i wuz wrong, page-4

What were they doing raising capital from these two? And with covenants like that? - Share price to remain above a level, MD to stay in place, and right to demand immediate repayment of the first tranche of debt notes. That MD was a real winner for Goldstar wasn't he? Real responsible guy. Came close to buying some of these many times.

The Age - business section

Goldstar investor calls in administrators
Jamie Freed
January 9, 2009 - 10:40AM

"The major shareholder of Victorian gold hopeful Goldstar Resources last night called in administrators after refusing to advance $1.6 million to the explorer despite a previous agreement.

Goldstar's chairman, Gordon Hill, said Silja Investments exercised "get-out'' clauses linked to the explorer's depressed share price and the recent resignation of its managing director to avoid handing over the second tranche of a $3 million convertible note.

It also asked Goldstar to immediately return the $1.4 million first tranche released last year, which the cash-strapped miner was unable to do without a capital raising.

Mr Hill said Silja called in the administrators without giving Goldstar time to explore alternatives.

Goldstar had been attempting to resurrect the historic Walhalla goldfield.

Silja, controlled by an overseas mother-and-son investor team, will likely rank as the company's top creditor.

Mr Hill said Goldstar's board had planned to announce a rights issue after a meeting scheduled for next Monday.

He said he hoped the administrators would work with shareholders to attempt some a fundraising which would see the company return to trading, and added he would personally invest "a lot of money'' into such a capital raising.

"It is early days,'' Mr Hill said. "Hopefully something can be achieved out of it.''

The administrators at PPB were unavailable for comment last night."