STME 10-K & 10-Q changes, risk factors and insider trading

In December 2023, the Company issued 15,454,221 shares of its common stock on conversion of a total of $1,622,693 in then current liabilities. The conversion resulted in a decrease in the Company’s working capital deficit. To further reduce the Company’s liabilities and improve its financial position, the Company may continue to convert its debt into shares of common stock. The issuance of additional stock increases the total number of shares issued and outstanding, resulting in a decrease in the percentage of interest held by each of the Company’s shareholders, thereby further diluting their position.

·Research and development fees for the year ended May 31, 2025,2026, increased by $86,548,$145,167, or 384.0%,226.8%, from a recapture of $22,539 incurred during the year ended May 31, 2024, to $64,009 the Company incurred during the year ended May 31, 2025.2025, to $209,176 the Company incurred during the current year ended May 31, 2026. The increase in research and development fees during the current year ended May 31, 2025, waswere associated with the Company’s decision to redesign the eBalance® Home device into a compact, affordable consumer unit optimized for home use, which resulted in an engagement of ADM Tronics Unlimited, Inc.,Inc. aManagement leaderexpects elevated research and development expenditures to continue in electronic medical device engineering, who started working on the projectnear interm February of 2025. During the comparative year ended May 31, 2024, theas development of the eBalance® devices was suspended due to a lack of funding and unfavorable financial position.progresses.

During the comparative year ended May 31, 2025, the Company entered into a debt settlement agreement to convert $15,000 into shares of common stock at a price of $0.20 per share for an aggregate of 75,000 shares of common stock. The Company recognized $7,500 loss on conversion of debt. This loss was in part offset by $1,569 debt forgiveness associated with the amounts due to certain vendors which exceeded the statute of limitations. The Company did not have similar transactions in the year ended May 31, 2026.

The Company did not generate sufficient cash flows from its operating activities to satisfy its cash requirements for the year ended May 31, 2025.2026. The amount of cash generated from the operations to date is significantly less than the Company’s current debt obligations. There is no assurance that the Company will be able to generate sufficient cash from operations to repay the amounts owing under the outstanding notes and advances payable, or to service other debt obligations. If the Company is unable to generate sufficient cash flow from operations to repay the amounts owing when due, it may be required to raise additional financing from other sources. The outcome of these matters cannot be predicted with any certainty at this time and raises substantial doubt that the Company will be able to continue as a going concern.

·The Company incurred $266,444 (May 31, 2025 - $107,750) in investor relations activities, which were paid for through the issuance of common shares;

·$6,741$6,053 (May 31, 20242025 - $11,724$6,741) in interest accrued on the vendor payables; and

As at May 31, 2025,2026, the Company had accumulated a deficit of $10,861,556$11,756,931 since inceptioninception, and additional funding will be required to support the operations. The Company’s continuation as a going concern depends upon the continued financial support of its shareholders, its ability to obtain necessary debt or equity financing to continue operations, and the attainment of profitable operations. The consolidated financial statements for the year ended May 31, 2025,2026, do not give effect to any adjustments that would be necessary should the Company be unable to continue as a going concern and therefore be required to realize its assets and discharge its liabilities in other than the normal course of business and at amounts different from those reflected in the Company’s financial statements.

Effective November 1, 2024, the Company completed a 1-for-15 reverse split (the “Reverse Split”) of its common stock. As a result of the Reverse Split, the Company’s authorized capital was decreased from 7,500,000,000 shares of common stock with par value of $0.001, of which 297,236,373 shares were outstanding immediately prior to the Reverse Split, to 500,000,000 shares of common stock with par value of $0.001, of which 19,816,272 were outstanding. All share and per-share amounts in this Quarterly Report on Form 10-Q have been retrospectively adjusted.

Concurrent with the Reverse Split, the Company amended its articles of incorporation to change the Company’s name from “Cell MedX Corp.” to “Stimcell Energetics Inc.” (the “Name Change”).

Stimcell Energetics Inc. is a biotech company focused on the discovery, development and commercialization of therapeutic and non-therapeutic products that promote general health, anti-aging, pain relief, wellness and alleviate complications associated with medical conditions including, but not limited to: diabetes, insulin resistance, high blood pressure, neuropathy and kidney function. CellThe MedX (Canada)Company is engaged in development and manufacturing of therapeutic devices based on the proprietary eBalance® Technology, which harnesses the power of microcurrents and their effects on the human body.

Under the agreement, Dr. Fernyhough'sFernyhough’s team will conduct a series of experiments to assess how eBalance® stimulation influences key aspects of cellular energy production by mitochondria. Using established biological assays in Dr. Fernyhough'sFernyhough’s laboratory, the study will measure oxygen consumption rates (OCR) to evaluate impacts on the electron transport chain, ATP production, glycolysis, basal respiration, maximal respiration, spare respiratory capacity, coupling efficiency, and proton leak. Additional analyses will quantify enzyme activities such as AMP-activated protein kinase (AMPK) and levels of respiratory proteins through Western blotting. The project, expected to span approximately three months, involves acute and longer-term stimulation of dissociated adult rat dorsal root ganglia (DRG) neurons under controlled conditions. Replicates will ensure robust statistical analysis, with a comprehensive report provided at the study'sstudy’s conclusion. The study is expected to commence in mid-April.

Results of Operations for the Three and SixNine Months ended NovemberFebruary 30,28, 20252026 and 20242025

Operating results for the three and sixnine months ended NovemberFebruary 30,28, 20252026 and 2024,2025, and the changes in the operating results between those periods are summarized in the table below.

The Company did not have any revenue-generating activities during the three and sixnine months ended NovemberFebruary 30,28, 20252026 and 2024.2025.

During the three months ended NovemberFebruary 30,28, 2025,2026, the Company’s operating expenses increaseddecreased by 124.2%45.1% from $130,698$131,086 the Company incurred during the three months ended NovemberFebruary 30,28, 2024,2025, to $293,046$71,908 incurred during the three months ended NovemberFebruary 30,28, 2025.2026. The largest change was associated with a $140,917$71,698 increasedecrease in foreign exchange loss, driven by a weakening Canadian dollar relative to the U.S. dollar. As of February 28, 2026, the Company recognized a foreign exchange gain of $30,146, compared with $41,552 foreign exchange loss during the same period in 2025. The Company’s general and administrative expenses,expenses which increaseddecreased from $22,681 the Company incurred$32,847 during the three months ending NovemberFebruary 30,28, 2024,2025, to $163,598$8,208 duringin the three months ending NovemberFebruary 30,28, 2025.2026. The mainprimary driver of this change was a $134,362$17,334 increasereduction in corporate communications, which rose to $135,137 inas the currentCompany periodhad fromno $775expenditures inon corporate communications during the samethree periodmonths lastended year.February 28, 2026. Other notable changes included a $10,560$10,995 increasedecline in regulatory fees, leading to a recapture of $2,996 (February 28, 2025 - $7,999), and a $1,990 decrease in audit and accounting fees to $17,678$6,000 (NovemberFebruary 30,28, 20242025 - $7,118$7,990),. These decreases were partly offset by a $2,008$3,944 increase in office expenses to $2,861$4,775 (NovemberFebruary 30,28, 20242025 - $853$4,775), and $1,330 in travel expenses, an expense the Company did not incur in the comparative period. These increases were partly offset by a $7,224$1,208 decreaserise in professional fees, from $7,469 during the comparative periodfees to $245$157 during(February the28, current2025 period- endedrecapture Novemberof 30, 2025.$1,051). All other expenses included in general and administrative fees remained relatively stable.

·The Companyreduction incurredin $108,344operating expenses was partly offset by a $36,068 increase in research and development fees for the sixthree months ended NovemberFebruary 30,28, 2025.2026. The research and development fees during the current period were associated with the Company’s decision to redesign the eBalance® Home device into a compact, affordable consumer unit optimized for home use, which resulted in an engagement of ADM Tronics Unlimited, Inc. During the comparative sixthree months ended NovemberFebruary 30,28, 2024,2025, the developmentcompany ofincurred the$493 eBalance® devices was suspended due to a lack of funding and unfavorable financial position, and therefore the Company had no expenses associated within research and development.

Along with the changes in operating expenses mentioned above, the Company also incurred $45,000 ina management feesfee andof $69,165 in consulting fees,$22,500, which remained consistentunchanged withcompared to the amountsprior period, and consulting fees of $34,785, representing an increase of $1,091 from $33,694 incurred in the Companycomparative incurredperiod forending theFebruary six28, months ended November 30, 2024.2025.

During the three months ended NovemberFebruary 30,28, 2025,2026, the Company accrued $15,057$17,116 (NovemberFebruary 30,28, 20242025 - $7,233$7,917) in interest associated with outstanding notes payable to related parties and $1,645$1,542 (NovemberFebruary 30,28, 20242025 - $1,577$1,534) in interest accrued on other vendor payables.

During the sixnine months ended NovemberFebruary 30,28, 2025,2026, the Company accrued $27,035$44,150 (NovemberFebruary 30,28, 20242025 - $14,239$22,156) in interest on outstanding notes payable to related parties and $2,915$4,458 (NovemberFebruary 30,28, 20242025 - $3,423$4,958) in interest on other vendor payables. During the sixnine months ended NovemberFebruary 30,28, 2024,2025, the Company discharged an outstanding debt to its vendors due to the balances exceeding the statute of limitations, which resulted in a gain on forgiveness of debt of $1,569. The Company did not have similar transactions during the sixnine months ended NovemberFebruary 30,28, 2025.2026.

As of NovemberFebruary 30,28, 2025,2026, the Company had a cash balance of $46,159,$10,257, a working capital deficit of $1,542,294,$1,678,420, and cash flows used in operations of $182,280$268,570 for the period then ended. During the sixnine months ended NovemberFebruary 30,28, 2025,2026, the Company funded its operations with $214,248$264,248 the Company borrowed from its related parties under non-secured lines of credit at 10% annual interest compounded monthly and due on demand.

The Company did not generate sufficient cash flows from its operating activities to satisfy its cash requirements for the sixnine months ended NovemberFebruary 30,28, 2025.2026. The amount of cash generated from the operations to date is significantly less than the Company’s current debt obligations. A significant portion of the Company’s liabilities is owed to related parties, certain of which are in default. While these parties have historically provided ongoing financial support, there can be no assurance that such support will continue. There is no assurance that the Company will be able to generate sufficient cash from operations to repay the amounts owing under the outstanding notes and advances payable, or to service other debt obligations. If the Company is unable to generate sufficient cash flow from operations to repay the amounts owed when due, it may be required to raise additional financing from other sources. Based on current cash on hand and expected expenditures, the Company does not have sufficient liquidity to fund operations for the next twelve months without additional financing. Historically, the Company has relied significantly on financing from related parties and/or equity financing. The outcome of these matters cannot be predicted with any certainty at this time and raises substantial doubt that the Company will be able to continue as a going concern.

Net cash used in operating activities during the sixnine months ended NovemberFebruary 30,28, 2024,2026, was $39,436.$268,570. This cash was primarilymainly used to cover cash operating expenses of $154,293,$377,479, which were represented by a net loss of $206,427$665,916, reduced by the non-cash items totaling $52,134,$288,437, to decrease accrued liabilities by $15,699 and$19,175, to increase other current assets by $1,886.$17,635, and to decrease accounts payable by $7,311. These uses of cash were partly offset by a $104,081$153,030 increase in amounts due to related parties and a $28,361 increase in accounts payable.parties.

During the sixnine months ended NovemberFebruary 30,28, 2025,2026, net loss was affected by the following expenses that did not have any impact on cash used in operations:

·$250,000 (NovemberFebruary 30,28, 20242025 - $Nil) in investor relations activities, which were paid for through the issuance of common shares;

·$27,035$44,150 (NovemberFebruary 30,28, 20242025 - $14,239$22,156) in interest accrued on the outstanding notes due to related parties;

·$2,915$4,458 (NovemberFebruary 30,28, 20242025 - $3,423$4,958) in interest accrued on the vendor payables; and

·$19,477$10,171 in unrealized foreign exchange lossgain (NovemberFebruary 30,28, 20242025 - $36,041$76,746 loss), which resulted from fluctuations of the Canadian dollar, the functional currency of Cell MedX Canada, in relation to the U.S. dollar, the functional currency of the parent company, being also the Company’s reporting currency.

·During the comparative period ended NovemberFebruary 30,28, 2024,2025, the Company recognized a $1,569 gain on forgiveness of debt, which was associated with the write-off of debt that exceeded the statute of limitations.

During the sixnine months ended NovemberFebruary 30,28, 2025,2026, the Company borrowed $200,000 from Mr. Richard Jeffs, the Company’s major shareholder and the father of the Company’s CEO and President, Mr. David Jeffs, under a revolving credit line, which accumulates interest at 10% per annum compounded monthly and is due on demand. During the same period, the Company borrowed an additional $14,248$64,248 from Mrs. Susan Jeffs, the mother of the Company’s CEO and President, Mr. David Jeffs, under arevolving revolvingUS$ and CAD$ credit linelines that accruesaccrue interest at 10% per annum, compounded monthly, and isare due on demand.

The Company did not have any investing activities during the sixnine months ended NovemberFebruary 30,28, 20252026 and 2024.2025.

The notes to the Company’s unaudited condensed consolidated financial statements as at NovemberFebruary 30,28, 2025,2026, disclose an uncertain ability for the Company to continue as a going concern for the next twelve-month period. The Company’s current business operations are in an early development stage and as such, its ability to generate revenue from the operations is very minimal. The Company'sCompany’s research and development as well as marketing plans require large capital expenditures. Due to the financial difficulties the Company had faced, the research and development plans associated with the eBalance® technology were temporarily abandoned. In February 2025, the Company engaged ADM Tronics Unlimited, Inc., a leader in electronic medical device engineering, to redesign eBalance® microcurrent device, transforming it into a compact consumer unit, optimized for home use. Management is planningplans to support its operations as well asand the redesign of the eBalance® microcurrent device through equity or debt financing.

As at NovemberFebruary 30,28, 2025,2026, the Company had accumulated a deficit of $11,436,906$11,527,472 since inception and additional funding will be required to support the operations. The Company’s continuation as a going concern depends upon the continued financial support of its shareholders, its ability to obtain necessary debt or equity financing to continue operations, and the attainment of profitable operations. The unaudited condensed consolidated interim financial statements do not give effect to any adjustments that would be necessary should the Company be unable to continue as a going concern and therefore be required to realize its assets and discharge its liabilities in other than the normal course of business and at amounts different from those reflected in the Company’s financial statements.