PreAxia 10-K Reveals Going Concern, Material Weaknesses, and Massive Dilution
PAXH filed a Earnings and Guidance on light trading volume (0.1× avg).
Summary
PreAxia's annual report reveals a going concern warning, ineffective internal controls, 17 years of unfiled tax returns, and a 126% increase in shares outstanding driven by insider debt conversions and warrant exercises.
Key Events · Earnings and Guidance · PAXH
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Going Concern Warning
Auditor states substantial doubt about PreAxia's ability to continue as a going concern. Cash is $1,003 with a $966,177 working capital deficit and $1,161,471 net loss for fiscal 2026.
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Material Weaknesses and Unfiled Tax Returns
Management admits ineffective disclosure controls and internal control over financial reporting. The company failed to file corporate tax returns for 2008 through 2025.
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Auditor Turmoil
Three auditor changes in two years. Sadler, Gibb & Associates was asked to resign during onboarding after questioning prior period reporting; M&K CPAs engaged February 20, 2026.
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Massive Share Dilution
Shares outstanding rose from 19,767,698 to 44,714,782 (126% increase). CEO Tom Zapatinas received 15,255,770 shares for $1,525,577 in debt conversions; 7,400,000 warrants/options were exercised.
Analysis · PAXH · Trade & Services
This annual report confirms the company is in severe distress. The auditor states substantial doubt about PreAxia's ability to continue as a going concern, with only $1,003 in cash and a $966,177 working capital deficit. Management admits disclosure controls and internal controls are ineffective, and the company has failed to file corporate tax returns for 17 years. The share count exploded from 19.8 million to 44.7 million shares in one year — a 126% increase driven by debt conversions to the CEO, warrant exercises, and stock sales. Three different auditors have cycled through in the past two years, with the most recent predecessor resigning during onboarding after questioning prior period reporting. This is a distressed micro-cap where survival depends entirely on raising an estimated $1.8 million over the next twelve months through dilutive equity or debt.
How filings like this one have moved
In the 30 days to Sep 11, 2026, 41.8% of the 507 measured filings Wiseek scored 9 moved their stock by 5% or more by the next session's close. The median move was -0.39%. These are measured outcomes after filings of this importance, not a forecast for this one.
Measured one observation per ticker per day, after exclusions. Current figures: Filing Impact Tracker · open dataset
At the time of this filing, PAXH was trading at $0.22 on OTC in the Trade & Services sector, with a market capitalization of approximately $447.1K. The 52-week trading range was $0.01 to $2.50. This filing was assessed with negative market sentiment and an importance score of 9 out of 10.