March 22, 2004

BioEnvelop teams with U.S. biodegradable packaging maker to develop new products

BioEnvelop Technologies, in Laval, Quebec has signed an exclusive agreement to provide its new coating product line, BioE100(tm), to Biosphere Industries, a U.S. manufacturer of biodegradable packaging, used primarily for food products. The company says its BioE100 film can be used in conjunction with Biosphere's PPM100 material to create a new product line, PPM200, capable of withstanding contact with hot or cold liquids, as well as being microwave and oven compatible.

The four-year agreement follows a 17-month comprehensive formulation and trial process and sets out minimum production levels for BioE100, starting at 66,000 kilograms (kg) and gradually increasing to 510,000 kg. This will enable BioEnvelop's product to be integrated with Biosphere's materials into a full-scale pilot-plant process within a six-month period.

With a view to launching production in Asia, Biosphere has licensed its proprietary technology for manufacturing biodegradable packaging to Care for Earth, a subsidiary of Dominance, which is part of a Malaysian group of companies. Biosphere intends to integrate the PPM200 process into the licensee's operations in order to launch a new line of trays, bowls, and cups which can hold liquids and maintain the heat in the microwave and oven, while still maintaining its biodegradable nature. The terms of the licensing agreement provide for an investment of several million dollars to upgrade the manufacturing capacity.

Founded in 1998, BioEnvelop Technologies develops, manufactures and markets biodegradable films and coatings such as Longevita(r), an edible, protein-based coating designed to prolong shelf life and inhibit humidity transfer in fresh and frozen food products, and Bari- Kad(tm), a gel or solid film aimed at the agri-food market. With the development of its BioE100, the firm has moved into the realm of biodegradable films for packaging, protecting and transporting food products.

"The breakthrough technology of BioE100 will allow for the commercialization of products that have endless applications in the consumer packaged goods market and greater food industry. Biosphere and its manufacturing licensee, Care for Earth have proven state of the art designs and operations in place to proceed to market in a quick and effective manner," noted BioEnvelop president and CEO Nagui Naoum.

Biosphere began operation in 2002 as a packaging equipment manufacturer. It subsequently decided to design and create its own biodegradable packaging process and has evolved into a one-stop shop providing both the turnkey equipment and proprietary technology for this emerging market sector. The company selected BioEnvelop's process on the basis of its functional superiority, efficient manufacturing process and cost-effective production.

More information on BioEnvelop is available from John Dempsey, 450/975-9333, or on the company's Web site, www.bioenvelop.com. More information on Biosphere is available from Elie Helou, CEO, 805/566-6563.

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