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Covalon Announces Receipt of First Payment Under New License Agreement

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Covalon Technologies Ltd. (the "Company" or "Covalon") (TSXV: COV;
OTCQX: CVALF), an advanced medical technologies company, today announced
that it has received $3.5 million USD under a new license agreement
("Agreement") with a large global medical company ("Medical Partner").
The Agreement provides the Medical Partner with certain rights to use
Covalon's patented antimicrobial medical coating technology with some of
its devices. The Agreement was entered into in the ordinary course of
business of Covalon and is subject to confidentiality provisions.

In addition to the $3.5 million USD which has today been received by
Covalon, the Medical Partner has also agreed in the Agreement to pay to
Covalon:

  • $5 million USD in additional license fees as certain technology
    development milestones are achieved;
  • Fees for Covalon technology development services and equipment; and
  • Ongoing royalties on worldwide product sales (subject to regulatory
    clearance of the products).

"This new license agreement is yet another milestone for Covalon," said
Brian Pedlar, Covalon's Chief Executive Officer. "It is a validation of
Covalon's patented medical coating platform, which helps prevent
infections and saves lives in many clinical settings."

About Covalon

Covalon Technologies Ltd. researches, develops and commercializes new
healthcare technologies that help save lives around the world. Covalon's
patented technologies, products and services address the advanced
healthcare needs of medical device companies, healthcare providers and
individual consumers. Covalon's technologies are used to prevent, detect
and manage medical conditions in specialty areas such as wound care,
tissue repair, infection control, disease management, medical device
coatings and biocompatibility. To learn more about Covalon, visit www.covalon.com.

Neither TSX Venture Exchange nor its Regulation Services Provider (as
that term is defined in the policies of the TSX Venture Exchange)
accepts responsibility for the adequacy or accuracy of this release.

This news release contains forward-looking statements which reflect
the Company's current expectations regarding future events. The
forward-looking statements are often, but not always, identified by the
use of words such as "seek", "anticipate", "plan, "estimate", "expect",
"intend" and statements that an event or result "may", "will", "should",
"could" or "might" occur or be achieved and other similar expressions.
These forward-looking statements involve risk and uncertainties,
including the difficulty in predicting product approvals, acceptance of
and demands for new products, the impact of the products and pricing
strategies of competitors, delays in developing and launching new
products, the regulatory environment, fluctuations in operating results
and other risks, any of which could cause results, performance, or
achievements to differ materially from the results discussed or implied
in the forward-looking statements. Many risks are inherent in the
industry; others are more specific to the Company. Investors should
consult the Company's ongoing quarterly filings for additional
information on risks and uncertainties relating to these forward-looking
statements. Investors should not place undue reliance on any
forward-looking statements. The Company assumes no obligation to update
or alter any forward-looking statements whether as a result of new
information, further events or otherwise.

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