Eastern pursues loan, obtains EPA decision

BANGOR – Bankrupt Eastern Pulp and Paper Corp. postponed two scheduled court hearings Friday, when terms of a $2 million loan were to be presented for approval by a federal bankruptcy judge.

The company has scheduled another hearing for 9 a.m. Monday, and an attorney for the papermaker said Friday afternoon that the loan package would be ready by then.

Eastern also got news Friday that the Environmental Protection Agency had decided not to add the papermaker’s Lincoln mill to the National Priority List under the Superfund program. According to members of Maine’s congressional delegation, this should make it easier for Eastern to emerge from bankruptcy.

“We’ll have a document ready for the judge to sign [Monday],” said George Marcus, a Portland lawyer representing Eastern Pulp.

Eastern Pulp was to present the loan during a 9 a.m. hearing Friday after not being able to complete the document before two scheduled hearings on Thursday. The 9 a.m. Friday hearing was postponed until 4 p.m., and then rescheduled for Monday.

Marcus said the objections from creditors about whether the entire loan amount was necessary and whether the company should be taking on any more debt had been satisfied.

“Nobody’s saying don’t do the deal,” Marcus said.

The $2 million loan, at 15.45 percent interest, will be used to finance routine, scheduled maintenance at Eastern Pulp’s two mills in Lincoln and Brewer. Work is scheduled to begin Sept. 1.

On Monday, Eastern Pulp was to be in bankruptcy court to discuss its disclosure statement on the company’s plan to emerge from Chapter 11 bankruptcy protection by the fourth quarter of this year. The disclosure statement is sent to the papermaker’s creditors.

That hearing has been postponed until Sept. 19, Marcus said.