AUGUSTA – Talks aimed at hammering out a $2.5 million loan to reopen bankrupt Eastern Pulp and Paper Corp. stalled on one unspecified technicality Thursday afternoon.

In the meantime, the company’s workers are preparing for life after the mills just in case the facilities in Brewer and Lincoln aren’t reopened.

Eastern Pulp, which owns Eastern Fine Paper Co. in Brewer and Lincoln Pulp and Paper Co. in Lincoln, shut down its mills on Jan. 17. Only a skeleton crew is keeping the facilities warm and in startup mode.

Discussions continued through Thursday evening to work out the kink on how the loan was going to be structured, according to Jack Cashman, commissioner of the state Department of Economic and Community Development.

Loan negotiations intensified Wednesday afternoon after it was revealed that an interested buyer was meeting with several lenders in Phoenix. Last week, the lenders stipulated that before they would give the loan, they wanted to know that someone with credible financial standing was actively pursuing a buy of the mills.

The lenders got that assurance in the form of a letter and a face-to-face meeting, Cashman said. The unidentified suitor has reviewed Eastern Pulp’s finances, but hasn’t walked through the mills yet.

Eastern Pulp’s biggest lender is Congress Financial Corp. of New York City. The paper company has two loans with Congress – one is a revolving line of credit while the other is a block loan that is funded by numerous lenders. Those lenders include Congress, ING Group and Spring Street. The $2.5 million that Eastern Pulp is trying to secure would be in the form of a block loan.

Eastern Pulp has wanted to nail down emergency funding for almost a month, and announced on Jan. 9 in U.S. Bankruptcy Court in Portland that it was having difficulty paying its bills, such as suppliers’ invoices, health care premiums, and electricity and other utility charges.

The paper company’s financial difficulties have kept the company’s 750 workers on edge. Lincoln was operational until the shutdown date, excluding Christmas, but Brewer was down nine days earlier this month before the shutdown date.

Today, Eastern Pulp’s workers face the loss of a two-week grace period from looking for a job that was given to them by the state Department of Labor as part of the unemployment benefits program. There was no word Thursday evening on whether that grace period would be extended.

On Wednesday, the workers received a cancellation notice from the company’s health care provider stating that their health insurance plans would be terminated on Feb. 9.

The workers, along with elected representatives, however, are taking steps to prepare the employees for permanent job losses.

Steve Corriveau, president of PACE Local No. 10396, said Thursday evening that if the shutdown lasts 21 days, the shutdown’s temporary status automatically would be classified as a permanent one to adhere to union contracts.

“It behooves everybody to get this [loan] done,” Corriveau said. “It’s going to be a big mess if we get into that. We’re right on the edge right now.”

Corriveau said several meetings have been scheduled for next week to discuss how to apply for food stamps and medical care from the state Department of Human Services, and how to find alternative insurance plans and tackle 401(k) matters.

A representative from DHS will be at Ballard Hill School in Lincoln from 9 a.m. to 3 p.m. Tuesday and Thursday, Corriveau said. On Wednesday, alternative insurance plans and other financial matters will be discussed at 9 a.m. and 1 p.m. at the Knights of Columbus Hall in Lincoln.

On Thursday, U.S. Sen. Olympia Snowe said in a statement that the U.S. Department of Labor has certified Eastern Pulp’s workers as eligible for trade adjustment assistance starting Feb. 9.

She said part of the benefits would include a health care tax credit and an unemployment insurance extension. Plus, the program will offer job training and job search assistance. Also, she said she has contacted the Labor Department’s Employee Benefit Security Administration and the Internal Revenue Service to determine whether COBRA health benefits would be available to workers if their insurance plans were terminated.