Financial Analysis

Not e 9 - 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.

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Note 7 - 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, 2025, or 2024, 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, 2025, or, 2024. 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 6 - Related Party Transactions As of May 31, 2025, and 2024, accruals and current liabilities included accrued officer compensation due to Tom Zapatinas (Chief Executive Officer and a Director of the Company) totaled $ 400,000 and $ 300,000 , respectively. During the years ended May 31, 2025, and 2024, Tom Zapatinas earned $ 100,000 and $ 60,000 , respectively, for consulting services provided to the Company. Advances - Related Par ty As of May 31, 2025, and 2024, advances payable due to Tom Zapatinas totaled $ 101,844 and $ 77,187 , respectively. Advances are non-interest-bearing, unsecured and payable on demand. During the years ended May 31, 2025, and 2024, Tom Zapatinas, the Chief Executive Officer and a Director of the Company, advanced the Company $ 30,534 and $ 13,893 , respectively, in cash and was repaid $ 0 and $ 1,658 , respectively, in cash. Promissory Note - Related Par ty As of May 31, 2025, and 2024, promissory note - related party of $ 466,817 and $ 466,817 , respectively, is due to Tom Zapatinas, the Chief Executive Officer and a Director of the Company. The Note is 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 . Convertible Note Payable - Related Par ty As of May 31, 2025, and 2024, convertible notes payable - related party of $ 1,058,760 is due to Tom Zapatinas, the Chief Executive Officer and a Director of the Company. The Note is non-interest bearing, …

RelatedPartyTransactionsDisclosureTextBlock · excerpt; the full note is in the filing

Note 10 - 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 2024 The Company has been focused on developing Health Savings Account software. During the fiscal years ended May 31, 2025, and 2024, management determined the Company is only operating in one segment but two locations. There are no revenues, and the expenses are split between a Canadian office and the US Holding company. The basic information on segments is as follows: Schedule of segment reporting May 31, 2025 May 31, 2024 $ diff % diff Canadian revenues $ $ $ Canadian expenses (52,524 ) (50,795 ) (1,729 ) 3 % (52,524 ) (50,795 ) (1,729 ) 3 % US revenues US expenses (99,600 ) (48,654 ) (50,946 ) 105 % US Other income 71,470 71,470 Net (28,130 ) (48,654 ) 20,524 -42 % Combined net loss $ (80,654 ) $ (99,449 ) $ 18,795 -19 % …

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"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., and (ii) Zane Inc CA. 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, 2024, and the consolidated statement of cash flows for the year ended May 31, 2024, 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 going concern, which co …

SignificantAccountingPoliciesTextBlock · excerpt; the full note is in the filing

Note 8 - Stockholders' Deficit Common Stock Common Stock, par value of $ 0.001 per share; 75,000,000 shares authorized: 19,767,698 shares issued and outstanding on May 31, 2025, and 2024. Holders of Common Stock have one vote per share of Common Stock held. During the fiscal year ended May 31, 2025, management examined the liability for unissued shares of $ 134,792 . The Company determined that in 2017, $ 126,967 in loans were held back from the debt to stock conversion calculation as a hedge against future settlement. In 2025, the Company determined there is no other settlement coming and the $ 126,967 in loans was applied to additional paid in capital to close out the debt. Additionally, the Company determined that $ 7,825 of the liability for unissued shares is a subscription for 20,000 shares of common stock. This stock will be issued as soon as possible. This debt was reclassified to stock subscriptions to be issued.

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Note 11 - Subsequent Events The Company has evaluated all subsequent events through the date these financial statements were issued. On June 30, 2025, the CEO converted USD $ 1,525,577 in convertible debt into 15,255,770 shares of common stock at $ 0.10 per share. In June 2025, the Company signed a Contractor agreement with INARE, Inc, an Alberta CA company, for the services of Pavel Bondarev to run two (2) subsidiaries and develop new technologies and products for stock and management fees. Pavel Bondarev was also added to the Board of Directors of PreAxia. The Company issued 16,500,000 shares of common stock for the contract at $ 0.10 per share. In June 2025, 1,500,000 shares of stock were issued for services at $ 0.10 per share. In June 2025, the Company reestablished a 2025 Stock Plan for 2,400,000 stock options. In August 2025, the Company received $ 200,000 from the sale of 800,000 shares of common stock in a private placement . In September 2025, the Company established a new subsidiary, Zane Inc US, to market mobile banking and personal finance management platforms in the United States. Pavel Bondarev will run both Zane subsidiaries. In September 2025, the Board of Directors decided to start doing business as PreAxia-Zane Financial.

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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. These agreements started on July 1, 2025. The base compensation for each person is $ 10,000 per month. The initial terms are for three years. As of November 30, 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 $ 450,000 and $ 400,000 , respectively, and related payroll taxes and deductions totaling $ 68,725 and $ 68,725 , respectively. As of November 30, 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 $ 13,415 and $ 0 , respectively. The accrued officers compensation is non-interest bearing and payable or convertible on demand. During the three and six months ended November 30, 2025, and 2024, Tom Zapatinas, earned $ 30,000 and $ 50,000 , and $ 0 and $ 0 , respectively, for executive services provided to the Company and Pavel Bondarev earned $ 30,000 and $ 50,000 , and $ 0 and $ 0 , respectively for contracted management services provided to the Company. Related party loans As of November 30, 2025, and May 31, 2025, the related party loans included advan …

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 November 30, 2025. At November 30, 2025 the assets consist of cash and software development costs. There were no assets at May 31, 2025. In July the Company focus switched to personal financial management software development. During the quarter ended November 30, 2025, management determined the Company is only operating in one 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 locations is as follows: Schedule of segment reporting Assets November 30, 2025 May 31, 2025 $ diff % diff Canadian assets $ 1,409 $ $ 1,409 US assets 199,287 199,287 $ 200,696 $ $ 200,696 Operations November, 2025 November 30, 2024 $ diff % diff Canadian revenues $ $ $ Canadian expenses 527,082 (3,510 ) 530,592 15117 % Net 527,082 (3,510 ) 530,592 15117 % US revenues US expenses 333,588 (14 …

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 and six months ended November 30, 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 …

SignificantAccountingPoliciesTextBlock · excerpt; the full note is in the filing

Note 7 - Stockholders' Equity or 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 November 30, 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 restricted warrants for 16,500,000 shares of common stock at $ 0.10 per share to acquire an exclusive contract with a vendor. Using the Black-Scholes model the employment contract was valued at $778,800. Forty percent (40%) of the vested and were issued issued as of the grant date and sixty percent (60%) of the warrants are being held in escrow to be released over the next three (3) years. The value of the management contract is being amortized to expenses over three (3) years. Also on June 30, 2025, the Company issued restricted warrants for 1,500,000 shares of common stock for past services. The consulting contracts were valued at $70,800. Forty percent (40%) warrants vested and were as of the grant date as consulting expenses and sixty percent (60%) of the warrants are 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. 2025 Stock Plan In connection with the ramp up of operations with the signing of the management contract with INARE, the Company adopted the 2025 Stock Plan, which provides for the issuance of stock optio …

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: 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 March 9, 2026, the Company sold 200,000 shares of common stock for $ 50,000 in cash.

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