Central GoldTrust

Central GoldTrust

May 06, 2009 09:17 ET

Central GoldTrust Enters Into U.S. $175 Million Underwriting Agreement

TORONTO, ONTARIO--(Marketwire - May 6, 2009) - Central GoldTrust (TSX:GTU.UN)(TSX:GTU.U)(NYSE Amex:GTU) of Ancaster, Ontario announced today that it has entered into an underwriting agreement with CIBC, as underwriter, under which the underwriter has agreed to buy and sell to the public in Canada (except Quebec) and the United States under the multijurisdictional disclosure system, 4,825,000 Units of Central GoldTrust. The Underwriter has been granted the right to increase the size of the offering (the "Right") by up to an additional 690,000 Units, exercisable in whole or in part, at any point prior to 4:00 p.m. (EST) on May 6, 2009. The offering will be made under a second prospectus supplement to Central GoldTrust's U.S.$250,000,000 base shelf prospectus dated December 19, 2008.

The purchase price of U.S.$36.30 per Unit is expected to result in gross proceeds of U.S.$175,147,500, prior to the exercise of the Right. Substantially all the net proceeds of the offering have been committed to purchase gold bullion for settlement at closing, in keeping with the asset allocation provisions outlined in Central GoldTrust's Declaration of Trust and the related policies established by its Board of Trustees. Any additional capital raised by the offering is expected to assist in reducing the annual expense ratio in favour of the Unitholders of Central GoldTrust.

Closing is expected to occur on or about May 12, 2009.

Central GoldTrust has filed a base shelf prospectus and registration statement with the Canadian securities regulatory authorities (except Quebec) and the United States Securities and Exchange Commission ("SEC") for the offering to which this communication relates. Before you invest, you should read the base shelf prospectus and prospectus supplement and any other documents Central GoldTrust has filed with the securities commissions in each of the provinces and territories of Canada, except Quebec, and the SEC for more complete information about Central GoldTrust and this offering. You may obtain a copy of the base shelf prospectus and prospectus supplement filed in the United States from CIBC World Markets Corp. 425 Lexington Avenue, 5th Floor, New York, New York, 10017, by fax at 212-667-6303 or by e-mail at useprospectus@us.cibc.com. You may obtain a copy of the base shelf prospectus and prospectus supplement filed in Canada from CIBC, fax 416-594-7242 or request a copy by telephone at 416-594-7270.

Statements contained in this release that are not historical facts are forward-looking statements that involve risks and uncertainties. Central GoldTrust's actual results could differ materially from those expressed or implied by such forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those risks detailed in Central GoldTrust's filings with the Canadian securities regulatory authorities and the SEC.

Central GoldTrust, founded in April 2003, is a passive, self-governing, single purpose, closed-end trust, which holds approximately 98% of its net assets in unencumbered, long-term holdings of gold bullion, in physical international bars and in certificate form. Central GoldTrust does not actively speculate with regard to short-term changes in gold prices. Central GoldTrust's gold bullion is held unencumbered in allocated, segregated and insured safekeeping in Canada, in the treasury vaults of the Canadian Imperial Bank of Commerce. The gold bullion is physically inspected by Ernst & Young LLP in the presence of Central GoldTrust's Officers and Trustees as well as bank officials. Central GoldTrust Units are quoted on the NYSE Amex, symbol GTU and the TSX, symbols GTU.UN (Cdn. $) and GTU.U (U.S. $).

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