Dippin' Dots files for Bankruptcy

Dippin' Dots has filed for Bankruptcy just days before the IAAPA expo.



Dippin' Dots is seeking federal bankruptcy protection, a move the company said is aimed at staving off foreclosure on more than $11 million in loans.

Once the self-proclaimed "Ice Cream of the Future," Dippin' Dots is seeking federal bankruptcy protection, a move the company said is aimed at staving off foreclosure on more than $11 million in loans.

The Paducah, Ky.-based company filed for Chapter 11 reorganization Thursday night, asking U.S. Bankruptcy Judge Thomas H. Fulton to allow it to use cash collateral to continue operations while the case plays out. The company said in a filing that allowing it to use the cash collateral and stay functioning will not harm creditors, including its largest single creditor, Regions Bank, which is owed $11.1 million.

Alabama-based Regions Bank sued Dippin' Dots in February, alleging the company defaulted on multiple loans. The suit is pending in McCracken County Circuit Court.

Steve Heisner, director of administration for Dippin' Dots, said Regions gave the company 48-hours' notice that it intended to foreclose on the loans. That move forced Dippin' Dots Inc., to file for bankruptcy while looking to refinance the debt, Heisner said.

"We are hopeful and believe we will be successful," Heisner told The Associated Press. "There is no thought, intent ... that our operations will be significantly different than they are today."

The company "has no alternative borrowing source and to remain in business, the (company) must be permitted to use the cash proceeds described herein to pay general operating overhead and administrative expenses," its attorneys said in court documents.

Heisner said the bankruptcy affects only the manufacturing and national sales arm of the company. The franchise end of the company will not be affected by the proceedings, he said.

"The dot, it's going to be there," Heisner said. "There's no doubt about it."

A Regions Bank spokesman declined to comment Friday afternoon.

Heisner said when the economy soured in the fall of 2008, Dippin' Dots, like many businesses took a hit.

"It was just a difficult economic time," Heisner said. "That's the only way I know how to express it."

Dippin' Dots, which sells cryogenically frozen beads of ice cream, markets itself to stores, as well as a number of amusement parks across the country, theaters and malls.

In the bankruptcy filing, the company listed about $20.2 million in assets and more than $12 million in liabilities. Dippin' Dots listed $27.7 million in income through September, $26.7 million in income in 2010 and $33.8 million in 2009.

Curt Jones, a microbiology graduate of Southern Illinois University in Carbondale who now lives in Nashville, Tenn., created the ice cream beads in 1988. After having to sell a car and raid savings to keep going, he grew the business to nearly 2,000 locations across the country, from mall kiosks to amusement parks and stadiums. The ice cream is stored at 40 degrees below zero and sold at 20 below zero.

Jones, who dubbed Dippin' Dots the "Ice Cream of the Future," resumed daily control of the company in 2009, with the aim of restructuring it to maintain profits even if sales dropped. In making the move, Jones dismissed President Tom Leonard and Operations Vice President Dominic Fontana. Leonard had run luggage maker Samsonite before joining the company.

The company had made no mention of the bankruptcy on its website or Facebook page as of Friday afternoon.

Read more: http://www.nydailynews.com/life-style/e ... z1d8soJ5VW

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Thoughts? Personally I hated the one Dippin' Dots I had so I will not miss them if they indeed go under.

I loved DD...especially Cookies & Cream.

Man that sucks. Now what will they call the little stand at Hersheypark?

NOOOOO PLEASE GOD =[

Well I thought they were delicious but always painfully over-expensive lol

Where will we get all the details on new rides now?

I love dip'n'dots, the Birthday cake flavor dip'n'dots after a well ride on Diamondback.

[Coasterkidmwm]

Now what will the fatties eat?

All they would have to do to make a poop ton of cash is make that poop publicly available everywhere. Hell if I could buy them at a local grocery store I'd be getting me some dip'n'dots all the time!

Originally posted by Freddie

Where will we get all the details on new rides now?

This.

If dippin' dots are the "Ice Cream of the future" then in the future there probably won't be ice cream.

Read the article, it's chapter 11 and all dippin dots stands will remain open; the bankruptcy only affects the sales and marketing departments.

:)

happy now i am

[SauronHimself]

Mrfeeny makes a good point. Had Dippin' Dots marketed their product to more places than just theme parks, they probably would not be in this mess. I think an idiot could figure out that you're doomed for failure when you sell a product in one type of location at astronomical prices. I realize that all food prices are highly elevated at theme parks, and whether or not they're reflective of the operating costs of the park is something of which I cannot be sure, but the point is that Dippin' Dots would certainly make more money if it broadened its horizons.

Maybe if Dippin Dots didnt also have INSANE price points this wouldnt be as much of an issue as well. Its great to make a large profit but at the expense of volume?

My local store has knock off ones in the same sizes but for a fraction of the cost. I think the small is $1 and the larger one is like $2. Tastes EXACTLY the same.


ALso if we compare to say, Pepsi, its normally sold in stores here for around 1.50 per 20oz. At Cedar Point? 3. So its 100% markup. IF thats the case for the Dippin Dots, it should sell a large in a supermarket for around 250-3.


It just didnt make sense in the long run. The whole "Ice Cream of the future" thing worked for about 2-3 years. Then it got old hat.

I like Dippin' Dots, but they're just wayyy too expensive.