PORTLAND – Two Massachusetts investors want to buy bankrupt Eastern Pulp and Paper Corp.’s properties, including its mills in Brewer and Lincoln, offering a glimmer of hope to 750 displaced workers.

The $8.5 million offer isn’t solidified yet, but its terms were presented “in principle” on Monday in U.S. Bankruptcy Court in Portland. What the offer essentially did was put a halt to what was on the court’s calendar – a hearing to abandon the properties and allow creditors to sell them piecemeal.

“For better or worse, right now we have one potential buyer,” said Fred Bopp III, a Portland lawyer representing the trustee of Eastern Pulp’s bankrupt estate.

Today, the investors’ terms will be formally submitted as what’s called a “stalking horse bid.” Other companies interested in purchasing Eastern Pulp will have to beat those terms in order to be successful during a court-sponsored auction, tentatively planned for early March.

The auction date will become firm today.

Monday’s court proceedings took on the tone of a “save-us-from-going-out-of-business sale,” and the investors, Satish Agrawal of Concord, Mass., and Robb Osinski of Salisbury, Mass., bargained a rock-bottom price.

As low as the $8.5 million offer may seem, it was all that could be negotiated in less than three weeks, according to attorneys close to the loan discussions who acknowledged that even if more time was available the same price may have been the end result.

Eastern Pulp, which owned Lincoln Pulp and Paper Co. in Lincoln and Eastern Fine Paper Co. in Brewer, ceased to exist on Feb. 4 when its bankruptcy status was converted to Chapter 7, or liquidation, from Chapter 11, or protection from creditors. Eastern Pulp filed for bankruptcy in September 2000.

Since Feb. 4, at least 10 interested buyers, some described just as “tire kickers,” toured the mills. But the Massachusetts investors’ offer was considered the best because the buyers would be paying cash instead of needing to borrow money to cover the purchase price, and their terms could be approved as a “stalking horse” bid by U.S. Bankruptcy Chief Judge James B. Haines.

Not everyone is happy with the offer, including Cianbro Corp., which is owed about $3 million by Eastern Pulp. The Pittsfield-based construction company would lose its money, as would most of Eastern Pulp’s other secured creditors, who are owed $44 million, and its unsecured creditors, who are owed nearly $40 million.

The mills’ personal property and real estate are assessed at $103 million, according to the towns of Brewer and Lincoln. The Lincoln mill accounts for 31 percent of the town’s tax base, while the Brewer mill accounts for 4 percent of the city’s tax base.

Haines, when notified that some of the secured creditors may object to the $8.5 million offer today, said the only other alternative in front of him is to abandon the mills, and that could still happen today if all of the secured creditors don’t consent in writing to the investors’ bid.

“I know that all of you in the trenches did a lot of hard work … and that all of you might not go home happy,” Haines said to those in court.

The trustee, Bangor lawyer Gary Growe, said after court adjourned that the secured creditors’ issues “are resolvable.” He was not, however, ready to say that the auction is under way.

“Deals have been broken over less,” Growe said. “It’s not time to declare victory.”

Agrawal, a former vice president and chief technical officer of Polaroid Corp., and Osinski, an entrepreneur and former mortgage officer, were not present in bankruptcy court Monday. Their attorney, John Sigel, said he could not comment on the offer.

Bopp, representing the trustee, said that because of the position the estate is in, the offer “simply won’t be enough to pay all the liens in full.”

The mills have been in “warm stasis” mode, or kept warm and maintained by a skeleton crew, since Feb. 4. For the last couple of weeks, Growe has been borrowing money from Eastern Pulp’s secured lenders to pay for heating oil, electricity, wastewater treatment and wages. But that money was to run out Monday, and lenders gave an undisclosed amount to keep “warm stasis” continuing through Wednesday.

According to Bopp, about $1 million from the sales proceeds would be used to continue to keep the mills warm until the sale is completed. Another $1 million would be available if necessary from the Finance Authority of Maine, but that would have to be paid back from proceeds of the sale.

Congress Financial Corp. of New York City would receive $500,000 from the purchase price to sell all rights to Eastern Pulp’s intellectual property, such as patented and patent-pending design processes and products, along with other materials, to the investors. Last week, Congress Financial received approval from Haines to sell the materials and the intellectual property.

Besides purchasing the intellectual property rights, the investors would assume the mortgage on Eastern Pulp’s headquarters in Amherst, Mass. The mortgage amount was not available.

How the remainder of the sales proceeds, up to $5 million, would be divvied up was not disclosed Monday. One lender, Corsair Special Situations Fund LLP, is owed $3 million. The towns of Lincoln and Brewer are owed about $1 million in taxes, and lenders Congress Financial and ING Group collectively are owed $40 million. Cianbro is owed up to $3 million.

“That remains for another day,” Growe said.

The intellectual property rights are viewed as the future of the mills, according to a source close to the negotiations who asked not to be identified. Agrawal already has his name on two of Eastern’s patent-pending processes that would be used to produce papers for digital imaging equipment, and once those patents are approved, he wants to implement them at the mills.

According to the source, the investors plan to reopen Lincoln soon after the sale is completed, which should take two months, and to evaluate when Brewer would reopen. Between 300 and 500 people would return to work, the source said.

Gov. John Baldacci, who talked to the prospective buyers a couple of weeks ago, said Monday that the application of new technologies into the mills would help the state’s paper industry become a player on the worldwide stage again. He said the new products would allow the company “to get in on the front end and not the back end” of emerging technologies and sales.

“That’s how they’re going to be successful,” Baldacci said. “There’s a real opportunity here.”

Jonathan Beal, an attorney for the mills’ PACE unions, said that the offer restores hope for Eastern Pulp’s workers who for more than a week watched as abandonment inched closer to reality.

“We’re very pleased that the abandonment has been postponed, possibly forever,” Beal said. “The idea of them using the [patents] and developing new grades is tremendously optimistic.”