Joan Fabrics Completes Sale Of Assets

Tyngsboro, Mass.-based specialty textiles manufacturer Joan Fabrics Corp. has completed the sale of
company assets as part of the liquidation of its business under the guidance of New York City-based
Carl Marks Advisory Group LLC (CMAG). CMAG took over management of the company in March 2007 and
helped restore it to a state of operational health to enable it to be sold as viable operation.

The company has sold its Circa 1801/Doblin, Home Fabrics and Mastercraft Contract/Guild 360
product lines to Valdese, N.C.-based jacquard upholstery fabric manufacturer Valdese Weavers LLC.
Texel, Joan Fabrics’ Mexico-based operation, along with intellectual property related to the
Mastercraft residential business, have been sold to Joan Fabrics Chairman Elkin McCallum.
Boston-based Gordon Brothers Group LLC has acquired non-operating machinery and equipment, and Fred
Godley of North Carolina has acquired non-operating plants and warehouses in North Carolina. The
Mastercraft residential business was not sold, and its inventory has been sold off separately.

In the case of Circa 1801/Doblin, the deal includes all assets, including design and
manufacturing equipment. The Circa 1801 facility in Connelly Springs, N.C., will continue to house
that operation, and the established management team including John Lenox, Margaret Coffin and Bill
Garner will continue to lead the business. Valdese Weavers will support Circa 1801 with its own
vertical operations and financial resources. Parts of the Home Fabrics business, which was part of
Circa 1801, will be carried forward and merged with the Wesley Mancini by Valdese Weavers brand as
Home Fabrics by Wesley Mancini. Valdese will merge the Mastercraft Contract/Guild 360 business into
the Valdese Weavers Contract brand, with the existing management team led by Blake Millinor. The
manufacturing operation will be housed in the Valdese Weavers and Circa 1801 facilities.

“The swift reinvigoration and sale of Joan Fabrics’ assets was an immense accomplishment. We
are confident the transactions were well targeted and executed with the right buyers,” said Rick
Heller, partner, CMAG. “The US textile industry is experiencing exceptionally difficult times as a
result of much manufacturing moving offshore. To be able to sell Joan Fabrics’ assets in such a
short period of time is a real victory and very good for the company and its stakeholders.”

July 31, 2007