AF&Y Shuts Down Operations

Chapel Hill, N.C.-based American Fibers & Yarns Co. (AF&Y) has discontinued operations and
closed its two plants in Bainbridge, Ga., and Afton, Va., and plans to liquidate its assets under
Chapter 11 bankruptcy protection. Including manufacturing and corporate employees, approximately
330 people have lost their jobs.

The company was a major supplier of solution-dyed polypropylene filament yarns for
residential and contract furnishings fabrics as well as a supplier of product for industrial,
automotive and apparel applications. Its Marquesa® and Innova® yarns offered earth-friendly,
inherent performance attributes, and AF&Y had initiated a program for recycling fabrics made
with its yarns.

AF&Y cited increased offshore residential upholstery fabrics sourcing, high polypropylene
resin prices, competition from polyester producers, price pressure from lower-cost imported
textiles and the current economic decline as factors leading to the shutdown. The company also had
been unable to secure additional financing or sell portions of the business.

RAS Management Advisors LLC, Newport, R.I., is assisting AF&Y in its efforts to wind down
the business and settle its affairs.

Remarking on the cost increases for polypropylene resin and competition from polyester-based
products, Timothy Boates, president, RAS, said: “For a long time, there was a real value
differential that AF&Y benefited from, where its products were cheaper than polyester-based
products, but the price of raw materials has gone up so sharply over the last couple of years that
that price advantage has turned the other way around. Right now, there’s a substantial negative
price variance between our product and polyester-based product.”

November/December 2008