San Francisco-based GAP Inc.’s Board of Directors and Paul Pressler have announced that Pressler
has resigned from his position as president and CEO, and his seat on the board. Robert J. Fisher,
non-executive chairman of the board, now serves as president and CEO on an interim basis. A search
committee has been formed by the board to find a new CEO.

“During this important transition period for our company, the board of directors and I are
committed to working with our employees to enhance our focus on what has been at the heart of the
company’s past success, reinvigorating our brands and charting a new course for the future that
will deliver strong returns for shareholders” said Fisher.

January 24, 2007

The National Council of Textile Organizations (NCTO) has urged extension of the countervailing duty
law to non-market economies, such as China, charging that failure to impose such duties harms the
US textile industry. At the present time, the US Department of Commerce (DOC) has held, for a
number of reasons, that companies may not seek redress from imports from non-market economies for
what the say are unfair trade practices.

Appeals for a change by the department were triggered by an action in December, when DOC
officials agreed to look at a petition from a paper company asking for countervailing duties to be
applied to Chinese imports. The DOC has accepted the petition and has called for comments from
interested parties. If the petition is approved after public comments are reviewed, the DOC would
conduct a full-scale investigation into whether countervailing duties may be justified.

Charging that imports from China cause more harm and cost the industry more jobs than do
imports from any other country, NCTO President Cass Johnson, in a letter to the DOC, said the
department should overturn its “indefensible” policy and show leadership in defending laws designed
to prevent unfair trade practices.

In the past, the DOC has contended it cannot “unpeel subsidies” from non-market economies,
and as a result it has been unable to take countervailing duty actions against them.

“Subsidies are created to give real and tangible benefits to industries, and it seems amazing
that the United States government actually contends that it cannot arrive at a defensible
estimation of how much of a benefit a particular subsidy may deliver,” said Johnson. “The fact that
every other developed country says that they can unpeel these subsidies from non-market economies
makes such a stand indefensible.”

Johnson said China’s commitment to full and open disclosure as a member of the World Trade
Organization further weakens the US government’s position. “If China is not disclosing its
subsidies as most experts agree,” he said, “ the US government should discover them through an
intensive examination of Chinese policies.”

The US textile industry contends that China is subsidizing its exports with government
grants, low interest rates, currency manipulation, preferential tax rates and subsidized raw
materials.

January 24, 2007

Sen. Elizabeth Dole, R-N.C., and Rep. Robin Hayes, R-N.C., have reintroduced bills to restore the
rank of “ambassador” to the Office of the US Trade Representative’s special textile and apparel
negotiator. Until 2003, the position carried the title of chief textile negotiator, a title that
carried the rank of ambassador and required Senate confirmation.

If passed, the bill would restore the rank of ambassador. Without that rank, the current
negotiator has been put on unequal footing with some international counterparts.

“America’s domestic textile industry should have every advantage that other countries enjoy
when it comes to USTR negotiations with foreign counterparts,” Hayes said. “We will continue to
push for comprehensive agreements that prevent countries, including China, from dumping illegal
transshipments into our market, and I want to empower the USTR textile negotiator to protect
American textile jobs.”

The bill also would allow the negotiator to serve as acting chief textile negotiator until
Senate confirmation.

January 24, 2007

Armstrong will retain ownership of Desseaux businesses related to linoleum-based indoor
sports flooring and automotive carpeting.

January 16, 2007

Matt Priest, a former legislative aide to Rep Sue Myrick, R-N.C., who has considerable experience
dealing with trade issues, has been named Deputy Assistant Secretary for Textiles and Apparel at
the Department of Commerce’s Office of Textiles and Apparel (OTEXA). In that position, Priest will
be the point man for carrying out the US government’s textile trade programs. He succeeds James C.
Leonard, who left that post in September 2006.

In addition to playing a role in developing trade policies, Priest will serve as chairman of
the Committee for the Implementation of Textile Agreements (CITA), an interagency committee charged
with monitoring and implementing textile and apparel trade agreements. The assistant secretary also
performs research and analyses, compiles industry data and promotes US trade events involving
textiles and apparel.

In announcing the appointment, Commerce Under Secretary for International Trade Frank Lavin
said: “Matt Priest provides sound advice and key insight regarding textile and apparel issues and
is a welcome addition to OTEXA. His knowledge of trade issues and industry concerns will offer a
smooth transition so we can continue to work on behalf of the textile and apparel industries.”

Priest has been serving as a senior advisor to the Assistant Secretary for Import
Administration at the Commerce Department, a position held currently held by David Spooner, a
former textile negotiator in the Office of the US Trade Representative. As a former legislative
director for Rep. Myrick, Priest was an advisor in the areas of textiles, trade and economic
development.”

One of Priest’s most important initial tasks will be the development of procedures for
enforcing the administration’s commitment to monitor Vietnam trade, in order to ensure that there
are no unfair trade practices when import quotas are removed.

January 16, 2007

According to Delores Sides, director, corporate communications and human resources, ITG, the
transition of the product line from Burlington House to Culp will take two to four months. The
exact impact on Burlington House employees isn’t yet clear, although Sides said there will be a
reevaluation of capacity needs going forward at the company’s Pioneer operation. “We do not expect
significant change at our Burlington Finishing plant, as we are in the process of moving apparel
fabrics into that plant, which we expect to balance our employment needs,” she added.

January 16, 2007

The Netherlands-based TenCate — a global manufacturer of such technical textiles as synthetic
grass, protective fabrics and geosynthetics, among others — has formed an alliance with
Montreal-based FieldTurf Tarkett, a manufacturer of synthetic turf systems for sport applications.

As part of the agreement TenCate will supply TenCate Thiolon® monofilament and fibrillated
fibers and backing to FieldTurf Tarkett, as well as other sub-base and infill products that can be
used in the FieldTurf® patented surface system.

“This alliance with FieldTurf Tarkett allows us to share knowledge and speed the development
of new technology for the marketplace,” said Heard Smith, group director, TenCate Grass. “The
information transfer between our organizations is already showing results with product improvements
and even better customer service.”

January 16, 2007

Vietnam became a member of the World Trade Organization (WTO) on January 11, paving the way for
removal of textile and apparel import quotas. However, Vietnam’s textile and apparel exports will
be closely monitored under a new US Department of Commerce program designed to ensure there are no
unfair trade practices. If that happens, the Bush administration has pledged to self-initiate
anti-dumping procedures that could result in penalties, including new import restrictions.

US Trade Representative Susan C. Schwab hailed Vietnam’s entry into the WTO as an “historic
day” marking the beginning of a new era in political and economic relationships between the United
States and Vietnam. She said it is “an important milestone” in the continuing process of expanding
commerce and raising living standards around the world. Schwab also noted that Vietnam’s entry into
the WTO is based on commitments to abide by international trading rules and will provide greater
access to its fast-growing market of more than 82 million people.

January 16, 2007

The Board of Directors of Lawrence, Mass.-based Malden Mills Industries Inc. — developer, producer
and marketer of Polartec® fabrics — has approved sale of the company to Boston-based Gordon
Brothers Group — an international advisory, operating and financial services firm that assists
companies during times of restructuring.

The transaction, valued at $44 million, is expected to close at the end of February, pending
court approval; it is subject to higher and better offers. Malden Mills has entered into Chapter 11
of the US Bankruptcy Code in order to implement the sale, which, according to the company, will
provide an efficient environment for its completion.

According to the company, employees will not be affected and current management is expected
to remain in place, pending the direction in which the new ownership wishes to take the business.

“The sale of Malden Mills to Gordon Brothers Group transitions the company into a state of
permanent ownership and financial stability,” said Michael Spillane, CEO, Malden Mills “This
financial transaction will significantly improve the company’s balance sheet, enabling Malden Mills
to continue to serve our customers in both the commercial and military markets.”

January 16, 2007

US Trade Representative Susan C. Schwab said trade legislation passed in the waning hours of the
109th Congress and signed by President George W. Bush has ushered in a “new era of economic
opportunity and cooperation” between the United States and its trading partners. She says the
legislation underscores a US commitment to advancing trade policies that benefit US consumers and
manufacturers and promotes economic development overseas. She expects the bi-partisan support shown
for that trade package to continue in the new Congress that convened this month.

The first two issues on the agenda will be ratification of already negotiated free trade
agreements with Colombia and Peru. They very likely will be ratified without a fight as both US
textile manufacturers and importers of textiles and apparel area are reasonably satisfied with
them. However, the rhetoric in the congressional debate could signal what the attitude will be as
additional trade issues come to the fore.

Schwab says granting permanent normal trade relations (PNTR) to Vietnam and extending trade
preference programs to Haiti, the Andean nations and sub-Saharan Africa will help alleviate poverty
and create economic opportunities for people in dozens of developing countries, while giving US
consumers more choices for textiles and apparel.

According to Schwab, the Vietnam legislation will result in lower tariffs on goods entering
that country and should improve protection of the intellectual property of US manufacturers. She
said Vietnam’s impending admission to the World Trade Organization (WTO) will provide greater
access to that country’s fast-growing market of some 82 million people.

US textile manufacturers, however, are much more concerned about Vietnam’s imports than they
are about exports, as all US import quotas will be removed upon Vietnam’s official entry into the
WTO. In view of the industry’s concerns, the Bush administration has agreed to monitor Vietnam’s
clothing and textile imports, and if it is determined that there may be dumping or other illegal
trade practices, the US government will self-initiate anti-dumping cases. The US Department of
Commerce’s International Trade Administration last November published proposed procedures for
implementing that effort. The public comment period closed December 26, and the agency is now
developing its final procedures, which will remain in effect until Jan. 19, 2009, when President
Bush’s term in office expires.

January 9, 2007