NAT, Lenzing Sign Joint Development Agreement

Naturally Advanced Technologies Inc. (NAT), Vancouver, Canada, and Lenzing AG, Austria, have
entered into a joint development agreement under which the two companies will evaluate the blending
of NAT’s enzymatically processed CRAiLAR® Flax fiber with Lenzing’s Tencel® and Lenzing Modal®
regenerated cellulosic fibers. Potential applications for any yarns that might be developed include
fashion and sport performance.

“This is an important development for CRAiLAR Flax in that, to-date, both of our commercial
and exploratory partnership agreements have been focused on how CRAiLAR can blend at varying levels
with natural fibers for apparel, home and industrial applications,” said Ken Barker, CEO, NAT.
“With Lenzing, we can now evaluate the opportunity to expand the host fibers with which CRAiLAR can
blend to identify new performance attributes, applications and industries. This is truly a new
frontier for the future of our natural fibers, and working with the global leader Lenzing creates a
very powerful industry platform in both sustainability and performance. This partnership will have
applications in industry sectors where polyester fibers have been the norm, in addition to our
existing applications as a sustainable complement to cotton.”

The two companies intend to develop a range of yarns that: stress the fibers’ sustainability
attributes; leverage the water absorption and wicking properties of each fiber to offer
alternatives to current materials used in athletic and sport performance apparel; and develop a
blended yarn featuring Crailar and Lenzing’s fibers to offer to the women’s fashion market.

May 15, 2012