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CERTIFIED MAIL - RETURN RECEIPT REQUESTED
Wolfe's Borough Coffee d/b/a Black Bear Micro Roastery P.O. Box 31 Ctr Tiftonboro, NH 03819 Att. Mr. Jim Clark
Re:
	Starbucks Corp., u Washington Corp. and Starbucks U.S. Brands, Inc., a California Corp. v Wolfe's Borough Coffee
*Insured*		:	Wolfe's Borough Coffee
	Claimant	:	Starbucks US Br Starbucks Corporation
	Claim No.	:	56400666470-001
	Policy No.	:	PAS 30929054
	Eff.	:	3/10/2001 to 3/10/2002
		:	07/03/01

Dear Mr. Clark:

We have received your letter of June 5, 2002, together with the policy of insurance and our prior communications to you concerning this matter. We regret to advise you that we must adhere to our determination that no coverage or defense obligation exists with respect to plaintiff's proposed Amended Complaint and that we must therefore withdraw from your defense when and if the Amended Complaint becomes the operative pleading in this litigation.

Although the subject policy does not define the term "damages," we have concluded that under insurance industry intent and relevant case law, the term "damages" does not encompass the attorneys' fees and costs sought, in plaintiff’s proposed Amended Complaint in this matter. We accordingly must adhere to our determination to disclaim liability and withdraw from your defense when and if the proposed Amended Complaint becomes the operative pleading in this matter.

With respect to the other assertions in your letter, we regret that you apparently feel that we are acting in concert with plaintiff Starbucks or are somehow involved with Starbucks in alleged "restraint of trade." We assure you that this is not so. We are obligated to analyze coverage for any pleadings sought to be asserted against you, that is what we have done in this case.

Should you have questions concerning any of the foregoing, please do not hesitate to contact the undersigned.