What changed in this filing

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Item 1. Business

2021-09-29 compared with 2020-09-22 · 1658 added, 1819 removed, 145 unchanged (96% of the section changed)

Bion Environmental Technologies, Inc.'s ("Bion,"

Bion Environmental Technologies, Inc.

("Bion,"

"Company,"

1 unchanged sentence

"Us,"

or "Our") patented and proprietary technology provides comprehensive

environmental solutions to one of the greatest water air and water quality problems in the U.S.

pollution from large-scale

livestock production facilities (also known as “Concentrated Animal Feeding Operations”

or ”CAFOs").

Application of our technology and technology platform can simultaneously remediate environmental problems and improve operational/resource

efficiencies by recovering value high-value co-products from the CAFOs’

waste stream that has traditionally been wasted or

underutilized, including renewable energy, nutrients (including ammonia nitrogen and phosphorus) and water.

From 2016 to present,

the Company has focused a large portion of its activities on developing, testing and demonstrating the 3rd generation of its technology

and technology platform (“3G Tech”) with emphasis on increasing the efficiency of production of valuable by-products

of its waste treatment including ammonia nitrogen in the form of organic ammonium bicarbonate products.

The Company’s initial

ammonium bicarbonate liquid product completed its Organic Materials Review Institute (“OMRI”) application and review

process with approval during May 2020.

(See discussion at “Organic Fertilizer products”

The Company believes that, in addition to providing

superior environmental remediation, its 3G Tech will create the opportunity for large scale production of sustainable and/or organic

branded livestock products that will command premium pricing (in part due to ongoing monitoring and third party verification of

environmental performance to provide meaningful assurances to both consumers and regulators).

As co-products, our 3G Tech will

produce valuable organic fertilizer products which can be:

a) utilized in the production of organic grains for use as feed in support

of joint venture Projects (“JVs”) raising organic livestock, and/or b) marketed to the growing organic fertilizer market.

Our 3G Tech patented technology was developed to be part of a comprehensive technology platform that could generate multiple present

and projected future revenue streams to offset the costs of technology adoption.

Bion’s technology platform includes onsite

monitoring and data collection as well as independent 3 rd party verified lab data confirming the environmental reduction

The third party verified data regarding the environmental impact reductions will also be used to qualify the final consumer

products (livestock protein—including meat, eggs and dairy products) for a US Department of Agriculture (“USDA”)

“Environmentally Sustainable”

or "Our") was incorporated in 1987 in the State of Colorado.

Our patented and proprietary technology provides economically

sustainable comprehensive environmental solutions to one of the greatest water air and water quality problems in the U.S.

from large-scale livestock production facilities (also known as “Concentrated Animal Feeding Operations”

or “CAFOs”).

Application of our technology and technology platform can simultaneously mitigate environmental problems and improve operational/resource

efficiencies by recovering high-value co-products from the CAFOs’

waste stream that have traditionally been wasted or underutilized,

including renewable energy, nutrients (including ammonia nitrogen and phosphorus) and water.

During the 2016 to 2021 fiscal years, the Company

focused a large portion of its activities on developing, testing and demonstrating the 3rd generation of its technology and technology

platform (“3G Tech”) with emphasis on increasing the efficiency of production of valuable co-products from the waste treatment

process, including ammonia nitrogen in the form of organic ammonium bicarbonate products.

The Company’s initial ammonium bicarbonate

liquid product completed its Organic Materials Review Institute (“OMRI”) application and review process with approval during

An application for our first solid ammonium bicarbonate product –

AD Nitrogen –

has been filed and is in the review

process (see discussion at “Organic Fertilizer products”

Bion is now focused primarily on:

i) development/construction

of its initial commercial-scale 3G Tech installation, ii) developing applications and markets for its organic fertilizer products and

its sustainable (conventional and organic) animal protein products, and iii) initiation and development of joint ventures (“JVs”

as discussed below) (and related projects) and strategic relationships based on the augmented capabilities of our 3G Tech, while (iv)

continuing to pursue business opportunities related to large retrofit projects (such as the Kreider poultry project JV described below)

and (vi) ongoing R&D activities.

The $175 billion U.S.

livestock industry is

under intense scrutiny for its environmental and public health impacts –

its ‘environmental sustainability’--

at the same time it is struggling with declining revenues and margins (derived in part from clinging to its historic practices

and resulting impacts).

Its failure to respond to consumer concerns ranging from food safety to its ‘socialized’

environmental

impacts have provided impetus for plant-based alternatives such as Beyond Meat and Impossible Burger providing “sustainable”

alternatives to this growing consumer segment of the market.

The plant-based threat to the livestock industry market (primarily

beef and pork) has succeeded in focusing the large scale livestock production facilities (also known as “Concentrated Animal

Feeding Operations”

or “CAFOs") on how to meet the plant-based market challenge by addressing the consumer sustainability

The adoption of livestock waste treatment technology by industry segments is largely dependent upon adoption generating

sufficient revenues to offset the capital and operating costs associated with technology adoption.

We believe that Bion’s 3G Tech platform,

coupled with common-sense policy changes to U.S.

clean water strategy that are already underway, will combine to provide a pathway

to true economic and environmental sustainability with ‘win-win’

benefits for at least a premium sector of the livestock

industry, the environment, and the consumer.

Bion’s business model and technology

can open up the opportunity for JVs (in various contractual forms) between the Company and large livestock/food/fertilizer industry

participants, based upon the supplemental cash flow generated by implementation our 3G Tech business model (described and discussed

below) which will support the costs of technology implementation (including related debt).

We anticipate this will result in long

term value for Bion.

Long term, Bion anticipates that the sustainable branding opportunity may expand to represent the single largest

contributor to the economic opportunity provided by Bion.

During 2018, the Company had its first patent

issued on its 3G Tech and has continued its work to expand its patent coverage for our 3G Tech.

In August 2020, the Company received

a Notice of Allowance on its third patent which significantly expands the breadth and depth of the Company’s 3G Tech coverage.

(See “Patents”

The 3G Tech platform has been designed to maximize the value of co-products produced during

the waste treatment/recovery processes, including pipeline-quality renewable natural gas and organic commercial fertilizer products.

All processes will be verifiable by third-parties (including regulatory authorities, certifying boards and consumers) to comply

with environmental regulations and trading programs and meet the requirements for:

a) renewable energy credits, b) organic certification

of the fertilizer coproducts and c) the USDA PVP ‘Environmentally Sustainable’

branding program (See discussion below.)

Bion anticipates moving forward with the development process of its initial commercial installations of its 3G technology during

the 2021 (current) and 2022 fiscal years.

In parallel, Bion has worked (which work continues)

to advance public policy initiatives that will potentially create markets (in Pennsylvania and other states) that will utilize

taxpayer funding for the purchase of verified pollution reductions from agriculture (“credits”) by the state (or others)

through a competitively-bid procurement programs.

livestock industry is under

intense scrutiny for its environmental and public health impacts –

its ‘environmental sustainability’-- at the same

time it is struggling with declining revenues and margins (derived in part from clinging to its historic practices and resulting limitations

and impacts) which threaten its ‘economic sustainability’.

Its failure to adequately respond to consumer concerns ranging

including food safety, environmental impacts, and humane treatment of animals have provided impetus for plant-based alternatives such

as Beyond Meat and Impossible Burger (and many others) being marketed as “sustainable”

alternatives for this growing consumer

segment of the market.

The Company believes that its 3G Tech, in addition

to providing superior environmental remediation, creates opportunities for large scale production of:

i) verifiably sustainable-branded

livestock products and ii) verifiably sustainable organic-branded livestock products that will command premium pricing (in part due to

ongoing monitoring and third-party verification of environmental performance which will provide meaningful assurances to both consumers

and regulatory agencies).

Each of these two distinct market segments (which the Company intends to pursue in parallel) presents a large

production/marketing opportunity for Bion.

Our 3G Tech platform will also produce revenues from co-products:

i) pipeline quality biogas

(and related environmental credits) and ii) valuable organic fertilizer products, which can be utilized in the production of organic grains

for use as feed for raising organic livestock (some of which may be utilized in the Company’s JV projects) and/or marketed to the

growing organic fertilizer market.

During late September 2021, Bion entered into a lease

for the development site of its initial commercial scale 3G Tech project in September 2021(“Initial Project”), which Initial

Project will be located on approximately four (4) acres of leased land near Fair Oaks, Indiana.

Terms for an additional related agreement

regarding disposal of certain manure effluent have been agreed upon with the Curtis Creek Dairy unit of Fair Oaks Farms (“FOF”)

and the Company expects the agreement to be finalized by the end of the first full week of October 2021.

Design and pre-development work

commenced during August 2021 and preparation for active surveying, site engineering and other work is now underway.

The Initial Project

will be an environmentally sustainable beef cattle feeding facility, equipped with state-of-the-art housing and Bion’s 3G-Tech platform

to provide waste treatment and resource recovery.

Bion has designed the project to house and feed approximately 300 head of beef cattle.

The facility will include Bion’s 3G Tech platform including:

i) covered barns with solar photovoltaic generation, ii) anaerobic

digestion for renewable energy recovery;

iii) livestock waste treatment and resource recovery technology;

iv) Bion’s ammonium bicarbonate

recovery and crystallization technology and iv) data collection software to document system efficiencies and environmental benefits (with

the Bion 3G Tech facilities capable of treating the waste from approximately 1,500 head).

The facility will be large enough to demonstrate

engineering capabilities of Bion’s 3G Tech at commercial scale, but small enough that it can be constructed and commissioned quickly,

with operations targeted to commence sometime during the Spring of 2022.

This project is not being developed at economic commercial scale

or with an expectation of profitability due to its limited scale.

However, successful installation, commissioning, and operations will

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.

Specifically, the Initial Project is being

developed to provide and/or accomplish the following:

Proof of 3G Tech platform scalability

- Document system efficiency and environmental

benefits and enable final engineering modifications to optimize each unit process within the Bion 3G technology platform.

- Environmental benefits will include (without

limitation) renewable energy production (natural gas recovery from AD and solar electric from integrated roof top photovoltaic generation);

nutrient recovery and conversion to stable organic fertilizer;

pathogen destruction;

water recovery and reuse;

air emission reductions.

Use Bion’s data collection system to support 3 rd party verified system efficiency requirement to qualify for USDA

Process-Verified-Program (PVP):

certification of sustainable branded beef (and potentially pork) product metrics.

Produce sufficient ammonium bicarbonate nitrogen fertilizer (“AD Nitrogen”) for commercial testing by potential joint

venture partners and/or purchasers and for university growth trials.

Produce sustainable beef products for initial test marketing efforts.

Upon achieving optimized and steady-state operations

at the Initial Project during 2022, coupled with obtaining an OMRI listing for its AD Nitrogen product, Bion expects to be ready to move

forward with its plans for development of much larger facilities.

The Company anticipates that discussions and negotiations regarding

potential JVs with strategic partners in the financial and livestock industries to develop large scale projects will commence during the

construction of the Initial Project.

Additionally, the Company believes there will also be opportunities to proceed with selected ‘retrofit

projects’

of existing facilities (see ‘Retrofit 3G Tech Project:

Kreider Poultry JV below as an example).

Bion intends to move forward on its one of its primary

commercial goals:

establishing JV’s for large scale projects that will produce both sustainable and sustainable-organic corn-fed

The products will be supported by a USDA PVP-certified sustainable brand that will, initially, highlight reductions in carbon and

nutrient footprint, as well as pathogen reductions associated with foodborne illness and antibiotic resistance, along with the organic

designation where appropriate.

Bion has successfully navigated the USDA PVP application process previously, having received conditional

approval of its 2G Tech platform, pending resubmission and final site audits, and is confident it will be successful in qualifying its

3G Tech platform.

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.

For example, a 2019

NYU Stern’s Center for Sustainable Business study (https://hbr.org/2019/06/research-actually-consumers-do-buy-sustainable-products )

concluded that ‘products marketed as sustainable

grew 5.6 times faster than those that were not…’

and that ‘…in more than 90 percent of consumer-packaged-goods

(CPG) categories, sustainability-marketed products grew faster than their conventional counterparts.’

Sales growth of plant-based

alternatives, including both dairy and more recently ground meat (Beyond Meat, Impossible Foods, et al) have shown that a certain segment

of consumers are choosing seemingly sustainable offering, and are also willing to pay a premium for it.

Numerous studies also support

the consumers’

‘willingness-to-pay’

(WTP) for sustainable choices, including a recent meta-analysis of 80 worldwide

studies with results that calculate the overall WTP premium for sustainability is 29.5 percent on average (https://www.sciencedirect.com/science/article/abs/pii/S019566632100146X

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, at scale, represents one of the greatest

opportunities we have to reduce negative environmental impacts of the food supply chain on air and water quality.

Bion’s 3G Tech

platform, along with its business model, enables the cleanup of the ‘dirtiest’

part of the food supply chain:

animal protein

production and creates the opportunity to produce and market verifiably sustainable organic and conventional ‘real meat’

that can participate in the growth and premium pricing that appears to be readily available for the ‘right’

Bion believes the at least a premium segment of the

US beef industry (and potentially other livestock industry groups) is at the doorstep of a transformative opportunity to address the growing

demand for sustainable food product offerings, while pushing back against today’s anti-meat messaging.

At $66 billion/year (2021

retail value), the beef industry is a fragmented, commodity industry whose practices date back decades.

In 1935 inflation-adjusted terms,

beef is 63% more expensive today, while pork and chicken, which are now primarily raised in covered barns, at CAFOs with highly integrated

supply chains, are 12% and 62% cheaper, respectively.

In recent years, the beef industry has come under increasing fire from advocacy

groups, regulatory agencies, institutional investors, and ultimately, their own consumers, over concerns that include climate change,

water pollution, food safety, and the treatment of animals and workers.

Advocacy groups targeting livestock and the beef industry

have recently been joined by competitors that produce animal protein alternatives in seeking to exploit the industry’s environmental

and economic weaknesses.

Their global anti-meat messaging has had a substantial chilling effect on the relationships the beef industry

has with its institutional investors;

retail distributors, such as fast-food restaurants;

and mostly, its consumers.

Led by the United

Nations Food and Agriculture Organization, a coordinated anti-meat messaging campaign has targeted consumers worldwide, primarily focused

on the industry’s impacts on climate change.

Meat alternatives, especially plant-based protein producers like Beyond Meat and Impossible

Foods, are being heavily promoted by themselves and the media, and have enjoyed steady sales growth.

A 2018 NielsenIQ Homescan survey

last year found that 39% of Americans are actively trying to eat more plant-based foods.

Some of the recent growth in plant-based proteins

results from increasing lactose intolerance and other health concerns;

however, most of that growth is attributed to consumers’

growing concerns for the environmental impacts of real meat and dairy.

Several large US companies that have traditionally focused on livestock

production, including Cargill, ADM, Perdue Foods, and Tyson, have recently entered the plant protein space.

In terms of changing customer

preferences, ‘saving the planet’

has proven to be a more compelling argument than the traditional animal activism/ welfare

To date, the only ‘industry response’

to this has been grass-fed beef, which is regarded as a generally more sustainable

offering than grain-fed.

However grass-fed beef has had only limited acceptance in U.S.

markets, because it is less flavorful and tougher

than the traditional corn-fed beef consumers have grown to enjoy.

It should be noted that these plant-based protein

producers are primarily expected to be able to serve the ground/ processed meat market, which represents only about 10 percent of the

overall animal protein market.

Further, there has recently been pushback to these plant-based products, focusing on their highly processed

nature and unproven health benefits, scalability/ pricing, and their uncertain carbon footprint.

There have also been several companies

recently enter the cellular and 3D-printed meat arena.

While facing myriad challenges and further out on the development timeline, some

people believe cellular agriculture (aka cultured, clean, lab-grown, cultivated) meat may have the potential to service a much larger

percentage of the market than plant-based protein, including cuts like steaks, chops and roasts, but the likely cost remains very uncertain

at this point.

Each of these items supports Bion’s belief that

there is a potentially very large opportunity to supply premium sustainable beef products that satisfy these concerns.

We believe that

the real meat/beef products that can be cost-effectively produced today using our 3G Tech platform, both sustainable and/or organic, can

provide an affordable product that satisfies the consumer’s desire for sustainability, but with the superior taste and texture those

consumers have grown to prefer.

Sustainable Beef

Bion’s goal is to be first to market with meaningfully

sustainable, and verified, beef products that can be produced at sufficient scale to service national market demand.

The cattle produced

at a Bion facility will enjoy a substantially lower carbon footprint, dramatically reduced nutrient impacts to water, and an almost total

pathogen kill in the waste stream.

A Bion sustainable beef facility will be comprised of covered barns with slotted floors, which allow

the waste to pass through and be collected quickly and frequently to reduce ammonia volatilization and loss, as well as odors.

barns will reduce weather impacts on the livestock and have been demonstrated to promote improved general health and weight gain in the

cattle housed in them.

The barns represent a very large roof surface area, which will be utilized in appropriate geographical locations

for the installation of solar generation systems to produce electricity for the facility, as well as export to the grid.

Waste treatment

and resource recovery will be provided by Bion’s advanced 3G Tech platform, which Bion believes offers the most comprehensive solution

for livestock waste available today.

In addition to direct environmental benefits (described in more detail in Part I, Item 1 “Business”)

every pound of nitrogen that is captured, upcycled, and returned to the agricultural nitrogen cycle as high-quality fertilizer (vs lost

to contaminate downstream waters), is also a pound of nitrogen that will not have to be produced as synthetic urea or anhydrous ammonia,

with their tremendous carbon cost.

System performance and environmental benefits will be monitored and verified through third parties,

with USDA PVP certification of the sustainable brand that Bion also believes will be the most comprehensive available in the market.

Sustainable Organic Beef

Bion believes it has a unique opportunity to produce,

at scale, affordable corn-fed organic beef that is 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 ammonium bicarbonate fertilizer captured

by the 3G Tech platform.

Bion believes its meat products will meet consumer demands with respect to sustainability and safety (organic)

and provide the tenderness and taste American consumers have come to expect from premium conventional American beef.

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 low-cost

organic corn, and the resulting opportunity to produce organic beef, will dramatically differentiate us from potential competitors.

organic opportunity is dependent on successfully establishing Bion’s fertilizer products as acceptable for use in organic grain

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 corn-finished organic beef product is largely unavailable in the marketplace today due to the higher

costs of producing organic corn.

The exception is offerings that are very expensive from small ‘boutique’

beef producers.

Like all plants, corn requires nitrogen to grow.

Corn is especially sensitive to a late-season application of readily available nitrogen

the key to maximizing yields.

With non-organic field corn, this nitrogen is supplied by an application of a low-cost synthetic

fertilizer, such as urea or anhydrous ammonia.

However, the cost for suitable nitrogen fertilizer that can be applied late-season in organic

corn production is so high that the late-season application becomes uneconomical, resulting in substantially lower yields –

recognized phenomena known as the ‘yield gap’

in organic production.

The yield gap results in higher costs for organic corn

that, in turn, make it uneconomical to feed that corn to livestock.

As is the case for sustainable but not organic beef, 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 at this time, position to participate in JV’s

that will benefit from this opportunity starting next year.

The demonstrated willingness of consumers to purchase

sustainable products (along with numerous research and marketing studies confirming consumers are seeking, and are willing to pay a premium

for, sustainable products)---in combination with the threat to the livestock industry market (primarily beef and pork) posed by plant-based

alternatives (heightened by pandemic conditions)--- has succeeded in focusing the large scale livestock industry on how to meet the plant-based

market challenge by addressing the consumer sustainability issues.

The consumer demand for sustainability appears to be a real and lasting

trend, but consumers remain skeptical of generalized claims of ‘sustainability’.

To date, a large portion of the industry

responses have been at a superficial level or consist of ‘green washing’, a deceptive marketing practice where companies promote

non-substantive initiatives.

Real sustainability for the livestock industry will require implementation of advanced waste treatment technology

at or near the livestock production facilities (“Concentrated Animal Feeding Operations”

or “CAFOs”) –

most of the negative environmental impacts take place.

Technology Deployment:

Widespread deployment of waste treatment technology,

and the sustainability it enables, is largely dependent upon generating sufficient additional revenues to offset the capital and operating

costs associated with technology adoption.

Bion’s 3G Tech has been developed to create opportunities for such augmented revenue

streams, while providing third party verification of sustainability claims.

The 3G Tech platform has been designed to maximize the value

of co-products produced during the waste treatment/recovery processes, including pipeline-quality renewable natural gas (biogas) and commercial

fertilizer products approved for organic production.

All processes will be verifiable by third parties (including regulatory authorities

and certifying boards) to comply with environmental regulations and trading programs and meet the requirements for:

a) renewable energy

and carbon credits, b) organic certification of the fertilizer coproducts and c) USDA PVP certification of an ‘Environmentally Sustainable’

brand (see discussion below), and d) payment for verified ecosystem services.

The Company’s first patent on its 3G Tech was issued

In August 2020, the Company received a Notice of Allowance on its third patent which significantly expands the breadth and

depth of the Company’s 3G Tech coverage, and the Company has additional applications pending and/or planned (See “Patents”).

Bion’s business model and technology platform

can create the opportunity for JVs (in various contractual forms) between the Company and large livestock/food/fertilizer industry participants,

based upon the supplemental cash flow generated by implementation of our 3G Tech business model, which will support the costs of technology

implementation (including related debt).

We anticipate this will result in long term value for Bion.

In the context of such JVs, we believe

that the verifiable sustainable branding opportunities (conventional and organic) may expand to represent the single largest enhanced

revenue contributor provided by Bion to the JVs (and Bion licensees).

The Company believes that the largest portion of its business with

be conducted through such JVs, but a material portion may involve licensing and or other approaches.

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

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 Pennsylvania and other

states) 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 can then 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.

Competitive procurement

of verified credits is now supported by US EPA, the Chesapeake Bay Commission, national livestock interests, and other key stakeholders.

Legislation in Pennsylvania to establish the first such state competitive procurement program passed the Pennsylvania Senate by

a bi-partisan majority during March 2019.

However, the Covid-19 pandemic and related financial/budgetary crises have subsequently

slowed progress for this and other policy initiatives and, as a result, it is not currently possible to project the timeline for

this and other similar initiatives (see discussion below).

The livestock 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 - policies are already changing.

Bion’s 3G technology

was developed for implementation on large scale livestock production facilities, where scale drives lower treatment costs and efficient

production of co-products.

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 source

from which most of the industry’s environmental impacts are initiated.

Bion intends to assist the forward-looking segment

of the livestock industry in actually bringing animal protein production in line with Twenty-first Century consumer demands for

sustainability.

The Problem/Opportunity

(according to the USDA’s

2017 agricultural census) there are over 9M dairy cows, 90M beef cattle, 60M swine and more than 2 billion poultry which provides

an indication of both the scope of the problem addressed by Bion’s technology, as well as the size of the opportunity.

Environmental

impacts from livestock production include surface and groundwater pollution, greenhouse gas emissions and other air pollution,

excess water use and pathogens related to foodborne illnesses and antibiotic resistance.

The greatest impacts come from the manure

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 –

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, is supported by US EPA, the Chesapeake Bay Commission, national livestock

interests, and other key stakeholders.

Legislation in PA to establish the first such state competitive procurement program passed the

Pennsylvania Senate by a bi-partisan majority during March 2019.

However, the Covid-19 pandemic and related financial/budgetary crises

have slowed progress for this and other policy initiatives and, as a result, it is not currently possible to project the timeline for

completion (or meaningful progress) of this and other similar initiatives (see discussion below).

The livestock industry and its markets are already

with a commercial-ready technology and business model, Bion believes it has a ‘first-mover advantage’

that will seek to exploit the opportunities that will arise from the industry’s inevitable transformation.

Bion anticipates moving

forward with the development process of its initial commercial installations utilizing its 3G Tech, during the current 2022 fiscal year.

We believe that Bion’s 3G Tech platform and business model can provide a pathway to true economic and environmental sustainability

with ‘win-win’

benefits for at least a premium sector of the livestock industry, the environment, and the consumer, an opportunity

which the Company intends to pursue.

The Livestock Problem

The livestock industry is under tremendous pressure

from regulatory agencies, a wide range of advocacy groups, institutional investors and the industry’s own consumers all of whom

a pushing the industry to adopt sustainable practices.

Environmental cleanup is inevitable and has already begun - and policies have already

begun to change.

Bion’s 3G Tech was developed for implementation on large scale livestock production facilities, where scale can

drive both lower treatment costs and efficient co-products production, while producing dramatic environmental improvements.

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 livestock production—the primary source of the industry’s environmental

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, verifiable and believable sustainability.

(according to the USDA’s 2017 agricultural

census) there are over 9M dairy cows, 90M beef cattle, 60M swine and more than 2 billion poultry which provides an indication of both

the scope of the problem, as well as the size of the opportunity that can be addressed by Bion’s technology.

Environmental impacts

from livestock production include surface- and groundwater pollution, greenhouse gas emissions, ammonia, 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.

The greatest impacts come from the manure waste.

of total annual U.S.

livestock manure waste vary widely, but start around a billion tons, between 100 and 130 times greater than human

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.

More than half of U.S.

production is fertilized in this manner.

Runoff from livestock waste has been identified as one of the largest sources of excess

nutrients in most major watersheds.

Excess nutrients fuel algae blooms nationwide that are increasingly toxic;

dead zones in the

Great Lakes, Chesapeake Bay, and Gulf of Mexico;

and nitrate-contaminated drinking water in a growing number of states including

Pennsylvania, California, Wisconsin, Washington and other states.

Large portions of U.S.

feed crop production (and most organic crop

production) is fertilized, in part, in this manner.

Under current manure management practices, 80% or more of total nitrogen is lost from

manure during storage, transportation, and after soil application.

Runoff from livestock waste has been identified as one of the largest

sources of excess nutrients in most major watersheds.

Excess nutrients fuel algae blooms nationwide that are increasingly toxic and fuel

dead zones in the Great Lakes, Chesapeake Bay, and Gulf of Mexico.

Nitrate-contaminated drinking water is a problem in a growing number

of states including Pennsylvania, California, Wisconsin, Washington and others.

US EPA considers excess nutrients “one of America’s

2 unchanged sentences

and increasing rainstorm intensity resulting from climate change.

More than half of the nitrogen nutrient impacts

from livestock come from ammonia emissions from the waste.

Nitrogen in the form of ammonia is extremely volatile, reactive and

When airborne ammonia/ nitrogen eventually settles back to the ground through atmospheric deposition - it ‘rains’

Most of this nitrogen enters surface and groundwater.

In the context of groundwater aquifers, it can contaminate drinking

water sources.

It is now well-established that most of the voluntary conservation practices (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 previously was believed to be the case.

This is especially the case with regard to addressing

mobile ammonia emissions because such BMPs are primarily focused on surface water runoff, directly from farm fields in current

production, versus the re-deposition that takes place everywhere.

Further, groundwater (vs surface water) transports

this volatile nitrogen downstream, creating an additional problem, since most of the current conservation practices relied on to

reduce agricultural runoff to our lakes and estuaries are bypassed by this subsurface flow.

Nitrate-contaminated groundwater is

of growing concern in agricultural regions nationwide.

Pennsylvania, Wisconsin, California and Washington, (and other states) all

now have regions where groundwater nitrate levels exceed EPA standards for safe drinking water.

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’

Nutrients from livestock waste runoff fuel

downstream toxic algae blooms and dead zones in the Chesapeake Bay,Gulf of Mexico, Florida Bay, and many other estuaries, as well

as the Great Lakes,.

Excess nutrient runoff also impacts local- and fresh-water resources, producing algae blooms in lakes and

rivers and contaminating underground aquifers that supply drinking water.

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’

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

decade, 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.

US 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.

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 we rely 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.

High phosphorus concentrations in soils fertilized

with raw manure are another growing problem.

The ratio of nitrogen to phosphorus in livestock waste is fixed, and because manure application

rates are calculated based on nitrogen requirements, often phosphorus is over-applied as an unintended consequence.

Phosphorus accumulation

in agricultural soils reduces its productivity, increases the risk of phosphorus runoff, and represents a waste of a finite resource.

Decoupling the nitrogen from the phosphorus would allow them to be precision-applied, independently of each other, when and where needed.

The impacts of livestock production on public health

and the environment are coming under increasing scrutiny from environmental groups and health organizations, regulatory agencies

and the environment are coming under increasing scrutiny from environmental groups and health organizations, regulatory agencies and the

courts, the media, consumers and activist institutional investors.

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 campaign discussed above.

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.

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.

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.

Bion's 3G Tech prevents the uncontrolled release

to the environment of most of the nutrients from the CAFO waste stream, while recovering a substantial portion of those nutrients

for value-added commercial utilization.

Our technology platform largely eliminates ammonia emissions, other substantial greenhouse

gas emissions, odors and other harmful air pollutants.

Additionally, the platform destroys virtually all pathogens in the waste

stream that have been linked to foodborne illnesses and growing antibiotic resistance.

Similar to point-source treatment, such

as provided by an industrial or municipal wastewater treatment plants, the performance of Bion’s technology platform can

be precisely monitored, measured and quantified (in contrast to the modeled, in-exact - and so far, disappointing - results from

Third-party data from our facilities can provide the basis for verified environmental credits, and related revenues, as

well as sustainable branding claims.

Bion’s proven second generation technology

(“2G Tech”) platform (now discontinued as our 3G Tech nears commercial implementation) was developed to provide comprehensive

onsite livestock waste treatment for wet (beef/dairy/swine) waste streams and has been proven at commercial scale at Kreider

Dairy Farm (“Kreider 1”) in Pennsylvania (“PA”).

In 2012, the Pennsylvania Department of Environmental

Protection (“PADEP”) issued the Kreider 1 system a full water quality management permit and verified the nitrogen and

phosphorus reductions achieved by our 2G Tech.

These ‘verified nutrient credits’

were qualified to be used as qualified

offsets to PA’s federally-mandated Chesapeake Bay nutrient reduction requirements.

In 2014 the 2G Tech was reviewed and qualified

for federal loan guarantees under USDA’s Technical Assessment program.

The Company anticipates that our 3G Tech will be similarly

qualified and will produce results that exceed the results provided by our 2G Tech.

Bion is working with several stakeholders, including national representatives

of the livestock industry, and members of the PA Legislature, and various other stakeholders, to establish a competitive bidding

program in PA and other states that will, if implemented allow the Commonwealth of Pennsylvania to purchase low-cost nutrient reduction

credits from private-sector providers such as Bion.

Bion believes that many states, which face similar livestock waste-related

nutrient pollution issues, will adopt a similar strategy in the future.

When competitively-bid markets for nutrient reductions

become fully-established, Bion anticipates a robust opportunity to use its 3G Tech-based platforms to retrofit both existing CAFOs

and equip new large-scale livestock facilities (“Projects”) to generate revenue from sales of verified nutrient reduction

Once Bion has been successful in certifying its fertilizer co-products for organic use (with resulting higher-value markets),

we believe that revenue from organic co-products alone, together with renewable energy credit revenues and the potential value

of environmental sustainable branding, will combine to create numerous profitable economically and environmentally sustainable

opportunities for our Projects and related JVs, even without the nutrient credits upon which Bion’s 2G Tech business model

Policy Change is Coming

The current clean water strategy being

utilized in the U.S.

is clearly failing, because it doesn’t adequately address waste from agriculture.

About half of U.S.

crops are now fertilized with raw, untreated manure.

However, approximately 75 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 and.

livestock waste is one of the largest contributors to nutrient problems in our watersheds, livestock waste treatment can be the

source of the low-cost solution for such problems –

if the waste is treated at (or close to) the source of production.

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 developing sources of new

revenues which will enable the livestock industry to offset the implementation costs for the cleanup.

Despite trends toward concentration over

the last several decades, the U.S.

animal-protein industry remains (in key parts) a fragmented, low-margin commodity business.

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.

export market represents a significant part of the U.S.

livestock production industry.

An abrupt increase 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 approximately $110 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 verified air and water quality solutions compared to current strategy.

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.

NOTE, HOWEVER, THAT THE CURRENT COVID-19

PANDEMIC AND RESULTANT ECONOMIC CRISES AND BUDGETARY CONSTRAINTS APPEAR TO HAVE DELAYED POLICY INITIATIVES RELATED TO THESE MATTERS

AT BOTH THE STATE AND FEDERAL LEVELS.

AS A RESULT, IT IS NOT CURRENTLY POSSIBLE TO REASONABLY PROJECT A TIMETABLE FOR ADOPTION

OF THE POLICY CHANGES DISCUSSED HEREIN.

A bipartisan 2013 Pennsylvania legislative study projected

that creating a competitive bidding program to procure nitrogen reductions to meet federal Chesapeake Bay mandates, regardless

of source , could reduce the state’s tax- and ratepayer-funded compliance costs by up to 80 percent (approximately

$1.5B annually).

The legislative study was updated in 2018 to reflect new policies.

The updated report projects savings of up to

As discussed in the original study, much of the savings were due to low-cost high-impact manure control projects (Bion’s

technology figured prominently in the report).

Senate Bill 575, which is supported by legislative leadership, national livestock

interests and other key stakeholders (and is consistent with US EPA policies), will establish a competitive procurement program

that will unlock some of these opportunities in PA.

In June 2019, the Pennsylvania Senate voted 33 to 17 in favor of Senate Bill

The bill is now pending in the House.

Bion was optimistic that the bill would be adopted by the House and signed by the Governor

in the current session as the bill was scheduled to be taken up in the House during March 2020 but one effect of the Covid-19 pandemic

crisis has been that PA funding for new initiatives is largely ‘on hold’

at the present time.

In a 2017 Letter of Expectation to

PA’s Department of Environmental Protection, US EPA demonstrated its support of a procurement strategy to engage the private

sector - as long as the Credits are verified.

It is noteworthy that US EPA and national livestock industry representatives agree

on this strategy.

Such a procurement strategy is also consistent with USDA and EPA support of ‘Private Partnerships’

and OMB’s guidance that supports acquiring verified results vs.

financing projects with uncertain outcomes and taxpayer risks.

We believe that strategies being developed in Pennsylvania and the Chesapeake Bay are likely to serve as a model for the 40 other

states now seeking solutions to similar water quality problems.

Today, most states face a similar issue---unfunded federal clean

water mandates.

Pennsylvania’s proposed competitive bidding program provides an opportunity to significantly reduce the cost

to PA (and a model for other states to utilize in the future) in meeting such mandates.

The result has been a significant and alarming loss of market

share to plant-based protein and other alternative products.

Bion’s 3G Tech platform was designed to resolve these environmental

issues and bring the industry in line with twenty-first century consumer expectations.

Technology and Technology Platform

We have invested years of work and substantial

capital on the development of our technology and technology platform since 1989.

Bion’s patented second generation

technology (“2G Tech”) was proven at commercial scale and it was reviewed and qualified for federal loan guarantees

Bion has invested years of work and substantial capital

on the development of our technology and technology platform since 1989.

The predecessor to Bion’s 3G Tech platform, our patented

second-generation technology (“2G Tech”), was proven at commercial scale and was reviewed and qualified for federal loan guarantees

under USDA’s Technical Assessment program.

Bion’s 2G Tech Kreider dairy project (“Kreider 1”

or “KF1”)

received the first verified /measurable nutrient reduction credits from a non-point source livestock facility in the U.S.

nutrient reductions were verified by the Pennsylvania Department of Environmental Protection (“DEP”) during 2012.

key attribute of Bion’s 2G Tech (now supplanted by our 3G Tech) was that nutrient and other pollution reductions could be

measured, providing a level of verification on par with a municipal wastewater treatment plant -- which created the opportunity

for their nutrient reductions to be used as “qualified offsets”

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.

A key attribute of Bion’s 2G Tech (now supplanted

by our 3G Tech) was that nutrient and other pollution reductions could be measured, providing a level of verification on par with a

municipal wastewater treatment plant, which created the opportunity for the nutrient reductions to be used as “qualified offsets”

to EPA-mandated requirements.

While it was an engineering

success, Kreider 1 has failed financially to date because the 2G Tech platform was almost wholly dependent for revenue from anticipated

demand for Credits based on nitrogen reductions in Pennsylvania’s trading program that failed to materialize.

is no longer implementing Projects based on its 2G Tech and the Kreider 1 project has been shut down.

Our 3G Tech was developed by Bion to avoid

the dependence of our 2G Tech systems on the sale of Credits.

The 3G Tech platform has been designed to capture revenues from environmental

reductions, co-products and premium pricing from USDA ‘environmentally sustainable’

retail branding.

The first patent

on the 3G Tech was filed in 2015 for an ammonia recovery process that produces ammonium bicarbonate (a commercial fertilizer) without

external chemical additives, thereby providing the basis for organic certification.

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

Since July 2017 Bion has filed for extensions of this patent application 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’

our third patent related to our 3G Tech.

(See “Patents”

below.) The 3G Tech platform incorporates Bion’s patented

and proprietary technology while utilizing existing commercial evaporation and distillation process equipment (with decades of

reliability and service history) that is customized for Bion’s specific applications.

The 3G Tech platform is the basis for a

JV business model with four distinct revenue streams :

1) pipeline quality renewable natural gas and related carbon credits,

2) premium organic fertilizer products, 3) nutrient credits, and 4) premium pricing from USDA-certified ‘Environmentally

Sustainable’

While it was an engineering success, Kreider 1 has failed financially because the 2G Tech platform was almost

wholly dependent for revenue from anticipated demand for nutrient credits, based on PA’s mandated nitrogen reductions under the

Chesapeake Bay Strategy and their proposed nutrient trading program that failed to materialize.

Bion began development of its 3G Tech

platform when it became apparent there was significant opposition to the trading program (and private sector participation in clean water

activities, generally) from entrenched clean water interests.

The Company is no longer implementing Projects based on its 2G Tech and

the Kreider 1 project has been shut down.

Bion’s 3G Tech was developed to avoid the dependence

of our 2G Tech systems on the sale of water quality trading credits in order to develop profitable projects.

The 3G Tech platform has

been designed to maximize revenues from co-products, including biogas and fertilizer products, achieve premium pricing from USDA PVP-certified

‘environmentally sustainable’

retail branding of the animal protein products it supports, as well as generate verified credits

for still-developing water quality trading programs.

The first patent on the 3G Tech was filed in 2015 for an ammonia recovery process

that produces ammonium bicarbonate (a commercial fertilizer) without external chemical additives, thereby providing the basis for organic

certification.

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 extensions of this patent application

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 3G Tech and additional related applications are pending and/or planned

(See “Patents”.) The 3G Tech platform incorporates Bion’s patented and proprietary technology while utilizing existing

commercial evaporation and distillation process equipment (with decades of reliability and service history) that is customized for Bion’s

specific applications.

The 3G Tech platform is the basis for a JV business

model with four distinct revenue streams :

1) pipeline quality renewable natural gas and related carbon and other environmental credits,

2) premium organic fertilizer products, 3) nutrient credits, and 4) premium pricing from USDA PVP-certified ‘Environmentally Sustainable’

branding at the retail level.

Carbon and nutrient credit revenues will be generated by third-party verification

of the waste treatment processes that produce renewable energy and fertilizer products - with relatively limited incremental cost

The same verified data will provide the backbone for the USDA-certified sustainable brand, again with limited incremental

1) Renewable energy and related carbon credits:

Bion’s 3G Tech platform

utilizes customized anaerobic digestion (“AD”) to recover methane from the waste stream.

At sufficient scale, methane

produced from AD can be cost-effectively conditioned, compressed and injected into a pipeline.

Carbon and nutrient credit revenues will be supported by third-party verification of the waste treatment

processes that simultaneously capture methane and nutrients, while producing renewable energy and fertilizer products from them with relatively

limited incremental cost to Bion.

The same verified data will also provide the backbone for the USDA PVP-certified sustainable brand,

again with limited incremental cost.

1) Renewable energy- and carbon-related credits:

Bion’s 3G Tech platform utilizes

customized anaerobic digestion (“AD”) to recover biogas (methane) from the waste stream.

At sufficient scale, methane produced

from AD can be cost-effectively conditioned, compressed and injected into a pipeline.

The US Renewable Fuel Standard (“RFS”)

program and state programs in California and elsewhere provide ongoing renewable energy credits for the production and use of renewable

transportation fuels.

program and state programs in California and elsewhere provide ongoing renewable energy credits for the production of biogas and its subsequent

use as a renewable transportation fuel.

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) Organic Fertilizer products:

The 3G Tech platform has been designed

to produce multiple fertilizer products including:

i) ammonia bicarbonate liquid, ii) ammonium bicarbonate in solid crystal form

and iii) a soil amendment products that will contain the remaining nitrogen, phosphorus and other micronutrients captured from

the livestock waste stream.

Bion believes each product will qualify for organic certification and intends to file multiple applications

for varying concentrations of crystal product going forward.

Ammonium bicarbonate manufactured

using chemical processes has a long history of use as a fertilizer.

Bion’s intends to develop ammonium bicarbonate crystal

products which will contain 14-16 percent nitrogen in a crystalline form that will be easily transported, water soluble and provide

readily-available nitrogen.

The products 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 that can be precision-applied to crops using existing equipment.

Bion believes that this product will potentially have

broad applications in the production of organic grains for livestock feed, row crops, horticulture, greenhouse and hydroponic production,

and potentially retail lawn and garden products.

The 3G Tech platform has been designed to

produce multiple fertilizer products, including:

i) ammonium bicarbonate liquid, ii) ammonium bicarbonate in solid crystal form –

AD Nitrogen –

and iii) soil amendment products that will contain the remaining nitrogen, phosphorus and other micronutrients captured

from the livestock waste stream.

Bion believes each product will qualify for organic certification.

The Company has filed an application

the initial version of its crystal product which is in the review process.

Additional applications may be filed in subsequent periods.

Ammonium bicarbonate, manufactured using

chemical processes, has a long history of use as a fertilizer.

Bion’s has developed solid ammonium bicarbonate products containing

18-22 percent nitrogen in a crystalline form that is easily transported, is water soluble and provides a readily available nitrogen source

The products 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 that can be precision-applied

to crops using existing equipment.

Bion believes that this product will potentially have broad applications in the production of organic

grains for livestock feed, row crops, horticulture, greenhouse and hydroponic production, and potentially retail lawn and garden products.

The AD Nitrogen and other ammonium bicarbonate

products produced by Bion’s 3G Tech platform will enjoy a dramatically lower carbon footprint than synthetic fertilizers.

nitrogen captured and upcycled into AD Nitrogen was going to be lost through volatilization and runoff, and that loss would generally

need to be offset with a synthetic nitrogen, 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, with methane as the energy

It is an extremely energy-intensive process with a carbon footprint that , while not yet fully understood, is widely accepted

to by very large.

While a complete Life Cycle Analysis (LCA) of carbon impacts from synthetic fertilizer production is not available,

according to the Institute for Industrial Productivity, its production alone is responsible for approximately 1 percent of total global

CO2 emissions.

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

The Company’s initial low concentration

ammonium bicarbonate liquid product completed its OMRI application and review process with approval during May 2020.

To provide a first level degree of clarity regarding

organic approvals and the processes/procedures involved, Bion believes that this initial approval is of importance because subsequent

organic products that are produced by using the very same technology platform (our 3G Tech) can now piggyback on the initial approval

to a significant degree.

Bion’s second

application to OMRI, for its initial solid AD Nitrogen product, was filed during May 2021and is currently being reviewed.

To provide a first level degree of clarity

regarding organic approvals and the processes/procedures involved, Bion believes that the initial OMRI approval is of importance, because

subsequent organic products that are produced by using the very same technology platform (our 3G Tech) can now piggyback on the initial

approval to a significant degree.

Note that there are different layers to the U.S.

4 unchanged sentences

was established by Congress in 2001 under the USDA’s Agricultural Marketing Service.

The NOP develops and enforces uniform

national standards for organically- produced agricultural end products –

The NOP develops and enforces uniform national

standards for organically- produced agricultural end products –

meat/dairy/milk, fruits, vegetables –

sold in the United States.

Operating as a public-private partnership, NOP accredits private companies and helps train their inspectors

(USDA-accredited Certifiers) to certify that farms and businesses meet the national organic standards.

For example, in a potential

Midwest organic beef project (discussed below), each element in the supply chain must provide their certifying agent’s certification

that the specific product, such as organic corn, has been produced in accordance with their organic plan.

The end product - the

beef - would be USDA-certified as organic by an accredited Certifier after a review of ALL the farming practices and inputs (which

would include Bion’s ammonium bicarbonate fertilizer).

OMRI is a nonprofit organization that provides

an independent review of products, such as fertilizers, pest controls, livestock health care products, and numerous other inputs

sold in the United

Operating as a public-private partnership, NOP accredits private companies and helps train their inspectors (USDA-accredited Certifiers)

to certify that farms and businesses meet the national organic standards.

For example, in a potential Midwest organic beef project (discussed

below), each element in the supply chain must provide their certifying agent’s certification that the specific product, such as

organic corn, has been produced in accordance with their organic plan.

The end product - the beef - would be USDA-certified as organic

by an accredited Certifier after a review of ALL the farming practices and inputs (which would include Bion’s ammonium bicarbonate

OMRI is a nonprofit organization that

provides an independent review of products, such as fertilizers, pest controls, livestock health care products, and numerous other inputs

that are intended for use in certified organic production and processing.

OMRI reviews these products against the organic standards

established by the NOP to determine if they are suitable for use in organic production.

OMRI reviews these products against the organic standards established

by the NOP to determine if they are suitable for use in organic production.

Acceptable products are then OMRI Listed®.

OMRI enables a national listing thru one application

versus the alternative of using certifiers to secure listings in individual states.

To those who wish to sell organic fertilizers

into national distribution channels, an OMRI listing provides nearly uniform acceptance in the U.S.

The OMRI listing Bion received

in May was for our initial commercial product, a low-concentration liquid ammonia.

OMRI enables a national listing thru

one application versus the alternative of using certifiers to secure listings in individual states.

To those who wish to sell organic

fertilizers into national distribution channels, an OMRI listing provides nearly uniform acceptance in the U.S.

The OMRI listing Bion

received in May was for our initial commercial product, a low-concentration liquid ammonia.

It is valid ONLY for that particular product.

For future Bion product offerings using the same technology platform, Bion will either need to file for specific state approval,

or file with OMRI for a national listing, or a combination of the two.

Bion may elect to use an individual state listing initially

to be followed by an OMRI application if and when the need for a regional or national listing arises.

The overarching standard of organic production,

per NOP guidelines, is that a “product shall have been produced and handled without the use of synthetic chemicals…”

For future Bion product offerings using the same technology platform, Bion will either need to file for specific state approval, or file

with OMRI for a national listing, or a combination of the two.

Bion may elect to use an individual state listing initially to be followed

by an OMRI application if and when the need for a regional or national listing arises.

The overarching standard of organic

production, per NOP guidelines, is that a “product shall have been produced and handled without the use of synthetic chemicals…”

That is rule Number One.

At NOP, the term "synthetic"

means “a substance that is formulated or manufactured by

a chemical process or by a process that chemically changes a substance extracted from naturally occurring plant, animal, or mineral

sources, except that such term shall not apply to substances created by naturally occurring biological processes.”

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.

The Company believes that

organic approvals for its products:

a) will provide access to substantially higher value markets compared to synthetic nitrogen

products, and/or b) allow its products to be utilized in growing of organic feed grains to be consumed by livestock raised in

JVs which will thereafter receive organic approvals.

Based on preliminary market surveys to date:

a) we believe that existing

competing organic fertilizer products in both liquid and granular form are being sold presently at price points significantly

greater than Bion’s projected cost and projected pricing, and b) that livestock products (beef and pork) raised with feed

grains grown using Bion organic ammonium carbonate fertilizer products (during the ‘finishing’

stage) will qualify

for organic approvals.

It is anticipated that the Company will seek approvals for such products during the balance of the current

fiscal year and will commence JVs that undertake initial production and marketing of such products during the 2021 calendar year.

means “a substance that is formulated or manufactured by a chemical

process or by a process that chemically changes a substance extracted from naturally occurring plant, animal, or mineral sources, except

that such term shall not apply to substances created by naturally occurring biological processes.”

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.

The Company believes that organic approvals

for its products will:

a) provide access to substantially higher value markets compared to synthetic nitrogen products, and/or b) allow

its products to be utilized in growing of organic feed grains to be consumed by livestock raised in JVs which will be sold as organic.

Based on preliminary market surveys to date, we believe that existing competing organic fertilizer products in both liquid and granular

form are being sold presently at price points significantly greater than Bion’s projected cost and projected pricing.

We also believe

that livestock products from animals raised with feed grains grown using Bion organic ammonium bicarbonate fertilizer products (and that

otherwise qualify) will receive organic approvals.

It is anticipated that the Company will continue to seek approvals for such products

during the balance of the current fiscal year and will commence JVs that undertake initial production and marketing of such products during

the 2022 calendar year.

3) Nutrient credits:

Bion believed that passage in Pennsylvania

of legislation earlier this year that would establish a competitively-bid market for nutrient reduction Credits in Pennsylvania.

The bill will most likely need to be re-introduced in the Senate 2021—2022 session commencing in January 2021.

Bion anticipates

that passage of SB575 (or re-introduced bill) in Pennsylvania will establish a competitively-bid market for nutrient reduction

Credits in Pennsylvania within twelve months after passage and being signed into law by the Governor.

Note, however, that the current

Covid-19 pandemic and resultant economic crises and budgetary constraints have delayed policy initiatives related to these matters

at both the state and federal levels.

As a result, it is not currently possible to reasonably project a timetable for adoption

of the policy changes discussed herein.

Bion’s Kreider Farms poultry

project (“Kreider 2”) is projected to generate between 1.5-3M lbs of Chesapeake Bay (“CB”

or “Bay”)

verified nitrogen reduction Credits (the range depends on the specific calculation methodology agreed to between the EPA and the

Pennsylvania DEP).

Bion anticipates the market value for these verified credits will be in the range of $8 to $12 per pound annually.

The focus of the latest PA regulatory watershed improvement plan (“WIP”) has shifted the reduction mandates to individual

Lancaster County, PA is being asked to reduce 21% of the mandate (approximately 11M lbs of nitrogen) to the Bay.

result, the Kreider 2 project in Lancaster County may expand to include a regional processing opportunity in addition to the Kreider

2 base project.

Bion believes that initial funding of such competitive bidding program will allow Bion and others to demonstrate

the technological effectiveness and cost savings of manure control technologies, which should result in the re-allocation of a

portion of the existing approximately $110B in taxpayer clean water funding to be re-directed to nutrient procurement programs

Bion believes that nutrient reduction (and

other similar) credits and/or other methods of monetizing environmental benefits from the capture and re-purposing of the nutrients (largely

nitrogen and phosphorus) from the livestock waste stream, will become available in multiple states over the next several years.

in the Pennsylvania (“PA”) Senate of key legislation –

SB 575 –

in June 2019 that would have established a competitively-bid

market for nutrient credits in PA, is indicative of the trends.

Despite the fact that the bill was not considered in the House, due to

the Covid-19 pandemic (a re-introduced bill will have to be considered again in the current and/or future sessions (currently SB 475 and

SB 832 have been introduced and are pending), Bion anticipates that after passage of a similar bill in the future, PA will establish a

competitively-bid market for nutrient credits within twelve months after legislative passage and being signed into law by the Governor.

See “Policy Change is Coming”

and “Kreider Poultry Joint Venture and Pennsylvania and Chesapeake Bay Initiatives”

below for discussion of the history and status of matters in PA.

Note, however, that the current Covid-19

pandemic and resultant social and economic crises and budgetary constraints have delayed policy initiatives related to these matters at

both the state and federal levels.

As a result, it is not currently possible to reasonably project a timetable for adoption of the policy

changes discussed herein.

4) Sustainable Branding:

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to pay a premium for their safe and sustainable food choices.

in 2015, Bion has worked with the USDA’s Process Verified Program (“PVP”) –

the gold standard in food verification

and branding –

to establish a USDA-certified sustainable brand.

Bion received conditional approval from the PVP”)

related to its Kreider 1 project (utilizing 2G Tech).

It is our intention to amend and resubmit its application for the 3G Tech

platform when the initial 3G Tech Project is operational and seek an approval for certification based on third-party-verified reductions

in nutrient impacts, greenhouse gases and pathogens in the waste stream based on our 3G Tech.

PVP certification incorporated as

part of a recognizable brand will provide consumers with products and brands that can be trusted.

Bion projects that such a brand

and livestock product line will command a pricing premium for Bion livestock JVs and their customers.

Food safety and sustainability

are issues of growing importance in the U.S.

Based on Bion’s recognition of the potential opportunities created

by such willingness, beginning in 2015, Bion has 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).

our intention to submit an application for the 3G Tech platform when the initial 3G Tech Project is operational later this fiscal year

and seek an approval for certification based on third-party-verified reductions in nutrient impacts, greenhouse gases and pathogens in

the waste stream (and other attributes), based on our 3G Tech.

PVP certification incorporated as part of a recognizable brand 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 Bion’s livestock JVs and their customers.

Food safety and sustainability are issues

of growing importance in the U.S.

and worldwide.

Bion’s branding initiative reflects trends already underway in

the livestock industry.

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.

More recently, 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.

Over the last few years, most

large meat and dairy product retailers have announced ‘sustainability’

initiatives, although the definition of sustainability

Bion believes that as these initiatives move forward, true sustainability on the production side will look a lot

like what Bion can provide today with its 3G Tech.

We believe our 3G Tech platform can deliver verifiable metrics that demonstrate

meaningful improvements in sustainability for livestock production including:

a) reduced carbon and nutrient footprint;

Bion’s branding initiative reflects trends already underway in the livestock industry.

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.

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 3G Tech

platform can provide today.

The 3G Tech platform can deliver verifiable metrics that demonstrate meaningful improvements in sustainability

for livestock production that are unmatched in the industry today, including a dramatically reduced carbon and nutrient footprint;

negative impacts to water, soil and air;

c) increased pathogen destruction and other environmental and public health impacts that

are unmatched in the industry today.

The Covid-19 pandemic has further heightened consumer awareness

and concerns related to:

a) environmental sustainability, b) food safety, c) sourcing and traceability and d) humane treatment

of both animals and workers.

The more the livestock industry’s supply chain practices are transparent and known by consumers,

the more consumers are seeking alternatives.

Bion’s ‘Environmental/Sustainable’

program is designed to address a wide array of consumer concerns ranging from:

increased pathogen destruction;

and other environmental and public health impacts.

pandemic has further heightened consumer awareness and concerns related to a) environmental sustainability, b) food safety, c) sourcing

and traceability and d) humane treatment of both animals and workers.

The more the livestock industry’s

supply chain practices become transparent and known by consumers, the more consumers are seeking alternatives.

Bion’s ‘Sustainable’

branding program is designed to address a wide array of consumer concerns ranging from:

a) ‘where does your food come from?’

b) animal heritage information;

c) anti-biotic use standards;

d) humane animal treatment;

d) its labor/human conditions (including

hours, wages and working condition standards).

It will include block chain traceability thereby enabling any quality issues to

be quickly identified by lot and location thereby minimizing risk to its consumers.

In essence, Bion’s comprehensive technology platform

will enable its livestock producer adopters to not only be the provider of the ‘product the consumer wants’

the company that ‘shares the consumer’s values’.

For the past decade, Bion has been directed

toward creating applications of our patented and proprietary waste management technologies and technology platform to pursue JVs

in three main business opportunities:

1) Installation of Bion systems to retrofit and environmentally remediate existing large CAFOs (“Retrofits”

and “Retrofit Projects”) in selected markets where:

a) government policy supports such

efforts (such as the Chesapeake Bay watershed, Great Lakes Basin states, and/or other states and watersheds facing EPA ‘total

maximum daily load’

(animal heritage information);

b) environmental impacts;

c) antibiotic use/ standards;

d) animal welfare/ humane treatment;

welfare/ working conditions.

These issues can be addressed with the consumer through general advertising and/or at the point of sale with

a QR code on the packaging that links back to product-specific data.

The verification processes that will be employed by Bion’s

3G Tech 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.

In essence, Bion’s

comprehensive technology platform will enable its livestock JVs and other adopters to be not only the provider of the product the consumer

wants, but also the businesses that shares their consumers’

Technology Applications/Business Opportunities

For the past decade, Bion has been focused on developing

its 3G Tech platform and creating applications for its patented and proprietary waste management technology platform to pursue JVs and

other business opportunities in three broad categories:

Development of new state-of-the-art large scale waste treatment facilities (now utilizing our 3G Tech) as JVs, which may be developed

in conjunction with new CAFOs in strategic locations (some of which were previously impracticable due to environmental impacts) and/or

to treat the waste streams from one or more existing large livestock facilities (“Projects”).

Some of these Projects may be

either a) Integrated Projects as described below, b) ‘central processing facilities’

which receive the waste from multiple

livestock facilities, c) Retrofit Projects or d) hybrids with elements of each of these types.

Each version will be able to realize revenue

from multiple revenue streams potentially generated by our 3G Tech.

The “Sustainable Beef”

“Sustainable Organic Beef”

opportunities (discussed both above and below) would be examples of this category.

b) Installation

of Bion systems to retrofit and environmentally remediate existing large CAFOs (“Retrofits”

and “Retrofit Projects”)

in selected markets where:

a) government policy supports such efforts

(such as the Chesapeake Bay watershed, Great Lakes Basin states, and/or other states and watersheds facing EPA ‘total maximum daily

(“TMDL”) issues), and/or

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to obtain permits to expand or develop without negative environmental consequences.

2) Development of new state-of-the-art

large scale waste treatment facilities (now utilizing our 3G Tech) as JVs which may be developed in conjunction with new CAFOs

in strategic locations that were previously impracticable due to environmental impacts and/or to treat the waste streams from one

or more existing large livestock facilities (“Projects”).

Some of these Projects may be either a) Integrated Projects

as described below, b) ‘central processing facilities’

which receive the waste from multiple livestock facilities,

c) Retrofit Projects or d) hybrids with elements of each of these types.

Each version will be able to realize revenue from multiple

revenue streams potentially generated by our 3G Tech.

3) Licensing and/or joint venturing

of Bion’s technology and applications (primarily) outside North America.

In both categories 1) and 2) above, the

Company intends to directly participate (whether by joint venture agreement or other contractual arrangements) in the revenues

of the Retrofits and Projects.

The opportunities described at categories

1) and 2) above each require substantial political and regulatory (federal, state and local) efforts on the part of the Company

and a substantial part of Bion’s efforts are focused on such political and regulatory matters.

Bion is currently intends

to pursue the international opportunities primarily through the use of consultants with existing relationships in target countries.

At this time, our primary focus is on categories

1) and 2) above using our 3G Tech to develop new (or expanded) large-scale Projects with strategic partners (including the Kreider

2 Project) on a joint venture (or other participating contractual form) basis.

Bion’s business model opens up the opportunity

for JV’s in various forms based upon the revenue generated by our 3G Tech platform from nutrient reductions, fertilizer co-products

and renewable natural gas (which revenue streams will be secured through long term take-off agreements for each of these co-products)

providing initial support for financing of required capital expenditures (whether equity or debt).

We anticipate that these revenue

streams will be supplemented by revenue realized from long-term premium pricing resulting from the sustainable branding opportunity.

We believe that the branding opportunity may provide the single largest contribution to the economic opportunity over time.

Kreider Poultry Farms –

3G Tech Project

Bion is completing an envelope of policy change

and technology pilots that will allow it to move forward with a commercial scale 3G Tech project at Kreider Farms.

Having recently

received a Notice of Allowance of its third 3G Tech patent, Bion is focused on multiple key tasks (including the following items)

that will allow Bion to finance and develop the Kreider 2 poultry project:

Support for adoption of PA SB 575 (or successor bill):

This will create a competitively-bid market

for nutrient reductions/Credits that we believe will provide support for project financing for Kreider 2 prior to development of

markets for the coproducts from Kreider 2 are established.

Installation of a commercial-scale 3G Tech ammonia recovery system to produce ammonium bicarbonate

products to be used for grower trials.

Completion of organic filings for all of Bion’s fertilizer products.

The 3G Tech Kreider 2 project is

planned for two (or more) locations.

It is intended to treat the waste from Kreider Farms’

1,600 dairy cows and approximately

six million egg layer chickens (with capacity for an additional three million layers).

The Project will be designed for an initial

capacity of 450 tons per day of waste and will remove nitrogen and phosphorus from the waste stream that will be converted into

high-value coproducts instead of polluting local and downstream waters.

The Project is planned to be built in three phases and

may be expanded to include a ‘central processing facility’

with modules that will accept transported waste from the

region on a fee basis.

Bion has a long-standing relationship with

Kreider Farms including a 2016 joint venture agreement related to these facilities.

Kreider has already made a significant investment

in upgrading its poultry facilities to maximize the treatment and recovery efficiencies that can be achieved with Bion’s

The Kreider 2 project is dependent, in part, on development of a substantial competitively-bid market for long-term

commercial sale of the nutrient reduction credits produced at Kreider 2.

If the competitive procurement is implemented, we intend

to arrange project financing for the initial portions of the Kreider 2 Project during 2021.

Integrated Projects:

While Bion’s 3G livestock waste treatment

technology reduces the environmental impacts from livestock waste, Bion’s comprehensive technology platform provides the

broader integrated response to consumer environmental sustainability concerns.

The adoption of Bion’s platform integrates

to varying degrees of the overall livestock production cycle from crop production to processing.

Projects utilizing the Bion 3G

Tech platform will be able to create cost-effective, verified data-based responses to consumer sustainability and food safety concerns.

Without such integration, adoption of livestock waste treatment technology in a vacuum will not address the various growing consumer

concerns (such as animal health and worker safety issues) related to livestock agriculture.

We believe that Bion’s technology also

creates the opportunity to enter joint ventures with livestock and other agriculture industry entities (“JVs”) to develop

Integrated Projects that profitably integrate large-scale CAFO's production with their feed producers (some of whom may utilize

Bion’s organic fertilizers), downstream food processing facilities, and in certain applications, biofuel/ethanol production.

The Bion 3G technology platform will provide treatment of, as well as renewable energy and co-product recovery/production from,

the CAFO and/or food processing waste streams, on-site utilization of some or all of the renewable energy generated (and potentially,

biofuel/ethanol production), in an environmentally and economically sustainable manner that reduces the aggregate capital expense

and operating costs for the entire integrated complex while increasing production efficiencies and generating supplemental revenue

Sustainable/ Organic Grain-Finished Beef

Bion believes there is a potentially large opportunity

for JVs to produce sustainable/organic grain-finished beef.

Beef production is the most challenged sector of the

livestock industry, due to its size and inability, as currently structured, to respond to growing consumer concerns related to

The Kreider Poultry JV project (“Kreider

or Kreider Poultry”) (discussed below) is an example of such a Retrofit Project.

c) Licensing and/or joint venturing of Bion’s technology and applications, primarily targeted outside

North America.

In both categories a) and b) above, the Company intends

to directly participate (whether by joint venture agreement or other contractual arrangements) in the revenues of the Retrofits and Projects.

The opportunities described in categories a) and b)

above each require substantial political and regulatory (federal, state and local) efforts on the part of the Company and a substantial

part of Bion’s efforts are focused on such political and regulatory matters.

Bion currently intends to pursue the international

opportunities primarily through the use of consultants with existing relationships in target countries.

At this time, our primary focus is on categories a)

and b) above, using our 3G Tech to develop new (or expanded) large-scale Projects with strategic partners (including the Kreider 2 Project)

on a joint venture (or other participating contractual form) basis.

Bion’s business model opens up the opportunity for JVs in various

forms, based upon the revenue generated by our 3G Tech platform from nutrient reductions, fertilizer co-products and renewable natural

gas (which revenue streams will be secured through long term take-off agreements for each of these co-products) providing initial support

for financing of required capital expenditures (whether equity or debt).

We anticipate that these revenue streams will be supplemented

by revenue realized from long-term premium pricing resulting from the sustainable branding opportunity.

We believe that, over time, the

branding opportunity may provide the single largest contribution to the overall economic opportunity enabled by Bion’s 3G Tech platform

and business model.

Initial 3G Tech Project:

Sustainable Beef Demonstration Facility

During the 2021 fiscal year, Bion completed a series

of core optimization trials of its 3G Tech platform that were required to move forward with its initial commercial scale 3G Tech project.

As described in more detail above, Bion recently executed agreements related to development a sustainable beef demonstration facility

on approximately four (4) leased acres near Fair Oaks, Indiana.

The project, as presently planned, will include a covered barn for up

to 300 head of cattle, designed to allow daily manure production to flow into Bion’s 3G Tech waste treatment/resource recovery platform

that includes an anaerobic digester (“AD”) to generate biogas and CO2, followed by Bion’s patented 3G Tech ammonia recovery

process to produce organic ammonium bicarbonate and nutrient-rich solids.

Sustainable/Organic Corn-Finished Beef Opportunity

is the largest producer of beef (and

veal) in the world, accounting for 11.5 million tons out of 61.5 million tons produced worldwide in 2020.

Per capita beef consumption

was approximately 70 pounds in 2020, up from 55 pounds in 2011.

Annual cash receipts for all U.S.

‘cattle and calves’

were lower at approximately $62 billion in 2020, with 2021 receipts anticipated to be higher (and back in line with recent years) at $66

Retail sales of fresh beef in the U.S.

in 2020 were $30.2 billion.

In 2020, there were approximately 93.8 million cattle and

calves in the U.S., with 14.7 million on feed.

Of those cattle on feed, 81.4 percent were in feedlots with a capacity over 1,000 head.

Beef production is the most challenged sector

of the livestock industry, due to its size and inability, as currently structured, to respond to growing consumer concerns related to

sustainability and food safety.

The industry is structured to produce multiple levels of a commodity products (without any significant

pricing premiums) graded based upon taste and tenderness.

Today, however, consumer demand is shifting to products that are more

sustainable, regarding carbon footprint, impacts to air and water and other metrics.

The result has been an opening for disruptive

startups, including Beyond Meat and Impossible Foods, that are backed by large institutional investors and offer plant-based (in

part) meat substitutes.

The beef industry is highly fragmented, and it is designed to produce multiple levels of commodity products

(without any significant pricing premiums) that are graded based on marbling (fat) that determines taste and tenderness.

Further, during

its several decades of growth, the industry has avoided significant environmental regulation, and instead, has externalized its environmental

costs by returning its waste to crop fields, where much of it is ‘flushed’

Today, however, consumer demand is

shifting to products that are more sustainable, regarding carbon footprint, impacts to air and water, and other metrics.

The result has

been an opening for disruptive startups, including Beyond Meat and Impossible Foods, that are backed by large institutional investors

and offer plant-based (in part) meat substitutes.

The CEO of Impossible Foods has made bold claims that the $100B-plus (U.S.

alone) meat industry will be

obsolete in 15 years.

The Company disagrees --- but such competition provides opportunities for Bion.

The Company doesn’t think the consumer wants to

‘blow up’

industry will be obsolete in 15 years.

Bion disagrees --- but such competition provides and highlights opportunities for us.

The Company doesn’t think the consumer

wants to ‘blow up’

the beef industry, which is responsible for the best and safest beef available in the world today (as well

as the livelihoods of almost 800,000 farming, ranching and other families supported by the beef industry in the U.S).

Rather, consumers

want it to be more sustainable --- and still taste good .

Nor do market studies

bear out the concept that consumers want to replace the current supply chain.

Rather, the studies indicate that consumers want the supply

chain to be more sustainable --- and still taste good .

Bion believes that strong demand exists for a verified sustainable

beef product, with the taste and texture of traditional corn-fed beef which addresses the consumers’

technology platform is designed to enable livestock producers to produce an environmentally sustainable beef product.

worked with the USDA’s Process Verified Program (“PVP”) to establish a USDA-certified sustainable brand.

previously achieved conditional approval (for its 2G Tech pending resubmission and final inspections) for USDA brand certification

that would initially include verified reductions in carbon, nutrients, and pathogens.

The Company is confident that its 3G Tech

will support a PVP brand for products of both sustainable and/or organic beef JVs.

We are moving forward with preliminary pre-development

work on a JV to build a state of the art beef cattle operation in the Midwest U.S.

The project would produce corn-fed USDA-certified

organic- and/or sustainable-branded beef.

Organic beef would be finished on organic corn (vs grass fed), produced using the ammonium

bicarbonate fertilizer captured from the cattle’s waste.

We believe Bion’s unique ability to produce fertilizer for

growing of a supply of low-cost organic corn, and the resulting opportunity to produce organic beef, will dramatically differentiate

us from potential competitors.

This organic opportunity is dependent on successfully establishing Bion’s fertilizer products

as acceptable for use in organic grain production.

In addition, as described above, we intend to develop

JVs which use Bion’s organic ammonium bicarbonate fertilizers to support organic grain production.

This grain can be fed

(in the finishing stage) to livestock and raise organic beef (and beef products) that will meet consumer demand with respect to

sustainability and safety and provide the tenderness and taste American consumers have come to expect from premium American beef.

Such a product is largely unavailable in the market today.

Bion views such Integrated Projects as likely

comprising parties including:

a) Bion, b)capital market financing providers, c) participating organic grain producers, d) cow calf

operators, e) cattle feedlot operators and f) slaughter/processing plants.

Bion’s model will enable each market segment to

generate greater profitability for essentially performing the same basic services as part of an integrated program rather than

the present fragmented industry model.

Providing an organic corn producer with sufficient ammonium bicarbonate to support a higher

yield per acre in return for a share of the excess yield value is one example of integration.

Bion’s current long-term goal is to enter

in to JVs to commence development of a number of integrated beef projects in the Midwest over the next 24 to 48 months.

We anticipate

that different projects will be integrated to different degrees and in different manners.

Bion, as developer of, technology provider

to, a participant in its Integrated Projects, anticipates that it will share in the cost savings and revenue generated from the

benefits of integrated activities, including the potential for premium pricing due to sustainable branding.

Note that, in addition to the organic beef opportunity,

Bion’s 3G Tech can also support sustainable beef, with a dramatically reduced nutrient (water), carbon (air), and pathogen

footprint with USDA PVP certified branding.

The Company also intends to pursue this opportunity.

A material portion of the Company’s current activity

is focused on activities needed to be completed to support these opportunities

We anticipate that most JV Projects (including

Integrated Projects) undertaken by the Company in which we retain ownership interests will be pursued through and owned by

single project subsidiaries.

Bion PA 1 LLC (“PA1”), through which the Kreider 1 System was developed at the Kreider

dairy, and Bion PA 2 LLC (“PA2”), through which we are pursuing development of the Kreider JV and the Kreider 2 poultry

waste Project, are the first two of what are likely to be many such entities.

beef product that is real meat, with the taste and texture of traditional corn-fed beef, but which addresses consumers’

sustainability

Bion’s technology platform is designed to produce such an environmentally sustainable beef (and other meat) product.

previously achieved conditional approval (for its 2G Tech pending resubmission and final inspections) for USDA brand certification that

would initially include verified reductions in carbon, nutrients, and pathogens.

The Company is confident that its 3G Tech will support

a PVP brand for products of sustainable and organic beef JVs.

Market studies indicate there is potentially

a large, currently unserved, market for sustainable/organic corn-finished beef;

and further, that this is a long term and growing trend.

Bion believes its 30 years of experience and expertise in livestock waste management, coupled with its state-of-the-art 3G Tech platform

and first-mover advantage, put the Company and its selected JV partners in a unique position to develop the most environmentally and economically

sustainable animal protein production facilities possible today.

The Company is unaware of any other technology and/or business model

that can offer the same level of comprehensive treatment of livestock waste, produce high value coproducts, and deliver a sustainable

brand that can provide an industry response to counter today’s anti-meat messaging, along with the inroads in the animal protein

market being made by alternative protein competitors.

‘Sustainable’

and ‘organic’

are two separate and distinct designations and represent different markets and consumers.

While the markets and consumer demographics

may overlap, it is assumed for purposes of Bion’s analysis and planning that the market for sustainable beef will be larger but

command a smaller pricing premium;

while the market for organic will be smaller but command a substantially larger premium and be somewhat

costlier to produce.

Note that in the sustainable and organic markets targeted by Bion, ‘corn-finished’

is a constant.

believes, and the market has demonstrated, that delivering the same taste and texture that consumers expect in American beef and other

meat products is a key to successful market acceptance, within both the sustainable and sustainable organic markets.

The success of grass-fed/organic

ground beef vs that of grass-fed/organic steaks demonstrates that palatability, as well as price, is a key criterion in whether a consumer

chooses sustainability.

Bion’s 3G Tech platform supports production of beef products that check all the boxes:

sustainable, expected

taste/texture, and affordable.

Bion believes there is an opportunity to essentially

‘reinvent’

a portion of the beef production supply chain to provide at least a premium segment of the market with an affordable

product that satisfies consumers’

sustainability concerns.

Further, that the opportunity is large in scope and of sufficient duration

and potential economic upside to warrant the investment of significant capital and resources.

We expect our anticipated project development

timeline us and our JV partners to be first to market with a sustainable/organic beef product at scale.

The ability to deliver a large

supply of a consistent product will be critical to the large retail distribution partners Bion will seek to include in its JVs.

Our first-mover

advantage should allow us to capture a significant portion of the early adopters in what market studies indicate is a potentially large,

and essentially unserved, market.

In parallel with the beef demonstration project

described above, we continue to move forward with preliminary pre-development work on a JV to build a large-scale state-of-the-art beef

cattle feeding operations in the Midwest U.S.

The projects would be developed to produce a supply of corn-fed beef that is a mixture of

both USDA PVP-certified sustainable and sustainable-organic brands.

Bion believes that once it has demonstrated successful commercial

scale operations at its beef demonstration facility and obtained approval of its current OMRI application for AD Nitrogen, it will be

able to move forward with its first large scale sustainable/organic beef JV during the 2022 calendar year.

Bion intends to pursue its ‘beef opportunity’

in a series of large-scale JV projects, which will be based on construction of 10 modules housing approximately 15,000 head each, for

a total of 150,000 head per project.

Bion anticipates that these JVs would be comprised of parties that could include a) Bion, b) capital

market/financing providers, and c) strategic industry partners who would be equity participants.

The supply chain would include participating

a) organic corn producers, b) cow-calf operators, c) cattle feedlot operators, d) slaughter/processing plants, and e) retail distribution

partners subject to standards and controls.

Bion’s model will enable each segment of the supply chain to generate greater profitability

as part of an integrated program, rather than the present fragmented industry model, for essentially performing the same basic services.

One example of such integration is providing an organic corn producer with sufficient ammonium bicarbonate to support a higher yield per

acre, in return for a share of the excess yield value and a production purchase commitment.

Bion plans to begin development of the first

modules of its initial large-scale beef projects in late 2022 based on results from its Initial Project (discussed above).

currently has a goal to develop and establish production at four to six such beef projects in production (at least in part) over the next

five years, with a target capacity goal for this business segment in the range of 600,000 - 900,000 head.

Based on the 14.7 million cows

on feed in the U.S.

in 2020, this would represent market penetration of four to six percent.

Bion recently published a brief white paper

on its beef opportunity (which speaks as of its date), including economic models, which is available for review or download on the Company’s

website at https://bionenviro.com/bions-beef-opportunity/.

Retrofit 3G Tech Project:

Kreider Poultry

JV (“Kreider 2”)

The JV Kreider 2 3G Tech project is intended

to treat the waste from Kreider Farms’

approximately six million egg layer chickens (with capacity for an additional three million

layers)( and potentially 1,600 dairy cows).

The Project will be designed for an initial capacity of 450 tons per day of waste and will

remove nitrogen and phosphorus from the waste stream that will be converted into high-value coproducts instead of polluting local and

downstream waters.

The Project is planned to be built in multiple phases and may be expanded to include a ‘central processing facility’

with modules that will accept transported waste from the region on a fee basis.

Bion has a long-standing relationship with Kreider

Farms, including a 2016 joint venture agreement related to these potential facilities.

Kreider has already made a significant investment

in upgrading its poultry facilities to maximize the treatment and recovery efficiencies that can be achieved with Bion’s technology.

Note, however, that the Kreider 2 project is dependent, in part, on development of a substantial competitively-bid market for long-term

commercial sale of the nutrient reduction credits produced at Kreider 2 (or another form of payment for ecosystem services).

viable competitive procurement program for nutrient credits or similar program is implemented in PA, we intend to move forward on the

development of the initial portions of the Kreider 2 Project during the subsequent year.

Certain matters related to Kreider 2 are discussed

below at “Kreider Poultry Joint Venture and Pennsylvania and Chesapeake Bay Initiatives”.

Policy Change is Coming

Because Bion believes that policy change is coming,

we continue to work with an array of stakeholders, including national representatives of the livestock industry, to support establishing

new market driven strategies to allow the private sector, including the livestock industry, to provide low-cost large-scale verifiable

solutions to our Nation’s clean water challenges.

There are many states that face similar (or worse) to Pennsylvania’s livestock

waste-related pollution issues, and they will be forced to adopt new strategies, as well.

When competitively-bid markets for nutrient

reductions (and/or other means to monetize environmental benefits) become fully established, Bion anticipates a robust opportunity to

use its 3G Tech-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

Bion's 3G Tech can provide a solution to a significant

portion to the livestock problem discussed above because it prevents the uncontrolled release to the environment of most of the nutrients

from the CAFO waste stream, while treating the waste stream and recovering a substantial portion of those nutrients for value-added commercial

Our technology platform largely eliminates ammonia emissions, other substantial greenhouse gas emissions, odors and other

harmful air pollutants.

Additionally, the platform destroys virtually all pathogens in the waste stream that have been linked to foodborne

illnesses and growing antibiotic resistance.

Similar to point-source treatment, such as provided by an industrial or municipal wastewater

treatment plants, the performance of Bion’s technology platform can be precisely monitored, measured and quantified (in contrast

to the modeled, in-exact - and so far, disappointing - results from modeled BMPs).

Third-party data from our facilities can provide the

basis for verified environmental credits, and related revenues, as well as sustainable branding claims.

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.

About half of U.S.

are now fertilized with raw, untreated manure.

However, approximately 75 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 our 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

The actual question for public policy concerns developing sources of new revenues which will enable the livestock industry to offset

the implementation costs for the cleanup.

Despite trends toward concentration in segments over

the last several decades, the U.S.

animal-protein industry 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.

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 approximately

$110 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 verified air

and water quality solutions compared to current strategy.

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.

NOTE, THAT THE CURRENT COVID-19 PANDEMIC AND RESULTANT

ECONOMIC CRISES AND BUDGETARY CONSTRAINTS APPEAR TO HAVE DELAYED POLICY INITIATIVES RELATED TO THESE MATTERS AT BOTH THE STATE AND FEDERAL

AS A RESULT, IT IS NOT CURRENTLY POSSIBLE TO REASONABLY PROJECT A TIMETABLE FOR ADOPTION OF THE POLICY CHANGES DISCUSSED HEREIN.

However, Bion believes that some opportunity exists

at the federal level in the projected infrastructure spending to create funding for climate and environmental initiatives.

the Phase II Infrastructure proposals under discussion and scheduled to be taken up in the current legislative session include a 30% federal

tax credit to partially offset costs of adoption of environmental technologies such as AD and Bion’s 3G Tech waste treatment technology.

Such an incentive, if passed (of which there is no assurance), would materially impact JV project economics (including the Kreider 2 project).

Note that a bipartisan 2013 Pennsylvania legislative study projected

that creating a competitive bidding program to procure verified nitrogen reductions to meet federal Chesapeake Bay mandates, regardless

of source , could reduce the state’s tax- and ratepayer-funded compliance costs by up to 80 percent (approximately $1.5B annually).

The legislative study was updated in 2018 to reflect new policies.

The updated report projects savings of up to 90 percent.

in the original study, much of the savings were due to low-cost high-impact manure control projects (Bion’s technology figured prominently

in the report).

Senate Bill 575, which was supported by legislative leadership, national livestock interests and other key stakeholders

(and is consistent with US EPA policies), which would have established a competitive procurement program and unlock some of these opportunities

in PA was passed during June 2019 by the Pennsylvania Senate voted 33 to 17 but one effect of the Covid-19 pandemic crisis has been that

PA funding for new initiatives is largely ‘on hold’

at the present time.

Currently SB 475 and SB 832 which deal with these

matters have been introduced and are pending.

Bion anticipates that after passage of a similar bill in the future (of which there is no

assurance) , PA will establish a competitively-bid market for nutrient credits within twelve months after legislative passage and being

signed into law by the Governor.

See “Pre-3G Tech:

Chesapeake Bay Watershed:

Kreider Farms Projects/Pennsylvania Initiatives”

below for discussion of the history and status of matters in PA.

In a 2017 Letter of Expectation to PA’s

Department of Environmental Protection, US EPA demonstrated its support of a procurement strategy to engage the private sector - as long

as the Credits are verified.

It is noteworthy that US EPA and national livestock industry representatives agree on this strategy.

a procurement strategy is also consistent with USDA and EPA support of ‘Private Partnerships’

and OMB’s guidance that

supports acquiring verified results vs.

financing projects with uncertain outcomes and taxpayer risks.

We believe that such strategies

being developed in Pennsylvania and the Chesapeake Bay, if implemented, are likely to serve as a model for the 40 other states now seeking

solutions to similar water quality problems.

Today, most states face a similar issue---unfunded federal clean water mandates.

Pennsylvania’s

proposed competitive bidding program provides an opportunity to significantly reduce the cost to PA (and a model for other states to utilize

in the future) in meeting such mandates.

Integrated Projects:

While Bion’s 3G livestock waste treatment technology

reduces the environmental impacts from livestock waste, Bion’s comprehensive technology platform provides the broader integrated

response to consumer environmental sustainability concerns.

The adoption of Bion’s platform integrates to varying degrees of the

overall livestock production cycle from crop production to processing.

Projects utilizing the Bion 3G Tech platform will be able to create

cost-effective, verified data-based responses to consumer sustainability and food safety concerns.

Without such integration, adoption

of livestock waste treatment technology in a vacuum will not address the various growing consumer concerns (such as animal health and

worker safety issues) related to livestock agriculture.

We believe that Bion’s technology also creates

the opportunity to enter joint ventures with livestock and other agriculture industry entities (“JVs”) to develop Integrated

Projects that profitably integrate large-scale CAFO's production with their feed producers (some of whom may utilize Bion’s organic

fertilizers), downstream food processing facilities, and in certain applications, biofuel/ethanol production.

The Bion 3G technology platform

will provide treatment of, as well as renewable energy and co-product recovery/production from, the CAFO and/or food processing waste

streams, on-site utilization of some or all of the renewable energy generated (and potentially, biofuel/ethanol production), in an environmentally

and economically sustainable manner that reduces the aggregate capital expense and operating costs for the entire integrated complex while

increasing production efficiencies and generating supplemental revenue streams.

We anticipate that most JV Projects (including Integrated

Projects) undertaken by the Company in which we retain ownership interests will be pursued through and owned by single project subsidiaries.

Bion PA 1 LLC (“PA1”), through which the Kreider 1 System was developed at the Kreider dairy, Bion PA 2 LLC (“PA2”)

through which we are pursuing development of the Kreider JV and the Kreider 2 poultry waste Project, and Bion 3G-1 LLC (“3G1”)

through which our initial 3G Tech beef project will be developed, are the first three of what are likely to be many such entities.

Going Concern:

The Company's consolidated financial statements

for the years ended June 30, 2020 and 2019 included herein have been prepared assuming the Company will continue as a going concern.

The Company's consolidated financial statements for

the years ended June 30, 2021 and 2020 included herein have been prepared assuming the Company will continue as a going concern.

The Company has not recorded significant revenue from operations for either of the years ended June 30, 2021 or June 30, 2020.

The Company has incurred net losses of approximately of $4,553,000 and $2,659,000 during the years ended June 30, 2020 and 2019,

respectively.

The Company had a working capital deficit and stockholders' deficit, respectively, of approximately $10,474,000 and

$15,130,000 as of June 30, 2020.The report of the independent registered public accounting firm on the Company's consolidated financial

statements as of and for the years ended June 30, 2020 and June 30, 2019 includes a "going concern"

explanatory paragraph,

which means that there are factors that raise substantial doubt about the Company's ability to continue as a going concern.

Company has incurred net losses of approximately of $3,451,000 and $4,553,000 during the years ended June 30, 2021 and 2020, respectively.

The Company had a working capital deficit and stockholders' deficit, respectively, of approximately $6,614,000 and $11,445,000 as of June

30, 2021.The report of the independent registered public accounting firm on the Company's consolidated financial statements as of and

for the years ended June 30, 2021 and June 30, 2020 includes a "going concern"

explanatory paragraph, which means that there

are factors that raise substantial doubt about the Company's ability to continue as a going concern.

PRINCIPAL PRODUCTS AND SERVICES

The Company’s primary focus is

on implementing its 3G Tech in JVs (as described above).

The Company’s primary focus is on implementing

its 3G Tech in JVs (as described above).

Therefore, the category ‘

PRINCIPAL PRODUCTS AND SERVICES’

is not fully appropriate.

While the Company may implement some 3G Tech systems on a contractual basis, our business is not primarily

involved in sale or long term direct operations/management of our systems.

The discussion below should be read in the context this

business focus (described in detail above and below).

Bion has invested over $100 million in

its business since 1989, much of which has been expended development of its technologies and technology platform, policy change

initiatives and other activities.

Our 2G Tech (now supplanted by our 3G Tech) was proven at commercial scale and was been reviewed

and qualified for federal loan guarantees under USDA’s Technical Assessment program.

The 2G Tech platform (as will our 3G

Tech going forward) provided verified nutrient credits from wet livestock waste (dairy, beef, and swine) that can be used to offset

US EPA-mandated TMDL requirements.

The Company intends to implement its first 3G Tech systems during the 2021 (current) and 2022

fiscal years.

Our 3G Tech and 3G Tech platform provide the basis for our planned JVs and Projects and therefore constitute our

‘principal products’.

Each Bion system (whether prior 2G Tech

or current 3G Tech) is comprised of several process units combined in a ‘process train’, much like a municipal wastewater

treatment plant.

The platform utilizes a combination of mechanical, biological, and thermal processes and can be configured in

a variety of ways, based on the needs and economics of the location, to provide the level of environmental treatment required,

while separating and aggregating the various components of the waste stream for processing and recovery.

A key attribute of the

Bion platform is that the performance of the systems can be measured, quantified and verified through a proprietary data collection

system, providing a level of oversight and verification similar to waste water treatment facilities.

In addition to providing third-party

verification of reductions for regulatory/credit purposes, the same data can also be used to support the claims of a USDA-certified

sustainable branding.

Bion’s waste treatment solutions are

scalable, proven in commercial operations (2G Tech) and the verified results have been accepted by EPA (for use as a “qualified

offset”), USDA and other regulatory agencies.

appropriate for the Company’s business.

While the Company may implement some 3G Tech systems on a contractual basis, our business

does not primarily involve sale of our systems or long term direct operations/management of our systems.

The discussion below should be

read in the context this business focus (described in detail above and below).

Bion has invested over $100 million in its business

since 1989, much of which has been expended development of its technologies and technology platform, policy change initiatives and other

Our 2G Tech (now supplanted by our 3G Tech) was proven at commercial scale and was been reviewed and qualified for federal

loan guarantees under USDA’s Technical Assessment program.

The 2G Tech platform (as will our 3G Tech going forward) provided verified

nutrient credits from wet livestock waste (dairy, beef, and swine) that can be used to offset US EPA-mandated TMDL requirements.

intends to implement its first 3G Tech systems during the current 2022 fiscal year.

Our 3G Tech and 3G Tech platform provide the basis

for our planned JVs and Projects and therefore constitute our ‘principal products’.

Each Bion system (whether prior 2G Tech or current

3G Tech) is comprised of several process units combined in a ‘process train’, much like a municipal wastewater treatment plant.

The platform utilizes a combination of mechanical, biological, and thermal processes and can be configured in a variety of ways, based

on the needs and economics of the location, to provide the level of environmental treatment required, while separating and aggregating

the various components of the waste stream for processing and recovery.

A key attribute of the Bion platform is that the performance of

the systems can be measured, quantified and verified through a proprietary data collection system, providing a level of oversight and

verification similar to waste water treatment facilities.

In addition to providing third-party verification of reductions for regulatory/credit

purposes, the same data can also be used to support the claims of a USDA-certified sustainable branding.

Bion’s waste treatment solutions are scalable,

proven in commercial operations (2G Tech) and the verified results have been accepted by EPA (for use as a “qualified offset”),

USDA and other regulatory agencies.

Bion’s core processes are protected by nine U.S.

patents and six international

patents, with additional applications pending in the US, EU, New Zealand, Mexico, Brazil, Argentina and Australia.

We do not know

of any other cost-effective technology that provides Bion system’s level of treatment of livestock waste:

dairy, beef, poultry

Note that while revenues from Bion’s 2G platform were 90 percent dependent on developing markets for nutrient

reductions, our 3G Tech systems will generate revenues from multiple co-product streams to supplement revenues from nutrient reductions.

Bion’s 3G Tech platform has been developed

over the past four years to maximize co-product recovery values from large scale facilities (or multiple modular facilities) while

maintaining/improving the level of environmental remediation produced by our 2G systems.

The 3G systems will recover nitrogen from

the CAFO waste stream for production of nitrogen-rich fertilizer products that Bion believes will qualify for certification for

use in growing organic crops (the first approval was received during the 2020 fiscal year) for livestock and human.

3G Tech platform will recover methane that can be conditioned to pipeline quality and will qualify for various credits and subsidies

as clean, renewable natural gas.

These two revenue streams will supplement revenues from nutrient reduction credits and USDA-certified

PVP sustainable branding.

Building upon our 2G Tech and Bion's over 20

years of experience providing waste treatment services to the livestock industry, commencing with our first generation technology

applications, the Company is pursuing the Retrofit opportunity related to environmental remediation of existing CAFOs.

technology has evolved and been upgraded over the decades to meet changing standards and requirements.

While Bion's 3G Tech

platforms creates potentially profitable business opportunities to provide waste treatment services and systems and/or renewable

energy production capability to existing large livestock operations (of which there are many), and potentially to smaller facilities

through aggregation of waste streams.

this is not our primary focus.

Candidates for these solutions include individual CAFO

facilities that face impending regulatory action, CAFOs that wish to expand or relocate, and operations located in regions that

suffer severe and immediate environmental issues, such as the Chesapeake Bay watershed, Great Lakes region and/or the San Joaquin

Valley, where financial incentives (such as nutrient reduction credit trading programs) are (or may become) available that encourage

voluntary reductions of nutrient releases and/or atmospheric emissions from agricultural sources.

Pennsylvania and Chesapeake Bay Initiatives

patents and six international patents, with

additional applications pending in the US, EU, New Zealand, Mexico, Brazil, Argentina and Australia.

We do not know of any other cost-effective

technology that provides Bion system’s level of treatment of livestock waste:

dairy, beef, poultry and swine.

Note that while revenues

from Bion’s 2G platform were 90 percent dependent on developing markets for nutrient reductions, our 3G Tech systems will generate

revenues from multiple co-product streams to supplement revenues from nutrient reductions.

Bion’s 3G Tech platform has been developed over

the past six years to maximize co-product recovery values from large scale facilities (or multiple modular facilities) while maintaining/improving

the level of environmental remediation produced by our 2G systems.

The 3G systems will recover nitrogen from the CAFO waste stream for

production of nitrogen-rich fertilizer products that Bion believes will qualify for certification for use in growing organic crops (the

first approval was received during the 2020 fiscal year) for livestock and human.

Further, the 3G Tech platform will recover methane that

can be conditioned to pipeline quality and will qualify for various credits and subsidies as clean, renewable natural gas.

two revenue streams will supplement revenues from nutrient reduction credits and USDA PVP -certified sustainable branding.

Building upon our 2G Tech and Bion's over 20 years

of experience providing waste treatment services to the livestock industry, commencing with our first generation technology applications,

the Company is pursuing the Retrofit opportunity related to environmental remediation of existing CAFOs.

Our technology has evolved

and been upgraded over the decades to meet changing standards and requirements.

Bion's 3G Tech platform creates potentially profitable

business opportunities to provide waste treatment services and systems and/or renewable energy production capability to existing large

livestock operations (of which there are many), and potentially to smaller facilities through aggregation of waste streams.

However, this

is not our primary focus.

Candidates for these solutions include individual CAFO facilities that face impending regulatory action,

CAFOs that wish to expand or relocate, and operations located in regions that suffer severe and immediate environmental issues, such as

the Chesapeake Bay watershed, Great Lakes region and/or the San Joaquin Valley, where financial incentives (such as nutrient reduction

credit trading programs) are (or may become) available that encourage voluntary reductions of nutrient releases and/or atmospheric emissions

from agricultural sources.

Sustainable/Organic Corn-Fed Beef Opportunity

The Company believes that one of its major opportunities

will be in JVs to pursue the Sustainable Beef Opportunity and the Sustainable/Organic Corn-Fed Beef Opportunity in the Midwest as discussed

at some length above.

It is the Company’s current intention to initiate several JVs pursuing this opportunity as developer of, technology

provider to, and direct participant.

See discussion above.

It is not possible at this time to firmly predict

where the initial JVs and/or Project will be developed or the order in which JVs and Projects will be developed.

All potential JVs and/or

Projects are in very early pre-development stages and may never progress to actual development or may be developed after other JVs and/or

Projects not yet under active consideration.

The Company's successful accomplishment of its

business activities is dependent upon many factors (see 'Forward-Looking Statements' above) including without limitation the following,

none of which can be assured at this date:

Successful development and completion of the first 3G Tech Project(s) to demonstrate the

commercial economics of its 3G Tech platform;

Successful development of the first Integrated Project to demonstrate the operation of a

fully-integrated, environmentally-compliant Integrated Project at a profitable level;

Establishment of a substantial and liquid market for nutrient reductions and other environmental

attributes generated from the Company’s future facilities;

Establishment of marketing relationships needed for realization of full value from the saleable

co-products including sustainable and organic meat products and organic nitrogen fertilizer products;

Successful completion of organic certifications and USDA PVP-certified sustainable brand

Our ability to raise sufficient funds to allow us to finance our activities, JV’s,

and Projects;

Regulatory and enforcement policies at the Federal, State and local levels.

Kreider Poultry Joint Venture and Pennsylvania

and Chesapeake Bay Initiatives

The Kreider 1 2G Tech dairy system in Pennsylvania

in the Chesapeake Bay watershed represented the Company's first Retrofit in this market segment.

This Retrofit installation was

designed and intended primarily to reduce nitrogen and phosphorus releases and ammonia emissions from the dairy waste streams to

generate tradable nutrient reduction credits as part of a nutrient credit trading program through the PA Department of Environmental

Protection (‘PADEP’).

While this project has not been (and most likely will not be) a commercial success on a stand-alone

basis (due to PA’s failure to implement a viable long-term credit trading market), it has demonstrated that Bion’s

manure treatment technology can generate low-cost verified credits, providing the basis of a 2013 PA Legislative Budget and Finance

Committee report (updated in 2018) that supports the use of manure technologies to provide low-cost alternatives to meet Bay mandates.

It is likely that the Kreider 2 poultry waste

treatment Project, which is in its early development and pre-permitting phase, will be one of our first large scale JV Projects.

The Kreider 2 Project will utilize our 3G Tech platform to treat the waste stream from Kreider Farm’s large poultry operations

(possibly together with waste from other nearby poultry operations and/or other waste streams) (and the dairy waste stream previously

treated in the Kreider 1 system) to generate renewable energy, marketable nutrient reduction credits and co-products (including

nitrogen in organic and/or non-organic forms).

It is targeted to treat the waste stream from approximately 9 million birds, in

modules, when fully developed.

Estimated capital costs (‘capex’) are currently in the $60 million range (with the caveat

that no site has yet been chosen, technology development is not complete and the final design work has not yet begun) and has the

potential to generate gross revenues of up to $50 million annually from the multiple revenue streams based on current projected

yields and prices, none of which are assured.

Note that tech and system design work is continuing and the Company anticipates reduce

reductions of both capex and operating costs.

This Retrofit installation was designed

and intended primarily to reduce nitrogen and phosphorus releases and ammonia emissions from the dairy waste streams to generate tradable

nutrient reduction credits as part of a nutrient credit trading program through the PA Department of Environmental Protection (‘PADEP’).

While this project has not been (and most likely will not be) a commercial success on a stand-alone basis (due to PA’s failure to

implement a viable long-term credit trading market), it has demonstrated that Bion’s manure treatment technology can generate low-cost

verified credits, providing the basis of a 2013 PA Legislative Budget and Finance Committee report (updated in 2018) that supports the

use of manure technologies to provide low-cost alternatives to meet Bay mandates.

It is possible that the Kreider 2 poultry waste treatment

Project, which is in its early development and pre-permitting phase, will be one of our first large scale JV Projects if a workable market

for nutrient reduction credits develops in PA, of which there is no assurance.

The Kreider 2 Project will utilize our 3G Tech platform

to treat the waste stream from Kreider Farm’s large poultry operations (possibly together with waste from other nearby poultry operations

and/or other waste streams) (and the dairy waste stream previously treated in the Kreider 1 system) to generate renewable energy, marketable

nutrient reduction credits and co-products (including nitrogen in organic and/or non-organic forms).

It is targeted to treat the waste

stream from approximately 9 million birds, in modules, when fully developed.

Estimated capital costs (‘capex’) are currently

in the $60 million range (with the caveat that no site has yet been chosen, technology development is not complete and the final design

work has not yet begun) and has the potential to generate gross revenues of up to $50 million annually from the multiple revenue streams

based on current projected yields and prices, none of which are assured.

Note that tech and system design work is continuing and the Company

anticipates reduce reductions of both capex and operating costs.

To complete and operate the Kreider 2 project,

substantial capital (equity and/or debt) has been and will continue to be expended.

Additional funds will potentially be

needed to be expended so that the Kreider 1 system and the Pennvest Loan (see below) situation can be resolved, of which there

is no assurance.

The Kreider 1 system was developed to earn revenue primarily from the sale of nutrient reduction (and/or other)

environmental credits.

In contrast, upon successful construction and operation, the Company anticipates that the Kreider 2

Project will earn revenue from the sale of nutrient reduction (and/or other) environmental credits generated by its 3G Tech

system and through sales of renewable energy and co-products (fertilizer nutrients and soil amendment products in organic

and/or non-organic forms and/or renewable energy and environmental credits) recovered.

To date the market for long-term nutrient

reduction Credits in Pennsylvania has been very slow to develop and the Company’s activities have been negatively affected

by such lack of development.

However, Bion is confident that once these markets are established, the Credits it produces

will be competitive in the credit trading markets, based on its cost to remove nitrogen from the livestock waste stream, compared

to the cost to remove nitrogen through various other treatment activities.

Several independent studies have calculated

the average cost to remove nitrogen through various sector practices.

Reports prepared for the PA Senate (2008), Chesapeake Bay

Commission (2012) and PA legislature (2013;

described below), as well as the Maryland Chesapeake Bay Financing Strategy Report

(2015), demonstrate that the cost to remove nitrogen (per pound on average) from agriculture is $44 to $54, municipal wastewater:

Additional funds will potentially be needed

to be expended so that the Kreider 1 system and the Pennvest Loan (see below) situation can be resolved, of which there is no assurance.

The Kreider 1 system was developed to earn revenue primarily from the sale of nutrient reduction (and/or other) environmental credits.

contrast, upon successful construction and operation, the Company anticipates that the Kreider 2 Project will earn revenue from the

sale of nutrient reduction (and/or other) environmental credits generated by its 3G Tech system and through sales of renewable energy

and co-products (fertilizer nutrients and soil amendment products in organic and/or non-organic forms and/or renewable energy and environmental

credits) recovered and sustainably branded products as discussed above.

To date the market for long-term nutrient reduction

Credits in Pennsylvania has been very slow to develop and the Company’s activities have been negatively affected by such lack of

However, Bion is confident that if and when these markets are established, the Credits it produces will be competitive

in the credit trading markets, based on its cost to remove nitrogen from the livestock waste stream, compared to the cost to remove nitrogen

through various other treatment activities.

Several independent studies have calculated the average

cost to remove nitrogen through various sector practices.

Reports prepared for the PA Senate (2008), Chesapeake Bay Commission (2012)

and PA legislature (2013;

described below), as well as the Maryland Chesapeake Bay Financing Strategy Report (2015), demonstrate that

the cost to remove nitrogen (per pound on average) from agriculture is $44 to $54, municipal wastewater:

$28 to $43, and storm water:

$386 to $633.

Pursuant to the PA legislative study, by replacing sector allocation (for all sectors)

with competitive bidding, up to 80 percent savings could be achieved in PA’s Chesapeake Bay compliance costs ($1.5 billion

annually) by 2025.

If the legislative study had focused on the cost differentials of competitive bidding compared only with storm

water, the relative savings would be substantially greater.

Since these studies were completed, most of

the larger (Tier 1) municipal wastewater treatment plants in PA have been upgraded, at a cost of approximately $2.5 billion (vs

initial 2004 PA DEP cost estimates of $376 million).

US EPA is now focused on PA’s storm water allocation (3.5 million pounds)

and has this sector on ‘backstop level actions’, the highest level of EPA-oversight and the final step before sanctions.

In the same 2004 PA DEP cost estimate that led to the more than a $2 billion underestimate/miscalculation in municipal wastewater

plant upgrade costs, the estimate for storm water cost was $5.6 billion.

In April 2017, US EPA sent a Letter of Expectation to

PA DEP, expressing the agency’s support for the use of nutrient credit trading and competitive bidding to engage the private-sector

to lower costs.

The letter specifically encouraged the use of credit trading to offset the state’s looming storm water obligations.

Bion anticipates that it will be able to

profitably sell nutrient credits generated at the the Kreider 2 facilities (and subsequent projects) if prices are in the

range of $8-$12 (or higher) per lb.

Pursuant to the PA legislative study, by replacing sector allocation (for all sectors) with competitive bidding, up to 80

percent savings could be achieved in PA’s Chesapeake Bay compliance costs ($1.5 billion annually) by 2025.

If the legislative study

had focused on the cost differentials of competitive bidding compared only with storm water, the relative savings would be substantially

Since these studies were completed, most of the larger

(Tier 1) municipal wastewater treatment plants in PA have been upgraded, at a cost of approximately $2.5 billion (vs initial 2004 PA DEP

cost estimates of $376 million).

US EPA is now focused on PA’s storm water allocation (3.5 million pounds) and has this sector on

‘backstop level actions’, the highest level of EPA-oversight and the final step before sanctions.

In the same 2004 PA DEP

cost estimate that led to the more than a $2 billion underestimate/miscalculation in municipal wastewater plant upgrade costs, the estimate

for storm water cost was $5.6 billion.

In April 2017, US EPA sent a Letter of Expectation to PA DEP, expressing the agency’s support

for the use of nutrient credit trading and competitive bidding to engage the private-sector to lower costs.

The letter specifically encouraged

the use of credit trading to offset the state’s looming storm water obligations.

Bion anticipates that it will be able to profitably

sell nutrient credits generated at the Kreider 2 facilities (and subsequent projects) if prices are in the range of $6-$12 (or higher)

of nitrogen reduction under long-term contracts, of which there is no assurance.

believes that with the studies and information now available to other states that are (or will shortly be) facing these same decisions,

a cost-benefit analysis will make it clear from the outset that competitive bidding for nutrient reduction credits from alternative

approaches can provide dramatically lower-cost solutions than traditional strategies.

The Company anticipates that the Kreider 2

poultry waste treatment facility in PA will be one of its initial 3G Tech Projects.

Bion intends that it will select a site for

the Kreider 2 Project and/or its initial Integrated Project (and possibly additional Projects) after PA adopts a competitively-bid

nutrient reduction Credit purchase program (see discussion above and below).

Sustainable/Organic Corn-Fed Beef Opportunity

The Company believes that one of its major

opportunities will be in JVs to pursue the Sustainable/Organic Corn-Fed Beef Opportunity in the Midwest as discussed at some length

It is the Company’s current intention to initiate several JVs pursuing this opportunity as developer of, technology

provider to, and direct participant.

See discussion above.

It is not possible at this time to firmly

predict where the initial JVs and/or Project will be developed or the order in which JVs and Projects will be developed.

All potential

JVs and/or Projects are in very early pre-development stages and may never progress to actual development or may be developed after

other JVs and/or Projects not yet under active consideration.

The Company's successful accomplishment

of its business activities is dependent upon many factors (see 'Forward-Looking Statements' above) including without limitation

the following, none of which can be assured at this date:

Successful development and completion of

the first 3G Tech Project(s) to demonstrate the commercial economics of its 3G Tech platform;

Successful development of the first Integrated

Project to demonstrate the operation of a fully-integrated, environmentally-compliant Integrated Project at a profitable level;

Establishment of a substantial and liquid

market for nutrient reductions generated from the Company’s present and future facilities;

Establishment of marketing relationships

needed for realization of full value from the saleable co-products including organic nitrogen fertilizer products;

Successful completion of organic certifications

and USDA-certified sustainable brand ;

Our ability to raise sufficient funds to

allow us to finance our activities, Retrofits and Projects;

Regulatory and enforcement policies at the

Federal, State and local levels.

CAFO INDUSTRY:

PROBLEM AND OPPORTUNITY

(according to the USDA’s

2017 agricultural census) there are over 9M dairy cows, 90M beef cattle, 60M swine and more than 2 billion poultry which provides

an indication of both the scope of the problem addressed by Bion’s technology, as well as the size of the opportunity.

Environmental

impacts from livestock production include surface and groundwater pollution, greenhouse gas emissions and other air pollution,

excess water use and pathogens related to foodborne illnesses and antibiotic resistance.

The greatest impacts come from the manure

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.

More than half of U.S.

production is fertilized in this manner.

Runoff from livestock waste has been identified as one of the largest sources of excess

nutrients in most major watersheds.

Excess nutrients fuel algae blooms nationwide that are increasingly toxic;

dead zones in the

Great Lakes, Chesapeake Bay, and Gulf of Mexico;

and nitrate-contaminated drinking water in a growing number of states including

Pennsylvania, California, Wisconsin, Washington and other states.

US EPA considers excess nutrients “one of America’s

most widespread, costly and challenging environmental problems”.

Nutrient runoff is expected to worsen with rising temperatures

and increasing rainstorm intensity resulting from climate change.

More than half of the nitrogen nutrient impacts

from livestock come from ammonia emissions from the waste.

Nitrogen in the form of ammonia is extremely volatile, reactive and

When airborne ammonia/ nitrogen eventually settles back to the ground through atmospheric deposition - it ‘rains’

Most of this nitrogen enters surface and groundwater.

In the context of groundwater aquifers, it can contaminate drinking

water sources.

It is now well-established that most of the voluntary conservation practices (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 previously was believed to be the case.

This is especially the case with regard to addressing

mobile ammonia emissions because such BMPs are primarily focused on surface water runoff, directly from farm fields in current

production, versus the re-deposition that takes place everywhere.

Further, groundwater (vs surface water) transports

this volatile nitrogen downstream, creating an additional problem, since most of the current conservation practices relied on to

reduce agricultural runoff to our lakes and estuaries are bypassed by this subsurface flow.

Nitrate-contaminated groundwater is

of growing concern in agricultural regions nationwide.

Pennsylvania, Wisconsin, California and Washington, (and other states) all

now have regions where groundwater nitrate levels exceed EPA standards for safe drinking water.

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’

Nutrients from livestock waste runoff fuel

downstream toxic algae blooms and dead zones in the Chesapeake Bay, Gulf of Mexico, Florida Bay, and many other estuaries, as well

as the Great Lakes.

Excess nutrient runoff also impacts local- and fresh-water resources, producing algae blooms in lakes and rivers

and contaminating underground aquifers that supply drinking water.

The impacts of livestock production on public health and the

environment are coming under increasing scrutiny from environmental groups and health organizations, regulatory agencies and the

courts, the media, consumers and activist institutional investors.

Over the last several decades the livestock

industry ‘specialized’, essentially decoupling from crop farming, and began developing increasingly larger facilities,

which are often in close proximity, to improve production efficiencies.

CAFOs are now responsible for 70-80% of U.S.

animal protein

The unintended consequence of increased scale, together with concentration in certain geographies, has been to overwhelm

nature’s ability to absorb nutrients and mitigate other impacts from animal waste.

Nutrients from livestock waste enter the environment

primarily through direct runoff (after ground application) or atmospheric deposition of nitrogen from ammonia emissions, after

which they contaminate groundwater and surface waters.

Livestock waste has now been acknowledged as one of the largest sources

of excess nutrients that cause toxic algal blooms and dead zones in our waters, in addition to being a large source of greenhouse

gases and ammonia, and pathogens that have been linked to food-borne illnesses and antibiotic resistance.

A major study, completed

in May 2016 by Colorado State University in collaboration with US EPA and the National Park Service, determined that ammonia

emissions (from livestock and nitrogen fertilizers) have surpassed NOx emissions (from automobiles and power plants) as the largest

source of problem nitrogen cycling from the atmosphere to the biosphere.

The same manure that is degrading our environment

also represents lost opportunities for the industry.

Spreading manure is a tremendous waste of the energy and most of the valuable

nutrients it contains.

Only about 25 percent of the highly-reactive and mobile nitrogen in manure is available to crops when applied

as fertilizer;

the rest is lost to runoff and/or volatilization to the atmosphere as ammonia or other gases.

Further, in order

to achieve the desired level of nitrogen via manure application, phosphorus must be over-applied, which is both wasteful and harmful

to soil health and waters to which it migrates.

Bion’s technology platform provides direct treatment of the waste stream

release to the environment) that separates its various components so that they can then be processed into value-added byproducts,

thereby allowing the energy, nitrogen, phosphorus and micronutrients to be utilized independent of each other.

The traditional business model for CAFO's,

regardless of livestock type, has relied on a combination of:

1) a passive environmental regulatory regime (including exemptions

pursuant to certain statutes), and 2) access to a relatively unlimited supply of cheap land and water to serve as the basis for

"environmental"

treatment of animal waste.

Such land and water resources have now become significantly more expensive

and, due to climate/weather variations, less reliable.

Further, ongoing consolidation of the CAFO industry has produced substantially

increased and more concentrated waste streams.

At the same time, regulatory scrutiny of, and public concern about, food safety

and the health and environmental impacts from CAFO's has intensified greatly as the occurrence of downstream and local impacts

has become more commonplace.

The production of animal

protein (meat and dairy) in the United States (and elsewhere) now faces substantial constraints due to environmental pollution

problems (primarily air and water), public health concerns, resource limitations (land, water and energy), input cost volatility

and increases (feed, fuel, etc.), product price volatility and, potentially, weather variability and climate change.

Each of these

issues negatively affect both the current profit levels and the future activities of the industry as presently structured.

Spreading a billion tons of manure annually on fields and crops for fertilizer, is both a tremendous waste of resources and contributes

to several widespread and costly environmental and public health impacts.

Based on current estimates and practices, the annual

environmental remediation costs of the nitrogen impacts from a dairy cow in Lancaster, Pennsylvania to the Chesapeake Bay range

from $1,200 to $4,000 (depending on cleanup sector) while generating only $150 to $400 in net income (at current milk prices).

Onsite waste treatment such as Bion’s can reduce that nutrient reduction cost by 60-80% (or more) while generating measurable

local environmental benefits whose economic value in many cases will exceed the Bay nutrient reduction costs.

Bion believes that

its technologies (and its technology platform) can not only remediate/mitigate many of these problems, but can also be a catalyst

for the substantial relocation, rationalization and modernization that is currently needed by the livestock industry in the U.S.

Agricultural runoff (including atmospheric

deposition of nitrogen from livestock-related ammonia emissions) is one of the largest water pollution problem in the United States.

Agricultural release of nitrogen and phosphorus into rural watersheds negatively impacts water quality and increases remediation

costs, not only for local waterways and aquifers, but also for downstream water bodies and urban areas.

Over-application of animal

waste to cropland has resulted in manure nutrients polluting surface and ground water systems, adversely impacting fresh and salt

water quality throughout the country, including the Chesapeake Bay, the Great Lakes and the Gulf of Mexico.

Clean-up initiatives for the Chesapeake Bay,

the Great Lakes and elsewhere are requiring the expenditure of substantial sums of money to reduce excess nutrient pollution and

resultant algal blooms.

In each such case, agriculture in general--and CAFO's in particular--have been identified among the

main contributors of pollution.

CAFO's are also recognized as a significant source of harmful air emissions and odors.

CAFO's have been identified as the largest contributor to airborne ammonia and other polluting gases in the San Joaquin Valley

in California and elsewhere.

They are also among the largest contributors to nutrient pollution of the Chesapeake Bay.

A substantial volume of the nitrogen released

to the atmosphere from CAFOs and their waste streams originates as ammonia and other nitrogen gas emissions, which is subsequently

re-deposited to the ground, adding to the nitrogen loading to surface and ground water systems.

Ammonia emissions also contribute

to the formation of PM2.5, small inhalable particulate matter that is a well-recognized health risk.

Further, untreated manure

from CAFO’s utilized as fertilizer has been linked to pathogens that cause food-borne illnesses, as well as the spread of

antibiotic-resistant bacteria, such as MRSA.

Bion believes that its patented and proven

technologies offer the only comprehensive solution to the environmental impacts of these concentrated livestock waste streams.

We believe Bion's technologies can enable animal

protein production to take place in a manner which is both economically and environmentally sustainable, because our technology

removes nutrients from the waste streams generated by animal operations at the source while it is still concentrated.

thereby dramatically reduces releases to water and gaseous atmospheric emissions in a cost-effective manner.

The potential

resulting herd concentration increase (due to lower pollution) will reduce marginal costs of production for the CAFO’s.

unavailable locations close to markets, feed and other needed inputs may become available due to the reduced pollution created

by our technology.

Also, it results in a core Bion technology platform that can enable substantial integration of environmental

treatment, renewable energy and by-product production, and/or animal protein processing operations, and/or biofuel/ethanol production,

thereby creating the basis for the Company's Integrated Projects business opportunity.

Bion’s 3G Tech platform will provide

comprehensive onsite waste treatment and substantially greater value co-product recovery capabilities at very large-scale production

facilities (‘Projects’).

The 3G Tech platform will recover renewable energy and nitrogen (that can be processed into

a high-value natural and/or organic nitrogen fertilizer product), while simultaneously offering cost-effective solutions to several

pressing environmental and public health issues.

Bion’s 3G Tech Project JV business model

is applicable to existing large scale installations (such as the Kreider poultry operations in PA), newly established CAFO complexes,

and/or, potentially, ‘central waste processing facilities’

that serve multiple geographically-close CAFO facilities,

is based on revenue from the sale of 1) financial products generated in the course of Bion’s 3G Tech waste treatment

a) nutrient reduction credits, b) renewable energy-related credits and c) other environmental credits;

2) co-products,

including a) ammonium bicarbonate fertilizer (liquid and solid crystal), b) other fertilizer/soil amendment products, and 3) renewable

natural gas (“RNG”);

and 4) revenues from premium pricing/license fees due to sustainable branding.

Based on pilot

study results over the last 24 months related to the 3G Tech platform (and assuming such pilot results are achievable at commercial

scale), Bion’s management currently estimates that in a commercial-scale Bion 3G Tech Project (such as the proposed Kreider

2 poultry waste treatment facilities or a large scale beef project of equivalent size) that there will be four large revenue streams

(based on currently projected pricing and yields (of products and/or verified credits), which may vary in the future, each category

would contribute between 25%-45% of the gross revenues):

sales of verified nutrient

reductions (when competitive bidding markets mature);

sales of nutrient/soil

amendment co-products (which will require building distribution with industry partners, regulatory certifications (including

organic certification), field trials and market acceptance);

sales of RNG (and related

increased livestock sales

revenue (premium pricing and/or brand licensing fees) from sustainable branding based on implementation of Bion’s 3G Tech.

Assuming that Bion can accomplish the tasks

above, we believe that in some fully built-out JV Projects, any two of the above revenue categories may be sufficient to support

debt service and operating costs , based upon current estimated CAPEX and OPEX costs, and achieve profitability when three revenue

streams can be realized by a particular Project (without consideration of cost savings and/or additional revenue streams potentially

available as the result of full integration).

There are many risks associated with these

projections, but Bion’s management is cautiously optimistic that the challenges will be met as the initial Projects are developed.

The Company is involved in ongoing technology

development work with regard to:

1) Ammonium Nitrogen Recovery (plus residual soil amendment production)

our 3G Tech work, since 2015 Bion has filed patent applications for our processes that recover a natural nitrogen fertilizer product

without the use of chemical additives or processes.

Two patents have been granted related to our 3G Tech and a Notice of Allowance

from the US Patent and Trademark Office (“USPTO”) was recently received regarding a third patent (expected to be issued

later in 2020).

Organic co-products consist of concentrated ammonia liquid, ammonium bicarbonate crystal solids and residual solids

from the evaporation/distillation process utilized to process the discharge from a customized front-end anaerobic digester (See

“Patents”).

Bion anticipates seeking organic certifications/approvals for its ammonia bicarbonate fertilizer products

(first OMRI approval for a low concentration ammonium bicarbonate liquid product was obtained during fiscal year 2020) for use

in growing of organic feed crops and/or organic food.

The solid fertilizer product is intended to contain 12 to 16 percent

nitrogen in a solid crystalline form that is water soluble and provides readily-available nitrogen.

It will contain none of the

phosphorus, salt, iron and other mineral constituents found in many organic fertilizers and also in the livestock waste stream

(which may be separately recovered).

Instead, the nitrogen recovered from Bion’s process will be in an industry-standard

yet pure form that can be precision-applied to crops using existing practices and is intended to be suited to greenhouse, hydroponic

and indoor vertical farming applications.

Successful OMRI (and/or other) certifications/approval, if achieved, for the product’s

use in organic crop production will provide Bion with access to a higher value market for the product than the synthetic nitrogen

The ability to generate concentrated ammonium bicarbonate in large scale and at low cost will potentially open significant

opportunities in existing and future unique markets such as corn-fed organic beef, vertical farming and potentially organic cannabis.

Both the ammonium bicarbonate and the residual solids will require OMRI (or other institutional) review and approval for their

use as certified fertilizer products in organic farming operations.

2) Renewable Energy/Credits

Bion’s 3G Tech platform incorporates

anaerobic digestion (“AD”) (following pre-treatment) to recover methane from the volatile solids in the CAFO waste

At sufficient scale, methane can be cost-effectively conditioned and injected into existing pipelines, resulting in a renewable

compressed natural gas.

Federal programs to support renewable energy production include a 30 percent Biogas Investment Tax Credit

(ITC) for qualifying biogas technologies and the Renewable Fuel Standard program that provides ongoing renewable energy credits

for the production and use of renewable transportation fuels.

Livestock waste is one of the largest contributors of methane

and nitrous oxide emissions, two of the most potent greenhouse gases.

Under California’s carbon cap-and-trade program, eligible

credits are currently being purchased from dairy farms located anywhere in the U.S.

that utilize AD.

Bion intends to file an application

to include beef manure and poultry layer manure (such as will be processed at Bion’s Kreider 2 poultry waste treatment facility),

as an eligible feedstock as part of the development process for JV Projects.

3) Sustainable Branding

During December 2015, Bion submitted its branding

application to the USDA Agricultural Marketing Services’

Process Verified Program (“PVP”) to certify a number

of verifiable environmental and public health benefits associated with the application of Bion’s 2G Tech to livestock production

facilities utilizing our 2G Tech.

The initial application included reductions in both nitrogen and carbon footprint, as well as

Licensing Bion’s brand, if approval is received, will allow producers that utilize Bion’s technology to

differentiate themselves to consumers who are becoming increasingly more sustainability- and safety-conscious in their food choices.

Bion’s Kreider 1 application received initial stage approvals by USDA, pending site-specific audits.

We intend to file applications

to include the utilization of our 3G Tech as JVs proceed toward development.

4) Nutrient Reductions

Public expenditures on clean water from federal,

state and local ratepayers are rising rapidly while overall water quality continues to decline.

Harmful algal blooms that block

sunlight and lead to ‘dead zones’

are occur regularly in the Chesapeake Bay, Great Lakes, Gulf of Mexico and many other

Toxic algal blooms, like the 2014 Lake Erie bloom that shut down Toledo, Ohio’s water supply for several days,

occur with increasing frequency.

High nitrate levels in water wells located near livestock production are also increasing.

waste has been acknowledged as one of the largest sources of excess nutrients.

A task force of EPA and state officials described

excess nutrients as having the potential to become “one of the costliest, most difficult environmental problems we face in

the 21st century.”

In 2010 US EPA established the Chesapeake Bay regulations that require substantial reductions in nutrients

and sediment from the six Bay states and Washington, DC.

This is the first watershed-wide, multi-state regulation of U.S.

Compliance cost estimates vary widely, from $30 to $50 billion.

Bion’s technology will capture most of the

nutrients from a livestock production facility, providing large-scale nutrient reductions at a fraction of the cost of traditional

agricultural or downstream treatment.

Bion’s long-term objective

is to focus the use of its 3G technology, branding and organic co-product revenues to develop large-scale livestock production

JV Projects that consolidate, either by direct ownership or joint venture, the revenues from livestock production and Bion’s

platform-related revenue sources.

Note that appropriate housing for beef cattle (replacing open feedlots) will represent a significant

percentage of the cost in the case of Projects involving beef production and will be required to collect the waste in an efficient

manner in order to generate renewable energy and nutrient credits.

However, the Company believes the such housing will significantly

increase livestock production net income (due to efficiencies in rate of weight gain, improved mortality rates and other documented

factors) and that premium pricing of even 5-7% at the wholesale level resulting from a USDA-certified ‘environmentally sustainable’

brand will have a dramatic positive impact on the overall economics of production.

Further, we project that the potential revenue

streams associated with organic co-products and sustainable branding will provide key long-term value opportunities that will drive

such Projects.

The current Administration’s

US EPA and USDA strongly support a market-driven strategy that will engage the private sector to provide innovative solutions to

reduce costs.

Proposed cuts to federal funding are likely to accelerate movement by the EPA and/or multiple states toward competitive

bidding and other lower cost approaches to environmental cleanup.

Nutrient reduction credit trading and/or procurement programs

are already being evaluated and proposed in many states.

They would allow verified reductions from unregulated sources, such as

agriculture, to be used to offset federal requirements, in lieu of dramatically higher-cost infrastructure projects, such as municipal

wastewater and storm water treatment.

Nutrient reductions from Bion’s manure treatment technologies can be verified and achieved

at substantially less cost than traditional infrastructure solutions, as well as today’s voluntary agricultural conservation

Additionally, treating livestock waste at its source also provides many benefits to the local environment and community

that cannot be achieved with downstream treatment.

Bion further believes that with the studies

and information now available to other states that are (or will shortly be) facing these same decisions, a cost-benefit analysis will

make it clear from the outset that competitive bidding for nutrient reduction credits from alternative approaches can provide dramatically

lower-cost solutions than traditional strategies.

The Kreider 2 poultry waste treatment facility in

PA may be one of its initial 3G Tech Projects.

Bion intends that it will select a site for the Kreider 2 Project and/or its initial Integrated

Project (and possibly additional Projects) after PA adopts a competitively-bid nutrient reduction Credit purchase program (see discussion

above and below).

CORPORATE BACKGROUND

The Company is a Colorado corporation organized

on December 31, 1987.

Our principal executive offices are 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.

telephone number is 516-586-5643.

We have no additional offices at this time as all employees and primary consultants work from

their home offices.

The Company is a Colorado corporation organized on

December 31, 1987.

Our principal executive offices are 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 516-586-5643.

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.

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.

inactive Colorado corporation organized June 3, 1996).

Bion is also the parent of Bion PA 1 LLC (a Colorado entity organized

August 14, 2008) (“PA1”) and Bion PA 2 LLC (a Colorado entity organized June 24, 2010) (“PA2”).

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").

("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 1 LLC (a Colorado entity organized August 14, 2008) (“PA1”),

Bion PA 2 LLC (a Colorado entity organized June 24, 2010) (“PA2”) and Bion 3G-1, LLC (a Colorado entity organized on September

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").

Although we have been conducting business since 1989,

we determined that we needed to redefine how we could best utilize our technology during 2003.

From 2003 through early

2008, we primarily worked on technology improvements and applications and in furtherance of our business model of Integrated Project

During 2008 we re-commenced pursuing active commercial transactions involving installation of our 2G Tech for

CAFO waste treatment and related environmental remediation and initiation of pre-development modeling and pre-development work

to prepare for our initial Integrated Projects.

We are now focused JVs based on implementation of our 3G Tech platform (and business

model) as discussed above.

Our original systems were wastewater treatment

systems for dairy farms and food processing plants.

The basic design was modified in late 1994 to create Nutrient Management

Systems ("NMS") that produced organic soil 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, in the aggregate, approximately

30 of these first iteration of Bion’s systems in 7 states, of which we believe a few may still in operation in 3 states.

We discontinued marketing of our first-generation NMS systems during fiscal year 2002 and turned control and ownership of the first-generation

systems over to the farms on which they were installed over the following two years.

We were unable to produce a business

model based on the first-generation systems that would generate sufficient revenues to create a profitable business.

continuing to market and operate the first-generation systems, during the second half of calendar year 2000, we began to focus

our activities on developing the next generation of the Bion technology.

We no longer operate or own any of the first-generation

As a result of our research and development

efforts, the core of our current technology was re-developed during fiscal years 2001-2004.

We designed and tested Systems

that used state-of-the-art, computerized, real-time monitoring and system control with the potential to be remotely accessed for

both reporting requirements and control functions.

From 2003 through early 2008, we

primarily worked on technology improvements and applications and in furtherance of our business model of Integrated Project development.

During 2008 we re-commenced pursuing active commercial transactions involving installation of our 2G Tech for CAFO waste treatment and

related environmental remediation and initiation of pre-development modeling and pre-development work to prepare for our initial Integrated

We are now focused primarily on development of JVs based on implementation of our 3G Tech platform (and business model) in the

industry segments discussed above.

Our original systems were wastewater treatment systems

for dairy farms and food processing plants.

The basic design was modified in late 1994 to create Nutrient Management Systems ("NMS")

that produced organic soil 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, in the aggregate, approximately 30 of these first iteration of Bion’s systems

in 7 states, of which we believe a few may still in operation in 3 states.

We discontinued marketing of our first-generation NMS

systems during fiscal year 2002 and turned control and ownership of the first-generation systems over to the farms on which they were

installed over the following two years.

We were unable to produce a business model based on the first-generation systems that would

generate sufficient revenues to create a profitable business.

While continuing to market and operate the first-generation systems,

during the second half of calendar year 2000, we began to focus our activities on developing the next generation of the Bion technology.

We no longer operate or own any of the first-generation NMS systems.

As a result of our research and development efforts,

the core of our current technology was re-developed during fiscal years 2001-2004.

We designed and tested Systems that used state-of-the-art,

computerized, real-time monitoring and system control with the potential to be remotely accessed for both reporting requirements and control

These Systems were smaller and faster than our first-generation NMS systems.

The initial versions of our second generation of Bion Systems were designed to harvest solids used to produce organic fertilizer

and soil amendments or additives (the "BionSoil(R) products") in a few weeks as compared to six to twelve months with

our first-generation systems.

During 2003-4 we designed, installed and began

testing a commercial scale, second generation Bion System as a temporary modification or retrofit to a waste lagoon on a 1,250-milking

cow dairy farm in Texas, known as the DeVries Dairy.

In December 2004, Bion published an independently peer-reviewed report,

a copy of which may be found on our website, www.biontech.com , with data from the DeVries

project demonstrating a reduction in nutrients (nitrogen and phosphorus) of approximately 75% and air emissions of approximately

More specifically, those published results indicated that the Bion System produced a 74% reduction of nitrogen and a

79% reduction of phosphorus.

The air results show that the Bion System limited emissions from the waste stream as follows:

The initial versions of our second

generation of Bion Systems were designed to harvest solids used to produce organic fertilizer and soil amendments or additives (the "BionSoil(R)

products") in a few weeks as compared to six to twelve months with our first-generation systems.

During 2003-4 we designed, installed and began testing

a commercial scale, second generation Bion System as a temporary modification or retrofit to a waste lagoon on a 1,250-milking cow dairy

farm in Texas, known as the DeVries Dairy.

In December 2004, Bion published an independently peer-reviewed report, a copy of which

may be found on our website, www.biontech.com , with data from the DeVries project demonstrating

a reduction in nutrients (nitrogen and phosphorus) of approximately 75% and air emissions of approximately 95%.

More specifically,

those published results indicated that the Bion System produced a 74% reduction of nitrogen and a 79% reduction of phosphorus.

air results show that the Bion System limited emissions from the waste stream as follows:

(in pounds per 1,400-pound dairy cow per year):

2 unchanged sentences

Nitrogen Oxides

These emissions represented a reduction from

published baselines of 95%-99%.

Through 2007 the demonstration project at the

DeVries Dairy in Texas also provided Bion with the opportunity to explore mechanisms to best separate the processed manure into

streams of coarse and fine solids, with the coarse cellulosic solids/biomass supporting generation of renewable energy and the

fine solids potentially becoming the basis of organic fertilizer products and/or a high-protein animal feed ingredients.

research was also carried out on various aspects of nutrient releases and atmospheric emissions.

Bion discontinued operation of the DeVries

demonstration research system during 2008.

During the 2005-2008 period, Bion focused on

completing development of its 2G Tech platform and business model.

As such, we did not pursue near term sales and revenue

opportunities, such as retrofitting existing CAFO's with interim versions of our waste management solutions, because such efforts

would have diverted scarce management and financial resources and negatively impacted our ability to complete development of an

integrated technology platform in support of large-scale sustainable Projects.

From 2009 through the present period, Bion

has actively pursued business opportunities in three broad areas 1) Bion systems to retrofit of existing CAFO’s (some

of which may generate verified nutrient credits and revenues from the production of renewable energy and byproducts) (“Retrofits”),

and 2) development of new state-of-the-art large scale waste treatment facilities, potentially in conjunction with new CAFOs developed

in strategic locations that were not previously possible due to environmental constraints in strategic locations (“Projects”)

(some of these may be “closed loop’

Integrated Projects that were not previously possible due to environmental constraints

as described below), and 3) licensing and/or joint venturing of Bion’s technology (primarily) outside North America.

is pursuing these opportunities within the United States and internationally.

Launch of our 3G Tech (for use in all these areas)

is anticipated during2020/2021.

We believe significant Retrofit opportunities

exist that will enable us to generate future revenue streams from Bion's 2G and 3G Tech.

The initial Retrofit opportunities we

are pursuing have related to the existing clean-up program for the Chesapeake Bay ('Chesapeake Bay Program' or 'CB Program').

Company has at times deployed some of its limited resources toward an initiative in the Great Lakes/North Central states that has

not yet yielded any contracts.

The Company anticipates that further opportunities for our remediation/retrofit business will develop

in other areas with CAFO’s, including the watersheds of the Great Lakes (from New York to Minnesota), the extended Mississippi

River/Gulf of Mexico watershed (including its tributaries from Pennsylvania in the east to Montana/Wyoming/Colorado in the west),

and other areas with excess nutrient pollution from agriculture in general and CAFO’s in particular.

Over the past 36 months the Company has undertaken

research and development efforts to develop the 3G Tech (and related applications) with emphasis on increasing efficiency and increasing

recovery of high value by-products (organic and inorganic), which efforts continue during the current fiscal year.

These emissions represented a reduction from published

baselines of 95%-99%.

Through 2007 the demonstration project at the DeVries

Dairy in Texas also provided Bion with the opportunity to explore mechanisms to best separate the processed manure into streams of coarse

and fine solids, with the coarse cellulosic solids/biomass supporting generation of renewable energy and the fine solids potentially becoming

the basis of organic fertilizer products and/or a high-protein animal feed ingredients.

On-going research was also carried out on various

aspects of nutrient releases and atmospheric emissions.

Bion discontinued operation of the DeVries demonstration

research system during 2008.

During the 2005-2008 period, Bion focused on completing

development of its 2G Tech platform and business model.

As such, we did not pursue near term sales and revenue opportunities, such

as retrofitting existing CAFO's with interim versions of our waste management solutions, because such efforts would have diverted scarce

management and financial resources and negatively impacted our ability to complete development of an integrated technology platform in

support of large-scale sustainable Projects.

From 2009 through 2015 (when development of our 3G

Tech platform began), Bion actively pursued business opportunities in three broad areas 1) Bion systems to retrofit of existing

CAFO’s (some of which may generate verified nutrient credits and revenues from the production of renewable energy and byproducts)

(“Retrofits”), and 2) development of new state-of-the-art large scale waste treatment facilities, potentially in conjunction

with new CAFOs developed in strategic locations that were not previously possible due to environmental constraints in strategic locations

(“Projects”) (some of these may be “closed loop’

Integrated Projects that were not previously possible due to

environmental constraints as described below), and 3) licensing and/or joint venturing of Bion’s technology (primarily) outside

North America.

Bion is now primarily pursuing JVs related to these opportunities within the United States and internationally based on

our 3G Tech as described above.

Chesapeake Bay Watershed:

Kreider Farms

Projects/Pennsylvania Initiatives

The urgency and priority of the need to clean

up nutrient (primarily nitrogen and phosphorus) pollution to the Chesapeake Bay was clearly demonstrated with promulgation of President

Obama's 2009 Executive Order concerning clean-up of the Chesapeake Bay and the EPA’s publication and issuance during December

2010 of the Chesapeake Bay Total Maximum Daily Load (TMDL) standard (http://www.epa.gov/reg3wapd/tmdl/ChesapeakeBay/tmdlexec.html )

Farms Projects/Pennsylvania Initiatives

The urgency and priority of the need to clean up nutrient

(primarily nitrogen and phosphorus) pollution to the Chesapeake Bay was clearly demonstrated with promulgation of President Obama's 2009

Executive Order concerning clean-up of the Chesapeake Bay and the EPA’s publication and issuance during December 2010 of the Chesapeake

Bay Total Maximum Daily Load (TMDL) standard (http://www.epa.gov/reg3wapd/tmdl/ChesapeakeBay/tmdlexec.html )

for nutrient pollution in Chesapeake Bay tributaries.

In May 2010, the EPA published their overall strategy for remediating the

Chesapeake Bay, and they have committed to reducing nitrogen and phosphorus flows to the Bay sufficiently to enable 60% of the

Bay watershed segments to meet water quality standards by 2025.

At that time, 89 of the 92 Bay and tidal watershed segments

were not in compliance with water quality standards (97% were out of compliance).

The EPA and associated state agencies also

committed to short-term 3-year compliance milestones to enhance accountability and corrective actions, along with a host of definable

and measurable goals, enhanced partnerships, and major environmental initiatives.

Based on these actions, greater compliance

has been required commencing with the 2016 ‘water year’.

EPA documents defined the overall mission as requiring

an approximately 65-million-pound annual reduction from existing nitrogen (N) loading to the Chesapeake Bay by 2025, of which 35

million pounds was allocated to Pennsylvania.

Importantly, the 3-year compliance milestones were established as a part of the compliance

program to add both short- and long-term accountability to state actions associated with reduced nutrient and sediment flows to

the Chesapeake Bay.

According to the EPA’s Interim Evaluation of Pennsylvania’s Milestone Progress published in June

2015, PA was 14.6 million pounds behind its 2014-2015 milestone commitments for nitrogen, a remarkably large deficit given the

previously stated 2-million-pound deficit from the 2012-2013 water year.

EPA has placed PA’s agriculture and urban/suburban

sectors under a “Backstop Actions Level”, the highest level of EPA oversight.

EPA has also stated that if load

reductions remain off track, EPA may consider seeking additional (and expensive) pollutant reductions from the wastewater sector.

In an effort to get back on track and hold

off federal intervention, PA unveiled a purported “comprehensive strategy”

In May 2010, the EPA published their overall strategy for remediating the Chesapeake

Bay, and they have committed to reducing nitrogen and phosphorus flows to the Bay sufficiently to enable 60% of the Bay watershed segments

to meet water quality standards by 2025.

At that time, 89 of the 92 Bay and tidal watershed segments were not in compliance with

water quality standards (97% were out of compliance).

The EPA and associated state agencies also committed to short-term 3-year

compliance milestones to enhance accountability and corrective actions, along with a host of definable and measurable goals, enhanced

partnerships, and major environmental initiatives.

Based on these actions, greater compliance has been required commencing with

the 2016 ‘water year’.

EPA documents defined the overall mission as requiring an approximately 65-million-pound annual

reduction from existing nitrogen (N) loading to the Chesapeake Bay by 2025, of which 35 million pounds was allocated to Pennsylvania.

Importantly, the 3-year compliance milestones were established as a part of the compliance program to add both short- and long-term accountability

to state actions associated with reduced nutrient and sediment flows to the Chesapeake Bay.

According to the EPA’s Interim Evaluation

of Pennsylvania’s Milestone Progress published in June 2015, PA was 14.6 million pounds behind its 2014-2015 milestone commitments

for nitrogen, a remarkably large deficit given the previously stated 2-million-pound deficit from the 2012-2013 water year.

has placed PA’s agriculture and urban/suburban sectors under a “Backstop Actions Level”, the highest level of EPA oversight.

EPA has also stated that if load reductions remain off track, EPA may consider seeking additional (and expensive) pollutant reductions

from the wastewater sector.

In an effort to get back on track and hold off federal

intervention, PA unveiled a purported “comprehensive strategy”

to "reboot"

the state's efforts to improve water quality in January 2016.

The reboot strategy relied upon a mix

of enhanced farm compliance and enforcement activities along with the promotion of additional best management practices (BMP).

This proposed strategy has been met with skepticism about its efficacy/practicality and resistance within the agricultural community.

While many of these reboot efforts are continuing today, the PADEP Secretary resigned in May 2016 and PA appears to have slowed

implementation efforts recently while seeking alternative approaches to reduce PA’s nitrogen pollution to the Chesapeake

The budget spending package that was passed by the PA legislature in July 2018 contained no new funding for clean water related

to either the Chesapeake Bay compliance mandates or state water quality.

As a result of PA’s default of its Bay

mandates, and the host of upcoming both short and long-term specific commitments and compliance deadlines, Bion believes that its

long-term opportunity related to the Chesapeake Bay clean-up has potentially been significantly expanded and accelerated.

During 2008, Bion executed an agreement to

install a Bion System at the Kreider Farms (“KF”) in Lancaster County, Pennsylvania to reduce nitrogen (including ammonia

emissions which are re-deposited as nitrogen from the atmosphere) and phosphorus in the farm's effluent.

Bion undertook this project

due, in large part, to Pennsylvania's nutrient credit trading program, which was established to provide cost-effective reductions

of the excess flow of nutrients (nitrogen and phosphorus) into the Chesapeake Bay watershed.

Bion worked extensively with the Pennsylvania

Department of Environmental Protection ('PADEP') over several years to establish nutrient credit calculation/ verification methodologies

that were appropriate to Bion's 2G Tech and recognizes its 'multi-media' (both water and atmospheric) approach to nutrient reductions.

Pennsylvania's nutrient credit trading program allows for voluntary credit trading between a 'non-point source' (such as a dairy

or other agricultural sources) and a 'point source' polluter, such as a municipal waste water treatment plant or a housing development.

For example, pursuant to this program, since Bion can reduce the nutrients from an existing dairy much more cost-effectively than

a municipal wastewater treatment plant can reduce nutrients to meet its baseline, a municipal facility can purchase nutrient reduction

credits (‘Credits’) from Bion to offset its nutrient discharges, rather than spending significantly more money to make

(and operate) the plant upgrades necessary to achieve its own reductions.

However, the market for long term Credits in PA has

failed to develop any significant breadth or depth and no Credits have been sold from the Kreider 1 system.

During May 2008, the PADEP approved Bion's

initial protocols to determine how many tradable nutrient (nitrogen and phosphorus) credits Bion would receive for nutrient reductions

achieved through installation of its comprehensive dairy waste management 2G Tech Kreider 1 project pursuant to PA's efforts under

the Chesapeake Bay Program mandates.

The reboot strategy relied upon a mix of enhanced farm compliance

and enforcement activities along with the promotion of additional best management practices (BMP).

This proposed strategy has been

met with skepticism about its efficacy/practicality and resistance within the agricultural community.

While many of these reboot efforts

are continuing today, the PADEP Secretary resigned in May 2016 and PA appears to have slowed implementation efforts recently while seeking

alternative approaches to reduce PA’s nitrogen pollution to the Chesapeake Bay.

The budget spending package that was passed by the

PA legislature in July 2018 contained no new funding for clean water related to either the Chesapeake Bay compliance mandates or state

water quality.

As a result of PA’s default of its Bay mandates,

and the host of upcoming both short and long-term specific commitments and compliance deadlines, Bion believes that its long-term opportunity

related to the Chesapeake Bay clean-up has potentially been significantly expanded and accelerated.

During 2008, Bion executed an agreement to install

a Bion System at the Kreider Farms (“KF”) in Lancaster County, Pennsylvania to reduce nitrogen (including ammonia emissions

which are re-deposited as nitrogen from the atmosphere) and phosphorus in the farm's effluent.

Bion undertook this project due, in large

part, to Pennsylvania's nutrient credit trading program, which was established to provide cost-effective reductions of the excess flow

of nutrients (nitrogen and phosphorus) into the Chesapeake Bay watershed.

Bion worked extensively with the Pennsylvania Department of

Environmental Protection ('PADEP') over several years to establish nutrient credit calculation/ verification methodologies that were appropriate

to Bion's 2G Tech and recognizes its 'multi-media' (both water and atmospheric) approach to nutrient reductions.

Pennsylvania's

nutrient credit trading program allows for voluntary credit trading between a 'non-point source' (such as a dairy or other agricultural

sources) and a 'point source' polluter, such as a municipal waste water treatment plant or a housing development.

For example, pursuant

to this program, since Bion can reduce the nutrients from an existing dairy much more cost-effectively than a municipal wastewater treatment

plant can reduce nutrients to meet its baseline, a municipal facility can purchase nutrient reduction credits (‘Credits’)

from Bion to offset its nutrient discharges, rather than spending significantly more money to make (and operate) the plant upgrades necessary

to achieve its own reductions.

However, the market for long term Credits in PA has failed to develop any significant breadth or depth

and no Credits have been sold from the Kreider 1 system.

During May 2008, the PADEP approved Bion's initial

protocols to determine how many tradable nutrient (nitrogen and phosphorus) credits Bion would receive for nutrient reductions achieved

through installation of its comprehensive dairy waste management 2G Tech Kreider 1 project pursuant to PA's efforts under the Chesapeake

Bay Program mandates.

During April 2010, the PADEP issued an amended certification.

The PADEP's approval includes

the certification of credits, both for ammonia air emission reductions, and for significantly reducing the leaching and runoff

potential of land-applied nutrients.

The PADEP has certified the Kreider 1 dairy system for 107 nitrogen and 13 phosphorus credits

(each credit represents an annual pound of reduction) for each of the 1,200 dairy cows (subject to testing and verification based

on operational data).

Bion's agreements with Kreider Farms provide for the Kreider 1 System to expand through-put to treat the

waste from the Kreider dairy support herd after the PADEP has verified the operating results.

It is anticipated that this expansion

will take place and lead to a proportionate increase in credits generated for sale, only if a more robust market for long term

nutrient reductions develops.

The PADEP's approval includes the certification

of credits, both for ammonia air emission reductions, and for significantly reducing the leaching and runoff potential of land-applied

The PADEP has certified the Kreider 1 dairy system for 107 nitrogen and 13 phosphorus credits (each credit represents an annual

pound of reduction) for each of the 1,200 dairy cows (subject to testing and verification based on operational data).

Bion's agreements

with Kreider Farms provide for the Kreider 1 System to expand through-put to treat the waste from the Kreider dairy support herd after

the PADEP has verified the operating results.

It is anticipated that this expansion will take place and lead to a proportionate increase

in credits generated for sale, only if a more robust market for long term nutrient reductions develops.

The economics (potential revenues, profitability

and continued operation) of the Kreider 1 System were based almost entirely on the long-term sale of nutrient (nitrogen and/or

phosphorus) reduction credits to meet the requirements of the Chesapeake Bay environmental clean-up.

and continued operation) of the Kreider 1 System were based almost entirely on the long-term sale of nutrient (nitrogen and/or phosphorus)

reduction credits to meet the requirements of the Chesapeake Bay environmental clean-up.

See below for further discussion.

Pursuant to the KF agreements, Kreider 1 system

to treat KF's dairy waste streams to reduce nutrient releases to the environment, while generating marketable nutrient credits

and renewable energy, was designed, constructed and entered full-scale operation during 2011.

On January 26, 2009, the Board

of the Pennsylvania Infrastructure Investment Authority (“Pennvest”) approved a $7.75 million loan to Bion PA 1, LLC

(“PA1”), a wholly-owned subsidiary of the Company, for the initial Kreider Farms project (“Kreider 1”).

After substantial unanticipated delays, on August 12, 2010, PA1 received a permit for construction of the Kreider 1 system.

Pursuant to the KF agreements, Kreider 1 system to

treat KF's dairy waste streams to reduce nutrient releases to the environment, while generating marketable nutrient credits and renewable

energy, was designed, constructed and entered full-scale operation during 2011.

On January 26, 2009, the Board of the Pennsylvania

Infrastructure Investment Authority (“Pennvest”) approved a $7.75 million loan to Bion PA 1, LLC (“PA1”), a wholly-owned

subsidiary of the Company, for the initial Kreider Farms project (“Kreider 1”).

After substantial unanticipated delays,

on August 12, 2010, PA1 received a permit for construction of the Kreider 1 system.

Construction activities commenced during November

The closing/settlement of the Pennvest Loan took place on November 3, 2010.

PA1 finished the construction of the Kreider 1 System and entered a period of system ‘operational shakedown’

PA1 finished the construction of the Kreider

1 System and entered a period of system ‘operational shakedown’

during May 2011.

The Kreider 1 System reached full, stabilized operation by the end of the 2012 fiscal year.

2011, the PADEP re-certified the nutrient credits for this project.

The PADEP issued final permits for the Kreider 1 System

(including the credit verification plan) on August 1, 2012, on which date the Company deemed that the Kreider System was ‘placed

in service’.

As a result, PA1 commenced generating nutrient reduction credits for potential sale, while continuing

to utilize the Kreider 1 system to test technology improvements and add-ons.

However, substantial liquidity in the Pennsylvania

nutrient credit market for long term nutrient reduction credits has never developed significant breadth and depth, which limited

liquidity/depth has negatively impacted Bion's business plans and has made it impossible to economically monetize the nutrient

reductions created by PA1's Kreider 1 project (and Bion's other proposed projects in PA).

These difficulties have prevented PA1

from generating any material revenues from the Kreider 1 project to date and it is unlikely that PA1 will ever be able to generate

such revenues from the Kreider 1 system (as designed and constructed).

The Kreider 1 System reached full,

stabilized operation by the end of the 2012 fiscal year.

During 2011, the PADEP re-certified the nutrient credits for this project.

The PADEP issued final permits for the Kreider 1 System (including the credit verification plan) on August 1, 2012, on which date the

Company deemed that the Kreider System was ‘placed in service’.

As a result, PA1 commenced generating nutrient reduction

credits for potential sale, while continuing to utilize the Kreider 1 system to test technology improvements and add-ons.

substantial liquidity in the Pennsylvania nutrient credit market for long term nutrient reduction credits has never developed significant

breadth and depth, which limited liquidity/depth has negatively impacted Bion's business plans and has made it impossible to economically

monetize the nutrient reductions created by PA1's Kreider 1 project (and Bion's other proposed projects in PA).

These difficulties have

prevented PA1 from generating any material revenues from the Kreider 1 project to date and it is unlikely that PA1 will ever be able to

generate such revenues from the Kreider 1 system (as designed and constructed).

PA1 had sporadic discussions/negotiations with Pennvest

related to forbearance and/or re-structuring its obligations pursuant to the Pennvest Loan for more than three years.

In the context

of such discussions/negotiations, PA1 elected not to make interest payments to Pennvest on the Pennvest Loan since January 2013.

Additionally, PA1 has not made any principal payments, which were to begin in fiscal 2013, and, therefore, the Company has classified

the Pennvest Loan as a current liability as of June 30, 2020.

Due to the failure of the PA nutrient reduction credit market

to develop, the Company determined that the carrying amount of the property and equipment related to the Kreider 1 project exceeded

its estimated future undiscounted cash flows based on certain assumptions regarding timing, level and probability of revenues from

sales of nutrient reduction credits and, therefore, PA1 and the Company recorded impairments related to the value of the Kreider

1 assets of $1,750,000 and $2,000,000 at June 30, 2015 and June 30, 2014, respectively.

During the 2016 fiscal year, effective

June 30, 2016, PA1 and the Company recorded an impairment of $1,684,562 to the value of the Kreider 1 assets which reduced the

value on the Company’s books to zero.

This impairment reflects management’s judgment that the salvage value of

the Kreider 1 assets roughly equaled PA1’s contractual obligations related to the Kreider 1 system, including expenses

related to decommissioning of the Kreider 1 system , costs associated with needed capital upgrade expenses, and re-certification/

permitting amendments.

On September 25, 2014, Pennvest exercised

its right to declare the Pennvest Loan in default and accelerated the Pennvest Loan and demanded that PA1 pay $8,137,117 (principal,

interest plus late charges) on or before October 24, 2014.

PA1 did not make the payment and does not have the resources to make

the payments demanded by Pennvest.

PA1 commenced discussions and negotiations with Pennvest concerning this matter but Pennvest

rejected PA1's proposal made during the fall of 2014.

As of the date of this report, no proposals (formal or informal) are under

consideration and only sporadic communication has taken place regarding the matters involved over the last 6+ years.

possible at this date to predict the outcome of this matter given the extended period which has passed without resolution and that

fact that the technology employed in the Kreider 1 system is now outdated.

However, the Company believes that a loan modification

agreement (coupled with an agreement regarding an update and restart of full operations of KF1) may in the future be possible in

conjunction with the Kreider 2 Project described below) may be reached in the future if/when a more robust market for nutrient

reductions develops in PA, of which there is no assurance.

The Covid-19 pandemic has further increased uncertainties.

will continue to evaluate various options with regard to Kreider 1 over the next 6-12 months.

The projected economics (potential

related to forbearance and/or re-structuring its obligations pursuant to the Pennvest Loan for more than seven years.

In the context of

such discussions/negotiations, PA1 elected not to make interest payments to Pennvest on the Pennvest Loan since January 2013.

Additionally,

PA1 has not made any principal payments, which were to begin in fiscal 2013, and, therefore, the Company has classified the Pennvest Loan

as a current liability as of June 30, 2021.

Due to the failure of the PA nutrient reduction credit market to develop, the Company

determined that the carrying amount of the property and equipment related to the Kreider 1 project exceeded its estimated future undiscounted

cash flows based on certain assumptions regarding timing, level and probability of revenues from sales of nutrient reduction credits and,

therefore, PA1 and the Company recorded impairments related to the value of the Kreider 1 assets of $1,750,000 and $2,000,000 at June

30, 2015 and June 30, 2014, respectively.

During the 2016 fiscal year, effective June 30, 2016, PA1 and the Company recorded an

impairment of $1,684,562 to the value of the Kreider 1 assets which reduced the value on the Company’s books to zero.

impairment reflects management’s judgment that the salvage value of the Kreider 1 assets roughly equaled PA1’s contractual

obligations related to the Kreider 1 system, including expenses related to the decommissioning of the Kreider 1 system.

On September 25, 2014, Pennvest exercised its right

to declare the Pennvest Loan in default and accelerated the Pennvest Loan and demanded that PA1 pay $8,137,117 (principal, interest plus

late charges) on or before October 24, 2014.

PA1 did not make the payment and does not have the resources to make the payments demanded

PA1 commenced discussions and negotiations with Pennvest concerning this matter but Pennvest rejected PA1’s proposal

made during the fall of 2014.

PA1 made a new proposal to Pennvest during September 2021 which proposal is presently under consideration

PA1 provides Pennvest with its financial statements (which include a description of system status) annually.

During the 2021

fiscal year, Pennvest’s auditors requested a ‘corrective action plan’

and PA1 informed Pennvest that “…

there is no viable corrective action plan for the Pennvest Loan (‘Loan’).

The facility funded by the Loan has been shut down

for many years (which has been disclosed in the annual financial reports to Pennvest and in public filings by the parent of Bion PA 1,

LLC) and the technology utilized in the facility is now obsolete.

The facility has not been commercially operated for approximately six

years and has generated zero income.

We recommend that Pennvest take appropriate steps to remove and sell the equipment.”

responded favorably to the approach of selling the equipment but no actions have yet taken place.

PA1 and the Company are currently discussing

proposals with Pennvest seeking full resolution of these matters.

The Company anticipates additional communication with Pennvest on this

matter and the recent proposal during the current year.

It is not possible at this date to predict the final outcome of this matter, but

the Company believes it is likely that that the equipment will be sold with the proceeds delivered to Pennvest during our current fiscal

year as part of a resolution.

However , the resolution of these matters including the manner and means of such equipment sale has

not been agreed upon as of this date.

PA1 will evaluate the appropriate manner to resolve/wrap-up its business over the balance of the

current fiscal year.

Note that the projected economics (potential

revenues, profitability and continued operation) of the Kreider 1 System were based almost entirely on the long-term sale of nutrient

(nitrogen and/or phosphorus) reduction credits to meet the requirements of the Chesapeake Bay environmental clean-up.

for further discussion.

During August 2012, the Company provided

Pennvest (and the PADEP) with data demonstrating that the Kreider 1 system met the 'technology guaranty' standards which were incorporated

in the Pennvest financing documents and, as a result, the Pennvest Loan is now solely an obligation of PA1.

However, the Company’s

consolidated balance sheet as of June 30, 2020 reflects the Pennvest Loan as a liability of $9,585,883 despite the fact that the

obligation (if any) solely an obligation of PA 1.

The Company is currently not operating

the Kreider 1 System but continues to ensure that some equipment maintenance work takes place pending development of a more robust

market for its nutrient reductions and/or its potential inclusion within the Kreider 2 Project as discussed above.

As a result of the extended period of Kreider

1 full-scale, commercial operations, Bion is confident that future Bion systems can be constructed with even higher operational

efficiencies at lower capital expense and with lower operational costs.

Operating results of the Kreider 1 system have documented

the efficacy of Bion’s nutrient reduction technology and vetted potential ‘add-ons’

for future installations.

The original Kreider agreements provided for

Bion to develop a waste treatment/renewable energy production facility to treat the waste from Kreider's approximately 6+ million

chickens (planned to expand to approximately 9-10 million)(and potentially other poultry operations and/or other waste streams)('Kreider

Renewable Energy Facility' or ' Kreider 2 Project').

On May 5, 2016, the Company executed a stand-alone joint venture agreement

with Kreider Farms covering all matters related to development and operation of a system to treat the waste streams from Kreider's

poultry facilities in Bion PA2 LLC ("PA2").

The Company continues its development work related to the details of the

Kreider 2 Project.

During May 2011 the PADEP certified Kreider 2 2G Tech Project design for 559,457 nutrient credits under the

old EPA's Chesapeake Bay model.

The Company anticipates that the 3G Tech Kreider 2 Project will be re-certified for between 2-4

million (or more) nutrient reduction credits (for treatment of the waste stream from Kreider's poultry) pursuant to a future reapplication

(or subsequent amended application) pursuant to the amended EPA Chesapeake Bay model and 2018 agreements between the EPA and PA.

Note that this Project may be expanded in the future to treat wastes from other local and regional CAFOs (poultry and/or dairy

including the Kreider Dairy) and/or Kreider poultry expansion (some of which may not qualify for nutrient reduction credits).

The review process to clarify certain issues related to credit calculation and verification commenced during 2014 based on Bion’s

2G Tech but has been largely placed on hold while certain matters are resolved between the EPA and PA and pending development of

a robust market for nutrient reductions in PA.

The Company anticipates it will submit an amended application based on our 3G Technology

once these matters are clear.

Site specific design and engineering work for this facility, which may be one of the first full-scale

projects to utilize Bion's 3G Tech, have not commenced, and the Company does not yet have financing in place for the Kreider 2

This opportunity is being pursued through PA2.

If there are positive developments related to the market for nutrient reductions

in PA, of which there is no assurance, the Company intends to pursue development, design and construction of the Kreider 2 Project

with a goal of achieving operational status of its initial modules during the 2021 calendar year, and hopes to enter into agreements

related to sales of the nutrient reduction credits for future delivery (under long term contracts) during the 2021 fiscal year

subject to verification by the PADEP based on operating data from the Kreider 2 Project.

The economics (potential revenues and

profitability) of the Kreider 2 Project, despite its use of Bion's 3G Tech for increased recovery of marketable by-products, are

based in material part the long-term sale of nutrient (nitrogen and/or phosphorus) reduction credits to meet the requirements of

the Chesapeake Bay environmental clean-up.

See below for further

During August 2012, the Company provided Pennvest

(and the PADEP) with data demonstrating that the Kreider 1 system met the 'technology guaranty' standards which were incorporated in the

Pennvest financing documents and, as a result, the Pennvest Loan is now solely an obligation of PA1.

However, the Company’s consolidated

balance sheet as of June 30, 2020 reflects the Pennvest Loan as a liability of $9,585,883 despite the fact that the obligation (if any)

solely an obligation of PA 1.

The Company is currently not operating the Kreider

1 System but continues to ensure that some equipment maintenance work takes place pending development of a more robust market for its

nutrient reductions and/or its potential inclusion within the Kreider 2 Project as discussed above.

The original Kreider agreements provided for Bion

to develop a waste treatment/renewable energy production facility to treat the waste from Kreider's approximately 6+ million chickens

(planned to expand to approximately 9-10 million)(and potentially other poultry operations and/or other waste streams)('Kreider Renewable

Energy Facility' or ' Kreider 2 Project').

On May 5, 2016, the Company executed a stand-alone joint venture agreement with Kreider Farms

covering all matters related to development and operation of a system to treat the waste streams from Kreider's poultry facilities in

Bion PA2 LLC ("PA2").

The Company continues its development work related to the details of the Kreider 2 Project.

2011 the PADEP certified Kreider 2 2G Tech Project design for 559,457 nutrient credits under the old EPA's Chesapeake Bay model.

anticipates that the 3G Tech Kreider 2 Project will be re-certified for between 2-4 million (or more) nutrient reduction credits (for

treatment of the waste stream from Kreider's poultry) pursuant to a future reapplication (or subsequent amended application) pursuant

to the amended EPA Chesapeake Bay model and 2018 agreements between the EPA and PA.

Note that this Project may be expanded in the future

to treat wastes from other local and regional CAFOs (poultry and/or dairy –

including the Kreider Dairy) and/or Kreider poultry

expansion (some of which may not qualify for nutrient reduction credits).

The review process to clarify certain issues related to credit

calculation and verification commenced during 2014 based on Bion’s 2G Tech but has been placed on hold pending development of a

robust market for nutrient reductions in PA.

The Company anticipates it will submit an amended application based on our 3G Tech once these

matters are clear.

Site specific design and engineering work for this facility, which may be one of the first full-scale projects to utilize

Bion's 3G Tech, have not commenced, and the Company does not yet have financing in place for the Kreider 2 Project.

This opportunity is

being pursued through PA2.

If there are positive developments related to the market for nutrient reductions in PA, of which there is no

assurance, the Company intends to re-commence development, design and construction of the Kreider 2 Project thereafter.

The economics

(potential revenues and profitability) of the Kreider 2 Project, despite its use of Bion's 3G Tech for increased recovery of marketable

by-products, are based in material part the long-term sale of nutrient (nitrogen and/or phosphorus) reduction credits to meet the requirements

of the Chesapeake Bay environmental clean-up.

However, liquidity in the PA nutrient credit market has not developed significant breadth

and depth, which lack of liquidity has negatively impacted Bion's business plans and will most likely continue delay PA2's Kreider

2 Project and other proposed projects in PA.

Note that Bion believes that the Kreider

2 Project and/or subsequent Bion Projects will eventually generate revenue from the sale of:

a) nutrient reductions (credits or

in other form), b) renewable energy (and related credits), c) sales of fertilizer products, and/or d) potentially, in time, credits

for the reduction of greenhouse gas emissions, plus e) license fees related to a ‘sustainable brand’.

We believe that

the potential market is very large, but it is not possible to predict the exact timing and/or magnitude of these potential markets

at this time.

The Kreider 2 poultry waste treatment

facility in PA may be the Company’s initial Project utilizing our 3G Technology.

Bion anticipates that it will select a site

for the Kreider 2 Project and/or its initial Integrated Project (and possibly additional Projects) during the current fiscal year

if SB575 (or a successor) becomes law in PA (including funding).

Bion hopes to commence development of this Project by optioning

land and beginning the site specific design and permitting process during the current year, but delays are possible.

possible at this time to firmly predict where this Project will be developed or the order in which Projects will be developed.

All potential Projects are in very early pre-development stages and may never progress to actual development or may be developed

after other Projects not yet under active consideration.

Several independent studies have calculated

the average cost to remove nitrogen through various sector practices.

Reports prepared for the PA Senate (2008), Chesapeake Bay

Commission (2012) and PA legislature (2013;

described below and updated during 2018), as well as the Maryland Chesapeake Bay Financing

Strategy Report (2015), demonstrate that the cost to remove nitrogen (per pound on average) from agriculture is $44 to $54, municipal

$28 to $43, and storm water:

$386 to $633.

Pursuant to the PA legislative study, by replacing sector allocation (for

all sectors) with competitive bidding, up to 80 percent savings could be achieved in PA’s Chesapeake Bay compliance costs

($1.5 billion annually) by 2025.

If the legislative study had focused on the cost differentials of competitive bidding compared

only with storm water, the savings would be substantially greater.

Since these studies were completed, most of

the larger (Tier 1) municipal wastewater treatment plants in PA have been upgraded, at a cost of approximately $2.5 billion (vs

initial 2004 PA DEP cost estimates of $376 million).

US EPA is now focused on PA’s storm water allocation (3.5 million pounds)

and has this sector on ‘backstop level actions’, the highest level of EPA-oversight and the final step before sanctions.

In the same 2004 PA DEP cost estimate that led to the more than a $2 billion underestimate/miscalculation in municipal wastewater

plant upgrade costs, the estimate for storm water cost was $5.6 billion.

In April 2017, US EPA sent a Letter of Expectation to

PA DEP, expressing the agency’s support for the use of nutrient credit trading and competitive bidding to engage the private-sector

to lower costs.

The letter specifically encouraged the use of credit trading to offset the state’s looming storm water obligations.

Bion anticipates that it will be able to

profitably sell nutrient credits from its Kreider facilities (and subsequent projects) if prices are in the range of $8-$12

(or higher) per lb.

of nitrogen reduction, of which there is no assurance.

Bion further believes that with the studies and

information now available to other states that are (or will shortly be) facing these same decisions, a cost-benefit analysis will

make it clear from the outset that credits from alternatives can provide dramatically lower-cost solutions than traditional strategies.

On January 22, 2013, the Pennsylvania Legislative

Budget and Finance Committee (“LBFC”) published a study (“Report”) detailing the economic and environmental

benefits that would result from the implementation of a competitively bid, request for proposal (“RFP”) program for

nitrogen reductions to fulfill Pennsylvania’s obligations under the US EPA-mandated Chesapeake Bay Total Maximum Daily Load

We agree with and support the basic conclusions and recommendations of the Report.

Links to both the full Report and

a summary are available on the policy page of Bion’s website at www.biontech.com/policy .

The Report demonstrates

that implementation of such a RFP program would result in dramatically lower cost compliance with Pennsylvania’s requirements

under the CB TMDL and would also provide a host of additional environmental and economic benefits to Pennsylvania’s interior

freshwater resources and communities.

The Report (which references Bion in numerous

places) concluded that:

(1) Adoption of the competitively-bid RFP program would reduce Pennsylvania’s Chesapeake

Bay nutrient reduction compliance costs by up to 80% through the purchase of verified nitrogen reductions from all public and

private sector sources, including technology providers such as Bion.

The Report estimates that adoption of a competitive

RFP program for nitrogen reductions would result in reducing Pennsylvania’s compliance expenditures from a projected cost

of $628M to $110M in 2015 and from $1.7B to $250M in 2025.

The Report further concludes that absent the implementation of

cost-cutting measures, Pennsylvania’s compliance with the storm water and agricultural reduction mandates in the CB TMDL

standard is at risk of default as there is insufficient funding available to comply under today’s existing cost structure.

The CB TMDL was established by the US EPA to protect and restore the Bay after decades of decline in water quality and aquatic

life due to excess nitrogen from the surrounding watershed.

(2) The use of verified nitrogen reductions from agricultural (and primarily livestock)

sources to achieve CB TMDL compliance will generate substantial economic and environmental benefits, well beyond the cost savings

of the CB TMDL compliance itself.

These ancillary benefits are in the form of increased agricultural investments and significant

improvements to the State’s local fresh water resources.

(3) Adoption would significantly reduce nitrogen and phosphorous impacts to local freshwater

resources such as streams, lakes and groundwater, thereby reducing long term freshwater quality compliance costs.

reductions would be a by-product of achieving Chesapeake Bay reductions since it requires (on average) the upstream reduction

of two to five pounds of nitrogen and as much as twenty pounds of phosphorous to achieve a one pound reduction of these nutrients

to the Chesapeake Bay.

The long term economic value and environmental benefits to interior freshwater sources could well

be greater than the downstream estuary cost savings and benefits.

The Report was updated in 2018 to reflect

new policies.

It now projects savings of up to 95 percent –

$340 million in costs versus $6.5 billion.

As discussed in the

original study, much of the savings were due to low-cost high-impact manure control projects.

The Report’s conclusions support

adoption of a competitive bidding platform for nitrogen reductions as a cost-effective solution to the high costs facing state

and local tax and rate payers.

The Report also demonstrates that this strategy would provide tangible environmental, economic,

quality of life and health benefits to those upstream rural communities which have shouldered much of the economic cost of downstream

nutrient reductions, with little or no benefit to their local communities.

2013, a report was issued by Pennsylvania State University ( https://www.usda.gov/oce/environmental_markets/files/EconomicTradingCBay.pdf )

which the PADEP Secretary in 2016 described as the most reliable estimate of the amount of financial resources required to fully

implement non-point source best management practices (BMPs) called for in Pennsylvania’s Watershed Implementation Plan (WIP).

This report provided two estimates.

The first estimate showed a need for $3.6 billion in capital costs to fully implement all non-point

source BMPs in the WIP, in incremental levels between 2011 and 2025.

The second estimate annualized costs through 2025 and included

operation and maintenance (O&M) costs, resulting in a figure of $378.3 million per year.

Overall, this 2013 PSU study projected

the state would need $378 million per year for 15 years, including O&M totaling $5.6 billion to place in service a sufficient

number of designated BMPs to achieve reductions of 24 million pounds of nitrogen annually.

The 2013 PSU study was completed

prior to guidance issued by US EPA Region 3 in 2014 which was adopted by the PADEP as a requirement for a one-for-three ‘uncertainty

factor’

be applied to BMPs in PA, since their actual performance is now known to be substantially less than previously modelled.

Accounting for the uncertainty factor, PA’s BMP cost estimate per the PSU study would need to be increased to $16.8 billion

(three times the $5.6 billion conclusion of the PSU study).

A significant portion of Bion’s current

activities concern efforts with private and public stakeholders (at local and state level) in PA, (and other Chesapeake Bay, Midwest

and Great Lakes states) and at the federal level (EPA and other executive departments and Congress) to establish appropriate public

policies which will create regulations and funding mechanisms that foster installation of the low cost, technology-based

environmental solutions that Bion (and others) can provide through clean-up of agricultural waste streams.

The Coalition for an

Affordable Bay Solution (“Coalition”) was formed to support the creation of a competitively-bid nitrogen trading program

in Pennsylvania that will enable Pennsylvania to capture the economic benefits outlined in the Report.

The Coalition supports legislation

to establish a competitively-bid RFP program for nitrogen reductions, where bids will also be ‘scored’

to reflect the

value of the benefits to PA’s interior waterways and communities.

Founding members of the Coalition represent both

Chesapeake Bay and national industry participants, and include Bion, JBS, SA, Kreider Farms, and Fair Oaks Farms.

The Company believes

i) the April 2015 release of a report from the Pennsylvania Auditor General titled “Special Report on the Importance

of Meeting Pennsylvania’s Chesapeake Bay Nutrient Reduction Targets”

which highlighted the economic consequences of

EPA-imposed sanctions if the state fails to meet the 2017 TMDL targets, as well as the need to support using low-cost solutions

and technologies as alternatives to higher-cost public infrastructure projects, where possible, and ii) Senate Bill 575 (successor

to prior SB 924, SB 724 and SB 799) which, if adopted, will establish a program that will allow the Pennsylvania’s tax- and

rate-payers to meet their EPA-mandated Chesapeake Bay pollution reductions at significantly lower cost by purchasing verified reductions

(by competitive bidding) from all sources, including those that Bion can produce through livestock waste treatment, represent visible

evidence of progress being made on these matters in Pennsylvania.

Such legislation, if passed and signed into law, will potentially

enable Bion (and others) to compete for public funding on an equal basis with subsidized agricultural ‘best management practices’

and public works and storm water authorities.

Note, however, that there has been vocal opposition to SB 575 (and its predecessors)

from threatened stakeholders committed to the existing status quo approaches--- a significant portion of which was focused on attacking

(in often inaccurate and/or vilifying ways) Bion in/through social media and internet articles, blogs, press releases, twitter

posts and re-tweets, rather than engaging the substantive issues.

If legislation similar to SB 575 is passed and implemented (in

something close to its current form), Bion expects that the policies and strategies being developed in PA will not only benefit

the Company’s existing and proposed PA projects, but will also subsequently provide the basis for a larger Chesapeake Bay

watershed strategy and, thereafter, a national clean water strategy.

The Company believes that Pennsylvania is ‘ground

in the long-standing clean water battle between agriculture and the further regulation of agriculture relative to nutrient

and depth, which lack of liquidity has negatively impacted Bion's business plans and will most likely continue delay PA2's Kreider 2 Project

and other proposed projects in PA.

The Company believes that Pennsylvania is potentially

‘ground zero’

in the long-standing clean water battle between agriculture and the further regulation of agriculture relative

to nutrient impacts.

The ability of Bion and other technology providers to achieve verified reductions from agricultural non-point sources

can resolve the current stalemate and enable implementation of constructive solutions that benefit all stakeholders, providing

a mechanism that ensures that taxpayer funds will be used to achieve the most beneficial result at the lowest cost, regardless

All sources, point and non-point, rural and urban, will be able to compete for tax payer-funded nitrogen reductions

in a fair and transparent process;

and since payment from the tax and rate payers would now be performance-based, these providers

will be held financially accountable.

We believe that the overwhelming environmental,

economic, quality of life and public health benefits to all stakeholders in the watershed, both within and outside of Pennsylvania,

make the case for adoption of the strategies outlined in the Report less an issue of ‘if’, but of ‘when and how’.

The adoption of a competitive procurement program will have significant positive impact on technology providers that can deliver

verified nitrogen reductions such as Bion, by allocating existing tax- and rate-payer clean water funding to low cost solutions

based upon a voluntary and transparent procurement process.

The Company believes that implementation of a competitively-bid nutrient

reduction program to achieve the goals for the Chesapeake Bay watershed can also provide a working policy model and platform for

other states to adopt that will enhance their efforts to comply with both current and future requirements for local and federal

estuarine watersheds, including the Mississippi River/Gulf of Mexico, the Great Lakes Basin and other nutrient-impaired watersheds.

Bion estimates that the overall market opportunity

for Bion in the Chesapeake Bay watershed is large and of long duration.

Most (if not all) of the publicly proposed new (or upgraded)

municipal waste water and storm water treatment facilities in the Chesapeake Bay watershed in PA, Maryland, Virginia and Washington,

DC have projected costs (capital and operating) far in excess of the costs involved in reducing nutrients using Bion’s technology

to treat CAFO wastes at the source.

While regulatory and enforcement policy is still evolving and, therefore, the impact of those

future policies upon Bion's operations cannot be precisely predicted and/or fully quantified, Bion believes that the tremendous

difference between its cost to remove nutrients from a concentrated livestock manure waste stream and the cost required for reduction

of nutrients from diluted conventional waste water and storm water treatment technologies, makes it reasonable to believe that

Bion's potential profitability from projects in the Chesapeake Bay watershed should be significant.

Based on the aggregate size

of livestock operations in the Chesapeake Bay watershed, Bion believes that the potential market for reductions in nitrogen loadings

to the Chesapeake Bay watershed from livestock can be reasonably anticipated to increase tenfold (or more) to total in excess of

75 million (or more) pounds annually (including airborne ammonia) over the next decade, with verified nutrient reductions potentially

generated equaling 50% to 60% of that aggregate required nitrogen reduction.

Bion hopes that some significant portion of the nutrient

reductions related to this clean-up mandate will be made by Bion Systems (which portion cannot be reasonably estimated at this

We believe that the credits from the (now dis-continued)

Kreider 1 dairy project (verified by the PADEP) represented the first nutrient credits from ‘multi-media’

water) reductions from an unregulated, non-point source (livestock) technology-based project to be verified (including ammonia

These credits will be equivalent to municipal wastewater treatment plant reductions, once regulatory issues are resolved.

Further, we believe this will provide, over time, a basis for credit trading basin-wide throughout the Chesapeake Bay watershed

(beyond just Pennsylvania where the credits are being generated to the other states and Washington, DC).

An established basin-wide

trading program will potentially broaden the market for credits from smaller local watersheds to the entire Chesapeake Bay Watershed.

Both USEPA and Maryland DNR have expressed support for basin-wide trading for the Bay.

Bion has undertaken, and will continue to pursue,

work to establish appropriate public policies to facilitate environmental clean-up of CAFOs in the Chesapeake Bay states and at

the federal level and in other locales.

Bion also believes that it is reasonable to

assume that a version of the Chesapeake Bay Program strategies developed by the US EPA and various state regulatory agencies to

address the issue of excess nitrogen loadings to the Chesapeake Bay watershed clean-up, will be subsequently applied to deal with

the much larger nutrient pollution problems of the Mississippi River Basin that are a primary cause of the 'Dead Zone' in the Gulf

of Mexico and similar problems in the Great Lakes and elsewhere.

The US EPA has stated the intention that the strategies being

developed for the Chesapeake Bay will be utilized in the Mississippi River Basin and other watersheds in the U.S.

Note, however,

that such an EPA initiative is certain to generate significant political opposition.

The Mississippi River Basin alone

has been estimated to require more than 1 billion pounds of annual nitrogen reduction to remediate the ‘dead zone’

in the Gulf of Mexico.

Applying the same metrics as above (Bion’s ability to profitably provide nitrogen reductions at a

cost of $8-12 per pound per year compared to municipal wastewater and storm water removal costs of $35 or higher per pound per

year), using Bion-type solutions would represent a potential benefit in excess of $25 billion annually to tax- and rate-payers

of the 31 Mississippi River Basin states and the federal government.

We believe that Bion will potentially have large business

opportunities for utilization of its technology as efforts to clean up such polluted areas develop, but at present such opportunities

are not quantifiable nor can a definitive timeline be predicted.

can resolve the current stalemate and enable implementation of constructive solutions that benefit all stakeholders, providing a mechanism

that ensures that taxpayer funds will be used to achieve the most beneficial result at the lowest cost, regardless of source.

point and non-point, rural and urban, will be able to compete for tax payer-funded nitrogen reductions in a fair and transparent process;

and since payment from the tax and rate payers would now be performance-based, these providers will be held financially accountable.

See the extended additional discussion regarding these

matters in our Annual Reports on Form 10-K for the year ended June 30, 2020 and prior years.

RECENT FINANCINGS

Sales of Common Stock during 2020 and 2019

During the year ended June 30, 2020, the Company

sold 3,168,001 shares of its unregistered common stock (not including 29,000 shares issued to entities for services and 143,316

shares issued upon conversion of debt).

During the year ended June 30, 2020, the Company sold 18,000 units at

$0.50 per unit and received gross proceeds of $9,000 and net proceeds of $8,100;

each unit consisting of one share

of the Company’s restricted common stock and one half warrant to purchase half a share of the Company’s restricted

common stock at $0.75 until December 31, 2020.

During the year ended June 30, 2020, the Company also sold 2,000,001

units at $0.50 per unit, and received gross proceeds of $1,000,000 and net proceeds of $910,500 with each unit consisting of one

share of the Company’s restricted common stock and one warrant to purchase one share of the Company’s restricted common

stock at $0.75 per share until December 31, 2020.

In addition, the Company also sold 1,150,000 units at$0.50 per unit and

received gross proceeds of $575,000 and net proceeds of $517,500 with each unit consisting of one share of the Company’s

restricted common stock and one warrant to purchase one share of the Company’s restricted common stock at $0.75 until December

During the year ended June 30, 2020, Mark Smith elected to convert a loan payable, accrued

expenses and interest of $15,000, $52,830 and $3,828 respectively, into an aggregate 143,316 units at $0.50 per unit, pursuant

to the 2006 Consolidated Incentive Plan with each unit consisting of one share of the common stock and one warrant to purchase

Sales of Common Stock during 2021 and 2020 Fiscal

During the year ended June 30, 2021, the Company entered

into subscription agreements, under three different offerings, to sell units for $0.50 per unit, with each unit consisting of one share

of the Company’s restricted common stock and one warrant to purchase one share of the Company’s restricted common stock for

$0.75 per share with an expiry date of December 31, 2021 and pursuant thereto, the Company issued 3,720,000 units for total proceeds of

$1,860,000, net proceeds of $1,699,000 after commissions of $161,000.

During the year ended June 30, 2021 300,000 shares

of the Company’s restricted company stock were sold to an investor for $300,000.

During the year ended June 30, 2021, 129,364 shares

of its unregistered common stock were issued as commissions.

During the year ended June 30, 2021, the company issued

1,186,824 units to various employees/consultants upon the conversion of debt pursuant to the 2006 Consolidated Incentive Plan with

each unit consisting of one share of the common stock and one warrant to purchase one share of the Company’s stock for $0.75 per

share until June 30, 2023.

During the year ended June 30, 2021, Mark Smith elected

to convert deferred compensation, accrued interest and accounts payable of $124,698, $3342 and $52,360 respectively into an aggregate

of 360,805 units at $0.50 per unit, pursuant to the 2006 Consolidated Incentive Plan with each unit consisting of one share of the common

stock and one warrant to purchase one share of the Company’s stock for $0.75 per share until December 31, 2024.

During the year ended June 30, 2021, the Company issued

144,000 units to Mr.

Smith for salary of $72,000, pursuant to the 2006 Consolidated Incentive Plan with each unit consisting of one share

of the common stock and one warrant to purchase one share of the Company’s stock for $0.75 per share until December 31, 2024.

During the year ended June 30, 2021, 4,065,988 warrants

were exercised to purchase 4,065,988 shares of the Company’s common stock at $0.75 per share for total proceeds of $3,049,491.

During the year ended June 30, 2020, the Company sold

3,168,001 shares of its unregistered common stock (not including 29,000 shares issued to entities for services and 143,316 shares issued

upon conversion of debt).

During the year ended June 30, 2020, the Company sold 18,000 units at $0.50 per unit and received

gross proceeds of $9,000 and net proceeds of $8,100;

each unit consisting of one share of the Company’s restricted common

stock and one half warrant to purchase half a share of the Company’s restricted common stock at $0.75 until December 31, 2020.

During the year ended June 30, 2020, the Company also sold 2,000,001 units at $0.50 per unit, and received gross proceeds of

$1,000,000 and net proceeds of $910,500 with each unit consisting of one share of the Company’s restricted common stock and one

warrant to purchase one share of the Company’s restricted common stock at $0.75 per share until December 31, 2020.

the Company also sold 1,150,000 units at$0.50 per unit and received gross proceeds of $575,000 and net proceeds of $517,500 with each

unit consisting of one share of the Company’s restricted common stock and one warrant to purchase one share of the Company’s

restricted common stock at $0.75 until December 31, 2021.

During the year ended June 30, 2020, Mark Smith elected to convert

a loan payable, accrued expenses and interest of $15,000, $52,830 and $3,828 respectively, into an aggregate 143,316 units at $0.50 per

unit, pursuant to the 2006 Consolidated Incentive Plan with each unit consisting of one share of the common stock and one warrant to purchase

one share of the Company’s stock for $0.75 per share until December 31, 2024.

During the year ended June 30, 2019, the Company

sold 1,793,606 shares of its unregistered common stock (not including the issuance of 18,162 shares to an employee pursuant to

its 2006 Consolidated Incentive Plan, 116,000 shares issued to entities for services and 200,000 shares issued upon conversion

During the year ended June 30, 2019, the Company sold 1,793,606 unregistered shares at $0.50 per share and received gross

proceeds of $896,801 and net proceeds of $832,921 including units consisting of one share of the Company’s restricted common

stock and one warrant to purchase half of a share of the Company’s restricted common stock at $0.75 per share with expiry

dates ranging from June 30, 2019 through December 31, 2020.

The Company also issued 1,028 shares of common stock as commissions.

There are a significant number of competitors

in the waste treatment industry who are working on animal related pollution issues.

Probably the most efficient way to assess competition

in this industry is to review the Newtrient Technology Catalog, a service provided by Newtrient which is an organization created

by the dairy industry to help farmers, technology providers, manure-based product developers

and other stakeholders assess manure related challenges and opportunities .

technologies reviewed by and organized by Newtrient in their catalog, such as Bion, address manure streams in addition to dairy.

There are a significant number of competitors in the

waste treatment industry who are working on animal related pollution issues.

Probably the most efficient way to assess competition in

this industry is to review the Newtrient Technology Catalog, a service provided by Newtrient Technology Catalog, which is produced by

an organization created by the dairy industry to help farmers, technology providers, manure-based

product developers and other stakeholders assess manure related challenges and opportunities .

Many of the technologies reviewed by and organized by Newtrient in their catalog, such as Bion, address manure streams in addition to

The potential competition has increased with the growing governmental and public concern focused on pollution due to CAFO wastes.

Waste treatment lagoons which depend on anaerobic microorganisms ("anaerobic lagoons") are the most common traditional

treatment process for animal waste on large farms within the swine and dairy industries.

Additionally, many beef feedlots,

poultry facilities and dairy farms simply scrape and accumulate manure for later field application.

Both lagoon and scrape/pile

manure storage approaches are coming under increasing regulatory pressure due to associated odor, nutrient management and water

quality issues and are facing possible phase-out in some states.

Although we believe that Bion’s comprehensive solution

is the most economically and technologically viable solution for the current problems, other alternative (though partial) solutions

do exist, including, for example, synthetic lagoon covers (which are placed on the top of the water in the lagoon to trap the gases),

methane digesters (a tank which uses anaerobic microorganisms to break down the waste to produce methane), multistage anaerobic

lagoons and solids separators (processes which separate large solids from fine solids), as well as various thermal waste-to-energy

technologies.

Additionally, many efforts are underway to develop and test new technologies.

Waste treatment lagoons which depend on anaerobic microorganisms ("anaerobic lagoons") are the most common traditional treatment

process for animal waste on large farms within the swine and dairy industries.

Additionally, many beef feedlots, poultry facilities

and dairy farms simply scrape and accumulate manure for later field application.

Both lagoon and scrape/pile manure storage approaches

are coming under increasing regulatory pressure due to associated odor, nutrient management and water quality issues and are facing possible

phase-out in some states.

Although we believe that Bion’s comprehensive solution is the most economically and technologically

viable solution for the current problems, other alternative (though partial) solutions do exist, including, for example, synthetic lagoon

covers (which are placed on the top of the water in the lagoon to trap the gases), methane digesters (a tank which uses anaerobic microorganisms

to break down the waste to produce methane), multistage anaerobic lagoons and solids separators (processes which separate large solids

from fine solids), as well as various thermal waste-to-energy technologies.

Additionally, many efforts are underway to develop and

test new technologies.

Our ability to compete is dependent upon favorable

regulatory conditions, our ability to obtain required approvals and permits from regulatory and other authorities and upon our

ability to introduce and market our Systems in the appropriate industry and geographic segments.

There is also extensive competition in the

organic soil amendment/fertilizer and feed ingredient markets.

There are many companies that are already selling products

to satisfy demand in the sectors of these markets we are trying to enter.

regulatory conditions, our ability to obtain required approvals and permits from regulatory and other authorities and upon our ability

to introduce and market our Systems in the appropriate industry and geographic segments.

There is also extensive competition in the sustainable

beef and sustainable organic beef market segments and organic soil amendment/fertilizer and feed ingredient markets that are being targeted

by Bion’s 3G Tech JVs as discussed above.

There are many companies that are already selling

products to satisfy demand in the sectors of these markets we are trying to enter.

Many of these companies have established marketing

and sales organizations and customer commitments, are supporting their products with advertising, sometimes on a national basis,

and have developed brand name recognition and customer loyalty in many cases.

Because Bion systems offer a comprehensive solution

that is designed to produce up to four separate and distinct revenue streams, the Company believes that it has the ability to be

more competitive in any one of the sectors from which it derives revenue.

and sales organizations and customer commitments, are supporting their products with advertising, sometimes on a national basis, and have

developed brand name recognition and customer loyalty in many cases.

Because Bion systems offer a comprehensive waste treatment

solution that is designed to produce/augment up to four separate and distinct revenue streams, the Company believes that it has the ability

to be competitive in each of the sectors from which it derives revenue.

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 few Projects commencing during 2021, 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.

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 few Projects commencing during 2021and 2022 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.

In our CAFO Retrofit/remediation business segment,

we currently have only built one system and it is no longer operating and only have contracts with only a single party.

there are thousands of CAFO’s in the United States and we anticipate that in the future we will have agreements with many

CAFO customers.

We are the sole owner of nine United States

However, there

are thousands of CAFO’s in the United States and we anticipate that in the future we will have agreements with many CAFO customers.

We are the sole owner of seven United States patents.

Bion also owns one Australian patent, two Canadian patents, one patent from New Zealand and two patents from Mexico.

Additionally, Bion

has one United States patent application pending and has three International patent applications currently pending.

Patent Numbers and date of issue:

United States Currently Issued:

(1) 6,689,274:

Low Oxygen Organic Waste Bioconversion System:

(NdeN) Jere Northrop

Morris (Exp 6/28/2021)

(2) 6,908,495:

Low Oxygen Organic Waste Bioconversion System:

(NdeN+divisional)

Jere Northrop & James W.

Morris (Exp 5/2/2021)

(3) 7,431,839:

Low Oxygen Biologically Mediated Nutrient Removal:

(NdeN+PwA) James

Morris & Jere Northrop (Exp 12/26/2021)

(4) 7,575, 685:

Low Oxygen Biologically Mediated Nutrient Removal:

(NdeN+PwoA) James W.

(NdeN+PwA) James W.

Morris & Jere Northrop (Exp 12/26/2021)

(5) 7,879,589:

Micro-Electron Acceptor Phosphorous Accumulating Organisms:

Microbial) James W.

Morris & Jere Northrop (Exp 11/10/20)

(6) 8,039,242:

(NdeN+PwoA Microbial) James W.

Morris & Jere Northrop

(Exp 6/20/2023)

Low Oxygen Biologically Mediated Nutrient Removal:

(NdeN+PwoA Microbial)

(NdeN+PwoA Microbial) James W.

Morris & Jere Northrop (Exp 6/20/2023)

(7) 8,287,734:

Method for Treating Nitrogen in Waste Streams:

(OCN) Jere Northrop

(OCN) Jere Northrop & James W.

Morris (Exp 3/20/31)

(8) 10,106,447:

Process to Recover Ammonium Bicarbonate from Wastewater:

Morton Orentlicher

Morton Orentlicher & Mark M.

(6) 10,604,432:

Process to Recover Ammonium Bicarbonate from Wastewater;

Bassani, Steve Pagano, Morton Orentlicher & Mark M.

to Recover Ammonium Bicarbonate from Wastewater;

Dominic Bassani, Steve Pagano, Morton Orentlicher & Mark M.

(Exp 6/29/2037)

Australia Issued:

(7) 10,793,458:

to Recover Ammonium Bicarbonate from Wastewater;

Dominic Bassani, Steve Pagano, Morton Orentlicher & Mark M.

(Exp 9/14/2035)

Australia Issued:

Low Oxygen Organic Waste Bioconversion System:

(NdeN) Jere Northrop &

(NdeN) Jere Northrop & James W.

Morris (Exp 11/8/2021).

1 unchanged sentence

(1) 2,428,417:

Low Oxygen Organic Waste Bioconversion System:

(NdeN) Jere Northrop &

Organic Waste Bioconversion System:

(NdeN) Jere Northrop & James W.

Morris (Exp 11/8/21).

(2) 2,503,166:

Low Oxygen Biologically Mediated Nutrient Removal:

(NdeN+PwA) Jere Northrop

Biologically Mediated Nutrient Removal:

(NdeN+PwA) Jere Northrop & James W.

Morris (Exp 11/8/21).

1 unchanged sentence

Low Oxygen Organic Waste Bioconversion System;

9/8/06 (notified 3/26/07)

(NdeN) Jere Northrop & James W.

9/8/06 (notified 3/26/07) (NdeN) Jere Northrop & James W.

Morris (Exp 11/8/2021).

Low Oxygen Organic Waste Bioconversion System:

(NdeN) Jere Northrop &

(NdeN) Jere Northrop & James W.

Morris (Exp 11/8/2021).

1 unchanged sentence

Low Oxygen Organic Waste Bioconversion System:

(NdeN) Jere Northrop &

(NdeN) Jere Northrop & James W.

Morris (Exp 11/8/2021).

We are also the sole owner of, or possess the

contractual right to acquire exclusive patent rights to, two pending United States patent applications (one of which has received

a Notice of Allowance) and two international (PCT) patent applications as set forth below:

We are also the sole owner of, or possess the contractual

right to acquire exclusive patent rights to, a pending United States patent application and three international applications as set forth

United States Currently Pending:

(1) 16/139,709:

Process to Recover Ammonium Bicarbonate from Wastewater;

Dominic Bassani,

Steve Pagano, Morton Orentlicher & Mark M.

Simon (Notice of Allowance received).

(2) 16/790,390:

Dominic Bassani, Steve Pagano, Morton Orentlicher & Mark M.

International Applications Currently Pending:

(1) EP18943551:

Process to recover ammonium bicarbonate from wastewater;

Dominic Bassani,

Steve Pagano, Morton Orentlicher & Mark M.

International (PCT) Currently Pending:

(1) PCT/US2016/13254:

Dominic Bassani, Steve Pagano, Morton

Orentlicher & Mark M.

(2) CA3123802A1:

Process to recover ammonium bicarbonate from wastewater;

Morton Orentlicher & Mark

(Application Published).

(2) PCT/US2018/67247:

Dominic Bassani, Steve Pagano, Morton

Orentlicher & Mark M.

(3) MX/a/2021/007358:

Process to recover ammonium bicarbonate from wastewater;

1 unchanged sentence

Morton Orentlicher & Mark M.

(Application Published).

In addition to such factors as innovation,

technological expertise and experienced personnel, we believe that a strong patent position is increasingly 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.

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.

In addition to such factors as innovation, technological

expertise and experienced personnel, we believe that a strong patent position is increasingly 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.

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.

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

toward completion of the development and ongoing improvement of our 3G Tech (the initial version of which is ready for implementation

in an appropriate Project) with emphasis on increased recovery of valuable by-products (including nutrients in organic and/or

non-organic forms, production of renewable energy from by-products together with related renewable energy and/or environmental

Bion believes its 3G Tech will produce significantly greater value from the CAFO waste stream through the recovery of

a concentrated natural nitrogen fertilizer and pipeline-quality natural gas.

During the years ended June 30, 2020 and June 30, 2019, respectively,

we expended approximately $438,000 and $435,000 (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.

During the 2018 fiscal year, Bion’s research and development has been primarily focused on development work

to complete and further refine development of our 3G Tech 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 3G Tech 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

As a result of these efforts (including their continuation during the current period), Bion made new (and supplemental)

patent filing(s) during the 2020 and 2019 fiscal years related to our 3G Tech.

The Company anticipates completion of its pilot

system and pre-commercial testing for its 3G Tech by end of the current calendar year to support design finalization for our initial

3G Tech systems.

Current research and development work is focused on

completion of the development and ongoing improvement of our 3G Tech (the initial version of which is ready for implementation in an appropriate

Project) with emphasis on increased recovery of valuable by-products (including nutrients in organic and/or non-organic forms, production

of renewable energy from by-products together with related renewable energy and/or environmental credits).

Bion believes its 3G Tech will

produce significantly greater value from the CAFO waste stream through the recovery of a concentrated natural nitrogen fertilizer

and pipeline-quality natural gas.

During the years ended June 30, 2021 and June 30, 2020, respectively, we

expended approximately $547,000 and $478,000 (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 3G Tech 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 3G Tech

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 3G Tech.

The Company anticipates completion of its pilot system and pre-commercial testing for its 3G Tech by end of the current calendar year

to support design finalization for our initial 3G Tech systems.

Our technology focus is to separate and aggregate the various “assets”

in the waste stream and then

to re-assemble them to maximize their economic value.

Our current research and development efforts have been focused on developments

that will minimize water removal requirements thereby significantly reducing the associated energy costs.

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.

in the waste stream and then to re-assemble them to maximize their economic value.

Our current research and development efforts have been

focused on developments that will minimize water removal requirements thereby significantly reducing the associated energy costs.

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

Bion continues to focus on “normalizing”

its technology platform for use on multiple species.

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”

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

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 regards 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

waste treatment and are impacted by environmental regulations in at least five different ways:

Our marketing and sales success depends, to a substantial degree, 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;

To date, research and development results have supported our objectives.

Environmental Protection/Regulation and Public

In regards 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.

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 waste treatment and are

impacted by environmental regulations in at least five different ways:

Our marketing and sales success depends, to a substantial degree, 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;

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;

Appropriate public policies need to be developed and implemented to facilitate environmental clean-up at CAFOs and the sale of

nutrient reductions from such activities in order for the Company to monetize the nutrient reductions generated by its facilities.

Additionally, our activities are affected

by many public policies and regulations (federal, state and local) related to other industries such as 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.

As of September 1, 2020, we had 6 employees

and primary consultants, all of whom are performing services for the Company on a full-time basis.

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;

Appropriate public policies need to be developed and implemented to facilitate environmental clean-up at CAFOs and the sale of nutrient

reductions from such activities in order for the Company to monetize the nutrient reductions generated by its facilities.

Additionally, our activities are affected by many

public policies and regulations (federal, state and local) related to other industries such as 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.

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

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’s on packaging.

As of September 1, 2021, we had 6 employees and

primary consultants, all of whom are performing services for the Company on a full-time basis.

The Company utilizes other consultants

and professionals on an ‘as needed’

Our future success depends in significant part 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"

Our future success depends in significant part 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.

4 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business