Financial Analysis

Note 11 - Contingencies and Commitments From time to time the Company may be a party to litigation matters involving claims against the Company. Management believes that there are no current matters that would have a material effect on the Company's financial position or results of operations. The Company does not have long-term commitments for equipment purchases or leases. The Company presently operates from remote employment sites.

CommitmentsAndContingenciesDisclosureTextBlock

Note 8 Convertible notes related party On April 7, 2026, a related party lent the Company $ 25,000 for a convertible note with 10 % interest and convertible at $ 0.25 at the demand of the holder. The balance for Convertible notes related party on May 31. 2026, and 2025 totaled $ 25,000 and 0 $ respectively. …

DebtDisclosureTextBlock · excerpt; the full note is in the filing

Note 9 - Income Taxes The Company elected to be taxed as a corporation and adopted the provisions of uncertain tax positions as addressed in ASC 740-10-65-1. As a result of the implementation of ASC 740-10-65-1, the Company recognized no increase in the liability for unrecognized tax benefits. The Company has no tax position at May 31, 2026, or 2025, for which the ultimate deductibility is highly certain but for which there is uncertainty about the timing of such deductibility. The Company does not recognize interest accrued related to unrecognized tax benefits in interest expense and penalties in operating expenses. No such interest or penalties were recognized during the period presented. The Company had no accruals for interest and penalties at May 31, 2026, or, 2025. The Companys utilization of any net operating loss carry forward may be unlikely as a result of its intended activities. In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred income tax assets will not be realized. The ultimate realization of deferred income tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred income tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. In general the NOL deduction for tax years beginn …

IncomeTaxDisclosureTextBlock · excerpt; the full note is in the filing

Note 7 - Related party loans Advances - Related Par ty As of May 31, 2026, and 2025, advances payable due to Tom Zapatinas totaled $ 66,837 and $ 101,844 , respectively. Advances are non-interest-bearing, unsecured and payable on demand. During the years ended May 31, 2026, and 2025, Tom Zapatinas, the Chief Executive Officer and a Director of the Company, advanced the Company $ 23,709 and $ 29,662 , respectively, in cash and was repaid $ 58,715 and $ 0 , respectively, in cash. Promissory Note - Related Par ty As of May 31, 2026, and 2025, promissory note - related party of $ 0 and $ 466,817 , respectively, is due to Tom Zapatinas, the Chief Executive Officer and a Director of the Company. The Note was non-interest bearing, unsecured and payable or convertible on demand at a conversion price of $ 0.10 per share, which equates to 4,668,170 shares. This debt was converted on June 30, 2025. Convertible Note Payable As of May 31, 2026, and 2025, convertible notes payable - related party of $ 0 and $ 1,058,760 is due to Tom Zapatinas, the Chief Executive Officer and a Director of the Company. The Note was non-interest bearing, unsecured, payable on demand and convertible in whole or in part into shares of common stock of the Company at a conversion price of $ 0.10 per share, which equates to 10,587,600 shares. This debt was converted on June 30, 2025.

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Note 12 - Segment reporting FASB ASU 2023-07 requires all public entities to expand segment reporting on all significant segments and to report significant segment expenses when the chief operating decision maker uses this information to make decisions about resource allocation. The president and CEO of PreAxia was the chief operating decision maker during fiscal years ended, May 31, 2026, and 2025 The Company has been focused on developing software applications to be initially sold in Canada then in the Unites States. During the fiscal years ended May 31, 2026, and 2025, management determined the Company is only operating in one segment but two regions. There are no revenues, and the expenses are split between a Canadian office and the US Holding company. The basic information on regions is as follows: Schedule of segment reporting Assets May 31, 2026 May 31, 2025 Canadian assets $ 729 $ US assets 582,884 $ 583,613 $ Operations May 31, 2026 May 31, 2025 Canadian revenues $ $ Canadian expenses (670,343 ) (2,329 ) Net (670,343 ) (2,329 ) US revenues US expenses (323,826 ) (147,567 ) US Other income (169,143 ) 70,114 Net (492,969 ) (77,453 ) Combined net loss $ (1,163,312 ) $ (79,782 ) …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing

"Note 2 - Summary of Significant Accounting Policies This summary of significant accounting policies of the Company is presented to assist in understanding the Company's consolidated financial statements. The consolidated financial statements and notes are representations of the Company's management who are responsible for their integrity and objectivity. These accounting policies conform to accounting principles generally accepted in the United States of America and have been consistently applied in the preparation of the consolidated financial statements, which are stated in U.S. Dollars. Principles of Consolidation The consolidated financial statements include the accounts of PreAxia Health Care Systems Inc and its wholly owned subsidiaries (i) PreAxia Health Care Payment Ltd., (ii) Zane Inc CA., and (iii) Zane Inc US. All inter-company accounts and transactions have been eliminated in consolidation. Changes in Classifications of Prior Year Balances. The consolidated balance sheet for May 31, 2025, and the consolidated statement of cash flows for the year ended May 31, 2025, include reclassifications of various liability accounts from previously filed reports. The reclassifications had no impact on the consolidated statements of operations and comprehensive loss and were solely intra-liability reclassifications of AP and related party liabilities. Going Concern The accompanying consolidated financial statements have been prepared assuming the Company will continue as a goi …

SignificantAccountingPoliciesTextBlock · excerpt; the full note is in the filing

Note 10 - Stockholders' Deficit Common Stock Common Stock, par value of $ 0.001 per share; 75,000,000 shares authorized: 44,714,782 and 19,767,698 shares issued and outstanding on May 31, 2026, and 2025, respectively. Holders of Common Stock have one vote per share of Common Stock held. During the fiscal year ended May 31, 2026, management issued 1,800,000 shares of common stock for $ 450,000 in cash. An officer presented $ 1,525,577 in convertible notes and received 15,255,770 shares of common stock. These conversions were within the terms of the agreements and did not result in any gain or loss. Short-term note holders were offered to convert their debt to common stock at 0.25 per share. The note holders converted $ 117,820 in debt to 471,314 shares of common stock in August 2025 These conversions were below market price, and the company recognized $ 164,968 of loss on the conversion. As of May 31, 2026, and 2025, the Company had a liability for a stock subscription of $ 0 and $ 7,825 . On August 31, 2025, the Company issued 20,000 shares for the stock subscription according to the original agreement. The Company recognized $ 4,175 loss on the issuance. Additionally warrants and options for 7,400,000 shares of common stock were exercised from $ 0.001 to $ 0.10 per share. The agreements allowed cashless exercise, so the company recorded stock-based compensation of $ 27,200 on the issuance of the warrants and options. Warrant and option expense of $ 831,174 was recognized ove …

StockholdersEquityNoteDisclosureTextBlock · excerpt; the full note is in the filing

Note 13 - Subsequent Events The Company has evaluated all subsequent events through the date these financial statements were issued. On June 10, 2026, the company issued convertible notes for $ 100,000 and $ 150,000 in cash to two related parties. On July 1, 2026, 3,600,000 warrants were exercised for common stock to contractors for $ 3,600 in services. On July 15, 2026, the Company issued a convertible note for $ 50,000 cash. to a related party. On August 26, 2026, the Company issued a convertible note for $ 50,000 in cash to a related party.

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Note 8 - Contingencies and Commitments From time to time the Company may be a party to litigation matters involving claims against the Company. Management believes that there are no current matters that would have a material effect on the Company's financial position or results of operations. The Company does not have long-term commitments for equipment purchases or leases. The Company does not lease office space as the CEO operates the business from his personal residence. Zane Inc CA started leasing an executive suite on a month-to-month basis in September 2025.

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Note 6 - Related Party Transactions On June 30, 2025, Pavel Bondarev became a director, shareholder, and a related party. Accruals and other liabilities Both Tom Zapatinas and Pavel Bondarev have employment agreements with the Company. As of August 31, 2025, and May 31, 2025, accruals and other current liabilities - related party included accrued officer compensation due to Tom Zapatinas (Chief Executive Officer and a Director of the Company) totaling $ 420,000 and $ 400,000 , respectively, and related payroll taxes and deductions totaling $ 68,725 and $ 68,725 , respectively. As of August 31, 2025, and May 31, 2025, accruals and other current liabilities - related party included accrued officer compensation due to Pavel Bondarev (CEO of Zane Inc and Director of PreAxia) totaling $ 12,661 and $ 0 , respectively. The accrued officers compensation is non-interest bearing and payable or convertible on demand. During the three months ended August 31, 2025, and 2024 , Tom Zapatinas, earned $ 20,000 and $ 0 , respectively, for consulting services provided to the Company and Pavel Bondarev earned $ 20,000 and $ 0 , respectively for contracted management services provided to the Company. Related party loans As of August 31, 2025, and May 31 , 2025, the related party loans included advances payable due to Tom Zapatinas totaled $ 97,708 and $ 1,627,421 , respectively. During the three months ended August 31, 2025, and 2024 , Tom Zapatinas, received $ 8,118 from the Company and provided …

RelatedPartyTransactionsDisclosureTextBlock · excerpt; the full note is in the filing

Note 9 - Segment reporting FASB ASU 2023-07 requires all public entities to expand segment reporting on all significant segments and to report significant segment expenses when the chief operating decision maker uses this information to make decisions about resource allocation. The president and CEO of PreAxia was the chief operating decision maker during fiscal years ended, May 31, 2025, and the quarter ended August 31, 2025 In July the Company focus switched to personal financial management software development. During the quarter ended August 31, 2025, management determined the Company is only operating in one 1 segment but two locations. There are no revenues, and the expenses are split between a Canadian office and the US Holding company. Corporate expenses associated with public reporting, finance, and management are associated with the US holding Company. Software development and office costs are associated with the Canadian subsidiaries. The basic information on segments is as follows: Schedule of segment reporting Assets August 31, 2025 May 31, 2025 Canadian assets $ 43,946 $ US assets 86,337 $ 130,283 $ Operations August 31, 2025 August 31, 2024 Canadian revenues $ $ Canadian expenses (475,487 ) (2,329 ) Net (475,487 ) (2,329 ) US revenues US expenses (100,578 ) (147,567 ) US Other income (169,143 ) 70,114 Net (269,721 ) (77,453 ) Combined net loss $ (745,208 ) $ (79,782 ) …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing

"Note 2 - Summary of Significant Accounting Policies Basis of presentation The unaudited condensed consolidated financial statements of the Company for the three months ended August 31, 2025, and 2024 have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and pursuant to the requirements for reporting on Form 10-Q and Regulation S-K. Accordingly, they do not include all the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. However, such information reflects all adjustments (consisting solely of normal recurring adjustments), which are, in the opinion of management, necessary for the fair presentation of the financial position and the results of operations. Results shown for interim periods are not necessarily indicative of the results to be obtained for a full fiscal year. The balance sheet information as of May 31, 2025 was derived from the audited financial statements included in the Company's financial statements as of and for the fiscal year ended May 31, 2025 included in the Company's Annual Report on Form I0-K filed with the Securities and Exchange Commission (the ""SEC"") on September 30, 2025. These financial statements should be read in conjunction with that report. Principles of Consolidation The consolidated financial statements include the accounts of PreAxia Health Care Systems In …

SignificantAccountingPoliciesTextBlock · excerpt; the full note is in the filing

Note 7 - Stockholders' Deficit Common Stock Common Stock, par value of $ 0.001 per share; 75,000,000 shares authorized: 43,514,782 and 19,767,698 shares issued and outstanding on August 31, 2025, and May 31, 2025, respectively. Holders of Common Stock have one vote per share of Common Stock held. On June 30, 2025, the Company issued warrants for 16,500,000 shares of common stock to acquire an exclusive contract with a vendor. Management used a Black-Scholes model to value the award at $ 778,800 . Forty percent (40%) of the stock was issued as of the grant date and sixty percent (60%) of the stock is being held in escrow to be released over the next three (3) years. The unissued value of the management contract is being amortized to expenses over three (3) years. The Contractor immediately exercised warrant for 6,600,000 shares of common stock. The agreement allowed cashless exercise, so the company recorded stock-based compensation of $ 6,600 on the issuance of the warrants Also on June 30, 2025, 1,500,000 warrants for common stock were issued to contractors for past services. The consulting contracts were valued at $ 70,800 . Forty percent (40%) stock was issued as of the grant date as consulting expenses and sixty percent (60%) of the stock is being held in escrow to be released over the next three (3) years. The unissued value of the consulting contract is being amortized to expenses over three (3) years. The Contractors immediately exercised warrant for 600,000 shares of …

StockholdersEquityNoteDisclosureTextBlock · excerpt; the full note is in the filing

Note 10 - Subsequent Events The Company has evaluated all subsequent events through the date these financial statements were issued, and no other subsequent events occurred that required disclosure, except: On September 11, 2025, the Company created a wholly owned subsidiary in Nevada, named Zane Inc US. This subsidiary will develop and market the personal financial management products and perfect the health care payment processing services. Zane Inc had no operations before October 20, 2025. Zane Inc CA started leasing an executive suite on a month-to-month basis in September 2025. On December 10, 2025, the Company sold 800,000 shares of common stock for $ 200,000 cash. On December 10, 2025, the Company granted 50,000 options to a contractor. On March 6, 2026, a contractor exercised options for 200,000 shares of common stock. The option allowed cashless exercise and $ 20,000 was recorded as stock-based compensation. On March 9, 2026, the Company sold 200,000 shares of common stock for $ 50,000 in cash. On April 7, 2026, a related party lent the Company $ 25,000 for a convertible note with 10 % interest and convertible at $ 0.25 at the demand of the holder. On June 10, 2026, the company issued convertible notes for $ 100,000 and $ 150,000 in cash to two related parties. On July 1, 2026, 3,600,000 warrants were exercised for common stock to contractors for $ 3,600 in services. On July 15, 2026, the Company issued a convertible note for $ 50,000 cash. to a related party. On Aug …

SubsequentEventsTextBlock · excerpt; the full note is in the filing