ShoreTrips sale proposed, but with no protection for millions in client deposits and credits

The court-appointed receiver of cruise excursion operator ShoreTrips has accepted an offer to sell the company’s assets for $375,000 — free and clear of debts that include nearly $5 million in customer deposits and payments —  to an unnamed Florida-based limited liability company.

According to a notice from the court-appointed receiver, Milwaukee attorney Seth Dizard, the agreement means the unnamed buyer “is not assuming any obligations of ShoreTrips to refund deposits or to honor coupons that were issued to customers by ShoreTrips prior to the receivership.”

A Zoom hearing on whether to approve the sale has been scheduled for Feb. 23 before Milwaukee County Circuit Court Judge Timothy Witkowiak. Written objections must  be filed with the court by Feb. 19.

ShoreTrips owners Barry and Julie Karp had filed for protection from creditors in November in what is the Wisconsin state alternative to federal bankruptcy protection. In a statement after the filing, Barry Karp said the “business became a situation that was untenable” because of the pandemic.

But Carolyn Sandgren, president of Elite Travel in in Cape Girardeau, Mo., blasted the Karps for blaming the pandemic and questioned where the millions in traveler payments went.

“I believe every agent and client is asking the same question,” she said in an email to Travel Weekly. “I still can’t figure out why no one is asking where the [millions that] clients paid and is outstanding [or] in useless vouchers. Covid19 didn’t spend this money. What a boatload of money of client funds! Imagine the damage this does to the reputation of advisors who recommended them [instead of] the safety net of cruise line excursions.”

Karp did not immediately respond Friday to an email request for comment on the sale, or whether he and his wife still hope to be involved in the company going forward, as he had indicated in his initial statement about the filing.

According to court filings, the Milwaukee-based company’s liabilities included $4.76 million in customer deposits for trips that have been canceled. Additionally, the company owes $974,324 in accounts payable and $345,000 in long-term debt but had just over $100,000 in cash.

ShoreTrips is one of the country’s largest independent providers of commissionable shore excursions.

Background information that was circulated by Dizard in his request for bids said ShoreTrips was founded in 2001 by the Karps to offer an “an alternative to the crowded coaches and highly commercialized destinations typical of shore excursions offered by cruise lines.”

Over the years, the document said, the company has developed an extensive network of more than 2,000 local guides and tour operators in more than 450 destinations around the world.

At its peak in 2019, the company had approximately 20 employees and generated gross revenue in excess of $22 million.