Red Shield bankruptcy hearing postponed again

By Jessica Bloch, BDN Staff
Posted Sept. 12, 2008, at 9:03 p.m.

OLD TOWN, Maine — A bankruptcy hearing for Red Shield Environmental LLC has been postponed for a third time.

The hearing, which had been rescheduled for Monday, Sept. 15, in Bangor, now will take place at 10 a.m. Tuesday, Sept. 23, in Portland. U.S. Bankruptcy Court Judge Leron H. Kornreich approved the post-ponement Friday.

The hearing will determine whether Red Shield and its subsidiary RSE Pulp & Chemical LLC will be approved for $13.6 million in funding to restart the Old Town facility, which has been idle since Red Shield filed for bankruptcy in June.

The proposed lender is Woodside Capital of Burlington, Vt.

Red Shield chief executive officer Ed Paslawski said the company needs another week to complete the deal with the Finance Authority of Maine.

“We’ve been working with FAME, and we think we finally reached agreement, but won’t have all the details worked out so we’ve had to push it back,” he said Friday.

That was the reason for the second postponement for a hearing that was supposed to have been held Sept. 2, Red Shield attorney Bob Keach said at the time.

The first hearing was scheduled for Aug. 20.

Since filing for Chapter 11 protection, Red Shield has borrowed about $2 million to keep the facility idle.

Paslawski said the most recent loan of $550,000 would keep the facility going through the end of the month.

About 160 employees were laid off, while some remain to maintain the facility, which is on the site of the former Geor-gia-Pacific mill.

“We stay in constant contact through our people at the plant,” Paslawski said. “It’s all at least positive. We’re happy that it’s the way it is.”

http://bangordailynews.com/2008/09/12/business/red-shield-bankruptcy-hearing-postponed-again/ printed on July 31, 2014