Sandy-based baby-photo Kiddie Kandids shutting doors

Kristen Turner was looking forward to Monday, day one of her promotion to manager of a Murray Kiddie Kandids studio. Instead, a few minutes after midnight, she was told the company was folding, effective immediately.

And the news throughout the day kept getting worse: Along with a couple thousand employees of the Sandy-based baby-photo business, she's out of work, may not be paid for the past two weeks' labor and no longer has health insurance or access to a COBRA policy, either.

The company confirmed the closure in a two-paragraph statement faxed to newsrooms Monday afternoon, blaming "negative growth" on the economy and a decision by lenders to "no longer fund Kiddie Kandids' operations." The company said it plans to file for Chapter 7 bankruptcy this week.

The 35-year-old chain has 184 locations, including at least a dozen between Provo and Ogden. Most of the nationwide locations are at Babies"R"Us stores.

Company officials did not return calls from the Deseret News, and there's no word on what will happen to customers' special orders.

According to information on a blog set up for employees: "Because of the unforeseen termination of funding by the lenders, there is no money to pay payroll (both past and future), there is no money to reimburse expenses, and there is no money to pay our suppliers. … We regret to inform you there is no money to pay health-related bills from the company's self-insured plan, thus you do not have health insurance. There are no COBRA programs available from defunct plans such as ours, either."

"We don't even know if insurance claims from the past week or so are covered," Turner said.

"I did not see this one coming at all," said Matt Birch, who had been the company spokesman. "I found out last night in a phone call, and they told me almost nothing."

"It was last minute, with no heads-up at all, and we're upset," said Deborah Stanford, an employee who gathered with others at the Valley Fair Mall studio Monday morning, where one described them all as "shell-shocked."

Turner said her district manager called at 10:30 p.m. Sunday and told her all the stores would be closed Monday. She said she asked if she should be worried, but was told it was just for the day. She and another manager reached a corporate trainer who said the company was filing for bankruptcy and closing permanently. "We were told it would only reopen if someone wants to buy it and make good on all the debt."