BION ENVIRONMENTAL TECHNOLOGIES INC

Previous wording

A:The Company is not currently generating any significant revenues. Further, the Company’s anticipated revenues, if any, from existing Projects, JVs and proposed Projects will not be sufficient to meet the Company’s anticipated operational and capital expenditure needs for many years. Current liabilities were approximately $6.3 million at December 31, 2025 which represents a decrease of approximately $852,000 from June 30, 2025 (largely due to Settlement Agreements detailed inP below). Similarly, the Company’s cash on hand increased from approximately $4,400 to approximately $6,300 over the same period. The Company has faced extreme difficulty obtaining needed funding during the entire 2025 fiscal year, which has continued throughout the six months of the current fiscal year to date.

Current wording

A:The Company is not currently generating any significant revenues. Further, the Company’s anticipated revenues, if any, from existing Projects, JVs and proposed Projects will not be sufficient to meet the Company’s anticipated operational and capital expenditure needs for many years. Current liabilities were approximately $6.7 million at March 31, 2026 which represents a decrease of approximately $463,000 from June 30, 2025 (largely due to Settlement Agreements detailed inP below). The Company’s cash on hand increased from approximately $4,400 to approximately $44,000 over the same period. The Company has faced extreme difficulty obtaining needed funding during the entire 2025 fiscal year, which has continued throughout the nine months of the current fiscal year to date.

Previous wording

**I:**To help alleviate short-term cash needs for continued operations, in August, three affiliates of the Company (Greg Schoener, Interim COO & Director; Turk Stovall, Director (at that time); Bob Weerts, (now-deceased former 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 provided 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 was April 15, 2025. As of the filing date, BLG has advanced $449,463, including accrued interest of $41,728. 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 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.

Current wording

**I:**To help alleviate short-term cash needs for continued operations, in August, three affiliates of the Company (Greg Schoener, Interim COO & Director; Turk Stovall, Director (at that time); Bob Weerts, (now-deceased former 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 provided 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 was April 15, 2025. As of the filing date, BLG has advanced $466,521, including accrued interest of $50,786. 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 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.

Previous wording

Since January 2026, the Bion Loan Group (BLG) has agreed to several forbearance agreements, extending the maturity date of their note. The note now bears interest at 9%, along with other minor modifications detailed above inNote 5. Notes Payable: Note payable - related party andSubsequent Events. The maturity date of the BLG note, based on the last forbearance agreement, is June 30, 2026. BLG 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 January 8, 2026.

Current wording

Since January 2026, the Bion Loan Group (BLG) has agreed to several forbearance agreements, extending the maturity date of their note. The note now bears interest at 9%, along with other minor modifications detailed above inNote 5. Notes Payable: Note payable - related party. The maturity date of the BLG note, based on the last forbearance agreement, is June 30, 2026. BLG 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 January 8, 2026.

Previous wording

**J:**In November 2025, the Company launched a secured promissory note offering (Shareholder Notes) to previous investors/shareholders (and certain others) 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 the Company for the larger offering/ funding that will be required. As of filing date, Bion has raised $1,050,000 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 or planned facility.

Current wording

**J:**In November 2024, the Company launched a secured promissory note offering (Shareholder Notes) to previous investors/shareholders (and certain others) 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 the Company for the larger offering/ funding that will be required. As of filing date, Bion has raised $1,164,800 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 or planned facility.

Previous wording

THREE MONTHS ENDED DECEMBER 31, 2025 COMPARED TO THE THREE MONTHS ENDED DECEMBER 31,2024

Current wording

THREE MONTHS ENDED MARCH 31, 2026 COMPARED TO THE THREE MONTHS ENDED MARCH 31, 2025

Previous wording

Total general and administrative expenses were $274,000 and $336,000 for the three months ended December 31, 2025 and 2024, respectively.

Current wording

Total general and administrative expenses were $304,555 and $475,000 for the three months ended March 31, 2026 and 2025, respectively.

Previous wording

Salaries and related payroll tax expenses were $86,000 and $89,000 for the three months ended December 31, 2025 and 2024, respectively. Consulting costs were $65,000 and $45,000 for the three months ended December 31, 2025 and 2024, respectively. Investor relations expenses were $4,000 and $64,000 for the three months ended December 31, 2025 and 2024, respectively. The difference of $60,000 was a result of reducing investor relations spending to conserve cash. Legal costs were $179 and $1,000 for the three months ended December 31, 2025 and 2024, respectively.

Current wording

Salaries and related payroll tax expenses were $91,000 and $92,000 for the three months ended March 31, 2026 and 2025, respectively. Consulting costs were $86,000 and $49,000 for the three months ended March 31, 2026 and 2025, respectively. Investor relations expenses were $7,000 and $27,000 for the three months ended March 31, 2026 and 2025, respectively. The difference of $20,000 was a result of reducing investor relations spending to conserve cash. Legal costs were $8,000 and nil for the three months ended March 31, 2026 and 2025, respectively.

Previous wording

Stock-based compensation for the three months ended December 31, 2025 and 2024 were nil and nil, respectively.

Current wording

Stock-based compensation for the three months ended March 31, 2026 and 2025 were $7,000 and $179,000, respectively.

Previous wording

Total research and development expenses were $8,000 and $7,000 for the three months ended December 31, 2025 and 2024, respectively.

Current wording

Total research and development expenses were $3,000 and $6,000 for the three months ended March 31, 2026 and 2025, respectively.

Previous wording

Salaries and related payroll tax expenses were $1,000 and $1,000 for the three months ended December 31, 2025 and 2024, respectively. Consulting costs were nil and nil for the three months ended December 31, 2025 and 2024, respectively. Legal costs were $6,700 and $5,600 for the three months ended December 31, 2025 and 2024, respectively.

Current wording

Salaries and related payroll tax expenses were $1,000 and $1,000 for the three months ended March 31, 2026 and 2025, respectively. Consulting costs were nil and nil for the three months ended March 31, 2026 and 2025, respectively. Legal costs were $1,000 and $4,000 for the three months ended March 31, 2026 and 2025, respectively.

Previous wording

As a result of the factors described above, the loss from operations was $282,000 and $344,000 for the three months ended September 30, 2025 and 2024 respectively.

Current wording

As a result of the factors described above, the loss from operations was $308,000 and $481,000 for the three months ended March 31, 2026 and 2025, respectively.

Previous wording

Interest expense related to deferred compensation, loan payable and convertible notes prior to capitalization was $44,000 and $55,000 for the three months ended December 31, 2025 and 2024, respectively. Interest expense related to warrant modifications was $29,000 and $181,000, for the three months ended December 31, 2025 and 2024, respectively.

Current wording

Interest expense related to deferred compensation, loan payable and convertible notes prior to capitalization was $47,000 and $34,000 for the three months ended March 31, 2026 and 2025, respectively. Interest expense related to warrant modifications was $72,000 and nil, for the three months ended March 31, 2026 and 2025, respectively.

Previous wording

As a result of the factors described above, the net loss attributable to Bion’s stockholders was $355,000 and $374,000 for the three months ended December 31, 2025 and 2024, respectively, and the net loss per basic common share was $.01 and $.01 for the three months ended December 31, 2025 and 2024, respectively.

Current wording

As a result of the factors described above, the net loss attributable to Bion’s stockholders was $424,000 and $511,000 for the three months ended March 31, 2026 and 2025, respectively, and the net loss per basic common share was $.01 and $.01 for the three months ended March 31, 2026 and 2025, respectively.

Previous wording

SIX MONTHS ENDED DECEMBER 31, 2025 COMPARED TO THE SIX MONTHS ENDED DECEMBER 31,2024

Current wording

NINE MONTHS ENDED MARCH 31, 2026 COMPARED TO THE NINE MONTHS ENDED MARCH 31, 2025

Previous wording

Total revenues were nil for both the six months ended December 31, 2025 and 2024.

Current wording

Total revenues were nil for both the nine months ended March 31, 2026 and 2025.

Previous wording

Total general and administrative expenses were $744,000 and $1,296,000 for the six months ended December 31, 2025 and 2024, respectively.

Current wording

Total general and administrative expenses were $1,049,000 and $1,771,000 for the nine months ended March 31, 2026 and 2025, respectively.

Previous wording

Stock-based compensation for the six months ended December 31, 2025 and 2024 were $117,000 and $659,000, respectively.

Current wording

Stock-based compensation for the nine months ended March 31, 2026 and 2025 were $125,000 and $837,000, respectively.

Previous wording

Total depreciation expense was nil and $490 for the six months ended December 31, 2025 and 2024, respectively.

Current wording

Total depreciation expense was nil and $695 for the nine months ended March 31, 2026 and 2025, respectively.

Previous wording

Total research and development expenses were $15,000 and $14,000 for the six months ended December 31, 2025 and 2024, respectively.

Current wording

Total research and development expenses were $18,000 and $19,000 for the nine months ended March 31, 2026 and 2025, respectively.

Previous wording

As a result of the factors described above, the loss from operations was $759,000 and $1,310,000 for the six months ended December 31, 2025 and 2024 respectively.

Current wording

As a result of the factors described above, the loss from operations was $1,067,000 and $1,791,000 for the nine months ended March 31, 2026 and 2025, respectively.

Previous wording

Interest expense related to deferred compensation, loan payable and convertible notes prior to capitalization was $87,000 and $55,000 for the six months ended December 31, 2025 and 2024, respectively. Interest expense related to warrant modifications was $90,000 and $181,000 for the six months ended December 31, 2025 and 2024, respectively.

Current wording

Interest expense related to deferred compensation, loan payable and convertible notes prior to capitalization was $134,000 and $90,000 for the nine months ended March 31, 2026 and 2025, respectively. Interest expense related to warrant modifications was $162,000 and $181,000 for the nine months ended March 31, 2026 and 2025, respectively.

Previous wording

The net loss attributable to the noncontrolling interest was nil and nil for the six months ended December 31, 2025 and 2024, respectively.

Current wording

The net loss attributable to the noncontrolling interest was nil and nil for the nine months ended March 31, 2026 and 2025, respectively.

Previous wording

As a result of the factors described above, the net loss attributable to Bion’s stockholders was $936,000 and $1,546,000 for the six months ended December 31, 2025 and 2024, respectively, and the net loss per basic common share was $.02 and $.03 for the six months ended December 31, 2025 and 2024, respectively.

Current wording

As a result of the factors described above, the net loss attributable to Bion’s stockholders was $1,360,000 and $2,057,000 for the nine months ended March 31, 2026 and 2025, respectively, and the net loss per basic common share was $.02 and $.04 for the nine months ended March 31, 2026 and 2025, respectively.

Previous wording

The Company's condensed consolidated financial statements for the six months ended December 31, 2025 have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. The Report of our Independent Registered Public Accounting Firm on the Company's consolidated financial statements as of and for the year ended June 30, 2025 includes a "going concern" explanatory paragraph which means that the auditors stated that conditions exist that raise substantial doubt about the Company's ability to continue as a going concern.

Current wording

The Company's condensed consolidated financial statements for the nine months ended March 31, 2026 have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. The Report of our Independent Registered Public Accounting Firm on the Company's consolidated financial statements as of and for the year ended June 30, 2025 includes a "going concern" explanatory paragraph which means that the auditors stated that conditions exist that raise substantial doubt about the Company's ability to continue as a going concern.

Previous wording

As of December 31, 2025, the Company had cash of approximately $6,000. During the six months ended December 31, 2025, net cash used in operating activities was $421,000, primarily consisting of cash operating expenses related to salaries and benefits, and other general and administrative costs such as insurance, legal, accounting, consulting and investor relations. Cash expenditures were offset in part by proceeds from financing activities, a total of $423,000 in debt funding. During the six months ended December 31, 2024, net cash used in operating activities was $465,000, primarily consisting of cash operating expenses related to salaries and benefits, and other general and administrative costs such as insurance, legal, accounting, consulting and investor relations expenses as well as the purchase of property and equipment. Cash expenditures were offset by proceeds from financing activities, a total of $445,000 in debt funding.

Current wording

As of March 31, 2026, the Company had cash of approximately $44,000. During the nine months ended March 31, 2026, net cash used in operating activities was $673,000, primarily consisting of cash operating expenses related to salaries and benefits, and other general and administrative costs such as insurance, legal, accounting, consulting and investor relations. Cash expenditures were offset in part by proceeds from financing activities, a total of $712,000 in debt funding net commissions. During the nine months ended March 31, 2025, net cash used in operating activities was $673,000, primarily consisting of cash operating expenses related to salaries and benefits, and other general and administrative costs such as insurance, legal, accounting, consulting and investor relations expenses as well as the purchase of property and equipment.

Previous wording

During the six months ended December 31, 2025 and 2024, the Company invested nil and nil in the purchase of property and equipment, respectively, due to the Company’s effort to conserve cash.

Current wording

During the nine months ended March 31, 2026 and 2025, the Company invested nil and nil in the purchase of property and equipment, respectively, due to the Company’s effort to conserve cash.

Previous wording

During the six months ended December 31, 2025, the Company received net cash proceeds of $400,000 from convertible notes payable, less $9,000 in commissions, $25,000 from demand note and $8,000 from notes payable from related parties.

Current wording

During the nine months ended March 31, 2026, the Company received net cash proceeds of $689,000 from convertible notes payable, less $17,000 in commissions, $25,000 from demand note and $16,000 from notes payable from related parties.

Previous wording

As of December 31, 2025, the Company has debt obligations, including accrued interest, consisting of: a) deferred compensation of $1,177,000, b) convertible notes payable of $1,494,000, c) convertible bridge note payable of $472,000, d) notes payable related party of $450,000 and demand note of $26,000. As of December 31, 2024, the Company had debt obligations of a) deferred compensation of $1,031,000, and b) convertible notes payable – affiliates of $1,728,000 and c) convertible note payable including accrued interest of $437,000 and d) notes payable including accrued interest of $407,000.

Current wording

As of March 31, 2026, the Company has debt obligations, including accrued interest, consisting of: a) deferred compensation of $1,255,000, b) convertible notes payable of $1,808,000, c) convertible bridge note payable of $482,000, d) notes payable related party of $467,000 and demand note of $26,000. As of March 31, 2025, the Company has debt obligations, including accrued interest, consisting of: a) deferred compensation of $1,173,000, b) convertible notes payable of $2,310,000, c) convertible bridge note payable of $455,000, and d) notes payable related party of $423,000.

Previous wording

As of December 31, 2025, the Company had cash of approximately $6,000.

Current wording

As of March 31, 2026, the Company had cash of approximately $44,000.

Previous wording

The Company continues to explore sources of additional financing (including potential agreements with strategic partners – both financial and ag-industry) to satisfy its current and future operating and capital expenditure requirements as it is not currently generating any significant revenues. Bion’s leadership team’s new approach, developing a single proof-of-concept project vs multiple projects developed simultaneously, will substantially reduce the company’s need to raise capital. Further, leadership believes this approach represents a more achievable goal, which coupled with the addition of new leadership, including Turk Stovall to lead Bion’s beef efforts, will reinspire confidence in our own shareholders, as well as assure potential new strategic and institutional investors, and make it easier to raise funds.

Current wording

The Company continues to explore sources of additional financing (including potential agreements with strategic partners – both financial and ag-industry) to satisfy its current and future operating and capital expenditure requirements as it is not currently generating any significant revenues. Bion’s leadership team’s new approach, developing a single proof-of-concept project vs multiple projects developed simultaneously, will substantially reduce the company’s need to raise capital. Further, leadership believes this approach represents a more achievable goal, which coupled with the addition of new leadership, will reinspire confidence in our own shareholders, as well as assure potential new strategic and institutional investors, and make it easier to raise funds.

Previous wording

For the six months ended December 31, 2025 the Company had a loss of $936,000 including $117,000 non-cash compensation expenses related to extension of warrants and options.

Current wording

For the nine months ended March 31, 2026 the Company had a loss of $1,360,000 including $125,000 non-cash compensation expenses related to extension of warrants and options.

Previous wording

To help alleviate short-term cash needs for continued operations, in August 2024, three affiliates of the Company (Greg Schoener, Interim COO & Director; Turk Stovall, previous Director; Bob Weerts, now-deceased 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 provided 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 owned 60% of BLG, which has a security interest in the Company’s Intellectual Property. The BLG note bears interest at a rate of 9% per annum and the maturity date is June 30, 2026. As of the filing date, BLG has advanced $407,735. 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. The Company has entered into three forbearance agreements; the second that raised the interest rate to 9% and the third that extended the maturity date to June 30, 2026.

Current wording

To help alleviate short-term cash needs for continued operations, in August 2024, three affiliates of the Company (Greg Schoener, Interim COO & Director; Turk Stovall, previous Director; Bob Weerts, now-deceased 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 provided 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 owned 60% of BLG, which has a security interest in the Company’s Intellectual Property. The BLG note bears interest at a rate of 9% per annum and the maturity date is June 30, 2026. As of the filing date, BLG has advanced $415,735. 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. The Company has entered into three forbearance agreements; the second that raised the interest rate to 9% and the third that extended the maturity date to June 30, 2026.

Previous wording

In November 2025, the Company launched a secured promissory note offering 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 $1,050,000 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 or planned facility.

Current wording

In November 2024, the Company launched a secured promissory note offering 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 $1,164,800 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 or planned facility.

Previous wording

The Company has not made consistent lease payments since October 16, 2023. The Company made a payment of $10,500 in October 2024 and $6,250 in February, October and November 2025. The Company owes $131,250 in lease payments at December 31, 2025.

Current wording

The Company has not made consistent lease payments since October 16, 2023. The Company made four payments totaling $25,000 in the fiscal year to date. The Company owes $137,500 in lease payments at March 31, 2026.