Stock Code: 000055,200055 Stock ID: Fangda Group, Fangda B Announcement No. 2010-45

    China Fangda Group Co., Ltd.

    Announcement on Progress of “Panasonic Lawsuit”

    The members of the Board and the Company acknowledge being responsible for the truthfulness, accuracy, and completeness of the announcement. Not any false record, misleading statement or significant omission carried in this announcement.

    I. Disclosure of the case

    This lawsuit case has been disclosed in 1. Major unsettled lawsuit under VII. Contingent Issues in the Notes to Interim Financial Statements of 2010.

    II. Briefing of the case

    On March 31, 2010, the Company raised lawsuit to Guangzhou Middle Court claiming for patent protection against Panasonic Corporation of China regarding two of the Company’s patent properties, which were the “flexible bearer and conjunction device” (Patent No. ２００７２０１１８０９６．７) and “on-ground mounting device” (Patent No. ２００４２００８２８４７．０). The claiming was to stop Panasonic Corporation from invalid operations and RMB5 million of compensation to the Company. The lawsuit was accepted by Guangzhou Middle Court.

    II. Latest progress

    On July 7, 2010, Panasonic Corporation in China raised invalid patent revising application to the Patent Revising Committee of National Bureau of Intelligence Property.

    The Company received the Judgment upon the above applications regarding the above two patents issued by Patent Revising Committee of National Bureau of Intelligence Property on December 22, and December 28 respectively. One of the Judgments is supporting full-validation of the “flexible bearer and conjunction device” (Patent No. ２００７２０１１８０９６．７), and the other is supporting partial validation of “on-ground mounting device” (Patent No. ２００４２００８２８４７．０).

    III. If there is any undisclosed lawsuit issues?

    There isn’t any other lawsuit issues or arbitration issues involved by the Company or the holding subsidiaries of the Company which should be disclosed but not disclosed.

    IV. Influence of the lawsuit on the Company

    This case will make positive influence on the Company regarding patent property protection.

    The above is for the attention of the shareholders.

    The Board of Directors of

    China Fangda Group Co., Ltd.

    December 30, 2010