The closure of the family- run business cost nearly 30 people their jobs.
KINGFIELD – An H.G. Winter & Sons attorney sent out notices Tuesday to creditors notifying them that there isn’t enough money to pay them.
The company received no money at the closing when it sold the company to Jordan Lumber Co., the attorney informed creditors.
The entire proceeds of the sale was used to pay environmental fees, property taxes, secured bank loans, fees for a broker, legal and accounting fees, according to the letter from company attorney Michael J. Pearce of Portland.
As a result, the company is now in the “unfortunate position of having to report that there are no monies available for payments to creditors.”
Among the creditors writing off bills owed by H.G. Winter was the Kingfield Water District. The company owed $2,500 to the district, said Selectman John Dill, who is the Water District treasurer.
H.G. Winter & Sons sold the property to Jordan Lumber Co. last September. The wood-turning business had shut its doors in January 2003, citing spiraling costs for fuel, insurance and other expenses along with unrelenting price pressure attributable, in part, to foreign competition.
Company Chief Executive Officer Tyler Winter and other family members tried to cover losses with cash infusions and locate new customers but efforts were unsuccessful.
Nearly 30 employees lost their jobs.
Circumstances changed
According to the creditors’ letter sent out by Pearce, the company agreed to sell all of its real estate, machinery and equipment to Jordan Lumber for $195,000.
At the time the price was agreed to, it appeared there would be money available for creditors, the letter stated.
However, due to the company’s long use of varnishes, enamels, and other hazardous and toxic substances; the substantial amount of asbestos throughout several buildings; and an open dump site, the Maine Department of Environmental Protection would not allow a sale until the site met DEP standards.
That required several layers of investigation, interviews and environmental testing. The company hired an environmental consulting firm to do the work.
The “environmental consultants, accruals of interest on secured debt and property taxes, accruals of significant additional property taxes, additional attorneys fees to deal with all of the issues, and the additional general overhead for such things as the telephone, electricity, heat and the like,” were cited by Pearce.
“In fact prior to closing, things were so tight that the company had to request the buyer’s permission to spend the real estate deposit to pay these expenses. The company’s insurance also expired, and there was no money to renew it,” the letter stated.
The entire process has been “very painful for the Winter family, which had to watch a business that had been owned by the family for three generations be liquidated for little or no value,” the letter stated.
Attempts to reach Pearce and Tyler Winter were unsuccessful Thursday.
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