|
x
|
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.
|
¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.
|
Delaware
|
|
20-4145825
|
(State or other jurisdiction of
incorporation or organization)
|
|
(I.R.S. Employer
Identification No.)
|
Title of each class
|
|
Name of each exchange on which registered
|
Common Stock, $0.001 par value per share
|
|
The NASDAQ Global Select Market
|
Large accelerated filer
|
x
|
|
Accelerated filer
|
¨
|
|
|
|
|
|
Non-accelerated filer
|
¨
|
|
Smaller Reporting Company
|
¨
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Page
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Part I.
|
||
Item 1.
|
||
Item 1A.
|
||
Item 1B.
|
||
Item 2.
|
||
Item 3.
|
||
Item 4.
|
||
|
||
Part II.
|
||
Item 5.
|
||
Item 6.
|
||
Item 7.
|
||
Item 7A.
|
||
Item 8.
|
||
Item 9.
|
||
Item 9A.
|
||
Item 9B.
|
||
|
||
Part III.
|
||
Item 10.
|
||
Item 11.
|
||
Item 12.
|
||
Item 13.
|
||
Item 14.
|
||
|
||
Part IV.
|
||
Item 15.
|
Restaurant type
|
Initial franchise
fee*
|
||
Dunkin’ Donuts Single-Branded Restaurant
|
$ 40,000-90,000
|
|
|
Baskin-Robbins Single-Branded Restaurant
|
$
|
25,000
|
|
Dunkin’ Donuts/Baskin-Robbins Multi-Branded Restaurant
|
$ 50,000-100,000
|
|
*
|
Fees effective as of January 1, 2014 and excludes alternative points of distribution
|
Country
|
Type
|
|
Franchised brand(s)
|
|
Number of restaurants
|
|
South Korea
|
Joint Venture
|
|
Dunkin’ Donuts
|
|
902
|
|
|
|
|
Baskin-Robbins
|
|
1,065
|
|
Japan
|
Joint Venture
|
|
Baskin-Robbins
|
|
1,157
|
|
Middle East
|
Master Franchise Agreements
|
|
Dunkin’ Donuts
|
|
338
|
|
|
|
|
Baskin-Robbins
|
|
706
|
|
Item 1A.
|
Risk Factors.
|
•
|
limiting our ability to obtain additional financing to fund future working capital, capital expenditures, acquisitions, or other general corporate requirements;
|
•
|
requiring a substantial portion of our cash flow to be dedicate to debt service payments instead of other purposes, thereby reducing the amount of cash flow available for working capital, capital expenditures, acquisitions, and other general corporate purposes;
|
•
|
increasing our vulnerability to adverse changes in general economic, industry, and competitive conditions;
|
•
|
exposing us to the risk of increased interest rates as certain of our borrowings, including borrowings under the senior credit facility, are at variable rates of interest;
|
•
|
limiting our flexibility in planning for and reacting to changes in the industry in which we compete;
|
•
|
placing us at a disadvantage compared to other, less leveraged competitors or competitors with comparable debt at more favorable interest rates; and
|
•
|
increasing our costs of borrowing.
|
•
|
incur certain liens;
|
•
|
incur additional indebtedness and guarantee indebtedness;
|
•
|
pay dividends or make other distributions in respect of, or repurchase or redeem, capital stock;
|
•
|
prepay, redeem, or repurchase certain debt;
|
•
|
make investments, loans, advances, and acquisition;
|
•
|
sell or otherwise dispose of assets, including capital stock of our subsidiaries;
|
•
|
enter into transactions with affiliates;
|
•
|
alter the business we conduct;
|
•
|
enter into agreements restricting our subsidiaries' ability to pay dividends; and
|
•
|
consolidate, merge, or sell all or substantially all of our assets.
|
•
|
availability of financing;
|
•
|
selection and availability of suitable restaurant locations;
|
•
|
competition for restaurant sites;
|
•
|
negotiation of acceptable lease and financing terms;
|
•
|
securing required domestic or foreign governmental permits and approvals;
|
•
|
consumer tastes in new geographic regions and acceptance of our products;
|
•
|
employment and training of qualified personnel;
|
•
|
impact of inclement weather, natural disasters, and other acts of nature; and
|
•
|
general economic and business conditions.
|
•
|
recessionary or expansive trends in international markets;
|
•
|
changes in foreign currency exchange rates and hyperinflation or deflation in the foreign countries in which we or the International JVs operate;
|
•
|
the imposition of restrictions on currency conversion or the transfer of funds;
|
•
|
availability of credit for our franchisees, licensees, and International JVs to finance the development of new restaurants;
|
•
|
increases in the taxes paid and other changes in applicable tax laws;
|
•
|
legal and regulatory changes and the burdens and costs of local operators' compliance with a variety of laws, including trade restrictions and tariffs;
|
•
|
interruption of the supply of product;
|
•
|
increases in anti-American sentiment and the identification of the Dunkin' Donuts brand and Baskin-Robbins brand as American brands;
|
•
|
political and economic instability; and
|
•
|
natural disasters and other calamities.
|
•
|
variations in our operating performance and the performance of our competitors;
|
•
|
actual or anticipated fluctuations in our quarterly or annual operating results;
|
•
|
publication of research reports by securities analysts about us, our competitors, or our industry;
|
•
|
our failure or the failure of our competitors to meet analysts' projections or guidance that we or our competitors may give to the market;
|
•
|
additions and departures of key personnel;
|
•
|
strategic decisions by us or our competitors, such as acquisitions, divestitures, spin-offs, joint ventures, strategic investments, or changes in business strategy;
|
•
|
the passage of legislation or other regulatory developments affecting us or our industry;
|
•
|
speculation in the press or investment community;
|
•
|
changes in accounting principles;
|
•
|
terrorist acts, acts of war, or periods of widespread civil unrest;
|
•
|
natural disasters and other calamities; and
|
•
|
changes in general market and economic conditions.
|
Item 1B.
|
Unresolved Staff Comments.
|
Item 2.
|
Properties.
|
|
Franchisee-owned points of distribution
|
|
Company-owned points of distribution
|
||
Dunkin’ Donuts—US*
|
7,648
|
|
|
29
|
|
Dunkin’ Donuts—International
|
3,181
|
|
|
—
|
|
Total Dunkin’ Donuts*
|
10,829
|
|
|
29
|
|
Baskin-Robbins—US*
|
2,460
|
|
|
7
|
|
Baskin-Robbins—International
|
4,833
|
|
|
—
|
|
Total Baskin-Robbins*
|
7,293
|
|
|
7
|
|
Total US
|
10,108
|
|
|
36
|
|
Total International
|
8,014
|
|
|
—
|
|
*
|
Combination restaurants, as more fully described below, count as both a Dunkin’ Donuts and a Baskin-Robbins point of distribution.
|
Location
|
Type
|
|
Owned/Leased
|
|
Approximate Sq. Ft.
|
|
Canton, MA
|
Office
|
|
Leased
|
|
175,000
|
|
Braintree, MA (training facility)
|
Office
|
|
Owned
|
|
15,000
|
|
Burbank, CA (training facility)
|
Office
|
|
Leased
|
|
19,000
|
|
Dubai, United Arab Emirates (regional office space)
|
Office
|
|
Leased
|
|
3,200
|
|
Shanghai, China (regional office space)
|
Office
|
|
Leased
|
|
1,700
|
|
Various (regional sales offices)
|
Office
|
|
Leased
|
|
Range of 150 to 300
|
|
Item 3.
|
Legal Proceedings.
|
Item 4.
|
Mine Safety Disclosures
|
Item 5.
|
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.
|
Fiscal Quarter
|
High
|
|
Low
|
||||
2013
|
|
|
|
||||
Fourth Quarter (13 weeks ended December 28, 2013)
|
$
|
49.48
|
|
|
$
|
43.91
|
|
Third Quarter (13 weeks ended September 28, 2013)
|
$
|
46.50
|
|
|
$
|
40.51
|
|
Second Quarter (13 weeks ended June 29, 2013)
|
$
|
43.52
|
|
|
$
|
36.67
|
|
First Quarter (13 weeks ended March 30, 2013)
|
$
|
40.00
|
|
|
$
|
32.32
|
|
|
|
|
|
||||
2012
|
|
|
|
||||
Fourth Quarter (13 weeks ended December 29, 2012)
|
$
|
33.49
|
|
|
$
|
28.62
|
|
Third Quarter (13 weeks ended September 29, 2012)
|
$
|
36.11
|
|
|
$
|
27.93
|
|
Second Quarter (13 weeks ended June 30, 2012)
|
$
|
37.02
|
|
|
$
|
29.58
|
|
First Quarter (13 weeks ended March 31, 2012)
|
$
|
32.44
|
|
|
$
|
24.35
|
|
|
Dividend per share
|
|
Total amount (in thousands)
|
|
Payment date
|
||||
Fiscal year 2013:
|
|
|
|
|
|
||||
First quarter
|
$
|
0.19
|
|
|
$
|
20,191
|
|
|
February 20, 2013
|
Second quarter
|
$
|
0.19
|
|
|
$
|
20,259
|
|
|
June 6, 2013
|
Third quarter
|
$
|
0.19
|
|
|
$
|
20,257
|
|
|
September 4, 2013
|
Fourth quarter
|
$
|
0.19
|
|
|
$
|
20,301
|
|
|
November 26, 2013
|
|
|
|
|
|
|
||||
Fiscal year 2012:
|
|
|
|
|
|
||||
First quarter
|
$
|
0.15
|
|
|
$
|
18,046
|
|
|
March 28, 2012
|
Second quarter
|
$
|
0.15
|
|
|
$
|
18,068
|
|
|
May 16, 2012
|
Third quarter
|
$
|
0.15
|
|
|
$
|
18,075
|
|
|
August 24, 2012
|
Fourth quarter
|
$
|
0.15
|
|
|
$
|
15,880
|
|
|
November 14, 2012
|
|
|
Issuer Purchases of Equity Securities
|
||||||||||||
Period
|
|
Total Number of Shares Purchased
|
|
Average Price Paid Per Share
|
|
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
(a)
|
|
Approximate Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs
(a)
|
||||||
09/29/2013 - 10/26/2013
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
32,813,356
|
|
10/27/2013 - 11/30/2013
|
|
31,200
|
|
|
46.84
|
|
|
31,200
|
|
|
31,351,948
|
|
||
12/01/2013 - 12/28/2013
|
|
199,500
|
|
|
46.66
|
|
|
199,500
|
|
|
22,043,278
|
|
||
Total
|
|
230,700
|
|
|
$
|
46.69
|
|
|
230,700
|
|
|
|
|
7/27/2011
|
|
12/31/2011
|
|
12/29/2012
|
|
12/28/2013
|
||||||||
Dunkin’ Brands Group, Inc. (DNKN)
|
$
|
100.00
|
|
|
$
|
99.92
|
|
|
$
|
132.02
|
|
|
$
|
198.43
|
|
S&P 500
|
$
|
100.00
|
|
|
$
|
94.42
|
|
|
$
|
105.29
|
|
|
$
|
138.25
|
|
S&P Consumer Discretionary
|
$
|
100.00
|
|
|
$
|
95.65
|
|
|
$
|
114.27
|
|
|
$
|
163.04
|
|
Item 6.
|
Selected Financial Data.
|
|
Fiscal Year
|
||||||||||||||
|
2013
|
|
2012
|
|
2011
|
|
2010
|
|
2009
|
||||||
|
($ in thousands, except per share data or as otherwise noted)
|
||||||||||||||
Consolidated Statements of Operations Data:
|
|
|
|
|
|
|
|
|
|
||||||
Franchise fees and royalty income
|
$
|
453,976
|
|
|
418,940
|
|
|
398,474
|
|
|
359,927
|
|
|
344,020
|
|
Rental income
|
96,082
|
|
|
96,816
|
|
|
92,145
|
|
|
91,102
|
|
|
93,651
|
|
|
Sales of ice cream products
|
112,276
|
|
|
94,659
|
|
|
100,068
|
|
|
84,989
|
|
|
75,256
|
|
|
Sales at company-owned restaurants
|
24,976
|
|
|
22,922
|
|
|
12,154
|
|
|
17,362
|
|
|
2,170
|
|
|
Other revenues
|
26,530
|
|
|
24,844
|
|
|
25,357
|
|
|
23,755
|
|
|
22,976
|
|
|
Total revenues
|
713,840
|
|
|
658,181
|
|
|
628,198
|
|
|
577,135
|
|
|
538,073
|
|
|
Amortization of intangible assets
|
26,943
|
|
|
26,943
|
|
|
28,025
|
|
|
32,467
|
|
|
35,994
|
|
|
Long-lived asset impairment charges
|
563
|
|
|
1,278
|
|
|
2,060
|
|
|
7,075
|
|
|
8,517
|
|
|
Other operating costs and expenses
(1)(2)
|
406,288
|
|
|
412,882
|
|
|
389,329
|
|
|
361,893
|
|
|
323,318
|
|
|
Total operating costs and expenses
|
433,794
|
|
|
441,103
|
|
|
419,414
|
|
|
401,435
|
|
|
367,829
|
|
|
Net income (loss) of equity method investments
(3)
|
18,370
|
|
|
22,351
|
|
|
(3,475
|
)
|
|
17,825
|
|
|
14,301
|
|
|
Operating income
|
304,736
|
|
|
239,429
|
|
|
205,309
|
|
|
193,525
|
|
|
184,545
|
|
|
Interest expense, net
|
(79,831
|
)
|
|
(73,488
|
)
|
|
(104,449
|
)
|
|
(112,532
|
)
|
|
(115,019
|
)
|
|
Gain (loss) on debt extinguishment and refinancing transactions
|
(5,018
|
)
|
|
(3,963
|
)
|
|
(34,222
|
)
|
|
(61,955
|
)
|
|
3,684
|
|
|
Other gains (losses), net
|
(1,799
|
)
|
|
23
|
|
|
175
|
|
|
408
|
|
|
1,066
|
|
|
Income before income taxes
|
218,088
|
|
|
162,001
|
|
|
66,813
|
|
|
19,446
|
|
|
74,276
|
|
|
Net income attributable to Dunkin' Brands
|
$
|
146,903
|
|
|
108,308
|
|
|
34,442
|
|
|
26,861
|
|
|
35,008
|
|
Earnings (loss) per share:
|
|
|
|
|
|
|
|
|
|
||||||
Class L—basic and diluted
|
n/a
|
|
|
n/a
|
|
|
6.14
|
|
|
4.87
|
|
|
4.57
|
|
|
Common—basic
|
$
|
1.38
|
|
|
0.94
|
|
|
(1.41
|
)
|
|
(2.04
|
)
|
|
(1.69
|
)
|
Common—diluted
|
1.36
|
|
|
0.93
|
|
|
(1.41
|
)
|
|
(2.04
|
)
|
|
(1.69
|
)
|
|
Fiscal Year
|
||||||||||||||
|
2013
|
|
2012
|
|
2011
|
|
2010
|
|
2009
|
||||||
|
($ in thousands, except per share data or as otherwise noted)
|
||||||||||||||
Consolidated Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
||||||
Total cash, cash equivalents, and restricted cash
(4)
|
$
|
257,238
|
|
|
252,985
|
|
|
246,984
|
|
|
134,504
|
|
|
171,403
|
|
Total assets
|
3,234,690
|
|
|
3,217,513
|
|
|
3,224,018
|
|
|
3,147,288
|
|
|
3,224,717
|
|
|
Total debt
(5)
|
1,831,037
|
|
|
1,857,580
|
|
|
1,473,469
|
|
|
1,864,881
|
|
|
1,451,757
|
|
|
Total liabilities
|
2,822,402
|
|
|
2,867,538
|
|
|
2,478,082
|
|
|
2,841,047
|
|
|
2,454,109
|
|
|
Common stock, Class L
(6)
|
—
|
|
|
—
|
|
|
—
|
|
|
840,582
|
|
|
1,232,001
|
|
|
Total stockholders’ equity (deficit)
(6)
|
407,358
|
|
|
349,975
|
|
|
745,936
|
|
|
(534,341
|
)
|
|
(461,393
|
)
|
|
Other Financial Data:
|
|
|
|
|
|
|
|
|
|
||||||
Capital expenditures
|
$
|
31,099
|
|
|
22,398
|
|
|
18,596
|
|
|
15,358
|
|
|
18,012
|
|
Adjusted operating income
(7)
|
340,396
|
|
|
307,157
|
|
|
270,740
|
|
|
233,067
|
|
|
229,056
|
|
|
Adjusted net income
(7)
|
165,761
|
|
|
149,700
|
|
|
101,744
|
|
|
87,759
|
|
|
59,504
|
|
|
Points of Distribution
(8)
:
|
|
|
|
|
|
|
|
|
|
||||||
Dunkin’ Donuts U.S.
|
7,677
|
|
|
7,306
|
|
|
7,015
|
|
|
6,772
|
|
|
6,566
|
|
|
Dunkin’ Donuts International
(9)
|
3,181
|
|
|
3,043
|
|
|
2,871
|
|
|
2,931
|
|
|
2,600
|
|
|
Baskin-Robbins U.S.
|
2,467
|
|
|
2,463
|
|
|
2,493
|
|
|
2,585
|
|
|
2,637
|
|
|
Baskin-Robbins International
(9)
|
4,833
|
|
|
4,556
|
|
|
4,217
|
|
|
3,848
|
|
|
3,570
|
|
|
Total distribution points
|
18,158
|
|
|
17,368
|
|
|
16,596
|
|
|
16,136
|
|
|
15,373
|
|
|
Comparable Store Sales Growth (Decline)
(10)
:
|
|
|
|
|
|
|
|
|
|
||||||
Dunkin’ Donuts U.S.
|
3.4
|
%
|
|
4.2
|
%
|
|
5.1
|
%
|
|
2.3
|
%
|
|
(1.3
|
)%
|
|
Dunkin’ Donuts International
(11)
|
(0.4
|
)%
|
|
2.0
|
%
|
|
n/a
|
|
|
n/a
|
|
|
n/a
|
|
|
Baskin-Robbins U.S.
|
0.8
|
%
|
|
3.8
|
%
|
|
0.5
|
%
|
|
(5.2
|
)%
|
|
(6.0
|
)%
|
|
Baskin-Robbins International
(11)
|
1.9
|
%
|
|
2.8
|
%
|
|
n/a
|
|
|
n/a
|
|
|
n/a
|
|
|
Franchisee-Reported Sales ($ in millions)
(12)
:
|
|
|
|
|
|
|
|
|
|
||||||
Dunkin’ Donuts U.S.
|
$
|
6,717.5
|
|
|
6,242.0
|
|
|
5,919.2
|
|
|
5,403.3
|
|
|
5,173.8
|
|
Dunkin’ Donuts International
|
683.6
|
|
|
663.2
|
|
|
636.7
|
|
|
583.6
|
|
|
508.1
|
|
|
Baskin-Robbins U.S.
|
513.3
|
|
|
509.3
|
|
|
501.7
|
|
|
500.6
|
|
|
530.4
|
|
|
Baskin-Robbins International
|
1,362.0
|
|
|
1,356.8
|
|
|
1,286.3
|
|
|
1,151.5
|
|
|
963.2
|
|
|
Total franchisee-reported sales
|
$
|
9,276.4
|
|
|
8,771.3
|
|
|
8,343.9
|
|
|
7,639.0
|
|
|
7,175.5
|
|
Company-Owned Store Sales ($ in millions)
(13)
:
|
|
|
|
|
|
|
|
|
|
||||||
Dunkin’ Donuts U.S.
|
$
|
24.6
|
|
|
22.2
|
|
|
11.6
|
|
|
16.9
|
|
|
1.8
|
|
Baskin-Robbins U.S.
|
0.4
|
|
|
0.7
|
|
|
0.5
|
|
|
0.4
|
|
|
0.4
|
|
|
Systemwide Sales Growth
(14)
:
|
|
|
|
|
|
|
|
|
|
||||||
Dunkin’ Donuts U.S.
|
7.6
|
%
|
|
5.6
|
%
|
|
9.4
|
%
|
|
4.7
|
%
|
|
3.4
|
%
|
|
Dunkin’ Donuts International
|
3.1
|
%
|
|
4.2
|
%
|
|
9.1
|
%
|
|
15.0
|
%
|
|
(4.0
|
)%
|
|
Baskin-Robbins U.S.
|
0.7
|
%
|
|
1.5
|
%
|
|
0.2
|
%
|
|
(5.6
|
)%
|
|
(6.5
|
)%
|
|
Baskin-Robbins International
|
0.4
|
%
|
|
5.5
|
%
|
|
11.7
|
%
|
|
19.5
|
%
|
|
21.5
|
%
|
|
Total systemwide sales growth
|
5.8
|
%
|
|
5.2
|
%
|
|
9.1
|
%
|
|
6.7
|
%
|
|
4.1
|
%
|
(1)
|
Includes management fees paid to our former private equity owners of $16.4 million for fiscal year 2011, and $3.0 million for each of the fiscal years 2010 and 2009 under a management agreement, which was terminated in connection with our IPO.
|
(2)
|
Fiscal year 2012 includes a $20.7 million incremental legal reserve recorded in the second quarter related to the Quebec Superior Court’s ruling in the Bertico litigation, in which the Court found for the Plaintiffs and issued a judgment against Dunkin’ Brands in the amount of approximately $C16.4 million (approximately $15.9 million), plus costs and interest.
|
(3)
|
Fiscal year 2013 includes an impairment of the investments in the Spain joint venture of $873 thousand. Fiscal year 2011 includes an impairment of the investment in the Korea joint venture of $19.8 million.
|
(4)
|
Amount as of December 26, 2009 includes cash held in restricted accounts pursuant to the terms of a securitization indebtedness of $118.2 million. Following the redemption and discharge of the securitization indebtedness in fiscal year 2010, this amount is no longer restricted. The amount also includes cash held as advertising funds or reserved for gift card/certificate programs.
|
(5)
|
Includes capital lease obligations of
$7.4 million
,
$7.6 million
, $5.2 million, $5.4 million, and $5.4 million as of
December 28, 2013
, December 29, 2012, December 31, 2011, December 25, 2010, and December 26, 2009, respectively.
|
(6)
|
Prior to our IPO in fiscal year 2011, the Company had two classes of common stock, Class L and common. Class L common stock was classified outside of permanent equity at its preferential distribution amount, as the Class L stockholders controlled the timing and amount of distributions. Immediately prior to our IPO, each share of Class L common stock converted into 2.4338 shares of common stock, and the preferential distribution amount of Class L common stock at the date of conversion was reclassified into additional paid-in capital within permanent equity.
|
(7)
|
Adjusted operating income and adjusted net income are non-GAAP measures reflecting operating income and net income adjusted for amortization of intangible assets, impairment charges, and other non-recurring, infrequent, or unusual charges, net of the tax impact of such adjustments in the case of adjusted net income. The Company uses adjusted operating income and adjusted net income as key performance measures for the purpose of evaluating performance internally. We also believe adjusted operating income and adjusted net income provide our investors with useful information regarding our historical operating results. These non-GAAP measurements are not intended to replace the presentation of our financial results in accordance with GAAP. Use of the terms adjusted operating income and adjusted net income may differ from similar measures reported by other companies. Adjusted operating income and adjusted net income are reconciled from operating income and net income, respectively, determined under GAAP as follows:
|
|
Fiscal Year
|
||||||||||||||
|
2013
|
|
2012
|
|
2011
|
|
2010
|
|
2009
|
||||||
|
(Unaudited, $ in thousands)
|
||||||||||||||
Operating income
|
$
|
304,736
|
|
|
239,429
|
|
|
205,309
|
|
|
193,525
|
|
|
184,545
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
||||||
Amortization of other intangible assets
|
26,943
|
|
|
26,943
|
|
|
28,025
|
|
|
32,467
|
|
|
35,994
|
|
|
Impairment charges
|
563
|
|
|
1,278
|
|
|
2,060
|
|
|
7,075
|
|
|
8,517
|
|
|
Third-party product volume guarantee
|
7,500
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Sponsor termination fee
|
—
|
|
|
—
|
|
|
14,671
|
|
|
—
|
|
|
—
|
|
|
Secondary offering costs
|
—
|
|
|
4,783
|
|
|
1,899
|
|
|
—
|
|
|
—
|
|
|
Peterborough plant closure
(a)
|
654
|
|
|
14,044
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Korea joint venture impairment, net
(b)
|
—
|
|
|
—
|
|
|
18,776
|
|
|
—
|
|
|
—
|
|
|
Bertico litigation
(c)
|
—
|
|
|
20,680
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Adjusted operating income
|
$
|
340,396
|
|
|
307,157
|
|
|
270,740
|
|
|
233,067
|
|
|
229,056
|
|
Net income attributable to Dunkin' Brands
|
$
|
146,903
|
|
|
108,308
|
|
|
34,442
|
|
|
26,861
|
|
|
35,008
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
||||||
Amortization of other intangible assets
|
26,943
|
|
|
26,943
|
|
|
28,025
|
|
|
32,467
|
|
|
35,994
|
|
|
Impairment charges
|
563
|
|
|
1,278
|
|
|
2,060
|
|
|
7,075
|
|
|
8,517
|
|
|
Third-party product volume guarantee
|
7,500
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Sponsor termination fee
|
—
|
|
|
—
|
|
|
14,671
|
|
|
—
|
|
|
—
|
|
|
Secondary offering costs
|
—
|
|
|
4,783
|
|
|
1,899
|
|
|
—
|
|
|
—
|
|
|
Peterborough plant closure
(a)
|
654
|
|
|
14,044
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Korea joint venture impairment, net
(b)
|
—
|
|
|
—
|
|
|
18,776
|
|
|
—
|
|
|
—
|
|
|
Bertico litigation
(c)
|
—
|
|
|
20,680
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Loss (gain) on debt extinguishment and refinancing transactions
|
5,018
|
|
|
3,963
|
|
|
34,222
|
|
|
61,955
|
|
|
(3,684
|
)
|
|
Tax impact of adjustments, excluding Bertico litigation
(d)
|
(16,271
|
)
|
|
(20,404
|
)
|
|
(32,351
|
)
|
|
(40,599
|
)
|
|
(16,331
|
)
|
|
Tax impact of Bertico adjustment
(e)
|
—
|
|
|
(3,980
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Income tax audit settlements
(f)
|
(8,417
|
)
|
|
(10,514
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
State tax apportionment
(g)
|
2,868
|
|
|
4,599
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Adjusted net income
|
$
|
165,761
|
|
|
149,700
|
|
|
101,744
|
|
|
87,759
|
|
|
59,504
|
|
(a)
|
For fiscal year 2013, the adjustment represents transition-related general and administrative costs incurred related to the closure of the Baskin-Robbins ice cream manufacturing plant in Peterborough, Canada, such as information technology integration, project management, and transportation costs. For fiscal year 2012, the adjustment included $3.4 million of severance and other payroll-related costs, $4.2 million of accelerated depreciation, $2.7 million of incremental costs of ice cream products, and $1.6 million of other transition-related costs. The amount for fiscal year 2012 also reflects the one-time delay in revenue recognition, net of related cost of ice cream products, related to the shift in manufacturing to Dean Foods of $2.1 million.
|
(b)
|
Amount consists of an impairment of the investment in the Korea joint venture of $19.8 million, less a reduction in depreciation and amortization, net of tax, of $1.0 million resulting from the allocation of the impairment charge to the underlying intangible and long-lived assets of the joint venture.
|
(c)
|
Represents the incremental legal reserve recorded in the second quarter of 2012 related to the Quebec Superior Court's ruling in the Bertico litigation, in which the Court found for the Plaintiffs and issued a judgment against Dunkin' Brands in the amount of approximately $C16.4 million (approximately $15.9 million), plus costs and interest.
|
(d)
|
Tax impact of adjustments calculated at a 40% effective tax rate for each period presented, excluding the Korea joint venture impairment in fiscal year 2011 as there was no tax impact related to that charge and the Bertico litigation adjustment for which the tax impact is calculated separately.
|
(e)
|
Tax impact of Bertico litigation adjustment calculated as if the incremental reserve had not been recorded, considering statutory tax rates and deductibility.
|
(f)
|
Represents income tax benefits resulting from the settlement of historical tax positions settled during the period, primarily related to the accounting for the acquisition of the Company by private equity firms in 2006.
|
(g)
|
Represents deferred tax expense recognized due to an increase in our overall state tax rate for a shift in the apportionment of income to state jurisdictions, as a result of the closure of the Peterborough manufacturing plant and transition to Dean Foods.
|
(8)
|
Represents period end points of distribution.
|
(9)
|
During fiscal year 2013, the Company performed an internal review of international franchised points of distribution, and determined that certain franchises opened and closed had not been accurately reported in prior years. As such, the points of distribution information above has been adjusted to reflect the results of this internal review for fiscal years 2012, 2011, 2010, and 2009 for Dunkin’ Donuts International, and fiscal years 2012 and 2011 for Baskin-Robbins International. The adjustments to the prior years were not material, and had no impact on the Company's financial position or results of operations.
|
(10)
|
Represents the growth in average weekly sales for franchisee- and company-owned restaurants that have been open at least 54 weeks that have reported sales in the current and comparable prior year week.
|
(11)
|
Comparable store sales growth data was not available for our international segments until fiscal year 2012.
|
(12)
|
Franchisee-reported sales include sales at franchisee restaurants, including joint ventures.
|
(13)
|
Company-owned store sales include sales at restaurants majority owned and operated by Dunkin’ Brands.
|
(14)
|
Systemwide sales growth represents the percentage change in sales at both franchisee- and company-owned restaurants from the comparable period of the prior year. Changes in systemwide sales are driven by changes in average comparable store sales and changes in the number of restaurants.
|
Item 7.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations.
|
|
Fiscal year
|
||||||||
|
2013
|
|
2012
|
|
2011
|
||||
Systemwide sales growth
|
5.8
|
%
|
|
5.2
|
%
|
|
9.1
|
%
|
|
Comparable store sales growth (decline):
|
|
|
|
|
|
||||
Dunkin’ Donuts U.S.
|
3.4
|
%
|
|
4.2
|
%
|
|
5.1
|
%
|
|
Dunkin' Donuts International
(1)
|
(0.4
|
)%
|
|
2.0
|
%
|
|
n/a
|
|
|
Baskin-Robbins U.S.
|
0.8
|
%
|
|
3.8
|
%
|
|
0.5
|
%
|
|
Baskin-Robbins International
(1)
|
1.9
|
%
|
|
2.8
|
%
|
|
n/a
|
|
|
Total revenues
|
$
|
713,840
|
|
|
658,181
|
|
|
628,198
|
|
Operating income
|
304,736
|
|
|
239,429
|
|
|
205,309
|
|
|
Adjusted operating income
|
340,396
|
|
|
307,157
|
|
|
270,740
|
|
|
Net income attributable to Dunkin’ Brands
|
146,903
|
|
|
108,308
|
|
|
34,442
|
|
|
Adjusted net income
|
165,761
|
|
|
149,700
|
|
|
101,744
|
|
(1)
|
Comparable store sales growth data was not available for our international segments until fiscal year 2012.
|
•
|
Dunkin’ Donuts U.S. systemwide sales growth of
7.6%
, which was the result of comparable store sales growth of
3.4%
driven by both increased average ticket and transaction counts, as well as net development of 371 restaurants in
2013
. The increase in average ticket resulted primarily from guests purchasing more units per transaction, including add-on items, and positive mix as guests purchased more premium-priced cold beverages and differentiated sandwiches. Increased traffic was driven by our focus on operational excellence and product and marketing innovation, resulting in strong growth in beverages, breakfast sandwiches, donuts, and our afternoon platform.
|
•
|
Dunkin’ Donuts International systemwide sales growth of
3.1%
as a result of sales increases in the Middle East, Southeast Asia, and Germany driven by net new restaurant development, offset by a decline in systemwide sales in South Korea and a decline in comparable store sales of
0.4%
.
|
•
|
Baskin-Robbins U.S. systemwide sales growth of
0.7%
resulting primarily from comparable store sales growth of
0.8%
. Baskin-Robbins U.S. comparable store sales growth was driven by new product news and signature Flavors of the Month, custom cake sales, and take-home ice cream quarts.
|
•
|
Baskin-Robbins International systemwide sales growth of
0.4%
resulting from increased sales in South Korea and the Middle East, which resulted from both comparable store sales growth and net development. Offsetting this growth was a decrease in systemwide sales in Japan driven by unfavorable foreign currency impact.
|
|
December 28, 2013
|
|
December 29, 2012
|
||
Points of distribution, at period end:
|
|
|
|
||
Dunkin’ Donuts U.S.
|
7,677
|
|
|
7,306
|
|
Dunkin’ Donuts International
|
3,181
|
|
|
3,043
|
|
Baskin-Robbins U.S.
|
2,467
|
|
|
2,463
|
|
Baskin-Robbins International
|
4,833
|
|
|
4,556
|
|
Consolidated global points of distribution
|
18,158
|
|
|
17,368
|
|
|
|
|
|
||
|
Fiscal year ended
|
||||
|
December 28, 2013
|
|
December 29, 2012
|
||
Net openings (closings), during the period:
|
|
|
|
||
Dunkin’ Donuts U.S.
|
371
|
|
|
291
|
|
Dunkin’ Donuts International
|
138
|
|
|
172
|
|
Baskin-Robbins U.S.
|
4
|
|
|
(30
|
)
|
Baskin-Robbins International
|
277
|
|
|
339
|
|
Consolidated global net openings
|
790
|
|
|
772
|
|
•
|
Dunkin’ Donuts U.S. systemwide sales growth of 5.6%, which was the result of comparable store sales growth of 4.2% driven by both increased average ticket and transaction counts, as well as net development of 291 restaurants in 2012, offset by approximately 190 basis points of a decline attributable to the extra week in fiscal year 2011. Increases in average ticket and transactions resulted from our continued focus on product and marketing innovation resulting in strong beverage sales growth, especially in cold beverages, strong breakfast sandwich sales across both core and limited-time offerings, continued growth in bakery sandwiches, and sales of Dunkin' Donuts K-Cup® portion packs including successful limited-time offerings.
|
•
|
Dunkin’ Donuts International systemwide sales growth of 4.2% as a result of sales increases in the Middle East and Southeast Asia driven by net new restaurant development and comparable store sales growth of 2.0%, offset by an unfavorable foreign currency impact.
|
•
|
Baskin-Robbins U.S. systemwide sales growth of 1.5% resulting primarily from comparable store sales growth of 3.8%, offset by approximately 140 basis points of a decline attributable to the extra week in fiscal year 2011, as well as 30 net restaurant closures during 2012. Baskin-Robbins U.S. comparable store sales growth was driven by new product news and signature Flavors of the Month, custom cake sales, and new beverages.
|
•
|
Baskin-Robbins International systemwide sales growth of 5.5% resulting from increased sales in South Korea and Japan, which resulted from both comparable store sales growth and net development. Offsetting this growth was approximately 170 basis points of a decline attributable to the extra week in fiscal year 2011, as well as an unfavorable foreign currency impact.
|
|
December 29, 2012
|
|
December 31, 2011
|
||
Points of distribution, at period end:
|
|
|
|
||
Dunkin’ Donuts U.S.
|
7,306
|
|
|
7,015
|
|
Dunkin’ Donuts International
|
3,043
|
|
|
2,871
|
|
Baskin-Robbins U.S.
|
2,463
|
|
|
2,493
|
|
Baskin-Robbins International
|
4,556
|
|
|
4,217
|
|
Consolidated global points of distribution
|
17,368
|
|
|
16,596
|
|
|
|
|
|
||
|
Fiscal year ended
|
||||
|
December 29, 2012
|
|
December 31, 2011
|
||
Net openings (closings), during the period:
|
|
|
|
||
Dunkin’ Donuts U.S.
|
291
|
|
|
243
|
|
Dunkin’ Donuts International
|
172
|
|
|
80
|
|
Baskin-Robbins U.S.
|
(30
|
)
|
|
(90
|
)
|
Baskin-Robbins International
|
339
|
|
|
368
|
|
Consolidated global net openings
|
772
|
|
|
601
|
|
|
Fiscal year
|
|||||||||
|
2013
|
|
2012
|
|
2011
|
|||||
Earnings (loss) per share:
|
|
|
|
|
|
|||||
Class L – basic and diluted
|
n/a
|
|
|
n/a
|
|
|
$
|
6.14
|
|
|
Common – basic
|
$
|
1.38
|
|
|
0.94
|
|
|
(1.41
|
)
|
|
Common – diluted
|
1.36
|
|
|
0.93
|
|
|
(1.41
|
)
|
||
Diluted adjusted earnings per pro forma common share
|
1.53
|
|
|
1.28
|
|
|
0.94
|
|
|
Fiscal year
|
||||||||
|
2013
|
|
2012
|
|
2011
|
||||
Adjusted net income available to common shareholders (in thousands):
|
|
|
|
|
|
||||
Adjusted net income
|
$
|
165,761
|
|
|
149,700
|
|
|
101,744
|
|
Less: Adjusted net income allocated to participating securities
|
—
|
|
|
(179
|
)
|
|
(494
|
)
|
|
Adjusted net income available to common shareholders
|
$
|
165,761
|
|
|
149,521
|
|
|
101,250
|
|
Pro forma weighted average number of common shares – diluted:
|
|
|
|
|
|
||||
Weighted average number of Class L shares over period in which Class L shares were outstanding
(1)
|
—
|
|
|
—
|
|
|
22,845,378
|
|
|
Adjustment to weight Class L shares over respective fiscal year
(1)
|
—
|
|
|
—
|
|
|
(9,790,933
|
)
|
|
Weighted average number of Class L shares over fiscal year
|
—
|
|
|
—
|
|
|
13,054,445
|
|
|
Class L conversion factor
|
—
|
|
|
—
|
|
|
2.4338
|
|
|
Weighted average number of converted Class L shares
|
—
|
|
|
—
|
|
|
31,772,244
|
|
|
Weighted average number of common shares
|
106,501,733
|
|
|
114,584,063
|
|
|
74,835,697
|
|
|
Pro forma weighted average number of common shares – basic
|
106,501,733
|
|
|
114,584,063
|
|
|
106,607,941
|
|
|
Incremental dilutive common shares
(2)
|
1,715,278
|
|
|
1,989,281
|
|
|
1,064,587
|
|
|
Pro forma weighted average number of common shares – diluted
|
108,217,011
|
|
|
116,573,344
|
|
|
107,672,528
|
|
|
Diluted adjusted earnings per pro forma common share
|
$
|
1.53
|
|
|
1.28
|
|
|
0.94
|
|
(1)
|
The weighted average number of Class L shares in the actual Class L earnings per share calculation for fiscal year 2011 represents the weighted average from the beginning of the fiscal year up through the date of conversion of the Class L shares into common shares. As such, the pro forma weighted average number of common shares includes an adjustment to the weighted average number of Class L shares outstanding to reflect the length of time the Class L shares were outstanding prior to conversion relative to the fiscal year. The converted Class L shares are already included in the weighted average number of common shares outstanding for the period after their conversion.
|
(2)
|
Represents the dilutive effect of restricted shares and stock options, using the treasury stock method.
|
|
Fiscal year
|
|
Increase (Decrease)
|
|||||||||
2013
|
|
2012
|
$
|
|
%
|
|||||||
|
(In thousands, except percentages)
|
|||||||||||
Franchise fees and royalty income
|
$
|
453,976
|
|
|
418,940
|
|
|
35,036
|
|
|
8.4
|
%
|
Rental income
|
96,082
|
|
|
96,816
|
|
|
(734
|
)
|
|
(0.8
|
)%
|
|
Sales of ice cream products
|
112,276
|
|
|
94,659
|
|
|
17,617
|
|
|
18.6
|
%
|
|
Sales at company-owned restaurants
|
24,976
|
|
|
22,922
|
|
|
2,054
|
|
|
9.0
|
%
|
|
Other revenues
|
26,530
|
|
|
24,844
|
|
|
1,686
|
|
|
6.8
|
%
|
|
Total revenues
|
$
|
713,840
|
|
|
658,181
|
|
|
55,659
|
|
|
8.5
|
%
|
|
Fiscal year
|
|
Increase (Decrease)
|
|||||||||
2013
|
|
2012
|
$
|
|
%
|
|||||||
|
(In thousands, except percentages)
|
|||||||||||
Occupancy expenses – franchised restaurants
|
$
|
52,097
|
|
|
52,072
|
|
|
25
|
|
|
—
|
%
|
Cost of ice cream products
|
79,278
|
|
|
69,019
|
|
|
10,259
|
|
|
14.9
|
%
|
|
Company-owned restaurant expenses
|
24,480
|
|
|
23,133
|
|
|
1,347
|
|
|
5.8
|
%
|
|
General and administrative expenses, net
|
228,010
|
|
|
239,574
|
|
|
(11,564
|
)
|
|
(4.8
|
)%
|
|
Depreciation and amortization
|
49,366
|
|
|
56,027
|
|
|
(6,661
|
)
|
|
(11.9
|
)%
|
|
Long-lived asset impairment charges
|
563
|
|
|
1,278
|
|
|
(715
|
)
|
|
(55.9
|
)%
|
|
Total operating costs and expenses
|
$
|
433,794
|
|
|
441,103
|
|
|
(7,309
|
)
|
|
(1.7
|
)%
|
Net income of equity method investments
|
18,370
|
|
|
22,351
|
|
|
(3,981
|
)
|
|
(17.8
|
)%
|
|
Other operating income, net
|
6,320
|
|
|
—
|
|
|
6,320
|
|
|
n/m
|
|
|
Operating income
|
$
|
304,736
|
|
|
239,429
|
|
|
65,307
|
|
|
27.3
|
%
|
|
Fiscal year
|
|||||
|
2013
|
|
2012
|
|||
|
(In thousands, except percentages)
|
|||||
Income before income taxes
|
$
|
218,088
|
|
|
162,001
|
|
Provision for income taxes
|
71,784
|
|
|
54,377
|
|
|
Effective tax rate
|
32.9
|
%
|
|
33.6
|
%
|
|
Fiscal year
|
|
Increase (Decrease)
|
|||||||||
2013
|
|
2012
|
$
|
|
%
|
|||||||
|
(In thousands, except percentages)
|
|||||||||||
Royalty income
|
$
|
362,342
|
|
|
337,170
|
|
|
25,172
|
|
|
7.5
|
%
|
Franchise fees
|
36,192
|
|
|
29,445
|
|
|
6,747
|
|
|
22.9
|
%
|
|
Rental income
|
91,918
|
|
|
92,049
|
|
|
(131
|
)
|
|
(0.1
|
)%
|
|
Sales at company-owned restaurants
|
24,976
|
|
|
22,765
|
|
|
2,211
|
|
|
9.7
|
%
|
|
Other revenues
|
5,751
|
|
|
3,970
|
|
|
1,781
|
|
|
44.9
|
%
|
|
Total revenues
|
$
|
521,179
|
|
|
485,399
|
|
|
35,780
|
|
|
7.4
|
%
|
Segment profit
|
$
|
379,751
|
|
|
355,274
|
|
|
24,477
|
|
|
6.9
|
%
|
|
Fiscal year
|
|
Increase (Decrease)
|
|||||||||
2013
|
|
2012
|
$
|
|
%
|
|||||||
|
(In thousands, except percentages)
|
|||||||||||
Royalty income
|
$
|
14,249
|
|
|
13,474
|
|
|
775
|
|
|
5.8
|
%
|
Franchise fees
|
3,531
|
|
|
1,715
|
|
|
1,816
|
|
|
105.9
|
%
|
|
Rental income
|
133
|
|
|
179
|
|
|
(46
|
)
|
|
(25.7
|
)%
|
|
Other revenues
|
403
|
|
|
117
|
|
|
286
|
|
|
244.4
|
%
|
|
Total revenues
|
$
|
18,316
|
|
|
15,485
|
|
|
2,831
|
|
|
18.3
|
%
|
Segment profit
|
$
|
7,479
|
|
|
9,670
|
|
|
(2,191
|
)
|
|
(22.7
|
)%
|
|
Fiscal year
|
|
Increase (Decrease)
|
|||||||||
2013
|
|
2012
|
$
|
|
%
|
|||||||
|
(In thousands, except percentages)
|
|||||||||||
Royalty income
|
$
|
25,728
|
|
|
25,768
|
|
|
(40
|
)
|
|
(0.2
|
)%
|
Franchise fees
|
1,160
|
|
|
775
|
|
|
385
|
|
|
49.7
|
%
|
|
Rental income
|
3,420
|
|
|
3,949
|
|
|
(529
|
)
|
|
(13.4
|
)%
|
|
Sales of ice cream products
|
3,808
|
|
|
3,942
|
|
|
(134
|
)
|
|
(3.4
|
)%
|
|
Sales at company-owned restaurants
|
—
|
|
|
157
|
|
|
(157
|
)
|
|
(100.0
|
)%
|
|
Other revenues
|
8,036
|
|
|
7,483
|
|
|
553
|
|
|
7.4
|
%
|
|
Total revenues
|
$
|
42,152
|
|
|
42,074
|
|
|
78
|
|
|
0.2
|
%
|
Segment profit
|
$
|
27,081
|
|
|
26,274
|
|
|
807
|
|
|
3.1
|
%
|
|
Fiscal year
|
|
Increase (Decrease)
|
|||||||||
2013
|
|
2012
|
$
|
|
%
|
|||||||
|
(In thousands, except percentages)
|
|||||||||||
Royalty income
|
$
|
9,109
|
|
|
9,301
|
|
|
(192
|
)
|
|
(2.1
|
)%
|
Franchise fees
|
1,665
|
|
|
1,292
|
|
|
373
|
|
|
28.9
|
%
|
|
Rental income
|
535
|
|
|
561
|
|
|
(26
|
)
|
|
(4.6
|
)%
|
|
Sales of ice cream products
|
108,435
|
|
|
90,717
|
|
|
17,718
|
|
|
19.5
|
%
|
|
Other revenues
|
589
|
|
|
104
|
|
|
485
|
|
|
466.3
|
%
|
|
Total revenues
|
$
|
120,333
|
|
|
101,975
|
|
|
18,358
|
|
|
18.0
|
%
|
Segment profit
|
$
|
54,321
|
|
|
42,004
|
|
|
12,317
|
|
|
29.3
|
%
|
|
Fiscal year
|
|
Increase (Decrease)
|
||||||||||
2012
|
|
2011
|
$
|
|
%
|
||||||||
|
(In thousands, except percentages)
|
||||||||||||
Franchise fees and royalty income
|
$
|
418,940
|
|
|
$
|
398,474
|
|
|
20,466
|
|
|
5.1
|
%
|
Rental income
|
96,816
|
|
|
92,145
|
|
|
4,671
|
|
|
5.1
|
%
|
||
Sales of ice cream products
|
94,659
|
|
|
100,068
|
|
|
(5,409
|
)
|
|
(5.4
|
)%
|
||
Sales at company-owned restaurants
|
22,922
|
|
|
12,154
|
|
|
10,768
|
|
|
88.6
|
%
|
||
Other revenues
|
24,844
|
|
|
25,357
|
|
|
(513
|
)
|
|
(2.0
|
)%
|
||
Total revenues
|
$
|
658,181
|
|
|
628,198
|
|
|
29,983
|
|
|
4.8
|
%
|
|
Fiscal year
|
|
Increase (Decrease)
|
|||||||||
2012
|
|
2011
|
$
|
|
%
|
|||||||
|
(In thousands, except percentages)
|
|||||||||||
Occupancy expenses – franchised restaurants
|
$
|
52,072
|
|
|
51,878
|
|
|
194
|
|
|
0.4
|
%
|
Cost of ice cream products
|
69,019
|
|
|
72,329
|
|
|
(3,310
|
)
|
|
(4.6
|
)%
|
|
Company-owned restaurant expenses
|
23,133
|
|
|
12,854
|
|
|
10,279
|
|
|
80.0
|
%
|
|
General and administrative expenses, net
|
239,574
|
|
|
227,771
|
|
|
11,803
|
|
|
5.2
|
%
|
|
Depreciation and amortization
|
56,027
|
|
|
52,522
|
|
|
3,505
|
|
|
6.7
|
%
|
|
Impairment charges
|
1,278
|
|
|
2,060
|
|
|
(782
|
)
|
|
(38.0
|
)%
|
|
Total operating costs and expenses
|
$
|
441,103
|
|
|
419,414
|
|
|
21,689
|
|
|
5.2
|
%
|
Net income (loss) of equity method investments
|
22,351
|
|
|
(3,475
|
)
|
|
25,826
|
|
|
n/m
|
|
|
Operating income
|
$
|
239,429
|
|
|
205,309
|
|
|
34,120
|
|
|
16.6
|
%
|
|
Fiscal year
|
|
Increase (Decrease)
|
|||||||||
2012
|
|
2011
|
$
|
|
%
|
|||||||
|
(In thousands, except percentages)
|
|||||||||||
Interest expense, net
|
$
|
73,488
|
|
|
104,449
|
|
|
(30,961
|
)
|
|
(29.6
|
)%
|
Loss on debt extinguishment and refinancing transactions
|
3,963
|
|
|
34,222
|
|
|
(30,259
|
)
|
|
(88.4
|
)%
|
|
Other gains, net
|
(23
|
)
|
|
(175
|
)
|
|
152
|
|
|
(86.9
|
)%
|
|
Total other expense
|
$
|
77,428
|
|
|
138,496
|
|
|
(61,068
|
)
|
|
(44.1
|
)%
|
|
Fiscal year
|
|||||
|
2012
|
|
2011
|
|||
|
(In thousands, except percentages)
|
|||||
Income before income taxes
|
$
|
162,001
|
|
|
66,813
|
|
Provision for income taxes
|
54,377
|
|
|
32,371
|
|
|
Effective tax rate
|
33.6
|
%
|
|
48.5
|
%
|
|
Fiscal year
|
|
Increase (Decrease)
|
|||||||||
2012
|
|
2011
|
$
|
|
%
|
|||||||
|
(In thousands, except percentages)
|
|||||||||||
Royalty income
|
$
|
337,170
|
|
|
317,203
|
|
|
19,967
|
|
|
6.3
|
%
|
Franchise fees
|
29,445
|
|
|
29,905
|
|
|
(460
|
)
|
|
(1.5
|
)%
|
|
Rental income
|
92,049
|
|
|
86,590
|
|
|
5,459
|
|
|
6.3
|
%
|
|
Sales at company-owned restaurants
|
22,765
|
|
|
11,764
|
|
|
11,001
|
|
|
93.5
|
%
|
|
Other revenues
|
3,970
|
|
|
4,030
|
|
|
(60
|
)
|
|
(1.5
|
)%
|
|
Total revenues
|
$
|
485,399
|
|
|
449,492
|
|
|
35,907
|
|
|
8.0
|
%
|
Segment profit
|
$
|
355,274
|
|
|
334,308
|
|
|
20,966
|
|
|
6.3
|
%
|
|
Fiscal year
|
|
Increase (Decrease)
|
|||||||||
2012
|
|
2011
|
$
|
|
%
|
|||||||
|
(In thousands, except percentages)
|
|||||||||||
Royalty income
|
$
|
13,474
|
|
|
12,657
|
|
|
817
|
|
|
6.5
|
%
|
Franchise fees
|
1,715
|
|
|
2,294
|
|
|
(579
|
)
|
|
(25.2
|
)%
|
|
Rental income
|
179
|
|
|
258
|
|
|
(79
|
)
|
|
(30.6
|
)%
|
|
Other revenues
|
117
|
|
|
44
|
|
|
73
|
|
|
165.9
|
%
|
|
Total revenues
|
$
|
15,485
|
|
|
15,253
|
|
|
232
|
|
|
1.5
|
%
|
Segment profit
|
$
|
9,670
|
|
|
11,528
|
|
|
(1,858
|
)
|
|
(16.1
|
)%
|
|
Fiscal year
|
|
Increase (Decrease)
|
|||||||||
2012
|
|
2011
|
$
|
|
%
|
|||||||
|
(In thousands, except percentages)
|
|||||||||||
Royalty income
|
$
|
25,768
|
|
|
25,177
|
|
|
591
|
|
|
2.3
|
%
|
Franchise fees
|
775
|
|
|
1,271
|
|
|
(496
|
)
|
|
(39.0
|
)%
|
|
Rental income
|
3,949
|
|
|
4,544
|
|
|
(595
|
)
|
|
(13.1
|
)%
|
|
Sales of ice cream products
|
3,942
|
|
|
3,780
|
|
|
162
|
|
|
4.3
|
%
|
|
Sales at company-owned restaurants
|
157
|
|
|
390
|
|
|
(233
|
)
|
|
(59.7
|
)%
|
|
Other revenues
|
7,483
|
|
|
8,293
|
|
|
(810
|
)
|
|
(9.8
|
)%
|
|
Total revenues
|
$
|
42,074
|
|
|
43,455
|
|
|
(1,381
|
)
|
|
(3.2
|
)%
|
Segment profit
|
$
|
26,274
|
|
|
21,593
|
|
|
4,681
|
|
|
21.7
|
%
|
|
Fiscal year
|
|
Increase (Decrease)
|
|||||||||
2011
|
|
2010
|
$
|
|
%
|
|||||||
|
(In thousands, except percentages)
|
|||||||||||
Royalty income
|
$
|
9,301
|
|
|
8,422
|
|
|
879
|
|
|
10.4
|
%
|
Franchise fees
|
1,292
|
|
|
1,593
|
|
|
(301
|
)
|
|
(18.9
|
)%
|
|
Rental income
|
561
|
|
|
616
|
|
|
(55
|
)
|
|
(8.9
|
)%
|
|
Sales of ice cream products
|
90,717
|
|
|
96,288
|
|
|
(5,571
|
)
|
|
(5.8
|
)%
|
|
Other revenues
|
104
|
|
|
(32
|
)
|
|
136
|
|
|
n/m
|
|
|
Total revenues
|
$
|
101,975
|
|
|
106,887
|
|
|
(4,912
|
)
|
|
(4.6
|
)%
|
Segment profit
|
$
|
42,004
|
|
|
42,844
|
|
|
(840
|
)
|
|
(2.0
|
)%
|
|
Fiscal year
|
||||
|
2013
|
2012
|
|||
Net cash provided by operating activities
|
$
|
141,799
|
|
154,420
|
|
Less: Increase related to advertising funds and gift card/certificate programs
|
(2,006
|
)
|
(2,315
|
)
|
|
Less: Net cash used in investing activities
|
(22,906
|
)
|
(22,947
|
)
|
|
Free cash flow
|
$
|
116,887
|
|
129,158
|
|
|
Fiscal year
2013
|
||
Net income including noncontrolling interests
|
$
|
146,304
|
|
Interest expense
|
80,235
|
|
|
Income tax expense
|
71,784
|
|
|
Depreciation and amortization
|
49,366
|
|
|
Impairment charges
|
1,436
|
|
|
EBITDA
|
349,125
|
|
|
Adjustments:
|
|
||
Non-cash adjustments
(a)
|
12,602
|
|
|
Loss on debt extinguishment and refinancing transactions
(b)
|
5,018
|
|
|
Severance charges
(c)
|
598
|
|
|
Third-party product volume guarantee
|
7,500
|
|
|
Gain on sale of joint venture
|
(6,320
|
)
|
|
Other
(d)
|
4,412
|
|
|
Total adjustments
|
23,810
|
|
|
Adjusted EBITDA
|
$
|
372,935
|
|
(a)
|
Represents non-cash adjustments, including stock compensation expense, legal reserves, and other non-cash gains and losses.
|
(b)
|
Represents transaction costs associated with the refinancing and repayment of long-term debt, including fees paid to third parties and write-off of deferred financing costs and original issue discount.
|
(c)
|
Represents severance and related benefits costs associated with reorganizations.
|
(d)
|
Represents costs and fees associated with various franchisee-related information technology and other investments, bank fees, the closure of the Company's Canadian ice cream manufacturing plant, as well as the net impact of other insignificant adjustments.
|
(In millions)
|
Total
|
|
Less than
1 year
|
|
1-3
years
|
|
3-5
years
|
|
More than
5 years
|
||||||
Long-term debt
(1)
|
$
|
2,386.8
|
|
|
68.3
|
|
|
170.6
|
|
|
626.2
|
|
|
1,521.7
|
|
Capital lease obligations
|
12.0
|
|
|
1.0
|
|
|
2.1
|
|
|
2.2
|
|
|
6.7
|
|
|
Operating lease obligations
|
639.8
|
|
|
52.9
|
|
|
102.3
|
|
|
100.3
|
|
|
384.3
|
|
|
Purchase obligations and guarantees
(2)(3)
|
8.4
|
|
|
7.8
|
|
|
0.6
|
|
|
—
|
|
|
—
|
|
|
Short and long-term obligations
(4)
|
1.6
|
|
|
1.6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Total
(5)
|
$
|
3,048.6
|
|
|
131.6
|
|
|
275.6
|
|
|
728.7
|
|
|
1,912.7
|
|
(1)
|
Amounts include mandatory principal payments on long-term debt, as well as estimated interest of $64.9 million, $137.5 million, $161.0 million, and $189.5 million for less than 1 year, 1-3 years, 3-5 years, and more than 5 years, respectively. Interest on the $1.8 billion of term loans under our senior credit facility is variable, subject to an interest rate floor for a portion of the term loans, and has been estimated based on a current LIBOR yield curve. Additionally, estimated interest also reflects the impact of our amended variable-to-fixed interest rate swap agreements. Our term loans also require us to prepay an amount equal to 25% of excess cash flow (as defined in the senior credit facility) for the preceding fiscal year based on our leverage ratio at the end of the fiscal year. If our leverage ratio is less than 4.75x, then no excess cash flow prepayment is required. No excess cash flow payment is required related to fiscal year 2013 based on our current leverage ratio, and therefore no excess cash flow payments have been reflected for any years in the contractual obligation amounts above.
|
(2)
|
We have entered into two third-party guarantees with a distribution facility of franchisee products that ensures franchisees will purchase or sell a certain volume of product. As of December 28, 2013, we were contingently liable for
$5.7 million
under one of these guarantees, and are currently obligated to pay
$7.5 million
in the first quarter of 2014 under the other guarantee. We also have various supply chain contracts that provide for purchase commitments or exclusivity, the majority of which result in our being contingently liable upon early termination of the agreement or engaging with another supplier. . As of December 28, 2013, we were contingently liable under such supply chain agreements for approximately
$52.6 million
, and considering various factors including internal forecasts, prior history, and ability to extend contract terms, we have accrued
$0.9 million
related to these supply chain commitments. Such amounts, with the exception of the $7.5 million guarantee payment due in the first quarter of 2014 and the supply chain commitments accrued, are not included in the table above as timing of payment, if any, is uncertain.
|
(3)
|
We are guarantors of and are contingently liable for certain lease arrangements primarily as the result of our assigning our interest. As of December 28, 2013, we were contingently liable for
$6.4 million
under these guarantees, which are discussed further above in “Off Balance Sheet Obligations.” Additionally, in certain cases, we issue guarantees to financial institutions so that franchisees can obtain financing. If all outstanding guarantees, which are discussed further below in “Critical accounting policies,” came due as of December 28, 2013, we would be liable for approximately
$3.0 million
. Such amounts are not included in the table above as timing of payment, if any, is uncertain.
|
(4)
|
Amounts include obligations to former employees under severance agreements. Excluded from these amounts are any payments that may be required related to pending litigation, such as the Bertico matter more fully described in note 17(d) to our consolidated financial statements included herein, as the amount and timing of cash requirements, if any, are uncertain.
|
(5)
|
Income tax liabilities for uncertain tax positions, gift card/certificate liabilities, and liabilities to various advertising funds are excluded from the table above as we are not able to make a reasonably reliable estimate of the amount and period of related future payments. As of December 28, 2013, we had a liability for uncertain tax positions, including accrued interest and penalties thereon, of $12.4 million. As of December 28, 2013, we had a gift card/certificate liability of
$139.7 million
and a gift card breakage liability of
$14.1 million
(see note 2(v) to our consolidated financial statements included herein). As of December 28, 2013, we had a net payable of
$17.6 million
to the various advertising funds.
|
Item 7A.
|
Quantitative and Qualitative Disclosures about Market Risk
|
Item 8.
|
Financial Statements and Supplementary Data
|
|
December 28,
2013 |
|
December 29,
2012 |
|||
Assets
|
|
|
|
|||
Current assets:
|
|
|
|
|||
Cash and cash equivalents
|
$
|
256,933
|
|
|
252,618
|
|
Accounts receivable, net
|
47,162
|
|
|
32,407
|
|
|
Notes and other receivables, net
|
32,603
|
|
|
20,649
|
|
|
Assets held for sale
|
1,663
|
|
|
2,400
|
|
|
Deferred income taxes, net
|
46,461
|
|
|
47,263
|
|
|
Restricted assets of advertising funds
|
31,493
|
|
|
31,849
|
|
|
Prepaid income taxes
|
25,699
|
|
|
10,825
|
|
|
Prepaid expenses and other current assets
|
19,746
|
|
|
21,769
|
|
|
Total current assets
|
461,760
|
|
|
419,780
|
|
|
Property and equipment, net
|
182,858
|
|
|
181,172
|
|
|
Equity method investments
|
170,644
|
|
|
174,823
|
|
|
Goodwill
|
891,598
|
|
|
891,900
|
|
|
Other intangible assets, net
|
1,452,205
|
|
|
1,479,784
|
|
|
Restricted cash
|
305
|
|
|
367
|
|
|
Other assets
|
75,320
|
|
|
69,687
|
|
|
Total assets
|
$
|
3,234,690
|
|
|
3,217,513
|
|
Liabilities, Redeemable Noncontrolling Interests, and Stockholders’ Equity
|
|
|
|
|||
Current liabilities:
|
|
|
|
|||
Current portion of long-term debt
|
$
|
5,000
|
|
|
26,680
|
|
Capital lease obligations
|
432
|
|
|
371
|
|
|
Accounts payable
|
12,445
|
|
|
16,256
|
|
|
Liabilities of advertising funds
|
49,077
|
|
|
45,594
|
|
|
Deferred income
|
28,426
|
|
|
24,683
|
|
|
Other current liabilities
|
248,918
|
|
|
239,931
|
|
|
Total current liabilities
|
344,298
|
|
|
353,515
|
|
|
Long-term debt, net
|
1,818,609
|
|
|
1,823,278
|
|
|
Capital lease obligations
|
6,996
|
|
|
7,251
|
|
|
Unfavorable operating leases acquired
|
16,834
|
|
|
19,061
|
|
|
Deferred income
|
11,135
|
|
|
15,720
|
|
|
Deferred income taxes, net
|
561,714
|
|
|
569,126
|
|
|
Other long-term liabilities
|
62,816
|
|
|
79,587
|
|
|
Total long-term liabilities
|
2,478,104
|
|
|
2,514,023
|
|
|
Commitments and contingencies (note 17)
|
|
|
|
|||
Redeemable noncontrolling interests
|
4,930
|
|
|
—
|
|
|
Stockholders’ equity:
|
|
|
|
|||
Preferred stock, $0.001 par value; 25,000,000 shares authorized; no shares issued and outstanding at December 28, 2013 and December 29, 2012, respectively
|
—
|
|
|
—
|
|
|
Common stock, $0.001 par value; 475,000,000 shares authorized; 106,876,919 shares issued and 106,646,219 shares outstanding at December 28, 2013; 106,146,984 shares issued and outstanding at December 29, 2012
|
107
|
|
|
106
|
|
|
Additional paid-in capital
|
1,196,426
|
|
|
1,251,498
|
|
|
Treasury stock, at cost
|
(10,773
|
)
|
|
—
|
|
|
Accumulated deficit
|
(779,741
|
)
|
|
(914,094
|
)
|
|
Accumulated other comprehensive income
|
1,339
|
|
|
9,141
|
|
|
Total stockholders’ equity of Dunkin' Brands
|
407,358
|
|
|
346,651
|
|
|
Noncontrolling interests
|
—
|
|
|
3,324
|
|
|
Total stockholders' equity
|
407,358
|
|
|
349,975
|
|
|
Total liabilities, redeemable noncontrolling interests, and stockholders' equity
|
$
|
3,234,690
|
|
|
3,217,513
|
|
|
Fiscal year ended
|
|||||||||
|
December 28,
2013 |
|
December 29,
2012 |
|
December 31,
2011 |
|||||
Revenues:
|
|
|
|
|
|
|||||
Franchise fees and royalty income
|
$
|
453,976
|
|
|
418,940
|
|
|
398,474
|
|
|
Rental income
|
96,082
|
|
|
96,816
|
|
|
92,145
|
|
||
Sales of ice cream products
|
112,276
|
|
|
94,659
|
|
|
100,068
|
|
||
Sales at company-owned restaurants
|
24,976
|
|
|
22,922
|
|
|
12,154
|
|
||
Other revenues
|
26,530
|
|
|
24,844
|
|
|
25,357
|
|
||
Total revenues
|
713,840
|
|
|
658,181
|
|
|
628,198
|
|
||
Operating costs and expenses:
|
|
|
|
|
|
|||||
Occupancy expenses—franchised restaurants
|
52,097
|
|
|
52,072
|
|
|
51,878
|
|
||
Cost of ice cream products
|
79,278
|
|
|
69,019
|
|
|
72,329
|
|
||
Company-owned restaurant expenses
|
24,480
|
|
|
23,133
|
|
|
12,854
|
|
||
General and administrative expenses, net
|
228,010
|
|
|
239,574
|
|
|
227,771
|
|
||
Depreciation
|
22,423
|
|
|
29,084
|
|
|
24,497
|
|
||
Amortization of other intangible assets
|
26,943
|
|
|
26,943
|
|
|
28,025
|
|
||
Long-lived asset impairment charges
|
563
|
|
|
1,278
|
|
|
2,060
|
|
||
Total operating costs and expenses
|
433,794
|
|
|
441,103
|
|
|
419,414
|
|
||
Net income (loss) of equity method investments:
|
|
|
|
|
|
|||||
Net income, excluding impairment
|
19,243
|
|
|
22,351
|
|
|
16,277
|
|
||
Impairment charge, net of tax
|
(873
|
)
|
|
—
|
|
|
(19,752
|
)
|
||
Total net income (loss) of equity method investments
|
18,370
|
|
|
22,351
|
|
|
(3,475
|
)
|
||
Other operating income, net
|
6,320
|
|
|
—
|
|
|
—
|
|
||
Operating income
|
304,736
|
|
|
239,429
|
|
|
205,309
|
|
||
Other income (expense):
|
|
|
|
|
|
|||||
Interest income
|
404
|
|
|
543
|
|
|
623
|
|
||
Interest expense
|
(80,235
|
)
|
|
(74,031
|
)
|
|
(105,072
|
)
|
||
Loss on debt extinguishment and refinancing transactions
|
(5,018
|
)
|
|
(3,963
|
)
|
|
(34,222
|
)
|
||
Other gains (losses), net
|
(1,799
|
)
|
|
23
|
|
|
175
|
|
||
Total other expense
|
(86,648
|
)
|
|
(77,428
|
)
|
|
(138,496
|
)
|
||
Income before income taxes
|
218,088
|
|
|
162,001
|
|
|
66,813
|
|
||
Provision for income taxes
|
71,784
|
|
|
54,377
|
|
|
32,371
|
|
||
Net income including noncontrolling interests
|
146,304
|
|
|
107,624
|
|
|
34,442
|
|
||
Net loss attributable to noncontrolling interests
|
(599
|
)
|
|
(684
|
)
|
|
—
|
|
||
Net income attributable to Dunkin' Brands
|
$
|
146,903
|
|
|
108,308
|
|
|
34,442
|
|
|
Earnings (loss) per share:
|
|
|
|
|
|
|||||
Class L—basic and diluted
|
n/a
|
|
|
n/a
|
|
|
$
|
6.14
|
|
|
Common—basic
|
$
|
1.38
|
|
|
0.94
|
|
|
(1.41
|
)
|
|
Common—diluted
|
1.36
|
|
|
0.93
|
|
|
(1.41
|
)
|
||
Cash dividends declared per common share
|
0.76
|
|
|
0.60
|
|
|
—
|
|
|
Fiscal year ended
|
||||||||
|
December 28,
2013 |
|
December 29,
2012 |
|
December 31,
2011 |
||||
Net income including noncontrolling interests
|
$
|
146,304
|
|
|
107,624
|
|
|
34,442
|
|
Other comprehensive income (loss), net:
|
|
|
|
|
|
||||
Effect of foreign currency translation, net of deferred tax expense (benefit) of $205, $(260), and $295 for the fiscal years ended December 28, 2013, December 29, 2012, and December 31, 2011, respectively
|
(14,909
|
)
|
|
(5,996
|
)
|
|
6,560
|
|
|
Unrealized gains (losses) on interest rate swaps, net of deferred tax expense (benefit) of $5,290 and $(1,154) for the fiscal years ended December 28, 2013 and December 29, 2012, respectively
|
7,740
|
|
|
(1,655
|
)
|
|
—
|
|
|
Unrealized loss on pension plan, net of deferred tax benefit of $200, $415, and $85 for the fiscal years ended December 28, 2013, December 29, 2012, and December 31, 2011, respectively
|
(612
|
)
|
|
(1,180
|
)
|
|
(233
|
)
|
|
Other
|
(21
|
)
|
|
(1,629
|
)
|
|
(353
|
)
|
|
Total other comprehensive income (loss)
|
(7,802
|
)
|
|
(10,460
|
)
|
|
5,974
|
|
|
Comprehensive income including noncontrolling interests
|
138,502
|
|
|
97,164
|
|
|
40,416
|
|
|
Comprehensive loss attributable to noncontrolling interests
|
(599
|
)
|
|
(684
|
)
|
|
—
|
|
|
Comprehensive income attributable to Dunkin' Brands
|
$
|
139,101
|
|
|
97,848
|
|
|
40,416
|
|
|
Stockholders' equity
|
|
Redeemable noncontrolling interests
|
||||||||||||||||||||||||
|
Common stock
|
|
Additional
paid-in
capital
|
|
Treasury
stock, at cost
|
|
Accumulated
deficit
|
|
Accumulated
other
comprehensive
income
|
|
Noncontrolling interests
|
|
Total
|
|
|||||||||||||
|
Shares
|
|
Amount
|
|
|||||||||||||||||||||||
Balance at December 25, 2010
|
41,853
|
|
|
$
|
42
|
|
|
195,212
|
|
|
(1,807
|
)
|
|
(741,415
|
)
|
|
13,627
|
|
|
—
|
|
|
(534,341
|
)
|
|
—
|
|
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
34,442
|
|
|
—
|
|
|
—
|
|
|
34,442
|
|
|
—
|
|
|
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,974
|
|
|
—
|
|
|
5,974
|
|
|
—
|
|
|
Accretion of Class L preferred return
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(45,102
|
)
|
|
—
|
|
|
—
|
|
|
(45,102
|
)
|
|
—
|
|
|
Conversion of Class L shares into common stock
|
55,653
|
|
|
55
|
|
|
887,786
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
887,841
|
|
|
—
|
|
|
Issuance of common stock in connection with initial public offering
|
22,250
|
|
|
22
|
|
|
389,939
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
389,961
|
|
|
—
|
|
|
Issuance of common stock
|
129
|
|
|
—
|
|
|
942
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
942
|
|
|
—
|
|
|
Exercise of stock options
|
62
|
|
|
—
|
|
|
266
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
266
|
|
|
—
|
|
|
Share-based compensation expense
|
105
|
|
|
—
|
|
|
4,632
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,632
|
|
|
—
|
|
|
Repurchases of common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(173
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(173
|
)
|
|
—
|
|
|
Retirement of treasury stock
|
(558
|
)
|
|
—
|
|
|
(1,980
|
)
|
|
1,980
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Excess tax benefits from share-based compensation
|
—
|
|
|
—
|
|
|
1,494
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,494
|
|
|
—
|
|
|
Balance at December 31, 2011
|
119,494
|
|
|
119
|
|
|
1,478,291
|
|
|
—
|
|
|
(752,075
|
)
|
|
19,601
|
|
|
—
|
|
|
745,936
|
|
|
—
|
|
|
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
108,308
|
|
|
—
|
|
|
(684
|
)
|
|
107,624
|
|
|
—
|
|
|
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10,460
|
)
|
|
—
|
|
|
(10,460
|
)
|
|
—
|
|
|
Exercise of stock options
|
1,277
|
|
|
2
|
|
|
4,416
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,418
|
|
|
—
|
|
|
Contributions from noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,008
|
|
|
4,008
|
|
|
—
|
|
|
Dividends paid on common stock
|
—
|
|
|
—
|
|
|
(70,069
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(70,069
|
)
|
|
—
|
|
|
Share-based compensation expense
|
372
|
|
|
—
|
|
|
6,920
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,920
|
|
|
—
|
|
|
Repurchases of common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(450,369
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(450,369
|
)
|
|
—
|
|
|
Retirement of treasury stock
|
(15,001
|
)
|
|
(15
|
)
|
|
(180,027
|
)
|
|
450,369
|
|
|
(270,327
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Excess tax benefits from share-based compensation
|
—
|
|
|
—
|
|
|
11,978
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11,978
|
|
|
—
|
|
|
Other
|
—
|
|
|
—
|
|
|
(11
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(11
|
)
|
|
—
|
|
|
Balance at December 29, 2012
|
106,142
|
|
|
106
|
|
|
1,251,498
|
|
|
—
|
|
|
(914,094
|
)
|
|
9,141
|
|
|
3,324
|
|
|
349,975
|
|
|
—
|
|
|
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
146,903
|
|
|
—
|
|
|
(239
|
)
|
|
146,664
|
|
|
(360
|
)
|
|
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(7,802
|
)
|
|
—
|
|
|
(7,802
|
)
|
|
—
|
|
|
Exercise of stock options
|
1,140
|
|
|
1
|
|
|
7,962
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,963
|
|
|
—
|
|
|
Reclassification to redeemable noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,085
|
)
|
|
(3,085
|
)
|
|
3,085
|
|
|
Contributions from redeemable noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,205
|
|
|
Dividends paid on common stock
|
—
|
|
|
—
|
|
|
(81,008
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(81,008
|
)
|
|
—
|
|
|
Share-based compensation expense
|
12
|
|
|
—
|
|
|
7,323
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,323
|
|
|
—
|
|
|
Repurchases of common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(27,963
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(27,963
|
)
|
|
—
|
|
|
Retirement of treasury stock
|
(417
|
)
|
|
—
|
|
|
(4,688
|
)
|
|
17,190
|
|
|
(12,502
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Excess tax benefits from share-based compensation
|
—
|
|
|
—
|
|
|
15,366
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
15,366
|
|
|
—
|
|
|
Other
|
—
|
|
|
—
|
|
|
(27
|
)
|
|
—
|
|
|
(48
|
)
|
|
—
|
|
|
—
|
|
|
(75
|
)
|
|
—
|
|
|
Balance at December 28, 2013
|
106,877
|
|
|
$
|
107
|
|
|
1,196,426
|
|
|
(10,773
|
)
|
|
(779,741
|
)
|
|
1,339
|
|
|
—
|
|
|
407,358
|
|
|
4,930
|
|
|
Fiscal year ended
|
||||||||
|
December 28,
2013 |
|
December 29,
2012 |
|
December 31,
2011 |
||||
Cash flows from operating activities:
|
|
|
|
|
|
||||
Net income including noncontrolling interests
|
$
|
146,304
|
|
|
107,624
|
|
|
34,442
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
||||
Depreciation and amortization
|
49,366
|
|
|
56,027
|
|
|
52,522
|
|
|
Amortization of deferred financing costs and original issue discount
|
4,706
|
|
|
5,727
|
|
|
6,278
|
|
|
Loss on debt extinguishment and refinancing transactions
|
5,018
|
|
|
3,963
|
|
|
34,222
|
|
|
Impact of unfavorable operating leases acquired
|
(2,177
|
)
|
|
(2,352
|
)
|
|
(3,230
|
)
|
|
Deferred income taxes
|
(13,191
|
)
|
|
(6,946
|
)
|
|
(11,363
|
)
|
|
Long-lived asset impairment charges
|
563
|
|
|
1,278
|
|
|
2,060
|
|
|
Provision for (recovery of) bad debt
|
3,484
|
|
|
(542
|
)
|
|
2,019
|
|
|
Share-based compensation expense
|
7,323
|
|
|
6,920
|
|
|
4,632
|
|
|
Net loss (income) of equity method investments
|
(18,370
|
)
|
|
(22,351
|
)
|
|
3,475
|
|
|
Dividends received from equity method investments
|
7,226
|
|
|
6,497
|
|
|
7,362
|
|
|
Gain on sale of joint venture
|
(6,320
|
)
|
|
—
|
|
|
—
|
|
|
Other, net
|
(2,268
|
)
|
|
(845
|
)
|
|
(2,633
|
)
|
|
Change in operating assets and liabilities:
|
|
|
|
|
|
||||
Accounts, notes, and other receivables, net
|
(27,444
|
)
|
|
6,321
|
|
|
19,123
|
|
|
Other current assets
|
1,879
|
|
|
(1,480
|
)
|
|
4,406
|
|
|
Accounts payable
|
46
|
|
|
2,804
|
|
|
85
|
|
|
Other current liabilities
|
8,163
|
|
|
38,767
|
|
|
17,904
|
|
|
Liabilities of advertising funds, net
|
4,795
|
|
|
(5,688
|
)
|
|
(3,572
|
)
|
|
Income taxes payable, net
|
(27,847
|
)
|
|
(38,928
|
)
|
|
473
|
|
|
Deferred income
|
(842
|
)
|
|
(1,491
|
)
|
|
(5,658
|
)
|
|
Other, net
|
1,385
|
|
|
(885
|
)
|
|
156
|
|
|
Net cash provided by operating activities
|
141,799
|
|
|
154,420
|
|
|
162,703
|
|
|
Cash flows from investing activities:
|
|
|
|
|
|
||||
Additions to property and equipment
|
(31,099
|
)
|
|
(22,398
|
)
|
|
(18,596
|
)
|
|
Proceeds from sale of joint venture
|
6,682
|
|
|
—
|
|
|
—
|
|
|
Other, net
|
1,511
|
|
|
(549
|
)
|
|
(1,211
|
)
|
|
Net cash used in investing activities
|
(22,906
|
)
|
|
(22,947
|
)
|
|
(19,807
|
)
|
|
Cash flows from financing activities:
|
|
|
|
|
|
||||
Proceeds from issuance of long-term debt
|
—
|
|
|
396,000
|
|
|
250,000
|
|
|
Repayment of long-term debt
|
(24,157
|
)
|
|
(15,441
|
)
|
|
(654,608
|
)
|
|
Payment of deferred financing and other debt-related costs
|
(6,157
|
)
|
|
(5,978
|
)
|
|
(20,087
|
)
|
|
Proceeds from initial public offering, net of offering costs
|
—
|
|
|
—
|
|
|
389,961
|
|
|
Repurchases of common stock
|
(27,963
|
)
|
|
(450,369
|
)
|
|
(286
|
)
|
|
Dividends paid on common stock
|
(81,008
|
)
|
|
(70,069
|
)
|
|
—
|
|
|
Exercise of stock options
|
7,963
|
|
|
4,418
|
|
|
266
|
|
|
Excess tax benefits from share-based compensation
|
15,366
|
|
|
11,978
|
|
|
1,494
|
|
|
Other, net
|
1,782
|
|
|
3,859
|
|
|
3,186
|
|
|
Net cash used in financing activities
|
(114,174
|
)
|
|
(125,602
|
)
|
|
(30,074
|
)
|
|
Effect of exchange rate changes on cash and cash equivalents
|
(404
|
)
|
|
32
|
|
|
(207
|
)
|
|
Increase in cash and cash equivalents
|
4,315
|
|
|
5,903
|
|
|
112,615
|
|
|
Cash and cash equivalents, beginning of year
|
252,618
|
|
|
246,715
|
|
|
134,100
|
|
|
Cash and cash equivalents, end of year
|
$
|
256,933
|
|
|
252,618
|
|
|
246,715
|
|
Supplemental cash flow information:
|
|
|
|
|
|
||||
Cash paid for income taxes
|
$
|
98,483
|
|
|
90,225
|
|
|
43,143
|
|
Cash paid for interest
|
78,127
|
|
|
54,115
|
|
|
103,147
|
|
|
Noncash investing activities:
|
|
|
|
|
|
||||
Property and equipment included in accounts payable and other current liabilities
|
1,366
|
|
|
5,244
|
|
|
1,641
|
|
|
Purchase of leaseholds in exchange for capital lease obligations
|
173
|
|
|
2,818
|
|
|
—
|
|
|
December 28, 2013
|
|
December 29, 2012
|
|||||||||||||||
|
Quoted prices
in active
markets for
identical assets
(Level 1)
|
|
Significant
other
observable
inputs
(Level 2)
|
|
Total
|
|
Quoted prices
in active
markets for
identical assets
(Level 1)
|
|
Significant
other
observable
inputs
(Level 2)
|
|
Total
|
|||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Mutual funds
|
$
|
1,012
|
|
|
—
|
|
|
1,012
|
|
|
2,505
|
|
|
—
|
|
|
2,505
|
|
Interest rate swaps
|
—
|
|
|
10,221
|
|
|
10,221
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Total assets
|
$
|
1,012
|
|
|
10,221
|
|
|
11,233
|
|
|
2,505
|
|
|
—
|
|
|
2,505
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Deferred compensation liabilities
|
$
|
—
|
|
|
7,181
|
|
|
7,181
|
|
|
—
|
|
|
7,379
|
|
|
7,379
|
|
Interest rate swaps
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,809
|
|
|
2,809
|
|
|
Total liabilities
|
$
|
—
|
|
|
7,181
|
|
|
7,181
|
|
|
—
|
|
|
10,188
|
|
|
10,188
|
|
|
December 28, 2013
|
|
December 29, 2012
|
|||||||||
Financial liabilities
|
Carrying
value
|
|
Estimated
fair value
|
|
Carrying
value
|
|
Estimated
fair value
|
|||||
Term loans
|
$
|
1,823,609
|
|
|
1,836,212
|
|
|
1,849,958
|
|
|
1,878,980
|
|
|
Years
|
Buildings
|
20 – 35
|
Leasehold improvements
|
5 – 20
|
Store, production, and other equipment
|
3 – 10
|
|
Fiscal year ended
|
||||||||
|
December 28, 2013
|
|
December 29, 2012
|
|
December 31, 2011
|
||||
Royalty income
|
$
|
411,428
|
|
|
385,713
|
|
|
363,458
|
|
Initial franchise fees and renewal income
|
42,548
|
|
|
33,227
|
|
|
35,016
|
|
|
Total franchise fees and royalty income
|
$
|
453,976
|
|
|
418,940
|
|
|
398,474
|
|
|
Fiscal year ended
|
|||||||
|
December 28, 2013
|
|
December 29, 2012
|
|
December 31, 2011
|
|||
Systemwide points of distribution:
|
|
|
|
|
|
|||
Franchised points of distribution in operation—beginning of year
|
17,333
|
|
|
16,565
|
|
|
16,105
|
|
Franchises opened
|
1,388
|
|
|
1,470
|
|
|
1,403
|
|
Franchises closed
|
(600
|
)
|
|
(701
|
)
|
|
(944
|
)
|
Net transfers from (to) company-owned points of distribution
|
1
|
|
|
(1
|
)
|
|
1
|
|
Franchised points of distribution in operation—end of year
|
18,122
|
|
|
17,333
|
|
|
16,565
|
|
Company-owned points of distribution—end of year
|
36
|
|
|
35
|
|
|
31
|
|
Total systemwide points of distribution—end of year
|
18,158
|
|
|
17,368
|
|
|
16,596
|
|
|
December 28, 2013
|
|
December 29, 2012
|
|||
Land
|
$
|
34,052
|
|
|
31,080
|
|
Buildings
|
47,946
|
|
|
45,447
|
|
|
Leasehold improvements
|
154,491
|
|
|
158,797
|
|
|
Store, production, and other equipment
|
43,124
|
|
|
50,046
|
|
|
Construction in progress
|
9,079
|
|
|
5,549
|
|
|
Property and equipment, gross
|
288,692
|
|
|
290,919
|
|
|
Accumulated depreciation and amortization
|
(105,834
|
)
|
|
(109,747
|
)
|
|
Property and equipment, net
|
$
|
182,858
|
|
|
181,172
|
|
|
December 28,
2013 |
|
December 29,
2012 |
|||
Current assets
|
$
|
261,546
|
|
|
248,371
|
|
Current liabilities
|
106,280
|
|
|
102,787
|
|
|
Working capital
|
155,266
|
|
|
145,584
|
|
|
Property, plant, and equipment, net
|
139,378
|
|
|
144,570
|
|
|
Other assets
|
173,491
|
|
|
163,511
|
|
|
Long-term liabilities
|
52,389
|
|
|
62,351
|
|
|
Equity of equity method investments
|
$
|
415,746
|
|
|
391,314
|
|
|
Fiscal year ended
|
||||||||
|
December 28,
2013 |
|
December 29,
2012 |
|
December 31,
2011 |
||||
Revenues
|
$
|
673,537
|
|
|
687,676
|
|
|
659,319
|
|
Net income
|
51,407
|
|
|
51,046
|
|
|
44,156
|
|
|
BR Japan
|
|
BR Korea
|
|||||||||
|
December 28,
2013 |
|
December 29,
2012 |
|
December 28,
2013 |
|
December 29,
2012 |
|||||
Carrying value of investment
|
$
|
79,472
|
|
|
95,776
|
|
|
91,121
|
|
|
77,749
|
|
Underlying equity in net assets of investment
|
45,682
|
|
|
54,410
|
|
|
100,766
|
|
|
88,514
|
|
|
Carrying value in excess of (less than) the underlying equity in net assets
(a)
|
$
|
33,790
|
|
|
41,366
|
|
|
(9,645
|
)
|
|
(10,765
|
)
|
(a)
|
The excess carrying values over the underlying equity in net assets of BR Japan is primarily comprised of amortizable franchise rights and related tax liabilities and nonamortizable goodwill, all of which were established in the BCT Acquisition. The deficit of cost relative to the underlying equity in net assets of BR Korea is primarily comprised of an impairment of long-lived assets, net of tax, recorded in fiscal year 2011.
|
|
Dunkin’ Donuts U.S.
|
|
Dunkin’ Donuts International
|
|
Baskin-Robbins International
|
|
Total
|
|||||||||||||||||||||||||||||
|
Goodwill
|
|
Accumulated impairment charges
|
|
Net Balance
|
|
Goodwill
|
|
Accumulated impairment charges
|
|
Net Balance
|
|
Goodwill
|
|
Accumulated impairment charges
|
|
Net Balance
|
|
Goodwill
|
|
Accumulated impairment charges
|
|
Net Balance
|
|||||||||||||
Balances at December 31, 2011
|
$
|
1,151,140
|
|
|
(270,441
|
)
|
|
880,699
|
|
|
10,293
|
|
|
—
|
|
|
10,293
|
|
|
24,037
|
|
|
(24,037
|
)
|
|
—
|
|
|
1,185,470
|
|
|
(294,478
|
)
|
|
890,992
|
|
Goodwill acquired
|
895
|
|
|
—
|
|
|
895
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
895
|
|
|
—
|
|
|
895
|
|
|
Effects of foreign currency adjustments
|
—
|
|
|
—
|
|
|
—
|
|
|
13
|
|
|
—
|
|
|
13
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
13
|
|
|
—
|
|
|
13
|
|
|
Balances at December 29, 2012
|
1,152,035
|
|
|
(270,441
|
)
|
|
881,594
|
|
|
10,306
|
|
|
—
|
|
|
10,306
|
|
|
24,037
|
|
|
(24,037
|
)
|
|
—
|
|
|
1,186,378
|
|
|
(294,478
|
)
|
|
891,900
|
|
|
Goodwill disposed
|
(260
|
)
|
|
—
|
|
|
(260
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(260
|
)
|
|
—
|
|
|
(260
|
)
|
|
Effects of foreign currency adjustments
|
—
|
|
|
—
|
|
|
—
|
|
|
(42
|
)
|
|
—
|
|
|
(42
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(42
|
)
|
|
—
|
|
|
(42
|
)
|
|
Balances at December 28, 2013
|
$
|
1,151,775
|
|
|
(270,441
|
)
|
|
881,334
|
|
|
10,264
|
|
|
—
|
|
|
10,264
|
|
|
24,037
|
|
|
(24,037
|
)
|
|
—
|
|
|
1,186,076
|
|
|
(294,478
|
)
|
|
891,598
|
|
|
Weighted
average
amortization
period
(years)
|
|
Gross
carrying
amount
|
|
Accumulated
amortization
|
|
Net
carrying
amount
|
||||
Definite-lived intangibles:
|
|
|
|
|
|
|
|
||||
Franchise rights
|
20
|
|
$
|
383,465
|
|
|
(159,719
|
)
|
|
223,746
|
|
Favorable operating leases acquired
|
16
|
|
71,788
|
|
|
(35,653
|
)
|
|
36,135
|
|
|
License rights
|
10
|
|
6,230
|
|
|
(4,876
|
)
|
|
1,354
|
|
|
Indefinite-lived intangible:
|
|
|
|
|
|
|
|
||||
Trade names
|
N/A
|
|
1,190,970
|
|
|
—
|
|
|
1,190,970
|
|
|
|
|
|
$
|
1,652,453
|
|
|
(200,248
|
)
|
|
1,452,205
|
|
|
Weighted
average
amortization
period
(years)
|
|
Gross
carrying
amount
|
|
Accumulated
amortization
|
|
Net
carrying
amount
|
||||
Definite-lived intangibles:
|
|
|
|
|
|
|
|
||||
Franchise rights
|
20
|
|
$
|
384,065
|
|
|
(139,677
|
)
|
|
244,388
|
|
Favorable operating leases acquired
|
15
|
|
77,653
|
|
|
(35,207
|
)
|
|
42,446
|
|
|
License rights
|
10
|
|
6,230
|
|
|
(4,250
|
)
|
|
1,980
|
|
|
Indefinite-lived intangible:
|
|
|
|
|
|
|
|
||||
Trade names
|
N/A
|
|
1,190,970
|
|
|
—
|
|
|
1,190,970
|
|
|
|
|
|
$
|
1,658,918
|
|
|
(179,134
|
)
|
|
1,479,784
|
|
|
December 28,
2013 |
|
December 29,
2012 |
|||
Term loans
|
$
|
1,823,609
|
|
|
1,849,958
|
|
Less current portion of long-term debt
|
5,000
|
|
|
26,680
|
|
|
Total long-term debt
|
$
|
1,818,609
|
|
|
1,823,278
|
|
|
2017 Term Loans
|
|
2021 Term Loans
|
|
Total
|
||||
2014
|
$
|
3,375
|
|
|
—
|
|
|
3,375
|
|
2015
|
4,500
|
|
|
10,342
|
|
|
14,842
|
|
|
2016
|
4,500
|
|
|
13,789
|
|
|
18,289
|
|
|
2017
|
437,625
|
|
|
13,789
|
|
|
451,414
|
|
|
2018
|
—
|
|
|
13,789
|
|
|
13,789
|
|
|
December 28,
2013 |
|
December 29,
2012 |
|
Consolidated balance sheet classification
|
|||
Interest rate swaps - asset
|
$
|
10,221
|
|
|
—
|
|
|
Other assets
|
Total fair values of derivative instruments - asset
|
$
|
10,221
|
|
|
—
|
|
|
|
|
December 28,
2013 |
|
December 29,
2012 |
|
Consolidated balance sheet classification
|
|||
Interest rate swaps - liability
|
$
|
—
|
|
|
2,809
|
|
|
Other long-term liabilities
|
Total fair values of derivative instruments - liability
|
$
|
—
|
|
|
2,809
|
|
|
|
Derivatives designated as cash flow hedging instruments
|
|
Amount of gain (loss) recognized in other comprehensive income (loss)
|
|
Amount of net gain (loss) reclassified into earnings
|
|
Consolidated statement of operations classification
|
|
Total effect on other comprehensive income (loss)
|
||||
Interest rate swaps
|
|
$
|
9,648
|
|
|
(3,382
|
)
|
|
Interest expense
|
|
13,030
|
|
Income tax effect
|
|
(3,909
|
)
|
|
1,381
|
|
|
Provision for income taxes
|
|
(5,290
|
)
|
|
Net of income taxes
|
|
$
|
5,739
|
|
|
(2,001
|
)
|
|
|
|
7,740
|
|
Derivatives designated as cash flow hedging instruments
|
|
Amount of gain (loss) recognized in other comprehensive income (loss)
|
|
Amount of net gain (loss) reclassified into earnings
|
|
Consolidated statement of operations classification
|
|
Total effect on other comprehensive income (loss)
|
||||
Interest rate swaps
|
|
$
|
(3,673
|
)
|
|
(864
|
)
|
|
Interest expense
|
|
(2,809
|
)
|
Income tax effect
|
|
1,509
|
|
|
355
|
|
|
Provision for income taxes
|
|
1,154
|
|
|
Net of income taxes
|
|
$
|
(2,164
|
)
|
|
(509
|
)
|
|
|
|
(1,655
|
)
|
|
December 28,
2013 |
|
December 29,
2012 |
|||
Gift card/certificate liability
|
$
|
139,721
|
|
|
145,981
|
|
Gift card breakage liability
|
14,093
|
|
|
—
|
|
|
Accrued salary and benefits
|
26,713
|
|
|
31,136
|
|
|
Accrued legal liabilities (see note 17(d))
|
26,633
|
|
|
27,305
|
|
|
Accrued interest
|
9,999
|
|
|
13,564
|
|
|
Accrued professional costs
|
2,938
|
|
|
2,996
|
|
|
Other
|
28,821
|
|
|
18,949
|
|
|
Total other current liabilities
|
$
|
248,918
|
|
|
239,931
|
|
|
December 28,
2013 |
|
December 29,
2012 |
|||
Leased property under capital leases (included in property and equipment)
|
$
|
7,888
|
|
|
7,902
|
|
Accumulated depreciation
|
(2,326
|
)
|
|
(2,003
|
)
|
|
Net leased property under capital leases
|
$
|
5,562
|
|
|
5,899
|
|
Capital lease obligations:
|
|
|
|
|||
Current
|
$
|
432
|
|
|
371
|
|
Long-term
|
6,996
|
|
|
7,251
|
|
|
Total capital lease obligations
|
$
|
7,428
|
|
|
7,622
|
|
|
December 28,
2013 |
|
December 29,
2012 |
|||
Land
|
$
|
29,701
|
|
|
27,210
|
|
Buildings
|
41,721
|
|
|
39,242
|
|
|
Leasehold improvements
|
135,177
|
|
|
141,264
|
|
|
Store, production, and other equipment
|
146
|
|
|
149
|
|
|
Construction in progress
|
1,363
|
|
|
1,384
|
|
|
Assets leased to others, gross
|
208,108
|
|
|
209,249
|
|
|
Accumulated depreciation
|
(71,535
|
)
|
|
(71,100
|
)
|
|
Assets leased to others, net
|
$
|
136,573
|
|
|
138,149
|
|
|
Payments
|
|
Receipts
Subleases
|
|
Net
leases
|
||||||||
|
Capital
leases
|
|
Operating
leases
|
|
|||||||||
Fiscal year:
|
|
|
|
|
|
|
|
||||||
2014
|
$
|
1,031
|
|
|
52,930
|
|
|
(61,929
|
)
|
|
(7,968
|
)
|
|
2015
|
1,064
|
|
|
51,710
|
|
|
(61,043
|
)
|
|
(8,269
|
)
|
||
2016
|
1,068
|
|
|
50,563
|
|
|
(61,026
|
)
|
|
(9,395
|
)
|
||
2017
|
1,090
|
|
|
50,467
|
|
|
(60,525
|
)
|
|
(8,968
|
)
|
||
2018
|
1,106
|
|
|
49,811
|
|
|
(59,305
|
)
|
|
(8,388
|
)
|
||
Thereafter
|
6,655
|
|
|
384,354
|
|
|
(347,138
|
)
|
|
43,871
|
|
||
Total minimum rental commitments
|
12,014
|
|
|
$
|
639,835
|
|
|
(650,966
|
)
|
|
883
|
|
|
Less amount representing interest
|
4,586
|
|
|
|
|
|
|
|
|||||
Present value of minimum capital lease obligations
|
$
|
7,428
|
|
|
|
|
|
|
|
|
Fiscal year ended
|
||||||||
|
December 28,
2013 |
|
December 29,
2012 |
|
December 31,
2011 |
||||
Base rentals
|
$
|
53,462
|
|
|
52,821
|
|
|
52,214
|
|
Contingent rentals
|
5,869
|
|
|
5,227
|
|
|
4,510
|
|
|
Total rental expense
|
$
|
59,331
|
|
|
58,048
|
|
|
56,724
|
|
|
Fiscal year ended
|
||||||||
|
December 28,
2013 |
|
December 29,
2012 |
|
December 31,
2011 |
||||
Base rentals
|
$
|
66,540
|
|
|
67,988
|
|
|
66,061
|
|
Contingent rentals
|
29,542
|
|
|
28,828
|
|
|
26,084
|
|
|
Total rental income
|
$
|
96,082
|
|
|
96,816
|
|
|
92,145
|
|
|
Fiscal year ended
|
||||||||
|
December 28,
2013 |
|
December 29,
2012 |
|
December 31,
2011 |
||||
Increase in rental income
|
$
|
973
|
|
|
1,065
|
|
|
1,392
|
|
Decrease in rental expense
|
1,204
|
|
|
1,287
|
|
|
1,838
|
|
|
Total increase in operating income
|
$
|
2,177
|
|
|
2,352
|
|
|
3,230
|
|
|
Decrease in
rental expense
|
|
Increase in
rental income
|
|
Total increase
in operating
income
|
||||
Fiscal year:
|
|
|
|
|
|
||||
2014
|
$
|
1,051
|
|
|
847
|
|
|
1,898
|
|
2015
|
949
|
|
|
789
|
|
|
1,738
|
|
|
2016
|
893
|
|
|
719
|
|
|
1,612
|
|
|
2017
|
893
|
|
|
681
|
|
|
1,574
|
|
|
2018
|
859
|
|
|
632
|
|
|
1,491
|
|
|
Revenues
|
||||||||
|
Fiscal year ended
|
||||||||
|
December 28, 2013
|
|
December 29, 2012
|
|
December 31, 2011
|
||||
Dunkin’ Donuts U.S.
|
$
|
521,179
|
|
|
485,399
|
|
|
449,492
|
|
Dunkin’ Donuts International
|
18,316
|
|
|
15,485
|
|
|
15,253
|
|
|
Baskin-Robbins U.S.
|
42,152
|
|
|
42,074
|
|
|
43,455
|
|
|
Baskin-Robbins International
|
120,333
|
|
|
101,975
|
|
|
106,887
|
|
|
Total reportable segments
|
701,980
|
|
|
644,933
|
|
|
615,087
|
|
|
Other
|
11,860
|
|
|
13,248
|
|
|
13,111
|
|
|
Total revenues
|
$
|
713,840
|
|
|
658,181
|
|
|
628,198
|
|
|
Segment profit
|
||||||||
|
Fiscal year ended
|
||||||||
|
December 28, 2013
|
|
December 29, 2012
|
|
December 31, 2011
|
||||
Dunkin’ Donuts U.S.
|
$
|
379,751
|
|
|
355,274
|
|
|
334,308
|
|
Dunkin’ Donuts International
|
7,479
|
|
|
9,670
|
|
|
11,528
|
|
|
Baskin-Robbins U.S.
|
27,081
|
|
|
26,274
|
|
|
21,593
|
|
|
Baskin-Robbins International
|
54,321
|
|
|
42,004
|
|
|
42,844
|
|
|
Total reportable segments
|
468,632
|
|
|
433,222
|
|
|
410,273
|
|
|
Corporate and other
|
(113,967
|
)
|
|
(136,488
|
)
|
|
(150,382
|
)
|
|
Interest expense, net
|
(79,831
|
)
|
|
(73,488
|
)
|
|
(104,449
|
)
|
|
Depreciation and amortization
|
(49,366
|
)
|
|
(56,027
|
)
|
|
(52,522
|
)
|
|
Long-lived asset impairment charges
|
(563
|
)
|
|
(1,278
|
)
|
|
(2,060
|
)
|
|
Loss on debt extinguishment and refinancing transactions
|
(5,018
|
)
|
|
(3,963
|
)
|
|
(34,222
|
)
|
|
Other gains (losses), net
|
(1,799
|
)
|
|
23
|
|
|
175
|
|
|
Income before income taxes
|
$
|
218,088
|
|
|
162,001
|
|
|
66,813
|
|
|
Net income (loss) of equity method investments
|
||||||||
|
Fiscal year ended
|
||||||||
|
December 28, 2013
|
|
December 29, 2012
|
|
December 31, 2011
|
||||
Dunkin’ Donuts International
|
$
|
480
|
|
|
2,211
|
|
|
840
|
|
Baskin-Robbins International
|
15,913
|
|
|
16,578
|
|
|
14,461
|
|
|
Total reportable segments
|
16,393
|
|
|
18,789
|
|
|
15,301
|
|
|
Other
|
1,977
|
|
|
3,562
|
|
|
(18,776
|
)
|
|
Total net income (loss) of equity method investments
|
$
|
18,370
|
|
|
22,351
|
|
|
(3,475
|
)
|
|
Depreciation and amortization
|
||||||||
|
Fiscal year ended
|
||||||||
|
December 28, 2013
|
|
December 29, 2012
|
|
December 31, 2011
|
||||
Dunkin’ Donuts U.S.
|
$
|
18,506
|
|
|
19,021
|
|
|
20,068
|
|
Dunkin’ Donuts International
|
50
|
|
|
92
|
|
|
130
|
|
|
Baskin-Robbins U.S.
|
530
|
|
|
1,052
|
|
|
522
|
|
|
Baskin-Robbins International
|
135
|
|
|
643
|
|
|
866
|
|
|
Total reportable segments
|
19,221
|
|
|
20,808
|
|
|
21,586
|
|
|
Corporate and other
|
30,145
|
|
|
35,219
|
|
|
30,936
|
|
|
Total depreciation and amortization
|
$
|
49,366
|
|
|
56,027
|
|
|
52,522
|
|
|
December 28, 2013
|
|
December 29, 2012
|
|||
United States
|
$
|
182,544
|
|
|
180,525
|
|
International
|
314
|
|
|
647
|
|
|
Total property and equipment, net
|
$
|
182,858
|
|
|
181,172
|
|
|
Effect of
foreign
currency
translation
|
|
Unrealized gains (losses) on interest rate swaps
|
|
Unrealized loss on pension adjustment
|
|
Other
|
|
Accumulated
other
comprehensive
income
|
||||||
Balances at December 29, 2012
|
$
|
14,914
|
|
|
(1,655
|
)
|
|
(2,486
|
)
|
|
(1,632
|
)
|
|
9,141
|
|
Other comprehensive income (loss)
|
(14,909
|
)
|
|
7,740
|
|
|
(612
|
)
|
|
(21
|
)
|
|
(7,802
|
)
|
|
Balances at December 28, 2013
|
$
|
5
|
|
|
6,085
|
|
|
(3,098
|
)
|
|
(1,653
|
)
|
|
1,339
|
|
|
Dividend per share
|
|
Total amount (in thousands)
|
|
Payment date
|
||||
Fiscal year 2013:
|
|
|
|
|
|
||||
First quarter
|
$
|
0.19
|
|
|
$
|
20,191
|
|
|
February 20, 2013
|
Second quarter
|
0.19
|
|
|
20,259
|
|
|
June 6, 2013
|
||
Third quarter
|
0.19
|
|
|
20,257
|
|
|
September 4, 2013
|
||
Fourth quarter
|
0.19
|
|
|
20,301
|
|
|
November 26, 2013
|
|
Dividend per share
|
|
Total amount (in thousands)
|
|
Payment date
|
||||
Fiscal year 2012:
|
|
|
|
|
|
||||
First quarter
|
$
|
0.15
|
|
|
$
|
18,046
|
|
|
March 28, 2012
|
Second quarter
|
0.15
|
|
|
18,068
|
|
|
May 16, 2012
|
||
Third quarter
|
0.15
|
|
|
18,075
|
|
|
August 24, 2012
|
||
Fourth quarter
|
0.15
|
|
|
15,880
|
|
|
November 14, 2012
|
|
Fiscal year ended
|
||||||||
|
December 28, 2013
|
|
December 29, 2012
|
|
December 31, 2011
|
||||
Restricted shares
|
$
|
3
|
|
|
132
|
|
|
2,739
|
|
2006 Plan stock options—executive
|
977
|
|
|
4,245
|
|
|
1,626
|
|
|
2006 Plan stock options—nonexecutive
|
162
|
|
|
181
|
|
|
202
|
|
|
2011 Plan stock options
|
4,668
|
|
|
2,026
|
|
|
32
|
|
|
Restricted stock units
|
1,513
|
|
|
336
|
|
|
33
|
|
|
Total share-based compensation
|
$
|
7,323
|
|
|
6,920
|
|
|
4,632
|
|
Total related tax benefit
|
$
|
2,958
|
|
|
2,768
|
|
|
1,852
|
|
|
Number of
shares
|
|
Weighted
average
grant-date
fair value
|
|||
Nonvested restricted shares at December 29, 2012
|
1,049
|
|
|
$
|
5.44
|
|
Granted
|
—
|
|
|
—
|
|
|
Vested
|
(1,049
|
)
|
|
5.44
|
|
|
Forfeited
|
—
|
|
|
—
|
|
|
Nonvested restricted shares at December 28, 2013
|
—
|
|
|
—
|
|
|
Fiscal year ended
(1)
|
|
December 31,
2011
|
Weighted average grant-date fair value of share options granted
|
$6.27
|
Significant assumptions:
|
|
Tranche 4 options:
|
|
Risk-free interest rate
|
2.1%–2.7%
|
Expected volatility
|
47.0%–72.0%
|
Dividend yield
|
—
|
Expected term (years)
|
6.5
|
Tranche 5 options:
|
|
Risk-free interest rate
|
2.3%–3.2%
|
Expected volatility
|
47.0%–72.0%
|
Dividend yield
|
—
|
|
Number of
shares
|
|
Weighted
average
exercise
price
|
|
Weighted
average
remaining
contractual
term (years)
|
|
Aggregate
intrinsic
value
(in millions)
|
|||||
Share options outstanding at December 29, 2012
|
3,331,993
|
|
|
$
|
3.85
|
|
|
7.3
|
|
|
||
Exercised
|
(932,519
|
)
|
|
3.68
|
|
|
|
|
|
|||
Forfeited or expired
|
(193,527
|
)
|
|
7.15
|
|
|
|
|
|
|||
Share options outstanding at December 28, 2013
|
2,205,947
|
|
|
3.64
|
|
|
6.3
|
|
$
|
97.3
|
|
|
Share options exercisable at December 28, 2013
|
1,067,692
|
|
|
3.29
|
|
|
6.2
|
|
47.5
|
|
|
Fiscal year ended
|
||||
|
December 28, 2013
|
|
December 29, 2012
|
|
December 31, 2011
|
Weighted average grant-date fair value of share options granted
|
9.92
|
|
10.65
|
|
10.27
|
Weighted average assumptions:
|
|
|
|
|
|
Risk-free interest rate
|
1.2%
|
|
0.8%-1.4%
|
|
1.2%-2.7%
|
Expected volatility
|
33.0%
|
|
43.0%
|
|
43.0%-72.0%
|
Dividend yield
|
2.0%
|
|
1.8%-2.1%
|
|
—
|
Expected term (years)
|
6.25
|
|
6.25
|
|
6.25-6.5
|
|
Number of
shares
|
|
Weighted
average
exercise
price
|
|
Weighted
average
remaining
contractual
term (years)
|
|
Aggregate
intrinsic
value
(in millions)
|
|||||
Share options outstanding at December 29, 2012
|
1,295,356
|
|
|
$
|
24.34
|
|
|
8.8
|
|
|
||
Granted
|
1,177,999
|
|
|
37.26
|
|
|
|
|
|
|||
Exercised
|
(207,679
|
)
|
|
21.93
|
|
|
|
|
|
|||
Forfeited or expired
|
(246,526
|
)
|
|
29.92
|
|
|
|
|
|
|||
Share options outstanding at December 28, 2013
|
2,019,150
|
|
|
31.45
|
|
|
8.5
|
|
$
|
32.9
|
|
|
Share options exercisable at December 28, 2013
|
279,932
|
|
|
20.08
|
|
|
7.3
|
|
7.7
|
|
|
Number of
shares
|
|
Weighted average grant-date fair value
|
|||
Nonvested restricted stock units at December 29, 2012
|
22,204
|
|
|
$
|
31.21
|
|
Granted
|
94,495
|
|
|
37.87
|
|
|
Vested
|
(12,655
|
)
|
|
35.44
|
|
|
Forfeited
|
(1,073
|
)
|
|
37.27
|
|
|
Nonvested restricted stock units at December 28, 2013
|
102,971
|
|
|
37.20
|
|
|
Fiscal year ended
|
|||||||||
|
December 28,
2013 |
|
December 29,
2012 |
|
December 31,
2011 |
|||||
Net income attributable to Dunkin' Brands—basic and diluted
|
$
|
146,903
|
|
|
108,308
|
|
|
34,442
|
|
|
Allocation of net income (loss) to common stockholders
(1)
:
|
|
|
|
|
|
|||||
Class L—basic and diluted
|
n/a
|
|
|
n/a
|
|
|
140,212
|
|
||
Common—basic
(2)
|
$
|
146,903
|
|
|
108,176
|
|
|
(105,770
|
)
|
|
Common—diluted
(2)
|
146,903
|
|
|
108,197
|
|
|
(105,770
|
)
|
||
Weighted average number of common shares—basic and diluted:
|
|
|
|
|
|
|||||
Class L—basic and diluted
(3)
|
n/a
|
|
|
n/a
|
|
|
22,845,378
|
|
||
Common—basic
|
106,501,733
|
|
|
114,584,063
|
|
|
74,835,697
|
|
||
Common—diluted
(4)
|
108,217,011
|
|
|
116,573,344
|
|
|
74,835,697
|
|
||
Earnings (loss) per common share:
|
|
|
|
|
|
|||||
Class L—basic
|
n/a
|
|
|
n/a
|
|
|
$
|
6.14
|
|
|
Common—basic
|
$
|
1.38
|
|
|
0.94
|
|
|
(1.41
|
)
|
|
Common—diluted
|
1.36
|
|
|
0.93
|
|
|
(1.41
|
)
|
Class L shares outstanding immediately prior to the initial public offering
|
22,866,379
|
|
|
Number of common shares received for each Class L share
|
0.2189
|
|
|
Common stock received by Class L shareholders, excluding preferential distribution
|
5,005,775
|
|
|
Common stock fair value per share (initial public offering price per share)
|
$
|
19.00
|
|
Fair value of Class L base shares (in thousands)
|
$
|
95,110
|
|
|
Fiscal year ended
|
||||||||
|
December 28,
2013 |
|
December 29,
2012 |
|
December 31,
2011 |
||||
Domestic operations
|
$
|
195,277
|
|
|
172,576
|
|
|
70,034
|
|
Foreign operations
|
22,811
|
|
|
(10,575
|
)
|
|
(3,221
|
)
|
|
Income before income taxes
|
$
|
218,088
|
|
|
162,001
|
|
|
66,813
|
|
|
Fiscal year ended
|
||||||||
|
December 28,
2013 |
|
December 29,
2012 |
|
December 31,
2011 |
||||
Current:
|
|
|
|
|
|
||||
Federal
|
$
|
70,696
|
|
|
52,657
|
|
|
34,282
|
|
State
|
11,758
|
|
|
6,065
|
|
|
5,733
|
|
|
Foreign
|
2,521
|
|
|
2,601
|
|
|
3,719
|
|
|
Current tax provision
|
$
|
84,975
|
|
|
61,323
|
|
|
43,734
|
|
Deferred:
|
|
|
|
|
|
||||
Federal
|
$
|
(11,915
|
)
|
|
(5,071
|
)
|
|
(11,567
|
)
|
State
|
(984
|
)
|
|
4,373
|
|
|
892
|
|
|
Foreign
|
(292
|
)
|
|
(6,248
|
)
|
|
(688
|
)
|
|
Deferred tax benefit
|
(13,191
|
)
|
|
(6,946
|
)
|
|
(11,363
|
)
|
|
Provision for income taxes
|
$
|
71,784
|
|
|
54,377
|
|
|
32,371
|
|
|
Fiscal year ended
|
|||||||
|
December 28,
2013 |
|
December 29,
2012 |
|
December 31,
2011 |
|||
Computed federal income tax expense, at statutory rate
|
35.0
|
%
|
|
35.0
|
%
|
|
35.0
|
%
|
Permanent differences:
|
|
|
|
|
|
|||
Impairment of investment in BR Korea
|
—
|
|
|
—
|
|
|
9.8
|
|
Other permanent differences
|
0.2
|
|
|
0.7
|
|
|
0.9
|
|
State income taxes
|
4.7
|
|
|
5.2
|
|
|
6.9
|
|
Benefits and taxes related to foreign operations
|
(4.3
|
)
|
|
(2.9
|
)
|
|
(6.8
|
)
|
Changes in enacted tax rates and apportionment
|
0.8
|
|
|
2.8
|
|
|
3.0
|
|
Uncertain tax positions
|
(3.2
|
)
|
|
(6.3
|
)
|
|
1.9
|
|
Other
|
(0.3
|
)
|
|
(0.9
|
)
|
|
(2.2
|
)
|
Effective tax rate
|
32.9
|
%
|
|
33.6
|
%
|
|
48.5
|
%
|
|
December 28, 2013
|
|
December 29, 2012
|
|||||||||
|
Deferred tax
assets
|
|
Deferred tax
liabilities
|
|
Deferred tax
assets
|
|
Deferred tax
liabilities
|
|||||
Current:
|
|
|
|
|
|
|
|
|||||
Allowance for doubtful accounts
|
$
|
1,055
|
|
|
—
|
|
|
969
|
|
|
—
|
|
Deferred gift cards and certificates
|
20,371
|
|
|
—
|
|
|
22,561
|
|
|
—
|
|
|
Rent
|
5,307
|
|
|
—
|
|
|
4,990
|
|
|
—
|
|
|
Deferred income
|
4,672
|
|
|
—
|
|
|
3,926
|
|
|
—
|
|
|
Other current liabilities
|
13,983
|
|
|
—
|
|
|
11,422
|
|
|
—
|
|
|
Other
|
1,073
|
|
|
—
|
|
|
3,395
|
|
|
—
|
|
|
Total current
|
46,461
|
|
|
—
|
|
|
47,263
|
|
|
—
|
|
|
Noncurrent:
|
|
|
|
|
|
|
|
|||||
Capital leases
|
2,830
|
|
|
—
|
|
|
2,924
|
|
|
—
|
|
|
Rent
|
2,243
|
|
|
—
|
|
|
2,032
|
|
|
—
|
|
|
Property and equipment
|
—
|
|
|
6,315
|
|
|
—
|
|
|
10,229
|
|
|
Deferred compensation liabilities
|
7,747
|
|
|
—
|
|
|
6,478
|
|
|
—
|
|
|
Deferred income
|
4,234
|
|
|
—
|
|
|
4,905
|
|
|
—
|
|
|
Real estate reserves
|
1,287
|
|
|
—
|
|
|
1,398
|
|
|
—
|
|
|
Franchise rights and other intangibles
|
—
|
|
|
576,567
|
|
|
—
|
|
|
584,642
|
|
|
Unused foreign tax credits
|
6,756
|
|
|
—
|
|
|
8,034
|
|
|
—
|
|
|
Other
|
1,103
|
|
|
4,322
|
|
|
—
|
|
|
26
|
|
|
|
26,200
|
|
|
587,204
|
|
|
25,771
|
|
|
594,897
|
|
|
Valuation allowance
|
(710
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Total noncurrent
|
25,490
|
|
|
587,204
|
|
|
25,771
|
|
|
594,897
|
|
|
|
$
|
71,951
|
|
|
587,204
|
|
|
73,034
|
|
|
594,897
|
|
|
Fiscal year ended
|
||||||||
|
December 28,
2013 |
|
December 29,
2012 |
|
December 31,
2011 |
||||
Balance at beginning of year
|
$
|
15,428
|
|
|
41,379
|
|
|
17,549
|
|
Increases related to prior year tax positions
|
855
|
|
|
2,063
|
|
|
23,922
|
|
|
Increases related to current year tax positions
|
219
|
|
|
1,389
|
|
|
—
|
|
|
Decreases related to prior year tax positions
|
(3,091
|
)
|
|
(19,675
|
)
|
|
—
|
|
|
Decreases related to settlements
|
(4,797
|
)
|
|
(9,792
|
)
|
|
—
|
|
|
Lapses of statutes of limitations
|
—
|
|
|
(27
|
)
|
|
(43
|
)
|
|
Effect of foreign currency adjustments
|
(401
|
)
|
|
91
|
|
|
(49
|
)
|
|
Balance at end of year
|
$
|
8,213
|
|
|
15,428
|
|
|
41,379
|
|
|
Fiscal year ended
|
||||||||
|
December 28,
2013 |
|
December 29,
2012 |
|
December 31,
2011 |
||||
Service cost
|
$
|
—
|
|
|
262
|
|
|
222
|
|
Interest cost
|
216
|
|
|
333
|
|
|
340
|
|
|
Expected return on plan assets
|
(263
|
)
|
|
(317
|
)
|
|
(306
|
)
|
|
Amortization of net actuarial loss
|
74
|
|
|
76
|
|
|
54
|
|
|
Net pension expense
|
$
|
27
|
|
|
354
|
|
|
310
|
|
|
Fiscal year ended
|
||||||||
|
December 28,
2013 |
|
December 29,
2012 |
|
December 31,
2011 |
||||
Change in benefit obligation:
|
|
|
|
|
|
||||
Benefit obligation, beginning of year
|
$
|
8,349
|
|
|
6,050
|
|
|
6,042
|
|
Service cost
|
—
|
|
|
262
|
|
|
222
|
|
|
Interest cost
|
216
|
|
|
333
|
|
|
340
|
|
|
Employee contributions
|
—
|
|
|
88
|
|
|
81
|
|
|
Benefits paid
|
(230
|
)
|
|
(275
|
)
|
|
(479
|
)
|
|
Curtailment gain
|
—
|
|
|
(1,084
|
)
|
|
—
|
|
|
Actuarial loss (gain)
|
395
|
|
|
2,854
|
|
|
(95
|
)
|
|
Foreign currency loss (gain), net
|
(530
|
)
|
|
121
|
|
|
(61
|
)
|
|
Benefit obligation, end of year
|
$
|
8,200
|
|
|
8,349
|
|
|
6,050
|
|
Change in plan assets:
|
|
|
|
|
|
||||
Fair value of plan assets, beginning of year
|
$
|
5,809
|
|
|
4,945
|
|
|
4,797
|
|
Expected return on plan assets
|
263
|
|
|
317
|
|
|
306
|
|
|
Employer contributions
|
626
|
|
|
662
|
|
|
798
|
|
|
Employee contributions
|
—
|
|
|
88
|
|
|
81
|
|
|
Benefits paid
|
(230
|
)
|
|
(275
|
)
|
|
(479
|
)
|
|
Actuarial loss
|
(371
|
)
|
|
(27
|
)
|
|
(505
|
)
|
|
Foreign currency gain (loss), net
|
(307
|
)
|
|
99
|
|
|
(53
|
)
|
|
Fair value of plan assets, end of year
|
$
|
5,790
|
|
|
5,809
|
|
|
4,945
|
|
Reconciliation of funded status:
|
|
|
|
|
|
||||
Funded status
|
$
|
(2,410
|
)
|
|
(2,540
|
)
|
|
(1,105
|
)
|
Net amount recognized at end of period
|
$
|
(2,410
|
)
|
|
(2,540
|
)
|
|
(1,105
|
)
|
Amounts recognized in the balance sheet consist of:
|
|
|
|
|
|
||||
Accrued benefit cost
|
$
|
(2,410
|
)
|
|
(2,540
|
)
|
|
(1,105
|
)
|
Net amount recognized at end of period
|
$
|
(2,410
|
)
|
|
(2,540
|
)
|
|
(1,105
|
)
|
|
December 28,
2013 |
|
December 29,
2012 |
||
Cash and short-term investments
|
35
|
%
|
|
—
|
%
|
Equity securities
|
—
|
|
|
60
|
|
Debt securities
|
65
|
|
|
39
|
|
Other
|
—
|
|
|
1
|
|
|
December 28,
2013 |
|
December 29,
2012 |
||
Discount rate
|
2.65
|
%
|
|
2.70
|
%
|
Average salary increase for pensionable earnings
|
—
|
|
|
—
|
|
|
December 28,
2013 |
|
December 29,
2012 |
|
December 31,
2011 |
|||
Discount rate
|
2.70
|
%
|
|
5.25
|
%
|
|
5.50
|
%
|
Average salary increase for pensionable earnings
|
—
|
|
|
3.25
|
|
|
3.25
|
|
Expected return on plan assets
|
4.50
|
|
|
6.00
|
|
|
6.00
|
|
|
Accounts
receivable
|
|
Short-term notes and other
receivables
|
|
Long-term notes and other
receivables |
||||
Balance at December 25, 2010
|
$
|
5,518
|
|
|
2,443
|
|
|
—
|
|
Provision for doubtful accounts, net
|
745
|
|
|
1,274
|
|
|
—
|
|
|
Write-offs and other
|
(3,550
|
)
|
|
(1,396
|
)
|
|
—
|
|
|
Balance at December 31, 2011
|
2,713
|
|
|
2,321
|
|
|
—
|
|
|
Provision for (recovery of) doubtful accounts, net
|
513
|
|
|
(1,055
|
)
|
|
—
|
|
|
Write-offs and other
|
(743
|
)
|
|
(62
|
)
|
|
—
|
|
|
Balance at December 29, 2012
|
2,483
|
|
|
1,204
|
|
|
—
|
|
|
Provision for (recovery of) doubtful accounts, net
|
1,015
|
|
|
(339
|
)
|
|
2,808
|
|
|
Write-offs and other
|
(899
|
)
|
|
(206
|
)
|
|
—
|
|
|
Balance at December 28, 2013
|
$
|
2,599
|
|
|
659
|
|
|
2,808
|
|
|
Three months ended
|
|||||||||||
|
March 30,
2013 |
|
June 29,
2013 |
|
September 28,
2013 |
|
December 28,
2013 |
|||||
|
(In thousands, except per share data)
|
|||||||||||
Total revenues
|
$
|
161,858
|
|
|
182,488
|
|
|
186,317
|
|
|
183,177
|
|
Operating income
|
63,459
|
|
|
76,805
|
|
|
82,237
|
|
|
82,235
|
|
|
Net income attributable to Dunkin' Brands
|
23,798
|
|
|
40,812
|
|
|
40,221
|
|
|
42,072
|
|
|
Earnings per share:
|
|
|
|
|
|
|
|
|||||
Common – basic
|
0.22
|
|
|
0.38
|
|
|
0.38
|
|
|
0.39
|
|
|
Common – diluted
|
0.22
|
|
|
0.38
|
|
|
0.37
|
|
|
0.39
|
|
|
Three months ended
|
|||||||||||
|
March 31,
2012 |
|
June 30,
2012 |
|
September 29,
2012 |
|
December 29,
2012 |
|||||
|
(In thousands, except per share data)
|
|||||||||||
Total revenues
|
$
|
152,372
|
|
|
172,387
|
|
|
171,719
|
|
|
161,703
|
|
Operating income
(1)
|
55,195
|
|
|
46,138
|
|
|
70,345
|
|
|
67,751
|
|
|
Net income attributable to Dunkin' Brands
(1)
|
25,950
|
|
|
18,497
|
|
|
29,526
|
|
|
34,335
|
|
|
Earnings per share
(1)
:
|
|
|
|
|
|
|
|
|||||
Common – basic
|
0.22
|
|
|
0.15
|
|
|
0.26
|
|
|
0.32
|
|
|
Common – diluted
|
0.21
|
|
|
0.15
|
|
|
0.26
|
|
|
0.32
|
|
(1)
|
The second quarter of fiscal year 2012 includes a
$20.7 million
incremental legal reserve related to the Quebec Superior Court’s ruling in the Bertico litigation, in which the Court found for the Plaintiffs and issued a judgment against Dunkin’ Brands in the amount of approximately
C$16.4 million
(approximately
$15.9 million
), plus costs and interest (see note 17(d)).
|
Item 9.
|
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
|
Item 9A.
|
Controls and Procedures.
|
Item 9B.
|
Other Information
|
Item 10.
|
Directors, Executive Officers and Corporate Governance
|
Item 11.
|
Executive Compensation
|
Item 12.
|
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
|
Item 13.
|
Certain Relationships and Related Transactions, and Director Independence
|
Item 14.
|
Principal Accounting Fees and Services
|
Item 15.
|
Exhibits, Financial Statement Schedules
|
(a)
|
The following documents are filed as part of this report:
|
1.
|
Financial statements: All financial statements are included in Part II, Item 8 of this report.
|
2.
|
Financial statement schedules: All financial statement schedules are omitted because they are not required or are not applicable, or the required information is provided in the consolidated financial statements or notes described in Item 15(a)(1) above.
|
3.
|
Exhibits:
|
Exhibit
Number
|
|
Exhibit Title
|
|
|
|
3.1
|
|
Form of Second Restated Certificate of Incorporation of Dunkin’ Brands Group, Inc. (incorporated by reference to Exhibit 3.1 to the Company’s Registration Statement on Form S-1, File No. 333-173898, as amended on July 11, 2011)
|
|
|
|
3.2
|
|
Form of Second Amended and Restated Bylaws of Dunkin’ Brands Group, Inc. (incorporated by reference to Exhibit 3.2 to the Company’s Registration Statement on Form S-1, File No. 333-173898, as amended on July 11, 2011)
|
|
|
|
4.2
|
|
Specimen Common Stock certificate of Dunkin’ Brands Group, Inc. (incorporated by reference to Exhibit 4.6 to the Company’s Registration Statement on Form S-1, File No. 333-173898, as amended on July 11, 2011)
|
|
|
|
10.1*
|
|
Dunkin’ Brands Group, Inc. (f/k/a Dunkin’ Brands Group Holdings, Inc.) Amended and Restated 2006 Executive Incentive Plan (incorporated by reference to Exhibit 10.1 to the Company’s Registration Statement on Form S-1, File No. 333-173898, filed with the SEC on May 4, 2011)
|
|
|
|
10.2*
|
|
Form of Option Award under 2006 Executive Incentive Plan (incorporated by reference to Exhibit 10.2 to the Company’s Registration Statement on Form S-1, File No. 333-173898, filed with the SEC on May 4, 2011)
|
|
|
|
10.3*
|
|
Form of Restricted Stock Award under 2006 Executive Incentive Plan (incorporated by reference to Exhibit 10.3 to the Company’s Registration Statement on Form S-1, File No. 333-173898, filed with the SEC on May 4, 2011)
|
|
|
|
10.4*
|
|
Dunkin’ Brands Group, Inc. Amended & Restated 2011 Omnibus Long-Term Incentive Plan (incorporated by reference to Exhibit 10.4 to the Company's Annual Report on Form 10-K, File No. 001-35258, filed the with SEC on February 22, 2013)
|
|
|
|
10.5*
|
|
Form of Amended Option Award under 2011 Omnibus Long-Term Incentive Plan
|
|
|
|
10.6*
|
|
Form of Amended Restricted Stock Unit Award under 2011 Omnibus Long-Term Incentive Plan (incorporated by reference to Exhibit 10.6 to the Company's Annual Report on Form 10-K, File No. 001-35258, filed the with SEC on February 22, 2013)
|
|
|
|
10.7*
|
|
Dunkin’ Brands Group, Inc. Annual Incentive Plan (incorporated by reference to Exhibit 10.7 to the Company's Annual Report on Form 10-K, File No. 001-35258, filed the with SEC on February 22, 2013)
|
|
|
|
10.8*
|
|
Amended and Restated Dunkin’ Brands, Inc. Non-Qualified Deferred Compensation Plan
|
|
|
|
10.9*
|
|
First Amended and Restated Executive Employment Agreement between Dunkin’ Brands, Inc., Dunkin’ Brands Group, Inc. and Nigel Travis (incorporated by reference to Exhibit 10.10 to the Company’s Registration Statement on Form S-1, File No. 333-173898, filed with the SEC on May 4, 2011)
|
|
|
|
10.10*
|
|
Amendment No. 1 to First Amended and Restated Executive Employment Agreement between Dunkin’ Brands, Inc., Dunkin’ Brands Group, Inc. and Nigel Travis (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, File No. 001-35258, filed with the SEC on December 3, 2012)
|
|
|
|
10.11*
|
|
Offer Letter to Paul Carbone dated June 4, 2012 (incorporated by reference to Exhibit 10.19 to the Company's Annual Report on Form 10-K, File No. 001-35258, filed the with SEC on February 22, 2013)
|
|
|
|
10.12*
|
|
Offer Letter to John Costello dated September 30, 2009 (incorporated by reference to Exhibit 10.15 to the Company’s Registration Statement on Form S-1, File No. 333-173898, filed with the SEC on May 4, 2011)
|
|
|
|
10.13*
|
|
Offer Letter to Paul Twohig dated September 10, 2009 (incorporated by reference to Exhibit 10.16 to the Company’s Registration Statement on Form S-1, File No. 333-173898, filed with the SEC on May 4, 2011)
|
|
|
|
10.14*
|
|
Offer Letter to Richard Emmett dated November 23, 2009 (incorporated by reference to Exhibit 10.14 to the Company’s Registration Statement on Form S-1, File No. 333-173898, filed with the SEC on May 4, 2011)
|
|
|
|
10.15*
|
|
Form of amendment to Offer Letters (incorporated by reference to Exhibit 10.16(a) to the Company’s Registration Statement on Form S-1, File No. 333-173898, as amended on July 11, 2011)
|
|
|
|
10.16*
|
|
Separation Agreement with Giorgio Minardi, dated October 29, 2013 as revised November 15, 2013
|
|
|
|
10.17*
|
|
Transition Agreement of Jon Luther, dated as of June 30, 2010 (incorporated by reference to Exhibit 10.9 to the Company’s Registration Statement on Form S-1, File No. 333-173898, filed with the SEC on May 4, 2011)
|
|
|
|
10.18
|
|
Form of Non-Competition/Non-Solicitation/Confidentiality Agreement (incorporated by reference to Exhibit 10.17 to the Company’s Registration Statement on Form S-1, File No. 333-173898, filed with the SEC on May 4, 2011)
|
|
|
|
10.19
|
|
Credit Agreement among Dunkin’ Finance Corp, Dunkin’ Brands Holdings, Inc., Dunkin’ Brands, Inc., Barclays Bank PLC and the other lenders party thereto, dated as of November 23, 2010 (incorporated by reference to Exhibit 10.20 to the Company’s Registration Statement on Form S-1, File No. 333-173898, as amended on June 7, 2011)
|
|
|
|
10.20
|
|
Joinder to Credit Agreement dated as of December 3, 2010 (incorporated by reference to Exhibit 10.21 to the Company’s Registration Statement on Form S-1, File No. 333-173898, filed with the SEC on May 4, 2011)
|
|
|
|
10.21
|
|
Amendment 1, dated as of February 18, 2011, to the Credit Agreement among Dunkin’ Brands, Inc., Dunkin’ Brands Holdings, Inc., Barclays Bank PLC and the other lenders party thereto (incorporated by reference to Exhibit 10.22 to the Company’s Registration Statement on Form S-1, File No. 333-173898, filed with the SEC on May 4, 2011)
|
|
|
|
10.22
|
|
Amendment 2, dated as of May 25, 2011, to the Credit Agreement among Dunkin’ Brands, Inc., Dunkin’ Brands Holdings, Inc., Barclays Bank PLC and the other lenders party thereto (incorporated by reference to Exhibit 10.29 to the Company’s Registration Statement on Form S-1, File No. 333-173898, as amended on June 7, 2011)
|
|
|
|
10.23
|
|
Amendment 3, dated as of August 9, 2012, to the Credit Agreement among Dunkin’ Brands, Inc., Dunkin’ Brands Holdings, Inc., Barclays Bank PLC and the other lenders party thereto (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, File No. 001-35258, filed with the SEC on August 9, 2012)
|
|
|
|
10.24
|
|
Amendment 4, dated as of February 14, 2013, to the Credit Agreement among Dunkin’ Brands, Inc., Dunkin’ Brands Holdings, Inc., Barclays Bank PLC and the other lenders party thereto and Amendment No. 1 to the Guaranty among Dunkin' Brands Holdings, Inc., the other guarantors named therein and the Administrative Agent (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, File No. 001-35258, filed with the SEC on February 14, 2013)
|
|
|
|
10.25
|
|
Amendment No. 5 to the Credit Agreement, dated as of February 7, 2014 by and among Dunkin’ Brands, Inc. Dunkin’ Brands Holdings, Inc., Barclays Bank PLC, as administrative agent and the other parties thereto (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K, File No. 001-35258, filed with the SEC on February 7, 2014)
|
|
|
|
10.26
|
|
Security Agreement among the Grantors identified therein and Barclays Bank PLC, dated as of December 3, 2010 (incorporated by reference to Exhibit 10.23 to the Company’s Registration Statement on Form S-1, File No. 333-173898, filed with the SEC on May 4, 2011)
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|
|
|
10.27
|
|
Form of Director and Officer Indemnification Agreement (incorporated by reference to Exhibit 10.24 to the Company’s Registration Statement on Form S-1, File No. 333-173898, as amended on June 7, 2011)
|
|
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10.28
|
|
Lease between 130 Royall, LLC and Dunkin’ Brands, Inc., dated as of December 20, 2013
|
|
|
|
10.29
|
|
Form of Baskin-Robbins Franchise Agreement (incorporated by reference to Exhibit 10.30 to the Company’s Registration Statement on Form S-1, File No. 333-173898, as amended on June 23, 2011)
|
|
|
|
10.30
|
|
Form of Dunkin’ Donuts Franchise Agreement (incorporated by reference to Exhibit 10.33 to the Company's Annual Report on Form 10-K, File No. 001-35258, filed the with SEC on February 22, 2013)
|
|
|
|
10.31
|
|
Form of Combined Baskin-Robbins and Dunkin’ Donuts Franchise Agreement (incorporated by reference to Exhibit 10.34 to the Company's Annual Report on Form 10-K, File No. 001-35258, filed the with SEC on February 22, 2013)
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|
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|
10.32
|
|
Form of Dunkin’ Donuts Store Development Agreement (incorporated by reference to Exhibit 10.34 to the Company’s Annual Report on Form 10-K, File No. 001—35258, filed with the SEC on February 24, 2012)
|
|
|
|
10.33
|
|
Form of Baskin-Robbins Store Development Agreement (incorporated by reference to Exhibit 10.35 to the Company’s Annual Report on Form 10-K, File No. 001—35258, filed with the SEC on February 24, 2012)
|
|
|
|
21.1
|
|
Subsidiaries of Dunkin’ Brands Group, Inc.
|
|
|
|
23.1
|
|
Consent of KPMG LLP
|
|
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31.1
|
|
Certification pursuant to Section 302 of Sarbanes Oxley Act of 2002 by Chief Executive Officer
|
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31.2
|
|
Certification pursuant to Section 302 of Sarbanes Oxley Act of 2002 by Chief Financial Officer
|
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32.1
|
|
Certification of periodic financial report pursuant to Section 906 of Sarbanes Oxley Act of 2002
|
|
|
|
32.2
|
|
Certification of periodic financial report pursuant to Section 906 of Sarbanes Oxley Act of 2002
|
|
|
|
101
|
|
The following financial information from the Company’s Annual Report on Form 10-K for the fiscal year ended December 28, 2013, formatted in Extensible Business Reporting Language, (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Operations, (iii) the Consolidated Statements of Comprehensive Income, (iv) the Consolidated Statements of Stockholders’ Equity (Deficit), (v) the Consolidated Statements of Cash Flows, and (vi) the Notes to the Consolidated Financial Statements
|
*
|
Management contract or compensatory plan or arrangement
|
|
DUNKIN’ BRANDS GROUP, INC.
|
|
|
|
|
|
By:
|
/s/ Nigel Travis
|
|
Name:
|
Nigel Travis
|
|
Title:
|
Chairman and Chief Executive Officer
|
Signature
|
|
Title
|
|
Date
|
|
|
|
|
|
/s/ Nigel Travis
|
|
Chairman and Chief Executive Officer (Principal Executive Officer)
|
|
February 20, 2014
|
Nigel Travis
|
|
|
|
|
|
|
|
|
|
/s/ Paul Carbone
|
|
Chief Financial Officer (Principal Financial and Accounting Officer)
|
|
February 20, 2014
|
Paul Carbone
|
|
|
|
|
|
|
|
|
|
/s/ Raul Alvarez
|
|
Director
|
|
February 20, 2014
|
Raul Alvarez
|
|
|
|
|
|
|
|
|
|
/s/ Anthony DiNovi
|
|
Director
|
|
February 20, 2014
|
Anthony DiNovi
|
|
|
|
|
|
|
|
|
|
/s/ Michael Hines
|
|
Director
|
|
February 20, 2014
|
Michael Hines
|
|
|
|
|
|
|
|
|
|
/s/ Sandra Horbach
|
|
Director
|
|
February 20, 2014
|
Sandra Horbach
|
|
|
|
|
|
|
|
|
|
/s/ Mark Nunnelly
|
|
Director
|
|
February 20, 2014
|
Mark Nunnelly
|
|
|
|
|
|
|
|
|
|
/s/ Carl Sparks
|
|
Director
|
|
February 20, 2014
|
Carl Sparks
|
|
|
|
|
|
|
|
|
|
/s/ Joseph Uva
|
|
Director
|
|
February 20, 2014
|
Joseph Uva
|
|
|
|
|
Name:
|
[●]
|
Number of Shares of Stock subject to Option:
|
[●]
|
Price Per Share:
|
$[●]
|
Date of Grant:
|
[●]
|
(a)
|
“
Beneficiary
” means, in the event of the Optionee’s death, the beneficiary named in the written designation (in form acceptable to the Administrator) most recently filed with the Administrator by the Optionee prior to the Optionee’s death and not subsequently revoked, or, if there is no such designated beneficiary, the executor or administrator of the Optionee’s estate. An effective beneficiary designation will be treated as having been revoked only upon receipt by the Administrator, prior to the Optionee’s death, of an instrument of revocation in form acceptable to the Administrator.
|
(b)
|
“
Good Reason
” means the occurrence of any of the following:
|
(c)
|
“
Option Holder
” means the Optionee or, if as of the relevant time the Stock Option has passed to a Beneficiary, the Beneficiary.
|
(a)
|
Vesting
. As used herein with respect to the Stock Option or any portion thereof, the term “vest” means to become exercisable and the term “vested” as applied to any outstanding Stock Option means that the Stock Option is then exercisable, subject in each case to the terms of the Plan. Unless earlier terminated, forfeited, relinquished or expired, and subject to subsection (b) below, the Stock Option shall become vested as to 25% of the total number of Shares subject to the Stock Option on each of the first four anniversaries of the Date of Grant. Notwithstanding the foregoing, Shares subject to the Stock Option shall not vest on any vesting date unless the Optionee has remained in continuous Employment from the Date of Grant through such vesting date.
|
(b)
|
Change in Control
. If (i) in connection with a Change in Control the Stock Option, to the extent outstanding immediately prior to such Change of Control, is assumed or continued, or a new award is substituted for the Stock Option by the acquiror or survivor (or an affiliate of the acquiror or survivor) in accordance with the provisions of Section 7 of the Plan, and (ii) at any time within the 18-month period following the Change in Control, the Optionee’s Employment is terminated by the Company (or its successor) without Cause or the Optionee terminates his or her Employment for Good Reason, the Stock Option (or the award substituted for the Stock Option), to the extent then outstanding but not then vested, will automatically vest in full at the time of such termination.
|
(c)
|
Exercise of the Stock Option
. No portion of the Stock Option may be exercised until such portion vests. Each election to exercise any vested portion of the Stock Option will be subject to the terms and conditions of the Plan and shall be in writing, signed by the Option Holder (or in such other form as is acceptable to the Administrator). Each such written exercise election must be received by the Company at its principal office or by such other party as the Administrator may prescribe and be accompanied by payment in full as provided in the Plan. The exercise price may be paid (i) by cash or check acceptable to the Administrator, (ii) to the extent permitted by the Administrator, through a broker-assisted cashless exercise program acceptable to the Administrator, (iii) by such other means, if any, as may be acceptable to the Administrator, or (iv) by any combination of the foregoing permissible forms of payment. In the event that the Stock Option is exercised by a person other than the Optionee, the Company will be under no obligation to deliver shares hereunder unless and until it is satisfied as to the authority of the Option Holder to exercise the Stock Option and compliance with applicable securities laws. The latest date on which the Stock Option or any portion thereof may be exercised will be the 7th anniversary of the Date of Grant (the “
Final Exercise Date
”);
provided
,
however
, if at such time the Optionee is prohibited by applicable law or written Company policy applicable to similarly situated employees from engaging in any open-market sales of Stock, the Final Exercise Date will be automatically extended to thirty (30) days following the date the Optionee is no longer prohibited from engaging in such open-market sales. If the Stock Option is not exercised by the Final Exercise Date the Stock Option or any remaining portion thereof will thereupon immediately terminate.
|
(d)
|
Treatment of the Stock Option Upon Cessation of Employment
. If the Optionee’s Employment ceases, the Stock Option, to the extent not already vested will be immediately forfeited, and any vested portion of the Stock Option that is then outstanding will be treated as follows:
|
(a)
|
The Administrator may cancel, rescind, withhold or otherwise limit or restrict the Stock Option at any time if the Optionee is not in compliance with all applicable provisions of this Agreement and the Plan.
|
(b)
|
The Stock Option is subject to Section 6(a)(5) of the Plan. The Stock Option (whether or not vested or exercisable) is subject to forfeiture, termination and rescission, and the Optionee will be obligated to return to the Company the value received with respect to the Stock Option (including Shares delivered under the Stock Option, and any gain realized on a subsequent sale or disposition of Shares), (i) upon or in connection with (A) a breach by the Optionee of a non-competition, non-solicitation, confidentiality or similar covenant or agreement with the Company or its subsidiaries or (B) an overpayment to the Optionee of incentive compensation due to inaccurate financial data, (ii) in accordance with Company policy relating to the recovery of erroneously-paid incentive compensation, as such policy may be amended and in effect from time to time, or (iii) as otherwise required by law or applicable stock exchange listing standards, including, without limitation, the Dodd-Frank Wall Street Reform and Consumer Protection Act.
|
Company:
|
DUNKIN’ BRANDS GROUP, INC.
|
Optionee:
|
__________________________________
|
ARTICLE 1.
|
ESTABLISHMENT OF PLAN
|
ARTICLE
2.
|
DEFINITIONS
|
ARTICLE 3.
|
ADMINISTRATION
|
ARTICLE 4.
|
SELECTION OF PARTICIPANTS
|
ARTICLE 5.
|
DEFERRAL OF COMPENSATION
|
ARTICLE 6.
|
INTEREST EQUIVALENT FACTOR & MEASUREMENT FUNDS
|
ARTICLE 7.
|
PARTICIPANT ACCOUNTS
|
ARTICLE 8.
|
DISTRIBUTION OF ACCOUNT BENEFITS
|
|
(i)
|
A lump sum within 90 days after the Participant’s separation from service;
|
|
(ii)
|
A lump sum within 90 days after the later of (1) the Participant’s separation from service or (2) a specified date which date is not later than the Participant’s 65
th
birthday;
|
|
(iii)
|
In up to 15 annual installments, commencing within 90 days after the Participant’s separation from service; or
|
|
(iv)
|
In up to 15 annual installments, commencing within 90 days after the later of (1) the Participant’s separation from service or (2) a specified date which date is not later than the Participant’s 65
th
birthday.
|
|
|
|
ARTICLE 9.
|
BENEFICIARY BENEFITS
|
|
(i)
|
is issued pursuant to a State’s domestic relations law;
|
|
(ii)
|
relates to the provision of child support, alimony payments or marital property rights to a spouse, former spouse, child or other dependent of the Participant;
|
|
(iii)
|
creates or recognizes the right of a spouse, former spouse, child or other dependent of the Participant to receive all or a portion of the Participant’s benefits under the Plan;
|
|
(iv)
|
clearly specifies the name of the Plan to which such order applies and the name and the last known mailing address of the Participant and each alternate payee covered by the order;
|
|
(v)
|
clearly specifies the amount or percentage of the Participant’s benefits to be paid by the Plan to each such alternate payee, or the manner in which such amount or percentage is to be determined;
|
|
(vi)
|
does not require the payment of benefits to an alternate payee which are required to be paid to another alternate payee under another order previously determined to be a Qualified Domestic Relations order; and
|
|
(vii)
|
meets such other requirements as established by the Committee.
|
|
|
|
|
(i)
|
the rules applicable to “domestic relations orders” under section 414(p) of the Internal Revenue Code of 1986 and section 206(d) of ERISA;
|
|
(ii)
|
the procedures used under the 401(k) Savings Plan to determine the qualified status of domestic relations orders; and
|
|
(iii)
|
such other rules and procedures as it deems relevant.
|
|
|
|
DUNKIN’ BRANDS, INC.
130 Royall Street
Canton, MA 02021
|
||
|
||
/s/ Ted Manley
|
||
|
|
|
By:
|
|
Ted Manley
|
Title:
|
|
Vice President, Total Rewards and H.R. Operations
|
Date:
|
|
4/29/2013
|
1.
|
Separation from Employment.
(a) You acknowledge and agree that your employment with the Company is hereby terminated, effective October 30, 2013 (the “Separation Date”) and that, effective as of the Separation Date, such termination has resulted in your “Separation from Service” for purposes of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”).
|
2.
|
Severance Payment.
As severance, the Company shall provide you with twelve (12) months’ salary, paid at your current base rate of pay, less appropriate taxes, withholdings, and/or deductions. Payment shall be made on the Company’s usual payroll schedule, beginning with the first payroll date after the Effective Date of this Agreement, and in no event later than 60 days from the Separation Date.
|
3.
|
Outplacement.
The Company will pay for twelve (12) months of outplacement services for you following the Separation Date through a firm selected by the Company.
|
4.
|
Equity.
To view a schedule of your holdings as of the Separation Date, you can log on to https://www.schwab.com/publis/eac/home. Options must be exercised in accordance with the timetable set forth in the Company’s post-termination exercise policy and applicable stock agreements. Pursuant to the terms of the applicable stock agreements, vesting on all stock and stock options shall cease as of the Separation Date, any unvested shares of restricted stock and unvested stock options shall be forfeited. You remain subject to the Company’s insider trading policy until the Separation Date, including those provisions applicable to officers or directors. You acknowledge the Company has provided you with a copy of the policy. In addition, please note that pursuant to SEC rules, any purchases (not sales) of Company stock made prior to January 30, 2014 are reportable to the SEC on Form 4.
|
5.
|
Relocation.
The Company will reimburse you for relocation costs, conditional upon return to Italy
, or to a different country or another U.S. state in the event of your employment in that country or state, no later than September 15, 2014
as follows: (a) Business Class airfare for you and your family, in an amount not to exceed that incurred in conjunction with your move to the United States. The Company’s obligation to reimburse you is subject to your provision of appropriate receipts and other documentation as required under the Company’s travel and expense reimbursement policies.
|
6.
|
Benefits.
(a) You may be eligible to convert your Company-provided life insurance to an individual plan, at your own cost, in accordance with the terms and conditions of that plan.
|
7.
|
Release of Claims
to the Company
.
(a) For and in consideration of the payments and benefits set forth herein, to which you acknowledge you are not otherwise entitled, and for other good and valuable consideration, the sufficiency of which is hereby acknowledged, you, on your own behalf and on behalf of your heirs, executors, administrators, beneficiaries, representatives and assigns, hereby release and forever discharge the Company, its parents, subsidiaries and affiliates, and all of their respective past and present officers, directors, shareholders, officers, employees, employee benefit plans, insurers, agents, representatives, successors and assigns (collectively hereafter the “Releasees”), both individually and in their official capacities, from any and all liability, claims, demands, actions and causes of action of any type which you have had in the past, now have, or might now have, from the beginning of the world up to the date that you execute this Agreement, in any way resulting from, arising out of or connected with your employment, its termination, or pursuant to any federal, state or local statute, common law, employment law, regulation or other requirement (including without limitation Title VII of the Civil Rights Act of 1964, the Family and Medical Leave Act, the Pregnancy Discrimination Act, the Age Discrimination in Employment Act, the Older Workers Benefit Protection Act, the Worker’s Adjustment and Retraining Notification Act, the Fair Credit Reporting Act, the Americans with Disabilities Act, the Rehabilitation Act of 1973, the Occupational Safety and Health Act, the Equal Pay Act, the Employee Retirement Income Security Act of 1974, Sections 1981 through 1988 of Title 42 of the United States Code, the Immigration Reform and Control Act, the Massachusetts Wage Act, G.L. c. 149 Sec. 148, the Massachusetts Fair Employment Practices Act, G.L. c. 151B, all state fair employment practices acts, each as amended, and any and all claims for wrongful discharge, discrimination, harassment, retaliation, common law claims, actions in tort, defamation, breach of contract, and claims of interest in unvested stock options, for wages or for attorneys’ fees) as well as any claims arising from your Offer Letter, dated January 31, 2012, any Company severance plan, policy or program, including the former Amended and Restated Executive Separation Pay Plan.
|
8.
|
Transfer of Claims.
You represent and warrant that you have not assigned, transferred, or purported to assign or transfer, to any person, firm, corporation, association, or entity whatsoever, any claim released pursuant to this Agreement. You further agree to indemnify and hold Company harmless against, without any limitation, any and all rights, claims, warranties, demands, debts, obligations, liabilities, costs, court costs, expenses (including attorney’s fees), causes of action or judgments based on or arising out of any such assignment or transfer.
|
9.
|
Restrictive Covenants.
You hereby acknowledge and agree that the Non-Compete/ Non-Solicitation/Confidentiality agreement between you and the Company dated February 1, 2012, attached hereto as
Exhibit A
and incorporated herein by reference, shall survive in its entirety and remain in full force and effect.
|
10.
|
Confidentiality.
(a) You
and the Company (except as required in connection with its disclosure obligations as a public company)
agree to keep the terms and conditions of this Agreement and the facts and circumstances leading up to it confidential and shall not disclose them to anyone except immediate family members, attorneys and financial advisers, and
the Company employees only on a need to know basis as necessary to effectuate the terms of this Agreement (as the case may be), and
only if they agree to keep this information confidential and not disclose it to others, or pursuant to court order, subpoena or as otherwise required by law. Notwithstanding the foregoing, you may disclose paragraphs 5-7 of Exhibit A to prospective employers. (b)
You expressly acknowledge that, in accordance with Exhibit A, you may not use, for the benefit of yourself or any other person or entity, any confidential information, trade secrets or proprietary information of the Company and that you may not disclose such information to anyone outside the Company, except where required by law. (c) If you are requested or required to disclose any confidential or proprietary information of the Company, or the terms and conditions of this Agreement to a court or governmental agency, you shall notify the Company’s General Counsel in writing within 3 business days after you learn of such obligation or request, and permit the Company to take all lawful actions it deems necessary to prevent or limit such disclosure.
|
11.
|
Non-Disparagement.
(a)
You agree that you will not directly or indirectly disparage, in any way cause disparagement, or encourage others to disparage, the Company, its affiliates, subsidiaries or any of its directors, officers or employees, its products, services, marketing or advertising programs, financial status or business.
|
12.
|
Return of Company Property.
You represent and warrant that as of the Separation Date, and before the Company is obligated to provide you with any pay or benefits hereunder, you shall return all Confidential Information of the Company (as defined in Exhibit A), materials that incorporate or reference such Confidential Information, and all copies thereof, all Company assets, such as computer(s), PDA(s), telephone(s), vehicles, and credit cards, all documents, materials, records, files and information, in any media, related to the business of the Company, including all copies, and all keys or other property of the Company in your possession or control.
|
13.
|
Cooperation.
You agree to cooperate reasonably with the Company in its defense of any investigation, litigation or administrative proceeding, including any charges or claims filed against it by current or former employees, regarding all matters occurring during your employment. The Company shall
fully
reimburse you for reasonable out of pocket expenses incident to such cooperation provided they are properly documented
pursuant to the same Company policies applicable to other executives and officers
.
|
14.
|
Transition.
This Agreement represents your resignation as an Officer of the Company, from any board or committee memberships and other positions which you hold with the Company, and all of its subsidiaries and affiliates, effective October 30, 2013. You agree to execute and return to the Company any documents or to take any action it deems necessary to separately confirm your resignation from such positions. You agree to make yourself reasonably available to the Company and its officers as necessary to ensure a smooth transition.
|
15.
|
Breach.
Your breach of any of the terms set forth in this Agreement shall constitute a material breach of this Agreement
subject to the terms of this paragraph and Agreement
and shall relieve the Company of any further obligations hereunder. In addition to any other legal or equitable remedy available to the Company, it shall be entitled to recover any monies paid pursuant to you pursuant to this Agreement.
In the event the Company claims a material breach of this Agreement, it shall provide you with written notice regarding the alleged claim or material breach and the opportunity to respond to the allegations within 14 days. If after good faith consideration of your response the Company intends to terminate this Agreement or otherwise ceases any payments or benefits to you under it, the matter shall be referred to arbitration pursuant to paragraph 22 of this Agreement.
|
16.
|
Release of Known Claims as to You.
(a) For the benefits and covenants set forth herein, to which the Company acknowledges it is not otherwise entitled, and for other good and valuable consideration, the sufficiency of which is hereby acknowledged, the Company, for itself and its parents, subsidiaries and affiliates, and all of their respective past and present officers, directors, shareholders, employees, insurers, agents, representatives, successors and assigns (collectively hereafter the “Releasors”), both individually and in their official capacities, hereby release and forever discharge you, on your own behalf and on behalf of your heirs, executors, administrators, beneficiaries, representatives and assigns (Releasees) from any and all liability, claims, demands, actions, and causes of action of any type of which the Company has actual knowledge and which the Releasors have had in the past, or nor have, from the beginning of the world up to the date that Company executes this Agreement, in any way resulting from, arising out of or in connection with your employment with the Company.
|
17.
|
No Liability or Wrongdoing.
The parties hereto agree and acknowledge that this Agreement is intended only to settle all matters between the parties and nothing contained in this Agreement, nor any of its terms and provisions, nor any of the negotiations or proceedings connected with it, constitutes, will be construed to constitute, will be offered in evidence as or deemed to be evidence of an admission of liability or wrongdoing by any of the Releasees, and any such liability or wrongdoing is hereby expressly denied by each of the Releasees.
|
18.
|
Method of Payment.
All payments contemplated hereunder will be made by the Company using such payment method as it may determine in its discretion, including without limitation direct deposit into your bank account, unless you specifically advise the Company in writing otherwise. Unless you advise the Company of any changes to your banking information, any payments made by direct deposit will be made into such bank account as is currently on file with the Company’s payroll department.
|
19.
|
Accord and Satisfaction.
By executing this Agreement, you acknowledge and agree that you are not entitled to any further wages, compensation, stock, commissions, bonuses, severance, incentives or other monies or payments of any nature, or to any benefits from the Company except and unless as explicitly provided in this Agreement. You further acknowledge that no promises, inducements or other consideration not expressly stated in this Agreement have been made or otherwise exist with respect to the terms and conditions of this Agreement, and that this Agreement may only be modified in accordance with paragraph 24(a).
|
20.
|
Re-employment.
You agree that you will neither apply for nor accept employment with the Company, any of its parents, subsidiaries, affiliates, or any other entity controlled by, or under common control with, the Company (the “Company Entities”), that the Company Entities are not obligated to reinstate or re-employ you in the future in any capacity, and you hereby discharge the Company Entities from any liability or obligation to reinstate or re-employ you in any capacity. You acknowledge that your forbearance from doing so is contractual and is in no way discriminatory, retaliatory or involuntary.
|
21.
|
Payment of Applicable Taxes and 409A.
(a)
While this Agreement and the payments and benefits provided hereunder are intended to be exempt from, or comply with, the requirements of Section 409A of the Code, and at all times should be interpreted so as to comply, the Company makes no representation or covenant to ensure that any payment or benefits provided under this Agreement are exempt from, or compliant with Section 409A. The Company shall have no liability to you or any other party if any payment or benefit under this Agreement is challenged by any taxing authority or is ultimately determined not to be exempt or compliant.
You
agree and acknowledge that to the extent some or all of the payments made in consideration of this Agreement may be taxable to you, you shall be responsible for all applicable federal, state and local taxes on said payments, and any costs, interest or penalties incurred as a result of your failure to pay such taxes. In the event that it is determined that
you have
failed to make proper payment of such taxes and Company is held liable for your non-payment, or for any fines or penalties connected therewith, Company will be entitled to full and complete indemnification from
you
for those amounts (including taxes, fines and/or penalties) for which Company is held liable.
|
22.
|
Dispute Resolution.
With respect to any claims or disputes arising under or in connection with this Agreement, you and the Company agree to attempt in good faith to resolve such claim or dispute informally through discussions with an authorized executive officer of the Company. If after completing the foregoing procedure the dispute is not resolved, the Company and you agree that the dispute or claim shall be resolved by final and binding arbitration before the American Arbitration Association (“AAA”). The arbitration shall be held in Boston, Massachusetts and shall be conducted in accordance with the AAA’s National Rules for the Resolution of Employment Disputes then in effect at the time of the arbitration, except that in the process of selecting an arbitrator, the parties may strike names from the AAA’s list of arbitrators for good cause, and with the additional condition that all steps reasonably necessary to ensure the confidentiality of the proceedings and the arbitrator’s determination will be added to the basic rules and requirements. Notwithstanding the foregoing, any arbitration pursuant to this paragraph shall not impair either party’s right to request injunctive or other equitable relief in connection with Exhibit A.
|
23.
|
Acknowledgement, Acceptance and Revocation.
(a) You acknowledge that you are signing this Agreement knowingly, voluntarily, with full understanding of its terms and effects and without duress, coercion, fraud or undue influence;
|
24.
|
Miscellaneous.
(a) This Agreement shall be binding upon the parties and may not be modified in any manner, except by an instrument in writing of concurrent or subsequent date signed by a duly authorized representative of the parties hereto. This Agreement is binding upon and shall inure to the benefit of the parties and their respective agents, heirs, executors, administrators, successors and assigns.
|
1.
|
DEFINITIONS; USE AND RESTRICTIONS ON USE. 1
|
2.
|
TERM. 2
|
3.
|
RENT. 3
|
4.
|
ADDITIONAL RENT. 4
|
5.
|
OPTION TO EXPAND. 5
|
6.
|
COMPLETION OF THE PREMISES. 5
|
7.
|
REPAIR. 7
|
8.
|
LIENS 7
|
9.
|
ASSIGNMENT AND SUBLETTING. 8
|
10.
|
INDEMNIFICATION 9
|
11.
|
INSURANCE. 9
|
12.
|
WAIVER OF SUBROGATION 10
|
13.
|
ELECTRICITY 10
|
14.
|
HOLDING OVER 10
|
15.
|
SUBORDINATION; NONDISTURBANCE; ATTORNMENT. 11
|
16.
|
LANDLORD SERVICES 12
|
17.
|
REENTRY BY LANDLORD. 12
|
18.
|
DEFAULT BY TENANT AND LANDLORD REMEDIES. 12
|
19.
|
DEFAULT BY LANDLORD AND TENANT REMEDIES. 16
|
20.
|
TENANT’S BANKRUPTCY OR INSOLVENCY. 17
|
21.
|
QUIET ENJOYMENT 18
|
22.
|
CASUALTY. 18
|
23.
|
EMINENT DOMAIN 19
|
24.
|
SALE BY LANDLORD 19
|
25.
|
ESTOPPEL CERTIFICATES 20
|
26.
|
SURRENDER OF PREMISES. 20
|
27.
|
NOTICES 20
|
28.
|
DEFINED TERMS AND HEADINGS 21
|
29.
|
TENANT’S AUTHORITY 21
|
30.
|
COMMISSIONS 21
|
31.
|
TIME AND APPLICABLE LAW 21
|
32.
|
SUCCESSORS AND ASSIGNS 21
|
33.
|
ENTIRE AGREEMENT 22
|
34.
|
EXAMINATION NOT OPTION 22
|
35.
|
RECORDATION 22
|
36.
|
LIMITATION OF LANDLORD’S LIABILITY 22
|
37.
|
ACCESS 22
|
38.
|
COMMUNICATIONS EQUIPMENT 22
|
39.
|
COMPLIANCE WITH LAWS. 23
|
40.
|
CONTEST OF LEGAL REQUIREMENTS 23
|
41.
|
SIGNAGE 23
|
42.
|
WORK ON THE BUILDING OR LAND. 23
|
43.
|
ARBITRATION. 25
|
44.
|
FINANCIALS 26
|
45.
|
RIGHT OF FIRST REFUSAL 26
|
BUILDING:
|
130 Royall Street, Canton, Massachusetts
|
|
LANDLORD:
|
130 ROYALL, LLC
|
|
LANDLORD’S ADDRESS:
|
130 ROYALL, LLC
c/o HN Gorin
101 Huntington Avenue
5
th
Floor
Boston, Massachusetts 02199
Attention: Kristian Gibson
|
|
LEASE REFERENCE DATE:
|
December___, 2013
|
|
TENANT:
|
Dunkin’ Brands, Inc.
|
|
TENANT’S ADDRESS:
|
Dunkin’ Brands, Inc.
130 Royall Street
Canton, MA 02021
Attention: Jason Maceda, Vice President, US Financial Planning & Field Treasury
With a copy to:
Dunkin’ Brands, Inc.
130 Royall Street
Canton, MA 02021
Attention: Christopher J. Egan, Director & Legal Counsel
|
|
PREMISES:
|
The land and building (the "
Building
") commonly known and numbered as 130 Royall Street, Canton, Massachusetts, including all improvements located thereon and all sidewalks and driveways and parking areas, as shown on the Plan attached hereto as
Exhibit “A”
. The land (the "
Land
") upon which the Building is located is described on
Exhibit “A-1
” attached hereto. The definition of the Premises may be modified pursuant to Article 5 of this Lease.
|
|
PERMITTED USE:
|
Office, kitchen and laboratory purposes and all activities normally incidental thereto or related to the conduct of Tenant’s business, including vending machines and food service for employees and guests and for all other lawful purposes normally associated with a first class office and/or research and development building.
|
|
COMMENCEMENT DATE:
|
January 1, 2014
|
|
RENT COMMENCEMENT DATE
|
January 1, 2014
|
|
|
|
|
TERM OF LEASE:
|
Commencement Date through December 31, 2029
|
|
EXPIRATION DATE:
|
December 31, 2029
|
|
|
|
|
OPTIONS TO EXTEND
ANNUAL RENT (Article 3):
Calendar Year
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
|
Two (2) options to extend the Term for five (5) years each, as set forth in Section 2.2
Annual Rent
Monthly Installments
$2,625,000.00 $218,750.00
$2,712,500.00 $226,041.67
$2,800,000.00 $233,333.33
$2,887,500.00 $240,625.00
$2,975,000.00 $247,916.67
$3,062,500.00 $255,208.33
$3,150,000.00 $262,500.00
$3,150,000.00 $262,500.00
$3,150,000.00 $262,500.00
$3,150,000.00 $262,500.00
$3,150,000.00 $262,500.00
$3,675,000.00 $306,250.00
$3,675,000.00 $306,250.00
$3,675,000.00 $306,250.00
$3,675,000.00 $306,250.00
$3,675,000.00 $306,250.00
|
|
|
|
|
BUILDING RENTABLE AREA:
|
175,000 rentable square feet
|
|
TENANT ALLOWANCES:
|
$2,000,000 which will be offset in equal monthly installments against monthly payments of Annual Rent over the first seven (7) years of the Term, as set forth in greater detail in Article 4 of this Lease.
$3,000,000 payable in a lump sum between January 1, 2020 and December 31, 2021, as set forth in greater detail in Article 4 of this Lease.
$12,000 per year which will be offset in equal monthly installments against monthly payments of Annual Rent over the first seven (7) years of the Term, as set forth in greater detail in Article 4 of this Lease.
$670,000 which will be offset in monthly installments against monthly payments of Annual Rent over the second (2
nd
) and third (3
rd
) years of the Term, as set forth in greater detail in Article 4 of this Lease.
|
|
|
|
|
|
|
|
REAL ESTATE BROKER DUE COMMISSION:
|
Newmark Real Estate of Massachusetts, LLC c/o Newmark & Company Real Estate, Inc.
125 Park Avenue
New York, NY 10017
Attention: Neal Golden
With a copy to:
Newmark Southern Region, LLC
3424 Peachtree Road, NE, Suite 800
Atlanta, GA 30326
Attention: Bert Sanders
|
|
Security Deposit
|
$10,000.00
|
LANDLORD:
130 ROYALL, LLC
By:________________________________
Title:_______________________________
Dated: December ____, 2013
|
TENANT:
DUNKIN’ BRANDS, INC.
By:
Title:
Dated: December ____, 2013
|
|
|
(a)
|
liable for any act, omission, negligence or default of any prior landlord, including Landlord (except with regard to defaults of a continuing nature); provided, however, that Lender and any Acquiring Party shall be liable and responsible for the performance of all covenants and obligations of any prior landlord, including Landlord, under the Lease occurring from and after the date that it takes title to the Premises; or
|
(b)
|
subject to any offsets, credits, claims or defenses which Tenant might have against any prior landlord, including Landlord (except with regard to defaults of a continuing nature); or
|
(c)
|
bound by any rent or additional rent which is payable on a monthly basis and which Tenant might have paid for more than one (1) month in advance to any prior landlord, including Landlord.
|
|
|
|
Entity
|
|
Jurisdiction of Organization
|
Dunkin’ Brands Group, Inc.
|
|
Delaware
|
Dunkin’ Brands Holdings, Inc.
|
|
Delaware
|
Dunkin’ Brands, Inc.
|
|
Delaware
|
Dunkin’ Brands Canada, Ltd.
|
|
Ontario, Canada
|
SVC Service LLC
|
|
Colorado
|
SVC Service II Inc.
|
|
Colorado
|
Dunkin Brands International Holdings Ltd.
|
|
United Kingdom
|
Dunkin Brands International DMCC
|
|
Dubai
|
Dunkin’ Brands (UK) Limited
|
|
United Kingdom
|
Baskin-Robbins Australia Pty. Ltd.
|
|
Australia
|
Dunkin’ Brands Australia Pty. Ltd.
|
|
Australia
|
DBI Australia Holdings Pty. Ltd.
|
|
Australia
|
Palm Oasis Ventures Pty. Ltd.
5
|
|
Australia
|
B-R 31 Ice Cream Co. Ltd.
4
|
|
Japan
|
Dunkin’ (Shanghai) Enterprise Management Consulting Co., Ltd.
|
|
China
|
DBCI Corp.
|
|
Florida
|
Dunkin’ Donuts LLC
|
|
Delaware
|
Dunkin Espanola S.A.
|
|
Spain
|
Coffee Alliance, S.L.
3
|
|
Spain
|
Dunkin’ Ventures LLC
|
|
Delaware
|
Massachusetts Refreshment Corp.
1
|
|
Massachusetts
|
Third Dunkin’ Donuts Realty LLC
|
|
Delaware
|
Dunkin’ Donuts Realty Investment LLC
|
|
Delaware
|
Dunkin’ Donuts USA LLC
|
|
Delaware
|
Mister Donut of America, LLC
|
|
Delaware
|
Baskin-Robbins LLC
|
|
Delaware
|
Baskin-Robbins USA LLC
|
|
California
|
DBI Stores LLC
|
|
Delaware
|
Star Dunkin’, LP
2
|
|
Delaware
|
Star Dunkin’ Real Estate, LP
2
|
|
Delaware
|
DBI Stores Texas LLC
|
|
Delaware
|
Baskin-Robbins Flavors LLC
|
|
Delaware
|
Baskin-Robbins International LLC
|
|
Delaware
|
B-R Korea Co. Ltd.
3
|
|
Korea
|
DB Master Finance LLC
|
|
Delaware
|
DB Canadian Supplier Inc.
|
|
Delaware
|
DB Canadian Holding Company Inc.
|
|
Delaware
|
DB Canadian Franchising ULC
|
|
Nova Scotia
|
BR Japan Holdings LLC
|
|
Delaware
|
DB Franchising Holding Company LLC
|
|
Delaware
|
Dunkin’ Donuts Franchising LLC
|
|
Delaware
|
Baskin-Robbins Franchising LLC
|
|
Delaware
|
DB Real Estate Assets I LLC
|
|
Delaware
|
DB Real Estate Assets II LLC
|
|
Delaware
|
DB Mexican Franchising LLC
|
|
Delaware
|
DB International Franchising LLC
|
|
Delaware
|
DD IP Holder LLC
|
|
Delaware
|
BR IP Holder LLC
|
|
Delaware
|
Baskin-Robbins Franchised Shops LLC
|
|
Delaware
|
Dunkin’ Donuts Franchised Restaurants LLC
|
|
Delaware
|
DB AdFund Administrator LLC
|
|
Delaware
|
DB UK Franchising LLC
|
|
Delaware
|
______________
|
||
1
|
|
Represents a joint venture company of which registrant indirectly owns 50% of the voting equity.
|
2
|
|
Represents a joint venture partnership of which registrant indirectly owns 51% of the partnership interest.
|
3
|
|
Represents a joint venture company of which registrant indirectly owns 33.3% of the voting equity.
|
4
|
|
Represents a joint venture company of which registrant indirectly owns 43.3% of the voting equity.
|
5
|
|
Represents a joint venture company of which registrant indirectly owns 20% of the voting equity.
|
1.
|
I have reviewed this annual report on Form 10-K of Dunkin’ Brands Group, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and the other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal controls over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal controls over financial reporting, or caused such internal controls over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
February 20, 2014
|
|
/s/ Nigel Travis
|
Date
|
|
Nigel Travis
Chairman and Chief Executive Officer
|
1.
|
I have reviewed this annual report on Form 10-K of Dunkin’ Brands Group, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and the other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal controls over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal controls over financial reporting, or caused such internal controls over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
February 20, 2014
|
|
/s/ Paul Carbone
|
Date
|
|
Paul Carbone
Chief Financial Officer
|
(1)
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.
|
/s/ Nigel Travis
|
|
Nigel Travis*
Chairman and Chief Executive Officer
|
|
*
|
A signed original of this written statement required by Section 906 has been provided to Dunkin’ Brands Group, Inc. and will be retained by Dunkin’ Brands Group, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.
|
(1)
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.
|
/s/ Paul Carbone
|
|
Paul Carbone*
Chief Financial Officer
|
|
*
|
A signed original of this written statement required by Section 906 has been provided to Dunkin’ Brands Group, Inc. and will be retained by Dunkin’ Brands Group, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.
|