#!/usr/bin/perl
local $/;
open my $fh, '<', 'C:/Users/bwinkley/Desktop/test/whitespace.txt' or die $!;
my $txt = <$fh>;

#$txt =~ s/(\n\|)/ /mg;
$txt =~ s/\R\|/ /mg;

for ( split '\n', $txt ) {
    # process each line
}
print $txt;