Cone Denim Jiaxing Signs Loan Agreement With Bank Of China

Cone Denim Jiaxing Ltd., a China-based joint venture between Greensboro, N.C.-based International
Textile Group and Hong Kong-based Novel Holding Ltd., has signed a cooperation agreement with the
Bank of China Ltd., Beijing, which includes a $35 million term loan and a $15 million working
capital line of credit.

“Cone Denim Jiaxing is working with the Bank of China and the Jiaxing Economic Development
Zone to create a world-class denim company in that region,” said John Bakane, chairman of the
board. “Construction of our 28 million-yard manufacturing facility is underway, and we expect to be
providing high-quality fashion denims to our customers by the first half of 2007.”

The new facility, located in Jiaxing City, Zhejiang Province, about 90 miles south of
Shanghai, will be a vertical operation, processing raw cotton through finished denim fabric. It
will have a workforce of approximately 700 people.

March/April 2006