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Lincoln Paper and Tissue Files for Bankruptcy

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Lincoln Paper and Tissue (LPT), Lincoln, Maine, USA, on Monday of this week (Sept. 28, 2015) filed a voluntary petition for bankruptcy under Chapter 11 of the U.S. Code in the U.S. Bankruptcy Court for the District of Maine. 
 
According to an article by the Bangor Daily News, Bangor, Maine, the mill has between $10 million and $50 million in both estimated debts and assets. Its largest unsecured creditor is energy company Constellation Newenergy, a Pennsylvania-based subsidiary of Exelon, to which the Lincoln mill owes just more than $1 million.
 
Eight of the company’s 20 largest unsecured creditors are based in Maine, according to the newspaper report, and are owed more than $1.2 million. They include Sibley Transportation, owed $418,194, and Woodland Pulp in Baileyville (see article below), owed $373,541. The Lincoln mill also listed $309,845 in unsecured debt to H.C. Haynes Inc. of Winn, $131,563 to Bangor Gas Co. , and $114,225 to the state for permits. It owed another four unsecured creditors based in Maine a collective $274,331.
 
 
 
LPT has negotiated Debtor in Possession (DIP) financing with Siena Lending of Stamford, Conn., that will allow ongoing normal course of business operations including payment of all post filing business expenses during the pendency of the process, according to a company release.  
 
LPT will be pursuing a sale of assets under Section 363 of the Bankruptcy Code and anticipates this process will take about 60 days.
 
In addition, a Worker Adjustment and Retraining Notice (WARN) has been provided to all employees.  The WARN Act requires employers to provide written notice of at least 60 calendar days in advance of possible plant closings and possible mass layoffs. An employer’s notice assures that assistance can be provided to affected workers, their families, and the appropriate communities through the State Rapid Response Dislocated Worker Unit
 
LPT is a supplier of specialty tissue rolls for a variety of applications including party goods, food service, medical consumables, and others. "The support of customers, suppliers, and employees during the past 11 years is most appreciated. Management and current ownership will exercise every effort to assure the best possible outcome and are hopeful that a buyer will take the business to the next level,"" the company stated. 

 

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