|
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 |
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| FORM 11-K | ||||
| (X) | ANNUAL REPORT PURSUANT TO SECTION 15 (d) OF | |||
| THE SECURITIES EXCHANGE ACT OF 1934 | ||||
| For the fiscal year ended December 31, 2008 | ||||
| OR | ||||
| ( ) | TRANSITION REPORT PURSUANT TO SECTION 15 (d) OF | |||
| THE SECURITIES EXCHANGE ACT OF 1934 | ||||
| For the transition period from to | ||||
| Commission file number 001-16485 | ||||
| A. | Full title of the plan and the address of the plan, if different from that of the issuer named below: |
|
KRISPY KREME DOUGHNUT CORPORATION
RETIREMENT SAVINGS
PLAN |
| B. | Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: |
KRISPY KREME DOUGHNUTS, INC.
370
KNOLLWOOD STREET, SUITE 500
WINSTON-SALEM, NC 27103
| Krispy Kreme Doughnut Corporation Retirement Savings Plan |
| Index |
| December 31, 2008 and 2007 |
| Page(s) | ||
| Report of Independent Registered Public Accounting Firms | 1-2 | |
| Financial Statements | ||
| Statement of Net Assets Available for Plan Benefits | ||
| December 31, 2008 and 2007 | 3 | |
| Statement of Changes in Net Assets Available for Plan Benefits | ||
| Years Ended December 31, 2008 and 2007 | 4 | |
| Notes to Financial Statements | 5-12 | |
| Supplemental Schedules* | ||
| Schedule H, line 4i - Schedule of Assets (Held at End of Year) | ||
| December 31, 2008 | 13 | |
| Schedule G, Financial Transaction Schedules | ||
| December 31, 2008 | 14 |
| * | Other schedules required by Section 2520.103-10 of the Department of Labor Rules and Regulations for Reporting and Disclosure under ERISA have been omitted because they are not applicable |
Exhibit 23.1 – Consent of Independent Registered
Public Accounting Firm
Exhibit 23.2 – Consent of Independent Registered
Public Accounting Firm
Report of Independent Registered Public Accounting Firm
To
the Participants and Administrator of
The
Krispy Kreme Doughnut Corporation
Retirement Savings Plan
We have audited the accompanying statement of net assets available for benefits of the Krispy Kreme Doughnut Corporation Retirement Savings Plan (the “Plan”) at December 31, 2008, and the related statement of changes in net assets available for benefits for the year then ended. These financial statements are the responsibility of the Plan’s management. Our responsibility is to express an opinion on these financial statements based on our audit.
We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Plan is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts of disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the net assets available for benefits of the Plan as of December 31, 2008, and the changes in net assets available for benefits for the year then ended in conformity with accounting principles generally accepted in the United States of America.
Our audit was conducted for the purpose of forming an opinion on the basic financial statements taken as a whole. The schedule of assets held at end of year and financial transactions schedules are presented for purposes of additional analysis and are not a required part of the basic financial statements but are supplementary information required by the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. These supplemental schedules are the responsibility of the Plan's management. These supplemental schedules have been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, are fairly stated in all material respects in relation to the basic financial statements taken as a whole.
As more fully described in Note 1 to the financial statements, contributions to the Employer Stock Fund were suspended effective November 2005. In addition, the Company merged the Krispy Kreme Profit-Sharing Stock Ownership Plan into the Plan effective June 1, 2007, as described in Note 1.
/s/ Witt Mares, PLLC
Richmond, Virginia
June 24, 2009
1
Report of Independent Registered Public Accounting Firm
To
the Participants and Administrator of
The
Krispy Kreme Doughnut Corporation
Retirement Savings Plan
In our opinion, the accompanying statement of net assets available for benefits and the related statement of changes in net assets available for benefits present fairly, in all material respects, the net assets available for benefits of the Krispy Kreme Doughnut Corporation Retirement Savings Plan (the “Plan”) at December 31, 2007, and the changes in net assets available for benefits for the year then ended in conformity with accounting principles generally accepted in the United States of America. These financial statements are the responsibility of the Plan’s management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audit of these statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes 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. We believe that our audit provide a reasonable basis for our opinion.
As more fully described in Note 1 to the financial statements, contributions to the Employer Stock Fund were suspended effective November 2005. In addition, the Company merged the Krispy Kreme Profit-Sharing Stock Ownership Plan into the Plan effective June 1, 2007, as described in Note 1.
/s/ PricewaterhouseCoopers LLP
Charlotte, North Carolina
June 27,
2008
2
| Krispy Kreme Doughnut Corporation Retirement Savings Plan |
| Statement of Net Assets Available for Plan Benefits |
| December 31, 2008 and 2007 |
| 2008 | 2007 | ||||||
| Assets | |||||||
| Cash and cash equivalents | $ | 4,070 | $ | 21,159 | |||
| Investments, at fair value (Note 3) | 24,587,110 | 28,579,343 | |||||
| Contributions receivable | |||||||
| Employer | 12,135 | 9,089 | |||||
| Employee | 31,595 | 23,301 | |||||
| 43,730 | 32,390 | ||||||
| Litigation settlement receivable (Note 7) | - | 262,098 | |||||
| Total assets, at fair value | 24,634,910 | 28,894,990 | |||||
| Liabilities | |||||||
| Excess contributions due to participants | 99,338 | 74,513 | |||||
| Net assets, at fair value | 24,535,572 | 28,820,477 | |||||
| Adjustment from fair value to contract value for | |||||||
| interest in a collective trust relating to fully | |||||||
| benefit-responsive investment contracts (Note 2) | (49,243 | ) | (52,258 | ) | |||
| Net assets available for plan benefits | $ | 24,486,329 | $ | 28,768,219 | |||
The accompanying notes are an integral part of these financial statements.
3
| Krispy Kreme Doughnut Corporation Retirement Savings Plan |
| Statement of Changes in Net Assets Available for Plan Benefits |
| Years Ended December 31, 2008 and 2007 |
| 2008 | 2007 | ||||||
| Additions to net assets attributed to: | |||||||
| Contributions | |||||||
| Employer | $ | 779,114 | $ | 823,727 | |||
| Employee | 1,984,025 | 2,161,018 | |||||
| Rollovers | 21,970 | 10,943 | |||||
| 2,785,109 | 2,995,688 | ||||||
| Investment income (loss) | |||||||
| Interest and dividends | 881,554 | 1,549,623 | |||||
| Net depreciation in fair value of investments | (4,775,053 | ) | (2,668,514 | ) | |||
| (3,893,499 | ) | (1,118,891 | ) | ||||
| Litigation settlements (Note 7) | - | 3,735,855 | |||||
| Merger of the Krispy Kreme Profit-Sharing | |||||||
| Stock Ownership Plan net assets (Notes 1 and 7) | - | 3,528,229 | |||||
| Total additions (deductions) | (1,108,390 | ) | 9,140,881 | ||||
| Deductions from net assets attributed to: | |||||||
| Benefits paid to participants | 3,105,057 | 4,819,105 | |||||
| Administrative expenses | 68,443 | 82,731 | |||||
| Total deductions | 3,173,500 | 4,901,836 | |||||
| Net increase (decrease) in net assets | (4,281,890 | ) | 4,239,045 | ||||
| Net assets available for plan benefits: | |||||||
| Beginning of year | 28,768,219 | 24,529,174 | |||||
| End of year | $ | 24,486,329 | $ | 28,768,219 | |||
The accompanying notes are an integral part of these financial statements.
4
| Krispy Kreme Doughnut Corporation Retirement Savings Plan |
| Notes to Financial Statements |
| December 31, 2008 and 2007 |
| 1. | Description of the Plan | |
| The following description of the Krispy Kreme Doughnut Corporation (the “Company”) Retirement Savings Plan (the “Plan”) provides only general information. Participants should refer to the Plan agreement for a more complete description of the Plan’s provisions. | ||
| General | ||
| The Plan is a defined contribution plan established under section 401(k) of the Internal Revenue Code (“IRC”) which allows voluntary contributions by participants. The Plan is available to employees of the Company who have met certain age and service requirements. The Plan administrator and management of the Company believe that the Plan conforms with the requirements of the Employee Retirement Income Security Act of 1974 (“ERISA”). | ||
| Trustee | ||
| Branch Banking and Trust Company (the “Trustee”) is trustee and recordkeeper of the Plan. | ||
| Administration | ||
| The Plan administrator is the Company. | ||
| Retirement | ||
| The normal retirement date is the day on which a participant attains the age of 65. | ||
| Plan Merger | ||
|
On June 1, 2007, the Company merged the Krispy Kreme Profit-Sharing Stock Ownership Plan (the “KSOP”) into the Plan in connection with the settlement of certain litigation discussed in Note 7. |
||
| Contributions | ||
| Participants may make pretax salary reduction contributions to the Plan through payroll deductions not to exceed 100% of their eligible compensation, which consists of annual base salary plus the amount of any bonus or incentive award, up to the annual Internal Revenue Service (“IRS”) dollar limits. Participants may also make salary reduction contributions of up to 15% of their eligible compensation on an after-tax basis. The total amount of pretax and after-tax salary reduction contributions may not exceed 100% of eligible compensation. The Company matches 50% of the first 6% of compensation each participant contributes to the Plan. | ||
| During 2008 and 2007, certain “highly compensated” employees made contributions to the Plan in excess of the contribution limitations of the IRC. The aggregate amount of such excess contributions as of December 31, 2008 and 2007 was recorded as excess contributions due to participants and was refunded to the participants in 2009 and 2008, respectively. | ||
| Participant Accounts | ||
| Participant accounts are maintained by the Trustee. Each participant’s retirement savings account reflects the participant’s contributions, the Company’s matching contributions with respect to such participant and investment earnings and losses. The benefit to which a participant is entitled is the benefit that can be provided from the participant’s account. | ||
| Vesting | ||
|
Participants are immediately vested in their voluntary and the Company’s matching contributions. |
||
5
| Krispy Kreme Doughnut Corporation Retirement Savings Plan |
| Notes to Financial Statements |
| December 31, 2008 and 2007 |
| Withdrawals | ||
| Participants are entitled to withdraw all or a portion of their account balances upon attainment of age 59-1/2, or any time thereafter. Participants may withdraw account balances prior to age 59-1/2 subject to IRC penalties and only in the event of extreme economic hardship or termination of employment. | ||
| Participant Loans | ||
| A participant may borrow any amount from $1,000 to $50,000 provided the loan does not exceed one-half of the participant’s account balance. Each loan will bear interest at a rate not to exceed the prime interest rate plus one percent in effect on the date the loan is approved. There were $1,885,356 and $1,948,111 of loans receivable from participants at December 31, 2008 and 2007, respectively. Participant loans outstanding at December 31, 2008 are due January 2009 through January 2014 with interest rates ranging from 4.00% to 8.25%. | ||
| Termination of the Plan | ||
| The Company anticipates that the Plan will continue without interruption but reserves the right to discontinue the Plan subject to the provisions of ERISA. In the event of a termination, participant account balances shall be paid in accordance with the provisions of the Plan. | ||
| Investment Options | ||
| A participant may direct employee and employer contributions to any of the investment options offered by the Plan, which are subject to change. In November 2005, the Plan discontinued the common stock of the Company’s parent, Krispy Kreme Doughnuts, Inc., (“KKDI Stock”) as an investment option for both new contributions and for balance transfers from other investment options. | ||
| 2. | Summary of Significant Accounting Policies | |
| Basis of Accounting | ||
|
The Plan prepares its financial statements on the accrual basis of accounting which recognizes investment income when earned and expenses when incurred. |
||
| As described in Financial Accounting Standards Board Staff Position, FSP AAG INV-1 and SOP 94-4-1, “Reporting of Fully Benefit-Responsive Investment Contracts Held by Certain Investment Companies Subject to the AICPA Investment Company Guide and Defined-Contribution Health and Welfare and Pension Plans” (the “FSP”), investment contracts held by a defined-contribution plan are required to be reported at fair value. However, contract value is the relevant measurement attribute for that portion of the net assets available for benefits of a defined-contribution plan attributable to fully benefit-responsive investment contracts because contract value is the amount participants would receive if they were to initiate permitted transactions under the terms of the Plan. The Plan invests in investment contracts through a collective trust. As required by the FSP, the statement of net assets available for plan benefits presents the fair value of the investment in the collective trust, as well as the adjustment of the investment in the collective trust from its fair value to contract value relating to the investment contracts. The statement of changes in net assets available for plan benefits is prepared on a contract value basis. | ||
6
| Krispy Kreme Doughnut Corporation Retirement Savings Plan |
| Notes to Financial Statements |
| December 31, 2008 and 2007 |
| Cash and Cash Equivalents | ||
|
The Plan considers cash on hand, deposits in banks and all highly liquid debt instruments with a maturity of three months or less at date of acquisition to be cash and cash equivalents. |
||
| Valuation of Investments | ||
| The Plan’s investments are stated at fair value. Mutual funds are valued at the net asset value of the shares which are determined by quoted market prices. The value of the KKDI Stock is determined by quoted market prices. Participant loans receivable are valued at cost which approximates fair value. The Plan’s interest in a collective trust (the Federated Capital Preservation Fund) is valued based on information reported by the investment advisor using the audited financial statements of the collective trust at year end. | ||
| In accordance with the policy of stating investments at fair value, the net appreciation or depreciation in fair value of investments for the year is reflected in the statement of changes in net assets available for plan benefits and includes both realized gains or losses and changes in unrealized appreciation or depreciation on those investments. | ||
|
Use of Estimates in the Preparation of Financial Statements |
||
| The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America requires management to make estimates and assumptions that affect the reported amount of net assets available for plan benefits and the reported amount of changes in net assets available for plan benefits and disclosure of contingent assets and liabilities at the date of the financial statements. Actual results could differ from those estimates. | ||
| Expenses of the Plan | ||
|
Fees paid to the Trustee in connection with the administration of the Plan are paid from the Plan’s assets. All other administrative costs associated with the Plan are paid by the Company. |
||
| Payment of Benefits | ||
| Benefit payments are recorded when paid. | ||
| Risk and Uncertainties | ||
|
The Plan has underlying investments that are exposed to various risks, such as interest rate, market and credit risk. Due to the level of risk associated with such investments and the level of uncertainty related to changes in the value of investment securities, it is at least reasonably possible that changes in risks in the near term would materially affect participants’ account balances and the amounts reported in the statements of net assets available for plan benefits and the statements of changes in net assets available for plan benefits. |
||
| Concentration of Credit Risk | ||
| Concentrations of credit risk that arise from financial instruments exist for groups of counterparties when they have similar economic characteristics that would cause their ability to meet contractual obligations to be similarly affected by changes in economic or other conditions. Financial instruments which potentially subject the Plan to concentration of credit risk consist principally of mutual funds, the money market fund, and common stock investments. | ||
7
| Krispy Kreme Doughnut Corporation Retirement Savings Plan |
| Notes to Financial Statements |
| December 31, 2008 and 2007 |
|
Adoption of New Accounting
Standards
FAS 157 establishes 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 as follows: |
| Level 1 | Inputs to the valuation methodology are quoted prices available in active markets for identical assets or liabilities. | ||
| Level 2 | Inputs to the valuation methodology are other than quoted prices in active markets for identical assets 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 market data. | ||
| Level 3 | Inputs to the valuation methodology are 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. | ||
|
The financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. The following is a description of the valuation methodologies used for instruments measured at fair value. |
|||
|
Mutual funds : Valued at the net asset value of shares held by the plan at year end which are determined by quoted market prices. Common stocks : Valued at the quoted market prices reported on the active market on which the individual securities are traded. Collective investment fund : Valued based on information reported by the investment advisor using the audited financial statements of the collective trust at year end. Participant loans : Valued at cost, which approximates fair value. |
|||
8
| Krispy Kreme Doughnut Corporation Retirement Savings Plan |
| Notes to Financial Statements |
| December 31, 2008 and 2007 |
|
The following table sets forth by level, within the fair value hierarchy, the Plan’s assets at fair value as of December 31, 2008: |
| Assets at Fair Value as of December 31, 2008 | ||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||
| Mutual funds | $ | 9,894,677 | $ | - | $ | - | $ | 9,894,677 | ||||
| Common stocks | 522,015 | - | - | 522,015 | ||||||||
| Collective investment fund | - | 12,285,062 | - | 12,285,062 | ||||||||
| Participant loans | - | - | 1,885,356 | 1,885,356 | ||||||||
| Total assets at fair value | $ | 10,416,692 | $ | 12,285,062 | $ | 1,885,356 | $ | 24,587,110 | ||||
|
The table below sets forth a summary of changes in the fair value of the Plan’s level 3 assets for the year ended December 31, 2008: |
| Level 3 Assets | |||
| Year Ended December | |||
| 31, 2008 | |||
| Participant | |||
| Loans | |||
| Balance, beginning of year | $ | 1,948,111 | |
| Purchases, sales, issuances and settlements (net) | (62,755 | ) | |
| Balance, end of year | $ | 1,885,356 | |
9
| Krispy Kreme Doughnut Corporation Retirement Savings Plan |
| Notes to Financial Statements |
| December 31, 2008 and 2007 |
| 3. | Investments | |
|
The Plan’s investments are held by the Trustee. The following table summarizes Plan investments individually representing 5% or more of the Plan’s net assets available for plan benefits at one or both year ends: |
| 2008 | 2007 | |||||
| Federated Capital Preservation Fund | $ | 12,285,062 | $ | 10,565,175 | ||
| BB&T Intermediate U.S. Government Bond Fund | 2,707,666 | 1,472,367 | ||||
| Oakmark Equity and Income Fund | 1,901,253 | 1,660,155 | ||||
| Vanguard 500 Index Fund | 861,784 | 1,563,263 | ||||
| AIM International Growth Fund | 711,339 | 1,682,123 | ||||
| Oppenheimer Main Street Small Cap Fund | 475,364 | 1,125,724 | ||||
| AIM Constellation Fund | - | 1,375,768 | ||||
|
The Plan’s investments (including investments bought, sold and held during the year) depreciated in value as follows: |
| 2008 | 2007 | |||||||
| Mutual funds | $ | (4,303,870 | ) | $ | (170,231 | ) | ||
| KKDI Stock | (471,183 | ) | (2,498,283 | ) | ||||
| Total net depreciation in fair | ||||||||
| value of investments | $ | (4,775,053 | ) | $ | (2,668,514 | ) | ||
| 4. | Related Party Transactions | |
|
Transactions involving the Trustee qualify as party-in-interest transactions. The Trustee receives certain fees associated with the administration of the Plan. Fees paid directly by the Plan to the Trustee for management services and administration of the Plan totaled $68,443 and $82,731 for the years ended December 31, 2008 and 2007, respectively. Additionally, the Trustee receives fees for managing certain funds in which the Plan invests and a portion of the fees paid to the managers of certain of the funds in which the Plan invests that are not managed by the Trustee. These investment management fees are reflected in the return earned on each fund. Prior to November 2005, the Plan offered KKDI Stock as an investment option. Transactions in KKDI Stock qualify as party-in-interest transactions. As a result of the merger of the KSOP, which invested solely in KKDI Stock, into the Plan on June 1, 2007 as discussed in Notes 1 and 7, 405,552 shares of KKDI Stock were transferred to the Plan. The Plan held 310,487 and 372,837 shares of KKDI Stock at December 31, 2008 and 2007, respectively. The stock price was $1.68 and $3.16 per share at December 31, 2008 and 2007, respectively. During the Plan year ended December 31, 2008, 62,350 shares of KKDI Stock were sold or distributed by the Plan; no shares were purchased during the year as KKDI Stock was discontinued as an investment option in November 2005. Effective April 15, 2005, the Company appointed U.S. Trust, N.A. as the independent fiduciary with respect to the Plan’s investments in KKDI Stock. The Company pays the fees of U.S. Trust, N.A. |
10
| Krispy Kreme Doughnut Corporation Retirement Savings Plan |
| Notes to Financial Statements |
| December 31, 2008 and 2007 |
|
Included in Plan assets are shares of mutual funds sponsored by the Trustee that therefore qualify as party-in-interest transactions. At December 31, 2008 and 2007, mutual funds sponsored by the Trustee amounted to $2,710,401 and $2,436,163, respectively. Total interest and dividends received on these investments for the years ended December 31, 2008 and December 31, 2007 were $88,952 and $162,871, respectively. Net depreciation in the fair value of these investments for the years ended December 31, 2008 and December 31, 2007 was $(24,895) and $(107,452), respectively. |
||
| 5. | Reconciliation of Financial Statements to Form 5500 | |
|
The following is a reconciliation of net assets available for plan benefits per the financial statements to the corresponding amounts shown in the Plan’s Form 5500 as of December 31, 2008 and 2007. |
| 2008 | 2007 | |||||
| Net assets available for plan benefits per the financial statements | $ | 24,486,329 | $ | 28,768,219 | ||
| Adjustment from contract value to fair value for fully | ||||||
| benefit-responsive investment contracts | 49,243 | 52,258 | ||||
| Net assets available for plan benefits per the Form 5500 | $ | 24,535,572 | $ | 28,820,477 | ||
|
The following is a reconciliation of investment income (loss) per the financial statements for the years ended December 31, 2008 and 2007 to the corresponding amounts shown in the Plan’s Form 5500. |
| 2008 | 2007 | |||||||
| Total investment loss per the financial statements | $ | (3,893,499 | ) | $ | (1,118,891 | ) | ||
| Adjustment from contract value to fair value for fully | ||||||||
| benefit-responsive investment contracts | (3,015 | ) | 136,641 | |||||
| Total investment loss per the Form 5500 | $ | (3,896,514 | ) | $ | (982,250 | ) | ||
| 6. | Tax Status of the Plan | |
|
The Company has received a favorable IRS determination letter dated August 25, 2005 with respect to the tax status of the Plan. The Company has requested an updated determination letter to give affect to certain amendments to the Plan. The IRS informed the Company that it has received the Company’s request for an updated determination letter but the IRS has not yet acted on such request. The Plan administrator believes that the Plan is designed and currently being operated in compliance with the applicable requirements of the IRC. Accordingly, no provision for income taxes has been made in the accompanying financial statements. The Plan is also subject to rules and regulations promulgated by the Department of Labor (“DOL”) and the IRS. Failure to comply with the provisions of ERISA or the rules and regulations of the DOL and IRS could result in penalties to the Plan and for its sponsor. |
11
| Krispy Kreme Doughnut Corporation Retirement Savings Plan |
| Notes to Financial Statements |
| December 31, 2008 and 2007 |
| 7. | Settlement of Litigation | |
|
On March 16, 2005, the Company was served with a purported class action lawsuit filed in the United States District Court for the Middle District of North Carolina that asserted claims for breach of fiduciary duty under ERISA against the Company and certain of its current and former officers and employees. On May 15, 2006, the Company announced that a proposed settlement had been reached with respect to this matter and the United States District Court entered a final order approving the settlement on January 10, 2007. The Company and the individual defendants denied any and all wrongdoing and paid no money in the settlement. The settlement included a one-time cash payment made to the settlement class by the Company’s insurer in the amount of $4,750,000. After reduction for expenses provided for in the settlement agreement, approximately $3,474,000 was paid to the Plan for allocation to members of the settlement class in the manner set forth in the settlement agreement. On June 1, 2007, the KSOP merged with and into the Plan as provided by the provisions of the litigation settlement agreement. During the Plan year ended December 31, 2007, the Company’s parent settled a securities class action lawsuit and partially settled certain related shareholder derivative litigation. The Plan is among the members of the class participating in the settlement and received approximately $262,000 of the settlement proceeds in 2008. |
1 2
SUPPLEMENTAL SCHEDULES
| Krispy Kreme Doughnut Corporation Retirement Savings Plan |
| Schedule H, line 4i Schedule of Assets (Held at End of Year) |
| December 31, 2008 |
| Description of Investment Including | ||||||||||
| Identity of Issue, Borrower, | Maturity Date, Rate of Interest, | Current | ||||||||
| Lessor or Similar Party | Collateral, Par or Maturity Value | Shares | Cost | value | ||||||
| Federated Capital Preservation Fund | Collective Investment Fund | 1,223,582 | ** | $ | 12,285,062 | |||||
| * | BB&T Intermediate U.S. Government Bond Fund | Mutual Fund | 257,853 | ** | 2,707,666 | |||||
| Oakmark Equity and Income Fund | Mutual Fund | 88,184 | ** | 1,901,253 | ||||||
| American Funds Growth Fund of America | Mutual Fund | 49,312 | ** | 1,002,026 | ||||||
| T. Rowe Price Mid Cap Value Fund | Mutual Fund | 64,435 | ** | 919,482 | ||||||
| Vanguard 500 Index Fund | Mutual Fund | 10,372 | ** | 861,784 | ||||||
| AIM International Growth Fund | Mutual Fund | 38,306 | ** | 711,339 | ||||||
| Royce Total Return Fund | Mutual Fund | 54,659 | ** | 475,536 | ||||||
| Oppenheimer Main Street Small Cap Fund | Mutual Fund | 39,157 | ** | 475,364 | ||||||
| MFS Value Fund | Mutual Fund | 26,084 | ** | 457,509 | ||||||
| * | Krispy Kreme Doughnuts, Inc. | Common Stock | 310,487 | ** | 522,015 | |||||
| Fidelity Advisor Mid Cap Fund | Mutual Fund | 34,263 | ** | 382,718 | ||||||
| Interest Bearing Cash | Cash Equivalents | 3,226 | ** | 3,226 | ||||||
| Non-interest Bearing Cash | Cash | 844 | ** | 844 | ||||||
| * | Participant Loans | Participant Loans Due January 2009 - | ||||||||
| January 2014 (4.0% -8.25%) | - | 1,885,356 | ||||||||
| $ | 24,591,180 | |||||||||
| * | Party in interest. |
| ** |
Cost has been omitted as investment is participant directed. |
13
| Krispy Kreme Doughnut Corporation Retirement Savings Plan |
| Schedule G, Financial Transaction Schedules |
| Part III – Nonexempt Transactions |
| December 31, 2008 |
| Relationship to Plan, Employer, | Description of Transactions Including Maturity Date, | |||
| Identity of Party Involved | or Other Party-In Interest | Rate of Interest, Collateral, Par or Maturity Value | ||
|
Krispy Kreme Securities Litigation
Claims Administrator |
Employer | The employer payment of $262,098 is related to the securities class action litigation settlement. An application for individual exemption was submitted on March 14, 2008 and is pending before the Department of Labor. |
14
Pursuant to the requirements of the Securities Exchange Act of 1934, the trustees (or other persons who administer the employee benefit plan) have duly caused this annual report to be signed on their behalf by the undersigned hereunto duly authorized.
| Krispy Kreme Doughnut Corporation | ||
| Retirement Savings Plan | ||
| Date: June 29, 2009 | /s/ Douglas R. Muir | |
| Douglas R. Muir | ||
| Member of the Retirement | ||
| Savings Plan Committee | ||
Exhibit 23.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We consent to the incorporation by reference in the Registration Statement of Krispy Kreme Doughnuts, Inc. on Form S-8 (File Number 333-38250) of our report dated June 24, 2009, appearing in this Annual Report of Form 11-K of the Krispy Kreme Doughnut Corporation Retirement Savings Plan for the year ended December 31, 2008.
/s/ Witt Mares, PLLC
Richmond, Virginia
June 29, 2009
Exhibit 23.2
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We hereby consent to the incorporation by reference in the Registration Statement on Form S-8 (No. 333-38250) of Krispy Kreme Doughnuts, Inc. of our report dated June 27, 2008 relating to the financial statements of the Krispy Kreme Doughnut Corporation Retirement Savings Plan, which appears in this Form 11-K.
/s/ PricewaterhouseCoopers LLP
Charlotte, North Carolina
June 29, 2009