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 2024-03-01

 UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 FORM 10-K

 (Mark One)

 [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR
15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 For the fiscal year ended May 31, 2024

 or

 [ ] TRANSITION REPORT PURSUANT TO
SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 For the transition period from ________________
to________________

 Commission file number 000-53490

 PREAXIA HEALTH CARE PAYMENT SYSTEMS INC.

(Exact name of registrant as specified in its charter)

 Nevada

 20-4395271

 (State or other jurisdiction of

 (I.R.S. Employer

 incorporation or organization)

 Identification No.)

 PO Box 34075 Westbrook PO, 1610-37 th Street S.W., Calgary, Alberta T3C 3W2

 (Address of principal executive offices) (Zip Code)

 Registrant's telephone number, including
area code ( 403) 850-4120

 Securities registered pursuant to Section 12(b)
of the Act:

 Title of each class

 Trading Symbol(s)

 Name of each exchange on which registered

 None

 None

 N/A

 Securities registered pursuant to Section 12(g) of
the Act:

 Common Stock, $0.001 par value
(Title of class)

 Indicate by check mark if the registrant is
a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Yes [ ] No [X]

 Indicate by check mark if the registrant is
not required to file reports pursuant to Section 13 or Section 15(d) of the Act.

Yes [ ] No [X]

 Indicate by check mark whether the registrant (1)
has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements
for the past 90 days.

 Yes [X] No [ ]

 Indicate by check mark whether the registrant has
submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of
this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

 Yes [ X ] No [ ]

 Indicate by check mark if disclosure of delinquent
filers pursuant to Item 405 of Regulation S-K (§ 229.405 of this chapter) is not contained herein, and will not be contained, to
the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this
Form 10-K or any amendment to this Form 10-K. [X ]

 Indicate by check mark whether the registrant is a
large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See
definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging
growth company" in Rule 12b-2 of the Exchange Act.

 Large accelerated filer [ ]

 Accelerated filer [ ]

 Non-accelerated filer [X]

 Smaller reporting company [X]

 Emerging growth company [ ]

 If an emerging growth company, indicate
by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial
accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]

 Indicate by check mark whether the registrant is a
shell company (as defined in Rule 12b-2 of the Act).

Yes [ ] No [X]

 Indicate
by check mark whether the registrant has filed a report on and attestation to its management's assessment of the effectiveness of
its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public
accounting firm that prepared or issued its audit report. [ ]

 [ ]

 State the aggregate market value of the voting and
non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average
bid and asked price of such common equity, as of the last business day of the registrant's most recently completed second fiscal
quarter. Approximately $ 494,059 on November 30, 2023.

 (APPLICABLE ONLY TO CORPORATE REGISTRANTS)

 Indicate the number of shares outstanding of each of the registrant's
classes of common stock, as of the latest practicable date:

shares of common stock as of October 10, 2024

 DOCUMENTS INCORPORATED BY REFERENCE

 Not Applicable.

 FORWARD-LOOKING STATEMENTS.

 ITEM 1. BUSINESS

 ITEM 1A. RISK FACTORS

 ITEM 1B. UNRESOLVED STAFF COMMENTS

 ITEM 2. PROPERTIES

 ITEM 3. LEGAL PROCEEDINGS

 ITEM 4. MINE SAFETY DISCLOSURES

 ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

 ITEM 6. SELECTED FINANCIAL DATA

 ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

 ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

 ITEM 9A. CONTROLS AND PROCEDURES

 ITEM 9B. OTHER INFORMATION

 ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

 ITEM 11. EXECUTIVE COMPENSATION

 ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

 ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

 ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES

 ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES

 ITEM 16. FORM 10-K SUMMARY

 SIGNATURES

 FORWARD-LOOKING STATEMENTS.

 This annual report contains forward-looking
statements. Forward-looking statements are projections in respect of future events or our future financial performance. In some cases,
you can identify forward-looking statements by terminology such as "may," "should," "intend," "expect,",
"plan," "anticipate," "believe," "estimate," "predict," "potential,"
or "continue" or the negative of these terms or other comparable terminology. These statements are only predictions and involve
known and unknown risks, including uncertainties and other factors, which may cause our or our industry's actual results, levels
of activity or performance to be materially different from any future results, levels of activity or performance expressed or implied
by these forward-looking statements. These risks and uncertainties include: a continued downturn in international economic conditions;
any adverse occurrence with respect to the development or marketing of our product; any adverse occurrence with respect to any of our
licensing agreements; our ability to successfully bring products to market; product development or other initiatives by our competitors;
fluctuations in the availability and cost of materials required to produce our products; any adverse occurrence with respect to distribution
of our products; potential negative financial impact from claims, lawsuits and other legal proceedings or challenges; and other factors
beyond our control.

 Although we believe that the expectations reflected
in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity or performance. Except as required
by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements
to conform these statements to actual results.

 As used in this annual report, the terms "we,"
"us," "our," the "Corporation," and "PreAxia" mean PreAxia Health Care Payment Systems
Inc. and our and its wholly owned subsidiaries (i) PreAxia Health Care Payment Systems Inc., incorporated pursuant to the laws of the
Province of Alberta on January 28, 2008 (ii) PreAxia Canada Inc., incorporated pursuant to the laws of the Province of Alberta on January
28, 2008 and (iii) PreAxia Health Care Payment Ltd., incorporated pursuant to the laws of the Province of Alberta on November 26, 2015
(collectively, the "Subsidiaries"), unless the context clearly requires otherwise. Unless otherwise stated, "$"
refers to United States dollars.

 ITEM 1. BUSINESS

 Corporate Overview

 PreAxia Health Care Payment Systems Inc. (the
"Company" or "PreAxia") was incorporated on April 3, 2000 in the State of Nevada.

 The Company primarily undertakes its operations
through its wholly owned subsidiary, PreAxia Health Care Payment Limited ("PreAxia Payment"). PreAxia Payment was incorporated
pursuant to the laws of the Province of Alberta on November 26, 2015.

 General Overview

 PreAxia Payment is a company which intends
to deliver a comprehensive suite of solutions and services directed at the emerging health payment market, specifically the opportunities
tied to the growth of health spending accounts ("HSA"). There is a rapid shift in healthcare traditional payment models to
consumer-directed healthcare that is creating significant opportunities for financial services and insurance industries to deliver new
dynamic products to this emerging market.

 Spawned by the need to address escalating health
care costs, changes in the regulatory environment and the growing consumer desire for greater participation in the management of their
health benefits, the boundaries between health care and the financial services industries are becoming increasingly blurred. With the
trend towards self-directed health payment solutions and the growing demand for faster, easier and more convenient benefit services, the
insurance and benefits industries are banking on HSA medical payments being their next big growth conduit. Studies suggest that HSAs in
the US reached $123.3 billion in assets in 2023 and 34.7 million consumers in 2023, an increase of more than 18% of assets over the prior
year. This coupled with the continued growth of the Canadian group insurance industry illustrates the emerging opportunity for innovative
health payment services. We intend to initially launch our products in Canada. We believe that Canadian businesses are embracing a new
healthcare financing vehicle to provide greater value to employees, increase profitability and get more return from their investment.
We intend to provide them with services to capture this market opportunity.

 Description of Health Spending Account ("HSA")

 An HSA is a uniquely designed account established
exclusively and specifically for the purpose of health care spending. An employer deposits funds into a special account for the employee.
These funds can be used to pay for eligible medical and related health care expenses for the employee and their dependents. HSAs provide
employers and employees with greater control in both the amount of funds invested and how these funds are used.

 Services and infrastructure provided by PreAxia enable
organizations and individuals to eliminate all paper involved in the management of these accounts and benefit through savings in time
and money.

 The PreAxia platform for processing and managing accounts,
including cardholder and customer account management, reconciliation and financial settlement, and customer reporting is fully operational.

 Over time, the Company will evaluate opportunities
for forms of virtual banking and PayPal-type services. One opportunity seen as particularly relevant to the health care market is to offer
instant issuing services that enable corporations to issue and fund Pre-Paid Interac or credit card services to beneficiaries in real
time. If implemented, the beneficiary will most likely select a personal identification number ("PIN") using a PIN and card
activation terminal, thus gaining instant access to funds that can be reloaded. This consideration would require development of software
systems for the issuing of health payment cards and financial transaction processing services that would be fully managed by a data center.

 Matching of consumers in need of health care
products or services with providers is another area PreAxia intends to evaluate. Consumers managing their health care dollars through
an online system will find convenience in seeking out health care professionals and services through the same system.

 Distribution Methods and Marketing Strategy

 PreAxia operates on a Cloud Computing Platform
that makes it accessible to anyone with a personal computer and Internet access. The preliminary market for PreAxia's HSA Management
Solution is small and medium sized companies that are not currently well served by the current group benefits model. The financial benefits
of the PreAxia business model, however, are also relevant to larger employers and we believe that these larger employers will migrate
to the PreAxia product over time.

 PreAxia's marketing strategy is to promote
its existing platform direct to consumers and businesses, and to the groups that most need access to its independent brokers, financial
advisors and small to medium sized businesses. Brokers should see PreAxia as a superior method of promoting and supporting HSAs that allow
them to earn above average commission rates on invested funds. Financial advisors should see PreAxia in a similar way as brokers except
that there is the additional benefit of tax reduction. Small to medium sized businesses, which are expected to drive the growth in business,
should see PreAxia as offering financial savings to the company and to employees by offering personal health care benefits through an
HSA, along with the same conveniences they have come to expect from other services they currently utilize over the Internet. It is expected
that the group benefits market will subsequently follow as they too realize the advantages of PreAxia over their current HSA offerings.
PreAxia has begun and will continue to seek opportunities with lead customers and alliance partners to establish reference-able, high-profile
implementations and market-leading, early-adopter firms for further developing innovative products and services. The Company intends to
design solutions targeted towards corporate financial management, financial risk, audit management and cash management while targeting
product/service management as a support to financial management.

 We anticipate that the prime target for services
will be small to medium sized organizations that are not adequately served by the current insurance and group benefits offerings. These
organizations should realize significant benefits in both cost and time savings by utilization of PreAxia technology while providing their
employees with an increased level of benefits.

 PreAxia intends to achieve service volume and
the associated economies of scale through marketing directly to select target customers that provide the necessary transaction volumes,
through market specific channel partners and through an education based public relations strategy geared to the small to mid-sized employers
including the brokers and financial advisors utilized by these businesses. The channel strategy is supported in the solution design, as
multiple channel partners may require custom pricing and compensation.

 It is our Company's intention that brokers
and financial advisors will aggressively promote their PreAxia supported HSA offerings due to the quality of product, higher margins and
because of the non-competitive relationship with PreAxia.

 PreAxia has identified the following "channels"
through which it will target prime end market customers:

 Independent brokers that sell, or desire to sell, Health Spending Accounts

 Financial advisors who manage funds and advise on tax saving strategies for individuals and corporations

 Accountants and bookkeepers who regularly advise businesses on financial and operational matters

 Benefits managers/adjudicators, including insurance, health or outsourced government benefits processors that manage benefits disbursement

 Issuer banks, including partner banks that enable the issuance of Health Cards and/or sell insurance products

 Application providers, including software manufacturers selling into the target vertical markets

 Professional services, including consulting, development and implementation companies serving the target vertical markets

 PreAxia intends to establish several key
customer reference accounts, channel marketing partners and technology alliances. These corporate relationships are relevant to advancing
our company's goals in 2025 and beyond for achieving a prime position in the Canadian marketplace and establishing a solid service
foundation.

 Competitive Business Conditions and our Company's
Competitive Position in the Industry and Methods of Competition

 PreAxia intends to offer a combination of products
and services in its solution. However, there are other providers of components or versions of the Health Spending Accounts in the marketplace.
Our approach is to provide a high value added and robust capability within specific target markets, rather than the "one size fits
all" and mass volume approach of the larger companies in the Canadian and international market. This is consistent with the PreAxia
platform which has been designed for expansion in the United States and internationally. The following are some of the leading providers
of products and services that are or may be potential competitors in PreAxia's target markets:

 Benecaid has become a leading provider of Health Spending Accounts in Canada by offering an easy-to-understand
product through brokers and also directly through the company.

 Olympia Benefits has become a leading provider of Health Spending Accounts in Canada by offering a "Cost
Plus" version of HSAs that has become popular in the marketplace.

 QuickCard is a provider of Health Spending Accounts and group insurance products. They are partially
differentiated from competitors by virtue of a "credit type card" that is used to pay for qualified health products and services.

League, which operates in Canada and the US, offers a range of health benefit services including
Health Spending Accounts.

 Most major insurance companies offer some version of HSAs to their customers.

 Many brokers have created HSA products for their clients.

 Many accounting and financial services firms have created their own HSA products to offer to their clients.

 US and International Markets

 HealthEquity, a publicly listed company offering HSAs in the USA, manages over $22 billion in deposits.
It is one of the largest dedicated health account custodians in the USA and serves more than 12 million accounts owned by individuals
at more than 24,000 companies across the country.

 HSA Bank, a division of Webster Bank, offers Health Spending Accounts and related offerings to the consumer-directed
healthcare industry.

 Fidelity Investments offers a Health Spending Account to businesses as a means of controlling costs
while providing employee health benefits.

 Intellectual Property and Patent Protection

 At present, PreAxia does not have any pending or registered
patents or any trademarks.

 Research and Development

 For the year ended May 31, 2024 and 2023, we incurred
$5,632 and $6,528 in research and development expenses.

 Employees

 PreAxia has one full-time consultant, our President,
Mr. Tom Zapatinas effective September 1, 2011. We anticipate that we will hire additional key staff throughout 2024 and 2025 in areas
of administration/accounting, business development, operations, sales/marketing and research/development.

 ITEM 1A. RISK FACTORS

 Not applicable to smaller reporting companies.

 ITEM 1B. UNRESOLVED STAFF COMMENTS

 Not applicable.

 ITEM 2. PROPERTIES

 Although much of the research and development
and the building of our system have been completed, our Calgary office closed during the 2017 fiscal year, and we presently operate out
of remote employment sites.

 ITEM 3. LEGAL PROCEEDINGS

 We know of no material, active or pending legal
proceedings against our company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings
in which any of our directors, officers or affiliates, or any registered or beneficial shareholder, is an adverse party or has a material
interest adverse to our interest.

 ITEM 4. MINE SAFETY DISCLOSURES

 Not applicable.

 ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED
STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

 Market Information

 Our common stock is quoted on the OTC Markets Pink Sheets under
the symbol PAXH.

 Following is a report of high and low bid prices for each quarterly
period for the years ended May 31, 2024 and 2023.

 Quarter Ended

 High

 Low

 05/31/2024

 02/28/2024

 11/30/2023

 08/31/2023

 05/31/2023

 02/28/2023

 $0.45

 11/30/2022

 08/31/2022

 $0.25

 Holders of Our Common Stock

 As of October 10, 2024, there were 83 holders of record of our
common stock and 19,767,698 shares of common stock outstanding.

 There is currently only one class of common stock with one vote
per share.

 Pacific Stock Transfer Company of 6725 Via Austin Parkway, Suite
300, Las Vegas, Nevada 89119, is the registrar and transfer agent for our common shares.

 Dividends

 We have not declared or paid dividends on shares
of our common stock and we do not expect to declare or pay dividends on shares of our common stock for the foreseeable future. We intend
to retain earnings, if any, to finance the development and expansion of our business. Our future dividend policy will be subject to the
discretion of our board of directors and will depend upon our future earnings, if any, our financial condition, and other factors deemed
relevant by the board.

 Equity Compensation Plans

 We adopted and approved our current stock option plan on January
28, 2010. The following table provides a summary of the number of options granted under our stock option plan, the weighted average exercise
price and the number of options remaining available for issuance all as of May 31, 2024.

Number of securities to

be issued upon exercise

of outstanding options,

warrants and rights

Weighted-average

exercise price of

outstanding options,

warrants and rights

 Number of securities

remaining available for

future issuance under

equity compensation

plans

 Equity compensation plans approved by security holders

 None

 N/A

 2,000,000

 Equity compensation plans not approved by security holders

 None

 N/A

 None

 Total

 None

 N/A

 2,000,000

 Recent Sales of Unregistered Securities

 We have not sold any equity securities that were not
registered under the Securities Act of 1933 that were not previously reported in a quarterly report on Form 10-Q or in a current report
on Form 8-K during the fiscal year ended May 31, 2024.

 Purchases of Equity Securities by the Issuer and Affiliated
Purchasers

 We did not purchase any of our shares of common
stock or other securities during our fiscal years ended May 31, 2024 or 2023.

 ITEM 6. SELECTED FINANCIAL DATA

 Not Applicable.

 ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS

 General Overview

 Corporate Overview

 PreAxia Health Care Payment Systems Inc. (the
"Company" or "PreAxia") was incorporated on April 3, 2000 in the State of Nevada.

 The Company primarily undertakes its operations
through its wholly owned subsidiary, PreAxia Health Care Payment Limited ("PreAxia Payment"). PreAxia Payment was incorporated
pursuant to the laws of the Province of Alberta on November 26, 2015.

 General Overview

 PreAxia Payment is a company which intends
to deliver a comprehensive suite of solutions and services directed at the emerging health payment market, specifically the opportunities
tied to the growth of health spending accounts ("HSA"). There is a rapid shift in healthcare traditional payment models to
consumer-directed healthcare that is creating significant opportunities for financial services and insurance industries to deliver new
dynamic products to this emerging market.

 Spawned by the need to address escalating
health care costs, changes in the regulatory environment and the growing consumer desire for greater participation in the management
of their health benefits, the boundaries between health care and the financial services industries are becoming increasingly blurred.
With the trend towards self-directed health payment solutions and the growing demand for faster, easier and more convenient benefit services,
the insurance and benefits industries are banking on HSA medical payments being their next big growth conduit. Studies suggest that HSAs
in the US reached $123.3 billion in assets in 2023 and 37.4 million consumers in 2023, an increase of more than 18% of assets over the
prior year. This coupled with the continued growth of the Canadian group insurance industry illustrates the emerging opportunity for
innovative health payment services. We intend to initially launch our products in Canada. We believe that Canadian businesses are embracing
a new healthcare financing vehicle to provide greater value to employees, increase profitability and get more return from their investment.
We intend to provide them with services to capture this market opportunity.

 Plan of Operation

 Over the next twelve months, we plan to:

 (a)

 Raise additional capital to execute our business plans;

 (b)

 Penetrate the health care processing markets in Canada, the United States and worldwide, by continuing to develop innovative health care processing products and services;

 (c)

 Build up a network of strategic alliances with several types of health insurance companies, governments and other alliances in various vertical markets, and;

 (d)

 Fill the positions of senior management sales, administrative and engineering positions.

 Liquidity and Capital Resources

 As of May 31, 2024, PreAxia's cash balance was
$14 compared to $6 as of May 31, 2023. Our Company will be required to raise capital to fund our operations. PreAxia
had a working capital deficit of $2,396,179 as of May 31, 2024, compared with a working capital deficit of $2,296,730 as of May 31, 2023.

 Our ability to meet our financial liabilities and
commitments is primarily dependent upon the continued issuance of equity to new stockholders and our ability to achieve and maintain profitable
operations. PreAxia's cash and cash equivalents will not be sufficient to meet its working capital requirements for the next
twelve-month period. We will not initially have any cash flow from operating activities as we are in the startup stage. We
project that we will require an estimated $1,000,000 over the next twelve-month period to pay our arms-length creditors approximately
$300,000 plus an additional $700,000 to complete our business plan. The Company plans to raise the capital required to satisfy our
immediate short-term needs and additional capital required to meet our estimated funding requirements for the next twelve months primarily
through the private placement of our equity securities or by way of loans or such other means as PreAxia may determine.

 There are no assurances that we will be able to obtain
the funds required for our continued operations. There can be no assurance that additional financing will be available to us
when needed or, if available, that it can be obtained on commercially reasonable terms. If we are not able to obtain the additional
financing on a timely basis, we will not be able to meet our other obligations as they become due, and we will be forced to scale down
or perhaps even cease the operation of our business.

 There is substantial doubt about our ability to continue
as a going concern as the continuation of our business is dependent upon obtaining further long-term financing, successful and sufficient
market acceptance of our products and achieving a profitable level of operations. The Company hopes to be able to attract suitable
investors for our business plan, which will not require us to use our cash. There can be no assurance that the Company will be successful
in this situation. The issuance of additional equity securities by us could result in a significant dilution in the equity interests of
our current stockholders. Obtaining commercial loans, assuming those loans would be available, will increase our liabilities
and future cash commitments.

 Our working capital (deficit) as of May 31, 2024 and
2023 is summarized as follows:

 Working Capital

 May 31, 2024

 May 31, 2023

 Current Assets

 $

 $

 Current Liabilities

 (2,396,193
)

 (2,296,736
)

 Working Capital (Deficit)

 $
 (2,396,179
)

 $
 (2,296,730
)

 The increase in our working capital deficit of $99,449
was primarily due to increases in accrued liabilities – related party of $60,000 and loans payable - shareholders of $18,263.

 Off-balance Sheet Arrangements

 We have no off-balance sheet arrangements that have
or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses,
results of operations, liquidity, capital expenditures or capital resources that is material to stockholders.

 Results of Operations – Years ended May
31, 2024 and 2023

 For the years ended May 31, 2024 and 2023

 Our operating results for the years ended May 31,
2024 compared to the years ended May 31, 2023 are described below:

 Revenue

 During the years ended May 31, 2024 and
2023, the Company had revenue of $0 and $0, respectively. The Company earns a 10% commission on amounts reimbursed for eligible expenses.

 Expenses

 Our total expenses for the year ended May 31, 2024
were $99,449 compared to $156,266 for the year ended May 31, 2023. The decrease in total expenses of $56,817 for the year ending May 31,
2024 is due to a decrease in consulting fees of $60,442, increase in professional fees of $3,150, an increase of $1,371 in office and
administration fees, and a decrease in research and development of $896.

 Consulting Fees

 During each of the years ended May 31, 2024 and 2023,
Tom Zapatinas, the Chief Executive Officer and Director of the Company, earned $60,000 and $120,000, respectively, for consulting services
provided to the Company, which is included in accounts payable and accrued liabilities – related party. During the period from
December 1, 2023 to May 31, 2024, the Company did not accrue compensation to Tom Zapatinas.

 Research and Development

 Research and development expenses during the year
ended May 31, 2024 decreased by $896 to $5,632, as compared to $6,528 during the year ended May 31, 2023. The decrease is due to a decrease
in software lease expenses from Microsoft.

 Wages and Benefits

 There were no wages and benefits during the years
ended May 31, 2024 and 2023.

 Office and Administration

 Office and administration expenses increased by $1,371 for
the year ended May 31, 2024 due to an increase in office supply expense and filing fees.

 Professional Fees

 Professional fees during the year ended May 31, 2024
increased by $3,150 to $18,654, as compared to $15,504 during the year ended May 31, 2023. Professional fees increased due to an increase
in costs related to accounting assistance.

 Interest Expense

 Interest expense is $0 for the years ended May 31,
2024 and 2023 because accounts payable and accrued liabilities – related party, convertible note payable – related party and
loans payable – shareholders are non-interest bearing.

 Critical Accounting Policies

 We have identified certain accounting policies, described
below, that are the most important to the portrayal of our current financial condition and results of operations. Please refer to Note
2 of the accompanying consolidated financial statements for a full and complete disclosure of our accounting policies.

 ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK

 Not applicable.

 ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

 Page

 Report of Independent Public Accounting Firm (ID 6580)

 Audited Consolidated Financial Statements

 Consolidated Balance Sheets

 Consolidated Statements of Operations and Comprehensive Loss

 Consolidated Statements of Changes in Stockholders' Deficit

 Consolidated Statements of Cash Flows

 Notes to Consolidated Financial Statements

 F-7 to F-11

 REPORT OF INDEPENDENT REGISTERED
PUBLIC ACCOUNTING FIRM

 To the Board of Directors and Stockholders

 Preaxia
Healthcare Payment Systems Inc.

 Calgary, Alberta CA

 Opinion
on the Financial Statements

 We
have audited the accompanying consolidated balance sheets of Preaxia Healthcare Payment Systems Inc. (the Company) as of May 31, 2024
and 2023, and the related consolidated statements of operations and comprehensive loss, stockholders' deficit, and cash flows for
the years then ended, and the related notes (collectively referred to as the financial statements). In our opinion, the financial statements
present fairly, in all material respects, the financial position of the Company as of May 31, 2024 and 2023, and the results of its operations
and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America.

 Going
Concern Considerations

 The
accompanying financial statements have been prepared assuming that the Company will continue as a going concern. The Company has suffered
recurring losses since inception, has a working capital deficit, and has not achieved profitable operations, which raises substantial
doubt about its ability to continue as a going concern. Management's plans in regard to these matters are described in Note 2.
The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

 Basis
for Opinion

 These
financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's
financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board
(United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities
laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

 We
conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain
reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company
is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits,
we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion
on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.

 Our
audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error
or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding
the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant
estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits
provide a reasonable basis for our opinion.

 F- 1

 Critical
Audit Matters

 Critical
audit matters are matters arising from the current period audit of the financial statements that were communicated or required to be
communicated to the audit committee and that (1) relate to accounts or disclosures that are material to the financial statements and
(2) involved our especially challenging, subjective, or complex judgments. We determined that there were no critical audit matters.

 GreenGrowthCPAs

 PCAOB
 ID Number 6580

 We have served as the Company's auditor since 2023.

 Los Angeles, California

 October 10, 2024

 F- 2

 PREAXIA
 HEALTHCARE PAYMENT SYSTEMS INC.

 CONSOLIDATED
 BALANCE SHEETS

 May
 31, 2024

 May
 31, 2023

 ASSETS

 Current assets

 Cash

 $

 $

 Total current assets

 Total assets

 $

 $

 LIABILITIES

 Current liabilities

 Bank indebtedness

 $

 $
 —

 Accounts payable and accrued liabilities

 166,909

 158,348

 Accounts payable and accrued liabilities - related
 party

 300,000

 240,000

 Advances - related party

 77,187

 64,952

 Loans payable - shareholders

 191,330

 173,067

 Liability for unissued shares

 134,792

 134,792

 Promissory note - related party

 466,817

 466,817

 Convertible note payable - related
 party

 1,058,760

 1,058,760

 Total current liabilities

 2,396,193

 2,296,736

 Total liabilities

 2,396,193

 2,296,736

 Commitments and Contingencies

 —

 —

 STOCKHOLDERS' DEFICIT

 Common Stock, $ 0.001 par value, 75,000,000 shares authorized 19,767,698 shares issued and outstanding

 Additional paid-in capital

 Accumulated other comprehensive income

 Accumulated deficit

 ( 5,128,380
)

 ( 5,028,931
)

 Total stockholders' deficit

 ( 2,396,179
)

 ( 2,296,730
)

 Total liabilities and stockholders' deficit

 $

 $

 See Accompanying Notes to the Consolidated Financial Statements

 F- 3

 PREAXIA
 HEALTHCARE PAYMENT SYSTEMS INC.

 CONSOLIDATED
 STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

 Years
 ended

 May
 31, 2024

 May
 31, 2023

 Revenue

 $
 —

 $
 —

 Operating expenses

 Consulting

 60,000

 120,442

 Professional

 18,654

 15,504

 Office and administration

 15,163

 13,792

 Research and development

 5,632

 6,528

 Total operating expenses

 99,449

 156,266

 Loss from operations

)

)

 Net loss and comprehensive loss

 $
)

 $
)

 Net loss per share - basic and diluted

 $
 ( 0.01
)

 $
 ( 0.01
)

 Weighted average number of common shares outstanding
 - basic and diluted

 See Accompanying Notes to the Consolidated Financial Statements

 F- 4

 PREAXIA HEALTHCARE PAYMENT SYSTEMS INC.

 CONSOLIDATED STATEMENTS OF CHANGES IN
 STOCKHOLDERS' DEFICIT

 Additional
 Paid-in

 Accumulated
 Other Comprehensive

 Accumulated

 Total
 Stockholders'

 Shares

 Amount

 Capital

 Income

 Deficit

 Deficit

 Balance, May 31, 2023

 $

 $

 $

 $
 ( 5,028,931
)

 $
 ( 2,296,730
)

 Net loss and comprehensive loss

 —

 —

 —

 —

)

)

 Balance, May 31, 2024

 $

 $

 $

 $
 ( 5,128,380
)

 $
 ( 2,396,179
)

 Additional
 Paid-in

 Accumulated
 Other Comprehensive

 Accumulated

 Total
 Stockholders'

 Shares

 Amount

 Capital

 Income

 Deficit

 Deficit

 Balance, May 31, 2022

 $

 $

 $

 $
 ( 4,872,665
)

 $
 ( 2,140,464
)

 Net loss and comprehensive loss

 —

 —

 —

 —

)

)

 Balance, May 31, 2023

 $

 $

 $

 $
 ( 5,028,931
)

 $
 ( 2,296,730
)

 See Accompanying Notes to the Consolidated Financial Statements

 F- 5

 PREAXIA
 HEALTHCARE PAYMENT SYSTEMS INC.

 CONSOLIDATED
 STATEMENTS OF CASH FLOWS

 Year
 ended

 May
 31, 2024

 May
 31, 2023

 Cash flows from operating activities

 Net loss

 $
)

 $
)

 Change in operating assets and liabilities

 Increase in accounts payable and accrued liabilities
 - related party

 60,000

 120,000

 Increase (decrease) in accounts
 payable and accrued liabilities

 8,561

 ( 1,351
)

 Cash flows used in operating
 activities

 ( 30,888
)

 ( 37,617
)

 Cash flows from investing activities

 —

 —

 Cash flows from financing activities

 Bank indebtedness

 —

 Advances - loans payable - shareholders

 18,263

 4,992

 Advances - related party

 13,893

 33,157

 Repayment of advances - related
 party

 ( 1,658
)

 ( 785
)

 Net cash provided by financing
 activities

 30,882

 37,364

 Net change in cash

 ( 253
)

 Cash, beginning of the period

 Cash, end of the period

 $

 $

 Supplemental Disclosure:

 Cash paid for income taxes

 $
 —

 $
 —

 Cash paid for interest

 $
 —

 $
 —

 See Accompanying Notes to the Consolidated Financial Statements

 F- 6

 PREAXIA HEALTH CARE PAYMENT SYSTEMS INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

May 31, 2024 and 2023

 Note 1 – Organization and Description of
Business

 PreAxia Health Care Payment Systems Inc. (the "Company"
or "PreAxia") was incorporated on April 3, 2000 in the State of Nevada. On May 31, 2005, the Company acquired all of the outstanding
stock of Tiempo de Mexico Ltd. ("Tiempo") in exchange for 5,000,000 shares of the common stock of the Company with a par value
of $ 0.001. The Company had no operations prior to the date of the aforementioned acquisition.

 The business objective of the Company is the development,
distribution, marketing and sale of health care payment processing services and products. The Company has realized only nominal revenues
from its planned operations.

 The operations of the Company are expected to be primarily
undertaken by its wholly owned subsidiary, PreAxia Health Care Payment Ltd. ("PreAxia Payment"), incorporated pursuant to
the laws of the Province of Alberta on November 26, 2015.

 PreAxia Payment is in the process of developing an
online access system creating a health spending account that will facilitate card payment and processing services to third-party administrators,
insurance companies and others.

 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 the Company and its wholly-owned subsidiaries (i) PreAxia Health Care Payment Systems Inc., incorporated pursuant to the laws
of the Province of Alberta on January 28, 2008 (ii) PreAxia Canada Inc., incorporated pursuant to the laws of the Province of Alberta
on January 28, 2008 and (iii) PreAxia Health Care Payment Ltd., incorporated pursuant to the laws of the Province of Alberta on November
26, 2015 (collectively, the "Subsidiaries"). All inter-company accounts and transactions have been eliminated in consolidation.

 Going Concern

 The accompanying consolidated financial statements
have been prepared assuming the Company will continue as a going concern, which contemplates the realization of assets and satisfaction
of liabilities in the normal course of business. During the year ended May 31, 2024, the Company incurred a net loss of $ 99,449 and used
cash in operating activities of $ 30,888, and as of May 31, 2024, had a stockholders' deficit of $ 2,396,179 and an accumulated deficit
of $ 5,128,380. These factors, among others, raise substantial doubt about the Company's ability to continue as a going concern within
one year of the date that the consolidated financial statements are issued. The Company's consolidated financial statements do not
include any adjustments that might result from the outcome of this uncertainty should we be unable to continue as a going concern.

 The Company's ability to continue as a going
concern is dependent upon its ability to develop additional sources of capital and to ultimately achieve profitable operations. Currently,
the Company does not have significant cash or other material assets, nor does it have operations or a source of revenue sufficient to
cover its operating costs and allow it to continue as a going concern. The Company's officers or principal shareholders are committed
to making advances or loans to pay for certain legal, accounting, and administrative costs.

 The Company hopes to be able to attract suitable investors
for our business plan, which will not require us to use our cash. There can be no assurance that the Company will be successful in this
situation. Even if the Company is able to obtain additional financing, it may contain undue restrictions on our operations, in the case
of debt financing, or cause substantial dilution for our stockholders, in the case of equity financing.

 Cash and Cash Equivalents

 The Company considers all highly liquid debt instruments
with an original maturity of three months or less to be cash equivalents.

 Use of Estimates

 The preparation of the Company's consolidated
financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates
and assumptions that affect the amounts reported in these consolidated financial statements and accompanying notes. Although these estimates
are based on management's knowledge of current events and actions that our company may undertake in the future, actual results could
differ from those estimates.

 F- 7

 Foreign Currency Translation

 The functional currency of the Company is the United
States dollar. The functional currency of the Subsidiaries is the Canadian dollar. Assets and liabilities in the accompanying consolidated
financial statements are translated into United States dollars at the exchange rate in effect at the balance sheet date and capital accounts
are translated at historical rates. Income statement accounts are translated at the average rates of exchange prevailing during the period.
Translation adjustments arising from the use of differing exchange rates from period to period are included in the accumulated other comprehensive
income (loss) account in stockholders' deficit.

 Transactions undertaken in currencies other than the
functional currency of the entity are translated using the exchange rate in effect as of the transaction date. Any transaction exchange
gains and losses are included in the statement of operations and comprehensive loss.

 The Company's reporting currency is the U.S. dollar.
All transactions initiated in Canadian Dollars are translated into U.S. dollars in accordance with Accounting Standards Codification ("ASC")
830-30, "Translation of Financial Statements," as follows:

 i)
 assets and liabilities are translated at the closing rate at the date of
the balance sheet of 1.00 US Dollar = 1.3643 Canadian Dollars (May 31, 2024), 1.00 USD Dollar= 0.7852 GBP, and 1.00 US Dollar= 1.3605 Canadian
Dollars (May 31, 2023), 1.00 USD Dollar= 0.593 GBP;

 ii)
 income and expenses are translated at average exchange rates for the year
ended May 31, 2024 of 1.00 US Dollar = 1.3515 Canadian Dollars and 1.00 US Dollar = 1.3351 Canadian Dollars (May 31, 2023);

 iii)
 all resulting exchange differences are recognized as other comprehensive
income, a separate component of equity. The exchange differences during the year ended May 31, 2024 and 2023 were insignificant and no
amounts have been recorded.

 Fair Value of Financial Instruments

 The Company defines fair value as the exchange price
that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the
asset or liability in an orderly transaction between market participants on the measurement date. Management uses a fair value hierarchy
that distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources (observable
inputs) and (2) an entity's own assumptions about market participant assumptions developed based on the best information available
in the circumstances (unobservable inputs). The fair value hierarchy consists of three broad levels, which gives the highest priority
to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs
(Level 3). The three levels of the fair value hierarchy are described below:

 Level 1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.

 Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, including quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates); and inputs that are derived principally from or corroborated by observable market data by correlation or other means.

 Level 3 - Inputs that are both significant to the fair value measurement and unobservable.

 The fair value estimates discussed herein are based
upon certain market assumptions and pertinent information available to management as of May 31, 2024 and 2023. The carrying amounts of
current assets and current liabilities approximate their fair value because of the relatively short period of time between the origination
of these instruments and their expected realization.

 Research and Development Costs

 The Company expenses research and development costs
as incurred in accordance with FASB ASC 730 "Research and Development." During the years ended May 31, 2024 and 2023, we incurred
$ 5,632 and $ 6,528, respectively, in research and development expenses.

 Software Development Costs

 The Company accounts for software development costs
in accordance with several accounting pronouncements, including FASB ASC 730, "Research and Development," FASB ASC 350-40,
"Internal-Use Software," FASB 985-20, "Costs of Computer Software to be Sold, Leased, or Marketed" and FASB ASC
350-50, "Website Development Costs."

 Costs incurred during the period of planning and design,
prior to the period determining technological feasibility, for all software developed for use internal and external, has been charged
to operations in the period incurred as research and development costs. Additionally, costs incurred after determination of readiness
for market have been expensed as research and development.

 The Company will capitalize certain costs in the development
of our proprietary software (computer software to be sold, leased or licensed) for the period after technological feasibility was determined
and prior to our marketing and initial sales.

 F- 8

 Website development costs are capitalized under the
same criteria as our marketed software.

 Impairment of Long-lived Assets

 Long-lived assets such as property, equipment and
identifiable intangibles are reviewed for impairment whenever facts and circumstances indicate that the carrying value may not be recoverable. When
required, impairment losses on assets to be held and used are recognized based on the fair value of the asset. The fair value
is determined based on estimates of future cash flows, market value of similar assets, if available, or independent appraisals, if required. If
the carrying amount of the long-lived asset is not recoverable from its undiscounted cash flows, an impairment loss is recognized for
the difference between the carrying amount and fair value of the asset. When fair values are not available, the Company estimates
fair value using the expected future cash flows discounted at a rate commensurate with the risk associated with the recovery of the assets. We
did not recognize any impairment losses for any periods presented.

 Commitments and Contingencies

 The Company follows subtopic 450-20 of the FASB Accounting
Standards Codification to report accounting for contingencies. Liabilities for loss contingencies arising from claims, assessments,
litigation, fines and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount of
the assessment can be reasonably estimated.

 Revenue Recognition

 In accordance with ASC 606, "Revenue from Contracts
with Customers," revenue is recognized when a customer obtains control of promised goods or services. The amount of revenue recognized
reflects the consideration to which we expect to be entitled to receive in exchange for these goods or services. ASC 606 requires us to
apply the following steps: (1) identify the contract with the customer; (2) identify the performance obligations in the contract; (3)
determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize
revenue when, or as, we satisfy the performance obligation.

 Gross Versus Net Revenue

 ASC 606 provides guidance on proper recognition of
principal versus agent considerations which is used to determine gross versus net revenue recognition. Under ASC 606, the core objective
of the guidance on gross versus net revenue recognition is to help determine whether an entity is a principal or an agent in a transaction.
In general, the primary difference between these two is the performance obligation being satisfied. The principal has a performance obligation
to provide the desired goods or services to the end customer, whereas the agent arranges for the principal to provide the desired goods
or services. Additionally, a fundamental characteristic of a principal in a transaction is control. A principal substantively controls
the goods and services before they are transferred to the customer as well as controlling the price of the good or service being provided.
An agent normally receives a commission or fee for these activities. In addition to control, the level at which an entity controls the
price of the good or service being transferred determines principal versus agent status. The more discretion over setting price a company
has in providing the good or service, the more likely they are considered a principal rather than an agent. Under the guidance when another
party is involved in providing a good or service to a customer, an entity is a principal if the entity obtains control of the asset or
right to a service performed by the other party.

 The Company provides administrative services for Health
Spending Accounts sponsored by employers (the "customer"). The Company does not take possession of goods or control the services
provided as the employees of the customer are free to determine their health care provider. As such, the Company records revenue net of
reimbursements to employees. The Company's services to the customer consist of reviewing medical costs for eligibility and reimbursing
employees for eligible costs.

 During the years ended May 31, 2024 and 2023, the
Company had revenue of $ 0 and $ 0, respectively. The Company earns a 10% commission on amounts reimbursed for eligible expenses.

 Income Taxes

 The Company follows Section 740-10-30 of the FASB
Accounting Standards Codification, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences
of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities
are based on the differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect
for the fiscal year in which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to
the extent management concludes it is more likely than not that the assets will not be realized. Deferred tax assets and liabilities
are measured using enacted tax rates expected to apply to taxable income in the fiscal years in which those temporary differences are
expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the Statements
of Income and Comprehensive Income in the period that includes the enactment date.

 The Company follows section 740-10-25 of the
FASB Accounting Standards Codification ("Section 740-10-25") with regards to uncertain income tax positions.
 Section 740-10-25 addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should
be recorded in the financial statements. Under Section 740-10-25, the Company may recognize the tax benefit from an uncertain tax
position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based
on the technical merits of the position. The tax benefits recognized in the financial statements from such a position should
be measured based on the largest benefit that has a greater than fifty percent (50%) likelihood of being realized upon ultimate
settlement. Section 740-10-25 also provides guidance on de-recognition, classification, interest and penalties on income taxes,
accounting in interim periods and requires increased disclosures.

 F- 9

 Per Share Data

 Net loss per common share is computed by dividing
net loss by the weighted average common shares outstanding during the period as defined by Financial Accounting Standards, ASC Topic 260,
"Earnings per Share". Basic earnings per common share ("EPS") calculations are determined by dividing net income
by the weighted average number of shares of common stock outstanding during the year. Diluted earnings per common share calculations are
determined by dividing net income by the weighted average number of common shares and dilutive common share equivalents outstanding. During
periods when common stock equivalents, if any, are anti-dilutive they are not considered in the computation. On May 31, 2024 and 2023,
we excluded the common stock issuable upon conversion of Convertible Note Payable – Related Party of 10,587,600 shares and 10,587,600
shares, respectively, as their effect would have been anti-dilutive.

 Note 3 – Recent Accounting Pronouncements

 The Company reviews new accounting standards as issued
or updated. No new standards or updates had any material effect on these consolidated financial statements. The accounting pronouncements
issued subsequent to the date of these consolidated financial statements that were considered significant by management were evaluated
for the potential effect on these consolidated financial statements. Management does not believe any of the subsequent pronouncements
will have a material effect on these consolidated financial statements as presented.

 Note 4 – Related Party Transactions

 As of May 31, 2024 and 2023, accounts payable and
accrued liabilities – related party due to Tom Zapatinas (Chief Executive Officer and a Director of the Company) totaled $ 300,000
and $ 240,000, respectively. During the years ended May 31, 2024 and 2023, Tom Zapatinas, earned $ 60,000 and $ 120,000, respectively, for
consulting services provided to the Company.

 Advances – Related Party

 As of May 31, 2024 and 2023, advances payable due
to Tom Zapatinas totaled $ 77,187 and $ 64,952, respectively. Advances are non-interest bearing, unsecured and payable on demand. During
the years ended May 31, 2024 and 2023, Tom Zapatinas, the Chief Executive Officer and a Director of the Company, advanced the Company
$ 13,893 and $ 33,157, respectively, in cash and was repaid $ 1,658 and $ 785, respectively, in cash.

 Loans Payable – Shareholders

 As of May 31, 2024 and 2023, loans payable - shareholders
are $ 191,330 and $ 173,067, respectively. Loans payable – shareholders are unsecured, non-interest bearing and due on demand. During
the years ended May 31, 2024 and 2023, the Company advanced $ 18,263 and $ 4,992, respectively, in cash, and was repaid $ 0 and $ 0, respectively,
in cash.

 Promissory Note – Related Party

 As of May 31, 2024 and 2023, 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 on demand.

 Convertible Note Payable – Related Party

 As of May 31, 2024 and 2023, convertible note 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, 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.

 F- 10

 Note 5 – Income Taxes

 As of May 31, 2024, the Company is in arrears
on filing its statutory income tax returns. Tax years 2008 through 2024 are open for examination by taxing authorities. The Company has
incurred substantial net operating losses of approximately $ 4,227,000 since January 28, 2008 (Date of Inception).

 Schedule of deferred tax assets and liabilities

 2024

 2023

 Net operating losses – U.S. parent:

 Amount carried forward from prior years

 $
 ( 879,752
)

 $
 ( 872,137
)

 Net operating losses (21% tax rate)

 ( 20,884
)

 ( 32,815
)

 Accrued management compensation

 12,600

 25,200

 Total

 ( 888,036
)

 ( 879,752
)

 The Company's deferred tax assets and liabilities consist primarily of the following:

 Deferred taxes – U.S. Parent

 ( 888,036
)

 ( 879,752
)

 Net operating losses – Canadian subsidiary:

 Amount carried forward from prior years

 ( 31,760
)

 ( 31,760
)

 Net operating losses

 —

 —

 Deferred taxes – Canadian subsidiary

 ( 31,760
)

 ( 31,760
)

 Total deferred tax assets

 ( 919,796
)

 ( 911,512
)

 Less: valuation allowance

 919,796

 911,512

 Total net deferred tax assets

 $
 —

 $
 —

 During the years ended May 31, 2024 and 2023, the
change in valuation allowance was an increase of $ 8,284 in 2024 and an increase of $ 7,615 in 2023.

 The Company has no tax positions on May 31,
2024 and 2023 for which the ultimate deductibility is highly certain but for which there is uncertainty about the timing of such deductibility.
The Company recognizes 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 on May
31, 2024 and 2023.

 Note 6 – Stockholders' Deficit

 Common Stock, par value of $ 0.001 per share;
 75,000,000 shares authorized: 19,767,698 shares issued and outstanding on May 31, 2024 and 2023. Holders of Common Stock have one vote
per share of Common Stock held.

 Note 7 – 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.

 Note 8 – Subsequent Events

 The Company has evaluated all subsequent events through
the date these financial statements were issued and no subsequent events occurred that required disclosure.

 F- 11

 ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
ON ACCOUNTING AND FINANCIAL DISCLOSURE

 None.

 ITEM 9A. CONTROLS AND PROCEDURES

 Evaluation of Disclosure Controls and
Procedures

 Management, evaluated the effectiveness of
our disclosure controls and procedures, as defined under Exchange Act Rule 13a-15(e). Based upon this evaluation, the Chief Executive
Officer concluded that, as of May 31, 2024, the disclosure controls and procedures were not effective. The ineffectiveness of our Company's
disclosure controls and procedures was due to the existence of material weaknesses identified below.

 Disclosure controls and procedures are the
controls and other procedures that are designed to ensure that information required to be disclosed in our Company's Exchange Act
reports is recorded, processed, summarized and reported within the time periods specified in the Securities Exchange Commission's
rules and forms.

 Management's Report on Internal
Control Over Financial Reporting

 Our management is responsible for establishing
and maintaining adequate internal control over financial reporting, as defined under Exchange Act Rules 13a-15(f) and 14d-14(f). Our internal
control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

 All internal control systems, no matter how
well designed, have inherent limitations and may not prevent or detect misstatements. Therefore, even those systems determined to be effective
can only provide reasonable assurance with respect to financial reporting reliability and financial statement preparation and presentation.
In addition, projections of any evaluation of effectiveness to future periods are subject to risk that controls become inadequate because
of changes in conditions and that the degree of compliance with the policies or procedures may deteriorate.

 Management assessed the effectiveness of our
company's internal control over financial reporting as of May 31, 2024. In making the assessment, management used the criteria issued
by the Committee of Sponsoring Organizations of the Treadway Commission (COSO - 2013) in Internal Control-Integrated Framework.
Based on its assessment, management concluded that, as of May 31, 2024, our Company's internal control over financial reporting
was not effective.

 Management has identified the following material
weaknesses:

 We do not have accounting staff
with sufficient technical accounting knowledge relating to accounting for U.S. income taxes and complex US GAAP matters; and

 We failed to file our corporate
tax returns for 2008 through 2024.

 We intend to take appropriate and reasonable
steps to make the necessary improvements to remediate these material weaknesses. In particular, we intend to hire staff with U.S. GAAP
expertise if we can obtain additional financing and hire professionals to prepare and complete the filing of our corporate tax returns.

 Changes in Internal Control over Financial
Reporting

 There have been no changes in our internal
controls over financial reporting that occurred during our fourth fiscal quarter that have materially affected, or are reasonably likely
to materially affect, our internal controls over financial reporting.

 ITEM 9B. OTHER INFORMATION.

 During the
quarter ended May 31, 2024, no director or Section 16 officer adopted or terminated any Rule 10b5-1 trading arrangements
or non-Rule 10b5-1 trading arrangements.

 ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

 Directors and Executive Officers

 The following individual serves as the director
and executive officers of our Company. All directors of our Company hold office until the next annual meeting of our shareholders or until
their successors have been elected and qualified. The executive officers of our Company are appointed by our board of directors and hold
office until their death, resignation or removal from office.

 Name

 Position

 Age

 Date First Elected or Appointed

 Tom Zapatinas

 President, Chief Executive Officer, Secretary, Chief Financial Officer, Treasurer and Director

 Director since January 9, 2007

Officer since January 25, 2008

 Paul Verberne

 Director

 Director since June 1, 2018

 Significant Employees

 There are no family relationships between or among our directors
or executive officers.

 Business Experience

 Tom Zapatinas, President, Secretary, Chief Executive Officer,
Chief Financial Officer and a director

 Tom Zapatinas has been a director of our Company
since January 9, 2007 and the president, secretary, chief executive officer and chief financial officer of our company since January 25,
2008. Mr. Zapatinas has been a self-employed business consultant since August 1997. In June of 1998, Mr. Zapatinas founded Prolific Smart
Card Software Systems Inc. which became a reporting issuer on the TSX Venture Exchange in Canada. Mr. Zapatinas resigned from Prolific
on May 29, 2001, to go back to his consulting practice. He brings experience in financing, corporate development and mergers and acquisitions.

 Mr. Zapatinas is not an officer or director
of any other reporting company that files annual, quarterly or periodic reports with the United States Securities and Exchange Commission.

 We believe Mr. Zapatinas is qualified to serve
on our board of directors because of his knowledge of our company's history and current operations, which he gained from working
for our company as described above, in addition to his business experiences as described above.

 Paul Verberne, member
of the Board of Directors

 Mr. Verberne has been involved
in the Healthcare Spending Account (HSA) industry since 2004, when he became counsel for HSA Bank (a division of Webster Bank). He provided
legal and business expertise focused on tax favoured benefit accounts, helping HSA Bank grow from $8 million in HSA deposits to over $800
million in six years. HSA Bank is now a leading HSA provider in the USA with over $5 billion in assets. Mr. Verberne was also general
counsel to the American Banker's Association HSA Council and Tango Health, a leading benefits optimization solutions provider. He is currently
a principal in HSA Consulting Services, LLC, which provides training and expertise to the HSA industry, and a partner in Verberne &
Maldonado LLP in Houston, a law firm concentrating in business law. He received his B.A. in Liberal Arts Hi(Economics/Psychology) from
the University of Texas (Austin) and a Juris Doctorate from University of Houston Law Center. Mr. Verberne will be providing strategic
advice and guidance to PreAxia as it develops, rolls out and expands its HSA Management Solution throughout Canada and the USA.

 Involvement in Certain Legal Proceedings

 Our directors or executive officers have not
been involved in any of the following events during the past ten years:

 1.

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

 2.

 any conviction in a criminal proceeding or being subject to a pending criminal proceeding (excluding traffic violations and other minor offences);

 3.

 being subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities; or

 4.

 being found by a court of competent jurisdiction (in a civil action), the Commission or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended, or vacated.

 5.

 being the subject of, or a party to, any federal or state judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to an alleged violation of: (i) any federal or state securities or commodities law or regulation; or (ii) any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease- and-desist order, or removal or prohibition order; or (iii) any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or

 6.

 being the subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined in Section 3(a) (26) of the Securities Exchange Act of 1934), any registered entity (as defined in Section 1(a) (29) of the Commodity Exchange Act), or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member.

 Audit Committee

 The Corporation is a "venture issuer"
as defined in National Instrument 52-110 and is relying on the exemption contained in Section 6.1 of National Instrument 52-110, which
exempts the Corporation from the requirements of Part 3 (Composition of the Audit Committee) and Part 5 (Reporting Obligations) of National
Instrument 52-110.

 The Audit Committee's Charter

 Mandate

 The primary function of the audit committee (the
"Committee") is to assist the Board of Directors in fulfilling its financial oversight responsibilities by reviewing the
financial reports and other financial information provided by the Corporation to regulatory authorities and shareholders, the
Corporation's systems of internal controls regarding finance and accounting and the Corporation's auditing, accounting
and financial reporting processes. Consistent with this function, the Committee will encourage continuous improvement of, and should
foster adherence to, the Corporation's policies, procedures and practices at all levels. The Committee's primary duties
and responsibilities are to:

 Serve as an independent and objective party to monitor the Corporation's financial reporting and internal control system and review the Corporation's financial statements.

 Review and appraise the performance of the Corporation's external auditors.

 Provide an open avenue of communication among the Corporation's auditors, financial and senior management and the Board of Directors.

 Composition

 The Committee shall be comprised of two directors
as determined by the Board of Directors, whom shall be free from any relationship that, in the opinion of the Board of Directors, would
interfere with the exercise of his or her independent judgment as a member of the Committee.

 The members of the Committee shall be elected by the
Board of Directors at its first meeting following the annual shareholders' meeting. Unless a Chair is elected by the full Board
of Directors, the members of the Committee may designate a Chair by a majority vote of the full Committee membership.

 Meetings

 The Committee shall meet annually, or more frequently
as circumstances dictate. As part of its job to foster open communication, the Committee will meet at least annually with the Chief Financial
Officer and the external auditors.

 Responsibilities and Duties

 To fulfill its responsibilities and duties, the Committee shall:

 Documents/Reports Review

 (a)

 Review and update this Charter annually.

 (b)

 Review the Corporation's financial statements, MD&A and any reports or other financial information (including quarterly financial statements), which are submitted to any governmental body, or to the public, including any certification, report, opinion, or review rendered by the external auditors.

 External Auditors

 (a)

 Review annually, the performance of the external auditors who shall be ultimately accountable to the Board of Directors and the Committee as representatives of the shareholders of the Corporation.

 (b)

 Obtain annually, a formal written statement of the external auditors setting forth all relationships between the external auditors and the Corporation, consistent with PCAOB Rule 3526.

 (c)

 Review and discuss with the external auditors any disclosed relationships or services that may impact the objectivity and independence of the external auditors.

 (d)

 Take, or recommend that the full Board of Directors take, appropriate action to oversee the independence of the external auditors.

 (e)

 Recommend to the Board of Directors the selection and, where applicable, the replacement of the external auditors nominated annually for shareholder approval.

 (f)

 At each meeting, consult with the external auditors, without the presence of management, about the quality of the Corporation's accounting principles, internal controls and the completeness and accuracy of the Corporation's financial statements.

 (g)

 Review with management and the external auditors the audit plan for the year-end financial statements and intended template for such statements.

 (h)

 Review and pre-approve all audit and audit related services and the fees and other compensation related thereto, and any non-audit services, provided by the Corporation's external auditors. The pre-approval requirement is waived with respect to the provision of non-audit services if:

 (i)

 the aggregate amount of all such non-audit services provided to the Corporation constitutes not more than five percent of the total amount of revenues paid by the Corporation to its external auditors during the fiscal year in which the non-audit services are provided;

 (ii)

 such services were not recognized by the Corporation at the time of the engagement to be non-audit services; and

 (iii)

 such services are promptly brought to the attention of the Committee by the Corporation and approved prior to the completion of the audit by the Committee or by one or more members of the Committee who are members of the Board of Directors to whom authority to grant such approvals have been delegated by the Committee.

 Provided the pre-approval of the non-audit services
is presented to the Committee's first scheduled meeting following such approval such authority may be delegated by the Committee to one
or more independent members of the Committee.

 Financial Reporting Processes

 (a)

 In consultation with the external auditors, review with management the integrity of the Corporation's financial reporting process, both internal and external.

 (b)

 Consider the external auditors' judgments about the quality and appropriateness of the Corporation's accounting principles as applied in its financial reporting.

 (c)

 Consider and approve, if appropriate, changes to the Corporation's auditing and accounting principles and practices as suggested by the external auditors and management.

 (d)

 Review significant judgments made by management in the preparation of financial statements and the view of the external auditors as to the appropriateness of such judgments.

 (e)

 Following completion of the annual audit, review separately with management and the external auditors any significant difficulties encountered during the course of the audit, including any restrictions on the scope of work or access to required information.

 (f)

 Review any significant disagreement among management and the external auditors in connection with the preparation of the financial statements.

 (g)

 Review with the external auditors and management the extent to which changes and improvements in financial or accounting practices have been implemented.

 (h)

 Review any complaints or concerns about questionable accounting, internal accounting controls or auditing matters.

 (i)

 Review certification process.

 Other

 Review any related-party transactions.

 Members of the Audit Committee

 Member

 Independence

 Financially Literate

 Tom Zapatinas

 Paul Verberne

 Not Independent

 Not Independent

 Not Financially literate

 Not Financially literate

 CORPORATE GOVERNANCE

 Corporate Governance relates to the activities of
the Board of Directors. National Policy 58-201 establishes corporate governance guidelines which apply to all public companies. The Corporation
has reviewed its own corporate governance practices in light of these guidelines. In certain cases, the Corporation's practices
comply with the guidelines, however, the Board considers that some of the guidelines are not suitable for the Corporation at its current
stage of development and therefore these guidelines have not been adopted. National Policy 58-201 mandates disclosure of corporate governance
practices which disclosure is set out below. The Board is committed to sound corporate governance practices in the interest of its shareholders
and contribute to effective and efficient decision making. The Corporation will continue to review and implement corporate governance
guidelines as the business of the Corporation progresses.

 Independence of Members of Board

 The Corporation's Board consists of two directors,
Paul Verberne and Tom Zapatinas. Of which Tom Zapatinas is not independent as he is the Chief Executive Officer of the Corporation.

 Management Supervision by Board

 The size of the Corporation is such that all of the
Corporation's operations are conducted by a small management team which is also represented on the Board. The Board considers that
management is effectively supervised by the director on an informal basis as the director is actively and regularly involved in reviewing
the operations of the Corporation and has regular and full access to management.

 Other Directorships

 Paul Verberne or Tom Zapatinas is not a director of
any other reporting issuers.

 Orientation and Continuing Education

 The Board does not have a formal orientation
or education program for its members. New Board members are provided with information respecting the functioning of the Board of Directors,
audit committee, access to all of the publicly filed documents of the Corporation and complete access to management and the Corporation's
professional advisors.

 Board members are encouraged to communicate
with management and the auditors, to keep themselves current with industry trends and developments and changes in legislation with the
Corporation's assistance, to attend industry seminars and to visit the Corporation's operations. Board members have full access
to the Corporation's records and legal counsel.

 Ethical Business Conduct

 The Board believes good corporate governance
in an integral component to the success of the Corporation and to meet responsibilities to shareholders.

 At present the Board has not adopted guidelines
or stipulations or a code to encourage and promote a culture of ethical business conduct due to the size of its Board and its limited
activities. The Corporation does promote ethical business conduct through the nomination of Board members it considers ethical.

 Nomination of Directors

 The Board has responsibility for identifying
and assessing potential Board candidates. Recruitment of new directors has generally resulted from recommendations made by directors,
management and shareholders. The Board assesses potential Board candidates to fill perceived needs on the Board for required skills, expertise,
independence and other factors.

 Compensation of Directors and the CEO

 The directors decide as a Board the compensation
for the Corporation's directors and officers. Compensation payable is determined by considering compensation paid for directors
and CEOs of companies of similar size and stage of development in the health care payment industry and determining appropriate compensation
reflecting the need to provide incentive and compensation for the time and effort expended by the directors and senior management while
taking into account the financial and other resources of the Corporation. In setting the compensation, the performance of the CEO is reviewed
in light of the Corporation's objectives and other factors that may have impacted the success of the Corporation.

 Board Committees

 The Corporation has an Audit Committee (see
section entitled "Audit Committee").

 The Board is of the view that the size of the
Corporation's operations does not warrant additional committees at this stage of the Corporation's development.

 Assessments

 The Board does not consider that formal assessments
would be useful at this stage of the Corporation's development.

 Section 16(a) Beneficial Ownership Reporting Compliance

 Section 16(a) of the Securities Exchange Act
requires our executive officers and directors, and persons who own more than 10% of our common stock, to file reports regarding ownership
of, and transactions in, our securities with the Securities and Exchange Commission and to provide us with copies of those filings. Based
solely on our review of the copies of such forms received by us, or written representations from certain reporting persons, we believe
that during the fiscal year ended May 31, 2024 all filing requirements applicable to our executive officers, directors and greater than
10% percent beneficial owners were complied with.

 ITEM 11. EXECUTIVE COMPENSATION

 The following table sets forth all compensation received
during the two years ended May 31, 2024 and 2023 by our principal executive officer and principal financial officer and each of the other
most highly compensated executive officers whose total compensation exceeded $100,000 in such fiscal year. These officers are referred
to as the Named Executive Officers in this report.

 Summary Compensation

 The following table provides a summary of the compensation received by
the persons set out therein for each of our last two fiscal years:

 SUMMARY COMPENSATION TABLE

 Name and

Principal

Position

Year

Salary

($)

 Bonus

($)

 Stock

Awards

($)

 Option

Awards

($)

 Non-Equity

Incentive Plan

Compensation

($)

 Change in

Pension

Value and

Nonqualified

Deferred

Compensa-

tion Earnings

($)

 All Other

Compensa

-tion

($)

Total

($)

 Tom Zapatinas,

President, CEO and

Director

 2024

2023

 $60,000

$120,000

 Nil

Nil

 Nil

Nil

 Nil

Nil

 Nil

Nil

 Nil

Nil

 Nil

Nil

 $60,000

$120,000

 Employment Agreements

 There are currently no employment agreements in effect.

 Pension, Retirement or Similar Benefit Plans

 There are no arrangements or plans in which we provide
pension, retirement or similar benefits for directors or executive officers. We adopted and approved our current stock option plan on
January 28, 2010, pursuant to which we may grant stock options to acquire up to 2,000,000 shares of our common stock. Our directors and
executive officers may receive stock options at the discretion of our board of directors in the future. We do not have any material bonus
or profit-sharing plans pursuant to which cash or non-cash compensation is or may be paid to our directors or executive officers, except
that stock options may be granted at the discretion of our board of directors from time to time.

 Termination of Employment and Change in Control
Arrangements

 We have no plans or arrangements in respect of remuneration
received or that may be received by our executive officers to compensate such officers in the event of termination of employment (as a
result of resignation, retirement, change of control) or a change of responsibilities following a change of control.

 Outstanding Equity Awards at Fiscal Year-End

 The following table sets forth for each named executive
officer certain information concerning the outstanding equity awards as of May 31, 2024.

 OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END

 OPTION AWARDS

 STOCK AWARDS

Name

Number of

Securities

Underlying

Unexercised

Options

(#)

Exercisable

Number of

Securities

Underlying

Unexercised

Options

(#)

Unexercisable

Equity

Incentive

Plan

Awards:

Number of

Securities

Underlying

Unexercised

Unearned

Options

(#)

Option

Exercise

Price

($)

Option

Expiration

Date

Number

of

Shares

or Units

of Stock

That

Have

Not

Vested

(#)

Market

Value

of

Shares

or

Units of

Stock

That

Have

Not

Vested

($)

Equity

Incentive

Plan

Awards:

Number

of

Unearned

Shares,

Units

or Other

Rights

That

Have Not

Vested

(#)

 Equity

Incentive

Plan

Awards:

Market or

Payout

Value

of

Unearned

Shares,

Units

or Other

Rights

That

Have Not

Vested

(#)

 Tom Zapatinas

 None

 None

 None

 None

 None

 None

 None

 None

 None

 Aggregated Option Exercises

 There were no options granted or exercised by any
executive officer or director of our company during the twelve-month period ended May 31, 2024.

 Directors Compensation

 We reimburse our directors for expenses incurred in
connection with attending board meetings but did not pay director's fees or other cash compensation for services rendered as a director
in the year ended May 31, 2024. We have no present formal plan for compensating our directors for their service in their capacity as directors,
although in the future, such directors are expected to receive compensation and options to purchase shares of common stock as awarded
by our board of directors or (as to future options) a compensation committee which may be established in the future. Directors are entitled
to reimbursement for reasonable travel and other out-of-pocket expenses incurred in connection with attendance at meetings of our board
of directors. The board of directors may award special remuneration to any director undertaking any special services on behalf of our
company other than services ordinarily required of a director. Other than indicated in this annual report, no director received and/or
accrued any compensation for his or her services as a director, including committee participation and/or special assignments.

 ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

 Security ownership of certain beneficial owners

 The following table sets forth, as of September
26, 2024, certain information with respect to the beneficial ownership of our common stock by our current directors and executive officers
as a group. Each person has sole voting and investment power with respect to the shares of common stock they hold, except as otherwise
indicated. Beneficial ownership consists of a direct interest in the shares of common stock, except as otherwise indicated. As of September
26, 2024, there were no shareholders known by us to be the beneficial owner of more than 5% of our common stock except as set forth in
the following table.

 Security ownership of management

Title of Class

Name and Address of Beneficial Owner

 Amount and Nature of

Beneficial Ownership (1)

 Percentage

of Class (2)

 Tom Zapatinas

 9,100,000

 Direct

 46.03%

 3212 – 14 Avenue SW

 Calgary, AB T3C 0X3

 Paul Verberne

 3212 – 14 Avenue SW

 Calgary, AB T3C 0X3

 -

 -

 All officers and directors as a group (2 persons)

 9,100,000

 46.03%

 1 Except
as otherwise indicated, we believe that the beneficial owners of the common stock listed above, based on information furnished by such
owners, have sole investment and voting power with respect to such shares, subject to community property laws where applicable. Beneficial
ownership is determined in accordance with the rules of the Securities and Exchange Commission and generally includes voting or investment
power with respect to securities. Shares of common stock subject to options or warrants currently exercisable, or exercisable within 60
days, are deemed outstanding for purposes of computing the percentage ownership of the person holding such option or warrants, but are
not deemed outstanding for purposes of computing the percentage ownership of any other person.

 2 Based upon 19,767,698 issued and outstanding shares of common stock
as of October 10, 2024.

 Changes in Control

 We are unaware of any contract or other arrangement
the operation of which may at a subsequent date result in a change of control of our company.

 ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS,
AND DIRECTOR INDEPENDENCE

 Other than as listed below, no director, officer,
principal shareholder holding at least 5% of our common shares, or any family member thereof, had any material interest, direct or indirect,
in any transaction, or proposed transaction, since the beginning of our fiscal year ended May 31, 2024, in which the amount involved
in the transaction exceeded or exceeds the lesser of $120,000 or one percent of the average of our total assets at year-end for the last
two completed fiscal years.

 1.

 During the year ended May 31, 2024, the Company's president, Tom Zapatinas, invoiced $60,000 for management services rendered to the Company, advanced $13,893 in cash and received repayments of $1,658 in cash. As of May 31, 2024, Accounts payable – related party and Advances – related party includes a total of $377,187 due and payable to Mr. Zapatinas. The balance as of May 31, 2023 was $304,952.

 2.

 As of May 31, 2024 and 2023, loans payable - shareholders
 are $191,330 and $173,067, respectively. Loans payable – shareholders are unsecured, non-interest bearing and due on demand or due
 within one year after the issuance date. During the years ended May 31, 2024 and 2023, the Company was advanced $18,263 and $4,992, respectively,
 in cash, and was repaid $0 and $0, respectively, in cash.

 3.

 As of May 31, 2024 and 2023, convertible note 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, 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.

 Director Independence

 We do not currently have any directors that would
fit the independence requirements of Rule 5605(a)(2) of the Nasdaq Marketplace Rules.

 ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES

 Audit fees

 The aggregate fees billed by
GreenGrowthCPAs for the completed fiscal periods ended May 31, 2024 and 2023 for professional services rendered for the audit of our
annual financial statements, quarterly reviews of our interim financial statements and services normally provided by the independent
accountant in connection with statutory and regulatory filings or engagements for these fiscal periods were as follows:

 Year Ended
 May 31,
 2024

 Year Ended
 May 31,
 2023

 Audit Fees and Audit Related Fees

 $
 10,000

 $
 10,000

 Tax Fees

 —

 —

 All Other Fees

 —

 —

 Total

 $
 10,000

 $
 10,000

 In the above tables, "audit fees" are
fees billed by our company's external auditor for services provided in auditing our company's annual financial statements
for the subject year. "Audit-related fees" are fees not included in audit fees that are billed by the auditor for assurance
and related services that are reasonably related to the performance of the audit and review of our company's financial statements.
"Tax fees" are fees billed by the auditor for professional services rendered for tax compliance, tax advice and tax planning.
"All other fees" are fees billed by the auditor for products and services not included in the foregoing categories.

 Policy on Pre-Approval by Audit Committee of Services Performed by
Independent Auditors

 The board of directors pre-approves all services provided by our independent
auditors. All of the above services and fees were reviewed and approved by the board of directors before the respective services were
rendered.

 ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES

 Exhibit Number

 Description

 3.1

 Articles of Incorporation (Incorporated by reference to the Exhibits filed with the Form SB-2 filed with the SEC on March 16, 2006)

 3.2

 Certificate of Amendment to Articles of Incorporation (Incorporated by reference to the Exhibits filed with Schedule 14C on November 14, 2008)

 3.3

 Bylaws (Incorporated by reference to the Exhibits filed with the Form SB-2 filed with the SEC on March 16, 2006)

 3.4

 Amended Bylaws (Incorporated by reference to the Exhibits filed with the Form SB-2 filed with the SEC on March 16, 2006)

 10.1

 Share Exchange Agreement dated May 31, 2005 between Kimberley Coonfer, Caribbean Overseas Investments Ltd., Sun World Partners Inc. and Tiempo De Mexico Ltd. (Incorporated by reference to the Exhibits filed with the Form SB-2 filed with the SEC on March 16, 2006)

 10.2

 Letter of Intent dated February 22, 2008 between Sun World Partners Inc. and H Pay Card Ltd. (Incorporated by reference to the Exhibits filed with the Form 8-K on March 5, 2008)

 10.3

 Acquisition Agreement dated April 22, 2008 (Incorporated by reference to the Exhibits filed with the Form 8-K on May 19, 2008)

 10.4

 Promissory note dated June 1, 2011 issued to Macleod Projects Inc. (Incorporated by reference to the Exhibits filed with the annual report on Form 10-K for the year ended May 31, 2011 filed with the SEC on October 21, 2011)

 10.5

 Promissory note dated August 5, 2011 issued to Macleod Projects Inc. (Incorporated by reference to the Exhibits filed with the annual report on Form 10-K for the year ended May 31, 2011 filed with the SEC on October 21, 2011)

 10.6

 Promissory
 note dated August 31, 2017 issued to 2001033 Alberta Ltd. (Incorporated by reference to the Exhibits filed with the annual report
on Form 10-K for the year ended May 31, 2018 filed with the SEC on September 13, 2018)

 10.7

 Promissory note dated May
 31, 2018 issued to 1378655 Alberta Ltd. (Incorporated by reference to the Exhibits filed with the annual report
on Form 10-K for the year ended May 31, 2018 filed with the SEC on September 13, 2018)

 31.1 *

 Section 302 Certification of Principal Executive Officer

 32.1 *

 Certification Pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

 101.INS*

 101.SCH*

 101.CAL*

 101.DEF*

 101.LAB*

 101.PRE*

 *Filed Herewith.

 ITEM 16. FORM 10-K SUMMARY. None

 SIGNATURES

 Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 PREAXIA HEALTH CARE PAYMENT SYSTEMS INC.

 /s/ Tom Zapatinas
By: Tom Zapatinas, President and Director

(Principal Executive Officer, Principal Financial Officer and Director)

Dated: October 10, 2024

 Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

 /s/ Tom Zapatinas
By: Tom Zapatinas, President and Director

(Principal Executive Officer, Principal Financial Officer and Director)

Dated: October 10, 2024

 /s/ Paul Verberne
By: Paul Verberne, Director

Dated: October 10, 2024