant Notice so permits) during its term
by delivering a Notice of Exercise (in a form designated by the Company)
together with the exercise price to the Secretary of the Company, or to such
other person as the Company may designate, during regular business hours,
together with such additional documents as the Company may then require.

         (b)  By exercising your option you agree that, as a condition to any
exercise of your option, the Company may require you to enter into an
arrangement providing for the payment by you to the Company of any tax
withholding obligation of the Company arising by reason of (1) the exercise of
your option, (2) the lapse of any substantial risk of forfeiture to

                                       2
<PAGE>

which the shares of Common Stock are subject at the time of exercise, or (3) the
disposition of shares of Common Stock acquired upon such exercise.

     8.  Transferability.  Your option is transferable to the extent provided in
the Plan and by will or by the laws of descent and distribution. In addition, by
delivering written notice to the Company, in a form satisfactory to the Company,
you may designate a third party who, in the event of your death, shall
thereafter be entitled to exercise your option.

     9.  Right of Repurchase.  To the extent provided in the Company's bylaws as
amended from time to time, the Company shall have the right to repurchase all or
any part of the shares of Common Stock you acquire pursuant to the exercise of
your option.

     10. Option Not A Service Contract. Your option is not an employment or
service contract, and nothing in your option shall be deemed to create in any
way whatsoever any obligation on your part to continue in the employ of the
Company or an Affiliate, or of the Company or an Affiliate to continue your
employment. In addition, nothing in your option shall obligate the Company or an
Affiliate, their respective shareholders, Boards of Directors, Officers or
Employees to continue any relationship that you might have as a Director or
Consultant for the Company or an Affiliate.

    11.  Withholding Obligations.

         (a)  At the time you exercise your option, in whole or in part, or at
any time thereafter as requested by the Company, you hereby authorize
withholding from payroll and any other amounts payable to you, and otherwise
agree to make adequate provision for (including by means of a "cashless
exercise" pursuant to a program developed under Regulation T as promulgated by
the Federal Reserve Board to the extent permitted by the Company), any sums
required to satisfy the federal, state, local and foreign tax withholding
obligations of the Company or an Affiliate, if any, which arise in connection
with your option.

         (b)  Upon your request and subject to approval by the Company, in its
sole discretion, and compliance with any applicable conditions or restrictions
of law, the Company may withhold from fully vested shares of Common Stock
otherwise issuable to you upon the exercise of your option a number of whole
shares of Common Stock having a Fair Market Value, determined by the Company as
of the date of exercise, not in excess of the minimum amount of tax required to
be withheld by law. If the date of determination of any tax withholding
obligation is deferred to a date later than the date of exercise of your option,
share withholding pursuant to the preceding sentence shall not be permitted
unless you make a proper and timely election under Section 83(b) of the Code,
covering the aggregate number of shares of Common Stock acquired upon such
exercise with respect to which such determination is otherwise deferred, to
accelerate the determination of such tax withholding obligation to the date of
exercise of your option. Notwithstanding the filing of such election, shares of
Common Stock shall be withheld solely from fully vested shares of Common Stock
determined as of the date of exercise of your option that are otherwise issuable
to you upon such exercise. Any adverse consequences to you arising in connection
with such share withholding procedure shall be your sole responsibility.

                                       3
<PAGE>

         (c)  You may not exercise your option unless the tax withholding
obligations of the Company and/or any Affiliate are satisfied. Accordingly, you
may not be able to exercise your option when desired even though your option is
vested, and the Company shall have no obligation to issue a certificate for such
shares of Common Stock or release such shares of Common Stock from any escrow
provided for herein.

    12.  Notices.  Any notices provided for in your option or the Plan shall be
given in writing and shall be deemed effectively given upon receipt or, in the
case of notices delivered by mail by the Company to you, five (5) days after
deposit in the United States mail, postage prepaid, addressed to you at the last
address you provided to the Company.

    13.  Governing Plan Document.  Your option is subject to all the provisions
of the Plan, the provisions of which are hereby made a part of your option, and
is further subject to all interpretations, amendments, rules and regulations
which may from time to time be promulgated and adopted pursuant to the Plan. In
the event of any conflict between the provisions of your option and those of the
Plan, the provisions of the Plan shall control.

                                       4<PAGE>

                                                                   EXHIBIT 10.11

                           Peet's Coffee & Tea, Inc.
                       2000 Employee Stock Purchase Plan

                Adopted by Board of Directors November 1, 2000
                  Approved by Shareholders November 17, 2000

1.   Purpose.

     (a)  The purpose of the Plan is to provide a means by which Employees of
the Company and certain designated Affiliates may be given an opportunity to
purchase common stock of the Company (the "Common Stock").

     (b)  The Company, by means of the Plan, seeks to retain the services of
such Employees, to secure and retain the services of new Employees and to
provide incentives for such persons to exert maximum efforts for the success of
the Company and its Affiliates.

     (c)  The Company intends that the Rights to purchase Common Stock granted
under the Plan be considered options issued under an "employee stock purchase
plan," as that term is defined in Section 423(b) of the Code.

2.   Definitions.

     (a)  "Affiliate" means any parent corporation or subsidiary corporation,
whether now or hereafter existing, as those terms are defined in Sections 424(e)
and (f), respectively, of the Code.

     (b)  "Board" means the Board of Directors of the Company.

     (c)  "Code" means the United States Internal Revenue Code of 1986, as
amended.

     (d)  "Committee" means a Committee appointed by the Board in accordance
with subparagraph 3(c) of the Plan.

     (e)  "Company" means Peet's Coffee & Tea, Inc., a Washington corporation.

     (f)  "Director" means a member of the Board.

     (g)  "Eligible Employee" means an Employee who meets the requirements set
forth in the Offering for eligibility to participate in the Offering.

     (h)  "Employee" means any person, including Officers and Directors,
employed by the Company or an Affiliate of the Company. Neither service as a
Director nor payment of a director's fee shall be sufficient to constitute
"employment" by the Company or the Affiliate.

     (i)  "Employee Stock Purchase Plan" means a plan that grants rights
intended to be options issued under an "employee stock purchase plan," as that
term is defined in Section 423(b) of the Code.

                                       1.
<PAGE>

     (j)  "Exchange Act" means the United States Securities Exchange Act of
1934, as amended.

     (k)  "Fair Market Value" means the value of a security, as determined in
good faith by the Board. If the security is listed on any established stock
exchange or traded on the Nasdaq National Market or the Nasdaq SmallCap Market,
then, except as otherwise provided in the Offering, the Fair Market Value of the
security shall be the closing sales price (rounded up where necessary to the
nearest whole cent) for such security (or the closing bid, if no sales were
reported) as quoted on such exchange or market (or the exchange or market with
the greatest volume of trading in the relevant security of the Company) on the
determination date, as reported in The Wall Street Journal or such other source
as the Board deems reliable.

     (l)  "Offering" means the grant of Rights to purchase Common Stock under
the Plan to Eligible Employees.

     (m)  "Offering Date" means a date selected by the Board for an Offering to
commence.

     (n)  "Participant" means an Eligible Employee who holds an outstanding
Right granted pursuant to the Plan or, if applicable, such other person who
holds an outstanding Right granted under the Plan.

     (o)  "Plan" means this 2000 Employee Stock Purchase Plan.

     (p)  "Purchase Date" means one or more dates established by the Board
during an Offering on which Rights granted under the Plan shall be exercised and
purchases of Common Stock carried out in accordance with such Offering.

     (q)  "Right" means an option to purchase Common Stock granted pursuant to
the Plan.

     (r)  "Securities Act" means the United States Securities Act of 1933, as
amended.

3.   Administration.

     (a)  The Board shall administer the Plan unless and until the Board
delegates administration to a Committee, as provided in subparagraph 3(c).
Whether or not the Board has delegated administration, the Board shall have the
final power to determine all questions of policy and expediency that may arise
in the administration of the Plan.

     (b)  The Board (or the Committee) shall have the power, subject to, and
within the limitations of, the express provisions of the Plan:

          (i)    To determine when and how Rights to purchase Common Stock shall
be granted and the provisions of each Offering of such Rights (which need not be
identical).

          (ii)   To designate from time to time which Affiliates of the Company
shall be eligible to participate in the Plan.

                                       2.
<PAGE>

          (iii)  To construe and interpret the Plan and Rights granted under it,
and to establish, amend and revoke rules and regulations for its administration.
The Board, in the exercise of this power, may correct any defect, omission or
inconsistency in the Plan, in a manner and to the extent it shall deem necessary
or expedient to make the Plan fully effective.

          (iv)   To amend the Plan as provided in paragraph 14.

          (v)    To terminate or suspend the Plan as provided in paragraph 16.

          (vi)   Generally, to exercise such powers and to perform such acts as
it deems necessary or expedient to promote the best interests of the Company and
its Affiliates and to carry out the intent that the Plan be treated as an
Employee Stock Purchase Plan.

     (C)  The Board may delegate administration of the Plan to a Committee of
the Board composed of two (2) or more members. If administration is delegated to
a Committee, the Committee shall have, in connection with the administration of
the Plan, the powers theretofore possessed by the Board, including the power to
delegate to a subcommittee of two (2) or more members any of the administrative
powers the Committee is authorized to exercise (and references in this Plan to
the Board shall thereafter be to the Committee or such a subcommittee), subject,
however, to such resolutions, not inconsistent with the provisions of the Plan,
as may be adopted from time to time by the Board. The Board may abolish the
Committee at any time and revest in the Board the administration of the Plan.

4.   Common Stock Subject to the Plan.

     (a)  Subject to the provisions of paragraph 13 relating to adjustments upon
changes in securities, the Common Stock that may be sold pursuant to Rights
granted under the Plan shall not exceed in the aggregate two hundred thousand
(200,000) shares (the "Reserved Shares").  As of each annual meeting of the
Company's shareholders, beginning in 2002, and continuing through and including
the annual meeting of the Company's shareholders in 2020, the number of Reserved
Shares will be automatically increased by the least of (i) one and one-half
percent (1.5%) of the total number of shares of Common Stock outstanding on such
date, (ii) two hundred thousand (200,000) shares or (iii) a number determined by
the Board.  If any Right granted under the Plan shall for any reason terminate
without having been exercised, the Common Stock not purchased under such Right
shall again become available for the Plan.

     (b)  The Common Stock subject to the Plan may be unissued shares or shares
that have been bought on the open market at prevailing market prices or
otherwise.

5.   Grant of Rights; Offering.

     (a)  The Board may from time to time grant or provide for the grant of
Rights to purchase Common Stock of the Company under the Plan to Eligible
Employees in an Offering on an Offering Date or Dates selected by the Board.
Each Offering shall be in such form and shall contain such terms and conditions
as the Board shall deem appropriate, which shall comply with the requirements of
Section 423(b)(5) of the Code that all Employees granted Rights to purchase
Common Stock under the Plan shall have the same rights and privileges. The terms
and conditions of an Offering shall be incorporated by reference into the Plan
and treated as part

                                       3.
<PAGE>

of the Plan. The provisions of separate Offerings need not be identical, but
each Offering shall include (through incorporation of the provisions of this
Plan by reference in the document comprising the Offering or otherwise) the
period during which the Offering shall be effective, which period shall not
exceed twenty-seven (27) months beginning with the Offering Date, and the
substance of the provisions contained in paragraphs 6 through 9, inclusive.

     (b)  If a Participant has more than one Right outstanding under the Plan,
unless he or she otherwise indicates in agreements or notices delivered
hereunder:  (i) each agreement or notice delivered by that Participant will be
deemed to apply to all of his or her Rights under the Plan, and (ii) an earlier-
granted Right (or a Right with a lower exercise price, if two Rights have
identical grant dates) will be exercised to the fullest possible extent before a
later-granted Right (or a Right with a higher exercise price if two Rights have
identical grant dates) will be exercised.

6.   Eligibility.

     (a)  Rights may be granted only to Employees of the Company or, as the
Board may designate as provided in subparagraph 3(b), to Employees of an
Affiliate.

          (i)    Except as provided in subparagraph 6(b), an Employee shall not
be eligible to be granted Rights under the Plan unless, on the Offering Date,
such Employee has been in the employ of the Company or the Affiliate, as the
case may be, for such continuous period preceding such grant as the Board may
require in the Offering, but in no event shall the required period of continuous
employment be equal to or greater than two (2) years.

          (ii)   The Board may provide in an Offering that Employees whose
customary employment is twenty (20) hours or less per week shall not be eligible
to participate.

          (iii)  The Board may provide in an Offering that Employees whose
customary employment is for not more than five (5) months in any calendar year
shall not be eligible to participate.

          (iv)   The Board may provide in an Offering that Employees who are
highly compensated Employees within the meaning of Section 423(b)(4)(D) of the
Code shall not be eligible to participate.

     (b)  The Board may provide that each person who, during the course of an
Offering, first becomes an Eligible Employee will, on a date or dates specified
in the Offering which coincides with the day on which such person becomes an
Eligible Employee or which occurs thereafter, receive a Right under that
Offering, which Right shall thereafter be deemed to be a part of that Offering.
Such Right shall have the same characteristics as any Rights originally granted
under that Offering, as described herein, except that:

          (i)    the date on which such Right is granted shall be the "Offering
Date" of such Right for all purposes, including determination of the exercise
price of such Right;

          (ii)   the period of the Offering with respect to such Right shall
begin on its Offering Date and end coincident with the end of such Offering; and

                                       4.
<PAGE>

          (iii)  the Board may provide that if such person first becomes an
Eligible Employee within a specified period of time before the end of the
Offering, he or she will not receive any Right under that Offering.

     (c)  No Employee shall be eligible for the grant of any Rights under the
Plan if, immediately after any such Rights are granted, such Employee owns stock
possessing five percent (5%) or more of the total combined voting power or value
of all classes of stock of the Company or of any Affiliate. For purposes of this
subparagraph 6(c), the rules of Section 424(d) of the Code shall apply in
determining the stock ownership of any Employee, and stock which such Employee
may purchase under all outstanding rights and options shall be treated as stock
owned by such Employee.

     (d)  An Eligible Employee may be granted Rights under the Plan only if such
Rights, together with any other Rights granted under all Employee Stock Purchase
Plans of the Company and any Affiliates, as specified by Section 423(b)(8) of
the Code, do not permit such Eligible Employee's rights to purchase common stock
of the Company or any Affiliate to accrue at a rate which exceeds twenty five
thousand dollars ($25,000) of the fair market value of such common stock
(determined at the time such Rights are granted) for each calendar year in which
such Rights are outstanding at any time.

7.   Rights; Purchase Price.

     (a)  On each Offering Date, each Eligible Employee, pursuant to an Offering
made under the Plan, shall be granted the Right to purchase up to the number of
Shares purchasable either:

          (i)    with a percentage designated by the Board not exceeding fifteen
percent (15%) of such Employee's Earnings (as defined by the Board in each
Offering) during the period which begins on the Offering Date (or such later
date as the Board determines for a particular Offering) and ends on the date
stated in the Offering, which date shall be no later than the end of the
Offering; or

          (ii)   with a maximum dollar amount designated by the Board that, as
the Board determines for a particular Offering, (1) shall be withheld, in whole
or in part, from such Employee's Earnings (as defined by the Board in each
Offering) during the period which begins on the Offering Date (or such later
date as the Board determines for a particular Offering) and ends on the date
stated in the Offering, which date shall be no later than the end of the
Offering and/or (2) shall be contributed, in whole or in part, by such Employee
during such period.

     (b)  The Board shall establish one or more Purchase Dates during an
Offering on which Rights granted under the Plan shall be exercised and purchases
of Common Stock carried out in accordance with such Offering.

     (c)  In connection with each Offering made under the Plan, the Board may
specify a maximum number of shares of Common Stock that may be purchased by any
Participant as well as a maximum aggregate number of shares of Common Stock that
may be purchased by all Participants pursuant to such Offering.  In addition, in
connection with each Offering that contains more than one Purchase Date, the
Board may specify a maximum aggregate number of

                                       5.
<PAGE>

shares of Common Stock that may be purchased by all Participants on any given
Purchase Date under the Offering. If the aggregate purchase of Common Stock upon
exercise of Rights granted under the Offering would exceed any such maximum
aggregate amount, the Board shall make a pro rata allocation of the Common Stock
available in as nearly a uniform manner as shall be practicable and as it shall
deem to be equitable.

     (d)  The purchase price of Common Stock acquired pursuant to Rights granted
under the Plan shall be not less than the lesser of:

          (i)    an amount equal to eighty-five percent (85%) of the fair market
value of the Common Stock on the Offering Date; or

          (ii)   an amount equal to eighty-five percent (85%) of the fair market
value of the Common Stock on the Purchase Date.

8.   Participation; Withdrawal; Termination.

     (a)  An Eligible Employee may become a Participant in the Plan pursuant to
an Offering by delivering a participation agreement to the Company within the
time specified in the Offering, in such form as the Company provides. Each such
agreement shall authorize payroll deductions of up to the maximum percentage
specified by the Board of such Employee's Earnings during the Offering (as
defined in each Offering). The payroll deductions made for each Participant
shall be credited to a bookkeeping account for such Participant under the Plan
and either may be deposited with the general funds of the Company or may be
deposited in a separate account in the name of, and for the benefit of, such
Participant with a financial institution designated by the Company. To the
extent provided in the Offering, a Participant may reduce (including to zero) or
increase such payroll deductions. To the extent provided in the Offering, a
Participant may begin such payroll deductions after the beginning of the
Offering. A Participant may make additional payments into his or her account
only if specifically provided for in the Offering and only if the Participant
has not already had the maximum permitted amount withheld during the Offering.

     (b)  At any time during an Offering, a Participant may terminate his or her
payroll deductions under the Plan and withdraw from the Offering by delivering
to the Company a notice of withdrawal in such form as the Company provides.
Such withdrawal may be elected at any time prior to the end of the Offering
except as provided by the Board in the Offering.  Upon such withdrawal from the
Offering by a Participant, the Company shall distribute to such Participant all
of his or her accumulated payroll deductions (reduced to the extent, if any,
such deductions have been used to acquire Common Stock for the Participant)
under the Offering, without interest unless otherwise specified in the Offering,
and such Participant's interest in that Offering shall be automatically
terminated.  A Participant's withdrawal from an Offering will have no effect
upon such Participant's eligibility to participate in any other Offerings under
the Plan but such Participant will be required to deliver a new participation
agreement in order to participate in subsequent Offerings under the Plan.

     (c)  Rights granted pursuant to any Offering under the Plan shall terminate
immediately upon cessation of any participating Employee's employment with the
Company or a

                                       6.
<PAGE>

designated Affiliate for any reason (subject to any post-employment
participation period required by law) or other lack of eligibility. The Company
shall distribute to such terminated Employee all of his or her accumulated
payroll deductions (reduced to the extent, if any, such deductions have been
used to acquire Common Stock for the terminated Employee) under the Offering,
without interest unless otherwise specified in the Offering. If the accumulated
payroll deductions have been deposited with the Company's general funds, then
the distribution shall be made from the general funds of the Company, without
interest.  If the accumulated payroll deductions have been deposited in a
separate account with a financial institution as provided in subparagraph 8(a),
then the distribution shall be made from the separate account, without interest
unless otherwise specified in the Offering.

     (d)  Rights granted under the Plan shall not be transferable by a
Participant otherwise than by will or the laws of descent and distribution, or
by a beneficiary designation as provided in paragraph 15 and, otherwise during
his or her lifetime, shall be exercisable only by the person to whom such Rights
are granted.

9.   Exercise.

     (a)  On each Purchase Date specified therefor in the relevant Offering,
each Participant's accumulated payroll deductions and other additional payments
specifically provided for in the Offering (without any increase for interest)
will be applied to the purchase of Common Stock up to the maximum number of
shares permitted pursuant to the terms of the Plan and the applicable Offering,
at the purchase price specified in the Offering. No fractional shares shall be
issued upon the exercise of Rights granted under the Plan unless specifically
provided for in the Offering.

     (b)  Unless otherwise specifically provided in the Offering, the amount, if
any, of accumulated payroll deductions remaining in any Participant's account
after the purchase of Common Stock that is equal to the amount required to
purchase one or more whole shares on the final Purchase Date of the Offering
shall be distributed in full to the Participant at the end of the Offering,
without interest. If the accumulated payroll deductions have been deposited with
the Company's general funds, then the distribution shall be made from the
general funds of the Company, without interest. If the accumulated payroll
deductions have been deposited in a separate account with a financial
institution as provided in subparagraph 8(a), then the distribution shall be
made from the separate account, without interest unless otherwise specified in
the Offering.

     (c)  No Rights granted under the Plan may be exercised to any extent unless
the Common Stock to be issued upon such exercise under the Plan (including
Rights granted thereunder) are covered by an effective registration statement
pursuant to the Securities Act and the Plan is in material compliance with all
applicable state, foreign and other securities and other laws applicable to the
Plan. If on a Purchase Date in any Offering hereunder the Plan is not so
registered or in such compliance, no Rights granted under the Plan or any
Offering shall be exercised on such Purchase Date, and the Purchase Date shall
be delayed until the Plan is subject to such an effective registration statement
and such compliance, except that the Purchase Date shall not be delayed more
than twelve (12) months and the Purchase Date shall in no event be more than
twenty-seven (27) months from the Offering Date. If, on the Purchase Date of any

                                       7.
<PAGE>

Offering hereunder, as delayed to the maximum extent permissible, the Plan is
not registered and in such compliance, no Rights granted under the Plan or any
Offering shall be exercised and all payroll deductions accumulated during the
Offering (reduced to the extent, if any, such deductions have been used to
acquire Common Stock) shall be distributed to the Participants, without interest
unless otherwise specified in the Offering. If the accumulated payroll
deductions have been deposited with the Company's general funds, then the
distribution shall be made from the general funds of the Company, without
interest. If the accumulated payroll deductions have been deposited in a
separate account with a financial institution as provided in subparagraph 8(a),
then the distribution shall be made from the separate account, without interest
unless otherwise specified in the Offering.

10.  Covenants of the Company.

     (a)  During the terms of the Rights granted under the Plan, the Company
shall ensure that the number of shares of Common Stock required to satisfy such
Rights are available.

     (b)  The Company shall seek to obtain from each federal, state, foreign or
other regulatory commission or agency having jurisdiction over the Plan such
authority as may be required to issue and sell Common Stock upon exercise of the
Rights granted under the Plan.  If, after reasonable efforts, the Company is
unable to obtain from any such regulatory commission or agency the authority
which counsel for the Company deems necessary for the lawful issuance and sale
of Common Stock under the Plan, the Company shall be relieved from any liability
for failure to issue and sell Common Stock upon exercise of such Rights unless
and until such authority is obtained.

11.  Use of Proceeds from Common Stock.

     Proceeds from the sale of Common Stock pursuant to Rights granted under the
Plan shall constitute general funds of the Company.

12.  Rights as a Shareholder.

     A Participant shall not be deemed to be the holder of, or to have any of
the rights of a holder with respect to, Common Stock subject to Rights granted
under the Plan unless and until the Participant's Common Stock acquired upon
exercise of Rights under the Plan are recorded in the books of the Company.

13.  Adjustments upon Changes in Securities.

     (a)  If any change is made in the Common Stock subject to the Plan, or
subject to any Right, without the receipt of consideration by the Company
(through merger, consolidation, reorganization, recapitalization,
reincorporation, stock dividend, dividend in property other than cash, stock
split, liquidating dividend, combination of shares, exchange of shares, change
in corporate structure or other transaction not involving the receipt of
consideration by the Company), the Plan will be appropriately adjusted in the
class(es) and maximum number of shares of Common Stock subject to the Plan
pursuant to subparagraph 4(a), and the outstanding Rights will be appropriately
adjusted in the class(es), number of shares of Common Stock and purchase limits
of such outstanding Rights. The Board shall make such adjustments, and its

                                       8.
<PAGE>

determination shall be final, binding and conclusive. (The conversion of any
convertible securities of the Company shall not be treated as a transaction that
does not involve the receipt of consideration by the Company.)

     (b)  In the event of a Corporate Transaction (as defined below), any
surviving corporation may assume outstanding Rights or substitute similar rights
for those outstanding under the Plan. In the event that no surviving corporation
assumes outstanding Rights or substitutes similar rights therefor, participants'
accumulated payroll deductions shall be used to purchase Common Stock
immediately prior to the transaction described above and the participants'
Rights under the ongoing Offering shall terminate immediately following such
purchase. For purposes of the Plan, "Corporate Transaction" means: (i) a
dissolution, liquidation or sale of all or substantially all of the securities
or assets of the Company, (ii) a merger or consolidation in which the Company is
not the surviving corporation or (iii) a reverse merger in which the Company is
the surviving corporation but the Common Stock outstanding immediately preceding
the merger is converted by virtue of the merger into other property, whether in
the form of securities, cash or otherwise.

14.  Amendment of the Plan.

          (i)    The Board at any time, and from time to time, may amend the
Plan. However, except as provided in paragraph 13 relating to adjustments upon
changes in securities and except as to amendments to benefit the administration
of the Plan, to take account of a change in legislation or to obtain or maintain
favorable tax, exchange control or regulatory treatment for Participants or the
Company or any Affiliate, no amendment shall be effective unless approved by the
shareholders of the Company to the extent stockholder approval is necessary for
the Plan to satisfy the requirements of Section 423 of the Code.

     It is expressly contemplated that the Board may amend the Plan in any
respect the Board deems necessary or advisable to provide Employees with the
maximum benefits provided or to be provided under the provisions of the Code and
the regulations promulgated thereunder relating to Employee Stock Purchase Plans
and/or to bring the Plan and/or Rights granted under it into compliance
therewith.

     (b)  Rights and obligations under any Rights granted before amendment of
the Plan shall not be impaired by any amendment of the Plan, except with the
consent of the person to whom such Rights were granted, or except as necessary
to comply with any laws or governmental regulations, or except as necessary to
ensure that the Plan and/or Rights granted under the Plan comply with the
requirements of Section 423 of the Code.

15.  Designation of Beneficiary.

     (a)  A Participant may file a written designation of a beneficiary who is
to receive any Common Stock and/or cash, if any, from the Participant's account
under the Plan in the event of such Participant's death subsequent to the end of
an Offering but prior to delivery to the Participant of such Common Stock and
cash. In addition, a Participant may file a written designation of a beneficiary
who is to receive any cash from the Participant's account under the Plan in the
event of such Participant's death during an Offering.

                                       9.
<PAGE>

     (b)  The Participant may change such designation of beneficiary at any time
by written notice. In the event of the death of a Participant and in the absence
of a beneficiary validly designated under the Plan who is living at the time of
such Participant's death, the Company shall deliver such Common Stock and/or
cash to the executor or administrator of the estate of the Participant, or if no
such executor or administrator has been appointed (to the knowledge of the
Company), the Company, in its sole discretion, may deliver such Common Stock
and/or cash to the spouse or to any one or more dependents or relatives of the
Participant, or if no spouse, dependent or relative is known to the Company,
then to such other person as the Company may designate.

16.  Termination or Suspension of the Plan.

     (a)  The Plan will terminate in 2020 unless the Board in its discretion
suspends or terminates the Plan sooner.  No Rights may be granted under the Plan
while the Plan is suspended or after it is terminated.

     (b)  Rights and obligations under any Rights granted while the Plan is in
effect shall not be impaired by suspension or termination of the Plan, except as
expressly provided in the Plan or with the consent of the person to whom such
Rights were granted, or except as necessary to comply with any laws or
governmental regulation, or except as necessary to ensure that the Plan and/or
Rights granted under the Plan comply with the requirements of Section 423 of the
Code.

17.  Effective Date of Plan.

     The Plan shall become effective as determined by the Board, but no Rights
granted under the Plan shall be exercised unless and until the Plan has been
approved by the shareholders of the Company within twelve (12) months before or
after the date the Plan is adopted by the Board, which date may be prior to the
effective date set by the Board.

                                      10.
<PAGE>

                           Peet's Coffee & Tea, Inc.
                       2000 Employee Stock Purchase Plan
                                    Offering

                           Adopted November 1, 2000

1.  Grant of Rights.

    (a)  The Board of Directors ("Board") of Peet's Coffee & Tea, Inc., a
Washington corporation (the "Company"), pursuant to the Company's 2000 Employee
Stock Purchase Plan (the "Plan"), hereby authorizes the grant of Rights to
purchase the common stock of the Company (the "Common Stock") to all Eligible
Employees (an "Offering"). Defined terms not explicitly defined in this Offering
but defined in the Plan shall have the same definitions as in the Plan. In the
event of any conflict between the provisions of an Offering and those of the
Plan (including interpretations, amendments, rules and regulations that may from
time to time be promulgated and adopted pursuant to the Plan), the provisions of
the Plan shall control.

    (b)  An "Offering Date" is the first day of an Offering. An Offering may
consist of one purchase period or may be divided into shorter purchase periods
("Purchase Periods"). A "Purchase Date" is the last day of a Purchase Period or
the Offering, as the case may be.

    (c)  Except as otherwise provided, each Offering hereunder shall be twenty-
four (24) months long and shall be divided into four (4) shorter Purchase
Periods approximately six (6) months in length. Offerings shall be consecutive.
A new Offering shall begin the day after the immediately preceding Offering
ends.

    (d)  The first Offering shall begin simultaneously with the effectiveness of
the Company's registration statement under the Securities Act of 1933 with
respect to the initial public offering of the Common Stock and end on November
30, 2002 (the "Initial Offering"). The Initial Offering will be divided into
four (4) shorter Purchase Periods of approximately six (6) months in duration,
with the initial Purchase Period ending on May 31, 2001, the second Purchase
Period ending on November 30, 2001, the third Purchase Period ending on May 31,
2002, and the fourth Purchase Period ending on November 30, 2002.

    (e)  Thereafter, new Offerings shall begin on each December 1, beginning
with December 1, 2002, and each such Offering shall end on the day prior to the
second anniversary of its Offering Date.

    (f)  Notwithstanding anything to the contrary, in the event that the fair
market value of a share of Common Stock on any Purchase Date during an Offering
is less than the fair market value of a share of Common Stock on the Offering
Date of such Offering, then following the purchase of Common Stock on such
Purchase Date: (i) the Offering shall terminate and (ii) all Participants in the
just-terminated Offering shall automatically be enrolled in a new Offering that
shall commence on the day following the Purchase Date on the same terms on which
such Participants were enrolled in the terminated Offering. Such new Offering
shall end on the day prior to the second anniversary of its Offering Date.

                                       1
<PAGE>

    (g)  Prior to the commencement of any Offering, the Board may change any or
all terms of such Offering and any subsequent Offerings. The granting of Rights
pursuant to each Offering hereunder shall occur on each respective Offering Date
unless, prior to such date (i) the Board (or such Committee) determines that
such Offering shall not occur, or (ii) no shares of Common Stock remain
available for issuance under the Plan in connection with the Offering.

2.  Eligible Employees.

    All employees of the Company shall be granted rights to purchase Common
Stock under each Offering on the Offering Date of such Offering (each, an
"Eligible Employee"); provided, however, that each Eligible Employee may
participate in only one Offering at any given time.  Each person who first
becomes an Eligible Employee during any Offering shall be granted a right to
purchase Common Stock under such Offering on the next June 1 or December 1
during such Offering, which right shall thereafter be deemed to be a part of
such Offering.  Such right shall have the same characteristics as any rights
originally granted under the Offering except that:

    (a)  the date on which such right is granted shall be the "Offering Date" of
such right for all purposes, including determination of the exercise price of
such right; and

    (b)  the Offering for such right shall begin on its Offering Date and end
coincident with the ongoing Offering.

3.  Rights.

    (a)  Subject to the limitations contained herein and in the Plan, on each
Offering Date each Eligible Employee shall be granted the right to purchase the
number of shares of Common Stock purchasable with up to fifteen percent (15%) of
such Participant's Earnings (as defined in Section 5(d)) paid during the period
of such Offering.

    (b)  The maximum aggregate number of shares available to be purchased by all
Eligible Employees under an Offering shall be the number of shares remaining
available under the Plan on the Offering Date. If the aggregate purchase of
shares of Common Stock upon exercise of rights granted under the Offering would
exceed the maximum aggregate number of shares available, the Board shall make a
pro rata allocation of the shares available in a uniform and equitable manner.

    (c)  Notwithstanding the foregoing, no employee shall be granted an option
under the Plan which permits such employee's right to purchase stock under this
Plan and all other employee stock purchase plans (described in Section 423 of
the Code) of the Company to accrue at a rate which exceeds twenty-five thousand
dollars ($25,000) of fair market value of such stock (determined at the time
such option is granted) for each calendar year in which such option is
outstanding at any time.

4.  Purchase Price.

    (a)  The purchase price of the Common Stock under the Offering shall be the
lesser of eighty-five percent (85%) of the fair market value of the Common Stock
on the Offering Date or

                                       2
<PAGE>

eighty-five percent (85%) of the fair market value of the Common Stock on the
Purchase Date, in each case rounded up to the nearest whole cent per Share.

    (b)  For the Initial Offering, the fair market value of the Common Stock at
the time when the Offering commences shall be the price per Share at which
Common Stock is first sold to the public in the Company's initial public
offering as specified in the final prospectus with respect to that offering.

5.  Participation.

    (a)  An Eligible Employee may elect to participate in an Offering only as of
the beginning of the Offering or on any subsequent June 1 or December 1. A
Participant who is enrolled in an Offering automatically will be enrolled in the
next Offering that commences after the current Offering ends.

    (b)  An Eligible Employee shall become a Participant in an Offering by
delivering an agreement authorizing payroll deductions. Such deductions must be
in whole percentages, with a minimum percentage of one percent (1%) and a
maximum percentage of fifteen percent (15%) of Earnings. A Participant may not
make additional payments into his or her account. The agreement shall be made on
such enrollment form as the Company provides, and must be delivered to the
Company before the Offering Date to be effective for such Offering, unless a
later time for filing the enrollment form is set by the Board for all Eligible
Employees with respect to a given Offering Date. For the Initial Offering, the
time for filing an enrollment form and commencing participation for individuals
who are Eligible Employees on the Offering Date for the Initial Offering may be
after the Offering Date, as determined by the Company and communicated to such
Eligible Employees.

    (c)  A Participant may increase or reduce (including to zero) his or her
participation level as of any June 1 or December 1 during an Offering. Any such
change in participation shall be made by delivering a notice to the Company or a
designated Affiliate in such form and at such time as the Company provides. In
addition, a Participant may withdraw from an Offering and receive his or her
accumulated payroll deductions from the Offering (reduced to the extent, if any,
such deductions have been used to acquire Common Stock for the Participant on
any prior Purchase Dates), without interest, at any time prior to the end of the
Offering, excluding the fifteen (15) day period immediately preceding the
Purchase Date, by delivering a withdrawal notice to the Company or designated
Affiliate in such form as the Company or designated Affiliate provides. A
Participant who has withdrawn from an Offering shall not again participate in
such Offering but may participate in subsequent Offerings under the Plan by
submitting a new participation agreement in accordance with the terms thereof.

    (d)  For the Initial Offering and subsequent Offerings hereunder, "Earnings"
means the total compensation paid to an employee, including all salary, wages
(including amounts elected to be deferred by the employee, that would otherwise
have been paid, under any cash or deferred arrangement established by the
Company), overtime pay, commissions, bonuses, and other remuneration paid
directly to the employee, but excluding profit sharing, the cost of employee
benefits paid for by the Company, education or tuition reimbursements, imputed
income arising under any Company group insurance or benefit program, traveling
expenses,

                                       3
<PAGE>

business and moving expense reimbursements, income received in connection with
stock options, contributions made by the Company under any employee benefit
plan, and similar items of compensation.

6.  Purchases.

    Subject to the limitations contained herein, on each Purchase Date, each
Participant's accumulated payroll deductions (without any increase for interest)
shall be applied to the purchase of whole shares of Common Stock, up to the
maximum number of shares permitted under the Plan and the Offering. "Purchase
Date" shall be defined as May 31, 2001, and each November 30 and May 31
thereafter. If a scheduled Purchase Date falls on a day on which the Common
Stock is not actively traded, then the Purchase Date shall be the nearest prior
day on which the Common Stock is actively traded.

7.  Notices and Agreements.

    Any notices or agreements provided for in an Offering or the Plan shall be
given in writing, in a form provided by the Company, and unless specifically
provided for in the Plan or this Offering shall be deemed effectively given upon
receipt or, in the case of notices and agreements delivered by the Company, five
(5) days after deposit in the United States mail, postage prepaid.

8.  Exercise Contingent on Stockholder Approval.

    The Rights granted under an Offering are subject to the approval of the
Plan by the shareholders as required for the Plan to obtain treatment as a tax-
qualified employee stock purchase plan under Section 423 of the Code or to
comply with the requirements of Rule 16b promulgated under the Securities
Exchange Act of 1934, as amended.

9.  Offering Subject to Plan.

    Each Offering is subject to all the provisions of the Plan, and its
provisions are hereby made a part of the Offering, and is further subject to all
interpretations, amendments, rules and regulations which may from time to time
be promulgated and adopted pursuant to the Plan.  In the event of any conflict
between the provisions of an Offering and those of the Plan (including
interpretations, amendments, rules and regulations which may from time to time
be promulgated and adopted pursuant to the Plan), the provisions of the Plan
shall control.

                                       4

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00018-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00018-of-00352.parquet"}]]