FORM 10-K

 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, 2025

 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 368, Dunedin FL 34697-0368

 (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,
2024.

 (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:

 53,824,000 shares of common stock as of
August 31, 2025

 DOCUMENTS INCORPORATED BY REFERENCE

 Not Applicable.

 Notice: This filing has not been audited or reviewed by a PCAOB Registered Accounting firm. As soon as an audit for the financial
statements has been completed, we will file an amendment to include the audit report.

 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

 PART
I

 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.

 On May 23, 2025,
the Company created a wholly owned subsidiary in Alberta Canada, named Zane Inc. CA. This subsidiary will develop and market the personal
financial management products and perfect the health care payment processing services. Zane Inc had no operations before June 30, 2025.

 General Overview

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 2024 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 lnterac 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 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.

 Description of personal financial products

 Our new subsidiaries, Zane Inc CA and Zane US Inc., will
concentrate on developing and marketing personal financial tools. Zane's product philosophy centers on a fundamental belief: everyone
deserves access to genius level financial guidance. Zane is building the financial operating system for Generation Z - an AI-powered super-app
that not only tracks money but also actively and automatically manages it. We're creating what we call a "personal AI-banker in your
pocket" - a revolutionary platform that combines the entire world's banking and financial knowledge with an intimate understanding
of each user's unique situation, goals, and needs.

 The platform centers around three breakthrough innovations:

 1.
 High-Interest Super Account (HISA): Eliminates boundaries between checking, savings, and investment
accounts, allowing every dollar to grow at a 10% APY average while remaining instantly accessible

 2.
 Smart Debit Card: Enforces daily spending limits based on predictive budgeting, making overspending
physically impossible while building credit automatically

 3.
 MoneyNet: A distributed financial network monitors all user accounts across every institution, automatically
orchestrating fund movements to prevent overdrafts, maximize returns, and minimize fees

 Distribution
Methods and Marketing Strategy

and Zane operate on a Cloud Computing Platforms 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.

 PreAxia and Zane operate as a financial
technology company structured to navigate the complex regulatory landscape while maintaining agility to innovate rapidly. We're establishing
dual headquarters to serve our primary markets effectively, with technology development centered in Calgary, Canada, and regulatory operations
managed from major financial centers in both the United States and Canada.

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.

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

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.

 •
Zelle offers mobile internet money management.

 US and International
 Markets

 PreAxia- Zane occupies a unique position
in the fintech ecosystem, best understood not as a competitor to existing players but as a new category entirely. We're not building a
better budgeting app - we're eliminating the need for budgeting by giving users a personal AI banker that handles it automatically. We're
not creating another digital bank - we're making traditional banking boundaries irrelevant through an AI advisor that orchestrates across
all institutions. This positioning allows us to partner with, rather than compete against, many existing players. Universities see us
as a tool to improve student retention by giving every student a personal financial advisor. Employers view us as an employee benefit
that provides each worker with genius-level financial guidance at virtually no cost to the company. Even traditional banks will eventually
see us as a path to remain relevant to the younger customers they're currently losing. Our long-term vision extends beyond personal finance
into the broader economic ecosystem. By aggregating transaction-level data across millions of users, we'll possess unprecedented insights
into consumer behavior, enabling us to offer predictive analytics to retailers, manufacturers, and service providers. This creates a virtuous
cycle where our B2B revenue streams subsidize free services for consumers while our consumer growth drives more valuable B2B insights.

 Intellectual Property
 and Patent Protection

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

 Research
 and Development

 For the year
ended May 31, 2025, and 2024,
we incurred $0 and $5,632 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 2025 and
2025 in areas of administration/accounting, business
development, operations, sales/marketing and research/development.

 ITEM lA. RISK FACTORS

 Not applicable to smaller reporting companies.

 ITEM lB. 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, 2025, and 2024.

 Quarter Ended

 High

 Low

 05/31/2025

 02/28/2025

 11/30/2024

 08/31/2024

 $0.0565

 05/31/2024

 02/28/2024

 11/30/2023

 08/31/2023

 $0.0565

 Holders
 of Our Common Stock

 As of August 31, 2025, there
were 92 holders of record of our common stock and 43,024,000 shares
of common stock outstanding and 10,800,000 in treasury stock pending vesting. 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. This plan was re-affirmed in July 2025 for 2,400,000
stock options. 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, 2025.

 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 I A

 2,400,000

 Equity compensation plans not approved by security

 holders

 None

 NIA

 None

 Total

 None

 N I A

 2,400,000

 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 I 0-Q or
in a current report on
Form 8-K during the
fiscal year ended May 31, 2025.

 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, 2025, or 2024.

 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

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 I 8% 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 previous
and new business plans;

 (b)
Develop a suite of personal financial management applications and websites,

 (c)
Penetrate the United
States and Canadian markets, by continuing to develop innovative financial
processing products and services;

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

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

 Liquidity and Capital Resources

 As
of May 31, 2025, PreAxia's cash balance was $0 compared to $14 as of
May 31, 2024. Our
Company will be required to
raise capital to fund our operations. PreAxia had a working capital
deficit of $2,342,041 as of May 31, 2025, compared with a working capital deficit
of $2,396,179
as of May 31, 2024.

 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 $1,500,000 over the next twelve-month
period to pay our arms-length creditors
approximately $200,000 plus an
additional $1,300,000 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.

 The decrease in our working
capital deficit of $54,152 was primarily due to decreases in accounts payable of
($59,506), officer compensation accrual of $100,000, settlement of ($134,794) in liabilities for unissued
shares, and loans payable - shareholders of $40,536.

 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, 2025, and 2024

 For the
 years ended May 31, 2025, and 2024

 Our operating results for the
years ended May 31, 2025, compared to the years ended May 31, 2024, are described below:

 Revenue

 During the years ended May 31, 2025, and 2024, 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, 2025, were $152,124 compared to $99,44
for the year ended May 31, 2024. The increase in total expenses
 of $52,675 for the
year ending May 31, 2025, is due to an increase in consulting fees of $40,000, increase in professional fees of $28,824, a decrease of
($10,517) in office and administration fees, and a decrease in
research and development of ($5,632).

 Consulting
Fees

 During each of the years ended May 31, 2025, and 2024, Tom Zapatinas, the Chief Executive Officer and Director of the Company, earned $100,000 and $60,000,
respectively, for consulting services provided to the Company, which is included in accounts payable and accrued liabilities - related party. During the period from June 1, 2024, to May 31, 2025,
the Company did not accrue compensation to Tom Zapatinas.

 Research and Development

 Research and development
expenses during the year ended
May 31, 2025, decreased by $5,632 to $0,
as compared to $5,632 during
the year ended May 31, 2024. 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, 2025, and 2024.

 Professional
 Fees

 Professional fees during the year ended May 31, 2025,
increased by $28.824 to $47,478,
as compared to $18,654 during
the year ended May 31, 2024. Professional fees increased due to
an increase in costs related to the
audit.

 Interest Expense

 Interest expense
is $0 for the years
ended May 31, 2025, and 2024, because
accounts payable and accrued liabilities - related party, convertible note
payable - related party and
loans payable - shareholders
are non-interest bearing.

 Gain on settlement

 The Company recorded a $70,114 gain on the settlement of
old accounts payable.

 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

 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-5 to F-11

 Notice: This filing has not been audited or reviewed by a PCAOB Registered Accounting firm. As soon
as an audit for the financial statements has been completed, we will file an amendment to include the audit report.

 PreAxia Health Care Payment Solutions Inc

 Consolidated Balance Sheets

 As of May 31, 2025 and 2024

 May 31, 2025

 May 31, 2024

 Assets

 Current assets

 Cash and cash equivalents

 $
 —

 $

 —

 Property and equipment, net

 —

 —

 Total assets

 $
 —

 $

 Liabilities and Shareholders' Deficit

 Current liabilities

 Accounts payable and accruals

 $
 43,681

 $
 95,301

 Accruals and other current liabilities

 468,726

 71,609

 Related party loans

 1,829,623

 2,228,885

 Bank indebtedness

 2,342,041

 2,396,193

 2,342,041

 2,396,193

 Commitments and Contingencies (Note 8)

 Shareholders' Deficit

 Common stock, 75,000,000 shares authorized, $0.001 par value,19,767,698 issued and outstanding on May 31, 2025, and 2024, respectively

 Additional paid in capital

 2,782,203

 2,655,236

 Stock subscription

 7,825

 —

 Accumulated deficit

 (5,210,390
)

 (5,128,380
)

 Accumulated other comprehensive income

 58,553

 57,197

 Total shareholders' deficit

 (2,342,041
)

 (2,396,179
)

 Total liabilities and shareholders' deficit

 $
 —

 $

 See Accompanying Notes to the Consolidated
Financial Statements

 F- 1

 PreAxia Health Care Payment Solutions Inc

 Consolidated Statements of Operations

 Years Ended May 31, 2025, and 2024

 Year Ended

May 31,

2025

 Year Ended

May 31,

2024

 Revenues

 $
 —

 $
 —

 General and administrative expenses

 Labor and management

 60,000

 Professional fees

 47,478

 18,654

 General and administration

 4,646

 15,163

 Research and development

 —

 5,632

 152,124

 99,449

 Operating loss

 (152,124
)

)

 Gain on settlement

 (70,114
)

 —

 Ordinary loss before income taxes

 (82,010
)

)

 Other comprehensive income

 1,356

 —

 Less Income tax expense

 —

 —

 Net loss

 $
 (53,687
)

 $
)

 Weighted average shares

 Earnings per share – basic and diluted

 $
 (0.00
)

 $
 (0.01
)

 See Accompanying Notes to the Consolidated Financial Statements

 F- 2

 Health Care Payment Solutions Inc

 Consolidated
 Statement of Changes in Members' and Shareholders' Deficit

 Years Ended May 31, 2025, and 2024

 Number of
 shares

 Common
 stock

 Additional Paid in Capital

 Subscriptions for Stock to be issued

 Other
 Comprehensive
 Income

 Accumulated
 deficit

 Total

 Balance, May 31, 2023

 $

 $
 2,655,236

 $
 —

 $
 57,197

 $
 (5,028,931
)

 $
 (2,296,730
)

 Net loss

 —

 —

 —

 —

)

)

 Balance, May 31, 2024

 $

 $
 2,655,236

 $
 —

 $
 57,197

 $
 (5,128,380
)

 $
 (2,396,179
)

 Settlement on debt

 —

 —

 126,967

 —

 —

 —

 126,967

 Stock to be issued

 —

 —

 —

 7,825

 —

 —

 7,825

 Net loss

 —

 —

 —

 —

 1,356

 (82,010
)

 (80,654
)

 Balance, May 31, 2025

 $

 $
 2,782,203

 $
 7,825

 $
 58,553

 $
 (5,210,390
)

 $
 (2,342,041
)

See Accompanying Notes to the Consolidated Financial Statements

 F- 3

 PreAxia Health Care Payment Solutions Inc

 Consolidated Statement of Cash Flows

 Years Ended May 31, 2025 and 2024

 Year Ended May 31, 2025

 Year Ended May 31, 2024

 Cash used in Operating activities

 Net loss

 $
 (80,654
)

 $
)

 Less comprehensive income

 (1,356
)

 —

 Ordinary loss

 (82,010
)

)

 Items not affecting cash:

 Loss on settlement of debt

 (70,114
)

 —

 Changes in non-cash working capital:

 Accounts payable

 10,608

 8,561

 Other current liabilities

 60,000

 Net cash flows from operating activities

 (41,516
)

 (30,888
)

 Investing activities

 Net cash flows from investing activities

 —

 —

 Financing activities

 Bank overdrafts

 (388
)

 Proceeds from related parties

 30,534

 32,156

 Repayments to related parties

 (97,825
)

 (1,658
)

 Stock subscriptions

 7,825

 —

 Proceeds from sale of stock

 —

 Net cash flows from financing activities

 40,146

 30,896

 Foreign currency change

 1,356

 —

 Increase (decrease) in cash during the year

 (14
)

 Cash, beginning of the period

 Cash, end of the period

 $
 —

 $

 See Accompanying Notes to the Consolidated
Financial Statements

 F- 4

 PREAXIA
HEALTH CARE PAYMENT SYSTEMS INC.

 NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS

 May 31, 2025
and 2024

 Unaudited

 Note 1 - Organization and Description
of Business

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 personal
financial management applications, websites, and products. The Company's products are in the development stage.

 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.

 On May 23, 2025,
the Company created a wholly owned subsidiary in Alberta Canada, named Zane Inc. CA. This subsidiary will develop and market the personal
financial management products and perfect the health care payment processing services. Zane Inc had no operations before June 30, 2025.

 F- 5

 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 o f Consolidation

 The consolidated
financial statements include the accounts of the Company and its wholly owned subsidiaries (i) PreAxia Health Care Payment Ltd., and (ii)
Zane Inc CA, All inter-company accounts and transactions have been eliminated in consolidation.

 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, 2025, the Company incurred a net loss of $80,654
and used cash in operating activities of $41,516, and as of May 31, 2025, had a stockholders' deficit of $2,342,041 and an
accumulated deficit of $5,210,390. 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 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 o f 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- 6

 Fore i gn
Currenc y 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=1.3860
Canadian Dollars (May 31, 2025), 1.00 USD Dollar=0.7408 GBP, and 1.00 US Dollar=l.3643 Canadian
Dollars (May 31, 2024), 1.00 USD Dollar=0. 7852 GBP;

 ii)
income and expenses are translated at average exchange rates for the year ended May
31, 2025 of 1.00 US Dollar= 1.3957
Canadian Dollars and 1.00 US Dollar= 1.3515 Canadian Dollars (May 31, 2024);

 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, 2025, and 2024 were $1,356 and $0, respectively.

 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, 2025,
and 2024. 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, 2025, and 2024, we incurred $0 and $5,632, 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- 7

 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 3l,
2025 and 2024, 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 be reversed. 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- 8

 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, 2025 and 2024, we excluded the common stock issuable upon conversion of
Convertible Note Payable - Related
Party of I0,587,600 shares
and l 0,587,600 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.

 Segment reporting
pronouncement from November 2023 are included in these statements. There have been no other recent accounting pronouncements or changes
in accounting pronouncements during the period ended May 31, 2025, that are of significance or potential significance to the Company.

 Note 4 – Property and equipment,
net

 The Company
has recorded the following Property and Equipment:

 May 31, 2025

 May 31, 2024

 Software acquisition costs

 $
 102,151

 $
 102,151

 Less accumulated depreciation

 (102,151
)

 (102,151
)

 Net Property and equipment

 $
 —

 $
 —

 Depreciation expense recorded for the
years ended May 31, 2025 and 2024 were $0 and $0, respectively.

 Note 5 - Related Party Transactions

 As
of May 31, 2025, and 2024, accounts payable
and accrued liabilities - related party due to Tom Zapatinas (Chief Executive Officer
and a Director of the Company)
totaled $400,000 and $300,000, respectively. During
the years ended May 31, 2025,
and 2024, Tom Zapatinas, earned
$100,000 and $60,000, respectively, for consulting services provided
to the Company.

 Advances
 - Related Par ty

 As
of May 31, 2025, and 2024, advances payable due to Tom Zapatinas totaled $102,716 and
$72,182, respectively. Advances are non-interest-bearing, unsecured
and payable on demand. During the years ended May 31,
2025, and 2024, Tom Zapatinas,
the Chief Executive Officer
and a Director of the
Company, advanced the Company
$30,108 and $22,156, respectively, in cash and was repaid $0 and
$1,658, respectively,
in cash.

 Loans Payable
 - Shareholders

 As
of May 31, 2025, and 2024, loans
payable - shareholders are $191,330
and $191,330, respectively. Loans payable - shareholders are unsecured, non-interest bearing and due on demand. During
the years ended May 31, 2025, and 2024, the Company
advanced $0 and $18,263, respectively, in cash, and was repaid $0 and $0, respectively, in cash.

 Liability for unissued shares

 As of May 31, 2025,
and 2024, the liability for unissued shares totaled $0 and $134,792, respectively. The stock associated with this liability had been issued
previously at par. As of May 31, 2025, this liability was settled by applying $100,000 to paid in capital and recognizing a $26,967 gain
on settlement. The remaining $7,825 was reclassified as Stock Subscriptions in the Equity section, pending issuance of 20,000 shares.

 Promissory
 Note - Related Par ty

 As
of May 31, 2025, and 2024,
promissory note - related party of
$466,817 and $466,817, respectively, is due to Tom Zapatinas,
the Chief Executive Officer
and a Director of the Company.
The Note is non-interest bearing, unsecured and payable on demand.

 F- 9

 Convertible Note
 Payable - Related Par ty

 As of May 31, 2025, and
2024, 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.

 Note 6 -
Income Taxes

 The Company elected to be taxed
as a corporation and adopted the provisions of uncertain tax positions as addressed in ASC 740-10-65-1. As a result of the implementation
of ASC 740-10-65-1, the Company recognized no increase in the liability for unrecognized tax benefits.

 The Company has no tax position
at May 31, 2025, or 2024, for which the ultimate deductibility is highly certain but for which there is uncertainty about the timing of
such deductibility. The Company does not recognize interest accrued related to unrecognized tax benefits in interest expense and penalties
in operating expenses. No such interest or penalties were recognized during the period presented. The Company had no accruals for interest
and penalties at May 31, 2025, or, 2024. The Company's utilization of any net operating loss carry forward may be unlikely as a
result of its intended activities.

 In assessing the realizability of
deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred income tax assets
will not be realized. The ultimate realization of deferred income tax assets is dependent upon the generation of future taxable income
during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred
income tax liabilities, projected future taxable income, and tax planning strategies in making this assessment.

 Based on consideration of these
items, management has determined that enough uncertainty exists relative to the realization of the deferred income tax asset balances
to warrant the application of a full valuation allowance as of May 31, 2024 and 2023. All tax years since inception remains open for examination
only by taxing authorities of US Federal, Canadian, and state of Nevada.

 Since the US tax rate is higher
than the effective Canadian tax rate, and the US tax code contains provisions for a foreign tax credit to avoid double taxation, the Company
is using the US corporate tax rate as the effective tax rate for all income.

 The components of the Company's
deferred tax assets and reconciliation of income taxes computed at the new federal, Canadian, and state statutory rate of 21.0% to the
income tax amount recorded as of May 31, 2025, and 2024, are as follows:

 May 31, 2025

 May 31, 2024

 Accumulated loss

 $
 5,210,390

 $
 5.125.380

 Book tax differences – stock-based comp

 (400,000
)

 (300,000
)

 Net operating loss and carryforwards

 $
 4,810,390

 $
 4,828,381

 Effective tax rate - US

 21.0
 %

 21.0
 %

 Deferred tax asset, rounded

 1,010,200

 1,014,000

 Less: Valuation allowance, rounded

 (1,010,200
)

 (1,014,000
)

 Net deferred asset

 $
 —

 $
 —

 During the years
ended May 31, 2025, and 2024, the
change in valuation allowance was a decrease of ($3,800) in 2025 and an increase
of $8,300 in 2024.

 Note 7 -
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, 2025, and 2024. Holders of Common Stock
have one vote per share of
Common Stock held.

 Note 8
- Contingencies and Commitments

 From
time to time the Company may be a
party to litigation matters involving claims against the
Company. Management believes that there are
no current matters that would have
a material effect on the Company's
financial position or results of operations.

 The Company does not have long-term commitments for equipment purchases or leases. The
Company presently operates from remote employment sites.

 F- 10

 Note 9 - Segment reporting

 FASB
ASU 2023-7 requires all public entities to expand segment reporting on all significant segments and to report significant segment expenses
when the chief operating decision maker uses this information to make decisions about resource allocation.

 The
Company was established to develop Health Savings Account software. During the fiscal year ended May 31, 2025. management continued to
work exclusively to develop this software and implement a sales program.

 Note 10 -
Subsequent Events

 The
Company has evaluated all subsequent
events through the date these financial statements were issued.

 On June 30,
2025, the CEO converted USD $1,525,577 in convertible debt to common stock at $0.10 per share.

 In June 2025, the Company signed
a Contractor agreement with INARE, Inc, an Alberta CA company, for the services of Pavel Bondarev to run two (2) subsidiaries and develop
new technologies and products for stock and management fees. Pavel Bondarev was also added to the Board of Directors of PreAxia. The Company
issued 16,5,000 shares of common stock for the contract at $0.10 per share.

 In June 2025, 1.500,000 shares
of stock were issued for services at $0.10 per share.

 In June 2025, the Company reestablished
a 2025 Stock Plan for 2.400,000 stock options.

 In August 2025, the Company received $200,000 from the sale
of 800,000 shares of common stock in a private placement and issued 400,000 shares of common stock for debt and services in the amount
of $100,000.

 In September 2025, the Company
established a new subsidiary, Zane Inc US, to market mobile banking and personal finance management platforms in the United States. Pavel
Bondarev will run both Zane subsidiaries.

 In September 2025, the Board
of Directors decided to start doing business as PreAxia-Zane Financial.

 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, 2025, 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 l
3a- l 5(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, 2025. 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, 2025, 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 2025.

 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 fiscal
year ended May 31, 2025, no director or Section 16 officer adopted
or terminated any Rule 10b5-l trading arrangements or non-Rule 10b5-l
trading arrangements.

 ITEM
10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

 Directors and
Executive Officers

 The
following individuals 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

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

 Director January 2007 Officer January 2009

 Paul Verberne

 Director

 Director June 2018

 Pavel Bondarev

 Director

 Director June 2025

 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 has 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 favored 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.

 Pavel Bondarev, member of
the Board of Directors

 Pavel Bondarev is a dynamic
and visionary executive with 15+ years of global experience leading Al, Data Science, Business Intelligence, and Digital Strategy across
banking & financial services, telecom, Saas, and emerging technologies. Proven track record in building and scaling high performing
teams, creating award-winning innovation, and delivering over $ZOOM in measurable business impact through AI and analytics platforms.
Recognized by the British Royal Society, the Russian Academy of Science, the Swiss and German National Research Foundations, and CBC's
Dragon's Den. Extensive board-level exposure in startup and corporate environments, with deep knowledge of technology commercialization,
digital transformation, and customer-centric strategy. He has a degree in Mechanical Engineering, postgraduate work at the University
of Westminster, UK and a PhD in Applied Mathematics & Computer Science from Southern Federal University, Russia.

 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 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 l(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

 Name

 Independence

 Financially Literate

 Not Independent

 CEO, CFO for over 30 years

 Paul Verberne

 Independent

 Corporate Lawyer

 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

 Neither Paul Verbeme, Pavel
Bondarev, nor Tom Zapatinas are directors 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 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 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 l 6(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, 2025, all filing requirements
applicable to our executive officers, directors and greater than I0% 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, 2025, and 2024 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 Award

 $

 Option Award

 $

 Non-Equity Incentive Plan

$

 Change in Pension Value and Non-Qualified Deferred Comp

$

 All Other Comp

$

 Total

$

 2025

 $

 $

 CEO, President

 2024

 $
 60,000

 $
 60,000

 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

 No executive officer held any outstanding
equity awards as of May 31, 2025.

 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, 2025.

 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, 2025. 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 August 15, 2025, 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 August 15, 2025, there were no shareholders known
by us to be beneficial owners 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)

 16,500,000

 32.0%

 3212 – 14 Avenue SW

 Calgary, AB T3C 0X3

 Paul Verberne

 3212 – 14 Avenue SW

 Calgary, AB T3C 0X3

 -

 -

 Paul Bondarev

 3212 – 14 Avenue SW

 Calgary, AB T3C 0X3

 16,500,000

 32.0%

 All officers and directors as a group (2 persons)

 33,000,000

 64.00%

 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 53,824,000 issued shares of common stock
as of August 31, 2025, 43,024,000 outstanding and
10,800,000 in treasury.

 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, 2025, 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, 2025, the Company's president, Tom Zapatinas, invoiced
$100,000 for management services
rendered to the Company, advanced $30,534 in cash and received repayments of $0 in
cash. As of May 31, 2025, Accounts payable - related party and Advances - related party include a total of $102,716 due for advances and $400,000 due as officer compensation
payable to Mr. Zapatinas. The balances as of May 31, 2024, were $72,182 and $300,000,
respectively.

 2.
As of May 31, 2025 and 2024, loans payable - shareholders are $201,331 and $191,330, 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, 2025, and 2024, the Company was
advanced $0 and $0, respectively,
in cash, and was repaid $10,000 and $0, respectively, in cash.

 3.
As of May 31, 2025, and 2024, promissory note - related party of $466,817 and $466,817, respectively,
is due to Tom Zapatinas, the Chief Executive Officer and a Director of the Company. The Note is non-interest bearing, unsecured and payable
on demand.

 4.
As of May 31, 2025 and 2024, 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 registered audit firms for the completed fiscal periods ended May 31, 2025 and 2024 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

 Year Ended

 May 31, 2024

 May 31,
 2025

 Audit Fees and Audit Related Fees
 GreenGrowthCPAs

 $ 25,000

 -

 Audit Fees and Reviews – Fruci
 & Associates

 -

 $ 19,000

 Tax Fees

 Total

 $
 25,000

 $
 19,000

 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

 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

 *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.

 Isl

 By: Tom Zapatinas, President and Director

 (Principal Executive Officer,
Principal Financial Officer and Director) Dated: September 12, 2025

 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.

 Isl

 By: Tom Zapatinas, President and Director

 (Principal Executive Officer,
Principal Financial Officer and Director) Dated September 12, 2025

 I sl Paul Verberne

 By: Paul Verbeme, Director Dated:
September 12, 2025