Krispy Kreme acquires Digital Java, Inc

Krispy Kreme Doughnuts, Inc. (Nasdaq: KREM) announced today the acquisition of Digital Java, Inc., a small Chicago-based coffee company. As a sourcer and micro-roaster of premium quality coffees, Digital Java offered a broad line of coffee-based and non-coffee beverages, both hot and cold. The company also distributed a wide range of manual and automated espresso and coffee equipment and assisted independent retailers to improve their beverage offerings, retail presentation and customer experience.

Scott Livengood, Krispy Kreme CEO, said, "We were very excited to find this unique young company. We believe the Krispy Kreme brand naturally extends to a coffee and beverage offering that is more closely aligned with the hot doughnut experience in our stores. Culminating nearly two years of thought and research, the acquisition achieves a number of strategic goals for us including providing an improved coffee experience to our customers, broadening our beverage offering and increasing our vertical integration. Vertical integration of our coffee business provides the capability to control the sourcing and roasting of our coffee. Increasing control of our supply chain will help ensure quality standards, recipe formulation and roast consistency. With this capability, one of our first priorities will be the research and benchmarking necessary to develop premier blends and roasts of coffee which will help make Krispy Kreme a coffee destination for a broader audience."

Livengood continued, "Beyond coffee, we intend to offer a full line of beverages including espresso-based drinks and frozen beverages. We believe we can substantially increase the proportion of our business devoted to coffee specifically and beverages generally by upgrading and broadening our beverage offering. Digital Java offered the unusual opportunity to acquire passionate and knowledgeable coffee expertise without the distraction and cost of an additional established brand."

The 63-year-old North Carolina-based company is a leading branded specialty retailer of premium quality doughnuts, including the company's signature Hot Original Glazed. Krispy Kreme currently operates 177 stores in 28 states.

Krispy Kreme can be found on the World Wide Web at www.krispykreme.com

Information contained in this press release, other than historical information, may be considered forward-looking in nature and is subject to various risks, uncertainties and assumptions. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, estimated or expected. Among the key factors that may have a direct bearing on Krispy Kreme's operating results, performance or financial condition are its dependence on franchisees to execute its store expansion strategy, supply issues, competition and numerous other factors discussed in Krispy Kreme's periodic reports, proxy statement and other information statements filed with the Securities and Exchange Commission. SOURCE Krispy Kreme Doughnuts, Inc.

CONTACT: investors, Michelle Parman, Senior Vice President of Corporate Development for Krispy Kreme Doughnuts, Inc., 336-733-3762, or media, Stephen Millikin of Laforce & Stevens, 212-242-9353, for Krispy Kreme Doughnuts, Inc./

SOURCE: Krispy Kreme Doughnuts, Inc.