Diedrich Coffee, Inc. (Nasdaq: DDRX), franchisor of the Gloria Jean’s Coffees, Diedrich Coffee, and Coffee People brands, announced today that its chief executive officer, Philip G. Hirsch, had tendered his resignation to the board of directors of the company, effective January 3, 2003.

Effective immediately, and until the company retains a new CEO, Matthew McGuinness, executive vice president and chief financial officer, and Pamela Britton, vice president and chief operating officer, will be responsible for the day-to-day operations of the company. They will report directly to a committee of the board of directors, headed by Chairman Paul C. Heeschen, which has been formed to oversee operations.

Mr. Hirsch indicated that he would be available to assist the company during the transition to a new chief executive officer. The board of directors has initiated a search for a replacement for Mr. Hirsch.