What changed in this filing

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Item 9A. Controls and Procedures

2025-09-29 compared with 2024-09-30 · 1227 added, 1281 removed, 967 unchanged (72% of the section changed)

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Disclosure Controls and Procedures

As of June 30, 2024, under the supervision and with

the participation of the Company’s President and Principal Financial Officer (the same person), management has evaluated the effectiveness

of the design and operations of the Company’s disclosure controls and procedures.

Based on that evaluation, the President and Principal

Financial Office concluded that the Company’s disclosure controls and procedures were not effective as of June 30, 2024 as a result

of the material weakness in internal control over financial reporting discussed below.

As of June 30, 2025, under the supervision and

with the participation of the Company’s President and Principal Financial Officer (the same person), management has evaluated the

effectiveness of the design and operations of the Company’s disclosure controls and procedures.

Based on that evaluation, the President

and Principal Financial Office concluded that the Company’s disclosure controls and procedures were not effective as of June 30,

2025 as a result of the material weakness in internal control over financial reporting discussed below.

Changes in Internal Control over Financial Reporting

There were no changes in internal control over financial

reporting that occurred during the last fiscal quarter covered by this report that have materially affected, or are reasonably likely

to materially affect, the Company’s internal control over financial reporting.

Management’s Report on Internal Control over Financial Reporting

Our management is responsible for establishing and

maintaining adequate internal control over financial reporting, as such term is defined in the Securities Exchange Act of 1934 Rule 13a-15(f).

Our Chief Executive Officer and Principal Financial Officer (the same person) conducted an evaluation of the effectiveness of our internal

control over financial reporting based on the framework in Internal Control – Integrated Framework, issued by the Committee of Sponsoring

Organizations of the Treadway Commission (“COSO Framework”) and the related guidance provided in Internal Control Over Financial

Reporting – Guidance for Smaller Public Companies, also issued by the Committee of Sponsoring Organizations.

There were no changes in internal control over

financial reporting that occurred during the last fiscal quarter covered by this report that have materially affected, or are reasonably

likely to materially affect, the Company’s internal control over financial reporting.

Management’s Report on Internal Control over Financial

Our management is responsible for establishing

and maintaining adequate internal control over financial reporting, as such term is defined in the Securities Exchange Act of 1934 Rule

Our Chief Executive Officer and Principal Financial Officer (the same person) conducted an evaluation of the effectiveness

of our internal control over financial reporting based on the framework in Internal Control – Integrated Framework, issued by the

Committee of Sponsoring Organizations of the Treadway Commission (“COSO Framework”) and the related guidance provided in Internal

Control Over Financial Reporting – Guidance for Smaller Public Companies, also issued by the Committee of Sponsoring Organizations.

Based on this evaluation, management has concluded

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that permit the Company to provide only management’s report on internal control in this annual report.

Bank account hacking

On June 23, 2023, an officer of the Company

with personal accounts with Signature Bank was hacked and $75,000 was transferred from the Company’s accounts at Signature Bank

to the officer’s personal accounts.

The bank was notified and all Company accounts were placed on hold.

Subsequently, the funds

were released and transferred back to the Company prior to June 30, 2023 the end of the fiscal year and there were no losses incurred.

The Company has reviewed the authorized individuals

on all accounts and further limited access to its bank accounts after the hacking incident.

OTHER INFORMATION

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Chief Executive Officer and Director

Stephen Posner

Greg Schoener

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Robert Weerts

Stephen Craig (Craig) Scott ( 64) has

been associated with Bion since 1993.

Stephen Craig (Craig) Scott ( 65)

has been associated with Bion since 1993.

Since that time he has been responsible for business and industry intelligence and analysis.

was with Bion full-time from 1996 to 2000, then periodically as a consultant through 2005.

Craig rejoined Bion in 2006 and has held several

senior positions, including Director of Communications, SVP – Capital Markets, and Head of Business Development.

As of June 2024,

He was with Bion full-time from 1996 to 2000, then periodically as a consultant through 2005.

Craig rejoined Bion in 2006 and has held

several senior positions, including Director of Communications, SVP – Capital Markets, and Head of Business Development.

2024, he joined Bion’s Board of Directors and was subsequently named Interim Chief Executive Officer.

Craig studied business and communications

at Montana State and Denver-Metro Universities.

Jon Northrop (81) has served as our

Secretary and a Director since March of 2003.

Since September 2001 he has been self employed as a consultant with a practice focused on

business buyer advocacy.

Craig studied business and

communications at Montana State and Denver-Metro Universities.

Jon Northrop (82) has served as

our Secretary and a Director since March of 2003.

Since September 2001 he has been self employed as a consultant with a practice focused

on business buyer advocacy.

Northrop is one of our founders and served as our Chief Executive Officer and a Director from our inception

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graduate research in low energy particle physics at Case Institute of Technology, Cleveland.

Stephen Posner (81) is a financial

markets professional with a 50 year career raising capital, increasing public awareness, and advising on corporate strategy and M&A

for companies.

He is experienced in facilitating the growth of both large and small companies, private and public.

He is currently a Director

of a family of ETF’s.

He is a proud husband, father, and grandpa and has been involved with Bion and a substantial shareholder in

the company for 25 years.

He received a BA from Hofstra University, in New York.

Gregory (Greg) Schoener ( 57) currently

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Schoener is a Bion Shareholder since 2020.

William (Bill) Rupp (63) has served

as a director of the company since February 15, 2023.He is a ‘meat industry leader’ who served as President of JBS Beef from

2010-2016 with responsibility for the leadership of JBS’s North American Beef business.

He was CEO of Meyer Natural Foods from 2009-2010.

Rupp served in various management roles for Cargill Beef from 1983 until 2009 where he was President from 1998-2008 with responsibility

for Cargill’s global beef business with operations in US, Canada, Argentina, and Australia.

He graduated from the University of

South Dakota with a B.S.

in Business Administration in 1983.

Rupp also serves on the boards of Sustainable Beef, DecisionNext, Superior

Lamb and Lumachain.

Zizza (78) Salvatore Zizza

has served as a director of Bion since February 15, 2023.

Zizza (79) Salvatore

Zizza has served as a director of Bion since February 15, 2023.

He is presently President of Zizza & Associates Corp.

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member/Chairman of the Corn Plus Ethanol Plant.

Schafer (78) Edward Schafer

previously served the Company’s senior management team as Executive Vice Chairman and has been a member of the Company’s Board

of Directors since January 1, 2011.

Schafer had served as a consultant to Bion since July 2010.

Schafer served as a director of

Continental Resources (NYSE-CLR) 2011-2016.

He also chairs the Board of Directors of Dynamic Food Ingredients.

In addition, he has served

on the Board of Governors of Amity Technology LLP since 2009.

Schafer served as a trustee of the Investors Real Estate Trust (NASDAQGS-IRET)

from September 2009 to October 2011.

He also served as a trustee of the IRET from September 2006 through December 2007, when he resigned

from the IRET’s Board to serve as Secretary of the U.S.

Department of Agriculture under President George W.

a private investor, is a two-term former Governor of North Dakota.

He served as Chief Executive Officer of Extend America, a telecommunications

company, from 2001 to 2006, and he has been a member of the Boards of RDO Equipment Co., a privately-owned agricultural and construction

equipment company (August 2001 to July 2003) and the University of North Dakota Foundation (June 2005 to December 2007).

Since 2019 Mr.

Schafer has served on the Board of Directors of Cellular Biomedicine Group (NASDAQ:

CBMG) and is Chairman of its Audit Committee.

Schafer serves as a board member of the Center for Innovation at the University of North Dakota and is an adjunct professor at North Dakota

State University.

Schafer is a past chair of the Republican Governors Association, the Midwestern Governors’ Association, the

Interstate Oil and Gas Compact, the Western Governors’ Association and served as the 29 th United States Secretary of

Agricultural from 2008 to 2009.

Schafer holds a master’s degree in business administration from the University of Denver.

Schafer brings the following experience, qualifications, attributes and skills to the Company:

general business management, budgeting

and strategic planning experience from his service as Chief Executive Officer of Extend America and extensive government, regulatory,

strategic planning, budgeting administrative and public affairs experience from his service as Governor of North Dakota and Secretary

of the US Department of Agriculture.

Turk Stovall (48) Turk Stovall

has been a member of The Company’s Board of Directors since June 27, 2024.

Stovall is a fifth-generation Montana

rancher and CEO/owner of Stovall Ranching Companies and Yellowstone Cattle Feeders.

Stovall has held management positions

with Certified Angus Beef, and North Platte Feeders.

Stovall serves as Second VP of the Montana Stockgrowers Association and

has served on the Cattleman’s Beef Board by appointment of the US Secretary of Agriculture.

Stovall earned a BS in Animal

Science from Montana State;

an MS in Animal Science from Oklahoma State and an MBA from Purdue.

Family Relationships

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Compliance with Section 16(a) of the Exchange

Section 16(a) of the Exchange Act requires our officers

and directors, and stockholders owning more than ten percent of a registered class of our equity securities, to file reports of ownership

and changes in ownership with the Securities and Exchange Commission.

The Company is not aware of any persons who failed to timely file

reports under this section.

Section 16(a) of the Exchange Act requires our

officers and directors, and stockholders owning more than ten percent of a registered class of our equity securities, to file reports

of ownership and changes in ownership with the Securities and Exchange Commission.

The Company is not aware of any persons who failed

to timely file reports under this section.

Involvement in Legal Proceedings

To the best of our knowledge, during the past five

years, none of the following occurred with respect to our directors or executive officers:

To the best of our knowledge, during the past

five years, none of the following occurred with respect to our directors or executive officers:

any bankruptcy petition filed by or against any business of which one of them was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time;

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Audit Committee

The Company has no audit committee and is not now

required to have one, or an audit committee financial expert.

The Company has no audit committee and is not

now required to have one, or an audit committee financial expert.

Code of Ethics

To date, the Company has not adopted a code of business

conduct and ethics applicable to its officers, directors or accounting officer.

To date, the Company has not adopted a code of

business conduct and ethics applicable to its officers, directors or accounting officer.

Advisory Group

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SUMMARY COMPENSATION TABLE

The following table sets forth the compensation paid

to, or accrued for, each of our current executive officers during each of our last two fiscal years.

The following table sets forth the compensation

paid to, or accrued for, each of our current executive officers during each of our last two fiscal years.

Name and Principal Position

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President and Chief

Financial Officer

Financial Officer (retired July 31, 2024)

Brightcap/Dominic Bassani (4)

VP - Special Projects & Strategic

Planning and Chief Operating Officer

Planning and Chief Operating Officer (passed away November 11, 2023

William O'Neill

Chief Executive Officer (5) (resigned May 31, 2024)

Chief Executive Officer (6)

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Reflects the dollar amount expensed by the Company during the applicable fiscal year for financial statement reporting purposes pursuant to ASC 718.

Since October 2016, the Company approved a month-to-month contract extension

with Smith which included a monthly deferred salary of $18,000 and the right to convert up to $300,000 of deferred compensation,

at his sole election, at $0.75 per share until December 31, 2022 (which date was extended to January 15, 2025).

also has the right to convert his deferred compensation in whole or in part, at this sole election, at any time in an amount at "market"

or into securities sold in the Company's most current/recent private offering.

During fiscal year 2021 the Company paid Smith

$13,460 for payroll taxes on his deferred compensation conversions which was treated as salary.

During the fiscal year 2024,

Smith’s compensation was reduced to $10,000 per month as of January 1, 2024 and Smith deferred $190,000 due to cash restraints of

Since October 2016, the Company approved a month-to-month contract extension with Smith which included a monthly deferred salary of $18,000 and the right to convert up to $300,000 of deferred compensation, at his sole election, at $0.75 per share until December 31, 2022 (which date was extended to January 15, 2025).

Smith also has the right to convert his deferred compensation in whole or in part, at this sole election, at any time in an amount at "market" or into securities sold in the Company's most current/recent private offering.

During fiscal year 2021 the Company paid Smith $13,460 for payroll taxes on his deferred compensation conversions which was treated as salary.

During the fiscal year 2024, Smith’s compensation was reduced to $10,000 per month as of January 1, 2024 and Smith deferred $190,000 due to cash restraints of the company.

Smith retired effective July 31, 2024, and his salary ceased accruing at that time.

On February 10, 2015, Mr.

Bassani agreed to an extension to continue his employment

through December 31, 2017 at an annual salary of $372,000 effective January 1, 2015.

During October 2016, Bassani was

granted the right to convert up to $125,000 of his deferred compensation, at his sole election, at $0.75 per share which was

expanded on April 27, 2017 to the right to convert up to $300,000).

During February 2018, the Company agreed to the material

terms of a binding two-year extension agreement.

Bassani's annual salary will remain at $372,000 and the Company granted Bassani

2,000,000 fully vested options at $0.75 per share with an expiry date of December 31, 2024 which contain a 90% exercise price adjustment

and the options may be extended for an additional 5 years at $0.01 per share per extension year.

Bassani passed away on November

11, 2023, and his salary ceased accruing at that time.

On May 1, 2022 William O'Neill joined the Company with an annual salary of

$420,000 which includes $10,000 monthly deferred compensation to be paid at the discretion of the Board.

There is an additional

$1,500 per month health insurance allowance.

Bassani agreed to an extension to continue his employment through December 31, 2017 at an annual salary of $372,000 effective January 1, 2015.

During October 2016, Bassani was granted the right to convert up to $125,000 of his deferred compensation, at his sole election, at $0.75 per share which was expanded on April 27, 2017 to the right to convert up to $300,000).

During February 2018, the Company agreed to the material terms of a binding two-year extension agreement.

Bassani's annual salary will remain at $372,000 and the Company granted Bassani 2,000,000 fully vested options at $0.75 per share with an expiry date of December 31, 2024 which contain a 90% exercise price adjustment and the options may be extended for an additional 5 years at $0.01 per share per extension year.

Bassani passed away on November 11, 2023, and his salary ceased accruing at that time.

On May 1, 2022 William O'Neill joined the Company

with an annual salary of $420,000 which includes $10,000 monthly deferred compensation to be paid at the discretion of the Board.

is an additional $1,500 per month health insurance allowance.

Terms of the contract are thirty-seven months.

O'Neill was previously

paid as a contractor through Identifoods.

was previously paid as a contractor through Identifoods.

O’Neill resigned as of May 31, 2024.

Total payments for the years ended June 30,

2024 and June 2023, respectively were $20,000 and $318,000.

Total payments for the years ended

June 30, 2025 and June 2024, respectively were nil and $20,000.

Stephen Craig Scott

(“Scott”) was appointed interim CEO on June 1, 2024.

Scott has held various

positions as employee/consultant with the Company since 1993 including Director of Communications, SVP – Capital Markets and Head

of Business Development.

On October 25, 2023, Scott entered into an agreement with the Company which included provisions for a monthly

salary of $14,000 of which $2,000 is deferred.

During the year ended June 30, 2025 and 2024, Scott deferred substantial portions of his

monthly salary to help the Company conserve cash.

For the year ended June 30, 2025 and 2024, Scott was paid $5,000 and $64,000 respectively.

During the fiscal year ended June 30, 2025 the Company extended options and warrants which had a non-cash value of $249,000 for Craig

Employment Agreements:

Stephen Craig Scott (“Scott”)

was appointed interim CEO on June 1, 2024.

Scott has held various positions as employee/consultant with the Company since 1993 including

Director of Communications, SVP – Capital Markets and Head of Business Development.

Stephen Craig Scott (“Scott”) was

appointed interim CEO on June 1, 2024.

Scott has held various positions as employee/consultant with the Company since 1993 including Director

of Communications, SVP – Capital Markets and Head of Business Development.

On October 25, 2023, Scott entered into an agreement

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2024, Scott was paid $5,000 and $64,000 respectively.

Gregory (Greg) Schoener (“Schoener”) currently serves as the

interim COO of the company and as a Director since June 1, 2024.

Gregory (Greg) Schoener (“Schoener”) currently serves as

the interim COO of the company and as a Director since June 1, 2024.

Schoener currently has no agreement with the Company and is not receiving

any compensation.

Smith (“Smith”) has held the positions

of Executive Chairman, Director, President and General Counsel of Company and its subsidiaries under various agreements and terms from

March 2003 (details regard earlier years and periods between 2003 and 2020 may be found in the Company’s prior Forms 10-K and other

SEC filings) until his retirement on July 31, 2024.

Pursuant to the extension agreements after expiration of agreements during the prior

decades, Smith continued his agreement to:

i) defer his cash compensation ($18,000 per month) until the Board of Directors re-instates

cash payments to all employees and consultants who are deferring their compensation.

Due to expiration of his most recent extension, Mr.

Smith (“Smith”) has held the

positions of Executive Chairman, Director, President and General Counsel of Company and its subsidiaries under various agreements and

terms from March 2003 (details regard earlier years and periods between 2003 and 2020 may be found in the Company’s prior Forms

10-K and other SEC filings) until his retirement on July 31, 2024.

Pursuant to the extension agreements after expiration of agreements

during the prior decades, Smith continued his agreement to:

i) defer his cash compensation ($18,000 per month) until the Board of Directors

re-instates cash payments to all employees and consultants who are deferring their compensation.

Due to expiration of his most recent

extension, Mr.

Smith served the Company on a month-to –month basis through his retirement.

On April 29, 2022, Smith’s nominal monthly salary

was increased to $25,000, of which $5,000 was to be deferred each month, but, in actuality, much or all of his salary was deferred over

recent years and then converted into securities of the Company by Smith.

Smith may provide some transition related services for the

Company on a consulting basis over the course of the current year.

Dominic Bassani (“Bassani”) served in

senior management positions with the Company (as a full-time consultant) from 2001 until his death during 2023.

See prior Forms 10-K for

detailed summaries regarding his agreements and compensation (much of which was deferred) and/or taken in the form of securities of the

On April 29, 2022, Smith’s nominal

monthly salary was increased to $25,000, of which $5,000 was to be deferred each month, but, in actuality, much or all of his salary was

deferred over recent years and then converted into securities of the Company by Smith.

Smith may provide some transition related services

for the Company on a consulting basis over the course of the current year.

Dominic Bassani (“Bassani”) served

in senior management positions with the Company (as a full-time consultant) from 2001 until his death during 2023.

See prior Forms 10-K

for detailed summaries regarding his agreements and compensation (much of which was deferred) and/or taken in the form of securities of

William O’Neill (“O’Neill”)

joined as the Company’s Chief Executive Officer (“CEO”) effective May 1, 2022.

O’Neill had previously been

working with the Company as a consultant and had been employed by the Company as its CEO during 2010-2011.

The Company and O’Neill

have entered into a thirty-seven (37) month employment agreement (subject to Board renewal for the final two (2) years during the 13th month)

O’Neill had previously been working

with the Company as a consultant and had been employed by the Company as its CEO during 2010-2011.

The Company and O’Neill have

entered into a thirty-seven (37) month employment agreement (subject to Board renewal for the final two (2) years during the 13th month)

with compensation of $25,000 cash and $10,000 deferred compensation per month.

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times) to extend the maturity date of the outstanding 2020 Convertible Obligations and 2015 Convertible Notes (“CVObligations”)

set forth in the paragraphs above from December 31, 2017 (initial maturity date) to January 15, 2025 (current maturity date) which is

set forth in the paragraphs above from December 31, 2017 (initial maturity date) to September 15, 2025 (current maturity date) which is

also the maturity date of all CV Obligations after adjustment.

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portion of the CVObligations (as adjusted, if applicable) was accrued.

The warrants and options have been extended to September 15, 2025.

Other Agreements

The Company has declared contingent deferred

stock bonuses to its key employees and consultants at various times throughout the years.

The Company has declared contingent deferred stock

bonuses to its key employees and consultants at various times throughout the years.

The stock bonuses were contingent upon the Company’s

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In consideration for the cancellations, the Company granted 109,500 fully vested options to these employees and a consultant to purchase

common stock of the Company at $1.00 per share until December 31, 2024 (including recent extensions).

common stock of the Company at $1.00 per share until September 15, 2025 (including recent extensions).

OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END

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Rights That Have

Brightcap/ Dominic Bassani (2)

Edward Schafer (3)

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Options are subject to a 90% execution/exercise price adjustment upon notice of intent to exercise under certain conditions.

Options are subject to a 50% execution/exercise

price adjustment upon notice of intent to exercise under certain conditions.

Options are subject to a 50% execution/exercise price adjustment upon notice of intent to exercise under certain conditions.

Director Compensation

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Greg Schoener

Edward Schafer

Salvatore Zizza

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Reflects the dollar amount expensed by the Company during the applicable fiscal year for financial statement reporting purposes pursuant to ASC 718.

SECURITY OWNERSHIP OF

CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

As of August 1, 2024, the Registrant had 57,236,479 shares

of common stock issued and 56,532,170 shares of common stock outstanding.

(balance of 704,309 shares are owned by Centerpoint, the Company’s

majority-owned subsidiary).

SECURITY OWNERSHIP

OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

As of August 1, 2025, the Registrant had

57,386,476 shares of common stock issued and 56,682,167 shares of common stock outstanding.

(balance of 704,309 shares are owned

by Centerpoint, the Company’s majority-owned subsidiary).

The following table sets forth certain information

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● each of our directors;

● each of our executive officers

and significant employees;

● each of our executive

officers and significant employees;

● all our executive officers,

directors and significant employees as a group.

Under the rules of the Securities and Exchange Commission,

beneficial ownership includes voting or investment power with respect to securities and includes the shares issuable under stock options,

warrants and convertible securities that are exercisable/convertible within sixty (60) days of August 1, 2024.

Those shares issuable

under stock options, warrants and/or convertible securities are deemed outstanding for computing the percentage of each person holding

options, warrants and/or convertible securities but are not deemed outstanding for computing the percentage of any other person.

The percentage of beneficial ownership schedule ‘Entitled to Vote’ is based upon 56,532,170 shares outstanding as of

August 1, 2024.

The address for those individuals for which an address is not otherwise provided is c/o Bion Environmental Technologies,

c/o PO Box 323, Old Bethpage, NY 11804.

To our knowledge, except as indicated in the footnotes to this table and pursuant to applicable

community property laws, the persons named in the table have sole voting power and investment power with respect to all shares of common

stock listed as owned by them.

Under the rules of the Securities and Exchange

Commission, beneficial ownership includes voting or investment power with respect to securities and includes the shares issuable under

stock options, warrants and convertible securities that are exercisable/convertible within sixty (60) days of August 1, 2024.

shares issuable under stock options, warrants and/or convertible securities are deemed outstanding for computing the percentage of each

person holding options, warrants and/or convertible securities but are not deemed outstanding for computing the percentage of any other

The percentage of beneficial ownership schedule ‘Entitled to Vote’ is based upon 56,532,170 shares outstanding

as of August 1, 2024.

The address for those individuals for which an address is not otherwise provided is c/o Bion Environmental

Technologies, c/o PO Box 323, Old Bethpage, NY 11804.

To our knowledge, except as indicated in the footnotes to this table and pursuant

to applicable community property laws, the persons named in the table have sole voting power and investment power with respect to all

shares of common stock listed as owned by them.

Name and Address

Percent of Class Outstanding

of Class Outstanding

Centerpoint Corporation (1)

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New York, NY 11804

Turk Stovall (9)

c/o PO Box 323

Old Bethpage NY 11804

Craig Scott (9)

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New York, NY 10022

William Rupp (13)

Loveland, CO 80539

Stephan Posner (12)

219 Augusta Ct.

Roslyn, NY 11576

All executive officers and directors as a group (10 persons)

Centerpoint Corporation

is currently majority owned by the Company.

Under Colorado law, Centerpoint Corporation is not entitled to vote these shares unless

otherwise ordered by a court.

These shares of common stock may be distributed to the shareholders of Centerpoint Corporation at a

future date pursuant to a dividend declared during July 2004.

The shares distributed to Bion, if any, will be cancelled immediately

upon receipt.

535,221 shares, 1,215,000 shares underlying warrants held directly by Linda Bassani, and

909,747 shares held in IRA accounts.

Also included are the shares set forth below owned (directly

and indirectly) by Mr.

Bassani’s daughter, Danielle Lominy (formerly Danielle Bassani)

who resides within her residence and are included in Mrs.

Bassani’s beneficial ownership

for purposes of the calculation including:

a) 570,000 shares directly b) 646,458 shares underlying

warrants owned directly;

and c) Danielle Lominy is the 50% beneficiary of the Dominic Bassani

2019 Irrevocable Trust (“2019Trust”) which owns:

i) 3,000,000 warrants to purchase

shares of the Company’s common stock and, as a result, Danielle Lominy is the beneficial

owner of 1,500,000 shares underlying warrants and ii) $459,277.02 principal amount of the

Company’s Adjusted 2020 Convertible Obligation (“CVObligation”) which is

convertible @ $.0953 into 4,819,277 shares and 3,214,458 warrants and, as a result, Danielle

Lominy is the beneficial owner of 2,409,639 shares underlying conversion of the Adjusted

CVObligation and 1,607,229 shares underlying the warrants issuable on conversion of the Adjusted

CVObligation.

Centerpoint Corporation is currently majority owned by the Company.

Under Colorado law, Centerpoint Corporation is not entitled to vote these shares unless otherwise ordered by a court.

These shares of common stock may be distributed to the shareholders of Centerpoint Corporation at a future date pursuant to a dividend declared during July 2004.

The shares distributed to Bion, if any, will be cancelled immediately upon receipt.

Includes 535,221 shares, 1,215,000 shares underlying warrants held directly by Linda Bassani, and 909,747 shares held in IRA accounts.

The total also includes:

a) 747,998 shares of common stock and 498,915 underlying

warrants that could be issued on the conversion (at the election of The Bassani Estate)

of a convertible note in the amount of $373,999, (convertible @ $0.50 price) and b) 273,639

shares of common stock that could be issued on the conversion (at the election of The Bassani

Estate) of a convertible note in the amount of $164,183.00 (convertible @ $0.60 price) and

c) 222,962 shares of common stock that could be issued on the conversion (at the election

of The Bassani Estate) of Adjusted Convertible Note in the amount of $7,906.66 (convertible

@$.115 price) and d) 31,985 shares of common stock that could be issued on the conversion

(at the election of The Bassani Estate) of deferred compensation in the amount of $11,834.15.

Bassani disclaims ownership of 1,511,477 shares underlying warrants held by the Danielle

Christine Bassani Trust, which is separately itemized herein.

Bassani’s adult

daughter Danielle Lominy (formerly Danielle Bassani), who resides within her residence, is

the beneficiary of the Danielle Christine Bassani Trust and Mrs.

Bassani is not one of the

trustees of the trust.

Bassani further disclaims beneficial ownership of shares and

warrants owned by various other family members (including Christopher Parlow who is itemized

separately), none of whom live with her or are her dependents, and such shares are not included

in this calculation.

2,850,422 shares held directly by Mr.

a) 773,354 shares of common stock and 515,827 underlying warrants that could be issued on the conversion (at the election of The Bassani Estate) of a convertible note in the amount of $386,677, (convertible @ $0.50 price) and b) 282,305 shares of common stock that could be issued on the conversion (at the election of The Bassani Estate) of a convertible note in the amount of $169,383 (convertible @ $0.60 price) and c) 68,754 shares of common stock that could be issued on the conversion (at the election of The Bassani Estate) of Adjusted Convertible Note in the amount of $7,906 (convertible @$.115 price) and d) 64,770 shares of common stock that could be issued on the conversion (at the election of The Bassani Estate) of deferred compensation in the amount of $12,306.

Bassani disclaims beneficial ownership of shares and warrants owned by various other family members (including Christopher Parlow and Danielle Lominy who are itemized separately), none of whom live with her or are her dependents, and such shares are not included in this calculation.

(Effective 9/15/2025, Linda Bassani agreed to a settlement along with her children (Danielle Lominy and Christopher Parlow (referred to collectively as “Holders) with the Company.

In consideration of the cancellation of various obligations and security instruments held by the Holders, including without limitation deferred compensation, convertible notes and warrants, the Holders (as a whole) will receive, in aggregate 7,200,000 shares of common stock).

Includes 2,354,822 shares held directly by Mr.

Smith, and 1,626,323 shares held by Mr.

Smith in an IRA.

Also includes 1,626,123 shares held by Mr.

Smith’s wife and 53,756 shares held

in his wife’s IRA.

Also includes 12,681 shares of common stock held by held by LoTayLingKyur

Foundation and 86,754 shares of common stock held by LoTayLingKyur LLC which is controlled

Smith’s wife.

Also includes 12,681 shares of common stock held by held by LoTayLingKyur Foundation and 85,354 shares of common stock held by LoTayLingKyur LLC which is controlled by Mr.

Smith and his wife.

Also includes 242,152 shares and 242,152 warrants underlying units

that could be issued on the conversion by Mr.

Smith of his 2020 Convertible Obligation

in the aggregate amount of $121,075.58.

Smith has the option to convert this amount into

units with each unit consisting of 1 share of common stock and 1 warrant exercisable at $0.75

Also includes 251,838 shares and 251,838 warrants underlying units that could be issued on the conversion by Mr.

Smith of his 2020 Convertible Obligation in the aggregate amount of $125,918 Mr.

Smith has the option to convert this amount into units with each unit consisting of 1 share of common stock and 1 warrant exercisable at $0.75 per share.

The conversion price will be $.50 per unit.

Also includes 244,700 shares

of common stock that could be issued on the conversion (at the election of Mr.

deferred compensation in the amount of $80,751.

Does not include shares and warrants owned

by various other family members of which Mr.

Also includes 441,918 shares of common stock that could be issued on the conversion (at the election of Mr.

Smith) of deferred compensation in the amount of $83,964.

Does not include shares and warrants owned by various other family members of which Mr.

Smith disclaims beneficial ownership.

2,005 shares held directly by Christopher Parlow, 65,000 shares held jointly with wife, 250,000

shares owned by the Christopher Parlow Trust and 50,000 shares owned by Christopher Parlow’s

minor daughters.

Also includes 1,614,000 shares underlying warrants held by the Christopher

Parlow Trust, 147,154 shares underlying warrants held jointly with wife, 150,000 warrants

held directly by Mr.

Smith retired on 7/31/2024.

(Effective 9/15/2025, Mr.

Smith agreed to a settlement with the Company.

In consideration of the cancellation of various obligations and security instruments held by Mr.

Smith including without limitation deferred compensation, convertible notes, and warrants, Mr.

Smith will receive 400,000 shares of common stock).

Includes 2,005 shares held directly by Christopher Parlow, 65,000 shares held jointly with wife, 250,000 shares owned by the Christopher Parlow Trust and 50,000 shares owned by Christopher Parlow’s minor daughters.

Also includes 995,250 shares underlying warrants held by the Christopher Parlow Trust, 147,154 shares underlying warrants held jointly with wife, 150,000 warrants held directly by Mr.

Parlow and 459,780 shares underlying warrants held by Mr.

minor daughters.

In addition, Christopher is the 50% beneficial owner of the Dominic Bassani

2019 Irrevocable Trust (“2019 Trust”) which owns 3,000,000 warrants to purchase

shares of the Company’s common stock and as a result, Christopher Parlow is the

beneficial owner of 1,500,000 shares underlying exercise of the warrants.

Additionally, the

2019 Trust owns $459,277.02 principal amount of the Company’s Adjusted 2020 Convertible

Obligations (“CVObligation”) which is convertible @$.0953 into 4,819,277 shares

and 3,214,458 warrants.

As a result, Christopher Parlow is the beneficial owner of 2,409,639

shares underlying conversion of the CVObligation and 1,607,229 shares underlying the warrants

issuable on conversion of the CVObligation.

170,000 shares held directly by Danielle Lominy (formerly Danielle Bassani), 1,511,477 shares

underlying warrants held by The Danielle Christine Bassani Trust, 400,000 shares owned by

the Danielle Bassani Trust, 311,458 shares underlying warrants, 105,000 shares underlying

warrants owned jointly with husband and 230,000 shares underlying warrants owned by Danielle

Lominy’s minor daughter.

In addition, Danielle is the 50% beneficial owner of the Dominic

Bassani 2019 Irrevocable Trust (“2019 Trust”) which owns 3,000,000 warrants to

purchase shares of the Company’s common stock and, as a result Danielle Lominy is the

beneficial owner of 1,500,000 shares underlying exercise of the warrants.

Additionally, the

2019 Trust owns $459,277.02 principal amount of the Company’s Adjusted 2020 Convertible

Obligation (“CVObligation”) which is convertible @ $.0953 into 4,819,277 shares

and 3,214,458 warrants.

As a result, Danielle Lominy is the beneficial owner of 2,409,639

shares underlying conversion of the CVObligation and 1,607,229 shares underlying the warrants

issuable on conversion of the CVObligation

158,254 shares held directly by Mr.

Schafer, options to purchase 1,215,000 shares and warrants

to purchase 23,934 shares.

Also includes 1,070,021 shares and 535,011 warrants underlying

units that could be issued on the conversion by Mr.

Schafer of his Adjusted Convertible Obligation

in the amount of $101,973.

Schafer has the option to convert this amount into units with

each unit consisting of 1 share of common stock and ½ warrant exercisable at $0.75

Parlow’s minor daughters.

In addition, Christopher is the 50% beneficial owner of the Dominic Bassani 2019 Irrevocable Trust (“2019 Trust”) which owns 3,000,000 warrants to purchase shares of the Company’s common stock and as a result, Christopher Parlow is the beneficial owner of 1,500,000 shares underlying exercise of the warrants.

Additionally, the 2019 Trust owns $459,277 principal amount of the Company’s Adjusted 2020 Convertible Obligations (“CVObligation”) which is convertible @$.0953 into 4,819,277 shares and 3,214,458 warrants.

As a result, Christopher Parlow is the beneficial owner of 2,409,639 shares underlying conversion of the CVObligation and 1,607,229 shares underlying the warrants issuable on conversion of the CVObligation.

(Effective 9/15/2025, Christopher Parlow agreed to a settlement along with his sister Danielle Lominy and mother Linda Bassani (referred to collectively as “Holders) with the Company.

Includes 170,000 shares held directly by Danielle Lominy (formerly Danielle Bassani), 892,727 shares underlying warrants held by The Danielle Christine Bassani Trust, 400,000 shares owned by the Danielle Bassani Trust, 311,458 shares underlying warrants, 105,000 shares underlying warrants owned jointly with husband and 230,000 shares underlying warrants owned by Danielle Lominy’s minor daughter.

In addition, Danielle is the 50% beneficial owner of the Dominic Bassani 2019 Irrevocable Trust (“2019 Trust”) which owns 3,000,000 warrants to purchase shares of the Company’s common stock and, as a result Danielle Lominy is the beneficial owner of 1,500,000 shares underlying exercise of the warrants.

Additionally, the 2019 Trust owns $459,277 principal amount of the Company’s Adjusted 2020 Convertible Obligation (“CVObligation”) which is convertible @ $.0953 into 4,819,277 shares and 3,214,458 warrants.

As a result, Danielle Lominy is the beneficial owner of 2,409,639 shares underlying conversion of the CVObligation and 1,607,229 shares underlying the warrants issuable on conversion of the CVObligation (Effective 9/15/2025, Danielle Lominy agreed to a settlement along with her brother Christopher Parlow and mother Linda Bassani (referred to collectively as “Holders) with the Company.

Includes 158,254 shares held directly by Mr.

Schafer, options to purchase 1,215,000 shares and warrants to purchase 23,934 shares.

Also includes 1,070,021 shares and 535,011 warrants underlying units that could be issued on the conversion by Mr.

Schafer of his Adjusted Convertible Obligation in the amount of $101,973.

Schafer has the option to convert this amount into units with each unit consisting of 1 share of common stock and ½ warrant exercisable at $0.75 per share.

The conversion price is $.0953 per unit.

Also includes 36,918 shares of

common stock that could be issued on the conversion (at the election of Mr.

Schafer) by Mr.

Schafer of his Adjusted September 2015 convertible note in the amount of $4,245.47.

The conversion

price will be $.115 per share.

700,000 shares held directly by Mr.

Schafer retired from the Board of Directors on 12/31/2024.

(Effective 9/15/2025, Mr.

Schafer agreed to a settlement with the Company.

In consideration of the cancellation of various obligations and security instruments held by Mr.

Schafer, including without limitation, convertible notes, warrants and options, Mr.

Schafer will receive 501,746 shares of common stock).

Includes 700,000 shares held directly by Mr.

Schoener and warrants to purchase 300,000 shares.

400,000 shares held directly by Mr.

of August 1, 2024, Mr.

Stovall does not own any Bion Securities.

(10) Includes

478,444 shares held directly by Mr.

Scott, 4,000 shares held by his spouse, 1,545,000 shares

underlying options and 573,747 shares underlying warrants held directly by Mr.

also includes 508,457 shares of common stock that could be issued on the conversion (at the

election of Mr.

Schoener is a 20% owner of a convertible promissory note in the principal amount of $500,000.

The note is secured by the Company’s Intellectual Property (IP/Patents).

This note is not included in Mr.

Schoener’s beneficial ownership calculations

Includes 400,000 shares held directly by Mr.

Weerts is a 20% owner of a convertible promissory note in the principal amount of $500,000.

The note is secured by the Company’s Intellectual Property (IP)/Patents.

This note is not included in Mr.

Weerts’ beneficial ownership calculations

Includes 478,444 shares held directly by Mr.

Scott, 4,000 shares held by his spouse, 1,545,000 shares underlying options and 573,747 shares underlying warrants held directly by Mr.

This also includes 1,737,085 shares of common stock that could be issued on the conversion (at the election of Mr.

Scott) of deferred compensation in the amount of $330,046.

(11) Includes

120,635 shares held directly by Mr.

Northrop and options to purchase 517,500 shares held

Scott’s spouse is the owner of a convertible promissory note in the principal amount of $25,000.

The note is secured by the Company’s intellectual property (IP)/Patents.

This note is not included in Mr.

Scott’s beneficial ownership calculations.

Includes 118,635 shares held directly by Mr.

Northrop and options to purchase 517,500 shares held by Mr.

Does not include shares or options owned by the adult children of Mr.

nor his former wife.

(12) Includes

105,112 shares of common stock and 50,000 shares of common stock underlying options held

directly by Mr.

(13) Includes

50,000 shares of common stock underlying options and 75,000 shares of common stock underlying

warrants held directly by Mr.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS,

AND DIRECTOR INDEPENDENCE.

Other than the employment/consulting agreements, deferred

compensation arrangements and conversions of debt described above in Item 1 Business and Item 11 Executive Compensation, there are no

related party transactions.

Four directors of the Company (Jon Northrop, Ed Schaefer,

Salvatore Zizza and William Rupp) are considered to be independent directors.

Northrop nor his former wife.

Includes 105,112 shares of common stock and 50,000 shares of common stock underlying options held directly by Mr.

Includes 357,178 shares held directly by Mr.

Posner and 150,900 held in IRA Accounts.

Also includes 25,000 shares underlying warrants.

Posner is the owner of a convertible promissory note in the principal amount of $25,000.

The note is secured by the Company’s intellectual property (IP)/Patents.

This note is not included in Mr.

Posner’s beneficial ownership calculations.

CERTAIN RELATIONSHIPS AND RELATED

TRANSACTIONS, AND DIRECTOR INDEPENDENCE.

Other than the employment/consulting agreements,

deferred compensation arrangements and conversions of debt described above in Item 1 Business and Item 11 Executive Compensation, there

are no related party transactions.

Four directors of the Company (Jon Northrop, Salvatore

Zizza, Stephen Posner, and Bob Weertz) are considered to be independent directors.

PRINCIPAL ACCOUNTING FEES AND SERVICES.

In January 2017 the Company engaged Eide Bailly LLP

as its independent registered public accounting firm.

The aggregate fees billed for the fiscal year ended June 30, 2023 by Eide Bailly

LLP for professional services rendered for the audit of the Company's annual financial statements and reviews of interim financial statements

included in the Company's quarterly reports on Form 10-Q (and related matters) were $54,325.

In December 2022 the Company engaged Haynie &

Company as its independent registered public accounting firm.

The aggregate fees billed for the fiscal year ended June 30, 2023 by Haynie

& Company for professional services rendered for the audit of the Company’s annual financial statements and reviews of the interim

financial statements included in the Company’s quarterly reports on Form 10-Q (and related matters) were $71,000.

The aggregate fees billed for the fiscal year ended

June 30, 2024 by Haynie & Company for professional services rendered for the audit of the Company’s annual financial statements

and reviews of the interim financial statements included in the Company’s quarterly reports on Form 10-Q (and related matters)

were $83,000.

The aggregate fees billed for the fiscal year

ended June 30, 2024 by Haynie & Company for professional services rendered for the audit of the Company’s annual financial statements

and reviews of the interim financial statements included in the Company’s quarterly reports on Form 10-Q (and related matters) were

The aggregate fees billed for the fiscal year

ended June 30, 2025 by Haynie & Company for professional services rendered for the audit of the Company’s annual financial statements

and reviews of the interim financial statements included in the Company’s quarterly reports on Form 10-Q (and related matters) were

Audit Related Fees

There were no fees billed by Eide Bailly LLP for audit-related

fees in each of the last two fiscal years ended June 30, 2023.

There were no fees billed by Haynie & Company

for audit-related fees in the last fiscal year ended June 30, 2025.

The aggregate fees billed for tax services rendered by Eide Bailly LLP

for tax compliance and related services for the fiscal year ended June 30, 2023 was nil.

The aggregate fees billed for tax services rendered

by Haynie & Company for tax compliance and related services for the year ended June 30, 2024 was $18,000.

by Haynie & Company for tax compliance and related services for the year ended June 30, 2025 was nil.

All Other Fees

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Under provisions of the Sarbanes-Oxley Act of

the Company's principal accountant may not be engaged to provide non-audit services that are prohibited by law or regulation to be provided

by it, and the Board of directors (which serves as the Company's audit committee) must pre-approve the engagement of the Company's principal

accountant to provide audit and permissible non-audit services.

The Company's Board has not established any policies or procedures other

than those required by applicable laws and regulations.

2002, the Company's principal accountant may not be engaged to provide non-audit services that are prohibited by law or regulation to

be provided by it, and the Board of directors (which serves as the Company's audit committee) must pre-approve the engagement of the Company's

principal accountant to provide audit and permissible non-audit services.

The Company's Board has not established any policies or procedures

other than those required by applicable laws and regulations.

EXHIBITS, FINANCIAL STATEMENT SCHEDULES

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(Incorporated by reference to Exhibit 10.25 filed with Form 10SB12G on November 14, 2006).

Employment agreement with Jeff Kapell (Incorporated by reference to Exhibit 10.26 filed with Form 10SB12G on November 14, 2006).

Employment agreement with Jeremy Rowland (Incorporated by reference to Exhibit 10.27 filed with Form 10SB12G on November 14, 2006).

Office lease at 641 Lexington Avenue, 17th Floor, New York (Incorporated by reference to Exhibit 10.28 filed with Form 10SB12G on November 14, 2006).

2006 Consolidated Incentive Plan (Incorporated by reference to Exhibit 10.29 filed with Form 10SB12G on November 14, 2006).

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Smith dated May 31, 2008 (Incorporated by reference to Exhibit 99.3 filed with Form 8-K filed on June 3, 2008).

2007 Series AB Convertible Promissory Note (Incorporated by reference to Exhibit 99.1 filed with Form 8-K filed on June 19, 2008).

Promissory Note between Bion Environmental Technologies, Inc.

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Orphanos Extension Agreement dated January 13, 2009 (Incorporated by reference to Exhibit 10.3 filed with Form 8-K filed on January 15, 2009).

Lease Agreement between Ronald Kreider and Kreider Farms and Bion PA 1 LLC dated June 26, 2009 (Incorporated by reference to Exhibit 10.1 filed with Form 8-K filed on July 2, 2009).

Capitalization Agreement between Bion Companies and Bion PA 1 LLC dated June 30, 2009 (Incorporated by reference to Exhibit 10.2 filed with Form 8-K filed on July 2, 2009).

Extension Agreement with Mark A.

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Agreement with Edward Schafer (Incorporated by reference to Exhibit 10.2 filed with Form 8-K filed on August 18, 2010).

Accepted Funding Offer (base loan agreement) (without exhibits) with PENNVEST for Kreider Farms Project Loan -- effective November 3, 2010 (Incorporated by reference to Exhibit 10.1 filed with Form 8-K filed on November 3, 2010).

Short Form Agreement (Incorporated by reference to Exhibit 10.1 filed with Form 8-K filed on November 22, 2010).

Resume of William O’Neill.

(Incorporated by reference to Exhibit 10.2 filed with Form 8-K filed on November 22, 2010).

Loan & Security Agreement with Milestone Bank (Incorporated by reference to Exhibit 10.2 filed with Form 8-K filed on December 6, 2010).

O'Neill Employment Agreement (dated December 22, 2010) (Incorporated by reference to Exhibit 10.1 filed with Form 8-K filed on December 6, 2010).

Schafer Employment Agreement (dated December 21, 2010) (Incorporated by reference to Exhibit 10.2 filed with Form 8-K filed on December 6, 2010).

2 unchanged sentences

Kreider Farms Clarification Agreement (Incorporated by reference to Exhibit 10.3 filed with Form 8-K filed on March 16, 2011).

Resignation of William O’Neill (effective May 13, 2011) (Incorporated by reference to Exhibit 10.1 filed with Form 8-K filed on May 13, 2011).

PADEP Certification of Kreider Poultry Credits (Incorporated by reference to Exhibit 10.1 filed with Form 8-K filed on June 1, 2011).

9 unchanged sentences

Demand Promissory Note dated May 13, 2013 (Incorporated by reference to Exhibit 10.2 filed with Form 10-Q filed on May 14, 2013).

Pennvest Demand Letter (dated September 25, 2014) (Incorporated by reference to Exhibit 10.92 filed with Form 10-K filed on September 26, 2014).

Extension Agreement with Mark A.

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on August 29, 2024).

Dilling Group Summons

(Incorporated by reference to Exhibit 99.1 filed with Form 8-K filed on April 7, 2025).

Hamstra Builders Summons

(Incorporated by reference to Exhibit 99.1 filed with Form 8-K filed on April 17, 2025).

Perfect Blend LOI (Incorporated

by reference to Exhibit 10.1 filed with Form 8-K filed on May 30, 2025).

RMG LOI (Incorporated by reference to Exhibit 10.2 filed with Form 8-K filed on May 30, 2025).

BLG Forbearance Agreement

(Incorporated by reference to Exhibit 10.3 filed with Form 8-K filed on May 30, 2025).

BLG Second Forbearance

Agreement (Incorporated by reference to Exhibit 10.1 filed with Form 8-K filed on July 24, 2025).

BLG Promissory Note (Incorporated by reference to Exhibit 10.2 filed with Form 8-K filed on July 24, 2025).

BLG Security Agreement

(Incorporated by reference to Exhibit 10.3 filed with Form 8-K filed on July 24, 2025).

Insider Trading Policy

Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002- Filed herewith electronically.

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and shall not be deemed incorporated by reference into any filing, in accordance with Item 601 of Regulation S-K.

BION ENVIRONMENTAL TECHNOLOGIES,

AND SUBSIDIARIES

Report of Independent Registered Public Accounting Firm ( Haynie & Company , PCAOB ID:

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Opinion on the Financial Statements

We have audited the accompanying consolidated balance

sheets of Bion Environmental Technologies, Inc.

(the Company) as of June 30, 2024 and 2023 and the related consolidated statements of

operations, changes in stockholders’ equity (deficit), and cash flows for each of the years in the two-year period ended June 30,

We have audited the accompanying consolidated

balance sheets of Bion Environmental Technologies, Inc.

(the Company) as of June 30, 2025 and 2024, and the related consolidated statements

of operations, changes in stockholders’ equity (deficit), and cash flows for each of the years in the two-year period ended June

30, 2025, and the related notes (collectively referred to as the financial statements).

In our opinion, the financial statements present fairly,

in all material respects, the financial position of the Company as of June 30, 2024 and 2023, and the results of its operations and its

cash flows for each of the years in the two-year period ended June 30, 2024, in conformity with accounting principles generally accepted

in the United States of America.

In our opinion, the financial statements present

fairly, in all material respects, the financial position of the Company as of June 30, 2025 and 2024, and the results of its operations

and its cash flows for each of the years in the two-year period ended June 30, 2025, in conformity with accounting principles generally

accepted in the United States of America.

Going Concern

The accompanying financial statements have been prepared

assuming that the Company will continue as a going concern.

As discussed in Note 1 to the financial statements, the Company has yet to

generate any revenue and has suffered recurring losses from operations.

These factors raise substantial doubt about its ability to continue

as a going concern.

The accompanying financial statements have been

prepared assuming that the Company will continue as a going concern.

As discussed in Note 1 to the financial statements, the Company has

yet to generate any revenue and has suffered recurring losses from operations.

These factors raise substantial doubt about its ability

to continue as a going concern.

Management’s plans in regard to these matters are also discussed in Note 1.

The financial statements do not

include any adjustments that might result from the outcome of this uncertainty.

The financial statements

do not include any adjustments that might result from the outcome of this uncertainty.

Basis for Opinion

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regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards

of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements

are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were we engaged to perform,

an audit of its internal control over financial reporting.

As part of our audits, we are required to obtain an understanding of internal

control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal

control over financial reporting.

We conducted our audits in accordance with the

standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial

statements are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were we engaged

to perform, an audit of its internal control over financial reporting.

As part of our audits, we are required to obtain an understanding

of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s

internal control over financial reporting.

Accordingly, we express no such opinion.

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Critical Audit Matters

The critical audit matter communicated below is a

matter arising from the current period audit of the financial statements that were communicated or required to be communicated to the

audit committee and that:

(1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially

challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the

financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions

The critical audit matters communicated below

are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to

the audit committee and that:

(1) relate to accounts or disclosures that are material to the financial statements and (2) involved our

especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion

on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions

on the critical audit matters or on the accounts or disclosures to which they relate.

Equity Transactions

Equity Transactions and Convertible Debt

As discussed in Note 5 and Note 6 to the financial

2 unchanged sentences

These agreements require management to estimate the value of options and warrants

issued for services on the measurement date or include complicated calculations when debt is converted to equity.

issued for services on the measurement date, constituting a significant management estimate subject to possible management bias, or include

complicated calculations when debt is converted to equity, which requires significant knowledge for evaluation.

During the year ended

June 30, 2024, the Company recorded stock-based compensation expense (including options, warrants, and units issued to employees and for

services) of $85,994, warrant modifications of $150,206, and a $140,941 of debt converted to common stock.

June 30, 2025, the Company recorded interest expense related to the modification of warrants in the amount of $180,930, and modification

expense related to the extension of options and warrants of $332,128 and $511,410, respectively.

Our audit procedures required a significant amount

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September 29, 2025

BION ENVIRONMENTAL TECHNOLOGIES, INC.

ENVIRONMENTAL TECHNOLOGIES, INC.

AND SUBSIDIARIES

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Convertible notes payable - affiliates (Note 5)

Convertible note payable (Note 5)

Convertible bridge note payable (Note 5)

Note payable - related party (Note 5)

Operating lease liability, current (Note 8)

Total current liabilities

Operating lease liability, long term (Note 8)

Convertible notes payable (Note 5)

Convertible notes payable - affiliates (Note 5)

Total liabilities

Equity (deficit):

Bion's stockholders' equity (deficit):

Series A Preferred stock, $ 0.01 par value, 50,000 shares authorized,

no shares issued and outstanding

Series C Convertible Preferred stock, $ 0.01 par value,

60,000 shares authorized;

no shares issued and outstanding

Common stock, no par value, 250,000,000 shares authorized,

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( 7,134,758 )

( 5,808,501 )

Noncontrolling interest

1 unchanged sentence

( 7,097,185 )

( 5,770,928 )

Total liabilities and (deficit)

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Interest income

(Gain) on disposal of assets

Gain (loss) on disposal of assets

Interest expense

Loss on asset impairment

Gain on debt forgiveness

Loss on Impairment

Total other expense

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AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT)

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS'

EQUITY (DEFICIT)

YEARS ENDED JUNE 30, 2025 AND 2024

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Series C Preferred Stock

Additional paid-in

Subscription Receivables for

Noncontrolling

paid-in capital

equity/(deficit)

Balances, July 1, 2022

$ ( 504,650 )

Balances, June 30, 2023

$ ( 504,650 )

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Sale of units

Sale of common stock

Warrants exercised for common shares

Warrants exercised under cashless exercise

Options exercised under cashless exercise

Issuance of units for services

Issuance of warrants for services

Conversion of debt and liabilities

Vesting of options for employees and services

Commissions on sale of units

Modification of warrants - non-cash comp

Modification of warrants - interest

Vesting of warrants for employees and services

Debt modification

Giveback of convertible liabilities and debt from affiliates

Conversion of debt and liabilities

Modification of warrants

Commission on sale of units

( 11,691,115 )

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$ ( 138,927,778 )

Sale of units

Warrants exercised for common shares

Warrants exercised under cashless exercise

Options exercised under cashless exercise

$ ( 5,770,928 )

Issuance of units for services

Issuance of warrants for services

Vesting of options for employees and services

Vesting of warrants for employees and services

Debt Modification

Giveback of convertible liabilities and debt from affiliates

Conversion of debt and liabilities

Modification of warrants

Commissions on sale of units

Modification of options

Commission on the sales of units

( 2,379,924 )

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Stock-based compensation for services

Modification of warrants

Warrants issued for compensation for services

Decrease in prepaid expenses

(Decrease) in deposits in other assets

Increase (decrease) in accounts payable and accrued expenses

Decrease (increase) in operating lease assets and liabilities

Forgiveness of debt

Increase (decrease) in prepaid expenses

Increase in accounts payable and accrued expenses

(Increase) decrease in operating lease assets and liabilities

Increase in deferred compensation

Net cash used in operating activities

( 2,928,584 )

CASH FLOWS FROM INVESTING ACTIVITIES

Purchase of property and equipment

( 3,557,059 )

Disposal of property and equipment

Net cash used in investing activities

( 3,557,059 )

CASH FLOWS FROM FINANCING ACTIVITIES

Proceeds from sale of units

Proceeds from sale of warrants

Commissions on sale of warrants

Proceeds from convertible bridge loan

Proceeds from convertible notes loan

Commission on the sale of units and convertible debt

Proceeds from convertible loan

Proceeds from note payable loan - related party

Proceeds from convertible bridge note payable

Proceeds from exercise of warrants

1 unchanged sentence

Net decrease in cash

( 2,534,478 )

Cash at beginning of year

3 unchanged sentences

Non-cash investing and financing transactions:

Adjustment for debt modification

Adjustment for debt modification from giveback agreements

1 unchanged sentence

Conversion of debt and liabilities into common units

Conversion of debt and liabilities into notes payable

Conversion of deferred compensation to notes payable

6 unchanged sentences

YEARS ENDED JUNE 30, 2025 AND 2024

AND ORGANIZATION :

BUSINESS AND ORGANIZATION :

Nature of Operations

1 unchanged sentence

"Company," "We," "Us," or "Our") was incorporated in 1987 in the State of Colorado.

Our patented and proprietary technology was developed

to provide advanced waste treatment and resource recovery for large-scale livestock production facilities (also known as “Concentrated

Animal Feeding Operations” or “CAFOs").

Our Gen3Tech can largely mitigate the environmental problems of CAFOs, while

simultaneously improving operational/ resource efficiencies by recovering high-value co-products from the waste stream, including renewable

energy and nutrients.

Bion is focused on the ‘feeder’ space of the livestock production/value chain, primarily in the beef

industry because we believe it faces the most challenges of all the livestock sectors and can benefit the most from the application of

Bion’s technology and business strategy.

We believe that the best opportunity for the Company

to prove its sustainable beef concept at this time is with the Stovall Ranch JV in Montana.

In June 2024, Bion formed a strategic relationship

with Turk Stovall and Stovall Ranching Companies.

Bion and Stovall have agreed to establish a JV, to be led by Mr.

Stovall, with the goal

of developing a 15,000-head sustainable beef project at Stovall’s Yellowstone Cattle Feeders (‘YCF’) location in Shepherd,

We anticipate establishing the Stovall-Bion JV and creating related distribution agreements with key value chain partners during

the current calendar year, with the intent to begin construction before the end of 2024.

Advancing the Stovall-Bion JV project is our

primary focus, although we are also expending resources evaluating our ARS as a standalone ammonia control solution.

Our patented and proprietary

technology was developed to provide advanced waste treatment and resource recovery for large-scale livestock production facilities (also

known as “Concentrated Animal Feeding Operations” or “CAFOs").

Our Gen3Tech can largely mitigate the environmental

problems of CAFOs, while simultaneously improving operational/ resource efficiencies by recovering high-value co-products from the waste

stream, including renewable energy, nutrients, and clean water.

For the last several years, Bion was focused on the beef industry because

we believe it faces the most challenges of all the livestock sectors and can benefit the most from the application of Bion’s technology

and business strategy.

Until recently, we believed

that the best opportunity for the Company to prove its technology, along with the sustainable beef concept, was with the Stovall Ranch,

In June 2024, Bion formed a strategic relationship with Turk Stovall and Stovall Ranching Companies.

Bion and Stovall agreed

to establish a JV, to be led by Mr.

Stovall, with the goal of developing a 16,000-head sustainable beef project at Stovall’s Yellowstone

Cattle Feeders (‘YCF’) location in Shepherd, Montana.

We anticipated establishing the Stovall-Bion JV and creating related

distribution agreements with key value chain partners, with the intent to begin construction in the first quarter of 2025.

to several factors, including 1) the extended development timeline to reach revenues at Stovall (which could be at least two years or

more), 2) a need to both prove our technology at full-scale as quickly as possible, and 3) enter the fertilizer markets with product in

the 2026 growing season, at the end of calendar 2024 we shifted our focus to smaller ‘bolt-on’ opportunities in both the animal

waste and industrial sectors that we think can be developed more quickly.

Bion’s patents were

expanded in 2024 to include industrial and municipal wastewater sources, in addition to animal waste streams that were previously covered.

To that end, Bion has directed most of its limited resources to pursuing opportunities to

apply its Ammonia Recovery System (ARS) as a bolt-on or ‘standalone’ ammonia control solution in the industrial sector.

such cases, the ARS would be deployed as an ammonia control solution (vs integrated into a Bion Gen3Tech livestock platform) for facilities

(both new and existing) that produce biogas from organic waste streams, such as food, food processing, and livestock packing/slaughter.

These facilities are subject to EPA-mandated discharge limits that require ammonia control or face other limitations on ammonia/nitrogen

in the effluent from biogas production.

We will also seek to identify opportunities to provide ammonia control solutions in the livestock/animal

waste at existing farms with anaerobic digesters already in place (which will also shorten the development timeline).

While we have not

abandoned developing new integrated livestock projects with our Gen3tech platform, we believe there is a robust opportunity to provide

bolt-on ammonia control solutions to the operators of their own biogas projects, and we are now devoting almost all of our resources to

developing this opportunity.

Going Concern

12 unchanged sentences

raises substantial doubt about the Company’s ability to continue as a going concern.

During the year ended June 30, 2024, a one-time, non-recurring, non-cash

charge of $ 9,460,425 was incurred by the Company in connection with a write-down of the capitalized carrying value of the Initial Project

(at Fair Oaks, Indiana) because the Initial Project was recently reclassified as largely a research & development facility and is

located on land subject to a short term lease (as described above in Item 7, Management’s Discussion and Analysis).

reduced the Company shareholders’ equity to ($ 5,808,501 ) and resulted in a loss of $ 11,691,115 for the 2024 fiscal year.

liabilities were approximately $ 5.8 million and $ 1.6 million at June 30, 2024 and 2023, respectively, the increase of approximately $ 4.2

million was largely due to an increase in ‘accounts payable and accrued expenses’ and debt moving from long term to current

Similarly, the Company’s cash on hand decreased from approximately $ 626,000 to approximately $ 52,000 over the same

The Company’s extreme difficulty in obtaining needed funds during the entire 2024 fiscal year has continued throughout the

first quarter of the current fiscal year to date.

Going Concern and Management’s Plans, Plan of Operations and Outlook

Management's Discussion and Analysis of Financial Condition and Results of Operations and Note 11 Subsequent Events.

The constraints on available resources have had, and continue to have,

negative effects on the pace and scope of the Company’s efforts to operate and develop its business.

The Company has had to delay

payment of trade obligations and has had to economize in many ways that have potentially negative consequences.

If the Company is able

to raise needed funds during the remainder of the current fiscal year (and subsequent periods), of which there is no assurance, management

will not need to consider deeper cuts (including additional personnel cuts) and/or curtailment of ongoing activities including research

and development activities.

The Company will need to obtain additional capital to fund its operations and technology development, to satisfy

existing creditors, to develop Projects.

The Company anticipates that it will seek to raise from $ 20,000,000 to $ 80,000,000 or more debt

and/or equity through joint ventures, strategic partnerships and/or sale of its equity securities (common, preferred and/or hybrid) and/or

debt (including convertible) securities, and/or through use of ‘rights’ and/or warrants (new and/or existing) and/or through

other means during the next twelve months.

However, as discussed above, there is no assurance, especially in light of the difficulties

the Company has experienced in many recent years and the extremely unsettled capital markets that presently exist for small pre-revenue

companies like us, that the Company will be able to obtain the funds that it needs to stay in business, complete its technology development

or to successfully develop its business and Projects.

Ultimately, in the event the Company cannot secure additional financial resources,

or complete a strategic transaction in the longer term, the Company may need to curtail or suspend its operational plans or current initiatives,

or potentially liquidate its business interests, and investors may lose all or part of their investment.

During the year ended June 30, 2025 the Company

had a loss of $ 2,380,000 including $ 844,000 non-cash compensation expenses related to extension of warrants and options.

During the year ended June

30, 2024, a one-time, non-recurring, non-cash charge of $ 9,460,425 was incurred by the Company in connection with a write-down of the

capitalized carrying value of the Initial Project (at Fair Oaks, Indiana) because the Initial Project was recently reclassified as largely

a research & development facility and is located on land subject to a short term lease (as described above in Item 7, Management’s

Discussion and Analysis).

This charge reduced the Company shareholders’ equity to ($ 5,808,501 ) and resulted in a loss of $ 11,691,115

for the 2024 fiscal year.

BION ENVIRONMENTAL TECHNOLOGIES, INC.

2 unchanged sentences

YEARS ENDED JUNE 30, 2025 AND 2024

The accompanying consolidated financial statements do not include any adjustments

relating to the recoverability or classification of assets or the amounts and classification of liabilities that may result should the

Company be unable to continue as a going concern.

The following paragraphs describe management’s plans with regard to these conditions.

The constraints on available

resources have had, and continue to have, negative effects on the pace and scope of the Company’s efforts to operate and develop

its business.

The Company has had to delay payment of trade obligations and has had to economize in many ways that have potentially negative

consequences.

If the Company is able to raise needed funds during the subsequent fiscal year, of which there is no assurance, management

will not need to consider deeper cuts (including additional personnel cuts) and/or curtailment of ongoing activities including research

and development activities.

The Company will need to obtain additional capital to fund its operations and technology development, to satisfy

existing creditors, and to develop Projects.

The Company anticipates that it may seek to raise from $ 3,000,000 to $ 10,000,000 or more

debt and/or equity through sale of its equity securities (common, preferred and/or hybrid) and/or debt (including convertible) securities,

and/or through use of ‘rights’ and/or warrants (new and/or existing) and/or license payments and/or through other means during

the next twelve months.

Further, Bion may be required to fund $15 million (or more) in project finance for the initial ARS project, in

a combination of debt financing and equity investment.

However, as discussed above, there is no assurance, especially in light of the

difficulties the Company has experienced in many recent years and the extremely unsettled capital markets that presently exist for small

pre- revenue companies like us, that the Company will be able to obtain the funds that it needs to stay in business, complete its technology

development or to successfully develop its business and Projects.

Ultimately, in the event the Company cannot secure additional financial

resources, or complete a strategic transaction in the longer term, the Company may need to curtail or suspend its operational plans or

current initiatives, or potentially liquidate its business interests, and investors may lose all or part of their investment.

The accompanying consolidated financial statements do not include any

adjustments relating to the recoverability or classification of assets or the amounts and classification of liabilities that may result

should the Company be unable to continue as a going concern.

The following paragraphs describe management’s plans with regard to

these conditions.

Management’s Plan

To help alleviate short-term cash needs and continue current operations,

three affiliates of the Company (Greg Schoener, Interim COO & Director;

Turk Stovall, Director;

Bob Weerts, Director) and two shareholders

(one of whom is the brother of Greg Schoener) have agreed to advance to the Company, through a newly formed LLC, up to $ 500,000 in consideration

of a secured convertible promissory note.

It is anticipated that additional investors will join the LLC, and that the funds available

to Bion will increase, although there can be no assurance they will.

The note instrument and agreements have not been executed at this

time because terms and other details have not been finalized yet;

however, the group has begun advancing money to the Company.

date of the filing of this report, the aggregate sum of $ 201,564 has been advanced to the

Company, together with express directions on what items were to be paid with such funds.

When a final agreement is executed, it will be

attached as an exhibit to a Form 8-K.

To date, the Company has primarily raised funds through private placements

with accredited investors, often conducted through FINRA-registered broker/dealers.

However, the Company anticipates, moving forward,

it will need to raise capital using a combination of financial instruments and sources, that could also include strategic and/or institutional

investors, including family offices and private equity, brokered equity or debt offerings with both public and private investors, and

banks and other ag lending institutions, among others, although there can be no assurance it will be successful.

Many of these financing

options may involve dilution, potentially substantial, for current shareholders.

Management intends to augment its access to capital by

adding one or more staff members (or consultants) with experience in the capital markets, as well as utilizing its current contacts and

relationships in the capital markets.

Bion is currently in discussions with several potential strategic partners

in renewable energy – RNG and solar – and clean fuels, as well as reducing the carbon footprint of livestock production, especially

Some of these candidates have expressed an interest in investing in Bion and JV projects, and management believes that Bion will

receive an investment from such a partner (as well as from other strategic partners from other parts of the value chain), although there

can be no assurance that it will.

Bion is now evaluating both European and U.S.

renewable energy/ clean fuels developers, operators, and

investors to determine the best fit for moving forward with AD/RNG development for its own beef project(s), access to clean fuels value

chains for its low-carbon fertilizers, animal waste treatment for others, both here and in the EU, as well as a development partner in

industrial and municipal opportunities.

Bion believes that such a relationship would entail a direct investment in Bion, licensing fee,

or some other ‘up front’ financial benefit to Bion.

The Company continues to explore sources of additional financing to satisfy

its current operating requirements and future growth needs.

The Company has faced substantial demand for capital and operating expenditures

for the fiscal year 2024 that we anticipate will increase during the 2025 fiscal year and periods thereafter as we move toward commercial

implementation of our 3G Tech and development of JVs (including costs associated with additions of personnel to carry out the business

activities of the Company).

As a result, the Company has faced, and continues to face, significant cash flow management challenges due

to material working capital constraints.

To partially mitigate these working capital constraints, the Company's core senior management

and some key employees and consultants have been deferring most of their cash compensation and/or are accepting compensation in the form

of securities of the Company and members of the Company's senior management have from time-to-time made loans to the Company in the past

and may do so in future periods.

The Company continues to explore

sources of financing to satisfy its current operating requirements and future growth needs.

The Company faced substantial demand for capital

and operating expenditures during fiscal year 2025, which we expect to increase for the periods thereafter as we move toward commercial

implementation of our ARS (including costs associated with additions of personnel to carry out the business activities of the Company).

As a result, the Company has faced, and continues to face, significant cash flow management challenges due to material working capital

To partially mitigate these working capital constraints, the Company's core senior management and some key employees and

consultants have been deferring most of their cash compensation and/or are accepting compensation in the form of securities of the Company

and members of the Company's senior management have from time-to-time made loans to the Company in the past and may do so in future periods.

To help alleviate short-term cash needs for continued

operations, three affiliates of the Company (Greg Schoener, Interim COO & Director;

operations, in August, three affiliates of the Company (Greg Schoener, Interim COO & Director;

Turk Stovall, Director;

Bob Weerts, Director)

and two shareholders (one of whom is the brother of Greg Schoener) have agreed to advance to the Company, through a newly formed LLC,

up to $ 500,000 in consideration of a secured convertible promissory note.

It is anticipated that others will join the LLC, although there

can be no assurance they will.

The note instrument and agreements have not been executed at this time because terms and other details

have not been finalized yet;

however, the group has begun advancing money to the Company.

As of the date of the filing of this report,

the aggregate sum of $ 201,564 has been advanced to the Company, together with express directions

on what items were to be paid with such funds.

When a final agreement is executed, it will be attached as an exhibit to a Form 8-K.

THERE IS NO ASSURANCE THAT THE COMPANY WILL REACH

OR APPROACH THE GOALS/TARGETS SET FORTH ABOVE.

REACHING SUCH GOALS/TARGETS WILL REQUIRE RESOLUTION OF THE COMPANY’S EXISTING FINANCIAL

DIFFICULTIES AND ACCESS TO VERY LARGE AMOUNTS OF CAPITAL (EQUITY AND DEBT) AS EACH BEEF PROJECT MODULE IS PROJECTED TO COST IN EXCESS

OF $50 MILLION (DEBT/EQUITY/GRANTS) TO CONSTRUCT AND WILL REQUIRE MOBILIZATION OF SUBSTANTIAL PERSONNEL, TECHNICAL RESOURCES AND MANAGEMENT

THE COMPANY DOES NOT POSSESS EITHER THE FINANCIAL OR PERSONNEL RESOURCES INTERNALLY AND WILL NEED TO SOURCE SUCH RESOURCES FROM

OUTSIDE ITSELF.

Director) and two shareholders (one of whom is the brother of Greg Schoener) began advancing money to Bion to cover critical payables.

They subsequently formed a loan group, BION BLG, LLC (“BLG”), and have continued to provide short-term funding for Bion in

a secured promissory note of up to $ 500,000 .

Schoener, Weerts, and the two non-affiliate members were also large Bion shareholders, prior

to the formation of BLG.

As a group, Schoener, Stovall, and Weerts own 60% of BLG, which has a security interest in the Company’s

Intellectual Property.

The BLG note will bear interest at a rate of 7.5 % per annum and the maturity date is April 15, 2025, see further

details in subsequent events.

As of the filing date, BLG has advanced 407,384 .

The BLG note will convert into Units (shares and/or warrants)

in the Company at the terms of a later capital raise, in which Bion crosses the threshold of $3 (three) million in aggregate capital raised

(or other source of funding, and other terms as defined in the note).

If the Company is unable to complete such funding within six (6)

months, it will be in default of the BLG note, which is secured by the Company’s Intellectual Property (“IP” “Collateral”).

BLG will share the Collateral on a pro rata basis with investors in a secured promissory note with similar terms being offered to previous

Bion investors.

The BLG note and security agreements contain other terms set forth therein and are included as exhibits to this filing.

BION ENVIRONMENTAL TECHNOLOGIES, INC.

2 unchanged sentences

YEARS ENDED JUNE 30, 2025 AND 2024

November 2024, the Company launched a series of secured promissory note offerings to previous investors/shareholders (and certain others)(Shareholder

Notes) with similar terms to the BLG note.

Based on feedback from shareholders and registered representatives with which the Company has

long standing relationships, management believed at that time that sufficient capital could be raised with this group to 1) continue to

cover critical payables to maintain operations that will allow the Company to finish the engineering report and technology demonstration

at Fair Oaks, 2) move forward with pre-development work on the Stovall project, 3) continue discussions with potential strategic partners,

and 4) position ourselves for the larger offering/ funding that will be required.

As of the filing date, Bion has raised $611,000

in the Shareholder Note offerings.

Further, Bion has changed

its focus from pre-development work on the Stovall project, to an initial bolt-on project at an existing facility.

To date, the Company has primarily

raised funds through private placements with accredited investors, often conducted through FINRA-registered broker/dealers.

Company anticipates moving forward, it will need to raise capital using a combination of financial instruments and sources, that could

also include strategic and/or institutional investors, including family offices and private equity, brokered equity or debt offerings

with both public and private investors, and banks and other ag lending institutions, among others, although there can be no assurance

it will be successful.

Many of these financing options may involve dilution, potentially substantial, for current shareholders.

intends to augment its access to capital by adding one or more staff members (or consultants) with experience in the capital markets,

as well as utilizing its current contacts and relationships in the capital markets.

Bion is currently in discussions

with several potential strategic partners in engineering, renewable energy (biogas/RNG) and clean fuels, organic fertilizer distribution,

and others involved in reducing the environmental footprint of biogas and livestock production.

With today’s U.S, and global emphasis

on decarbonizing energy and the food supply chain, and their impacts on water and air pollution, the sectors have become closely intertwined.

They are evolving quickly, and integrated solutions have become increasingly desired, but complex.

Bion is now evaluating engineering

and construction firms, biogas operators, and others as potential development partners for industrial and livestock opportunities.

with the recent OMRI Listing for its commercial fertilizer, the Company has initiated discussions with several large U.S.

fertilizer manufacturers

and distributors that have expressed interest in the product.

Bion believes that such relationships could entail a direct investment in

Bion, licensing fee, or some other ‘up front’ financial benefit to Bion, although there is no assurance that they will.

Company recently finished data acquisition at Fair Oaks needed to complete an independent engineering report that is critical to demonstrating

the technology performance and economics of its ammonia recovery technology to potential strategic partners.

THERE IS NO ASSURANCE THAT

THE COMPANY WILL REACH OR APPROACH THE GOALS/TARGETS SET FORTH ABOVE.

REACHING SUCH GOALS/TARGETS WILL REQUIRE RESOLUTION OF THE COMPANY’S

EXISTING FINANCIAL DIFFICULTIES AND ACCESS TO VERY LARGE AMOUNTS OF CAPITAL (EQUITY AND DEBT) AS EACH ARS MODULE IS PROJECTED TO COST

IN EXCESS OF $10 MILLION TO CONSTRUCT AND WILL REQUIRE MOBILIZATION OF SUBSTANTIAL PERSONNEL, TECHNICAL RESOURCES AND MANAGEMENT SKILLS.

THE COMPANY DOES NOT POSSESS EITHER THE FINANCIAL OR PERSONNEL RESOURCES INTERNALLY AND WILL NEED TO SOURCE SUCH RESOURCES FROM STRATEGIC

BION ENVIRONMENTAL TECHNOLOGIES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED JUNE 30, 2025 AND 2024

ACCOUNTING POLICIES

Principles of consolidation :

The consolidated financial statements include the

accounts of the Company and its wholly-owned subsidiaries, Bion Integrated Projects Group, Inc., Bion Technologies, Inc., BionSoil, Inc.,

Bion Services, Bion PA2 LLC and Bion 3G-1 LLC (“3G1”);

The consolidated financial statements include

the accounts of the Company and its wholly-owned subsidiaries, Bion Integrated Projects Group, Inc., Bion Technologies, Inc., BionSoil,

Inc., Bion Services, Bion PA2 LLC and Bion 3G-1 LLC (“3G1”);

and its 58.9% owned subsidiary, Centerpoint Corporation (“Centerpoint”).

All significant intercompany accounts and transactions have been eliminated in consolidation.

Operating Segment:

Company operates a single reportable segment:

advanced waste treatment and resource recovery solutions for organic waste streams.

in the future the Company may pursue other segments—develop integrated livestock projects, implement CAFO retrofits, and exploit

other opportunities to use its proprietary technology (as previously described)—at this time it is now focused entirely on bolt-on

solutions for existing or planned biogas production facilities.

The business is managed by the Chief Executive Officer who is the Chief

Operating Decision Maker (“CODM”).

The CODM evaluates segment performance based on the operating income (loss) for purposes

of allocating resources and evaluating financial performance.

The accounting policies of our single reportable segment are the same

as those for the Company as a whole.

Cash and cash equivalents :

The Company considers all highly liquid investments purchased with an original

maturity of three months or less to be cash and cash equivalents.

As of June 30, 2024 and June 30, 2023 there are no cash equivalents.

The Company considers all highly liquid investments purchased with

an original maturity of three months or less to be cash and cash equivalents.

As of June 30, 2025 and June 30, 2024 there are no cash

Property and equipment :

Property and equipment are

stated at cost and are depreciated, when placed into service, using the straight-line method over the estimated useful lives of the related

assets, generally three to twenty years.

The Company capitalizes all direct costs and all indirect incrementally identifiable costs related

to the design and construction of its Integrated Projects such as consulting fees, internal salaries and benefits and interest.

reviews its property and equipment for impairment whenever events or changes in circumstances indicate that the carrying amount of an

asset may not be recoverable.

An impairment loss would be recognized based on the amount by which the carrying value of the assets or

asset group exceeds its estimated fair value and is recognized as a loss from operations.

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)

Property and equipment

are stated at cost and are depreciated, when placed into service, using the straight-line method over the estimated useful lives of the

related assets, generally three to twenty years.

The Company capitalizes all direct costs and all indirect incrementally identifiable

costs related to the design and construction of its Integrated Projects such as consulting fees, internal salaries and benefits and interest.

The Company reviews its property and equipment for impairment whenever events or changes in circumstances indicate that the carrying amount

of an asset may not be recoverable.

An impairment loss would be recognized based on the amount by which the carrying value of the assets

or asset group exceeds its estimated fair value and is recognized as a loss from operations.

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.

BION ENVIRONMENTAL TECHNOLOGIES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED JUNE 30, 2024 AND 2023

Stock-based compensation :

The Company follows the provisions of Accounting Standards

Codification (“ASC”) 718, which generally requires that share-based compensation transactions be accounted and recognized

The Company follows the provisions of Accounting

Standards Codification (“ASC”) 718, which generally requires that share-based compensation transactions be accounted and recognized

in the statement of operations based upon their grant date fair values.

Derivative Financial Instruments :

Pursuant to ASC Topic 815 “Derivatives and Hedging”

(“Topic 815”), the Company reviews all financial instruments for the existence of features which may require fair value accounting

and a related mark-to-market adjustment at each reporting period end.

Once determined, the Company assesses these instruments as derivative

The fair value of these instruments is adjusted to reflect the fair value at each reporting period end, with any increase

or decrease in the fair value being recorded in results of operations as an adjustment to fair value of derivatives.

The Company has issued options to employees and consultants

under the 2006 Plan to purchase common shares of the Company.

Options are valued on the grant date using the Black-Scholes option-pricing

Pursuant to ASC Topic 815 “Derivatives and

Hedging” (“Topic 815”), the Company reviews all financial instruments for the existence of features which may require

fair value accounting and a related mark-to-market adjustment at each reporting period end.

Once determined, the Company assesses these

instruments as derivative liabilities.

The fair value of these instruments is adjusted to reflect the fair value at each reporting period

end, with any increase or decrease in the fair value being recorded in results of operations as an adjustment to fair value of derivatives.

The Company has issued options to employees and

consultants under the 2006 Plan to purchase common shares of the Company.

Options are valued on the grant date using the Black-Scholes

option-pricing model.

The expected volatility is based on the historical price volatility of the Company’s common stock.

The dividend yield represents

the Company’s anticipated cash dividend on common stock over the expected term of the stock options.

Treasury bill rate

for the expected term of the stock options was utilized to determine the risk-free interest rate.

The expected term of stock options represents

the period of time the stock options granted are expected to be outstanding based upon management’s estimates.

yield represents the Company’s anticipated cash dividend on common stock over the expected term of the stock options.

bill rate for the expected term of the stock options was utilized to determine the risk-free interest rate.

The expected term of stock

options represents the period of time the stock options granted are expected to be outstanding based upon management’s estimates.

BION ENVIRONMENTAL TECHNOLOGIES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED JUNE 30, 2025 AND 2024

The Company has issued warrants to purchase common

21 unchanged sentences

Fair value measurements :

Fair value is defined as the price that would be received

to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date in the

principal or most advantageous market.

The Company uses a fair value hierarchy that has three levels of inputs, both observable and unobservable,

with use of the lowest possible level of input to determine fair value.

Level 1 – quoted prices (unadjusted) in active

markets for identical assets or liabilities;

Fair value is defined as the price that would

be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement

date in the principal or most advantageous market.

The Company uses a fair value hierarchy that has three levels of inputs, both observable

and unobservable, with use of the lowest possible level of input to determine fair value.

Level 1 – quoted prices (unadjusted) in

active markets for identical assets or liabilities;

Level 2 – observable inputs other than Level

36 unchanged sentences

reflected in the consolidated statements of operations over the lease term.

For leases with a term exceeding 12 months,

a lease liability is recorded on the Company’s consolidated balance sheet at lease commencement reflecting the present value of

its fixed minimum payment obligations over the lease term.

A corresponding right-of-use (“ROU”) asset equal to the initial

lease liability is also recorded, adjusted for any prepaid rent and/or initial direct costs incurred in connection with execution of the

lease and reduced by any lease incentives received.

For purposes of measuring the present value of its fixed payment obligations for a

given lease, the Company uses its incremental borrowing rate, determined based on information available at lease commencement, as rates

implicit in its leasing arrangements are typically not readily determinable.

The Company's incremental borrowing rate reflects the rate

it would pay to borrow on a secured basis and incorporates the term and economic environment of the associated lease.

For leases with a term exceeding 12 months, a

lease liability is recorded on the Company’s consolidated balance sheet at lease commencement reflecting the present value of its

fixed minimum payment obligations over the lease term.

A corresponding right-of-use (“ROU”) asset equal to the initial lease

liability is also recorded, adjusted for any prepaid rent and/or initial direct costs incurred in connection with execution of the lease

and reduced by any lease incentives received.

For purposes of measuring the present value of its fixed payment obligations for a given

lease, the Company uses its incremental borrowing rate, determined based on information available at lease commencement, as rates implicit

in its leasing arrangements are typically not readily determinable.

The Company's incremental borrowing rate reflects the rate it would

pay to borrow on a secured basis and incorporates the term and economic environment of the associated lease.

Revenue Recognition :

The Company currently does not generate revenue and

if and when the Company begins to generate revenue the Company will comply with the provisions of ASC 606 “Revenue from Contracts

The Company currently does not generate revenue

and if and when the Company begins to generate revenue the Company will comply with the provisions of ASC 606 “Revenue from Contracts

with Customers”.

7 unchanged sentences

(loss) per share was the same, as the impact of potential dilutive common shares was anti-dilutive.

The following table represents the warrants and options

(as if exercised) and convertible securities (as if converted) that have been excluded from the calculation of basic income (loss) per

Schedule of basic income (loss) per

The following table represents the warrants and

options (as if exercised) and convertible securities (as if converted) that have been excluded from the calculation of basic income (loss)

Schedule of basic income (loss) per share

Convertible debt

5 unchanged sentences

of the basic and diluted income (loss) per share computations for the years ended June 30, 2025 and 2024.

Schedule of reconciliation of the denominators

of the basic and diluted income (loss) per share

Schedule of reconciliation of the denominators of the basic and diluted income (loss) per share

Shares issued – beginning of period

4 unchanged sentences

Use of estimates :

In preparing the Company’s consolidated financial

statements in conformity with accounting principles generally accepted in the United States of America, management is required to make

estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities

at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.

Actual results

could differ from those estimates.

In preparing the Company’s consolidated

financial statements in conformity with accounting principles generally accepted in the United States of America, management is required

to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and

liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.

results could differ from those estimates.

Recent Accounting Pronouncements :

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and assures that there are proper controls in place to ascertain that the Company’s consolidated financial statements properly reflect

Improvements to Reportable

Segment Disclosures

In November 2023, the FASB issued Accounting

Standards Update (ASU) 2023-07, which amends Topic 280, Segment Reporting.

The update is designed to improve financial reporting

by requiring public entities to disclose more detailed and disaggregated information about their reportable segments.

Key changes introduced by ASU 2023-07 include

the requirement for public entities to disclose significant expense categories for each reportable segment, applicable to expenses regularly

provided to the chief operating decision maker (CODM).

Entities with a single reportable segment must now provide all segment disclosures

required by Topic 280.

The expanded disclosures are required for both annual and interim periods.

Entities may report multiple measures

of segment profit or loss, as long as one aligns with U.S.

Additionally, the title and position of the CODM and an explanation

of how the reported profit or loss measures are used must be disclosed.

ASU 2023-07 is effective for public entities

for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024.

adoption is permitted.

The amendments are applied retrospectively unless impractical, and prior-period segment information should be

recast to conform to the new presentation.

The adoption of ASU 2023-07 primarily impacts

the disclosures in the notes to the consolidated financial statements by requiring more detailed segment expense information.

not affect the consolidated balance sheets, statements of operations, or statements of cash flows.

The company adopted this guidance

effective June 30, 2025.

PROPERTY AND EQUIPMENT :

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Property and equipment, net

The 3G1 project (“Initial Project”) began

in July of 2021, with a lease signed on land October 1, 2021 (Note 8).

Once the lease commenced the Company moved into construction phase.

The balance for the Initial Project construction in process includes $ 74,144 and $ 211,984 for capitalized interest and $ 135,648 and $ 135,648

in non-cash compensation as of June 30, 2024 and 2023, respectively.

Management previously believed that the Initial Project

had reached the point where it could be appropriately deemed ‘placed in service’ at January 1, 2024.

However, discussions

with the key technical and engineering personnel involved at the Initial Project during the recently concluded quarter convinced management

that such a characterization was premature as some key modules had not yet been completed and/or fully tested.

Additionally, due to some

recent equipment break-downs, the Initial Project is currently in maintenance mode rather than conducting operations while the Company

awaits required replacement parts and subsequent repairs.

This process has been slowed by the Company’s ongoing difficulties in

raising needed funds for its activities.

The Company’s Board of Directors re-evaluated the classification/status of the Initial

Project as part of the Company’s annual review process and determined that the Initial Project had been ‘placed in service’

at the June 30, 2024 fiscal year end.

Further, after extensive discussion, it was determined that ‘carrying value’ of the

Initial Project on the Company balance sheet as of that date be reduced to $ 0 in order to conform to the applicable accounting literature

and guidance that the Company’s management had received because the Initial Project is:

i) largely a research & development

facility and ii) is located on land subject to a short term lease.

As a result, a large ‘one time/non-recurring’ ‘non-cash’

charge of $ 9,460,425 has been taken by the Company at June 30, 2024.

Depreciation expense was $ 1,582 and $ 1,645 for

the years ended June 30, 2024 and 2023, respectively.

Depreciation expense was $ 695 and $ 1,582 for the

years ended June 30, 2025 and 2024, respectively.

BION ENVIRONMENTAL TECHNOLOGIES, INC.

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COMPENSATION :

The Company owes deferred compensation to various

employees, former employees and consultants totaling $ 890,223

and $ 864,781 as of June 30,

2024 and 2023, respectively.

Included in the deferred compensation balances as of June 30, 2024, are $ 160,133

owed Craig Scott (“Scott”), the Company’s current CEO, $ 367,500 ,

owed William O’Neill (“O’Neill”), the Company’s former CEO (until May 31, 2024), $ 11,834 owed the estate/heirs of Dominic Bassani (“Bassani”), the Company’s recently deceased former Chief Operating

Officer (who was Chief Executive Officer until through April 30, 2022) (NOTE:

Dominic Bassani passed away on November 11, 2023.), and

$ 75,748 owed Mark A.

Smith (“Smith”), the Company’s recently retired President, respectively.

The sums owed to Bassani and Smith are owed

pursuant to extension agreements effective January 1, 2015, whereby unpaid compensation earned after January 1, 2015, accrues interest

at 4 % per annum and can be converted into shares of the Company’s common stock at the election of the employee during the first

five calendar days of any month.

The conversion price shall be the average closing price of the Company’s common stock for the

last 10 trading days of the immediately preceding month.

The Company owes deferred

compensation to various employees, former employees and consultants totaling $ 1,173,237 and $ 890,223 as of June 30, 2025 and June 30,

2024, respectively.

Included in the deferred compensation balances as of June 30, 2025, are $ 367,500 , $ 12,306 and $ 83,964 owed William

O’Neill (“O’Neill”), the Company’s former CEO (until May 31, 2024), the estate/heirs of Dominic Bassani

(“Bassani”), the Company’s recently deceased former Chief Operating Officer (who was Chief Executive Officer until through

April 30, 2022) (NOTE:

Dominic Bassani passed away on November 11, 2023.), and Mark A.

Smith (“Smith”), the Company’s

recently retired President, respectively.

The sums owed to Bassani and

Smith are owed pursuant to extension agreements effective January 1, 2015, whereby unpaid compensation earned after January 1, 2015, accrues

interest at 4 % per annum and can be converted into shares of the Company’s common stock at the election of the employee during the

first five calendar days of any month.

The conversion price shall be the average closing price of the Company’s common stock for

the last 10 trading days of the immediately preceding month.

The deferred compensation owed Bassani and Smith as of June 30, 2025 was

$ 12,306 and $ 83,964 , respectively.

O’Neill is owed a balance of $ 367,500 and $ 140,000

at June 30, 2024 and 2023, respectively, pursuant to his 2021 employment agreement.

There is no interest accrual or conversion rights

related to the deferred balance.

O’Neill terminated his service to the Company prior to the full term of his agreement.

The Company owes deferred compensation to Craig

Scott of $ 160,133

at June 30, 2024 and 2023, respectively, with similar conversion terms as those described above for Bassani and Smith, with the

exception that the interest accrues at 0% to 3% per annum.

The Company also owes various consultants and

an employee, pursuant to various agreements, for deferred compensation of $ 202,509 and $ 51,444 as of June 30, 2024 and 2023, respectively,

with similar conversion terms as those described above for Bassani and Smith, with the exception that the interest accrues at 0% to 3%

The Company also owes a former employee $ 72,500 , which is not convertible and is non-interest bearing.

Bassani and Smith have

each been granted the right to convert up to $ 300,000 of deferred compensation balances at a price of $ 0.75 per share until January 15,

O’Neill is owed a balance

of $ 367,500 and $ 367,500 at June 30, 2025 and June 30, 2024, respectively, pursuant to his 2021 employment agreement.

There is no interest

accrual or conversion rights related to the deferred balance.

O’Neill terminated his service to the Company prior to the full term

of his agreement.

The Company owes deferred compensation

to Craig Scott of $ 330,046 and $ 160,133 at June 30, 2025 and June 30, 2024, respectively, with similar conversion terms as those described

above for Bassani and Smith, with the exception that the interest accrues at 0% to 3% per annum.

The Company also owes various

consultants and employees, pursuant to various agreements, for deferred compensation of $ 306,920 and $ 202,509 as of June 30, 2025 and

June 30, 2024, respectively, with similar conversion terms as those described above for Bassani and Smith, with the exception that the

interest accrues at 0% to 3% per annum.

The Company also owes a former employee $ 72,500 , which is not convertible and is non-interest

Bassani and Smith have each

been granted the right to convert up to $ 300,000 of deferred compensation balances at a price of $ 0.75 per share until September 15, 2025,

into common shares (to be issued pursuant to the 2006 Plan).

6 unchanged sentences

($ 10,131 with related parties) and $ 30,379 ($ 25,893 with related parties) for the years ended June 30, 2025 and 2024, respectively.

CONVERTIBLE NOTES PAYABLE :

BION ENVIRONMENTAL TECHNOLOGIES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED JUNE 30, 2025 AND 2024

CONVERTIBLE NOTES

Adjusted 2020 Convertible Obligations and Adjusted

4 unchanged sentences

by 80% (approximately $3.47 million, in aggregate while equitably maintaining existing conversion rights).

The debt modification

was treated as an equity transaction because the modifications were with affiliates that are related parties.

BION ENVIRONMENTAL TECHNOLOGIES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED JUNE 30, 2024 AND 2023

Smith (the Company’s

President)(“Smith”), Dominic Bassani (the Company’s Chief Operating Officer) (“Bassani”) ( NOTE :

Dominic Bassani passed away on November 11, 2023.) and Ed Schafer (Director)(“Schafer”), adjusted/reduced the principal

owed to them by $ 1,109,649 ,

modification was treated as an equity transaction because the modifications were with affiliates that are related parties.

Smith (the Company’s former

President)(“Smith”), Dominic Bassani (the Company’s former

Chief Operating Officer) (“Bassani”) ( NOTE :

Dominic Bassani passed away on November 11, 2023 and is no longer an affiliate during the year ended June 30, 2025.) and Ed Schafer

(Director)(“Schafer”), adjusted/reduced the principal owed to them by $ 1,109,649 ,

and $ 424,873 ,

11 unchanged sentences

The Adjusted 2020 Convertible Obligations and Adjusted September 2015

Convertible Notes do not accrue any interest until their maturity date (January 15, 2025).

Convertible Notes do not accrue any interest until their maturity date.

After the adjustment, the Company owed

3 unchanged sentences

Adjusted September 2015 Convertible Notes.

The Company has extended the maturity dates to September 15, 2025.

As of June 30, 2025, the Adjusted 2020

4 unchanged sentences

his donees), Smith and Edward Schafer were $ 459,277 ,

and $ 98,014 ,

respectively.

As of June 30, 2024 the Adjusted September 2015 Convertible

Notes balances, including accrued interest, owed Bassani Family Trusts and Schafer were $ 7,907 and $ 4,246 , respectively.

As of June 30,

2023 the Adjusted September 2015 Convertible Notes balances, including accrued interest, owed Bassani Family Trusts and Schafer were $ 24,645

and $ 4,081 , respectively.

nil 0 and $ 101,973 , respectively.

As of June 30, 2025 the Adjusted September

2015 Convertible Notes balances, including accrued interest, owed Bassani Family Trusts and Schafer were $ 7,907

and nil 0 respectively.

As of June 30, 2024 the Adjusted September 2015 Convertible Notes balances, including accrued interest, owed

Bassani Family Trusts and Schafer were $ 7,907 and $ 4,246 , respectively.

On September 15, 2025, settlements were reached

Schafer, and the Bassani family, to surrender additional securities.

Included in these agreements were provisions

to cancel these convertible note obligations, effective on that date.

For details on these settlement agreements, see Item 1, Note F above.

2020 Convertible Obligations

The 2020 Convertible Obligations (which combined/replaced

prior convertible instruments dating to 2017 (or earlier), which accrue interest at either 4 % per annum or 4 % compounded quarterly

and effective January 1, 2020 are due and payable on July 1, 2024.

The 2020 Convertible Obligations (including accrued interest, plus

all future deferred compensation added subsequently), are convertible, at the sole election of the holder, into Units consisting of one

share of the Company’s common stock and one half to one warrant to purchase a share of the Company’s common stock, at a price

of $ 0.50 per Unit until July 1, 2024.

The maturity date of the notes has been extended to January 15, 2025.

The 2020 Convertible Obligations

(which combined/replaced prior convertible instruments dating to 2017 (or earlier), which accrue interest at either 4% per annum or 4%

compounded quarterly and effective January 1, 2020 were due and payable on July 1, 2024.

The 2020 Convertible Obligations (including accrued

interest, plus all future deferred compensation added subsequently), are convertible, at the sole election of the holder, into Units consisting

of one share of the Company’s common stock and one half to one warrant to purchase a share of the Company’s common stock,

at a price of $0.50 per Unit until July 1, 2024.

The maturity date of the notes has been extended to July 15, 2025.

The original conversion

price of $0.50 per Unit approximated the fair value of the Units at the date of the agreements;

therefore, no beneficial conversion

feature exists.

Management evaluated the terms and conditions of the embedded conversion features based on the guidance of ASC 815-15

“Embedded Derivatives” to determine if there was an embedded derivative requiring bifurcation.

An embedded derivative instrument

(such as a conversion option embedded in the deferred compensation) must be bifurcated from its host instruments and accounted for separately

as a derivative instrument only if the “risks and rewards” of the embedded derivative instrument are not “clearly and

closely related” to the risks and rewards of the host instrument in which it is embedded.

Management concluded that the embedded

conversion feature of the deferred compensation was not required to be bifurcated because the conversion feature is clearly and closely

related to the host instrument, and because of the Company’s limited trading volume that indicates the feature is not readily convertible

to cash in accordance with ASC 815-10, “Derivatives and Hedging”.

Effective February 1, 2023, a large portion of the 2020

Convertible Obligations were adjusted as set forth herein.

therefore, no beneficial conversion feature

Management evaluated the terms and conditions of the embedded conversion features based on the guidance of ASC 815-15 “Embedded

Derivatives” to determine if there was an embedded derivative requiring bifurcation.

An embedded derivative instrument (such as

a conversion option embedded in the deferred compensation) must be bifurcated from its host instruments and accounted for separately as

a derivative instrument only if the “risks and rewards” of the embedded derivative instrument are not “clearly and closely

related” to the risks and rewards of the host instrument in which it is embedded.

Management concluded that the embedded conversion

feature of the deferred compensation was not required to be bifurcated because the conversion feature is clearly and closely related to

the host instrument, and because of the Company’s limited trading volume that indicates the feature is not readily convertible to

cash in accordance with ASC 815-10, “Derivatives and Hedging”.

Effective February 1, 2023, a large portion of the 2020 Convertible

Obligations were adjusted as set forth herein.

The maturity date of the notes has been extended to September 15, 2025.

BION ENVIRONMENTAL TECHNOLOGIES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED JUNE 30, 2025 AND 2024

Effective January 9, 2025,

the Board of Directors amended the terms of the 2020 Adjusted Convertible Note owned by Ed Schafer, who retired from the Company’s

Board of Directors on December 31, 2024.

The maturity date of the 2020 Adjusted Convertible Note has been extended to September 15, 2025.

On September 15, 2025, a settlement was reached

Schafer to cancel the 2020 Adjusted Convertible Note, effective on that date.

For details on the settlement agreement, see Item

1, Note F above.

As of June 30, 2025, the remaining unadjusted

portion of the 2020 Convertible Obligation balances, including accrued interest, owed Bassani Family Trusts (and his donees) and

Smith, were $ 373,999 and

portion of the 2020 Convertible Obligation balances, including accrued interest, owed Bassani Family Trusts and Smith were $ 386,676 and

$ 125,919 , respectively.

As of June 30, 2024, the remaining unadjusted portion of the 2020 Convertible Obligation balances, including accrued

interest, owed Bassani Family Trusts, Smith and Schafer were $ 361,321 ,

nil, 0 respectively.

During the year ended June 30, 2024, Smith elected

to convert $ 140,951 of his Adjusted 2020 Convertible Obligation into 1,489,969 units at $ 0.0946 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 until July 2026.

The Company recorded interest expense of $ 16,558 and

$ 102,478 for the years ended June 30, 2024 and 2023, respectively.

The Company capitalized $ 62,162 and $ 179,981 related to the Initial

Project for the years ended June 30, 2024 and 2023, respectively.

interest, owed Bassani Family Trusts (and his donees) and Smith, were $ 373,999 and $ 121,076 , respectively.

The Company recorded interest expense of $ 17,521

and $ 16,558 for the years ended June 30, 2025 and 2024, respectively.

Effective February 1, 2023, three (3) directors/officers

5 unchanged sentences

The Company recorded a deemed dividend for the reductions.

Smith, Bassani and Schafer, adjusted/reduced

the principal owed to them by $1,109,649, $1,939,670 and $424,873, respectively.

Subsequent to the adjustment, the adjusted portion of

the 2020 Convertible Obligations were renamed Adjusted 2020 Convertible Obligations (see above and Note 8.).

September 2015 Convertible Notes

During the year ended June 30, 2016, the Company

entered into September 2015 Convertible Notes with Bassani, Schafer and a Shareholder which replaced previously issued promissory notes.

The September 2015 Convertible Notes bear interest at 4% per annum, have maturity dates of July 1, 2024, and may be converted at

the sole election of the noteholders into restricted common shares of the Company at a conversion price of $0.60 per share.

conversion price of $0.60 approximated the fair value of the common shares at the date of the September 2015 Convertible Notes, no beneficial

conversion feature exists.

The maturity date of the notes has been extended to September 15, 2025

for all note holders.

On September 15, 2025 the maturity date for two of the 2015 Convertible Notes was extended to September

Effective January 16, 2025,

Schafer voluntarily surrendered 36,918 shares of common stock that would have been issued as the result of the conversion of his $4,246

Adjusted 2015 Convertible Note.

The note was convertible at $0.115 per share.

As of June 30, 2025, the remaining

unadjusted portion of the 2015 Convertible Notes balances including accrued interest, were $ 169,383 ,

and $ 491,107 , respectively.

The balances of the September 2015 Convertible Notes as of June 30, 2024, including accrued interest

owed Bassani, Schafer and Shareholder, are $ 164,183 ,

nil 0 and $ 475,990 , respectively.

The Company recorded interest expense of $ 20,317

and $ 20,317 for the years ended June 30, 2025 and 2024, respectively.

On September 15, 2025, settlements were reached

Schafer, and the Bassani family to surrender additional securities.

Included in these agreements were provisions to

cancel these convertible note obligations, effective on that date.

For details on these settlement agreements, see Item 1, Note F above.

BION ENVIRONMENTAL TECHNOLOGIES, INC.

2 unchanged sentences

YEARS ENDED JUNE 30, 2025 AND 2024

Smith (the Company’s President) (“Smith”),

Dominic Bassani (the Company’s Chief Operating Officer) (“Bassani”) (NOTE:

Dominic Bassani passed away on November 11,

See Note 9) and Ed Schafer (Director) (“Schafer”), adjusted/reduced the principal owed to them by $ 1,109,649 , $ 1,939,670

and $ 424,873 , respectively.

Subsequent to the adjustment, the adjusted portion of the 2020 Convertible Obligations were renamed Adjusted

2020 Convertible Obligations (see above and Note 6.).

September 2015 Convertible Notes

During the year ended June 30, 2016, the Company entered

into September 2015 Convertible Notes with Bassani, Schafer and a Shareholder which replaced previously issued promissory notes.

The September

2015 Convertible Notes bear interest at 4% per annum, have maturity dates of July 1, 2024, and may be converted at the sole election

of the noteholders into restricted common shares of the Company at a conversion price of $ 0.60 per share.

As the conversion price

of $0.60 approximated the fair value of the common shares at the date of the September 2015 Convertible Notes, no beneficial conversion

feature exists.

The maturity date of the notes has been extended to January 15, 2025 for Bassani and July 1, 2025 for the other note holders.

The balances of the September 2015 Convertible

Notes as of June 30, 2024, including accrued interest owed Bassani, Schafer and Shareholder, are $ 164,183 ,

nil 0 and $ 475,990 , respectively.

As of June 30, 2023, the remaining unadjusted portion of the 2015 Convertible Notes balances

including accrued interest, were $ 183,628 , $ 4,081 , and $ 460,873 , respectively.

The Company recorded interest expense of $ 20,317 and

$ 23,381 for the year ended June 30, 2024 and 2023, respectively.

Effective February 1, 2023, three

(3) directors/officers of the Company agreed to adjust the provisions of long term convertible obligations (including the

September 2015 Convertible Notes owned by Bassani and Schafer) owed to them by the Company in a manner which reduced the

indebtedness of the Company by 80% (approximately $3.52 million, in aggregate) while equitably maintaining existing conversion

Smith (the Company’s President), Dominic Bassani (the Company’s Chief Operating Officer)(and a

family Trust) and Ed Schafer (Director), adjusted/reduced the principal owed to them by $ 1,109,649 ,

$ 1,939,670 and

respectively.

Subsequent to the adjustment, the adjusted portion of the Notes were renamed Adjusted September 2015 Convertible

The Adjusted September 2015 Convertible Notes may be converted at the sole election of the noteholders into restricted common

shares of the Company at a conversion price of $0.115 per share.

As of June 30, 2024, the Adjusted September 2015 Convertible

Notes balances, including accrued interest, owed Bassani Family Trusts and Schafer were $ 7,907

and $ 4,246 ,

respectively.

The debt modification was treated as an equity transaction because the modifications were with affiliates that are

related parties.

Convertible Bridge Loan/Default

On September 28, 2023, in order to partially mitigate

the problems discussed above, the Company entered into an agreement for a $ 1,500,000 bridge loan and executed documents including a convertible

promissory note (“Note”) and a binding subscription agreement (“Subscription”) (collectively the Note and the

Subscription are the “Bridge Loan Agreements”) with SEB LLC, a non-affiliated party (“Lender”).

The Bridge Loan

Agreements require the Lender to loan the Company $ 1,500,000 in six monthly tranches of $ 250,000 commencing October 2023.

All sums advanced

under the Bridge Loan Agreements (and accrued interest thereon) would due and payable (with interest accrued at 9 % per annum) on October

1, 2024 if not previously converted into securities of the Company.

The Note is convertible at $ 1.00 per unit, at the sole election of

the Lender, into units consisting of one share of the Company’s common stock and a warrant to purchase one half share.

$ 250,000 tranche was received by the Company on October 5, 2023.

However, no further funds were received by the Company from the Lender.

During early November 2023 the Lender informed the Company verbally that it did not intend to fulfill its obligations pursuant to the

Bridge Loan Agreements and since such time the Lender has been in default (“Default”).

On May 10, 2024 the Company received

$150,000 from affiliates of the Bridge Loan Lender on terms not yet finalized and included in an agreement.

These funds were received

in the context of negotiations/discussions regarding a potential larger investment by affiliates and/or associates of the Lender but no

further funds were received but the larger transaction was never completed.

The funds were used primarily to re-initiate operations at

the Initial Project.

The Default (which is continuing) has created substantial problems for and materially damaged the Company and rendered

the Company unable to meet its current creditor obligations on a timely basis.

The Company is currently evaluating its rights regarding

the Default by the Lender.

This situation has contributed to the substantial increase in the Company’s ‘Current Liabilities’

including ‘accounts payable’ over recent periods.

See Consolidated Financial Statements and ‘Management’s Discussion

and Analysis’.

The Company has engaged in discussion/negotiation with its larger creditors (including its largest creditor--- the

primary contractor on the Initial Project) but has been unable to reach agreements regarding payments due to the uncertainty as to if,

when and how much funding the Company will be able to raise in future periods.

As a result, the Company’s largest creditor---the

general contractor for the Initial Project --- has filed a mechanics lien in Indiana (and its largest sub-contractor has sent notices

related to its intention to file a mechanics lien) and other creditors are threatening to commence litigation and other creditors are

threatening to commence litigation and/or repossess/remove leased equipment).

The Company recorded interest expense of 18,659 and

nil 0 for the years ended June 30, 2024 and 2023, respectively.

On September 28, 2023, the

Company entered into an agreement for a $ 1,500,000 bridge loan and executed documents including a convertible promissory note (“Note”)

and a binding subscription agreement (“Subscription”) (collectively the Note and the Subscription are the “Bridge Loan

Agreements”) with SEB LLC, a non-affiliated party (“Lender”).

SEB and the note represented a strategic investment that

would ‘anchor’ a larger capital raise.

In addition to SEB, it was to include an offering to Bion shareholders, alongside new

retail and institutional investors introduced by Titan Partners, the NY investment banking firm Bion engaged to underwrite the offering.

The Bridge Loan Agreements required the Lender to loan the Company $ 1,500,000 in six monthly tranches of $ 250,000 commencing October 2023.

All sums advanced under the Bridge Loan Agreements (and accrued interest thereon) would be due and payable (with interest accrued at 9 %

per annum) on October 1, 2024 if not previously converted into securities of the Company.

The Note is convertible at $ 1.00 per unit, at

the sole election of the Lender, into units consisting of one share of the Company’s common stock and a warrant to purchase one

The initial $ 250,000 tranche was received by the Company on October 5, 2023.

However, no further funds were received by the

Company from the Lender.

On May 10, 2024 the Company

received $150,000 from affiliates of the Bridge Loan Lender on terms not yet finalized and included in an agreement.

These funds were

received in the context of negotiations/discussions regarding a potential larger investment by affiliates and/or associates of the Lender

but no further funds were received and the larger transaction was never completed.

The funds were used primarily to re-initiate operations

at the Initial Project.

The Company is currently involved in discussions with representatives of SEB in an effort to achieve a mutually

satisfactory resolution.

The Company recorded interest expense of $ 36,298

and $ 18,659 for the years ended June 30, 2025 and 2024, respectively.

May 2024 Convertible Notes

During the year ended June

30, 2024, the Company entered into May 2024 Convertible Notes with five individuals.

The May 2024 Convertible Notes bear interest at 6%

per annum, have maturity dates of December 31, 2025 , and may be converted at the sole election of the noteholders into one restricted

common shares and one warrant of the Company at a conversion price of $1.00 per unit.

As the conversion price of $1.00 approximated the

fair value of the common shares at the date of the May 2024 Convertible Notes, no beneficial conversion feature exists.

The balances of the May 2024

Convertible Notes including accrued interest owed is $ 133,067 and $ 125,567 as of June 30, 2025 and June 30, 2024, respectively.

The Company recorded interest expense of $ 7,500

and $ 567 for the year ended June 30, 2025 and 2024, respectively.

2024 Secured Convertible Note

On October 22, 2024, Bion's Board of

Directors ratified an agreement with the Bion BLG, LLC, loan group, effective October 15, 2024, to purchase a Convertible Promissory

Note in the principal amount of up to $ 500,000 .

The Company received advances the year ended June 30, 2025 in the amount of $399,763 and interest was applied based on the date the

funds were received.

The note bears interest at 7.5 %

per annum and has a maturity date of April

Three Bion Directors (Schoener,

Turk and Weets) are members of the loan group and together comprise 60% ownership of the loan group (each member owns 20%).

secured by the Company's Intellectual Property (IP)/patents.

The Note will convert into securities in the Company at the terms of a later

capital raise (or other source of funding) in excess of $3.0 million, which must be completed within six (6) months.

BION ENVIRONMENTAL TECHNOLOGIES, INC.

2 unchanged sentences

YEARS ENDED JUNE 30, 2025 AND 2024

May 2024 Convertible Notes

During the year ended June 30, 2016, the Company entered

into May 2024 Convertible Notes with five individuals.

The May 2024 Convertible Notes bear interest at 6% per annum, have maturity

dates of December 31, 2025 , and may be converted at the sole election of the noteholders into one restricted common shares and one warrant

of the Company at a conversion price of $ 1.00 per unit.

As the conversion price of $1.00 approximated the fair value of the common

shares at the date of the May 2024 Convertible Notes, no beneficial conversion feature exists.

The balances of the May 2024 Convertible Notes as

of June 30, 2024, including accrued interest owed is $ 125,567 .

The Company recorded interest expense of $ 567 and

nil 0 for the year ended June 30, 2024 and 2023, respectively.

On July 24, 2025, the Company entered into a Forbearance

Agreement with Bion BLG, LLC, (effective July 15, 2025) extending the maturity date of the BLG Note to January 15, 2026 (attached as exhibit).

The agreement was ratified by Bion’s Board on July 24, 2025.

Under the terms of the Forbearance Agreement, the amounts outstanding

under the Note will continue to bear interest at a rate of 9 % per annum.

Bion agreed to a new formula to determine BLG’s obligation

for up to $ 100,000 in legal costs related to litigation over delinquent payment for construction costs incurred at Bion’s demonstration

facility near Fair Oaks, IN (see Bion’s Forms 8-K, dated April 17, May 30 and July 24, 2025).

Bion BLG, LLC, also extended their

agreement to share their collateral with investors in the three prior Shareholder Note offerings, with investors participating in a new

offering, dated July 25, 2025.

Effective October 15, 2024, the Company entered

into an Agreement with BLG, LLC, to purchase a Convertible Promissory Note in the principal amount of up to $ 500,000 (See Bion’s

Form 8-K, dated October 24, 2024).

At that time, BLG, LLC, consisted of three affiliates of the Company (Directors Greg Schoener (also

Interim COO), Turk Stovall, and Bob Weerts) and two shareholders (one of whom is the brother of Greg Schoener).

BLG membership is currently

the same, but Bion accepted Turk Stovall’s resignation as a Director, effective May 30, 2025.

Amounts outstanding under the original

BLG Note bore interest at a rate of 7.5 % per annum through the maturity date of the Note, which was April 15, 2025.

The Note is secured

by the Company’s Intellectual Property (IP)/patents and it will convert into securities in the Company at the terms of a later capital

raise (or other source of funding) in excess of $3.0 million, that had to be completed within six (6) months, and other terms as defined

in the Note and Security Agreements (attached as exhibits).

Effective May 29, 2025, the Company entered

into a Forbearance Agreement with Bion BLG, LLC, extending the maturity date of the BLG Note to July 15, 2025 (See Bion’s Form 8-K,

dated May 30, 2025).

Under the terms of the Forbearance Agreement, the amounts outstanding under the Note began to bear interest at a

rate of 9 % per annum.

The balances of the 2024 Convertible Note Advances as of

June 30, 2025 including accrued interest owed is $ 423,053 .

The Company recorded interest expense of $ 23,290 for the

years ended June 30, 2025 .

November 2024 Convertible Notes

During the year ended June 30, 2025, the Company

entered into November 2024 Convertible Notes with twelve individuals.

The November 2024 Convertible Notes bear interest at 7.5 % per annum,

have maturity dates of December 31, 2025 .

The November Notes will convert into Units in the Company at the terms of a later capital raise,

in which the Company crosses the threshold of $3 million aggregate capital raised, including proceeds from this filing.

The balances of the November 2024 Convertible Notes including

accrued interest owed is $ 207,389 as of June 30, 2025.

The Company recorded interest expense of $ 6,389 for the year

ended June 30, 2025.

February 2025 Convertible Notes

During the year ended June

30 2025, the Company entered into February 2025 Convertible Notes with seven individuals.

The February 2025 Convertible Notes bear interest

at 7.5 % per annum, have maturity dates of December 31, 2025.

The February 2025 Notes will convert into Units in the Company at the terms

of a later capital raise, in which the Company crosses the threshold of $3 million aggregate capital raised, including proceeds from this

The balances of the February

2025 Convertible Notes including accrued interest owed is $ 157,416 as of June 30, 2025.

The Company recorded interest expense of $ 2,416

for the year ended June 30, 2025.

May 2025 Notes

During the year ended June

30, 2025, the Company entered into May 2025 Convertible with two individuals.

The May 2025 Convertible Notes bear interest at 7.5 % per

annum, have maturity dates of December 31, 2025.

The May 2025 Convertible Nores will convert into Unity in the Company at the terms of

a later capital raise, in which the Company crosses the threshold of $3 million aggregate capital raised, including proceeds from the

The balances of the May 2025

Convertible Notes including accrued interest owed is $ 70,288 as of June 30, 2025.

The Company recorded interest expense of $ 287 for the

year ended June 30, 2025.

BION ENVIRONMENTAL TECHNOLOGIES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED JUNE 30, 2025 AND 2024

STOCKHOLDERS’

Write down of carry value of Initial Project

Effective June 30, 2024, at the same time the Initial

Project was deemed placed in service, the Board of Directors determined that the capitalized carrying value of the Initial Project on

the Company balance sheet as of that date be reduced to $ 0 in order to conform to the applicable accounting practices, because the Initial

Project was recently reclassified as largely a research & development facility and is located on land subject to a short term lease

(as described above in Item 7, Management’s Discussion and Analysis).

Effective June 30, 2024, at the same time the

Initial Project was deemed placed in service, the Board of Directors determined that the capitalized carrying value of the Initial Project

on the Company balance sheet as of that date be reduced to $ 0 in order to conform to the applicable accounting practices, because the

Initial Project was recently reclassified as largely a research & development facility and is located on land subject to a short term

lease (as described above in Item 7, Management’s Discussion and Analysis).

As a result, a large ‘one time/non-recurring’

3 unchanged sentences

Paid in Capital

Effective April 1, 2024 the Company entered into two

material definitive agreements regarding voluntary surrender for cancellation of securities of the Company (and related matters) by:

members of the family of Dominic Bassani, recently deceased former Chief Executive Officer and (with his family) the Company’s largest

shareholder (collectively “Bassani Family”)(see Exhibit 10.1)(“Bassani Family Agreement”), and b) Mark A.

President of the Company and a director (see Exhibit 10.2)(“MAS Agreement”).

The Bassani Family and Smith entered into these

agreements with the intention of mitigating dilution to shareholders as new, successor management is added to the Company’s management

The “giveback” agreements were treated as equity transactions because the forfeitures were with affiliates that are

related parties.

The Bassani Family has agreed to surrender not less

than approximately 20% of its Company holdings (as of December 2023), which surrender will increase to approximately 30% based on certain

financing performances set forth in Exhibit 10.1.

The Bassani Family elected to surrender deferred compensation of $ 652,252 (for 770,792

shares), $ 17,734 of partial surrender of the 2015 adjusted replacement note (for 154,208 shares) and 4,025,000 options as of June 30,

2024, the Company’s fiscal year end.

The Bassani Family Agreement also sets forth requirements regarding conversion of convertible

notes held by members of the Bassani Family after the security surrender.

See Exhibit 10.1 for the material terms of the contemplated

transactions.

MAS has agreed to surrender approximately 30% of his

Company holdings (as of December 2023).

Immediately upon the effectiveness of the MAS Agreement, he cancelled all Company options held

by him ( 2,425,000 , in aggregate) and waived $ 56,250 of accrued deferred compensation (convertible into 75,000 shares of the Company’s

common stock).

The MAS Agreement also sets forth requirements regarding conversion of convertible notes held by MAS after the security

surrender and references the planned retirement of MAS on or before May 15, 2024.

See Exhibit 10.2 for the material terms of the contemplated

transactions.

Subsequently, and effective June 27, 2024, the Board

of Directors of the Company agreed to amend the terms of the agreements dated April 1, 2024.

The amendments solely extend any dates of

certain required conversions and/or exercises (and related promissory note maturity dates and warrant expiration dates), if any, that

were earlier than January 15, 2025, to said date.

No changes were made regarding any ‘givebacks’ of securities of the Company.

Effective April 1, 2024 the Company entered into

two material definitive agreements regarding voluntary surrender for cancellation of securities of the Company (and related matters) by:

a) members of the family of Dominic Bassani, recently deceased former Chief Executive Officer and (with his family) the Company’s

largest shareholder (collectively “Bassani Family”)(see Exhibit 10.1)(“Bassani Family Agreement”), and b) Mark

Smith, President of the Company and a director (see Exhibit 10.2)(“MAS Agreement”).

The Bassani Family and Smith entered

into these agreements with the intention of mitigating dilution to shareholders as new, successor management is added to the Company’s

management team.

The “giveback” agreements were treated as equity transactions because the forfeitures were with affiliates

that are related parties.

The Bassani Family agreed

to surrender not less than approximately 20% of its Company holdings (as of December 2023), which surrender would increase to approximately

30% based on certain financing performances.

The Bassani Family elected to surrender deferred compensation of $ 652,252 (for 770,792 shares),

$ 17,734 of partial surrender of the 2015 adjusted replacement note (for 154,208 shares) and 4,025,000 options as of June 30, 2024.

Bassani Family Agreement also sets forth requirements regarding conversion of convertible notes held by members of the Bassani Family

after the security surrender.

On January 18, 2025, under

the Bassani Family Agreement described above, Bion cancelled 1,237,500 warrants owned by the Bassani Family.

Under the terms of the Agreement,

the Bassani Family was required to surrender an additional 5% of their holdings after Bion successfully raised $ 500,000 in funding, following

the date of the agreement.

The warrants had a net exercise cost of $ 0.1875 .

MAS has agreed to surrender

approximately 30% of his Company holdings (as of December 2023).

Immediately upon the effectiveness of the MAS Agreement, he cancelled

all Company options held by him ( 2,425,000 , in aggregate) and waived $ 56,250 of accrued deferred compensation (convertible into 75,000

shares of the Company’s common stock).

The MAS Agreement also sets forth requirements regarding conversion of convertible notes

held by MAS after the security surrender and references the planned retirement of MAS on or before May 15, 2024.

Subsequently, and effective

June 27, 2024, the Board of Directors of the Company agreed to amend the terms of the agreements dated April 1, 2024.

The amendments solely

extend any dates of certain required conversions and/or exercises (and related promissory note maturity dates and warrant expiration dates),

if any, that were earlier than January 15, 2025, to said date.

On January 9, 2025, the Company

agreed to amend the terms of the agreements dated April 1, 2024 regarding voluntary surrender for cancellation of securities of the Company

(and related matters) by:

a) members of the family of Dominic Bassani, recently deceased former Chief Executive Officer and (with his

family) the Company’s largest shareholder (collectively “Bassani Family”)(see Form 8-K dated April 3, 2024, Exhibit

10.1)(“Bassani Family Agreement”), and b) Mark A.

Smith, President of the Company

and a director (“MAS”)(see Form 8-K dated April 3, 2024, Exhibit 10.2)(“MAS Agreement”).

The Bassani Family and

MAS entered into these agreements with the intention of mitigating dilution to shareholders as new, successor management is added to the

Company’s management team.

The amendments solely extend any dates of certain required conversions and/or exercises (and related

promissory note maturity dates and warrant expiration dates), if any, that were dated January 15, 2025, to April 15, 2025.

were made regarding any ‘give backs’ of securities of the Company.

On September 15, 2025, settlements

were reached with Mr.

Smith and the Bassani family, to surrender additional securities.

Included in the Bassani family agreement was a

provision to cancel their remaining 5% obligation under the giveback agreement.

For details on this settlement agreements, see Item 1,

Note F above.

Series B Preferred stock:

19 unchanged sentences

Common stock:

Holders of common stock are entitled to one vote per

share on all matters to be voted on by common stockholders.

In the event of liquidation, dissolution or winding up of the Company, the

holders of common stock are entitled to share in all assets remaining after liabilities have been paid in full or set aside and the rights

of any outstanding preferred stock have been satisfied.

Common stock has no preemptive, redemption or conversion rights.

The rights of

holders of common stock are subject to, and may be adversely affected by, the rights of the holders of any outstanding series of preferred

stock or any series of preferred stock the Company may designate in the future.

Centerpoint holds 704,309 shares of the Company’s

common stock.

These shares of the Company’s common stock held by Centerpoint are for the benefit of its shareholders without any

beneficial interest.

During the year ended June

30, 2024, the Company entered into subscription agreements to sell units for $ 1.60 per unit, with each unit consisting of one share of

the Company’s restricted common stock and one-half warrant to purchase shares of the Company’s restricted common stock

for $ 2.40 per share with an expiry date of 6/30/2024 and pursuant thereto, the Company issued 28,589 units for total proceeds of $ 45,742 .

See ‘ Warrants ’ below.

During the year ended June 30, 2024, the Company

entered into subscription agreements to sell 565,000 units at a price of $ 1.00 , with each unit consisting of one share of the Company’s

restricted common stock and one half warrant to purchase one share of the Company’s restricted common stock for $ 1.25 per share

with an expiry date of December 31, 2024, and pursuant thereto, the Company issued 565,000 units for total proceeds of $ 565,000 .

See ‘ Warrants ’

During the year ended June 30, 2024, 38,000

warrants were exercised to purchase 38,000 shares of the Company’s common stock at $ 0.75 per share for total proceeds of $ 28,500 .

During the year ended June 30, 2024, Smith elected

to convert $ 140,951 of principal from his Adjusted 2020 Convertible note into 1,489,969 Units;

each unit consisting of one share and one

warrant with the exercise price of $.75 until July 21, 2026.

Each of these warrants carry an exercise bonus of 75 %.

During the year ended June

30, 2024, the Company issued 89,847 shares of the Company’s common stock to non-affiliate consultants for services.

were issued at various prices between $ 0.82 to $ 1.55 per share pursuant to the terms of the applicable for a value of $ 112,321 for the

services provided.

During the year ended June 30, 2024, the Company issued

3,661 shares of the Company’s common stock upon cashless exercise of 5,000 outstanding options held by an affiliate of the Company.

During the year ended June 30, 2024, the Company

issued 3,607,165

shares of the Company’s common stock upon cashless exercise of 4,241,034

outstanding warrants held by non-affiliates of the Company.

During the year ended June 30, 2024, the Company issued

2,524,780 shares of the Company’s common stock upon cashless exercise of 2,927,197 outstanding warrants held by affiliates of the

As of June 30, 2024, the Company had approximately

17.1 million warrants outstanding, with exercise prices from $ 0.60 to $ 2.40 and expiring on various dates through November 9, 2026.

Holders of common stock are

entitled to one vote per share on all matters to be voted on by common stockholders.

In the event of liquidation, dissolution or winding

up of the Company, the holders of common stock are entitled to share in all assets remaining after liabilities have been paid in full

or set aside and the rights of any outstanding preferred stock have been satisfied.

Common stock has no preemptive, redemption or conversion

The rights of holders of common stock are subject to, and may be adversely affected by, the rights of the holders of any outstanding

series of preferred stock or any series of preferred stock the Company may designate in the future.

Centerpoint holds 704,309

shares of the Company’s common stock.

These shares of the Company’s common stock held by Centerpoint are for the benefit of

its shareholders without any beneficial interest.

During the year ended June 30, 2025, 159,228 shares of restricted

common stock were issued for consulting services valued at $ 34,500 .

As of June 30, 2025, the Company

had approximately 15.9 million warrants outstanding, with exercise prices from $ 0.60 to $ 1.60 and expiring on various dates through December

The weighted-average exercise price for the outstanding

warrants is $ 0.79 , and the weighted-average remaining contractual life as of June 30, 2025 is 40 years.

During the year ended June 30, 2024, Smith elected

to convert $ 140,951 of principal from his Adjusted 2020 Convertible Note into 1,489,969 Units;

each unit consisting of one share and one

warrant with the exercise price of $ .75 until July 21, 2026.

Each of these warrants carry an exercise bonus of 75 %.

During the year ended June 30, 2024, the Company

issued 3,607,165

shares of the Company’s common stock upon cashless exercise of 4,241,034

outstanding warrants held by non-affiliates of the Company.

During the year ended June 30, 2024, the Company issued

2,524,780 shares of the Company’s common stock upon cashless exercise of 2,927,197 outstanding warrants held by affiliates of the

On July 15, 2024 the Company

modified 5,795,099 warrants by extending the exercise date.

Employees and directors were extended two year and investors were extended

The valuation method used by the Company determines the valuation based on prior private placements.

One year extensions were

valued at $0.05 and two year extensions were valued at $0.15.

The company had non-cash employee compensation of $ 326,475 and interest

expense of $ 180,929 .

On January 15, 2025 the Company

modified 7,147,369 warrants by extending the exercise date from January 15, 2025 to July 15, 2025.

The valuation method used by the Company

determines the valuation based on prior private placements.

6 month extensions were valued at $0.025.

The company had non-cash employee

compensation of $ 178,684 .

On January 18, 2025, under

the Bassani Family Agreement described above, Bion cancelled 1,237,500 warrants owned by the Bassani Family.

Under the terms of the Agreement,

the Bassani Family was required to surrender an additional 5% of their holdings after Bion successfully raised $ 500,000 in funding, following

the date of the agreement.

The warrants had a net exercise cost of $ 0.1875 .

On April 15, 2025 the Company modified

3,000,000 warrants by extending the exercise date from June 30, 2025 to July 15, 2025.

The valuation method used by the Company

determines the valuation based on prior private placements.

6 month or less extensions were valued at $0.002.

The company had

non-cash employee compensation of $ 6,250 .

On September 15, 2025, settlements

were reached with Mr.

Smith and the Bassani family, to surrender additional securities.

Included in the Bassani family agreement was a

provision to cancel their remaining 5% obligation under the giveback agreement.

For details on this settlement agreements, see Item 1,

Note F above.

BION ENVIRONMENTAL TECHNOLOGIES, INC.

2 unchanged sentences

YEARS ENDED JUNE 30, 2025 AND 2024

During the year ended June 30, 2024, the Company entered

into subscription agreements to sell 28,589 units at a price of $ 1.60 , with each unit consisting of one share of the Company’s restricted

common stock and one half warrant to purchase one share of the Company’s restricted common stock for $ 2.40 per share with an expiry

date of June 30, 2024, and pursuant thereto, the Company issued 28,589 units for total proceeds of $ 45,742 .

On September 26, the Company’s

Board of Directors, due to a misunderstanding related to a private placement (memorandum of March 2023) and the securities sold thereunder,

adjusted the units sold in the offering by substituting 1,003,590 warrants with an exercise price of $ 1.25 per share for 501,795 previously

issued warrants effective October 1, 2023 .

During the year ended June 30, 2024, the Company

approved the modification of existing warrants held by brokers, which extended certain expiration dates.

The modifications resulted in

interest expense of $ 135,207 and non-cash compensation of $ 15,000 .

During the year ended June 30, 2024, the Company issued

282,500 warrants for the subscription agreements to sell 565,000 units at a price of $ 1.00 , with each unit consisting of one share of

the Company’s restricted common stock and one half warrant to purchase one share of the Company’s restricted common stock

for $ 1.25 per share with an expiry date of December 31, 2024, and pursuant thereto, the Company issued 565,000 units for total proceeds

of $ 565,000 .

During the year ended June 30, 2024, 38,000 warrants

were exercised to purchase 38,000 shares of the Company’s common stock at $ 0.75 per share for total proceeds of $ 28,500 .

During the year ended June 30, 2024, the Company issued

50,000 warrants to a consultant for services.

The warrants were issued for a total value of $ 5,000 .

During the year ended June 30, 2024, 223,625 warrants

Effective May 1, 2022, an entity affiliated with William

O’Neill (“O’Neill”) was issued 1,000,000 Incentive Warrants exercisable at $ 1.00 per share until April 30, 2026

of which up to 700,000 Incentive Warrants could be cancelled if O’Neill was not renewed at 13 months and/or fails to serve the entire

contract term thereafter.

These warrants each have a 75 % exercise price adjustment provision if the terms set forth therein are met.

warrants were cancelled as of May 31, 2024, resulted in non-cash compensation credit of $ ( 22,856 ) and venting expense of $ ( 11,918 ) for

the year ended June 30, 2024.

Stock options:

On April 7, 2022 the Company’s shareholders

approved the Bion Environmental Technologies, Inc.

2021 Equity Incentive Award Plan (the “ Equity Plan ”).

Plan provides for the issuance of options (and/or other securities) to purchase up to 30,000,000 shares of the Company’s

On April 7, 2022 the Company’s

shareholders approved the Bion Environmental Technologies, Inc.

2021 Equity Incentive Award Plan (the “ Equi ty Plan ”).

The Equity Plan provides for the issuance of options (and/or other securities) to purchase up to 30,000,000 shares of the Company’s

common stock.

4 unchanged sentences

No grants have been made pursuant to the Equity Plan as of the date of this report.

The Company’s 2006 Consolidated Incentive Plan,

as amended during the year ended June 30, 2021 (the “2006 Plan”), provides for the issuance of options (and/or other securities)

to purchase up to 36,000,000 shares of the Company’s common stock.

The Company’s 2006 Consolidated

Incentive Plan, as amended during the year ended June 30, 2021 (the “2006 Plan”), provides for the issuance of options (and/or

other securities) to purchase up to 36,000,000 shares of the Company’s common stock.

Terms of exercise and expiration of options/securities

3 unchanged sentences

and consultants who already has received grants pursuant to its terms).

On March 15, 2023, the Company granted 30,000 options

under the 2006 Plan to two consultants.

The options vested equally in thirds on March 20, 2023, June 20, 2023 and September 30, 2023.

On May 9, 2023, the Company granted 500,000 options

under the 2006 Plan to Bill O’Neill.

250,000 of these options vest on June 1, 2024 and 250,000 options vest on June 1, 2025;

options expire on June 30, 2026.

O’Neill resigned on May 31, 2024, as the options did not vest and were forfeited the Company reversed

all previous expenses of $ 178,179 .

The Company recorded compensation expense

1 unchanged sentence

and $( 18,314 )

for the year ended June 30, 2024 and 2023, respectively.

The Company granted nil 0 and 805,000

options for the year ended June 30, 2024 and 2023, respectively.

During the year ended June 30, 2024, the Company issued

3,661 shares of the Company’s common stock upon cashless exercise of outstanding options.

for the years ended June 30, 2025 and 2024, respectively.

The Company granted nil 0

and nil 0 options for the years ended June 30, 2025 and 2024, respectively.

On July 15, 2024 the Company

modified 3,806,600 options by extending the exercise date.

3,736,600 options held by employees and directors were extended two years from

December 31, 2024 to December 31, 2026.

70,000 options with a non-employee were extended one year from December 31, 2024 to December 31,

The company used the Black- Scholes valuation method and expensed $ 332,128 to non-cash compensation.

On September 15, 2025, a settlement was reached

Schafer to cancel the 2020 Adjusted Convertible Note and surrender options, effective on that date.

For details on the settlement

agreement, see Item 1, Note F above.

A summary of option activity under the 2006 Plan for years ended June

30, 2025 and 2024 is as follows:

Schedule of stockholders' equity

Outstanding at July 1, 2023

( 6,950,000 )

Outstanding at July 1, 2024

Outstanding at June 30, 2025

The total fair value of stock options that

vested during the years ended June 30, 2025 and 2024 was nil 0 and $ 2,730 , respectively.

As of June 30, 2025, the Company had no

unrecognized compensation cost related to stock options.

BION ENVIRONMENTAL TECHNOLOGIES, INC.

2 unchanged sentences

YEARS ENDED JUNE 30, 2025 AND 2024

A summary of option activity under the 2006 Plan for years ended

June 30, 2024 and 2023 is as follows:

Schedule of option activity under the plan

at July 1, 2022

Outstanding at July 1, 2023

( 6,950,000 )

Outstanding at June 30, 2024

The total fair value of stock options that vested

during the years ended June 30, 2024 and 2023 was $ 2,730 and $ 249,744 , respectively.

As of June 30, 2024, the Company had no unrecognized

compensation cost related to stock options.

RECEIVABLE - AFFILIATES :

As of June 30, 2024, the Company has three interest

bearing, secured promissory notes with an aggregate principal amount of $ 428,250 ($ 534,683 , including interest) from Bassani which were

received as consideration for purchases of warrants to purchase 5,565,000 shares, in aggregate, of the Company’s restricted common

stock, which warrants have an exercise price of $ 0.75 (with a 75% exercise price adjustment provision) and have expiry dates ranging from

December 31, 2024 (now extended to January 15, 2025) to December 31, 2025 (subject to extension rights) secured by portions of Bassani

Family Trust’s 2020 Convertible Obligation and Bassani Family Trust’s September 2015 Convertible Notes.

The secured promissory

notes are payable January 15, 2025.

As of June 30, 2024, the Company has an interest bearing,

secured promissory note for $ 30,000 ($ 37,085 including interest) from Smith as consideration to purchase warrants to purchase 300,000

shares of the Company’s restricted common stock, which warrants are exercisable at $ 0.60 (with a 75% exercise price adjustment provision)

and had expiry dates of December 31, 2024 (now extended to January 15, 2025).

The promissory note bears interest at 4 % per annum and is

secured by $ 30,000 original principal ($ 37,886 including interest) of Smith’s 2020 Convertible Obligations.

As of June 30, 2025, the

Company has three interest bearing, secured promissory notes with an aggregate principal amount of $ 428,250 ($ 551,766 , including interest)

from Bassani which were received as consideration for purchases of warrants to purchase 5,565,000 shares, in aggregate, of the Company’s

restricted common stock, which warrants have an exercise price of $ 0.75 (with a 75% exercise price adjustment provision) and have expiry

dates ranging from December 31, 2024 (extended to July 15, 2025) to December 31, 2025 (subject to extension rights) secured by portions

of Bassani Family Trust’s 2020 Convertible Obligation and Bassani Family Trust’s September 2015 Convertible Notes.

promissory notes are payable July 15, 2025 (extended to September 15, 2025).

As of June 30, 2025, the Company has an interest

bearing, secured promissory note for $ 30,000 ($ 38,282 including interest) from Smith as consideration to purchase warrants to purchase

300,000 shares of the Company’s restricted common stock, which warrants are exercisable at $ 0.60 (with a 75% exercise price adjustment

provision) and had expiry dates of December 31, 2024 (extended to September 15, 2025).

The promissory note bears interest at 4 % per annum

and is secured by $ 30,000 original principal ($ 38,282 including interest) of Smith’s 2020 Convertible Obligations.

The secured promissory

note is payable on January 15, 2025.

As of June 30, 2024, the Company has an interest bearing,

secured promissory note for $ 19,400 ($ 24,549 including interest) from Scott as consideration to purchase warrants to purchase 485,000

shares of the Company’s restricted common stock, which warrants are exercisable at $ 0.75 (with a 90% exercise price adjustment provision)

and have expiry dates of December 31, 2024 (now extended to December 31, 2026).

The promissory note bears interest at 4 % per annum and

is secured by the warrants (which 400,000 were gifted subject to the security interest).

As of June 30, 2024, the Company has one interest

bearing, secured promissory note with an aggregate principal amount of $ 27,000 ($ 34,166 including interest) from one employee as consideration

to acquire warrants to purchase 570,000 shares of the Company’s restricted common stock, which warrants are exercisable at $ 0.75

(with a 90% exercise price adjustment provision) and have expiry dates of December 31, 2024 (now extended to December

(The promissory note bears interest at 4 % per annum and is secured by a perfected security interest in the warrants, and are

payable on December 31, 2026).

These secured promissory notes are recorded

as “Subscription receivable—affiliates” on the Company’s balance sheet pending payment.

note is payable July 15, 2025 (extended to September 15, 2025).

As of June 30, 2025, the

Company has an interest bearing, secured promissory note for $ 19,400 ($ 25,323 including interest) from Scott as consideration to purchase

warrants to purchase 485,000 shares of the Company’s restricted common stock, which warrants are exercisable at $ 0.75 (with a 90%

exercise price adjustment provision) and have expiry dates of December 31, 2024 (extended to December 31, 2026).

The promissory note bears

interest at 4 % per annum and is secured by the warrants (which 400,000 were gifted subject to the security interest).

As of June 30, 2025, the Company

has one interest bearing, secured promissory note with an aggregate principal amount of $ 27,000 ($ 35,244 including interest) from one

employee as consideration to acquire warrants to purchase 570,000 shares of the Company’s restricted common stock, which warrants

are exercisable at $ 0.75 (with a 90% exercise price adjustment provision) and have expiry dates of December 31, 2024 (now extended to

December 31, 2026).

The promissory note bears interest at 4 % per annum and is secured by a perfected security interest in the warrants,

and are payable on December 31, 2026.

These secured

promissory notes are recorded as “Subscription receivable—affiliates” on the Company’s balance sheet pending payment .

BION ENVIRONMENTAL TECHNOLOGIES, INC.

3 unchanged sentences

AND CONTINGENCIES :

Employment/Consulting (and related) agreements:

Stephen Craig Scott (“Scott”) was appointed

interim CEO effective June 1, 2024.

Scott had previously been working with the Company as an employee/consultant since 1993 in various

positions including Director of Communications, SVP- Capital Markets and Head of Head of Business Development.

On October 25, 2023, Scott

entered into an agreement with the Company which included provisions for a monthly salary of $ 14,000 of which $ 2,000 is deferred.

the year ended June 30, 2024, Scott deferred substantial portions of his monthly salary to help the Company conserve cash.

ended June 30, 2024 and 2023, Scott was paid $ 64,000 and $ 144,000 respectively.

William O’Neill

(“O’Neill”) was hired as the Company’s Chief Executive Officer (“CEO”) effective May 1, 2022 and he

elected not to complete his contractual term and ended his service with the Company effective May 31, 2024.

O’Neill had previously

been working with the Company as a consultant and had been employed by the Company as its CEO during 2010-2011.

(Upon the hiring

of O’Neill, Bassani, CEO of the Company from 2011, assumed the position of COO while retaining existing operational management responsibilities

and working with O’Neill on ‘commercialization’ of the Company’s technology and work related to JVs (and other

transactions) based on the Company’s Gen3 Technology and related matters until his recent death.

Bassani’s compensation arrangements

with the Company were not altered in the context of the change of positions.) The Company and O’Neill entered into a thirty-seven

(37) month employment agreement with compensation of $ 25,000 cash and $ 10,000 deferred compensation per month.

The cash payment

is paid $ 12,500 to O’Neill and $12,500 to an entity affiliated with O’Neill.

An entity affiliated with O’Neill

was issued 1,000,000 Incentive Warrants exercisable at $1.00 per share (a 75% exercise price adjustment provision if the terms set

forth therein are met) until April 30, 2026 of which up to 304,743 Incentive Warrants have been cancelled due to O’Neill’s

Employment/Consulting (and related)

Stephen Craig Scott (“Scott”)

was appointed interim CEO effective June 1, 2024.

Scott had previously been working with the Company as an employee/consultant since

1993 in various positions including Director of Communications, SVP- Capital Markets and Head of Business Development.

25, 2023, Scott entered into an agreement with the Company which included provisions for a monthly salary of $ 14,000

almost all of which Scott deferred to help the Company conserve cash.

For the years ended June 30, 2025 and 2024, deferred

compensation was $ 163,000

and $ 1 04,000

and Scott was paid $ 5,000

respectively.

William O’Neill (“O’Neill”)

was hired as the Company’s Chief Executive Officer (“CEO”) effective May 1, 2022 and he elected not to complete his

contractual term and ended his service with the Company effective May 31, 2024.

O’Neill had previously been working with the Company

as a consultant and had been employed by the Company as its CEO during 2010-2011.

(Upon the hiring of O’Neill, Bassani, CEO of the

Company from 2011, assumed the position of COO while retaining existing operational management responsibilities and working with O’Neill

on ‘commercialization’ of the Company’s technology and work related to JVs (and other transactions) based on the Company’s

Gen3 Technology and related matters until his recent death.

Bassani’s compensation arrangements with the Company were not altered

in the context of the change of positions.) The Company and O’Neill entered into a thirty- seven (37) month employment agreement

with compensation of $ 25,000 cash and $ 10,000 deferred compensation per month.

The cash payment was paid

$ 12,500 to O’Neill and $12,500 to an entity affiliated with O’Neill.

An entity affiliated with O’Neill was issued 1,000,000

Incentive Warrants exercisable at $1.00 per share (a 75% exercise price adjustment provision

if the terms set forth therein are met) until April 30, 2026 of which up to 304,743 Incentive Warrants have been cancelled due to O’Neill’s

failure to serve the entire contract term.

O’Neill was not paid, from October 31, 2023 until his resignation, deferring part

or all of his cash compensation due to the Company’s financial crisis described in multiple places herein, and $ 157,500 was accrued

O’Neill was not paid, from October 31, 2023 until his resignation, deferring part or

all of his cash compensation due to the Company’s financial crisis described in multiple places herein, and $ 157,500 was accrued

during that period.

3 unchanged sentences

On October 10, 2016, the Company approved a month-to-month contract

extension with Smith which included provisions for i) a monthly salary of $ 18,000 (deferred until the Board of Directors re-instated

cash payments to all employees and consultants who are deferring compensation), ii) the right to convert up to $ 300,000 of his deferred

compensation, at his sole election, at $ 0.75 per share, until December 31, 2024, and iii) the right to convert his deferred

compensation in whole or in part, at his sole election, at any time in any amount at “market” or into securities sold in the

Company’s current/most recent private offering at the price of such offering to third parties.

Smith agreed effective July 29, 2018

to continue to serve the Company under the same basic terms on a month-to-month basis.

On May 1, 2022 Smith’s compensation

was increased to $ 25,000 per month of which $5,000 per month was deferred.

Smith deferred substantial portions of his monthly compensation

to help the Company conserve cash.

For the years ended June 30, 2024 and 2023, Smith was paid $ 20,000 and $ 200,000 , respectively, of cash

extension with Smith which included provisions for i) a monthly salary of $ 18,000 (deferred until the Board of Directors re-instated cash

payments to all employees and consultants who are deferring compensation), ii) the right to convert up to $ 300,000 of his deferred compensation,

at his sole election, at $ 0.75 per share, until December 31, 2024, and iii) the right to

convert his deferred compensation in whole or in part, at his sole election, at any time in any amount at “market” or into

securities sold in the Company’s current/most recent private offering at the price of such offering to third parties.

effective July 29, 2018 to continue to serve the Company under the same basic terms on a month-to-month basis.

On May 1, 2022 Smith’s

compensation was increased to $ 25,000 per month of which $5,000 per month was deferred.

Smith deferred substantial portions of his monthly

compensation to help the Company conserve cash.

For the years ended June 30, 2025 and 2024, Smith was paid nil and $ 20,000 , respectively,

of cash compensation.

Smith was paid, deferring part or all of his cash compensation, since October 31, 2023, due to the Company’s

financial crisis described in multiple places herein and $ 135,000 has been accrued during that period until June 30, 2025.

From no later than March 31, 2005, the

Company had various agreements with Dominic Bassani (and/or Brightcap which provided his services during some of the years) (NOTE:

Dominic Bassani passed away on November 11, 2023.) who was serving as the Company’s Chief Operating Officer

(‘COO’) at the time of his passing and formerly served as the Company’s Chief Executive Officer

(‘CEO’) for the prior decade (any reference to Brightcap or Bassani for all purposes are referring to the same

The Board appointed Bassani as the Company's CEO effective May 13, 2011.

On February 10, 2015, the Company executed an

Extension Agreement with Bassani pursuant to which Bassani extended the term of his service to the Company to December 31, 2017

(with the Company having an option to extend the term an additional six months.) Pursuant to the Extension Agreement, Bassani

continued to defer his cash compensation ($ 31,000

per month) until the Board of Directors re-instated cash payments to all employees and consultants who were deferring their

compensation.

Smith was paid, deferring part or all of his cash compensation, since October 31, 2023, due to the Company’s financial

crisis described in multiple places herein and $ 130,000 has been accrued during that period until June 30, 2024.

From no later than March 31, 2005, the Company had

various agreements with Dominic Bassani (and/or Brightcap which provided his services during some of the years) (NOTE:

Dominic Bassani

passed away on November 11, 2023.

) who was serving as the Company’s Chief Operating Officer (‘COO’) at the time

of his passing and formerly served as the Company’s Chief Executive Officer (‘CEO’) for the prior decade (any reference

to Brightcap or Bassani for all purposes are referring to the same individual).

The Board appointed Bassani as the Company's CEO effective

May 13, 2011.

On February 10, 2015, the Company executed an Extension Agreement with Bassani pursuant to which Bassani extended the term

of his service to the Company to December 31, 2017 (with the Company having an option to extend the term an additional six months.) Pursuant

to the Extension Agreement, Bassani continued to defer his cash compensation ($ 31,000 per month) until the Board of Directors re-instated

cash payments to all employees and consultants who were deferring their compensation.

During October 2016 Bassani was granted the right

to convert up to $ 125,000 of his deferred compensation, at his sole election, at $ 0.75 per share, until March 15, 2018 (which

was expanded on April 27, 2017, to the right to convert up to $ 300,000 of his deferred compensation, at his sole election, at $ 0.75 per

share, until June 30, 2024 (including extensions).

During February 2018, the Company agreed to the material terms for a binding two-year

extension agreement for Bassani’s services as CEO.

Bassani’s salary remained $ 31,000 per month, which accrued in part

during periods when the Board determined there was not adequate cash available.

Additionally, the Company agreed to pay or accrue $ 2,000 per

month to be applied to life insurance premiums (which sums were accrued as liabilities).

On August 1, 2018, in the context of extending

his agreement to provide services to the Company on a full-time basis through December 31, 2022) plus 2 years after that on a part-time

basis, the Company received an interest bearing secured promissory note for $ 300,000 from Bassani as consideration to purchase warrants

to purchase 3,000,000 shares of the Company’s restricted common stock, which warrants are exercisable at $0.60 and have

expiry dates of June 30, 2025.

The promissory note is secured by a portion of Bassani’s 2020 Convertible Obligations and, as of

June 30, 2024, the principal and accrued interest was $ 373,099 .

For the years ended June 2024 and 2023, Brightcap was paid $ 20,000 and

During October 2016 Bassani was granted the right to convert up to $ 125,000

of his deferred compensation, at his sole election, at $ 0.75

per share, until March 15, 2018 (which was expanded on April 27, 2017, to the right to convert up to $ 300,000

of his deferred compensation, at his sole election, at $ 0.75

per share, until June 30, 2024 (including extensions).

During February 2018, the Company agreed to the material terms for a binding

two-year extension agreement for Bassani’s services as CEO.

Bassani’s salary remained $ 31,000

per month, which accrued in part during periods when the Board determined there was not adequate cash available.

Additionally, the

Company agreed to pay or accrue $ 2,000

per month to be applied to life insurance premiums (which sums were accrued as liabilities).

On August 1, 2018, in the context of

extending his agreement to provide services to the Company on a full-time basis through December 31, 2022) plus 2 years after that

on a part-time basis, the Company received an interest bearing secured promissory note for $ 300,000

from Bassani as consideration to purchase warrants to purchase 3,000,000

shares of the Company’s restricted common stock, which warrants are exercisable at $0.60 and have expiry dates of July 15, 2025 (extended to September 15, 2025).

The promissory note is secured by a portion of Bassani’s 2020 Convertible

Obligations and, as of June 30, 2025, the principal and accrued interest was $ 386,677 .

For the years ended June 30, 2025 and 2024, Brightcap was paid nil 0

and $ 20,000 ,

respectively, of cash compensation.

Effective April 1, 2024 the Company entered into two

material definitive agreements regarding voluntary surrender for cancellation of securities of the Company (and related matters) by:

members of the family of Dominic Bassani, recently deceased former Chief Executive Officer and (with his family) the Company’s largest

shareholder (collectively “Bassani Family”)(see Exhibit 10.1)(“Bassani Family Agreement”), and b) Mark A.

President of the Company and a director (“MAS”)(see Exhibit 10.2)(“MAS Agreement”), as described in multiple places

BION ENVIRONMENTAL TECHNOLOGIES, INC.

2 unchanged sentences

YEARS ENDED JUNE 30, 2025 AND 2024

Initial Project:

January 28, 2022 Bion Environmental Technologies, Inc.

(‘Bion’), on behalf of Bion 3G1 LLC (‘3G1’), a wholly-owned

subsidiary, entered into a Purchase Order Agreement with Buflovak and Hebeler Process Solutions (collectively ‘Buflovak’)

in the amount of $ 2,665,500 (and made the initial 25 % payment ($ 666,375 ) for the core of the ‘Bion System’ portion (without

the crystallization modules which will be ordered and fabricated pursuant to subsequent agreements) of the previously announced 3G Tech

Effective April 1, 2024 the

Company entered into two material definitive agreements regarding voluntary surrender for cancellation of securities of the Company (and

related matters) by:

a) members of the family of Dominic Bassani, recently deceased former Chief Executive Officer and (with his family)

the Company’s largest shareholder (collectively “Bassani Family”)(“Bassani Family Agreement”), and b) Mark

Smith, recently retired President of the Company and a director (“MAS”) (“MAS Agreement”), as described in

multiple places herein.

Initial Project:

This Purchase Order encompassed the core of Bion’s 3G Technology.

The Company received progress billing in March

2022 and June 2022 for the second and third 25 % installments, both of which have been paid as of the filing date.

On January 17, 2023

the Company received an invoice from Buflovak for $ 533,100 which was paid on March 1, 2023 and on April 24, 2023 the Company received

an invoice from Buflovak for $ 83,275 which was paid on May 2, 2023 bringing the aggregate payments to $ 2,615,500 as of the date of this

On July 26, 2023 the Company received the final invoice for $ 50,000 , $ 16,666 was

paid on January 2, 2024 leaving a balance of $ 33,334 .

In addition to the Purchase Order, through June 30,

2024 the Company has incurred additional costs of $ 6,794,925 on the Initial Project for capitalized interest and costs, non-cash compensation,

equipment and consulting fees.

On January 28, 2022 Bion

Environmental Technologies, Inc.

(‘Bion’), on behalf of Bion 3G1 LLC (‘3G1’), a wholly-owned subsidiary, entered

into a Purchase Order Agreement with Buflovak and Hebeler Process Solutions (collectively ‘Buflovak’) in the amount of $ 2,665,500

(and made the initial 25 % payment ($ 666,375 ) for the core of the ‘Bion System’ portion (without the crystallization modules

which will be ordered and fabricated pursuant to subsequent agreements) of the previously announced 3G Tech Initial Project.

This Purchase

Order encompassed the core of Bion’s 3G Technology.

The Company received progress billing in March 2022 and June 2022 for the second

and third 25 % installments, both of which have been paid as of the filing date.

On January 17, 2023 the Company received an invoice from

Buflovak for $ 533,100 which was paid on March 1, 2023 and on April 24, 2023 the Company received an invoice from Buflovak for $ 83,275

which was paid on May 2, 2023 bringing the aggregate payments to $ 2,615,500 as of the date of this filing.

On July 26, 2023 the Company

received the final invoice for $ 50,000 , $ 16,666 was paid on January 2, 2024 leaving a balance of $ 33,334 .

In addition to the Purchase

Order, through June 30, 2025 the Company has incurred additional costs of $ 6,794,925 on the Initial Project for capitalized interest and

costs, non-cash compensation, equipment and consulting fees.

$ 7,371,371 has been paid and $ 1,658,469 has been billed and not yet paid.

has worked with the Company on design and testing of its 3G Tech over several years.

The basic design for the Initial Project’s

Bion System is complete, fabrication and delivery of equipment from Buflovak from the Purchase Order Agreement has been largely completed

and assembly/construction is in process.

3G1 is working in concert with Integrated Engineering Services, the primary site engineering

firm for the facility, on the integration of all project components/modules at the Initial Project site.

Additional agreements have been

entered into various professional services providers (engineers, surveyors, utilities, etc.) for work related to the Initial Project.

The Company has incurred costs of $ 8,406,434 on t he Initial Project, not including capitalized

labor and interest.

Management previously believed that the Initial Project

had reached the point where it could be appropriately deemed ‘placed in service’ at January 1, 2024.

However, discussions

with the key technical and engineering personnel involved at the Initial Project during the recently concluded quarter convinced management

that such a characterization was premature as some key modules had not yet been completed and/or fully tested.

Additionally, due to some

recent equipment break-downs, the Initial Project was in maintenance mode at that time (and not conducting operations), while the Company

awaited required replacement parts and subsequent repairs.

This process was slowed by the Company’s ongoing difficulties in raising

needed funds for its activities.

The Company’s Board of Directors re-evaluated the classification/status of the Initial Project

as part of the Company’s annual review process and determined that the Initial Project had been ‘placed in service’

Buflovak (a division of Hebeler

Process Solutions) has worked with the Company on design and testing of its 3G Tech over several years.

The basic design for the Initial

Project’s ARS System, fabrication and delivery of equipment from Buflovak, and assembly/construction were completed in July 2023,

followed by system startup.

Steady-state operations were achieved in September 2023, after which time we began optimization of the ARS

in preparation for providing final design for full-scale systems, as well as demonstrating its performance and economics for an independent

engineering report.

Due to delays and interruptions in our ability to operate the system (as below), those efforts have continued to date.

We worked in concert with Integrated Engineering Services, the primary site engineering firm for the facility, on the integration of all

project components/modules at the Initial Project site during assembly/construction.

Additional agreements were entered into with various

professional services providers (engineers, surveyors, utilities, etc.) for work related to the Initial Project.

The Company has incurred

costs of $ 8,406,434 on the Initial Project, not including capitalized labor and interest.

Management previously believed

that the Initial Project had reached the point where it could be appropriately deemed ‘placed in service’ at January 1, 2024.

However, discussions with the key technical and engineering personnel involved at the Initial Project during the recently concluded quarter

convinced management that such a characterization was premature as some key modules had not yet been completed and/or fully tested.

Additionally,

due to some recent equipment break-downs, the Initial Project was in maintenance mode at that time (and not conducting operations), while

the Company awaited required replacement parts and subsequent repairs.

This process was slowed by the Company’s ongoing difficulties

in raising needed funds for its activities.

The Company’s Board of Directors re-evaluated the classification/status of the Initial

Project as part of the Company’s annual review process and determined that the Initial Project had been ‘placed in service’

at the June 30, 2024, fiscal year end.

2 unchanged sentences

because the Initial Project was recently reclassified as largely a research & development facility and is located on land subject

to a short term lease (as described above in Item 7, Management’s Discussion and Analysis).

to a short term lease (as described below in Item 2, Management’s Discussion and Analysis).

As a result, a large ‘one time/non-recurring’

1 unchanged sentence

equity to ($ 5,808,501 ) and resulted in a loss of $ 11,691,115 for the 2024 fiscal year.

BION ENVIRONMENTAL TECHNOLOGIES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED JUNE 30, 2024 AND 2023

The Company entered into an agreement on September

23, 2021, to lease approximately four acres of land near Fair Oaks, Indiana, for the development site of its Initial Project.

The future minimum lease payment under noncancelable

operating lease with terms greater than one year as of June 30, 2024:

Schedule of future minimum lease payment

From July 2024 to December 2024

Undiscounted cash flow

Less imputed interest

The weighted average remaining lease term and discounted

rate related to the Company’s lease liability as of June 30, 2024 were 0.5 years and 10%, respectively.

The Company’s lease

discount rate is generally based on the estimates of its incremental borrowing rate as the discount rates implicit in the Company’s

lease cannot be readily determined.

The Company has not made lease payments

since October 16, 2023 and owes $ 50,000 in lease payments at June 30, 2024.

Litigation (and related matters):

1) Convertible Bridge Loan/Default

On September 28, 2023, in order to partially

mitigate the problems discussed in the going concern, the Company entered into an agreement for a $ 1,500,000

bridge loan and executed documents including a convertible promissory note (“Note”) and a binding subscription agreement

(“Subscription”) (collectively the Note and the Subscription are the “Bridge Loan Agreements”) with SEB LLC,

a non-affiliated party (“Lender”).

The Bridge Loan Agreements require the Lender to loan the Company $ 1,500,000

in six monthly tranches of $ 250,000

commencing October 2023.

All sums advanced under the Bridge Loan Agreements (and accrued interest thereon) would due and payable

(with interest accrued at 9 %

per annum) on October 1, 2024 if not previously converted into securities of the Company.

The Note is convertible at $ 1.00

per unit, at the sole election of the Lender, into units consisting of one share of the Company’s common stock and a warrant

to purchase one half share.

The initial $ 250,000

tranche was received by the Company on October 5, 2023.

However, no further funds were received by the Company from the Lender.

During early November 2023 the Lender informed the Company verbally that it did not intend to fulfill its obligations pursuant to

the Bridge Loan Agreements and since such time the Lender has been in default (“Default”).

On May 10, 2024 the Company

received $150,000 from affiliates of the Bridge Loan Lender on terms not yet finalized and included in an agreement.

were received in the context of negotiations/discussions regarding a potential larger investment by affiliates and/or associates of

the Lender but no further funds were received and the larger transaction was never completed.

The funds were used primarily to

re-initiate operations at the Initial Project.

The Default (which is continuing) has created substantial problems for and materially

damaged the Company and rendered the Company unable to meet its current creditor obligations on a timely basis.

The Company is

currently evaluating its rights regarding the Default by the Lender.

This situation has contributed to the substantial increase in

the Company’s ‘Current Liabilities’ including ‘accounts payable’ over recent periods.

See Consolidated

Financial Statements and ‘Management’s Discussion and Analysis’.

The Company has engaged in discussion/negotiation

with its larger creditors (including its largest creditor--- the primary contractor on the Initial Project) but has been unable to

reach agreements regarding payments due to the uncertainty as to if, when and how much funding the Company will be able to raise in

future periods.

As a result, the Company’s largest creditor---the general contractor for the Initial Project --- has filed a

mechanics lien in Indiana (and its largest sub-contractor has sent notices related to its intention to file a mechanics lien) and

other creditors are threatening to commence litigation and other creditors are threatening to commence litigation and/or

repossess/remove leased equipment).

2) Creditor Matters

As is described in the Company’s Consolidated

Financial Statements included herein and discussed in the Notes to the Consolidated Financial Statements, the Company has had on-going

difficulties raising needed funds for its operations/activities over the past 2 years which has rendered the Company unable to meet its

current creditor obligations on a timely basis.

This situation includes a substantial increase in the Company’s ‘Current Liabilities’

including ‘accounts payable’ over recent periods.

The Company has engaged in discussion/negotiation with its larger creditors

(including its largest creditor--- the primary contractor on the Initial Project) but has been unable to reach agreements regarding payments

due to the uncertainty as to if, when and how much funding the Company will be able to raise in future periods.

As a result, the Company’s

largest creditor---the general contractor for the Initial Project --- has filed a mechanics in Indiana (and its largest sub-contractor

has sent notices related to its intention to file a mechanics lien) and other creditors are threatening to commence litigation and/or

repossess/remove leased equipment.

The Company currently is not involved in any other material litigation

or similar events.

ended December 31, 2024 and there is an agreement to extend month to month at the same rate.

The Company has not made consistent lease payments

since October 16, 2023 and has made no payments since February 24, 2025.

The Company owes $ 106,250 in lease payments at June 30, 2025.

BION ENVIRONMENTAL TECHNOLOGIES, INC.

2 unchanged sentences

YEARS ENDED JUNE 30, 2025 AND 2024

Litigation (and related matters):

On April 16, 2025, the Company

was served a summons by Hamstra Builders, Inc.

(“Hamstra”) along with three other defendants:

Bion Technologies, Inc.

(“Biontech”),

Bion 3G-1, LLC (“3G-1”), both entities of Bion Environmental Technologies, Inc., and North Prairie Holdings, LLC (‘NPHLLC”)

the property lessor.

The Hamstra suit is related to the Notice of Intent to file a Mechanic’s Lien, that was filed April 16, 2024,

and has been disclosed in our public filings since that date.

Bion has retained counsel in Indiana to represent the company in these actions.

Hamstra is seeking to recover $1,494,513 in unpaid invoices related to the construction of Bion’s Ammonia Recovery System at Fair

Oaks, Indiana.

This sum includes $653,915 owed to Dilling Group, Inc., a subcontractor of Hamstra.

Dilling filed suit to recover that

amount on March 31, 2025, which was disclosed in Bion’s 8-K, dated April 7, 2025.

These amounts are included in accounts payable

and accrued expenses.

The Company currently is not involved in any other material

litigation or similar events.

The reconciliation between the expected federal

35 unchanged sentences

The 401(k) is open to all employees over 21 years of age and no service requirement is necessary.

The Company discontinued the 401K plan as of July 7, 2025.

BION ENVIRONMENTAL TECHNOLOGIES, INC.

2 unchanged sentences

YEARS ENDED JUNE 30, 2025 AND 2024

As is described in the Company’s Financial Statements

included herein and discussed above in the Notes to the Financial Statements above and in Item 2, Management’s Discussion and Analysis,

the Company has had on-going difficulties raising needed funds for its operations/activities over the past 2 years which has rendered

the Company unable to meet its current creditor obligations on a timely basis.

The Company has engaged in discussion/negotiation with

its larger creditors (including its largest creditor--- the primary contractor on the Initial Project) but has been unable to reach agreements

regarding payments due to the uncertainty as to if, when, and how much funding the Company will be able to raise in future periods.

a result, the Company’s largest creditor---the general contractor for the Initial Project --- has filed a mechanics in Indiana (and

its largest sub-contractor has sent notices related to its intention to file a mechanics lien), other creditors are threatening to commence

litigation and/or repossess/remove leased equipment and the Company is behind on its Lease payments related to the site of the Initial

On September 5, 2024, three members of the LLC (Subsequent Events, Aug 23, 2024, below) met with representatives of two of the

largest creditors:

the prime contractor and the property lessor.

Discussions and ultimate resolution are ongoing and subject to Bion’s

ability to raise capital in a timely manner.

On July 15, 2024, the Company issued 9,231 shares

of the Company’s common stock to non-affiliate consultants for services.

The shares were issued at .65 per share pursuant to the

terms of the applicable for a value of $ 6,000 for the services provided.

Effective July 31, 2024, Mark A.

Smith, Bion’s

President, CFO, and General Counsel retired, as was planned for some time.

Smith was responsible for a wide range of duties and his

previous roles will need to be filled over the next several months, both by existing staff and new associates.

On August 23, 2024, Bion announced that three affiliates

of the Company (Greg Schoener, Interim COO & Director;

Turk Stovall, Director;

Bob Weerts, Director) and two shareholders (one of

whom is the brother of Greg Schoener) have agreed to advance to the Company, through a newly formed LLC (LLC), up to $ 500,000 in consideration

of a secured convertible promissory note.

The note instrument and agreements have not been executed at this time because terms and other

details have not been finalized yet;

however, the group has begun advancing money to the Company.

As of the date of the filing of this

report, the aggregate sum of $ 201,564 to the Company together with express directions on what items were to be paid with such funds.

a final agreement is executed, it will be attached as an exhibit to a Form 8-K.

Pursuant to the requirements of Section 13 or 15(d)

of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned thereunder

duly authorized.

During August and September, the Company extended

warrants with expiration dates of July 15, 2025 to August 15, 2025 and September 15, 2025.

On July 24, 2025, the Company entered into a Forbearance Agreement

with Bion BLG, LLC, (effective July 15, 2025) extending the maturity date of the BLG Note to January 15, 2026 (attached as exhibit).

agreement was ratified by Bion’s Board on July 24, 2025.

Under the terms of the Forbearance Agreement, the amounts outstanding under

the Note will continue to bear interest at a rate of 9 % per annum.

Bion agreed to a new formula to determine BLG’s obligation for

up to $ 100,000 in legal costs related to litigation over delinquent payment for construction costs incurred at Bion’s demonstration

facility near Fair Oaks, IN (see Bion’s Forms 8-K, dated April 17, May 30 and July 20, 2025).

Bion BLG, LLC, also extended their

agreement to share their collateral with investors in the three prior Shareholder Note offerings, with investors participating in a new

offering, dated July 25, 2025

Effective October 15, 2024, the Company entered

into an Agreement with BLG, LLC, to purchase a Convertible Promissory Note in the principal amount of up to $ 500,000 (See Bion’s

Form 8-K, dated October 24, 2024).

At that time, BLG, LLC, consisted of three affiliates of the Company (Directors Greg Schoener (also

Interim COO), Turk Stovall, and Bob Weerts) and two shareholders (one of whom is the brother of Greg Schoener).

BLG membership is currently

the same, but Bion accepted Turk Stovall’s resignation as a Director, effective May 30, 2025.

Amounts outstanding under the original

BLG Note bore interest at a rate of 7.5 % per annum through the maturity date of the Note, which was April 15, 2025.

The Note is secured

by the Company’s Intellectual Property (IP)/patents and it will convert into securities in the Company at the terms of a later capital

raise (or other source of funding) in excess of $3.0 million, that had to be completed within six (6) months, and other terms as defined

in the Note and Security Agreements (attached as exhibits).

Effective May 29, 2025, the Company entered

into a Forbearance Agreement with Bion BLG, LLC, extending the maturity date of the BLG Note to July 15, 2025 (See Bion’s Form 8-K,

dated May 30, 2025).

Under the terms of the Forbearance Agreement, the amounts outstanding under the Note began to bear interest at a

rate of 9 % per annum.

During July 2025, the Company raised $ 35,000

under the May 2025 convertible note.

On August 11, 2025, the Company entered into

a demand note with 10 % interest with a current board member of $ 24,728 .

During August and September 2025, the Company

entered into July 2025 Convertible Notes with five individuals.

The July 2025 Convertible Notes bear interest at 7.5 % per annum, have

maturity dates of December 31, 2025 .

The July Notes will convert into Units in the Company at the terms of a later capital raise, in which

the Company crosses the threshold of $3 million aggregate capital raised, including proceeds from the Shareholder Note offerings.

Effective September 15, 2025, pending formal

documentation and execution, two affiliates of the Company (Danielle Lominy and Christopher Parlow, family members of the late Dominic

Bassani, Bion’s former CEO), and three non-affiliates of the Company (Dominic Bassani’s spouse, Mark A.

Smith, previously

a Director and President, and Edward Schafer, previously a Director) (referred to hereinafter collectively as ‘Holders’) have

each individually agreed to a settlement (“Settlement Agreements”) that will simplify Bion’s capital structure and substantially

reduce the number of Fully Diluted Shares.

In consideration of the cancellation of various obligations and security instruments held by

the Holders, including without limitation deferred compensation, convertible notes, warrants, and options, the Holders (as a whole) will

receive, in aggregate, 8,101,746 shares of common stock.

If all the instruments they forfeited had been converted or exercised, it could

have increased the Company’s shares outstanding by 22,498,405.

The transactions represent a net reduction in fully diluted shares

of 14,369,659 and an increase in outstanding shares of 8,101,746 (approximately).

The shares will be issued by January 15, 2026, or earlier

upon the election of the individual Holders.

When the formal agreements are executed and ratified by the Board, they will be attached

as an exhibit to a Form 8-K.

On September 15, 2025 the maturity date for two

of the 2015 Convertible Notes was extended to September 15, 2027.

Effective September 26, 2025, Bob Weertz, a Bion

Director, was placed on an indefinite leave of absence for personal reasons

Pursuant to the requirements of Section 13 or

15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned

thereunder duly authorized.

BION ENVIRONMENTAL TECHNOLOGIES, INC.

2 unchanged sentences

Stephen Craig Scott Chief Executive Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this

Report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated:

Pursuant to the requirements of the Securities

Exchange Act of 1934, this Report has been signed below by the following persons on behalf of the Registrant and in the capacities and

on the dates indicated:

/s/ Stephen Craig Scott

Chief Executive Officer

4 unchanged sentences

September 29, 2025

/s/ Stephen Posner

September 29, 2025

Edward Schafer

Stephen Posner

/s/ Greg Schoener

September 29, 2025

Greg Schoener

/s/ Robert Weerts

1 unchanged sentence

Robert Weerts

/s/ Turk Stoval

September 30, 2024

/s/ Salvatore

/s/ Salvatore Zizza

September 29, 2025

1 unchanged sentence

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 9A. Controls and Procedures