Correction; AGM and Proposed Amendments to IAA

Further to the announcement by Ludgate Environmental Fund Limited released at 7:00 a.m. on 5 December 2012 under RNS number 7383S (the "Prior Announcement") regarding its annual general meeting and the resolution for shareholders to approve proposed changes to the Investment Advisory Agreement ("IAA") with Ludgate Investments Limited (the "Adviser"), the Company wishes to correct an error in the summary of the proposed basic advisory fee to be paid to the Adviser under the terms of the amended IAA.

The fourth paragraph of the Prior Announcement should have read as follows:

"Currently, the Adviser is entitled to receive a basic advisory fee of 2 per cent. of the Company's NAV per annum. Under the terms of the amended IAA, the Adviser will be entitled to receive a basic advisory fee, payable quarterly, of 2 per cent. of NAV per annum, adding back only for these purposes any distributions or dividends paid to shareholders since 30 June 2012."

In all other respects the Prior Announcement remains unchanged. The full amended text is shown below.

The Company will issue a hard copy correction notice to shareholders who received a hard copy of the notice of annual general meeting.

Ludgate Environmental Fund Limited (the "Company")Notice of AGM and Proposed Amendments to Investment Advisory Agreement

Ludgate Environmental Fund Limited announces that the Annual General Meeting ("AGM") of the Company will be held on 21 December 2012 at 10 a.m. at Lime Grove House, Green Street, St Helier, Jersey, JE1 2ST, Channel Islands.

The notice of AGM has been posted to shareholders and an electronic copy is available on the Company's website at www.ludgateenvironmental.com.

Further to the Company's final results announcement on 12 September 2012, the notice of AGM includes a resolution for shareholders to approve proposed amendments to the existing investment advisory agreement ("IAA") between the Company and its investment adviser, Ludgate Investments Limited (the "Adviser"). These amendments are being proposed (inter alia) with the object of ensuring that the Adviser is appropriately incentivised to realise assets in timely manner prior to the end of the Company's life whilst maximising value.

Currently, the Adviser is entitled to receive a basic advisory fee of 2 per cent. of the Company's NAV per annum. Under the terms of the amended IAA, the Adviser will be entitled to receive a basic advisory fee, payable quarterly, of 2 per cent. of NAV per annum, adding back only for these purposes any distributions or dividends paid to shareholders since 30 June 2012.

The Adviser is also currently entitled, subject to certain conditions, to receive a performance fee of 20 per cent of any increase in NAV in excess of an 8 per cent. compound per annum hurdle rate since the Company's admission to AIM. Under the proposed amended terms, the Adviser will be entitled to receive an annual performance fee of 20 per cent of any increase in the Company's NAV since 30 June 2012 (adding back any distributions or dividends paid to shareholders during the relevant annual performance fee period) in excess of an 8 per cent. compound per annum hurdle rate. Additionally, a proportion of any such performance fee that would otherwise be payable on an ongoing basis will be retained until certain targets concerning the realisation of the Company's assets are met.

Under the amended IAA, the Company and the Adviser may terminate the IAA by giving twelve months' notice at any point from 1 July 2013 (so that the earliest effective termination date would be 30 June 2014). Currently, either party may terminate on twelve months' notice with such notice being given at any time.

Further information regarding the proposed changes to the IAA are set out in the notice of AGM.

Pursuant to the AIM Rules, the Adviser is a related party of the Company and, as such, the proposed amendments to the IAA are considered a related party transaction. The directors consider, having consulted with the Company's nominated adviser, that the terms of the transaction are fair and reasonable insofar as the Company's shareholders are concerned.

7 December 2012

For further information contact:

Ludgate Environmental Fund Limited +44 (0) 1534 609034

John Shakeshaft, Chairman

Ludgate Investments Limited +44 (0) 20 7621 5770

Bill Weil

PricewaterhouseCoopers LLP (Nomad) +44 (0) 20 7212 1798

Chris Clarke

Panmure Gordon (Broker) +44 (0) 20 7866 2713

Paul Fincham