ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
This Annual Report on Form 10-K (and the documents
incorporated herein by reference) contain forward-looking statements, within the meaning of Section 27A of the Securities Act and Section
21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), that involve substantial risks and uncertainties.
Forward-looking statements generally can be identified by the use of forward-looking terminology such as "may," "will,"
"expect," "intend," "estimate," "anticipate," "project," "predict," "plan,"
"believe," or "continue," or the negative thereof or variations thereon and/or references to “goals”,
“targets”, “projections” or similar terminology. The expectations reflected in forward-looking statements may
prove to be incorrect. “The Company's actual results of operations, most of which are beyond the Company's control, could differ
materially. We wish to caution readers not to place undue reliance on any such forward looking statements, which speak only as of the
date made. Any forward-looking statements represent management's best judgment as to what may occur in the future. However, forward looking
statements are subject to risks, uncertainties and important factors beyond our control that could cause actual results and events to
differ materially from historical results of operations and events and those presently anticipated or projected.
These factors include adverse economic conditions,
entry of new and stronger competitors, inadequate capital and limited ability to obtain financing, needed personnel and equipment, unexpected
costs, failure (or delay) to gain product certifications and/or regulatory approvals in the United States (or particular states) or foreign
countries, loss (permanently or for any extended period of time) of the services of members of the Company’s small core management
team (many of whom are age 70 or older) and failure to capitalize upon access to new markets. Additional risks and uncertainties that
may affect forward looking statements about Bion's business and prospects include: i) the possibility that markets for nutrient reduction
credits (discussed below) and/or other ways to monetize nutrient reductions and other environmental benefits will be slow to develop (or
not develop at all), ii) PA1’s dissolution and its effect on how the Company is viewed, (if any), iii) the possibility that competitors
will develop more comprehensive and/or less expensive environmental solutions, iv) delays in market awareness of Bion and our Systems,
v) uncertainties and costs increases related to research and development efforts to update and improve Bion’s technologies and applications
thereof, and/or vi) delays and/or costs exceeding expectations relating to Bion's development of the Initial Project, JVs and/or Projects
and vii) failure of marketing strategies, each of which could have both immediate and long term material adverse effects by placing us
behind our competitors and requiring expenditures of our limited resources.
THESE RISKS, UNCERTAINTIES AND FACTORS BEYOND OUR
CONTROL ARE MAGNIFIED DURING THE CURRENT UNCERTAIN PERIOD RELATED TO THE COVID-19 PANDEMIC AND THE UNIQUE ECONOMIC, FINANCIAL, GOVERNMENTAL
AND HEALTH-RELATED CONDITIONS IN WHICH THE COMPANY, THE ENTIRE COUNTRY AND THE ENTIRE WORLD NOW RESIDE. TO DATE THE COMPANY HAS
EXPERIENCED DIRECT IMPACTS IN VARIOUS AREAS INCLUDING WITHOUT LIMITATION: I) GOVERNMENT-ORDERED SHUTDOWNS WHICH HAVE SLOWED
THE COMPANY’S RESEARCH AND DEVELOPMENT PROJECTS AND OTHER INITIATIVES, II) SHIFTED FOCUS OF STATE AND FEDERAL GOVERNMENT WHICH IS
LIKELY TO NEGATIVELY IMPACT THE COMPANY’S LEGISLATIVE INITIATIVES IN PENNSYLVANIA AND WASHINGTON DC, III) STRAINS AND UNCERTAINTIES
IN BOTH THE EQUITY AND DEBT MARKETS HAVE MADE DISCUSSION AND PLANNING OF FUNDING OF THE COMPANY AND ITS INITIATIVES AND PROJECTS WITH
INVESTMENT BANKERS, BANKS AND POTENTIAL STRATEGIC PARTNERS MORE TENUOUS, IV) STRAINS AND UNCERTAINTIES IN THE AGRICULTURAL SECTOR AND
MARKETS HAVE MADE DISCUSSION AND PLANNING OF FUNDING OF THE COMPANY AND ITS INITIATIVES AND PROJECTS MORE DIFFICULT AS FUTURE INDUSTRY
CONDITIONS ARE NOW MORE DIFFICULT TO ASSESS/PREDICT, V) CONSTRAINTS DUE TO PROBLEMS EXPERIENCED IN THE GLOBAL INDUSTRIAL SUPPLY CHAIN
WHICH HAVE INCREASED ANTICIPATED PROJECT DEVELOPMENT COSTS, VI) DUE TO THE AGE AND HEALTH OF OUR CORE MANAGEMENT TEAM, MOST OF WHOM ARE
AGE 70 OR OLDER AND HAVE HAD ONE OR MORE EXISTING HEALTH ISSUES, THE COVID-19 PANDEMIC PLACES THE COMPANY AT GREATER RISK THAN WAS PREVIOUSLY
THE CASE (TO A HIGHER DEGREE THAN WOULD BE THE CASE IF THE COMPANY HAD A LARGER, DEEPER AND/OR YOUNGER CORE MANAGEMENT TEAM), AND VII)
THERE ALMOST CERTAINLY WILL BE OTHER UNANTICIPATED CONSEQUENCES FOR THE COMPANY AS A RESULT OF THE CURRENT PANDEMIC EMERGENCY AND ITS
AFTERMATH.
Bion disclaims any obligation subsequently to revise
any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated
or unanticipated events.
The following discussion and analysis should be read
in conjunction with the Consolidated Financial Statements and Notes to Consolidated Financial Statements filed with this Report.
BUSINESS OVERVIEW
Bion Environmental Technologies, Inc.'s ("Bion,"
"Company," "We," "Us," or "Our") was incorporated in 1987 in the State of Colorado. Bion’s
mission is to create extraordinary value for our shareholders and employees (all of whom own securities in the Company) while delivering
premium, sustainable products to our customers through ventures developing profitable, transparent, and sustainable solutions for livestock
agriculture.
Our patented and proprietary technology provides advanced
waste treatment and resource recovery for large-scale livestock production facilities (also known as “Concentrated Animal Feeding
Operations” or “CAFOs"). Livestock production and its waste, particularly from CAFOs, has been identified as one of the
greatest soil, air, and water quality problems in the U.S. today. Application of our third generation technology and business/technology
platform (“Gen3Tech”) can largely mitigate these environmental problems, while simultaneously improving operational/ resource
efficiencies by recovering high-value co-products from the CAFOs’ waste stream. These waste stream ‘assets’ –
nutrients and methane – have traditionally been wasted or underutilized and are the same ‘pollutants’ that today fuel
harmful algae blooms, contaminate groundwater, and exacerbate climate change.
Bion’s business model and technology platform
can create the opportunity for joint ventures s (in various contractual forms)(“JVs”) between the Company and large livestock/food/fertilizer
industry participants based upon the supplemental cash flow generated by implementation of our Gen3Tech business model, which cash flows
will support the costs of technology implementation (including servicing related debt). We anticipate this will result in substantial
long term value for Bion. In the context of such JVs, we believe that the verifiable sustainable branding opportunities (conventional
and organic) in meat will represent the single largest enhanced revenue contributor provided by Bion to the JVs (and Bion licensees).
The Company believes that the largest portion of its business with be conducted through such JVs, but a material portion may involve licensing
and or other approaches.
Bion’s Gen3 Tech was designed to capture and
stabilize these assets and produce renewable energy, fertilizer products, and clean water as part of the process of raising verifiably
sustainable livestock. All steps and stages in the treatment process will be third-party verified, providing the basis for additional
revenues, including renewable energy-related credits and, eventually, payment for ecosystem services, such as nutrient credits as described
below. The same verified data will be used to substantiate the claims of a USDA-certified sustainable brand that will support premium
pricing for the meat/ animal protein products that are produced in Bion facilities.
During the first half of 2022 Bion began marketing
our sustainable beef opportunity to retailers, food service distributors and the meat industry in the U.S. In general, the response
has been favorable. During July 2022, Bion announced a letter of intent (“Ribbonwire LOI”) to develop its first large-scale
commercial project, a 15,000-head sustainable beef cattle feeding operation together with the Ribbonwire Ranch, in Dalhart, Texas (with
a provision to expand to 60,000 head) (“Dalhart Project”). The Dalhart Project will be developed to produce blockchain-verified,
sustainable beef (with reduced the stress on cattle caused by extreme weather and temperatures and resulting higher feed/weight gain efficiency)
while remediating the environmental impacts associated usually associated with cattle CAFOs. Bion’s patented technology will treat
the waste stream and recover/refine valuable coproducts that include clean water, renewable natural gas (RNG), photovoltaic solar electricity,
organic fertilizer and potentially other products. We anticipate converting the Ribbonwire LOI into a definitive agreement with Ribbonwire
Ranch and creating distribution agreements with key retailers and food service distributors during the current fiscal year.
Bion’s business model and technology platform
can create the opportunity for joint ventures s (in various contractual forms)(“JVs”) between the Company and large livestock/food/fertilizer
industry participants based upon the supplemental cash flow generated by implementation of our Gen3Tech business model, which cash flows
will support the costs of technology implementation (including servicing related debt). We anticipate this will result in substantial
long-term value for Bion. In the context of such JVs, we believe that the verifiable sustainable branding opportunities (conventional
and organic) in meat will represent the single largest enhanced revenue contributor provided by Bion to the JVs (and, in some cases, Bion
licensees). The Company believes that the largest portion of its business with be conducted through such JVs, but a material portion may
involve licensing and or other approaches.
Bion’s Gen3Tech was designed to capture and
stabilize these assets and produce renewable energy, fertilizer products, and clean water as part of the process of raising verifiably
sustainable livestock. All steps and stages in the treatment process will be third-party verified, providing the basis for additional
revenues, including renewable energy-related credits and, eventually, payment for ecosystem services, such as nutrient credits as described
below. The same verified data will be used to substantiate the claims of a USDA-certified sustainable brand that will support premium
pricing for the meat/ animal protein products that are produced in Bion facilities.
Our business plan is focused on executing multiple
agreements and letters of intent related to the “Bion Beef Opportunity” and commencing development of multiple sustainable
beef joint venture projects over the next twelve-eighteen (12-18) months while moving forward with the Initial Project (see below) and
the Dalhart Project. Bion also intends to pursue other opportunities in the livestock industry enabled by our Gen3Tech business model.
The Ribbonwire LOI announcement has generated significant interest within the livestock industry (among ranchers, feedlot operators, farmers
and other AG industry parties). We believe that this interest, combined with consumer interest in ‘sustainable products’ and
the growing enthusiasm among some livestock industry parties for environmental/sustainable/regenerative practices, provides Bion (and
its partners/venturers) with an opportunity to move forward with a truly sustainable solution in this industry segment.
During the next six months, the Company intends
to construct and begin operations of phase 1 of our Initial Project located near Fair Oaks, Indiana. Bion expects the Initial
Project to provide data that illustrates the effectiveness of our Gen3Tech in a commercial setting by the end of the 2nd
quarter in fiscal 2023 which will support development of the Dalhart Project (and other projects) during fiscal 2023 and
thereafter. We believe this data will also provide additional potential stakeholders (cattle producers, cattle feeders,
packers, distributors, retailers and financial institutions) with the information they need to proceed with confidence in
collaborating with Bion on multiple new projects (see below).
Bion
is now focused primarily on: i) development/construction of the Initial Project, our initial commercial-scale Gen3Tech installation (see
discussion herein below and Notes to Financial Statements,
ii) development/construction of the Dalhart Project, iii) developing applications and markets for its sustainable (conventional and organic)
animal protein products and its low carbon organic fertilizer products , iv) discussions regarding initiation and development of agreements
and joint ventures (“JVs” as discussed below) (and related projects) based on the augmented capabilities of our Gen3Tech
business platform (in the sustainable beef and other livestock segments), while (v) continuing to pursue business opportunities related
to large retrofit projects (such as the Kreider poultry project JV described below) and vi) ongoing R&D activities.
HISTORY, BACKGROUND AND CURRENT ACTIVITIES
See discussion at Item 1 above.
Pennvest Loan and Bion PA1 LLC (“PA1”)
Dissolution
PA1, the Company’s
wholly-owned subsidiary, was dissolved on December 29, 2021 on which date it owed approximately $10,010,000 under the terms of the Pennvest
Loan related to the construction of the Kreider 1 System including accrued interest and late charges totaling $2,255,802 as of that date.
Through the date of the dissolution, PA1 was a wholly-owned subsidiary of the Company and its assets and liabilities were included on
the Company’s consolidated balance sheets. At September 30, 2021, PA1’s total assets were $297 and its total liabilities were
$10,154,334 (including the Pennvest Loan in the aggregate amount of $9,939,148, accounts payable of $214,235 and accrued liabilities of
$950) which sums were included in the Company’s consolidated balance sheets in its Form 10-Q for the quarter ended September 30,
2021. Subsequent to the dissolution of PA1, its assets and liabilities are no longer consolidated and included in the Company’s
balance sheets. As of December 29, 2021, PA1’s total assets were nil and its total liabilities were $10,234,501 (including the Pennvest
Loan in the aggregate amount of $10,009,802, accounts payable of $212,263 and accrued liabilities of $12,436. The net amount of $10,234,501
was recognized as a gain on the legal dissolution of a subsidiary in other (income) expense.
As background, the terms
of the Pennvest Loan provided for funding of up to $7,754,000 which was to be repaid by interest-only payments for three years, followed
by an additional ten-year amortization of principal. The Pennvest Loan accrued interest at 2.547% per annum for years 1 through 5 and
3.184% per annum for years 6 through maturity. The Pennvest Loan required minimum annual principal payments of approximately $5,886,000
in fiscal years 2013 through 2021, and $846,000 in fiscal year 2022, $873,000 in fiscal year 2023 and $149,000 in fiscal year 2024. The
Pennvest Loan was collateralized by PA1’s Kreider 1 System and by a pledge of all revenues generated from Kreider 1 including, but
not limited to, revenues generated from nutrient reduction credit sales and by-product sales. In addition, in consideration for the excess
credit risk associated with the project, Pennvest was entitled to participate in the profits from Kreider 1 calculated on a net cash flow
basis, as defined. The Company has incurred interest expense related to the Pennvest Loan of $123,444 and $246,887 for the years ended
June 30, 2022 and 2021, respectively. Based on the limited development of the depth and breadth of the Pennsylvania nutrient reduction
credit market, PA1 commenced discussions and negotiations with Pennvest related to forbearance and/or re-structuring the obligations under
the Pennvest Loan during 2013. In the context of such negotiations, PA1 elected not to make interest payments to Pennvest on the Pennvest
Loan since January 2013. Additionally, the PA1 did not make any principal payments, which were to begin in fiscal 2013, and, therefore,
the Company classified the Pennvest Loan as a current liability through the dissolution of PA1 on December 29, 2021.
During August 2012, the Company
provided Pennvest (and the PADEP) with data demonstrating that the Kreider 1 system met the ‘technology guaranty’ standards
which were incorporated in the Pennvest financing documents and, as a result, the Pennvest Loan has been solely an obligation of PA1 since
that date. Note, however, the Company’s consolidated balance sheets as of June 30, 2021 reflects the Pennvest Loan as a liability
of $9,868,495 despite the fact that the obligation (if any) was solely an obligation of PA1.
On September 25, 2014, the
Pennsylvania Infrastructure Investment Authority (“Pennvest”) exercised its right to declare the PA1’s Pennvest Loan
in default, accelerated the Pennvest Loan and demanded that PA1 pay $8,137,117 (principal, interest plus late charges) on or before October
24, 2014. PA1 did not make the payment and did/does not have the resources to make the payments demanded by Pennvest. PA1 commenced discussions
and negotiations with Pennvest concerning this matter but Pennvest rejected PA1’s proposal made during the fall of 2014. PA1 made
a final proposal to Pennvest during September 2021 which proposal was also rejected by Pennvest. PA1 provided Pennvest with its financial
statements (which include a description of system status) annually. During the 2021 fiscal year, Pennvest’s auditors requested a
‘corrective action plan’ and PA1 informed Pennvest that “... there is no viable corrective action plan for the
Pennvest Loan (‘Loan’). The facility funded by the Loan has been shut down for many years (which has been disclosed in the
annual financial reports to Pennvest and in public filings by the parent of Bion PA 1, LLC) and the technology utilized in the facility
is now obsolete. The facility has not been commercially operated for approximately six years and has generated zero income. We recommend
that Pennvest take appropriate steps to remove and sell the equipment.” Pennvest responded favorably to the approach of selling
the equipment.
On December 29, 2021, the
Company approved and executed a ‘Consent of the Sole Member of Bion PA 1’ (the “Consent to Dissolution”) that
authorized the complete liquidation and dissolution of PA1. A Statement of Dissolution was filed by PA1 with the Colorado Secretary of
State on December 29, 2021. The Company is of the understanding that the liquidation value of Bion PA 1’s property is substantially
below the current amount outstanding under the Funding Agreement dated October 27, 2010 by and between PA1 and Pennvest, the only known
secured creditor of PA1. Post-dissolution, PA1’s activities will be limited entirely to activities required to properly distribute
its net assets to creditors and wind down its business.
PA1 and Pennvest agreed to
have the equipment sold by a third party auctioneer who arranged for the sale of its property and delivery of all proceeds (net of
commissions and customary costs of sale) to Pennvest. The auction took place during the period between May 13-18, 2022. The Company’s
personnel assisted PA1 with this process as needed at no cost to PA1. The net sum of $104,725 was realized from the asset sale, which
sum was delivered to Pennvest on June 15, 2022. PA1 believes that the remaining unsold assets will be transferred to Kreider Farms during
the next quarter in order to complete the winding up of the Kreider 1 project.
Upon the complete distribution
of all assets of PA1, whether by transfer or sale and distribution of net proceeds as provided above, PA1 will use commercially reasonable
efforts to cause the cessation of all activities. No distributions of PA1’s assets will be made to the Company or its affiliates.
The Consent to Dissolution authorized Mark A. Smith, the Company’s President and the sole manager of PA1, to cause to be delivered
for filing the Statement of Dissolution, to give notice of the dissolution, and to take any other act necessary to wind up and liquidate
the business.
PA1 has made no payments
to vendors or other creditors in connection with the dissolution other than the payment to Pennvest described above. No distributions
or payments of any kind have ever been made to the Company, the sole member of PA1 since inception and no payment will be made to the
Company or any affiliate in connection with the dissolution.
For more information regarding the history and
background of the Pennvest Loan and PA1, please review our Form’s 10-K for the years from 2008 through 2021 including the Notes
to the Consolidated Financial Statements included therein.
COVID-19 PANDEMIC RELATED MATTERS:
The Company faces risks and uncertainties and
factors beyond our control that are magnified during the current Covid-19 pandemic and the unique economic, financial, governmental and
health-related conditions in which the Company, the country and the entire world now reside. To date the Company has experienced direct
impacts in various areas including but without limitation: i) government ordered shutdowns which have slowed the Company’s research
and development projects and other initiatives, ii) shifted focus of state and federal governments which is likely to negatively impact
the Company’s legislative initiatives in Pennsylvania and Washington D. C., iii) strains and uncertainties in both the equity and
debt markets which have made discussion and planning of funding of the Company and its initiatives and projects with investment bankers,
banks and potential strategic partners more tenuous, iv) strains and uncertainties in the agricultural sector and markets have made discussion
and planning more difficult as future industry conditions are now more difficult to assess and predict, v) constraints due to problems
experienced in the global industrial supply chain since the onset of the Covid-19 pandemic, which have delayed certain research and development
testing and have delayed and/or increased the cost of construction of the Company’s initial 3G Tech installation as equipment/services
remain difficult to acquire in a timely manner, vi) due to the age and health of our core management team, many of whom are age 70 or
older and have had one or more existing health issues (including brief periods of Covid-19 infection), the Covid-19 pandemic places the
Company at greater risk than was previously the case (to a higher degree than would be the case if the Company had a larger, deeper and/or
younger core management team), and vii) there almost certainly will be other unanticipated
CRITICAL ACCOUNTING POLICIES
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 Accounting Standards Codification
(“ASC”) 606 “Revenue from Contracts with Customers”.
Stock-based compensation
The Company follows the provisions of ASC
718, which generally requires that share-based compensation transactions be accounted and recognized in the consolidated statement
of operations based upon their grant date fair values.
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. . As of June 30, 2022 and 2021, there are no derivative financial instruments.
Options:
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. The U.S. 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.
Warrants:
The Company has issued warrants to purchase common
shares of the Company. Warrants are valued using a fair value based method, whereby the fair value of the warrant is determined at the
warrant issue date using a market-based option valuation model based on factors including an evaluation of the Company’s value as
of the date of the issuance, consideration of the Company’s limited liquid resources and business prospects, the market price of
the Company’s stock in its mostly inactive public market and the historical valuations and purchases of the Company’s warrants.
When warrants are issued in combination with debt or equity securities, the warrants are valued and accounted for based on the relative
fair value of the warrants in relation to the total value assigned to the debt or equity securities and warrants combined.
Lease Accounting:
The Company accounts for leases under ASC 842, Leases (“ASC
842”). Accordingly, the Company will determine whether an arrangement contains a lease at the inception of the arrangement. If a
lease is determined to exist, the term of such lease is assessed based on the date on which the underlying asset is made available for
the Company’s use by the lessor. The Company’s assessment of the lease term reflects the non-cancelable term of the lease,
inclusive of any rent-free periods and/or periods covered by early-termination options which the Company is reasonably certain of not
exercising, as well as periods covered by renewal options which the Company is reasonably certain of exercising. The Company also determines
lease classification as either operating or finance at lease commencement, which governs the pattern of expense recognition and the presentation
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 sheets 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.
YEAR ENDED JUNE 30, 2022 COMPARED TO
THE YEAR ENDED JUNE 30, 2021
Revenue
Total revenues were nil for both the years
ended June 30, 2022 and 2021, respectively.
General and Administrative
Total general and administrative expenses
were $2,348,000 and $2,078,000 for the years ended June 30, 2022 and 2021, respectively.
General and administrative expenses, excluding
stock-based compensation charges of $269,000 and $850,000, were $2,079,000 and $1,228,000 for the years ended June 30, 2022 and 2021,
respectively, representing an $851,000 increase. Salaries and related payroll tax expenses were $340,000 and $319,000, for the years ended
June 30, 2022 and 2021, respectively, representing a $21,000 increase. Consulting costs were $561,000 and $391,000 for the years ended
June 30, 2022 and 2021, respectively. The $170,000 increase in consulting costs is due to a general increase in the levels of Company’s
business activity without a large increase in the Company’s personnel including the consulting engagement with William O’Neill,
who is now the Company’s CEO, during the periods from July 1, 2021 through April 30, 2022 during which the Company paid $160,000
to secure his services ($25,000 was capitalized to the 3G project). Investor relations expenses were $395,000 and $149,000 for the years
ended June 30, 2022 and 2021, respectively, and the $246,000 increase is due to the 2022 shareholder meeting and new contract with an
investor relations firm and increased activity during the year ended June 30, 2022 due to the resumption of investor conferences. Legal
costs were $291,000 and $8,000 for the years ended June 30, 2022 and 2021, respectively, due to the hiring of a law firm to represent
the Company in a lawsuit for the hack and attempt to steal the Company’s domain, engaging a law firm on the dissolution of PA-1,
legal work in relation to corporate structure matters and preparation for the 2022 shareholder meeting and other matters.
General and administrative stock-based employee
compensation for the years ended June 30, 2022 and 2021 consists of the following:
General and administrative:
Change in fair value from modification of option terms $ — $ 9,000
Change in fair value from modification of warrant terms 8,000 25,000
Stock-based compensation charges were $269,000
and $850,000 for the years ended June 30, 2022 and 2021, respectively. The fair value of stock options expensed for the years ended June
30, 2022 and 2021 was $261,000 and $816,000, respectively. The Company capitalized $136,000 in stock-based compensation to the 3G project
as of June 30, 2022. The Company granted 730,000 options during the year ended June 30, 2022 which were fully vested at grant date, and
960,000 options during the period ended June 30, 2021, which were fully vested at grant date.
Depreciation
Total depreciation expense was $1,161 and
$827 for the years ended June 30, 2022 and 2021, respectively.
Research and Development
Total research and development expenses were
$201,000 and $749,000 for the years ended June 30, 2022 and 2021, respectively.
Research and development expenses, excluding stock-based
compensation charges of $22,000 and $202,000, were $179,000 and $547,000 for the years ended June 30, 2022 and 2021, respectively, representing
a $368,000 decrease largely resulting from completion of the bulk of the research and development work on our Gen3Tech as we shifted our
efforts to work on the Initial Project. Salaries and related payroll tax expenses were $32,000 and $94,000 for the years ended June 30,
2022 and 2021, respectively, as more salary expense was allocated to administrative expense for the year ended June 30, 2022. Consulting
costs were $80,000 and $214,000 for the years ended June 30, 2022 and 2021, respectively. The decrease in consulting is due to capitalizing
costs on the 3G project in 2022. The Company also incurred $55,000 and $48,000 for the years ended June 30, 2022 and 2021, respectively
in legal costs related to patent applications and renewals. The Company incurred $6,000 and $144,000 for the years ended June 30, 2022
and 2021, respectively in the development of new technologies for its anaerobic digestate process.
Research and development stock-based employee
compensation for the years ended June 30, 2022 and 2021 consists of the following:
Research and Development:
Stock-based compensation charges were $22,000 and
$202,000 for the years ended June 30, 2022 and 2021, respectively. The Company granted 730,000 and 960,000 fully vested options during
the years ended June 30, 2022 and 2021, a portion of which were allocated to research and development.
Loss from Operations
As a result of the factors described above,
the loss from operations was $2,550,000 and $2,828,000 for the years ended June 30, 2022 and 2021, respectively.
Other (Income) Expense
Other (income) expense was ($10,841,000) and $623,000 for the years ended
June 30, 2022 and 2021, respectively. The Company recognized a gain on the dissolution of PA1 of $10,235,000 and a gain of $902,000 for
the sale of a domain name. Total interest expense of $302,000 and $658,000 was recorded during the years ended June 30, 2022 and 2021,
respectively. Interest of $32,000 and nil was capitalized as part of the 3G project in property and equipment during the years ended June
30, 2022 and 2021, respectively.
Interest expense related to deferred
compensation, loan payable and convertible notes prior to capitalization of $32,000 to the 3G project was $334,000 and $472,000 for
years ended June 30, 2022 and 2021, respectively. The $138,000 decrease is due the dissolution of PA-1 and no interest related to
the Pennvest loan during the last six months ended June 30, 2022. Interest expense related to investor warrant modifications was nil
and $187,000 for year end June 30, 2022 and 2021.
Net Loss Attributable to the Noncontrolling
Interest
The net loss attributable to the noncontrolling
interest was $1,500 and $2,800 for the years ended June 30, 2022 and 2021, respectively.
Net Income (Loss) Attributable to Bion’s
Common Stockholders
As a result of the factors described above,
the net income (loss) attributable to Bion’s stockholders was $8,292,000 and ($3,448,000) for the years ended June 30, 2022 and
2021, respectively, and the net income (loss) per basic common share was $.20 and ($.10) for the years ended June 30, 2022 and 2021, respectively.
LIQUIDITY AND CAPITAL RESOURCES
The Company's consolidated financial statements for
the year ended June 30, 2022 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, 2022 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.
Operating Activities
As of June 30,2022, the Company had cash of approximately
$3,160,000. During the year ended June 30, 2022, net cash used in operating activities was $671,000, 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, primarily the exercise of warrants. As previously noted, the Company is currently not generating significant revenue and
accordingly has not generated cash flows from operations. The Company does not anticipate generating sufficient revenues to offset operating
and capital costs for a minimum of two to five years. While there are no assurances that the Company will be successful in its efforts
to develop and construct its Projects and market its Systems, it is certain that the Company will require substantial funding from external
sources. Given the unsettled state of the current credit and capital markets for companies such as Bion, there is no assurance the Company
will be able to raise the funds it needs on reasonable terms.
Investing Activities
During the year ended June 30, 2022, the Company
invested $2,062,000 in the purchase of property and equipment, primarily related to project construction in process. During the year ended
June 30, 2022, the Company invested $666,375 in a non-cash purchase of equipment for accounts payable related to the June 6, 2022 notice
of completion of certain work in process and an invoice from Buflovak for the next 25% payment on the January 28, 2022 purchase order
related to the Initial Project. The $666,375 was included in construction in process and accounts payable at June 30, 2022 and was paid
on July 5, 2022 bringing the aggregate payments to $1,999,125 as of the date of
this report.
Financing Activities
During the year ended June 30, 2022, the Company
received gross cash proceeds of $1,737,000 from the exercise of 2,315,550 warrants into shares of the Company’s common stock and
paid approximately $19,000 in cash commissions related to the exercise of warrants.
As of June 30, 2022, the Company has debt obligations
consisting of: a) deferred compensation of $595,000 and b) convertible notes payable – affiliates of $5,171,000.
Plan of Operations and Outlook
As of June 30, 2022, the Company had cash of approximately
$3,160,000.
The Company continues to explore sources of additional
financing to satisfy its current operating requirements as it is not currently generating any significant revenues. During fiscal years
2022 and 2021, the Company has faced progressively less difficulty in raising equity funding (but substantial equity dilution has resulted
from the larger amounts of equity financing during the periods). However, the Company anticipates substantial increases in demands for
capital and operating expenditures as it moves toward commercial implementation of its 3G Tech and development of JVs and, therefore,
is likely to continue to face, significant cash flow management challenges due to limited capital resources and working capital constraints
which have only recently begun to be alleviated. 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 all or part of their cash compensation and/or are accepting compensation
in the form of securities of the Company (Notes 5 and 7 to Financial Statements) and members of the Company's senior management have
from time to time made loans to the Company. During the year ended June 30, 2018 senior management and certain core employees and consultants
agreed to a one-time extinguishment of liabilities owed by the Company which in aggregate totaled $2,404,000. As of June 30 2022, such
deferrals/loans totaled approximately $5,765,000 (including accrued interest and deferred compensation converted into convertible obligations
and convertible promissory notes but excluding conversions of deferred compensation into the Company's common stock by officers, employees
and consultants that have already been completed). The extended constraints on available resources have had, and continue to have, negative
effects on the pace and scope of the Company's effort to develop its business. The Company made reductions in its personnel during the
years ended June 30, 2014 and 2015 and again in 2018. The constraint on available resources has had, and continues to have, negative
effects on the pace and scope of the Company’s efforts to 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 continue its recent increased
success in its efforts 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 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 the Initial Project, JVs, Projects (including
Integrated Projects) and CAFO Retrofit waste remediation systems (potentially including the Kreider 2 facility. The Company anticipates
that it will seek to raise from $20,000,000 to $80,000,000 or more (debt and equity) during the next twelve months. However, as discussed
above, there is no guarantee that we will be able to raise sufficient funds or further capital for the operations planned in the near
future.
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. During the year ended June 30, 2021
the Company raised gross proceeds of approximately $5,209,000 through the sale of its securities and paid commissions of approximately
$165,000, and anticipates raising additional funds from such sales and transactions. During the year ended June 30, 2022 the Company
raised gross proceeds for approximately $1,737,000 and paid commissions of approximately $18,600. However, there is no guarantee that
we will be able to raise sufficient funds or further capital for the operations planned in the near future.
Because the Company is not currently generating significant
revenues, the Company will need to obtain additional capital to fund its operations and technology development, to satisfy existing creditors,
to develop the Initial Project and subsequent Projects.
As indicated above, the Company anticipates that
it will seek to raise from $20,000,000 to $80,000,000 or more (from debt, equity, joint venture, strategic partnering, etc.) during the
next twelve months, some of which may be in the context of joint ventures for the development of one or more large scale projects. We
reiterate that there is no assurance, especially in the extremely unsettled capital markets that presently exist for companies such as
Bion, that the Company will be able to obtain the funds that it needs to stay in business, finance its Projects and other activities,
continue its technology development and/or to successfully develop its business.
See “Pennvest Loan and Bion PA1 LLC
(“PA1”) Dissolution” above and the Company’s Forms 10-K for the year 2009-2021 for discussion and more
details related to the dissolution of PA1, the Pennvest Loan and the Kreider 1 project.
There is extremely limited likelihood that funds
required during the next twelve months or in the periods immediately thereafter will be generated from operations and there is no assurance
that those funds will be available from external sources such as debt or equity financings or other potential sources. The lack of additional
capital resulting from the inability to generate cash flow from operations and/or to raise capital from external sources would force
the Company to substantially curtail or cease operations and would, therefore, have a material adverse effect on its business. Further,
there can be no assurance that any such required funds, if available, will be available on attractive terms or that they will not have
a significantly dilutive effect on the Company's existing shareholders. All of these factors have been exacerbated by the extremely limited
and unsettled credit and capital markets presently existing for companies such as Bion.
Covid-19 pandemic related matters:
The Company faces risks and uncertainties and factors
beyond our control that are magnified during the current Covid-19 pandemic and the unique economic, financial, governmental and health-related
conditions in which the Company, the country and the entire world now reside. To date the Company has experienced direct impacts in various
areas including but without limitation: i) government ordered shutdowns which have slowed the Company’s research and development
projects and other initiatives, ii) shifted focus of state and federal governments which is likely to negatively impact the Company’s
legislative initiatives in Pennsylvania and Washington D. C., iii) strains and uncertainties in both the equity and debt markets which
have made discussion and planning of funding of the Company and its initiatives and projects with investment bankers, banks and potential
strategic partners more tenuous, iv) strains and uncertainties in the agricultural sector and markets have made discussion and planning
more difficult as future industry conditions are now more difficult to assess and predict, v) constraints due to problems experienced
in the global industrial supply chain since the onset of the Covid-19 pandemic, which have delayed certain research and development testing
and have delayed and/or increased the cost of construction of the Company’s initial 3G Tech installation as equipment/services
remain difficult to acquire in a timely manner, vi) due to the age and health of our core management team, many of whom are age 70 or
older and have had one or more existing health issues (including brief periods of Covid-19 infection), the Covid-19 pandemic places the
Company at greater risk than was previously the case (to a higher degree than would be the case if the Company had a larger, deeper and/or
younger core management team), and vii) there almost certainly will be other unanticipated consequences for the Company as a result of
the current pandemic emergency and its aftermath.
CONTRACTUAL OBLIGATIONS
We have the following material contractual obligations
(in addition to employment and consulting agreements with management and employees):
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 following table summarized the supplemental
cash flow information for the year ended June 30, 2022:
The future minimum lease payment under noncancelable operating lease with
terms greater than one year as of June 30, 2022:
Less imputed interest (21,136 )
The weighted average remaining lease term and discounted rate related to
the Company’s lease liability as of June 30, 2022 were 3 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.
Through 3G1 the Company is in the process of developing
the Initial Project. See discussion above and in the Notes to our Financial Statements.
OFF-BALANCE SHEETS ARRANGEMENTS
The Company does not have any off-balance sheets arrangements (as that term
is defined in Item 303 of Regulation S-K) that are reasonably likely to have a current or future material effect on our financial condition,
revenue or expenses, results of operations, liquidity, capital expenditures or capital resources.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk.
Not applicable.
Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTAL DATA
The consolidated financial statements are set forth on pages F-1 through
F-32 hereto.
Item 9.
None.
Item 9A. Controls and Procedures.
Disclosure Controls and Procedures
As of June 30, 2022, 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, 2022 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.
Based on this evaluation, management has
concluded that our internal control over financial reporting was not effective as of June 30, 2022. Our President and Principal Financial
Officer concluded we have a material weakness due to our control environment, and one condition caused by this is an inadequate of segregation
of duties as well as a lack of timely review and approval of related party transactions and a second condition is the a lack of timely
review and approval of capitalized internal costs and interest. Our size has prevented us from being able to employ sufficient resources
to enable us to have an adequate level of supervision and segregation of duties within our internal control system. There is one person
involved in the processing of the Company's accounting and banking transactions and a single person with overall supervision and review
of the cash disbursements and receipts and the overall accounting process. Therefore, while there are some compensating controls in place,
it is difficult to ensure effective segregation of accounting duties. While we strive to segregate duties as much as practicable, there
is an insufficient volume of transactions to justify additional full time staff. As a result of this material weakness, we have implemented
remediation procedures whereby in May 2006 we engaged an outside accounting and consulting firm with SEC and US GAAP experience to assist
us with the preparation of our financial statements, evaluation of complex accounting issues and the implementation of systems to improve
controls and review procedures over all financial statement and account balances. In December of 2021, there was a change made to a new
outside accounting and consulting firm. We believe that this outside consultant's review improved our disclosure controls and procedures.
If this review is effective throughout a period of time, we believe it will help remediate the segregation of duties material weakness.
However, we may not be able to fully remediate the material weakness unless we hire more staff. We will continue to monitor and assess
the costs and benefits of additional staffing.
This annual report does not include an attestation
report of the Company’s independent registered public accounting firm regarding internal control over financial reporting. Management’s
report was not subject to attestation by the Company’s independent registered public accounting firm pursuant to rules of the SEC
that permit the Company to provide only management’s report on internal control in this annual report.
Website: Domain Sale/Resolved Litigation/Hacking/Theft
On March 23, 2022 the Company entered
into an agreement to sell domain name <biontech.com> and other related assets to BioNTech SE (“BNTX”) for the sum of
$950,000 (before expenses related to the transaction) which sale was closed/completed on April 2, 2022 with a one-time gain of $902,490.
The Company has been using www.bionenviro.com as its primary website (and domain) since July 2021 due to the events described
below. The Company has not been using biontech.com as its primary website since July 2021 so domain name <biontech.com>
no longer represented a core asset of the Company.
As previously reported, on Saturday morning, July
17, 2021, our historical website domain – biontech.com – and email services were compromised and disabled. Research
indicated that an unknown party had ‘hijacked’ the domain in a theft attempt. On September 10, 2021, the Company filed a federal
lawsuit ‘in rem’ to recover the <biontech.com> domain and the unknown ‘John Doe’ who hacked and attempted
to steal the website. The litigation was filed in the United States District Court for the Eastern District of Virginia, Alexandria Division
under the heading ‘Bion Environmental Technologies, Inc., Plaintiff, vs John Doe and <biontech.com>, Defendants’ (Case
No. 1:21-cv-01034), seeking recovery of the domain name and other relief as set forth therein.
On November 19, 2021, the United States District Court
for the Eastern District of Virginia, Alexandria Division issued an order stating that “... ORDERED, ADJUDGED and Decreed that
plaintiff Bion Environmental Technologies, Inc. (‘plaintiff) Is the lawful owner of domain name <biontech.com> ....”
under the heading ‘Bion Environmental Technologies, Inc., Plaintiff, vs John Doe and <biontech.com>, Defendants’ (Case
No. 1:21-cv-01034). The Company has moved the domain name <biontech.com> to a new registrar and reactivated it for the Company’s
use (paired currently with its current bionenviro.com website).
No shareholder, sensitive or confidential information
was available to be breached which has limited damages from the hack/theft to date. However, the Company’s email operations were
subject disruption and expenses were incurred related to the matter including legal fees.
The Company created ‘work-arounds’ as
a result. These issues have been resolved and the Company has moved our website (and email) to a new domain: bionenviro.com. Website
access is now www.bionenviro.com. To send emails to Bion personnel, one uses the same name identifier previously used, but in the
address, substitute ‘bionenviro.com’ for “biontech.com’: For example cscott@biontech.com (no longer functional)
is cscott@bionenviro.com and mas@biontech.com (no longer functional) is now mas@bionenviro.com.
ITEM 9B. OTHER INFORMATION
None.
PART III
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.
Our directors, executive officers and significant
employees/consultants, along with their respective ages and positions are as follows:
Name Age Position
Directors and Officers:
Edward T. Schafer 76 Director
Jon Northrop 79 Secretary and Director
William O’Neill 63 Chief Executive Officer
Dominic Bassani 75 Chief Operating Officer
Mark A. Smith (72) currently serves
Bion Environmental Technologies, Inc. as Executive Chairman, President, General Counsel, Chief Financial Officer and a director and has
continually served in senior positions since late March 2003. Since that time, he has also served as sole director, President and General
Counsel of Bion’s wholly-owned subsidiaries including Project Group and Services Group. Since mid-February 2003, Mr. Smith has
served as sole director and President and General Counsel of Bion’s majority-owned subsidiary, Centerpoint Corporation. Mr. Smith
also serves as Manager of Bion PA1, LLC and Bion PA2, LLC. Previously, from May 21, 1999 through January 31, 2002, Mr. Smith served as
a director of Bion. From July 23, 1999, when he became President of Bion, until mid-2001 when he ceased to be Chairman, Mr. Smith served
in senior positions with Bion on a consulting basis. Additionally, Mr. Smith was the president of RSTS Corporation prior to its acquisition
of Bion Technologies, Inc. in 1992. Mr. Smith received a Juris Doctor Degree from the University of Colorado School of Law, Boulder,
Colorado (1980) and a BS from Amherst College, Amherst, Massachusetts (1971). Mr. Smith has engaged in the private practice of law in
Colorado since 1980. In addition, Mr. Smith has been active in running private family companies, Stonehenge Corporation (until 1994),
LoTayLingKyur, Inc. (1994-2002) and LoTayLingKyur, LLC (2007-present). Until returning to Bion during March 2003, Mr. Smith had been
in retirement with focus on charitable work and spiritual retreat. From July 2018 to March 2020 Mr. Smith served as a senior executive
and director at Grow-Ray Technologies, Inc., a private LED lighting company based in Boulder, Colorado, on a consulting basis.
Edward T. Schafer (76) 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. Mr. Schafer had served as a consultant to Bion since July 2010. Mr.
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. Mr. 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. Bush. Mr. Schafer, 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. Mr. 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. Mr. 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 29th United States Secretary of Agricultural from
2008 to 2009. Mr. Schafer holds a Master’s degree in Business Administration from the University of Denver. Mr. 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.
Jon Northrop (79) 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. Mr. Northrop is one of our founders and served as our Chief Executive Officer and a Director from our inception
in September 1989 until August 2001. Before founding Bion Technologies, Inc., he served in a wide variety of managerial and executive
positions. He was the Executive Director of Davis, Graham & Stubbs, one of Denver’s largest law firms, from 1981 to 1989. Prior
to his law firm experience, Mr. Northrop worked at Samsonite Corporation’s Luggage Division in Denver, Colorado, for over 12 years.
His experience was in all aspects of manufacturing, systems design and implementation, and planning and finance, ending with three years
as the Division’s Vice President, Finance. Mr. Northrop has a bachelor’s degree in Physics from Amherst College, Amherst,
Massachusetts (1965), an MBA in Finance from the University of Chicago, Chicago, Illinois (1969), and spent several years conducting post
graduate research in low energy particle physics at Case Institute of Technology, Cleveland.
William O’Neill (63) has served
as Chief Executive officer since May 1, 2022 (he previously held the same position for the period from November 2010 through May 2011).
Mr. O’Neill currently also serves as a director of Wise Up Food, LLC, a privately-held company that provides a transparent supply
chain and real sustainability information for food retailers (including restaurants) enabling consumers to make informed purchase decisions.
He founded Wise Up Food during 2020 and served as its President until May 1, 2022 when his wife assumed that position. From February
2018 through May 2020 he was employed as Vice President Retail & Value-Added Business Teys, USA, as subsidiary of Teys, a large Australian
beef packer. From April 2015 through February 2018 Mr. O’Neill served as Vice President Retail of Colorado Premium Foods. From
1990 through 2015 he held marketing and executive epositions with a variey of companies in the agriculture and food service businesses
with an emphasis on developing/marketing products in the meat industry. Mr. O’Neill graduated from Gettysburg College in 1981 with