Krispy Kreme Annual Report

F I S C A L
2 0 1 3
A N N U A L
R E P O R T
Dear Fellow Shareholders:

Fiscal 2013 was a significant year for Krispy Kreme, as we further demonstrated the strength of our business model and laid the
foundation for many years of growth. Our collective efforts have resulted in an impressive list of successes.
Systemwide sales increased over 8% to almost $1 billion.
Company same-store sales grew 5.5%, driven by a 7.1% rise in customer
traffic. This marked our fourth consecutive year of positive comps.
Company wholesale revenues rose to over $150 million, driven by an
increase in average weekly sales per door.
Company Stores operating income grew to over $8 million from $300,000
in fiscal 2012.
Together with our franchise partners, we added a net 54 stores during
the year and operated 748 Krispy Kreme locations worldwide at year end.
We signed international development agreements for Taiwan, Singapore,

Moscow, and northern and southern/western India.
Domestic franchisees generated same-store sales growth of 6.8%, while
our international franchisees sales crossed the $400 million mark.
Operating income increased to $38 million from $26 million, and adjusted
net income rose to $34 million from $22 million.
Operating cash flow increased to $59 million, and we had a net cash
balance at year end of more than $40 million.
And finally, we repurchased $20 million of our shares at an average price
of $6.42.
Of course, these results would not be possible without the dedication of both our team members and our franchise partners who bring
passion to their jobs and who delight in sharing our signature doughnuts, sweet treats and delicious coffee with customers. I appreciate
their continued efforts and could not be more grateful for what they have achieved.
We at Krispy Kreme view ourselves as stewards of something very special an iconic brand whose products are renowned not only for
their taste and quality, but also for the joy that they bring. Our Company has a rich cultural heritage, and we take a great deal of pride in
featuring a selection of core favorites, innovative seasonal offerings, intriguing doughnut and beverage pairings, and flavors to please
local palates in each of the 22 countries we serve. But as strong as the physical cravings are for our products, we think that the emotional
cravings are even stronger.
Our market research and sales data prove that consumers around the world do not think of Krispy Kreme just in terms of early morning or late evening. They are willing to buy doughnuts throughout the day and night if we simply provide reasons for them to do so.
To that end, we are driving new use occasions by leveraging everyday events such as office parties, after school snacks and late night
doughnut runs, along with the various holiday occasions that are celebrated throughout the year. And to better engage our customers
and encourage their loyalty and visit frequency, we have also made concerted efforts to deepen our social media presence, expand our
local relationship marketing efforts, and enhance the in-store experience through our shop atmosphere and team member hospitality.
Interestingly, familiarity with Krispy Kreme mirrors that of companies with much larger footprints, and this suggests to us that our
opportunity for new store growth is significant. Our goal is to expand to 1,300 stores by fiscal 2017 through Company and both domestic
and international franchise development, and we think meeting this objective is well within our reach.
More specifically, we expect our growth will be fueled by our smaller store strategy, innovation and technology, a broader menu of oneof-a-kind products, domestic expansion and continued international development. Expanding our domestic franchise system will entail
infilling current territories and opening up the vast portion of the United States that has yet to be franchised. Internationally, development will consist of building more Krispy Kreme stores within our existing footprint while adding to our market presence through new
development agreements. Company store growth will be primarily in the southeastern United States, although we may consider adding
shops in other select markets.
We can certainly expect to encounter challenges in the years to come, but we believe our opportunities far outweigh these challenges.
I firmly believe our team members and our franchise partners are prepared to seize these opportunities and address all challenges with
the same energy, effort and commitment they displayed in fiscal 2013.
In summary, we believe our future is brighter than it has ever been. We are already blessed with several attributes that most companies spend a lifetime trying to attain: a brand that is beloved worldwide, best-in-class products, compelling long-term opportunities,
focused strategies, and an incredibly capable and energized team. We are committed to doing everything in our power
to continue building upon our current profitability. We are gratified by our fiscal 2013 accomplishments, and we
are optimistic that we can successfully achieve both our long-term aspirations and those of our shareholders.
We thank you for believing in us, our company, our brand, our products and our
future. We assure our shareholders that, as we move forward on our renewed path of
growth, we will live out our mission to touch and enhance lives through the JOY
that is Krispy Kreme in a manner that brings pride to Krispy Kreme and to all of
its constituencies.
Sincerely,
James H. Morgan
Chairman, President and
Chief Executive Officer
JOB TITLE Krispy Kreme 10K
REVISION 4
TYPE Clean
JOB NUMBER 246088
SERIAL <12345678>
DATE Thursday, April 25, 2013
PAGE NO. i
OPERATOR PM10
UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549
Form 10-K
(Mark one)
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended February3,2013
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission file number 001-16485
KRISPY KREME DOUGHNUTS, INC.

(Exact name of registrant as specified in its charter)
North Carolina
(State or other jurisdiction of

incorporation or organization)
56-2169715
(I.R.S. Employer Identification No.)
27103
370 Knollwood Street,

Winston-Salem, North Carolina
(Zip Code)
(Address of principal executive offices)
Registrants telephone number, including area code:

(336) 725-2981
Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class
Name of
Each Exchange
on Which
Registered
Common Stock, No Par Value

Preferred Share Purchase Rights
New York Stock Exchange

New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act:

None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes No
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes No
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements
for the past 90 days. Yes No
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required
to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to
submit and post such files). Yes No
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K ( 229.405 of this chapter) is not contained herein, and will
not be contained, to the best of registrants knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K.
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the
definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act.
Large accelerated filer Accelerated filerNon-accelerated filer Smaller Reporting Company
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes No
The aggregate market value of voting and non-voting common equity of the registrant held by nonaffiliates of the registrant as of July27,2012 was $414.1 million.
Number of shares of Common Stock, no par value, outstanding as of March22,2013: 65,357,963.
DOCUMENTS INCORPORATED BY REFERENCE:
Portions of the definitive proxy statement for the registrants 2013 Annual Meeting of Shareholders to be held on June18,2013 are incorporated by reference
into Part III hereof.

JOB NUMBER 246088
REVISION 4
SERIAL <12345678>
TYPE Clean
PAGE NO. ii

OPERATOR PM10
TABLE OF CONTENTS
Page
FORWARD-LOOKING STATEMENTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
PART I
Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Risk Factors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Unresolved Staff Comments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Properties. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Mine Safety Disclosures. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2
27
32
32
33
33
Item1.
Item1A.
Item1B.
Item2.
Item3.
Item4.
PART II
Item5.
Item6.
Item7.
Item7A.
Item8.
Item9.
Item9A.
Item9B.
Market for Registrants Common Equity, Related Stockholder Matters

and Issuer Purchases of Equity Securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Selected Financial Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Managements Discussion and Analysis of Financial Condition and Results of Operations. . . . . . .
Quantitative and Qualitative Disclosures about Market Risk. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Financial Statements and Supplementary Data. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure. . . . . . .
Controls and Procedures. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other Information. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
34
36
37
75
78
125
125
126
PART III
Item10.
Item11.
Item12.
Item13.
Item14.
Directors, Executive Officers and Corporate Governance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Executive Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder
Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Certain Relationships and Related Transactions, and Director Independence. . . . . . . . . . . . . . . . . .
Principal Accountant Fees and Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
127
127
127
127
127
PART IV
Item15.
Exhibits and Financial Statement Schedules. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
SIGNATURES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
128
132

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 1

OPERATOR PM10
As used herein, unless the context otherwise requires, Krispy Kreme, the Company, we, us and
our refer to Krispy Kreme Doughnuts, Inc. and its subsidiaries. References to fiscal 2014, fiscal 2013, fiscal
2012 and fiscal 2011 mean the fiscal years ended February 2, 2014, February 3, 2013, January 29, 2012 and
January 30, 2011, respectively. Please note that fiscal 2013 contained 53weeks.
FORWARD-LOOKING STATEMENTS
This Annual Report on Form 10-K contains forward-looking statements within the meaning of Section 27A
of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the
Exchange Act) that relate to our plans, objectives, estimates and goals. Statements expressing expectations regarding
our future and projections relating to products, sales, revenues, expenditures, costs and earnings are typical of such
statements, and are made under the Private Securities Litigation Reform Act of 1995. Forward-looking statements
are based on managements beliefs, assumptions and expectations of our future economic performance, considering
the information currently available to management. These statements are not statements of historical fact. Forwardlooking statements involve risks and uncertainties that may cause our actual results, performance or financial
condition to differ materially from the expectations of future results, performance or financial condition we express or
imply in any forward-looking statements. The words believe, may, could, will, should, would, anticipate,
estimate, expect, intend, objective, seek, strive or similar words, or the negative of these words, identify
forward-looking statements. Factors that could contribute to these differences include, but are not limitedto:

the quality of Company and franchise storeoperations;

our ability, and our dependence on the ability of our franchisees, to execute on our and their businessplans;

our relationships with ourfranchisees;

our ability to implement our international growthstrategy;

our ability to implement our domestic small shop operatingmodel;

political, economic, currency and other risks associated with our internationaloperations;

the price and availability of raw materials needed to produce doughnut mixes and other ingredients, and
the price of motorfuel;

our relationships with wholesalecustomers;

our ability to protect our trademarks and tradesecrets;

changes in customer preferences andperceptions;

risks associated withcompetition;

risks related to the food service industry, including food safety and protection of personalinformation;

compliance with government regulations relating to food products andfranchising;

increased costs or other effects of new government regulations relating to healthcarebenefits;

risks associated with implementation of new technology platforms; and

other factors discussed below in Item 1A, Risk Factors and in Krispy Kremes periodic reports and other
information filed with the United States Securities and Exchange Commission (the SEC).
All such factors are difficult to predict, contain uncertainties that may materially affect actual results and
may be beyond our control. New factors emerge from time to time, and it is not possible for management to predict
all such factors or to assess the impact of each such factor on the Company. Any forward-looking statement
speaks only as of the date on which such statement is made, and we do not undertake any obligation to update any
forward-looking statement to reflect events or circumstances after the date on which such statement ismade.
We caution you that any forward-looking statements are not guarantees of future performance and involve
known and unknown risks, uncertainties and other factors which may cause our actual results, performance or
achievements to differ materially from the facts, results, performance or achievements we have anticipated in such
forward-looking statements except as required by the federal securitieslaws.
REVISION 4
TYPE Clean
JOB NUMBER 246088
SERIAL <12345678>
PAGE NO. 2

OPERATOR PM10
PART I
Item 1.
BUSINESS.
Company Overview
Krispy Kreme is a leading branded retailer and wholesaler of high-quality doughnuts, complementary
beverages and treats and packaged sweets. The Companys principal business, which began in 1937, is owning and
franchising Krispy Kreme stores, at which a wide variety of high-quality doughnuts, including the Companys
Original Glazed doughnut, are sold and distributed together with complementary products, and where a broad
array of coffees and other beverages areoffered.
The Company generates revenues from four business segments: Company Stores, Domestic Franchise,
International Franchise and KK Supply Chain. The revenues and operating income of each of these segments for
each of the three most recent fiscal years is set forth in Note 2 to the Companys consolidated financial statements
appearing elsewhereherein.
Company Stores. The Company Stores segment is comprised of the doughnut shops operated by the
Company. These shops sell doughnuts and complementary products through the on-premises and wholesale
channels and come in two formats: factory stores and satellite shops. Factory stores have a doughnut-making
production line, and many of them sell products through both on-premises and wholesale channels to more fully
utilize production capacity. Factory stores also include commissaries which serve only wholesale customers.
Satellite shops, which serve only on-premises customers, are smaller than most factory stores, and include the hot
shop and fresh shop formats. As of February 3, 2013, there were 97 Company shops in 19 states and the District of
Columbia, including 76 factory and 21 satelliteshops.
Domestic Franchise. The Domestic Franchise segment consists of the Companys domestic store
franchise operations. Domestic franchise stores sell doughnuts and complementary products through the
on-premises and wholesale channels in the same way and using the same store formats as do Company stores.
As of February 3, 2013, there were 142 domestic franchise stores in 29 states, consisting of 99 factory and 43
satellitestores.
International Franchise. The International Franchise segment consists of the Companys international
store franchise operations. International franchise stores sell doughnuts and complementary products almost
exclusively through the on-premises sales channel using shop formats similar to those used in the United States,
and also using a kiosk format. A portion of sales by the franchisees in Canada, the United Kingdom and Australia
are made to wholesale customers. As of February 3, 2013, there were 509 international franchise shops in
21countries, consisting of 120 factory stores and 389 satelliteshops.
KK Supply Chain. The KK Supply Chain segment produces doughnut mixes and manufactures doughnutmaking equipment, which all factory stores, both Company and franchise, are required to purchase. In addition,
KK Supply Chain sells other ingredients, packaging and supplies, principally to Company-owned and domestic
franchisestores.
As of February 3, 2013, there were 239 Krispy Kreme stores operated domestically in 38 states and in the
District of Columbia, and there were 509 shops in 21 other countries around the world. Of the 748 total stores,
295were factory stores and 453 were satellites. The ownership and location of those stores is asfollows:
Company stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Franchise stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Domestic
International
97
142
239
509
509
Total
97
651
748

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 3

OPERATOR PM10
The Company and its franchisees sell products through twochannels:

On-premises: Sales to customers visiting Company and franchise factory and satellite stores, including
sales made through drive-thru windows, along with discounted sales to community organizations that in
turn sell doughnuts for fundraising purposes. A substantial majority of the doughnuts sold in our shops are
consumedelsewhere.

Wholesale: Sales of fresh doughnuts and packaged sweets primarily on a branded basis to a variety of
retail customers, including convenience stores, grocery stores/mass merchants and other food service and
institutional accounts. These customers display and resell the doughnuts and other products from selfservice display cases, and in packages merchandised on stand-alone display units. Products are delivered
to customer locations by our fleet of delivery trucks operated by a commissioned employee sales force.
Distribution through wholesale sales channels generally is limited to stores in the United States. As noted
above, only a small minority of sales by international franchisees are made to wholesalecustomers.
Company History
In 1933, Vernon Carver Rudolph, the founder of Krispy Kreme, went to work for his uncle, who had acquired
a doughnut shop in Paducah, Kentucky from a French chef originally from New Orleans, which included, among
other items, the rights to a secret yeast-raised doughnut recipe. In the mid 1930s, they decided to look for a larger
market, and moved their operations to Nashville, Tennessee. Shortly thereafter, Mr. Rudolph acquired the business,
together with his father and brother, and they soon opened shops in Charleston, West Virginia and Atlanta,
Georgia. At this time, the business focused on selling doughnuts to local grocerystores.
During the early summer of 1937, Mr. Rudolph decided to leave Nashville to open his own doughnut shop.
Along with two friends, he set off in a 1936 Pontiac and arrived in Winston-Salem, North Carolina with $25 in
cash, a few pieces of doughnut-making equipment, the secret recipe, and the name Krispy Kreme Doughnuts.
They used their last $25 to rent a building across from Salem Academy and College in what is now called historic
OldSalem.
On July 13, 1937, the first Krispy Kreme doughnuts were made at the new Winston-Salem shop, with
the first batch of ingredients purchased on credit. Mr. Rudolph was 21 years of age. Soon afterward, people
began stopping by to ask if they could buy hot doughnuts right there on the spot. The demand was so great that
Mr. Rudolph opened the shop for retail business by cutting a hole in the wall and selling doughnuts directly to
customers, marking the beginning of Krispy Kremes restaurantbusiness.
In 1939, Mr. Rudolph registered the trademark Krispy Kreme with the United States Patent and Trademark
Office. The business grew rapidly and the number of shops grew, opened first by family members and later
bylicensees.
In the 1950s and 1960s, steps were taken to mechanize the doughnut-making process. Proofing, cooking,
glazing, screen loading and cutting became entirely automatic. Most of these doughnut-making processes are still
used by Krispy Kreme stores today, although they have been furthermodernized.
Following Mr. Rudolphs death, in May 1976 Krispy Kreme became a wholly-owned subsidiary of Beatrice
Foods Company of Chicago, Illinois. In February 1982, a group of Krispy Kreme franchisees purchased Krispy
Kreme from BeatriceFoods.
With new leadership, a renewed focus on the hot doughnut experience became a priority for the Company
and led to the birth of the Doughnut Theater , in which the doughnut-making production line is visible to
consumers, creating a multi-sensory experience unique to Krispy Kreme that is an important distinguishing
feature of our brand. The Company began to expand outside of the Southeast and opened a store in New York
City in 1996. Soon afterward, in 1999, the Company opened its first store in California and began its national
expansion. In April 2000, Krispy Kreme held an initial public offering of common stock, and in December 2001,
the Company opened its first international store, in Canada, and began its internationalexpansion.

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 4

OPERATOR PM10
When the Company turned 60 years old in 1997, Krispy Kremes place as a 20th century American icon
was recognized by the induction of Company artifacts into the Smithsonian Institutions National Museum of
AmericanHistory.
The last decade of the 20th century and the early years of the 21st was a period of rapid growth in the
number of stores and domestic geographic reach of Krispy Kreme, particularly following the April 2000 initial
public offering. In many instances, the Company took minority ownership positions in new franchisees, both
domestic and international. Enthusiasm for the brand generated very high average unit sales volumes as Krispy
Kreme stores expanded into new geographic territories, and the Company generated significant earnings driven
by the domestic store expansion. The initial success of a number of franchisees led the Company to reacquire
several franchise markets in the United States in 2003 and early 2004, often at substantial premiums. By late
2003, average unit volumes began to fall as initial sales levels in many new stores proved to be unsustainable,
which adversely affected earnings of both the Company and franchisees. This led to a period of retrenchment
characterized by over 240 domestic store closings from 2004 through 2009. The Companys revenues fell
significantly during this period, principally as a result of store closings by the Company and by franchisees.
The Company incurred significant losses, including almost $300million in impairment charges and lease
termination costs during this period related principally to store closings and to the writeoff of goodwill from the
franchiseacquisitions.
While the domestic business was going through a period of retrenchment, the Company greatly increased
its international development efforts. Those efforts, which are continuing, have resulted in the recruitment of new
franchisees in 17 countries since the end of fiscal 2004, and those franchisees, together with existing franchisees
in four other countries, have opened a cumulative net total of 488 Krispy Kreme stores during that time. As of
February 3, 2013, of the 748 Krispy Kreme stores worldwide, 509 are operated by franchisees outside the United
States. Many of those franchisees pioneered the development of small Krispy Kreme satellite shop formats which,
in tandem with a new small factory store model recently developed by the Company, serve as the prototype for the
small shop business model the Company currently is developing to serve domestic markets and accelerate growth
in the UnitedStates.
Growth returned to the domestic Krispy Kreme system in fiscal 2011, when the number of shops increased
for the first time since fiscal 2005, and that growth has continued through fiscal2013.
Today, Krispy Kreme enjoys over 65% unaided brand awareness, and our Hot Krispy Kreme Original
Glazed Now sign is an integral contributor to the brands mystique. In addition, the Doughnut Theater in factory
stores provides a multi-sensory introduction to the brand and reinforces the unique Krispy Kreme experience in
22countries around theworld.
Industry Overview
Krispy Kreme operates within the quick service restaurant, or QSR, segment of the restaurant industry,
although our consumer research indicated domestic customers think of our shops more like bakeries than
restaurants. In our Company shops, approximately 55% of retail transactions include one or more dozens of
doughnuts, and the vast majority of products we sell in our shops are consumed elsewhere. In the United States,
the QSR segment is the largest segment of the restaurant industry and has demonstrated steady growth over a long
period oftime.
We believe that the QSR segment is generally less vulnerable to economic downturns than the casual dining
segment, due to the value that QSRs deliver to consumers, as well as some trading to value by consumers from
other restaurant industry segments during adverse economic conditions, as they seek to preserve the away from
home dining experience on tighter budgets. However, high unemployment, low consumer confidence, tightened
credit and other factors have taken their toll on consumers and their ability to increase spending, resulting in fewer
visits to restaurants and related dollar growth. As a result, QSR sales may continue to be adversely impacted by
the weak economic environment or by sharp increases in commodity or energy prices. The Company believes
increased prices of agricultural products and energy are more likely to significantly affect its business than are
economic conditions generally, because the Company believes its products are affordable indulgences that appeal
to consumers in all economicenvironments.
4
REVISION 4
JOB NUMBER 246088
TYPE Clean
SERIAL <12345678>
PAGE NO. 5

OPERATOR PM10
In both domestic and international markets, we compete against a broad array of national, regional and local
retailers of doughnuts and treats, some of which have substantially greater financial resources than we do and
are expanding to other geographic regions, including areas where we have a significant store presence. We also
compete against other retailers who sell sweet treats such as cookie, cupcake and ice cream stores. We compete on
elements such as food quality, convenience, location, customer service andvalue.
In addition to retail doughnut outlets, the domestic doughnut market is comprised of several other sales
channels, including grocery store packaged products, in-store bakeries within grocery stores, convenience stores,
foodservice and institutional accounts, and vending. Our wholesale competitors include makers of doughnuts
and snacks sold through all of these wholesale channels. Customer service, including frequency of deliveries and
maintenance of fully stocked shelves, is an important factor in successfully competing for convenience store and
grocery/mass merchant business. There is an industry trend moving towards expanded fresh product offerings
at convenience stores during morning and evening drive times, and products are either sourced from a central
commissary or brought in by local bakeries. In the packaged doughnut market, we compete for sales with many
sweet treats, including those made by well-known producers, such as Dolly Madison, Entenmanns, Little Debbie
and Sara Lee, as well as regionalbrands.
Comprehensive, reliable doughnut industry statistics are not readily available; however, with regard to
specific sales channels within the industry, data are available. Industry data indicate that, during calendar 2012,
doughnut industry sales rose approximately 5% year-over-year in grocery stores and rose approximately 4% in
conveniencestores.
Krispy Kreme Brand Elements
Krispy Kreme has several important brand elements we believe have created a bond between our brand and
our team members, guests, consumers and their communities. The key elementsinclude:
ne-of-a-kind taste. The taste experience of our doughnuts is the foundation of our concept and the
O
common thread that binds generations of our loyal customers. Our doughnuts are made based on a secret
recipe that has been in our Company since 1937. We use premium ingredients, which are blended by our
proprietary processing equipment in accordance with our standard operating procedures, to create this
unique and very special product. Our research indicates this one-of-a-kind taste drives guests cravings for
ourproducts.
oughnut Theater. Our factory stores typically showcase our Doughnut Theater, which is designed
D
to produce a multi-sensory customer experience and establish a brand identity. Our goal is to provide our
customers with an entertainment experience and to reinforce our commitment to quality and freshness by
allowing them to see the doughnuts beingmade.
ot Krispy Kreme Original Glazed Now sign. The Hot Krispy Kreme Original Glazed Now sign,
H
when illuminated, is a signal that our hot Original Glazed doughnuts are being served. The Hot Krispy
Kreme Original Glazed Now sign is an impulse purchase generator and an integral contributor to our
brand. In fiscal 2012, we introduced the Krispy Kreme Hot Light app for smartphones and desktops that
automatically notifies guests when the Hot Krispy Kreme Original Glazed Now sign is illuminated at either
their favorite or the nearest Krispy Kreme shop. The app also allows users to get directions to Krispy Kreme
locations and find out important information regarding currentpromotions.
ur Original Glazed doughnuts are made for several hours every morning and evening, and at other times
O
during the day at our factory stores. We also operate hot shops, which are satellite locations supplied with
unglazed doughnuts from a nearby factory store or commissary. Hot shops use tunnel ovens to heat unglazed
doughnuts throughout the day, which are then finished using the same glaze waterfall process used at
factoryshops.
haring and Connection. Krispy Kreme doughnuts are a popular choice for sharing with friends, family,
S
co-workers and fellow students. Consumer research shows that approximately 70% of purchases at our
domestic shops are for sharing occasions; and in Company shops, approximately 55% of retail transactions
5

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 6

OPERATOR PM10
are for sales of one or more dozen doughnuts. The strength of our brand in shared-use occasions transcends
international borders. Sales of dozens comprise a significant portion of shop sales transactions around the
world, and the sharing concept is an integral part of our global marketingapproach.
ommunity relationships. Krispy Kreme was built upon generations of word-of-mouth marketing. We
C
are committed to building relationships with our team members, guests and in our communities. Our shop
operators support their local communities through fundraising programs and sponsorship of charitable
events. Many of our loyal customers have memories of selling Krispy Kreme doughnuts to raise money
for their schools, clubs and community organizations. We refer to these activities as local relationship
marketing; it is the core building block of Krispy Kreme marketing and directly connects our marketing
efforts to our brands mission of touching and enhancing lives through the joy that is KrispyKreme.
eritage. For the past 76 years, Krispy Kreme has been known for producing one-of-a-kind doughnuts.
H
Our consumer research indicates this heritage and consistency are important parts of the brands imagery
with our guests. Icons of Krispy Kremes heritage include paper hats, historical road signs and our
bowtielogo.
Strategic Initiatives
We have developed a number of strategic initiatives designed to foster the Companys growth and improve its
profitability. The major initiatives to which we are devoting our efforts are discussedbelow.
Developing and Testing Domestic Small Shop Formats To Drive Sales and Profitability
We are working to refine our domestic store operating model to focus on small retail shops, including both
satellite shops to which we supply doughnuts from a nearby factory store in a hub and spoke distribution model,
and shops that manufacture doughnuts but which have a smaller footprint and have less production capacity than
traditional factory stores. The objectives of the small retail shop model are, among otherthings:

to stimulate an increase in on-premises sales of doughnuts and complementary products by increasing the
number of Krispy Kreme shops to provide customers more convenient access to ourproducts;

to reduce the investment required to produce a given level of sales and reduce operating costs by operating
factory stores that are smaller than our traditional factory shops, as well as satellite shops supplied by
larger, more expensive traditional factorystores;

to increase the number of markets which can support a factory store through the continuing development of
smaller factory storemodels;

to achieve greater production efficiencies in certain markets by centralizing doughnut production to
minimize the burden of fixed costs; and

to enable store team members to focus on achieving excellence in customer satisfaction and in-shop
consumerexperience.
We intend to focus development of Company shops in the southeast in order to achieve economies of scale
and minimize the geographic span of our Company store operations, and to develop the other domestic markets
through franchising. We view successful development and demonstration of the small shop economic model,
including both smaller footprint factory stores and satellite shops served through the hub and spoke model, as
critical to attracting ongoing franchisee investment in the United States. Most of our international franchisees
utilize hub and spoke models, and there currently are 389 satellite locations in operation in 18 foreign countries,
which represent approximately 75% of all international franchiseshops.
Market research has guided our shop development in the southeast over the past four years, resulting in
new shop construction in the Piedmont Triad, Charlotte and Raleigh, North Carolina; Columbia and Greenville,
South Carolina; Louisville, Kentucky; Nashville, Tennessee and Norfolk/Virginia Beach, Virginia. Prior to fiscal
2013, most of these shops were hot shop satellites in end-cap locations, all but one with a drive-thru window, with
doughnuts supplied twice daily by nearby traditional factory shops using our hub and spoke distributionsystem.
6

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 7

OPERATOR PM10
We opened four new small shops in fiscal 2013, all of which were factory shops smaller than our traditional
factory stores. Two of these shops were end-cap spaces in multi-tenant buildings and two were free-standing
factory shops, one of which was a second-generation site. The average size is approximately 2,600 square feet, and
each is equipped with a drive-thru window. In fiscal 2014, we plan to open as many as ten new Company shops,
substantially all of which are expected to be new, free-standing, small format factory shops of approximately 2,300
square feet, each with a drive-thru window. The size of these new shops is expected to be substantially smaller
than that of our traditional factory shops, which typically range in size from 2,800 to 5,500 square feet, and which
often serve both retail and wholesale customers. Unlike our traditional factory shops, these new small shops serve
retail customers only, and do not engage in wholesaledistribution.
Our ongoing shop development will continue to focus on the southeast, including, in the near term,
Charlotte and Burlington, North Carolina; Knoxville, Tennessee; Jacksonville, Florida; Richmond, Virginia; and
Atlanta,Georgia.
We chose these markets as our initial focus of small shop development because they are markets in which
we have an existing base of Krispy Kreme factory shops from which to build. In many of the markets in which
we plan to develop additional Company shops, we expect to build small factory shops as well as satellite shops
supplied using the hub and spoke model. Moreover, successful development of small factory shop economic
models, could allow us to locate shops in smaller population towns and areas than has traditionally been possible,
which could significantly increase the potential number of Company and franchise stores nationwide. Our goal
is to develop a suite of shop designs of varying sizes and production capacities to enable us to develop markets of
various sizes and populationdensities.
Enhancing Our Focus on Shop Operations
In recent years, we have been working to improve our shop operating margins by improving our operating
methods; creating and deploying management tools, including labor cost and food cost management tools;
enhancing our hospitality, service and cleanliness standards; and continuously training our people on new
methods and standards. We believe we have opportunities to continue to improve our shop operating methods
and procedures. Our goal is to drive same store sales and operate our shops more efficiently through a focus
on operating excellence and world class guest experience. We evaluate guest experiences using several tools,
including regular mystery shops, external brand perception research and direct consumer response measurements.
These allow us to track guest experiences compared to perceptions and expectations, identify competitive
strengths, and track our progress on a shop-by-shopbasis.
Over half of our Company shops revenues are derived from sales to grocers, mass merchants, convenience
stores and other wholesale customers. We believe we have less ability to recover higher costs of agricultural
commodities in the wholesale channel than we do in the on-premises channel, and we have the additional cost
pressures associated with generally rising fuel costs and substantial product returns stemming from the relatively
short shelf-life of our signature yeast-raised doughnut. Nevertheless, we believe the Krispy Kreme brand should
be represented in wholesale distribution channels. Over time, we expect our wholesale product line to become
increasingly differentiated from the products offered in our shops in order to improve the economics of this
distribution channel. We are focusing customer development efforts on retailers we believe will generate weekly
sales per door significantly greater than our systemwide average. In addition, we are focusing on enhancing
our product line to increase consumer value by offering a variety of products with longer shelf-lives, as well as
modernizing our delivery fleet, rationalizing delivery routes, improving our packaging designs and enhancing
customer service to improve the profitability of wholesaledistribution.
Driving Revenues By Enhancing Beverage Offerings and Deploying New Products
Sales of doughnuts comprise approximately 88% of our retail sales. In addition to improving consumer
convenience by expanding the number of Krispy Kreme shops and points of distribution in our markets, we plan
to continue development and deployment of a brand-relevant range of menu offerings to give consumers more
reasons to visit Krispy Kreme shops more often and to improve our sales. These include limited time offerings,
leveraged doughnut varieties, enhanced beverage offerings and other products that are complementary to the
7

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 8

OPERATOR PM10
Krispy Kreme brand and experience. While we have the option to enhance Krispy Kremes menu options beyond
doughnuts, our consumer research indicates there is substantial untapped consumer demand for more doughnuts.
Our short-term menu plans will focus on maximizing doughnut sales with existing and new doughnut varieties
across more dayparts and useoccasions.
Throughout the world, we continue to work with our franchisees to broaden their menu offerings and
offer exciting, new products within our existing platforms. New product innovation is a key part of our global
marketing strategy. Our team strives to enhance our product offerings by introducing new beverages, doughnuts
and complementary items that take advantage of global, regional and local taste trends. Our beverage offerings
in most international markets include a broad range of hot and iced espresso drinks, teas, chocolate drinks, and
our frozen Krispy Kreme Chillers line localized to meet important customer taste profiles. Our Krispy Kreme
Baked Creations line of baked goods, now available in the Philippines, Korea, Indonesia, Saudi Arabia and
Turkey, complements our signature doughnuts and beverages and provides our customers with a range of products
that meet additional day part needs. Importantly, we continue to focus on innovation within our core range of
doughnuts and have recently introduced innovations internationally such as chocolate glaze and chocolate dough,
whole wheat dough, minis, doughnut holes and new doughnut varieties leveraging co-promotional relationships
with international chocolate brands, movies and brandedtoys.
Investing for Growth in the Domestic Franchise System
In fiscal 2013, we continued our preparations to re-engage in marketing Krispy Kreme franchises
domestically, including committing additional resources to domestic franchise recruitment. Late in the year, we
hired a Vice President of Domestic Franchise Development, a new role designed to lead our U.S. expansion efforts.
This officer will focus on recruiting, selecting and developing new domesticfranchisees.
We believe developing the small factory shop model, together with the satellite shop concepts developed in
recent years, is critical to accelerating domestic franchise growth. See Developing and Testing Domestic Small
Shop Formats To Drive Sales and Profitability, above. It is our goal to increase the total domestic store count, both
Company and franchise, to 400 shops by January2017.
Building On Our Success Internationally
Our international franchisees expansion in recent years has been outstanding, with international stores
growing from 123 to 509 and from 31% of our total store count to 68% since fiscal 2007. We have been devoting
additional resources, principally people, to supporting the growth of our international franchisees, and we expect
to devote even more resources to supporting international franchisees in fiscal 2014. Krispy Kreme is now
represented in 21 countries outside the United States, and we believe the international growth potential in the
coming years is substantial. It is our goal to increase the number of international shops to 900 by January2017.
Enhancing Franchisee Support
We are committed to devoting additional resources and providing an even higher level of support to both our
domestic and international franchisees. Staffing is expected to increase in both the Domestic and International
Franchise segments, as well as in the Supply Chain, to support franchise operations. New and refined management
tools have been developed, tested and deployed in both franchise segments, including operations and training
manuals; individual training manuals for specific positions within our shops, such as retail, processing, production
and shift management; brand standards manuals; food and labor cost management tools; loss prevention tools;
and shop design manuals. Krispy Kreme University, our training operation, is available to franchisee assistant
managers and general managers, and our International Franchise personnel also provide training to franchisees
around theworld.

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 9

OPERATOR PM10
Continuing to Invest in Research and Development

In recent years, we have devoted resources to research and development to improve our products and
our doughnut production methods and equipment, and we expect to increase our commitment to research and
development in coming years. Our objective is to improve the shelf life of our products, particularly our yeastraised doughnuts, in order to improve the consumer experience with products purchased in the wholesale
distribution channel. We also seek to reduce our returns of unsold products; to enhance automation of our
doughnut production processes to make it simpler to execute and to achieve greater product consistency and reduce
costs; to reduce the size of our doughnut making equipment to enable construction of factory stores in smaller
retail spaces to improve shop economics; and to improve the efficiency of our production process and reduce
ingredientcosts.
Increasing Our Investments in Technology
We are increasing our investments in technology to support our business. In fiscal 2012, we purchased new
point-of-sale hardware for all our Company shops and established a new standard hardware configuration for
Company and domestic franchisee locations. In fiscal 2013, we tested new front-of-house and back-of-house pointof-sale (POS) software to more effectively support our business through improved cash controls, enhanced sales
visibility and centralized data management. In early fiscal 2014, we began deployment of the new POS software to
Company shops, and expect to complete that deployment, together with deployment to certain domestic franchise
shops, in fiscal 2014. In fiscal 2015, we plan on leveraging the new software to launch a domestic systemwide
loyalty program, improve inventory management and centralize national promotions for Company and domestic
franchiseelocations.
In fiscal 2012, we began deployment of new handheld software and devices to support the commissioned
sales force serving our wholesale customers, and substantially completed that deployment in fiscal 2013. Prior to
fiscal 2012, only about one-third of our wholesale routes utilized handheld technology. Among the improvements
we expect to achieve, over time, from this new technology are the elimination of substantially all paper from
the customer delivery documentation process; further reduction of paper invoicing; a reduction in the amount of
time spent in customer aisles performing administrative delivery tasks; elimination of back-of-house data keying;
adding GPS functionality for route optimization and monitoring; and improved sales management tools to reduce
product returns while maintaining or increasing salesvolume.
Over the next few years, we also plan substantial new investments in other technologies to support our
business, including selection and implementation of a new enterprise resource planning system, design and
deployment of new production planning and cost systems, and development of improved business intelligence
systems to support decision-making throughout theorganization.
Company Stores Business Segment
Our Company Stores segment is comprised of the operations of our Company-owned stores. These
stores sell doughnuts and complementary products through the on-premises and wholesale channels described
above under Company Overview. Expenses for this business segment include cost of goods sold, store level
operating expenses along with direct general and administrative expenses, certain marketing costs and allocated
corporatecosts.
Products
Doughnuts and Related Products. We currently make and sell a wide variety of high-quality doughnuts,
including our signature Original Glazed doughnut. Our shops typically offer 16 or more doughnut varieties,
including eight varieties that are offered at all our Krispy Kreme shops and up to four limited item doughnut
offerings, with the balance of the assortment selected by the shop manager from our more than 12 other standard
doughnut varieties. Most of our doughnuts, including our Original Glazed doughnut, are yeast-raised doughnuts,
although we also offer several varieties of cake doughnuts and crullers. We have become known for seasonal
doughnuts that come in a variety of non-traditional shapes, including hearts, pumpkins, footballs, eggs and
9

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 10

OPERATOR PM10
snowmen, and which often feature complementary icings and fillings. We also offer other doughnut varieties on
a limited time basis to provide interest to our guests and excitement to our team members. Generally, products for
domestic stores are first tested in our Company stores and then rolled out to our franchise stores, although we have
approved for testing at franchise locations new products which we believe are compatible with our brand image
and which meet our demanding quality standards. Sales of doughnuts comprise approximately 88% of total retail
sales, with the balance comprised principally of beveragesales.
Many of the doughnut varieties we offer in our doughnut shops are also distributed through wholesale
channels. In addition, we offer a number of products exclusively through wholesale channels, including honeybuns,
fruit pies, mini-crullers and chocolate products, generally packaged as individually wrapped snacks or packaged in
snack bags. We also have introduced products in non-traditional packaging for distribution through grocery stores,
mass merchants and convenience stores. Sales of yeast-raised doughnuts comprise approximately 80% of total
wholesale sales, with cake doughnuts and all other product offerings as a group each comprising approximately
10% of total wholesalesales.
The cost of doughnut mixes, shortening, sugar and packaging are the four most significant component costs
of our doughnut products, comprising approximately 16%, 7%, 8% and 10%, respectively, of Company Stores cost
of sales, respectively, in fiscal2013.
Complementary products. We continue to develop and leverage complementary products to meet
consumer needs for convenience, regional taste preference and variety. Beverages play a large role in providing
convenience and satisfaction for our guests, including coffee, which has been part of the brand for many decades.
We have a complete beverage program which includes drip coffees, iced coffees, both coffee-based and noncoffee-based frozen drinks, juices, sodas, milks, water, frozen/blended beverages and packaged and fountain
beverages. We are continuing to refine our beverage offerings, including specialty espresso, cappuccino and hot
chocolate drinks, and rolled out three new drip coffee blends in fiscal 2012. Many markets and shops introduced
new espresso beverages in fiscal 2013, and promotional activities include beverage and doughnut combos
whenappropriate.
Traditional Factory Store Format
Historically, the Krispy Kreme business has been centered around large facilities which operated both as
quick service restaurants and as consumer packaged goods distributors, with doughnut-making production lines
located in each shop which served both the on-premises and wholesale distribution channels. The operation of
these traditional factory stores tends to be complex, and their relatively high initial cost and their location in retailoriented real estate results in a relatively high level of fixed costs which, in turn, results in high breakevenpoints.
Traditional factory stores generally are located in freestanding suburban locations generally ranging in size
from approximately 2,800 to 5,500 square feet, and typically have the equipment which can produce from 150
to 230 dozen doughnuts per hour. The relatively larger factory stores often sell doughnuts and complementary
products to both on-premises and wholesale customers, with the allocation between such channels dependent on
the stores capacities and the characteristics of the markets in which the stores operate; some of these shops have
equipment that can produce 600 dozen doughnuts per hour or more than one production line. Relatively smaller
traditional factory stores, which typically have less production capacity, serve only on-premisescustomers.
When the production line is producing our Original Glazed doughnut, we illuminate our Hot Krispy Kreme
Original Glazed Now sign, which is a signal that our hot Original Glazed doughnuts are being served. Our high
volume dayparts are mornings and early evenings. The breakdown of our sales by daypart is approximately as
follows (hours between 11:00 p.m. and 6:00 a.m. have been omitted because very few of our shops are open to the
public during thesehours):
Hours
6 a.m.
11 a.m.
2 p.m.
6 p.m.
Percentage of Retail Sales
11 a.m.
2 p.m.
6 p.m.
11 p.m.
36%
12%
20%
28%
10

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 11

OPERATOR PM10
The factory store category also includes seven commissaries, five of which have multiple production
lines. These facilities often have equipment capable of producing 600 or 1,000 dozen doughnuts per hour, and
sometimes have more than one production line. The commissaries typically serve wholesale customers exclusively,
although some commissaries produce certain products (typically longer shelf-life products such as honeybuns)
that are shipped to other factory stores where they are distributed to wholesale customers together with products
manufactured at the receiving shop. One of our commissaries also serves as a hub location, producing doughnuts
that are delivered to nearby satelliteshops.
Historically, the relatively large size and high cost of traditional factory stores limited the density of our
stores in many markets, causing many of our consumers to utilize them as destination locations, which limited
their frequency of use. In addition, each factory store has significant fixed or semi-fixed costs, and margins and
profitability are significantly affected by doughnut production and sales volume. Some of our traditional factory
stores and commissaries have more capacity to produce doughnuts than is currently is beingutilized.
Small Shop Formats
In recent years, we have been developing several new small domestic shop formats to serve on-premises
customers exclusively, with the goal of permitting us to operate a larger number of stores that are more convenient
to our customers, reducing the initial shop investment, reducing our per store fixed costs and lowering breakeven
points, and, in certain markets, leveraging the production capacity in the existing installed base of traditional
factory stores. Our international franchisees pioneered the development of the small shop formats, which include
small factory stores that operate independently, as well as satellite stores, which are located in proximity to
existing traditional factory stores which supply finished and unglazed doughnuts to the satellites using a hub
and spoke distribution system. Most of our international franchisees use a hub and spoke distribution model;
approximately 75% of Krispy Kreme shops outside the United States are satellite shops, with the fresh shop being
the predominantformat.
Our consumer research indicates that the typical Krispy Kreme on-premises customer visits Krispy Kreme
an average of once a month, and a significant obstacle to more frequent customer visits is our relative lack of
convenience. Our consumer demographics are very much in line with the general population in which we do
business. Our consumer research also indicates that consumers give us permission to leverage our brand into a
variety of complementary products, so long as the quality of those products is consistent with the very high quality
perception consumers attribute to our Original Glazed doughnut.
Small Factory Stores. We have developed a domestic small retail-only factory store which occupies
approximately 2,300 square feet and which contains a full doughnut production line, but on a smaller scale than
the production equipment in a traditional factory store. We operate six of these small factory stores, and view the
small factory format as a more cost-effective means to offer the Krispy Kreme experience to consumers than our
traditional large factory stores. Due to their lower cost, these small format factory shops could enable us to deliver
the Krispy Kreme Doughnut Theater experience to consumers in relatively smaller geographic markets than we
currently serve because the small shops typically have lower breakeven points than our large traditionalshops.
Our small factory stores generally have the capacity to produce between 65 and 110 dozen doughnuts per
hour, depending on the equipment configuration. Our larger traditional shops typically have equipment capable
of producing in the range of 150 to 600 dozen doughnuts an hour. We currently operate six small factory shops,
four of which were opened in fiscal 2013. Four of the six small factory shops are end-cap locations and two are
freestanding buildings, both of which opened in fiscal 2013. All six shops have drive-thru windows. The average
capital investment in the two end-cap locations opened in fiscal 2013 was approximately $680,000, including
the doughnut-making equipment, signage, other equipment and furnishings, and tenant upfit from a heated and
cooled shell. One of the two free-standing shops was a second-generation site which the Company leased and then
refurbished the existing building. The other free-standing shop was a first-generation site on which the landlord
constructed and upfit a building and then leased the land and building to the Company. The Companys capital
investment in these two free-standing shops was approximately $1.0million and $495,000, respectively, which
included the cost of the doughnut-making equipment, signage, other equipment and furnishings and, in the case
11

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 12

OPERATOR PM10
of the second-generation site, included the cost of refurbishing the building. The lease for the first generation site
developed by the landlord was recorded as a capital lease in the amount of $455,000, but is not included in the
$495,000 Company-funded investment amount above. We plan to continue refining the small factory model to
further reduce the initial capital cost of thisformat.
We expect to open a minimum of seven to ten new Company small factory shops in each of the next two
fiscal years, most of which we expect to be free-standing. While the cost of a free-standing shop is expected to be
greater than a similar shop in an end-cap space in a multi-tenant building, we believe that the anticipated higher
average weekly sales volume from the free-standing shop will more than offset the higher initialinvestment.
Outside the United States, small factory stores are more numerous than larger traditional factory stores.
Because many international factory stores are located in urban areas where lease rates are relatively high, these
shops tend to be smaller than domestic factory stores. In addition, because international factory shops generally
serve only on-premises customers, the space required to support wholesale distribution is notrequired.
Satellite Stores. In addition, we have developed two varieties of domestic satellite stores. These shops
serve only on-premises customers, are smaller than traditional factory stores, and do not contain a doughnut
making production line. Satellite stores consist of the hot shop and fresh shop formats, and typically range in
size from approximately 1,800 to 2,400 square feet (exclusive of larger factory stores that have been converted to
satellites). In each of these formats, the Company sells doughnuts, beverages and complementary products, with
the doughnuts supplied by a nearby traditional factory store or acommissary.
Hot shops utilize tunnel oven doughnut heating and finishing equipment to offer customers our hot Original
Glazed doughnuts throughout the day. This equipment heats unglazed doughnuts and finishes them using a warm
glaze waterfall that is the same as that used in a traditional factory store. Hot shops signal customers that our
signature product is available using the Hot Krispy Kreme Original Glazed Now illuminated sign. Products other
than our Original Glazed doughnut generally are delivered at least twice daily to the hot shop already finished,
although in some locations we perform some finishing functions at the hot shop, including application of icings
and fillings, to provide consumers with elements of our Doughnut Theater experience in hot shoplocations.
Fresh shops are similar to hot shops, but do not contain doughnut heating and finishing equipment.
Doughnuts sold at fresh shops often are delivered fully finished from the factory hub, but in some locations
fresh shops decorate and finish doughnuts in the shop in order to provide an element of consumer interest and to
emphasize the freshness of our products. The fresh shop format is the predominant satellite format used by our
international franchisees, comprising approximately 66% of all international satelliteshops.
Hot shops and fresh shops typically are located in shopping centers, and end cap spaces that can
accommodate drive-thru windows are particularly desirable. We view the hot shop and fresh shop formats as ways
to achieve market penetration and greater consumer convenience in a variety of market sizes and settings. Our
international franchisees led the initial development of the satellite shop formats, and we have been working to
adapt their work to the domesticmarket.
The ability to accommodate a drive-thru window is an important characteristic in most new shop locations,
including both factory stores and satellite shops. Of our 90 shops which serve on-premises customers, 84 have
drive-thrus, and drive-thru sales comprise approximately 46% of these shops retail sales. At some of the shops
which produce doughnuts 24 hours per day, we are experimenting with continuous drive-thruoperation.
12

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 13

OPERATOR PM10
The following table sets forth the type and locations of Company stores as of February 3,2013.
Number of Company Stores
Factory
Hot
Fresh
Stores
Shops
Shops
Total
State
Alabama. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
District of Columbia. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Florida. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Georgia. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Indiana . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Kansas. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Kentucky. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Louisiana. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Maryland. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Michigan. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Mississippi . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Missouri . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
New York . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
North Carolina . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ohio. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
South Carolina . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Tennessee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Texas. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Virginia. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
West Virginia. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4
7
3
3
3
1
2
3
1
3
13
6
5
9
3
6
1
76
5
1
3
3
20
3
1
4
12
4
3
4
1
2
3
1
3
1
17
6
8
12
3
8
1
97
Changes in the number of Company stores during the past three fiscal years are summarized in the tablebelow.
Number of Company Stores
Factory
Hot
Fresh
Stores
Shops
Shops
Total
JANUARY31,2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Opened. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Closed. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Change in store type. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
JANUARY30,2011. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Opened. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Closed. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Change in store type. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
JANUARY29,2012. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Opened. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Closed. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Transferred from Domestic Franchise. . . . . . . . . . . . . . . . . . . . . . . .
FEBRUARY3,2013. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
69
69
2
1
72
4
(1)
1
76
12
3
(1)
1
15
5
(1)
19
1
20
2
1
(1)
(1)
1
83
4
(2)
85
7
92
4
(1)
2
97
Wholesale Distribution
Sales to wholesale customers accounted for over half of fiscal 2013 revenues in the Company Stores segment.
Of the 97 stores operated by the Company as of February 3, 2013, 43 serve the wholesale distribution channel,
including seven commissaries. We sell our traditional yeast-raised and cake doughnuts in a variety of packages,
generally containing from six to 15 doughnuts. In addition, we offer in the wholesale distribution channel a
number of doughnuts and complementary products that we do not offer in our shops, including honeybuns,
13

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 14

OPERATOR PM10
mini-crullers, fruit pies and a variety of snack doughnuts. These products typically have longer shelf lives than
our traditional doughnuts and are packaged in snack bags or as individually wrapped snacks. Packaged products
generally are marketed from Krispy Kreme branded displays. In addition to packaged products, we sell individual
loose doughnuts through our in-store bakery (ISB) program, using branded self-service display cases that also
contain branded packaging for loose doughnutsales.
The wholesale distribution channel is composed of two principal customer groups: grocers/mass merchants
and convenience stores. Substantially all sales to grocers and mass merchants consist of packaged products, while
a significant majority of sales to convenience stores consists of loose doughnuts sold through the ISBprogram.
We deliver doughnuts to wholesale customers using a fleet of delivery trucks operated by a commissioned
employee sales force. We deliver products to packaged doughnut customers three or more times per week,
generally on either a Monday/Wednesday/Friday or Tuesday/Thursday/Saturday schedule. ISB customers generally
are serviced daily, six times per week. In addition to delivering product, our salespeople are responsible for
merchandising our products in the displays and picking up unsold products for return to the Company shop. Our
principal products are yeast-raised doughnuts having a short shelf-life, which results in unsold product costs in the
wholesale distribution channel, most of which are absorbed by theCompany.
The wholesale channel is highly competitive, and the Company has not increased selling prices in recent
years sufficiently to recover increased costs, particularly higher costs resulting from rising agricultural commodity
costs and higher fuel costs. In addition, a number of customers, mainly convenience store chains, have converted
from branded doughnut offerings to vertically-integrated private labelsystems.
In response to these wholesale trends, the Company has reemphasized marketing of new and existing longer
shelf-life products, including products made by third parties, and has developed order management systems
to more closely match display quantities and assortments with consumer demand and reduce the amount of
unsold product. The goals of these efforts are to increase the average weekly sales derived from each wholesale
distribution point and minimize spoilage. In addition, where possible, the Company has eliminated relatively lower
sales volume distribution points and consolidated wholesale routes in order to reduce delivery costs and increase
the average revenue per distribution point and the average revenue per miledriven.
Shop Operations
General store operations. We outline standard specifications and designs for each Krispy Kreme shop
format and require compliance with our standards regarding the operation of each store, including, but not limited
to, varieties of products, product specifications, sales channels, packaging, sanitation and cleaning, signage,
furniture and fixtures, image and use of logos and trademarks, training, marketing andadvertising.
Our shops generally operate seven days a week, excluding some major holidays. Traditionally, our domestic
sales have been slower during the winter holiday season and the summermonths.
Quality standards and customer service. We encourage our team members to be courteous, helpful,
knowledgeable and attentive. We emphasize the importance of performance by linking a portion of both a
Company shop managers and assistant managers incentive compensation to profitability and customer service.
We also encourage high levels of customer service and the maintenance of our quality standards by frequently
monitoring our stores through a variety of methods, including periodic quality audits, mystery shoppers and
a toll-free consumer telephone number. In addition, our customer experience department handles customer
comments and conducts routine satisfaction surveys of our on-premisescustomers.
Management and staffing. Responsibility for our Company Stores segment is jointly vested in two
senior vice presidents who report to our chief executive officer. Our Senior Vice President of U.S. Franchises and
Company Stores focuses on operations at retail-only shops and on both the doughnut production and QSR elements
of our stores that serve both on-premises and wholesale customers. In addition, this officer also is responsible for
our domestic franchise operations. The Vice President of Company Stores Operations reports to this Senior Vice
President, and is supported by market managers in each geographic region and by shop management. Our Senior
Vice President of Wholesale Operations is responsible for wholesale distribution at all retail locations serving
wholesale customers, and for operation of our seven commissaries. The Wholesale Operations management
14

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 15

OPERATOR PM10
structure consists principally of a vice president of commissary operations who supervises the operations of our
seven commissaries through managers at these locations, and a sales organization led by a vice president and
consisting of national and regional wholesale sales managers who deal with larger customers and in-store sales
personnel responsible for managing sales and deliveries to individual customer locations. We communicate
frequently with all store managers and wholesale sales managers and their staffs using shop audits, weekly
communications by telephone or e-mail and both scheduled and surprise shopvisits.
We offer a comprehensive manager training program covering the critical skills required to operate a
Krispy Kreme store and a training program for all positions in the shop. The manager training program includes
classroom instruction, computer-based training modules and in-shoptraining.
Our staffing varies depending on a stores size, volume of business and number of sales channels. Stores,
depending on the sales channels they serve, have employees handling on-premises sales, processing, production,
bookkeeping, sanitation and delivery. Hourly employees, along with route sales personnel, are trained by local
store management through hands-on experience and trainingmanuals.
In fiscal 2011, we began enhancing our shops timekeeping systems by deploying and beginning
implementation of new labor scheduling technology to help our shop managers better match staffing levels with
consumer traffic. We continued implementation of and training on this technology in fiscal 2012 and2013.
We currently operate Company stores in 19 states and the District of Columbia. Over time, we plan
to refranchise many of our stores in markets outside our traditional base in the southeastern United States.
The franchise rights and other assets in many of these markets were acquired by the Company in business
combinations in prior years. Of the 97 stores operated by the Company as of February 3, 2013, approximately
20stores having fiscal 2013 sales of approximately $60million are candidates for refranchising at the appropriate
time. In February 2013, the Company refranchised three of these locations and closed a fourth store in the
refranchised market in January 2013 in anticipation of the transaction. These four stores had total sales in fiscal
2013 of approximately $9million.
Domestic Franchise Business Segment
The Domestic Franchise segment consists of the Companys domestic store franchise operations. This
segment derives revenue principally from initial development and franchise fees related to new stores and from
royalties on sales by franchise stores. Domestic Franchise direct operating expenses include costs incurred to
recruit new domestic franchisees, to assist with domestic store openings, to assist in the development of domestic
marketing and promotional programs, and to monitor and aid in the performance of domestic franchise stores, as
well as direct general and administrative expenses and certain allocated corporatecosts.
The store formats used by domestic franchisees are very similar to those used by the Company. All
domestic franchisees sell products to on-premises customers, and most, but not all, also sell products to wholesale
customers. Sales to wholesale customers generally constitute a smaller percentage of a domestic franchisees
total sales than do the Companys sales to wholesale customers. The Companys relatively higher percentage
of wholesale sales reflects, among other things, the fact that the Companys KK Supply Chain segment earns a
profit on sales of doughnut mixes, other ingredients and supplies that are used by the Company Stores segment to
produce products for wholesale customers, which gives the Company a cost advantage not enjoyed by franchisees
in serving this relatively lower profit margin distribution channel. Sales to wholesale customers comprised
approximately 25% of domestic franchisees total sales in fiscal2013.
Domestic franchise stores include stores that we historically have referred to as associate stores and area
developer stores, as well as franchisee stores that have opened since the beginning of calendar 2008. The rights of
our franchisees to build new stores and to use the Krispy Kreme trademarks and related marks vary by franchisee
type and are discussedbelow.

Associates. Associate franchisees are located principally in the Southeast, and their stores have attributes
that are similar to Company stores located in the Southeast. Associates typically have many years of
experience operating Krispy Kreme stores and selling Krispy Kreme branded products both at retail and
15

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 16

OPERATOR PM10
wholesale in defined territories. This group of franchisees generally concentrates on growing sales within
the current base of stores rather than developing new stores. Under their associate license agreements,
associates generally have the exclusive right to open new stores in their geographic territories, but they are
not obligated to develop additional stores. We cannot grant new franchises within an associates territory
during the term of the license agreement. Further, we generally cannot sell within an associates territory
any Krispy Kreme branded products, because we have granted those exclusive rights to the franchisee for
the term of the licenseagreement.
Associates typically have license agreements that expire in 2020. Associates generally pay royalties of
3.0% of on-premises sales and 1.0% of all other sales. Some associates also contribute 1.0% of all sales to
the Company-administered public relations and advertising fund, which we refer to as the Brand Fund. Our
Associate license agreements generally permit the franchisee to open Krispy Kreme shops within their
geographic territories without the payment of any development fee or initial franchisefee.
Of the approximately $281million of sales by domestic franchisees in the 52 weeks ended
January 27, 2013, approximately $84million, or 30%, was made by franchisees subject to the foregoing
royalty structure. The aggregate royalty revenue recognized by the Company on such sales was
approximately $2.0million.

Area developers. In the mid-1990s, we franchised territories in the United States, usually defined by
metropolitan statistical areas, pursuant to area development agreements. These development agreements
established the number of stores to be developed in an area, and the related franchise agreements governed
the operation of each store. Most of the area development agreements have expired, been terminated or
renewed with territorial and store-count (build out)modifications.
Under their franchise agreements, area developers generally have the exclusive right to sell Krispy Kreme
branded products within a one-mile radius of their stores and in wholesale accounts that they have serviced
in the last 12months.
The franchise agreements for area developers have a 15-year term that may be renewed by the Company.
These franchise agreements generally provide for royalties of 4.5% of both on-premises and wholesale
sales, and contributions to the Brand Fund of 1.0% of sales. In recent years, the Company elected to reduce
the royalty rate on wholesale sales; the Company currently charges Area Developers a royalty rate of
1.5%on wholesalesales.
Of the approximately $281million of sales by domestic franchisees in the 52 weeks ended
January 27, 2013, approximately $197million, or 70%, was made by franchisees subject to the Area
Developer royalty structure. The aggregate royalty revenue recognized by the Company on such sales was
approximately $7.7million.
Recent domestic development agreements generally provide for the payment of one-time initial
development and franchise fees ranging from $25,000 to $50,000 per store.
As of February 3, 2013, we had an equity interest in two of the domestic area developers. Where we are
an equity investor in an area developer, we contribute equity or guarantee debt of the franchisee generally
proportionate to our ownership interest. See Note 8 to the consolidated financial statements appearing
elsewhere herein for additional information on our franchisee investments. We do not currently expect to
own equity interests in any futurefranchisees.

Recent franchisees. Since fiscal 2009, the Company has signed several new franchise agreements. These
agreements included renewal agreements resulting from contract expirations, agreements for new stores
with existing franchisees and agreements with new franchisees who acquired existing Krispy Kreme
franchise and Company shops. In addition, several agreements arose from the conveyance of Company
markets to franchisees. Some of the recent franchisees have signed development agreements, which require
the franchisee to build a specified number of stores in an exclusive geography within a specified time
period, usually five years or less. The franchise agreements with this group of franchisees have a 15-year
term, are renewable provided the franchisee meets specified criteria, and generally do not contemplate
16
REVISION 4
TYPE Clean
JOB NUMBER 246088
SERIAL <12345678>
PAGE NO. 17

OPERATOR PM10
engaging in wholesale distribution. Additionally, these franchise agreements generally allow the Company
to sell Krispy Kreme branded products in close geographic proximity to the franchisees stores. These
franchise agreements and development agreements are used for all new franchisees and, in general, for
the renewal of older franchise agreements and associate license agreements. We are charging recent
franchisees the same royalty and Brand Fund rates as those charged to Area Developerfranchisees.
As of February 3, 2013, the Companys approximately 40 domestic franchisees operated a total of 142 stores.
Approximately 80% of these franchisees operate five or fewer shops, approximately 10% operate between six and
ten shops, and approximately 10% operate more than tenshops.
During fiscal 2013, domestic franchisees opened nine stores and closed seven stores. On August 30, 2012,
the Company acquired two stores from one of its domestic franchisees as more fully described in Note 21 to the
consolidated financial statements appearing elsewhere herein. The following table sets forth the type and locations
of domestic franchise stores as of February 3,2013.
Number of Domestic Franchise Stores
Factory
Hot
Fresh
Stores
Shops
Shops
Total
State
Alabama. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Arizona. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Arkansas. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
California . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Colorado. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Connecticut. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Florida. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Georgia. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Hawaii. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Idaho. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Illinois. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Iowa. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Louisiana. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Mississippi . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Missouri . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Nebraska. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Nevada . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
New Jersey . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
New Mexico. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
North Carolina . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Oklahoma. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Oregon . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Pennsylvania. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
South Carolina . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Tennessee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Texas. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Utah. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Washington. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Wisconsin. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5
1
2
15
2
1
12
5
1
1
3
1
2
3
2
1
3
1
7
2
2
4
6
1
7
2
6
1
99
3
2
7
3
1
1
1
1
1
3
2
1
29
3
1
1
2
1
1
14
8
3
2
20
2
4
20
8
1
1
3
1
2
4
3
2
5
1
3
8
2
2
8
9
1
9
2
6
2
142
The Company has equity interests in two domestic franchisees operating stores in Washington, Oregon,
Hawaii and South Florida, as more fully described in Note 8 to the consolidated financial statements appearing
elsewhere herein. The Company currently does not expect to own equity interests in franchisees in thefuture.
17

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 18

OPERATOR PM10
The Company has development agreements with certain of its domestic franchisees pursuant to which the
franchisees are contractually obligated to open additional Krispy Kreme stores. The following table sets forth
those commitments, by state, as of February 3,2013:
State
Future
Store
Commitments
Arizona . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
California . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Colorado . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Metro Philadelphia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
New Mexico . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
North Carolina . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
South Carolina . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Texas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total at February 3, 2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2
11
13
17
2
3
2
4
54
Development
Agreement
Expiration
(FISCALYear)
2015
2016
2018
2018
2015
2016
2014
2016
Changes in the number of domestic franchise stores during the past three fiscal years are summarized in the
tablebelow.
Number of Domestic Franchise Stores
Factory
Hot
Fresh
Stores
Shops
Shops
Total
JANUARY31,2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Opened. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Closed. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Change in store type. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
JANUARY30,2011. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Opened. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Closed. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
JANUARY29,2012. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Opened. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Closed. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Transferred to Company Stores. . . . . . . . . . . . . . . . . . . . . .
FEBRUARY3,2013. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
104
2
(3)
(1)
102
4
(4)
102
3
(5)
(1)
99
14
1
2
17
9
(1)
25
6
(1)
(1)
29
23
4
(1)
(1)
25
1
(11)
15
(1)
14
141
7
(4)
144
14
(16)
142
9
(7)
(2)
142
We generally assist our franchisees with issues such as operating procedures, advertising and marketing
programs, public relations, store design, training and technical matters. We also provide an opening team to
provide on-site training and assistance both for the week prior to and during the first week of operation for each
initial store opened by a new franchisee. The number of opening team members providing this assistance is
reduced with each subsequent store opening for an existingfranchisee.
International Franchise Business Segment
The International Franchise segment consists of the Companys international store franchise operations.
The franchise agreements with international area developers typically provide for the payment of royalties of
6.0% of all sales, contributions to the Brand Fund of 0.25% of sales and one-time development and franchise fees
generally ranging from $20,000 to $50,000 per store. Direct operating expenses for this business segment include
costs incurred to recruit new international franchisees, to assist with international store openings, to assist in the
development of operational tools and store designs, and to monitor and aid in the performance of international
franchise stores, as well as direct general and administrative expenses and allocated corporatecosts.
18

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 19

OPERATOR PM10
The operations of international franchise stores are similar to those of domestic stores, except that
substantially all of the sales of international franchise stores are made to on-premises customers. International
franchisees pioneered the hub and spoke business model, in which centralized factory stores or commissaries
provide fresh doughnuts to satellite locations. Internationally, the fresh shop satellite format predominates, and
shops typically are located in pedestrian-rich environments, including transportation hubs and shopping malls.
Some of our international franchisees have developed small kiosk formats, which also are typically located in
transportation hubs and shopping malls. The satellite shops operated by international franchisees tend to be
smaller than domestic satellite shops, and the international satellite shops have lower average unit volumes than do
domestic satelliteshops.
Our International Franchisees have renewable development agreements regarding the build-out of Krispy
Kreme stores in their territories. Territories are typically country or region-wide, but for large countries, the
development territory may encompass only a portion of a country. The international franchise agreements have a
renewable 15-year term. These agreements generally do not contemplate distribution through wholesale channels,
although our franchisees in Canada, Australia and the United Kingdom make suchsales.
Product offerings at shops outside the United States include our signature Original Glazed doughnut, a core
set of doughnut varieties offered in our domestic shops and a complementary set of localized doughnut varieties
tailored to meet the unique taste preferences and dietary norms in the market. Often, our glazes, icings and filling
flavors are tailored to meet local taste preferences. We work closely with our franchisees outside the United States
to conduct marketing research to understand local tastes and usage occasions, which drives development of new
products and marketingapproaches.
Internationally, we believe that complementary products such as baked goods and other treat products could
play an increasingly important role for our franchisees as they penetrate their markets and further establish the
Krispy Kreme brand. These items offer franchisees the opportunity to fill and/or strengthen day part offerings to
meet a broader set of customer needs. Krispy Kreme Baked Creations, a baked platform for international markets
designed to meet needs across a broad set of markets, was launched in fiscal 2010 in the Philippines. Today,
our Krispy Kreme Baked Creations products are available in the Philippines, Korea, Indonesia, Saudi Arabia
andTurkey.
Beverage offerings at shops outside the United States include a complete program consisting of hot and iced
espresso based beverages, frozen drinks, teas, juices, sodas, water and bottled or canned beverages. Drip coffee
is also offered in many international markets, but represents a much smaller component of the beverage program
relative to the United States due to international consumer preferences. In-store consumption occasions often play
a key role in total beverage consumption internationally due to store locations and consumer habits, and we work
closely with international franchisees to adapt the store environment and product offerings to take advantage of
this dynamic. We continue to look for ways to improve our beverage program and bring cross-market efficiencies
to internationalfranchisees.
Markets outside the United States have been a significant source of growth, all of which we plan to develop
by franchising. In the past three years, we have focused our international development efforts primarily on
opportunities in markets in Asia and the Middle East. In fiscal 2013, we signed new international franchise
agreements with franchisees in Moscow, India and Singapore. In addition to ongoing development efforts in
these areas, we are focusing franchise marketing efforts on new markets, including Europe and South and
CentralAmerica.
Generally, there is a single franchisee in each of the countries outside the United States where Krispy Kreme
is represented. During fiscal 2013, the Company signed development agreements for portions of India with two
franchisees, and there may be more than one franchisee in a given country going forward. All of the Krispy Kreme
shops in the Middle East are operated by a singlefranchisee.
19
REVISION 4
SERIAL <12345678>
TYPE Clean
JOB NUMBER 246088
PAGE NO. 20

OPERATOR PM10
The types and locations of international franchise stores as of February 3, 2013 are summarized in the
tablebelow.
Number of International Franchise Stores
Fiscal
Year First
Factory
Hot
Fresh
Store Opened
Stores
Shops
Shops
Kiosks
Country
Australia . . . . . . . . . . . . . . . . . . . . .
Bahrain . . . . . . . . . . . . . . . . . . . . . .
Canada . . . . . . . . . . . . . . . . . . . . . .
China . . . . . . . . . . . . . . . . . . . . . . . .
Dominican Republic . . . . . . . . . . . .
India . . . . . . . . . . . . . . . . . . . . . . . .
Indonesia . . . . . . . . . . . . . . . . . . . . .
Japan . . . . . . . . . . . . . . . . . . . . . . . .
Kuwait . . . . . . . . . . . . . . . . . . . . . . .
Lebanon . . . . . . . . . . . . . . . . . . . . .
Malaysia . . . . . . . . . . . . . . . . . . . . .
Mexico . . . . . . . . . . . . . . . . . . . . . .
Philippines . . . . . . . . . . . . . . . . . . .
Puerto Rico . . . . . . . . . . . . . . . . . . .
Qatar . . . . . . . . . . . . . . . . . . . . . . . .
Saudi Arabia . . . . . . . . . . . . . . . . . .
South Korea . . . . . . . . . . . . . . . . . .
Thailand . . . . . . . . . . . . . . . . . . . . .
Turkey . . . . . . . . . . . . . . . . . . . . . . .
United Arab Emirates . . . . . . . . . . .
United Kingdom . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . .
2004
2009
2002
2010
2011
2013
2007
2007
2007
2009
2010
2004
2007
2009
2008
2008
2005
2011
2010
2008
2004
5
1
4
1
1
1
1
17
2
2
2
7
6
5
2
9
34
3
1
2
14
120
1
3
2
9
6
1
2
1
2
3
25
5
5
1
33
24
65
33
2
10
9
30
257
6
1
5
50
8
21
1
4
5
9
123
Total
18
2
6
2
3
1
11
42
13
8
8
91
41
5
2
95
67
8
15
16
55
509
The Company has an equity interest in the franchisee operating a store in Western Canada. The Company
currently does not expect to own equity interests in franchisees in thefuture.
The Company has development agreements with certain of its international franchisees pursuant to which
the franchisees are contractually obligated to open additional Krispy Kreme stores. The following table sets forth
those commitments as of February 3,2013:
Country
Future
Store
Commitments
Australia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Dominican Republic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
India . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Japan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Malaysia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Mexico . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Puerto Rico . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Russia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Singapore . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Thailand . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
United Kingdom . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total at February 3, 2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
15
11
114
74
12
36
2
35
15
13
26
353
20
Development
Agreement
Expiration
(fiscalYear)
2019
2015
2018
2017
2014
2019
2014
2018
2017
2015
2018

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 21

OPERATOR PM10
Changes in the number of international franchise stores during the past three fiscal years are summarized in
the tablebelow.
Number of International Franchise Stores
Factory
Hot
Fresh
Stores
Shops
Shops
Kiosks
Total
JANUARY 31,2010 . . . . . . . . . . . . . . . . . . . . . . . . .
Opened. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Closed. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Change in store type. . . . . . . . . . . . . . . . . . . . . . . . .
JANUARY30,2011. . . . . . . . . . . . . . . . . . . . . . . . .
Opened. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Closed. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
JANUARY29,2012. . . . . . . . . . . . . . . . . . . . . . . . .
Opened. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Closed. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
FEBRUARY3,2013. . . . . . . . . . . . . . . . . . . . . . . . .
95
19
(6)
(2)
106
17
(5)
118
10
(7)
(1)
120
14
(3)
11
3
(3)
11
(1)
(1)
9
180
56
(16)
2
222
38
(17)
(17)
226
63
(26)
(6)
257
69
20
(11)
78
18
(11)
20
105
25
(15)
8
123
358
95
(36)
417
76
(33)
460
98
(49)
509
KK Supply Chain Business Segment

The Company operates an integrated supply chain to help maintain the consistency and quality of products
throughout the Krispy Kreme system. The KK Supply Chain segment buys and processes ingredients it uses
to produce doughnut mixes and manufactures doughnut-making equipment that all factory stores are required
topurchase.
The Company manufactures doughnut mixes at its facility in Winston-Salem, North Carolina. The Company
also manufactures doughnut mix concentrates, which are blended with flour and other ingredients by contract
mix manufacturers to produce finished doughnut mix. In February 2009, the Company entered into an agreement
with an independent food company to manufacture certain doughnut mixes using concentrate for domestic regions
outside the southeastern United States and to provide backup production capability in the event of a business
disruption at the Winston-Salemfacility.
In addition to traditional doughnut mixes and mixes made from mix concentrates, the Company manages
the production of doughnut premix, which is used to produce doughnut mixes in certain international locations.
The premix is shipped to Krispy Kreme stores, where it is combined with locally sourced ingredients to produce
doughnut mixes for use at the store. The premix and concentrate production models are used to produce doughnut
mixes outside the United States in order to reduce the substantial international transportation costs associated
with shipping finished mixes, to minimize foreign import taxes, and to help protect the Companys intellectual
property. The Company utilizes contract mix manufacturers in the United Kingdom, Mexico, Japan, Korea,
Malaysia and Australia to blend mixes for certain international franchisees using mix concentrates or the
premixprocess.
The KK Supply Chain segment also purchases and sells key supplies, including icings and fillings, other
food ingredients, juices, signage, display cases, uniforms and other items to both Company and franchisee-owned
stores. In addition, through KK Supply Chain, the Company utilizes volume-buying power, which the Company
believes helps lower the cost of supplies to stores and enhances profitability. In March 2011, the Company entered
into an agreement with an independent distributor to distribute products to Company and franchise stores in
the eastern portion of the United States, as well as to handle the export of products to the 21 foreign countries
in which the Companys international franchisees operate. The Company has subcontracted with another
independent distributor since 2008 to distribute products to domestic stores in the western portion of the country.
Implementation of the eastern U.S. outsourcing resulted in all of KK Supply Chains distribution operations being
handled by contract distributors. The Company believes that moving to a 100% outsourced model has enabled the
21
REVISION 4
JOB NUMBER 246088
TYPE Clean
SERIAL <12345678>
PAGE NO. 22

OPERATOR PM10
Company and its franchisees to benefit from the operating scale of the independent distributors and, in the case
of outsourcing of all export functions, to minimize the compliance and other risks associated with exporting to a
large number of countries with diverse import regulations andprocedures.
Substantially all domestic stores purchase all of their ingredients and supplies from KK Supply Chain,
while KK Supply Chain sales to international franchise stores are comprised principally of sales of doughnut
mix. The Company is continuously studying its distribution system to reduce the delivered cost of products to
both Company and franchise stores. The Company expects to employ increased local sourcing for international
franchisees in order to reduce costs, while maintaining control of the doughnut mix manufacturingprocess.
Flour, shortening, sugar and packaging represent the four most significant cost components of products sold
by KK Supply Chain. While the flours used in the production of doughnut mixes are generic, the food properties
of flour are different by type of flour and change from crop year to crop year. Accordingly, the Company
periodically must reformulate its doughnut mixes to account for changes in the characteristics of the flour used
in their production in order to maintain uniform, high quality doughnut products. Similarly, while the shortening
in which the Companys doughnuts are fried is made from generic food oils, the specific components and other
formula elements of the Companys shortening are proprietary, and the Companys shortenings are manufactured
by third-party food companies to the Companys specifications. Such specifications are subject to change from
time to time. For example, changes in the formulation of the Companys shortening were necessary to enable the
Company to begin offering zero grams transfats per serving of its doughnuts in fiscal2008.
The Supply Chain business unit is volume-driven, and its economics are enhanced by the opening of new
stores and the growth of sales by existingstores.
Revenues by Geographic Region
Set forth below is a table presenting our revenues by geographic region for fiscal 2013, 2012 and 2011.
Revenues by geographic region are presented by attributing revenues from customers on the basis of the location
to which the Companys products are delivered or, in the case of franchise segment revenues, the location of the
franchise store from which the franchise revenue is derived. Please note that fiscal 2013 contained 53weeks.
Revenues by geographic region:

United States . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other North America . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Asia/Pacific . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Middle East . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Europe . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
February 3,
2013
Year Ended
January 29,
2012
(In thousands)
January 30,
2011
$391,835
9,184
22,384
6,687
5,753
$435,843
$361,653
8,559
19,964
7,835
5,206
$403,217
$324,934
5,864
18,542
9,152
3,463
$361,955
Marketing
Krispy Kremes approach to marketing is a natural extension of our brand equity, brand attributes,
relationship with our customers and our values. During fiscal 2011, we hired a chief marketing officer with
extensive experience in the QSR business to lead and unify our marketing programs on a globalbasis.
22

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 23

OPERATOR PM10
Domestic
To build our brand and drive our sales in a manner aligned with our brand values, we will focus our domestic
marketing activities in the followingareas:
Shop Experience. Our factory stores and smaller neighborhood shops are where most guests first
experience a hot Original Glazed doughnut. Customers know that when our Hot Krispy Kreme Original Glazed
Now sign in the shop window is illuminated, they can enjoy a hot Original Glazed doughnut. We believe this
experience begins our relationship with our guests and forms the foundation of the Krispy Kremeexperience.
Relationship Marketing. The foundation of our marketing efforts starts with building a relationship
between our brand and our team members, guests, consumers and their communities. Toward that end, many of
our brand-building activities are grassroots-based and focused on building relevancy with these groups. These
activitiesinclude:

Good neighbor product deliveries to create trialuses;

Sponsorship of local events and nonprofitorganizations;

Friends of Krispy Kreme eMessages sent to guests registered to receive monthly updates about new
products, promotions and shopopenings;

Fundraising programs designed to assist local charitable organizations in raising money for their non-profit
causes which the Company estimates helped raise over $30million for these organizations during fiscal
2013; and

Digital, social, viral and interactive efforts including the use of social media such as Facebook and Twitter
to communicate product and promotional activity, new shop openings and local relationship marketing
programs. We currently have over 4.6million fans onFacebook.
Public Relations. We utilize public relations and media relations, product placement, event marketing and
community involvement as vehicles to generate brand awareness, brand relevancy and trial usage for our products.
Our public relations activities create opportunities for media and consumers to interact with the Krispy Kreme
brand. Our key messages are asfollows:

Krispy Kreme doughnuts are the preferred doughnut of choice for guestsnationwide;

Krispy Kreme is a trusted food retailer with a long history of providing superior, innovative products and
delivering quality customer service; and

Krispy Kreme cares about our brand, our team members, our guests, our consumers and the communities
weserve.
Marketing, Advertising and Sales Promotion. Local relationship marketing has been central to building
our brand, awareness and relevancy. In addition to these grassroots efforts, we will use other media as appropriate
to communicate the brand, promotions and other promotional activities. These media may include traditional
tactics (e.g., free-standing newspaper inserts, direct mail, shared mail, radio, television, out-of-home and other
communications vehicles) and alternative media such as social, viral, and digital (e.g., Facebook, Twitter, blogs,
Krispykreme.com, Friends of Krispy Kreme email club,etc.).
These activities may include limited time offerings and shaped doughnut varieties, such as Valentines Day
Hearts, Fall Footballs, Halloween Pumpkins and Holiday Snowmen. We also engage in activities and call attention
to and leverage the Krispy Kreme experience and engage the public in non-traditionalways.
International
Krispy Kremes approach to international marketing utilizes many of the same elements as the domestic
marketing approach to build integrated marketing initiatives through store experience, relationship marketing, public
relations and marketing/advertising/sales promotion. One of the key foundations to developing integrated marketing
programs that leverage each of these marketing elements is our efforts and focus on driving category-leading new
23

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 24

OPERATOR PM10
product innovation. New product innovation is a critical focus internationally as it allows us to engage consumers
more often through our marketing efforts and, at the same time, evolve our product range to more effectively meet
local taste demands. This focus on new product innovation has resulted in innovations such as our Krispy Kreme
Baked Creations line of baked goods and innovation within our core doughnut range. Those core product range
innovations include chocolate glaze and chocolate dough, whole wheat dough, minis, doughnut holes, doughnut pops
and new doughnut varieties leveraging co-promotional relationships with international chocolate brands, movies and
brandedtoys.
Our international marketing team works closely with the domestic marketing team to develop global
programs that leverage key global occasions and celebrations, including programs for Valentines Day, Halloween
and the holiday season. In addition, we develop international specific programs that address the broad needs of our
international markets, regional programs that address trends and occasions unique to Asia/Pacific, Latin America
and the Middle East/Europe, and assist in the development of local country programs that leverage unique aspects
of our broad set ofmarkets.
To build our brand and drive sales across our international markets, our international team provides strategic
leadership, marketing expertise and consulting on local market issues through dedicated regional resources. In
partnership with our franchisees, we assist in local marketing planning, product offering innovation, promotional
and store activation, and consumer messaging. In addition, we develop global and regional product, promotional
and store event programs to supplement and enhance local country marketing initiatives, bring marketing
efficiencies to international franchisees, and build local marketingcapabilities.
Brand Fund
We administer domestic and international public relations and advertising funds, which we refer to as the
Brand Funds. Franchise agreements with domestic area developers and international area developers require
these franchisees to contribute 1.0% and 0.25% of their sales, respectively, to the Brand Funds. Company stores
contribute to the Brand Fund on the same basis as domestic area developers, as do some associate franchisees. In
fiscal 2011, the Company reduced the contribution from its associate and domestic area developer franchisees to
0.75% but reverted to the 1.0% rate in fiscal 2012 and 2013. Proceeds from the Brand Funds are utilized to develop
programs to increase sales and brand awareness and build brand affinity. Brand Fund proceeds are also utilized to
measure consumer feedback and the performance of our products and stores. In fiscal 2013, we and our domestic
and international franchisees contributed approximately $6.3million to the BrandFunds.
Competition
Our domestic and international competitors include a wide range of retailers of doughnuts and other treats,
coffee shops, other caf and bakery concepts. We also compete with snacks sold through convenience stores,
supermarkets, restaurants and retail stores domestically, but to a much lesser extent internationally. Some of our
competitors have substantially greater financial resources than we do and are expanding to other geographic
regions, including areas where we have a significant store presence. We also compete against other retailers who
sell sweet treats such as cookie, cupcake and ice cream shops. We compete on elements such as food quality,
convenience, location, customer service and value. Customer service, including frequency of deliveries and
maintenance of fully stocked shelves, is an important factor in successfully competing for convenience store and
grocery/mass merchant business. There is an industry trend moving towards expanded fresh product offerings
at convenience stores during morning and evening drive times, and products are either sourced from a central
commissary or brought in by localbakeries.
In the packaged doughnut market, an array of doughnuts is typically merchandised on a free-standing
branded display. We compete for sales with many sweet treats, including those made by well-known producers,
such as Dolly Madison, Entenmanns, Little Debbie, Sara Lee, and regionalbrands.
We view the uniqueness of our Original Glazed doughnut as an important factor that distinguishes our
brand from competitors, both in the doughnut category and in sweet goodsgenerally.
24
REVISION 4
JOB NUMBER 246088
TYPE Clean
SERIAL <12345678>
PAGE NO. 25

OPERATOR PM10
Trademarks and Trade Names

Our doughnut shops are operated under the Krispy Kreme trademark, and we use many federally and
internationally registered trademarks and service marks, including Original Glazed and Hot Krispy Kreme
Original Glazed Now and the logos associated with these marks. We have also registered some of our trademarks
in approximately 60 other countries. We generally license the use of these trademarks to our franchisees for the
operation of their doughnutshops.
Although we are not aware of anyone else using Krispy Kreme or Hot Krispy Kreme Original Glazed
Now as a trademark or service mark in the United States, we are aware that some businesses are using Krispy
or a phonetic equivalent, such as Crispie Creme, as part of a trademark or service mark associated with retail
doughnut shops. There may be similar uses of which we are unaware that could arise from prior users. When
necessary, we aggressively pursue persons who use our trademarks without ourconsent.
Government Regulation
Environmental regulation. The Company is subject to a variety of federal, state and local environmental
laws and regulations. Except for the legal and settlement costs totaling approximately $2.5million in fiscal
2010 associated with the settlement of litigation relating to alleged damage to a sewer system in Fairfax County,
Virginia, such laws and regulations have not had a significant impact on the Companys capital expenditures,
earnings or competitiveposition.
Local regulation. Our shops, both those in the United States and those in international markets, are
subject to licensing and regulation by a number of government authorities, which may include health, sanitation,
safety, fire, building and other agencies in the countries, states or municipalities in which the shops are located.
Developing new doughnut shops in particular areas could be delayed by problems in obtaining the required
licenses and approvals or by more stringent requirements of local government bodies with respect to zoning, land
use and environmental factors. Our agreements with our franchisees require them to comply with all applicable
federal, state and local laws and regulations, and indemnify us for costs we may incur attributable to their failure
tocomply.
Food product regulation. Our doughnut mixes are primarily produced at our manufacturing facility in
Winston-Salem, North Carolina. Production at and shipments from our Winston-Salem facility are subject to the
applicable federal and state governmental rules and regulations. Similar state regulations may apply to products
shipped from our doughnut shops to convenience stores or grocers/massmerchants.
As is the case for other food producers, numerous other government regulations apply to our products. For
example, the ingredient list, product weight and other aspects of our product labels are subject to state, federal
and international regulation for accuracy and content. Most states periodically check products for compliance.
The use of various product ingredients and packaging materials is regulated by the United States Department of
Agriculture and the Federal Food and Drug Administration. Conceivably, one or more ingredients in our products
could be banned, and substitute ingredients would then need to beidentified.
International trade. The Company conducts business outside the United States in compliance with all
foreign and domestic laws and regulations governing international trade. In connection with our international
operations, we typically export our products, principally our doughnut mixes (or products which are combined
with other ingredients sourced locally to manufacture mixes) to our franchisees in markets outside the United
States. Numerous government regulations apply to both the export of food products from the United States as well
as the import of food products into other countries. If one or more of the ingredients in our products are banned,
alternative ingredients would need to be identified. Although we intend to be proactive in addressing any product
ingredient issues, such requirements may delay our ability to open shops in other countries in accordance with our
desiredschedule.
Franchise regulation. We must comply with regulations adopted by the Federal Trade Commission
(the FTC) and with several state and foreign laws that regulate the offer and sale of franchises. The FTCs
Trade Regulation Rule on Franchising (FTC Rule) and certain state and foreign laws require that we furnish
prospective franchisees with a franchise disclosure document containing information prescribed by the FTC Rule
25

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 26

OPERATOR PM10
and applicable state and foreign laws and regulations. We register in domestic and foreign jurisdictions that require
registration for the sale of franchises. Our domestic franchise disclosure document complies with FTC disclosure
requirements, and our international disclosure documents comply with applicablerequirements.
We also must comply with a number of state and foreign laws that regulate some substantive aspects of
the franchisor-franchisee relationship. These laws may limit a franchisors ability to: terminate or not renew
a franchise without good cause; interfere with the right of free association among franchisees; disapprove the
transfer of a franchise; discriminate among franchisees with regard to charges, royalties and other fees; and place
new shops near existingfranchises.
Bills intended to regulate certain aspects of franchise relationships have been introduced into the United
States Congress on several occasions during the last decade, but none have beenenacted.
Employment regulations. We are subject to state and federal labor laws that govern our relationship
with team members, such as minimum wage requirements, overtime and working conditions and citizenship
requirements. Many of our shop team members are paid at rates which are influenced by changes in the federal
minimum wage. Accordingly, further increases in the minimum wage could increase our labor costs. The work
conditions at our facilities are regulated by the Occupational Safety and Health Administration and are subject to
periodic inspections by this agency. In addition, the enactment of recent legislation and resulting new government
regulation relating to healthcare benefits have resulted in increased costs, and may result in additional cost
increases and other effects in the future. See Managements Discussion and Analysis of Financial Condition and
Results of Operations Fiscal 2013 Compared to Fiscal 2012 Company Stores Costs andexpenses.
Other regulations. We are subject to a variety of consumer protection and similar laws and regulations at
the federal, state and local level. Failure to comply with these laws and regulations could subject us to financial
and other penalties. We have several contracts to serve United States military bases, which require compliance
with certain applicable regulations. The stores which serve these military bases are subject to health and
cleanliness inspections by militaryauthorities.
Team Members
We employ approximately 4,300 people. Of these, approximately 200 are employed in our headquarters and
administrative offices and approximately 100 are employed in our manufacturing and distribution center. We
employ approximately 500 employees in our commissaries which serve wholesale customers almost exclusively,
most of whom are employed full-time. In our other Krispy Kreme stores, we employ approximately 3,500 team
members, of which approximately 2,000 are full-time (including approximately 500 managers, assistant managers
and supervisors) with the balance employed part-time.
We are not a party to any collective bargaining agreement, although we have experienced occasional
unionization initiatives. We believe our relationships with our team members generally aregood.
Available Information
We maintain a website at www.krispykreme.com. The information on our website is available for
information purposes only and is not incorporated by reference in this Annual Report on Form 10-K.
We make available on or through our website certain reports and amendments to those reports, if applicable,
that we file with or furnish to the SEC in accordance with the Exchange Act. These include our annual reports
on Form 10-K, our quarterly reports on Form 10-Q, our current reports on Form 8-K and amendments to those
reports. We make this information available on our website free of charge as soon as reasonably practicable after
we electronically file the information with, or furnish it to, theSEC.
In addition, many of our corporate governance documents are available on our website. Our Nominating
and Corporate Governance Committee Charter is available at www.krispykreme.com/gov_charter.pdf, our
Compensation Committee Charter is available at www.krispykreme.com/comp_charter.pdf, our Audit Committee
Charter is available at www.krispykreme.com/audit_charter.pdf, our Corporate Governance Guidelines are
available at www.krispykreme.com/corpgovernance.pdf, our Code of Business Conduct and Ethics is available
26
REVISION 4
JOB NUMBER 246088
TYPE Clean
SERIAL <12345678>
PAGE NO. 27

OPERATOR PM10
at www.krispykreme.com/code_of_ethics.pdf, and our Code of Ethics for Chief Executive and Senior Financial
Officers is available at www.krispykreme.com/officers_ethics.pdf. Each of these documents is available in print
to any shareholder who requests it by sending a written request to Krispy Kreme Doughnuts, Inc., 370 Knollwood
Street, Winston-Salem, NC 27103, Attention:Secretary.
Item 1A. RISKFACTORS.
Our business, operations and financial condition are subject to various risks. Some of these risks are
described below, and you should take such risks into account in evaluating us or any investment decision involving
our Company. This section does not describe all risks that may be applicable to us, our industry or our business,
and it is intended only as a summary of certain material risk factors. More detailed information concerning the
risk factors described below is contained in other sections of this Annual Report on Form 10-K.
RISKS RELATING TO OUR BUSINESS
Store profitability is sensitive to changes in salesvolume.
Each factory store has significant fixed or semi-fixed costs, and margins and profitability are significantly
affected by doughnut sales volume. Because significant fixed and semi-fixed costs prevent us from reducing our
operating expenses in proportion with declining sales, our earnings are negatively impacted if salesdecline.
A number of factors have historically affected, and will continue to affect, our sales results, including, among
otherfactors:

Consumer trends, preferences and disposableincome;

Our ability to execute our business strategyeffectively;

Competition;

General regional and national economic conditions; and

Seasonality and weatherconditions.
Changes in our sales results could cause the price of our common stock to fluctuatesubstantially.
We rely in part on our franchisees. Disputes with our franchisees, or failures by our franchisees to
operate successfully, to develop or finance new stores or build them on suitable sites or open them on
schedule, could adversely affect our growth and our operatingresults.
Franchisees, which are all independent operators and not Krispy Kreme employees, contributed (including
through purchases from KK Supply Chain) approximately 32% of our total revenues in fiscal 2013. We rely in part
on these franchisees and the manner in which they operate their locations to develop and promote our business.
We occasionally have disputes with franchisees, which could materially adversely affect our business, financial
condition and results of operations. We provide training and support to franchisees, but the quality of franchise
store operations may be diminished by any number of factors beyond our control. The failure of our franchisees
to operate franchises successfully could have a material adverse effect on us, our reputation and our brands, and
could materially adversely affect our business, financial condition and results of operations. In addition, although
we do not control our franchisees and they operate as independent contractors, actions taken by any of our
franchisees may be seen by the public as actions taken by us, which, in turn, could adversely affect our reputation
orbrands.
Lack of access to financing by our franchisees on reasonable terms could adversely affect our future
operations by limiting franchisees ability to open new stores or leading to additional franchisee store closures,
which would in turn reduce our franchise revenues and KK Supply Chain revenues. Most development agreements
specify a schedule for opening stores in the territory covered by the agreement. These schedules form the basis for
our expectations regarding the number and timing of new Krispy Kreme store openings. In the past, Krispy Kreme
has agreed to extend or modify development schedules for certain franchisees and may do so in thefuture.
27

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 28

OPERATOR PM10
Franchisees opened 107 stores and closed 56 stores in fiscal 2013. Royalty revenues and most KK Supply
Chain revenues are directly related to sales by franchise stores and, accordingly, the success of franchisees
operations has a direct effect on our revenues, results of operations and cashflows.
A portion of our growth strategy depends on opening new Krispy Kreme stores both domestically
and internationally. Our ability to expand our store base is influenced by factors beyond our and our
franchisees control, which may slow store development and impair ourstrategy.
Our recent growth reflects the opening of new Krispy Kreme stores internationally, while the number of
domestic franchise shops has remained almost constant over the past three years. Our ability to expand our store
base both domestically and internationally is influenced by factors beyond our and our franchisees control, which
may slow store development and impair our growth strategy. The success of these new stores will be dependent in
part on a number of factors, which neither we nor our franchisees cancontrol.
Our new domestic store operating model may not besuccessful.
We are working to refine our domestic store operating model to focus on small retail shops, including
both satellite shops and shops that manufacture doughnuts but which are smaller and have lower capacity than
traditional factory stores. Satellite stores in a market are provided doughnuts from a single traditional factory
store or commissary at which all doughnut production for the market takes place. The Company currently plans
to open from seven to ten new Company-operated small shops in fiscal 2014, most of which we expect to be small
factory shops. Domestic franchisees also may open additional satellite stores and a small number of factory stores,
as we work to refine our store formats for new domestic stores. We cannot predict whether this new model will be
successful in increasing ourprofitability.
Political, economic, currency and other risks associated with our international operations could adversely
affect our and our international franchisees operatingresults.
As of February 3, 2013, there were 509 Krispy Kreme stores operated outside of the United States,
representing 68% of our total store count, all of which were operated by franchisees. Our revenues from
international franchisees are exposed to the potentially adverse effects of our franchisees operations, political
instability, currency exchange rates, local economic conditions and other risks associated with doing business
in foreign countries. Royalties are based on a percentage of net sales generated by our foreign franchisees
operations. Royalties payable to us by our international franchisees are based on a conversion of local currencies to
U.S. dollars using the prevailing exchange rate, and changes in exchange rates could adversely affect our revenues.
To the extent that the portion of our revenues generated from international operations increases in the future, our
exposure to changes in foreign political and economic conditions and currency fluctuations willincrease.
We typically export our products, principally our doughnut mixes and doughnut mix concentrates, to our
franchisees in markets outside the United States. Numerous government regulations apply to both the export of
food products from the United States as well as the import of food products into other countries. If one or more of
the ingredients in our products are banned, alternative ingredients would need to be identified. Although we intend
to be proactive in addressing any product ingredient issues, such requirements may delay our ability to open stores
in other countries in accordance with our desiredschedule.
Our profitability is sensitive to changes in the cost of fuel and rawmaterials.
Although we utilize forward purchase contracts and futures contracts and options on such contracts to
mitigate the risks related to commodity price fluctuations, such contracts do not fully mitigate commodity price
risk, particularly over the longer term. In addition, the portion of our anticipated future commodity requirements
that is subject to such contracts varies from time totime.
Flour, shortening and sugar are our three most significant ingredients. We also purchase a substantial amount
of gasoline to fuel our fleet of wholesale delivery vehicles. The prices of wheat and soybean oil, which are the
principal components of flour and shortening respectively, and of sugar and gasoline, have been volatile in recent
years. Adverse changes in commodity prices could adversely affect the Companysprofitability.
28

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 29

OPERATOR PM10
We are the exclusive supplier of doughnut mixes or mix concentrates to all Krispy Kreme stores
worldwide. We also supply other key ingredients and flavors to all domestic Krispy Kreme Company
stores. If we have any problems supplying these ingredients, our and our franchisees ability to make
doughnuts could be negativelyaffected.
We are the exclusive supplier of doughnut mixes for many domestic and international Krispy Kreme
stores. As to other stores, we are the exclusive supplier of doughnut mix concentrates that are blended with other
ingredients to produce doughnut mixes. We also are the exclusive supplier of other key ingredients and flavors
to all domestic Company stores, most domestic franchise stores and some international franchise stores. We
manufacture the doughnut mixes and concentrates at our mix manufacturing facility located in Winston-Salem,
North Carolina. We distribute doughnut mixes and other key ingredients and flavors using independent contract
distributors for Krispy Kreme shops domestically and internationally. We have a backup source to manufacture
our doughnut mixes in the event of a loss of our Winston-Salem facility; this backup source currently produces
mix for us for distribution in most Krispy Kreme stores west of the Mississippi River. Nevertheless, an interruption
of production capacity at our manufacturing facility could impede our ability or that of our franchisees to make
doughnuts. In addition, in the event that any of our supplier relationships terminate unexpectedly, even where we
have multiple suppliers for the same ingredient, we may not be able to obtain adequate quantities of the same highquality ingredient at competitiveprices.
We are the only manufacturer of substantially all of our doughnut-making equipment. If we have any
problems producing this equipment, our stores ability to make doughnuts could be negativelyaffected.
We manufacture our custom doughnut-making equipment in one facility in Winston-Salem, North Carolina.
Although we have limited backup sources for the production of our equipment, obtaining new equipment quickly
in the event of a loss of our Winston-Salem facility would be difficult and would jeopardize our ability to supply
equipment to new stores or new parts for the maintenance of existing equipment in established stores on a
timelybasis.
We have only one supplier of glaze flavoring, and any interruption in supply could impair our ability to
make our signature hot Original Glazed doughnut.
We utilize a sole supplier for our glaze flavoring. Any interruption in the distribution from our current
supplier could affect our ability to produce our signature hot Original Glazed doughnut.
We are subject to franchise laws and regulations that govern our status as a franchisor and regulate
some aspects of our franchise relationships. Our ability to develop new franchised stores and to enforce
contractual rights against franchisees may be adversely affected by these laws and regulations, which
could cause our franchise revenues todecline.
As a franchisor, we are subject to regulation by the FTC and by domestic and foreign laws regulating the
offer and sale of franchises. Our failure to obtain or maintain approvals to offer franchises would cause us to lose
future franchise revenues and KK Supply Chain revenues. In addition, domestic or foreign laws that regulate
substantive aspects of our relationships with franchisees may limit our ability to terminate or otherwise resolve
conflicts with our franchisees. Because we plan to grow primarily through franchising, any impairment of our
ability to develop new franchise stores will negatively affect us and our growthstrategy.
Sales to wholesale customers represent a significant portion of our sales. The infrastructure necessary to
support wholesale distribution results in significant fixed and semi-fixed costs. Also, the loss of one of our
large wholesale customers could adversely affect our financial condition and results ofoperations.
We have several large wholesale customers. Our top two such customers accounted for approximately
16%of total Company Stores segment revenues during fiscal 2013. The loss of one of our large national wholesale
customers could adversely affect our results of operations across all domestic business segments. These customers
do not enter into long-term contracts; instead, they make purchase decisions based on a combination of price,
29

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 30

OPERATOR PM10
product quality, consumer demand and service quality. They may in the future use more of their shelf space,
including space currently used for our products, for other products, including private label products. If our sales to
one or more of these customers are reduced, this reduction may adversely affect ourbusiness.
The Company operates a fleet network to support wholesale sales. Declines in wholesale sales without a
commensurate reduction in operating expenses, as well as rising fuel costs, may adversely affect ourbusiness.
Our failure or inability to enforce our trademarks could adversely affect the value of ourbrands.
We own certain common-law trademark rights in the United States, as well as numerous trademark and
service mark registrations in the United States and in other jurisdictions. We believe that our trademarks and
other intellectual property rights are important to our success and our competitive position. We therefore devote
appropriate resources to the protection of our trademarks and aggressively pursue persons who unlawfully and
without our consent use or register our trademarks. We have a system in place that is designed to detect potential
infringement on our trademarks, and we take appropriate action with regard to such infringement as circumstances
warrant. The protective actions that we take, however, may not be sufficient, in some jurisdictions, to secure our
trademark rights for some of the goods and services that we offer or to prevent imitation by others, which could
adversely affect the value of our trademarks and servicemarks.
In certain jurisdictions outside the United States, specifically Costa Rica, Guatemala, India, Indonesia,
Nigeria, Peru, the Philippines and Venezuela, we are aware that some businesses have registered, used and/or may
be using Krispy Kreme (or its phonetic equivalent) in connection with doughnut-related goods and services.
There may be similar such uses or registrations of which we are unaware and which could perhaps arise from prior
users. These uses and/or registrations could limit our operations and possibly cause us to incur litigation costs, or
pay damages or licensing fees to a prior user or registrant of similar intellectualproperty.
Loss of our trade secret recipes could adversely affect oursales.
We derive significant competitive benefit from the fact that our doughnut recipes are trade secrets.
Although we take reasonable steps to safeguard our trade secrets, should they become known to competitors, our
competitive position could suffersubstantially.
Recent healthcare legislation could adversely affect ourbusiness.
Federal legislation regarding government-mandated health benefits is expected to increase our and
our domestic franchisees costs. Due to the breadth and complexity of the healthcare legislation, the lack of
implementing regulations and interpretive guidance, and the phased-in nature of the implementation, it is difficult
to predict the overall impact of the healthcare legislation on our business and the businesses of our domestic
franchisees over the coming years. Possible adverse effects of the legislation include increased costs, exposure
to expanded liability and requirements for us to revise the ways in which we conduct business. Our results of
operations, financial position and cash flows could be adversely affected. Our domestic franchisees face the
potential of similar adverseeffects.
We are making investments to improve our information technology systems to increase our operational
capabilities and effectiveness. Cost overruns or delays or difficulties in implementing new point-of-sale
software or a planned enterprise resource planning system may adversely affect our business and results
ofoperations.
We expect to increase investments during fiscal 2014 in technology and related infrastructure designed to
improve our operational capabilities and effectiveness and to provide modern technology platforms to support
future growth of our business. We are in the process of implementing new Company-wide point-of-sale system
software and are in the planning stages of selecting and beginning implementation of a new enterprise resource
planning system. Implementing these systems is a lengthy and expensive process that may result in a diversion of
resources from other initiatives and activities. Continued execution of the project plans, or a divergence from them,
may result in cost overruns, project delays or business interruptions. Any disruptions, delays or deficiencies in the
design and/or implementation of these systems, or our inability to accurately predict the costs of such initiatives
30

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 31

OPERATOR PM10
or our failure to generate revenue and corresponding profits from such activities and investments, could impact
our ability to perform necessary business operations, which could adversely affect our reputation, competitive
position, business, results of operations and financialcondition.
RISKS RELATING TO THE FOOD SERVICE INDUSTRY
The food service industry is affected by consumer preferences and perceptions. Changes in these
preferences and perceptions may lessen the demand for our doughnuts, which would reduce sales and
harm ourbusiness.
Food service businesses are often affected by changes in consumer tastes, national, regional and local
economic conditions and demographic trends. Individual store performance may be adversely affected by traffic
patterns, the cost and availability of labor, purchasing power, availability of products and the type, number
and location of competing stores. Our sales have been and may continue to be affected by changing consumer
tastes, such as health or dietary preferences that cause consumers to avoid doughnuts in favor of foods that are
perceived as healthier. Moreover, because we are primarily dependent on a single product, if consumer demand for
doughnuts should decrease, our business would suffer more than if we had a more diversifiedmenu.
The food service industry is affected by litigation, regulation and publicity concerning food quality,
health and other issues, which can cause customers to avoid our products and result inliabilities.
Food service businesses can be adversely affected by litigation, by regulation and by complaints from
customers or government authorities resulting from food quality, illness, injury or other health concerns or
operating issues stemming from one store or a limited number of stores, including stores operated by our
franchisees. In addition, class action lawsuits have been filed and may continue to be filed against various food
service businesses (including quick service restaurants) alleging, among other things, that food service businesses
have failed to disclose the health risks associated with high-fat foods and that certain food service business
marketing practices have encouraged obesity. Adverse publicity about these allegations may negatively affect us
and our franchisees, regardless of whether the allegations are true, by discouraging customers from buying our
products. Because one of our competitive strengths is the taste and quality of our doughnuts, adverse publicity or
regulations relating to food quality or other similar concerns affect us more than it would food service businesses
that compete primarily on other factors. We could also incur significant liabilities if such a lawsuit or claim results
in a decision against us or as a result of litigation costs regardless of theresult.
The food service industry is affected by food safety issues, including food tampering orcontamination.
Food safety, including the possibility of food tampering or contamination is a concern for any food service
business. Any report or publicity linking the Company or one of its franchisees to food safety issues, including
food tampering or contamination, could adversely affect our reputation as well as our revenues and profits. Food
safety issues could also adversely affect the price and availability of affected ingredients, which could result in
disruptions in our supply chain or lower margins for us and our franchisees. Additionally, food safety issues could
expose the Company to litigation or governmentalinvestigation.
The food service industry is affected by security risks for individually identifiable data of our guests,
web-site users, and teammembers.
We receive and maintain certain personal information about our guests, web-site users, and team members.
The use of this information by us is regulated by applicable law, as well as by certain third party contracts. If our
security and information systems are compromised or our business associates fail to comply with these laws and
regulations and this information is obtained by unauthorized person or used inappropriately, it could adversely
affect our reputation, as well as our operations, their results, and our financial condition. Additionally, we could
be subject to litigation or the imposition of penalties. As privacy and information security laws and regulations
change, we may incur additional costs to ensure we remain in compliance with these laws andregulations.
31
REVISION 4
TYPE Clean
JOB NUMBER 246088
SERIAL <12345678>
PAGE NO. 32

OPERATOR PM10
Our success depends on our ability to compete with many food servicebusinesses.
We compete with many well-established food service companies. At the retail level, we compete with other
doughnut retailers and bakeries, specialty coffee retailers, bagel shops, fast-food restaurants, delicatessens, takeout food service companies, convenience stores and supermarkets. At the wholesale level, we compete primarily
with grocery store bakeries, packaged snack foods and vending machine dispensers of snack foods. Aggressive
pricing by our competitors or the entrance of new competitors into our markets could reduce our sales and profit
margins. Moreover, many of our competitors offer consumers a wider range of products. Many of our competitors
or potential competitors have substantially greater financial and other resources than we do which may allow
them to react to changes in pricing, marketing and the quick service restaurant industry better than we can. As
competitors expand their operations, we expect competition to intensify. In addition, the start-up costs associated
with retail doughnut and similar food service establishments are not a significant impediment to entry into the
retail doughnut business. We also compete with other employers in our markets for hourly workers and may be
subject to higher laborcosts.
RISKS RELATING TO OWNERSHIP OF OUR COMMON STOCK
The market price of our common stock has been volatile and may continue to be volatile, and the value of
any investment maydecline.
The market price of our common stock has been volatile and may continue to be volatile. This volatility may
cause wide fluctuations in the price of our common stock, which is listed on the New York Stock Exchange. The
market price may fluctuate in response to many factorsincluding:

Changes in general conditions in the economy or the financialmarkets;

Variations in our quarterly operating results or our operating results failing to meet the expectations of
securities analysts or investors in a particularperiod;

Changes in financial estimates by securitiesanalysts;

Other developments affecting Krispy Kreme, our industry, customers or competitors; and

The operating and stock price performance of companies that investors deem comparable to KrispyKreme.
Our charter, bylaws and tax asset protection plan contain provisions that may make it more difficult or
expensive to acquire us in the future or may negatively affect our stockprice.
Our articles of incorporation, bylaws and tax asset protection plan contain several provisions that may make it
more difficult for a third party to acquire control of us without the approval of our board of directors. These provisions
may make it more difficult or expensive for a third party to acquire a majority of our outstanding voting common
stock. They may also delay, prevent or deter a merger, acquisition, tender offer, proxy contest or other transaction that
might otherwise result in our shareholders receiving a premium over the market price for their commonstock.
Item 1B.
UNRESOLVED STAFFCOMMENTS.
None.
Item 2.
PROPERTIES.
Stores. As of February 3, 2013, there were 748 Krispy Kreme stores systemwide, of which 97 were
Company stores and 651 were operated byfranchisees.

As of February 3, 2013, all of our Company stores, except our seven commissaries, had on-premises sales,
and 43 of our Company factory stores also engaged in wholesalesales.

Of the 97 Company stores in operation as of February 3, 2013, we owned the land and building for
42stores, we owned the building and leased the land for 23 stores, leased both the land and building for
9stores and leased space for 23 in-line and end caplocations.
32
REVISION 4
TYPE Clean
JOB NUMBER 246088
SERIAL <12345678>
PAGE NO. 33

OPERATOR PM10
KK Supply Chain facilities. We own a 150,000 square foot facility in Winston-Salem, North Carolina,
which houses our doughnut mix plant. This facility also houses a commissary serving wholesale customers that
was opened late in fiscal 2012. We own another 105,000 square foot facility in Winston-Salem which we use
primarily as our equipment manufacturing facility, but which also contains our research and development and
trainingfacilities.
Other properties. Our corporate headquarters is located in Winston-Salem, North Carolina. We lease
the entire 86,000 square feet of this facility under a lease that expires on November 30, 2026, with two five-year
renewaloptions.
Substantially all of the Companys fee simple and leasehold interest in real properties are pledged as
collateral for the Companys secured creditfacilities.
Item 3.
LEGALPROCEEDINGS.
Pending Matters
Except as disclosed below, the Company currently is not a party to any material legalproceedings.
K Asia Litigation
On April 7, 2009, a Cayman Islands corporation, K 2 Asia Ventures, and its owners filed a lawsuit in Forsyth
County, North Carolina Superior Court against the Company, its franchisee in the Philippines, and other persons
associated with the franchisee. The suit alleges that the Company and the other defendants conspired to deprive
the plaintiffs of claimed exclusive rights to negotiate franchise and development agreements with prospective
franchisees in the Philippines, and seeks unspecified damages. The Company believes that these allegations are
false and intends to vigorously defend against thelawsuit.
Colchester Security Litigation
On January 27, 2012, Colchester Security II, LLC, the Companys former landlord in Lorton, Virginia, filed
a state court suit against the Company in the Circuit Court of Fairfax County, Virginia, alleging breach of the lease
and negligence resulting in property damage at a commissary facility previously operated by the Company. The
plaintiff seeks $2.7million in damages. The Company denies the allegations and intends to pursue counterclaims
of approximately $3million relating to indemnity claims and breach of the lease. In March 2013, both parties
agreed to avail themselves of the Fairfax County Courts alternate dispute resolution program, and now the matter
has been set for binding arbitration to occur in late June2013.
Other Legal Matters
The Company also is engaged in various legal proceedings arising in the normal course of business. The
Company maintains customary insurance policies against certain kinds of such claims and suits, including
insurance policies for workers compensation and personal injury, some of which provide for relatively large
deductibleamounts.
Item 4.
MINE SAFETYDISCLOSURES.
Notapplicable.
33
REVISION 4
TYPE Clean
JOB NUMBER 246088
SERIAL <12345678>
PAGE NO. 34

OPERATOR PM10
PART II
Item 5.
MARKET FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER

MATTERS AND ISSUER PURCHASES OF EQUITYSECURITIES.
Market Information
Our common stock is listed on the NYSE under the symbol KKD. The following table sets forth the
high and low sales prices for our common stock in composite trading as reported by the NYSE for the fiscal
periodsshown.
Year Ended January 29,2012:
First Quarter. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Second Quarter. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Third Quarter. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Fourth Quarter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Year Ended February 3,2013:
First Quarter. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Second Quarter. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Third Quarter. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Fourth Quarter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
High
Low
$ 7.45
10.08
9.47
7.84
$5.10
5.27
5.78
6.20
$ 8.77
7.54
8.23
13.19
$ 6.69
5.86
5.96
6.77
Holders
As of March 22, 2013, there were approximately 15,500 shareholders of record of our commonstock.
Dividends
We did not pay any cash dividends in fiscal 2013 or fiscal 2012. Because we intend to invest significant
amounts of cash in assets and activities we believe will grow our business and generate significant earnings over
the long term, we do not anticipate paying regular cash dividends in the foreseeable future. Furthermore, the terms
of our secured credit facilities impose significant limitations on the payment of dividends on, and redemptions of,
our common stock. Pursuant to an authorization by our Board of Directors, and with the consent of our lenders,
in fiscal 2013 we repurchased in open market transactions approximately 3,113,000 of our common shares for
an aggregate purchase price of approximately $20 million, an average price of $6.42 per share. We may make
additional share repurchases or distribute cash to our shareholders in the future if we conclude doing so is in our
shareholders bestinterests.
Recent Sales of Unregistered Securities
None.
Purchases of Equity Securities
No purchases were made by or on behalf of the Company of its equity securities during the fourth quarter of
fiscal2013.
34
REVISION 4
SERIAL <12345678>
TYPE Clean
JOB NUMBER 246088
PAGE NO. 35

OPERATOR PM10
Stock Performance Graph

The performance graph shown below compares the percentage change in the cumulative total shareholder
return on our common stock against the cumulative total return of the NYSE Composite Index and Standard &
Poors Restaurants Index for the period from February 3, 2008 through February 3, 2013. The graph assumes an
initial investment of $100 and the reinvestment ofdividends.
Comparison of Cumulative Total Return
500
DOLLARS
400
300
200
100
0
2008
2009
2010
Krispy Kreme Doughnuts, Inc.
2011
NYSE Composite Index
2012
2013
S&P 500 Restaurants Index
February 3, February 1, January 31, January 30, January 29, February 3,

2008
2009
2010
2011
2012
2013
Krispy Kreme Doughnuts,Inc. . . . . . . . . . . .
$100.00
$48.10
$ 97.58
$221.11
$264.71
$449.13
NYSE Composite Index. . . . . . . . . . . . . . . . .
100.00
56.00
74.20
86.90
84.90
96.63
S&P 500 Restaurants Index. . . . . . . . . . . . . .
100.00
95.21
117.99
151.30
212.56
222.14
35

JOB NUMBER 246088
Item 6.
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 36

OPERATOR PM10
SELECTED FINANCIALDATA.
The following selected financial data should be read in conjunction with Item 7, Managements Discussion
and Analysis of Financial Condition and Results of Operations, and the Companys consolidated financial
statements appearing elsewhere herein. The Companys fiscal year ends on the Sunday closest to January 31,
which periodically results in a 53-week year. Fiscal 2013 contained 53weeks.
Year Ended
February 3, January 29, January 30, January 31, February 1,
2013
2012
2011
2010
2009
(In thousands, except per share and number of storesdata)
STATEMENT OF OPERATIONSDATA:
Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operatingexpenses:
Direct operating expenses (exclusive of
depreciationand amortization expense
shownbelow) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
General and administrative expenses . . . . . . . . . . . . .
Depreciation and amortization expense . . . . . . . . . . .
Impairment charges and lease termination costs . . . . .
Operating income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Loss on refinancing of debt . . . . . . . . . . . . . . . . . . . . . . .
Equity in income (losses) of equity method franchisees . . .
Gain on sale of interest in equity method franchisee . . . .
Other non-operating income and (expense), net . . . . . . .
Income (loss) before income taxes . . . . . . . . . . . . . . . . . .
Provision for income taxes . . . . . . . . . . . . . . . . . . . . . . . .
Net income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Earnings (loss) per commonshare:
Basic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Diluted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$435,843 $ 403,217 $361,955 $346,520 $385,522
362,828
346,434 313,475 297,859 348,044
25,089
22,188
21,870
22,793
23,460
9,891
8,235
7,389
8,191
8,709
306
793
4,066
5,903
548
37,729
25,567
15,155
11,774
4,761
114
166
207
93
331
(1,642)
(1,666)
(6,359) (10,685) (10,679)
(1,022)
(202)
(122)
547
(488)
(786)
6,198
317
215
329
(276)
2,815
36,316
30,358
8,857
418
(3,558)
15,537 (135,911)
1,258
575
503
$ 20,779 $ 166,269 $ 7,599 $ (157) $ (4,061)
$
$
0.31 $
0.30 $
2.40 $
2.33 $
0.11 $
0.11 $
$
$
(0.06)
(0.06)
BALANCE SHEET DATA (AT END OFYEAR):

Working capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 88,108 $ 55,722 $ 22,576 $ 21,550 $ 36,190
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 341,938
334,948 169,926 165,276 194,926
Long-term debt, less current maturities . . . . . . . . . . . . . .
23,595
25,369
32,874
42,685
73,454
Total shareholders' equity . . . . . . . . . . . . . . . . . . . . . . . . . 246,432
249,126
76,428
62,767
57,755
Number of stores at end ofyear:
Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
97
92
85
83
93
Franchise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
651
602
561
499
430
Systemwide . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
748
694
646
582
523
36

JOB NUMBER 246088
Item7.
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 37

OPERATOR PM10
MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND

RESULTS OFOPERATIONS.
The following tables set forth operating metrics with respect to the Krispy Kreme stores operated by the
Company (all of which are located in the United States) and the stores operated by the Companys domestic and
internationalfranchisees.
The Companys fiscal year ends on the Sunday closest to January 31, which periodically results in a 53-week
year. Fiscal 2013 included 53 weeks. Operating metrics in the table below for fiscal 2013 are presented for the
52weeks ended January 27, 2013 in order to enhance comparability of the fiscal 2013 metrics with those for fiscal
2012 and 2011, each of which contained 52weeks.
Change in Same Store Sales (on-premises salesonly):

Company stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Domestic Franchise stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
International Franchise stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
International Franchise stores, in constant dollars (1) . . . . . . . . . . . . . . . . .
January 27,
2013
Change in Same Store Customer Count - Company stores

(retail salesonly) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Average Guest Check - Company stores (retail salesonly) . . . . . . . . . . . . . $
Wholesale Metrics (Company storesonly):
Average weekly number of doorsserved:
Grocers/mass merchants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Convenience stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Average weekly sales perdoor:
Grocers/mass merchants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Convenience stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5.5%
6.8
(9.0)
(8.1)
5.2%
6.6
(6.4)
(10.8)
4.0%
4.5
(8.8)
(13.9)
7.1%
0.6%
1.8%
7.29
5,582
4,517
319
248
Systemwide Sales (in thousands): (2)

Company stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $288,079
Domestic Franchise stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 281,334
International Franchise stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 423,418
International Franchise stores, in constant dollars (3) . . . . . . . . . . . . . . . . . 423,418
Average Weekly Sales Per Store (in thousands): (4) (5)
Companystores:
Factorystores:
Commissaries wholesale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Dual-channelstores:
On-premises . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Wholesale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
On-premises only stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
All factory stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Satellite stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
All stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
52 Weeks Ended
January 29, January 30,
2012
2011
181.6
7.36
5,814
4,822
$
293
228
7.06
5,664
5,122
$
260
206
$269,676
261,979
383,508
380,028
$244,324
238,890
325,192
336,469
34.0
45.7
79.7
35.0
71.0
20.1
59.8
199.3
32.0
45.6
77.6
32.5
69.4
19.9
59.5
175.3
30.2
42.0
72.2
30.7
64.6
18.6
56.9
Domestic Franchisestores:
Factory stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
48.2
16.7
43.9
16.5
40.4
12.2
International Franchisestores:
Factory stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
41.0
11.3
43.4
10.9
42.3
9.1
37

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 38

OPERATOR PM10
(1) Represents the change in International Franchise same store sales computed by reconverting franchise store
sales in each foreign currency to U.S. dollars at a constant rate of exchange for eachperiod.
(2) Excludes sales among Company and franchise stores. Systemwide sales is a non-GAAPmeasure.
(3) Represents International Franchise store sales computed by reconverting International Franchise store sales for
the year ended January 29, 2012 and January 30, 2011 to U.S. dollars based upon the weighted average of the
exchange rates prevailing in the year ended February 3,2013.
(4) Includes sales between Company and franchisestores.
(5) Metrics reflect only stores open at the respective periodend.
The change in same store sales is computed by dividing the aggregate on-premises sales (including
fundraising sales) during the current year period for all stores which had been open for more than 56 consecutive
weeks during the current year (but only to the extent such sales occurred in the 57th or later week of each stores
operation) by the aggregate on-premises sales of such stores for the comparable weeks in the preceding year. Once
a store has been open for at least 57 consecutive weeks, its sales are included in the computation of same store
sales for all subsequent periods. In the event a store is closed temporarily (for example, for remodeling) and has
no sales during one or more weeks, such stores sales for the comparable weeks during the earlier or subsequent
period are excluded from the same store sales computation. The change in same store customer count is similarly
computed, but is based upon the number of retail transactions reported in the Companys point-of-sale system.
For wholesale sales, average weekly number of doors represents the average number of customer locations
to which product deliveries were made during a week, and average weekly sales per door represents the average
weekly sales to each such location.
Systemwide sales, a non-GAAP financial measure, include sales by both Company and franchise Krispy
Kreme stores. The Company believes systemwide sales data are useful in assessing consumer demand for the
Companys products, the overall success of the Krispy Kreme brand and, ultimately, the performance of the
Company. All of the Companys royalty revenues are computed as percentages of sales made by the Companys
domestic and international franchisees, and substantially all of KK Supply Chains external sales of doughnut
mixes and other ingredients ultimately are determined by demand for the Companys products at franchise stores.
Accordingly, sales by the Companys franchisees have a direct effect on the Companys royalty and KK Supply
Chain revenues, and therefore on the Companys profitability. The Companys consolidated financial statements
appearing elsewhere herein include sales by Company stores, sales to franchisees by the KK Supply Chain
business segment, and royalties and fees received from franchise stores based on their sales, but exclude sales by
franchise stores to their customers.
38

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 39

OPERATOR PM10
The following table sets forth data about the number of systemwide stores as of February 3, 2013,
January29,2012 and January 30, 2011.
Number of Stores Open At Year End:

Company stores:
Factory:
Commissaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Dual-channel stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
On-premises only stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Satellite stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total Company stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
February 3,
2013
January 29,
2012
January 30,
2011
7
36
33
21
97
7
35
30
20
92
6
35
28
16
85
Domestic Franchise stores:

Factory stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total Domestic Franchise stores . . . . . . . . . . . . . . . . . . . . . . . . .
99
43
142
102
40
142
102
42
144
International Franchise stores:

Factory stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total international franchise stores . . . . . . . . . . . . . . . . . . . . . . .
120
389
509
118
342
460
106
311
417
Total systemwide stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
748
694
646
The following table sets forth data about the number of store operating weeks for the 52-weeks ended
January 27, 2013, January 29, 2012 and January 30, 2011.
January 27,
2013
52 Weeks Ended
January 29,
2012
January 30,
2011
Store Operating Weeks:

Company stores:
Factory stores:
Commissaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Dual-channel stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
On-premises only stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Satellite stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
364
1,842
1,623
1,062
315
1,820
1,519
913
316
1,820
1,456
786
Domestic Franchise stores: (1)

Factory stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4,910
2,078
5,168
1,884
5,275
1,985
International Franchise stores: (1)

Factory stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5,224
17,724
4,717
15,870
4,305
14,581
(1) Metrics reflect only stores open at the respective period end.
39

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 40

OPERATOR PM10
FISCAL 2013 COMPARED TO FISCAL 2012

The following discussion of the Companys results of operations should be read in conjunction with the
consolidated financial statements and notes thereto appearing elsewhere herein.
Matters Affecting Comparability
The Companys fiscal year ends on the Sunday closest to January 31, which periodically results in a
53-week year. The year ended February 3, 2013 included 53 weeks, compared to 52 weeks for the year ended
January29,2012. Accordingly, financial results for fiscal 2013 are not directly comparable to those of fiscal 2012.
Additionally, the Companys provision for income taxes, net income and earnings per share for fiscal 2013
are not comparable to the corresponding amounts for fiscal 2012 as a result of the reversal of valuation allowances
on deferred tax assets in the fourth quarter of fiscal 2012 and the resulting increase in income tax expense in
fiscal 2013. The Company has substantial net operating loss carryforwards and, accordingly, the Companys cash
payments for income taxes, which were not affected by the reversal of the valuation allowance on deferred tax
assets, are expected to remain insignificant for the foreseeable future. See Results of Operations Fiscal 2013
Compared to Fiscal 2012 - Provision for Income Taxes below, and Note 3 to the consolidated financial statements
appearing elsewhere herein.
Finally, in the second quarter of fiscal 2012, the Company recognized a gain of approximately $6.2 million
on the sale of its 30% equity interest in KK Mexico (approximately $4.7 million after deduction of approximately
$1.5 million of Mexican taxes payable on the transaction), as described in Note 8 to the consolidated financial
statements appearing elsewhere herein. Such gains should not be expected to occur regularly.
Management evaluates the Companys results of operations using, among other measures, adjusted net
income and adjusted earnings per share, which include the provision for income taxes only to the extent such taxes
are currently payable in cash. In addition, management excludes from adjusted net income charges and credits that
are unusual and infrequently occurring. Management believes adjusted net income and adjusted earnings per share
are useful performance measures because they more closely measure the cash flows generated by the Companys
operations and the trends in those cash flows than do GAAP net income and earnings per share, and because they
exclude the effects of transactions that are not indicative of the Companys ongoing results of operations.
Adjusted net income and adjusted earnings per share are non-GAAP measures.
The following presentation of adjusted net income, and the related reconciliation of adjusted net income
to GAAP net income and presentation of adjusted earnings per share, are intended to (1) assist the reader in
understanding the effects of the reversal of the valuation allowance and the non-recurring gain on the sale of the
interest in KK Mexico on the Companys results of operations for fiscal 2012; (2) facilitate comparisons of fiscal
2013 results with the Companys results for fiscal 2012; and (3) illustrate the material difference between the
Companys income tax expense and income taxes currently payable. These non-GAAP performance measures are
40

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 41

OPERATOR PM10
consistent with other measurements made by management in the operation of the business which do not consider
income taxes except to the extent to which those taxes currently are payable, for example, capital allocation
decisions and incentive compensation measurements that are made on a pretax basis.
Year Ended
February 3,
January 29,
2013
2012
(In thousands,
except per share amounts)
Net income, as reported . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Provision for deferred income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Gain on sale of interest in KK Mexico (net of income taxes of $1,492) . . . . . . . . . . . . .
Adjusted net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$20,779
13,413
$34,192
$ 166,269
(139,403)
(4,706)
$ 22,160
Adjusted earnings per common share:

Basic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Diluted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
$
$
$
Weighted average shares outstanding:

Basic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Diluted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
0.51
0.49
67,624
69,896
0.32
0.31
69,145
71,497
Overview
Total revenues rose to $435.8 million in fiscal 2013 compared to $403.2 million in fiscal 2012. Excluding the
53rd week, total revenues rose 5.9% to $426.8 million.
Consolidated operating income increased to $37.7 million in fiscal 2013 (of which approximately $1.3million
relates to the 53rd week) from $25.6 million in fiscal 2012. Consolidated net income was $20.8 million compared
to $166.3 million. Consolidated net income for fiscal 2012 included an unusual credit of $139.6 million from
the reversal of valuation allowances on deferred tax assets and a $4.7 million after-tax gain on the sale of the
Companys 30% equity interest in KK Mexico. See Matters Affecting Comparability above.
41

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 42

OPERATOR PM10
Revenues by business segment (expressed in dollars and as a percentage of total revenues) are set forth in the
table below (percentage amounts may not add to totals due to rounding).
Year Ended
February 3,
January 29,
2013
2012
(Dollars in thousands)
Revenues by business segment:

Company Stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Domestic Franchise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
International Franchise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
KK Supply Chain:
Total revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less - intersegment sales elimination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
External KK Supply Chain revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 296,494
10,325
24,941
$ 271,657
9,463
22,621
215,412
(111,329)
104,083
$ 435,843
206,453
(106,977)
99,476
$ 403,217
Segment revenues as a percentage of total revenues:

Company Stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
KK Supply Chain (external sales) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating income:
Company Stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
KK Supply Chain . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total segment operating income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Unallocated general and administrative expenses
(including depreciation and amortization expense) . . . . . . . . . . . . . . . . . . . . . . .
Impairment charges and lease termination costs . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Consolidated operating income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
68.0%
2.4
5.7
23.9
100.0%
$
8,534
5,590
17,387
32,450
63,961
(25,926)
(306)
$ 37,729
67.4%
2.3
5.6
24.7
100.0%
$
284
3,737
15,054
30,160
49,235
(22,875)
(793)
$ 25,567
A discussion of the revenues and operating results of each of the Companys four business segments follows,
together with a discussion of income statement line items not associated with specific segments.
42

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 43

OPERATOR PM10
Company Stores
The components of Company Stores revenues and expenses (expressed in dollars and as a percentage of total
revenues) are set forth in the table below (percentage amounts may not add to totals due to rounding).
Year Ended
February 3,
January 29,
2013
2012
(In thousands)
Revenues:
On-premises sales:
Retail sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Fundraising sales . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total on-premises sales . . . . . . . . . . . . . . . . . . .
Wholesale sales:
Grocers/mass merchants . . . . . . . . . . . . . . . . . . . . .
Convenience stores . . . . . . . . . . . . . . . . . . . . . . . . .
Other wholesale . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total wholesale sales . . . . . . . . . . . . . . . . . . . . .
Total revenues . . . . . . . . . . . . . . . . . . . . . . .
Operating expenses:
Cost of sales:
Food, beverage and packaging . . . . . . . . . . . . . . . .
Shop labor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Delivery labor . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Employee benefits . . . . . . . . . . . . . . . . . . . . . . . . . .
Total cost of sales . . . . . . . . . . . . . . . . . . . . . . . .
Vehicle costs (1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Occupancy (2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Utilities expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Depreciation expense . . . . . . . . . . . . . . . . . . . . . . . . . .
Other operating expenses . . . . . . . . . . . . . . . . . . . . . . .
Total store level costs . . . . . . . . . . . . . . . . . . . . . . .
Store operating income . . . . . . . . . . . . . . . . . . . . . . . . .
Other segment operating costs (3) . . . . . . . . . . . . . . . . .
Allocated corporate overhead . . . . . . . . . . . . . . . . . . . .
Segment operating income . . . . . . . . . . . . . . . . .
$127,989
14,929
142,918
$ 111,701
14,302
126,003
93,384
56,972
3,220
153,576
296,494
87,654
54,961
3,039
145,654
271,657
111,205
53,210
24,222
20,889
209,526
17,336
9,901
5,993
8,142
20,429
271,327
25,167
12,333
4,300
$ 8,534
105,216
50,202
23,044
18,992
197,454
17,228
9,240
5,779
6,593
18,581
254,875
16,782
11,998
4,500
$
284
Percentage of
Total Revenues
Year Ended
February 3,
January 29,
2013
2012
43.2%
5.0
48.2
31.5
19.2
1.1
51.8
100.0
37.5
17.9
8.2
7.0
70.7
5.8
3.3
2.0
2.7
6.9
91.5
8.5
4.2
1.5
2.9%
41.1%
5.3
46.4
32.3
20.2
1.1
53.6
100.0
38.7
18.5
8.5
7.0
72.7
6.3
3.4
2.1
2.4
6.8
93.8
6.2
4.4
1.7
0.1%
(1) Includes fuel, maintenance and repairs, rent, taxes and other costs of operating the delivery fleet, exclusive of
depreciation.
(2) Includes rent, property taxes, common area maintenance charges, insurance, building maintenance and other
occupancy costs, exclusive of utilities and depreciation.
(3) Includes marketing costs not charged to stores, segment management costs, wholesale selling expenses and
support functions.
43

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 44

OPERATOR PM10
A reconciliation of Company Stores segment sales from fiscal 2012 to fiscal 2013 follows:
Sales for the year ended January 29, 2012 . . . . . . . . . . . . . . . . . . . . . . . . .

Fiscal 2012 sales at closed stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Fiscal 2013 sales at closed stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Increase in sales at established stores (open stores only) . . . . . . . . . . . . . .
Increase in sales at stores opened in fiscal 2012 . . . . . . . . . . . . . . . . . . . .
Sales at stores opened in fiscal 2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Sales at stores acquired in fiscal 2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Sales for the year ended February 3, 2013 . . . . . . . . . . . . . . . . . . . . . . . . .
On-Premises
Wholesale
(In thousands)
Total
$126,003
(723)
741
9,565
3,077
3,143
1,112
$142,918
$145,654
7,471
451
$153,576
$271,657
(723)
741
17,036
3,077
3,143
1,563
$296,494
Sales at Company Stores increased to $296.5 million in fiscal 2013 from $271.7 million in fiscal 2012.
Excluding the 53rd week, sales increased 6.9% to $290.3 million. Selling price increases in the on-premises
and wholesale distribution channels accounted for approximately 1.2 percentage points of the increase in sales,
exclusive of the effects of higher pricing on unit volumes; such effects are difficult to measure reliably. As with all
consumer products, however, higher prices may negatively affect sales. The Company believes this phenomenon
is more pronounced in the wholesale channel where competing products are merchandised alongside those of
theCompany.
The following table presents sales metrics for Company stores:
52 Weeks Ended
January 27,
January 29,
2013
2012
ON-PREMISES:
Change in same store sales
Change in same store customer count (retail sales only)
Average guest check (retail sales only)
WHOLESALE:
Grocers/mass merchants:
Change in average weekly number of doors
Change in average weekly sales per door
Convenience stores:
Change in average weekly number of doors
Change in average weekly sales per door
5.5%
7.1%
$7.29
5.2%
0.6%
$7.36
(4.0)%
8.9%
2.6%
12.7%
(6.3)%
8.8%
(5.9)%
10.7%
On-premises sales
The components of the change in same store sales at Company stores are as follows:
Change in same store sales attributable to:

Retail pricing
Guest check average (exclusive of the effects of pricing)
Customer count
Other
Total
44
52 Weeks Ended
January 27,
January 29,
2013
2012
0.7%
(1.4)
6.2
0.0
5.5%
7.4%
(2.9)
0.5
0.2
5.2%

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 45

OPERATOR PM10
On-premises sales increased to $142.9 million in fiscal 2013 compared to $126.0 million in fiscal 2012.
Excluding the 53rd week, on-premises sales increased 10.9% to $139.8 million. The Company is developing and
implementing new and enhanced marketing programs designed to increase guest visit frequency. In addition to
improved marketing programs, management believes that customer traffic has been positively affected by ongoing
store remodelings, an emphasis on hospitality, and continued use of creative limited time doughnut offerings.
Additionally, approximately 0.7 percentage points of the sales increase reflects retail price increases implemented
in the first quarter of fiscal 2012. On March 7, 2011, the Company implemented price increases at substantially
all its stores designed to help offset the rising costs of doughnut mixes, other ingredients and fuel resulting from
higher commodity prices. These price increases affected items comprising approximately 60% of on-premises
sales, and the average price increase on these items was approximately 14%.
On February 18, 2013, the Company implemented on-premises price increases averaging approximately 3%
in its Company shops.
Higher customer traffic was the principal driver of the improvement in same store sales, although
cannibalization and honeymoon effects of new stores in expansion markets dampened somewhat the gain in
same store customer count in fiscal 2013. Cannibalization effect means the tendency for new stores to become
successful, in part or in whole, by shifting sales from existing stores in the same market. Honeymoon effect
means the common pattern for many start-up restaurants in which a flurry of activity due to start-up publicity and
natural curiosity is followed by a decline during which a steady repeat customer base develops.
Wholesale distribution
Sales to wholesale accounts increased to $153.6 million in fiscal 2013 compared to $145.7 in fiscal 2012.
Excluding the 53rd week, sales to wholesale accounts increased 3.3% to $150.5 million. Approximately 1.4
percentage points of the sales increase is due to price increases. The Company started implementing price
increases for some products offered in the wholesale channel late in the first quarter of fiscal 2012, and
substantially completed implementing the increases during the second quarter. Those price increases affected
products comprising approximately 60% of wholesale sales, and the average price increase on those products
was approximately 11%. The Company currently plans to implement modest price increases in the wholesale
distribution channel in the second or third quarter of fiscal 2014.
Sales to grocers and mass merchants increased to $93.4 million in fiscal 2013 compared to $87.7 million in
fiscal 2012. Excluding the 53rd week, sales to grocers and mass merchants increased 4.4%, with an 8.9% increase
in average weekly sales per door partially offset by a 4.0% decline in the average number of doors served. The
decline in the average number of doors served in the grocery/mass merchant channel reflects, among other things,
store closures by a regional grocery store customer as well as the elimination of loose doughnut sales at another
regional grocer, although the Company continues to sell packaged products to this customer. Sales of loose
unpackaged products comprised approximately 2% of sales to grocery/mass merchant customers for fiscal 2013,
with the balance comprised of sales of packaged products.
Convenience store sales increased to $57.0 million in fiscal 2013 compared to $55.0 million in fiscal 2012.
Excluding the 53rd week, sales to convenience stores increased 1.6%, reflecting an 8.8% increase in the average
weekly sales per door partially offset by a 6.3% decline in the average number of doors served. The decline in the
average number of doors served in the convenience store channel reflects, among other things, a reduction in the
number of stops at relatively low volume doors, as well as the loss of a regional convenience store account. Sales of
loose unpackaged products comprised approximately 80% of sales to convenience store customers for fiscal 2013,
with the balance comprised of sales of packaged products.
Costs and expenses
Total cost of sales as a percentage of revenues declined by 2.0 percentage points from 72.7% in fiscal 2012 to
70.7% of revenues in fiscal 2013.
45

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 46

OPERATOR PM10
The cost of food, beverage and packaging as a percentage of revenues decreased by 1.2 percentage points
in fiscal 2013 compared to fiscal 2012. The aggregate purchase price increases for food, beverage and packaging
were very slight. The decline in food, beverage and packaging as a percentage of revenues reflects improved
materials consumption and a greater percentage of sales derived from on-premises customers compared to fiscal
2012, and lower product returns on wholesale distribution.
The Companys Supply Chain has entered into contracts to purchase approximately half of its flour
requirements for fiscal 2014, together with approximately 70% of its shortening requirements, and all of its
estimated sugar requirements. Based upon current market forecasts, the Company expects its aggregate cost of
ingredients and packaging to rise modestly in fiscal 2014 compared to fiscal 2013, and expects to recover these
higher costs through price increases or cost reduction measures. The Companys contracts for sugar also cover
substantially all of its estimated fiscal 2015 requirements.
Shop labor as a percentage of revenues declined by 0.6 percentage points from fiscal 2012 to 17.9% of
revenues in fiscal 2013, principally due to higher revenues and improved labor cost management.
Vehicle costs as a percentage of revenues decreased from 6.3% of revenues in fiscal 2012 to 5.8% of revenues
in fiscal 2013, principally due to higher sales resulting from price increases and lower fuel costs due to a reduction
in mileage due to the reduction in the number of wholesale doors served.
Many segment operating costs are fixed or semi-fixed in nature and, accordingly, segment profit margins are
sensitive to changes in sales volumes.
The Company is self-insured for workers compensation, vehicle and general liability claims, but maintains
stop-loss coverage for individual claims exceeding certain amounts. The Company provides for claims under these
self-insured programs using actuarial methods as described in Note 1 to the consolidated financial statements
appearing elsewhere herein, and periodically updates actuarial valuations of its self-insurance reserves at least
annually. Such periodic actuarial valuations result in changes over time in the estimated amounts which ultimately
will be paid for claims under these programs to reflect the Companys actual claims experience for each policy
year as well as trends in claims experience over multiple years. Such claims, particularly workers compensation
claims, often are paid over a number of years following the year in which the insured events occur, and the
estimated ultimate cost of each years claims accordingly is adjusted over time as additional information becomes
available. As a result of the periodic update of its actuarial valuation, the Company recorded favorable adjustments
for changes in estimates to its self-insurance claims liabilities related to prior policy years of approximately
$730,000 in fiscal 2013, of which $360,000 was recorded in the fourth quarter, and $1.3 million in 2012, of which
$830,000 million was recorded in the fourth quarter. The $730,000 in favorable adjustments recorded in fiscal
2013 includes an unfavorable adjustment relating to workers compensation liability claims of approximately
$10,000 included in employee benefits in the table above, a favorable adjustment relating to vehicle liability claims
of approximately $390,000 included in vehicle costs, and a favorable adjustment relating to general liability claims
of approximately $275,000 included in other operating costs. An additional $75,000 of favorable adjustments was
recorded in other segments of the business. The $1.3 million in favorable adjustments recorded in fiscal 2012
includes favorable adjustments of $1.1 million relating to workers compensation liability claims, $40,000 relating
to vehicle liability claims and $180,000 relating to general liability claims.
Depreciation expense increased in fiscal 2013 to 2.7% of revenues from 2.4% in fiscal 2012 due to increased
capital expenditures in fiscal 2012 and 2013 including construction of new stores, store refurbishment efforts on
existing stores and investments in information technology systems.
The Patient Protection and Affordable Care Act (the Act) requires businesses employing fifty or more fulltime equivalent employees to offer health care benefits to those full-time employees beginning in January 2014, or
be subject to an annual penalty. Those benefits must be provided under a health care plan which provides a certain
minimum scope of health care services. The Act limits the portion of the cost of the benefits which the Company
can require employees to pay.
46

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 47

OPERATOR PM10
The Company currently employs a substantial number of persons to whom the Company does not currently
provide health care benefits but who could be entitled to receive health care benefits under the Act. The Company
does not know the amount by which its costs will increase assuming the above provisions of the Act are
implemented in January 2014 because, among other reasons, many of the specifics relating to implementation,
including certain of the specifics of the coverage required to be offered, are to be contained in regulations which
have not yet been drafted. In addition, the Company does not know how many of the potentially newly-eligible
employees will elect to obtain coverage under the Act.
However, based on information currently available to the Company and the Companys analyses to-date
and its current cost estimates, management currently does not expect that the aggregate incremental cost of
providing health care coverage prescribed by the Act will exceed its current costs by more than approximately
$5 million annually. The Company currently believes its incremental costs will be less than such amount, and
may be substantially less. The Company is continuing to study and evaluate the requirements of the Act, and the
Companys estimate of the additional cost of providing benefits mandated by the Act is expected to change as the
Company gains additional information and makes decisions affecting its implementation of the Acts requirements.
Domestic Franchise
Year Ended
February 3,
January 29,
2013
2012
(In thousands)
REVENUES:
Royalties
Development and franchise fees
Other
Total revenues
$ 9,672
288
365
10,325
$8,675
355
433
9,463
OPERATING EXPENSES:
Segment operating expenses
Depreciation expense
Allocated corporate overhead
Total operating expenses
SEGMENT OPERATING INCOME
4,171
164
400
4,735
$ 5,590
5,107
219
400
5,726
$3,737
Domestic Franchise revenues were $10.3 million in fiscal 2013 compared to $9.5 million in fiscal 2012.
Excluding the 53rd week, Domestic Franchise revenues increased 6.5% to $10.1 million. On a 52-week basis, the
increase reflects higher domestic royalty revenues resulting from an increase in sales by domestic franchise stores
from $262 million in fiscal 2012 to $281 million in fiscal 2013 partially offset by a reduction in other franchise
revenue. Domestic Franchise same store sales rose 6.8% in fiscal 2013.
Domestic Franchise operating expenses include costs to recruit new domestic franchisees, to assist in
domestic store openings, and to monitor and aid in the performance of domestic franchise stores, as well as
allocated corporate costs. Domestic Franchise operating expenses in fiscal 2012 included a provision of $820,000
for payments under a lease guarantee associated with a franchisee whose franchise agreements the Company
terminated. This provision was partially offset by the reversal of a previously recorded accrual of $110,000 related
to a franchisee lease guarantee as a result of the Company receiving a release from the related guarantee during
fiscal 2012. The decrease in Domestic Franchise operating expenses also reflects a decline in legal and trademark
protection costs of approximately $250,000, of which approximately $160,000 is related to the fiscal 2012
franchisee termination.
During the fourth quarter of fiscal 2013, the Company added new personnel to the Domestic Franchise
segment and in fiscal 2014 expects to incur additional franchise marketing costs in connection with managements
plan to reengage in franchise expansion efforts to drive domestic franchise unit growth.
47

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 48

OPERATOR PM10
Domestic franchisees opened nine stores and closed seven stores in fiscal 2013. On August 30, 2012, the
Company acquired two Krispy Kreme stores from one of its domestic franchisees as more fully described in
Note 21 to the consolidated financial statements appearing elsewhere herein. As of February 3, 2013, existing
development and franchise agreements for territories in the United States provide for the development of 54
additional stores through fiscal 2018. Royalty revenues are directly related to sales by franchise stores and,
accordingly, the success of franchisees operations has a direct effect on the Companys revenues, results of
operations and cash flows.
International Franchise
Year Ended
February 3,
January 29,
2013
2012
(In thousands)
REVENUES:
Royalties
Development and franchise fees
Total revenues
$23,336
1,605
24,941
$21,308
1,313
22,621
OPERATING EXPENSES:
Segment operating expenses
Total operating expenses
6,344
10
1,200
7,554
$17,387
6,261
6
1,300
7,567
$15,054
International Franchise royalties were $23.3 million in fiscal 2013 compared to $21.3 million in fiscal
2012. Excluding the 53rd week, International Franchise royalties increased 7.5%, driven by an increase in sales
by international franchise stores from $384 million in fiscal 2012 to $423 million in fiscal 2013 (measured on
a 52-week basis). Changes in the rates of exchange between the U.S. dollar and the foreign currencies in which
the Companys international franchisees do business decreased sales by international franchisees measured
in U.S. dollars by approximately $3.9 million in fiscal 2013 compared to fiscal 2012, which adversely affected
international royalty revenues by approximately $230,000.
Royalties and franchise fees in fiscal 2012 included approximately $280,000 and $95,000, respectively, of
amounts relating to the Companys franchisee in Mexico which were accrued in prior periods but which had not
previously been reported as revenue because of uncertainty surrounding their collection. Such amounts were
reported as revenue in recognition of the payment of such amounts to the Company on May 5, 2011, in connection
with the Companys sale of its 30% equity interest in the franchisee, as more fully described in Note 8 to the
consolidated financial statements appearing elsewhere herein.
International Franchise same store sales, measured on a constant currency basis to remove the effects of
changing exchange rates between foreign currencies and the U.S. dollar (constant dollar same store sales), fell
8.1%. The decline in International Franchise same store sales reflects, among other things, waning honeymoon
effects from the large number of new stores opened internationally in recent years and the cannibalization effects
on initial stores in new markets of additional store openings in those markets.
Constant dollar same store sales in established markets fell 0.8% in fiscal 2013 and fell 14.0% in new
markets. Established markets means countries in which the first Krispy Kreme store opened before fiscal 2007.
Sales at stores in established markets comprised approximately 49% of aggregate sales underlying the constant
dollar same store sales metric. While the Company considers countries in which Krispy Kreme first opened before
fiscal 2007 to be established markets, franchisees in those markets continue to develop their business. Of the 467
international shops currently in operation that opened since the beginning of fiscal 2007, 195 shops are in these
established markets.
48

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 49

OPERATOR PM10
International Franchise operating expenses include costs to recruit new international franchisees, to assist in
international store openings, and to monitor and aid in the performance of international franchise stores, as well
as allocated corporate costs. International Franchise operating expenses were flat at $6.3 million in fiscal 2013
compared to fiscal 2012. International Franchise operating expenses in fiscal 2013 reflect a decline in legal fees
associated with certain litigation as well as lower share-based compensation expense compared to fiscal 2012.
Share-based compensation expense was elevated in fiscal 2012 as a result of an executive officer in the segment
achieving retirement eligibility under the terms of the Companys stock compensation plan. Share-based payment
awards to retirement eligible persons are charged to expense at the grant date rather than being amortized over the
four-year vesting period of the awards. In addition, in fiscal 2012, the Company recorded a net credit of $380,000
to the bad debt provision principally related to the Mexican franchisee discussed above, while fiscal 2013 expenses
include a charge to bad debt expense of $180,000. Management expects International Franchise operating expenses
to rise in fiscal 2014 due to personnel additions to support international franchise growth, as well as anticipated
fiscal 2014 shop openings in new markets, which typically require a greater level of franchisor support than
openings in existing markets.
International franchisees opened 98 stores and closed 49 stores in fiscal 2013. As of February 3, 2013,
existing development and franchise agreements for territories outside the United States provide for the
development of 353 additional stores through fiscal 2019. Royalty revenues are directly related to sales by
franchise stores and, accordingly, the success of franchisees operations has a direct effect on the Companys
revenues, results of operations and cash flows.
KK Supply Chain
The components of KK Supply Chain revenues and expenses (expressed in dollars and as a percentage of
total revenues before intersegment sales elimination) are set forth in the table below (percentage amounts may not
add to totals due to rounding).
Year Ended
February 3, January 29,
2013
2012
(In thousands)
Percentage of Total
Revenues Before
Intersegment Sales
Elimination
Year Ended
February 3, January 29,
2013
2012
REVENUES:
Doughnut mixes
Other ingredients, packaging and supplies
Equipment
Fuel surcharge
Total revenues before intersegment sales elimination
$ 73,864
130,397
8,388
2,763
215,412
$ 69,147
126,528
8,333
2,445
206,453
34.3%
60.5
3.9
1.3
100.0
33.5%
61.3
4.0
1.2
100.0
OPERATING EXPENSES:
Cost of sales:
Cost of goods produced and purchased
(Gain) loss on agricultural derivatives
Inbound freight
Total cost of sales
Distribution costs
Other segment operating costs
Total operating costs
149,551
(837)
5,906
154,620
14,535
11,869
738
1,200
182,962
$ 32,450
141,810
451
4,651
146,912
14,955
12,596
730
1,100
176,293
$ 30,160
69.4
(0.4)
2.7
71.8
6.7
5.5
0.3
0.6
84.9
15.1%
68.7
0.2
2.3
71.2
7.2
6.1
0.4
0.5
85.4
14.6%
49

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 50

OPERATOR PM10
KK Supply Chain revenues before intersegment sales eliminations were $215.4 million in fiscal 2013
compared to $206.5 million in fiscal 2012. Excluding the 53rd week, KK Supply Chain revenues before
intersegment sales eliminations increased 2.2%.
Sales of doughnut mixes rose 4.6% on a 52-week basis in fiscal 2013, reflecting higher unit volumes partially
offset by lower selling prices resulting from a reduction in raw materials costs.
Sales of other ingredients, packaging and supplies, made principally to Company and Domestic Franchise
stores, rose 0.8% on a 52-week basis fiscal 2013 due to higher selling prices of sugar partially offset by lower unit
volumes in certain categories. While 52-week systemwide sales at Company and Domestic Franchise stores rose in
fiscal 2013 compared to fiscal 2012, a greater percentage of such systemwide sales was to on-premises customers
compared to wholesale customers in fiscal 2013. On-premises sales at Company and Domestic Franchise stores
generate proportionately lower KK Supply Chain sales than do sales to wholesale customers, because the average
customer unit selling price in the on-premises channel is generally higher than in the wholesale channel and
because the product returns associated with wholesale distribution generate significant waste. In addition, the
Company outsourced distribution to its International Franchise stores in fiscal 2012, which resulted in a reduction
in sales of non-mix products to those franchisees.
KK Supply Chain utilizes a fuel surcharge program to recoup additional freight costs resulting from
increases in fuel costs. Charges under the program are based upon the price of diesel fuel.
KK Supply Chain input costs increased to 69.4% of revenues in fiscal 2013 compared to 68.7% of revenues in
fiscal 2012, principally as a result of an approximate 10% increase in the cost of sugar. While the Company raised
selling prices to recover higher sugar costs, the Company did not mark up such higher costs, which resulted in an
increase in the overall cost of goods produced and purchased as a percentage of revenues.
Inbound freight as a percentage of revenues increased 0.4 percentage points in fiscal 2013 as a result of
outsourcing product distribution for stores east of the Mississippi to a third party provider beginning in fiscal
2012. These increased inbound freight costs were substantially offset by a reduction in distribution costs and
other segment operating costs, which include segment management, purchasing and customer service and support
expenses associated with the outsourcing of product distribution. Other segment operating expenses in fiscal 2012
also included a charge of approximately $330,000 for the settlement of certain sales tax litigation.
Franchisees opened 107 stores and closed 56 stores in fiscal 2013. A substantial portion of KK Supply
Chains revenues are directly related to sales by franchise stores and, accordingly, the success of franchisees
operations has a direct effect on the Companys revenues, results of operations and cash flows.
An increasing percentage of franchise store sales is attributable to sales by franchisees outside North
America. While the Company sells doughnut mixes and concentrates to its international franchisees, these
franchisees purchase substantially all other ingredients, packaging and supplies from local or regional vendors
approved by the Company. Accordingly, KK Supply Chain revenues are less correlated with sales by international
franchisees than with sales by domestic franchisees.
General and Administrative Expenses
General and administrative expenses were $25.1 million in fiscal 2013. Excluding the 53rd week, general and
administrative expenses were $24.8 million, or 5.8% of total revenues, in fiscal 2013 compared to $22.2 million, or
5.5% of total revenues, in fiscal 2012.
The increase in general and administrative expenses in fiscal 2013 reflects an increase in share-based
compensation of $317,000. Share-based compensation in fiscal 2012 included a charge of $332,000 to correct
prior years errors as described below. Exclusive of the effects of the error correction, share-based compensation
expense rose approximately $650,000 most of which was the result of an executive officer achieving retirement
eligibility under the terms of the Companys stock compensation plan in the first quarter of fiscal 2013. Sharebased payment awards to retirement eligible persons are charged to expense over the period from the grant date
50

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 51

OPERATOR PM10
to the date of retirement eligibility rather than being amortized over the four-year vesting period of the awards,
which has the effect of accelerating the recognition of the expense associated with awards to such persons as they
approach retirement eligibility.
General and administrative expenses in fiscal 2013 also reflect approximately $1.4 million of expenses
associated with the selection of a new enterprise resource planning system, professional fees associated
with the implementation of the tax asset protection plan, and a provision related to the settlement of certain
nuisancelitigation.
General and administrative expenses in the fourth quarter of fiscal 2012 reflect a reversal of approximately
$840,000 of remaining accruals for pledges to certain nonprofit organizations made in fiscal 2001 through 2004
which the Company determined for various reasons would not be honored. Such amount was largely offset by onetime costs associated with hiring a new executive officer, as well as by a charge of $474,000 to correct accounting
computational errors related to share-based compensation arising in prior periods (of which $142,000 arose in
earlier quarters of fiscal 2012 and the balance in fiscal 2007 through 2011). Except for the quantitative effect of
the correction of the errors on the fourth quarter of fiscal 2012, the share-based compensation errors were neither
quantitatively nor qualitatively material to the results of any period; accordingly, the errors were corrected in the
fourth quarter of fiscal 2012 and prior financial statements were not restated.
The Company is seeking to minimize general and administrative expenses in order to gain operating
leverage as its revenues rise.
Impairment Charges and Lease Termination Costs
Impairment charges and lease termination costs were $306,000 in fiscal 2013 compared to $793,000 in fiscal
2012. The components of these charges are set forth in the following table:
Year Ended
February 3,
January 29,
2013
2012
(In thousands)
Impairment of long-lived assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Lease termination costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
306
$306
$ 60
733
$793
Impairment charges relate to the Company Stores segment. The Company tests long-lived assets for
impairment when events or changes in circumstances indicate that their carrying value may not be recoverable.
These events and changes in circumstances include store closing and refranchising decisions, the effects of
changing costs on current results of operations, observed trends in operating results, and evidence of changed
circumstances observed as a part of periodic reforecasts of future operating results and as part of the Companys
annual budgeting process. Impairment charges generally relate to stores expected to be closed or refranchised,
as well as to stores management believes will not generate sufficient future cash flows to enable the Company
to recover the carrying value of the stores assets, but which management has not yet decided to close. When
the Company concludes that the carrying value of long-lived assets is not recoverable (based on future projected
undiscounted cash flows), the Company records impairment charges to reduce the carrying value of those assets
to their estimated fair values. The fair values of these assets are estimated based on the present value of estimated
future cash flows, on independent appraisals and, in the case of assets the Company is negotiating to sell, based on
the Companys negotiations with unrelated third-party buyers.
Lease termination costs represent the estimated fair value of liabilities related to unexpired leases, after
reduction by the amount of accrued rent expense, if any, related to the leases, and are recorded when the lease
contracts are terminated or, if earlier, the date on which the Company ceases use of the leased property. The fair value
of these liabilities were estimated as the excess, if any, of the contractual payments required under the unexpired
leases over the current market lease rates for the properties, discounted at a credit-adjusted risk-free rate over the
remaining term of the leases. The provision for lease termination costs also includes adjustments to liabilities
recorded in prior periods arising from changes in estimated sublease rentals and from settlements with landlords.
51

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 52

OPERATOR PM10
In fiscal 2013 and 2012, the Company recorded lease termination charges of $306,000 and $733,000,
respectively, principally reflecting a change in estimated sublease rentals and settlements with landlords on stores
previously closed.
The Company intends to refranchise certain geographic markets, expected to consist principally of, but
not necessarily limited to, markets outside the Companys traditional base in the southeastern United States.
combinations in prior years.
Since the beginning of fiscal 2009, the Company has refranchised a total of 11 stores and received
consideration totaling $2.5 million in connection with those transactions. During this period, the Company
recorded impairment charges totaling approximately $490,000 related to completed and anticipated refranchisings.
On February 22, 2013, the Company refranchised three stores in the Kansas/Missouri market; the Company
closed a fourth store in the market in January 2013 in anticipation of the transaction. The four stores had total sales
of approximately $9 million in fiscal 2013. The Company does not anticipate recording any significant gain or loss
on the refranchising transaction.
The Company cannot predict the likelihood of refranchising any additional stores or markets or the amount
of proceeds, if any, which might be received therefrom, including the amounts which might be realized from
the sale of store assets and the execution of any related franchise agreements. Refranchising could result in the
recognition of additional impairment losses on the related assets.
Interest Expense
The components of interest expense are as follows:
Year Ended
February 3,
January 29,
2013
2012
(In thousands)
Interest accruing on outstanding term loan indebtedness. . . . . . . . . . . . . . . . . . . . . . . . .

Letter of credit and unused revolver fees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Amortization of cost of interest rate derivative. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Amortization of deferred financing costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 708
303
34
398
199
$1,642
$ 803
355
422
86
$1,666
The decrease in interest accruing on outstanding indebtedness and in letter of credit and unused revolver fees
reflects the reduction in the principal outstanding under the Companys term loan and a reduction in the lenders
interest margin due to a decrease in the Companys leverage ratio.
Equity in Income (Losses) of Equity Method Franchisees
The Company recorded equity in the losses of equity method franchisees of $202,000 in fiscal 2013
compared to losses of $122,000 in fiscal 2012. This caption represents the Companys share of operating results of
equity method franchisees which develop and operate Krispy Kreme stores. On May 5, 2011, the Company sold
its 30% equity interest in KK Mexico, the Companys franchisee in Mexico, to KK Mexicos majority shareholder
as more fully described in Note 8 to the consolidated financial statements appearing elsewhere herein. The
Companys equity in earnings of KK Mexico was approximately $110,000 for the fiscal year ended 2012.
52
REVISION 4
JOB NUMBER 246088
TYPE Clean
SERIAL <12345678>
PAGE NO. 53

OPERATOR PM10
Gain on Sale of Interest in Equity Method Franchisee

In fiscal 2012, the Company realized a gain of approximately $6.2 million from the sale of the Companys
investment in KK Mexico, as more fully described in Note 8 to the consolidated financial statements appearing
elsewhere herein. The after-tax proceeds of the sale of approximately $6.2 million were used to prepay a portion of
the Companys 2011 Term Loan.
Other Non-Operating Income and Expense, Net
Other non-operating income and expense in fiscal 2013 and fiscal 2012 includes credits of $318,000 and
$215,000, respectively, representing reductions in recorded liabilities for franchisee guarantee obligations resulting
from decreases in the guaranteed amounts.
Provision for Income Taxes
The provision for income taxes was $15.5 million in fiscal 2013 and a credit of $135.9 million in fiscal 2012.
The fiscal 2012 amount includes a credit of $139.6 million ($1.95 per diluted share) from the reversal of a portion of
a valuation allowance on deferred income tax assets.
The Company establishes valuation allowances for deferred tax assets in accordance with GAAP, which
provides that such valuation allowances shall be established unless realization of the deferred tax assets is more
likely than not. From fiscal 2005 until the fourth quarter of fiscal 2012, the Company maintained a valuation
allowance on deferred tax assets equal to the entire excess of those assets over the Companys deferred tax
liabilities because of the uncertainty surrounding the realization of those assets. Such uncertainty arose principally
from the substantial losses incurred by the Company from fiscal 2005 though fiscal 2009.
Realization of net deferred tax assets generally is dependent on generation of taxable income in future
periods. The Company reported a pretax profit of $418,000 in fiscal 2010 and $8.9 million in fiscal 2011. In fiscal
2012, the Companys pretax profit increased to $30.4 million, inclusive of a $6.2 million non-recurring gain on the
Companys sale of its 30% equity interest in KK Mexico. After considering all relevant factors having an impact
on the likelihood of future realization of the Companys deferred tax assets, in the fourth quarter of fiscal 2012
management concluded that it was more likely than not that a substantial portion of the Companys deferred tax
assets would be realized in future years. Accordingly, in the fourth quarter of fiscal 2012, the Company reversed
$139.6 million of the valuation allowance on deferred tax assets, with an offsetting credit to the provision for
income taxes, representing the amount of deferred tax assets management believed was more likely than not to be
realized.
While the reversal of a portion of the valuation allowance increased the Companys earnings by
$139.6million in fiscal 2012, the reversal has the effect of reducing the Companys earnings beginning in fiscal
2013 as a result of an increase in the provision for income taxes. This negative effect on earnings occurs because
the reversal of the valuation allowance resulted in the recognition in fiscal 2012 of income tax benefits expected
to be realized in later years. Absent the reversal of the valuation allowance, any such tax benefits would have
been recognized when realized in future periods upon the generation of taxable income. Accordingly, beginning
in fiscal 2013, the Companys effective income tax rate, which in fiscal 2012 and earlier years bore little or no
relationship to pretax income, more closely reflects the blended federal and state income tax rates in jurisdictions
in which the Company operates.
Because of the increase in the Companys effective income tax rate as described above, the Companys
income tax expense in fiscal 2013 is not comparable to income tax expense in fiscal 2012. In addition, until such
time as the Companys net operating loss carryforwards are exhausted or expire, GAAP income tax expense is
expected to substantially exceed the amount of cash income taxes payable by the Company, which are expected to
remain insignificant.
53

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 54

OPERATOR PM10
In addition to adjustments to the valuation allowance on deferred tax assets, the provision for income
taxes includes amounts estimated to be payable or refundable currently. The portion of the income tax provision
representing taxes estimated to be payable currently was approximately $2.1 million and $3.5 million in fiscal
2013 and fiscal 2012, respectively, the majority of which represents foreign withholding taxes related to royalties
and franchise fees paid by international franchisees. In addition, the fiscal 2012 amount includes approximately
$1.5 million of foreign income taxes arising from the gain on the sale of the Companys interest in KK Mexico.
See Matters Affecting Comparability, above, for disclosures intended to compare the Companys results of
operations for fiscal 2013 and 2012 exclusive of the effects of the reversal of the valuation allowance on deferred
tax assets and the gain on the sale of the Companys interest in KK Mexico and related taxes thereon.
Net Income
The Company reported net income of $20.8 million for fiscal 2013 compared to $166.3 million for fiscal
2012. The fiscal 2012 net income includes a credit of $139.6 million from the reversal of a portion of a valuation
allowance on deferred income tax assets and an after-tax gain of $4.7 million on the Companys sale of its interest
in KK Mexico. See Matters Affecting Comparability above.
FISCAL 2012 COMPARED TO FISCAL 2011
The following discussion of the Companys results of operations should be read in conjunction with the
consolidated financial statements and notes thereto appearing elsewhere herein.
Matters Affecting Comparability
The Companys provision for income taxes, net income and earnings per share for fiscal 2012 are not
comparable to the corresponding amounts for fiscal 2011 as a result of the reversal of valuation allowances
on deferred tax assets in the fourth quarter of fiscal 2012. The Company has substantial net operating loss
carryforwards and, accordingly, the Companys cash payments for income taxes, which were not affected by the
reversal of the valuation allowance on deferred tax assets, are expected to remain insignificant for the foreseeable
future. See Results of Operations Fiscal 2012 Compared to Fiscal 2011 - Provision for Income Taxes below,
and Note 3 to the consolidated financial statements appearing elsewhere herein.
In addition, in the second quarter of fiscal 2012, the Company recognized a gain of approximately
$6.2million on the sale of its 30% equity interest in KK Mexico (approximately $4.7 million after deduction of
approximately $1.5 million of Mexican taxes payable on the transaction), as described in Note 8 to the consolidated
financial statements appearing elsewhere herein. Such gains should not be expected to occur regularly.
Management evaluates the Companys results of operations using, among other measures, adjusted net
income and adjusted earnings per share, which include the provision for income taxes only to the extent such taxes
are currently payable in cash. In addition, management excludes from adjusted net income charges and credits that
are unusual and infrequently occurring. Management believes adjusted net income and adjusted earnings per share
are useful performance measures because they more closely measure the cash flows generated by the Companys
operations and the trends in those cash flows than do GAAP net income and earnings per share, and because they
exclude the effects of transactions that are not indicative of the Companys ongoing results of operations.
Adjusted net income and adjusted earnings per share are non-GAAP measures.
The following presentation of adjusted net income, and the related reconciliation of adjusted net income
to GAAP net income and presentation of adjusted earnings per share, are intended to (1) assist the reader in
understanding the effects of the reversal of the valuation allowance and the non-recurring gain on the sale of the
interest in KK Mexico on the Companys results of operations for fiscal 2012; (2) facilitate comparisons of fiscal
2012 results with the Companys results for fiscal 2011; and (3) illustrate the material difference between the
54

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 55

OPERATOR PM10
Companys income tax expense and income taxes currently payable. These non-GAAP performance measures are
consistent with other measurements made by management in the operation of the business which do not consider
income taxes except to the extent to which those taxes currently are payable, for example, capital allocation
decisions and incentive compensation measurements that are made on a pretax basis.
Year Ended
January 29,
January 30,
2012
2011
(In thousands except per
share amounts)
Net income, as reported . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Provision for deferred income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Gain on sale of interest in KK Mexico (net of income taxes of $1,492) . . . . . . . . . . . . .
Adjusted net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 166,269
(139,403)
(4,706)
$ 22,160
$ 7,599
(95)
$ 7,504
Adjusted earnings per common share:

Basic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Diluted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
$
$
$
Weighted average shares outstanding:

Basic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Diluted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
0.32
0.31
69,145
71,497
0.11
0.11
68,337
69,922
Overview
Total revenues rose by 11.4% for the year ended January 29, 2012 compared to the year ended
January 30, 2011.
Consolidated operating income increased to $25.6 million from $15.2 million, and consolidated net income
was $166.3 million compared to $7.6 million. Consolidated net income for year ended January 29, 2012 includes
a non-recurring credit of $139.6 million from the reversal of valuation allowances on deferred tax assets and
a $4.7million after-tax gain on the sale of the Companys 30% equity interest in KK Mexico. See Matters
Affecting Comparability above.
55

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 56

OPERATOR PM10
Revenues by business segment (expressed in dollars and as a percentage of total revenues) and operating
income by business segment are set forth in the table below (percentage amounts may not add to totals due
to rounding).
Year Ended
January 29,
January 30,
2012
2011
(Dollars in thousands)
REVENUES BY BUSINESS SEGMENT:

Company Stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Domestic Franchise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
International Franchise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
KK Supply Chain:
Total revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less - intersegment sales elimination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
External KK Supply Chain revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 271,657
9,463
22,621
$245,841
8,527
18,282
206,453
(106,977)
99,476
$ 403,217
181,594
(92,289)
89,305
$361,955
Segment revenues as a percentage of total revenues:

Company Stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Domestic Franchise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
KK Supply Chain (external sales) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating income (loss):
Company Stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Domestic Franchise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
KK Supply Chain . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total segment operating income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Unallocated general and administrative expenses (including depreciation
and amortization expense) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Impairment charges and lease termination costs . . . . . . . . . . . . . . . . . . . . . . . . . . .
Consolidated operating income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
67.4%
2.3
5.6
24.7
100.0%
$
284
3,737
15,054
30,160
49,235
(22,875)
(793)
$ 25,567
67.9%
2.4
5.1
24.7
100.0%
$ (4,238)
3,498
12,331
30,213
41,804
(22,583)
(4,066)
$ 15,155
A discussion of the revenues and operating results of each of the Companys four business segments follows,
together with a discussion of income statement line items not associated with specific segments.
56

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 57

OPERATOR PM10
Company Stores
The components of Company Stores revenues and expenses (expressed in dollars and as a percentage of total
revenues) are set forth in the table below (percentage amounts may not add to totals due to rounding).
Year Ended
January 29,
January 30,
2012
2011
Percentage of Total
Revenues
Year Ended
January 29,
January 30,
2012
2011
(In thousands)
Revenues:
On-premises sales:
Retail sales . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Fundraising sales . . . . . . . . . . . . . . . . . . . . . . .
Total on-premises sales . . . . . . . . . . . . . . .
Wholesale sales:
Grocers/mass merchants . . . . . . . . . . . . . . . . .
Convenience stores . . . . . . . . . . . . . . . . . . . . .
Other wholesale . . . . . . . . . . . . . . . . . . . . . . . .
Total wholesale sales . . . . . . . . . . . . . . . . .
Total revenues . . . . . . . . . . . . . . . . . . .
Operating expenses:
Cost of sales:
Food, beverage and packaging . . . . . . . . . . . .
Shop labor . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Delivery labor . . . . . . . . . . . . . . . . . . . . . . . . .
Employee benefits . . . . . . . . . . . . . . . . . . . . . .
Total cost of sales . . . . . . . . . . . . . . . . . . . .
Vehicle costs (1) . . . . . . . . . . . . . . . . . . . . . . . . . .
Occupancy (2) . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Utilities expense . . . . . . . . . . . . . . . . . . . . . . . . . .
Depreciation expense . . . . . . . . . . . . . . . . . . . . . .
Other operating expenses . . . . . . . . . . . . . . . . . . .
Total store level costs . . . . . . . . . . . . . . . . . . .
Store operating income . . . . . . . . . . . . . . . . . . . . .
Other segment operating costs (3) . . . . . . . . . . . . .
Allocated corporate overhead . . . . . . . . . . . . . . . .
Segment operating income (loss). . . . . .
$ 111,701
14,302
126,003
$100,021
14,063
114,084
87,654
54,961
3,039
145,654
271,657
76,173
52,898
2,686
131,757
245,841
105,216
50,202
23,044
18,992
197,454
17,228
9,240
5,779
6,593
18,581
254,875
16,782
11,998
4,500
$
284
91,114
48,901
21,189
17,974
179,178
13,914
8,947
5,692
5,641
19,064
232,436
13,405
13,143
4,500
$ (4,238)
41.1%
5.3
46.4
32.3
20.2
1.1
53.6
100.0
38.7
18.5
8.5
7.0
72.7
6.3
3.4
2.1
2.4
6.8
93.8
6.2
4.4
1.7
0.1%
40.7%
5.7
46.4
31.0
21.5
1.1
53.6
100.0
37.1
19.9
8.6
7.3
72.9
5.7
3.6
2.3
2.3
7.8
94.5
5.5
5.3
1.8
(1.7)%
(1) Includes fuel, maintenance and repairs, rent, taxes and other costs of operating the delivery fleet, exclusive of
depreciation.
(2) Includes rent, property taxes, common area maintenance charges, insurance, building maintenance and other
occupancy costs, exclusive of utilities and depreciation.
(3) Includes marketing costs not charged to stores, segment management costs, wholesale selling expenses and
support functions.
57

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 58

OPERATOR PM10
A reconciliation of Company Stores segment sales from fiscal 2011 to fiscal 2012 follows:
Sales for the year ended January 30, 2011. . . . . . . . . . . . . . . . . . . . . . . . . .

Fiscal 2011 sales at closed stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Increase in sales at established stores (open stores only). . . . . . . . . . . . . . .
Increase in sales at stores opened in fiscal 2011 . . . . . . . . . . . . . . . . . . . . .
Sales at stores opened in fiscal 2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Sales for the year ended January 29, 2012. . . . . . . . . . . . . . . . . . . . . . . . . .
On-Premises
Wholesale
(In thousands)
Total
$ 114,084
(708)
6,066
2,004
4,557
$126,003
$131,757
13,897
$145,654
$245,841
(708)
19,963
2,004
4,557
$271,657
Sales at Company Stores increased 10.5% in fiscal 2012 from fiscal 2011 due to an increase in sales from
existing stores and stores opened in fiscal 2011 and fiscal 2012. Selling price increases in the on-premises and
wholesale distribution channels accounted for approximately 6.8 percentage points of the increase in sales,
exclusive of the effects of higher pricing on unit volumes; such effects are difficult to measure reliably. As with all
consumer products, however, higher prices may negatively affect sales. The Company believes this phenomenon
is more pronounced in the wholesale channel where competing products are merchandised alongside those of
theCompany.
Year Ended
January 29,
January 30,
2012
2011
ON-PREMISES:
Change in same store sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Change in same store customer count (retail sales only) . . . . . . . . . . . . . . . . . . . .
Average guest check (retail sales only) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
WHOLESALE:
Grocers/mass merchants:
Change in average weekly number of doors . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Change in average weekly sales per door . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Convenience stores:
Change in average weekly number of doors . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Change in average weekly sales per door . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5.2%
0.6%
$7.36
4.0%
1.8%
$7.06
2.6%
12.7%
0.5%
7.4%
(5.9)%
10.7%
(3.1)%
(1.0)%
On-premises sales
The components of the change in same store sales at Company stores are as follows:
Year Ended
January 29,
January 30,
2012
2011
CHANGE IN SAME STORE SALES ATTRIBUTABLE TO:

Retail pricing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Guest check average (exclusive of the effects of pricing) . . . . . . . . . . . . . . . . . . . . . . .
Customer count . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
7.4%
(2.9)
0.5
0.2
5.2%
2.8%
(1.2)
1.6
0.8
4.0%
On-premises sales
On-premises sales increased 10.4% to $126.0 million in fiscal 2012 from $114.1 million in fiscal 2011. On
March 7, 2011, the Company implemented price increases at substantially all its stores designed to help offset
the rising costs of doughnut mixes, other ingredients and fuel resulting from higher commodity prices. The price
increases, which affected approximately 60% of on-premises sales, averaged approximately 14%. These price
58

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 59

OPERATOR PM10
increases were not fully reflected in the same store sales metrics because they were in effect for only 47 of the
52 weeks in fiscal 2012. Additionally, during the third quarter of fiscal 2012, the Company raised its fundraising
prices approximately 8%.
Wholesale distribution
Sales to wholesale accounts increased 10.5% to $145.7 million in fiscal 2012 from $131.8 million in fiscal
2011. Approximately 6.0 percentage points of the sales increase reflects price increases, including not only
increases implemented in the first quarter of fiscal 2012 but also price increases implemented in fiscal 2011. The
Company believes the wholesale sales increase was greater than that of the doughnut industry as a whole. The
Company started implementing price increases for some products offered in the wholesale channel mid-April 2011,
and substantially completed implementing the increases during the second quarter. Those price increases affected
products comprising approximately 60% of wholesale sales, and the average price increase on those products was
approximately 11%.
Sales to grocers and mass merchants increased 15.1% to $87.7 million, with a 12.7% increase in average
weekly sales per door and a 2.6% increase in the average number of doors served. In addition to pricing, the
Company believes that average weekly sales per door in the grocer/mass merchant channel have grown as a result
of, among other things, improved customer service, introduction of additional price points, a redesign of product
packaging to improve its shelf appeal and the addition of new relatively higher volume doors.
Convenience store sales increased 3.9% to $55.0 million, reflecting a 10.7% increase in the average weekly
sales per door, partially offset by a 5.9% decline in the average number of doors served. The decline in the average
weekly number of doors in the convenience store channel in fiscal 2012 compared to fiscal 2011 was principally
the result of the Companys efforts to improve route management and route consolidation including the elimination
of and reduction in the number of stops at relatively low volume doors.
Costs and expenses
Total cost of sales as a percentage of revenues declined by 0.2 percentage points from 72.9% in fiscal 2011 to
72.7% of revenues in fiscal 2012.
As a result of rising costs of doughnut mixes and other ingredients resulting from higher commodity prices,
the Company implemented selling price increases designed to help offset the increased costs. Before considering
the potential loss of unit volume as a result of on-premises and wholesale selling price increases, those price
increases more than offset higher costs of food, beverages and packaging in fiscal 2012. The effects of price
increases on unit volumes are difficult to measure reliably. The combined effects of higher selling prices and
increased input costs accounted for substantially all of the increase in the cost of food, beverage and packaging as
a percentage of revenues for fiscal 2012 compared to last year. Exclusive of the effects of pricing and input costs,
food, beverage and packaging costs as a percentage of revenues were flat.
Shop labor as a percentage of revenues declined by 1.4 percentage points from fiscal 2011 to 18.5% of
revenues in fiscal 2012, principally due to higher sales resulting from price increases.
Vehicle costs as a percentage of revenues increased from 5.7% of revenues in fiscal 2011 to 6.3% of revenues
in fiscal 2012, principally as a result of higher fuel costs and higher expense of leased delivery trucks in fiscal
2012 compared to fiscal 2011. This increase was partially offset by a decrease in repairs and maintenance expense
in the fiscal 2012 as a result of the Company replacing a portion of its aging delivery fleet.
The Company is self-insured for workers compensation, automobile and general liability claims, but
maintains stop-loss coverage for individual claims exceeding certain amounts. The Company provides for
claims under these self-insured programs using actuarial methods as described in Note 1 to the consolidated
financial statements appearing elsewhere herein, and updates actuarial valuations of its self-insurance reserves
at least annually. Such periodic actuarial valuations result in changes over time in the estimated amounts which
ultimately will be paid for claims under these programs to reflect the Companys actual claims experience for
each policy year as well as trends in claims experience over multiple years. Such claims, particularly workers
59

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 60

OPERATOR PM10
compensation claims, often are paid over a number of years following the year in which the insured events occur,
and the estimated ultimate cost of each years claims accordingly is adjusted over time as additional information
becomes available. The Company recorded favorable adjustments to its self-insurance claims liabilities related to
prior years of approximately $1.3 million in fiscal 2012, of which $830,000 was recorded in the fourth quarter,
and $1.8 million in 2011, of which $1.2 million was recorded in the fourth quarter. Of the $1.3 million in favorable
adjustments recorded in fiscal 2012, $1.1 million relates to workers compensation liability claims and is included
in employee benefits in the table above, $40,000 relates to vehicle liability claims and is included in vehicle costs
in the table above and $180,000 relates to general liability claims and is included in other operating expenses
in the table above. Of the $1.8 million in favorable adjustments recorded in fiscal 2011, $1.4 million relates to
workers compensation liability claims, $300,000 relates to vehicle liability claims and $90,000 relates to general
liabilityclaims.
Other operating expenses as a percentage of revenues declined by 1.0 percentage point from fiscal 2011 to
6.8% of revenues in fiscal 2012 reflecting, among other things, lower store-level marketing expense.
Other segment operating costs as a percentage of revenues declined by 0.9 percentage points from the fiscal
2011 to 4.4% of revenues in fiscal 2012 reflecting, among other things, a decrease in spending on wholesale selling
and support expenses.
Domestic Franchise
Year Ended
January 29,
January 30,
2012
2011
(In thousands)
REVENUES:
Royalties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Development and franchise fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$8,675
355
433
9,463
$7,932
120
475
8,527
OPERATING EXPENSES:
Segment operating expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Depreciation expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Allocated corporate overhead . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total operating expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
SEGMENT OPERATING INCOME . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5,107
219
400
5,726
$3,737
4,409
220
400
5,029
$3,498
Domestic Franchise revenues increased 11.0% to $9.5 million in fiscal 2012 from $8.5 million in fiscal 2011.
The increase reflects higher domestic royalty revenues resulting from an increase in sales by domestic franchise
stores from approximately $239 million in fiscal 2011 to $262 million in fiscal 2012. Domestic Franchise same
store sales rose 6.6% fiscal 2012.
Domestic Franchise operating expenses include costs to recruit new domestic franchisees, to assist in
domestic store openings, and to monitor and aid in the performance of domestic franchise stores, as well as
allocated corporate costs. The increase in Domestic Franchise operating expenses in fiscal 2012 compared to
fiscal 2011 reflects a provision of $820,000 recorded in the second quarter of fiscal 2012 for payments under a
lease guarantee associated with a franchisee whose franchise agreements the Company terminated during the
second quarter, as well as an increase in franchisee support costs. The increase also reflects an increase in bad
debt expense as a result of a credit of $200,000 reflected in fiscal 2011, resulting principally from recoveries of
receivables previously written off. These increases were partially offset by the reversal of a previously recorded
accrual of $110,000 related to a franchisee lease guarantee as a result of the Company receiving a release from the
related guarantee during the third quarter of fiscal 2012. In addition, operating expenses reflected a decrease in
legal fees of $460,000 in fiscal 2012 compared to fiscal 2011. In fiscal 2011, the Company incurred unusually high
legal costs related to the Companys termination of the franchise agreements of one of its domestic franchisees.
60

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 61

OPERATOR PM10
Domestic franchisees opened 14 stores and closed 16 stores in fiscal 2012. Of the 16 closures, 10 were
operated by a franchisee whose franchise rights the Company terminated in the second quarter of fiscal 2012.
Royalty revenues are directly related to sales by franchise stores and, accordingly, the success of franchisees
operations has a direct effect on the Companys revenues, results of operations and cash flows.
Year Ended
January 29,
January 30,
2012
2011
(In thousands)
REVENUES:
Royalties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Development and franchise fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$21,308
1,313
22,621
$16,539
1,743
18,282
OPERATING EXPENSES:
Segment operating expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Depreciation expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Allocated corporate overhead . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total operating expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
SEGMENT OPERATING INCOME . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
6,261
6
1,300
7,567
$15,054
4,644
7
1,300
5,951
$12,331
International Franchise royalties increased 28.8%, driven by an increase in sales by international franchise
stores from $325 million in fiscal 2011 to $384 million in fiscal 2012. Changes in the rates of exchange between
the U.S. dollar and the foreign currencies in which the Companys international franchisees do business increased
sales by international franchisees measured in U.S. dollars by approximately $16.2 million in fiscal 2012 compared
to fiscal 2011, which positively affected international royalty revenues by approximately $970,000 in fiscal 2012.
In fiscal 2012, the Company recognized $280,000 of royalty revenue from the Companys Mexican franchisee
discussed in the second succeeding paragraph below. The Company did not recognize as revenue approximately
$1.6 million of uncollected royalties which accrued during fiscal 2011 because the Company did not believe
collection of these royalties was reasonably assured. Substantially all of the unrecognized royalties in fiscal 2011
related to the Companys Australian franchisee, which commenced a voluntary administration process (similar to a
bankruptcy filing in the U.S.) in October and November 2010. In connection with that process, in November 2010,
the franchisee closed 24 of the 53 shops the franchisee operated prior to the reorganization.
International development and franchise fees decreased $430,000 in fiscal 2012, primarily as a result of a
decline in the number of store openings from 95 in fiscal 2011 to 76 in fiscal 2012. This reduction in fees was
partially offset by the recognition of approximately $95,000 of franchise fees related to the Companys Mexican
franchisee described in the following paragraph.
Royalties and franchise fees in fiscal 2012 include approximately $280,000 and $95,000, respectively,
of amounts relating to the Companys franchisee in Mexico which accrued in prior periods but which had not
previously been reported as revenue because of uncertainty surrounding their collection. Such amounts were
reported as revenue in recognition of the payment of such amounts to the Company on May 5, 2011, in connection
with the Companys sale of its 30% equity interest in the franchisee, as more fully described in Note 8 to the
consolidated financial statements appearing elsewhere herein.
International Franchise same store sales, measured on a constant currency basis to remove the effects of
changing exchange rates between foreign currencies and the U.S. dollar (constant dollar same store sales), fell
10.8%. The decline in International Franchise same store sales reflects, among other things, waning honeymoon
effects from the large number of new stores opened internationally in recent years and the cannibalization effects
on initial stores in new markets of additional store openings in those markets. Honeymoon effect means the
common pattern for many start-up restaurants in which a flurry of activity due to start-up publicity and natural
61

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 62

OPERATOR PM10
curiosity is followed by a decline during which a steady repeat customer base develops. Cannibalization effect
means the tendency for new stores to become successful, in part or in whole, by shifting sales from existing stores
in the same market.
Constant dollar same store sales in established markets fell 1.9% in fiscal 2012 and fell 18.4% in new
markets. Established markets means countries in which the first Krispy Kreme store opened before fiscal 2007.
Sales at stores in established markets comprised approximately 51% of aggregate constant dollar same store sales.
International Franchise operating expenses include costs to recruit new international franchisees, to assist in
international store openings, and to monitor and aid in the performance of international franchise stores, as well as
allocated corporate costs. International Franchise operating expenses rose in fiscal 2012 compared to fiscal 2013
as a result of personnel additions, including benefits and travel costs, and other cost increases resulting from the
Companys decision to devote additional resources to the development and support of international franchisees.
These increases were partially offset by a decrease in bad debt expense to a net credit of $380,000 in fiscal 2012
compared to a net credit of $200,000 in fiscal 2011. The credit recorded to the bad debt provision in fiscal 2012
related principally to the Mexican franchisee discussed above. A net credit in bad debt expense should not be
expected to recur frequently.
International franchisees opened 76 stores and closed 33 stores in fiscal 2012. Royalty revenues are directly
related to sales by franchise stores and, accordingly, the success of franchisees operations has a direct effect on
the Companys revenues, results of operations and cash flows.
KK Supply Chain
The components of KK Supply Chain revenues and expenses (expressed in dollars and as a percentage of
total revenues before intersegment sales elimination) are set forth in the table below (percentage amounts may not
add to totals due to rounding).
Year Ended
January 29, January 30,
2012
2011
(In thousands)
Percentage of Total Revenues

Before Intersegment
Sales Elimination
Year Ended
January 29,
January 30,
2012
2011
REVENUES:
Doughnut mixes
Other ingredients, packaging and supplies
Equipment
Fuel surcharge
Total revenues before intersegment sales elimination
$ 69,147
126,528
8,333
2,445
206,453
$ 62,333
112,147
6,281
833
181,594
33.5%
61.3
4.0
1.2
100.0
34.3%
61.8
3.5
0.5
100.0
OPERATING EXPENSES:
Cost of sales:
Cost of goods produced and purchased
(Gain) loss on agricultural derivatives
Inbound freight
Total cost of sales
Distribution costs
Other segment operating costs
Total operating costs
141,810
451
4,651
146,912
14,955
12,596
730
1,100
176,293
$ 30,160
120,555
(544)
3,629
123,640
14,073
11,760
808
1,100
151,381
$ 30,213
68.7
0.2
2.3
71.2
7.2
6.1
0.4
0.5
85.4
14.6%
66.4
(0.3)
2.0
68.1
7.7
6.5
0.4
0.6
83.4
16.6%
62

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 63

OPERATOR PM10
KK Supply Chain revenues before intersegment sales eliminations increased $24.9 million, or 13.7%, in
fiscal 2012 compared to fiscal 2011. The increase reflects selling price increases for doughnut mixes, sugar,
shortening and certain other ingredients instituted by KK Supply Chain in order to pass along to Company and
franchise stores increases in KK Supply Chains cost of sugar, flour and shortening. The unit volumes in most
product categories were generally flat in fiscal 2012 compared to fiscal 2011.
The Company utilizes a fuel surcharge program to recoup additional freight costs resulting from increases
in fuel costs. Charges under the program are based upon the price of diesel fuel. The increase in fuel surcharges
compared to fiscal 2012 reflects the rising cost of diesel fuel, prices for which were higher relative to the surcharge
benchmark in fiscal 2012 than in fiscal 2011.
The increase in cost of goods produced and purchased as a percentage of sales in fiscal 2012 compared to
fiscal 2011 reflects, among other things, an increase in the cost of agricultural commodities used in the production
of doughnut mix and of other goods sold to Company and franchise stores. In particular, the prices of flour,
shortening and sugar and the products from which they are made were significantly higher in fiscal 2012 compared
fiscal 2011. KK Supply Chain increased the prices charged to Company and franchise stores for doughnut mixes,
shortening, sugar and other goods in order to mitigate increases in the cost of raw materials. However, KK Supply
Chain margins were adversely affected because, while the Company increased prices to cover higher costs, the
Company did not raise prices to earn a proportionate gross profit on all of its higher costs.
Distribution costs rose in fiscal 2012 compared to fiscal 2011 as a result of duplicate facility costs and other
conversion expenses associated with the transition of product distribution for stores east of the Mississippi to an
outsourced provider which began in June 2011; however, distribution costs as a percentage of total revenues fell in
fiscal 2012 compared to fiscal 2011 principally due to higher sales resulting from price increases.
Other segment operating costs include segment management, purchasing, customer service and support,
laboratory and quality control costs, and research and development expenses. These costs include a net credit
in bad debt expense of approximately $90,000 in fiscal 2012 compared to a charge of $270,000 in fiscal 2011.
The net credit in fiscal 2012 principally reflected sustained improved payment performance and reduced credit
exposure with respect to a small number of franchisees. A net credit in bad debt expense should not be expected to
recurfrequently.
Franchisees opened 90 stores and closed 49 stores in fiscal 2012. A substantial portion of KK Supply Chains
revenues are directly related to sales by franchise stores and, accordingly, the success of franchisees operations
has a direct effect on the Companys revenues, results of operations and cash flows.
An increasing percentage of franchise store sales is attributable to sales by franchisees outside North
America. While the Company sells doughnut mixes and concentrates to its international franchisees, these
franchisees purchase substantially all other ingredients, packaging and supplies from local or regional vendors
approved by the Company. Accordingly, KK Supply Chain revenues are less correlated with sales by international
franchisees than with sales by domestic franchisees.
General and Administrative Expenses
General and administrative expenses were $22.2 million, or 5.5% of total revenues, in fiscal 2012 compared
to $21.9 million, or 6.0% of total revenues, in fiscal 2011. General and administrative expenses in the fourth
quarter of fiscal 2012 reflect a reversal of approximately $840,000 of remaining accruals for pledges to certain
nonprofit organizations made in fiscal 2001 through 2004 which the Company determined for various reasons
would not be honored. Such amount was largely offset by one-time costs associated with hiring a new executive
officer, as well as by a charge of $474,000 to correct accounting computational errors related to share-based
compensation arising in prior periods (of which $142,000 arose in earlier quarters of fiscal 2012 and the balance
in fiscal 2007 through 2011). Except for the quantitative effect of the correction of the errors on the fourth quarter
of fiscal 2012, the share-based compensation errors were neither quantitatively nor qualitatively material to the
results of any period; accordingly, the errors were corrected in the fourth quarter of fiscal 2012 and prior financial
statements were not restated.
63

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 64

OPERATOR PM10
Impairment Charges and Lease Termination Costs

Impairment charges and lease termination costs were $793,000 in fiscal 2012 compared to $4.1 million in
fiscal 2011. The components of these charges are set forth in the following table:
Year Ended
January 29,
January 30,
2012
2011
(In thousands)
Impairment charges:
Impairment of long-lived assets - current period charges . . . . . . . . . . . . . . . . . . . . . . .
Impairment of long-lived assets - adjustments to previously recorded estimates . . . . .
Impairment of reacquired franchise rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total impairment charges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Lease termination costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 60
60
733
$793
$3,437
(173)
40
3,304
762
$4,066
Impairment charges relate to the Company Stores segment. The Company tests long-lived assets for
impairment when events or changes in circumstances indicate that their carrying value may not be recoverable.
These events and changes in circumstances include store closing and refranchising decisions, the effects of
changing costs on current results of operations, observed trends in operating results, and evidence of changed
circumstances observed as a part of periodic reforecasts of future operating results and as part of the Companys
annual budgeting process. Impairment charges generally relate to stores expected to be closed or refranchised,
as well as to stores management believes will not generate sufficient future cash flows to enable the Company
to recover the carrying value of the stores assets, but which management has not yet decided to close. When
the Company concludes that the carrying value of long-lived assets is not recoverable (based on future projected
undiscounted cash flows), the Company records impairment charges to reduce the carrying value of those assets
to their estimated fair values. The fair values of these assets are estimated based on the present value of estimated
future cash flows, on independent appraisals and, in the case of assets the Company is negotiating to sell, based on
the Companys negotiations with unrelated third-party buyers.
contracts are terminated or, if earlier, the date on which the Company ceases use of the leased property. The
fair value of these liabilities were estimated as the excess, if any, of the contractual payments required under the
unexpired leases over the current market lease rates for the properties, discounted at a credit-adjusted risk-free
rate over the remaining term of the leases. In fiscal 2012, the Company recorded lease termination charges of
$733,000, principally reflecting a change in estimated sublease rentals and settlements with landlords on stores
previously closed. In fiscal 2011, the Company recorded lease termination charges of $762,000, representing a
change in estimated sublease rentals on stores previously closed and charges related to two store closures and a
store relocation, partially offset by the reversal of previously recorded accrued rent related to those stores.
The Company intends to refranchise certain geographic markets, expected to consist principally of, but
not necessarily limited to, markets outside the Companys traditional base in the southeastern United States.
combinations in prior years.
Since the beginning of fiscal 2009, the Company has refranchised a total of 11 stores and received
consideration totaling $2.5 million in connection with those transactions. During this period, the Company
recorded impairment charges totaling approximately $490,000 related to completed and anticipated refranchisings.
64
REVISION 4
JOB NUMBER 246088
TYPE Clean
SERIAL <12345678>
PAGE NO. 65

OPERATOR PM10
Interest Expense
The components of interest expense are as follows:
Year Ended
January 29,
January 30,
2012
2011
(In thousands)
Interest accruing on outstanding indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Letter of credit and unused revolver fees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Amortization of deferred financing costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Amortization of unrealized losses on interest rate derivatives. . . . . . . . . . . . . . . . . . . . .
Other. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 803
355
422
86
$1,666
$4,312
1,136
696
152
63
$6,359
The decrease in interest accruing on outstanding term loan indebtedness and in letter of credit and unused
revolver fees reflects the substantial reduction in lender margin on the Companys credit facilities resulting from
the refinancing of those facilities in January 2011, as more fully described in Note 12 to the consolidated financial
statements appearing elsewhere herein, as well as the reduction in the principal outstanding under the Companys
term loan. The interest rate derivative contracts which gave rise to the amortization of unrealized losses on interest
rate derivatives in fiscal 2011 expired in April 2010.
Loss on Refinancing of Debt
During the fourth quarter of fiscal 2011, the Company closed the 2011 Secured Credit Facilities described
below under Liquidity and Capital Resources Cash Flows From Financing Activities and used the proceeds
to retire other indebtedness, as more fully described in Note 12 to the consolidated financial statements appearing
elsewhere herein. The Company recorded a loss on the refinancing of approximately $1.0 million, consisting of an
$865,000 write-off of unamortized deferred financing costs related to the retired debt and $160,000 related to other
expenses.
Equity in Income (Losses) of Equity Method Franchisees
The Company recorded equity in the losses of equity method franchisees of $122,000 in fiscal 2012
compared to earnings of $547,000 in fiscal 2011. This caption represents the Companys share of operating results
of equity method franchisees which develop and operate Krispy Kreme stores. On May 5, 2011, the Company sold
its 30% equity interest in KK Mexico, the Companys franchisee in Mexico, to KK Mexicos majority shareholder
as more fully described in Note 8 to the consolidated financial statements appearing elsewhere herein. The
Companys equity in earnings of KK Mexico was approximately $110,000 and $790,000 for the fiscal year ended
2012 and 2011, respectively.
Gain on Sale of Interest in Equity Method Franchisee
In fiscal 2012, the Company realized a gain of approximately $6.2 million from the sale of the Companys
investment in KK Mexico, as more fully described in Note 8 to the consolidated financial statements appearing
elsewhere herein. The after-tax proceeds of the sale of approximately $6.2 million were used to prepay a portion of
the Companys 2011 Term Loan.
Other Non-Operating Income and Expense, Net
Other non-operating income and expense in fiscal 2012 and fiscal 2011 includes credits of $215,000 and
$329,000, respectively, representing reductions in recorded liabilities for franchisee guarantee obligations resulting
from decreases in the guaranteed amounts.
65
REVISION 4
JOB NUMBER 246088
TYPE Clean
SERIAL <12345678>
PAGE NO. 66

OPERATOR PM10
Provision for Income Taxes

The provision for income taxes was a credit of $135.9 million in fiscal 2012 and a charge of $1.3 million in
fiscal 2011. The fiscal 2012 amount includes a credit of $139.6 million ($1.95 per diluted share) from the reversal of
a portion of a valuation allowance on deferred income tax assets.
The Company establishes valuation allowances for deferred tax assets in accordance with GAAP, which
provides that such valuation allowances shall be established unless realization of the deferred tax assets is more
likely than not. From fiscal 2005 until the fourth quarter of fiscal 2012, the Company maintained a valuation
allowance on deferred tax assets equal to the entire excess of those assets over the Companys deferred tax
liabilities because of the uncertainty surrounding the realization of those assets. Such uncertainty arose principally
from the substantial losses incurred by the Company from fiscal 2005 though fiscal 2009.
Realization of net deferred tax assets generally is dependent on generation of taxable income in future
periods. The Company reported a pretax profit of $418,000 in fiscal 2010 and $8.9 million in fiscal 2011. In fiscal
2012, the Companys pretax profit increased to $30.4 million, inclusive of a $6.2 million non-recurring gain on the
Companys sale of its 30% equity interest in KK Mexico. After considering all relevant factors having an impact
assets would be realized in future years. Accordingly, in the fourth quarter of fiscal 2012, the Company reversed
$139.6 million of the valuation allowance on deferred tax assets, with an offsetting credit to the provision for
income taxes, representing the amount of deferred tax assets management believed was more likely than not to
berealized.
While the reversal of a portion of the valuation allowance increased the Companys earnings by
$139.6million in fiscal 2012, the reversal has the effect of reducing the Companys earnings beginning in fiscal
2013 as a result of an increase in the provision for income taxes in such years. This negative effect on earnings
occurs because the reversal of the valuation allowance resulted in the recognition in fiscal 2012 of income tax
benefits expected to be realized in later years. Absent the reversal of the valuation allowance, any such tax benefits
would have been recognized when realized in future periods upon the generation of taxable income. Accordingly,
beginning in fiscal 2013, the Companys effective income tax rate, which in fiscal 2012 and earlier years bore
little or no relationship to pretax income, more closely reflects the blended federal and state income tax rates in
jurisdictions in which the Company operates.
income tax expense in fiscal 2013 is not comparable to income tax expense in fiscal 2012 and earlier years. In
addition, until such time as the Companys net operating loss carryforwards are exhausted or expire, GAAP
income tax expense is expected to substantially exceed the amount of cash income taxes payable by the Company,
which are expected to remain insignificant.
In addition to adjustments to the valuation allowance on deferred tax assets, the provision for income
taxes includes amounts estimated to be payable or refundable currently. The portion of the income tax provision
representing taxes estimated to be payable currently was approximately $3.5 million and $1.4 million in fiscal
2012 and fiscal 2011, respectively, the majority of which represents foreign withholding taxes related to royalties
and franchise fees paid by international franchisees. In addition, the fiscal 2012 amount includes approximately
$1.5million of foreign income taxes arising from the gain on the sale of the Companys interest in KK Mexico.
See Matters Affecting Comparability, above, for disclosures intended to compare the Companys results of
operations for fiscal 2012 and 2011 exclusive of the effects of the reversal of the valuation allowance on deferred
tax assets and the gain on the sale of the Companys interest in KK Mexico and related taxes thereon.
Net Income
The Company reported net income of $166.3 million for fiscal 2012 compared to $7.6 million for fiscal 2011.
Fiscal 2012 net income includes a credit of $139.6 million from the reversal of a portion of a valuation allowance
on deferred income tax assets and an after-tax gain of $4.7 million on the Companys sales of its interest in KK
Mexico. See Matters Affecting Comparability above.
66

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 67

OPERATOR PM10
LIQUIDITY AND CAPITAL RESOURCES

The following table presents a summary of the Companys cash flows from operating, investing and
financing activities for fiscal 2013, fiscal 2012 and fiscal2011:
February 3,
2013
Year Ended
January 29,
2012
January 30,
2011
(Inthousands)
Net cash provided by operating activities . . . . . . . . . . . . . . . . . . . . . . .

Net cash used for investing activities . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net cash used for financing activities . . . . . . . . . . . . . . . . . . . . . . . . . .
Net increase in cash and cash equivalents . . . . . . . . . . . . . . . . . . . . .
$ 59,310
(14,438)
(22,859)
$ 22,013
$33,861
(2,524)
(8,988)
$22,349
$ 20,508
(8,572)
(10,181)
$ 1,755
Cash Flows from Operating Activities

Cash provided by operating activities in fiscal 2013 increased $25.4million to $59.3million from
$33.9million in fiscal 2012. Approximately $15.2million of the improvement reflects the increase in operating
cash flow from $37.4million in fiscal 2012 to $52.6million in fiscal 2013. The improvement also reflects a net
increase in customer deposits of $1.0million in fiscal 2013 compared to a net decrease of $310,000 in fiscal
2012. The increase reflects deposits related to equipment sales to international franchisees for new stores being
developed that are expected to open in fiscal 2014. The improvement also reflects a net increase in deferred
franchise fee revenue of $1.2million in fiscal 2013 compared to a net decrease of $380,000 in fiscal 2012. The
increase reflects the execution of four new international franchise development agreements in fiscal 2013. Cash
provided by operating activities in fiscal 2013 also reflects the receipt of $2.0million of landlord contributions to
building renovation costs related to the Companys headquarters building and to new stores. Finally, payments on
leases related to closed stores were approximately $1.7million higher in fiscal 2012 than in fiscal 2013, principally
due to settlements with landlords in fiscal 2012 on terminated leases. The remainder of the change in cash flows
from operating activities principally reflects normal fluctuations in workingcapital.
Cash provided by operating activities in fiscal 2012 increased $13.4million to $33.9million from
$20.5million in fiscal 2011. Approximately $13.0million of the improvement reflects the increase in operating
cash flow from $24.4million in fiscal 2011 to $37.4million in fiscal 2012. Also, cash provided by operating
activities in fiscal 2011 reflected the payment of approximately $2.0million to a landlord in connection with the
renegotiation and renewal of the lease for the Companys headquarters. The balance of the change in cash flows
from operating activities principally reflects normal fluctuations in workingcapital.
Cash Flows from Investing Activities
The components of capital expenditures in each of the last three fiscal years were approximately asfollows:
New store construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Store remodels and betterments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other store equipment, including vehicles and point-of-sale
and handheld equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Corporate office remodel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Corporate information technology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
67
February 3,
2013
Year Ended
January 29,
2012
(Inthousands)
January 30,
2011
$ 3,533
3,933
$ 3,682
4,236
$1,831
4,868
2,413
3,507
303
529
$14,218
3,292
140
534
$11,884
2,000
429
566
$9,694

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 68

OPERATOR PM10
In addition, the Company acquired two stores from a franchisee for $915,000 during fiscal2013.
In fiscal 2012, the Company received proceeds of $7.7million from the sale of the Companys 30% equity
interest in KK Mexico as more fully described in Note 8 to the consolidated financial statements appearing
elsewhereherein.
In fiscal 2011, the Company realized proceeds from the sale of property and equipment of $2.9million from
the sale of closed stores or refranchisedstores.
In connection with the refinancing of the Companys Secured Credit Facilities in January 2011, as more
fully described in Note 12 to the consolidated financial statements appearing elsewhere herein, the Company
deposited into escrow $1.8million related to properties with respect to which the Company agreed to furnish to the
lenders certain documentation on or before January 31, 2012, with amounts to be released from escrow upon the
Companys furnishing such documentation. In fiscal 2012, the entire $1.8million was released fromescrow.
Cash Flows from Financing Activities
During fiscal 2013, the Company repaid approximately $2.3million of outstanding term loan and capitalized
lease indebtedness, consisting of approximately $2.2million of scheduled principal amortization and $120,000 of
prepayments from the proceeds of the exercise of stockoptions.
During fiscal 2012, the Company repaid approximately $9.0million of outstanding term loan and capitalized
lease indebtedness, consisting of approximately $2.3million of scheduled principal amortization, $6.2million
of prepayments from the sale of the Companys interest in KK Mexico as more fully described in Note 8 to the
consolidated financial statements appearing elsewhere herein, and $520,000 of prepayments from the proceeds of
the exercise of stockoptions.
In January 2011, the Company entered into the 2011 Secured Credit Facilities as more fully described
in Note12 to the consolidated financial statements appearing elsewhere herein. Those facilities consist of the
$35million 2011 Term Loan and the $25million 2011 Revolver. The proceeds of the 2011 Term Loan were
used to retire the approximately $35million outstanding term loan balance under the Companys prior secured
credit facilities, which were terminated. The Company paid approximately $1.5million in fees and expenses
in connection with the 2011 Secured Credit Facilities, of which approximately $1.3million was capitalized as
deferred financing costs and the balance of approximately $160,000 was charged to expense and is included in
Loss on refinancing of debt in the accompanying consolidated statement of operations. During fiscal 2011, the
Company repaid $8.3million of outstanding term loan and capitalized lease indebtedness prior to the refinancing,
consisting of approximately $700,000 of scheduled principal amortization, $2.6million of prepayments from the
sale of a closed store, and a discretionary prepayment of $5million.
During fiscal 2013, pursuant to an authorization of the Companys Board of Directors, and with the
approval of its lenders, the Company repurchased in open market transactions approximately 3,113,000 shares of
its common stock for $20million, an average price of $6.42 per share. The Companys Board of Directors may
authorize additional share repurchases or other transactions involving the direct or indirect distribution of cash to
the Companys shareholders, but the Company currently does not contemplate instituting a regular cash dividend.
The Companys secured credit facilities impose significant limitations on redemptions of the Companys shares
and cash distributions to shareholders and, accordingly, approval of the Companys lenders would be required prior
to implementing any suchtransaction.
68

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 69

OPERATOR PM10
Capital Resources, Contractual Obligations and Off-Balance Sheet Arrangements

In addition to cash generated from operations, the Company utilizes other capital resources and financing
arrangements to fund its business. A discussion of these capital resources and financing techniques is
includedbelow.
Debt
The Company continuously monitors its funding requirements for general working capital purposes and
other financing and investing activities. In the last three fiscal years, management focused on reducing or
eliminating the Companys investments in franchisees and the related guarantees of franchisees obligations,
reducing outstanding debt, and on restructuring the Companys borrowing arrangements to maintain credit
availability and lower financing costs to facilitate accomplishing the Companys business restructuring and
expansioninitiatives.
The 2011 Secured Credit Facilities described in Note 12 to the consolidated financial statements appearing
elsewhere herein are the Companys principal source of external financing. The 2011 Secured Credit Facilities
contain significant financial covenants. Based on the Companys current working capital and the fiscal 2014
operating plan, management believes the Company can comply with the financial covenants and that the Company
can meet its projected operating, investing and financing cashrequirements.
The operation of the financial covenants described above could limit the amount the Company may borrow
under the 2011 Revolver. In addition, the maximum amount which may be borrowed under the 2011 Revolver
is reduced by the amount of outstanding letters of credit, which totaled approximately $10.2million as of
February 3, 2013, all of which secure the Companys reimbursement obligations to insurers under the Companys
self-insurance arrangements. The unused borrowing capacity available to the Company as of February 3, 2013
was approximately $14.8million. The restrictive covenants did not limit the Companys ability to borrow the full
$14.8million of unused credit under the 2011 Revolver at thatdate.
The 2011 Secured Credit Facilities also contain customary events of default including, without limitation,
payment defaults, breaches of representations and warranties, covenant defaults, cross-defaults to other
indebtedness in excess of $2.5million, certain events of bankruptcy and insolvency, judgment defaults in excess of
$2.5million and the occurrence of a change ofcontrol.
Leases
The Company conducts some of its operations from leased facilities and leases certain equipment. Generally,
these leases have initial terms of two to 20 years and contain provisions for renewal options of five to 15 years.
In determining whether to enter into a lease for an asset, the Company evaluates the nature of the asset and the
associated lease terms to determine if leasing is an effective financingtool.
Off-Balance Sheet Arrangements
The Companys only off-balance sheet arrangements, as defined by Item 303(a)(4) of SEC Regulation S-K,
consist principally of the Companys guarantees of indebtedness of certain franchisees, as discussed in Notes 8
and 14 to the consolidated financial statements appearing elsewhereherein.
69

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 70

OPERATOR PM10
Contractual Cash Obligations at February 3, 2013

The Companys contractual cash obligations as of February 3, 2013 are asfollows:
Payments Due In
Long-term debt (excluding capital lease obligations),

including current maturities . . . . . . . . . . . . . . . . . . . . . .
Interest payment obligations (1) . . . . . . . . . . . . . . . . . . . . . .
Capital lease obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Capital lease interest obligations . . . . . . . . . . . . . . . . . . . . .
Operating lease obligations . . . . . . . . . . . . . . . . . . . . . . . . .
Purchase obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Contingent guarantee obligations (2) . . . . . . . . . . . . . . . . . .
Other long-term obligations, including current portion,
reflected on the Companys balancesheet:
Self-insurance claims, principally workers
compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
401(k) mirror plan liability . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total
Amount
Less
than
1
Year
$ 24,303
2,535
1,440
3,836
119,027
81,353
2,065
$ 1,869
893
279
219
11,267
52,737
2,065
$22,434
1,642
110
417
19,654
27,615
14,135
1,816
$250,510
4,156
$73,485
4,249
$76,121
1,999
$16,755
1-3
Years
(Inthousands)
More
Than
5
Years
3-5
Years
431
13,324
1,001
1,051
2,769
74,782
3,731
1,816
$84,149
(1) Estimated interest payments for variable rate debt are based upon the LIBOR interest rate as of
February3,2013.
(2) Amounts represent 100% of the Companys aggregate exposure at February 3, 2013 under loan guarantees
related to franchisees in which the Company has an ownership interest. The timing of the potential payment
is based upon the maturity of the guaranteed indebtedness. No demand has been made on the Company to
perform under any of theguarantees.
The preceding table of contractual cash obligations excludes income tax liabilities of approximately
$1.2million as of February 3, 2013 for uncertain tax positions due to uncertainty in predicting the timing of any
such relatedpayments.
Capital and Liquidity Requirements
In the next five years, the Company plans to use cash primarily for the followingactivities:

Working capital and other general corporatepurposes;

Opening new Company stores, principally small retail shops, in selectedmarkets;

Remodeling, replacement and relocation of selected older Companyshops;

Routine capital expenditures to maintain the appearance and functionality of the Companys facilities and
equipment, including its wholesale commissaries and retail Krispy Kremeshops;

Maintaining and enhancing the KK Supply Chain manufacturing and distribution capabilities; and

Investing in informationtechnology.
70

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 71

OPERATOR PM10
The Companys capital requirements for these activities may be significant. The amount of these capital
requirements will depend on many factors, including the Companys overall performance, the pace of store
expansion, securing desirable real estate for new stores, the number of store remodels, and other infrastructure
needs. The Company currently estimates that its capital expenditures for fiscal 2014 will be in the range of
$23million to $35million. The most significant capital expenditures currently planned for fiscal 2014 are from
seven to ten new stores, refurbishments and replacement of existing stores, new point-of-sale software to replace
existing software that is approaching the end of its useful life, initial investment in a new enterprise resource
planning system and enhancements to and replacements of existing information technology systems, and ongoing
smaller, routine capital expenditures. The Company plans to fund these expenditures principally using cash
provided by operations and current cash resources, although the Company may choose to lease certain anticipated
assetacquisitions.
The Company believes that its current cash balances, cash expected to be generated from operations and
the liquidity afforded by the 2011 Revolver are sufficient to meet the Companys liquidity requirements for the
foreseeablefuture.
Inflation
The Company does not believe that general price inflation has had a material effect on its results of
operations in recent years. However, prices of agricultural commodities and fuel have been volatile in recent years.
Those price changes, which have generally trended upward, have had a significant effect on the cost of flour,
shortening and sugar, the three most significant ingredients used in the production of the Companys products, as
well as on the cost of gasoline consumed by the Companys wholesale deliveryfleet.
Critical Accounting Policies
The Companys discussion and analysis of its financial condition and results of operations is based upon its
financial statements that have been prepared in accordance with GAAP. The preparation of financial statements in
accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts
of assets, liabilities, revenues and expenses and related disclosures, including disclosures of contingencies and
uncertainties. GAAP provides the framework from which to make these estimates, assumptions and disclosures.
The Company chooses accounting policies within GAAP that management believes are appropriate to accurately
and fairly report the Companys operating results and financial position in a consistent manner. Management
regularly assesses these policies in light of changes in facts and circumstances and discusses the selection of
accounting policies and significant accounting judgments with the Audit Committee of the Board of Directors.
The Company believes that application of the following accounting policies involves judgments and estimates that
are among the more significant used in the preparation of the financial statements, and that an understanding of
these policies is important to understanding the Companys financial condition and results ofoperations.
Allowance for Doubtful Accounts
Accounts receivable arise primarily from royalties earned on sales by the Companys franchisees, sales by
KK Supply Chain to our franchisees of equipment, mix and other supplies necessary to operate a Krispy Kreme
store, as well as from wholesale sales by company stores to convenience and grocery stores and other customers.
The Company has recorded provisions for doubtful accounts related to its accounts receivable, including
receivables from franchisees, in amounts which management believes are sufficient to provide for losses estimated
to be sustained on realization of these receivables. Such estimates inherently involve uncertainties and assessments
of the outcome of future events, and changes in facts and circumstances may result in adjustments to the provision
for doubtfulaccounts.
71

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 72

OPERATOR PM10
Goodwill
The Financial Accounting Standards Board (FASB) guidance related to goodwill addresses the accounting
and reporting of goodwill subsequent to its acquisition. This guidance provides that goodwill is not subject to
amortization but must be tested annually for impairment, or more frequently if events and circumstances indicate
potentialimpairment.
The Company performs the annual test for goodwill impairment as of December 31. The impairment test
for indefinite-lived intangible assets like goodwill involves comparing the fair value of such assets with their
carrying value, with any excess of carrying value over fair value recorded as an impairment charge. The goodwill
impairment test involves determining the fair values of the reporting units to which goodwill is assigned and
comparing those fair values to the reporting units carrying values, including goodwill. The Company estimates
the fair value of its reporting units forecasting future revenues, expenses and any capital spending to derive future
reporting unit cash flows, then discounts those cash flows to present value. The Company also considers the
estimated fair values of its reporting units relative to the Companys overall market capitalization in connection
with its goodwill impairment assessment. Changes in projections or estimates could significantly change the
estimated fair values of reporting units. In addition, if management uses different assumptions or estimates in the
future or if conditions exist in future periods that are different than those anticipated, operating results and the
balances of goodwill could be affected by impairment charges. There were no goodwill impairment charges in
fiscal 2013, 2012 or 2011. As of February 3, 2013, the remaining goodwill had a carrying value of $23.5million,
of which $7.8million and $15.7million was associated with the Domestic and International Franchise segments,
respectively, each of which consists of a single reporting unit. The risk of goodwill impairment would increase
in the event that the franchise segments operating results were to significantly deteriorate or the overall market
capitalization of the Company were to decline below the book value of the Companys shareholdersequity.
In September 2011, the FASB amended the guidance on the annual testing of goodwill for impairment. The
amended guidance will permit, but does not require, companies to assess qualitative factors to determine if it is
more likely than not that goodwill might be impaired and whether it is necessary to perform the two-step goodwill
impairment test required under current accounting standards. Companies may elect to apply the new guidance
in some periods and not in others, and to some reporting units and not to others. The Company adopted the
amended guidance in the fourth quarter of fiscal 2012. Such adoption had no effect on the Companys consolidated
financialstatements.
Asset Impairment
When an asset group (typically a store) is identified as underperforming or when a decision is made to
abandon an asset group or to close a store, the Company makes an assessment of the potential impairment of the
related assets. The assessment is based upon a comparison of the carrying amount of the assets, primarily property
and equipment, to the estimated undiscounted cash flows expected to be generated from those assets. To estimate
cash flows, management projects the net cash flows anticipated from continuing operation of the asset group
or store until its closing or abandonment, as well as cash flows, if any, anticipated from disposal of the related
assets. If the carrying amount of the assets exceeds the sum of the undiscounted cash flows, the Company records
an impairment charge in an amount equal to the excess of the carrying value of the assets over their estimated
fairvalue.
Determining undiscounted cash flows and the fair value of an asset group involves estimating future cash
flows, revenues, operating expenses and disposal values. The projections of these amounts represent managements
best estimates at the time of the review. If different cash flows had been estimated, property and equipment balances
and related impairment charges could have been affected. Further, if management uses different assumptions
or estimates in the future or if conditions exist in future periods that are different than those anticipated, future
operating results could be affected. In addition, the sale of assets whose carrying value has been reduced by
impairment charges could result in the recognition of gains or losses to the extent the sales proceeds realized differ
from the reduced carrying amount of the assets. The Company recorded no impairment charges in fiscal 2013. In
fiscal 2012 and 2011, the Company recorded impairment charges related to long-lived assets totaling approximately
$60,000 and $3.3million, respectively. Additional impairment charges may be necessary in futureyears.
72

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 73

OPERATOR PM10
Insurance
The Company is subject to workers compensation, vehicle and general liability claims. The Company is
self-insured for the cost of all workers compensation, vehicle and general liability claims up to the amount of stoploss insurance coverage purchased by the Company from commercial insurance carriers. The Company maintains
accruals for the estimated cost of claims on an undiscounted basis, without regard to the effects of stop-loss
coverage, using actuarial methods which evaluate known open and incurred but not reported claims and consider
historical loss development experience. In addition, the Company records receivables from the insurance carriers
for claims amounts estimated to be recovered under the stop-loss insurance policies when these amounts are
estimable and probable of collection. The Company estimates such stop-loss receivables using the same actuarial
methods used to establish the related claims accruals, and taking into account the amount of risk transferred to the
carriers under the stop-loss policies. Many estimates and assumptions are involved in estimating future claims,
and differences between future events and prior estimates and assumptions could affect future operating results
and result in adjustments to these loss accruals and related insurancereceivables.
Income Taxes
The Company recognizes deferred income tax assets and liabilities based upon managements expectation
of the future tax consequences of temporary differences between the income tax and financial reporting bases of
assets and liabilities. Deferred tax liabilities generally represent tax expense recognized for which payment has
been deferred, or expenses which have been deducted in the Companys tax returns but which have not yet been
recognized as an expense in the financial statements. Deferred tax assets generally represent tax deductions or
credits that will be reflected in future tax returns for which the Company has already recorded a tax benefit in its
consolidated financialstatements.
The Company had valuation allowances against deferred income tax assets of $9.8million and $10.7million
at February 3, 2103 and January 29, 2012, respectively, representing the portion of such deferred tax assets
which, as of such dates, management estimated would not be realized. Under generally accepted accounting
principles (GAAP), future realization of deferred tax assets is evaluated under a more likely than not standard.
Realization of net deferred tax assets generally is dependent on generation of taxable income in future periods.
From fiscal 2005 until the fourth quarter of fiscal 2012, the Company maintained a valuation allowance on
deferred tax assets equal to the entire excess of those assets over the Companys deferred income tax liabilities
because of the uncertainty surrounding the realization of those assets. Such uncertainty arose principally from the
substantial losses incurred by the Company from fiscal 2005 though fiscal2009.
The Company reported a pretax profit of $418,000 in fiscal 2010 and $8.9million in fiscal 2011. In fiscal
2012, the Companys pretax profit increased to $30.4million, inclusive of a $6.2million non-recurring gain from
the Companys sale of its 30% interest in KK Mexico. After considering all relevant factors having an impact
assets would be realized in future years and, in accordance with GAAP, reversed $139.6million of the valuation
allowance, with an offsetting credit to the provision for incometaxes.
Two of the most significant factors considered by management in reaching its conclusion were that the
Company earned a significant pretax profit in both fiscal 2011 and 2012 and the positive trend in the Companys
earnings. In fiscal 2013, the Companys pretax income rose to $36.3million.
The evaluation of the amount of net deferred tax assets expected to be realized necessarily involves
forecasting the amount of taxable income that will be generated in future years. In addition, because a substantial
portion of the Companys deferred tax assets consist of net operating loss and tax credit carryforwards that are
subject to expiration, the specific future periods in which taxable income is generated may have a material effect
on the amount of deferred tax assets that ultimately are realized. The Company has forecasted future results using
estimates management believes to be reasonable and which are based on objective verifiable evidence. The most
important factor considered by management in making its forecast was the Companys results of operations for
fiscal 2011, 2012 and 2013. Assuming the Company generates pretax income in each future year approximating
73

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 74

OPERATOR PM10
the Companys average pretax income over the past three years, management estimates that approximately
$116million of its deferred tax assets will be realized in future periods. The decrease in the amount of deferred
income tax assets expected to be realized from January 29, 2012 to February 3, 2013 reflects the realization in
fiscal 2013 of approximately $13million of such assets and the loss of approximately $9.8million of income
tax benefits associated with the expiration in fiscal 2013 of warrants to acquire the Companys common stock
issued in prior years, as more fully described in Note 3 to the consolidated financial statements appearing
elsewhereherein.
The remaining valuation allowance of $9.8million as of February 3, 2013 represents the portion of the
Companys deferred tax assets management estimates will not be realized in the future. Such assets are associated
principally with state net operating loss carryforwards having relatively short carryover periods which are
forecasted to expire unused, as well as federal foreign tax credits and federal jobs credit carryforwards forecasted
to expireunused.
The realization of deferred income tax assets is dependent on future events. While management believes its
forecast of future taxable income is reasonable, actual results inevitably will vary from managements forecasts.
Such variances could result in adjustments to the valuation allowance on deferred tax assets in future periods, and
such adjustments could be material to the financialstatements.
As described above, in making its estimate of the amount of deferred tax assets which will be realized in
future periods, the Company estimated annual future pretax income of approximately $24million. Based on that
estimate, the Company concluded that a valuation allowance on deferred tax assets of $9.8million was appropriate
as of February 3, 2013. A 10% reduction in the amount of assumed future annual pretax income would have had
no material effect on managements determination of the amount of deferred tax valuation allowance. A 20%
reduction in the amount of assumed future annual pretax income would have caused managements determination
of the appropriate valuation allowance to increase from $9.8million to approximately $14.6million. If the
Companys earnings remain at current levels or continue to increase, it is reasonably likely that management would
conclude that its estimate of annual income in future years should increase. For example, if management concluded
that a future annual earnings forecast of $34million, which approximates Fiscal 2013 pretax income measured on
a 52 week basis, were appropriate, then the amount of the deferred tax valuation allowance would be reduced by
approximately $3million, with an offsetting credit to the provision for income taxes. Management believes that
because estimates of future earnings are inherently subjective, and because such estimates necessarily involve
forecasting many years into the future, frequent revisions to such estimates should not be expected. While the
Companys results of operations continued to improve in fiscal 2013 and exceeded managements estimated annual
pretax income for future years of $24million described above, the Company believes that additional evidence is
necessary before concluding that the level of pretax income achieved in fiscal 2013 is sustainable on a long-term
basis. Management believes that such evidence should include, among other things, at least one additional year
of pretax profits substantially in excess of $24million before it would be appropriate for management to revised
upward its estimate of future annual pretax income. As a result, absent the occurrence of some event or events not
currently known, management does not anticipate adjusting its estimate of future earnings until the end of fiscal
2014, although management will revisit this assessment at the end of each quarter of the coming fiscalyear.
While the reversal of a portion of the valuation allowances increased the Companys earnings by
$139.6million in fiscal 2012, the reversal has the effect of increasing the provision for income taxes, and therefore
decreasing net income, beginning in fiscal 2013. This negative effect on earnings occurs because the reversal of
the valuation allowances resulted in the recognition in fiscal 2012 of income tax benefits expected to be realized
in later years. Absent the reversal of the valuation allowances, such tax benefits would have been recognized
when realized in future periods upon the generation of taxable income. Accordingly, beginning in fiscal 2013,
the Companys effective income tax rate, which in fiscal 2012 and earlier years bore little or no relationship to
pretax income, more closely reflects the blended federal and state income tax rates in jurisdictions in which the
Companyoperates.
74
REVISION 4
TYPE Clean
JOB NUMBER 246088
SERIAL <12345678>
PAGE NO. 75

OPERATOR PM10
income tax expense in fiscal 2013 is not comparable to income tax expense in prior years In addition, until such
time as the Companys net operating loss carryforwards are exhausted or expire, GAAP income tax expense is
expected to substantially exceed the amount of cash income taxes payable by the Company, which are expected to
remain insignificant for the foreseeablefuture.
Guarantee Liabilities
The Company has guaranteed a portion of certain loan obligations of certain franchisees in which the
Company owns an interest. The Company assesses the likelihood of making any payments under the guarantees
and records estimated liabilities for anticipated payments when the Company believes that an obligation to perform
under the guarantees is probable and the amount can be reasonably estimated. No liabilities for the guarantees
were recorded at the time they were issued because the Company believed the value of the guarantees was
immaterial. As of February 3, 2013, the Company has recorded liabilities of approximately $1.6million related
to such loan guarantees. The aggregate outstanding principal balance that was guaranteed by the Company was
approximately $2.1million at that date. Assessing the probability of future guarantee payments involves estimates
and assumptions regarding future events, including the future operating results of the franchisees. If future events
are different from those assumed or anticipated, the amounts estimated to be paid pursuant to such guarantees
could change, and additional provisions to record such liabilities could berequired.
Stock-Based Compensation
The Company measures and recognizes compensation expense for share-based payment awards based on
their fair values. Because options granted to employees differ from options on the Companys common shares
traded in the financial markets, the Company cannot determine the fair value of options granted to employees
based on observed market prices. Accordingly, the Company estimates the fair value of stock options subject only
to service conditions using the Black-Scholes option valuation model, which requires inputs including interest
rates, expected dividends, volatility measures and employee exercise behavior patterns. Some of the inputs the
Company uses are not market-observable and must be estimated. In addition, the Company must estimate the
number of awards which ultimately will vest, and periodically adjusts such estimates to reflect actual vesting
events. Use of different estimates and assumptions would produce different option values, which in turn would
affect the amount of compensation expenserecognized.
The Black-Scholes model is capable of considering the specific features included in the options granted to
the Companys employees that are subject only to service conditions. However, there are other models which could
be used to estimate their fair value. If the Company were to use different models, the option values would differ
despite using the same inputs. Accordingly, using different assumptions coupled with using different valuation
models could have a significant impact on the fair value of employee stockoptions.
Item 7A.
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKETRISK.
Interest Rate Risk

The Company is exposed to market risk from increases in interest rates on its outstanding debt. All of the
borrowings under the Companys secured credit facilities bear interest at variable rates based upon either the
lenders prime rate, the Fed funds rate or LIBOR. The interest cost of the Companys debt may be affected by
changes in these short-term interest rates and increases in those rates may adversely affect the Companys results
ofoperations.
On March 3, 2011, the Company entered into an interest rate derivative contract having an aggregate notional
principal amount of $17.5million. The derivative contract entitles the Company to receive from the counterparty
the excess, if any, of the three-month LIBOR rate over 3.00% for each of the calendar quarters in the period
beginning April 2012 and ending December 2015. The Company is accounting for this derivative contract as a
cash flowhedge.
75

JOB NUMBER 246088
REVISION 4
SERIAL <12345678>
TYPE Clean
PAGE NO. 76

OPERATOR PM10
As of February 3, 2013, the Company had approximately $24million in borrowings outstanding. A

hypothetical increase of 100 basis points in short-term interest rates would result in an approximately $240,000
increase in annual interest expense on the Companys term debt. The Company has sought to limit its exposure
to rising short-term interest rates by entering into the derivative contract described above. The Companys credit
facilities and the related interest rate derivative are described in Note 12 to the consolidated financial statements
appearing elsewhereherein.
Currency Risk
The substantial majority of the Companys revenue, expense and capital purchasing activities are transacted
in U.S. dollars. Although royalties from international franchisees are payable to the Company in U.S. dollars,
those royalties are computed based on local currency sales, and changes in the rate of exchange between the
U.S. dollar and the foreign currencies used in the countries in which the international franchisees operate affect
the Companys royalty revenues. Because royalty revenues are derived from a relatively large number of foreign
countries, and royalty revenues are not highly concentrated in a small number of such countries, the Company
believes that the relatively small size of any currency hedging activities would adversely affect the economics
of hedging strategies and, accordingly, the Company historically has not attempted to hedge these exchange
raterisks.
In fiscal 2013, the Companys international franchisees had sales of approximately $423million, and the
Companys related royalty revenues were approximately $23million. A hypothetical 10% change in the average
rate of exchange between the U.S. dollar and the currencies in which the Companys international franchisees do
business would have a corresponding effect on the Companys international royalty revenues of approximately
$2.3million.
Commodity Price Risk
The Company is exposed to the effects of commodity price fluctuations on the cost of ingredients of its
products, of which flour, sugar and shortening are the most significant. In order to secure adequate supplies of
materials and bring greater stability to the cost of ingredients, the Company routinely enters into forward purchase
contracts and other purchase arrangements with suppliers. Under the forward purchase contracts, the Company
commits to purchasing agreed-upon quantities of ingredients at agreed-upon prices at specified future dates. The
outstanding purchase commitment for these commodities at any point in time typically ranges from one months to
two years anticipated requirements, depending on theingredient.
In addition to entering into forward purchase contracts, from time to time the Company purchases exchangetraded commodity futures contracts, and options on such contracts, for raw materials which are ingredients of its
products or which are components of such ingredients, including wheat and soybean oil. The Company typically
assigns the futures contract to a supplier in connection with entering into a forward purchase contract for the
relatedingredient.
The Company operates a large fleet of delivery vehicles and is exposed to the effects of changes in gasoline
prices. The Company periodically uses futures and options on futures to hedge a portion of its exposure to rising
gasolineprices.
Commodity Derivatives Outstanding at February 3, 2013
Quantitative information about the Companys unassigned option contracts and futures contracts and options
on such contracts as of February 3, 2013, which mature in fiscal 2014, is set forth in the tablebelow.
Weighted
Aggregate
Average Contract Price
Contract Price
or Strike Price
or Strike Price
(Dollars in thousands, except average prices)
Contract
Volume
Futures contracts:
Wheat . . . . . . . . . . . . . . . . . . . . . . .
145,000 bu.
76
$8.65
$1,254
Aggregate
Fair Value
$(15)
REVISION 4
SERIAL <12345678>
TYPE Clean
JOB NUMBER 246088
PAGE NO. 77

OPERATOR PM10
Although the Company utilizes forward purchase contracts and futures contracts and options on such
contracts to mitigate the risks related to commodity price fluctuations, such contracts do not fully mitigate price
risk. In addition, the portion of the Companys anticipated future commodity requirements that are subject to such
contracts vary from time to time. Adverse changes in commodity prices could materially adversely affect the
Companys profitability andliquidity.
Sensitivity to Price Changes in Commodities
The following table illustrates the potential effect on the Companys costs resulting from hypothetical
changes in the cost of the Companys three most significant ingredients and in the cost of gasoline used to fuel the
Companys deliveryfleet.
Ingredient
Approximate
Anticipated
Fiscal 2014 Purchases
Approximate Range of
Prices
Paid In Fiscal 2013
Hypothetical Price
Increase
Approximate Annual
Effect Of Hypothetical
Price Increase
(In thousands)
Flour
Shortening
Sugar
Gasoline
70 million lbs.
45 million lbs.
55 million lbs.
3 million gal.
$0.1709 $0.2823/lb.
$0.5410 $0.9456/lb.
$0.4150 $0.4418/lb.
$ 3.36 $4.00/gal.
$0.05/lb.
$0.10/lb.
N/A
$0.30/gal.
$3,500
$4,500
N/A
$ 900
Anticipated fiscal 2014 purchases of flour, shortening and sugar set forth in the preceding table represent
aggregate estimated purchases by KK Supply Chain. Approximately 52% of KK Supply Chains fiscal 2013
sales were to Company Stores, with the remaining 48% of sales made to domestic and international franchisees.
KK Supply Chain adjusts the selling prices of it products quarterly to reflect changes in its input costs. To the
extent KK Supply Chain adjusts selling prices to exactly offset changes in its input costs, the Company, through
its Company Stores segment, is directly exposed to only about half of such changes in KK Supply Chain input
costs. However, to the extent higher selling prices resulting from adverse movements in the cost of agricultural
commodities adversely affect sales by Company franchisees, the Companys financial results could be indirectly
adversely affected by lower KK Supply Chain sales to franchisees, as well as by lower royaltyrevenues.
The ranges of prices paid for fiscal 2013 set forth in the table above reflect the effects of any forward
purchase contracts entered into at various times prior to delivery of the goods and, accordingly, do not necessarily
reflect the ranges of prices of these ingredients prevailing in the market during the fiscalyear.
The Company has fixed the price of its anticipated sugar requirements for fiscal 2014 and accordingly,
hypothetical effects of changes in the price of sugar have been omitted from the foregoingtable.
As of March 2013, the Company has fixed the prices on approximately half of its anticipated fiscal 2014
requirements of flour and approximately 70% of its anticipated fiscal 2014 requirements of shortening at prices not
materially different from prices that prevailed in fiscal2013.
77

JOB NUMBER 246088
Item 8.
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 78

OPERATOR PM10
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

Page
Index to Financial Statements

Report of Independent Registered Public Accounting Firm
Consolidated statement of income for each of the three years in the period ended February 3, 2013
Consolidated statement of comprehensive income for each of the three years in the period
ended February 3, 2013
Consolidated balance sheet as of February 3, 2013 and January 29, 2012
Consolidated statement of cash flows for the each of the three years in the period
Consolidated statement of changes in shareholders equity for each of the three years in the period
Notes to financial statements
78
79
80
81
82
83
84
85
REVISION 4
TYPE Clean
JOB NUMBER 246088
SERIAL <12345678>
PAGE NO. 79

OPERATOR PM10
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders of Krispy Kreme Doughnuts, Inc.
In our opinion, the consolidated financial statements listed in the accompanying index present fairly, in all
material respects, the financial position of Krispy Kreme Doughnuts, Inc. and its subsidiaries (the Company)
at February 3, 2013 and January 29, 2012, and the results of their operations and their cash flows for eachof the
three years in the period ended February 3, 2013 in conformity with accounting principles generally accepted in
the United States of America. In addition, in our opinion, the financial statement schedule listed in Item15(a)2
presents fairly, in all material respects, the information set forth therein when read in conjunction with the
related consolidated financial statements. Also in our opinion, the Company maintained, in all material respects,
effective internal control over financial reporting as of February 3, 2013, based on criteria established in
Internal Control- Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway
Commission (COSO). The Companys management is responsible for these financial statements and the financial
statement schedule, for maintaining effective internal control over financial reporting and for its assessment of the
effectiveness of internal control over financial reporting, included in Managements Report on Internal Control
over Financial Reporting under Item 9A. Our responsibility is to express opinions on these financial statements,
on the financial statement schedule, and on the Companys internal control over financial reporting based on our
integrated audits. We conducted our audits in accordance with the standards of the Public Company Accounting
Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable
assurance about whether the financial statements are free of material misstatement and whether effective internal
control over financial reporting was maintained in all material respects. Our audits of the financial statements
included examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements,
assessing the accounting principles used and significant estimates made by management, and evaluating the
overall financial statement presentation. Our audit of internal control over financial reporting included obtaining
an understanding of internal control over financial reporting, assessing the risk that a material weakness exists,
and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk.
Our audits also included performing such other procedures as we considered necessary in the circumstances. We
believe that our audits provide a reasonable basis for our opinions.
A companys internal control over financial reporting is a process designed to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of financial statements for external purposes in
accordance with generally accepted accounting principles. A companys internal control over financial reporting
includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail,
accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable
assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance
with generally accepted accounting principles, and that receipts and expenditures of the company are being made
only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable
assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the
companys assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect
misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that
controls may become inadequate because of changes in conditions, or that the degree of compliance with the
policies or procedures may deteriorate.
/s/ PricewaterhouseCoopers LLP
Charlotte, North Carolina
April19,2013
79

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 80
OPERATOR PM10

CONSOLIDATED STATEMENT OF INCOME
Year Ended
February 3,
January 29,
January 30,
2013
2012
2011
(In thousands, except per share amounts)
Revenues
Operating expenses:
Direct operating expenses (exclusive of depreciation
and amortization expense shown below)
General and administrative expenses
Depreciation and amortization expense
Impairment charges and lease termination costs
Operating income
Interest income
Interest expense
Loss on refinancing of debt
Equity in income (losses) of equity method franchisees
Gain on sale of interest in equity method franchisee
Other non-operating income and (expense), net
Income before income taxes
Provision for income taxes
Net income
Earnings per common share:
Basic
Diluted
$435,843
$ 403,217
$361,955
362,828
25,089
9,891
306
37,729
114
(1,642)
(202)
317
36,316
15,537
$ 20,779
346,434
22,188
8,235
793
25,567
166
(1,666)
(122)
6,198
215
30,358
(135,911)
$ 166,269
313,475
21,870
7,389
4,066
15,155
207
(6,359)
(1,022)
547
329
8,857
1,258
$ 7,599
$
$
$
$
$
$
0.31
0.30
The accompanying notes are an integral part of the financial statements.

80
2.40
2.33
0.11
0.11

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 81

OPERATOR PM10

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Net income
Other comprehensive income (loss):
Foreign currency translation adjustment
Less income taxes
Unrealized loss on cash flow hedge
Less income taxes
Amortization of unrealized loss on interest rate derivative
Less income taxes
Total other comprehensive income (loss)
Comprehensive income
February 3,
2013
Year Ended
January 29,
2012
(In thousands)
January 30,
2011
$20,779
$166,269
$7,599
(3)
1
(2)
(2)
$20,777
57
(23)
34
(549)
213
(336)
(302)
$165,967
89
(35)
54
152
(60)
92
146
$7,745

81

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 82

OPERATOR PM10

CONSOLIDATED BALANCE SHEET
ASSETS
CURRENT ASSETS:
Cash and cash equivalents
Receivables
Receivables from equity method franchisees
Inventories
Deferred income taxes
Other current assets
Total current assets
Property and equipment
Investments in equity method franchisees
Goodwill and other intangible assets
Other assets
Total assets
February 3,
January 29,
2013
2012
(In thousands)
$ 66,332
25,627
705
12,358
23,323
6,439
134,784
78,024
24,195
93,088
11,847
$ 341,938
$ 44,319
25,467
655
12,646
10,540
3,613
97,240
75,466
23,776
129,053
9,413
$ 334,948
LIABILITIES AND SHAREHOLDERS EQUITY
CURRENT LIABILITIES:
Current maturities of long-term debt
Accounts payable
Accrued liabilities
Total current liabilities
Long-term debt, less current maturities
Other long-term obligations and deferred credits
Commitments and contingencies
SHAREHOLDERS EQUITY:
Preferred stock, no par value; 10,000 shares authorized;
none issued and outstanding
Common stock, no par value; 300,000 shares authorized;
shares issued and outstanding:
February 3, 2013 - 65,356 and January 29, 2012 - 68,092
Accumulated other comprehensive loss
Accumulated deficit
Total shareholders equity
Total liabilities and shareholders equity
2,148
12,198
32,330
46,676
23,595
25,235
354,068
(338)
(107,298)
246,432
$ 341,938

82
2,224
10,494
28,800
41,518
25,369
18,935
377,539
(336)
(128,077)
249,126
$ 334,948

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 83

OPERATOR PM10

CONSOLIDATED STATEMENT OF CASH FLOWS
CASH FLOWS FROM OPERATING ACTIVITIES:

Net income
Adjustments to reconcile net income to net cash provided by
operating activities:
Impairment charges
Accrued rent expense
Loss on disposal of property and equipment
Gain on sale of interest in equity method franchisee
Share-based compensation
Provision for doubtful accounts
Amortization of deferred financing costs
Equity in (income) losses of equity method franchisees
Other
Cash provided by operations
Change in assets and liabilities:
Receivables
Inventories
Other current and non-current assets
Accounts payable and accrued liabilities
Net cash provided by operating activities
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment
Proceeds from disposals of property and equipment
Acquisition of stores from franchisee
Proceeds from sale of interest in equity method franchisee
Escrow deposit
Other investing activities
Net cash used for investing activities
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from the issuance of long-term debt
Repayment of long-term debt
Deferred financing costs
Proceeds from exercise of stock options
Proceeds from exercise of warrants
Repurchase of common shares
Net cash used for financing activities
Net increase in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
Supplemental schedule of non-cash investing and financing activities:
Assets acquired under capital leases
February 3,
2013
Year Ended
January 29,
2012
(In thousands)
January 30,
2011
$ 20,779
$ 166,269
$ 7,599
9,891
13,413
585
543
6,801
194
398
202
(219)
52,587
8,235
(139,403)
60
465
414
(6,198)
6,699
(374)
422
122
676
37,387
7,389
(95)
3,304
(77)
621
5,147
32
1,561
(547)
(567)
24,367
(248)
299
(1,012)
4,740
2,944
59,310
(4,999)
2,275
462
(168)
(1,096)
33,861
(2,583)
(335)
(2,292)
1,468
(117)
20,508
(14,218)
178
(915)
517
(14,438)
(11,884)
44
7,723
1,800
(207)
(2,524)
(9,694)
2,949
(1,800)
(27)
(8,572)
(2,346)
(11)
247
9
(20,758)
(22,859)
22,013
44,319
$ 66,332
(8,991)
(29)
1,036
(1,004)
(8,988)
22,349
21,970
$ 44,319
35,000
(43,257)
(1,348)
5
(581)
(10,181)
1,755
20,215
$ 21,970
516

83
1,197
197

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 84

OPERATOR PM10

CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS EQUITY
Balance at January 31, 2010

Effect of adoption of new accounting
standard (Note 1)
Comprehensive income for the year ended
January 30, 2011
Exercise of warrants
Cancelation of restricted shares
Comprehensive income (loss) for
the year ended January 29, 2012
Exercise of stock options
Cancelation of restricted shares
Comprehensive income (loss) for
the year ended February 3, 2013
Write-off of deferred tax assets related to the
expiration of unexercised stock warrants
Exercise of warrants
Exercise of stock options
Balance at February 3, 2013
Common
Shares
Outstanding
Common
Stock
67,441
$366,237
(2)
161
(73)
67,527
5,147
(581)
370,808
397
(8)
304
(128)
68,092
1,036
6,699
(1,004)
377,539
Accumulated
Other
Comprehensive Accumulated
Income (Loss)
Deficit
(In thousands)
$(180)
$(303,290)
146
(9,770)
9
247
6,801
(20,758)
$354,068
1,345
1,345
7,599
7,745
5
5,147
(581)
76,428
(294,346)
(302)
166,269
(336)
(128,077)
165,967
1,036
6,699
(1,004)
249,126
20,779
20,777
$(338)
$(107,298)

84
$ 62,767
(34)
(2)
1
128
348
(3,213)
65,356
Total
(9,770)
9
247
6,801
(20,758)
$246,432
REVISION 4
JOB NUMBER 246088
TYPE Clean
SERIAL <12345678>
PAGE NO. 85

OPERATOR PM10

NOTES TO FINANCIAL STATEMENTS
Note 1 Accounting Policies
Krispy Kreme Doughnuts, Inc. (KKDI) and its subsidiaries (collectively, the Company) are engaged in
the sale of doughnuts and complementary products through Company-owned stores. The Company also derives
revenue from franchise and development fees and royalties from franchisees. Additionally, the Company sells
doughnut mix, other ingredients and supplies and doughnut-making equipment to franchisees.
Significant Accounting Policies
The Company prepares its financial statements in accordance with accounting principles generally accepted
in the United States of America (GAAP). The significant accounting policies followed by the Company in
preparing the accompanying consolidated financial statements are as follows:
BASIS OF CONSOLIDATION. The financial statements include the accounts of KKDI and its subsidiaries,
the most significant of which is KKDIs principal operating subsidiary, Krispy Kreme Doughnut Corporation.
Investments in entities over which the Company has the ability to exercise significant influence but which
the Company does not control, and whose financial statements are not otherwise required to be consolidated,
are accounted for using the equity method. These entities typically are 25% to 35% owned and are hereinafter
sometimes referred to as Equity Method Franchisees.
REVENUE RECOGNITION.
segments is as follows:
A summary of the revenue recognition policies for the Companys business
Company Stores revenue is derived from the sale of doughnuts and complementary products to on-premises
and wholesale customers. Revenue is recognized at the time of sale for on-premises sales. For wholesale
sales, revenue is recognized at the time of delivery, net of provisions for estimated product returns.
Domestic and International Franchise revenue is derived from development and initial franchise fees
relating to new store openings and ongoing royalties charged to franchisees based on their sales.
Development and franchise fees for new stores are deferred until the store is opened, which is the time
at which the Company has performed substantially all of the initial services it is required to provide.
Royalties are recognized in income as underlying franchisee sales occur unless there is significant
uncertainty concerning the collectibility of such revenues, in which case royalty revenues are recognized
when received.
KK Supply Chain revenue is derived from the sale of doughnut mix, other ingredients and supplies and
doughnut-making equipment. Revenues for the sale of doughnut mix and supplies are recognized upon
delivery to the customer or, in the case of franchisees located outside North America, when the goods are
loaded on the transport vessel at the U.S. port. Revenue for equipment sales and installation associated with
new store openings is recognized at the store opening date. Revenue for equipment sales not associated
with new store openings is recognized when the equipment is installed if the Company is responsible for
the installation, and otherwise upon shipment of the equipment.
FISCAL YEAR. The Companys fiscal year ends on the Sunday closest to January 31, which periodically
results in a 53-week year. Fiscal 2013 contained 53 weeks, while 2012 and 2011 each contained 52 weeks.
CASH AND CASH EQUIVALENTS. The Company considers cash on hand, demand deposits in banks and
all highly liquid debt instruments with an original maturity of three months or less to be cash and cash equivalents.
ALLOWANCE FOR DOUBTFUL ACCOUNTS. The Company maintains allowances for doubtful accounts
related to its accounts receivable, including receivables from franchisees, in amounts which management believes
are sufficient to provide for losses estimated to be sustained on realization of these receivables. Such estimates
inherently involve uncertainties and assessments of the outcome of future events, and changes in facts and
circumstances may result in adjustments to the allowance for doubtful accounts.
85

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 86

OPERATOR PM10

NOTES TO FINANCIAL STATEMENTS(Continued)
INVENTORIES. Inventories are recorded at the lower of cost or market, with cost determined using the
first-in, first-out method.
PROPERTY AND EQUIPMENT. Depreciation of property and equipment is provided using the straightline method over the assets estimated useful lives, which are as follows: buildings 7 to 35 years; machinery and
equipment 3 to 15 years; computer software 3 years; and leasehold improvements 1 to 20 years.
GOODWILL. Goodwill represents the excess of the purchase price over the value of identifiable net
assets acquired in business combinations. Goodwill has an indefinite life and is not amortized, but is tested for
impairment annually or more frequently if events or circumstances indicate the carrying amount of the asset may
be impaired. Such impairment testing is performed for each reporting unit to which goodwill has been assigned.
LEGAL COSTS. Legal costs associated with litigation and other loss contingencies are charged to expense
as services are rendered.
ASSET IMPAIRMENT. When an asset group (typically a store) is identified as underperforming or a
decision is made to abandon an asset group or to close a store, the Company makes an assessment of the potential
impairment of the related assets. The assessment is based upon a comparison of the carrying amount of the asset
group, consisting primarily of property and equipment, to the estimated undiscounted cash flows expected to
be generated from the asset group. To estimate cash flows, management projects the net cash flows anticipated
from continuing operation of the asset group or store until its closing or abandonment as well as cash flows, if
any, anticipated from disposal of the related assets. If the carrying amount of the assets exceeds the sum of the
undiscounted cash flows, the Company records an impairment charge in an amount equal to the excess of the
carrying value of the assets over their estimated fair value.
EARNINGS PER SHARE. The computation of basic earnings per share is based on the weighted average
number of common shares outstanding during the period. The computation of diluted earnings per share reflects
the additional common shares that would have been outstanding if dilutive potential common shares had been
issued, computed using the treasury stock method. Such potential common shares consist of shares issuable upon
the exercise of stock options and warrants and the vesting of currently unvested shares of restricted stock and
restricted stock units.
The following table sets forth amounts used in the computation of basic and diluted earnings per share:
Numerator: net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Denominator:
Basic earnings per share weighted average shares outstanding . . . . .
Effect of dilutive securities:
Stock options and warrants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Restricted stock and restricted stock units . . . . . . . . . . . . . . . . . . . . .
Diluted earnings per share weighted average shares
outstanding plus dilutive potential common shares . . . . . . . . . . . . . .
February 3,
2013
Year Ended
January 29,
2012
(In thousands)
January 30,
2011
$20,779
$166,269
$ 7,599
67,624
69,145
68,337
1,781
491
1,741
611
1,055
530
69,896
71,497
69,922
Stock options and warrants with respect to 2.7 million, 7.6 million and 9.0 million shares, as well as
98,000, 185,000 and 409,000 unvested shares of restricted stock and unvested restricted stock units, have been
excluded from the computation of the number of shares used to compute diluted earnings per share for the years
ended February 3, 2013, January 29, 2012 and January 30, 2011, respectively, because their inclusion would
beantidilutive.
86

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 87

OPERATOR PM10

SHARE-BASED COMPENSATION. The Company measures and recognizes compensation expense for
share-based payment awards by charging the fair value of each award at its grant date to earnings over the service
period necessary for each award to vest.
CONCENTRATION OF CREDIT RISK. Financial instruments that subject the Company to credit risk
consist principally of receivables from wholesale customers and franchisees and guarantees of indebtedness
of franchisees. Wholesale receivables are primarily from grocer/mass merchants and convenience stores. The
Company maintains allowances for doubtful accounts which management believes are sufficient to provide for
losses which may be sustained on realization of these receivables. In fiscal 2013, 2012 and 2011, no customer
accounted for more than 10% of Company Stores segment revenues. The two largest wholesale customers
collectively accounted for approximately 16%, 14% and 13% of Company Stores segment revenues in fiscal 2013,
2012 and 2011, respectively. The two wholesale customers with the largest trade receivables balances collectively
accounted for approximately 24% and 22% of total wholesale customer receivables at February 3, 2013 and
January 29, 2012, respectively.
The Company also evaluates the recoverability of receivables from its franchisees and maintains allowances
for doubtful accounts which management believes are sufficient to provide for losses which may be sustained on
realization of these receivables. In addition, the Company evaluates the likelihood of potential payments by the
Company under loan guarantees and records estimated liabilities for payments the Company considers probable.
SELF-INSURANCE RISKS AND RECEIVABLES FROM INSURERS. The Company is subject to workers
compensation, vehicle and general liability claims. The Company is self-insured for the cost of all workers
compensation, vehicle and general liability claims up to the amount of stop-loss insurance coverage purchased
by the Company from commercial insurance carriers. The Company maintains accruals for the estimated cost
of claims, without regard to the effects of stop-loss coverage, using actuarial methods which evaluate known
open and incurred but not reported claims and consider historical loss development experience. In addition, the
Company records receivables from the insurance carriers for claims amounts estimated to be recovered under
the stop-loss insurance policies when these amounts are estimable and probable of collection. The Company
estimates such stop-loss receivables using the same actuarial methods used to establish the related claims accruals,
and taking into account the amount of risk transferred to the carriers under the stop-loss policies. The stop-loss
policies provide coverage for claims in excess of retained self-insurance risks, which are determined on a
claim-by-claimbasis.
The Company recorded favorable adjustments to its self-insurance claims liabilities related to prior years
of approximately $730,000, $1.3 million and $1.8 million in fiscal 2013, 2012 and 2011, respectively. Such
adjustments represent changes in estimates of the ultimate cost of incurred claims.
The Company provides health and medical benefits to eligible employees, and purchases stop-loss insurance
from commercial insurance carriers which pays covered medical costs in excess of a specified annual amount
incurred by each claimant.
DERIVATIVE FINANCIAL INSTRUMENTS AND DERIVATIVE COMMODITY INSTRUMENTS. The
Company reflects derivative financial instruments, which consist primarily of interest rate derivatives and
commodity futures contracts and options on such contracts, in the consolidated balance sheet at their fair value.
The difference between the cost, if any, and the fair value of the interest rate derivatives is reflected in income
unless the derivative instrument qualifies as a cash flow hedge and is effective in offsetting future cash flows of
the underlying hedged item, in which case such amount is reflected in other comprehensive income. The difference
between the cost, if any, and the fair value of commodity derivatives is reflected in earnings because the Company
has not designated any of these instruments as cash flow hedges.
87

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 88

OPERATOR PM10

FOREIGN CURRENCY TRANSLATION. Until May 2011, the Company had an ownership interest in its
franchisee in Mexico, which was accounted for using the equity method. The functional currency of the franchisee
is the local currency. Assets and liabilities of these operations were translated into U.S. dollars using exchange
rates as of the balance sheet date, and revenues, expenses and the Companys equity in the earnings or losses of
the franchisee are translated using the average exchange rate for the reporting period. The resulting cumulative
translation adjustments were reported, net of income taxes, as a component of accumulated other comprehensive
income. Transaction gains and losses resulting from remeasuring transactions denominated in currencies other
than an entitys functional currency are reflected in earnings. The Company also has an ownership interest in its
franchisee in Western Canada that is accounted for using the equity method. The carrying value of this investment
has been reduced to zero.
COMPREHENSIVE INCOME. Accounting standards on reporting comprehensive income require that
certain items, including foreign currency translation adjustments and mark-to-market adjustments on derivative
contracts accounted for as cash flow hedges (which are not reflected in net income) be presented as components
of comprehensive income. The cumulative amounts recognized by the Company under these standards are
reflected in the consolidated balance sheet as accumulated other comprehensive income, a component of
shareholdersequity.
February 3,
January 29,
2013
2012
(In thousands)
Accumulated other comprehensive loss:

Unrealized losses on interest rate derivatives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less: deferred income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$(552)
214
$(338)
$(549)
213
$(336)
USE OF ESTIMATES. The preparation of financial statements in conformity with GAAP requires
management to make estimates and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts
of revenues and expenses during the reporting period. Actual results will differ from these estimates, and the
differences could be material.
CORRECTION OF BALANCE SHEET CLASSIFICATION ERROR. The Companys KK Supply Chain
transfers doughnut mixes and certain other goods to third-party distribution companies which, in turn, distribute
such products to Company and franchise stores pursuant to distribution contracts with KK Supply Chain. The
Company does not record revenues or profit on the product transfers to the distribution companies because all
revenue recognition criteria are not met at that time. Revenues and profit are recorded only upon the delivery of the
goods to the stores by the distribution companies (and the sales to Company shops are eliminated in consolidation).
In the fourth quarter of fiscal 2013, the Company concluded that certain of the Companys receivables from
third-party distribution companies resulting from the product transfers had been incorrectly reported as a
component of inventories, rather than as a component of receivables, in prior periods. The Company corrected
this classification error as of February 3, 2013. While not material to previously issued financial statements, to
enhance comparability, the Company corrected the corresponding error as of January 29, 2012, by revising the
classification of $3.9 million of receivables from the distribution companies previously classified as inventories to
receivables. The error also affected the change in inventories and change in receivables line items in the statement
of cash flows in prior periods, but there was no effect on net cash provided by operating activities. The Company
revised its statement of cash flows to adjust the increase in receivables from $862,000 to $4,999,000 and to adjust
the increase in inventories from $1,862,000 to a decrease of $2,275,000 in fiscal 2012, and to adjust the increase
in receivables from $2,604,000 to $2,583,000 and to adjust the increase in inventories from $314,000 to $335,000
in fiscal 2011. Correction of this error had no effect on the Companys results of operations, total current assets,
working capital, or total operating, investing, or financing cash flows.
88
REVISION 4
TYPE Clean
JOB NUMBER 246088
SERIAL <12345678>
PAGE NO. 89

OPERATOR PM10

Recent Accounting Pronouncements
In February 2013, the FASB issued guidance requiring an entity to provide information about the amounts
reclassified out of accumulated other comprehensive income (AOCI) by component. In addition, an entity is
required to present, either on the face of the financial statements or in the notes, significant amounts reclassified
out of AOCI by the respective line items of net income, but only if the amount reclassified is required to be
reclassified in its entirety in the same reporting period. For amounts that are not required to be reclassified in their
entirety to net income, an entity is required to cross-reference to other disclosures that provide additional details
about those amounts. This guidance is effective for the Company in the first quarter of fiscal 2014, but adoption of
the guidance is not expected to have a material effect on the Companys consolidated financial statements.
In July 2012, the FASB issued amended accounting guidance regarding indefinite-lived intangible asset
impairment testing. The amended guidance permits, but does not require, an entity to first assess qualitative
factors to determine whether it is necessary to perform a quantitative impairment test. An entity would not be
required to calculate the fair value of an indefinite-lived intangible asset unless the entity determines, based on
qualitative assessment, that it is not more likely than not, the indefinite-lived intangible asset is impaired. This
guidance is effective for the Company in fiscal 2014, with early adoption permitted. The Company does not expect
adoption of this new guidance will have a material effect on its financial position or results of operations.
In June 2011, the FASB issued new accounting standards which require an entity to present the total of
comprehensive income, the components of net income, and the components of other comprehensive income either
in a single continuous statement of comprehensive income, or in two separate but consecutive statements. The
Company adopted the new standards in fiscal 2013 and elected to present a statement of comprehensive income
separate from the statement of income.
In May 2011, the FASB issued an Accounting Standards Update (ASU) related to fair value measurements.
The ASU clarifies some existing concepts, eliminates wording differences between GAAP and International
Financial Reporting Standards (IFRS), and in some limited cases, changes some principles to achieve
convergence between GAAP and IFRS. The ASU also expands the disclosures for fair value measurements that
are estimated using significant unobservable (Level 3) inputs. The ASU was effective for the Company in fiscal
2013. Adoption of the new accounting standards had no material effect on the Companys financial condition or
results of operations.
Effective February 1, 2010, the first day of fiscal 2011, the Company was required to adopt new accounting
standards related to the consolidation of variable interest entities (VIE). Those standards require an enterprise to
qualitatively assess whether it is the primary beneficiary of a VIE based on whether the enterprise has the power
to direct matters that most significantly impact the activities of the VIE and has the obligation to absorb losses of,
or the right to receive benefits from, the VIE that could potentially be significant to the VIE. An enterprise must
consolidate the financial statements of VIEs of which it is the primary beneficiary. Under the new accounting
standards, the Company was no longer the primary beneficiary of its franchisee in northern California, which
required the Company to deconsolidate the franchisee and recognize a divestiture of the three stores the Company
sold to the franchisee in the third quarter of fiscal 2010. The cumulative effect of adoption of the new standards
has been reflected as a $1.3 million credit to the opening balance of retained earnings as of February 1, 2010.
Adoption of the standards had no material effect on the Companys financial position, results of operations or cash
flows.
Note 2 Segment Information
The Companys reportable segments are Company Stores, Domestic Franchise, International Franchise and
KK Supply Chain. The Company Stores segment is comprised of the stores operated by the Company. These
stores sell doughnuts and complementary products through both on-premises and wholesale channels, although
some stores serve only one of these distribution channels. The Domestic Franchise and International Franchise
89

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 90

OPERATOR PM10

segments consist of the Companys franchise operations. Under the terms of franchise agreements, domestic and
international franchisees pay royalties and fees to the Company in return for the use of the Krispy Kreme name
and ongoing brand and operational support. Expenses for these segments include costs to recruit new franchisees,
to assist in store openings, to support franchisee operations and marketing efforts, as well as allocated corporate
costs. The majority of the ingredients and materials used by Company stores are purchased from the KK Supply
Chain segment, which supplies doughnut mix, other ingredients and supplies and doughnut making equipment to
both Company and franchisee-owned stores.
All intercompany sales by the KK Supply Chain segment to the Company Stores segment are at prices
intended to reflect an arms-length transfer price and are eliminated in consolidation. Operating income for
the Company Stores segment does not include any profit earned by the KK Supply Chain segment on sales of
doughnut mix and other items to the Company Stores segment; such profit is included in KK Supply Chain
operating income.
The following table presents the results of operations of the Companys operating segments for fiscal 2013,
2012 and 2011. Segment operating income is consolidated operating income before unallocated general and
administrative expenses and impairment charges and lease termination costs.
February 3,
2013
Revenues:
Company Stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Domestic Franchise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
International Franchise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
KK Supply Chain:
Total revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less intersegment sales elimination . . . . . . . . . . . . . . . . . . . . .
External KK Supply Chain revenues . . . . . . . . . . . . . . . . . . .
Total revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Company Stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
KK Supply Chain . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total segment operating income . . . . . . . . . . . . . . . . . . . . . . . . .
(including depreciation and amortization expense) . . . . . . . . . . .
Impairment charges and lease termination costs . . . . . . . . . . . . . . . .
Consolidated operating income . . . . . . . . . . . . . . . . . . . . . . . . . .
Depreciation and amortization expense:
Company Stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
KK Supply Chain . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Corporate administration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total depreciation and amortization expense . . . . . . . . . . . . . . .
90
Year Ended
January 29,
2012
(In thousands)
January 30,
2011
$ 296,494
10,325
24,941
$ 271,657
9,463
22,621
$245,841
8,527
18,282
215,412
(111,329)
104,083
$ 435,843
206,453
(106,977)
99,476
$ 403,217
181,594
(92,289)
89,305
$361,955
$ (4,238)
3,498
12,331
30,213
41,804
8,534
5,590
17,387
32,450
63,961
284
3,737
15,054
30,160
49,235
(25,926)
(306)
$ 37,729
(22,875)
(793)
$ 25,567
(22,583)
(4,066)
$ 15,155
8,142
164
10
738
837
9,891
6,593
219
6
730
687
8,235
5,641
220
7
808
713
7,389

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 91

OPERATOR PM10

Segment information for total assets and capital expenditures is not presented as such information is not used
in measuring segment performance or allocating resources among segments.
Revenues for fiscal 2013, 2012 and 2011 include approximately $44 million, $42 million and $37 million,
respectively, from customers outside the United States.
Note 3 Income Taxes
The components of the provision for income taxes are as follows:
February 3,
2013
Current, including $1,492 from the sale of interest in KK Mexico

in fiscal 2012. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 2,124
13,413
$15,537
Year Ended
January 29,
2012
(In thousands)
3,492
(139,403)
$(135,911)
January 30,
2011
$1,353
(95)
$1,258
A reconciliation of the tax provision computed at the statutory federal income tax rate and the Companys
provision for income taxes follows:
Income taxes at statutory federal rate . . . . . . . . . . . . . . . . . . . . . . . . . .

State income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Realization of net deferred tax assets subject to valuation allowance. . .
Reversal of valuation allowance on deferred income tax assets . . . . . .
Accruals for uncertain tax positions . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accruals for interest and penalties. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Foreign tax on sale of interest in KK Mexico . . . . . . . . . . . . . . . . . . . .
Other foreign taxes, principally withholding taxes. . . . . . . . . . . . . . . .
Deduction for foreign income taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other changes in tax credit carryforwards. . . . . . . . . . . . . . . . . . . . . . .
Change in estimated future blended state income tax rate . . . . . . . . . .
Other. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
February 3,
2013
Year Ended
January 29,
2012
(In thousands)
January 30,
2011
$12,710
1,285
(50)
(82)
2,168
(759)
(86)
(565)
916
$15,537
$ 10,625
1,000
(15,061)
(139,593)
241
(30)
1,492
1,764
(1,125)
20
3,749
1,007
$(135,911)
$ 3,100
898
(3,835)
(50)
(64)
1,513
(530)
(36)
262
$ 1,258
The Company recognizes deferred income tax assets and liabilities based upon managements expectation
of the future tax consequences of temporary differences between the income tax and financial reporting bases of
assets and liabilities. Deferred tax liabilities generally represent tax expense recognized for which payment has
been deferred, or expenses which have been deducted in the Companys tax returns but which have not yet been
recognized as an expense in the financial statements. Deferred tax assets generally represent tax deductions or
credits that will be reflected in future tax returns for which the Company has already recorded a tax benefit in its
consolidated financial statements.
91

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 92

OPERATOR PM10

The tax effects of temporary differences are as follows:
February 3,
January 29,
2013
2012
(In thousands)
Deferred income tax assets:

Goodwill and other intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Allowance for doubtful accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Property and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other non-current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Insurance accruals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accrued litigation settlement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other non-current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Non-employee stock warrants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Share-based compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Federal net operating loss carryforwards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Federal tax credit carryforwards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Charitable contributions carryforward . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
State net operating loss and credit carryforwards . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Gross deferred income tax assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Valuation allowance on deferred income tax assets . . . . . . . . . . . . . . . . . . . . . . .
Deferred income tax assets, net of valuation allowance . . . . . . . . . . . . . . . . .
Deferred income tax liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net deferred income tax assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
8,797
239
1,195
4,071
3,701
3,662
2,193
7,270
3,190
9,771
63,767
4,932
224
12,648
518
126,178
(9,767)
116,411
$116,411
$ 13,060
449
1,585
2,194
3,161
3,609
1,841
6,718
7,174
2,239
2,596
7,984
76,070
6,224
789
13,938
614
150,245
(10,652)
139,593
$139,593
The Company establishes valuation allowances for deferred income tax assets in accordance with GAAP,
which provides that such valuation allowances shall be established unless realization of the income tax benefits is
more likely thannot.
The Company had valuation allowances against deferred tax assets of $9.8million and $10.7million at
February 3, 2013 and January 29, 2012, respectively, representing the portion of such deferred tax assets which,
as of such dates, management estimated would not be realized in future periods. Under GAAP, future realization
of deferred tax assets is evaluated under a more likely than not standard. Realization of net deferred tax assets
generally is dependent on generation of taxable income in future periods. From fiscal 2005 until the fourth
quarter of fiscal 2012, the Company maintained a valuation allowance on deferred tax assets equal to the entire
excess of those assets over the Companys deferred income tax liabilities because of the uncertainty surrounding
the realization of those assets. Such uncertainty arose principally from of the substantial losses incurred by the
Company from fiscal 2005 through fiscal2009.
The Company reported a pretax profit of $418,000 in fiscal 2010 and $8.9million in fiscal 2011. In fiscal
2012, the Companys pretax profit increased to $30.4million, inclusive of a $6.2million non-recurring gain on the
Companys sale of its 30% interest in KK Mexico. After considering all relevant factors and objectively verifiable
evidence having an impact on the likelihood of future realization of the Companys deferred tax assets, in the
fourth quarter of fiscal 2012 management concluded that it was more likely than not that a substantial portion
of the Companys deferred tax assets would be realized in future years. Accordingly, the Company reversed
92

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 93

OPERATOR PM10

$139.6million of the valuation allowance on deferred tax assets, with an offsetting credit to the provision for
income taxes. In addition, during fiscal 2012 the Company realized approximately $15.1million of additional
deferred tax assets, principally from the utilization of net operating loss carryovers to offset fiscal 2012
taxableincome.
The valuation allowance of $9.8million as of February 3, 2013 represents the portion of the Companys
deferred tax assets management estimates will not be realized in the future. Such assets are associated principally
with state net operating loss and state credit carryforwards having relatively short carryforward periods which are
forecasted to expire unused, as well as federal foreign tax credits and federal jobs credit carryforwards forecasted
to expire unused. During fiscal 2013, the Companys gross deferred tax assets and the related valuation allowance
were each reduced in the amount of $885,000 as a result of the Companys amendment of a prior year income tax
return; the amendment had no effect on the Companys net deferred taxassets.
The realization of deferred income tax assets is dependent on future events. While management believes its
forecast of future taxable income is reasonable, actual results inevitably will vary from managements forecasts.
Such variances could result in adjustments to the valuation allowance on deferred tax assets in future periods, and
such adjustments could be material to the financialstatements.
The changes in the valuation allowance on deferred income tax assets are summarized asfollows:
Valuation allowance on deferred taxassets:

Balance at beginning of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Reduction in allowance due to amendment of tax return . . . . . . . . . . .
Realization of net deferred tax assets subject to valuation allowance . . .
Reversal of allowance credited to earnings . . . . . . . . . . . . . . . . . . . . . .
Balance at end of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
February 3,
2013
Year Ended
January 29,
2012
(Inthousands)
January 30,
2011
$10,652
(885)
$ 9,767
$ 165,306
(15,061)
(139,593)
$ 10,652
$169,141
(3,835)
$165,306
Deferred income tax assets and liabilities are reflected in the accompanying consolidated balance sheet
asfollows:
February 3,
January 29,
2013
2012
(Inthousands)
Net current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Net noncurrent assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net asset . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 23,323
93,088
$116,411
$ 10,540
129,053
$139,593
The Company has approximately $183million of federal income tax loss carryforwards expiring in fiscal
2026 through 2031. In addition to this amount, the Company has approximately $23million of federal income tax
loss carryforwards resulting from tax deductions related to stock options and other equity awards to employees,
the tax benefits of which, if subsequently realized, will be recorded as additions to common stock. The Company
also has state income tax loss carryforwards expiring in fiscal 2014 through 2031. The Company has $4.9million
of federal tax credit carryforwards expiring in fiscal 2014 through 2031, principally consisting of federal foreign
tax credit carryforwards. The Company also has approximately $415,000 of state income tax credit carryforwards
expiring in fiscal 2014 through2026.
93

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 94

OPERATOR PM10

In fiscal 2008, the Company issued warrants to acquire shares of the Companys common stock at prices
of $12.21 per share as more fully described in Note 15. The warrants expired unexercised in the first quarter of
fiscal 2013. Accordingly, the Company will not be entitled to any income tax deductions related to them. Deferred
tax assets at January 29, 2012 included approximately $7.2million related to these warrants. In accordance with
GAAP, such amounts were charged to common stock in the first quarter of fiscal 2013 because common stock in
the accompanying consolidated balance sheet includes cumulative credits related to share based compensation in
excess of suchamounts.
In fiscal 2006, the Company issued a warrant to acquire shares of the Companys common stock at prices
of $7.75 as more fully described in Note 15. The warrant expired unexercised in the fourth quarter of fiscal 2013.
Accordingly, the Company will not be entitled to any income tax deductions related to it. Deferred tax assets
at January 29, 2012 included approximately $2.6million related to the warrant. In accordance with GAAP,
such amounts were charged to common stock in the fourth quarter of fiscal 2013 because common stock in the
accompanying consolidated balance sheet includes cumulative credits related to share based compensation in
excess of suchamounts.
The Company is subject to U.S. federal income tax, as well as income tax in multiple U.S. state and local
jurisdictions and a limited number of foreign jurisdictions. The Companys income tax returns periodically are
examined by the Internal Revenue Service (the IRS) and by other tax authorities in various jurisdictions. The
Company assesses the likelihood of adverse outcomes resulting from these examinations in determining the
provision for income taxes. Generally, the IRS and other tax authorities are permitted to examine the Companys
income tax returns and propose adjustments to those returns for a three year period following the filing of the
returns, and thereafter are barred by the statute of limitations from proposing adjustments to the returns. An
important exception is that the tax authorities may challenge a deduction for a loss carryforward in the year in
which the carryforward is utilized (which may be many years following the year in which the loss was incurred),
unless the tax authorities previously have examined the tax return for the loss year. The IRS is currently
examining the Companys federal income tax return for fiscal 2010. With the exception of the current examination,
the IRS has not examined the Companys federal income tax returns for years subsequent to fiscal 2004. The
Companys fiscal 2006 through fiscal 2012 tax returns (and the fiscal 2013 return, when filed) are subject to
examination by the IRS, notwithstanding the statute of limitations, because fiscal 2006 through fiscal 2009 were
loss years (as was fiscal 2011). Losses incurred in such years constitute substantially all of the Companys federal
tax loss carryovers. A substantial portion of the Companys state net operating loss carryforwards remain subject
to examination by state tax authorities for similarreasons.
Income tax payments, net of refunds, were $2.3million, $3.3million and $1.0million in fiscal 2013, 2012
and 2011, respectively. The tax payments in all three fiscal years were comprised largely of foreign withholding
taxes on revenues received from foreign franchisees. The fiscal 2012 tax payments also reflect approximately
$1.5million of Mexican taxes arising from the Companys sale of its 30% equity interest in KK Mexico described
in Note 8. The fiscal 2011 amount is net of a federal income tax refund of $560,000 resulting from enactment of
the Worker, Homeownership and Business Assistance Act of2009.
The Company had $1.2million of unrecognized tax benefits as of February 3, 2013, all of which, if
subsequently recognized, would be recorded as a credit to income taxexpense.
94

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 95

OPERATOR PM10

The following table presents a reconciliation of the beginning and ending amounts of unrecognized
taxbenefits:
Unrecognized tax benefits at beginning of year . . . . . . . . . . . . . . . . . . . . .

Increases related to positions taken in the current year. . . . . . . . . . . . . . . .
Increases (decreases) related to positions taken in prior years . . . . . . . . . .
Lapsing of statutes of limitations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Unrecognized tax benefits at end of year. . . . . . . . . . . . . . . . . . . . . . . . . . .
February 3,
2013
Year Ended
January 29,
2012
(Inthousands)
January 30,
2011
$1,165
128
(116)
$1,177
$1,365
102
(10)
(292)
$1,165
$1,883
85
28
(631)
$1,365
The amount of unrecognized tax benefits may decrease in fiscal 2014 due to the lapsing of statutes of
limitations. The total amount of unrecognized tax benefits is not expected to change materially in fiscal 2014, and
any such changes, if recognized, are not expected to have any material effect on income taxexpense.
The Companys policy is to recognize interest and penalties related to income tax issues as components
of income tax expense. The Companys balance sheet reflects approximately $295,000 and $380,000 of accrued
interest and penalties as of February 3, 2013 and January 29, 2012,respectively.
Note 4 Receivables
The components of receivables are asfollows:
February 3,
January 29,
2013
2012
(Inthousands)
Receivables:
Wholesale customers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Unaffiliated franchisees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Due from third-party distributors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Current portion of notes receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less allowance for doubtfulaccounts:
Wholesale customers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Unaffiliated franchisees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Receivables from Equity Method Franchisees (Note8):

Trade . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
95
$11,244
9,728
3,590
1,216
464
26,242
$10,169
11,405
3,851
1,015
185
26,625
(373)
(242)
(615)
$25,627
(349)
(809)
(1,158)
$25,467
705
655
REVISION 4
TYPE Clean
JOB NUMBER 246088
SERIAL <12345678>
PAGE NO. 96

OPERATOR PM10

The changes in the allowances for doubtful accounts are summarized asfollows:
Allowance for doubtful accounts related toreceivables:

Provision for doubtful accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net recoveries (chargeoffs) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Transfers to allowances for notes receivable (Note10) . . . . . . . . . . . .
Allowance for doubtful accounts related to receivables
from Equity Method Franchisees:
Provision for doubtful accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net recoveries (chargeoffs) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Transfers to allowances for notes receivable (Note10) . . . . . . . . . . . .
February 3,
2013
Year Ended
January 29,
2012
(Inthousands)
January 30,
2011
$1,158
259
(802)
$ 615
$1,334
65
(241)
$1,158
$1,343
362
(224)
(147)
$1,334
$ 739
(35)
(233)
(471)
$
(59)
59
(27)
27
See Note 10 for information about notes receivable fromfranchisees.

Note 5 Inventories
The components of inventories are asfollows:
February 3,
January 29,
2013
2012
(Inthousands)
Raw materials. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Work in progress. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Finished goods and purchased merchandise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 5,678
52
6,628
$12,358
$ 5,306
89
7,251
$12,646
Note 6 Other Current Assets

Other current assets consist of thefollowing:
February 3,
January 29,
2013
2012
(Inthousands)
Current portion of claims against insurance carriers related to self-insurance

programs (Notes 1, 10, 11 and13). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Closed stores held for sale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Agricultural commodity futures contracts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Prepaid expenses and other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
96
$1,194
742
4,503
$6,439
$ 561
21
3,031
$3,613

JOB NUMBER 246088
REVISION 4
SERIAL <12345678>
TYPE Clean
PAGE NO. 97

OPERATOR PM10

Note 7 Property and Equipment
Property and equipment consists of thefollowing:
February 3,
January 29,
2013
2012
(Inthousands)
Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Buildings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Leasehold improvements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Machinery and equipment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Computer software. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Construction in progress . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less: accumulated depreciation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 13,641
63,152
13,366
51,357
6,422
1,662
149,600
(71,576)
$ 78,024
$ 13,842
64,310
11,610
51,100
6,856
378
148,096
(72,630)
$ 75,466
Machinery and equipment includes assets acquired under capital leases having a net book value of $364,000
and $674,000 at February 3, 2013 and January 29, 2012, respectively. Buildings acquired under capital leases have
a net book value of $971,000 and $543,000 at February 3, 2013 and January 29, 2012, respectively. Depreciation
expense was $9.9million, $8.2million and $7.4million in fiscal 2013, 2012, and 2011,respectively.
Note 8 Investments in Franchisees
As of February 3, 2013, the Company had investments in three franchisees. These investments were
made in the form of capital contributions and, in certain instances, loans evidenced by promissory notes. These
investments are reflected as Investments in equity method franchisees in the consolidated balancesheet.
Information about the Companys ownership in the Equity Method Franchisees and the markets served by
those franchisees is set forthbelow:
Kremeworks, LLC . . . . . . . . . . . . . . . . . . .
Kremeworks Canada, LP. . . . . . . . . . . . . .
Krispy Kreme of South Florida, LLC . . . .
Geographic Market
Number of
Stores as of
February 3,
2013
Alaska, Hawaii, Oregon,

Washington
Western Canada
South Florida
9
1
3
97
Ownership%
Company
Third Parties
25.0%
24.5%
35.3%
75.0%
75.5%
64.7%

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 98

OPERATOR PM10

The Companys financial exposures related to franchisees in which the Company has an investment are
summarized in the tablesbelow.
February 3, 2013
Investments
and
Advances
Kremeworks, LLC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Kremeworks Canada, LP. . . . . . . . . . . . . . . . . . . . . . . . . . . .
Krispy Kreme of South Florida, LLC . . . . . . . . . . . . . . . . . .
Less: reserves and allowances . . . . . . . . . . . . . . . . . . . . . . . .
$ 900
900
(900)
$
Notes
Receivables
Receivable
(Inthousands)
$281
20
404
705
$705
Loan
Guarantees
$ 437
1,628
$2,065
January 29, 2012

Investments
and
Advances
Kremeworks, LLC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Kremeworks Canada, LP. . . . . . . . . . . . . . . . . . . . . . . . . . . .
Krispy Kreme of South Florida, LLC . . . . . . . . . . . . . . . . . .
Less: reserves and allowances . . . . . . . . . . . . . . . . . . . . . . . .
$ 900
900
(900)
$
Notes
Receivables
Receivable
(Inthousands)
$308
20
327
655
$655
Loan
Guarantees
$ 739
1,946
$2,685
The loan guarantee amounts in the preceding tables represent the portion of the principal amount outstanding
under the related loan that is subject to the Companysguarantee.
The Company has a 25% interest in Kremeworks, LLC (Kremeworks), and has guaranteed 20% of the
outstanding principal balance of certain of Kremeworks bank indebtedness, which as amended, matures in
October 2013. The aggregate amount of such indebtedness was approximately $2.2million at February 3,2013.
Current liabilities at February 3, 2013 and January 29, 2012 include accruals for potential payments under
loan guarantees of approximately $1.6 million and $1.9 million, respectively, related to Krispy Kreme of South
Florida, LLC (KKSF). The underlying indebtedness matured by its terms in October 2009. Such maturity had
been extended on a month-to-month basis pursuant to an informal agreement between KKSF and the lender. In
October 2012, KKSF received notice that the original lender had sold the loan to a new lender. The new lender has
advised KKSF that the entire balance due under the loan is currently due and owing, but has not made demand
for payment on KKSF. KKSF is seeking modifications of the loan agreement from the new lender to extend the
maturity of the loan and, as an alternative, is seeking replacement financing from other lenders to refinance the
balance of the loan. There was no liability reflected in the financial statements for the guarantee of Kremeworks
debt because the Company did not believe it was probable that the Company would be required to perform under
that guarantee. While there is no current demand on the Company to perform under either of the guarantees, there
can be no assurance that the Company will not be required to perform and, if circumstances change from those
prevailing at February 3, 2013, additional guarantee payments or provisions for guarantee payments could be
required with respect to either of the guarantees, and such payments or provisions could be significant.
98
REVISION 4
TYPE Clean
JOB NUMBER 246088
SERIAL <12345678>
PAGE NO. 99

OPERATOR PM10

In December 2011, the Company, KKSF and KKSFs majority owner entered into a restructuring agreement
pursuant to which KKSF is to pay to the Company past due amounts totaling approximately $825,000, all of
which the Company had written off in prior years. KKSF paid a total of $180,000 of such amount following the
execution of the agreement, and is to commence repayment of the remaining amount not later than January 2014.
All amounts paid under the agreement will be recorded as bad debt recoveries. At such time as KKSF has paid
all the agreed upon amounts and the Company has been released from all guarantees of KKSF indebtedness (and
the Company has been reimbursed for any and all amounts paid by the Company pursuant to the guarantees), the
Company has agreed to convey to KKSFs majority owner all of the Companys membership interests in KKSF,
provided that neither KKSF nor its majority owner are then in default under any agreement between either of them
and the Company.
The following table summarizes the Companys obligations under the loan guarantees as of February 3, 2013,
and the scheduled expiration of these obligations in each of the next five fiscal years and thereafter. The amounts
shown as the scheduled expiration of the guarantees are based upon the scheduled maturity of the underlying
guaranteed obligation.
Kremeworks, LLC
Krispy Kreme of
South Florida, LLC
Amounts Expiring in Fiscal Year

2015
2016
2017
2018
(In thousands)
Guarantee
Percentages
Total Loan
Guarantees
2014
20%
$ 437
$ 437
100%
1,628
$2,065
1,628
$2,065
Thereafter
On May 5, 2011, the Company sold its 30% equity interest in Krispy Kreme Mexico, S. de R.L. de C.V. (KK
Mexico), the Companys franchisee in Mexico, to KK Mexicos majority shareholder. The Company received
cash proceeds of approximately $7.7 million in exchange for its equity interest and, after deducting costs of the
transaction, realized a gain of approximately $6.2 million on the disposition. After provision for payment of
Mexican income taxes related to the sale of approximately $1.5 million, the Company reported an after tax gain
on the disposition of approximately $4.7 million in the second quarter of fiscal 2012. The net after tax proceeds
of the sale of approximately $6.2 million were used to prepay a portion of the outstanding balance of the 2011
TermLoan.
In connection with the Companys sale of its KK Mexico interest, KK Mexico paid approximately $765,000
of amounts due to the Company which were evidenced by promissory notes, relating principally to past due
royalties and fees due to the Company. As a consequence of this payment, in the first quarter of fiscal 2012, the
Company reversed an allowance for doubtful notes receivable of approximately $391,000 and recorded royalty
99

JOB NUMBER 246088
REVISION 4
SERIAL <12345678>
TYPE Clean
PAGE NO. 100

OPERATOR PM10

and franchise fee income of approximately $280,000 and $95,000 respectively. The reserve had previously been
established, and the royalties and fees had not previously been recognized as revenue, because of uncertainty
surrounding the collection of these amounts.
Summary Financial Information (1)
Revenues
Kremeworks, LLC
2013 $17,383
2012 17,731
2011 16,984
Kremeworks Canada, LP
2013
1,516
2012
1,438
2011
1,399
Krispy Kreme of South
Florida, LLC
2013 13,271
2012 13,201
2011 12,554
Krispy Kreme Mexico,
S. de R.L de C.V.
2011 18,616
Operating
Income
(Loss)
Net Income
(Loss) (2)
$ (561)
(1,056)
(1,736)
1
(180)
327
Total
Equity
(Deficit)
Current Noncurrent
Assets
Assets
(In thousands)
Current Noncurrent
Liabilities Liabilities
$ (781)
(1,325)
(2,036)
$1,083
1,037
1,069
$10,622
12,380
14,051
$ 8,438
10,109
11,203
$1,883
1,887
1,957
(106)
(282)
231
534
524
446
1,247
1,401
1,564
3,795
3,674
3,505
(2,014)
(1,749)
(1,495)
1,421
844
1,461
1,290
(1,008)
1,274
1,182
948
1,030
3,182
2,378
4,730
3,418
3,449
4,113
1,754
1,407
4,612
(808)
(1,530)
(2,965)
2,035
1,889
4,591
6,128
3,356
166
$ 1,384
1,421
1,960
7,197
(1) Amounts shown for each of these franchisees represents the amounts reported by the franchisee for calendar
2012, 2011 and 2010, and on or about December 31, 2012, 2011 and 2010.
(2) The net income or loss of each of these entities is includable on the income tax returns of their owners to the
extent required by law. Accordingly, the financial statements of these entities do not include a provision for
income taxes and as a result pretax income or loss for each of these entities is also their net income or loss.
Note 9 Goodwill and Other Intangible Assets
Goodwill and other intangible assets consist of the following:
February 3,
January 29,
2013
2012
(In thousands)
Goodwill:
Goodwill associated with International Franchise segment
Goodwill associated with Domestic Franchise segment
Goodwill associated with Company Stores segment, net of accumulated
impairment losses of $139.4 million
Reacquired franchise rights associated with Company Stores segment,
net of accumulated impairment losses of $1.8 million and accumulated
amortization of $24 in fiscal 2013
100
$15,664
7,832
$15,664
7,832
699
$24,195
280
$23,776

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 101

OPERATOR PM10

On August 30, 2012, the Company acquired the assets and operations of one of its franchisees in exchange
for $915,000 cash as more fully described in Note 21. The allocation of the purchase price included $443,000
allocated to reacquired franchise rights, which is being amortized over the remaining life of the franchise
agreement of approximately eight years.
Note 10 Other Assets
The components of other assets are as follows:
February 3,
January 29,
2013
2012
(In thousands)
Non-current portion of claims against insurance carriers

related to self-insurance programs (Notes 1, 6, 11 and 13)
Deposits
401(k) mirror plan assets (Notes 13 and 19)
Non-current portion of notes receivable
Deferred financing costs, net of accumulated amortization
Interest rate derivative
Other
$ 4,486
2,709
1,816
1,212
1,077
16
531
$11,847
$2,955
2,837
1,039
524
1,464
53
541
$9,413
The Company has notes receivable from certain of its franchisees which are summarized in the following
table. As of February 3, 2013 and January 29, 2012, substantially all of the notes receivable were being paid in
accordance with their terms.
February 3,
January 29,
2013
2012
(In thousands)
Notes receivable:
Note receivable from franchisees, net of deferred gain of $1.7 million (Note 21)
Less portion due within one year (Note 4)
Less allowance for doubtful accounts
$1,738
(464)
(62)
$1,212
$ 777
(185)
(68)
$ 524
The changes in the allowance for doubtful accounts related to notes receivable are summarized as follows:
Balance at beginning of year

Provision for doubtful accounts
Net recoveries (chargeoffs)
Transfers from allowances for trade receivables (Note 4)
Balance at end of year
February 3,
2013
Year Ended
January 29,
2012
(In thousands)
January 30,
2011
$ 68
(6)
$62
$ 538
(412)
(58)
$ 68
$ 129
(295)
86
618
$ 538
In addition to the foregoing notes receivable, the Company had promissory notes totaling approximately $3.3
million at February 3, 2013 and January 29, 2012, respectively, representing principally royalties and fees due to
the Company which, as a result of doubt about their collection, the Company had not yet recorded as revenues.
101
REVISION 4
TYPE Clean
JOB NUMBER 246088
SERIAL <12345678>
PAGE NO. 102

OPERATOR PM10

No payments were required to be made currently on any of these amounts. During fiscal 2012, the Company
recognized approximately $375,000 of previously unrecognized revenues related to KK Mexico which were
received on May 5, 2011 in connection with the Companys sale of its 30% equity interest in the franchisee, as
more fully described in Note 8. During fiscal 2012, the Company also reversed an allowance for doubtful notes
receivable of approximately $391,000 related to KK Mexico; such note also was paid in full on May 5, 2011.
Collections on these promissory notes are being recorded as revenue as they are received.
Note 11 Accrued Liabilities
The components of accrued liabilities are as follows:
February 3,
January 29,
2013
2012
(In thousands)
Accrued compensation
Accrued vacation pay
Current portion of self-insurance claims, principally workers compensation
(Notes 1, 6, 10, and 13)
Accrued guarantee liabilities (Notes 8, 14 and 17)
Accrued taxes, other than income
Customer deposits
Unexpended franchisee brand fund contributions
Accrued health care claims
Accrued professional fees
Current portion of lease termination costs (Notes 13 and 16)
Current portion of deferred franchise fee revenue
Agricultural commodity futures contracts
Other
$ 9,347
5,542
$ 8,876
5,196
4,156
2,575
2,107
1,950
1,493
966
641
464
260
15
2,814
$32,330
3,623
2,927
1,851
902
858
1,112
262
458
418
2,317
$28,800
The changes in the assets and liabilities associated with self-insurance programs are summarized as follows:
Accrual for self-insurance programs, net of receivables

from stop-loss policies:
Additions charged to costs and expenses
Claims payments
Accrual reflected in:
Accrued liabilities
Claims receivable under stop-loss insurance
policies included in:
Other assets
102
February 3,
2013
Year Ended
January 29,
2012
(In thousands)
January 30,
2011
$ 8,203
3,777
(3,525)
$ 8,455
$ 8,760
3,158
(3,715)
$ 8,203
$ 9,777
2,538
(3,555)
$ 8,760
$ 4,156
9,979
$ 3,623
8,096
$ 3,642
8,138
(1,194)
(4,486)
$ 8,455
(561)
(2,955)
$ 8,203
(477)
(2,543)
$ 8,760
REVISION 4
TYPE Clean
JOB NUMBER 246088
SERIAL <12345678>
PAGE NO. 103

OPERATOR PM10

Note 12 Long Term Debt and Lease Commitments
Long-term debt and capital lease obligations consist of the following:
February 3,
January 29,
2013
2012
(In thousands)
2011 Term Loan

Capital lease obligations
Less: current maturities
$24,303
1,440
25,743
(2,148)
$23,595
$26,305
1,288
27,593
(2,224)
$25,369
The following table presents maturities of long-term debt and capital lease obligations:
Fiscal Year
(In thousands)
2014
2015
2016
2017
2018
Thereafter
$ 2,148
1,974
20,570
1,051
$25,743
2011 Secured Credit Facilities

On January 28, 2011, the Company entered into secured credit facilities (the 2011 Secured Credit
Facilities), consisting of a $25 million revolving credit line (the 2011 Revolver) and a $35 million term loan
(the 2011 Term Loan), each of which mature in January 2016. The 2011 Secured Credit Facilities are secured
by a first lien on substantially all of the assets of the Company and its domestic subsidiaries. The Company used
the proceeds of the 2011 Term Loan to repay the approximate $35 million principal outstanding balance under the
Companys prior secured credit facilities (the 2007 Secured Credit Facilities) described below, which were then
terminated. The Company recorded a pretax charge of approximately $1.0 million in the fourth quarter of fiscal
2011 to write off a majority of the unamortized deferred debt issuance costs related to the terminated facility and
to record certain expenses related to the new facility.
Interest on borrowings under the 2011 Secured Credit Facilities is payable either at LIBOR or the Base Rate
(which is the greatest of the prime rate, the Fed funds rate plus 0.50%, or the one-month LIBOR rate plus 1.00%),
in each case plus the Applicable Percentage. The Applicable Percentage for LIBOR loans ranges from 2.25% to
3.00%, and for Base Rate loans ranges from 1.25% to 2.00%, in each case depending on the Companys leverage
ratio. As of February 3, 2013, all outstanding borrowings under the 2011 Secured Credit Facilities were based on
LIBOR, and the Applicable Margin was 2.25%.
principal amount of $17.5 million. The derivative contract entitles the Company to receive from the counterparty
cash flow hedge.
103

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 104

OPERATOR PM10

The 2011 Revolver contains provisions which permit the Company to obtain letters of credit, issuance of
which constitutes usage of the lending commitments and reduces the amount available for cash borrowings. At
closing, $12.5 million of letters of credit were issued under the 2011 Revolver to replace letters of credit issued
under the terminated facilities, all of which secure the Companys reimbursement obligations to insurers under the
Companys self-insurance programs. Such letters of credit totaled $10.2 million as of February 3, 2013. There were
no borrowings outstanding under the 2011 Revolver at February 3, 2013 or January 29, 2012.
The Company is required to pay a fee equal to the Applicable Percentage for LIBOR-based loans on the
outstanding amount of letters of credit, as well as a fronting fee of 0.125% of the amount of such letter of credit.
There also is a fee on the unused portion of the 2011 Revolver lending commitment, ranging from 0.35% to 0.65%,
depending on the Companys leverage ratio.
The 2011 Term Loan is payable in quarterly installments of approximately $467,000 (as adjusted to give
effect to principal prepayments), and a final installment equal to the remaining principal balance in January 2016.
The Term Loan is required to be prepaid with some or all of the net proceeds of certain equity issuances, debt
issuances, asset sales and casualty events. On the closing date, the Company deposited into escrow an aggregate
of $1.8 million with respect to nine properties for which the Company agreed to furnish to the lenders certain
documentation on or before January 31, 2012, with amounts to be released from escrow upon the Companys
furnishing such documentation. If the Company did not furnish the documentation by January 31, 2012, then the
amount remaining in escrow on that date would have been used to make a prepayment of principal on the 2011
Term Loan. During fiscal 2012, all documentation was furnished by the Company and the entire $1.8 million of
the escrowed amount was returned to the Company.
The 2011 Secured Credit Facilities require the Company to meet certain financial tests, including a
maximum leverage ratio and a minimum fixed charge coverage ratio. The leverage ratio was required to be not
greater than 2.5 to 1.0 in fiscal 2013 and thereafter. The fixed charge coverage ratio is required to be not less than
1.1 to 1.0 in fiscal 2013 and 1.2 to 1.0 thereafter.
As of February 3, 2013, the Companys leverage ratio was 0.7 to 1.0 and the fixed charge coverage ratio was
3.3 to 1.0.
On March 27, 2012, the Companys Board of Directors authorized the repurchase of up to $20 million of the
Companys common stock. The Companys lenders consented to such repurchases, subject to certain conditions,
the most significant of which was that for the Reference Period (defined below) immediately preceding any such
repurchases, the Leverage Ratio be not greater than 2.0 to 1.0 and the Fixed Charge Coverage Ratio be not less
than 1.5 to 1.0. The Company completed the share repurchase in June 2012 as described in Note 15.
The leverage ratio is calculated by dividing total debt as of the end of each fiscal quarter by Consolidated
EBITDA for the Reference Period (each consisting of the four most recent fiscal quarters). For this purpose,
debt includes not only indebtedness reflected in the consolidated balance sheet, but also, among other things,
the amount of undrawn letters of credit, the principal balance of indebtedness of third parties to the extent such
indebtedness is guaranteed by the Company, and any amounts reasonably expected to be paid with respect to any
other guaranty obligations. The fixed charge coverage ratio is calculated for each Reference Period by dividing
(a) the sum of (i) Consolidated EBITDA, plus (ii) Cash Lease Payments, minus (iii) cash income taxes, minus
(iv)distributions in respect of the Companys common stock (which are limited by the credit agreement), minus
(v)unfinanced capital expenditures, by (b) Consolidated Fixed Charges.
Consolidated EBITDA is a non-GAAP measure and is defined in the 2011 Secured Credit Facilities to
mean, for each Reference Period, generally, consolidated net income or loss, exclusive of unrealized gains and
losses on hedging instruments, gains or losses on asset dispositions, and provisions for payments on guarantee
obligations, plus the sum of interest expense, income taxes, depreciation, rent expense and lease termination
costs, and non-cash charges; and minus the sum of non-cash credits, interest income, Cash Lease Payments,
and payments on guaranty obligations in excess of $1 million during the Reference Period or $3 million in
theaggregate.
104
REVISION 4
TYPE Clean
JOB NUMBER 246088
SERIAL <12345678>
PAGE NO. 105

OPERATOR PM10

Cash Lease Payments means the sum of cash paid or required to be paid for obligations under operating
leases for real property and equipment (net of sublease income), lease payments on closed stores (but excluding
payments in settlement of future obligations under terminated operating leases), and cash payments in settlement
of future obligations under terminated operating leases to the extent the aggregate amount of such payments
exceeds $1.5 million during a Reference Period or $5.0 million in the aggregate.
Consolidated Fixed Charges means the sum of cash interest expense, Cash Lease Payments, and scheduled
principal payments of indebtedness.
The operation of the restrictive financial covenants described above may limit the amount the Company may
borrow under the 2011 Revolver. The restrictive covenants did not limit the Companys ability to borrow the full
$14.8 million of unused credit under the 2011 Revolver at February 3, 2013.
The 2011 Secured Credit Facilities also contain covenants which, among other things, generally limit (with
certain exceptions): liquidations, mergers, and consolidations; the incurrence of additional indebtedness (including
guarantees); the incurrence additional liens; the sale, assignment, lease, conveyance or transfer of assets; certain
investments (including investments in and advances to franchisees which own and operate Krispy Kreme stores);
dividends and stock redemptions or repurchases; transactions with affiliates; engaging in materially different lines
of business; sale-leaseback transactions; and other activities customarily restricted in such agreements. The 2011
Secured Credit Facilities also prohibit the transfer of cash or other assets to KKDI from its subsidiaries, whether
by dividend, loan or otherwise, but provide for exceptions to enable KKDI to pay taxes, directors fees and
operatingexpenses.
The 2011 Secured Credit Facilities also contain customary events of default including, without limitation,
payment defaults, breaches of representations and warranties, covenant defaults, cross-defaults to other
indebtedness in excess of $2.5 million, certain events of bankruptcy and insolvency, judgment defaults in excess of
$2.5 million and the occurrence of a change of control.
Borrowings and issuances of letters of credit under the 2011 Revolver are subject to the satisfaction of usual
and customary conditions, including the accuracy of representations and warranties and the absence of defaults.
2007 Secured Credit Facilities
In February 2007, the Company closed the 2007 Secured Credit Facilities totaling $160 million then
consisting of a $50 million revolving credit facility maturing in February 2013 (the 2007 Revolver) and a $110
million term loan maturing in February 2014 (the 2007 Term Loan). The 2007 Secured Credit Facilities were
secured by a first lien on substantially all of the assets of the Company and its subsidiaries.
The commitments under the 2007 Revolver were reduced from $50 million to $30 million in April 2008,
and further reduced to $25 million in connection with amendments to the facilities in April 2009 (the April
2009 Amendments). In connection with the April 2009 Amendments, the Company prepaid $20 million of the
principal balance outstanding under the 2007 Term Loan. The Company made other payments of 2007 Term Loan
principal after February 2007, consisting of $26.6 million representing the proceeds of asset sales, $25.0 million
representing discretionary prepayments and $3.4 million representing scheduled amortization which, together with
the $20 million prepayment in April 2009 reduced the principal balance of the 2007 Term Loan to approximately
$35 million as of January 27, 2011. On January 28, 2011, the 2007 Term Loan was repaid in full and the 2007
Secured Credit Facilities were terminated.
Interest on borrowings under the 2007 Revolver and 2007 Term Loan was payable either (a) at the greater of
LIBOR or 3.25% or (b) at the Alternate Base Rate (which was the greater of Fed funds rate plus 0.50% or the prime
rate), in each case plus the Applicable Margin. After giving effect to the April 2009 Amendments, the Applicable
Margin for LIBOR-based loans and for Alternate Base Rate-based loans was 7.50% and 6.50%, respectively
(5.50% and 4.50%, respectively, prior to the April 2009 Amendments and 3.50% and 2.50%, respectively, prior to
amendments executed in April 2008).
105
REVISION 4
TYPE Clean
JOB NUMBER 246088
SERIAL <12345678>
PAGE NO. 106

OPERATOR PM10

The Company was required to pay a fee equal to the Applicable Margin for LIBOR-based loans on the
outstanding amount of letters of credit issued under the 2007 Revolver, as well as a fronting fee of 0.25% of the
amount of such letter of credit payable to the letter of credit issuer. There also was a fee on the unused portion of
the 2007 Revolver lending commitment, which increased from 0.75% to 1.00% in connection with the April 2009
Amendments.
Lease Obligations
The Company leases equipment and facilities under both capital and operating leases. The approximate future
minimum lease payments under non-cancelable leases as of February 3, 2013 are set forth in the following table:
Operating
Capital
Leases
Leases
(In thousands)
Fiscal Year
2014
2015
2016
2017
2018
Thereafter
Less: portion representing interest
Less: portion representing executory costs
$ 11,267
10,931
8,723
6,792
6,532
74,782
$119,027
580
350
212
210
221
3,821
5,394
(3,836)
(118)
$ 1,440
Rent expense, net of rental income, totaled $12.8 million in fiscal 2013, $12.0 million in fiscal 2012 and $10.8
million in fiscal 2011. Such rent expense includes rents under non-cancelable operating leases as well as sundry
short-term rentals.
Cash Payments of Interest
Interest paid, inclusive of deferred financing costs, totaled $1.2 million in fiscal 2013, $1.8 million in fiscal
2012 and $8.1 million in fiscal 2011.
Note 13 Other Long-Term Obligations and Deferred Credits
The components of other long-term obligations and deferred credits are as follows:
February 3,
January 29,
2013
2012
(In thousands)
Non-current portion of self-insurance claims, principally workers

compensation (Notes 1, 6, 10 and 11)
Accrued rent expense
Non-current portion of deferred franchise fee revenue
Landlord upfit allowances on leased premises
Mirror 401(k) plan liability (Notes 10 and 19)
Non-current portion of lease termination costs (Notes 11 and 16)
Other
106
$ 9,979
5,655
3,771
2,225
1,816
182
1,607
$25,235
$ 8,096
5,070
2,456
314
1,039
251
1,709
$18,935
REVISION 4
TYPE Clean
JOB NUMBER 246088
SERIAL <12345678>
PAGE NO. 107

OPERATOR PM10

Note 14 Commitments and Contingencies
Except as disclosed below, the Company currently is not a party to any material legal proceedings.
Pending Litigation
K2 Asia Litigation
On April 7, 2009, a Cayman Islands corporation, K 2 Asia Ventures, and its owners filed a lawsuit in Forsyth
County, North Carolina Superior Court against the Company, its franchisee in the Philippines, and other persons
associated with the franchisee. The suit alleges that the Company and the other defendants conspired to deprive
the plaintiffs of claimed exclusive rights to negotiate franchise and development agreements with prospective
franchisees in the Philippines, and seeks unspecified damages. The Company believes that these allegations are
false and intends to vigorously defend against the lawsuit.
Colchester Security Litigation
On January 27, 2012, Colchester Security II, LLC, the Companys former landlord in Lorton, Virginia,
filed a suit against the Company in the Circuit Court of Fairfax County, Virginia alleging breach of the lease
and negligence resulting in property damage at a commissary facility previously operated by the Company. The
plaintiff seeks $2.7 million in damages. The Company denies the allegations and intends to pursue counterclaims
of approximately $3.0 million relating to indemnity claims and breach of the lease. No liability has been recorded
with respect to this matter because management does not believe it is probable that a loss has been incurred. In
March 2013, both parties agreed to avail themselves of the Fairfax County Courts alternate dispute resolution
program, and now the matter has been set for binding arbitration to occur in late June 2013.
Other Legal Matters
The Company also is engaged in various legal proceedings arising in the normal course of business. The
Company maintains insurance policies against certain kinds of such claims and suits, including insurance policies
for workers compensation and personal injury, all of which are subject to deductibles.
Other Commitments and Contingencies
The Company has guaranteed certain loans from third-party financial institutions on behalf of Equity
Method Franchisees, primarily to assist the franchisees in obtaining third-party financing. The loans are
collateralized by certain assets of the franchisee, generally the Krispy Kreme store and related equipment. The
Companys contingent liabilities related to these guarantees totaled approximately $2.1 million at February 3,
2013, and are summarized in Note 8. These guarantees require payment from the Company upon demand of the
guaranteed party upon certain defaults by the respective debtor and, if the debtor defaults, the Company may be
required to pay amounts outstanding under the related agreements in addition to the principal amount guaranteed,
including accrued interest and related fees.
The aggregate recorded liability for these loan guarantees totaled $1.6 million as of February 3, 2013 and $1.9
million as of January 29, 2012, and is included in accrued liabilities in the accompanying consolidated balance
sheet. These liabilities represent the estimated amount of guarantee payments which the Company believed to be
probable. While there is no current demand on the Company to perform under any of the guarantees, there can be
no assurance that the Company will not be required to perform and, if circumstances change from those prevailing
at February 3, 2013, additional guarantee payments or provisions for guarantee payments could be required with
respect to any of the guarantees.
107
REVISION 4
TYPE Clean
JOB NUMBER 246088
SERIAL <12345678>
PAGE NO. 108

OPERATOR PM10

One of the Companys lenders had issued letters of credit on behalf of the Company totaling $10.2 million at
February 3, 2013, all of which secure the Companys reimbursement obligations to insurers under the Companys
self-insurance arrangements.
The Company is exposed to the effects of commodity price fluctuations on the cost of ingredients of its
products, of which flour, shortening and sugar are the most significant. In order to secure adequate supplies of
product and bring greater stability to the cost of ingredients, the Company routinely enters into forward purchase
contracts with suppliers under which the Company commits to purchase agreed-upon quantities of ingredients
at agreed-upon prices at specified future dates. Typically, the aggregate outstanding purchase commitment at
any point in time will range from one months to several years anticipated ingredients purchases, depending
on the ingredient. In addition, from time to time the Company enters into contracts for the future delivery of
equipment purchased for resale and components of doughnut-making equipment manufactured by the Company.
As of February 3, 2013, the Company had approximately $81 million of commitments under ingredient and other
forward purchase contracts. While the Company has multiple suppliers for most of its ingredients, the termination
of the Companys relationships with vendors with whom the Company has forward purchase agreements, or those
vendors inability to honor the purchase commitments, could adversely affect the Companys results of operations
and cash flows.
In addition to entering into forward purchase contracts, the Company from time to time purchases exchangetraded commodity futures contracts or options on such contracts for raw materials which are ingredients of
the Companys products or which are components of such ingredients, including wheat and soybean oil. The
Company typically assigns the futures contract to a supplier in connection with entering into a forward purchase
contract for the related ingredient. The Company may also purchase futures, options on futures or enter into other
hedging contracts to hedge its exposure to rising gasoline prices. See Note 20 for additional information about
thesederivatives.
Note 15 Shareholders Equity
Share-Based Compensation for Employees and Directors
On June 12, 2012, the Companys shareholders approved the Krispy Kreme Doughnuts, Inc. 2012 Stock
Incentive Plan (the 2012 Plan). The 2012 Plan, which expires on June 11, 2022, replaced the Companys 2000
Stock Incentive Plan (the 2000 Plan), which expired on June 30, 2012. The 2012 Plan provides for the grant of
incentive stock options, non-qualified stock options, restricted stock awards, restricted stock units, stock awards,
performance unit awards, performance share awards, stock appreciation rights and phantom stock awards.
The 2012 Plan limits issuance of shares of Company common stock under the 2012 Plan to approximately
3,550,000 shares, of which 3.3 million remain available for grant through June 11, 2022. Any shares that are
subject to options or stock appreciation rights awarded under the 2012 Plan will be counted against the 2012 Plan
limit as one share for every one share granted, and any shares that are subject to 2012 Plan awards other than
options or stock appreciation rights will be counted against this limit as one and thirty three-hundredths (1.33)
shares for every one share granted. The 2012 Plan provides that options may be granted with exercise prices not
less than the closing sale price of the Companys common stock on the date of grant.
The Company measures and recognizes compensation expense for share-based payment (SBP) awards
based on their fair values. The fair value of SBP awards for which employees and directors render the requisite
service necessary for the award to vest is recognized over the related vesting period. The fair value of SBP awards
which vest in increments and for which vesting is subject solely to service conditions is charged to expense on a
straight-line basis over the aggregate vesting period of each award, which generally is four years. The fair value
108

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 109

OPERATOR PM10

of SBP awards which vest in increments and for which vesting is subject to both market conditions and service
conditions is charged to expense over the estimated vesting period of each increment of the award, each of which
is treated as a separate award for accounting purposes.
The aggregate cost of SBP awards charged to earnings for fiscal 2013, 2012 and 2011 is set forth in the
following table. The Company did not realize any excess tax benefits from the exercise of stock options or the
vesting of restricted stock or restricted stock units during any of the periods.
Year Ended
February 3,
2013
January 29,
2012
January 30,
2011
(In thousands)
Costs charged to earnings related to:

Stock options
Restricted stock and restricted stock units
Total costs
$1,537
5,264
$6,801
$3,480
3,219
$6,699
$1,722
3,425
$5,147
Costs included in:

Direct operating expenses
Total costs
$2,614
4,187
$6,801
$2,829
3,870
$6,699
$2,079
3,068
$5,147
The fair value of stock options subject only to service conditions was estimated using the Black-Scholes
option pricing model. In addition to service conditions, certain stock options granted in fiscal 2008 also provide
that the price of the Companys common stock must increase by 20% after the grant date, and remain at or above
the appreciated price for at least ten consecutive trading days, in order for the options to become vested and
exercisable. The fair value of those stock options was estimated using Monte Carlo simulation techniques. Options
granted generally have contractual terms of 10 years, the maximum term permitted under the 2012 and 2000
Plans. There were no stock options granted in fiscal 2013. The weighted average assumptions used in valuing stock
options in fiscal 2012 and 2011 are set forth in the following table:
Year Ended
January 29,
January 30,
2012
2011
Expected life of option

Risk-free interest rate
Expected volatility of stock
Expected dividend yield
7.0 years
1.41%
70.0%
7.0 years
2.66%
50.0%
The expected life of stock options valued using the Black-Scholes option pricing model is estimated by
reference to historical experience and any relevant characteristics of the option. The expected life of stock options
valued using Monte Carlo simulation techniques is based upon the vesting dates forecasted by the simulation and
then assuming that options which vest are exercised at the midpoint between the forecasted vesting date and their
expiration. The risk-free rate of interest is based on the yield of a zero-coupon U.S. Treasury bond on the date the
109

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 110
OPERATOR PM10

award is granted having a maturity approximately equal to the expected term of the award. Expected volatility
is estimated based upon the historical volatility of the Companys common shares. The Company uses historical
employee turnover data to estimate forfeitures of awards prior to vesting.
There were no stock options granted during fiscal 2013. The number of options granted during fiscal 2012
and 2011 and the aggregate and weighed average fair value of such options were as follows:
Year Ended
January 29,
January 30,
2012
2011
Weighted average fair value per share of options granted

Total number of options granted
Total fair value of all options granted
4.64
1,040,000
$4,824,200
3.44
905,000
$ 3,115,000
The following table summarizes stock option transactions for fiscal 2013, 2012 and 2011.
Weighted
Average
Weighted
Shares
Exercise
Average
Subject
Price
Aggregate
Remaining
to
Per
Intrinsic
Contractual
Option
Share
Value
Term
(Dollars in thousands, except per share amounts)
Outstanding at January 31, 2010

Granted
Exercised
Expired
Forfeited
Granted
Exercised
Expired
Forfeited
Granted
Exercised
Expired
Forfeited
Outstanding at February 3, 2013
Exercisable at February 3, 2013
110
6,148,900
905,000
(214,500)
(905,700)
5,933,700
1,040,000
(396,900)
(504,000)
(263,400)
5,809,400
(128,000)
(304,900)
(170,000)
5,206,500
3,699,000
$12.94
$ 6.39
$
$13.44
$27.04
$ 9.77
$ 7.00
$ 2.61
$17.60
$ 3.91
$ 9.35
$
$ 1.93
$34.40
$ 6.84
$ 8.15
$ 8.66
$ 1,383
$
5.9 years
$12,507
6.5 years
$ 2,721
$14,572
$
6.6 years
947
$36,388
$27,239
5.8 years
5.1 years

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 111

OPERATOR PM10

Additional information regarding stock options outstanding as of February 3, 2013 is as follows:
Range of
Exercise Prices
Shares
$ 1.40 - $ 3.41
$ 6.39 - $ 9.71
$12.52 - $15.36
$28.11 - $28.11
$30.98 - $44.22
2,353,600
2,035,000
393,400
112,700
311,800
Options Outstanding
Weighted
Average
Remaining
Contractual
Weighted
Life
Average
(Years)
Exercise Price
5.9
7.7
2.0
0.6
$ 2.49
$ 7.25
$13.86
$28.11
$42.38
Options Exercisable
Shares
Weighted
Average
Exercise
Price
2,161,100
800,000
313,400
112,700
311,800
$ 2.47
$ 7.31
$14.20
$28.11
$42.38
In addition to stock options, the Company periodically has awarded restricted stock and restricted stock units
(which are settled in common stock). The following table summarizes changes in unvested restricted stock and
restricted stock unit awards for fiscal 2013, 2012 and 2011:
Unvested at January 31, 2010

Granted
Vested
Forfeited
Granted
Vested
Forfeited
Granted
Vested
Forfeited
Unvested at February 3, 2013
Unvested
Shares
Weighted
Average
Grant Date
Fair Value
1,386,200
420,000
(786,500)
(15,200)
1,004,500
668,400
(549,300)
(67,100)
1,056,500
757,700
(497,300)
(78,700)
1,238,200
$ 4.13
$ 4.29
$ 4.17
$ 4.16
$ 4.16
$ 7.65
$ 4.95
$ 4.42
$ 5.95
$10.28
$ 5.76
$ 6.49
$ 8.65
The total fair value as of the grant date of the restricted stock and restricted stock unit awards vesting during
fiscal 2013, 2012 and 2011 was $2.9 million, $2.7 million and $3.3 million, respectively.
As of February 3, 2013, the total unrecognized compensation cost related to SBP awards was approximately
$8.2 million. The remaining service periods over which compensation cost will be recognized for these awards
range from approximately three months to four years, with a weighted average remaining service period of
approximately 1.5 years.
At February 3, 2013, there were approximately 9.7 million shares of common stock reserved for issuance
pursuant to awards granted under the 2012 and 2000 Plans.
111
REVISION 4
TYPE Clean
JOB NUMBER 246088
SERIAL <12345678>
PAGE NO. 112

OPERATOR PM10

Common Shares and Warrants Issued in Connection With Settlement of Litigation
In fiscal 2008, the Company issued warrants to acquire 4.3 million shares of common stock at a price of
$12.21 per share in connection with the settlement of certain litigation. The warrants expired unexercised on
March 2, 2012.
Warrant Issued in Exchange for Services
In fiscal 2006, the Company issued a warrant to purchase 1.2 million shares of the Companys common
stock at a price of $7.75 per share as part of the consideration paid to a corporate recovery and advisory firm. The
warrant expired unexercised on January 31, 2013.
Tax Asset Protection Plan
On January 14, 2013, the Companys Board of Directors adopted a tax asset protection plan (the Plan)
intended to preserve the Companys federal net operating loss and other tax carryforwards, which represent a
substantial asset to the Company and itsshareholders.
As of February 3, 2013, the Company had approximately $206million of federal net operating losses that
can be carried forward to future years to offset taxable income the Company earns in the future, thereby reducing
the amount of taxes payable by the Company in subsequent years. These carryforwards are more fully described
in Note 3. These net operating loss carryforwards expected to be realized in future had a carrying value of
approximately $81million as of February 3,2013.
Under the Internal Revenue Code (the Code), the Companys ability to make use of these carryforwards
would be limited in the event of a significant change in ownership of the Companys common shares by
shareholders owning 5% or more of the Companys shares. Specifically, a cumulative change of more than 50%
of the Companys shares during any three year period by shareholders owning 5% or more of the Companys
stock would trigger a limitation. Certain Company actions, including share repurchases, would also add to the
cumulative ownershipchange.
Because a limitation in the Companys ability to utilize its tax carryforwards could increase the amount of
the Companys future tax payments or accelerate the timing of such payments, a limitation could have a material
adverse effect on the Companys cash flows and financial position. For this reason, the Company adopted the
Plan to discourage persons from acquiring more than 4.99% of the Companys common shares, which should
have the effect of substantially reducing the likelihood of an ownership change and any resulting limitation on the
Companys ability to utilize itscarryforwards.
Under the Plan, subject to certain exceptions, the acquisition by any person or group of 4.99% or more of
the Companys outstanding shares of common stock makes that person or group an acquiring person and could
result in significant dilution in the ownership and economic interest of such acquiring person. This potential
dilution acts as a strong deterrent against stock acquisitions that may result in an ownership change that could give
rise to a limitation on the Companys ability to utilize thecarryforwards.
To effect the Plan, the Company declared a dividend of one preferred share purchase right (a Right) for
each outstanding share of its common stock payable to registered shareholders of record as of January 24, 2013,
as well as to holders of the Companys common stock issued after that date. The Rights trade with, and be
represented by, the Companys commonstock.
112

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 113

OPERATOR PM10

Under the Plan, the Board is granted the discretion to exempt persons from the 4.99% threshold if it were
to determine that such ownership is in the best interests of shareholders and not inconsistent with the purpose
of the Plan. Shareholders of the Company as of January 14, 2103 holding 4.99% or more of the Companys
outstanding shares of common stock are exempt from the provisions of the Plan unless they thereafter make
additional purchases. The Plan will expire upon redemption or exchange of the Rights or if the net operating loss
carryforwards are utilized in all material respects or are no longer available in any material respect. Otherwise, the
Plan will expire no later than the close of business on January 14, 2019, unless extended by theBoard.
The Plan should not interfere with any merger or other business combination that is in the best interests of
the Company and its shareholders because the Rights may be redeemed by the Company at $0.01 per Right in cash
prior to the time the Rights becomeexercisable.
Repurchases of Common Shares
Pursuant to the authorization of its Board of Directors, from March 27, 2012 through June 28, 2012, the
Companys repurchased $20million of its common stock. The average price per share was $6.42.
During each of the last three fiscal years, the Company permitted holders of restricted stock awards to satisfy
their obligations to reimburse the Company for the minimum required statutory withholding taxes arising from the
vesting of such awards by surrendering vested common shares in lieu of reimbursing the Company in cash. The
aggregate fair value of common shares surrendered related to the vesting of restricted stock awards was $758,000,
$1.0million and $581,000 in fiscal 2013, 2012 and 2011, respectively. The aggregate fair value of the surrendered
shares has been reflected as a financing activity in the accompanying consolidated statement of cash flows and as
a repurchase of common shares in the accompanying consolidated statement of changes in shareholdersequity.
The following table summarizes repurchases of common stock for fiscal 2013, 2012 and2011:
February 3,
2013
Common
Shares
Stock
Shares repurchased under share

repurchase authorization . . . . . . . . . . . . . . . . . .
Shares surrendered in reimbursement
for withholding taxes . . . . . . . . . . . . . . . . . . . .
Year Ended
January 29,
2012
Common
Shares
Stock
(Inthousands)
3,113
$20,000
100
3,213
758
$20,758
128
128
113
January 30,
2011
Common
Shares
Stock
1,004
$1,004
73
73
581
$581

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 114

OPERATOR PM10

Note 16 Impairment Charges and Lease Termination Costs
The components of impairment charges and lease termination costs are asfollows:
February 3,
2013
Impairmentcharges:
Impairment of long-lived assets - current period charges . . . . . . . . . . .
Impairment of long-lived assets - adjustments to previously
recorded estimates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Impairment of reacquired franchise rights . . . . . . . . . . . . . . . . . . . . . .
Total impairment charges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Lease terminationcosts:
Provision for termination costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less reversal of previously recorded accrued rent expense . . . . . . .
Net provision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total impairment charges and lease termination costs . . . . . . . .
Year Ended
January 29,
January 30,
2012
2011
(Inthousands)
$ 60
$3,437
60
(173)
40
3,304
306
306
$ 306
733
733
$793
1,449
(687)
762
$4,066
The Company tests long-lived assets for impairment when events or changes in circumstances indicate that
their carrying value may not be recoverable. These events and changes in circumstances include store closing and
refranchising decisions, the effects of changing costs on current results of operations, observed trends in operating
results, and evidence of changed circumstances observed as a part of periodic reforecasts of future operating
results and as part of the Companys annual budgeting process. When the Company concludes that the carrying
value of long-lived assets is not recoverable (based on future projected undiscounted cash flows), the Company
records impairment charges to reduce the carrying value of those assets to their estimated fair values. Impairment
charges related to Company Stores long-lived assets were approximately $60,000 and $3.4million in fiscal 2012
and 2011, respectively. Such charges relate to underperforming stores, including both stores closed or likely to
be closed and stores which management believes will not generate sufficient future cash flows to enable the
Company to recover the carrying value of the stores assets, but which management has not yet decided to close.
The impaired store assets include real properties, the fair values of which were estimated based on independent
appraisals or, in the case of any properties which the Company is negotiating to sell, based on the Companys
negotiations with unrelated third-party buyers; leasehold improvements, which are typically abandoned when the
leased properties revert to the lessor; and doughnut-making and otherequipment.
The Company records impairment charges for reacquired franchise rights when such intangible assets are
determined to be impaired as a result of store closing decisions or otherdevelopments.
contracts are terminated or, if earlier, the date on which the Company ceases use of the leased property. The
fair value of these liabilities were estimated as the excess, if any, of the contractual payments required under the
unexpired leases over the current market lease rates for the properties, discounted at a credit-adjusted risk-free
rate over the remaining term of the leases. The provision for lease termination costs also includes adjustments
to liabilities recorded in prior periods arising from changes in estimated sublease rentals and from settlements
withlandlords.
114

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 115

OPERATOR PM10

The transactions reflected in the accrual for lease termination costs are summarized asfollows:
February 3,
2013

Provision for lease termination costs:
Provisions associated with store closings, net of estimated
sublease rentals
Adjustments to previously recorded provisions resulting
from settlements with lessors and adjustments of
previous estimates
Accretion of discount
Total provision
Payments on unexpired leases, including settlements with lessors
Accrued lease termination costs are included in the consolidated
balance sheet as follows:
Accrued liabilities
Other long-term obligations
Year Ended
January 29,
2012
(In thousands)
January 30,
2011
$ 709
$ 1,995
$ 1,679
422
276
30
306
(369)
$ 646
656
77
733
(2,019)
$ 709
832
195
1,449
(1,133)
$ 1,995
$ 464
182
$ 646
458
251
709
648
1,347
$ 1,995
Note 17 Related Party Transactions

All franchisees are required to purchase doughnut mix and production equipment from the Company.
Revenues include $8.9million, $9.5million and $8.5million in fiscal 2013, 2012 and 2011, respectively, of sales
to stores owned by franchisees in which the Company had an ownership interest. Revenues also include royalties
from these franchisees of $1.3million, $1.8million and $1.9million in fiscal 2013, 2012 and 2011, respectively.
Trade receivables from these franchisees are included in receivables from related parties as described in Note 4.
These transactions were conducted pursuant to development and franchise agreements, the terms of which are
substantially the same as the agreements with unaffiliatedfranchisees.
The Companys franchisee for the Middle East is an affiliate of an entity which, until December 20, 2012,
was the beneficial owner of approximately 13% of the Companys common stock. The Company had transactions
in the normal course of business with this franchisee (including sales of doughnut mix and equipment to the
franchisee and royalties payable to the Company by the franchisee based on its sales at Krispy Kreme franchise
stores) totaling approximately $6.7million in fiscal 2013, $7.8million in fiscal 2012 and $9.2million in fiscal
2011. Such transactions were conducted pursuant to development and franchise agreements, the terms of which are
substantially the same as the agreements with other internationalfranchisees.
In fiscal 2010, the Company entered into a contract to refurbish the interior and exterior of two Company
stores with Cummings Incorporated (Cummings), a store exterior design and remodeling company of which an
independent director of the Company was a 60% indirect owner. The Company paid Cummings approximately
$380,000 in fiscal 2011 to complete the refurbishment of the two stores. While the unique nature of the
refurbishing services provided by Cummings was not directly comparable to those provided by competitors,
management believes the terms of the contract were no less favorable than could have been obtained from a
non-affiliated entity for conventional remodelingservices.
115

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 116

OPERATOR PM10

Note 18 Employee Benefit Plans
The Company has a 401(k) savings plan (the 401(k) Plan) to which eligible employees may contribute up
to 100% of their salary and bonus on a tax deferred basis, subject to statutory limitations. The Company currently
matches 50% of the first 6% of compensation contributed by each employee to the 401(k) Plan. Contributions
expense for this plan totaled approximately $820,000 in fiscal 2013, $820,000 in fiscal 2012 and $780,000 in
fiscal2011.
The Company also has a Nonqualified Deferred Compensation Plan (the 401(k) Mirror Plan) designed to
enable officers of the Company whose contributions to the 401(k) Plan are limited by certain statutory limitations
to have the same opportunity to defer compensation as is available to other employees of the Company under the
qualified 401(k) savings plan. Participants may defer from 1% to 15% of their base salary and from 1% to 100%
of their bonus (reduced by their contributions to the 401(k) Plan), subject to statutory limitations, into the 401(k)
Mirror Plan and may direct the investment of the amounts they have deferred. The investments, however, are not
a legally separate fund of assets, are subject to the claims of the Companys general creditors, and are included in
other assets in the consolidated balance sheet. The corresponding liability to participants is included in other longterm obligations. The balance in the asset and corresponding liability account was $1.8million and $1.0million at
February 3, 2013 and January 29, 2012,respectively.
Note 19 Fair Value Measurements
The accounting standards for fair value measurements define fair value as the price that would be received
for an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an
orderly transaction between market participants at the measurementdate.
The accounting standards for fair value measurements establish a three-level fair value hierarchy that
prioritizes the inputs used to measure fair value. This hierarchy requires entities to maximize the use of observable
inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are
asfollows:
Level 1 - Quoted prices in active markets that are accessible at the measurement date for identical assets
orliabilities.
Level 2 - Observable inputs other than quoted prices included within Level 1, such as quoted prices for
similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities
in markets that are not active; or other inputs that are observable or can be corroborated by observable
marketdata.
Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to
the fair value measurement of the assets or liabilities. These include certain pricing models, discounted
cash flow methodologies and similar techniques that use significant unobservableinputs.
Assets and Liabilities Measured at Fair Value on a Recurring Basis
The following table presents the Companys assets and liabilities that are measured at fair value on a
recurring basis at February 3, 2013 and January 29,2012.
116

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 117
OPERATOR PM10

February 3, 2013
Level 1
Level 2
Level 3
(In thousands)
Assets:
401(k) mirror plan assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest rate derivative . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Liabilities:
Agricultural commodity futures contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$1,816
$1,816
$
16
$ 16
15
Level 1
Assets:
401(k) mirror plan assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Agricultural commodity futures contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest rate derivative . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
January 29, 2012

Level 2
Level 3
(In thousands)
$1,039
21
$1,060
53
$ 53
Assets and Liabilities Measured at Fair Value on a Non-Recurring Basis

The following tables present the nonrecurring fair value measurements recorded during the year ended
February 3, 2013, January 29, 2012 and January 30,2011.
Year Ended February 3, 2013
Total gain
Level 1
Level 2
Level 3
(loss)
(In thousands)
Long-lived assets
Lease termination liabilities
Year Ended January 29, 2012

Total gain
Level 1
Level 2
Level 3
(loss)
(In thousands)
Long-lived assets
$1,130
(60)
Year Ended January 30, 2011

Total gain
Level 1
Level 2
Level 3
(loss)
(In thousands)
Long-lived assets
$4,123
422
There were no nonrecurring fair value measurements recorded during fiscal2013.
117
$ (3,437)
265
REVISION 4
TYPE Clean
JOB NUMBER 246088
SERIAL <12345678>
PAGE NO. 118

OPERATOR PM10

Long-Lived Assets
During the year ended January 29, 2012, long-lived assets with an aggregate carrying value of $1.2million
were written down to their estimated fair values of $1.1million, resulting in recorded impairment charges of
$60,000 as described in Note 16. During the year ended January 30, 2011, long-lived assets with an aggregate
carrying value of $7.5million were written down to their estimated fair values of $4.1million, resulting in
recorded impairment charges of $3.4million. During fiscal 2012 and 2011, the Company recorded impairment
charges related to long-lived assets, substantially all of which were real properties; the fair values of these assets
were estimated based on the present value of estimated future cash flows, on independent appraisals and, in
the case of any properties which the Company is negotiating to sell, based on the Companys negotiations with
unrelated third-party buyers. The charges relate to stores closed, refranchised or expected to be closed, as well as
charges with respect to stores management believes will not generate sufficient future cash flows to enable the
Company to recover the carrying value of the stores assets, but which management has not yet decided to close.
These inputs are classified as Level 2 within the valuationhierarchy.
Lease Termination Liabilities
During the fiscal year ended January 30, 2011, the Company recorded provisions for lease termination costs
related to closed stores based upon the estimated fair values of the liabilities under unexpired leases as described
in Note 16; such provisions were reduced by previously recorded accrued rent expense related to those stores. The
fair value of these liabilities was computed as the excess, if any, of the contractual payments required under the
unexpired leases over the current market lease rates for the properties, discounted at a credit-adjusted risk-free rate
over the remaining term of the leases. These inputs are classified as Level 2 within the valuation hierarchy. For the
year ended January 30, 2011, $687,000 of previously recorded accrued rent expense related to two store closures
and a store relocation exceeded the $422,000 fair value of lease termination liabilities related to such stores, and
such excess has been reflected as a credit to lease termination costs during theperiod.
Fair Values of Financial Instruments at the Balance Sheet Dates
The carrying values and approximate fair values of certain financial instruments as of February 3, 2013 and
January 29, 2012 were asfollows:
February 3, 2013
January 29, 2012
Carrying
Fair
Carrying
Fair
Value
Value
Value
Value
(In thousands)
Assets:
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Receivables from Equity Method Franchisees . . . . . . . . . . . . . . .
Agriculture commodity futures contracts . . . . . . . . . . . . . . . . . . .
Interest rate derivative . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$66,332
25,627
705
16
$ 66,332
25,627
705
16
$ 44,319
25,467
655
21
53
$ 44,319
25,467
655
21
53
Liabilities:
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Agriculture commodity futures contracts . . . . . . . . . . . . . . . . . . .
Long-term debt (including currentmaturities) . . . . . . . . . . . . . . .
12,198
15
25,743
12,198
15
25,743
10,494
27,593
10,494
27,593
The fair value of the term loan is estimated based on an indicative bid price, valuation input Level 2,
underGAAP.
118

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 119

OPERATOR PM10

Note 20 Derivative Instruments
The Company is exposed to certain risks relating to its ongoing business operations. The primary risks
managed by using derivative instruments are commodity price risk and interest rate risk. The Company does not
hold or issue derivative instruments for tradingpurposes.
The Company is exposed to credit-related losses in the event of non-performance by the counterparties
to its derivative instruments. The Company mitigates this risk of nonperformance by dealing with highly
ratedcounterparties.
Additional disclosure about the fair value of derivative instruments is included in Note19.
Commodity Price Risk
The Company is exposed to the effects of commodity price fluctuations in the cost of ingredients of its
products, of which flour, sugar and shortening are the most significant. In order to bring greater stability to the
cost of ingredients, from time to time the Company purchases exchange-traded commodity futures contracts, and
options on such contracts, for raw materials which are ingredients of its products or which are components of such
ingredients, including wheat and soybean oil. The Company is also exposed to the effects of commodity price
fluctuations in the cost of gasoline used by its delivery vehicles. To mitigate the risk of fluctuations in the price of
its gasoline purchases, the Company may purchase exchange-traded commodity futures contracts and options on
such contracts. The difference between the cost, if any, and the fair value of commodity derivatives is reflected in
earnings because the Company has not designated any of these instruments as hedges. Gains and losses on these
contracts are intended to offset losses and gains on the hedged transactions in an effort to reduce the earnings
volatility resulting from fluctuating commodity prices. The settlement of commodity derivative contracts is
reported in the consolidated statement of cash flows as a cash flow from operating activities. At February 3, 2013,
the Company had commodity derivatives with an aggregate contract volume of 145,000 bushels of wheat. Other
than the requirement to meet minimum margin requirements with respect to the commodity derivatives, there are
no collateral requirements related to suchcontracts.
Interest Rate Risk
All of the borrowings under the Companys secured credit facilities bear interest at variable rates based
upon either the lenders prime rate, the Fed funds rate or LIBOR. The interest cost of the Companys debt may
be affected by changes in these short-term interest rates and increases in those rates may adversely affect the
Companys results ofoperations.
principal amount of $17.5million. The derivative contract entitles the Company to receive from the counterparty
cash flowhedge.
In May 2007, the Company entered into interest rate derivative contracts having an aggregate notional
principal amount of $60million. The derivative contracts entitled the Company to receive from the counterparties
the excess, if any, of three-month LIBOR over 5.40%, and required the Company to pay to the counterparties the
excess, if any, of 4.48% over three-month LIBOR, in each case multiplied by the notional amount of the contracts.
The contracts expired in April 2010. Settlements under these derivative contracts were reported as cash flow from
operating activities in the consolidated statement of cashflows.
119

JOB NUMBER 246088
REVISION 4
SERIAL <12345678>
TYPE Clean
PAGE NO. 120

OPERATOR PM10

These derivatives entered into in May 2007 were accounted for as cash flow hedges from their inception
through April 8, 2008. Hedge accounting was discontinued on that date because the derivative contracts could
no longer be shown to be effective in hedging interest rate risk as a result of amendments to the Companys 2007
Secured Credit Facilities, which provided that interest on LIBOR-based borrowings is payable based upon the
greater of the LIBOR rate for the selected interest period or 3.25%. As a consequence of the discontinuance of
hedge accounting, changes in the fair value of the derivative contracts subsequent to April 8, 2008 were reflected
in earnings as they occurred. Amounts included in accumulated other comprehensive income related to changes in
the fair value of the derivative contracts for periods prior to April 9, 2008 were charged to earnings in the periods
in which the hedged forecasted transaction (interest on $60million of the principal balance of the 2007 Term
Loan) affected earnings, or earlier upon a determination that some or all of the forecasted transaction would not
occur. Such charges totaled approximately $152,000 in fiscal2011.
Quantitative Summary of Derivative Positions and Their Effect on Results of Operations
The following table presents the fair values of derivative instruments included in the consolidated balance
sheet as of February 3, 2013 and January 29,2012:
Derivatives Not Designated as

Hedging Instruments
Balance Sheet Location
Agricultural commodity futures contracts . . . . . . . . . . . . . . . . .
Derivatives Not Designated as

Hedging Instruments
Agricultural commodity futures contracts . . . . . . . . . . . . . . . . .
Accrued liabilities
Derivatives Designated as a Cash Flow Hedge
Interest rate derivative . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other assets
Asset Derivatives
Fair Value
February 3,
January 29,
2013
2012
(In thousands)
$21
Liability Derivatives
Fair Value
February 3,
January 29,
2013
2012
(In thousands)
$15
Asset Derivatives
Fair Value
February 3,
January 29,
2013
2012
(In thousands)
$16
$53
The effect of derivative instruments on the consolidated statement of operations for the year ended
February3, 2013, January 29, 2012 and January 30, 2011, was as follows:
Derivatives Not Designated as Hedging Instruments
Amount of Derivative
Gain or (Loss)
Recognized in Income
Year Ended
Location of Derivative Gain or (Loss) February 3, January 29, January 30,
2013
2012
2011
(In thousands)
Agricultural commodity futures contracts Direct operating expenses

Gasoline commodity futures contracts Direct operating expenses
Total
120
$837
$837
$(451)
(31)
$(482)
$544
185
$729

JOB NUMBER 246088
REVISION 4
SERIAL <12345678>
TYPE Clean
PAGE NO. 121

OPERATOR PM10

Amortization of Derivative Asset

Year Ended
Location of Amortization of Derivative February 3, January 29, January 30,
Asset Recognized in Income
2013
2012
2011
(In thousands)
Interest rate derivative Interest expense
$(34)
The effect of derivative instruments on other comprehensive income for the year end February 3, 2013,
January 29, 2012 and January 30, 2011, was as follows:
Location of Derivative Gain or (Loss)

Recognized in OCI
Interest rate derivative Change in fair value of derivative

Less-income tax effect
Net change in amount recognized
in OCI
Amount of Derivative
Gain or (Loss)
Recognized in OCI
Year Ended
February 3, January 29, January 30,
2013
2012
2011
(In thousands)
$(3)
1
$(549)
213
$(2)
$(336)
Note 21 Acquisitions and Divestitures

Business Combination
On August 30, 2012, the Company acquired the assets and operations of one of its franchisees in exchange
for $915,000 cash. The acquired assets consisted principally of two Krispy Kreme stores. The allocation of the
purchase price was as follows: $464,000 to property and equipment, $8,000 to other assets, and the balance of
$443,000 to reacquired franchise rights. The results of operations of the acquired business have been included with
those of the Company from the acquisition date.
Asset Divestiture
On September 27, 2012, the Company sold to one of its franchisees the leasehold interests and certain other
assets, including rights under franchise agreements, for three Krispy Kreme stores operated by the franchisee. The
Company acquired the leasehold interests and other assets related to the three stores from the franchisee in August
2006 for $2.9 million cash. After the Companys acquisition of the assets, the franchisee continued to operate
the stores for its own account pursuant to an operating agreement between the Company and the franchisee.
The aggregate purchase price of the three stores and the related assets in the September 2012 transaction was
approximately $3.6 million, of which approximately $360,000 was paid in cash at closing. The balance of the
121

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 122

OPERATOR PM10

purchase price was evidenced by a promissory note in the approximate amount of $3.2 million, payable in
monthly installments of approximately $51,000, including interest at 8%, beginning in November 2012, and a final
installment of the remaining principal balance on October 1, 2017. The carrying value of the divested assets was
approximately $1.9 million. Because the initial investment made by the franchisee to acquire the assets was less
than the minimum amount necessary to recognize a gain on the sale, the Company deferred recognition of the
$1.7 million gain, and such deferred gain is reflected as a reduction in the carrying value of the note receivable.
The Company is reporting the principal and interest payments received from the franchisee as a reduction of the
carrying value of the note. At such time as the franchisees investment exceeds 20% of the purchase price, the
Company will reconsider whether recognition of a gain on the transaction is then appropriate.
Note 22 Selected Quarterly Financial Data (Unaudited)
The tables below present selected quarterly financial data for fiscal 2013 and 2012.
April 29,
2012
Revenues
Operating expenses:
and amortization expense shown below)
Operating income
Interest income
Interest expense
Equity in losses of equity method franchisees
Other non-operating income and (expense), net
Income before income taxes
Provision for income taxes
Net income
Basic
Diluted
122
Quarter Ended
July 29,
October 28,
February 3,
2012
2012
2013
(In thousands, except per share data)
$108,496
$102,115
$107,087
$118,145
88,691
6,458
2,482
31
10,834
27
(398)
(50)
78
10,491
4,465
$ 6,026
85,657
4,770
2,399
55
9,234
61
(420)
(53)
79
8,901
3,972
$ 4,929
90,220
5,083
2,357
216
9,211
14
(384)
(47)
80
8,874
3,830
$ 5,044
98,260
8,778
2,653
4
8,450
12
(440)
(52)
80
8,050
3,270
$ 4,780
$
$
$
$
$
$
$
$
0.09
0.08
0.07
0.07
0.08
0.07
0.07
0.07

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 123

OPERATOR PM10

The sum of the quarterly earnings per share amounts does not necessarily equal earnings per share for the
year to date.
Quarter Ended
July 29,
October 28,
2012
2012
(In thousands)
April 29,
2012

Company Stores
Domestic Franchise
KK Supply Chain:
Total revenues
Less - intersegment sales elimination
External KK Supply Chain revenues
Total revenues
Company Stores
Domestic Franchise
KK Supply Chain
Total segment operating income
(including depreciation and amortization expense)
Consolidated operating income
123
February 3,
2013
$ 73,341
2,633
6,027
$ 69,338
2,430
5,781
$ 72,493
2,498
6,024
$ 81,322
2,764
7,109
53,785
(27,290)
26,495
$108,496
51,465
(26,899)
24,566
$102,115
52,825
(26,753)
26,072
$107,087
57,337
(30,387)
26,950
$118,145
2,948
1,569
4,494
8,477
17,488
(6,623)
(31)
$ 10,834
338
1,329
4,162
8,392
14,221
(4,932)
(55)
$ 9,234
1,985
1,174
4,301
7,312
14,772
(5,345)
(216)
$ 9,211
3,263
1,518
4,430
8,269
17,480
(9,026)
(4)
$ 8,450

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 124

OPERATOR PM10

May 1,
2011
Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating expenses:
and amortization expense shown below) . . . . . . . . . . .
General and administrative expenses . . . . . . . . . . . . . . . .
Depreciation and amortization expense . . . . . . . . . . . . . .
Impairment charges and lease termination costs . . . . . . . .
Operating income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Equity in income (losses) of equity method franchisees . . . .
Gain on sale of interest in equity method franchisee . . . . . . .
Other non-operating income and (expense), net . . . . . . . . . .
Income before income taxes . . . . . . . . . . . . . . . . . . . . . . . . . .
Provision for income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Basic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Diluted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
124
Quarter Ended
July 31,
October 30,
January 29,
2011
2011
2012 (1)
(In thousands, except per share data)
$104,600
$97,952
$98,708
$ 101,957
86,983
5,644
1,938
244
9,791
45
(477)
(9)
86
9,436
265
$ 9,171
85,697
4,930
2,087
301
4,937
56
(414)
12
6,198
86
10,875
2,036
$ 8,839
85,874
4,941
2,208
135
5,550
30
(385)
(72)
89
5,212
495
$ 4,717
87,880
6,673
2,002
113
5,289
35
(390)
(53)
(46)
4,835
(138,707)
$ 143,542
$
$
$
$
$ 0.07
$ 0.07
$
$
0.13
0.13
0.13
0.12
2.06
2.01

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 125

OPERATOR PM10

The sum of the quarterly earnings per share amounts does not necessarily equal earnings per share for the
year to date.
May 1,
2011

Company Stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Domestic Franchise. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
International Franchise. . . . . . . . . . . . . . . . . . . . . . . . . . .
KK Supply Chain:
Total revenues. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less - intersegment sales elimination. . . . . . . . . . . . .
External KK Supply Chain revenues. . . . . . . . . . .
Total revenues . . . . . . . . . . . . . . . . . . . . . . . . .
Company Stores
Domestic Franchise
KK Supply Chain
Total segment operating income. . . . . . . . . . . . . . . . .
(including depreciation and amortization expense). . . . .
Impairment charges and lease termination costs. . . . . . . . . .
Consolidated operating income. . . . . . . . . . . . . . . . . . . . .
Quarter Ended
July 31,
October 30,
2011
2011
(In thousands)
January 29,
2012
$ 69,475
2,369
5,636
$ 65,992
2,349
5,352
$ 67,606
2,327
5,374
$ 68,584
2,418
6,259
53,883
(26,763)
27,120
$104,600
50,341
(26,082)
24,259
$ 97,952
50,277
(26,876)
23,401
$ 98,708
51,952
(27,256)
24,696
$101,957
$ (1,049)
216
3,409
7,745
10,321
(5,083)
(301)
$ 4,937
(5,155)
(135)
$ 5,550
2,174
1,147
4,171
8,342
15,834
(5,799)
(244)
$ 9,791
(574)
1,114
3,313
6,987
10,840
(267)
1,260
4,161
7,086
12,240
(6,838)
(113)
$ 5,289
(1) The provision for income taxes in the quarter ended January 29, 2012 includes a credit of $139.6 million for the
reversal of valuation allowances on deferred tax assets.
Item 9.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND

FINANCIAL DISCLOSURE.
None.
Item 9A.
CONTROLS AND PROCEDURES.
Evaluation of Disclosure Controls and Procedures

As of February 3, 2013, the end of the period covered by this Annual Report on Form 10-K, management
performed, under the supervision and with the participation of the Companys chief executive officer and chief
financial officer, an evaluation of the effectiveness of the Companys disclosure controls and procedures as defined
in Rules 13a-15(e) and 15d-15(e) of the Exchange Act. The Companys disclosure controls and procedures are
designed to ensure that information required to be disclosed in the reports the Company files or submits under
the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the
SECs rules and forms, and that such information is accumulated and communicated to management, including
the Companys chief executive officer and chief financial officer, to allow timely decisions regarding required
disclosures. Based on this evaluation, the Companys chief executive officer and chief financial officer have
concluded that, as of February 3, 2013, the Companys disclosure controls and procedures were effective.
125

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 126

OPERATOR PM10

Managements Report on Internal Control over Financial Reporting
Management is responsible for establishing and maintaining adequate internal control over financial
reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act. Internal control over
financial reporting is a process, effected by an entitys board of directors, management and other personnel,
designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of
consolidated financial statements for external purposes in accordance with GAAP. Internal control over financial
reporting includes those policies and procedures which pertain to the maintenance of records that, in reasonable
detail, accurately and fairly reflect the transactions and dispositions of assets; provide reasonable assurance that
transactions are recorded as necessary to permit preparation of consolidated financial statements in accordance
with GAAP; provide reasonable assurance that receipts and expenditures are being made only in accordance
with managements and/or the Board of Directors authorization; and provide reasonable assurance regarding
prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a
material effect on our consolidated financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect
material errors in our financial statements. Also, projection of any evaluation of the effectiveness of our internal
control over financial reporting to future periods is subject to the risk that controls may become inadequate
because of changes in conditions, because the degree of compliance with our policies and procedures may
deteriorate.
Management assessed the effectiveness of our internal control over financial reporting as of February 3,
2013, using the criteria established in Internal Control Integrated Framework issued by the Committee of
Sponsoring Organizations of the Treadway Commission (COSO). Based on our assessment, management has
concluded that we maintained effective internal control over financial reporting as of February 3, 2013, based on
the COSO criteria.
The effectiveness of the Companys internal control over financial reporting as of February 3, 2013, has
been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their
report which appears herein.
Changes in Internal Control Over Financial Reporting
During the quarter ended February 3, 2013, there were no changes in the Companys internal control over
financial reporting that materially affected, or are reasonably likely to materially affect, the Companys internal
control over financial reporting.
Item 9B.
OTHER INFORMATION.
None.
126
REVISION 4
TYPE Clean
JOB NUMBER 246088
SERIAL <12345678>
PAGE NO. 127

OPERATOR PM10
PART III
Item 10.
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.
Except as set forth below, the information required by this item is contained in our proxy statement for
our 2013 Annual Meeting of Shareholders to be held on June 18, 2013, to be filed pursuant to Section 14 of the
Exchange Act, and is incorporated herein by reference.
NYSE and SEC Certifications
In accordance with Section 303A.12(a) of the NYSE Listed Company Manual, the Chief Executive Officer
of the Company submits annual certifications to the NYSE stating that he is not aware of any violations by the
Company of the NYSE corporate governance listing standards, qualifying the certification to the extent necessary.
The last such annual certification was submitted on June 25, 2012 and contained no qualifications.
We have filed certifications executed by our Chief Executive Officer and Chief Financial Officer with the
SEC pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act as exhibits to this Annual Report on Form 10-K.
Item 11.
EXECUTIVE COMPENSATION.
The information required by this item is contained in our proxy statement for our 2013 Annual Meeting
of Shareholders to be held on June 18, 2013, to be filed pursuant to Section 14 of the Exchange Act, and is
incorporated herein by reference.
Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
AND RELATED STOCKHOLDER MATTERS.
Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR
INDEPENDENCE.
Item 14.
PRINCIPAL ACCOUNTANT FEES AND SERVICES
127
REVISION 4
TYPE Clean
JOB NUMBER 246088
SERIAL <12345678>
PAGE NO. 128

OPERATOR PM10
PART IV
Item 15.
EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
(a) Financial Statements and Schedules

1.
2.
Financial Statements. See Item 8, Financial Statements and Supplementary Data.. . . . . . . . . . . .
78
Financial Statement Schedules.
For each of the three fiscal years in the period ended February 3, 2013:
Schedule I Condensed Financial Information of Registrant. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
134
Exhibits. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
138
3.
Exhibit
Number
3.1
3.2
4.1
4.2
10.1
10.2
10.3
10.4
10.5
10.6
10.7
Description of Exhibits
Restated Articles of Incorporation of the Registrant (incorporated by reference to exhibit 3.1 to the
Registrants Annual Report on Form 10-K filed on April 15, 2010)
Amended and Restated Bylaws of the Registrant (incorporated by reference to Exhibit 3.1 to the
Registrants Current Report on Form 8-K filed on December 15, 2008)
Form of Certificate for Common Stock (incorporated by reference to Exhibit 4.1 to the Registrants
Amendment No. 4 to Registration Statement on Form S-1 (Commission File No. 333-92909) filed on
April 3, 2000)
Tax Asset Protection Plan between the Krispy Kreme Doughnuts, Inc. and American Stock Transfer
& Trust Company, LLC, as Rights Agent, dated as of January 14, 2013 (incorporated by reference to
Exhibit 4.1 to the Registrants Current Report on Form 8-K filed on January 15, 2013)
Trademark License Agreement, dated May 27, 1996, between HDN Development Corporation and
Krispy Kreme Doughnut Corporation (incorporated by reference to Exhibit 10.22 to the Registrants
Amendment No. 1 to Registration Statement on Form S-1 (Commission File No. 333-92909), filed
on February 22, 2000)
Amended and Restated Employment Agreement, dated as of March 11, 2011, among Krispy Kreme
Doughnuts, Inc., Krispy Kreme Doughnut Corporation and James H. Morgan (incorporated by
reference to Exhibit 10.1 to the Registrants Current Report on Form 8-K filed on March 17, 2011)**
Doughnuts, Inc., Krispy Kreme Doughnut Corporation and Douglas R. Muir (incorporated by
Doughnuts, Inc., Krispy Kreme Doughnut Corporation and Jeffrey B. Welch (incorporated by
Doughnuts, Inc., Krispy Kreme Doughnut Corporation and Kenneth J. Hudson (incorporated by
Doughnuts, Inc., Krispy Kreme Doughnut Corporation and M. Bradley Wall (incorporated by
Amended and Restated Employment Agreement, dated as of March 11, 2011, among Krispy
Kreme Doughnuts, Inc., Krispy Kreme Doughnut Corporation and Cynthia A. Bay (incorporated
by reference to Exhibit 10.8 to the Registrants Annual Report on Form 10-K filed on
March 31, 2011)**
128

JOB NUMBER 246088
Exhibit
Number
10.8
10.9
10.10
10.11
10.12
10.13
10.14
10.15
10.16
10.17
10.18
10.19
10.20
10.21
10.22
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 129

OPERATOR PM10
Doughnuts, Inc., Krispy Kreme Doughnut Corporation and Darryl R. Marsch (incorporated
March 31, 2011)**
Amended and Restated Employment Agreement, dated as of March 11, 2011, among Krispy
Kreme Doughnuts, Inc., Krispy Kreme Doughnut Corporation and G. Dwayne Chambers
(incorporated by reference to Exhibit 10.10 to the Registrants Annual Report on Form 10-K filed on
March 31, 2011)*
Krispy Kreme Doughnut Corporation Nonqualified Deferred Compensation Plan, effective
October1, 2000 (incorporated by reference to Exhibit 10.20 to the Registrants Annual Report on
Form 10-K for fiscal 2005 filed on April 28, 2006)**
1998 Stock Option Plan dated August 6, 1998 (incorporated by reference to Exhibit 10.23 to the
Registrants Amendment No. 1 to Registration Statement on Form S-1 (Commission File No.
333-92909) filed on February 22, 2000)**
2000 Stock Incentive Plan, as amended as of January 31, 2011 (incorporated by reference to
Exhibit10.14 to the Registrants Annual Report on Form 10-K filed on March 31, 2011)**
Form of Restricted Stock Agreement under the 2000 Stock Incentive Plan (incorporated
April 17, 2009) **
Form of Restricted Stock Unit Agreement under the 2000 Stock Incentive Plan (incorporated by
Form of Director Restricted Stock Unit Agreement under the 2000 Stock Incentive Plan
(incorporated by reference to Exhibit 10.17 to the Registrants Annual Report on Form 10-K filed on
March 31, 2011)**
Form of Nonqualified Stock Option Agreement under the 2000 Stock Incentive Plan
(incorporated by reference to Exhibit 10.7 to the Registrants Current Report on Form 8-K filed on
March 17, 2011)**
Form of Incentive Stock Option Agreement under the 2000 Stock Incentive Plan (incorporated by
reference Exhibit 10.1 to the Registrants Current Report on Form 8-K filed on February 3, 2011)**
2012 Stock Incentive Plan, effective June 12, 2012 (incorporated by reference to Exhibit 10.1 to the
Registrants Current Report on Form 8-K filed on June 14, 2012)**
Form of Nonqualified Stock Option Agreement under the 2012 Stock Incentive Plan (incorporated
by reference to Exhibit 10.1 to the Registrants Quarterly Report on Form 10-Q filed on
December 7, 2012)**
Form of Incentive Stock Option Agreement under the 2012 Stock Incentive Plan (incorporated
December 7, 2012)**
Form of Restricted Stock Award Agreement under the 2012 Stock Incentive Plan (incorporated
December 7, 2012)**
Form of Restricted Stock Unit Agreement under the 2012 Stock Incentive Plan (incorporated
December 7, 2012)**
129

JOB NUMBER 246088
Exhibit
Number
10.23
10.24
10.25
10.26
10.27
10.28
10.29
10.30
10.31
10.32
10.32
21*
23*
24*
31.1*
31.2*
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 130

OPERATOR PM10
Form of Director Restricted Stock Unit Agreement under the 2012 Stock Incentive Plan
(incorporated by reference to Exhibit 10.5 to the Registrants Quarterly Report on Form 10-Q filed
on December 7, 2012)**
Form of Director Nonqualified Stock Option Agreement under the 2012 Stock Incentive Plan
on December 7, 2012)**
Annual Incentive Plan (incorporated by reference to Exhibit 10.32 to the Registrants Annual Report
on Form 10-K filed on April 17, 2008)**
Compensation Recovery Policy (incorporated by reference to Exhibit 10.35 to the Registrants
Annual Report on Form 10-K filed on April 17, 2009)**
Credit Agreement, dated as of January 28, 2011, among Krispy Kreme Doughnut Corporation,
Krispy Kreme Doughnuts, Inc., the Lenders party thereto and Wells Fargo Bank, National
Association, as administrative agent (incorporated by reference to Exhibit 10.1 to the Registrants
Current Report on Form 8-K filed on February 1, 2011)
Amendment No. 1, dated as of September 15, 2011, to the Credit Agreement dated as of
January 28, 2011, among Krispy Kreme Doughnut Corporation, Krispy Kreme Doughnuts, Inc.,
the Lenders party thereto and Wells Fargo Bank, National Association, as administrative agent
on December 2, 2011)
Security Agreement, dated as of January 28, 2011, among Krispy Kreme Doughnut Corporation,
Krispy Kreme Doughnuts, Inc., the Pledgors party thereto and Wells Fargo Bank, National
Guaranty Agreement, dated as of January 28, 2011, among Krispy Kreme Doughnuts, Inc., the
Subsidiary Guarantors party thereto, the Lenders party thereto and Wells Fargo Bank, National
Form of Indemnification Agreement entered into between Krispy Kreme Doughnuts, Inc. and
Lizanne Thomas and Michael Sutton (incorporated by reference to Exhibit 99.3 to the Registrants
Current Report on Form 8-K filed on October 8, 2004)**
members of the Registrants Board of Directors (other than Lizanne Thomas and Michael Sutton)
(incorporated by reference to Exhibit 10.42 to the Registrants Annual Report on Form 10-K for
fiscal 2005 filed on April 26, 2006)**
Officers of the Registrant (incorporated by reference to Exhibit 10.1 to the Registrants Current
Report on Form 8-K filed on September 18, 2007)
List of Subsidiaries
Consent of PricewaterhouseCoopers LLP
Powers of Attorney of certain officers and directors of the Company (included on the signature page
of this Annual Report on Form 10-K)
Certification of Chief Executive Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the
Securities Exchange Act of 1934, as amended
Certification of Chief Financial Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the
Securities Exchange Act of 1934, as amended
130

JOB NUMBER 246088
Exhibit
Number
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 131

OPERATOR PM10
32.1* Certification by Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002
32.2* Certification by Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002
101 The following materials from our Annual Report on Form 10-K for the year ended February3,2013
, formatted in XBRL (eXtensible Business Reporting Language): (i) the Consolidated Statement
of Income for each of the three years in the period ended February 3, 2013 ; (ii)Consolidated
Statement of Comprehensive Income for each of the three years in the period ended
February 3, 2013; (iii) the Consolidated Balance Sheet as of February 3, 2013 and January 29, 2012;
(iv) the Consolidated Statement of Cash Flows for each of the three years in the period ended
February 3, 2013 ; (v) the Consolidated Statement of Changes in Shareholders Equity for each
of the three years in the period ended February 3, 2013 ; and (vi) the Notes to the Consolidated
Financial Statements***
* Filed herewith
** Identifies management contracts and executive compensation plans or arrangements required to be filed as
exhibits pursuant to Item 15(b), Exhibits and Financial Statement Schedules Exhibits, of this Annual
Report on Form 10-K.
*** Pursuant to Rule 406T of Regulation S-T, the Interactive Data Files on Exhibit 101 hereto are deemed not
filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of
1933, as amended, are deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as
amended, and otherwise are not subject to liability under those sections.
Our SEC file number for documents filed with the SEC pursuant to the Securities Exchange Act of 1934, as
amended, is 001-16485.
131
REVISION 4
SERIAL <12345678>
TYPE Clean
JOB NUMBER 246088
PAGE NO. 132

OPERATOR PM10
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant
has duly caused this report to be signed on its behalf by the undersigned, thereunto dulyauthorized.
Date: April 19,2013
Krispy Kreme Doughnuts,Inc.
By: /s/ Douglas R. Muir

Name: Douglas R. Muir
Title: Executive Vice President and Chief
Financial Officer
(Duly Authorized Officer and Principal FinancialOfficer)

POWER OF ATTORNEY
Each person whose signature appears below hereby constitutes and appoints James H. Morgan and
Douglas R. Muir, or either of them, his or her true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for him or her and in his or her name, place and stead, in any and all capacities,
to sign any or all amendments or supplements to this Annual Report on Form 10-K and to file the same with all
exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission,
granting unto said attorney-in-fact and agent full power and authority to do and perform each and every act
and thing necessary or appropriate to be done with this Annual Report on Form 10-K and any amendments or
supplements hereto, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying
and confirming all that said attorney-in-fact and agent, or his or her substitute or substitutes, may lawfully do or
cause to be done by virtuehereof.
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by
the following persons on behalf of the Registrant and in the capacities indicated on : April 19,2013.
Signature
/s/ James H. Morgan

James H. Morgan
/s/ Douglas R. Muir

Douglas R. Muir
/s/ Charles A. Blixt

Charles A. Blixt
/s/ Lynn Crump-Caine

Lynn Crump-Caine
/s/ C. Stephen Lynn

C. Stephen Lynn
/s/ Robert S. McCoy,Jr.

Robert S. McCoy,Jr.
Title
Chairman of the Board of Directors and Chief

Executive Officer (Principal ExecutiveOfficer)
Executive Vice President and Chief Financial Officer

(Principal Financial and AccountingOfficer)
Director
Director
Director
Director
132
REVISION 4
TYPE Clean
JOB NUMBER 246088
SERIAL <12345678>
PAGE NO. 133
Signature
/s/ Andrew J. Schindler

Andrew J. Schindler
/s/ Michael H. Sutton

Michael H. Sutton
/s/ Lizanne Thomas

Lizanne Thomas
/s/ Togo D. West,Jr.

Togo D. West,Jr.

OPERATOR PM10
Title
Director
Director
Director
Director
133

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 134
This page intentionally left blank.

OPERATOR PM10
REVISION 4
TYPE Clean
JOB NUMBER 246088
SERIAL <12345678>
PAGE NO. 135

OPERATOR PM10
EXHIBIT 31.1
CERTIFICATION OF CHIEF EXECUTIVE OFFICER
I, James H. Morgan, certifythat:
1.
I have reviewed this Annual Report on Form 10-K of Krispy Kreme Doughnuts,Inc.;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit
to state a material fact necessary to make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by thisreport;
3. Based on my knowledge, the financial statements, and other financial information included in this
report, fairly present in all material respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in thisreport;
4. The registrants other certifying officer(s) and I are responsible for establishing and maintaining
disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control
over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant andhave:
a. Designed such disclosure controls and procedures, or caused such disclosure controls and
procedures to be designed under our supervision, to ensure that material information relating to the
registrant, including its consolidated subsidiaries, is made known to us by others within those entities,
particularly during the period in which this report is beingprepared;
b. Designed such internal control over financial reporting, or caused such internal control over
financial reporting to be designed under our supervision, to provide reasonable assurance regarding
the reliability of financial reporting and the preparation of financial statements for external purposes in
accordance with generally accepted accountingprinciples;
c. Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in
this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of
the period covered by this report based on such evaluation; and
d. Disclosed in this report any change in the registrants internal control over financial reporting that
occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case
of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants
internal control over financial reporting; and
5. The registrants other certifying officer(s) and I have disclosed, based on our most recent evaluation
of internal control over financial reporting, to the registrants auditors and the audit committee of the registrants
board of directors (or persons performing the equivalentfunctions):
a. All significant deficiencies and material weaknesses in the design or operation of internal control
over financial reporting which are reasonably likely to adversely affect the registrants ability to record,
process, summarize and report financial information; and
b. Any fraud, whether or not material, that involves management or other employees who have a
significant role in the registrants internal control over financialreporting.
Date: April 19, 2013
/s/ James H. Morgan
James H. Morgan
REVISION 4
TYPE Clean
JOB NUMBER 246088
SERIAL <12345678>
PAGE NO. 136

OPERATOR PM10
EXHIBIT 31.2
CERTIFICATION OF CHIEF FINANCIAL OFFICER
I, Douglas R. Muir, certifythat:
1.
I have reviewed this Annual Report on Form 10-K of Krispy Kreme Doughnuts,Inc.;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit
to state a material fact necessary to make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by thisreport;
3. Based on my knowledge, the financial statements, and other financial information included in this
report, fairly present in all material respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in thisreport;
4. The registrants other certifying officer(s) and I are responsible for establishing and maintaining
disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control
over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant andhave:
a. Designed such disclosure controls and procedures, or caused such disclosure controls and
procedures to be designed under our supervision, to ensure that material information relating to the
registrant, including its consolidated subsidiaries, is made known to us by others within those entities,
particularly during the period in which this report is beingprepared;
b. Designed such internal control over financial reporting, or caused such internal control over
financial reporting to be designed under our supervision, to provide reasonable assurance regarding
the reliability of financial reporting and the preparation of financial statements for external purposes in
accordance with generally accepted accountingprinciples;
c. Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in
this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of
the period covered by this report based on such evaluation; and
d. Disclosed in this report any change in the registrants internal control over financial reporting that
occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case
of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants
internal control over financial reporting; and
5. The registrants other certifying officer(s) and I have disclosed, based on our most recent evaluation
of internal control over financial reporting, to the registrants auditors and the audit committee of the registrants
board of directors (or persons performing the equivalentfunctions):
a. All significant deficiencies and material weaknesses in the design or operation of internal control
over financial reporting which are reasonably likely to adversely affect the registrants ability to record,
process, summarize and report financial information; and
b. Any fraud, whether or not material, that involves management or other employees who have a
significant role in the registrants internal control over financialreporting.
/s/ Douglas R. Muir
Douglas R. Muir
Chief Financial Officer

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 137

OPERATOR PM10
EXHIBIT 32.1
CERTIFICATION
PURSUANT TO 18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO SECTION 906 OF THE
SARBANES-OXLEY ACT OF 2002
I, James H. Morgan, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, that the accompanying Annual Report on Form 10-K of Krispy Kreme Doughnuts,
Inc. (the Company) for the fiscal year ended February 3, 2013 fully complies with the requirements of Section
13(a) or 15(d) of the Securities Exchange Act of 1934 and the information contained in such report fairly presents,
in all material respects, the financial condition and results of operations of theCompany.
/s/ James H. Morgan
James H. Morgan
This certification shall not be deemed to be filed for the purpose of Section 18 of the Securities Exchange
Act of 1934, as amended, and will not be incorporated by reference into any registration statement filed under
the Securities Act of 1933, as amended, unless specifically identified therein as being incorporated therein
byreference.
A signed original of this written statement required by Section 906 has been provided to Krispy Kreme
Doughnuts, Inc. and will be retained by Krispy Kreme Doughnuts, Inc. and furnished to the Securities and
Exchange Commission or its staff uponrequest.

JOB NUMBER 246088
REVISION 4
TYPE Clean
SERIAL <12345678>
PAGE NO. 138

OPERATOR PM10
EXHIBIT 32.2
CERTIFICATION
PURSUANT TO 18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO SECTION 906 OF THE
SARBANES-OXLEY ACT OF 2002
I, Douglas R. Muir, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, that the accompanying Annual Report on Form 10-K of Krispy Kreme Doughnuts,
Inc. (the Company) for the fiscal year ended February 3, 2013 fully complies with the requirements of Section
13(a) or 15(d) of the Securities Exchange Act of 1934 and the information contained in such report fairly presents,
in all material respects, the financial condition and results of operations of theCompany.
/s/ Douglas R. Muir
Douglas R. Muir
Chief Financial Officer
This certification shall not be deemed to be filed for the purpose of Section 18 of the Securities Exchange
Act of 1934, as amended, and will not be incorporated by reference into any registration statement filed under
the Securities Act of 1933, as amended, unless specifically identified therein as being incorporated therein
byreference.
A signed original of this written statement required by Section 906 has been provided to Krispy Kreme
Doughnuts, Inc. and will be retained by Krispy Kreme Doughnuts, Inc. and furnished to the Securities and
Exchange Commission or its staff uponrequest.
laid the
gapore,
, while
.
Social Media Success
djusted
et cash
e price
ho bring
preciate
only for
pride in
o please
motional
y morno do so.
te night
stomers
pand our
itality.
Krispy Kreme Doughnuts
Hot Light App
Over 4.6 Million Likes
Over 300,000 Downloads
Our fans get instant news on featured
A lot of our Krispy Kreme fans have
doughnuts, beverages and promotions,
downloaded the smart phone app, which has
delivered straight to their desktop, tablet

or mobile device.
enabled them to know when to get the hot,

melt-in-your-mouth doughnuts they crave
while also receiving
targeted banner ads for
promotions or special
limited time offerings.
that our
omestic
u of oneill entail
developugh new
r adding
allenges.
ges with
compatunities,
Krispy Kremes amazing

fan following was largely
built on word-of-mouth.
Utilizing social media tools
as part of our marketing
strategy is a natural evolution
for our one-of-a-kind
brand experience.
Brian K. Little
Communications Director
KRISPY KREME
DOUGHNUTS, INC.
370 Knollwood Street,
Winston-Salem, NC 27103
1-800-334-1243
For more details visit us at
krispykreme.com
2013 KKDC

Krispy Kreme Annual Report

Uploaded by

Copyright:

Available Formats

Krispy Kreme Annual Report

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Krispy Kreme Annual Report

Uploaded by

Copyright:

Available Formats

What were Krispy Kreme's financial highlights in fiscal year 2013?

What were Krispy Kreme's financial highlights in fiscal year 2013?

What are some of Krispy Kreme's strategies to drive new use occasions and engage customers?

What are some of Krispy Kreme's strategies to drive new use occasions and engage customers?

F I S C A L

Dear Fellow Shareholders:

We signed international development agreements for Taiwan, Singapore,

JOB TITLE Krispy Kreme 10K

JOB NUMBER 246088

DATE Thursday, April 25, 2013

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)

KRISPY KREME DOUGHNUTS, INC.

(State or other jurisdiction of

(I.R.S. Employer Identification No.)

370 Knollwood Street,

(Address of principal executive offices)

Registrants telephone number, including area code:

Title of Each Class

Common Stock, No Par Value

New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act:

JOB TITLE Krispy Kreme 10K

DATE Thursday, April 25, 2013

Market for Registrants Common Equity, Related Stockholder Matters

Directors, Executive Officers and Corporate Governance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

JOB TITLE Krispy Kreme 10K

DATE Thursday, April 25, 2013

JOB TITLE Krispy Kreme 10K

JOB NUMBER 246088

DATE Thursday, April 25, 2013

JOB TITLE Krispy Kreme 10K

DATE Thursday, April 25, 2013

The Company and its franchisees sell products through twochannels:

JOB TITLE Krispy Kreme 10K

DATE Thursday, April 25, 2013

JOB TITLE Krispy Kreme 10K

JOB NUMBER 246088

DATE Thursday, April 25, 2013

JOB TITLE Krispy Kreme 10K

DATE Thursday, April 25, 2013

JOB TITLE Krispy Kreme 10K

DATE Thursday, April 25, 2013

JOB TITLE Krispy Kreme 10K

DATE Thursday, April 25, 2013

JOB TITLE Krispy Kreme 10K

DATE Thursday, April 25, 2013

Continuing to Invest in Research and Development

JOB TITLE Krispy Kreme 10K

DATE Thursday, April 25, 2013

Percentage of Retail Sales

JOB TITLE Krispy Kreme 10K

DATE Thursday, April 25, 2013

JOB TITLE Krispy Kreme 10K

DATE Thursday, April 25, 2013

JOB TITLE Krispy Kreme 10K

DATE Thursday, April 25, 2013

JOB TITLE Krispy Kreme 10K

DATE Thursday, April 25, 2013