OTC: BNET

Our leadership team believes, despite the difficulties
Bion has faced, the Company is now ready for successful commercial launch, having accomplished the following:

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Capital structure cleanup and significant debt
settled

Settlement agreements were executed with legacy principals
that substantially simplified the capital structure and reduced potential dilution (see Notes 6 & 8, Giveback and Settlement Agreements);

Settlement agreements were executed with creditors
related to the Fair Oaks demonstration facility (see Notes 8, 11, Item 3, Hamstra and North Prairie Holdings Settlements).

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Technology now commercial-ready

Completed optimization; value proposition proven;
ready for final design (see Platform and Development below)

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Strong fertilizer demand demonstrated

Several non-binding offtake commitments for AB10 nitrogen
fertilizer have been executed. Letters of support for a federal grant application were received that exceed the anticipated initial commercial
project’s production capacity (see below: Gen3Tech Platform, 2. Fertilizers: Organic and ‘Low Carbon’).

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Demonstrated developers/operators demand for ammonia
control solutions

There is tremendous uncertainty over RNG policy and
pricing. Optimizing existing facilities has become a key focus for the biogas/RNG industry that is actively seeking comprehensive resource
recovery. Bion believes its ARS and AB10 represent the best ammonia recovery value proposition available today.

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Built a strong core team to execute a commercial
strategy

Bion has added key talent in engineering, agronomy,
project management, and marketing.

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Built key relationships: engineering, finance,
fertilizer distribution

Bion has proven to be a serious and respected solutions
provider that has attracted the attention of a wide range of stakeholders in engineering, finance, agriculture, and fertilizer.

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During the past two years, Bion has worked to establish
itself as a credible and capable participant in the livestock waste treatment, renewable energy, and sustainable agriculture markets.
Management believes its ARS technology has the potential to fundamentally change the economics of manure and digestate management by recovering
nitrogen as a high-value organic fertilizer rather than treating it as waste. These successes coincide with long term trends in sustainable
agriculture, renewable fuels, and the circular economy that favor Bion’s business opportunities. Bion leadership believes this confluence
of events positions the Company, assuming it continues to align with appropriate strategic partners and obtains sufficient financing,
to exploit a unique and growing opportunity at the intersection of agriculture, renewable energy, the environment, U.S. food security
and public health, and consumer demand.

Summary and Overview

Bion Environmental Technologies, Inc.("Bion,"
"Company," "We," "Us," or "Our") was incorporated in 1987 in the State of Colorado. Bion’s
long term mission has been to make livestock production more sustainable, profitable and transparent. Bion developed its Gen3Tech platform
and business model (discussed below) to clean up existing Concentrated Animal Feeding Operations (CAFOs) or build new state-of-the-art
facilities that have minimal environmental impacts, produce premium-branded sustainable meat and dairy products, and recover renewable
energy, premium fertilizers, and clean water. The Gen3Tech is anchored by Bion’s patented Ammonia Recovery System (ARS), which captures
and stabilizes the problematic ammonia and CO2 released when biogas is produced from organic waste and upcycles them into high
value advanced organic fertilizers.

For the 10 years up until the end of 2024, Bion was
focused on developing large integrated sustainable beef projects centered on our Gen3Tech platform, because we believed the beef industry
was the most challenged of all the livestock sectors and would therefore benefit the most from the application of Bion’s technology
and business strategy. However, it became apparent to new management that neither the industry nor the markets were ready to embrace sustainable
beef; and moreover, Bion did not have the capital and other resources necessary to successfully navigate the long timelines needed to
develop such projects. Management shifted the Company’s focus away from developing its own integrated beef (or other livestock)
projects to using its core ARS as a standalone/bolt-on ammonia control solution to benefit others’ CAFO and industrial biogas facilities.

During the second half of calendar 2023, the Company
completed construction of our Ammonia Recovery System at our commercial scale demonstration facility located near Fair Oaks, Indiana.
Through 2025, Bion optimized the ARS to prepare for final design of a full-scale commercial system. The ARS exceeded expectations for
performance related to both ammonia recovery and economic efficiencies. The ARS can recover and upcycle ammonia and CO2 from
any organic waste stream, provided Anaerobic Digestion (AD) is first used to recover biogas. In 2024 our patents were expanded to include
organic waste streams from industrial sources, such as food (scrap), food and beverage processing, slaughter/packing, and municipal wastewater,
as described below. Over the last two years, we have optimized our technology and its economics, demonstrated its capabilities to key
stakeholders, and we have been pursuing the business opportunities they represent.

Unlike CAFOs that are regulated under a ‘nutrient
management plan’, industrial and municipal facilities are ‘point sources’ under the Clean Air and Water Acts. Their
emissions and discharges are strictly regulated by US EPA, and they are required to control nutrients in their waste stream discharge.
With the January 2024 patent that extended our IP to include these sources, we believe additional (and potentially very robust) opportunities
exist (in addition to animal manure waste) for our ARS as a standalone ‘bolt-on’ ammonia control solution for those facilities
that produce biogas from organic waste streams. We also believe that the standalone opportunity, especially if a retrofit of an existing
biogas facility, could represent a much shorter project development timeline and path to revenues, compared to a new beef facility We
intend to pursue this opportunity with strategic partners with specific expertise and an operating footprint in the biogas/ renewable
natural gas (RNG). We are evaluating several such potential partners at this time.

Livestock production and its waste, particularly from
CAFOs, is one of the largest sources of excess nutrients, including ammonia (nitrogen), that have been identified as the greatest water
quality problem in the U.S. today; CAFOs are also under increasing scrutiny for their impacts on air pollution and soil health. Application
of our Gen3Tech can largely mitigate these environmental problems, while simultaneously improving operational/ resource efficiencies by
recovering high-value co-products from the CAFOs’ waste stream. These ‘assets’ have traditionally been wasted or underutilized
and are the same ‘pollutants’ that today fuel harmful algae blooms, contaminate groundwater, and exacerbate climate change.
Bion’s ARS technology captures and upcycles these polluting waste emissions and discharges to produce advanced organic fertilizers
that will have a significant and positive impact on organic food production.

Many associated with the livestock industry, Bion’s
leadership included, believe that within a few years, CAFOs will have to better manage their waste – especially ammonia/nutrients
– and it will be required or incentivized/ subsidized in the U.S., as it is now in the EU. Implementing a new regulatory framework
in the livestock industry would create a very large business opportunity for Bion and others to provide ‘retrofit’ solutions
to CAFOs to mitigate their environmental impacts. While it has been slow to develop, it was this expectation of regulation (or an incentive-driven,
industry-wide transition to cleaner practices) that originally sparked Bion’s commitment to provide technology solutions to the
problem. With the recent and growing attention to the environmental impacts from CAFOs, especially impacts related to human health, such
as PM2.5 formation and groundwater nitrates, we believe that the demand for change in how CAFOs are regulated (or cleanup is otherwise
incentivized) is accelerating and will provide us with a robust retrofit opportunity in the not-too-distant future.

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Bion believes these opportunities can create extraordinary
value for our shareholders and employees (all of whom own securities in the Company) and both agriculture and clean fuels partners who
join us in our ventures and/or utilize our technology. We anticipate pursuing the opportunities created by our patented Ammonia Recovery
System (ARS) and the third-generation technology (“Gen3Tech”) it supports, utilizing a joint venture/strategic partner model
and/or through sales/licensing transactions. We believe our technology and our strategic partner model will enhance the businesses of
those enterprises utilizing our technology, create value for our shareholders, and improve the planet.

Changes in Approach

Prior to the departure of Bill O’Neill, our
previous CEO, Bion’s strategy was the execution of multiple letters of intent for sustainable beef JV projects in order to demonstrate
availability of scaled supply (that would stimulate retail grocers to commit to offtakes), and then moving forward with development of
those projects in quick succession. Mr. O’Neill at that time believed it would not be difficult to secure additional participation
in our Projects from additional feeders/cattlemen, especially once project financing and offtake agreements for both protein and co-products,
were in place. As described above, Mr. O’Neill departed Bion in May 2024 when it became apparent he was unable to execute such a
strategy.

Bion’s new leadership team returned the company
to its earlier approach, focusing on building an initial ‘flagship’ project to prove the ARS technology and the Gen3Tech platform
it supports at full commercial scale. Leadership made this decision after determining that a) a large addressable market for sustainable
beef does exist and consumers have demonstrated a ‘willingness to pay’ a premium for sustainable food products; however, since
such products cannot be supplied today at scale, it is not a ‘ready’ market and will take time to develop, b) an entrenched
industry is never eager for change and it will only occur through enlightened/ proven self-interest, and c) investment capital of the
magnitude needed for large scale conversion to sustainable production will first require proof of concept.

New leadership continued to focus on beef, for several
reasons, and believed the best opportunity for the Company to prove its sustainable beef concept was with the Stovall Ranch JV in Montana.
In June 2024, Bion formed a strategic relationship with Turk Stovall and Stovall Ranching Companies. Turk Stovall is a fifth-generation
Montana cattleman, with an extensive graduate-level education in cattle husbandry and an MBA in agribusiness, and he is the largest custom
cattle feeder in Montana. He also has broad experience and relationships with both the U.S. and Montana’s beef industry and important
state leaders, resources, and agencies. Bion and Stovall agreed to establish a JV, that was to be led by Mr. Stovall, with the goal of
developing a 16,000-head sustainable beef project at Stovall’s Yellowstone Cattle Feeders (‘YCF’) location in Shepherd,
Montana. Over the following months, Bion’s leadership came to understand that, even for a single integrated beef project, a) Bion
did not have the requisite resources needed to develop these large integrated projects, b) that project development timelines would be
even longer than anticipated, and c) it was unlikely Bion would be able to raise sufficient capital to execute such a plan.

Bion correspondingly pivoted to devote almost all
of its resources to the bolt-on business opportunity: using the ARS as a standalone ammonia control solution for others’ biogas
production facilities. We are currently focused on existing large-scale livestock with digesters in place, since they have waste streams
for which the ARS has been optimized. Further, we have and will continue to add resources to pursue opportunities in the industrial wastewater
sector, to exploit the patent Bion received in 2024, that broadened the claims related to its Ammonia Recovery System (ARS) to include
industrial, such as food, food processing, and livestock packing/slaughter, and municipal wastewater sources, in addition to animal waste
streams that were previously covered. These facilities are subject to EPA-mandated discharge limits that require ammonia control or face
other limitations on ammonia/nitrogen in the effluent from biogas production. We believe there is a robust opportunity to provide bolt-on
ammonia control solutions to others in the industrial and animal waste sectors. During fiscal 2026, and continuing, we are devoting almost
all of our resources to pursuing the bolt-on opportunity in both of these sectors.

In August 2025, Bion engaged Josh Rapport, MS, PhD,
to serve as Bion’s lead engineer and to find projects and strategic partners. He brings over 20 years' experience in researching,
designing, building and operating anaerobic digesters for heat, power, and renewable natural gas (RNG), as well as in digestate treatment
and utilization. He was VP Engineering for Brightmark, one of the largest RNG companies in the U.S. In less than four years, Brightmark
launched 30 RNG projects worth over $500 million under his guidance, before he left the company in 2023 to start an independent consulting
business. Josh joined Bion as a consultant with a success-based compensation package and it is anticipated he will join Bion as an employee
if/when Bion initiates its first commercial project. Josh introduced Bion to Kimmeridge Energy Management, LLC, (New York, New York),
which is an energy-focused (LNG, RNG) private equity fund with approximately $7 billion assets under management.

On December 5, 2025, the Company entered into an MOU
(Memorandum of Understanding) with Kimmeridge outlining a preliminary framework to explore the use of Bion’s ammonia recovery technology
at a large Renewable Natural Gas (RNG) facility. Under the MOU, the Company and Kimmeridge together will share costs and collaborate on
engineering work, fertilizer sample production, testing, and agronomic validation, life-cycle analysis (including CI scoring), and commercial
planning. They will also evaluate and negotiate a joint Venture to develop an Ammonia Recovery System (ARS) to produce premium organic
fertilizers at a potential RNG facility operated by an affiliate of Kimmeridge.

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As part of the MOU, the Company granted Kimmeridge
a limited Right of First Refusal (“ROFR”) on a 10 million share equity investment in the Company during the evaluation period,
at a price that is a premium to the current market price. Kimmeridge recently pivoted Bion to a different project than the one originally
contemplated. This caused a delay of approximately four months, which led to an extension of the MOU and ROFR for an additional six months
(see 8-k dated June 11, 2026). To place the MOU in the context of the Company’s business plan (and its existing public disclosure),
if the contemplated JV moves forward on the timelines anticipated, active development of a potential RNG facility could commence in the
third or fourth quarter of calendar 2026.

Bion participated in a federal grant application in
August related to the Kimmeridge project. During, and as part of that process, the Company worked with a new engineering company that
produced the equivalent of a Front-End Loading Level 1 for the grant application (“FEL-1” initial engineering study addressing
the integration of its ammonium bicarbonate technology with digestate produced by an RNG Facility). The new engineering company has been
engaged by Bion and Kimmeridge to conduct project pilot testing and produce a FEL-3 study that will include process design, mass and energy
balances, equipment configuration and specifications, utilities requirements, site-integration, along with fixed cost capital requirements
and plus or minus 10% operating cost estimates for an Ammonium Bicarbonate fertilizer production facility. The Company will dedicate Ammonium
Bicarbonate production, as directed by Kimmeridge, to mutually agreed partners and universities for product validation, agronomic testing,
and market-development activities.

Bion is currently in discussions with several other
potential strategic partners in engineering, renewable energy (biogas/RNG) and clean fuels, organic fertilizer distribution, and others
involved in reducing the environmental footprint of biogas, agriculture, and livestock production. We are now evaluating a number of these
as potential development and finance partners for project opportunities, including Kimmeridge Energy Management as described above. Bion
believes that some of these industry relationships could entail a direct investment in Bion, licensing fee, or some other ‘up front’
financial benefit to Bion, although there is no assurance that they will.

Bion’s new leadership team is strongly committed
to Bion’s continuation, its future success, and its shareholders. We have refocused the Company’s efforts to the bolt-on opportunity,
to prove the technology at full scale and reach revenues more quickly. We believe this puts us on a more achievable path. Further, this
strategy will substantially reduce our need for capital, and we believe that a more reasonable and credible objective will make it easier
to raise that capital. We also believe that the changes in leadership will lend validation and credibility to Bion and its business plan,
making it easier to execute needed strategic alliances and raise capital from potential strategic, institutional, and retail investors.

Renewable Energy/ Clean Fuels Strategic Partner

Bion is currently (and has been) in discussions with
several companies related to strategic partnerships in renewable energy – RNG – and fertilizer production. With today’s
U.S. and global emphasis on decarbonizing energy and the food supply chain, as well as a growing focus on water, the sectors have become
closely intertwined, They are evolving quickly, and integrated solutions have become increasingly complex. While Bion has over 30 years
of experience in capturing and recycling nutrients, the Company needs to build on its own abilities by affiliating with strategic partners
to fully address the overlapping opportunities in the two spaces, and how to exploit them to their fullest potential. Bion is now evaluating
both European and U.S. renewable energy developers, operators, and investors to determine the best fit for moving forward with AD/RNG
development in the U.S. After its IP was extended to industrial and municipal waste streams in January 2024, Bion announced its intention
to establish strategic partnerships and to market the ARS as a standalone ‘bolt-on’ ammonia control solution for anaerobic
digestion of both animal manure waste, as well as industrial wastewater in the U.S. (See Standalone Opportunity below).

Bion is now focused primarily on: i) operation and
production of fertilizer samples at our commercial-scale ARS installation at Fair Oaks, IN, ii) identifying biogas/ clean fuels partners
for both livestock and industrial projects, iii) developing applications and markets for its organic fertilizer products (including life-cycle
analysis (LCA) to determine Carbon Intensity (CI) Score for products, and organic listings/certifications for multiple liquid products),
iv) exploring opportunities related to stand-alone ARS markets, (v), discussions regarding initiation and development of agreements and
joint ventures (“JVs” as discussed herein), and vi) ongoing R&D activities. Each of the initiatives/activities mentioned
above are subject to resolution of the financial constraints facing the Company that are described in multiple places in this document.

Technology Platform and Development

Bion has invested decades of work and substantial
capital in the development of our technology and technology platform since 1989. The predecessors to Bion’s Gen3Tech platform, our
patented first- and second-generation technologies (“1G and 2G Tech”), were proven at commercial scale. Over 30 of these systems
were deployed at New York dairies, Florida food processing facilities and dairies, North Carolina hog farms, a Texas dairy and a Pennsylvania
dairy. The 2G Tech was reviewed and qualified for federal loan guarantees under USDA’s Technical Assessment program. Bion’s
2G Tech dairy project (“Kreider 1” or “KF1”), located at Kreider Farms in Pennsylvania (“PA”) received
the first verified /measurable nutrient reduction credits from a non-point source livestock facility in the U.S. and its nutrient reductions
were verified by the Pennsylvania Department of Environmental Protection (“DEP”) during 2012. For more information on Bion’s
2G Tech, please see Bion’s Form 10-K, for the year ended June 30, 2023. (and prior years).

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The 2G Tech was an engineering success but failed
financially because the platform was dependent on either regulation or revenues from an anticipated incentive program under the Chesapeake
Bay Strategy, that did not materialize. By the mid-2010’s, it became apparent that neither of these options were imminent or even
assured, so the Company initiated the steps to reimagine and redesign its technology. The Gen3Tech platform was developed to maximize
value from resource recovery and co-products, by using AD to produce biogas and our ARS to produce fertilizer products.

The core technology that supports the Gen3Tech platform
is Bion’s patented and proprietary Ammonia Recovery System (ARS), which utilizes existing commercial evaporation and distillation
process equipment (with decades of reliability and service history) that is customized for Bion’s specific applications. The ARS
uses evaporation to first isolate the ammonia from the solids in the waste stream, by evaporating most of the ammonia and a certain amount
of water; that ‘clean’ stream is then condensed, concentrated, and stabilized with CO2 from the waste stream, the
key step in Bion’s patented process to produce its organic nitrogen fertilizer. The first patent on the ARS was filed in 2015. A
Notice of Allowance from the US Patent and Trademark Office (“USPTO”) was received during August 2018 related to this patent
application and the patent was subsequently issued. Since July 2017 Bion has filed for continuations of this patent to provide broadened
protections and to cover improvements to the process developed in the interim. During August 2020 the Company received a ‘Notice
of Allowance’ for our third patent related to our Gen3Tech and additional related applications are pending and/or planned (See “Patents”).
In January 2024, the ARS claims were extended to industrial and municipal wastewater streams, in addition to the animal manure waste streams,
previously covered.

In June 2025, Bion completed and released its Technology-Optimization
Report, that details the development and 18-month optimization of the ARS at our demonstration facility in Fair Oaks, Indiana. The optimized
ARS demonstrated it is stable and can maintain continuous steady-state operations, reliable, and scalable. The ARS also showed it can
achieve its ammonia reduction targets by evaporating one-third less water than was anticipated and modeled. That translates to significantly
better economics, including lower fertilizer production costs. The platform is now ready for the final design process of a full-scale
commercial system, which is subject to project-specific details, location, and feedstock characteristics.

Over the past few years, Bion has continued its R&D
efforts and is now ready to move forward with its fourth generation of technology, an ARS that does not use the large evaporators to isolate
the ammonia (the evaporators use a considerable amount of fossil natural gas). Instead, the platform will utilize alternative solids separation,
such as a filter press, centrifuge, membranes or other technique, to first remove solids, prior to distillation to the desired concentration.
This fourth-generation technology will reduce capex somewhat but will have a dramatic impact on operating costs by no longer having to
drive an energy-intensive evaporation process with natural gas.

Ammonia Recovery System

The patented ARS is the core of Bion’s Gen3Tech
platform. It recovers and upcycles more than 90 percent of the volatile ammonia that is available in the livestock manure (or other organic)
waste stream effluent after biogas/methane is produced through anaerobic digestion. The technology has applications in various industrial
organic waste streams, including food processing, slaughter/packing plants, and municipal facilities that utilize AD to produce biogas.
The ARS utilizes the CO2 that is also in the organic waste stream to stabilize the ammonia, forming ammonium carbonate/bicarbonate
in either a liquid or solid form (although only the liquid has been certified organic). Ammonium bicarbonate has a long history of use
as a water-soluble nitrogen fertilizer, that was commonly used before the advent of low-cost synthetic fertilizers, such as urea.

Ammonia nitrogen enters the environment through volatilization
(evaporation) from the AD effluent, before and after it is applied to croplands as fertilizer, or it enters the water supply directly
in runoff from fields where it has been spread. Approximately 80 percent of the ammonia in livestock manure is lost in this manner. Once
the ammonia has escaped to the environment, it is highly mobile, water soluble, and difficult to recapture and treat (it is the primary
cost-driver in municipal wastewater treatment). Airborne ammonia can contribute to the formation of PM2.5, small inhalable particulate
matter that causes respiratory distress and is regulated under the Clean Air Act. In runoff, ammonia in the form of nitrate contaminates
groundwater and fuels algae blooms in coastal waters that are becoming increasingly toxic. Ammonia nitrogen is the primary driver of nutrient
runoff that US EPA calls the most expensive and difficult to treat water quality problem in the U.S. today. Capturing and stabilizing
the ammonia both minimizes its environmental impacts and allows us to produce our low-carbon and/or organic ‘pure’ nitrogen
fertilizer products that can be transported to where they are needed and applied when they are needed.

Operating results at the Initial Project demonstrate
ARS performance exceeded initial expectations for ammonia recovery and related economics. The Company has achieved multiple key technical
objectives in the optimization of the ARS, which will support the final design process for full-scale systems, both for third- and fourth-generation
platforms. The ARS has achieved and maintained controlled operations under a variety of conditions, producing both liquid and crystal
ammonium carbonate/bicarbonate. Bion has optimized the ARS’s operating parameters and has demonstrated that it meets and/or exceeds
the results needed for Bion’s economic models for large-scale commercial projects.

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Bion received an OMRI (Organic Materials Review Institute)
Listing on its first commercial nitrogen fertilizer product, a 10-0-0 ammonium bicarbonate solution, in August 2024, which provides assurance
to organic growers and their certifiers that the fertilizer can be used in organic production. Fertilizers that can be used in organic
production command substantially higher prices (8x to 10x) than synthetic (chemically-produced) commercial fertilizers, such as urea.
Bion will initially focus on several markets for its OMRI Listed fertilizers, including production of high-value specialty crop fruits
& vegetables and Controlled Environment Agriculture (hydroponic, aeroponic, and greenhouse applications). Bion also expects demand
for row crops, such as corn, cover crops and other regenerative practices. Bion is also evaluating non-agriculture markets, including
retail home lawn and garden, golf courses, city parks, schools, and youth sports fields, which are all experiencing trends toward natural
and safe products. At this time, Bion intends to continue producing fertilizer products at the Initial Project to support testing and
life-cycle analysis, product trials, and ongoing organic and low-carbon fertilizer initiatives.

Final economic and energy efficiency models will be
validated during the final design process. The Company has prepared an evaluation and technology optimization report on the ARS and its
economics, under guidance from Buflovak. We believe this data will also provide potential stakeholders, including a) livestock producers,
b) biogas and clean fuels developers and producers, c) operators of industrial and/or municipal facilities utilizing ADs and d) financial
institutions with the information they need to proceed with confidence in collaborating with Bion on projects. Each of the initiatives/activities
referenced above are subject to resolution of the financial constraints facing the Company that are described in multiple places in this
document.

Gen3Tech Platform

Our Gen3Tech platform can provide comprehensive waste
treatment and resource recovery that is unmatched in the industry today. The platform consists of manure handling and conditioning, anaerobic
digestion (AD), and is anchored by our Ammonia Recovery System (ARS) and fertilizer processing, handling and storage. Additional components
can be added, such as solids handling, clean water polishing, gas upgrading to RNG, etc, up to a complete ‘zero discharge’
system. The Gen3Tech platform provides the cornerstone for sustainable livestock production, with four distinct benefits/ revenue streams:
1) biogas revenues, including pipeline quality RNG and related carbon and other environmental credits, 2) premium fertilizer product revenues,
3) premium pricing for USDA PVP-certified (or otherwise verified) ‘Environmentally Sustainable’ or ‘Eco-friendly’
brand, and potentially 4) nutrient reduction credits in certain watersheds. Carbon and nutrient credit revenues can be supported by third-party
verification of the waste treatment processes with relatively limited incremental cost to Bion. The same verified data will also provide
the backbone for the USDA PVP-certified sustainable brand, with limited incremental cost.

1) Renewable energy and renewable energy- and carbon-related
credits:

Bion’s Gen3Tech platform utilizes
anaerobic digestion (“AD”), customized to maximize both recovery of biogas (methane) and ammonia nitrogen from the waste stream.
At sufficient scale, methane produced from AD can be cost-effectively conditioned/cleaned, compressed and injected into a pipeline (RNG)
or used onsite, depending on project needs and economics. The US Renewable Fuel Standard (“RFS”) program and state programs,
like the LCFS in California and elsewhere, provide ongoing renewable energy credits for the production of biogas and its subsequent use
as a renewable fuel. The CO2 freed up in the AD process will be recycled for use in the production of organic fertilizer products
along with the ammonia-rich digestate, instead of venting it to atmosphere. Gen3Tech facilities can also generate photovoltaic (solar)
electricity from modules placed on the roofs of the barns to supply onsite needs and/or export to the grid, depending on project requirements.
Additional renewable energy-related credit programs are being developed that Bion believes will impact these revenues, including a Carbon
Intensity (CI) score that measures the amount of carbon produced per unit of energy produced.

2) Fertilizers: Organic and
‘Low Carbon’:

The Company has focused a large portion
of its activities on developing, testing, and demonstrating the third generation of its technology and technology platform, with emphasis
on increasing the efficiency of production of valuable co-products from the waste treatment process, including ammonia nitrogen in the
form of organically certified soluble nitrogen fertilizer products. The ARS captures the ammonia-nitrogen and CO₂ released during
RNG production, then converts these two environmental challenges into Ammonium Bicarbonate. Bion’s AB is a high-value organic fertilizer
that belongs to a new class of organic nitrogen products that command prices significantly higher than conventional nitrogen fertilizers.
The ammonium bicarbonate products produced by Bion’s ARS and Gen3Tech platform require the use of no outside compounds or chemicals
and will enjoy a dramatically lower carbon footprint than synthetic nitrogen fertilizers.

In May 2025, Bion secured its first non-binding
offtake commitments for its AB10 nitrogen fertilizer. The agreements were with Perfect Blend and Yield RNG, large West Coast organic fertilizer
distributors. The agreements are attached as exhibits to Bion’s 8-k, dated May 30, 2025. Bion subsequently executed a similar offtake
with a large integrated U.S. agribusiness concern that requested confidentiality. These three initial offtakes represent 250,000 gallons
of Bion’s liquid AB10. In a recent grant application, Bion received Letters of Support from one of the largest distributors of organic
fertilizers in the U.S., as well as one of the largest suppliers of consumer retail (home lawn and garden) products in the U.S.

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Much of the reactive nitrogen captured and
upcycled into our fertilizer products was going to be lost through volatilization and runoff, and that loss would generally need to be
offset with a synthetic nitrogen fertilizer, such as anhydrous ammonia or urea. These synthetic nitrogen products are produced through
the Haber-Bosch (and other) synthetic processes, which converts hydrogen and atmospheric nitrogen to ammonia in the form of urea, with
methane from fossil fuels as the energy source. It is an extremely energy-intensive process with a very large carbon footprint that accounts
for much of agriculture’s overall carbon footprint. To the extent that Bion can capture and repurpose the nitrogen traditionally
lost from livestock waste, that carbon cost will no longer need to be paid by the environment/climate.

The Company’s ammonium bicarbonate
liquid product successfully completed its Organic Materials Review Institute (“OMRI”) application and review process with
listing approval during May 2020. In March 2024, Bion applied for an OMRI (Organic Materials Review Institute) Listing on its first commercial
nitrogen fertilizer product, a 10-0-0 ammonium bicarbonate solution. Bion was granted the Listing in August 2024, which provides assurance
to organic growers and their certifiers that the fertilizer can be used in organic production. Ammonium bicarbonate, manufactured using
thermal and mechanical processes, has a long history of use as a fertilizer.

Fertilizers that can be used in organic production command substantially
higher prices than synthetic (chemically-produced) commercial fertilizers, such as urea. Based on preliminary market surveys to date,
we believe that existing competing organic fertilizer products are being sold presently at price points significantly greater than Bion’s
projected cost and projected pricing. Bion will initially focus on several markets for its OMRI Listed fertilizers, including production
of high-value specialty crop fruits & vegetables, organic row crops, and hydroponic, aeroponic, and greenhouse applications. Further,
Bion is also evaluating opportunities in regenerative practices that include fertilized pastures to graze cattle. We also believe that
livestock products from animals raised with feed grains grown using Bion’s organic ammonium bicarbonate fertilizer products (and
that otherwise qualify) will receive organic approvals. Bion is also evaluating non-agriculture markets, including retail home lawn and
garden, golf courses, city parks, schools, and youth sports fields, which are all experiencing trends to natural and safe products

In addition to liquid ammonium nitrogen
fertilizer, Bion’s ARS is capable of recovering nitrogen in the form of solid ammonium bicarbonate products containing up to 18%-22%
(or higher) nitrogen in a crystalline form that is easily transported (while producing liquids with various percentages of ammonium bicarbonate
nitrogen during interim stages of the process). This solid product is water soluble and provides a readily available nitrogen source for
crops. It will contain virtually none of the other salt, iron and mineral constituents of the livestock waste stream that often accompany
other organic fertilizers. This product is being developed to fertilizer industry standards so that it can be precision-applied to crops
using existing equipment.

Applications for our first solid form of
concentrated ammonia, soluble nitrogen fertilizer product line were filed with OMRI (filed during May 2021) and CDFA (filed during May
2022) without success. After an extended review processes (which was largely opaque), the OMRI application proceeded through multiple
stages without receiving a positive result. The Company’s solid product line is novel (in the context of organic certification)
in part due to the fact that no formal listing category currently in the organic space for a solid form of concentrated ammonia, soluble
nitrogen fertilizers and there is no clear guidance at present from internal policy manuals on how to categorize this product and the
process that produces it. The Company intends to continue efforts to obtain listing/certification for its solid nitrogen fertilizer line.
In evaluating and approving Bion’s liquid ammonia for OMRI listing, Bion’s patented ammonia recovery system was not deemed
synthetic. That is an important distinction for future Bion product filings based upon the same patented process.

Bion will also work with industry and academic
entities to develop appropriate metrics and produce an independent carbon footprint, a ‘life cycle assessment’ (LCA), for
Bion’s ammonium nitrogen fertilizer product. Because Bion’s ARS recovers both nitrogen and CO2 from the waste stream
(including using CO2 as a stabilizing agent that is usually vented to the atmosphere), it creates added carbon offsets compared
to natural gas utilized as feedstock in chemical ammonia production, which reduction will be reflected in the LCA. This LCA will assess
environmental impacts associated with fertilizer production in support of the beef cattle and other livestock supply chains for both the
existing conventional approach (primarily fossil fuel-based Haber-Bosch production methods) and the largely decarbonized Bion production
approach. We believe a series of coincident, yet significant LCA benefits accrue from Bion’s patented fertilizer production approach
that will lead to a very low carbon footprint. Bion has conducted a preliminary LCA – while it is not considered ‘independent’,
it used the internationally-accepted GREET model – and it demonstrates our ammonium bicarbonate has a dramatically lower carbon
footprint that is 96 percent less compared to the urea baseline.

3) Sustainable Brand Premium:

The positive environmental impacts of Bion’s
processes are all third-party verifiable, providing a valuable benefit to the food supply chain. Independent verification will allow improvements
to air, water, and soil quality to be quantified for the purposes of a sustainable brand. Consumers have demonstrated a willingness to
pay a premium for safe and sustainable food choices. Based on Bion’s recognition of the potential opportunities created by such
willingness, beginning in 2015, Bion worked with the USDA’s Process Verified Program (“PVP”) – the ‘gold
standard’ in food verification and branding – to establish a USDA PVP-certified sustainable brand. Bion received conditional
approval from the PVP related to its Kreider 1 project (utilizing 2G Tech). PVP certification incorporated as part of a recognizable brand
(together with point-of-sale information) will provide consumers with products and brands that can be trusted. Bion believes that such
a brand and livestock product line will command a pricing premium for protein products produced at CAFO’s with Bion’s treatment
platform.

7

Food safety and sustainability are
issues of growing importance in the U.S. and worldwide. Driven by growing consumer demand, large food retailers (such as Walmart and Costco)
and restaurant chains (including Chipotle and McDonalds) are increasingly demanding greater responsibility and improved sustainability
in food production practices from their suppliers. The Global Roundtable for Sustainable Beef (“Roundtable”) was created to
advance a sustainable global beef value chain that is “environmentally sound, socially responsible and economically viable”.
The Roundtable represents members from across the supply chain, including U.S., Canadian and Australian cattlemen’s associations,
Cargill, JBS, Elanco, McDonalds and A&W.

Large institutional investors have
begun to pressure the livestock industry. Ceres and several other large activist institutional investors have already expressed concerns
about carbon footprint, water quality, antibiotic usage and animal welfare in letters to management of their investment holdings in the
food production industry. The Collier Farm Animal Investment Risk & Return (“FAIRR”) Initiative was recently launched
to highlight the environmental, social, and governance (“ESG”) risks associated with large-scale livestock production.

In past years, the UN FAO has issued
several highly critical reports of the livestock industry, more recently focused on its impacts on climate change. While some of their
early reports were based on incomplete data and faulty methodologies and have since been somewhat quietly ‘retracted’, a wide
array of activist groups, including climate, animal rights, and anti-factory farming advocates, have seized on them to create a global
“anti-meat” messaging campaign. Their messaging is predicated on the (incorrect) notion that agriculture, and the livestock
sector specifically, is the largest contributor to climate change, greater than the energy and transportation sectors. While this fact
has been publicly ‘debunked’, the anti-meat campaign has been joined and amplified by various other stakeholders, governments,
and more recently, competitors in the alternative protein space, such as plant-based and cellular meats.

Over the last few years, most large
meat and dairy product retailers have announced ‘sustainability’ initiatives, although the definition of sustainability is
often unclear. Based on recent statements from the industry regarding sustainability policy, many that identify goals that are 10 to 30
years in the future, Bion believes that sustainability on the production side will look a lot like what the Company’s Gen3Tech
platform can provide today.

The more the livestock industry’s
supply chain practices become transparent and known by consumers, the more consumers are seeking alternatives. Bion’s verifiable
sustainability metrics address a wide array of consumer concerns including: a) ‘where does your food come from?’ (animal heritage
information); b) climate change (carbon) and other key environmental impacts (air/water/soil); c) antibiotic use/ standards; d) animal
welfare/ humane treatment; e) laborer welfare/ working conditions. The verification processes that can be employed by Bion’s Gen3Tech
platform support block chain traceability, providing accountability throughout that part of the supply chain addressed by Bion’s
platform and enabling any quality issues to be quickly identified by lot and location, minimizing risk to its consumers.

4) Water Quality Trading/ Nutrient Credits:

In parallel with technology development,
Bion has worked (which work continues) to implement market-driven strategies designed to stimulate private-sector participation in the
overall U.S. nutrient and carbon reduction strategy. These market-driven strategies can generate “payment for ecosystem services”,
in which farmers or landowners are rewarded for managing their land and operations to provide environmental benefits that will generate
additional revenues. Existing renewable energy credits for the production and use of biogas are an example of payment for ecosystem services.
Another such strategy is nutrient trading (or water quality trading), which will potentially create markets in certain impaired watersheds
that will utilize taxpayer funding for the purchase of verified pollution reductions from agriculture (“nutrient credits”)
by the state (or others) through competitively-bid procurement programs. Such credits then can be used as a ‘qualified offset’
by an individual state (or municipality) to meet its federal clean water mandates at significantly lower cost to the taxpayer. Market-driven
strategies, including competitive procurement of verified credits, are supported by U.S. EPA, the Chesapeake Bay Commission, national
livestock interests, and other key stakeholders.

Bion believes that nutrient reduction (and
other similar) credits and/or other methods of monetizing environmental benefits from the capture and re-purposing of nutrients (largely
nitrogen and phosphorus) from the livestock waste stream, will become available in multiple states over the next several years. Political
pressures, coupled with resistance from the entrenched interests of the cleanwater ‘status quo’, make it impossible to reasonably
project a timetable for adoption of the policy changes needed to establish a nutrient trading program (or similar program that would allow
agriculture to monetize low-cost nutrient reductions).

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Initial Project

The Initial Project is our commercial-scale Ammonia
Recovery System at Fair Oaks, Indiana, that was designed and built to optimize our core technology in preparation for development of a
full-scale commercial project. During September 2021, Bion entered into a lease for the development site of the Initial Project, located
on approximately four (4) acres of leased land near Fair Oaks, Indiana, and a related agreement regarding disposal of manure effluent
with the Curtis Creek Dairy unit of Fair Oaks Farms (“FOF”). Design and pre-development work commenced during August 2021
and construction was largely completed in September 2023, several months behind schedule. The facility utilizes effluent from the anaerobic
digesters that process the waste from the dairy. The ARS demonstration facility has exceeded expectations for both treatment performance
and economic efficiencies.

Although envisioned as a small commercial facility,
due to several constraints, the project was not developed at economic commercial scale or with an expectation of profitability. The facility
is large enough to demonstrate engineering capabilities of Bion’s ARS at commercial scale, but small enough that it could be constructed
and commissioned relatively quickly. It was designed so that successful installation, commissioning, and operations could demonstrate
scalability, determine operating parameters at scale, and provide ongoing production and engineering capabilities, all being critical
steps that must be accomplished before developing large projects with JV partners. The Initial Project produces a 10-0-0 commercial nitrogen
liquid fertilizer that received an OMRI Listing as described above. Upon completing the Initial Project’s mission—only final
design of the first commercial project remains—the Company will determine whether to continue to operate it at that location or
relocate the core modules to an alternative permanent location.

Business Opportunities

Bion’s core ARS technology and the Gen3Tech
platform and business model it supports, create three distinct, but related, opportunities for Bion and its strategic partners to exploit:
1) standalone ammonia control for industrial or livestock waste biogas production, and 2) retrofit/cleanup of existing CAFOs to mitigate
environmental impacts, 3) the transition to sustainable and sustainable-organic beef. The first opportunity – standalone ammonia
control – is here today and what Bion is focused on at this time. We have determined that the ARS has many applications in the industrial
sector, in addition to agriculture. There is a ‘sweet spot’ (a combination of source, concentration, and solids content) where
the ARS can provide cost-effective solutions, especially for food waste and food processing waste, including livestock packing/ slaughter
waste. Once Bion is sufficiently funded and staffed to adequately address the standalone opportunity, the Company will decide how best
to proceed with both the CAFO cleanup and sustainable beef opportunities.

Bion leadership believes the political will needed
to force CAFO cleanup is already beginning to manifest. While there is no Federal mandate yet, certain states are moving toward increased
regulation. Some of the larger stakeholders in the animal protein industry have recognized the inevitable and are proactively seeking
solutions. Bion is now positioned for this opportunity. While the CAFO cleanup/retrofit opportunity will require policy change, if/when
cleanup of the $200B livestock industry becomes mandated, it represents an opportunity for Bion and others that is very large. The sustainable
beef opportunity is still developing, in management’s opinion, with a first-of-its-kind large integrated project being planned that
is similar in concept to Bion’s modeled project. Bion will need significantly more resources and strategic relationships to develop
such projects, although it could participate in one (or more) on a standalone basis, to provide ammonia control and recovery.

Standalone Opportunity

Based on the positive results with our ARS at the
Fair Oaks facility, coupled with the extension of our IP to industrial and municipal waste streams in January 2024, we have begun to establish
strategic partnerships in the biogas/RNG sector and to market the ARS as a standalone ’bolt-on’ ammonia control solution for
anaerobic digestion (“AD”) of both animal manure waste (non-Bion livestock waste treatment facilities), as well as industrial
and municipal wastewater, both in the U.S. and in Europe:

A) INDUSTRIAL WASTEWATER
represents our best opportunity in the US, because these types of facilities are already regulated by point source water discharge standards.
AD is now used at more than 1,240 water resource recovery facilities in the U.S., along with 121 stand-alone systems that digest food
waste. The American Biogas Council estimates that more than 5,100 additional such sites have development potential. Germany, by comparison,
has nearly 10,000 operating AD sites, indicating the potential for substantial growth in biogas production here in the U.S.

In an industrial application, ammonia control
is an anticipated cost – Bion anticipates it could be paid a tolling fee to remove the ammonia nitrogen from the discharge stream.
As a service provider, Bion will need to be the ‘low-cost solution’ compared to other ammonia removal technologies, although
higher treatment costs could be mitigated by byproduct values as described below. This is a new application of our technology, in a sector
that is evolving quickly with the increasing focus in the U.S. on biogas production from organic waste. With our expertise and experience
limited to animal waste, it is critical that we identify a strategic partner in this space as soon as possible.

9

Bion’s technical and economic advantage in this space is
the value proposition represented by our ammonium bicarbonate fertilizer and our operational expertise. Technology/ process competitors,
such as ammonia stripping, may not produce a saleable product at the end of their treatment process or it may recover a low-value saleable
product. Further, in the organic fertilizer markets, our competitors are also able to capture ammonia but not stabilize it inexpensively
with CO2 as Bion is able to do, leading to higher production costs than we anticipate for our own product. As a result of this
‘double dip’ (being paid both to remove the ammonia, then to sell it as a fertilizer), we think this space should be a good
fit for Bion.

We believe food waste, food and beverage processing waste, and
meat and poultry slaughter/processing waste may be the best fit for our technology. Their wastewater streams are concentrated and have
similar characteristics to the animal waste stream our technology was developed to treat. Municipal wastewater treatment is much more
complex, owing to the wide variety of components/ contaminants in the waste stream, including PFAS (dissolved from plastics), siloxane
(chemical material from makeup and other personal products), pharmaceuticals, etc. Bion would need to conduct extensive pilots and trials
prior to entering the municipal space. For this reason, Bion has chosen at this time not to pursue ammonia control for municipal wastewater
as a source of feedstock for its fertilizers.

B) ANIMAL WASTE. According
to the American Biogas Council, there are more than 630 farms with biogas capture systems operating in the U.S. today, most of them on
dairy operations. The American Biogas Council, drawing on data from USDA and EPA's AgSTAR program, estimates that more than 11,000 additional
dairy, poultry, and swine farms have development potential. Bion's ARS was designed specifically for this market: to control ammonia from
manure waste and convert it into high-value byproducts.

In the U.S., post-AD animal waste digestate
is treated like raw animal manure and can be land-applied under a nutrient management plan. Absent a regulatory driver, there is no tolling
fee opportunity in the U.S., yet. While animal waste AD is not required to comply with point source discharge permits, in certain areas
like California, nutrient management budgets are stretched, and it is becoming increasingly difficult to find enough land to apply the
digestate. Many producers are proactively searching for alternative solutions to land application in anticipation of developing regulation.
Identifying those areas will be the key to success in this market.

We expect regulatory drivers to develop
in the U.S. on a regional basis initially, based on groundwater contamination and PM2.5 levels (see earlier discussion). The CA central
valley is one of the first places where PM2.5 levels could drive ammonia regulations and create that regulatory driver. More than a dozen
states have severe groundwater concerns, mostly related to agriculture. Groundwater contamination with nitrates is now viewed as a health
issue and is coming under increasing scrutiny. Recent trends in Michigan and California indicate they may soon begin to regulate animal
waste digestate in the same manner as any other industrial source, subject to groundwater permitting requirements.

CAFO Retrofit Opportunity

As one of the largest contributors to some of the
greatest air and water quality problems in America, it is clear that livestock waste cleanup represents one of the greatest opportunities
to achieve wholesale and meaningful improvements in U.S. air and water quality and to dramatically reduce the negative environmental impacts
from the food supply chain. Bion’s Gen3Tech platform can largely eliminate the environmental impacts of CAFOs. Bion’s technology,
coupled with its unique business model, enables the cleanup of the ‘dirtiest’ parts of the food supply chain: animal protein
production and generates value to help offset the costs of that cleanup. Cleaning up the livestock supply chain will be expensive and
will require subsidies and pathways to revenues from resource recovery. Bion’s management believes that CAFO cleanup, driven by
either regulation or incentive, is inevitable and that our technology, which was ‘purpose built’ for this challenge, will
play an important role in that cleanup.

The livestock industry and its markets are already
changing. With our commercial-ready technology and business model, Bion believes it has a first-mover advantage over others that will
seek to exploit the opportunities that will arise from the industry’s inevitable transformation. Bion anticipates moving forward
with the development of its initial commercial installation utilizing its ARS with the large Kimmeridge RNG Project, during the current
2026 calendar year. We believe that the success of this project will demonstrate not only the capabilities of Bion’s technology,
but the business model and value proposition that will support the cost of cleanup, as well. CAFO cleanup can be achieved and can provide
a pathway to true economic and environmental sustainability, with ‘win-win’ benefits for the livestock industry, the environment,
and the consumer. Bion intends to pursue the opportunity of CAFO cleanup and advocate for its implementation on a broad scale.

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Sustainable Beef

Bion believes there is an evolving opportunity to
provide sustainable production solutions to the cattle feeding industry. We believe we were too ‘early’ in our efforts to
establish integrated sustainable beef projects, but that the beef industry represents the best use of Bion’s system capabilities
and attributes. The beef industry today faces a wide range of challenges, from a fragmented commodity-producing industry with narrow margins
to antiquated and inefficient production practices that start with outdoor feedyards. Beef production and consumption is a primary target
of the global ‘anti-meat’ messaging campaign from consumer, investor, and environmental advocacy groups (and the industry’s
competitors in the alternative plant-based and cellular protein spaces). Bion believes there is an opportunity to produce truly sustainable
beef, certified by USDA, with dramatic, third-party verified reductions in the negative environmental effects by mitigating nutrient,
greenhouse gas, and other environmental impacts. To accomplish Bion’s goal, we will have to partner with producers and other technology
companies who provide solutions for different links of the beef value chain. A joint venture/strategic partner-focused business model
will be needed to deliver a premium sustainable product to the consumer and increased profitability up and down the supply chain.

At present, there is essentially no traceable and
verifiable ‘sustainable beef’ available to the US market, except for niche products. In response to consumer demand for transparency
and sustainability, Bion expects the meat industry in general, and beef specifically, to evolve towards new technologies and husbandry
practices to deliver these attributes. While we anticipate a faster adoption of tracking, verification and sustainability technologies
in other perishable food categories, like produce and dairy due to their shorter product cycles (and related harvest and production techniques),
meat industry leaders have also announced their willingness to move forward with initiatives in this area. Many companies have announced
‘sustainability’ initiatives, but most appear to consist largely of ‘greenwashing’ marketing commitments rather
than substantive undertakings at this date. Bion believes that substantial unmet demand currently exists – potentially very large
– for ‘real’ meat/dairy/egg products that offer the verifiable/believable sustainability consumers seek, but with the
taste and texture they have come to expect from American beef and pork, dairy and poultry. Numerous studies demonstrate the U.S. consumers’
preferences for sustainability and their ‘willingness to pay’ (WTP).

Bion‘s sustainable beef business model, based
on our Gen3Tech platform, can develop and operate large scale facilities that: a) utilize custom designed barns (which enable a more controlled
and monitored husbandry environment) and photovoltaic solar electricity generation utilizing the rooftops (where climate conditions permit),
b) with continual manure transfer to anaerobic digesters (“ADs”), c) which produce RNG and related environmental revenues,
and d) then channel the AD waste (including ammonia and CO2) through a series of processes to refine the waste into its various
components.

This overall business model unites several interrelated businesses
unlocked by Bion’s technology that augments and aggregates multiple revenue streams as described below. See “Technology
and Technology Platform” above for descriptions of the 4 major categories of products/revenue streams which Bion anticipates
from its Gen3Tech beef facilities: a) premium ‘sustainable branded’ beef, b) renewable energy and energy/environmental/carbon-related
credits, c) fertilizer products (organic and/or low carbon) and, potentially d) nutrient credits.

Recently there have been efforts to establish sustainable brands (including
USDA PVP certification) for a number of small-scale livestock producers (largely in the grass-fed beef category). At present, there is
essentially no traceable and verifiable ‘sustainable beef’ available to the US market except for niche products. In response
to consumer demand for transparency and sustainability, Bion expects the meat industry in general, and beef specifically, to evolve towards
using new technologies to deliver these attributes in their products. While we anticipate a faster adoption of tracking, verification
and sustainability technologies in other perishable food categories like produce and dairy, due to their shorter product cycles (and related
harvest and production techniques), meat industry leaders have also announced their willingness to move forward with initiatives in this
area. Many companies have announced meaningful ‘sustainability’ initiatives, but most appear to consist largely of ‘greenwashing’
marketing commitments rather than substantive undertakings at this date.

Some portion of sustainable beef will likely be organic (see below).

Sustainable Organic Beef

Bion believes it has a unique opportunity to produce,
at scale, affordable corn-fed/finished organic beef that is also certified as sustainable. In addition to the sustainable practices described
above, organic-sourced beef cows would be finished on organic corn, which would be produced using the ammonia nitrogen fertilizer captured
by the ARS. Bion believes organic finished beef will meet consumer demands with respect to sustainability and safety (organic) and also
provide the tenderness and taste American consumers have come to expect from premium conventional American beef that has been missing
in current organic beef products. Such products are largely unavailable in the market today. We believe Bion’s unique ability to
produce the fertilizer needed to grow a supply of relatively low-cost organic corn, and the resulting opportunity to produce organic beef,
will differentiate us from potential competitors.

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Today, organic beef demand is limited and mostly supplied
with grass-fed cattle. While organic ground/ chopped meat has enjoyed success in U.S. markets, grass-fed steaks have seen limited acceptance,
mostly resulting from consumer issues with taste and texture. In other words, it’s tough. Regardless, such steaks sell for a significant
premium over conventional beef. A grain-finished organic beef product is largely unavailable in the marketplace today due to the higher
costs of producing organic corn and grain. Bion believes there is a potentially large unmet demand for affordable beef products that are
both sustainable AND organic, but with the taste and texture consumers have come to expect from American beef. Bion’s ability to
produce the low-cost nitrogen fertilizer that can close the organic yield (and affordability) gap puts the Company in a unique, if not
exclusive, position to participate in JV’s that will benefit from this opportunity starting next year.

The Livestock CAFO Problem

The livestock CAFO industry is under tremendous pressure
from regulatory agencies, a wide range of advocacy groups, institutional investors and the industry’s own consumers, to adopt sustainable
practices. Environmental cleanup is inevitable and has already begun. Bion’s Gen3Tech was developed for implementation on large
scale livestock production facilities, where scale drives both lower treatment costs and efficient co-products production, as well as
dramatic environmental improvements. We believe that scale, coupled with Bion’s verifiable treatment technology platform, will create
a transformational opportunity to integrate clean production practices at (or close to) the point of production—the primary source
of the industry’s environmental impacts. Bion intends to assist the forward-looking segment of the livestock industry to bring animal
protein production in line with 21st Century consumer demands for meaningful sustainability.

In the U.S. (according to the USDA's 2022 Census of
Agriculture), there are more than 9.3 million dairy cows, approximately 88 million total cattle and calves, nearly 74 million hogs and
pigs, more than 9 billion broilers produced annually, and over 400 million layers, which provides an indication of both the scope of the
problem addressed by Bion’s technology, as well as the size of Bion’s opportunity in this space. Environmental impacts from
livestock production include surface and groundwater pollution, greenhouse gas emissions, ammonia, PM2.5, and other air pollution, excess
water use, and pathogens related to foodborne illnesses and antibiotic resistance. While the most visible and immediate problems are related
to nutrient runoff and its effects on water quality, the industry has recently been targeted by various stakeholder groups for its impacts
on climate change.

Estimates of total annual U.S. livestock manure waste
vary widely, but start around a billion tons, between 100 and 130 times greater than human waste. However, while human waste is generally
treated by septic or municipal wastewater plants, livestock waste – raw manure – is spread on our nation’s croplands
for its fertilizer value. Large portions of U.S. feed crop production (and most organic crop production) are fertilized, in part, in this
manner. Under current manure management practices, 80% or more of total nitrogen from manure, much of it in the form of ammonia, escapes
during storage, transportation, and during and after land application, representing both substantial lost value and socialized environmental
costs.

More than half of the nitrogen impacts from livestock
waste come from airborne ammonia emissions, which are extremely volatile, reactive and mobile. Airborne ammonia nitrogen eventually settles
back to the ground through atmospheric deposition - it ‘rains’ everywhere. While some of this nitrogen is captured and used
by plants, most of it runs off and enters surface waters or percolates down to groundwater. It is now well-established that most of the
voluntary conservation practices, such as vegetated buffers that ‘filter’ runoff (often referred to as “BMPs”
or “Best Management Practices” that have traditionally been implemented to attempt to mitigate nutrient runoff), are considerably
less effective than was previously believed to be the case. This is especially true with regard to addressing the volatile and mobile
nitrogen from ammonia emissions, because BMPs are primarily focused on surface water runoff, directly from farm fields in current production,
versus the re-deposition that takes place everywhere or groundwater flow.

Runoff from livestock waste has been identified in
most of our major watersheds as a primary source of excess nutrients that fuel algae blooms in both fresh and saltwater. Over the last
several years, algae blooms have become increasingly toxic to both humans and animals, such as the Red Tides on the Florida and California
coasts, and the Lake Erie algae bloom that cut off the water supply to Toledo, Ohio, residents in 2014. When the nutrient runoff subsides,
it leaves the algae blooms with no more ‘food’ and the blooms die. The algae’s decomposition takes oxygen from the water,
leading to ‘dead zones’ in local ponds, lakes, and ultimately, the Great Lakes, as well as the Chesapeake Bay, Gulf of Mexico,
and other estuary waters. Both the toxic algae blooms and the low/no-oxygen dead zones devastate marine life, from shrimp and fish to
higher mammals, including dolphins and manatees. U.S. EPA already considers excess nutrients “one of America’s most widespread,
costly and challenging environmental problems”. Nutrient runoff is expected to worsen dramatically in the coming decades due to
rising temperatures and increasing rainstorm intensity as a result of climate change.

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Nitrate-contaminated groundwater is of growing concern
in agricultural regions nationwide, where it has been directly correlated with nutrient runoff from upstream agricultural operations using
raw manure as fertilizer. Pennsylvania, Wisconsin, California and Washington, and others, now have regions where groundwater nitrate levels
exceed EPA standards for safe drinking water. High levels of nitrate can cause blue baby syndrome (methemoglobinemia) in infants and affect
women who are or may become pregnant, and it has been linked to thyroid disease and colon cancer. EPA has set an enforceable standard
called a maximum contaminant level (MCL) in water for nitrates at 10 parts per million (ppm) (10 mg/L) and for nitrites at 1 ppm (1 mg/L).
Federal regulations require expensive pretreatment for community water sources that exceed the MCL; however, private drinking water
wells are not regulated, and it is the owners’ responsibility to test and treat their wells. Additionally, groundwater flows also
transport this volatile nitrogen downstream where, along its way, it intermixes with surface water, further exacerbating the runoff problem.
Like atmospheric deposition, the current conservation practices relied on to reduce agricultural runoff are largely bypassed by this subsurface
flow.

Additionally, in arid climates such as California,
airborne ammonia emissions from livestock manure contribute to air pollution as a precursor to PM2.5 formation, small inhalable particulate
matter that is a regulated air pollutant with significant public health risks. Whether airborne or dissolved in water, ammonia can only
be cost-effectively controlled and treated at the source-- before it has a chance to escape into the environment where it becomes extremely
expensive to ‘chase’, capture and treat. While not regulated yet, there have been ongoing discussions between the US EPA and
the California Air Resources Board (CARB) about what potential ammonia regulations might encompass. However, as above, California is moving
forward with changes to how it deals with nitrates.

The livestock industry has recently come under heavy
fire for its impacts on climate change, which has become a rallying cry for the anti-meat campaigners. Estimates of the magnitude of those
impacts vary widely, but the general consensus is that globally, livestock account for 14.5 percent of greenhouse emissions. In the U.S.
however, that number drops to 4.2 percent, due to the increased efficiencies of American beef production. The greatest impacts come from
direct emissions of methane from enteric fermentation (belches), methane and nitrous oxide emissions from the manure, with arguably the
largest being the massive carbon footprint of the synthetic nitrogen fertilizers used to grow the grains to feed the livestock.

Chronic droughts in the west have also impacted the
long-term sustainability of some beef herds. Relocation of some beef cattle feeding locations may be required. Access to clean water is
an issue of concern that is rising in the world of risks on the ranch.

For decades the livestock industry has overlooked
and/or socialized its environmental problems and costs. Today, the impacts of livestock production on public health and the environment
can no longer be ignored and are coming under increasing scrutiny from environmental groups and health organizations, regulatory agencies
and the courts, the media, consumers, and activist institutional investors. The result has been a significant and alarming loss of market
share to plant-based protein and other alternative products. Bion’s Gen3Tech platform was designed to resolve these environmental
issues and bring the industry in line with twenty-first century consumer expectations.

Policy Change is Coming

Bion believes that policy change is coming. There
are many states that face livestock waste-related pollution issues, and they will be forced to adopt new strategies, as well. In the face
of a growing problem that will only be exacerbated by climate change, it will be necessary to go beyond status quo solutions or risk losing
the ecosystems that comprise many of our watersheds and estuaries. When regulation or competitively-bid markets for nutrient reductions
(and/or other forms of payment for ecosystem services that will allow us to monetize environmental benefits) become fully established,
Bion anticipates a robust opportunity to use its Gen3Tech-based platforms to retrofit both existing CAFOs and equip new large-scale livestock
facilities (“Projects”) which will generate the supplemental revenue needed to profitably afford technology implementation
from sales of verified nutrient reduction credits.

Bion's Gen3Tech can provide a solution to a significant
portion of the livestock problem discussed above, because it stabilizes and upcycles the nitrogen, providing a pathway to export and precision
apply it when and where needed, and preventing its uncontrolled release to the environment. Treatment costs are offset by recovering a
substantial portion of those nutrients for value-added commercial utilization. In contrast, the current clean water strategy being utilized
in the U.S. is clearly failing, because it doesn’t adequately address waste from agriculture. A lot of U.S. crops are now fertilized
with raw, untreated manure. However, approximately 80 percent of the nitrogen in that manure is not utilized by the plants being fertilized
but rather ‘escapes’ to contaminate the environment through various pathways.

Because livestock waste is one of the largest contributors
to nutrient problems in certain watersheds, livestock waste treatment can be the source of the low-cost solution for such problems –
if the waste is treated upstream at (or close to) the source of production. Manure control technologies, applied to large scale facilities
where concentration and scale enable cost-effective cleanup, can potentially offer the lowest cost nutrient solutions available in most
watersheds today. More than 80 percent of U.S. livestock production takes place on large-scale facilities, where cost-effective treatment
can be implemented. There is no longer any real question regarding whether such facilities need to be cleaned up. The actual question
for public policy concerns is developing sources of new revenues which will enable the livestock industry to offset the implementation
costs for the cleanup.

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Despite trends toward consolidation in segments over
the last several decades, the U.S. animal-protein industry, particularly beef, remains (in large part) a fragmented, low-margin commodity
business without effective integrated efforts toward either environmentally or economically sustainable production. Cleaning it up will
have to be orderly and contain a path to sustainability that does not cause U.S. food costs to spike or bankrupt the industry. This will
require treatment sufficient to remove the volume of nutrients in excess of crop requirements. Because the global export market represents
a significant part of the U.S. livestock production industry, direct increases in federal regulation without offsetting revenues would
likely create costs that could not be absorbed by the industry in a manner that would allow it to remain competitive in international
markets. Selective state regulation would have a similar chilling effect within the U.S., since regulated producers in one state would
be unable to compete with unregulated producers in adjoining states. Subsidies and/or new revenue sources are required.

Bion believes that reallocating some part of the more
than $175 billion in existing U.S. taxpayer-funded clean water spending to lower-cost alternative solutions in agriculture (including
competitively-bid nutrient reduction procurement) is inevitable. It will provide the taxpayer with accelerated and substantially lower-cost (and
verified) air and water quality solutions compared to current strategies. If Bion’s technology is implemented in appropriate
situations, it will provide the livestock industry with the recurring revenues that are needed to offset the costs of technology adoption
without major disruption to the industry. To date, a wide range of entrenched interests have opposed and fought policy change that might
reallocate clean water spending to more cost-effective alternatives; but this common-sense approach is being accepted by a widening group
of stakeholders.

Bion spent many years pursuing these opportunities
in Pennsylvania, including developing and demonstrating its technology as part of the efforts to clean up the Chesapeake Bay Watershed.
Bion’s activities in PA commenced with the Kreider 1 2G Tech dairy system in the Chesapeake Bay watershed in 2008 and continued
through 2019. For more information on Bion’s activities related to Pennsylvania, the Chesapeake Bay, and nutrient credits and
trading, please see Bion’s Form 10-K, for the year ended June 30, 2023. (and prior years).

Going Concern:

The Company’s consolidated financial statements
have been prepared assuming the Company will continue as a going concern. The Company incurred a net loss of $1,958,000 and $2,380,000
for the years ended June 30, 2026, and 2025, respectively. At June 30, 2026, the Company has a working deficit and a stockholders’
equity of approximately $7,264,000 and $7,192,000, respectively. The Company’s lack of revenue and/or operating profits, together
with the low likelihood of generating positive cash flow and/or net income during the next 12-24 months, raise substantial doubt about
the Company’s ability to continue as a going concern.

For more detail regarding Going Concern, including
Management’s Plans, see Note 1 of Notes to Financial Statements below.

PRINCIPAL PRODUCTS AND SERVICES

The Company’s focus is on implementing its Gen3Tech
in JVs (as described above). Therefore, the category ‘PRINCIPAL PRODUCTS AND SERVICES’ is not applicable for the Company’s
business. While the Company may implement some ARS or Gen3Tech systems on a contractual basis, and may, in the future, license or otherwise
deploy our ARS as a standalone ammonia control solution, at this time our business does not involve the sale of our systems (or equipment)
or long term direct operations/management of our systems (or equipment).

CORPORATE BACKGROUND

The Company is a Colorado corporation organized on
December 31, 1987. Our principal executive offices are located in the home offices of our senior executives. Our primary administrative
office is now located at the residence of our Office Manager at 9 East Park Court, Old Bethpage, New York 11804, at which location most
of the Company’s physical records and central computer reside. Our primary telephone number is 406-839-0816. We have no additional
offices at this time as all employees and primary consultants work from their home offices.

HISTORY AND DEVELOPMENT OF OUR BUSINESS

Substantially all of our business and operations to
date has been conducted through wholly-owned subsidiaries, Bion Technologies, Inc. (a Colorado corporation organized September 20, 1989),
Bion Integrated Projects Group, Inc. ("Projects Group") (formerly Bion Dairy Corporation through August 2008 and originally
Bion Municipal, Inc., a Colorado corporation organized July 23, 1999) and Bion Services Group, Inc. ("Services Group") (formerly
Bion International, Inc., a Colorado corporation organized July 23, 1999) and BionSoil, Inc. (a currently inactive Colorado corporation
organized June 3, 1996). Bion is also the parent of Bion PA 2 LLC (a Colorado entity organized June 24, 2010) (“PA2”) and
Bion 3G-1, LLC (a Colorado entity organized on September 23, 2021). In January 2002, Bion entered into a series of transactions whereby
the Company became a 57.7% (now 58.9%) owner of Centerpoint Corporation (a Delaware corporation organized August 9, 1995) ("Centerpoint").
Bion was formerly the parent of Bion PA 1 LLC (a Colorado entity organized August 14, 2008) (“PA1”) which was dissolved on
December 29, 2021.

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We have conducted business in the livestock manure
and organic waste treatment arena since 1989; we are finalizing our fourth generation of technology. Our original systems were wastewater
treatment systems for dairy farms and food processing plants. The basic design was modified in late 1994 to create our first generation Nutrient
Management Systems ("NMS") that produced organic soil amendment products as a byproduct of remediation of the waste stream when
installed on large dairy or swine farms. Through June 30, 2002, we sold and subsequently installed approximately 30 of these systems in
7 states. While they achieved their nutrient management objectives, there was no mandate to force CAFO clean up and the byproducts did
not produce enough value to drive a business opportunity.

Bion’s second-generation technology was developed
over the next several years and largely completed by 2008. It allowed real-time digital control and process monitoring and created higher
value products. While the second-generation platform was never placed in commercial service, it ultimately led to the conception and development
of the third-generation Ammonia Recovery System, beginning in 2015. Pilot testing began in Buffalo, NY, in 2019; construction of the small
commercial scale Initial Project at Fair Oaks, IN, was completed in 2023; optimization was completed in 2025 after 1,500 hours of operation.

For more information on the history of Bion’s
evolving business opportunity and technology development, please see Bion’s Form 10-K, for the year ended June 30, 2025. (and prior
years).

Up until 2025, Bion was largely focused on implementing
its technology in the beef cattle industry, where it would be required to change consumer habits, supply chain structure, and manage and
finance complex projects with long lead times. In 2025, management put that aside to focus on what it believed to be more achievable goals.
Bion’s core ARS technology and the Gen3Tech platform and business model it supports create three distinct, but related, opportunities
for Bion and its strategic partners to exploit: 1) standalone ammonia control for industrial or livestock waste biogas production, and
2) retrofit/cleanup of existing CAFOs to mitigate environmental impacts, 3) the transition to sustainable and sustainable-organic beef.

The first opportunity – standalone ammonia control
– is here today and what Bion is focused on at this time. We have determined that the ARS has many applications in the industrial
sector, in addition to agriculture. There is a ‘sweet spot’ (a combination of source, concentration, and solids content) where
the ARS can provide cost-effective solutions, especially for food waste and food processing waste, including livestock packing/ slaughter
waste. Once Bion is sufficiently funded and staffed to adequately address the standalone opportunity, the Company will decide how best
to proceed with both the CAFO cleanup and sustainable beef opportunities.

COMPETITION:

There are a significant number of potential competitors
in the industries in which Bion is working: livestock and industrial waste treatment, renewable energy production, and fertilizer manufacturing.
There is a small, but increasing number of visionary companies, like Bion, that seek to develop integrated projects that exploit the synergies
of these industries, with circular solutions such as integrated sustainable and/or organic beef production and comprehensive CAFO treatment
that includes resource recovery and upcycling.

Bion has further differentiated itself from these
companies with its Intellectual Property (IP) that protects its ability to stabilize the ammonia in organic waste with CO2,
allowing us to produce an OMRI listed ammoniacal nitrogen fertilizer product that is 8 to 10 times more valuable than conventional (non-organic)
ammoniacal nitrogen. While the ability to produce ammoniacal nitrogen is not unique, there are very few ways it can be done and maintain
that organic designation. Bion believes its process to be the lowest cost, which has been confirmed by third parties. Bion also believes
its process to be the most reliable, since others depend on either complex biological processes or rely on outside acids to stabilize
the ammonia – those acids are subject to commodity pricing. Reliability is an important distinction as the organic fertilizer industry
has grown skeptical of promises of supply that have been made by a number of technology companies that ultimately failed to deliver. Between
Bion’s value proposition to biogas producers, coupled with its low cost and reliability for growers, Bion is confident it is well
positioned to compete in these evolving market opportunities and, subject to the availability of project financing, will be able to choose
the most attractive potential projects.

There is a tremendous amount of competition in the
space to generate biogas or RNG from industrial and municipal waste streams. In some cases with challenging economics, overall project
feasibility will rely on the value of the recovered ammonia. Bion is focused on the evolving opportunities to provide ammonia control
for these projects, especially food waste and food and beverage processing waste, including slaughter waste. As a bolt-on ammonia control
solution that is unique and presents a strong value proposition to the biogas operator, we believe some of our competitors will become
customers.

Because Bion systems offer a unique and meaningful
value proposition, it has the ability to be competitive in each of the spaces it intends to exploit its opportunities.

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DEPENDENCE ON ONE OR A FEW MAJOR CUSTOMERS

In our JVs/Projects (including Integrated Projects)
business segment, we will most likely be dependent upon one or a few major customers/partners/joint venturers since a relatively limited
number of JVs and/or Projects (including Integrated Projects) will be developed by the Company. We anticipate initially developing, owning
interests in, and operating only one or a small number of Projects commencing during 2026 and, thereafter, developing a limited number
of Projects at a time. Thus, at least for the near future, our revenues will be dependent on a relatively small number of major Projects,
participants and/or customers.

PATENTS

We are the sole owner of six United States patents.
Additionally, Bion has one United States patent applications pending and has two international patent applications currently pending.

Patent Numbers and date of issue:

United States Currently Issued:

(1) 8,287,734: Method for Treating Nitrogen in Waste Streams:
(OCN) Jere Northrop & James W. Morris (Exp 3/20/31)

(2) 10,106,447: Process to Recover Ammonium Bicarbonate from
Wastewater: Morton Orentlicher & Mark M. Simon. (Exp. 9/14/2035)

(3) 10,604,432: Process to Recover Ammonium Bicarbonate
from Wastewater; Dominic Bassani, Steve Pagano, Morton Orentlicher & Mark M. Simon. (Exp 6/29/2037)

(4) 10,793,458: Process to Recover Ammonium Bicarbonate from
Wastewater; Dominic Bassani, Steve Pagano, Morton Orentlicher & Mark M. Simon. (Exp 9/14/2035)

(5) 11,254,581: Process to Recover Ammonium Bicarbonate from
Wastewater; Dominic Bassani, Morton Orentlicher, Mark M. Simon & Steve Pagano. (Exp 9/14/2035)

(6) 11,858,823: Process to Recover Ammonium Bicarbonate from
Wastewater; Dominic Bassani, Morton Orentlicher, Mark M. Simon & Steve Pagano. (Exp 9/14/2035)

We are also the sole owner of, or possess the contractual
right to acquire exclusive patent rights to, a pending United States provisional patent application, a pending United States utility patent
application and three international applications as set forth below:

United States Currently Pending:

(1) 18/390,274: Process to Recover Ammonium Bicarbonate from
Wastewater; Dominic Bassani, Steve Pagano, Morton Orentlicher & Mark M. Simon

International Applications Currently Pending:

(1) EP 18943551.4: Process to recover ammonium bicarbonate from
wastewater; Dominic Bassani, Steve Pagano, Morton Orentlicher & Mark M. Simon.

(2) MX/a/2021/007358: Process to recover ammonium bicarbonate
from wastewater; Dominic Bassani, Steve Pagano, Morton Orentlicher & Mark M. Simon

In addition to such factors as innovation, technological
expertise and experienced personnel, we believe that a strong patent position is critically important to compete effectively in the businesses
on which we are focused. It is likely that we will file applications for additional patents in the future. There is, however, no
assurance that any such patents will be granted.

The Company has elected to expense all costs and filing
fees related to obtaining patents (resulting in no related asset being recognized in the Company’s consolidated balance sheets)
because the Company believes such costs and fees are immaterial (in the context of the Company’s total costs/expenses) and have
no direct relationship to the value of the Company’s patents.

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It may become necessary or desirable in the future
for us to obtain patent and technology licenses from other companies relating to technologies that may be employed in future products
or processes. To date, we have not received notices of claimed infringement of patents based on our existing processes or products,
but due to the nature of the industry, we may receive such claims in the future.

We generally require all of our employees and consultants,
including our management, to sign a non-disclosure and invention assignment agreements upon employment with us.

RESEARCH AND DEVELOPMENT

Current research and development work is focused on
ongoing improvement of our ARS (the initial version of which is ready for implementation in an appropriate Project) and Gen3Tech, with
emphasis on increased recovery of valuable co-products (including nutrients in organic and/or non-organic forms, production of renewable
energy, with related renewable energy and/or environmental credits). Bion believes its Gen3Tech will produce significantly greater value
from the CAFO waste stream through the recovery of a concentrated natural nitrogen fertilizer and pipeline-quality natural gas. Bion
is focused on development of a fourth-generation ARS to provide standalone ammonia control solutions at facilities that recover biogas
from organic waste streams. The 4G system will enjoy dramatically lower costs, both in capex and opex.

During the years ended June 30, 2026, and June 30,
2025, respectively, we expended approximately $27,000 and $22,000 excluding non-cash stock-based compensation) on research and development
activities related to our technology platform applications in support of large-scale, economically and environmentally sustainable Projects
and Retrofits. Since the 2018 fiscal year, Bion’s research and development has been primarily focused on development work to complete
and further refine development of our Gen3Tech which will have the capacity to process dry, poultry CAFO waste streams in addition to
wet dairy/beef/swine CAFO waste streams and increase our ability to recover marketable by-products from the waste stream remediation including
renewable natural gas and nitrogen products (organic and non-organic). Some work has also involved modifying and adding unit processes
to our Gen3Tech platform with the objective of reducing capital costs and operating costs, while generating commercial equivalent by-products
(and therefore, potential revenue streams) and significantly increasing environmental efficiency. As a result of these efforts (including
their continuation during the current period), Bion made new (and supplemental) patent filing(s) during the 2019-2021 fiscal years related
to our ARS.

Our current research
and development efforts have been focused on developments that will minimize water removal requirements, thereby significantly reducing
the associated energy costs of operating the ARS. In addition,
current efforts are focused on fertilizer and soil amendment products (organic and inorganic), water reuse, environmental and reduction
credits (including but not limited to nutrient, carbon, sediment, water and pathogen reduction) while reducing capital costs and operating
costs. Bion continues to focus on “normalizing” its technology platform for use on multiple species. This effort has required
significant work and resource allocation on research regarding balancing the activities of each unit process so that its output enables
the subsequent unit processes to maximize efficiency and discharge to the subsequent unit process in order to produce a feedstock cost
effectively. The by-products of this series of unit processes (which include certain Bion proprietary elements) are then “reassembled”
into products to maximize their economic value. To date, research and development results have supported our objectives.

Environmental Protection/Regulation and Public
Policy

In regard to Retrofits and development of Projects,
we will be subject to extensive environmental (and other) regulations related to CAFO's, biofuel production and end product (e.g. fertilizer)
producers. To the extent that we are a provider of systems and services to others that result in the reduction of pollution, we
are not under direct enforcement or regulatory pressure. However, we are involved in the business of CAFO and industrial waste treatment
and are impacted by environmental regulations in at least four different ways:

• Our marketing and sales success is partly reliant on the pollution clean-up
requirements of various governmental agencies, from the Environmental Protection Agency (EPA) at the federal level to state and local
agencies;

• Our System design and performance criteria must be responsive to the changes
in federal, state and local environmental agencies' effluent and emission standards and other requirements;

• Our System installations and operations require governmental permits and/or
other approvals in many jurisdictions; and

• To the extent we own or operate Projects (including Integrated Projects
with CAFO facilities and ethanol plants), those facilities will be subject to environmental regulations.

Additionally, our activities are affected by many
public policies and regulations (federal, state and local) related to other industries such as agriculture, food, energy, municipal waste
and storm water treatment, watershed-wide mandates, and others. For example, the existing differences in the regulatory requirements for
agriculture versus municipal wastewater clean-up currently in place have negatively impaired the development of viable markets for nutrient
reduction credits.

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Bion system installations and operations may require
verification and compliance with an assortment of voluntary regulatory programs, such as the USDA Organic and USDA Process Verified branding
programs. Each of these programs has a series of compliance verification steps that need to be met in order to maintain proper standing
for use of the USDA shield on packaging.

EMPLOYEES

As of September 1, 2026, we had six employees and
primary consultants, all of whom are performing services for the Company on a full-time basis. The Company utilizes another half-dozen
key consultants and professionals on an ‘as needed’ or part-time basis for now, but we expect most of them to join Bion as
employees as we enter commercialization. Our future success depends significantly on the continued service of our key personnel and the
ability to hire additional qualified personnel. The competition for highly qualified personnel is intense, and there can be no assurance
that we will be able to retain our key managerial and technical employees or that we will be able to attract and retain additional highly
qualified technical and managerial personnel in the future. None of our employees is represented by a labor union, and we consider our
relations with our employees to be good. None of our employees is covered by "key person" life insurance.