Grant of options

RNS Number:8294M
Caffe Nero Group PLC
26 June 2003



              Caffe Nero Group plc ("Caffe Nero" or "the Company)
              Proposed Purchase of Own Shares and Grant of Options



The Company has today posted a document giving notice of an extraordinary
general meeting, convened for 21 July 2003, at which shareholders will be asked
inter alia to approve the proposed purchase of shares from Banc Boston Capital
Holdings Limited ("Banc Boston" - a related party by virtue of its holding being
greater than ten per cent.) and to grant the Company the authority to make
market purchases of ordinary shares.



The Company has agreed in principle to buy 2.9 million shares from Banc Boston
at a fixed price of 20p and will have an option (exercisable until 27 August
2003) to purchase up to a further 1.6 million shares also at 20p.



In addition, the Company is seeking a general authority to repurchase up to a
further 3,405,538 shares (five per cent. of the ordinary shares now in issue) at
a maximum price of not more than five per cent. above the average market price
for such shares for the five business days immediately preceding the date of any
such purchase.  The Directors have no present intention to exercise this
authority.



The ability of the Company to repurchase shares and to make market purchases
requires Court Approval to a reduction in the share premium account to create a
distributable reserve.  Such Court Approval will be sought following the
extraordinary general meeting.



In addition to the above proposals, which would provide the Company with the
ability to reduce the number of shares in issue by up to 7,905,538 shares, the
Company announces that it has granted performance-related options over 9,650,000
shares pursuant to the No. 2 Scheme of The Caffe Nero Discretionary Share Option
Scheme, which was adopted at the time of the Company's flotation in March 2001.



These options have been granted at the current market price of 24p (save for
750,000 shares being approximately ten per cent of the total granted to Mr Ford,
which have an exercise price of 0.5p) and all require the achievement of
demanding earnings related performance targets, including inter alia cumulative
earnings growth of c.90% per annum for the financial years 2004 to 2006.  The
above options grant under the No. 2 Scheme aligns directors' remuneration with
the creation of shareholder value, and, accordingly, if the targets are not
achieved, the appropriate options will be cancelled.



The options have been granted to Executive Directors as follows: Mr Ford (7.15
million), Mr Reeve (1.4 million) and Mr Price (1.1 million).

26 June 2003



Enquiries:
Caffe Nero:                                                                            Tel:  [phone]
John Barnes, Chairman of the Remuneration Committee
Gerry Ford, CEO

College Hill:                                                                          Tel:  [phone]
Justine Warren




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