{"url_path":"/sec/upyy/10-k/2026/item-8","section_key":"item-8","section_title":"Item 8 FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA","topic":"sec","document":{"doc_type":"10-K","doc_date":"2026-06-02","source_url":"https://www.sec.gov/Archives/edgar/data/1677897/0001575872-26-000390-index.html","accession_number":"0001575872-26-000390","cik":"0001677897","ticker":"UPYY","issuer_name":"UPAY","edgar_url":"https://www.sec.gov/Archives/edgar/data/1677897/0001575872-26-000390-index.html","primary_entity_key":"0001677897","primary_entity_name":"UPAY"},"word_count":9529,"has_tables":true,"body_markdown":"ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA\n\nUPAY, Inc.\n\nConsolidated Financial Statements\n\nIndex\n\nTable of Contents\n\n[Report of Independent Registered Public Accounting Firm (PCAOB ID: 2738](#a_001_reportofindepen)[)](#a_001_reportofindepen)\n\n[F-2](#a_001_reportofindepen)\n\n[Consolidated Balance Sheets](#a_026_)\n\n[F-3](#a_026_)\n\n[Consolidated Statements of Operations and Comprehensive Loss](#a_027_)\n\n[F-4](#a_027_)\n\n[Consolidated Statements of Stockholders’ Deficit and Accumulated Other Comprehensive Loss](#a_028_)\n\n[F-5](#a_028_)\n\n[Consolidated Statements of Cash Flows](#a_029_)\n\n[F-6](#a_029_)\n\n[Notes to the Consolidated Financial Statements](#a_030_)\n\n[F-7](#a_030_)\n\nF-1\n\nREPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM\n\n \n\nTo the Board of Directors and\n\nStockholders of UPAY, Inc.\n\n \n\nOpinion on the Consolidated Financial Statements\n\n \n\nWe have audited the accompanying consolidated balance sheets of UPAY, Inc. and Subsidiaries (the Company) as of February 28, 2026 and 2025, and the related consolidated statements of operations and comprehensive loss, stockholders’ deficit and accumulated other comprehensive loss, and cash flows for each of the years in the two-year period ended February 28, 2026 and the related notes (collectively referred to as the \"financial statements\"). In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of February 28, 2026 and 2025, and the results of its operations and its cash flows for each of the years in the two-year period ended February 28, 2026, in conformity with accounting principles generally accepted in the United States of America.\n\n \n\nGoing Concern\n\n \n\nThe accompanying consolidated financial statements have been prepared assuming the Company will continue as a going concern. As discussed in Note 2 to the consolidated financial statements, the company has incurred recurring losses from operations and had not yet achieved profitable operations as of February 28, 2026 which raises substantial doubt about its ability to continue as a going concern. Management’s plans regarding these matters are also described in Note 2. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.\n\n \n\nBasis for Opinion\n\n \n\nThese consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.\n\n \n\nWe conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.\n\n \n\nOur audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.\n\n \n\nCritical Audit Matters\n\n \n\nThe critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing separate opinions on the critical audit matter or on the accounts or disclosures to which it relates.\n\n \n\nGoing Concern\n\nAs discussed in Note 2 to the consolidated financial statements, the Company has incurred continuing losses from operations and has a significant accumulated deficit.\n\n \n\nAuditing management’s evaluation of a going concern can be a significant judgement given the fact that the Company uses management estimates on future revenues and expenses which are not able to be substantiated.\n\n \n\nTo evaluate the appropriateness of the going concern, we examined and evaluated the financial information that was the initial cause along with management’s plans to mitigate going concern and management’s disclosure on going concern.\n\n \n\n/s/ M&K CPAS, PLLC\n\nWe have served as the Company’s auditor since 2018.\n\n \n\nThe Woodlands, TX\n\n \n\nJune 2, 2026\n\nF-2\n\n \n\nUPAY, INC.\n\nConsolidated Balance Sheets\n\n(Expressed in U.S. dollars)\n\n \n\n \n\n \n\nFebruary 28,\n\n2026\n\n \n\n \n\n \n\n \n\nFebruary 28,\n\n2025\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nASSETS\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCurrent Assets\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCash and cash equivalents\n\n \n\n$\n\n96,279\n\n \n\n \n\n$\n\n55,362\n\n \n\nAccounts receivable, net of allowance\n\n \n\n \n\n44,553\n\n \n\n \n\n \n\n39,704\n\n \n\nPrepaid expenses and other current assets\n\n \n\n \n\n12,779\n\n \n\n \n\n \n\n52,648\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nTotal Current Assets\n\n \n\n \n\n153,611\n\n \n\n \n\n \n\n147,714\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nProperty and Equipment, Net (Note 3)\n\n \n\n \n\n13,048\n\n \n\n \n\n \n\n15,912\n\n \n\nRight-of-use Assets, Net (Note 4)\n\n \n\n \n\n48,166\n\n \n\n \n\n \n\n59,716\n\n \n\nDeposit (Note 11)\n\n \n\n \n\n12,584\n\n \n\n \n\n \n\n10,807\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nTotal Assets\n\n \n\n$\n\n227,409\n\n \n\n \n\n$\n\n234,149\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nLIABILITIES AND STOCKHOLDERS’ DEFICIT\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCurrent Liabilities\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nAccounts payable and accrued liabilities\n\n \n\n$\n\n138,317\n\n \n\n \n\n$\n\n133,172\n\n \n\nDue to related parties (Note 5)\n\n \n\n \n\n61,484\n\n \n\n \n\n \n\n80,817\n\n \n\nCurrent portion of lease liabilities (Note 7)\n\n \n\n \n\n23,383\n\n \n\n \n\n \n\n17,077\n\n \n\nCurrent portion of notes payable (Note 6)\n\n \n\n \n\n1,642\n\n \n\n \n\n \n\n1,635\n\n \n\nCurrent portion of notes payable in default (Note 6)\n\n \n\n \n\n50,500\n\n \n\n \n\n \n\n50,500\n\n \n\nNotes payable – Related parties (Note 5)\n\n \n\n \n\n145,000\n\n \n\n \n\n \n\n251,000\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nTotal Current Liabilities\n\n \n\n$\n\n420,326\n\n \n\n \n\n \n\n534,201\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nNon-Current Liabilities\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nLease liabilities (Note 7)\n\n \n\n \n\n24,783\n\n \n\n \n\n \n\n42,639\n\n \n\nNotes payable (Note 6)\n\n \n\n \n\n76,158\n\n \n\n \n\n \n\n76,165\n\n \n\nNotes payable – Related parties (Note 5)\n\n \n\n \n\n220,000\n\n \n\n \n\n \n\n50,000\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nTotal Liabilities\n\n \n\n$\n\n741,267\n\n \n\n \n\n \n\n703,005\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nStockholders’ Deficit\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nPreferred Stock, $0.001 par value, 10,000,000 shares authorized; no shares issued and outstanding\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\nCommon Stock, $0.001 par value, 100,000,000 shares authorized; 17,595,211 and 16,595,211 shares issued and outstanding, respectively\n\n \n\n \n\n17,595\n\n \n\n \n\n \n\n16,595\n\n \n\nCommon Stock Issuable\n\n \n\n \n\n240,500\n\n \n\n \n\n \n\n103,500\n\n \n\nAdditional Paid-in Capital\n\n \n\n \n\n2,865,037\n\n \n\n \n\n \n\n1,646,037\n\n \n\nAccumulated Deficit\n\n \n\n \n\n(3,569,874\n\n)\n\n \n\n \n\n(2,163,251\n\n)\n\nAccumulated Other Comprehensive Loss\n\n \n\n \n\n(67,116\n\n)\n\n \n\n \n\n(71,737\n\n)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nTotal Stockholders’ Deficit\n\n \n\n \n\n(513,858\n\n)\n\n \n\n \n\n(468,856\n\n)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nTotal Liabilities and Stockholders’ Deficit\n\n \n\n$\n\n227,409\n\n \n\n \n\n$\n\n234,149\n\n \n\n \n\nThe accompanying notes are an integral part of these consolidated financial statements.\n\n \n\nF-3\n\n \n\nUPAY, Inc.\n\nConsolidated Statements of Operations and Comprehensive Loss\n\n(Expressed in U.S. dollars)\n\n \n\n \n\n \n\nYear\n\n \n\n \n\nYear\n\n \n\n \n\n \n\nEnded\n\n \n\n \n\nEnded\n\n \n\n \n\n \n\nFebruary 28,\n\n \n\n \n\nFebruary 28,\n\n \n\n \n\n \n\n2026\n\n \n\n \n\n2025\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nRevenue\n\n \n\n$\n\n746,311\n\n \n\n \n\n$\n\n715,269\n\n \n\nCost of revenue\n\n \n\n \n\n(198,801\n\n)\n\n \n\n \n\n(270,906\n\n)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nGross Profit\n\n \n\n \n\n547,510\n\n \n\n \n\n \n\n444,363\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nExpenses\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nDepreciation (Note 3)\n\n \n\n \n\n6,917\n\n \n\n \n\n \n\n7,650\n\n \n\nGeneral and administrative\n\n \n\n \n\n994,110\n\n \n\n \n\n \n\n945,570\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nTotal Expenses\n\n \n\n \n\n1,001,027\n\n \n\n \n\n \n\n953,220\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nLoss Before Other Income (Expenses) and Income Taxes\n\n \n\n \n\n(453,517\n\n)\n\n \n\n \n\n(508,857\n\n)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nOther Income (Expenses)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nInterest income\n\n \n\n \n\n1,129\n\n \n\n \n\n \n\n3,436\n\n \n\nInterest expense\n\n \n\n \n\n(49,835\n\n)\n\n \n\n \n\n(34,641\n\n)\n\nLoss on settlement of debt (Note 5)\n\n \n\n \n\n(904,400\n\n)\n\n \n\n \n\n–\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nLoss Before Income Taxes\n\n \n\n \n\n(1,406,623\n\n)\n\n \n\n \n\n(540,062\n\n)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nProvision for income taxes\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nNet Loss\n\n \n\n \n\n(1,406,623\n\n)\n\n \n\n \n\n(540,062\n\n)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nOther Comprehensive Income\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nForeign currency translation adjustments\n\n \n\n \n\n4,621\n\n \n\n \n\n \n\n5,510\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nComprehensive Loss\n\n \n\n$\n\n(1,402,002\n\n)\n\n \n\n$\n\n(534,552\n\n)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nNet Loss Per Share – Basic and Diluted\n\n \n\n$\n\n(0.08\n\n)\n\n \n\n$\n\n(0.03\n\n)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nWeighted-average Common Shares Outstanding – Basic and Diluted\n\n \n\n \n\n17,274,454\n\n \n\n \n\n \n\n16,179,947\n\n \n\n \n\nThe accompanying notes are an integral part of these consolidated financial statements.\n\n \n\nF-4\n\n \n\n \n\nUPAY, Inc.\n\nConsolidated Statement of Stockholders’ Deficit and Accumulated Other Comprehensive Loss\n\n(Expressed in U.S. dollars)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nAccumulated\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nAdditional\n\n \n\n \n\nCommon\n\n \n\n \n\n \n\n \n\n \n\nOther\n\n \n\n \n\n \n\n \n\n \n\n \n\nCommon Stock\n\n \n\n \n\nPaid-in\n\n \n\n \n\nStock\n\n \n\n \n\nAccumulated\n\n \n\n \n\nComprehensive\n\n \n\n \n\n \n\n \n\n \n\n \n\nShares\n\n \n\n \n\nAmount\n\n \n\n \n\nCapital\n\n \n\n \n\nIssuable\n\n \n\n \n\nDeficit\n\n \n\n \n\nLoss\n\n \n\n \n\nTotal\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nBalance – February 29, 2024\n\n \n\n \n\n15,708,544\n\n \n\n \n\n$\n\n15,708\n\n \n\n \n\n$\n\n1,116,590\n\n \n\n \n\n$\n\n313,331\n\n \n\n \n\n$\n\n(1,623,189\n\n)\n\n \n\n$\n\n(77,247\n\n)\n\n \n\n$\n\n(254,807\n\n)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCommon stock issued for cash\n\n \n\n \n\n200,000\n\n \n\n \n\n \n\n200\n\n \n\n \n\n \n\n99,800\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n100,000\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCommon stock issued for Huntpal LLC acquisition\n\n \n\n \n\n220,000\n\n \n\n \n\n \n\n220\n\n \n\n \n\n \n\n(220\n\n)\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCommon stock issuable for services\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n153,500\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n153,500\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCommon stock issued for services\n\n \n\n \n\n466,667\n\n \n\n \n\n \n\n467\n\n \n\n \n\n \n\n429,867\n\n \n\n \n\n \n\n(363,331\n\n)\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n67,003\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nNet loss\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n(540,062\n\n)\n\n \n\n \n\n–\n\n \n\n \n\n \n\n(540,062\n\n)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nForeign currency translation adjustments\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n5,510\n\n \n\n \n\n \n\n5,510\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nBalance – February 28, 2025\n\n \n\n \n\n16,595,211\n\n \n\n \n\n$\n\n16,595\n\n \n\n \n\n$\n\n1,646,037\n\n \n\n \n\n$\n\n103,500\n\n \n\n \n\n$\n\n(2,163,251\n\n)\n\n \n\n$\n\n(71,737\n\n)\n\n \n\n$\n\n(468,856\n\n)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCommon stock issued for cash\n\n \n\n \n\n200,000\n\n \n\n \n\n \n\n200\n\n \n\n \n\n \n\n99,800\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n100,000\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCommon stock issued for settlement of debt\n\n \n\n \n\n800,000\n\n \n\n \n\n \n\n800\n\n \n\n \n\n \n\n1,119,200\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n1,120,000\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCommon stock issuable for services\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n137,000\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n137,000\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nNet loss\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n(1,406,623\n\n)\n\n \n\n \n\n–\n\n \n\n \n\n \n\n(1,406,623\n\n)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nForeign currency translation adjustments\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\n \n\n4,621\n\n \n\n \n\n \n\n4,621\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nBalance – February 28, 2026\n\n \n\n \n\n17,595,211\n\n \n\n \n\n$\n\n17,595\n\n \n\n \n\n$\n\n2,865,037\n\n \n\n \n\n$\n\n240,500\n\n \n\n \n\n$\n\n(3,569,874\n\n)\n\n \n\n$\n\n(67,116\n\n)\n\n \n\n$\n\n(513,858\n\n)\n\n \n\nThe accompanying notes are an integral part of these consolidated financial statements.\n\n \n\nF-5\n\n \n\n \n\nUPAY, Inc.\n\nConsolidated Statements of Cash Flows\n\n(Expressed in U.S. dollars)\n\n \n\n \n\n \n\nYear\n\nEnded\n\nFebruary 28,\n\n2026\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nYear\n\nEnded\n\nFebruary 28,\n\n2025\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCash Flows from Operating Activities\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nNet Loss\n\n \n\n$\n\n(1,406,623\n\n)\n\n \n\n$\n\n(540,062\n\n)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nAdjustments to reconcile net loss to net cash used in operating activities:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nAmortization of right-of-use assets\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\nCommon stock issued or issuable for services\n\n \n\n \n\n137,000\n\n \n\n \n\n \n\n181,420\n\n \n\nDepreciation\n\n \n\n \n\n6,917\n\n \n\n \n\n \n\n7,650\n\n \n\nLoss on settlement of debt\n\n \n\n \n\n904,400\n\n \n\n \n\n \n\n–\n\n \n\nProvision for bad debt\n\n \n\n \n\n14,705\n\n \n\n \n\n \n\n3,366\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nChanges in operating assets and liabilities:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nAccounts receivable\n\n \n\n \n\n(15,450\n\n)\n\n \n\n \n\n33,622\n\n \n\nPrepaid expenses and other current assets\n\n \n\n \n\n40,413\n\n \n\n \n\n \n\n(10,575\n\n)\n\nAccounts payable and accrued liabilities\n\n \n\n \n\n(9,572\n\n)\n\n \n\n \n\n(466,144\n\n)\n\nAccounts payable – related party\n\n \n\n \n\n40,171\n\n \n\n \n\n \n\n26,049\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nNet Cash Used in Operating Activities\n\n \n\n \n\n(288,039\n\n)\n\n \n\n \n\n(764,674\n\n)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCash Flows from Investing Activities\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nPurchase of property and equipment\n\n \n\n \n\n(1,993\n\n)\n\n \n\n \n\n–\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nNet Cash Used in Investing Activities\n\n \n\n \n\n(1,993\n\n)\n\n \n\n \n\n–\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCash Flows from Financing Activities\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nProceeds from common stock issued for cash\n\n \n\n \n\n100,000\n\n \n\n \n\n \n\n100,000\n\n \n\nProceeds from notes payable to related party\n\n \n\n \n\n220,000\n\n \n\n \n\n \n\n50,000\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nNet Cash Provided by Financing Activities\n\n \n\n \n\n320,000\n\n \n\n \n\n \n\n150,000\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nEffect of Exchange Rate Changes on Cash\n\n \n\n \n\n10,949\n\n \n\n \n\n \n\n27,190\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nChange in Cash and Cash Equivalents\n\n \n\n \n\n40,917\n\n \n\n \n\n \n\n(587,484\n\n)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCash and Cash Equivalents - Beginning of Year\n\n \n\n \n\n55,362\n\n \n\n \n\n \n\n642,846\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCash and Cash Equivalents - End of Year\n\n \n\n$\n\n96,279\n\n \n\n \n\n$\n\n55,362\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nSupplemental Disclosures of Cash Flow Information:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nInterest paid\n\n \n\n$\n\n49,835\n\n \n\n \n\n$\n\n34,641\n\n \n\nIncome taxes paid\n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n–\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nNon-cash Investing and Financing Activities:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCommon stock issued for prepaid services\n\n \n\n$\n\n–\n\n \n\n \n\n$\n\n39,083\n\n \n\nCommon stock issued to settle debt\n\n \n\n$\n\n1,120,000\n\n \n\n \n\n$\n\n–\n\n \n\n \n\nThe accompanying notes are an integral part of these consolidated financial statements.\n\n \n\nF-6\n\n \n\n \n\n1.\n\nNature of Operations and Continuance of Business\n\n \n\nUPAY, Inc. (the “Company”) was incorporated in the State of Nevada on July 8, 2015. By a Share Exchange Agreement dated November 4, 2015, the Company agreed to acquire all of the issued and outstanding shares of Rent Pay (Pty) Ltd (“Rent Pay”), in exchange for 200,000 shares of the Company’s common stock. The acquisition was a capital transaction in substance and therefore was accounted for as a recapitalization. Rent Pay was incorporated in South Africa on February 1, 2012. Because Rent Pay was deemed to be the acquirer for accounting purposes, the consolidated financial statements are presented as a continuation of Rent Pay and include the results of operations of Rent Pay since incorporation on February 1, 2012, and the results of operations of the Company since the date of acquisition on November 4, 2015. On March 2, 2022, the Company acquired a controlling interest in Miway Finance Inc. (“Miway”), which was determined to be a transaction between entities under common control. On May 30, 2023, the Company incorporated a wholly-owned subsidiary, taking a 51% controlling interest in Huntpal LLC (“Huntpal”). On June 13, 2024, the Company acquired the remaining non-controlling interest in Huntpal, increasing its ownership to 100%. On May 28, 2024, the Company acquired a controlling interest in AML Go (Pty) Ltd (“AML”) which was incorporated on July 3, 2023. AML was determined to be an entity under common control, and the transaction was considered immaterial due to the nominal assets and liabilities at the time of acquisition.\n\n \n\nRent Pay operates principally in South Africa and engages in software development and licensing and provides services to the credit provider industry.\n\n \n\n2.\n\nSummary of Significant Accounting Policies\n\n \n\na)\n\nBasis of Presentation\n\n \n\nThese consolidated financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States, and are expressed in U.S. dollars. The Company’s fiscal year end is February 28. The consolidated financial statements include the accounts of the Company, its wholly-owned subsidiaries, Rent Pay and Huntpal LLC, and its controlled subsidiaries, Miway and AML. The Company owns 48% of Miway and 51% of AML.\nMiway is controlled by the Company as the Company has the power to direct its activities and has the obligation to absorb loss from, or right to receive benefits of, Miway.\n \n\nAll significant intercompany transactions and accounts have been eliminated in consolidation.\n\n \n\nb)\n\nUse of Estimates\n\n \n\nThe preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. The Company regularly evaluates estimates and assumptions related to useful life and recoverability of long-lived assets, and deferred income tax asset valuations. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company’s estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.\n\n \n\nc)\n\nCash and Cash Equivalents\n\n \n\nCash includes cash on hand and cash held with banks. The Company considers all highly liquid instruments with maturity of three months or less at the time of issuance to be cash equivalents. The Company\n\n’\n\ns accounts at each U.S. institution are insured by the Federal Deposit Insurance Corporation (\n\n“\n\nFDIC\n\n”\n\n) up to $250,000. As at February 28, 2026, the Company did not have any cash held in U.S. institutions in excess of the FDIC insured limit.\n\n \n\nd)\n\nAccounts Receivable\n\n \n\nTrade accounts receivable are recorded at net invoice value and such receivables are non-interest bearing. Receivables are considered past due based on the contractual payment terms.\nReceivables\nare reviewed and specific amounts are reserved if collectability is no longer reasonably assured.\n\n \n\nAs at February 28, 2026, the Company has recognized an allowance for doubtful accounts of $9,030 (2025 - $1,892)\n\n \n\n \n\nF-7\n\n \n\n \n\ne)\n\nProperty and Equipment\n\n \n\nProperty and equipment are stated at cost, less accumulated depreciation, and any impairment in value. Depreciation is computed using the straight-line method over the following estimated lives of the assets:\n\n \n\nComputer equipment\n\n \n\n \n\n3 years\n\n \n\nComputer software\n\n \n\n \n\n5 years\n\n \n\nOffice equipment\n\n \n\n \n\n5 years\n\n \n\nVehicles\n\n \n\n \n\n5 years\n\n \n\nFurniture and fixtures\n\n \n\n \n\n6 years\n\n \n\n \n\nThe Company periodically performs impairment testing on its long-lived assets either annually or whenever events or changes in circumstances indicate that the carrying amount may not be recoverable in accordance with ASC 360. All property and equipment assets were deemed recoverable at February 28, 2026, and 2025.\n\n \n\nf)\n\nRight-of-use Assets\n\n \n\nRight-of-use assets are stated at cost, less accumulated amortization and any impairment in value. Amortization is computed using the straight-line method over the following estimated lives of the assets:\n\n \n\nRight-of-use building\n\n \n\n \n\nTerm of lease\n\n \n\nRight-of-use vehicles\n\n \n\n \n\n5 years\n\n \n\n \n\nThe Company periodically performs impairment testing on its long-lived assets either annually or whenever events or changes in circumstances indicate that the carrying amount may not be recoverable in accordance with ASC 360. All right-of-use assets were deemed recoverable at February 28, 2026, and 2025.\n\n \n\ng)\n\nValue of Financial Instruments\n\n \n\nThe Company measures and discloses the estimated fair value of financial assets and liabilities using the fair value hierarchy in accordance with ASC 820, “\n\nFair Value Measurements and Disclosures\n\n”. The fair value hierarchy has three levels, which are based on reliable available inputs of observable data. The hierarchy requires the use of observable market data when available.\n\n \n\nThe three-level hierarchy is defined as follows:\n\n \n\nLevel 1 – quoted prices for identical instruments in active markets.\n\n \n\nLevel 2 – quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model derived valuations in which significant inputs and significant value drivers are observable in active markets.\n\n \n\nLevel 3 – fair value measurements derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.\n\n \n\nFinancial instruments consist principally of cash and cash equivalents, accounts receivable, accounts payable, due to related parties, taxes payable and notes payable. There were no transfers into or out of “Level 3” during the year ended February 28, 2026, and 2025. The recorded values of all financial instruments approximate their current fair values because of their nature and respective relatively short maturity dates or durations.\n\n \n\nFair value estimates are made at a specific point in time, based on relevant market information and information about the financial statement. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Changes in assumptions could significantly affect the estimates.\n\n \n\nh)\n\nForeign Currency Translation\n\n \n\nManagement has adopted ASC 830, “\n\nForeign Currency Translation Matters\n\n”, as the functional currency of the Company is the South African rand and the reporting currency is U.S. dollars. Assets and liabilities are translated into U.S. dollars at rates of exchange in effect at the balance sheet date. Average rates for the period are used to translate revenues and expenses. The cumulative translation adjustment is reported as a\ncomponent\nof accumulated other comprehensive loss.\n\n \n\n \n\nF-8\n\ni)\n\n \n \n  \n\nLeases\n\nEffective March 1, 2019, the Company adopted FASB ASC Topic 842,\n\nLeases\n\n(“ASC 842”). This standard requires lessees to recognize in the statement of financial position a liability to make lease payments and a right-of-use (“ROU”) asset representing the Company’s right to use the underlying asset for the lease term. At the inception of an arrangement, the Company determines whether the arrangement is or contains a lease based on the unique facts and circumstances within the arrangement. A lease is identified where an arrangement conveys the right to control the use of identified property, plant, and equipment for a period of time in exchange for consideration. Leases which are identified within the scope of ASC 842 and which have a term greater than one year are recognized on the Company’s balance sheet as ROU assets and lease liabilities. Operating lease liabilities and their corresponding ROU assets are recorded based on the present value of lease payments over the expected remaining lease term. The lease term includes any renewal options and termination options that are reasonably certain to be exercised. Certain adjustments to the right-of-use asset may be required for items such as initial direct costs paid or incentives received. The present value of lease payments is determined by using the interest rate implicit in the lease, if that rate is readily determinable; otherwise, the Company uses it’s incremental borrowing rate. The incremental borrowing rate is determined based on the rate of interest that the Company would pay to borrow on a collateralized basis an amount equal to the lease payments for a similar term and in a similar economic environment. The interest rate implicit in lease contracts to calculate the present value is typically not readily determinable. As such, significant management judgment is required to estimate the incremental borrowing rate.\n\nj)\n\nRevenue Recognition\n\nThe Company recognizes revenue in accordance with ASC 606,\n\nRevenue from Contracts with Customers\n\n. The guidance under ASC 606 is based on the principle that an entity should recognize revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to fulfill a contract. Under ASC 606, the Company recognizes revenue by applying the following steps: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to each performance obligation in the contract; and (5) recognize revenue when each performance obligation is satisfied.\n\nThe Company derives revenue through licensing its software and by collecting various transaction fees from third party debit orders.\n\nThe Company has several revenue streams and they are recognized as below:\n\n \n\nBranch Setup Fees\n\nThis is a once off, non-refundable cost that the company charges when a customer is onboarded. Revenue is recognized immediately and is collected in the same month. This results in no accounts receivable at the end of the month as revenue is recognized and collected immediately.\n\n \n\nData Migration Fees\n\nThis only applies to a customer applying to migrate client data from a previous system to our system. We invoice for this service as soon as data is successfully transferred, imported and verified by our customer. Revenue is recognized upon invoicing and payment is collected within two days due to debit order mandates signed by the customer as part of the agreement. This results in no outstanding accounts receivable as of the end of each month.\n\n \n\nMonthly Rental Fees\n\nOur software is made available on a web-based software platform and is offered as software as a service. Our agreement is an evergreen agreement (auto-renewed) and if not terminated by a customer, remains intact. Termination may occur by either party at any point with 30 days’ notice. The monthly software rental fee is payable every month per branch. Monthly software rental fees are payable in the beginning of each month. The monthly rental fees are invoiced during the first few days of a month and is recognized over the period of the month. Payments are collected via debit order a few days later, prior to the end of that month, due to debit order mandate signed by the customer. This results in no accounts receivable as invoicing and payment happens within the same month.\n\n \n\nDevelopment Service Fee\n\nWe have some clients that we do custom software development for, on some versions of our software. Here we adopt a scrum methodology with 2-week development sprints. We agree on a price per hour for development with these clients, typically through email communication. We send an invoice for the work completed and usually get paid within the same month. On this revenue stream we do not run a debit order, but clients need to pay invoices before we continue with the next development increment. Payments are due and revenue is recognized upon invoicing. At times collecting payment can take up to 30 days. Unpaid invoices, if any, are recorded to accounts receivable at the end of each month, but invoicing and payment usually happen within the same month.\n\nF-9\n\n \n\n \n\nTransactional Fees\n\nWe offer an integrated debit order facility built into our software. When our clients (lenders) create loans with consumers, the consumer contracts directly with us on a separate agreement. We then act as a third-party payment provider, to facilitate the repayment of loans from the consumer to the lender by debit order. We are registered as a third-party payment provider and all payments collected on this stream are settled by the bank directly into our bank account. We only charge a fee on successful debit order collections and retain that fee when we distribute funds collected on behalf of consumers. The transaction fees charged for these transactions are called CTC and they are displayed on the signed agreement that the consumer signs with us. The CTC fees are paid by the consumer, in addition to the loan installment collected. The loan installment and CTC are collected as one amount, but the CTC is retained by us upon distribution of funds to lenders. Revenue is recognized as each new order is processed and the transaction fee is charged. Our software system counts and accounts for each individual transaction and its amount and this is generated on a report on our Acpas software. We use this report to confirm the revenue recognition in our billing system. If there are any CTC that has yet to be collected at an end of a period, it is recorded as accounts receivable.\n\n \n\nCredit Protection Insurance Commission\n\nSome insurance companies offer insurance products on loans that cover the consumer for the full repayment of their debt to the lender, in case of unforeseen events. There is an insurance product from one of our suppliers (an insurance company) that we make available for the insurance company on our software program. In return for making this product available the insurance company would pay us monthly commission on premiums they received. This is a product offered by the insurance company directly to the consumer and we only make it available on our software platform. If this option is selected when a loan is created, an additional fee is added to the loan repayment amount. The software system calculates the insurance premiums and all premiums for a given month are paid by lenders to the insurance company, or lenders use our payment service and instruct us to manage the payments on their behalf. After receiving the premiums and supporting reports, the insurance company will then calculate and verify the premiums paid and premium claw back to this point and work out the commission payable based on the premiums received. Upon collection of the premiums, the insurance company will complete their final calculations and the insurance company will then pay all commissions earned by us and the lenders. We distribute the commission amounts due to the lenders within two days of receiving such payments from the insurance company. Revenue is recognized upon collection of the premiums from the consumers.\n\n \n\nCredit Bureau transactions\n\nSome credit bureaus like XDS or VeriCred, offer consumer screening products, that we make available on our software platform as integration. Lenders can sign up for these service and access credit information of consumers that they would like to screen, directly from our software platform. In return for making these products available on a seamless integration, we charge a fee on the products. The Company enters into an agreement with the credit bureau and lender to the agreed fees. The agreement with the credit bureau determines the commission fee paid or the markup to be charged on transactions by the company,\nas\nreseller. If there are any credit bureau fees that has yet to be collected at an end of a period, it is recorded as accounts receivable.\n\n \n\nPayroll Transactions\n\nSome of our client (lenders) have arrangements with employers where these employers deduct loan installments payable to the lender from the payroll of that employer, on behalf of the lender. The deduction is made from employees that have taken loans from the lender. We provide these payroll lenders with adequate reporting in our software,\nwhich\ncan be used to help identify the amounts to be deducted from each individual consumer, with unique identifiers, which is sent to the employers. We also assist lenders to capture payments received from employers on our software in bulk, where requested. We charge a payroll transaction fee to the lender, for each successful payment made in a month on the system. The fee is charged as a combined amount for the payments received on payroll for that month. The payroll transaction fees are set out and agreed to with the lender on the signed agreement they have with us. Our software system counts and accounts for each individual payment receipted, and this is generated on a payment report on our ACPAS software. We use this report for revenue recognition in our billing system. Revenue is recorded as a lump sum based on this report at the end of each month. If there are any payroll transaction fees, that still needs to be recognized at an end of a period, it is recorded as accounts receivable.\n\nk)\n\nStock-based Compensation\n\nThe Company records stock-based compensation in accordance with ASC 718, “\n\nCompensation – Stock Compensation\n\n” and ASC 505, “\n\nEquity\nBased Payments to Non-Employees\n\n”, using the fair value method. All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable.\n\nF-10\n\n \n\n \n\nl)\n\nComprehensive Income (Loss)\n\n \n\nASC 220, “\n\nComprehensive Income”,\n\nestablishes standards for the reporting and display of comprehensive income (loss) and its components in the financial statements. As at February 28, 2026 and 2025, the only item that represents comprehensive income (loss) was foreign currency translation.\n\n \n\nm)\n\nEarnings (Loss) Per Share\n\n \n\nThe Company computes earnings (loss) per share (“EPS”) in accordance with ASC 260, “\n\nEarnings per Share\n\n”. ASC 260 requires presentation of both basic and diluted earnings per share on the face of the statement of operations. EPS is calculated using the weighted-average number of common shares outstanding during the period. Diluted EPS if applicable is calculated by dividing net income available to common stockholders for the period by the diluted weighted-average number of common shares outstanding during the period. Diluted EPS would reflect the potential dilution from common shares issuable through stock options, performance-based restricted stock units that have satisfied their performance factor and restricted stock units using the treasury stock method.\n\n \n\nn)\n\nIncome Taxes\n\n \n\nPursuant to ASC 740,\n\nIncome Taxes\n\n, the Company is required to compute tax asset benefits for net operating losses carried forward. The potential benefits of net operating losses have not been recognized in these financial statements because the Company cannot be assured it is more likely than not it will utilize the net operating losses carried forward in future years.\n\n \n\nThe Company must make certain estimates and judgments in determining income tax expense for financial statement purposes. These estimates and judgments occur in the calculation of certain tax assets and liabilities, which arise from differences in the timing of recognition of revenue and expense for tax and financial statement purposes.\n\n \n\nDeferred tax assets and liabilities are determined based on the differences between financial reporting and the tax basis of assets and liabilities using the tax rates and laws in effect when the differences are expected to reverse. ASC 740 provides for the recognition of deferred tax assets if realization of such assets is more likely than not to occur. Realization of the Company’s net deferred tax assets is dependent upon our generating sufficient taxable income in future years in appropriate tax jurisdictions to realize benefit from the reversal of temporary differences and from net operating loss, or NOL, carryforwards.\n\n \n\no)\n\nGoing Concern\n\n \n\nThe accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the liquidation of liabilities in the normal course of business. As of February 28, 2026, the Company does not have revenues sufficient to execute its business plan. The Company intends to fund operations through equity financing arrangements. There is no assurance that this will be successful. These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.\n\n \n\np)\n\nSegment Information\n\n \n\nIn accordance with the provisions of ASC 280-10,\n\n“Disclosures about Segments of an Enterprise and Related Information,”\n\nthe Company is required to report financial and descriptive information about its reportable operating segments. The Company has one operating segment as of February 28, 2026, and February 28, 2025. The Company manages its operations as a single operating segment for the purpose of assessing performance and making operating decisions. Accordingly, all assets are considered to relate to the single operating segment and are consistent with the total assets presented on the Company’s consolidated balance sheet. The Company’s Chief Operating Decision Maker (“CODM”) is its executive management committee. The CODM allocates resources and evaluates the performance of the Company using information about combined net income from operations. All significant operating decisions are based upon an analysis of the Company as one operating segment, which is the same as its reporting segment.\n\n \n\nq)\n\nRecent Accounting Pronouncements\n\n \n\nIn December 2023, the FASB issued ASU 2023-09, “\n\nImprovements to Income Tax Disclosure\n\n”, which enhances the transparency and decision usefulness of income tax disclosures. The standard is effective for public companies for annual periods beginning after December 15, 2024. Early adoption is available. The Company adopted ASU 2023-09 during the year ended February 28, 2026, and the adoption had no material impact on the Company’s financial statements.\n\n \n\n \n\nF-11\n\n \n\n \n\nIn November 2024, the FASB issued ASU 2024-03, “\n\nIncome Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses”\n\n(“ASU 2024-03”). This ASU requires disclosures about specific types of expenses included in the expense captions presented on the face of the statement of operation as well as disclosures about selling expenses. The standard is effective for annual reporting periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027. The requirements will be applied prospectively with the option for retrospective application. Early adoption is permitted. The Company will evaluate the full extent of the potential impact of the adoption of ASU 2024-03.\n\n \n\nIn December 2025, the FASB issued ASU 2025-12, “\n\nCodification Improvements”\n\n(“ASU 2025-12\"). ASU 2025-12 addresses suggestions received from stakeholders regarding the Accounting Standards Codification and makes other incremental improvements to U.S. GAAP. The update represents changes to the Codification that clarify, correct errors in or make other improvements to a variety of topics that are intended to make it easier to understand and apply. ASU 2025-12 is effective for fiscal years beginning after December 15, 2026 and interim periods within those fiscal years. Entities are required to apply the amendments to ASC 260 retrospectively. All other amendments may be applied prospectively or retrospectively. Early adoption is permitted. The Company is still evaluating the full extent of the potential impact of the adoption of ASU 2025-12, but believes it will not have a material impact on its consolidated financial statements and disclosures.\n\n \n\nIn December 2025, the FASB issued ASU 2025-11, “\n\nInterim Reporting (Topic 270): Narrow-Scope Improvements\n\n” (\"ASU 2025-11\"). ASU 2025-11 is intended to improve the navigability of guidance in ASC 270, Interim Reporting, and clarify when it applies. The amendments also provide additional guidance on what disclosures should be provided in interim reporting periods. ASU 2025-11 is effective for fiscal years beginning after December 15, 2027, including interim periods within those fiscal years, and permits prospective or full retrospective adoption. The Company is still evaluating the full extent of the potential impact of the adoption of ASU 2025-11, but believes it will not have a material impact on its consolidated financial statements and disclosures.\n\n \n\nThe Company has implemented all new accounting pronouncements that are in effect and that may impact its consolidated financial statements and does not believe that there are\nany\nother new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.\n\n \n\n3.\n\nProperty and Equipment, Net\n\n \n\nProperty and equipment, net, consists of the following:\n\n \n\n \n\n \n\nCost\n\n \n\n \n\nAccumulated\n\nDepreciation\n\n \n\n \n\n \n\n \n\nFebruary 28,\n\n2026\n\nNet Carrying\n\nValue\n\n \n\n \n\n \n\n \n\n \n\n \n\nFebruary 28,\n\n2025\n\nNet Carrying\n\nValue\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nComputer equipment\n\n \n\n$\n\n17,010\n\n \n\n \n\n$\n\n(15,904\n\n)\n\n \n\n$\n\n1,106\n\n \n\n \n\n$\n\n1,912\n\n \n\nComputer software\n\n \n\n \n\n206,000\n\n \n\n \n\n \n\n(206,000\n\n)\n\n \n\n \n\n–\n\n \n\n \n\n \n\n5\n\n \n\nFurniture and fixtures\n\n \n\n \n\n12,787\n\n \n\n \n\n \n\n(10,531\n\n)\n\n \n\n \n\n2,256\n\n \n\n \n\n \n\n1,548\n\n \n\nMotor vehicle\n\n \n\n \n\n22,651\n\n \n\n \n\n \n\n(13,074\n\n)\n\n \n\n \n\n9,577\n\n \n\n \n\n \n\n12,114\n\n \n\nOffice equipment\n\n \n\n \n\n4,976\n\n \n\n \n\n \n\n(4,867\n\n)\n\n \n\n \n\n109\n\n \n\n \n\n \n\n333\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nTotal\n\n \n\n$\n\n263,424\n\n \n\n \n\n$\n\n(250,376\n\n)\n\n \n\n$\n\n13,048\n\n \n\n \n\n$\n\n15,912\n\n \n\n \n\nDuring the year ended February 28, 2026, the Company recorded depreciation expense of $6,917 (2025\n\n–\n\n$7,650). During the year ended February 28, 2026, the Company acquired $842 (2025\n\n–\n\n$nil) of computer equipment and $1,151 (2025\n\n–\n\n$nil) of furniture and fixtures.\n\n \n\n4.\n\nRight-Of-Use Assets, Net\n\n \n\nRight-of-use assets, net, consist of the following:\n\n \n\n \n\n \n\nCost\n\n \n\n \n\nAccumulated\n\nAmortization\n\n \n\n \n\nFebruary 28,\n\n2026\n\nNet Carrying\n\nValue\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nFebruary 28,\n\n2025\n\nNet Carrying\n\nValue\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nRight-of-use building (operating lease)\n\n \n\n$\n\n61,038\n\n \n\n \n\n$\n\n(12,872\n\n)\n\n \n\n$\n\n48,166\n\n \n\n \n\n$\n\n59,716\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nTotal\n\n \n\n$\n\n61,038\n\n \n\n \n\n$\n\n(12,872\n\n)\n\n \n\n$\n\n48,166\n\n \n\n \n\n$\n\n59,716\n\n \n\n \n\nDuring the year ended February 28, 2026, the Company recorded rent expense of $24,054 (2025 - $21,698) related to Company’s right-of-use building.\n\n \n\n \n\nF-12\n\n \n\n \n\n5.\n\nDue to Related Parties\n\n \n\na)\n\nOn March 24, 2021, the Company entered into a promissory note with the Chief Executive Officer (\n\n“\n\nCEO\n\n”\n\n) of the Company for $10,000, which is unsecured, bears interest of 10% per annum and matured on March 24, 2022. As at February 28, 2026, the outstanding principal is $10,000 (2025\n\n–\n\n$10,000) and the Company has recognized accrued interest of $4,937 (2025\n\n–\n\n$3,937), which is included in due to related parties.\n\n \n\nb)\n\nOn September 7, 2021, the Company entered into a promissory note with the CEO of the Company for $10,000, which is unsecured, bears interest of 10% per annum and matured on March 7, 2022. As at February 28, 2026, the outstanding principal is $10,000 (2025\n\n–\n\n$10,000) and the Company has recognized accrued interest of $4,479 (2025\n\n–\n\n$3,479) which is included in due to related parties.\n\n \n\nc)\n\nOn February 11, 2022, the Company entered into a promissory note with the CEO of the Company for $20,000, which is unsecured, bears interest of 10% per annum and matured on February 11, 2023. As at February 28, 2026, the outstanding principal is $20,000 (2025\n\n–\n\n$20,000) and the Company has recognized accrued interest of $8,099 (2025\n\n–\n\n$6,099), which is included in due to related parties.\n\n \n\nd)\n\nOn April 14, 2021, the Company entered into a promissory note with a company controlled by a significant shareholder of the Company for $26,000, which is unsecured, bears interest of 10% per annum and matured on October 13, 2023. As at February 28, 2026, the outstanding principal is $nil (2025\n\n–\n\n$26,000) and the Company has recognized accrued interest of $nil (2025\n\n–\n\n$10,087), which is included in due to related parties. On October 17, 2025, the Company issued 140,007 shares of common stock with a fair value of $196,010 to settle the outstanding principal of $26,000 and accrued interest of $11,732, resulting in a loss on settlement of debt of $158,278 (Note 8(b).\n\n \n\ne)\n\nOn February 11, 2022, the Company entered into a promissory note with a company controlled by a significant shareholder of the Company for $130,000, which is unsecured, bears interest of 10% per annum and matures on February 11, 2023. As at February 28, 2026, the outstanding principal is $nil (2025\n\n–\n\n$130,000) and the Company has recognized accrued interest of $nil (2025\n\n–\n\n$39,641), which is included in due to related parties. On October 17, 2025, the Company issued 659,993 shares of common stock with a fair value of $923,990 to settle the outstanding principal of $130,000 and accrued interest of $47,868, resulting in a loss on settlement of debt of $746,122 (Note 8(b)\n\n \n\nf)\n\nDuring the year ended February 28, 2022, a third-party lender purchased a promissory note from a company controlled by a significant shareholder of the Company in the amount of $15,000, which is unsecured, bears interest of 10% per annum and matured on October 13, 2023. As at February 28, 2026, the outstanding principal is $15,000 (2025\n\n–\n\n$15,000) and the Company has recognized accrued interest of $7,319 (2025\n\n–\n\n$5,819), which is included in due to related parties.\n\n \n\ng)\n\nOn May 2, 2022, the Company entered into a promissory note with a company controlled by a significant shareholder of the Company for $25,000, which is unsecured, bears interest of 10% per annum and matured on March 2, 2023. As at February 28, 2026, the outstanding principal is $25,000 (2025\n\n–\n\n$25,000) and the Company has recognized accrued interest of $9,575 (2025\n\n–\n\n$7,075), which is included in due to related parties.\n\n \n\nh)\n\nOn September 9, 2022, the Company entered into a promissory note with a company controlled by a significant shareholder of the Company for $15,000, which is unsecured, bears interest of 10% per annum and matured on September 9, 2023. As at February 28, 2026, the outstanding principal is $15,000 (2025\n\n–\n\n$15,000) and the Company has recognized accrued interest of $5,211 (2025\n\n–\n\n$3,711), which is included in due to related parties.\n\n \n\ni)\n\nOn January 31, 2025, the Company entered into a promissory note with a company controlled by a significant shareholder of the Company for $50,000, which is unsecured, bears interest of 10% per annum and matured on January 31, 2027. As at February 28, 2026, the outstanding principal is $50,000 (2025 - $50,000) and the Company has recognized accrued interest of $5,383 (2025 - $383), which is included in due to related parties.\n\n \n\nj)\n\nOn March 3, 2025, the Company entered into a promissory note with a company controlled by a significant shareholder of the Company for $50,000, which is unsecured, bears interest of 10% per annum and matures on March 3, 2027. As at February 28, 2026, the outstanding principal is $50,000 and the Company has recognized accrued interest of $4,959, which is included in due to related parties.\n\n \n\nk)\n\nOn May 9, 2025, the Company entered into a promissory note with a company controlled by a significant shareholder of the Company for $29,000, which is unsecured, bears interest of 10% per annum and matures on May 9, 2027. As at February 28, 2026, the outstanding principal is $29,000 and the Company has recognized accrued interest of $2,344, which is included in due to related parties.\n\n \n\nl)\n\nOn May 22, 2025, the Company entered into a promissory note with a company controlled by a significant shareholder of the Company for $41,000, which is unsecured, bears interest of 10% per annum and matures on May 22, 2027. As at February 28, 2026, the outstanding principal is $41,000 and the Company has recognized accrued interest of $3,168, which is included in due to related parties.\n\n \n\n \n\nF-13\n\n \n\n \n\nm)\n\nOn July 23, 2025, the Company entered into a promissory note with a company controlled by a significant shareholder of the Company for $50,000, which is unsecured, bears interest of 10% per annum and matures on July 23, 2027. As at February 28, 2026, the outstanding principal is $50,000 and the Company has recognized accrued interest of $3,014, which is included in due to related parties.\n\n \n\nn)\n\nOn September 12, 2025, the Company entered into a promissory note with a company controlled by a significant shareholder of the Company for $50,000, which is unsecured, bears interest of 10% per annum and matures on September 12, 2027. As at February 28, 2026, the outstanding principal is $50,000 and the Company has recognized accrued interest of $2,315, which is included in due to related parties.\n\n \n\no)\n\nAs at February 28, 2026, the Company owes a total of $681 (2025\n\n–\n\n$600) to officers of the Company for advances, which are unsecured, non-interest bearing and due on demand.\n\n \n\np)\n\nDuring the year ended February 28, 2026, the Company incurred salary expenses of $114,294 (R1,992,741) (2025\n\n–\n\n$108,028 (R1,973,032) to the CEO of the Company.\n\n \n\nq)\n\nDuring the year ended February 28, 2026, the Company incurred directors\n\n’\n\nfees of $67,000 (2025\n\n–\n\n$91,875) to a Director of the Company pursuant to a Director Agreement (Note 10(a).\n\n \n\nr)\n\nDuring the year ended February 28, 2026, the Company incurred directors\n\n’\n\nfees of $5,162 (R90,000) (2025\n\n–\n\n$4,928 (R90,000) to a Director of the Company.\n\n \n\ns)\n\nDuring the year ended February 28, 2026, the Company incurred director fees of $70,000 (2025 - $70,000) to the Director and former Chief Operating Officer (\n\n“\n\nCOO\n\n”\n\n) of the Company pursuant to a Director and Officer Agreement (Note 10(b).\n\n \n\n6.\n\nNotes Payable\n\n \n\na)\n\nOn May 20, 2020, the Company entered into a promissory note with a third-party lender for $25,000, which is unsecured, bears interest of 10% per annum and matured on May 20, 2023. As at February 28, 2026, the Company has recognized accrued interest of $14,452 (2025\n\n–\n\n$\n\n11,952), which is included in accounts payable and accrued liabilities.\n\n \n\nb)\n\nOn May 27, 2020, the Company entered into a promissory note with the U.S. Small Business Administration for $77,800, which is secured by the assets of the Company, bears interest of 3.75% per annum and matures on May 27, 2050. Instalment payments, including principal and interest, of $380 per month will begin 12 months from the date of the promissory note. As at February 28, 2026, the Company has recognized accrued interest of $16,030 (2025\n\n–\n\n$13,112), which is included in accounts payable and accrued liabilities.\n\n \n\nc)\n\nOn October 22, 2021, the Company entered into a promissory note with a third-party lender for $25,500, which is unsecured, bears interest of 10% per annum and matured on October 13, 2023. As at February 28, 2026, the Company has recognized accrued interest of $11,108\n\n(2025\n\n–\n\n$8,558), which is\n\nincluded in accounts payable and accrued liabilities.\n\n \n\n7.\n\nLease Liabilities\n\n \n\nOn February 1, 2025, the Company entered a one-year lease with a two-year renewal option for office space in South Africa. Rental payments are due at the beginning of each month and increase at an annual escalation rate of 6%. On January 19, 2026, the Company entered into an amendment to the original lease which amended the annual escalation rate to 4%. The base monthly rental rate is $2,078 (R36,225). The interest rate underlying the obligation in the lease was 11% per annum.\n\n \n\nThe following is a schedule by years of future minimum lease payments under the remaining finance leases together with the present value of the net minimum lease payments as of February 28, 2026:\n\n \n\nYears ending February 28:\n\n \n\nBuilding Lease\n\n(Operating Lease)\n\n \n\n \n\n \n\n \n\n \n\n \n\n2027\n\n \n\n$\n\n27,534\n\n \n\n2028\n\n \n\n \n\n26,171\n\n \n\n \n\n \n\n \n\n \n\n \n\nNet minimum lease payments\n\n \n\n \n\n53,705\n\n \n\nLess: amount representing interest payments\n\n \n\n \n\n(5,539\n\n)\n\n \n\n \n\n \n\n \n\n \n\nPresent value of net minimum lease payments\n\n \n\n \n\n48,166\n\n \n\nLess: current portion\n\n \n\n \n\n(23,383\n\n)\n\n \n\n \n\n \n\n \n\n \n\nLong-term portion\n\n \n\n$\n\n24,783\n\n \n\n \n\n \n\nF-14\n\n \n\n \n\n8.\n\nCommon Stock\n\n \n\nShare transactions for the year ended February 28, 2026:\n\na)\n\nOn October 8, 2025, the Company issued 100,000 shares of common stock for proceeds of $50,000.\n\n \n\nb)\n\nOn November 11, 2025, the Company issued 800,000 shares of common stock with a fair value of $1,120,000 to settle notes payable to related parties and accrued interest totaling $215,600, resulting in a loss on settlement of debt of $904,400.\n\n \n\nc)\n\nOn February 24, 2026, the Company issued 100,000 shares of common stock for proceeds of $50,000.\n\n \n\nd)\n\nDuring the year ended February 28, 2026, the Company accrued 200,000 shares of common stock issuable with a fair value of $137,000 pursuant to Director Agreements (Note 10(a) and Note 10(b).\n\n \n\nShare transactions for the year ended February 28, 2025:\n\n \n\na)\n\nOn June 13, 2024, the Company issued 220,000 shares of common stock with a fair value of $147,400 to the acquire the remaining 49% non-controlling interest in Huntpal LLC\n\n. At the date of acquisition, the carrying value of the non-controlling interest was $nil, resulting in a loss of $147,180 which was offset against additional paid-in capital.\n\n \n\nb)\n\nOn July 22, 2024, the Company issued 200,000 shares of common stock for proceeds of $100,000.\n\n \n\nc)\n\nOn September 6, 2024, the Company issued 100,000 shares of common stock with a fair value of $67,000 for legal services, which vest on September 6, 2025. The fair value was recorded of the shares of common stock will be amortized over the 12-month vesting period. The issuance is also subject to a 5-year service condition, for which the shares of common stock will be clawed back on a pro-rated basis for any portion of the service term not provided. During the year ended February 28, 2025, the Company recognized legal fees of $27,917 related to this issuance. As at February 28, 2025, the Company has recognized $39,083 in prepaid expenses and other current assets.\n\n \n\nd)\n\nOn February 26, 2025, the Company issued a total of 250,000 shares of common stock with a fair value of $250,000 to the former COO and director of the Company for services pursuant to a Director Agreement and Officer Agreement (Note 10(b).\n\n \n\ne)\n\nOn February 26, 2025, the Company issued 116,667 shares of common stock with a fair value of $113,334 to a director of the Company pursuant to a Director Agreement (Note 10(a).\n\n \n\nf)\n\nDuring the year ended February 28, 2025,\n\nthe Company accrued $111,875 of common stock issuable for 162,500 common stock pursuant to Director Agreements (Note 10(a) and Note 10(b).\n\n \n\n9.\n\n   \n\nConcentrations\n\n \n\nThe Company\n\n’\n\ns revenues were concentrated among two customers for the year ended February 28, 2026 and 2025.\n\n \n\nCustomer\n\n \n\nYear\n\nEnded\n\nFebruary 28, 2026\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n1\n\n \n\n \n\n24\n\n%\n\n2\n\n \n\n \n\n9\n\n%\n\n \n\nCustomer\n\n \n\nYear\n\nEnded\n\nFebruary 28, 2025\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n1\n\n \n\n \n\n23\n\n%\n\n2\n\n \n\n \n\n12\n\n%\n\n \n\nThe Company\n\n’\n\ns receivables were concentrated among two customers as at February 28, 2026, and three customers as at February 28, 2025:\n\n \n\nCustomer\n\n \n\nFebruary 28,\n\n2026\n\n \n\n \n\n \n\n \n\n \n\n \n\n1\n\n \n\n \n\n26\n\n%\n\n2\n\n \n\n \n\n13\n\n%\n\n \n\nCustomer\n\n \n\nFebruary 28,\n\n2025\n\n \n\n \n\n \n\n \n\n \n\n \n\n1\n\n \n\n \n\n27\n\n%\n\n2\n\n \n\n \n\n20\n\n%\n\n3\n\n \n\n \n\n18\n\n%\n\n \n\n \n\nF-15\n\n \n\n \n\n10.\n\nCommitments and Contingencies\n\n \n\na)\n\nOn September 1, 2022, the Company entered into an agreement with a Director of the Company for a term of 12 months. In consideration for the services to be provided, the Company agreed to pay the Director 100,000 restricted shares of common stock that will vest bi-monthly over the 12 months. During the year ended February 28, 2023, the Company recognized board member compensation of $40,000, representing the fair value of 50,000 shares of common stock issuable for services rendered for the period from September 2022 to February 2023. During the year ended February 28, 2023, the Company issued 33,333 of the 50,000 shares issuable, leaving a balance of 16,667 shares still issuable at February 28, 2023. During the year ended\n\nFebruary 29, 2024\n\n, the Company recognized board member compensation of $40,000, representing the fair value of 50,000 shares of common stock issuable for services rendered for the period from March 2023 to August 2023. During the year ended\n\nFebruary 29, 2024\n\n, another 50,000 shares were issued.\n\n \n\nOn August 16, 2023, the Company extended its agreement with the Director for a new term of 12 months, effective September 1, 2023. In consideration of services to be rendered, the Company shall pay the director 100,000 restricted shares of common stock, of which 50,000 shares will vest every\n6 months\nover the term. Pursuant to the terms of the extended agreement, the Company recognized board member compensation of $50,000, representing a fair value of 50,000 shares of common stock issuable for services rendered for the period from March 2024 to August 2024. On February 26, 2025, the Company issued the 50,000 shares of common stock issuable.\n\n \n\nOn September 1, 2024, the Company extended its agreement with the Director for a new term of 24 months, effective September 1, 2024. In consideration of services to be rendered, the Company shall pay the director 200,000 restricted shares of common stock, of which 100,000 shares will vest every\n12 months\nover the term. Pursuant to the terms of the extended agreement, the Company recognized board member compensation of $33,500, representing a fair value of 50,000 shares of common stock issuable for services rendered for the period from September 2024 to February 2025. Pursuant to the terms of the extended agreement, the Company recognized board member compensation of $67,000, representing a fair value of 100,000 shares of common stock issuable for services rendered for the period from March 2025 to February 2026.\n\n \n\nAs at\n\nFebruary 28, 2026\n\n, a total of 150,000 shares (2025\n\n–\n\n50,000 shares) of common stock remain issuable to the director.\n\n \n\nb)\n\nOn March 1, 2023, the Company entered into agreements with a Director and COO of the Company for director services and management services for a term of\n12 months\nand\n3 years\n, respectively. In consideration for the services to be provided as a director, the Company agreed to pay the Officer and Director 100,000 restricted shares of common stock that will vest bi-monthly over the 12 months. In consideration for the services to be provided as the COO, the Company also agreed to pay the Officer and Director an additional 700,000 shares of common stock that will vest quarterly with 12 equal payments of 58,333 shares. During the year ended February 29, 2024, the Company recognized management fees of $233,330 and board member compensation of $100,000, representing the fair value of 333,330 shares of common stock issuable for services rendered for the period from March 2023 to February 2024. The Company did not renew the Officer Agreement and on February 26, 2025, issued 250,000 shares of common stock with a fair value of $250,000.\n\n \n\nOn March 1, 2024, the Company extended its agreement with the Director for a new term of 30 months, effective March 1, 2024. In consideration of services to be rendered, the Company shall pay the director 250,000 restricted shares of common stock, of which 100,000 shares will vest on or about September 1, 2025, with the remaining 150,000 shares vesting on or about September 1, 2026. Pursuant to the terms of the extended agreement, the Company recognized board member compensation of $70,000 representing a fair value of 100,000 shares of common stock issuable for services rendered for the period from March 2024 to February 2025. Pursuant to the terms of the extended agreement, the Company recognized board member compensation of $70,000 representing a fair value of 100,000 shares of common stock issuable for services rendered for the period from March 2025 to February 2026.\n\n \n\nAs at February 28, 2026, a total of 200,000 (2025\n\n–\n\n100,000 shares) shares of common stock remain issuable to the officer and director.\n\n \n\n11.\n\n   \n\nDeposit\n\n \n\nOn October 15, 2021, the Company paid a R800,000 deposit to set up an electronic funds transfer debit facility with a vendor, which does not\nrequire\na physical facility. During the year ended February 29, 2024, R600,000 of the deposit was returned to the Company. As at February 28, 2026, the balance of the deposit was $12,584 (R200,000) (2025\n\n–\n\n$10,807 (R200,000). The deposit will remain for as long as the Company uses the facility.\n\n \n\n \n\nF-16\n\n \n\n \n\n12.\n\nIncome Taxes\n\n \n\nThe potential benefit of net operating losses for the Company have not been recognized in the consolidated financial statements because the Company cannot be assured that it is more likely than not that it will utilize the net operating losses carried forward in future years. The Company did not incur any income tax expense to the Internal Revenue Services for the years ended February 28, 2026 and 2025. Rent Pay incurred an income tax expense of $nil for the year ended February 28, 2026 (2025 – $nil). Given the short history of the Company and the uncertainty as to the likelihood of future taxable income, the Company has recorded a 100% valuation reserve against the anticipated recovery from the use of the net operating losses. The Company will evaluate the appropriateness of the valuation allowance on an annual basis and adjust the allowance as considered necessary. The Company’s US net operating loss is approximately $1,392,000 (2025 – $1,210,000) at February 28, 2026, which starts to expire in 2037.\n\n \n\nThe table below reconciles the US federal income tax rate to the effective rate for the years ended February 28, 2026 and 2025.\n\n \n\nIncome Tax at Statutory Rate\n\n \n\n \n\n(21\n\n)%\n\nEffect of Operating Losses\n\n \n\n \n\n21\n\n%\n\nForeign Income Tax\n\n \n\n \n\n18\n\n%\n\n \n\n \n\n \n\n18\n\n%\n\n \n\nA reconciliation of the Company’s effective tax rate as a percentage of income before taxes and federal statutory rate for the years ended February 28, 2026 and 2025, is summarized as follows:\n\n \n\n \n\n \n\n2026\n\n$\n\n \n\n \n\n \n\n \n\n2025\n\n$\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nLoss before income taxes\n\n \n\n \n\n(1,406,623\n\n)\n\n \n\n \n\n(540,062\n\n)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nIncome tax recovery at statutory rates\n\n \n\n \n\n(295,000\n\n)\n\n \n\n \n\n(114,000\n\n)\n\nPermanent differences\n\n \n\n \n\n190,000\n\n \n\n \n\n \n\n–\n\n \n\nTemporary differences\n\n \n\n \n\n1,000\n\n \n\n \n\n \n\n2,000\n\n \n\nChange in statutory, foreign tax, foreign exchange rates and other\n\n \n\n \n\n104,000\n\n \n\n \n\n \n\n112,000\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nIncome tax expenses\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\nThe unrecognized deferred tax assets include US net operating losses as follows:\n\n \n\n \n\n \n\n2026\n\n$\n\n \n\n \n\n \n\n \n\n2025\n\n$\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nDeferred tax assets:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nNon-capital losses available for future periods\n\n \n\n \n\n292,000\n\n \n\n \n\n \n\n254,000\n\n \n\nValuation allowance\n\n \n\n \n\n(292,000\n\n)\n\n \n\n \n\n(254,000\n\n)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nDeferred income taxes recovered\n\n \n\n \n\n–\n\n \n\n \n\n \n\n–\n\n \n\n \n\nThe Company has US net operating losses available to offset future taxable income as follows:\n\n \n\n2016\n\n \n\n$\n\n35,000\n\n \n\n2017\n\n \n\n \n\n78,000\n\n \n\n2018\n\n \n\n \n\n71,000\n\n \n\n2019\n\n \n\n \n\n6,000\n\n \n\n2020\n\n \n\n \n\n5,000\n\n \n\n2021\n\n \n\n \n\n130,000\n\n \n\n2022\n\n \n\n \n\n431,000\n\n \n\n2023\n\n \n\n \n\n109,000\n\n \n\n2024\n\n \n\n \n\n135,000\n\n \n\n2025\n\n \n\n \n\n210,000\n\n \n\n2026\n\n \n\n \n\n182,000\n\n \n\n \n\n \n\n$\n\n1,392,000\n\n \n\n \n\n13.\n\nSubsequent Event\n\n \n\nManagement has evaluated subsequent events through the date that these financial statements were issued, and none were identified.\n\n \n\n \n\nF-17"}