China Textile Machinery Limited By Share Ltd Litigation Court Ruling Announcement

A share code: 600610A shares short: SST spinning number: pro 2010-022

All members of the company and the board of directors guarantee the authenticity, accuracy and completeness of the announcement, and are jointly and severally liable for false statements, misleading statements or major omissions of the announcement.

A few days ago, our company reached a settlement agreement with the Bank of Shanghai (2010-018) on the case of the US dollar loan contract (see the company's Bulletin No. 5A). The company has received the consent order from the high court of Hongkong Special Administrative Region. According to the forty-second order of the high court rule 5A of the Special Administrative Region of the Republic of China, according to the joint application of the counsel of the Bank of China and the first defendant company and the second defendant China Huayuan Group Limited, we hereby agree to the following:

1, the plaintiff's request for the first defendant and the second defendant is withdrawn and shall not be revoked; and

2, we will not make a ruling on the relevant costs of the case, and the parties themselves will bear the expenses regardless of any previous concerns.

A ruling on costs.

The three defendants of the original defendant agreed with the ruling made by the above consent order and signed by the authorized lawyer in the consent order.

This is hereby announced.

China Textile Machinery Limited by Share Ltd

December 11, 2010