Document:

Exhibit 10.1

                        Pinpoint Recovery Solutions Corp.
                             4350 W. Cypress Street
                                 Tampa, FL 33607

April 11, 2008

Neucap, Inc.
1120 Pinellas Bay Way
St. Petersburg, Fla 33715

Attention: Kevin Cappock and Robert Neuman

Re: Amendment No. 2 to Promissory Note

Dear Kevin and Robert:

      Reference is hereby made to the Promissory Note, dated June 26, 2007 (the
"Note"), made by Pinpoint Recovery Solutions Corp., a Delaware corporation
("Pinpoint"), in favor of Neucap, Inc., a Florida corporation (formerly named
"S.A.L.T. Payroll Consultants, Inc.") (the "Holder") in original aggregate
principal amount of $1,881,550 (the "Principal"). Reference is also made to the
letter, dated as of January 10, 2007 and headed, "Extension of Maturity Date of
Promissory Note," ("Amendment No. 1 to Promissory Note"), which confirmed that
on July 16, 2007, Pinpoint prepaid to the Holder $20,454 of the then-outstanding
Principal and $8,624 in accrued interest and that as of the date thereof and
hereof, the outstanding Principal owed to the Holder under the Note was and is
$1,861,096. Amendment No. 1 to the Promissory Note further (i) memorialized the
prior understanding between the Holder and Pinpoint that, in exchange for
Pinpoint's promise to pay the Consideration (defined below) to the Holder, the
Note was amended to extend the Maturity Date (as defined in the Note) from
December 26, 2007 to March 31, 2008 (as so extended, the "Extended Maturity
Date"); and (ii) confirmed that the effective date of such amendment is December
26, 2007.

      This letter confirms (i) the understanding between the Holder and Pinpoint
that, in exchange for Pinpoint's promise to pay the Consideration (defined
below) to the Holder, the Note was amended to extend the Extended Maturity Date
(as defined in Amendment No. 1to the Promissory Note) from March 31, 2008 to
March 31, 2009 (the "Second Extended Maturity Date"), (ii) that the accrued
interest as of March 31, 2008 of $108,331 be added to the outstanding Principal
of $1,861,096, making the agreed outstanding Principal equal to $1,969,427 as of
the date hereof, and (iii) that interest payable on this note shall be 7.25% per
annum after March 31, 2008 and shall be calculated on the basis of a 360 day
year for the actual number of days elapsed. In addition, Pinpoint agrees to make
cash payments for both interest and principal when its month-end checking
account balance exceeds $225,000; provided, however, that any such payment will
be limited to the amount that, immediately after effecting such payment, would
reduce Pinpoint's checking account balance to not less than $200,000.

      Pinpoint hereby covenants to pay, and shall pay, to the Holder on the
Second Extended Maturity Date $1,000 in cash or cash equivalent in consideration
for the Holder's agreement to so extend the Maturity Date (the "Consideration").
The Consideration shall not be included in the Principal, and Pinpoint's
covenant to pay the Consideration shall be deemed an obligation distinct from
and in addition to the obligations of Pinpoint set forth in the Note, as
amended. No interest shall accrue on the Consideration unless and until Pinpoint
shall not have paid the Consideration on or prior to the Second Extended
Maturity Date, and in any such event shall accrue on the same terms as interest
accrues under the Note.

      The Note, as amended through the date hereof, is the entire agreement
between Pinpoint and the Holder with respect to the subject matter thereof and
remains in full force and effect.

      [The signatures to this letter are set forth on the following page.]

<PAGE>

                                                                    Exhibit 10.1

      If this letter accurately describes to date the effective amendments to
the Note, as well as the payments made by Pinpoint under the Note, please
indicate your agreement by signing this letter below.

                                         Sincerely,

                                         PINPOINT RECOVERY SOLUTIONS CORP.

                                         By: /s/ Jon Leslie
                                             -----------------------------------
                                             Jon Leslie, Chief Financial Officer

ACKNOWLEDGED AND AGREED:

Neucap, Inc.

By: /s/ Kevin Cappock
    -----------------
    Kevin Cappock

By: /s/ Robert Neuman
    -----------------
    Robert NeumanKRISPY KREME DOUGHNUT CORPORATION

DEVELOPMENT AGREEMENT

	BASIC
      TERMS 
	A.  	Effective Date  	  	  
	  	(Insert date Franchisee
      executes the  	  	  
	  	agreement):  	  	  
	B.  	Franchisor:  	Krispy Kreme
      Doughnut Corporation, a North Carolina  
	  	 
    	Corporation    
	C.  	Franchisee:  	  	  
	  	Franchisee’s Address:  	  	  
	  	Telephone:  	 	  Fax No.:	 	 
	  	E-mail Address:  	  	  
	D.      	Principal Owners:  	  	  
	E.  	Managing Director:  	  	  
	F.  	Development Area (See
      Exhibit A for  	  	  
	  	more detailed description):  	  	  
	G.  	Development Schedule
      Totals (See  	Cumulative Number of 	End of
      Development Period 
	  	Exhibit A for specific requirements):  	Franchises 	  
	H.  	Development Fee*:  	  	  
	I.  	Initial Franchise
      Fee**:  	Factory Store: $50,000  	Fresh Shop/Kiosk:
      $20,000  
	  	 
    	Hot Shop:
      $30,000  	Commissary
      Facility: $ 0  

	Franchisor:  	                       
    
	  	(initials)
  
	Franchisee:  	  
	  	(initials)
  

____________________
 
* The
Development Fee is equal to 50% of the Initial Franchise Fees for all Stores to
be opened pursuant to the Development Schedule.

** Subject to a dollar-for-dollar credit
equal to the amount of the Development Fee attributable to the particular Store;
the Development Fee will be attributed only to the Stores for which it is paid
and may not be used as a credit for any other Stores.

	TABLE OF
      CONTENTS 
	1. 	BACKGROUND  	1 
	2. 	DEFINITIONS  	1 
	3. 	ACKNOWLEDGMENTS, REPRESENTATIONS, AND WARRANTIES
    	5 
	4. 	TERM/
      FEES /DEVELOPMENT SCHEDULE 	6 
	5. 	BUSINESS PLANS AND MANAGEMENT 	7 
	6. 	GRANT
      OF FRANCHISES 	7 
	7. 	FRANCHISOR’S RIGHTS AND LIMITATIONS/EXCLUSIVITY
    	9 
	8. 	MARKS
      / COPYRIGHTS / CONFIDENTIAL INFORMATION 	10 
	9. 	TRANSFERS 	10 
	10. 	TERMINATION OF DEVELOPMENT RIGHTS 	13 
	11. 	EFFECT OF TERMINATION AND EXPIRATION 	14 
	12. 	RELATIONSHIP OF PARTIES/INDEMNIFICATION 	15 
	13. 	MISCELLANEOUS  	16 
	14.       	ACKNOWLEDGMENTS 	18 
		 	
	EXHIBIT A 	DEVELOPMENT AREA AND DEVELOPMENT SCHEDULE 	
	EXHIBIT
      A-1     	MAP OF
      DEVELOPMENT AREA 	
	EXHIBIT B 	FRANCHISEE INFORMATION 	
	EXHIBIT
      C 	FORM OF
      FRANCHISE AGREEMENT 	
	EXHIBIT D 	FORM OF COMMISSARY FACILITY AGREEMENT 	
	EXHIBIT
      E 	PRINCIPAL
      OWNERS’ PERSONAL GUARANTY 	
	EXHIBIT F 	INVESTOR PERSONAL COVENANTS 	  

i

KRISPY KREME DOUGHNUT CORPORATION

DEVELOPMENT AGREEMENT

     THIS
DEVELOPMENT AGREEMENT (this “Agreement”) is made and entered into as of the
Effective Date by and between Franchisor and Franchisee.

	1.		BACKGROUND 
	 
	1.1	      	Franchisor has developed, as a
      result of considerable time, skill, effort, and money, a distinctive
      system for operating stores called “Krispy Kreme Stores” that offer and
      serve a variety of doughnuts, beverages, and other authorized products and
      services under the Marks.
	 
	1.2		Franchisor’s Affiliate, HDN
      Development Corporation, owns the Marks and has granted Franchisor the
      right to sublicense the Marks to its franchisees for their use in
      operating Krispy Kreme Stores and Commissary Facilities.
	 
	1.3		Franchisor grants franchises to
      own and operate Krispy Kreme Stores and Commissary Facilities to Persons
      who meet its qualifications and are willing to undertake the investment
      and effort to properly develop and operate them.
	 
	1.4		Franchisee has submitted a
      Franchise Application to develop multiple Krispy Kreme Stores and
      Commissary Facilities in the Development Area, and Franchisor has accepted
      the application in reliance on all information Franchisee has provided in
      connection therewith.
	 
	1.5		Pursuant to the terms of this
      Agreement, Franchisor grants Franchisee the right to develop Krispy Kreme
      Stores and Commissary Facilities within the Development Area. The
      operation of each Krispy Kreme Store and Commissary Facility will be
      governed by a separate Franchise Agreement and Commissary Facility
      Agreement, respectively.
	 
	2.		DEFINITIONS
	 
	2.1		Capitalized terms used in this
      Agreement have the meanings given to them in this Section and in the Basic
      Terms.
	 
	          	Affiliate – Any person that directly or indirectly owns or
      controls, that is directly or indirectly owned or controlled by, or that
      is under common ownership or control with the referenced person, including
      parents and subsidiaries.
	 
	 		Basic Terms – The terms of this Agreement set forth on the Krispy
      Kreme Doughnut Corporation Development Agreement Basic Terms section on
      the first page hereof.
	 
	 		Commissary Facility
      – A manufacturing facility for
      doughnuts and other Products that are supplied to Hot Shops and Fresh
      Shops/Kiosks. Commissary Facilities are not used for retail sales, but may
      distribute and sell to wholesale customers subject to Franchisor’s
      authorization pursuant to the Commissary Facility Agreement.
	 
	 		Commissary Facility Agreement
      – An agreement used by Franchisor to
      grant Franchisee the right to operate a Commissary Facility at a specified
      location.
	 
	 		Competitive Business
      – A business, other than a Krispy Kreme
      Store or Commissary Facility, that: (a) makes, sells, or distributes
      yeast-raised doughnuts, cake doughnuts, or any other types of doughnuts,
      miniature doughnuts, doughnut holes or any other bakery products in any
      distribution channel to any customer for consumption or resale, and such
      sales constitute ten percent (10%) or more of its total sales (or such
      sales from any single location constitute 10% or more of the total sales
      of that location) during any calendar quarter or calendar year; (b) sells
      coffee or coffee drinks in any distribution channel to any customer for
      consumption or resale, and such sales constitute twenty percent (20%) or
      more of its total sales (or such sales from any single location constitute
      20% or more of the total sales of that location) during any calendar
      quarter or calendar year; (c) is the same as, or similar to, the Krispy
      Kreme Store

1

		
      concept as it evolves over time; or
      (d) grants franchises or licenses, or establishes joint ventures, for the
      development and/or operation of any business referred to in (a) through
      (c), above. Restrictions in this Agreement on having an Ownership Interest
      in a Competitive Business shall not apply to the ownership of shares of a
      class of securities listed on a stock exchange or traded on a public stock
      market that represents less than three percent (3%) of the number of
      shares of that class of securities issued and outstanding. 

      Confidential
      Information – Certain confidential
      information relating to the development and operation of Krispy Kreme
      Stores and Commissary Facilities, which includes:

		 		  
		(a)	      	methods, techniques, equipment,
      specifications, standards, policies, procedures, information, concepts,
      and systems relating to and knowledge of and experience in the
      development, equipping, operation, outfitting, and franchising of Krispy
      Kreme Stores and Commissary Facilities, as well as expansion, growth and
      development plans, and prospects;
		 
		(b)		marketing and advertising
      programs for Krispy Kreme Stores and Commissary Facilities;
		 
	          	(c)		knowledge concerning the logic,
      structure, and operation of computer software programs that Franchisor
      authorizes for use in connection with the operation of Krispy Kreme Stores
      and Commissary Facilities, and all additions, modifications and
      enhancements, and all data generated from use of such
  programs;
		 
		(d)		specifications and standards for,
      and sources of, buildings, equipment, furnishings, fixtures, signs,
      products, materials, supplies, and services utilized in the development
      and operation of Krispy Kreme Stores and Commissary
  Facilities;
		 
		(e)		ingredients, formulas, mixes,
      recipes for and methods of preparation, cooking, serving, packaging, and
      delivery of the Products;
		 
		(f)		information concerning sales,
      operating results, financial performance, consumer preferences, inventory
      requirements, materials and supplies, and other financial data of Krispy
      Kreme Stores and Commissary Facilities, and customer lists;
		 
		(g)		current and concluded research,
      development and test programs for products, services and operations for
      use in Krispy Kreme Stores and Commissary Facilities;
		 
		(h)		the contents of any System
      Standards Manuals, System Standards, and site selection criteria;
      and
		 
		(i)		employee training, and staffing
      levels.
		 		
		
      Development Area – The geographic area described in the Basic Terms and
      Exhibit A. Political boundaries described in the Basic Terms shall be
      considered fixed as of the Effective Date and shall not change for the
      purpose hereof, notwithstanding a political reorganization or change to
      such boundaries or regions. All street boundaries shall be deemed to end
      at the street center line unless otherwise specified above.

      Development Fee – The non-refundable development fee that Franchisee
      agrees to pay Franchisor, as set forth in the Basic Terms.

      Development Rights
      – The rights granted to Franchisee
      pursuant to this Agreement to develop Krispy Kreme Stores and Commissary
      Facilities within the Development Area.

      Development Schedule
      – The cumulative number of Krispy Kreme
      Stores and Commissary Facilities that Franchisee agrees to have open and
      in operation by the corresponding date set forth in Exhibit A.
      

      Expansion Criteria
      – Franchisor’s expansion criteria,
      which shall consist of Franchisee and its Affiliates being in compliance
      with all agreements with Franchisor or any of its Affiliates, including
      this Agreement and all Franchise Agreements and Commissary Facility
      Agreements. The Expansion Criteria include Franchisor’s assessment of
      compliance by Franchisee and its Affiliates with respect to factors such
      as monetary obligations, upgrading facilities and achieving satisfactory
      quality control levels with respects to products, services and
      cleanliness.

2

	          	
      Factory Store – A retail sales facility with the manufacturing
      capability to produce fresh doughnuts in accordance with System Standards.
      Additionally, Factory Stores may have some capacity to supply fresh
      doughnuts to Hot Shops and Fresh Shops/Kiosks.

      Franchise – The right to operate a Krispy Kreme Store or
      Commissary Facility at a specific location within the Development Area
      pursuant to an effective Franchise Agreement or Commissary Facility
      Agreement, as applicable.

      Franchise
      Agreement – An agreement used by
      Franchisor to grant the right to operate a Krispy Kreme Store at a
      specific location, the current form of which (including all exhibits,
      schedules, riders, addenda and other agreements used in connection
      therewith) is attached hereto as Exhibit C.

      Franchise Application
      – The application submitted by
      Franchisee for the rights granted hereunder or for a Franchise, as
      applicable.

      Franchise Disclosure Document
      – The franchise disclosure document
      required by applicable law. 

      Franchisee – As defined in the Basic Terms.

      Franchisor – As defined in the Basic Terms.

      Fresh Shop/Kiosk – A retail sales facility with limited manufacturing
      capabilities (e.g., icing and filling equipment), or no manufacturing
      capabilities, that receives doughnuts from a Factory Store or a Commissary
      Facility and finishes them as necessary to sell in accordance with System
      Standards. 

      Good Standing – The condition that Franchisee and its Affiliates: (a)
      are current with all payments due to Franchisor, its Affiliates and
      suppliers; (b) have met their obligations under the Development Schedule;
      and (c) are not in default of any of their obligations under this
      Agreement, any Franchise Agreement, any Commissary Facility Agreement or
      any other agreement between the parties hereto or any of their
      Affiliates.

      Hot Shop – A retail sales facility with an impinger oven and
      limited manufacturing capabilities (e.g., icing and filling
      equipment) that receives doughnuts from a Factory Store or a Commissary
      Facility and finishes them as necessary to sell in accordance with System
      Standards.

      Immediate Family – The spouse, parents, brothers, sisters and children,
      whether natural or adopted, of the referenced Person.

      Krispy Kreme
      Store(s) – Stores which Franchisor or
      any of its Affiliates own, operate or franchise and which use the Marks
      and the Krispy Kreme System. Krispy Kreme Stores include Factory Stores,
      Hot Shops and Fresh Shops/Kiosks, but do not include Commissary
      Facilities.

      Managing Director
      – The person designated as managing
      director of Franchisee’s business pursuant to Section 5.3. The
      initial Managing Director is identified in the Basic Terms.

      Marks – The current and future trademarks, service marks, logos, designs,
      trade names, and other commercial symbols, together with all distinctive
      trade dress elements, or combinations thereof, used by Franchisor to
      identify the sources of goods and services offered and sold at Krispy
      Kreme Stores, including the trademark and service mark KRISPY
      KREME®.

      Owner – Each Person (and permitted transferee of each such Person)
      holding: (a) a direct or indirect, legal or beneficial Ownership Interest
      or voting rights in Franchisee or any Affiliate of Franchisee that owns an
      Ownership Interest or voting rights in Franchisee; (b) a direct or
      indirect, legal or beneficial interest in this Agreement; or (c) any other
      legal or equitable interest, or the power to vest in himself or herself or
      itself any legal or equitable interest, in the revenue, profits, rights or
      assets of arising from any of the foregoing. 

      Ownership Interest
      – Any direct or indirect, legal or
      beneficial ownership interest of any type, including (a) in relation to a
      corporation, the ownership of shares in the corporation; (b) in relation
      to a partnership, the ownership of a general or limited partnership
      interest; (c) in relation to a limited liability company, the ownership of
      a membership interest; or (d) in relation to a trust, the ownership of a
      legal or beneficial interest of such trust.

3

	 		Person – Any individual,
      corporation, limited liability company, general or limited partnership,
      unincorporated association, cooperative or other legal or functional
      entity.
	 
	 		Principal Owner
      – An Owner with an Ownership Interest
      in Franchisee of ten percent (10%) or more.
	 
	 		Restricted Person
      – Franchisee, its Owners and
      Affiliates, and members of the Immediate Families of Franchisee (if a
      natural Person), and its Owners and Affiliates.
	 
	 		System – Those business formats, methods, procedures, signs,
      designs, layouts, equipment, and mixes designated by Franchisor from time
      to time for use in operating Krispy Kreme Stores and Commissary
      Facilities.
	 
	 		System Standards
      – The mandatory and suggested
      specifications, standards, operating procedures and rules that Franchisor
      prescribes from time to time for the operation of Krispy Kreme Stores and
      Commissary Facilities, including the standards, specifications and other
      requirements related to the purchase, preparation, marketing and sale of
      the Products; on-premises sales, Authorized Off-Premises Sales; customer
      service; the design, décor and appearance of Krispy Kreme Stores and
      Commissary Facilities; the maintenance and remodeling of Krispy Kreme
      Stores and Commissary Facilities and the equipment, fixtures and
      furnishings therein; the use and display of the Marks; the insurance
      coverage required to be carried for Krispy Kreme Stores and Commissary
      Facilities; the training of employees of Krispy Kreme Stores and
      Commissary Facilities; the days and hours of operation for Krispy Kreme
      Stores and Commissary Facilities; and the content, quality and use of
      advertising and promotional materials.
	 
	 		Term – The period of time starting on the Effective Date and
      ending on the expiration of the last date indicated on the Development
      Schedule (regardless whether all Krispy Kreme Stores and Commissary
      Facilities are open and operating at that time), unless terminated earlier
      in accordance with the provisions of this Agreement.
	 
	 		Transfer or Transfer the
      Development Rights (or similar words) –
      The direct or indirect sale, assignment, transfer, exchange, conversion,
      license, sublicense, lease, sublease, mortgage, pledge, collateral
      assignment, grant of a security, collateral or conditional interest or
      other encumbrance in or on, or other disposition, whether voluntary,
      involuntary, by operation of law or otherwise, of this Agreement, of any
      interest in or right under this Agreement, any form of legal or beneficial
      ownership interest in Franchisee, or any form of ownership interest or
      right to participate in or receive the benefits of the assets, revenues,
      income or profits of Franchisee’s business, or any one or more other acts
      or events not covered by the foregoing that Franchisor reasonably
      determines to be a form of direct or indirect transfer, including: (a) any
      transfer, redemption or issuance of a legal or beneficial ownership
      interest in the capital stock of, a membership interest in, or a
      partnership interest in, Franchisee or any interest convertible into or
      exchangeable for capital stock of, a membership interest in or a
      partnership interest in, Franchisee; (b) any merger or consolidation of
      Franchisee, whether or not Franchisee is the surviving entity, or any
      conversion of Franchisee from one form of legal entity into another form
      of legal entity, or any sale, exchange, encumbrance or other disposition
      of Franchisee’s assets; (c) any transfer in connection with or as a result
      of a divorce, dissolution of marriage or similar proceeding or a property
      settlement or legal separation agreement in the context of a divorce,
      dissolution or marriage or similar proceeding, an insolvency, bankruptcy
      or assignment for benefit of creditors, a judgment, a corporate, limited
      liability company or partnership dissolution or otherwise by operation of
      law; or (d) any transfer by gift, declaration of trust, transfer in trust,
      revocation of trust, trustee succession, trust termination, discretionary
      or mandatory trust distribution, occurrence of any event (e.g., death of a
      person) that affects or ripens the rights of contingent beneficiaries,
      exercise of a power of appointment, exercise of a withdrawal right,
      adjudication of Franchisee or any Principal Owner as legally disabled, or
      upon or after Franchisee’s death or the death of any of Franchisee’s
      Principal Owners by will, disclaimer or the laws of intestate succession
      or otherwise.
	 
	2.2	      	Other terms used in this
      Agreement are defined in the context in which they
  arise.

4

	3. 		ACKNOWLEDGMENTS,
      REPRESENTATIONS, AND WARRANTIES
	 
	3.1	      	Franchisee acknowledges that
      Franchisee has read this Agreement and Franchisor’s Franchise Disclosure
      Document and understands and accepts the terms and conditions contained in
      this Agreement as being reasonably necessary to maintain Franchisor’s high
      standards of quality and service. Franchisee further acknowledges that the
      uniformity of those standards at Krispy Kreme Stores and Commissary
      Facilities is reasonably necessary to protect and preserve the goodwill of
      the Marks. Franchisee acknowledges that Franchisee has conducted an
      independent investigation of the business venture contemplated by this
      Agreement and recognizes that, like any other business, the nature of the
      business conducted by Krispy Kreme Stores and Commissary Facilities may
      evolve and change over time, that an investment in Krispy Kreme Stores and
      Commissary Facilities involves business risks, and that Franchisee’s
      business abilities and efforts are vital to the success of the venture.
      Any information Franchisee acquires from other franchisees relating to
      their sales, profits, or cash flows does not constitute information
      obtained from Franchisor, nor does Franchisor make any representation as
      to the accuracy of any such information or the likelihood of Franchisee
      achieving comparable results. Franchisee acknowledges that, in all of its
      dealings with Franchisor, Franchisor’s officers, directors, employees and
      agents act only in a representative, and not in an individual, capacity.
      All business dealings between Franchisee and such Persons in connection
      with this Agreement are solely between Franchisee and Franchisor.
      Franchisee further acknowledges that Franchisor has advised Franchisee to
      have this Agreement reviewed and explained to Franchisee by an
      attorney.
	 
	3.2		Franchisee represents and
      warrants to Franchisor, as an inducement to Franchisor’s entry into this
      Agreement, that all statements Franchisee has made and all materials
      Franchisee has submitted to Franchisor in connection with Franchisee’s
      Franchise Application are accurate and complete and that Franchisee has
      made no misrepresentations or material omissions to obtain the rights
      granted hereunder. Franchisor has approved Franchisee’s Franchise
      Application in reliance on each of Franchisee’s representations to
      Franchisor.
	 
	3.3		Franchisee represents and
      warrants to Franchisor that Franchisee has the authority to execute and
      deliver this Agreement and to perform Franchisee’s obligations
      hereunder.
	 
	3.4		Franchisee represents and
      warrants to Franchisor that this Agreement has been duly executed and
      delivered by Franchisee and, assuming the due authorization, execution and
      delivery by Franchisor, constitutes a legal, valid and binding obligation
      of Franchisee, enforceable in accordance with its terms.
	 
	3.5		Franchisee represents and
      warrants to Franchisor that Franchisee’s execution and delivery of this
      Agreement does not, and Franchisee’s performance of its obligations under
      this Agreement will not, with or without the giving of notice or the lapse
      of time or both, (a) conflict with or violate its organizational
      documents, if applicable, (b) conflict with or violate any law, statute,
      ordinance, rule, regulation, order, judgment or decree applicable to
      Franchisee, or (c) conflict with, result in any breach of, or constitute a
      default under, any contract, agreement, lease, license, permit, franchise
      or other instrument or obligation to which Franchisee is a party or by
      which Franchisee is bound.
	 
	3.6		If Franchisee is, or at any time
      becomes, a business corporation, partnership, limited liability company,
      or other legal entity, Franchisee and each of its Principal Owners
      represents, warrants and agrees that: (a) Franchisee is duly organized and
      validly existing under the laws of the state of its organization, and, if
      a foreign business corporation, partnership, limited liability company or
      other legal entity, Franchisee is duly qualified to transact business in
      the state in which the Development Area is located; (b) Franchisee has the
      authority to execute and deliver this Agreement and to perform its
      obligations hereunder; (c) true and complete copies of the articles of
      incorporation, articles of organization, operating agreement or
      principles, partnership agreement, bylaws, subscription agreements,
      buy-sell agreements, voting trust agreements, trust agreements and all
      other documents relating to Franchisee’s ownership, organization,
      capitalization, management and control (“Organizational Documents”) shall
      be promptly delivered to Franchisor for its approval, which approval shall
      not be unreasonably withheld; (d) any and all amendments, deletions and
      additions to Franchisee’s Organizational Documents shall be promptly
      delivered to Franchisor for its approval, which approval shall not be
      unreasonably withheld; (e) Franchisee’s activities are
  restricted

5

	 		to those necessary solely for the
      development, ownership and operation of Krispy Kreme Stores and Commissary
      Facilities in accordance with this Agreement and in accordance with any
      other agreements entered into with Franchisor or any of its Affiliates;
      (f) the Organizational Documents recite that the issuance, transfer or
      pledge of any direct or indirect legal or beneficial ownership interest is
      restricted by the terms of this Agreement; (g) all certificates
      representing direct or indirect legal or beneficial ownership interests
      now or hereafter issued must bear a legend in conformity with applicable
      law reciting or referring to such restrictions; and (h) Franchisee will
      deliver to Franchisor a Secretary/Clerk’s/Trustee’s Certificate or other
      evidence satisfactory to Franchisor that the execution, delivery and
      performance of this Agreement and all other agreements and ancillary
      documents contemplated hereby or thereby have been duly authorized by all
      necessary action by the corporation, partnership, limited liability
      company or other legal entity, as applicable, and are within the legal
      powers of Franchisee’s trustee, if Franchisee is a trust.
	 
	3.7		Franchisee and each of its
      Principal Owners represent, warrant, and agree that Exhibit B is
      current, complete and accurate. Franchisee agrees that an updated
      Exhibit B will be furnished promptly to Franchisor, so that
      Exhibit B (as so revised and signed by Franchisee) is at all times
      current, complete and accurate. Each person who is or becomes a Principal
      Owner must execute an agreement in the form Franchisor prescribes,
      undertaking to guarantee and be bound jointly and severally by the terms
      of this Agreement, the current form of which is attached hereto as
      Exhibit E. Each person who is or becomes an Owner, whether or not a
      Principal Owner, must execute an agreement in the form Franchisor
      prescribes, undertaking to be bound by the confidentiality and
      non-competition covenants contained in this Agreement, the current form of
      which is attached hereto as Exhibit F. Each Owner must be an
      individual acting in his/her individual capacity, unless Franchisor waives
      this requirement.
	 
	3.8		The provisions of Section
      3 constitute continuing representations and warranties, and Franchisee
      and Franchisee’s Principal Owners shall notify Franchisor immediately in
      writing of the occurrence of any event or the development of any
      circumstance that might render any of the foregoing representations and
      warranties false, inaccurate, or misleading.
	 
	4.
      		TERM/ FEES /DEVELOPMENT
      SCHEDULE
	 
	4.1		Franchisor grants Franchisee the
      right to develop (as long as Franchisee remains in Good Standing and meets
      the Expansion Criteria), and Franchisee accepts the obligation to develop,
      Krispy Kreme Stores and Commissary Facilities in the Development Area
      during the Term subject to and in compliance with the terms of this
      Agreement, including the Development Schedule. 
	 
	4.2		Franchisor’s obligation to grant
      Franchises to Franchisee to operate Krispy Kreme Stores and Commissary
      Facilities in the Development Area will expire upon the expiration of the
      Term. Franchisee has no right to renew or extend the rights granted under
      this Agreement. However, if Franchisee has been in Good Standing and has
      met the Expansion Criteria during the Term, Franchisor may, but is not
      obligated to, offer Franchisee further development rights on such terms
      and conditions as Franchisor deems appropriate. Upon expiration,
      Franchisor has the right to develop and operate, and to allow others to
      develop and operate, Krispy Kreme Stores and Commissary Facilities in the
      Development Area, unless further development rights are granted to
      Franchisee, as above provided.
	 
	4.3	      	Franchisee agrees that during the
      Term, it will strictly and diligently perform its obligations hereunder
      and will continuously exert its best efforts to promote and enhance the
      development and operation of Krispy Kreme Stores and Commissary Facilities
      within the Development Area. Without limiting the foregoing obligations,
      Franchisee agrees to meet the Development Schedule. Time is of the essence
      in this Agreement. Franchisee’s failure to develop and operate Krispy
      Kreme Stores and Commissary Facilities in accordance with the Development
      Schedule is a material breach of this Agreement for which Franchisor has
      the right to exercise any and all rights and remedies conferred under this
      Agreement and applicable law, including the right to terminate this
      Agreement pursuant to Section 10 without prejudice to its recovery
      of damages.
	 
	4.4		Notwithstanding anything to the
      contrary in this Agreement, Franchisee shall not be deemed to be in breach
      of this Agreement if its failure to meet the Development Schedule results
      solely from windstorms, rains, floods, earthquakes, mudslides, fires or
      other natural disasters. Any delay resulting from any of
  such

6

	 		causes shall extend
      performance accordingly, in whole or in part, as may be reasonable, except
      that no such cause, alone or in combination with other causes, shall
      extend performance more than ninety (90) days without Franchisor’s prior
      written consent.
	 
	4.5		Franchisee will pay to
      Franchisor the Development Fee as set forth in the Basic Terms. The
      Development Fee will be fully earned, non-refundable (except as otherwise
      provided in Section 10.2), and payable to Franchisor upon execution
      of this Agreement; provided however, the Development Fee may be creditable
      on a dollar-for-dollar basis against Initial Franchise Fees, if provided
      in the Basic Terms.
	 
	4.6		For each Franchise
      granted to Franchisee pursuant to this Agreement, the Initial Franchise
      Fee (defined in the Franchise Agreement) will be as set forth in the Basic
      Terms and will be subject to a credit in the amount of the portion of the
      Development Fee attributable to the Store. The Development Fee will be
      attributed only to the Stores for which it is paid and may not be used as
      a credit for any other Stores. For each Franchise granted to Franchisee
      pursuant to this Agreement, the Royalties (defined in the Franchise
      Agreement and the Commissary Facility Agreement) and other fees will be as
      set forth in the Franchise Agreement and the Commissary Facility
      Agreement.
	 
	5.
      		BUSINESS PLANS
      AND MANAGEMENT 
	 
	5.1		Prior to execution of
      this Agreement, and on an annual basis thereafter, Franchisee will submit
      for review and approval by Franchisor, a written business plan for the
      development and financing of Krispy Kreme Stores and Commissary Facilities
      in the Development Area in accordance with the Development
    Schedule.
	 
	5.2		Franchisee must secure
      and maintain in force in its name all required licenses, permits, and
      certificates relating to the conduct of its business pursuant to this
      Agreement. Franchisee will at all times remain in Good Standing.
      Franchisee shall comply with all applicable laws, including all federal,
      state and local laws, rules, regulations, ordinances, court orders and
      decrees. Franchisee shall refrain from any business practice that
      Franchisor determines in its sole discretion may be injurious to the
      business or reputation of Franchisor or Franchisee or the goodwill
      associated with the Marks.
	 
	5.3	      	At all times during the
      Term, Franchisee will designate a Managing Director of its business
      pursuant to this Agreement who shall complete Franchisor’s mandatory
      training program to Franchisor’s satisfaction. The initial Managing
      Director is identified in the Basic Terms. The Managing Director will use
      his or her full-time efforts to fulfill Franchisee’s obligations under
      this Agreement and under Franchise Agreements and any Commissary Facility
      Agreements, and will not directly or indirectly engage in any other
      business or activity that requires any significant management
      responsibility or time commitments, or that otherwise conflicts with
      Franchisee’s obligations under this Agreement. If the Managing Director is
      terminated in that role, or if the Managing Director does not carry out
      his or her responsibilities or otherwise perform in accordance with this
      Agreement, Franchisee will promptly designate a replacement, and each such
      replacement shall complete Franchisor’s mandatory training program to
      Franchisor’s satisfaction.
	 
	6.
      		GRANT OF
      FRANCHISES 
	 
	6.1		Franchisor will furnish
      Franchisee with its standard site selection criteria, and provide site
      selection assistance for Krispy Kreme Stores and Commissary Facilities, in
      accordance with System Standards. Franchisor also will provide such
      on-site evaluation of sites proposed pursuant hereto as Franchisor deems
      necessary or appropriate.
	 
	6.2		Subject to the terms
      and conditions of Section 4.1, Franchisor will grant Franchises for
      the cumulative number and type of Krispy Kreme Stores and Commissary
      Facilities set forth in the Development Schedule located within the
      Development Area in accordance with the following provisions:
	 
	 		(a)	      	Franchisee must submit to
      Franchisor, in accordance with Franchisor’s procedures, a complete site
      information package (the “Site Information Package”), as Franchisor may
      require from time to time, for each site for a Krispy Kreme Store or
      Commissary Facility that Franchisee proposes to develop and operate and
      that Franchisee, in good faith, believes to conform to Franchisor’s
      then-current standard site selection criteria for Krispy Kreme Stores and
      Commissary Facilities;

7

	 		(b)	      	Franchisor will accept or reject
      each site for which Franchisee submits a complete Site Information Package
      in accordance with Section 6.2(a) and, if Franchisor accepts the
      site, Franchisor will do so by delivering its standard site acceptance
      letter. The site acceptance letter, duly executed by Franchisor, is the
      exclusive means by which Franchisor accepts a proposed site, and no other
      direct or indirect representation, approval or acceptance, whether in
      writing or orally, by any of Franchisor’s officers, employees or agents,
      shall be effective or bind Franchisor. Franchisor will use all reasonable
      efforts to make a site acceptance decision and, if the site is accepted,
      deliver a site acceptance letter to Franchisee within thirty (30) days
      after Franchisor receives the complete Site Information Package and any
      other materials Franchisor has requested.
	 
	 		 		In deciding whether to accept or
      reject a site Franchisee proposes, Franchisor may consider such factors as
      Franchisor, in its sole discretion, deems appropriate, including the
      general location and neighborhood, demographic information, traffic
      patterns, access, visibility, location of other retail food establishments
      (including other Krispy Kreme Stores and Commissary Facilities) and size,
      condition, configuration, appearance, and other physical characteristics
      of the site.
	 
	 		 		Neither Franchisor’s acceptance
      of a proposed site, nor any information communicated to Franchisee
      regarding Franchisor’s standard site selection criteria or the proposed
      site, constitutes a warranty or representation of any kind, express or
      implied, as to the suitability of the proposed site for a Krispy Kreme
      Store, a Commissary Facility or for any other purpose. Franchisor’s
      acceptance of a proposed site merely signifies that Franchisor is willing
      to grant a Franchise for a Krispy Kreme Store or Commissary Facility at
      that location in accordance with the terms of this Agreement. Franchisee’s
      decision to develop and operate a Krispy Kreme Store or Commissary
      Facility at any site is based solely on its own independent investigation
      of the suitability of the site for a Krispy Kreme Store or Commissary
      Facility, as applicable.
	 
	6.3	      	In conjunction with its
      decision whether to accept or reject a proposed site, Franchisor may
      require that Franchisee and its Principal Owners furnish Franchisor with
      financial statements (historical and pro forma), statements of the sources
      and uses of capital funds, budgets and other information regarding
      Franchisee, its Principal Owners and each legal entity, if any, involved
      in the development, ownership and operation of any Krispy Kreme Store or
      Commissary Facility that Franchisee proposes, as well as any then-existing
      Krispy Kreme Stores or Commissary Facilities that Franchisee or its
      Affiliates own. All such information shall be verified by Franchisee and
      its Principal Owners as being complete and accurate in all respects, shall
      be submitted to Franchisor in accordance with its requirements and will be
      relied on by Franchisor in determining whether to grant a Franchise for
      the proposed Krispy Kreme Store or Commissary Facility. Franchisor may
      refuse to grant Franchisee a Franchise for a Krispy Kreme Store or
      Commissary Facility if Franchisee fails to demonstrate sufficient
      financial and management capabilities to properly develop and operate the
      proposed Krispy Kreme Store or Commissary Facility and the then-existing
      Krispy Kreme Stores and Commissary Facilities that Franchisee and its
      Affiliates own. Franchisor will evaluate such financial and management
      capabilities in accordance with the then-current standards Franchisor uses
      to establish Krispy Kreme Stores or Commissary Facilities in other
      comparable market areas.
	 
	6.4		If Franchisor accepts a
      proposed site pursuant to Section 6.2, and Franchisee demonstrates
      the requisite financial and management capabilities (if requested by
      Franchisor) pursuant to Section 6.3, then Franchisor agrees to
      offer Franchisee a Franchise to operate a Krispy Kreme Store or Commissary
      Facility at the proposed site by delivering to Franchisee the Franchise
      Agreement or Commissary Facility Agreement for the state in which the
      Krispy Kreme Store or Commissary Facility is to be located. The Franchise
      Agreement or Commissary Facility Agreement must be executed by Franchisee
      and its Owners (as applicable) and returned to Franchisor no later than
      fourteen (14) days after Franchisor delivers them to Franchisee. If
      Franchisor does not receive the fully executed Franchise Agreement or
      Commissary Facility Agreement and payment of the Initial Franchise Fee as
      required hereunder, Franchisor may revoke its offer to grant Franchisee a
      Franchise to operate a Krispy Kreme Store or Commissary Facility at the
      proposed site and may revoke its acceptance of the proposed
  site.

8

	7. 		FRANCHISOR’S RIGHTS
      AND LIMITATIONS/EXCLUSIVITY 
	 
	7.1		Provided that
      Franchisee is in Good Standing, neither Franchisor nor its Affiliates
      will, during the Term, own or operate, or grant Franchises for the
      ownership or operation of, Krispy Kreme Stores or Commissary Facilities
      located in the Development Area, except for: (a) Franchises granted
      pursuant to this Agreement; (b) any Krispy Kreme Stores and Commissary
      Facilities open (or under commitment to open) as of the date hereof; (c)
      any food service establishment using any part or all of the System and/or
      Marks at special locations within the Development Area, such as college
      campuses, hospitals, public transportation facilities (e.g. airport
      facilities or highway rest stops), government (e.g. military bases) or
      institutional locations, supermarkets, convenience stores or grocery
      stores, and department stores, as well as mobile units located temporarily
      at special events, such as sports or entertainment events; and (d) food
      service establishments that Franchisor purchases (or as to which
      Franchisor purchases the rights as franchisor) that are part of another
      franchise system or chain, regardless whether such food services
      establishments are converted to operate using any of the Marks and/or any
      or all of the System or whether such food service establishments operate
      under other trademarks, service marks, or trade dress and/or use other
      operating systems.
	 
	7.2		Franchisor and its
      Affiliates (and their respective successors and assigns, by purchase,
      merger, consolidation or otherwise) retain all rights not expressly
      granted to Franchisee in Section 7.1, including those with respect
      to Krispy Kreme Stores, Commissary Facilities, the Marks, and the sale of
      Products. Franchisee waives, to the fullest extent permitted under
      applicable law, all claims, demands or causes of action arising from or
      related to any of such activities by Franchisor, its Affiliates, or their
      respective successors and assigns.
	 
	7.3		Except as provided in
      Section 7.1, no exclusive territory or protection is expressly or
      impliedly granted to Franchisee under this Agreement, and Franchisor
      reserves the right to operate and to grant others the right to operate
      Krispy Kreme Stores and Commissary Facilities at any location on such
      terms and conditions as it deems appropriate.
	 
	7.4		Franchisor reserves the
      right to acquire, develop, and operate, or be acquired by, any company,
      including a company operating one or more food
      service businesses (including food service businesses selling doughnuts or
      coffee).
	 
	7.5	      	Franchisor reserves the
      right to license, sample, sell, or market by any means whatsoever
      (including the Internet) the Products and any goods or services identified
      by the Marks. Such goods and services may be licensed, sampled, sold, or
      marketed in any and all locations and venues (including within the
      Development Area), and through any method or channel of distribution
      Franchisor deems appropriate in its sole discretion (including wholesale
      distribution of Products to supermarkets, grocery stores, convenience
      stores, and other retail outlets located within or outside the Development
      Area).
	 
	7.6		Franchisee acknowledges
      and agrees that Franchisor would be unable to (a) protect the Confidential
      Information against unauthorized use or disclosure; (b) preserve the
      prestige, integrity, and goodwill of the Products, Marks, and System; or
      (c) encourage the free exchange of ideas and information among Krispy
      Kreme Stores and Commissary Facilities if franchisees and owners of Krispy
      Kreme Stores or Commissary Facilities or their owners were permitted to
      engage in or benefit from certain competitive activities. Franchisee also
      acknowledges that Franchisor has granted the franchise rights to
      Franchisee in consideration of and reliance on Franchisee’s agreement that
      Franchisee and its Owners will deal exclusively with Franchisor.
      Therefore, except as expressly authorized by this Agreement or another
      written agreement with Franchisor, Franchisee agrees that during the Term,
      without Franchisor’s prior written consent, neither Franchisee nor any
      Restricted Person will:
	 
	 		(i)		have any Ownership Interest in a Competitive
      Business;
	 
	 		(ii)		perform services as a director,
      officer, manager, partner, or supervisory or management-level employee, of
      any Competitive Business;
	 
	 		(iii)	      	perform services as an employee, consultant,
      representative, agent or otherwise for a Competitive Business, where such
      services (A) are substantially similar to those provided to Franchisor or
      Franchisor’s Affiliates by Franchisee or the respective Restricted Person
      or (B) create a relationship

9

	 				between Franchisee or the Restricted Person
      and such Competitive Business in which Franchisee or the Restricted Person
      could be reasonably expected to materially benefit, either directly or
      indirectly, whether financially or otherwise, from the disclosure of any
      Confidential Information to such Competitive Business;
	 
	 		(iv)	      	recruit or hire any Person who is
      Franchisor’s employee or the employee of any Krispy Kreme Store or
      Commissary Facility or who has been Franchisor’s employee or the employee
      of any Krispy Kreme Store or Commissary Facility within the past six (6)
      months without obtaining prior written permission from Franchisor and that
      Person’s employer. If Franchisor permits Franchisee to hire any such
      Person, then Franchisee agrees to pay Franchisor a non-refundable
      Management Development Fee in the amount of Twenty-Five Thousand Dollars
      ($25,000) per hired employee as of the date of hire; or
	 
	 		(v)		induce or attempt to induce any
      Person who is Franchisor’s employee or the employee of any Krispy Kreme
      Store or Commissary Facility to discontinue working for Franchisor or such
      Krispy Kreme Store or Commissary Facility, as the case may
be.
	 
	8.
      		MARKS / COPYRIGHTS /
      CONFIDENTIAL INFORMATION 
	 
	8.1	      	Notwithstanding any
      provision to the contrary contained herein, it is understood and agreed
      that this Agreement does not grant Franchisee any right to use the Marks.
      Further, it is understood and agreed that this Agreement does not grant
      Franchisee, and Franchisee does not have, any right to any copyrighted
      work or patent which Franchisor now owns or may hereinafter own. Rights to
      the Marks, copyrighted works and/ or patents are granted only under the
      Franchise Agreements to be executed by Franchisor and
  Franchisee.
	 
	8.2		Franchisor will
      disclose parts of its Confidential Information to Franchisee solely for
      its use in connection with this Agreement. The Confidential Information is
      proprietary and includes Franchisor’s trade secrets. During the Term and
      thereafter: (a) Franchisee and its Owners may not use the Confidential
      Information in any other business or capacity (Franchisee acknowledges
      such use is an unfair method of competition); (b) Franchisee and its
      Owners must maintain the confidentiality of the Confidential Information;
      (c) Franchisee and its Owners may not make unauthorized copies of any
      portion of the Confidential Information disclosed in written, electronic
      or other form; and (d) Franchisee and its Owners must implement all
      reasonable procedures Franchisor prescribes from time to time to prevent
      unauthorized use or disclosure of the Confidential Information, including
      the use of nondisclosure agreements with Franchisee’s Owners, officers,
      directors, Managing Director, managers, and assistant managers, and
      Franchisee and its Owners must deliver such agreements to
      Franchisor.
	 
	 		Without limiting the
      foregoing, Franchisee, and each of its Owners, as applicable, each (a)
      acknowledges possibly gaining access to Franchisor’s material non-public
      information and that of Franchisor’s parent company, Krispy Kreme
      Doughnuts, Inc. (“KKDI”), and that the securities laws prohibit trading in
      KKDI securities while in possession of such information, and (b) agrees to
      refrain from trading in KKDI securities in violation of such
    laws.
	 
	 		At the end of the Term,
      Franchisee and its Owners must deliver to Franchisor all such Confidential
      Information, except for such information as Franchisee is permitted to
      retain pursuant to Franchise Agreements then in effect. Franchisee’s
      restrictions on disclosure and use of Confidential Information do not
      apply to information or techniques which are or become generally known in
      the restaurant industry (other than through Franchisee’s own disclosure),
      provided Franchisee obtains Franchisor’s prior written consent to such
      disclosure or use.
	 
	9.		TRANSFERS
    
	 
	9.1		This Agreement is fully
      transferable by Franchisor (without any obligation to provide notice to
      Franchisee or obtain Franchisee’s consent) and will inure to the benefit
      of any assignee or other legal successor to Franchisor’s interests.
      Franchisee agrees that Franchisor will have the right, from time to time,
      to delegate the performance of any portion of or all of its obligations
      and duties under this Agreement to designees, whether the same are
      Franchisor’s agents or independent contractors with which Franchisor has
      contracted to provide these services.

10

	9.2	      	Franchisee’s rights and
      duties under this Agreement are personal to Franchisee, or if Franchisee
      is a business corporation,
      partnership, limited liability company or any other legal entity, its
      Owners. Accordingly, neither Franchisee nor any of its Owners may Transfer
      the Development Rights without Franchisor’s prior approval and without
      complying with the terms and conditions of Section 9. Any such
      Transfer without such approval or compliance constitutes a breach of this
      Agreement, and is void and of no force or effect. Notwithstanding the
      foregoing, Franchisee may not under any circumstances directly or
      indirectly subfranchise or sublicense any of its rights
      hereunder.
	  
	9.3		If Franchisor has not
      exercised its right of first refusal under Section 9.5, Franchisor
      will not unreasonably withhold its approval of a Transfer of the
      Development Rights that meets all of the reasonable restrictions,
      requirements and conditions Franchisor imposes on the Transfer, the
      transferor(s) and/or the transferee(s) from time to time, which shall in
      any event include the following:
	 
	 		(a) 	      	Franchisee must be in Good Standing;
    
	 
	 		(b)		the proposed transferee and its owners (if
      the proposed transferee is a corporation, partnership, limited liability
      company or other legal entity) must provide Franchisor on a timely basis
      all information Franchisor requests, and must be individuals acting in
      their individual capacities who are of good character and reputation, who
      must have sufficient business experience, aptitude and financial resources
      to develop Franchises pursuant to this Agreement, and who must otherwise
      meet Franchisor’s then-current standards for approval;
	 
	 		(c)		the proposed transferee may not be an
      entity, or be affiliated with an entity, that is required to comply with
      the reporting and information requirements of the Securities Exchange Act
      of 1934, as amended;
	 
	 		(d) 		the transferee and its owners must agree to
      be bound by all of the provisions of this Agreement for the remainder of
      the Term;
	 
	 		(e)		the transferee must acquire, in a concurrent
      transaction, all of the rights and obligations of Franchisee and its
      Affiliates under all agreements between Franchisee or its Affiliates and
      Franchisor or its Affiliates, including all Franchise Agreements and
      Commissary Facility Agreements executed by Franchisee or its Affiliates
      pursuant to this Agreement or pursuant to any other development or similar
      agreement with Franchisor;
	 
	 		(f)		Franchisee or the transferee must pay
      Franchisor a transfer fee in an amount equal to Five Thousand Dollars
      ($5,000.00), plus Five Thousand Dollars ($5,000.00) for each Franchise for
      which a Franchise Agreement or Commissary Facility Agreement has been
      executed pursuant hereto (as required under the terms of such agreements),
      plus any transfer fee required by any other agreement between Franchisee
      or its Affiliates and Franchisor or its Affiliates;
	 
	 		(g)		Franchisee and its Owners and Affiliates
      must, except to the extent limited or prohibited by applicable law,
      execute a general release, in form and substance satisfactory to
      Franchisor, of any and all claims against Franchisor, its Affiliates and
      shareholders, members, managers, officers, directors, employees, agents,
      successors and assigns;
	 
	 		(h)		Franchisee must provide Franchisor with all
      information requested by Franchisor in connection with the Transfer, and
      Franchisor must not have disapproved the material terms and conditions of
      such Transfer (including the price and terms of payment and the amount to
      be financed by the transferee in connection with such Transfer) on the
      basis that they are so burdensome as to be likely, in Franchisor’s
      reasonable judgment, to adversely affect the transferee’s operation of
      Krispy Kreme Stores and Commissary Facilities or its compliance with this
      Agreement, all Franchise Agreements and Commissary Facility Agreements
      being transferred, and any other agreements to be executed by the
      transferee;
	 
	 		(i)		if Franchisee (or any of its Owners or
      Affiliates) finances any part of the sale price of the transferred
      interest, Franchisee and/or its Owners or Affiliates must agree that all
      obligations of the transferee, and security interests reserved by any of
      them in the assets transferred, will be subordinate
to

11

	 		 	the transferee’s obligations to
      pay all amounts due Franchisor and its Affiliates and to otherwise comply
      with this Agreement, all Franchise Agreements and Commissary Facility
      Agreements being transferred, and any other agreements to be executed by
      the transferee;
	 
	 		(j)	      	Franchisee and its Owners must execute
      noncompetition and non-solicitation covenants, in form and substance
      satisfactory to Franchisor, substantially similar to those contained in
      Section 11.2 hereof; and
	 
	 		(k) 	 	Franchisee and its Owners and Affiliates
      must execute such other documents and do such other things as Franchisor
      reasonably requires to protect its rights under this Agreement and all
      Franchise Agreements, Commissary Facility Agreements and other agreements
      being transferred.
	 
	9.4	      	Franchisor’s approval
      of a Transfer of the Development Rights does not constitute: (a) a
      representation as to the fairness of the terms of any agreement or
      arrangement between Franchisee or its Owners and the transferee or as to
      the prospects for success by the transferee; or (b) a release of
      Franchisee and its Owners, a waiver of any claims against Franchisee or its Owners or a waiver
      of Franchisor’s right to demand the transferee’s compliance with this
      Agreement or any other agreements being transferred. Any approval shall
      apply only to the specific Transfer of the Development Rights being
      proposed and shall not constitute Franchisor’s approval of, or have any
      bearing on, any other proposed Transfer of the Development
      Rights.
	  
	9.5		If Franchisee or any of
      its Owners desires to Transfer the Development Rights (other than by gift
      or bequest), Franchisee or such Owner(s) must obtain a bona fide, executed
      written offer from a responsible and fully disclosed purchaser (which must
      contain a confidentiality covenant by Franchisee and the prospective buyer
      to which Franchisor shall be an intended third party beneficiary) and must
      deliver immediately to Franchisor a complete and accurate copy of such
      offer. If the offeror proposes to buy any other property or rights from
      Franchisee or any of its Owners or Affiliates (other than rights under any
      Development Agreement, Franchise Agreement, or Commissary Facility
      Agreement for Krispy Kreme Stores) as part of the bona fide offer, the
      proposal for such property or rights must be set forth in a separate,
      contemporaneous offer that is fully disclosed to Franchisor, and the price
      and terms of purchase offered to Franchisee or its Owners for the Transfer
      of the Development Rights must reflect the bona fide price offered therefor
      and not reflect any value for any other property or rights.
	 
	9.6		Franchisor has the
      option, exercisable by notice delivered to Franchisee or its Owners within
      thirty (30) days from the date of delivery of a complete and accurate copy
      of such offer to Franchisor, to purchase such interest for the price and
      on the terms and conditions contained in such offer, provided that: (a)
      Franchisor may substitute cash for any form of payment proposed in such
      offer; (b) Franchisor’s credit shall be deemed at least equal to the
      credit of any proposed purchaser; (c) Franchisor shall have not less than
      ninety (90) days from the option exercise date to consummate the
      transaction; and (d) Franchisor shall not be required to pay deposits
      (such as earnest money) or to escrow funds prior to closing. Franchisor
      has the right to investigate and analyze the business, assets and
      liabilities and all other matters Franchisor deems necessary or desirable
      in order to make an informed investment decision with respect to the
      fairness of the terms of the right of first refusal. Franchisor may
      conduct such investigation and analysis in any manner Franchisor deems
      reasonably appropriate, and Franchisee and its Owners must cooperate fully
      with Franchisor in connection therewith.
	 
	9.7		If Franchisor exercises
      its option to purchase, Franchisor is entitled to purchase such interest
      subject to all representations and warranties, closing documents,
      releases, non-competition covenants and indemnities as Franchisor
      reasonably may require, provided if Franchisor exercises its option as a
      result of a written offer reflected in a fully negotiated definitive
      agreement with the proposed purchaser, Franchisor will not be entitled to
      any additional representations, warranties, closing documents, or
      indemnities that will have a materially adverse effect on Franchisee’s
      rights and obligations under the definitive agreement.
	 
	 		If Franchisor does not
      exercise its option to purchase, Franchisee or its Owners may complete the
      sale to such offeror pursuant to and on the exact terms of such offer,
      subject to Franchisor’s approval of the Transfer as provided in
      Sections 9.2 and 9.3, provided that if the sale to such
      offeror is not completed within ninety (90) days after delivery of such
      offer to Franchisor, or if there is a change in the terms of the offer,
      Franchisee must promptly notify Franchisor and Franchisor shall have an
      additional option to

12

	 		purchase (on the terms
      of the revised offer, if any, and otherwise as set forth herein) during
      the thirty (30) day period following Franchisee’s notification of the
      expiration of the ninety (90) day period or the material change to the
      terms of the offer.
	 
	9.8		Neither Franchisee nor
      any of its Owners or Affiliates may issue or sell, or offer to issue or
      sell, any of Franchisee’s securities or any securities of any of its
      Affiliates, regardless of whether such sale or offer would be required to
      be registered pursuant to the provisions of the Securities Act of 1933, as
      amended, or the securities laws of any other jurisdiction and regardless
      of the means by which such sale is conducted, directly or indirectly, or
      by operation of law (including by merger, consolidation, reorganization or
      otherwise) without obtaining Franchisor’s prior consent and complying with
      all of its requirements and restrictions concerning use of information
      about Franchisor and its Affiliates. Neither Franchisee nor any of its
      Owners or Affiliates may issue or sell Franchisee’s securities or the
      securities of any of its Affiliates if: (a) such securities would be
      required to be registered pursuant to the Securities Act of 1933, as
      amended, or such securities would be owned by more than 35 persons; or (b)
      after such issuance or sale, Franchisee or such Affiliate would be
      required to comply with the reporting and information requirements of the
      Securities Exchange Act of 1934, as amended. Any memorandum or other
      communications circulated in connection with any solicitation of offers to
      purchase that would require Franchisor’s consent to Transfer the
      Development Rights (through whatever form of transaction, whether through
      direct or indirect sale of assets or securities, by operation of law or
      otherwise) shall be subject to approval by Franchisor.
	 
	10. 		TERMINATION OF
      DEVELOPMENT RIGHTS 
	 
	10.1	      	Franchisee is in
      material breach of this Agreement, and this Agreement will automatically
      terminate without notice, at Franchisor’s discretion, if: (a) Franchisee
      becomes insolvent by reason of its inability to pay its debts as they
      mature; (b) Franchisee is adjudicated bankrupt or insolvent; (c)
      Franchisee files a petition in
      bankruptcy, reorganization or similar proceeding under the bankruptcy laws
      of the United States or has such a petition filed against Franchisee,
      which is not discharged within thirty (30) days; (d) a receiver or other
      custodian, permanent or temporary, is appointed for Franchisee’s business,
      assets or property; (e) Franchisee requests the appointment of a receiver
      or makes a general assignment for the benefit of creditors; (f) a final
      judgment against Franchisee in the amount of Fifty Thousand Dollars
      ($50,000.00) or more remains unsatisfied of record for sixty (60) days or
      longer; (g) Franchisee’s bank accounts, property or accounts receivable
      are attached; (h) execution is levied against Franchisee’s business or
      property; (i) suit is filed to foreclose any lien or mortgage against any
      of Franchisee’s assets and such suit is not dismissed within thirty (30)
      days; or (j) Franchisee voluntarily dissolves or liquidates or has a
      petition filed for corporate or partnership dissolution and such petition
      is not dismissed within thirty (30) days; or (k) Franchisee’s assets,
      property or interest are “blocked” under any law, ordinance or regulation
      relating to terrorist activities or if Franchisee is otherwise in
      violation of any such law, ordinance or regulation.
	 
	10.2		In addition to
      Franchisor’s right to terminate pursuant to other provisions of this
      Agreement or under applicable law, Franchisor may terminate this
      Agreement, effective upon delivery of notice of termination to Franchisee,
      if Franchisee or any of its Principal Owners or Affiliates:
	 
	 		(a) 	      	fails to meet any part of the Development
      Schedule;
	 
	 		(b) 		makes an unauthorized Transfer of the
      Development Rights;
	 
	 		(c)		makes any material misstatement or omission
      in any Franchise Application or in any other information, report, or
      summary provided to Franchisor at any time;
	 
	 		(d)		is convicted of, or plead no contest to, a
      felony or other crime or offense that Franchisor believes, in its sole
      judgment, may adversely affect the System or the goodwill associated with
      the Marks;
	 
	 		(e)		makes any unauthorized use or disclosure of
      the Confidential Information;
	 
	 		(f)		fails to comply with any other provision of
      this Agreement and does not correct such failure within thirty (30) days
      after written notice of such failure to comply is delivered to
      Franchisee;

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	 		(g)		is in breach of any Franchise
      Agreement or Commissary Facility Agreement such that Franchisor has the
      right to terminate such agreement, whether or not Franchisor elects to
      exercise its right to do so;
	 
	 		(h)	      	is in breach of any other
      agreement between Franchisee or any of its Affiliates and Franchisor or
      any of its Affiliates such that Franchisor has a right to terminate such
      agreement, whether or not Franchisor elects to exercise its right to do
      so; or
	 
	 		(i)		if Franchisor determines that any
      applicable federal or state statute, regulation, rule or law, which is
      enacted, promulgated or amended after the date hereof, may have a material
      adverse effect on its rights, remedies or discretion in franchising Krispy
      Kreme Stores or Commissary Facilities.
	 		 		 
			Franchisor has no obligation
      whatsoever to refund any portion of the Development Fee upon any
      termination, except that Franchisor will refund a pro rata portion of the
      Development Fee in the event of a termination solely pursuant to
      Section 10.2(i).
			 
	11.		EFFECT OF
      TERMINATION AND EXPIRATION
	 
	11.1		All obligations under
      this Agreement, which expressly or by their nature survive the expiration
      or termination of this Agreement, shall continue in full force and effect
      until they are satisfied in full or by their nature expire.
	 
	11.2	      	Upon termination or
      expiration of this Agreement, neither Franchisee nor any Restricted Person
      will, for a period of two (2) years, starting on the effective date of
      termination or expiration:
	 
	 		(a)		have any Ownership Interest in a
      Competitive Business operating within the Development Area or within a
      radius of ten (10) miles of any Krispy Kreme Store or Commissary Facility
      in operation or under construction on the effective date of termination or
      expiration;
	 
	 		(b)		perform services as a director,
      officer, manager, partner, or supervisory or management-level employee, of
      any Competitive Business operating within the Development Area or within a
      radius of ten (10) miles of any Krispy Kreme Store or Commissary Facility
      in operation or under construction on the effective date of termination or
      expiration;
	 
	 		(c)		perform services as an employee,
      consultant, representative, agent or otherwise for a Competitive Business
      operating within the Development Area or within a radius of ten (10) miles
      of any Krispy Kreme Store or Commissary Facility in operation or under
      construction on the effective date of termination or expiration, where
      such services: (i) are substantially similar to those provided to
      Franchisee; or (ii) create a relationship between Franchisee or the
      Restricted Person and such Competitive Business in which Franchisee or the
      Restricted Person could be reasonably expected to materially benefit,
      either directly or indirectly, whether financially or otherwise, from the
      disclosure of any Confidential Information to such Competitive
      Business;
	 
	 		(d)		recruit or hire any Person who is
      Franchisor’s employee or the employee of any Krispy Kreme Store or who has
      been Franchisor’s employee or the employee of any Krispy Kreme Store or
      Commissary Facility within the past six (6) months without obtaining prior
      written permission from Franchisor and that Person’s employer. If
      Franchisor permits Franchisee to hire any such Person, then Franchisee
      agrees to pay Franchisor a non-refundable Management Development Fee in
      the amount of Twenty-Five Thousand Dollars ($25,000) per hired employee as
      of the date of hire; or
	 
	 		(e)		induce or attempt to induce any
      Person who is Franchisor’s employee or the employee of any Krispy Kreme
      Store or Commissary Facility to discontinue working for Franchisor or such
      Krispy Kreme Store or Commissary Facility, as the case may
be.
	 
	 		Franchisee and each of
      its Owners expressly acknowledges the possession of skills and abilities
      of a general nature and other opportunities for exploiting such skills in
      other ways, so that enforcement of the covenants contained in this
      Section 11.2 will not deprive any of them their personal goodwill
      or ability to earn a living. If Franchisee or any of its Owners fails or
      refuses to abide by any of the foregoing covenants and Franchisor obtains
      enforcement in a judicial or arbitration proceeding, the obligations
      under

14

	 		the
      breached covenant will be tolled during the period(s) of time that the
      covenant is breached and/or Franchisor seeks to enforce it and will
      continue in effect for a period of time ending two (2) years after the
      date of the order enforcing the covenant. 
	 
	11.3		Franchisor’s exercise of any of its rights under Section 11
      will be in addition to and not in limitation of any other rights and
      remedies it may have in the event of any breach or default by
      Franchisee. 
	 
	12.		RELATIONSHIP OF PARTIES/INDEMNIFICATION 
	 
	12.1		Neither
      this Agreement nor the dealings of the parties pursuant to this Agreement
      shall create any fiduciary relationship or any other relationship of trust
      or confidence between the parties. Franchisor and Franchisee, as between
      themselves, are and shall be independent contractors.
	 
	12.2	      	Franchisee understands and agrees that Franchisor may operate and
      change the Krispy Kreme System and its business in any manner that is not
      expressly and specifically prohibited by this Agreement. Whenever
      Franchisor has expressly reserved in this Agreement or is deemed to have a
      right and/or discretion to take or withhold an action, or to grant or
      decline to grant Franchisee a right to take or withhold an action, except
      as otherwise expressly and specifically provided in this Agreement,
      Franchisor may make its decision or exercise its right and/or discretion
      on the basis of its judgment of what is in its best interests, including
      its judgment of what is in the best interests of its franchise network, at
      the time its decision is made or its right or discretion is exercised,
      without regard to whether: (a) other reasonable alternative decisions or
      actions could have been made by Franchisor; (b) Franchisor’s decision or
      action promotes its financial or other individual interest; (c)
      Franchisor’s decision or action applies differently to Franchisee and one
      or more other franchisees or its company-owed operations; or (d)
      Franchisor’s decision or the exercise of its right or discretion is
      adverse to Franchisee’s interests. In the absence of an applicable
      statute, Franchisor will have no liability to Franchisee for any such
      decision or action. The parties intend that the exercise of Franchisor’s
      right or discretion will not be subject to limitation or review. If
      applicable law implies a covenant of good faith and fair dealing in this
      Agreement, the parties agree that such covenant shall not imply any rights
      or obligations that are inconsistent with a fair construction of the terms
      of this Agreement and that this Agreement grants Franchisor the right to
      make decisions, take actions and/or refrain from taking actions not
      inconsistent with Franchisee’s rights and obligations hereunder.
      
	 
	12.3		Nothing
      contained in this Agreement, or arising from the conduct of the parties
      hereunder, is intended to make either party a general or special agent,
      joint venturer, partner or employee of the other for any purpose
      whatsoever. Franchisee must conspicuously identify itself in all dealings
      with customers, lessors, contractors, suppliers, public officials,
      employees and others as the owner of development rights granted hereunder
      and must place such other notices of independent ownership on such forms,
      business cards, stationery, advertising and other materials as we may
      require from time to time. 
	 
	12.4		Franchisee may not make any express or implied agreements,
      warranties, guarantees or representations or incur any debt in
      Franchisor’s name or on its behalf or represent that the relationship of
      the parties hereto is anything other than that of independent contractors.
      Franchisor will not be obligated by or have any liability under any
      agreements made by Franchisee with any third party or for any
      representations made by Franchisee to any third party. Franchisor will not
      be obligated for any damages to any person or property arising directly or
      indirectly out of the operation of Franchisee’s business hereunder.
      
	 
	12.5		Franchisee agrees to indemnify Franchisor, its Affiliates and their
      respective directors, officers, employees, shareholders, members,
      managers, agents, successors and assigns (collectively “Indemnified
      Parties”), and to hold the Indemnified Parties harmless to the fullest
      extent permitted by law, from any and all losses and expenses (as defined
      below) incurred in connection with any litigation or other form of
      adjudicatory procedure, claim, demand, investigation, formal or informal
      inquiry (regardless of whether it is reduced to judgment) or any
      settlement thereof which arises directly or indirectly from, or as a
      result of, a claim of a third party against any one or more of the
      Indemnified Parties in connection with (a) Franchisee’s failure to perform
      or breach of any covenant, agreement, term or provision of this Agreement;
      (b) Franchisee’s breach of any representation or warranty contained in
      this Agreement; (c) Franchisee’s development, ownership, operation and/or
      closing of Krispy Kreme Stores or Commissary Facilities; and
    

15

	 		(d) any allegedly
      unauthorized service or act rendered or performed in connection with this
      Agreement (collectively “Event”), and regardless of whether it
      resulted from any strict or vicarious liability imposed by law on the
      Indemnified Parties. The foregoing indemnity shall apply even if it is
      determined that the Indemnified Parties’ negligence caused such loss,
      liability or expense, in whole or in part, provided, however, that this
      indemnity will not apply to any liability arising from a breach of this
      Agreement by Franchisor or with respect to any Indemnified Party whose
      gross negligence or willful acts caused such liability (except to the
      extent that joint liability is involved, in which event the
      indemnification provided herein will extend to any finding of comparative
      or contributory negligence attributable to Franchisee). The term
      “losses and expenses” includes compensatory, exemplary and punitive
      damages; fines and penalties; attorneys’ fees; experts’ fees; court costs;
      costs associated with investigating and defending against claims;
      settlement amounts; judgments; compensation for damages to Franchisor’s
      reputation and goodwill; and all other costs associated with any of the
      foregoing losses and expenses. Franchisor agrees to give Franchisee
      reasonable notice of any Event of which Franchisor becomes aware for which
      indemnification may be required, and Franchisor may elect (but is not
      obligated) to direct the defense thereof, provided that the selection of
      counsel shall be subject to Franchisee’s consent, which consent shall not
      be unreasonably withheld or delayed. Franchisor may, in its reasonable
      discretion, take such actions as Franchisor deems necessary and
      appropriate to investigate, defend or settle any event or take other
      remedial or corrective actions with respect thereto as may be necessary
      for the protection of the Indemnified Parties or Krispy Kreme Stores
      and/or Commissary Facilities generally, provided however, that any
      settlement shall be subject to Franchisee’s consent, which consent shall
      not be unreasonably withheld or delayed. Further, notwithstanding the
      foregoing, if the insurer on a policy or policies obtained in compliance
      with any Franchise Agreement agrees to undertake the defense of an Event
      (an “Insured Event”), Franchisor agrees not to exercise its right to
      select counsel to defend the Event if such would cause Franchisee’s
      insurer to deny coverage. Franchisor reserves the right to retain counsel
      to represent Franchisor with respect to an Insured Event at its sole cost
      and expense. This Section 12.5 shall continue in full force and
      effect subsequent to and notwithstanding the expiration or termination of
      this Agreement.
	 
	13.		MISCELLANEOUS
	 
	13.1	      	This Agreement and all
      issues arising from or relating to this Agreement shall be governed by and
      construed under the laws of the State of North Carolina, provided the
      foregoing shall not constitute a waiver of Franchisee’s rights under any
      applicable franchise law of another state. Otherwise, in the event of any
      conflict of law, North Carolina law will prevail, without regard to the
      application of North Carolina conflict of law principles, except that any
      North Carolina law regulating the sale of franchises or business
      opportunities or governing the relationship of a franchisor and its
      franchisees will not apply unless its jurisdictional requirements are met
      independently without reference to this section.
	 
	13.2		Franchisee and each of
      its Owners agree that the U.S. District Court for the Middle District of
      North Carolina, or if such court lacks jurisdiction, the Superior Court
      (or its successor) for Forsyth County, North Carolina, shall be the venue
      and exclusive forum in which to adjudicate any case or controversy arising
      from or relating to this Agreement and any guarantees or covenants by
      Franchisee’s Owners. In the event a case or controversy is to be heard by
      the Superior Court (or its successor) for Forsyth County, North Carolina,
      any party may request that the matter be assigned to the North Carolina
      Business Court. Franchisee and each of its Owners irrevocably submits to
      the jurisdiction of such courts and waives any objections to either the
      jurisdiction of or venue in such courts. Franchisee and each of its Owners
      irrevocably waives, to the fullest extent they may lawfully do so, the
      defense of an inconvenient forum to the maintenance of such suit, action
      or proceeding and agrees that service of process for purposes of any such
      suit, action or proceeding need not be personally served or served within
      the State of North Carolina but may be served with the same effect as if
      they were served within the State of North Carolina, by certified mail or
      any other means permitted by law, addressed to Franchisee and its Owners
      (as applicable) at the address set forth herein. Nothing contained herein
      shall affect Franchisor’s rights to bring a suit, action or proceeding in
      any other appropriate jurisdiction, including any suit, action or
      proceeding brought by Franchisor to enforce any judgment against
      Franchisee or any of its Owners entered by a State or Federal
    Court.

16

	13.3	      	Franchisor may obtain at any time in any court of competent
      jurisdiction any injunctive relief, including temporary restraining orders
      and preliminary injunctions, against conduct or threatened conduct for
      which no adequate remedy at law may be available or which may cause
      Franchisor irreparable harm. Franchisor may have such injunctive relief,
      without bond, but upon due notice, in addition to such further and other
      relief as may be available at equity or law, and Franchisee’s sole remedy
      in the event of the entry of such injunction, shall be the dissolution of
      such injunction, if warranted, upon hearing duly had (all claims for
      damages by reason of the wrongful issuance of any such injunction being
      expressly waived hereby). Franchisee and each of its Owners acknowledges
      that any violation of Sections 7.6, 8.2, 9.3(j) or 11.2 would
      result in irreparable injury to Franchisor for which no adequate remedy at
      law may be available. Accordingly, Franchisee and each of its Owners
      consents to the issuance of an injunction at Franchisor’s request (without
      posting a bond or other security) prohibiting any conduct in violation of
      any of those sections and agrees that the existence of any claims
      Franchisee or any of its Owners may have against Franchisor, whether or
      not arising herefrom, shall not constitute a defense to the enforcement of
      any of those Sections.
	 
	13.4		If
      Franchisor claims in any judicial proceeding that Franchisee owes
      Franchisor or any of its Affiliates money or that Franchisee has otherwise
      breached this Agreement and Franchisor prevails on such claims, then
      Franchisor shall be awarded its costs and expenses incurred in connection
      with such proceedings, including reasonable attorneys’ fees.
    
	 
	13.5		Except
      with respect to any of Franchisee’s obligations herein regarding the
      Confidential Information, the Marks, and any other intellectual property
      rights of Franchisor, Franchisor and Franchisee and its Owners each waive,
      to the fullest extent permitted by law, any right to or claim for any
      punitive or exemplary damages against the other. Franchisee and each of
      its Owners waive, to the fullest extent permitted by applicable law, the
      right to recover consequential damages for any claim directly or
      indirectly arising from or relating to this Agreement. FURTHERMORE, THE PARTIES AGREE THAT ANY LEGAL ACTION IN
      CONNECTION WITH THIS AGREEMENT SHALL BE TRIED TO THE COURT SITTING WITHOUT
      A JURY, AND ALL PARTIES WAIVE ANY RIGHT TO HAVE ANY ACTION TRIED BY
      JURY.
	  
	13.6		Every
      part of this Agreement shall be considered severable. If for any reason
      any part of this Agreement is held to be invalid, that determination shall
      not impair the other parts of this Agreement. If any covenant herein which
      restricts competitive activity is deemed unenforceable by virtue of its
      scope in terms of geographical area, type of business activity prohibited
      and/or length of time, but could be rendered enforceable by reducing any
      part or all of it, Franchisee and Franchisor agree that it will be
      enforced to the fullest extent permissible under applicable law. If any
      applicable law requires a greater prior notice of the termination of or
      refusal to enter into a successor franchise than is required hereunder, a
      different standard of “good cause”, or the taking of some other action not
      required hereunder, the prior notice, “good cause” standard and/or other
      action required by such law shall be substituted for the comparable
      provisions hereof. If any provision of this Agreement or any
      specification, standard or operating procedure prescribed by Franchisor is
      invalid or unenforceable under applicable law, Franchisor has the right,
      in its sole discretion, to modify such invalid or unenforceable provision,
      specification, standard or operating procedure to the extent required to
      make it valid and enforceable.
	 
	13.7		Franchisor and Franchisee may, by written instrument signed by the
      waiving party unilaterally, waive or reduce any obligation of the other
      under this Agreement. Any waiver granted by Franchisor shall be without
      prejudice to any other rights Franchisor may have, will be subject to
      continuing review by Franchisor and may be revoked, in its sole
      discretion, at any time and for any reason, effective upon delivery to
      Franchisee of 10 days’ prior notice. Franchisee and Franchisor shall not
      be deemed to have waived any right reserved by this Agreement by virtue of
      any custom or practice of the parties at variance with it; any failure,
      refusal or neglect by Franchisee or Franchisor to exercise any right under
      this Agreement or to insist upon exact compliance by the other with its
      obligations hereunder; any waiver, forbearance, delay, failure or omission
      by Franchisor to exercise any right, whether of the same, similar or
      different nature, with respect to other Krispy Kreme Stores; or the
      acceptance by Franchisor of any payments due from Franchisee after any
      breach of this Agreement. 

17

	13.8		The rights of Franchisor and Franchisee hereunder are cumulative
      and no exercise or enforcement by Franchisor or Franchisee of any right or
      remedy hereunder shall preclude the exercise or enforcement by Franchisor
      or Franchisee of any other right or remedy hereunder which Franchisor or
      Franchisee is entitled to enforce by law. 
	 
	13.9	      	The language of this Agreement shall be construed according to its
      fair meaning and not strictly against any party. The Basic Terms,
      introduction, personal guarantees and covenants, exhibits, schedules and
      riders (if any) to this Agreement are a part of this Agreement, which
      constitutes the entire agreement of the parties with respect to the
      subject matter hereof. Except as otherwise expressly provided herein,
      there are no other oral or written agreements, understandings,
      representations or statements relating to the subject matter of this
      Agreement, other than the Franchise Disclosure Document, that either party
      may or does rely on or that will have any force or effect. Nothing in this
      Agreement shall be deemed to confer any rights or remedies on any person
      or legal entity not a party hereto. This Agreement shall not be modified
      except by written agreement signed by both parties. 
	 
	13.10		The headings of sections are for convenience only and do not limit
      or construe their contents. The word “including” shall be construed to
      include the words “without limitation.” The term “Franchisee” is
      applicable to one or more persons, a corporation, limited liability
      company or a partnership and its owners, as the case may be. If two or
      more persons are at any time Franchisee hereunder, whether as partners,
      joint venturers or otherwise, their obligations and liabilities to
      Franchisor shall be joint and several. 
	 
	13.11		References to a controlling interest in an entity shall mean more
      than fifty percent (50%) of the equity and voting control of such
      entity. 
	 
	13.12		This Agreement is binding on the parties hereto and their
      respective executors, administrators, heirs, assigns and successors in
      interest. This Agreement may be executed in multiple copies, each of which
      shall be deemed an original. Time is of the essence in this
      Agreement. 
	 
	13.13		Whenever this Agreement requires the approval or consent of either
      party, the other party shall make written request therefor, and such
      approval or consent shall be obtained in writing; provided however, unless
      specified otherwise in this Agreement, such party may withhold approval or
      consent for any reason or for no reason at all. Furthermore, unless
      specified otherwise in this Agreement, no such approval or consent shall
      be deemed to constitute a warranty or representation of any kind, express
      or implied, and the approving or consenting party shall have no
      responsibility, liability or obligation arising therefrom.
    
	 
	13.14		All notices, requests and reports permitted or required to be
      delivered by this Agreement shall be deemed delivered: (a) at the time
      delivered by hand to the recipient party (or to an officer, director or
      partner of the recipient party); (b) one (1) business day after being
      placed in the hands of a commercial courier service for guaranteed
      overnight delivery; or (c) five (5) business days after placement in the
      United States Mail by Registered or Certified Mail, Return Receipt
      Requested, postage prepaid and addressed to the party to be notified at
      its most current principal business address of which the notifying party
      has been notified in writing. All payments and reports required by this
      Agreement shall be sent to Franchisor at the address identified in this
      Agreement unless and until a different address has been designated by
      written notice. No restrictive endorsement on any check or in any letter
      or other communication accompanying any payment shall bind Franchisor, and
      its acceptance of any such payment shall not constitute an accord and
      satisfaction.
	 
	14.		ACKNOWLEDGMENTS 
	 
	14.1		By initialing below, Franchisee hereby specifically acknowledges
      the following: 
	 
	 		(a)	      	Domicile. Franchisee
      acknowledges that Franchisee is not a domiciliary or a resident of any
      state, other than the state where the Development Area is predominantly
      located or, if different, the state listed in the Basic Terms as
      Franchisee’s address. 
					 
					Initials
      ________/________

18

	         	      	(b)	      	Receipt of
      Franchise Disclosure Document. Franchisee acknowledges having received Franchisor’s Franchise
      Disclosure Document at least fourteen (14) calendar days before signing a
      binding agreement or before making any payment to Franchisor or any of its
      Affiliates relating to this Agreement. Franchisee has read and understands
      Franchisor’s Franchise Disclosure Document. 
			 
			 		Initials ________/________ 
			 
			(c)		No Inconsistent
      Representations. Franchisee
      acknowledges that no representations have been made to Franchisee which
      are inconsistent with information presented in Franchisor’s Franchise
      Disclosure Document, and Franchisee has not relied on any representations
      inconsistent with or not contained in Franchisor’s Franchise Disclosure
      Document. 
			 
			 		Initials ________/________ 
			 
			(d)		Business Risks;
      Independent Investigation. Franchisee
      recognizes that the nature of Krispy Kreme Stores and Commissary
      Facilities may change over time, that an investment in a Krispy Kreme
      Store or Commissary Facility involves business risks and that the success
      of the investment is largely dependent on Franchisee’s own business
      abilities, efforts and financial resources. Franchisee has conducted an
      independent investigation of the business contemplated by this Agreement
      and recognizes that the food service industry is highly
      competitive. 
			 
			 		Initials ________/________ 
			 
			(e)		Independent
      Counsel. Franchisee acknowledges having
      had the opportunity to seek independent counsel concerning the execution
      of this Agreement. 
			 
			 		Initials ________/________ 
			 
			(f)		No Guarantee or
      Assurance. Franchisee has not received
      from Franchisor or its representatives or relied on any statement,
      representation, guaranty or assurance, express or implied, as to the
      revenues, profits or success of the business venture contemplated by this
      Agreement, nor has Franchisee received from Franchisor or its
      representatives any information from which Franchisee may easily ascertain
      a specific level or range of actual or potential sales, income, gross or
      net profits from franchised or non-franchised Krispy Kreme Stores or
      Commissary Facilities. 
			 
			 		Initials ________/________ 

     IN WITNESS
WHEREOF, the parties hereto have executed and
delivered this Agreement in multiple originals as of the Effective Date set
forth in the Basic Terms.

	KRISPY KREME DOUGHNUT CORPORATION  	 	[FRANCHISEE]  
	  
	By: 
    	 		By: 
    	 
	Name: 	 		Name: 	 
	Title:  	 		Title:  	 

19

EXHIBIT A

TO THE DEVELOPMENT AGREEMENT
BETWEEN
KRISPY KREME DOUGHNUT CORPORATION
AND
_____________________________
DATED____________,__________
 
DEVELOPMENT AREA

The Development Area is the geographic
area described as
follows and shown on the map attached as Exhibit
A-1:

	 
	 

DEVELOPMENT SCHEDULE

Franchisee agrees to have open and
operating in the Development Area the cumulative numbers of Krispy Kreme
Stores (of the types set forth below), and Commissary Facilities as of each of
the following dates:

	  	 	 		Fresh 	 	Commissary 		 
	Factory
      Stores 	     	Hot
      Shops 	     	Shops/Kiosks 	     	Facilities 	     	Date 
	 		 		 		 		 
	 		 		 		 		 
	 		 		 		 		 
	 		 		 		 		 
	 		 		 		 		 
	 		 		 		 		 

The last date of the table above shall
be the expiration date of this Agreement.

For purposes hereof, no Krispy Kreme Store
or Commissary Facility that is open and operating as of the date of this
Agreement shall be counted for purposes of the Development Schedule. In
addition, a Krispy Kreme Store or Commissary Facility that is permanently closed
after having been opened, other than as a result of noncompliance by Franchisee
with the terms of the applicable Franchise Agreement or Commissary Facility
Agreement, shall be deemed open for a period of six (6) months after the last
day it was open for business, provided that: (a) during such period of time,
Franchisee continuously and diligently takes such actions as may be required to
develop and open a substitute Krispy Kreme Store or Commissary Facility within
the Development Area pursuant to a new Franchise Agreement or Commissary
Facility Agreement, therefor and (b) by the end of such period Franchisee has
the substitute Krispy Kreme Store or Commissary Facility, as applicable, open
and operating in compliance with the Franchise Agreement or Commissary Facility
therefor.

A-1

EXHIBIT A-1

TO THE DEVELOPMENT AGREEMENT
BETWEEN
KRISPY KREME DOUGHNUT CORPORATION
AND
_____________________________
DATED____________,__________
 
MAP OF DEVELOPMENT AREA

 

 

 

A-1-1

EXHIBIT B

TO THE DEVELOPMENT AGREEMENT
BETWEEN
KRISPY KREME DOUGHNUT CORPORATION
AND
_____________________________
DATED____________,__________
 
FRANCHISEE INFORMATION

1.  Form of Entity of
Franchisee. 

     (a)  Corporation or Limited Liability Company.
Franchisee was organized on ___________, _______ under the laws of the State of
__________. Its Federal Identification Number is ________________. It has not
conducted business under any name other than its corporate or company name. The
following is a list of all of Franchisee’s directors and officers or managing
members as of _______________, _______.

	Name of Each
      Director/Officer/Managing Member  	          	Position(s)
      Held  
	 		 
	 		 
	 		 
	 		 
	 		 

     (b)  Partnership. Franchisee is a [general]
[limited] partnership formed on ___________, _______under the laws of the State
of __________. Its Federal Identification Number is ______________________. It
has not conducted business under any name other than its partnership name. The
following is a list of all of Franchisee’s general partners as of
_______________, _______.

	Name of Each General
      Partner         
        	
	 	
	 	
	 	

B-1

	2.	      	Owners.
      Franchisee and each of its Owners represents and warrants that the
      following is a complete and accurate list of all Owners of Franchisee,
      including the full name and mailing address of each Owner, and fully
      describes the nature and extent of each Owner’s interest in Franchisee.
      Franchisee and each Owner as to his/her ownership interest, represents and
      warrants that each Owner is the sole and exclusive legal and beneficial
      owner of his/her ownership interest in Franchisee, free and clear of all
      liens, restrictions, agreements and encumbrances of any kind or nature,
      other than those required or permitted by this
  Agreement.

 

	Owner’s Name
      and Mailing Address  	 	Percentage
      and Nature of  
	  	        	Ownership
      Interest  
	 		 
	 		 
	 		 
	 		 
	 		 

Submitted by Franchisee
Accepted by
Franchisor and
made a part of the Development
Agreement as of_______________, _______.

	KRISPY
      KREME DOUGHNUT  		 
	     
       CORPORATION,  	     
          	(Name
      of corporation, limited liability 
	a
      North Carolina corporation  	 	company or partnership) 
				 	
				 	
	By: 
    	 	 	By: 
    	 
	Print
      Name: 	 		Print
      Name: 	 
	Title:  	 		Title:  	 
				 	
	  			By: 
    	 
	  			Print
      Name: 	 
	  			Title:  	 
				 	
	  			Owners:  
				  
	  			(Signature)  
				  
	  			(Print
      Name)  
				  
	  			(Signature)  
				 
	  			(Print
      Name)  

B-2

EXHIBIT C

TO THE DEVELOPMENT AGREEMENT
BETWEEN
KRISPY KREME DOUGHNUT CORPORATION
AND
_____________________________
DATED____________,__________
 
FORM OF FRANCHISE AGREEMENT

(Please see Exhibit 10.3 to the
Company’s Annual Report on Form 10-K for fiscal 2008)

 

 

C-1

EXHIBIT D

TO THE DEVELOPMENT AGREEMENT
BETWEEN
KRISPY KREME DOUGHNUT CORPORATION
AND
_____________________________
DATED____________,__________
 
FORM OF COMMISSARY FACILITY AGREEMENT

 

 

 

D-1

KRISPY KREME DOUGHNUT
CORPORATION
COMMISSARY FACILITY AGREEMENT
BASIC TERMS

FOR USE ONLY TOGETHER WITH A HOT
SHOP OR
FRESH SHOP/KIOSK AGREEMENT

	A. 	Effective
      Date  	  
	  	(Insert date Franchisee 
    	  
	  	executes the
      agreement):  	  
	B. 	Franchisor:  	Krispy
      Kreme Doughnut Corporation, a North Carolina corporation 
  
	C. 	Facility
      Number:  	  
	D. 	Facility
      Address:  	  
	E. 	Franchisee:  	  
	  	Franchisee’s
      Address:  	  
	 	Telephone:  	 	Fax No.: 	 
	  	E-mail
      Address:  	  
	F. 	Principal
      Owners:  	  
	G. 	Managing
      Director:  	  
	H. 	General
      Manager:  	  
	I. 	Term:  	The time
      period commencing on the Effective Date and expiring 15 

	 	 	years after the
      Effective Date 

 
 

		Franchisor:  	 
		  	(initials) 
		Franchisee:  	  
		  	(initials) 

D-2

TABLE OF CONTENTS

	  		  	Page 
	1. 		BACKGROUND  	5 
	2. 		DEFINITIONS  	5 
	3. 		ACKNOWLEDGMENTS, REPRESENTATIONS, AND WARRANTIES 	9 
	4. 		GRANT OF
      FRANCHISE 	11 
	5. 		FRANCHISOR’S RESERVATION OF RIGHTS 	12 
	6. 		SITE
      SELECTION 	12 
	7. 		LEASE OR PURCHASE OF SITE 	13 
	8. 		FACILITY
      DEVELOPMENT 	13 
	9. 		BUILDING, EQUIPMENT, FIXTURES, FURNISHINGS, SIGNS AND
      SUPPLIES 	14 
	10. 		COMPUTER
      SYSTEM 	15 
	11. 	 	FACILITY OPENING 	16 
	12. 		CAPITAL
      IMPROVEMENTS 	16 
	13. 		ROYALTIES 	17 
	14. 		TRAINING AND
      GUIDANCE 	17 
	15. 		SYSTEM STANDARDS 	18 
	16. 		MARKS 	19 
	17. 		CONFIDENTIAL INFORMATION 	20 
	18. 		PATENTS AND
      INVENTIONS 	21 
	19. 		WORKS OF AUTHORSHIP AND COPYRIGHTS 	22 
	20. 		EXCLUSIVE
      RELATIONSHIP 	23 
	21. 		COMPLIANCE WITH LAW 	23 
	22. 	     	MARKETING AND
      ADVERTISING 	24
  

D-3

TABLE OF CONTENTS
(continued)

	  		  	  	Page 
	23.  		ACCOUNTING, REPORTS AND FINANCIAL
      STATEMENTS  	25 
	24. 
    	 	TRANSFER  	26 
	25.  		SUCCESSOR FRANCHISE  	29 
	26. 
    		TERMINATION OF FRANCHISE  	30 
	27.  		EFFECT OF TERMINATION OR EXPIRATION  	31 
	28. 
    		RELATIONSHIP OF PARTIES/INDEMNIFICATION  	34 
	29.  		MISCELLANEOUS  	37 
	30. 
    	     	ACKNOWLEDGMENTS  	39
  

 

	EXHIBIT A  	    
         	FRANCHISEE INFORMATION  
	EXHIBIT
      B  		PRINCIPAL
      OWNERS’ PERSONAL GUARANTY  
	EXHIBIT C  	 	INVESTOR PERSONAL COVENANTS  
	EXHIBIT
      D  		AUTHORIZATION
      FOR ACH DEBITS OR CREDITS  
	EXHIBIT E  		AUTHORIZED OFF-PREMISES SALES  

D-4

KRISPY KREME DOUGHNUT
CORPORATION
COMMISSARY FACILITY
AGREEMENT

     THIS
COMMISSARY FACILITY AGREEMENT (this “Agreement”) is made and entered into as of
the Effective Date by and between Franchisor and Franchisee.

	1.   
        	BACKGROUND 
	              
    	
	1.1   
        	Franchisor has
      developed, as a result of considerable time, skill, effort, and money, a
      distinctive system for operating stores called “Krispy Kreme Stores” that
      offer and serve a variety of doughnuts, beverages, and other authorized
      products and services under the Marks. 
	 
	1.2   
        	Franchisor’s
      Affiliate, HDN Development Corporation, owns the Marks and has granted
      Franchisor the right to sublicense the Marks to its franchisees for their
      use in producing the Products. 
	 
	1.3   
        	Franchisor grants
      franchises to own and operate Krispy Kreme Stores and Commissary
      Facilities to Persons who meet its qualifications and are willing to
      undertake the investment and effort to properly develop and operate
      them. 
	 
	1.4   
        	Franchisee has
      submitted a Franchise Application to own and operate a Commissary Facility
      at the Site, and Franchisor has accepted the application in reliance on
      all information Franchisee has provided in connection therewith.
  
	 
	2.   
        	DEFINITIONS 
	 
	2.1   
        	Capitalized terms used
      in this Agreement have the meanings given to them in this Section and in
      the Basic Terms. 
	 
	 	Account
      – Franchisee’s bank account as to which
      Franchisee has provided Franchisor with all appropriate account
      information and from which Franchisee has authorized Franchisor to
      withdraw funds by electronic funds transfers. 
	 
	 	Affiliate
      – Any person that directly or
      indirectly owns or controls, that is directly or indirectly owned or
      controlled by, or that is under common ownership or control with the
      referenced person, including parents and subsidiaries. 
	 
	 	Authorized
      Off-Premises Sales – Sales to wholesale
      customers pursuant to an express authorization by Franchisor, the current
      form of which is attached as Exhibit
      E. 
	 
	 	Basic Terms
      – The terms of this Agreement set forth
      on the Krispy Kreme Doughnut Corporation Commissary Facility Agreement
      Basic Terms section on the first page hereof. 
	 
	 	Brand Fund
      – As defined in Section 22.
  
	 
	 	Commissary Facility
      – A manufacturing facility for
      doughnuts and other Products that are supplied to Hot Shops and Fresh
      Shops/Kiosks. Commissary Facilities are not used for retail sales, but may
      distribute and sell to wholesale customers, subject to Franchisor’s
      authorization pursuant to the Commissary Facility Agreement. 
	 
	 	Commissary Facility
      Agreement – An agreement, such as this
      Agreement, used by Franchisor to grant the right to operate a Commissary
      Facility at a specific location. 
	 
	 	Competitive
      Business – A business, other than a
      Krispy Kreme Store or Commissary Facility, that: (a) makes, sells or
      distributes yeast-raised doughnuts, cake doughnuts, or any other types of
      doughnuts, miniature doughnuts, doughnut holes or any other bakery
      products in any distribution channel to any customer for consumption or
      resale, and such sales constitute ten percent (10%) or more of its total
      sales (or such sales from any single location constitute 10% or more of
      the total sales of that location) during any calendar quarter or calendar
      year; (b) sells coffee or coffee drinks in any distribution channel to any
      customer for consumption or resale, and such sales constitute twenty
      percent (20%) or more of its total sales (or such sales from any single
      location constitute 20% or more of the total sales of that
      location) 

D-5

		
      during any calendar quarter or
      calendar year; (c) is the same as, or similar to, the Krispy Kreme Store
      concept as it evolves over time; or (d) grants franchises or licenses, or
      establishes joint ventures, for the development and/or operation of any
      business referred to in (a) through (c), above. Restrictions in this
      Agreement on having an Ownership Interest in a Competitive Business shall
      not apply to the ownership of shares of a class of securities listed on a
      stock exchange or traded on a public stock market that represents less
      than three percent (3%) of the number of shares of that class of
      securities issued and outstanding.
 
Confidential Information –
      Certain confidential information relating to the development and operation
      of Krispy Kreme Stores and Commissary Facilities, which
      includes:

				 
		(a)	           
    	methods, techniques,
      equipment, specifications, standards, policies, procedures, information,
      concepts, and systems relating to and knowledge of and experience in the
      development, equipping, operation, outfitting, and franchising of Krispy
      Kreme Stores and Commissary Facilities, as well as expansion, growth and
      development plans, and prospects; 
	              
    			
		(b)		marketing and
      advertising programs for Krispy Kreme Stores and Commissary
      Facilities; 
		 
		(c)		knowledge concerning
      the logic, structure, and operation of computer software programs that
      Franchisor authorizes for use in connection with the operation of Krispy
      Kreme Stores and Commissary Facilities, and all additions, modifications
      and enhancements, and all data generated from use of such programs;
    
		 
		(d)		specifications and
      standards for, and sources of, buildings, equipment, furnishings,
      fixtures, signs, products, materials, supplies, and services utilized in
      the development and operation of Krispy Kreme Stores and Commissary
      Facilities; 
		 
		(e)		ingredients, formulas,
      mixes, recipes for and methods of preparation, cooking, serving,
      packaging, and delivery of the Products; 
		 
		(f)		information concerning
      sales, operating results, financial performance, consumer preferences,
      inventory requirements, materials and supplies, and other financial data
      of Krispy Kreme Stores and Commissary Facilities, and customer
      lists; 
		 
		(g)		current and concluded
      research, development and test programs for products, services and
      operations for use in Krispy Kreme Stores and Commissary
      Facilities; 
		 
		(h)		the contents of any
      System Standards Manuals, System Standards, and site selection criteria;
      and 
		 
		(i)		employee training, and
      staffing levels. 
				 
		
      Development Agreement – If
      applicable, the Krispy Kreme Doughnut Corporation Development Agreement
      pursuant to which Franchisor has granted Franchisee the right to develop
      Krispy Kreme Stores and Commissary Facilities in the Development Area and
      pursuant to which this Agreement has been
      executed.
 
Development
      Area – If applicable, the geographic
      area in which Franchisee has the right to develop Krispy Kreme Stores and
      Commissary Facilities, as set forth in the Development
      Agreement.
 
FACILITY
      –The Commissary Facility that
      Franchisor authorizes Franchisee to operate at the Site pursuant to this
      Agreement. The term includes all of the assets of the
      FACILITY.
 
Factory
      Store – A retail sales facility with
      the manufacturing capability to produce fresh doughnuts in accordance with
      System Standards. Additionally, Factory Stores may have some capacity to
      supply fresh doughnuts to Hot Shops and Fresh
      Shops/Kiosks.
 
Force Majeure
      – Any of the following events or
      circumstances: (i) fire, earthquake, storm, hurricane, tornado, flood or
      other act of God; (ii) war, act of terrorism, insurrection, rebellion,
      riots or other civil unrest; (iii) epidemics, quarantine restrictions or
      other public health restrictions or advisories; and (iv) other similar
      events beyond the reasonable control of the
party.

D-6

	              
    	
      Franchise – The rights granted
      and the obligations imposed pursuant to this Agreement that relate to the
      development and operation of the Commissary Facility at the
      Site.
 
Franchise Agreement
      – An agreement used by Franchisor to
      grant a franchise for the operation of a Krispy Kreme Store at a specific
      location.
 
Franchise
      Application – The application submitted
      by Franchisee for the Franchise.
 
Franchise Disclosure Document –
      The franchise disclosure document required by applicable
      law.
 
Franchisee – As defined in the
      Basic Terms.
 
Franchisor – As defined in the
      Basic Terms.
 
Fresh
      Shop/Kiosk – A retail sales facility
      with limited manufacturing capabilities (e.g. icing and filling
      equipment), or no manufacturing capabilities, that receives doughnuts from
      a Factory Store or a Commissary Facility and finishes them as necessary to
      sell in accordance with System Standards.
 
Fundraising – Sales
      of doughnuts, redemption cards, or coupons to charitable, educational, and
      other nonprofit organizations restricted to those located within the
      FACILITY’s local market area (as Franchisor may determine from time to
      time) for resale (or giving) to consumers.
 
General Manager – The
      general manager of the FACILITY. The initial general manager is identified
      in the Basic Terms.
 
Good
      Standing – The condition that
      Franchisee and its Affiliates: (i) are current with all payments due to
      Franchisor, its Affiliates and suppliers; and (ii) are not in default of
      any of their obligations under this Agreement, any Development Agreement
      (including any Development Schedule), any Franchise Agreement, any
      Commissary Facility Agreement or any other agreement between the parties
      hereto or any of their Affiliates.
 
Hot Shop – A retail sales
      facility with an impinger oven and limited manufacturing capabilities
      (e.g., icing and filling equipment) that receives doughnuts from a Factory
      Store or a Commissary Facility and finishes them as necessary to sell in
      accordance with System Standards.
 
Immediate Family – The spouse,
      parents, brothers, sisters and children, whether natural or adopted, of
      the referenced Person.
 
Krispy Kreme Store(s) – Stores
      which Franchisor or any of its Affiliates own, operate or franchise and
      which use the Marks and the System. Krispy Kreme Stores include Factory
      Stores, Hot Shops and Fresh Shops/Kiosks,
      but do not include Commissary
      Facilities.
  
Managing
      Director – The person designated as
      managing director of Franchisee’s business pursuant to Section 20.2. The
      initial Managing Director is identified in the Basic
      Terms.
 
Marks – The current and future
      trademarks, service marks, logos, designs, trade names, and other
      commercial symbols, together with all distinctive trade dress elements, or
      combinations thereof, used by Franchisor to identify the sources of goods
      and services offered and sold at Krispy Kreme Stores, including the
      trademark and service mark KRISPY KREME®.
 
Net
      Sales – All the FACILITY’s revenue from
      food, beverages, and other products and merchandise of any type whatsoever
      sold, whether or not produced at the FACILITY or acquired from a third
      party, including Products purchased from other Krispy Kreme franchises
      (regardless whether owned by Franchisee) and services rendered at or away
      from the FACILITY (whether or not such sales are authorized by Franchisor)
      or from any use of the Marks, recorded using the accrual basis of
      accounting and otherwise in accordance with accounting principles
      generally accepted in the United States. Without limiting the foregoing,
      and for the avoidance of doubt, “Net Sales” (a) includes all amounts
      Franchisee receives or has the right to receive from the conveyance of
      products and services, whether such sales are made for cash or cash
      equivalents (including credit, debit and gift cards) or on credit terms,
      but excludes (i) sales and similar taxes collected or which Franchisee has
      the right to collect from customers and 

D-7

	              
    	
      which Franchisee is required by law
      to remit to a taxing authority, (ii) customer refunds, (iii) credits for
      product returns and (iv) sales or delivery of products to Krispy Kreme
      Stores or Commissary Facilities (regardless whether owned by Franchisee),
      and (b) shall not be reduced by any charge or other provision for
      uncollectible accounts. Neither the inclusion of any type of revenue in
      the definition of Net Sales nor Franchisor’s demand or receipt of
      Royalties or Brand Fund contributions on such revenues shall constitute a
      waiver or approval of any unauthorized sales by Franchisee hereunder, and
      Franchisor reserves all rights and remedies with respect
      thereto.
 
Owner – Each Person (and
      permitted transferee of each such Person) holding: (a) a direct or
      indirect, legal or beneficial Ownership Interest or voting rights in
      Franchisee or any Affiliate of Franchisee that owns an Ownership Interest
      or voting rights in Franchisee; (b) a direct or indirect, legal or
      beneficial interest in this Agreement; (c) a direct or indirect, legal or
      beneficial interest in the FACILITY; or (d) any other legal or equitable
      interest, or the power to vest in himself or herself or itself any legal
      or equitable interest, in the revenue, profits, rights or assets arising
      from any of the foregoing.
 
Ownership Interest – Any direct
      or indirect, legal or beneficial ownership interest of any type, including
      (a) in relation to a corporation, the ownership of shares in the
      corporation; (b) in relation to a partnership, the ownership of a general
      or limited partnership interest; (c) in relation to a limited liability
      company, the ownership of a membership interest; or (d) in relation to a
      trust, the ownership of a legal or beneficial interest of such
      trust.
 
Payment
      Day – The day of the Week on which
      Royalties are due, which day currently is Friday, but may be changed at
      Franchisor’s sole discretion.
 
Person – Any individual,
      corporation, limited liability company, general or limited partnership,
      unincorporated association, cooperative or other legal or functional
      entity.
 
Principal Owner
      – An Owner with an Ownership Interest
      in Franchisee of ten percent (10%) or more.
 
Products – The
      current and future products that Franchisor authorizes to be offered and
      sold at Krispy Kreme Stores, including (a) fresh doughnuts (including,
      yeast-raised doughnuts, cake doughnuts, miniature doughnuts, and doughnut
      holes, which doughnuts have various types and flavors of fillings, glazes,
      or other coatings); (b) hot or cold fresh-brewed coffee beverages suitable
      for immediate consumption; (c) hot or cold espresso drinks suitable for
      immediate consumption; (d) frozen beverages suitable for immediate
      consumption; and (e) such other products and beverages as we may determine
      from time to time.
 
Reporting Day – The day of the
      Week by which Franchisee is required to report Net Sales to Franchisor,
      which day currently is Tuesday, but may be changed at Franchisor’s sole
      discretion.
 
Restricted
      Person – Franchisee, its Owners and
      Affiliates, and members of the Immediate Families of Franchisee (if a
      natural Person), and its Owners and
      Affiliates.
 
Royalties – As set forth in
      Section 13.
 
Site – The location of the
      FACILITY with the street address identified in the Basic
      Terms.
 
System – Those business formats,
      methods, procedures, signs, designs, layouts, equipment, and mixes
      designated by Franchisor from time to time for use in operating Krispy
      Kreme Stores and Commissary Facilities.
 
System Standards –
      The mandatory and suggested specifications, standards, operating
      procedures and rules that Franchisor prescribes from time to time for the
      operation of Krispy Kreme Stores and Commissary Facilities, including the
      standards, specifications and other requirements related to the purchase,
      preparation, marketing and sale of the Products; on-premises sales,
      Authorized Off-Premises Sales; customer service; the design, décor and
      appearance of the FACILITY; the maintenance and remodeling of the FACILITY
      and the equipment, fixtures and furnishings therein; the use and display
      of 

D-8

		the Marks; the
      insurance coverage required to be carried for the FACILITY; the training
      of FACILITY employees; the days and hours of FACILITY operation; and the
      content, quality and use of advertising and promotional
    materials.
	 
		System Standards
      Manuals – The documents and other media
      that contain the System Standards.
	 
		Term
      – As defined in the Basic Terms.
	 
		Transfer or
      Transfer the Franchise (or similar
      words) – The direct or indirect sale, assignment, transfer, exchange,
      conversion, license, sublicense, lease, sublease, mortgage, pledge,
      collateral assignment, grant of a security, collateral or conditional
      interest or other encumbrance in or on, or other disposition, whether
      voluntary, involuntary, by operation of law or otherwise, of this
      Agreement, of any interest in or right under this Agreement, any form of
      legal or beneficial ownership interest in Franchisee, or any form of
      ownership interest or right to participate in or receive the benefits of
      the assets, revenues, income or profits of Franchisee’s business, or any
      one or more other acts or events not covered by the foregoing that
      Franchisor reasonably determines to be a form of direct or indirect
      transfer, including: (a) any transfer, redemption or issuance of a legal
      or beneficial ownership interest in the capital stock of, a membership
      interest in, or a partnership interest in, Franchisee or any interest
      convertible into or exchangeable for capital stock of, a membership
      interest in or a partnership interest in, Franchisee; (b) any merger or
      consolidation of Franchisee, whether or not Franchisee is the surviving
      entity, or any conversion of Franchisee from one form of legal entity into
      another form of legal entity, or any sale, exchange, encumbrance or other
      disposition of Franchisee’s assets; (c) any transfer in connection with or
      as a result of a divorce, dissolution of marriage or similar proceeding or
      a property settlement or legal separation agreement in the context of a
      divorce, dissolution or marriage or similar proceeding, an insolvency,
      bankruptcy or assignment for benefit of creditors, a judgment, a
      corporate, limited liability company or partnership dissolution or
      otherwise by operation of law; or (d) any transfer by gift, declaration of
      trust, transfer in trust, revocation of trust, trustee succession, trust
      termination, discretionary or mandatory trust distribution, occurrence of
      any event (e.g., death of a person) that affects or ripens the rights of
      contingent beneficiaries, exercise of a power of appointment, exercise of
      a withdrawal right, adjudication of Franchisee or any Principal Owner as
      legally disabled, or upon or after Franchisee’s death or the death of any
      of Franchisee’s Principal Owners by will, disclaimer or the laws of
      intestate succession or otherwise.
	 
		Week
      – Any consecutive seven (7) calendar day period
      that Franchisor may designate from time to time, currently consisting of
      each seven (7) calendar day period ending at 11:59 PM on each
      Sunday.
	              	
	2.2	Other terms used in
      this Agreement are defined in the context in which they
arise.
	 
	3.	ACKNOWLEDGMENTS,
      REPRESENTATIONS, AND WARRANTIES
	 
	3.1	Franchisee
      acknowledges that Franchisee has read this Agreement and Franchisor’s
      Franchise Disclosure Document and understands and accepts the terms and
      conditions contained in this Agreement as being reasonably necessary to
      maintain Franchisor’s high standards of quality and service. Franchisee
      further acknowledges that the uniformity of those standards at each Krispy
      Kreme Store is reasonably necessary to protect and preserve the goodwill
      of the Marks. Franchisee acknowledges that Franchisee has conducted an
      independent investigation of the business venture contemplated by this
      Agreement and recognizes that, like any other business, the nature of the
      business conducted by a Commissary Facility may evolve and change over
      time, that an investment in a Commissary Facility involves business risks,
      and that Franchisee’s business abilities and efforts are vital to the
      success of the venture. Any information Franchisee acquires from other
      Krispy Kreme Store or Commissary Facility franchisees relating to their
      sales, profits, or cash flows does not constitute information obtained
      from Franchisor, nor does Franchisor make any representation as to the
      accuracy of any such information or the likelihood of Franchisee achieving
      comparable results. Franchisee acknowledges that, in all of its dealings
      with Franchisor, Franchisor’s officers, directors, employees and agents
      act only in a representative, and not in an individual, capacity. All
      business dealings between Franchisee and such Persons in connection
      with

D-9

		this
      Agreement are solely between Franchisee and Franchisor. Franchisee further
      acknowledges that Franchisor has advised Franchisee to have this Agreement
      reviewed and explained to Franchisee by an attorney.
	              	
	3.2	Franchisee
      represents and warrants to Franchisor, as an inducement to Franchisor’s
      entry into this Agreement, that all statements Franchisee has made and all
      materials Franchisee has submitted to Franchisor in connection with
      Franchisee’s Franchise Application for and purchase of the Franchise are
      accurate and complete and that Franchisee has made no misrepresentations
      or material omissions to obtain the Franchise. Franchisor has approved
      Franchisee’s Franchise Application for a franchise for a Commissary
      Facility in reliance on each of Franchisee’s representations to
      Franchisor.
	 
	3.3	Franchisee
      represents and warrants to Franchisor that Franchisee has the authority to
      execute and deliver this Agreement and to perform Franchisee’s obligations
      hereunder.
	 
	3.4	Franchisee
      represents and warrants to Franchisor that this Agreement has been duly
      executed and delivered by Franchisee and, assuming the due authorization,
      execution and delivery by Franchisor, constitutes a legal, valid and
      binding obligation of Franchisee, enforceable in accordance with its
      terms.
	 
	3.5	Franchisee
      represents and warrants to Franchisor that Franchisee’s execution and
      delivery of this Agreement does not, and Franchisee’s performance of its
      obligations under this Agreement will not, with or without the giving of
      notice or the lapse of time or both, (a) conflict with or violate its
      organizational documents, if applicable, (b) conflict with or violate any
      law, statute, ordinance, rule, regulation, order, judgment or decree
      applicable to Franchisee, or (c) conflict with, result in any breach of,
      or constitute a default under, any contract, agreement, lease, license,
      permit, franchise or other instrument or obligation to which Franchisee is
      a party or by which Franchisee is bound.
	 
	3.6	Franchisee
      represents and warrants to Franchisor that: (a) Franchisee owns fee simple
      title to the real property and improvements which comprise the FACILITY;
      or (b) if Franchisee holds a leasehold interest in the FACILITY,
      Franchisee has or will have a binding and effective lease with a lease
      term (plus renewal options) extending at least to the end of the Term and
      otherwise conforming to Franchisor’s requirements in accordance
      with Section 7.
	 
	3.7	If
      Franchisee is, or at any time becomes, a business corporation,
      partnership, limited liability company or other legal entity, Franchisee
      and each of its Principal Owners represent, warrant and agree that: (a)
      Franchisee is duly organized and validly existing
      under the laws of the state of its organization, and, if a foreign
      business corporation, partnership, limited liability company or other
      legal entity, Franchisee is duly qualified to transact business in the
      state in which the FACILITY is located; (b) Franchisee has the authority
      to execute and deliver this Agreement and to perform its obligations
      hereunder; (c) true and complete copies of the articles of incorporation,
      articles of organization, operating agreement or principles, partnership
      agreement, bylaws, subscription agreements, buy-sell agreements, voting
      trust agreements, trust agreements and all other documents relating to
      Franchisee’s ownership, organization, capitalization, management and
      control (“Organizational Documents”) shall be promptly delivered to
      Franchisor for its approval, which approval shall not be unreasonably
      withheld; (d) any and all amendments, deletions and additions to
      Franchisee’s Organizational Documents shall be promptly delivered to
      Franchisor for its approval, which approval shall not be unreasonably
      withheld; (e) Franchisee’s activities are restricted to those necessary
      solely for the development, ownership and operation of Krispy Kreme Stores
      and Commissary Facilities in accordance with this Agreement and in
      accordance with any other agreements entered into with Franchisor or any
      of its Affiliates; (f) the Organizational Documents recite that the
      issuance, transfer or pledge of any direct or indirect legal or beneficial
      ownership interest is restricted by the terms of this Agreement; (g) all
      certificates representing direct or indirect legal or beneficial ownership
      interests now or hereafter issued must bear a legend in conformity with
      applicable law reciting or referring to such restrictions; and (h)
      Franchisee will deliver to Franchisor a Secretary/Clerk’s/Trustee’s
      Certificate or other evidence satisfactory to Franchisor that the
      execution, delivery and performance of this Agreement and all other
      agreements and ancillary documents

D-10

	 	contemplated hereby or
      thereby have been duly authorized by all necessary action by the
      corporation, partnership, limited liability company or other legal entity,
      as applicable, and are within the legal powers of Franchisee’s trustee, if
      Franchisee is a trust.
	              	 
	3.8	Franchisee and each of
      its Principal Owners represent, warrant, and agree that Exhibit A
      is current, complete and accurate. Franchisee agrees that an updated
      Exhibit A will be furnished promptly to Franchisor, so that
      Exhibit A (as so revised and signed by Franchisee) is at all times
      current, complete and accurate. Each person who is or becomes a Principal
      Owner must execute an agreement in the form Franchisor prescribes,
      undertaking to guarantee and be bound jointly and severally by the terms
      of this Agreement, the current form of which is attached hereto as
      Exhibit B. Each person who is or becomes an Owner, whether or not a
      Principal Owner, must execute an agreement in the form Franchisor
      prescribes, undertaking to be bound by the confidentiality and
      non-competition covenants contained in this Agreement, the current form of
      which is attached hereto as Exhibit C. Each Owner must be an
      individual acting in his/her individual capacity, unless Franchisor waives
      this requirement.
	 
	3.9	The provisions of
      Section 3 constitute continuing
      representations and warranties, and Franchisee and Franchisee’s Principal
      Owners shall notify Franchisor immediately in writing of the occurrence of
      any event or the development of any circumstance that might render any of
      the foregoing representations and warranties false, inaccurate, or
      misleading.
	 
	4.	GRANT OF
      FRANCHISE
	 
	4.1	Subject to the terms
      of and on the conditions contained in this Agreement, Franchisor hereby
      grants to Franchisee the right to operate the FACIILTY during the Term and
      to use the Marks and the System in the performance of Franchisee’s
      obligations under this Agreement. Franchisee shall use the FACILITY to
      manufacture certain authorized Products (a) to be distributed to, and
      offered for sale at, Krispy Kreme Stores that are categorized as Hot
      Shops, Fresh Shops or Kiosks and established and operated pursuant to
      Franchise Agreements entered into between Franchisor and Franchisee and
      (b) to be sold as Authorized Off-Premises Sales.
	 
	4.2	Franchisee will
      faithfully, honestly, and diligently perform Franchisee’s obligations
      under this Agreement. Franchisee will continuously exert its best efforts
      to promote and enhance the operation of the FACILITY and to maximize the
      sale of Products.
	 
	4.3	Franchisee may not
      operate the FACILITY from any location other than the Site without
      Franchisor’s prior written consent. If Franchisor consents to the
      relocation of the FACILITY, Franchisor has the right to charge Franchisee
      for its expenses in connection with the relocation.
	 
	4.4	Franchisee agrees that
      the FACILITY will be under direct, on-premises management by a trained
      Managing Director or General Manager or one of Franchisee’s other
      managers, all of whom must have completed training to Franchisor’s
      satisfaction.
	 
	4.5	Franchisee agrees that
      the FACILITY will not be closed for five (5) or more consecutive days
      without Franchisor’s prior written consent.
	 
	4.6	Franchisee expressly
      acknowledges and agrees that (a) the FACILITY may only produce the
      Products that Franchisor authorizes from time to time and shall not
      produce or store any other food products whatsoever; (b) the FACILITY
      shall only produce authorized Products for distribution to Franchisee’s
      Krispy Kreme Stores that do not have production capabilities for such
      Products (such as Hot Shops, Fresh Shops and Kiosks) for sale at such
      stores; and (c) except for Authorized Off-Premises Sales, the FACILITY
      shall not sell or distribute any Products to any other Persons or
      locations, including any other Krispy Kreme Stores owned by other
      franchisees or any sales for Fundraising purposes.
	 
	4.7	Either party shall
      have the right at any time to terminate this Agreement without cause,
      effective ninety (90) days after notice thereof to the other, provided
      Franchisee no longer operates any Krispy Kreme Stores that are categorized
      as Hot Shops, Fresh Shops or Kiosks.

D-11

	5.	FRANCHISOR’S
      RESERVATION OF RIGHTS
	              	 
	5.1	Franchisor and its
      Affiliates (and their respective successors and assigns, by purchase,
      merger, consolidation or otherwise) retain all rights not expressly
      granted to Franchisee in this Agreement, including those with respect to
      Krispy Kreme Stores and Commissary Facilities, the Marks, and the sale of
      Products, including all rights Franchisor expressly reserves in this
      Section 5. Franchisee waives, to the fullest extent permitted under
      applicable law, all claims, demands or causes of action arising from or
      related to any of such activities by Franchisor or any of its
      Affiliates.
	 
	5.2	No exclusive
      territory, protection, or other right in the contiguous space, area, or
      market of the FACILITY is expressly or impliedly granted to Franchisee
      under this Agreement, and Franchisor reserves the right to operate and to
      grant others the right to operate Krispy Kreme Stores or Commissary
      Facilities at any location on such terms and conditions as it deems
      appropriate. Franchisee acknowledges and agrees that such Krispy Kreme
      Stores or Commissary Facility may be in direct competition with the
      FACILITY, without regard to any adverse effect on the FACILITY and without
      any obligation or liability to Franchisee.
	 
	5.3	Franchisor reserves
      the right to acquire, develop, and operate, or be acquired by, any
      company, including a company operating one or more food service businesses
      (including food service businesses selling doughnuts or
  coffee).
	 
	5.4	Franchisor reserves
      the right to license, sample, sell, or market by any means whatsoever
      (including the Internet) the Products and any goods or services identified
      by the Marks. Such goods and services may be licensed, sampled, sold, or
      marketed in any and all locations and venues, and through any method or
      channel of distribution Franchisor deems appropriate in its sole
      discretion (including wholesale distribution of Products to supermarkets,
      grocery stores, convenience stores, and other retail outlets). Such sales
      may be in direct competition with the FACILITY, without regard to any
      adverse effect on the FACILITY and without any obligation or liability to
      Franchisee.
	  
	6.	SITE
      SELECTION
	 
	6.1	Franchisee
      acknowledges that, prior to signing this Agreement, Franchisee (with or
      without Franchisor assistance) located, and Franchisor approved, the Site.
      Franchisee acknowledges and agrees that Franchisor’s recommendation or
      approval of the Site, and any information regarding the Site communicated
      to Franchisee, do not constitute any acknowledgement, warranty or
      representation of any kind, express or implied, including any warranty or
      representation as to the potential access, visibility or profitability of
      a Commissary Facility at that Site, or for any other purpose. Franchisor’s
      approval of the Site merely signifies that Franchisor is willing to grant
      a Franchise for a Commissary Facility at that location. Application of
      criteria that have appeared effective with respect to other sites may not
      accurately reflect the potential for all sites, and, after Franchisor’s
      approval of a site, demographic and/ or other factors included in or
      excluded from Franchisor’s criteria could change, thereby altering the
      potential of a site. The uncertainty and instability of such criteria are
      beyond Franchisor’s control, and Franchisor will not be responsible for
      the failure of a site Franchisor has recommended or approved to meet
      expectations as to potential revenue or operational criteria. Neither
      Franchisor’s approval of the Site nor any assistance Franchisor may give
      Franchisee in identifying the Site, constitutes a warranty or
      representation of any kind, express or implied, as to the suitability of
      the proposed Site for a Commissary Facility or for any other purpose.
      Franchisee’s decision to develop and operate the FACILITY at the Site is
      based solely on Franchisee’s own independent investigation of the
      suitability of the Site for a Commissary Facility.
	 
	6.2	Franchisee must also
      cause to be prepared, and submit for approval by Franchisor, a site plan
      and basic plans and specifications for the FACILITY, including
      requirements for dimensions, exterior design, materials, interior layout,
      equipment, fixtures, furniture, signs and decorating. Franchisor’s
      exercise of its right to approve the Site layout, to approve any plans, to
      inspect the construction or conversion of the FACILITY shall be solely for
      the purpose of assuring compliance with the System Standards and shall not
      be construed as any express or implied representation or warranty that the
      FACILITY complies with any

D-12

	 	applicable
      laws, codes or regulations (including the Americans with Disabilities Act
      (“ADA”) or any other federal, state, or local law or ordinance regulating
      standards for the access to, use of, or modification of buildings for and
      by persons whose disabilities are protected by law) or that the
      construction thereof is sound or free from defects. Franchisor’s criteria
      for approval or disapproval do not encompass technical, architectural or
      engineering considerations. Franchisor shall have no liability or
      obligation with respect to the construction or conversion of the
      FACILITY.
	              	              	 
	7.	LEASE OR
      PURCHASE OF SITE
	 
	7.1	Franchisee
      must lease, sublease or purchase the Site within one-hundred and eighty
      (180) days after the date of Franchisor’s site acceptance letter.
      Franchisor has the right to approve the terms of any lease, sublease or
      purchase contract for the Site, and Franchisee agrees to deliver a copy to
      Franchisor for Franchisor’s approval before Franchisee signs it.
      Franchisee agrees that any lease or sublease for the Site must, in form
      and substance satisfactory to Franchisor, (a) provide for notice to
      Franchisor of Franchisee’s default under the lease or sublease and an
      opportunity for Franchisor to cure such default; (b) require the lessor or
      sublessor to disclose to Franchisor, on its request, sales and other
      information furnished by Franchisee; (c) give Franchisor the right on any
      termination or expiration (without renewal) of this Agreement to assume
      the lease or sublease without the lessor’s or sublessor’s consent; (d)
      give Franchisor the right to enter the FACILITY to remove signs and other
      tangible property that embodies any of the Marks or that contains or
      embodies patents owned by Franchisor or any of its Affiliates, and provide
      that the lessor and/or sublessor relinquishes to Franchisor, on any
      termination or expiration (without renewal) of this Agreement, any lien or
      other ownership interest, whether by operation of law or otherwise, in and
      to any tangible property, including any outdoor sign, that embodies any of
      the Marks; and (e) require that the lessor and/or sublessor acknowledges
      that Franchisor has no liability or obligation whatsoever under the lease
      or sublease until and unless Franchisor assumes the lease or sublease on
      termination or expiration of this Agreement.
	 
	 	Franchisee
      may not execute a lease, sublease or purchase contract pertaining to the
      Site for the FACILITY or any modification thereof without Franchisor’s
      approval. Franchisor’s approval of the lease, sublease or purchase
      contract does not constitute a warranty or representation of any kind,
      express or implied, as to its fairness or suitability or as to
      Franchisee’s ability to comply with its terms. Franchisor does not, by
      virtue of approving the lease, sublease or purchase contract, assume any
      liability or responsibility to Franchisee or to any third parties.
      Franchisee must deliver a copy of the fully signed lease, sublease or
      purchase contract to Franchisor within five (5) days after its
      execution.
	 
	8.	FACILITY
      DEVELOPMENT
	 
	8.1	Franchisee
      is responsible for developing the FACILITY. Franchisee is obligated to
      have prepared all required construction plans and specifications to suit
      the shape and dimensions of the Site and to insure that such plans and
      specifications comply with all applicable state, federal, and local laws,
      codes, ordinances, regulations (including building codes, permit
      requirements, and regulations and the ADA or similar rules governing
      accommodations for persons with disabilities). Franchisee is obligated to
      submit construction plans and specifications to Franchisor for approval
      before construction of the FACILITY is commenced and, at Franchisor’s
      request, to submit all revised plans and specifications during the course
      of such construction with “as built” plans to be provided upon completion.
      Franchisor may be willing to assist Franchisee in developing the FACILITY
      by recommending engineers and architects and otherwise furnishing
      information to assist Franchisee in developing the FACILITY in accordance
      with Franchisor’s specifications.
	 
	8.2	Franchisee
      agrees, at its own expense, to do the following with respect to developing
      the FACILITY at the Site:
	 
	 	(a)	secure all financing
      required to develop and operate the FACILITY;
	 
	 	(b)	obtain all building,
      utility, sign, health, sanitation, business and other permits and licenses
      required to construct and operate the FACILITY;

D-13

	 	(c)	construct all required
      improvements to the Site and decorate the FACILITY in compliance with
      plans and specifications and designs Franchisor has approved;
	              	              	 
	 	(d)	purchase or lease and
      install all required equipment, fixtures, furnishings, and signs required
      for the FACILITY; and
	 
	 	(e)	purchase an opening
      inventory of authorized and approved materials and supplies, certain of
      which items must be purchased from Franchisor, its Affiliates, or
      suppliers designated by Franchisor, all as described in the System
      Standards Manuals.
	 
	8.3	Franchisee
      acknowledges that Franchisor is not responsible for, and shall have no
      liability for, the architecture, design, engineering, or construction of
      the FACILITY, for the FACILITY’s compliance with any federal, state, or
      local law (including the ADA and any other federal, state or local law or
      ordinance regulating standards for access to, use of the, or modification
      of buildings for and by persons who are protected by law by virtue of such
      disability or whose disabilities are otherwise recognized by law), for any
      errors, omissions or discrepancies of any nature in any drawings or
      specifications with respect to the FACILITY, or for any other matter
      relating to the development, use or operation of the FACILITY, even if
      Franchisor assists in the development of the FACILITY.
	 
	9.	BUILDING,
      EQUIPMENT, FIXTURES, FURNISHINGS, SIGNS AND SUPPLIES
	 
	9.1	Franchisee
      acknowledges that the Products, Marks, and System have established
      significant prestige and goodwill and are well-recognized in the mind of
      the public and the trade. In order to preserve such prestige and goodwill,
      Franchisee understands and agrees that it is necessary and appropriate for
      Franchisor to closely control the supply chain for all equipment
      (including production equipment and fixtures, cash register, POS system
      and computer), fixtures, furnishings, signs, delivery vehicles, raw
      materials (including doughnut mixes and coffee beans), supplies, and any
      other items used or useful in developing or operating the FACILITY or
      producing, marketing, or selling the Products or other goods Franchisor
      requires Franchisee to sell.
	 
	9.2	Franchisee
      agrees to use in developing and operating the FACILITY (and producing,
      marketing, and selling the Products and other goods Franchisor requires
      Franchisee to sell) only the equipment, fixtures, furnishings, signs,
      delivery vehicles, raw materials, supplies, cash register, POS system, and
      computers and other items that Franchisor has approved from time to time
      for Franchisee to use in conjunction with the FACILITY as meeting its
      specifications and standards for quality, design, appearance, function and
      performance in accordance with the System Standards. Any deviation from
      Franchisor’s mandatory specifications and standards as prescribed by the
      System Standards must receive prior written approval from Franchisor.
      Approval of any item for use by Franchisor, its Affiliates, or other
      developers or franchisees will not be construed as approval of such item
      for Franchisee’s use.
	 
	9.3	Notwithstanding Section 9.2, Franchisor may require
      Franchisee to purchase any or all of the equipment, fixtures, furnishings,
      signs, delivery vehicles, raw materials, supplies, and other items for the
      FACILITY directly from Franchisor or its Affiliates or other suppliers it
      may designate from time to time. Franchisee agrees to purchase all such
      items from Franchisor, its Affiliates or designated suppliers, as
      Franchisor may require. Franchisee acknowledges and agrees that
      Franchisor, its Affiliates and designated suppliers have the right to
      profit from the sale of such items and that Franchisor does not act as
      agent, representative or in any other intermediary or fiduciary capacity
      for Franchisee in Franchisor’s relationship with any designated suppliers.
      Franchisee acknowledges and agrees that (a) Franchisor and/ or its
      Affiliates may receive payments, fees, commission or reimbursements from
      designated suppliers and third parties in respect to such purchases, (b)
      Franchisor and/or its Affiliates may have investments in designated
      suppliers, and (c) Franchisor and/or its Affiliates may profit from
      Franchisee’s purchases from designated suppliers. Franchisor, its
      Affiliates and designated suppliers shall not be liable for any delay in
      the delivery of ingredients as a result of any Force Majeure. Franchisor,
      its Affiliates and designated suppliers may establish policies and
      procedures from time to time for the allocation and distribution of items
      among Krispy Kreme Stores and Commissary
Facilities.

D-14

	9.4	All equipment
      (including production equipment), fixtures, furnishings, raw materials
      (including doughnut mixes and coffee beans) that Franchisee purchases from
      Franchisor, its Affiliates or designated suppliers shall be at such prices
      and on such purchase terms (including credit, such as COD, and shipping)
      and conditions as Franchisor, its Affiliates or designated suppliers may
      determine from time to time. EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN
      ANY PURCHASE ORDER ISSUED BY FRANCHISOR OR ITS AFFILIATES OR DESIGNATED
      SUPPLIERS, NEITHER FRANCHISOR, ANY OF ITS AFFILIATES NOR ANY DESIGNATED
      SUPPLIER MAKES ANY WARRANTY OR REPRESENTATION, EXPRESS OR IMPLIED, AS TO
      MERCHANTABILITY, FITNESS FOR PARTICULAR PURPOSE OR OTHERWISE WITH RESPECT
      ANY ITEMS FRANCHISEE IS REQUIRED TO PURCHASE FROM ANY OF THEM. NEITHER
      FRANCHISOR, ANY OF ITS AFFILIATES NOR ANY DESIGNATED SUPPLIER WILL HAVE
      ANY LIABILITY FOR SPECIAL, INCIDENTAL, CONSEQUENTIAL OR PUNITIVE DAMAGES
      IN CONNECTION WITH ANY SUCH ITEMS, INCLUDING FRANCHISEE’S PURCHASE, USE OR
      RESALE OF ANY SUCH ITEMS.
	              
    	
	9.5	In the event
      Franchisor does not require Franchisee to purchase a particular item from
      Franchisor, its Affiliates, or a designated supplier, Franchisee may
      purchase such item from a supplier Franchisor has approved. If Franchisee
      proposes to purchase any such item from any supplier who is not then
      approved by Franchisor, Franchisee and the proposed supplier must submit
      to Franchisor all information that Franchisor may request in order to
      determine whether to approve the supplier. Franchisor will have the
      unconditional right to approve or disapprove any proposed supplier, and
      Franchisor may approve a supplier conditionally. Within one thirty (30)
      days after Franchisor receives all requested information, Franchisor will
      communicate to Franchisee in writing Franchisor’s decision to approve or
      disapprove Franchisee’s proposed supplier. Franchisor will evaluate
      proposed suppliers on their ability to comply with applicable standards,
      specifications and procedures, and Franchisor will only approve those
      proposed suppliers that meet Franchisor’s high standards. Franchisor may
      disapprove any supplier who Franchisor previously approved, and Franchisee
      may not, after receipt of notice of disapproval, reorder from any supplier
      Franchisor has disapproved. Franchisor may prescribe procedures for the
      submission of requests for approval and impose obligations on approved
      suppliers, which will be incorporated in a written license agreement with
      the supplier. Franchisor may obtain from Franchisee and/or such approved
      suppliers reimbursement of Franchisor’s reasonable costs and expenses
      incurred in connection with the approval process of the supplier’s
      compliance with Franchisor’s requirements. Franchisee acknowledges and
      agrees that Franchisor does not act as agent, representative or in any
      other intermediary or fiduciary capacity for Franchisee in Franchisor’s
      relationship with approved suppliers. Franchisor may impose limits on the
      number of approved suppliers. Franchisor has the right to monitor the
      quality of services provided by approved suppliers in a manner Franchisor
      deems appropriate and may terminate any approved supplier that does not
      meet Franchisor’s quality standards and specifications, as may be in
      effect from time to time.
	  
	9.6	Franchisee agrees to
      place or display at the Sites (interior and exterior) only such signs,
      emblems, lettering, logos, and display materials that Franchisor approves
      from time to time.
	 
	10.	COMPUTER
      SYSTEM
	 
	10.1	Franchisee agrees to
      use in the development and operation of the FACILITY the POS, cash
      register/ computer terminals and operating software (“Computer System”)
      that Franchisor specifies from time to time. Franchisee agrees to install
      and use at the FACILITY the Computer System that Franchisor specifies from
      time to time and to transmit to Franchisor (and otherwise permit
      Franchisor to collect) in the form and at frequencies it specifies from
      time to time, electronic information from the Computer System. Franchisee
      also agrees to identify Product categories and other items in the Computer
      System in a form that Franchisor specifies. Franchisee agrees to install
      and maintain at the FACILITY a DSL or cable modem, or similar means of
      networking, and dedicated line that Franchisor may use to access sales
      information and other data on the Computer System. Franchisee is
      responsible for maintaining a secure network environment consistent with
      this Agreement and all applicable legal
requirements.

D-15

	10.2	Franchisee
      acknowledges that Franchisor has developed specifications for certain
      components of the Computer System and may modify such specifications and
      the components of the Computer System from time to time. As part of the
      Computer System, Franchisor may require Franchisee to obtain specified
      computer hardware and/or software, including a license to use proprietary
      software developed by Franchisor or others. Franchisor’s modification of
      such specifications for the components of the Computer System may require
      Franchisee to incur costs to purchase, lease and/or license new or
      modified computer hardware and/or software and to obtain service and
      support for the Computer System during the term of this Agreement.
      Franchisee acknowledges that Franchisor cannot estimate the future costs
      of the Computer System (or additions or modifications thereto) and that
      the cost to Franchisee of obtaining the Computer System (including
      software licenses) (or additions or modification thereto) may not be fully
      amortizable over the remaining term of this Agreement. Within sixty (60)
      days after Franchisee receives notice from Franchisor, Franchisee agrees
      to obtain the components of the Computer System that Franchisor designates
      and requires.
	              	              	 
	10.3	Franchisee
      further acknowledges and agrees that Franchisor has the right to charge a
      reasonable systems fee for software or systems, modifications and
      enhancements specifically made for Franchisor that are licensed to
      Franchisee and other maintenance and support services that Franchisor or
      its Affiliates furnish to Franchisee related to the Computer
    System.
	 
	11.	FACILITY
      OPENING
	 
	11.1	Franchisee
      agrees not to open the FACILITY for business until:
	 
	 	(a)	Franchisor approves
      the FACILITY and site plan as developed in accordance with Franchisor’s
      specifications and System Standards;
	 
	 	(b)	All required training
      has been completed to Franchisor’s satisfaction;
	 
	 	(c)	Franchisee is in
      compliance with all Franchise Agreements, Development Agreements, and
      Commissary Facility Agreements, including the payment of all amounts then
      due to Franchisor;
	 
	 	(d)	Franchisor has been
      furnished with copies of all insurance policies required by this
      Agreement, or such other evidence of insurance coverage and payment of
      premiums as Franchisor requests or accepts; and
	 
	 	(e)	Other items which
      Franchisor may reasonably require have been furnished to
    Franchisor.
	 
	11.2	Franchisee
      must properly staff the FACILITY prior to opening. Franchisor will supply
      at no charge an operating team that will assist Franchisee for a minimum
      of seven (7) days in the opening of the FACILITY. However, if Franchisee
      is developing several Krispy Kreme Stores or Commissary Facilities
      pursuant to a Development Agreement, this team will be made available at
      no charge for the first Krispy Kreme Store or Commissary Facility,
      one-half of a team will be made available at no charge for the second
      Krispy Kreme Store or Commissary Facility, a field consultant will be made
      available at no charge for the third Krispy Kreme Store or Commissary
      Facility and a field consultant may or may not be made available at no
      charge for any subsequent Krispy Kreme Stores or Commissary Facilities, at
      Franchisor’s sole discretion. “No charge” means Franchisor will be
      responsible for the team’s travel, room and board, and salaries, but
      Franchisee will be responsible for all other charges or
  expenses.
	 
	12.	CAPITAL
      IMPROVEMENTS
	 
	12.1	In addition
      to the requirements of Section 10 pertaining to the Computer
      System, Franchisor may, from time to time, require Franchisee to make
      certain capital improvements with respect to developing or operating the
      FACILITY, including: (a) the acquisition of new equipment (whether for the
      Products or other goods Franchisor requires Franchisee to sell or
      otherwise), fixtures, furnishings, signs, delivery vehicles, or other
      fixed assets; (b) periodic remodeling; and (c) replacement of obsolete or
      worn-out improvements, equipment, fixtures, furnishings, signs, delivery
      vehicles, or other fixed assets (“Capital Improvements”). Franchisee
      agrees to make such Capital Improvements as Franchisor may specify from
      time to time in Franchisor’s sole discretion. Franchisee agrees not to
      make any modifications to any

D-16

	 	required Capital Improvements
      without Franchisor’s prior written approval. Franchisee further agrees
      that all intellectual property rights to any such Capital Improvements, if
      applicable, will be the exclusive property of Franchisor or its
      Affiliates.
	 
	13.	ROYALTIES
	              
    	 
	13.1	[THIS SECTION HAS BEEN
      INTENTIONALLY DELETED]
	 
	13.2	On or before the Payment Day each
      Week, Franchisee will pay Franchisor an amount equal to the following
      percentage of Net Sales (“Royalties”) for the preceding Week: three and
      one-half percent (31⁄2%) of Net Sales incurred during 2008; two and one-half percent
      (21⁄2%) of Net
      Sales incurred during 2009; and one percent (1%) of Net Sales incurred
      during 2010 and thereafter. On or before the Reporting Day each Week,
      Franchisee will report to Franchisor, in the form it may require from time
      to time, the true and correct Net Sales of the FACILITY for the preceding
      Week.
	 
	13.3	Franchisee agrees to give
      Franchisor authorization, in the form that Franchisor designates from time
      to time (the current from is attached as Exhibit D), for direct debits
      from, or credits to, the Account. Franchisee shall not close the Account
      (or allow the Account to be closed) without first opening and notifying
      Franchisor of an alternate Account, nor shall Franchisee terminate any
      direct debit authorization from the Account without a replacement
      authorization approved by Franchisor. Franchisee hereby authorizes
      Franchisor to initiate debit entries and/or credit entries to the Account
      for payments of Royalties and other amounts payable under this Agreement,
      including purchases for production equipment, fixtures, furnishings,
      doughnut mixes and other ingredients, packaging and all supplies purchased
      from Franchisor and any interest charges due thereon. Franchisee agrees to
      make the funds available in the Account for withdrawal no later than the
      due date for payment. The amount actually transferred from the Account to
      pay Royalties will be based on the FACILITY’s Net Sales reported to
      Franchisor or determined by Franchisor from the records contained in the
      cash register/computer terminals of the FACILITY. If Franchisee has not
      reported Net Sales of the FACILITY to Franchisor for any reporting period
      as required above, Franchisee hereby authorizes Franchisor to debit the
      Account in an estimated amount based on prior reports of Net
    Sales.
	 
	13.4	If at any time Franchisor
      determines that Franchisee has under-reported the Net Sales of the
      FACILITY, or underpaid Royalties or any other amounts due to Franchisor
      under this Agreement, Franchisee hereby authorizes Franchisor to initiate
      immediately a debit to the Account in the appropriate amount, including
      interest as provided for in this Agreement. Any overpayment will be
      credited to the Account through a credit effective as of the first
      reporting date after Franchisor and Franchisee determine that such credit
      is due. 
	 
	13.5	All amounts that Franchisee owes
      Franchisor will bear interest after their due date at the rate of one and
      one-half percent (1.5%) per month or the highest contract rate of interest
      permitted by law, whichever is less. Franchisee acknowledges that this
      Section does not constitute Franchisor’s agreement to accept any payments
      after they are due or Franchisor’s commitment to extend credit to, or
      otherwise finance Franchisee’s operation of, the FACILITY. Franchisee’s
      failure to pay all amounts when due constitutes a material breach and
      grounds for termination of this Agreement, as provided in Section 26 hereof,
      notwithstanding the provisions of this Section 13.5.
	 
	13.6	Notwithstanding any designation
      Franchisee might make, Franchisor has sole discretion to apply any of
      Franchisee’s payments to any of its past due indebtedness to Franchisor in
      any sequence. Franchisee acknowledges and agrees that Franchisee has no
      right to set off any amounts that Franchisee claims Franchisor owes
      Franchisee against Royalties, Brand Fund contributions, payments for
      purchases, or any other amounts Franchisee owes Franchisor under this
      Agreement or otherwise. 
	 
	14.	TRAINING AND
      GUIDANCE 
	 
	14.1	Before the FACILITY begins
      operating, Franchisor will furnish training on the operation of a
      Commissary Facility as follows. Franchisor will furnish a training program
      for up to two (2) FACILITY managers furnished at Franchisor’s designated
      training facility and/or at an operating
Commissary

D-17

	 	Facility, at Franchisor’s
      discretion. The FACILITY managers are required to complete training to
      Franchisor’s satisfaction. Although Franchisor will furnish training to
      these managers of the FACILITY at no additional fee or other charge,
      Franchisee will be responsible for the managers’ wages, salaries, travel,
      room and board, and living expenses during training. Franchisee agrees to
      replace a manager immediately if Franchisor determines that he or she is
      not qualified to serve in this capacity at the FACILITY. Franchisor will
      furnish the same training program to one (1) additional manager of the
      FACILITY per year that Franchisee hires after the FACILITY is open,
      without fee or other charge, subject to the schedules for the training
      program in effect from time to time. Franchisee will be responsible for
      the managers’ wages, salaries, travel, room and board, and living expenses
      during training.
	              
    	
	14.2	Franchisor may require managers
      of the FACILITY to attend and successfully complete periodic or additional
      training programs, and Franchisor may also offer optional training
      programs. Except as provided in Section
      14.1, Franchisor has the right to
      charge reasonable fees for providing any such initial, periodic or
      additional training programs. Franchisee will be responsible for the
      managers’ wages, salaries, travel, room and board, and living expenses
      during incurred by Franchisee and Franchisee’s personnel in attending any
      training programs. Franchisee shall immediately replace any managers who
      fail to successfully complete any training program.
	 
	14.3	Franchisor will furnish
      Franchisee periodic guidance with respect to the System, including
      improvements and changes to the System. Such guidance, at Franchisor’s
      discretion, will be furnished in the form of the System Standards Manuals,
      bulletins and other written materials, consultations by telephone or in
      person at Franchisor’s offices or at the FACILITY, or by any other means
      of communications. At Franchisee’s request, Franchisor may provide special
      assistance for which Franchisee will be required to pay the fees and
      charges Franchisor may establish from time to time. If Franchisee requests
      or Franchisor requires additional or special training for Franchisee’s
      employees, all of the expenses that Franchisor incurs in connection with
      such training, including per diem charges and travel and living expenses
      for Franchisor’s personnel, will be Franchisee’s
  responsibility.
	 
	15.	SYSTEM
  STANDARDS
	 
	15.1	Franchisor will loan Franchisee
      one (1) copy of its System Standards Manuals solely for use in operating
      the FACILITY during the Term. The System Standards Manuals at all times
      will remain Franchisor’s property, and they are protected by copyright.
      Franchisee will keep its copy of the System Standards Manuals current and
      in a secure location at the FACILITY and shall return them to Franchisor
      immediately upon request, upon termination, or expiration of this
      Agreement or upon any Transfer. If any copies of the System Standards
      Manuals in Franchisee’s possession are lost, destroyed or significantly
      damaged, Franchisee will obtain a replacement copy at Franchisor’s then
      applicable charge. Franchisee may not at any time copy, duplicate, record,
      or otherwise reproduce any part of the System Standards Manuals or allow
      any unauthorized persons access to any System Standards Manuals, including
      those that are made available electronically, nor may Franchisee post all
      or any part of the System Standards Manuals on any limited access intranet
      sites without Franchisor’s approval. Franchisee may not distribute any
      part of the System Standards Manuals and may not disclose any part of the
      System Standards Manuals to any person, other than its employees who have
      a need to know the contents of the System Standards Manuals in order to
      perform their jobs.
	 
	15.2	During the Term, Franchisee will
      comply with all of the System Standards and other requirements contained
      in System Standards Manuals, in addition to all applicable laws,
      regulations, rules, by-laws, orders and ordinances in connection with its
      operation of the FACILITY. In the event of a dispute relating to the
      contents of the System Standards Manuals, the master copy of the System
      Standards Manuals maintained by Franchisor at its principal office is
      controlling. Franchisor may at any time and from time to time change the
      System Standards Manuals to reflect changes in System
  Standards.
	 
	15.3	To determine whether Franchisee
      is in compliance with this Agreement and all System Standards, Franchisor
      and/or Franchisor’s agents have the right at any time during regular
      business hours, and without prior notice to Franchisee, to: (a) inspect
      the FACILITY; (b) observe, photograph and
videotape

D-18

	 	the operations of the FACILITY;
      (c) remove samples of any Products, materials or supplies for testing and
      analysis; (d) interview personnel of the FACILITY; (e) interview customers
      of the FACILITY and to require Franchisee to present to Franchisee
      customers any evaluation forms periodically prescribed by Franchisor and
      to participate in and/or request its customers to participate in any
      surveys performed by or on behalf of Franchisor; and (f) inspect and copy
      any books, records and documents relating to the operation of the
      FACILITY.
	              
    	
	16.	MARKS
	 
	16.1	Franchisee acknowledges that HDN
      Development Corporation is the Owner of the Marks and that Franchisor has
      the right to sublicense the use of the Marks. Franchisee further
      acknowledges that Franchisee’s right to use the Marks is derived solely
      from this Agreement and is limited to the performance of Franchisee’s
      responsibilities and obligations hereunder in accordance with the terms
      hereof. Franchisee acknowledges that its unauthorized use of any of the
      Marks will constitute a material breach of this Agreement, warranting
      immediate termination of this Agreement by Franchisor at Franchisor’s
      election. Franchisee acknowledges and agrees that its usage of the Marks
      and any goodwill established thereby shall inure solely to the benefit of
      the Owner of the Marks and that this Agreement does not confer any
      goodwill or other interests in any of the Marks upon Franchisee or
      Franchisee’s Owners (other than the rights specifically granted by this
      Agreement). All provisions of this Agreement applicable to the Marks apply
      to any additional trademarks, service marks, logos, trade dress and
      commercial symbols Franchisor authorizes Franchisee to use. Franchisee may
      not at any time during or after the Term contest, or assist any other
      person in contesting, the validity or ownership of any of the
    Marks.
	 
	16.2	Franchisee shall use the Marks as
      the sole brand and other source identifier of the FACILITY, provided
      Franchisee shall identify itself as the independent owner and operator of
      the FACILITY in the manner Franchisor prescribes. Franchisee shall use the
      Marks only as Franchisor prescribes or allows in writing, whether in
      connection with the sale of Products and the operation of the FACILITY, or
      otherwise.
	 
	16.3	Franchisee and Franchisee’s
      Owners, affiliates and agents may not: (a) challenge the validity of any
      of the Marks or any registration or application for registration
      therefore, or attempt to claim ownership of or to register anywhere any of
      the Marks or any derivation or colorable imitation thereof; (b) attempt to
      claim ownership of or to register anywhere any trademark, service mark,
      trade name, or trade dress confusingly similar to any of the Marks; (c)
      use any of the Marks or any other trademark or trade dress confusingly
      similar thereto in any manner that would jeopardize or Franchisor’s rights
      in the Marks; or (d) do any act that would invalidate registration for any
      of the Marks. Franchisee may not use any of the Marks as part of any
      corporate or legal business name or with any prefix, suffix or other
      modifying words, terms, designs or symbols (other than logos licensed to
      Franchisee hereunder), or in any modified form, nor may Franchisee use any
      of the Marks in connection with the performance or sale of any
      unauthorized products or services or in any other manner Franchisor has
      not expressly authorized in writing. Franchisee agrees to display the
      Marks prominently in the manner Franchisor prescribes, including at the
      FACILITY, on packaging and serving materials that Franchisor designates
      and in connection with forms and advertising and marketing materials.
      Franchisee agrees to give such notices of trademark and service mark
      registrations and such other trademark and service mark notices as
      Franchisor specifies and to obtain any fictitious or assumed name
      registrations required under applicable law.
	 
	16.4	Franchisee agrees to notify
      Franchisor immediately of any apparent infringement of, or challenge to,
      any of the Marks, or of any claim by any Person of any rights in any of
      the Marks, and Franchisee agrees not to communicate with any Person other
      than Franchisor, Franchisor’s attorneys and Franchisee’s attorneys in
      connection with any such apparent infringement, challenge or claim.
      Franchisor has sole discretion to take such action as Franchisor deems
      appropriate and the right to control exclusively any litigation, U.S.
      Patent and Trademark Office proceeding or any other proceeding arising out
      of any such apparent infringement, challenge or claim or otherwise
      relating to any of the Marks, including the exclusive right to utilize
      counsel of Franchisor’s choice to prosecute or defend any such litigation
      or proceeding. Any award recovered in any such action or proceeding shall
      belong exclusively to Franchisor, or, as

D-19

	 	appropriate, Franchisor’s
      Affiliates. Franchisee agrees to sign any and all instruments and
      documents, render such assistance and do such acts and things as, in the
      opinion of Franchisor and/or Franchisor’s attorneys, may be necessary or
      advisable to protect and maintain Franchisor’s interests in any litigation
      or U.S. Patent and Trademark Office proceeding or other proceeding or
      otherwise to protect and maintain Franchisor’s interests in the
      Marks.
	              
    	
	16.5	Franchisee may not register, or
      attempt to register, any of the Marks as part of any Internet domain name
      or URL, and may neither display nor use any of the Marks or other of
      Franchisor’s or its Affiliates’ intellectual property in connection with,
      or associate the System with (through a link or otherwise) any website
      advertising, address or listing on the World Wide Web or any other portion
      of the Internet without Franchisor’s prior written consent.
	 
	16.6	Franchisee may not use any of the
      Marks to incur any obligation or indebtedness on behalf of Franchisor or
      its Affiliates.
	 
	16.7	Franchisee hereby assigns to
      Franchisor all tangible media of expression derived from any of the Marks,
      and agrees to execute such further assignments as Franchisor may request.
      Franchisee shall take all actions and sign all documents necessary to give
      effect to the purpose and intent of this Section 16. Franchisee
      irrevocably appoints Franchisor as the true and lawful attorney-in-fact
      for Franchisee and authorizes Franchisor to take such actions and to
      execute, acknowledge and deliver all such documents as may from time to
      time be necessary to convey to Franchisor all rights granted by this
      Agreement.
	 
	16.8	Franchisor may, in its sole
      discretion, modify or discontinue the use of any of the Marks and/or to
      use one or more additional or substitute trademarks or service marks.
      Franchisee agrees to comply with Franchisor’s directions with regard to
      such modification, discontinuance, addition, or substitution of use of any
      Mark. Franchisor will not be obligated to reimburse Franchisee for any
      expense or loss of revenue related thereto.
	 
	16.9	Franchisee acknowledges that the
      Marks have established prestige and goodwill and are well recognized in
      the mind of the public and the trade, and that it is of great importance
      to Franchisor that the high standards and reputation symbolized by the
      Marks be maintained in the manufacture, marketing, and sale of the various
      Products and other authorized goods bearing and services utilizing the
      Marks. Accordingly, all items of Products manufactured, marketed, or sold,
      and services rendered, by Franchisee pursuant to this Agreement shall be
      of high quality as determined by Franchisor in its sole discretion. They
      shall be suitable for the exploitation of the Marks to the best advantage
      and the protection and enhancement of the Marks and the goodwill
      associated therewith. Franchisor shall have the right to, and shall,
      exercise quality control over Franchisee’s use of the Marks to the degree
      reasonably necessary to maintain the validity thereof and to protect the
      goodwill associated therewith, including but not limited to the right to
      inspect and monitor Franchisee’s use of the Marks in any manner and time
      prescribed by Franchisor.
	 
	17.	CONFIDENTIAL
      INFORMATION
	 
	17.1	Franchisor will disclose to
      Franchisee such parts of the Confidential Information as Franchisor deems
      necessary or advisable from time to time for the performance of
      Franchisee’s obligations under this Agreement. Franchisee acknowledges and
      agrees that Franchisee and its Owners and Affiliates will not acquire any
      interest in or right to use the Confidential Information, other than the
      right to use it in the performance of Franchisee’s obligations under this
      Agreement, and that the use or duplication of the Confidential Information
      in any other business would constitute an unfair method of competition
      with Franchisor and with other developers and Franchisees of Krispy Kreme
      Stores. Franchisee agrees to disclose the Confidential Information to
      Franchisee’s Owners and to Franchisee’s employees only to the extent
      reasonably necessary for the performance of Franchisee obligations under
      this Agreement. Franchisee’s Owners must execute the form of Investor
      Personal Covenants Regarding Confidentiality, Non-Competition and
      Non-Solicitation attached hereto as Exhibit
      C.

D-20

	17.2	Franchisee acknowledges
      and agrees that the Confidential Information is confidential, is
      Franchisor’s proprietary and valuable asset, includes trade secrets owned
      by Franchisor and Franchisor Affiliates and is disclosed to Franchisee
      solely on the condition that Franchisee, Franchisee’s Owners and employees
      who have access to the Confidential Information agree, and Franchisee
      agrees that, during and after the Term, Franchisee, Franchisee’s Owners,
      Franchisee’s Affiliates and Franchisee’s employees:
	              
    	              
    	
	 	(a)	will not use Confidential
      Information in any other business or capacity;
	 
	 	(b)	will maintain the absolute
      confidentiality of Confidential Information during and after the
      Term;
	 
	 	(c) 	will not make unauthorized copies
      of any portion of Confidential Information whether through electronic
      media, writings, or other tangible or intangible means of expression;
      and
	 
	 	(d)	will adopt and implement all
      reasonable procedures that Franchisor prescribes from time to time to
      prevent unauthorized use or disclosure of Confidential Information,
      including restrictions on disclosure thereof to FACILITY personnel and
      others.
	 
	 	Without limiting the
      foregoing, Franchisee, and each of its Owners, as applicable, each (i)
      acknowledge the possibility that they may gain access to Franchisor’s
      material non-public information and/or that of Franchisor’s parent
      company, Krispy Kreme Doughnuts, Inc. (“KKDI”), and that the securities
      laws prohibit trading in KKDI securities while in possession of such
      information, and (ii) agree to refrain from trading in KKDI securities in
      violation of such laws.
	 
	17.3	Notwithstanding
      anything to the contrary contained in this Agreement and provided
      Franchisee has obtained Franchisor’s prior written consent, the
      restrictions on Franchisee disclosure and use of the Confidential
      Information will not apply to the following:
	 
	 	(a)	information, methods, procedures,
      techniques and knowledge which are or become generally known in the food
      service business, other than through disclosure (whether deliberate or
      inadvertent) by Franchisee, Franchisee’s Owners, agents, or employees;
      and
	 
	 	(b)	the disclosure of the
      Confidential Information in judicial, arbitration or administrative
      proceedings to the extent that Franchisee is legally compelled to disclose
      such information, provided Franchisee has notified Franchisor prior to
      such disclosure and has used Franchisee’s best efforts to obtain, and has
      afforded Franchisor sufficient opportunity to seek an appropriate
      protective order and obtain, assurances satisfactory to Franchisor of
      confidential treatment for the information required to be so
      disclosed.
	 
	18.	PATENTS AND
      INVENTIONS
	 
	18.1	Franchisor and/or its
      Affiliates have obtained certain patent protection and may seek additional
      patent protections for other aspects of the System, the Products, and/or
      other technology related to the development and operation of Krispy Kreme
      Stores and Commissary Facilities and the production, marketing, and sale
      of the Products, or otherwise, including all improvements thereto. Nothing
      in this Agreement shall be construed as transferring ownership of any
      patents or patent applications from Franchisor or its Affiliates to
      Franchisee. Nothing in this Agreement shall be construed as transferring
      the right to sublicense any patents or patent applications from Franchisor
      or its Affiliates to Franchisee.
	 
	18.2	Franchisee agrees to
      promptly disclose to Franchisor and/or its Affiliates, and Franchisee
      agrees not to disclose to any other Person or permit any other Person to
      use (absent Franchisor’s prior written consent), any and all inventions
      (which term “inventions” includes any invention, idea, concept, method,
      technique, material, design, discovery, know-how, development,
      improvement, product, process, or innovation), including all improvements
      thereto, which are developed by Franchisee, Franchisee’s Owners, or
      Franchisee’s Affiliates, whether or not constituting protectable
      intellectual property, which are in any way related to the System, the
      Products, the development or operation of Krispy Kreme Stores or
      Commissary Facilities, or the production, marketing, or sale of the
      Products.

D-21

	18.3	Franchisee hereby agrees to
      assign, and does assign, to Franchisor and/or the Affiliates Franchisor
      designates all right, title, and interest in any invention, patent
      application, or patent conceived of or reduced to practice which is in any
      way related to the System, the Products, the development or operation of
      Krispy Kreme Stores or Commissary Facilities, or the production,
      marketing, or sale of the Products. Franchisor will have no obligation to
      make payments to Franchisee or any other Person with respect to any such
      assignments. Franchisee agrees that all such inventions, patent
      applications, and patents referenced above shall belong to Franchisor
      and/or Franchisor’s Affiliates, and that all right, title, and interest
      therein shall be the sole and exclusive property of Franchisor and/or
      Franchisor’s Affiliates, except that Franchisee shall be entitled to use
      all such inventions without charge by Franchisor in connection with this
      Agreement for the Term.
	              
    	
	18.4	Franchisee agrees to assist
      Franchisor and/or Franchisor’s Affiliates in the evaluation and
      documentation of any such inventions, patent applications, and patents
      referred to above. Franchisee also agrees to assist Franchisor and/or
      Franchisor’s Affiliates in the documentation of such assignment in any way
      necessary to transfer such interest to Franchisor and/or Franchisor’s
      Affiliates. Franchisee also agrees to assist Franchisor and/or
      Franchisor’s Affiliates in obtaining and maintaining such interest,
      including signing any declaration, patent application, assignment of
      rights, power of attorney, or other documents in such form and substance
      as Franchisor may require related to such invention or interest.
      Franchisee further agrees to assist Franchisor and/or Franchisor’s
      Affiliates in the protection and enforcement of any such interest,
      including testifying in any court action brought to enforce, protect, or
      defend such interest or invention.
	 
	19.	WORKS OF AUTHORSHIP AND
      COPYRIGHTS
	 
	19.1	Franchisee agrees that all works
      (defined herein as including works of authorship, works in any tangible
      medium, writings, documents, and computer programs) authored, made, or
      produced by Franchisee, Franchisee’s Owners, or Franchisee’s Affiliates
      that are in any way related to the System, the Products, the development
      or operation of Krispy Kreme Stores or Commissary Facilities, or the
      production, marketing, or sale of the Products, whether or not such works
      are copyrightable, are “works-made-for-hire” and that Franchisee will not
      have, under this Agreement or otherwise, any right, title, or interest of
      any kind or nature in and to such works, and that all rights therein are
      the sole and exclusive property of Franchisor and/or its
    Affiliates.
	 
	19.2	If any portion of any work
      described above is not considered a work-made-for-hire for Franchisor or
      its Affiliates, Franchisee hereby agrees to assign, and does assign, to
      Franchisor and/or the Affiliates Franchisor designates, all right, title,
      and interest in any work authored, made, or produced by Franchisee or its
      Owners or Affiliates (whether alone or in conjunction with one or more
      other persons) in the course of involvement with Franchisor under this
      Agreement or otherwise relating to the System, the Products, the Marks,
      the development or operation of Krispy Kreme Stores or Commissary
      Facilities, or the production, marketing, or sale of the Products.
      Franchisor will have no obligation to make payments to Franchisee or any
      other Person with respect to any such assignment. Franchisee agrees that
      all such works referenced above shall belong to Franchisor and/or its
      Affiliates, and that all right, title, and interest therein, including any
      copyrights, shall be the sole and exclusive property of Franchisor and/or
      its Affiliates, except that Franchisee shall be entitled to use all such
      works at the FACILITY (if authorized by Franchisor) without charge by
      Franchisor.
	 
	19.3	Franchisee agrees to assist
      Franchisor in the evaluation, documentation, and registration of any such
      work described above. Franchisee also agrees to assist Franchisor in the
      documentation of such assignment in any way necessary to transfer such
      interest to Franchisor or its Affiliates. Franchisee also agrees to assist
      Franchisor in obtaining and maintaining such interest, including signing
      any assignment of rights, copyright application, power of attorney, or
      other document in such form and substance as Franchisor may require
      related to such work or interest. Franchisee further agrees to assist
      Franchisor in the protection and enforcement of any such interest,
      including testifying in any court action brought to enforce, protect, or
      defend such work.

D-22

	20.	EXCLUSIVE
      RELATIONSHIP
	 
	20.1	Franchisee acknowledges
      and agrees that Franchisor would be unable to (a) protect the Confidential
      Information against unauthorized use or disclosure; (b) preserve the
      prestige, integrity, and goodwill of the Products, Marks, and System; or
      (c) encourage the free exchange of ideas and information among Krispy
      Kreme Stores and Commissary Facilities if franchisees and owners of Krispy
      Kreme Stores and Commissary Facilities or their owners were permitted to
      engage in or benefit from certain competitive activities. Franchisee also
      acknowledges that Franchisor has granted the franchise rights to
      Franchisee in consideration of and reliance on Franchisee’s agreement that
      Franchisee and its Owners will deal exclusively with Franchisor.
      Therefore, except as expressly authorized by this Agreement or another
      written agreement with Franchisor, Franchisee agrees that during the term
      of this Agreement, without Franchisor’s prior written consent, neither
      Franchisee, nor any other Restricted Person will:
	              
    	              
    	
	 	(i)	have any Ownership Interest in a
      Competitive Business;
	 
	 	(ii)	perform services as a director,
      officer, manager, partner, or supervisory or management-level employee, of
      any Competitive Business;
	 
	 	(iii)	perform services as an employee,
      consultant, representative, agent or otherwise for a Competitive Business,
      where such services (A) are substantially similar to those provided to
      Franchisor or Franchisor Affiliates by Franchisee or the respective
      Restricted Person; or (B) create a relationship between Franchisee or the
      Restricted Person and such Competitive Business in which Franchisee or the
      Restricted Person could be reasonably expected to benefit, either directly
      or indirectly, whether financially or otherwise, from the disclosure of
      any material Confidential Information to such Competitive
    Business;
	 
	 	(iv)	recruit or hire any Person who is
      Franchisor’s employee or the employee of any Krispy Kreme Store or
      Commissary Facility, or who has been Franchisor’s employee or the employee
      of any Krispy Kreme Store or Commissary Facility within the past six (6)
      months without obtaining prior written permission from Franchisor and that
      Person’s employer. If Franchisor permits Franchisee to hire any such
      Person, then Franchisee agrees to pay Franchisor a non-refundable
      Management Development Fee in the amount of Twenty-Five Thousand Dollars
      ($25,000) per hired employee as of the date of hire; or
	 
	 	(v)	induce or attempt to induce any
      Person who is Franchisor’s employee or the employee of any Krispy Kreme
      Store or Commissary Facility to discontinue working for Franchisor or such
      Krispy Kreme Store or Commissary Facility as the case may be.
	 
	20.2	At all times during the
      Term, Franchisee will designate a Managing Director of its business
      pursuant to this Agreement who shall complete Franchisor’s mandatory
      training program to Franchisor’s satisfaction. The initial Managing
      Director is identified in the Basic Terms. The Managing Director will use
      his or her full-time efforts to fulfill Franchisee’s obligations under
      this Agreement and under Franchise Agreements and any other Commissary
      Facility Agreements, and will not directly or indirectly engage in any
      other business or activity that requires any significant management
      responsibility or time commitments, or that otherwise conflicts with
      Franchisee’s obligations under this Agreement. If the Managing Director is
      terminated in that role, or if the Managing Director does not carry out
      his or her responsibilities or otherwise perform in accordance with this
      Agreement, Franchisee will promptly designate a replacement, and each such
      replacement shall complete Franchisor’s mandatory training program to
      Franchisor’s satisfaction.
	 
	21.	COMPLIANCE WITH
      LAW
	 
	21.1	In operating the
      FACILITY, Franchisee agrees to comply with all laws, including, but not
      limited to, all federal, state, and local laws, rules, regulations,
      ordinances, court orders, and decrees. Franchisee agrees that its failure
      to comply with these laws is a material breach and grounds for termination
      of this Agreement.

D-23

	21.2	Franchisee and Franchisee’s
      Principal Owners represent and warrant to Franchisor that neither
      Franchisee nor any Principal Owner is identified, either by name or an
      alias, pseudonym or nickname, on the lists of “Specially Designated
      Nationals” or “Blocked Persons” maintained by the U.S. Treasury
      Department’s Office of Foreign Assets Control. Further, Franchisee and
      Franchisee’s Principal Owners represent and warrant that neither has
      violated and agree that neither will violate any law (in effect now or
      which may become effective in the future) prohibiting corrupt business
      practices, money laundering or the aid or support of persons or entities
      who conspire to commit acts of terror against any person or government,
      including acts prohibited by the U.S. Patriot Act, U.S. Executive Order
      13244, or similar law.
	              
    	
	22.	MARKETING AND
      ADVERTISING
	 
	22.1	Franchisor has established a fund
      (the “Brand Fund”) for the creation, production and/or implementation of
      advertising, promotional, marketing, and public relations programs and
      materials Franchisor deems appropriate. Franchisee agrees to contribute to
      the Brand Fund amounts (as determined by Franchisor from time to time) not
      more than one percent (1%) of the Net Sales of the FACILITY, payable by
      electronic funds transfer in the same manner as the Royalties. Krispy
      Kreme Stores and Commissary Facilities located in the U.S. and owned or
      operated by Franchisor shall contribute to the Brand Fund at least on the
      same basis.
	 
	22.2	Franchisor will direct all
      programs funded by the Brand Fund. Periodically, Franchisor may give
      Franchisee, at no cost, samples of advertising, marketing, and promotional
      formats and materials produced and funded by the Brand Fund. Franchisee
      may purchase additional copies of these materials at cost.
	 
	22.3	The Brand Fund will be accounted
      for separately from Franchisor’s other funds and will not be used to
      defray any of its general operating expenses, except for reasonable
      salaries, administrative costs and overhead Franchisor may incur in
      activities related to the administration of the Brand Fund and its
      programs, including conducting market research, preparing advertising and
      marketing materials and collecting and accounting for contributions to the
      Brand Fund. Franchisor may spend in any fiscal year an amount greater or
      less than the aggregate contributions of all Krispy Kreme Stores and
      Commissary Facilities to the Brand Fund in that year, and the Brand Fund
      may borrow from Franchisor or other lenders to cover deficits in the Brand
      Fund or cause the Brand Fund to invest any surplus for future use by the
      Brand Fund.
	 
	22.4	Franchisor will prepare annually
      a statement of monies collected and costs incurred by the Brand Fund and
      furnish Franchisee a copy upon Franchisee’s written request. Except as
      otherwise expressly provided in this Section 22, Franchisor assumes
      no direct or indirect liability or obligation with respect to the
      maintenance, direction or administration of the Brand Fund. Franchisor
      does not act as trustee or in any other fiduciary capacity with respect to
      the Brand Fund.
	 
	22.5	Franchisor may operate the Brand
      Fund through a separate entity whenever it deems appropriate. The
      successor entity will have all of the rights and duties specified in
      Sections 22.1 through 22.8.
	 
	22.6	Franchisor cannot ensure that
      Brand Fund expenditures in or affecting any geographic area are
      proportionate or equivalent to Brand Fund contributions by contributors
      operating in that geographic area or that any contributor benefits
      directly or in proportion to its Brand Fund contribution.
	 
	22.7	Franchisor has the right, but no
      obligation, to use collection agents and institute legal proceedings to
      collect Brand Fund contributions at the Brand Fund’s expense. Franchisor
      may also forgive, waive, settle and compromise any and all claims for
      contributions to the Brand Fund. Except as expressly provided in
      Sections 22.1 through 22.8, Franchisor assumes no
      direct or indirect liability or obligation to Franchisee for collecting
      amounts due to, maintaining, directing or administering the Brand
      Fund.
	 
	22.8	Franchisor may at any time defer
      or reduce the Brand Fund contributions of one or more franchisees and,
      upon thirty (30) days’ prior written notice to Franchisee, reduce or
      suspend Brand Fund contributions and operations for one or more periods of
      any length and terminate (and, if terminated, reinstate) the
    Brand

D-24

	 	Fund. If Franchisor terminates
      the Brand Fund, it will distribute all unspent monies to its franchisees,
      and to Franchisor and its Affiliates, in proportion to their, and
      Franchisor’s, respective Brand Fund contributions during the preceding
      twelve (12) month period. 
	              
    	
	22.9	Franchisee will not execute or
      conduct any advertising or promotional activity in relation to the
      FACILITY or the System without Franchisor’s prior written approval.
      Franchisee must submit annual marketing plans to Franchisor in a form
      Franchisor specifies. Such annual marketing plans require Franchisor
      approval. 
	 
	22.10	[THIS SECTION HAS BEEN
      INTENTIONALLY DELETED] 
	 
	22.11	[THIS SECTION HAS BEEN
      INTENTIONALLY DELETED] 
	 
	22.12	Before Franchisee uses any
      advertising, promotional or marketing materials that Franchisor has not
      prepared or previously approved, Franchisee must send samples of all such
      materials to Franchisor for approval. If Franchisee does not receive
      Franchisor’s written approval within thirty (30) days after Franchisor
      receives the materials, they are deemed approved. Franchisee may not use
      any advertising, promotional, or marketing materials that Franchisor has
      disapproved. 
	 
	22.13	Franchisee agrees that any
      advertising, promotion and marketing it conducts will be completely clear
      and factual and not misleading and conform to the highest standards of
      ethical marketing and the promotion policies and System Standards that
      Franchisor prescribes from time to time. 
	 
	22.14	At Franchisor’s option,
      Franchisor may establish one or more websites to advertise, market, and
      promote Krispy Kreme Stores, the Products, and/or the Krispy Kreme
      franchise system (each a “System Website”). If Franchisor establishes a
      System Website, Franchisor may require Franchisee to participate in such
      System Website by including information relating to the FACILITY.
      Franchisor will control website traffic and registration of additional
      domain names. 
	 
	22.15	Franchisee may not develop,
      maintain, or authorize any other website that mentions or describes
      Franchisee or the FACILITY or that displays any of the Marks without
      obtaining written approval from Franchisor. 
	 
	22.16	[THIS SECTION HAS BEEN
      INTENTIONALLY DELETED] 
	 
	23.	ACCOUNTING, REPORTS AND
      FINANCIAL STATEMENTS 
	 
	23.1	Franchisee will, at Franchisee’s
      expense, retain all records relating to the development and operation of
      the FACILITY. All such records shall be kept at the premises of the
      FACILITY, unless Franchisor otherwise approves. Franchisee will furnish to
      Franchisor via the medium Franchisor prescribes from time to time, in a
      form consistent with its then-current accounting practices and procedures:
      (a) by each Reporting Day, reports of the FACILITY’s sales, distribution
      of Products (including number of units and Stores to which distributed),
      cost of goods sold, labor expense and number of transactions for the
      preceding Week; (b) within thirty (30) days after the end of each month,
      an operating income statement of Franchisee, the FACILITY, or both for
      such month and fiscal year to date, prepared in accordance with generally
      accepted accounting principles consistently applied; (c) within forty-five
      (45) days after the end of each fiscal quarter, a balance sheet and income
      statement of Franchisee, the FACILITY, or both for such quarter and fiscal
      year to date, prepared in accordance with generally accepted accounting
      principles consistently applied; (d) within one hundred twenty days (120)
      days after the end of Franchisee’s fiscal year, a balance sheet and an
      income statement for the FACILITY and/or Franchisee for such fiscal year
      (reflecting all year-end adjustments), and a statement of cash flow of the
      FACILITY, prepared in accordance with generally accepted accounting
      principles consistently applied; and (e) upon request by Franchisor, such
      other data, reports, information and supporting records as Franchisor may
      from time to time prescribe. 
	 
	23.2	Franchisee agrees to maintain and
      to furnish to Franchisor, upon request, complete copies of all
      withholding, income, sales, value added, use and service tax returns filed
      by Franchisee reflecting activities of the FACILITY.

D-25

	23.3	Franchisor has the right to (a)
      disclose data derived from all reports; (b) require Franchisee to have
      audited financial statements prepared on an annual basis; and (c) to
      access all cash registers/computer terminals and Franchisee’s Computer
      System and retrieve all information relating to the FACILITY, as often as
      it deems appropriate. Franchisee will take such action as may be necessary
      to provide such access to Franchisor. Furthermore, Franchisee will
      immediately report to Franchisor any events or developments which may have
      a significant or material adverse impact on the operation of the FACILITY,
      Franchisee’s performance under this Agreement, or the goodwill associated
      with the Marks and Krispy Kreme Stores. Franchisee will sign and verify as
      correct and complete each report and financial statement submitted by
      Franchisee in the manner prescribed by Franchisor. 
	              
    	
	23.4	Each year, Franchisor requires
      that Franchisee submit an annual business plan for Franchisor’s review.
      Further, Franchisor has the right to audit at any time during regular
      business hours, and without prior notice to Franchisee, to inspect and
      audit, or cause to be inspected and audited, the business, financial and
      tax records of the FACILITY and Franchisee. Franchisee will fully
      cooperate and cause its employees and agents to fully cooperate with
      Franchisor’s representatives and independent accountants hired by
      Franchisor to conduct any such inspection or audit. Franchisor’s right to
      audit includes the right to access the Computer System. In the event any
      such inspection or audit reveals an understatement of the Net Sales of the
      FACILITY, Franchisee will pay to Franchisor, within fifteen (15) days
      after receipt of the inspection or audit report, the Royalty payments and
      Brand Fund contributions due on the amount of such understatement, plus
      interest (at the rate and on the terms provided in this Agreement) from
      the date originally due until the date of payment. Further, in the event
      such inspection or audit is made necessary by Franchisee’s failure to
      furnish timely any reports or supporting records required to be submitted
      under this Agreement or if an understatement of Net Sales for the period
      of any audit is determined by any such audit or inspection to be greater
      than two percent (2%), Franchisee will reimburse Franchisor for the cost
      of such inspection or audit, including legal fees, accountants’ fees and
      the travel expenses, room and board, per diem charges, and other
      associated expenses for Franchisor’s employees. The foregoing remedies are
      in addition to all other remedies and rights contained in this Agreement
      or under applicable law. 
	 
	24.	TRANSFER 
	 
	24.1	This Agreement is fully
      transferable by Franchisor (without any obligation to provide notice to
      Franchisee or obtain Franchisee’s consent) and will inure to the benefit
      of any assignee or other legal successor to Franchisor’s interests.
      Franchisee agrees that Franchisor will have the right, from time to time,
      to delegate the performance of any portion of or all of its obligations
      and duties under this Agreement or otherwise in connection with the System
      to designees, whether the same are Franchisor’s agents or independent
      contractors with which Franchisor has contracted to provide such services
      or perform such duties. 
	 
	24.2	Franchisee’s rights and duties
      under this Agreement are personal to Franchisee, or if Franchisee is a
      business corporation, partnership, limited liability company or any other
      legal entity, its Owners. Accordingly, neither Franchisee nor any of its
      Owners may Transfer the Franchise without Franchisor’s prior approval and
      without complying with the terms and conditions of Section 24. Any Transfer without
      such approval or compliance constitutes a breach of this Agreement, and is
      void and of no force or effect. Notwithstanding the foregoing, Franchisee
      may not under any circumstances directly or indirectly subfranchise or
      sublicense any of its rights hereunder. 
	 
	24.3	If Franchisor has not exercised
      its right of first refusal under Section
      24.5, Franchisor will not unreasonably
      withhold its approval of a Transfer of the Franchise that meets all of the
      reasonable restrictions, requirements and conditions Franchisor imposes on
      the Transfer, the transferor(s) and/or the transferee(s) from time to
      time, which shall in any event include, the following: 
	 

		(a)	Franchisee must be in Good
      Standing; 
	              
    	              
    	
		(b)	the proposed transferee and its
      owners (if the proposed transferee is a corporation, partnership, limited
      liability company or other legal entity) must provide Franchisor on a
      timely basis all information Franchisor requests, and must be individuals
      acting in their individual capacities 

D-26

		 	who are of good character and
      reputation, who must have sufficient business experience, aptitude and
      financial resources to operate the FACILITY pursuant to this Agreement and
      to develop Krispy Kreme Stores and Commissary Facilities pursuant to the
      Development Agreement, if applicable, and who must otherwise meet
      Franchisor’s then-current standards for approval; 
	              
    	              
    	
		(c)	the proposed transferee may not
      be an entity, or be affiliated with an entity, that is required to comply
      with the reporting and information requirements of the Securities Exchange
      Act of 1934, as amended; 
		 
		(d)	the transferee (and its owners)
      must agree to be bound by all of the provisions of this Agreement for the
      remainder of the Term or, at Franchisor’s option, execute Franchisor’s
      then current Commissary Facility Agreement and related documents used in
      the state where the FACILITY is located (which may provide for different
      royalties, advertising contributions, duration and other rights and
      obligations than those provided in this Agreement); 
		 
		(e)	the transferee must acquire, in a
      concurrent transaction, all of the rights and obligations of Franchisee
      and its Affiliates under all agreements between Franchisee or its
      Affiliates and Franchisor or its Affiliates, including any Development
      Agreement and all Franchise Agreements and Commissary Facility Agreements
      executed by Franchisee or its Affiliates pursuant to the Development
      Agreement or pursuant to any other development or similar agreement with
      Franchisor; 
		 
		(f)	Franchisee or the transferee must
      pay Franchisor a transfer fee in an amount equal to Five Thousand Dollars
      ($5,000.00); 
		 
		(g)	Franchisee and its Owners and
      Affiliates must, except to the extent limited or prohibited by applicable
      law, execute a general release, in form and substance satisfactory to
      Franchisor, of any and all claims against Franchisor, its Affiliates and
      shareholders, members, managers, officers, directors, employees, agents,
      successors and assigns; 
		 
		(h)	Franchisee must provide
      Franchisor with all information requested by Franchisor in connection with
      the Transfer, and Franchisor must not have disapproved the material terms
      and conditions of such Transfer (including the price and terms of payment
      and the amount to be financed by the transferee in connection with such
      Transfer) on the basis that they are so burdensome as to be likely, in
      Franchisor’s reasonable judgment, to adversely affect the transferee’s
      operation of the FACILITY or its compliance with this Agreement, all
      Franchise Agreements, Commissary Facility Agreements, and Development
      Agreements being transferred and any other agreements to be executed by
      the transferee; 
		 
		(i)	If Franchisee (or any of its
      Owners or Affiliates) finances any part of the sales price of the
      transferred interest, Franchisee and/or its Owners or Affiliates must
      agree that all obligations of the transferee, and security interests
      reserved by any of them in the assets transferred, will be subordinate to
      the transferee’s obligations to pay all amounts due Franchisor and its
      Affiliates and to otherwise comply with this Agreement, all Franchise
      Agreements, Commissary Facility Agreements, and Development Agreements
      being transferred and any other agreements to be executed by the
      transferee; 
		 
		(j)	Franchisee and its Owners must
      execute non-competition and non-solicitation covenants, in form and
      substance satisfactory to Franchisor, substantially similar to those
      contained in Section
      27.3; and 
		 
		(k)	Franchisee and its Owners and
      Affiliates must execute such other documents and do such other things as
      Franchisor reasonably requires to protect its rights under this Agreement
      and all Development Agreements, Franchise Agreements, Commissary Facility
      Agreements and other agreements being transferred.

D-27

	24.4	Franchisor’s approval of a
      Transfer of the Franchise does not constitute: (a) a representation as to
      the fairness of the terms of any agreement or arrangement between
      Franchisee or its Owners and the transferee or as to the prospects for
      success by the transferee; or (b) a release of Franchisee and its Owners,
      a waiver of any claims against Franchisee or its Owners or a waiver of
      Franchisor’s right to demand the transferee’s compliance with this
      Agreement or any other agreements being transferred. Any approval shall
      apply only to the specific Transfer of the Franchise being proposed and
      shall not constitute Franchisor’s approval of, or have any bearing on, any
      other proposed Transfer of the Franchise. 
	              
    	
	24.5	If Franchisee or any of its
      Owners desires to Transfer the Franchise (other than by gift or bequest),
      Franchisee or such Owners must obtain a bona fide, executed written
      offer from a responsible and fully disclosed purchaser (which must contain
      a confidentiality covenant by Franchisee and the prospective buyer to
      which Franchisor shall be an intended third party beneficiary) and must
      deliver immediately to Franchisor a complete and accurate copy of such
      offer. If the offeror proposes to buy any other property or rights from
      Franchisee or any of its Owners or Affiliates (other than rights under any
      Development Agreements, Franchise Agreements or Commissary Facility
      Agreements) as part of the bona fide
      offer, the proposal for such property
      or rights must be set forth in a separate, contemporaneous offer that is
      fully disclosed to Franchisor, and the price and terms of purchase offered
      to Franchisee or its Owners for the Transfer of the Franchise must reflect
      the bona fide price offered therefor and not reflect any value for any
      other property or rights. 
	 
	24.6	Franchisor has the option,
      exercisable by notice delivered to Franchisee or its Owners within thirty
      (30) days from the date of delivery of a complete and accurate copy of
      such offer to Franchisor, to purchase such interest for the price and on
      the terms and conditions contained in such offer, provided that: (a)
      Franchisor may substitute cash for any form of payment proposed in such
      offer; (b) Franchisor’s credit shall be deemed equal to the credit of any
      proposed purchaser; (c) Franchisor shall have not less than ninety (90)
      days from the option exercise date to consummate the transaction; and (d)
      Franchisor shall not be required to pay deposits (such as earnest money)
      or to escrow funds prior to closing. Franchisor has the right to
      investigate and analyze the business, assets and liabilities and all other
      matters Franchisor deems necessary or desirable in order to make an
      informed investment decision with respect to the fairness of the terms of
      the right of first refusal. Franchisor may conduct such investigation and
      analysis in any manner Franchisor deems reasonably appropriate, and
      Franchisee and its Owners must cooperate fully with Franchisor in
      connection therewith. 
	 
	24.7	If Franchisor exercises its
      option to purchase, Franchisor is entitled to purchase such interest
      subject to all representations and warranties, closing documents,
      releases, non-competition covenants and indemnities as Franchisor
      reasonably may require, provided if Franchisor exercises its option as a
      result of a written offer reflected in a fully negotiated definitive
      agreement with the proposed purchaser, Franchisor will not be entitled to
      any additional representations, warranties, closing documents or
      indemnities that will have a materially adverse effect on Franchisee’s
      rights and obligations under the definitive agreement. 
	 
	 	If Franchisor does not exercise
      its option to purchase, Franchisee or its Owners may complete the sale to
      such offeror pursuant to and on the exact terms of such offer, subject to
      Franchisor’s approval of the Transfer as provided in Sections 24.2 and
      24.3,
      provided that if the sale to such offeror is not completed within ninety
      (90) days after delivery of such offer to Franchisor, or if there is a
      change in the terms of the offer, Franchisee must promptly notify
      Franchisor and Franchisor shall have an additional option to purchase (on
      the terms of the revised offer, if any, and otherwise as set forth herein)
      during the thirty (30)-day period following Franchisee’s notification of
      the expiration of the ninety (90)-day period or the change to the terms of
      the offer. 
	 
	24.8	Neither Franchisee nor any of its
      Owners or Affiliate may issue or sell, or offer to issue or sell, any of
      Franchisee’s securities or any securities of any of its Affiliates,
      regardless of whether such sale or offer would be required to be
      registered pursuant to the provisions of the Securities Act of 1933, as
      amended, or the securities laws of any other jurisdiction and regardless
      of the means by which such sale is conducted, directly or indirectly, or
      by operation of law (including by merger, consolidation, reorganization or
      otherwise) without obtaining Franchisor’s prior consent and complying with
      all of its requirements 

D-28

	 	and restrictions
      concerning use of information about Franchisor and its Affiliates. Neither
      Franchisee nor any of its Owners or Affiliates may issue or sell
      Franchisee’s securities or the securities of any of its Affiliates if: (1)
      such securities would be required to be registered pursuant to the
      Securities Act of 1933, as amended, or such securities would be owned by
      more than 35 persons; or (2) after such issuance or sale, Franchisee or
      such Affiliate would be required to comply with the reporting and
      information requirements of the Securities Exchange Act of 1934, as
      amended. Any memorandum or other communications circulated in connection
      with any solicitation of offers to purchase that would require
      Franchisor’s consent to Transfer the Franchise (through whatever form of
      transaction, whether through direct or indirect sale of assets or
      securities, by operation of law or otherwise) shall be subject to approval
      by Franchisor. 
	 
	25.	SUCCESSOR
      FRANCHISE 
	 
	25.1	Upon expiration of the
      Term, Franchisor will grant Franchisee a successor franchise on
      Franchisor’s then-current terms if Franchisee and each of its Owners and
      Affiliates are in full compliance with the provisions of this Agreement
      and any other agreements with Franchisor or any of its Affiliates, and
      provided that the following conditions are met: 
	 
	 	(a)	Franchisee needs to continue to
      operate the Facility to support its Hot Shops, Fresh Shops and / or
      Kiosks, maintains possession of the Site and agrees to upgrade the
      FACILITY to Franchisor’s then-current standards for Commissary
      Facilities; 
	              
    	              
    	
	 	(b)	If Franchisee is unable to
      maintain possession of the Site, or if in Franchisor’s judgment the
      FACILITY should be relocated, and Franchisee secures a substitute site
      approved by Franchisor, Franchisee develops such site in compliance with
      Franchisor’s then-current standards for Commissary Facilities, and
      continues to operate the FACILITY at the Site until operations are
      transferred to the substitute site; 
	 
	 	(c)	Franchisee gives Franchisor
      written notice of its election to acquire a successor franchise at least
      six (6) months but not more than twelve (12) months prior to the
      expiration of the term of the Franchise; 
	 
	 	(d)	Franchisee and its Owners and
      Affiliates are then in compliance with all of the terms and conditions of
      this Agreement and all other agreements between such parties and
      Franchisor and its Affiliates, and have been in substantial compliance
      with all such agreements throughout their respective terms; 
	 
	 	(e)	Franchisee and its Owners will
      execute the terms and conditions of the agreements Franchisor then
      customarily uses in connection with the grant of successor franchises for
      Commissary Facilities in the state where the FACILITY is located;
      and 
	 
	 	(f)	Franchisee and its Owners and
      Affiliates will execute and deliver general releases, in form and
      substance satisfactory to Franchisor, of any and all claims against
      Franchisor and its Affiliates, shareholders, officers, directors,
      employees, agents, successors, and assigns. 
	 
	25.2	Once Franchisor
      receives notice from Franchisee in accordance with Section 25.1(c) above, Franchisor will give Franchisee notice, within ninety (90)
      days after Franchisor’s receipt of Franchisee’s notice and any supporting
      information requested by Franchisor, of Franchisor’s decision: (a) to
      grant Franchisee a successor franchise; (b) to grant Franchisee a
      successor franchise on the condition that deficiencies of the FACILITY,
      and/or in its operation of the FACILITY, or such other matters as
      Franchisor may indicate are deficient in its sole discretion are
      corrected; or (c) not to grant Franchisee a successor franchise. If
      Franchisor’s notice states that Franchisee must cure certain deficiencies
      of the FACILITY, its operation or otherwise as a condition to the grant of
      a successor franchise, Franchisee will have thirty (30) days from the
      receipt of such notice to cure such deficiencies. If Franchisee does not
      cure such deficiencies, Franchisor will give Franchisee written notice of
      a decision not to grant a successor franchise, based upon Franchisee
      failure to cure such deficiencies, within thirty (30) days after the
      expiration of the cure period, 

D-29

	 	provided, however, that
      Franchisor will not be required to give Franchisee such notice if
      Franchisor decides not to grant Franchisee a successor franchise due to
      Franchisee’s breach of this Agreement during the cure period or the thirty
      (30) day period thereafter. 
	              
    	
	26.	TERMINATION OF
      FRANCHISE 
	 
	26.1	Franchisee is in material breach
      of this Agreement, and this Agreement will automatically terminate without
      notice, at Franchisor’s discretion, if: (a) Franchisee becomes insolvent
      by reason of its inability to pay its debts as they mature; (b) Franchisee
      is adjudicated bankrupt or insolvent; (c) Franchisee files a petition in
      bankruptcy, reorganization or similar proceeding under the bankruptcy laws
      of the United States or has such a petition filed against Franchisee,
      which is not discharged within thirty (30) days; (d) a receiver or other
      custodian, permanent or temporary, is appointed for Franchisee’s business,
      assets or property; (e) Franchisee requests the appointment of a receiver
      or makes a general assignment for the benefit of creditors; (f) a final
      judgment against Franchisee in the amount of Fifty Thousand Dollars
      ($50,000.00) or more remains unsatisfied of record for sixty (60) days or
      longer; (g) Franchisee’s bank accounts, property or accounts receivable
      are attached; (h) execution is levied against Franchisee’s business or
      property; (i) suit is filed to foreclose any lien or mortgage against any
      of Franchisee’s assets and such suit is not dismissed within thirty (30)
      days; (j) Franchisee voluntarily dissolves or liquidates or has a petition
      filed for corporate or partnership dissolution and such petition is not
      dismissed within thirty (30) days; or (k) Franchisee’s assets, property or
      interest are “blocked” under any law, ordinance or regulation relating to
      terrorist activities or if Franchisee is otherwise in violation of any
      such law, ordinance or regulation. 
	 
	26.2	In addition to Franchisor’s right
      to terminate pursuant to other provisions of this Agreement and under
      applicable law, Franchisor has the right to terminate this Agreement,
      effective upon delivery of notice of termination to Franchisee, if
      Franchisee or any of its Principal Owners or Affiliates: 
	 

		(a)	opens the FACILITY in violation
      of Section 11.1; 
	              
    	              
    	
		(b)	abandons or fails actively to
      operate the FACILITY for five (5) consecutive days, unless a closing of
      the FACILITY has been approved by Franchisor; 
		 
		(c)	makes any material misstatement
      or omission in the Franchise Application or in any other information,
      report, or summary provided to Franchisor at any time; 
		 
		(d)	suffers cancellation or
      termination of the lease or sublease for the FACILITY; 
		 
		(e)	is convicted of, or pleads no
      contest to, a felony or other crime or offense that Franchisor believes,
      in its sole judgment, may adversely affect the System or the goodwill
      associated with the Marks; 
		 
		(f)	makes an unauthorized Transfer of
      the Franchise; 
		 
		(g)	makes any unauthorized use or
      disclosure of any Confidential Information or uses, duplicates or
      discloses any portion of the System Standards Manuals in violation of this
      Agreement; 
		 
		(h)	fails or refuses to comply with
      any mandatory specification, standard, or operating procedure prescribed
      by Franchisor relating to the cleanliness or sanitation of the FACILITY or
      violates any applicable health, safety or sanitation law, ordinance or
      regulation that Franchisor in its sole judgment believes may pose harm to
      the public or to its reputation, and does not correct such failure,
      refusal or violation within 24 hours after written notice thereof is
      delivered to Franchisee; 
		 
		(i)	fails to report accurately Net
      Sales, to establish, maintain and/or have sufficient funds available in
      the Account as required by Section 13.3
      or fails to make payment of any amounts
      due Franchisor or any of its Affiliates, and does not correct such failure
      within ten (10) days after written notice of such failure is delivered to
      Franchisee; 

D-30

	 	(j)	fails to make a timely payment of
      any amount due to a supplier unaffiliated with Franchisor (other than
      payments which are subject to bona fide dispute), and does not correct
      such failure within thirty (30) days after Franchisor delivers to
      Franchisee notice of such failure to comply; 
	              
    	              
    	
	 	(k)	fails to comply with any other
      provision of this Agreement or any other mandatory specification, standard
      or operating procedure or other obligation prescribed in the System
      Standards Manuals and does not correct such failure within thirty (30)
      days after notice of such failure to comply is delivered to Franchisee;
      or 
	 
	 	(l)	fails on three (3) or more
      separate occasions within any period of twelve (12) consecutive months to
      submit when due reports or other data, information or supporting records
      or to pay when due Royalties, Brand Fund contributions or other payments
      due Franchisor, any of its Affiliates or any unaffiliated suppliers or
      otherwise fails to comply with this Agreement or any mandatory
      specification, standard or operating procedure or other obligation
      prescribed in the System Standards Manuals, whether or not such failure is
      corrected after notice is delivered to Franchisee. 
	 
	26.3	Franchisor has the
      option, but not the obligation, to cure any of Franchisee’s default under
      Section 26.2. If Franchisor chooses to exercise such option, then within five
      (5) days of the date Franchisor sends Franchisee notice of Franchisor’s
      expenses incurred in curing Franchisee’s default, Franchisee shall
      reimburse Franchisor for all such expenses. 
	 
	27.	EFFECT OF
      TERMINATION OR EXPIRATION 
	 
	27.1	Within ten (10) days
      after the effective date of termination or expiration (without renewal) of
      this Agreement, Franchisee must pay Franchisor and its Affiliates all
      Royalties, Brand Fund contributions, amounts owed for purchases from
      Franchisor or its Affiliates, interest due on any of the foregoing and all
      other amounts owed to Franchisor or its Affiliates which are then
      unpaid. 
	 
	27.2	Upon the termination or
      expiration (without renewal) of this Agreement, Franchisee will:
  
	 
	 	(a)	not directly or indirectly at any
      time or in any manner use any Mark; any colorable imitation of any Mark or
      any other indicia of a Krispy Kreme Store or Commissary Facility;
    
	 
	 	(b)	take such action as may be
      required to cancel all fictitious or assumed name registrations relating
      to Franchisee’s use of any Mark; 
	 
	 	(c)	notify the telephone company and
      all telephone directory publishers of the termination or expiration of
      Franchisee’s right to use any telephone number and any regular, classified
      or other telephone directory listings associated with any Mark and to
      authorize transfer of the number to Franchisor or at its direction;
    
	 
	 	(d)	if Franchisor does not exercise
      its option to purchase the FACILITY pursuant to Section 27.5, promptly remove
      from the Site, and discontinue using for any purpose, all signs, fixtures,
      furniture, decor items, advertising materials, forms and other materials
      and supplies which display any of the Marks or any distinctive features,
      images, or designs associated with Krispy Kreme Stores or Commissary
      Facilities, at Franchisee’s expense, make such alterations as may be
      necessary to distinguish the Site so clearly from its former appearance as
      a Commissary Facility as to prevent any possibility of confusion by the
      public; 
	 
	 	(e)	immediately cease to use all
      Confidential Information and return to Franchisor all copies of the System
      Standards Manuals and any other confidential materials which have been
      loaned to Franchisee; 
	 
	 	(f)	immediately discontinue any mode
      of communications on the Internet directly or indirectly relating to the
      FACILITY, including any websites or web pages, and immediately take all
      steps required by Franchisor to transfer to Franchisor any domain name
      associated with the FACILITY 

D-31

			(such as executing a registrant name change agreement
      with the applicable registrar). Franchisee irrevocably appoints an
      authorized officer of Franchisor as Franchisee’s duly authorized agent and
      attorney-in-fact to execute all instruments and take all steps to transfer
      such domain names; 
	 		
	 	(g)	immediately discontinue the use
      of any proprietary software; and 
	              
    	              
    	
	 	(h)	within thirty (30) days after the
      effective date of termination or expiration, furnish evidence satisfactory
      to Franchisor of Franchisee’s compliance with the foregoing
      obligations. 
	 
	27.3	Upon termination or
      expiration (without renewal) of this Agreement, neither Franchisee nor any
      Restricted Person will, for a period of two (2) years commencing on the
      effective date of such termination or expiration or the date on which
      Franchisee ceases to conduct its activities under this Agreement,
      whichever is later: 
	 
	 	(a)	have any Ownership Interest in a
      Competitive Business located within a radius of ten (10) miles of the Site
      or of any other Krispy Kreme Store or Commissary Facility then open or
      under construction; 
	 		
	 	(b)	perform services as a director,
      officer, manager, partner, or supervisory or management-level employee, of
      any Competitive Business located within a radius of ten (10) miles of the
      Site or of any other Krispy Kreme Store or Commissary Facility open or
      under construction on the effective date of termination or
      expiration; 
	 
	 	(c)	perform services as an employee,
      consultant, representative, agent or otherwise for a Competitive Business
      located within a radius of ten (10) miles of the Site or of any other
      Krispy Kreme Store or Commissary Facility then open or under construction,
      where such services: (i) are substantially similar to those provided to
      Franchisor or Franchisor Affiliates by Franchisee or the respective
      Restricted Person; or (ii) create a relationship between Franchisee or the
      Restricted Person and such Competitive Business in which Franchisee or the
      Restricted Person could be reasonably expected to benefit, either directly
      or indirectly, whether financially or otherwise, from the disclosure of
      any Confidential Information to such Competitive Business; 
	 
	 	(d)	recruit or hire any Person who is
      Franchisor’s employee or the employee of any Krispy Kreme Store or
      Commissary Facility, or who has been Franchisor’s employee or the employee
      of any Krispy Kreme Store or Commissary Facility within the past six (6)
      months without obtaining prior written permission from Franchisor and that
      Person’s employer. If Franchisor permits Franchisee to hire any such
      Person, then Franchisee agrees to pay Franchisor a non-refundable
      Management Development Fee in the amount of Twenty-Five Thousand Dollars
      ($25,000) per hired employee as of the date of hire; or 
	 
	 	(e)	induce or attempt to induce any
      Person who is Franchisor’s employee or the employee of any Krispy Kreme
      Store or Commissary Facility to discontinue working for Franchisor or such
      Krispy Kreme Store or Commissary Facility as the case may be.

	 
	 	Franchisee and each of
      its Owners expressly acknowledges the possession of skills and abilities
      of a general nature and other opportunities for exploiting such skills in
      other ways, so that enforcement of the covenants contained in
      Section 27.3 will not deprive any of them their personal goodwill or ability to
      earn a living. If Franchisee or any of its Owners fails or refuses to
      abide by any of the foregoing covenants and Franchisor obtains enforcement
      in a judicial or arbitration proceeding, the obligations under the
      breached covenant will be tolled during the period(s) of time that the
      covenant is breached and/or Franchisor seeks to enforce it and will
      continue in effect for a period of time ending two (2) years after the
      date of the order enforcing the covenant. 
	 
	27.4	Upon termination or
      expiration (without renewal) of this Agreement, Franchisor shall have the
      right, exercisable by giving notice thereof within thirty (30) days after
      the date of such termination or expiration, to purchase (and, if
      necessary, take possession of and remove from the Site) any and all
      equipment used or useable at the FACILITY (including all equipment that
      contains or embodies patents 

D-32

		
      owned by Franchisor or any of its
      Affiliates) at its net book value, determined in accordance with generally
      accepted accounting principles, consistently applied. This right is
      separate and apart from Franchisor’s rights under Section 27.5.

		 
	27.5	Upon termination or expiration
      (without renewal) of this Agreement, Franchisor shall have the right,
      exercisable by giving notice thereof (“Appraisal Notice”) within thirty
      (30) days after the date of such termination or expiration, to require
      that a determination be made of the “Fair Market Value” (as defined below)
      of any or all of the assets of the FACILITY which Franchisee owns,
      including inventory of non-perishable products, materials, supplies,
      furniture, equipment, signs, and any and all leasehold improvements,
      fixtures, building and land, but excluding any cash and short-term
      investments and any items not meeting Franchisor’s specifications for
      Commissary Facilities (the “Purchased Assets”). Notwithstanding the
      foregoing, if Franchisee notifies Franchisor not less than one hundred
      eighty (180) days nor more than two hundred seventy (270) days prior to
      the expiration of this Agreement that Franchisee does not desire to enter
      into a successor franchise agreement on expiration, then Franchisor
      agrees, if Franchisor desires to exercise its right to purchase, to give
      Franchisee the Appraisal Notice at least one hundred twenty (120) days
      prior to the date of expiration of this Agreement. 
	              
    	
	27.6	Upon delivery of the Appraisal
      Notice, Franchisee may not sell or remove any of the assets of the
      FACILITY from the Premises (other than in the ordinary course of business)
      and must give Franchisor, its designated agents and the “Appraisers” (as
      defined below) full access to the FACILITY and all of Franchisee’s books
      and records at any times during customary business hours in order to
      conduct inventories and determine the purchase price for the Purchased
      Assets. 
	 
	27.7	The Fair Market Value shall be
      defined as the amount at which an arm’s length purchaser would be willing
      to pay for the Purchased Assets, assuming that the Purchased Assets would
      be used for the operation of a Commissary Facility under a valid franchise
      agreement reflecting the then-current (or if Franchisor is not offering
      franchises at that time, then the most recent) standard terms upon which
      Franchisor offers franchises for Commissary Facilities. Under no
      circumstances will any value be attributed to any goodwill associated with
      the Marks or any value attributed to the System (all of which Franchisee
      acknowledges to be owned by Franchisor and its Affiliates). In the first
      instance, Fair Market Value shall be determined by consultation between
      Franchisor and Franchisee. If Franchisee and Franchisor are unable to
      agree on the Fair Market Value of the Purchased Assets within fifteen (15)
      days after the Appraisal Notice, then Fair Market Value will be determined
      by calculating the mean average of three (3) separate appraisals done by
      three (3) independent appraisers (“Appraisers”). Franchisor and Franchisee
      shall each designate one (1) Appraiser within thirty (30) days of the
      Appraisal Notice and the two (2) Appraisers so designated will select a
      third (3rd) Appraiser within ten (10) days thereafter. If the two
      designated Appraisers are unable to select a third (3rd) Appraiser within
      such ten (10) days, then the third (3rd) Appraiser shall be selected, on
      demand of either party, by the director of the Regional Office of the
      American Arbitration Association located nearest to Winston-Salem, North
      Carolina. 
	 
	27.8	Each Appraiser will make his or
      her determination and submit a written report (“Appraisal Report”) to
      Franchisee and Franchisor as soon as practicable, but in no event more
      than thirty (30) days after his or her appointment. Each party may submit
      in writing to the Appraisers its judgment of Fair Market Value (together
      with its reasons therefor and with copies to each other); however, the
      Appraisers shall not be limited to these submissions and may make such
      independent investigations as they reasonably determine to be necessary.
      The Appraisers’ fees and costs shall be borne equally by the
      parties. 
	 
	27.9	Franchisor has the option,
      exercisable by delivering notice thereof within thirty (30) days after
      submission of the last Appraisal Report (or the date that an agreement is
      reached, if the parties agree to the Fair Market Value), to agree to
      purchase the Purchased Assets at the Fair Market Value, as so determined.
      Franchisor shall have the unrestricted right to assign this option to
      purchase separate and apart from the remainder of this
  Agreement.

D-33

	27.10	If Franchisor exercises its
      option to purchase, the purchase price for the Purchased Assets will be
      paid in cash at the closing, which will occur at the place, time and date
      Franchisor designates, but not later than sixty (60) days after the
      exercise of Franchisor’s option to purchase the Purchased Assets. At the
      closing, Franchisor will be entitled to all representations, warranties,
      covenants, title insurance policies and other closing documents and
      post-closing indemnifications and hold-backs as Franchisor reasonably
      requires, including: (a) instruments transferring good and marketable
      title to the Purchased Assets, free and clear of all liens, encumbrances,
      and liabilities, to Franchisor or its designee, with all sales and other
      transfer taxes paid by Franchisee; (b) an assignment of all leases of
      assets used in the operation of the FACILITY, including land, building
      and/or equipment (or if an assignment is prohibited, a sublease to
      Franchisor or its designee for the full remaining term and on the same
      terms and conditions as Franchisee’s lease, including renewal and/or
      purchase options), provided, however, that if any of Franchisee’s Owners
      or Affiliates directly or indirectly owns the land, building and/or
      equipment of the FACILITY, Franchisee will, at Franchisor’s option, cause
      such Owner or Affiliate to grant to Franchisor a lease at reasonable and
      customary rental rates and other terms prevailing in the community where
      the FACILITY is located; and (c) a general release by Franchisee and its
      Owners and Affiliates in form and substance satisfactory to
      Franchisor. 
	              
    	
	27.11	If Franchisee cannot deliver
      clear title to all of the Purchased Assets, or if there are other
      unresolved issues, the closing of the sale may, at Franchisor’s option, be
      accomplished through an escrow on such terms and conditions as Franchisor
      deems appropriate, including the making of payments, to be deducted from
      the purchase price, directly to third parties in order to obtain clear
      title to all of the Purchased Assets. Further, Franchisee and Franchisor
      shall comply with any applicable Bulk Sales provisions of the Uniform
      Commercial Code as enacted in the state where the FACILITY is located and
      all applicable state and local sales and income tax notification and/or
      escrow procedures. Franchisor has the right to set off against and reduce
      the purchase price by any and all amounts owed by Franchisee or any of its
      Owners or Affiliates to Franchisor or any of its Affiliates.
	 
	27.12	Upon delivery of the Appraisal
      Notice and pending (a) determination of Fair Market Value, (b)
      Franchisor’s option period, and (c) the closing of the purchase,
      Franchisor may authorize continued temporary operations of the FACILITY
      pursuant to the terms of this Agreement, subject to the supervision and
      control of one or more of Franchisor’s appointed managers. 
	 	
	27.13	Franchisor’s exercise of any of
      its rights under Section 27
      will be in addition to and not in
      limitation of any other rights and remedies it may have in the event of
      any breach or default by Franchisee. 
	 
	27.14	All the obligations of Franchisee
      and its Owners and Affiliates under this Agreement, which expressly or by
      their nature survive or are intended to survive the termination or
      expiration of this Agreement, will continue in full force and effect
      subsequent to and notwithstanding the termination or expiration until they
      are satisfied in full or by their nature expire. 
	 
	28.	RELATIONSHIP OF
      PARTIES/INDEMNIFICATION 
	 
	28.1	Neither this Agreement nor the
      dealings of the parties pursuant to this Agreement shall create any
      fiduciary relationship or any other relationship of trust or confidence
      between the parties hereto. Franchisor and Franchisee, as between
      themselves, are and shall be independent contractors. 
	 	
	28.2	Franchisee understands and agrees
      that Franchisor may operate and change the System and its business in any
      manner that is not expressly and specifically prohibited by this
      Agreement. Whenever Franchisor has expressly reserved in this Agreement or
      is deemed to have a right and/or discretion to take or withhold an action,
      or to grant or decline to grant Franchisee a right to take or withhold an
      action, except as otherwise expressly and specifically provided in this
      Agreement, Franchisor may make its decision or exercise its right and/or
      discretion on the basis of its judgment of what is in its best interests,
      including its judgment of what is in the best interests of its franchise
      network, at the time its decision is made or its right or discretion is
      exercised, without regard to whether: (a) other reasonable alternative
      decisions or actions could have been made by Franchisor; (b) Franchisor’s
      decision or action promotes its financial or other individual interest;
      (c) Franchisor’s decision or action applies differently to Franchisee and
      one 

D-34

		
      or more other franchisees or its
      company-owed operations; or (d) Franchisor’s decision or the exercise of
      its right or discretion is adverse to Franchisee’s interests. In the
      absence of an applicable statute, Franchisor will have no liability to
      Franchisee for any such decision or action. The parties intend that the
      exercise of Franchisor’s right or discretion will not be subject to
      limitation or review. If applicable law implies a covenant of good faith
      and fair dealing in this Agreement, the parties agree that such covenant
      shall not imply any rights or obligations that are inconsistent with a
      fair construction of the terms of this Agreement and that this Agreement
      grants Franchisor the right to make decisions, take actions and/or refrain
      from taking actions not inconsistent with Franchisee’s rights and
      obligations hereunder.

      Nothing contained in this Agreement,
      nor arising from the conduct of the parties hereunder, is intended to make
      either party a general or special agent, joint venturer, partner or
      employee of the other for any purpose whatsoever. Franchisee must
      conspicuously identify itself in all dealings with customers, lessors,
      contractors, suppliers, public officials, employees and others as the
      owner of the rights granted hereunder and must place such other notices of
      independent ownership on such forms, business cards, stationery,
      advertising and other materials as we may require from time to time.
      Franchisee is solely responsible for all employment decisions with respect
      to its personnel, including hiring, firing, compensation, training,
      supervision and discipline, and regardless whether Franchisee receives
      advise from Franchisor on any of these subjects.

	              
    	 
	28.3	Franchisee may not make any
      express or implied agreements, warranties, guarantees or representations
      or incur any debt in Franchisor’s name or on its behalf or represent that
      the relationship of the parties hereto is anything other than that of
      independent contractors. Franchisor will not be obligated by or have any
      liability under any agreements made by Franchisee with any third party or
      for any representations made by Franchisee to any third party. Franchisor
      will not be obligated for any damages to any person or property arising
      directly or indirectly out of the operation of Franchisee’s business
      hereunder. 
	 
		
	28.4	Franchisor will have no liability
      for any sales, use, service, occupation, excise, gross receipts, income,
      property or other taxes, whether levied upon Franchisee or the FACILITY,
      in connection with the business Franchisee conducts (except for taxes
      Franchisor is required by law to collect from Franchisee with respect to
      purchases from Franchisor). Payment of all such taxes is Franchisee’s
      responsibility. 
	 
	28.5	Franchisor agrees to indemnify
      Franchisee against, and to reimburse Franchisee for, all damages for which
      Franchisee is held liable as a result of a claim that Franchisee’s
      authorized use of any Mark or of any of Franchisor’s other intellectual
      property rights pursuant to and in full compliance with this Agreement
      infringes on the rights of another person and, except as provided herein,
      for all costs Franchisee reasonably incurs in defending any such claim
      brought against Franchisee, provided that Franchisee has timely notified
      Franchisor of such claim and provided further that Franchisee and
      Franchisee’s Principal Owners and Affiliates are in full compliance with
      this Agreement and with all other agreements entered into with Franchisor
      or any of its Affiliates. HDN Development Corporation or its agent or
      assignee, at its sole discretion, is entitled to prosecute, defend and/or
      settle any such proceeding arising out of Franchisee’s use of any Mark or
      other intellectual property right pursuant to this Agreement and, if HDN
      Development Corporation or its agent or assignee undertakes to prosecute,
      defend and/or settle any such matter, Franchisor, HDN Development
      Corporation or its agent or assignee, has no obligation to indemnify or
      reimburse Franchisee for any fees or disbursements of any legal counsel
      retained by Franchisee. 
	 
	28.6	Franchisee agrees to indemnify
      Franchisor, its Affiliates and their respective directors, officers,
      employees, shareholders, members, managers, agents, successors and assigns
      (collectively “Indemnified
      Parties”), and to hold the Indemnified
      Parties harmless to the fullest extent permitted by law, from any and all
      losses and expenses (as defined below) incurred in connection with any
      litigation or other form of adjudicatory procedure, claim, demand,
      investigation, or formal or informal inquiry (regardless of whether it is
      reduced to judgment) or any settlement thereof which arises directly or
      indirectly from, or as a result of, a claim of a third party against any
      one or more of the Indemnified Parties, including those in connection with
      (a) Franchisee’s failure to perform or breach of any covenant, agreement,
      term or provision of this Agreement, (b) Franchisee’s breach of any
      representation or warranty contained in this Agreement, (c)
  

D-35

		
      Franchisee’s marketing, promotion,
      advertisement or sale of any of the products and services offered by the
      FACILITY, including unfair or fraudulent advertising claims (whether in
      print advertising, electronic media or otherwise), and product liability
      claims, (d) Franchisee’s development, ownership, operation and/or closing
      of the FACILITY, (e) Franchisee’s failure to pay any amounts owed to a
      supplier, (f) claims by Franchisee’s employees (including workers’ or
      unemployment compensation), (g) personal injury claims, (h) Franchisee’s
      failure to comply with any law, and (i) any allegedly unauthorized service
      or act, rendered or performed in connection with this Agreement,
      (collectively “Event”) and regardless of whether it resulted from any strict
      or vicarious liability imposed by law on the Indemnified Parties. The
      foregoing indemnity shall apply even if it is determined that the
      Indemnified Parties’ negligence caused such loss, liability or expense, in
      whole or in part, provided, however, that this indemnity will not apply to
      any liability arising from a breach of this Agreement by Franchisor or
      with respect to any Indemnified Party whose gross negligence or willful
      acts caused such liability (except to the extent that joint liability is
      involved, in which event the indemnification provided herein will extend
      to any finding of comparative or contributory negligence attributable to
      Franchisee). The term “losses and
      expenses” includes compensatory,
      exemplary, and punitive damages; fines and penalties; attorneys’ fees;
      experts’ fees; court costs; costs associated with investigating and
      defending against claims; settlement amounts; judgments; compensation for
      damages to our reputation and goodwill; and all other costs associated
      with any of the foregoing losses and expenses. Franchisor agrees to give
      Franchisee reasonable notice of any event of which Franchisor becomes
      aware for which indemnification may be required, and Franchisor may elect
      (but is not obligated) to direct the defense thereof, provided that the
      selection of counsel shall be subject to Franchisee’s consent, which
      consent shall not be unreasonably withheld or delayed. Franchisor may, in
      its reasonable discretion, take such actions as Franchisor deems necessary
      and appropriate to investigate, defend, or settle any Event or take other
      remedial or corrective actions with respect thereto as may be necessary
      for the protection of the Indemnified Parties or Krispy Kreme Stores
      generally, provided however, that any settlement (to the extent payment is
      made by Franchisee) shall be subject to Franchisee’s consent, which
      consent shall not be unreasonably withheld or delayed. Further,
      notwithstanding the foregoing, if the insurer on a policy or policies
      obtained in compliance with this Agreement agrees to undertake the defense
      of an Event (an “Insured Event”), Franchisor agrees not to exercise its
      right to select counsel to defend the Event if such would cause
      Franchisee’s insurer to deny coverage. Franchisor reserves the right to
      retain counsel to represent Franchisor with respect to an Insured Event at
      Franchisor’s sole cost and expense.

	              
    	
	28.7	In furtherance of the indemnity contained in
      Section 28.6, during the Term, Franchisee agrees to maintain commercial general
      liability insurance, product liability coverage, automobile liability
      insurance, worker’s compensation insurance, employer’s liability insurance
      and any other insurance policies as Franchisor may require from time to
      time, insuring Franchisee and the Indemnified Parties against the matters
      described in Section 28.6, including claims for bodily and personal
      injury, death and property damage, among other things, caused by or
      occurring in conjunction with the conduct of business by Franchisee
      pursuant to this Agreement, under one or more policies of insurance
      acceptable to Franchisor and containing minimum liability coverage
      Franchisor prescribes from time to time. Each such insurance policy will
      name Franchisor as an additional insured and will provide for thirty (30)
      days’ prior written notice to Franchisor of any material modification,
      cancellation, or expiration of such policy. Each such insurance policy
      will give Franchisor notice of default under the policy and the
      opportunity to cure such default on Franchisee’s behalf. Simultaneous with
      the execution of this Agreement, Franchisee will provide Franchisor with
      evidence of such insurance; thereafter, Franchisee will furnish to
      Franchisor annually and upon the replacement or material modification of
      any insurance policy providing the coverage required under this Agreement,
      a copy of the certificate of insurance or other evidence requested by
      Franchisor that such insurance coverage is continuously in force without
      interruption. The maintenance of sufficient insurance coverage (both as to
      the type and limits of coverage) for the FACILITY is Franchisee’s sole
      responsibility. 
	 	
	28.8	The terms of Section
      28 will survive the termination or
      expiration of this Agreement. 

D-36

	29.	MISCELLANEOUS 
	              
    	
	29.1	This Agreement and all issues arising from or relating
      to this Agreement shall be governed by and construed under the laws of the
      State of North Carolina, provided the foregoing shall not constitute a
      waiver of Franchisee’s rights under any applicable franchise law of
      another state. Otherwise, in the event of any conflict of law, North
      Carolina law will prevail, without regard to the application of North
      Carolina conflict of law principles, except that any North Carolina law
      regulating the sale of franchises or business opportunities or governing
      the relationship of a franchisor and its franchisees will not apply unless
      its jurisdictional requirements are met independently without reference to
      this section. 
	 
	29.2	Franchisee and each of its Owners agree that the U.S.
      District Court for the Middle District of North Carolina, or if such court
      lacks jurisdiction, the Superior Court (or its successor) for Forsyth
      County North Carolina, shall be the venue and exclusive forum in which to
      adjudicate any case or controversy arising from or relating to this
      Agreement, or any Development Agreement, Franchise Agreement or any other
      Commissary Facility Agreement, including any guarantees or covenants by
      Franchisee’s Owners. In the event a case or controversy is to be heard by
      the Superior Court (or its successor) for Forsyth County North Carolina,
      any party may request that the matter be assigned to the North Carolina
      Business Court. Franchisee and each of its Owners irrevocably submit to
      the jurisdiction of such courts and waive any objections to either the
      jurisdiction of or venue in such courts. Franchisee and each of its Owners
      irrevocably waive, to the fullest extent they may lawfully do so, the
      defense of an inconvenient forum to the maintenance of such suit, action
      or proceeding and agree that service of process for purposes of any such
      suit, action or proceeding need not be personally served or served within
      the State of North Carolina but may be served with the same effect as if
      they were served within the State of North Carolina, by certified mail or
      any other means permitted by law, addressed to Franchisee and its Owners
      (as applicable) at the address set forth herein. Nothing contained herein
      shall affect Franchisor’s rights to bring a suit, action or proceeding in
      any other appropriate jurisdiction, including any suit, action or
      proceeding brought by Franchisor to enforce any judgment against
      Franchisee or any of its Owners entered by a State or Federal
      Court. 
	 
	29.3	Franchisor may obtain at any time in any court of
      competent jurisdiction any injunctive relief, including temporary
      restraining orders and preliminary injunctions, against conduct or
      threatened conduct for which no adequate remedy at law may be available or
      which may cause Franchisor irreparable harm. Franchisor may have such
      injunctive relief, without bond, but upon due notice, in addition to such
      further and other relief as may be available at equity or in law, and
      Franchisee’s sole remedy in the event of the entry of such injunction,
      shall be the dissolution of such injunction, if warranted, upon hearing
      duly had (all claims for damages by reason of the wrongful issuance of any
      such injunction being expressly waived hereby). Franchisee and each of its
      Owners acknowledges that any violation of Sections 16, 17.3, 18, 19, 20, 24.3(j) or
      27.3 would result in irreparable injury to Franchisor for which no
      adequate remedy at law may be available. Accordingly, Franchisee and each
      of its Owners consent to the issuance of an injunction at Franchisor’s
      request (without posting a bond or other security) prohibiting any conduct
      in violation of any of those sections and agree that the existence of any
      claims Franchisee or any of its Owners may have against Franchisor,
      whether or not arising herefrom, shall not constitute a defense to the
      enforcement of any of those Sections. 
	 	
	29.4	If Franchisor claims in any judicial proceeding that
      Franchisee owes Franchisor or any of its Affiliates money or that
      Franchisee has otherwise breached this Agreement and Franchisor prevails
      on such claims, then Franchisor shall be awarded its costs and expenses
      incurred in connection with such proceedings, including reasonable
      attorneys’ fees. 
	 
	29.5	Except with respect to any of Franchisee’s obligations
      herein regarding the Confidential Information, the Marks, and any other
      intellectual property rights of Franchisor, Franchisor and Franchisee (and
      its Owners) each waives, to the fullest extent permitted by law, any right
      to or claim for any punitive or exemplary damages against the other.
      Franchisee and each of its Owners waives, to the fullest extent permitted
      by applicable law, the right to recover consequential damages for any
      claim directly or indirectly arising from or relating to this Agreement.
      FURTHERMORE, THE PARTIES
      AGREE 

D-37

		
      THAT ANY LEGAL ACTION IN
      CONNECTION WITH THIS AGREEMENT SHALL BE TRIED TO THE COURT SITTING WITHOUT
      A JURY, AND ALL PARTIES WAIVE ANY RIGHT TO HAVE ANY ACTION TRIED BY
      JURY. 

	              
    	
	29.6	Every part of this Agreement shall be considered
      severable. If for any reason any part of this Agreement is held to be
      invalid, that determination shall not impair the other parts of this
      Agreement. If any covenant herein which restricts competitive activity is
      deemed unenforceable by virtue of its scope in terms of geographical area,
      type of business activity prohibited and/or length of time, but could be
      rendered enforceable by reducing any part or all of it, Franchisee and
      Franchisor agree that it will be so modified as to remain enforceable to
      the fullest extent permissible under applicable law. If any applicable law
      requires a greater prior notice of the termination of or refusal to enter
      into a successor franchise than is required hereunder, a different
      standard of “good cause”, or the taking of some other action not required
      hereunder, the prior notice, “good cause” standard and/or other action
      required by such law shall be substituted for the comparable provisions
      hereof. If any provision of this Agreement or any specification, standard
      or operating procedure prescribed by Franchisor is invalid or
      unenforceable under applicable law, Franchisor has the right, in its sole
      discretion, to modify such invalid or unenforceable provision,
      specification, standard or operating procedure to the extent required to
      make it valid and enforceable. 
	 
	29.7	Franchisor and Franchisee may by written instrument
      signed by the waiving party unilaterally waive or reduce any obligation of
      the other under this Agreement. Any waiver granted by Franchisor shall be
      without prejudice to any other rights Franchisor may have, will be subject
      to continuing review by Franchisor and may be revoked, in its sole
      discretion, at any time and for any reason, effective upon delivery to
      Franchisee of 10 days’ prior notice. Franchisee and Franchisor shall not
      be deemed to have waived any right reserved by this Agreement by virtue of
      any custom or practice of the parties at variance with it; any failure,
      refusal or neglect by Franchisee or Franchisor to exercise any right under
      this Agreement or to insist upon exact compliance by the other with its
      obligations hereunder; any waiver, forbearance, delay, failure or omission
      by Franchisor to exercise any right, whether of the same, similar or
      different nature, with respect to other Commissary Facilities; or the
      acceptance by Franchisor of any payments due from Franchisee after any
      breach of this Agreement. 
	 
	29.8	The rights of Franchisor and Franchisee hereunder are
      cumulative and no exercise or enforcement by Franchisor or Franchisee of
      any right or remedy hereunder shall preclude the exercise or enforcement
      by Franchisor or Franchisee of any other right or remedy hereunder which
      Franchisor or Franchisee is entitled to enforce by law. 
	 
	29.9	The language of this Agreement shall be construed
      according to its fair meaning and not more strictly against any one party
      than the other. The Basic Terms, introduction, personal guarantees and
      covenants, exhibits, schedules and riders (if any) to this Agreement are a
      part of this Agreement, which constitutes the entire agreement of the
      parties with respect to the subject matter hereof. Except as otherwise
      expressly provided herein, there are no other oral or written agreements,
      understandings, representations or statements relating to the subject
      matter of this Agreement, other than the Franchise Disclosure Document,
      that either party may or does rely on or that will have any force or
      effect. Nothing in this Agreement shall be deemed to confer any rights or
      remedies on any person or legal entity not a party hereto. This Agreement
      shall not be modified except by written agreement signed by both
      parties. 
	 
	29.10	The headings of sections are for convenience only and do
      not limit or construe their contents. The word “including” shall be
      construed to include the words “without limitation.” The term “Franchisee”
      is applicable to one or more persons, a corporation, limited liability
      company or a partnership and its owners, as the case may be. If two or
      more persons are at any time Franchisee hereunder, whether as partners,
      joint venturers or otherwise, their obligations and liabilities to
      Franchisor shall be joint and several. 
	 
	29.11	References to a controlling interest in an entity shall
      mean more than fifty percent (50%) of the equity and voting control of
      such entity. 

D-38

	29.12	This Agreement is binding on the
      parties hereto and their respective executors, administrators, heirs,
      assigns and successors in interest. This Agreement may be executed in
      multiple copies, each of which shall be deemed an original. Time is of the
      essence in this Agreement. 
	 
	29.13	Whenever this Agreement requires
      the approval or consent of either party, the other party shall make
      written request therefor, and such approval or consent shall be obtained
      in writing; provided however, unless specified otherwise in this
      Agreement, such party may withhold approval or consent for any reason or
      for no reason at all. Furthermore, unless specified otherwise in this
      Agreement, no such approval or consent shall be deemed to constitute a
      warranty or representation of any kind, express or implied, and the
      approving or consenting party shall have no responsibility, liability or
      obligation arising therefrom. 
	 
	29.14	All notices, requests and reports
      permitted or required to be delivered by this Agreement shall be deemed
      delivered: (a) at the time delivered by hand to the recipient party (or to
      an officer, director or partner of the recipient party); (b) one (1)
      business day after being placed in the hands of a commercial courier
      service for guaranteed overnight delivery; or (c) five (5) business days
      after placement in the United States Mail by Registered or Certified Mail,
      Return Receipt Requested, postage prepaid and addressed to the party to be
      notified at its most current principal business address of which the
      notifying party has been notified in writing. All payments and reports
      required by this Agreement shall be sent to Franchisor at the address
      identified in this Agreement unless and until a different address has been
      designated by written notice. No restrictive endorsement on any check or
      in any letter or other communication accompanying any payment shall bind
      Franchisor, and its acceptance of any such payment shall not constitute an
      accord and satisfaction. 
	 	
	30.	ACKNOWLEDGMENTS
  
	 
	30.1	By initialing below, Franchisee
      hereby specifically acknowledges the following: 
	 
	 	(a)	Domicile. Franchisee
      acknowledges that Franchisee is not a domiciliary or a resident of any
      state, other than the state where the FACILITY is located or, if
      different, the state listed in the Basic Terms as Franchisee’s
      address. 
	              
    	              
    	
	 	 	Initials
      ________/________ 
	 
	 	(b)	Receipt of Franchise Disclosure Document.
      Franchisee acknowledges having received
      Franchisor’s Franchise Disclosure Document at least fourteen (14) calendar
      days before signing a binding agreement or before making any payment to
      Franchisor or any of its Affiliates relating to this Agreement. Franchisee
      has read and understands Franchisor’s Franchise Disclosure Document.
      
	 	 	
	 	 	Initials
      ________/________ 
	 
	 	(c)	No Inconsistent Representations. Franchisee acknowledges that no representations have
      been made to Franchisee which are inconsistent with information presented
      in Franchisor’s Franchise Disclosure Document, and Franchisee has not
      relied on any representations inconsistent with or not contained in
      Franchisor’s Franchise Disclosure Document. 
	 
	 	 	Initials
      ________/________ 
	 
	 	(d)	Business Risks; Independent Investigation.
      Franchisee recognizes that the nature
      of Krispy Kreme Stores and Commissary Facilities may change over time,
      that an investment in a Krispy Kreme Store or Commissary Facility involves
      business risks and that the success of the investment is largely dependent
      on Franchisee’s own business abilities, efforts and financial resources.
      Franchisee has conducted an independent investigation of the business
      contemplated by this Agreement and recognizes that the food service
      industry is highly competitive. 
	 
	 	 	Initials ________/________ 

D-39

		(e)	Independent Counsel.
      Franchisee acknowledges having had the
      opportunity to seek independent counsel concerning the execution of this
      Agreement and the operation of the Franchise. 
	              
    	              
    	
		 	Initials
      ________/________ 
		 
		(f)	No Guarantee or Assurance.
      Franchisee has not received from
      Franchisor or its representatives or relied on any statement,
      representation, guaranty or assurance, express or implied, as to the
      revenues, profits or success of the business venture contemplated by this
      Agreement, nor has Franchisee received from Franchisor or its
      representatives any information from which Franchisee may easily ascertain
      a specific level or range of actual or potential sales, income, gross or
      net profits from franchised or non-franchised Krispy Kreme Stores or
      Commissary Facilities. 
		 
		 	Initials
      ________/________ 

IN WITNESS WHEREOF, the parties hereto have executed and delivered this Agreement
as of the Effective Date.

	KRISPY KREME DOUGHNUT  		[FRANCHISEE]  
	CORPORATION  	              
    	  
	  
	By: 
    	 	  	By: 
    	 

	Title:  	 	              
    	Title:  	 

	Dated:  	 	              
    	Dated:  	 

D-40

EXHIBIT E

TO THE DEVELOPMENT AGREEMENT
BETWEEN
KRISPY KREME DOUGHNUT CORPORATION
AND
_____________________________
DATED____________,__________
 
PRINCIPAL OWNERS’ PERSONAL GUARANTY
OF FRANCHISEE’S OBLIGATIONS
(“Guaranty”)

     In
consideration of, and as an inducement to, the execution of the Krispy Kreme
Doughnut Corporation Development Agreement dated as of __________,__________
(the “Agreement”) by and between KRISPY KREME DOUGHNUT CORPORATION
(“Franchisor”), and _____________ (“Franchisee”), each of the undersigned
Principal Owners of a ten percent (10%) or greater interest in Franchisee hereby
personally and unconditionally: (a) guarantees to Franchisor and its successors
and assigns, for the term of the Agreement and thereafter as provided in the
Agreement, that Franchisee shall punctually pay and perform each and every
undertaking, agreement and covenant set forth in the Agreement (and any
amendments) and that each and every representation of Franchisee made in
connection with the Agreement (and any amendments) are true, correct and
complete in all respects at and as of the time given; and (b) agrees personally
to be bound by each and every provision in the Agreement (and any
amendments).

     Each of the
undersigned waives: (a) acceptance and notice of acceptance by Franchisor of the
foregoing undertakings; (b) notice of demand for payment of any indebtedness or
nonperformance of any obligations hereby guaranteed; (c) protest and notice of
default to any party with respect to the indebtedness or nonperformance of any
obligations hereby guaranteed; (d) any right that the undersigned may have to
require that an action be brought against Franchisee or any other person as a
condition of liability; (e) notice of any amendment to the Agreement; (f) any
and all other notices and legal or equitable defenses to which that the
undersigned may be entitled; and (g) the provisions of N.C. General Statutes §
26.7 et seq.

     Each of the
undersigned consents and agrees that: (a) that the undersigned’s direct and
immediate liability under this guaranty shall be joint and several; (b) that the
undersigned shall render any payment or performance required under the Agreement
upon demand if Franchisee fails or refuses to do so punctually; (c) such
liability shall not be contingent or conditioned upon pursuit by Franchisor of
any remedies against Franchisee or any other person; and (d) such liability
shall not be diminished, relieved or otherwise affected by any extension of
time, credit or other indulgence which Franchisor may from time to time grant to
Franchisee or to any other person including the acceptance of any partial
payment or performance or the compromise or release of any claims, none of which
shall in any way modify or amend this Guaranty, which shall be continuing and
irrevocable until satisfied in full.

     Each of the
undersigned agrees that the U.S. District Court for the Middle District of North
Carolina, or if such court lacks jurisdiction, the Superior Court (or its
successor) for Forsyth County, North Carolina, shall be the venue and exclusive
forum in which to adjudicate any case or controversy arising from or relating to
this Guaranty. In the event a case or controversy is to be heard by the Superior
Court (or its successor) for Forsyth County, North Carolina, any party may
request that the matter be assigned to the North Carolina Business Court. Each
of the undersigned irrevocably submits to the jurisdiction of such courts and
waives any objections to either the jurisdiction of or venue in such courts.
Each of the undersigned irrevocably waives, to the fullest extent he/she may
lawfully do so, the defense of an inconvenient forum to the maintenance of such
suit, action or proceeding and agrees that service of process for purposes of
any such suit, action or proceeding need not be personally served or served
within the State of North Carolina but may be served with the same effect as if
the undersigned were served within the State of North Carolina, by certified
mail or any other means permitted by law addressed to the 

E-1

undersigned at the address set forth
herein. Nothing contained herein shall affect Franchisor’s rights to bring a
suit, action or proceeding in any other appropriate jurisdiction, including any
suit, action or proceeding brought by Franchisor to enforce any judgment against
the undersigned entered by a State or Federal Court.

     Each of the
undersigned waives all rights to payments and claims for reimbursement or
subrogation which any of the undersigned may have against Franchisee arising as
a result of the undersigned’s execution of and performance under this
Guaranty.

 

 

 

 

[This space intentionally left
blank.]

 

 

 

E-2

     IN
WITNESS WHEREOF, each of the undersigned has
hereunto affixed his/her signature as of the _____ day of
__________,__________.

	PERCENTAGE OF
      OWNERSHIP  	          	GUARANTOR(S)  
	INTERESTS IN
      FRANCHISEE  		  
	 		  
	  		(Signature)  
			 
	  		(Print
      Name)  
			 
			 
	  		(Address)  
	 		 
	  		(Signature)  
			 
	  		(Print
      Name)  
			 
			 
	  		(Address)  
	 		 
	  		(Signature)  
			 
	  		(Print
      Name)  
			 
			 
	  		(Address)  
	 		 
	  		(Signature)  
			 
	  		(Print
      Name)  
			 
			 
	  		(Address)  
			 

Subscribed and sworn to before me
this
____ day of ________, _______.

____________________________ 
Notary Public
My Commission
expires:_________

E-3

EXHIBIT F

TO THE DEVELOPMENT AGREEMENT
BETWEEN
KRISPY KREME DOUGHNUT CORPORATION
AND
_____________________________
DATED____________,__________
 
INVESTOR PERSONAL COVENANTS REGARDING
CONFIDENTIALITY, NON-COMPETITION AND NON-SOLICITATION

     In
conjunction with your investment in __________ (“Franchisee”) a ______________,
the undersigned _________________ (“Owner”), acknowledges and agrees as
follows:

     1.
Franchisee owns and operates, or is developing, Krispy Kreme Stores pursuant to
a development agreement dated ____________________, _________ (“Development
Agreement”) with Krispy Kreme Doughnut Corporation (“Franchisor”), which
Development Agreement requires persons with legal or beneficial ownership
interests in Franchisee under certain circumstances to be personally bound by
the confidentiality and noncompetition covenants contained in the Development
Agreement. All capitalized terms contained herein shall have the same meaning
set forth in the Development Agreement.

     2. Owner
owns or intends to own a ______________ percent (__ %) legal or beneficial
ownership interest in Franchisee and acknowledges and agrees that the execution
of this Agreement is a condition to such ownership interest and that Owner has
received good and valuable consideration for executing this Agreement.
Franchisor may enforce this Agreement directly against Owner.

     3. Owner may
gain access to information comprising Franchisor’s Confidential Information as a
result of investing in Franchisee. The Confidential Information is proprietary
and includes Franchisor’s trade secrets. Owner hereby agrees that while Owner
has a legal or beneficial ownership interest in Franchisee and thereafter,
Owner: (a) will not use the Confidential Information in any other business or
capacity; (b) will maintain the confidentiality of the Confidential Information;
and (c) will not make unauthorized copies of any portion of the Confidential
Information, whether through electronic media, writings, or other tangible or
intangible means of expression. Without limiting the foregoing, Owner (i)
acknowledges that he/she may have access to Franchisor’s material non-public
information and that of its parent, Krispy Kreme Doughnut Inc. (“KKDI”), and
that the securities laws prohibit trading in KKDI securities while in possession
of such information, and (ii) agrees to refrain from trading in KKDI securities
in violation of such laws. If Owner ceases to have an interest in Franchisee,
Owner must deliver to Franchisor any such Confidential Information in his/her
possession or control.

     4. Notwithstanding anything to the
contrary contained herein and provided Owner has obtained Franchisor’s prior written consent, the restrictions on
Owner’s disclosure and use of the Confidential Information will not apply to the
following:

	     	(a)	      	information, methods,
      procedures, techniques and knowledge which are or become generally known
      in the food service business, other than through disclosure (whether
      deliberate or inadvertent) by Franchisee, Franchisee’s Owners, agents, or
      employees; and
		 
		(b)		the disclosure of the
      Confidential Information in judicial, arbitration or administrative
      proceedings to the extent that Owner is legally compelled to disclose such
      information, provided Owner has notified Franchisor prior to such
      disclosure and has used its best efforts to obtain, and has afforded
      Franchisor sufficient opportunity to seek an appropriate protective order
      and obtain, assurances satisfactory to Franchisor of confidential
      treatment for the information required to be so
  disclosed.

F-1

     5. Owner acknowledges and agrees
that Franchisor would be unable to (a) protect the Confidential Information against unauthorized use or disclosure; (b)
preserve the prestige, integrity, and goodwill of the Products, Marks, and
System; or (c) encourage the free exchange of ideas and information among Krispy
Kreme Stores and Commissary Facilities if franchisees and owners of Krispy Kreme
Stores and Commissary Facilities or their owners were permitted to engage in or
benefit from certain competitive activities. Therefore, except as expressly
authorized by another written agreement with Franchisor, Owner agrees that
during the term of the Development Agreement or during such time as Owner has an
Ownership Interest in Franchisee (whichever is shorter), without Franchisor’s
prior written consent, Owner shall not directly or indirectly (including through
a Restricted Person):

	     	(i)		have any
      Ownership Interest in a Competitive Business; 
		 
		(ii)		perform
      services as a director, officer, manager, partner, or supervisory or
      management-level employee, of any Competitive
Business;
		 
		(iii)	      	perform
      services as an employee, consultant, representative, agent or otherwise
      for a Competitive Business, where such services could be reasonably
      expected to benefit, either directly or indirectly, whether financially or
      otherwise, from the disclosure of any Confidential Information to such
      Competitive Business;
		 
		(iv)		recruit
      or hire any Person who is Franchisor’s employee or the employee of any
      Krispy Kreme Store or Commissary Facility, or who has been Franchisor’s
      employee or the employee of any Krispy Kreme Store or Commissary Facility
      within the past six (6) months without obtaining prior written permission
      from Franchisor and that Person’s employer. If Franchisor permits Owner to
      hire any such Person, then Owner agrees to pay Franchisor a non-refundable
      Management Development Fee in the amount of Twenty-Five Thousand Dollars
      ($25,000) per hired employee as of the date of hire;
or
		 
		(v)		induce or
      attempt to induce any Person who is Franchisor’s employee or the employee
      of any Krispy Kreme Store or Commissary Facility to discontinue working
      for Franchisor or such Krispy Kreme Store or Commissary Facility as the
      case may be.

     6. Upon termination of the
Development Agreement or Owner’s Ownership Interest in Franchisee (whichever first occurs), Owner shall not directly or
indirectly (including through a Restricted Person) for a period of two (2) years
commencing on the effective date of such termination:

	     	(a)	      	have any
      Ownership Interest in a Competitive Business within the Development Area
      or within a radius of ten (10) miles of any Krispy Kreme Store or
      Commissary Facility then open or under construction; 
		 
		(b)		perform
      services as a director, officer, manager, partner, or supervisory or
      management-level employee, of any Competitive Business within the
      Development Area or within a radius of ten (10) miles of any Krispy Kreme
      Store or Commissary Facility then open or under construction;
      
		 
		(c)		perform
      services as an employee, consultant, representative, agent or otherwise
      for a Competitive Business within the Development Area or within a radius
      of ten (10) miles of any Krispy Kreme Store or Commissary Facility then
      open or under construction, where such services could be reasonably
      expected to benefit, either directly or indirectly, whether financially or
      otherwise, from the disclosure of any Confidential Information to such
      Competitive Business; 
		 
		(d)		recruit
      or hire any Person who is Franchisor’s employee or the employee of any
      Krispy Kreme Store or Commissary Facility, or who has been Franchisor’s
      employee or the employee of any Krispy Kreme Store or Commissary Facility
      within the past six (6) months without obtaining prior written permission
      from Franchisor and that Person’s employer. If Franchisor permits Owner to
      hire any such Person, then Owner agrees to pay Franchisor a non-refundable
      Management Development Fee in the amount of Twenty-Five Thousand Dollars
      ($25,000) per hired employee as of the date of hire; or
  
		 
		(e)		induce or
      attempt to induce any Person who is Franchisor’s employee or the employee
      of any Krispy Kreme Store or Commissary Facility to discontinue working
      for Franchisor or such Krispy Kreme Store or Commissary Facility as the
      case may be. 

F-2

     7. Owner
expressly acknowledges the possession of skills and abilities of a general
nature and the opportunity to exploit such skills in other ways, so that
enforcement of the covenants contained in Sections 5 and 6 of
these covenants will not deprive him/her of his/her personal goodwill or ability
to earn a living. If any covenant herein which restricts competitive activity is
deemed unenforceable by virtue of its scope or in terms of geographic area, type
of business activity prohibited and/or length of time, but could be rendered
enforceable by reducing any part or all of it, Owner agrees that it will be
enforced to the fullest extent permissible under applicable law and public
policy. Franchisor may obtain in any court of competent jurisdiction any
injunctive relief, including temporary restraining orders and preliminary
injunctions, against conduct or threatened conduct for which no adequate remedy
at law may be available or which may cause it irreparable harm. Owner
acknowledges that any violation of Sections 4, 5, or 6 of
these covenants would result in irreparable injury for which no adequate remedy
at law may be available. If Franchisor files a claim to enforce this Agreement
and prevails in such proceeding, Owner agrees to reimburse Franchisor for all
its costs and expenses, including reasonable attorneys’ fees. 

     8. Owner
agrees that the U.S. District Court for the Middle District of North Carolina,
or if such court lacks jurisdiction, the Superior Court (or its successor) for
Forsyth County, North Carolina, shall be the venue and exclusive forum in which
to adjudicate any case or controversy arising from or relating to these
covenants. In the event a case or controversy is to be heard by the Superior
Court (or its successor) for Forsyth County, North Carolina, any party may
request that the matter be assigned to the North Carolina Business Court. Owner
irrevocably submits to the jurisdiction of such courts and waives any objections
to either the jurisdiction of or venue in such courts. Owner irrevocably waives,
to the fullest extent he or she may lawfully do so, the defense of an
inconvenient forum to the maintenance of such suit, action or proceeding and
agrees that service of process for purposes of any such suit, action or
proceeding need not be personally served or served within the State of North
Carolina but may be served with the same effect as if he or she were served
within the State of North Carolina, by certified mail or any other means
permitted by law, addressed to Owner at the address set forth herein. Nothing
contained herein shall affect Franchisor’s rights to bring a suit, action or
proceeding in any other appropriate jurisdiction, including any suit, action or
proceeding brought by Franchisor to enforce any judgment against Owner entered
by a State or Federal Court.

     9. If
Franchisor claims in any judicial proceeding that Owner has breached any of the
covenants contained herein, and Franchisor prevails on such claims, then
Franchisor shall be awarded its costs and expenses incurred in connection with
such proceedings, including reasonable attorneys’ fees.

     IN WITNESS
WHEREOF, the undersigned has executed and delivered this Agreement on the ___
day of _________, ______. 

	OWNER  	
	 	
	(Signature)  	 
	 	
	(Print
      Name)  	
	  	
	 	
	(Address)  	

F-3

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