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Rugby Estates Plc 

('Rugby' / the 'Company')

 17 February 2009

RUGBY ASSET MANAGEMENT AGREES NEW FEE ARRANGEMENTS WITH O TWELVE ESTATES

Rugby Asset Management Limited ('RAM'), a wholly owned subsidiary of Rugby Estates Plc, today announces a number of changes to the terms of its Property Adviser agreement ('PAA') with O Twelve Estates Limited ('O Twelve').

The following principal changes in the terms of the PAA have been agreed:

• The annual management fee will be reduced from 1.0% of O Twelve's gross property asset value to 0.6% with effect from 1 April 2009. The annual management fee remains subject to a minimum annual fee of £250,000 and is payable quarterly in arrears.

• Any performance fees which may become due to RAM will be calculated on the basis of O Twelve's performance after 31 March 2009, at which date O Twelve's net assets per share are deemed to be 50p and from which the performance benchmarks will be based. The most recent published net assets per share of O Twelve were 55.55p, calculated as at 30 September 2008. Given continuing falls in the value of UK properties, a lower figure is expected to be reported as at 31 March 2009. No performance fees will be due to RAM for the period before 1 April 2009.

• At the option of O Twelve, any performance fee payable to RAM may be settled by the issue of ordinary shares in O Twelve instead of cash.  The number of any such shares to be issued shall be equal to the amount of the performance fee divided by the average mid-market value of an ordinary share for the five business days immediately preceding the date of issue. O Twelve may require RAM to undertake not to dispose of any such shares for a period of up to 12 months.

• O Twelve will not exercise its right to terminate the PAA as a result of O Twelve failing to achieve the specified minimum performance target of 5% per annum growth in net assets per share (with dividends added back) for the period from O Twelve's admission to AIM to 31 March 2009.

• O Twelve will have the right to terminate the PAA if growth in net assets per share (with dividends added back) for the three years ending 31 March 2012 is less than 5% per annum and net assets per share as at 31 March 2009 are deemed to be 50p for this purpose. 

All other principal terms of the PAA remain the same. RAM was appointed Property Adviser to O Twelve at the company's admission to AIM in March 2006 for a fixed initial period of eight years terminable on two years' written notice. 

David Tye, chairman of Rugby Estates, said:

'Against the backdrop of the ongoing financial crisis, these new fee arrangements will continue to provide RAM with an important income stream. Whilst it will reduce the property management fees by approximately £900,000 per annum based on the valuation of O Twelve's property portfolio as at 30 September 2008, it provides RAM with new opportunities to generate performance fees from the portfolio, as we strive to create value in the current market and position the portfolio for future growth.'

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For further information please contact:

Rugby Asset Management Ltd                                 +44 (0) 20 7016 0050 

David Tye

Andrew Wilson

Financial Dynamics (for Rugby Estates Plc)            +44 (0) 20 7831 3113

Dido Laurimore
Rachel Drysdale
Laurence Jones

Fairfax I.S. plc                                                             +44 (0) 20 7598 5368

Simon Bennett

Jeremy Porter

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