# EDGAR Filing Document

**Accession Number:** 0001968304
**File Stem:** 0001665160-23-000517
**Filing Date:** 2023-3
**Character Count:** 89995
**Document Hash:** 8e56471fe9325c93dc51a9fd99a5d745
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001665160-23-000517.hdr.sgml**: 20230331

**ACCESSION NUMBER**: 0001665160-23-000517

**CONFORMED SUBMISSION TYPE**: C

**PUBLIC DOCUMENT COUNT**: 2

**FILED AS OF DATE**: 20230331

**DATE AS OF CHANGE**: 20230331

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Athelytix Inc.
- **CENTRAL INDEX KEY:** 0001968304
- **IRS NUMBER:** 815253002
- **STATE OF INCORPORATION:** DE
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** C
- **SEC ACT:** 1933 Act
- **SEC FILE NUMBER:** 020-32096
- **FILM NUMBER:** 23785087

**BUSINESS ADDRESS:**
- **STREET 1:** 10333 AVENIDA MAGNIFICA
- **CITY:** SAN DIEGO
- **STATE:** CA
- **ZIP:** 93121
- **BUSINESS PHONE:** (844) 439-3559

**MAIL ADDRESS:**
- **STREET 1:** 10333 AVENIDA MAGNIFICA
- **CITY:** SAN DIEGO
- **STATE:** CA
- **ZIP:** 93121

### Attached PDF Documents

**Attachment 1:** `offeringmemoformc.pdf`

## **Offering Memorandum: Part II of Offering Document (Exhibit A to Form C)**

Athelytix Inc.
10333 Avenida Magnifica
San Diego, CA 92131
https://athelytix.com/

Up to $1,234,998.80 in Class B Non Voting Common Stock at $2.54
Minimum Target Amount: $9,999.98

A crowdfunding investment involves risk. You should not invest any funds in this offering unless you can afford to lose your entire investment.

In making an investment decision, investors must rely on their own examination of the issuer and the terms of the offering, including the merits and risks involved. These securities have not been recommended or approved by any federal or state securities commission or regulatory authority. Furthermore, these authorities have not passed upon the accuracy or adequacy of this document.

The U.S. Securities and Exchange Commission does not pass upon the merits of any securities offered or the terms of the offering, nor does it pass upon the accuracy or completeness of any offering document or literature.

These securities are offered under an exemption from registration; however, the U.S. Securities and Exchange Commission has not made an independent determination that these securities are exempt from registration.

## Company:

Company: Athelytix Inc.

Address: 10333 Avenida Magnifica, San Diego, CA 92131

State of Incorporation: DE

Date Incorporated: January 31, 2017

## Terms:

### Equity

Offering Minimum: $9,999.98 | 3,937 shares of Class B Non Voting Common Stock

Offering Maximum: $1,234,998.80 | 486,220 shares of Class B Non Voting Common Stock

Type of Security Offered: Class B Non Voting Common Stock

Purchase Price of Security Offered: $2.54

Minimum Investment Amount (per investor): $254.00

*Maximum Number of Shares Offered subject to adjustment for bonus shares. See Bonus info below.*

### Investment Incentives and Bonuses*

#### TIME-BASED PERKS

Friends & Family: Invest within the first 72 hours and receive 15% bonus shares.

Super Early Bird Special: Invest within the next 72 hours and receive 10% bonus shares.

Early Bird Special: Invest within the next 7 days and receive 5% bonus shares.

#### VOLUME-BASED PERKS

Perk 1: Invest $1,017.42+ and receive 2% bonus shares.

Perk 2: Invest $2,543.56+ and receive 7% bonus shares.

Perk 3: Invest $6,358.90+ and receive 12% bonus shares.

Perk 4: Invest $12,717.79+ and receive 17% bonus shares.

*In order to receive perks from an investment, one must submit a single investment in the same offering that meets the minimum perk requirement. Bonus shares from perks will not be granted if an investor submits multiple investments that, when combined, meet the perk requirement. All perks occur when the offering is completed.*

### The 10% StartEngine Owners' Bonus

Athelytix, Inc. will offer 10% additional bonus shares for all investments that are

committed by investors that are eligible for the StartEngine Crowdfunding Inc. OWNers' bonus.

This means eligible StartEngine shareholders will receive a 10% bonus for any shares they purchase in this offering. For example, if you buy 100 shares of Class B Non Voting Common Stock at $2.54 / share, you will receive 110 shares of Class B Non Voting Common Stock, meaning you'll own 110 shares for $254. Fractional shares will not be distributed and share bonuses will be determined by rounding down to the nearest whole share.

This 10% Bonus is only valid during the investor's eligibility period. Investors eligible for this bonus will also have priority if they are on a waitlist to invest and the company surpasses its maximum funding goal. They will have the first opportunity to invest should room in the offering become available if prior investments are canceled or fail.

Investors will receive the highest single bonus they are eligible for among the bonuses based on the amount invested and time of offering elapsed (if any).

## The Company and its Business

### Company Overview

Athelytix, Inc. ('Athelytix' or the 'Company') is a corporation organized under the laws of the state of Delaware that produces laser based system to capture analytics for athletes, primarily baseball and softball, known as 'THE GRID'. 'THE GRID', targets baseball and softball training from youth to pro and links precise data from each 'event' (e.g. pitch, catch, and/or hit) with HD video to identify each player's optimal mechanics. The implementation of the Athelytix Grid is transacted as a revenue share with limited sales. This provides ever-increasing and ongoing revenue as more and more facilities obtain The GRID and will benefit the scalability of the product. Using lasers as a beam interrupt is the most accurate way to measure sports object data and is not influenced by the Doppler effect, or, Infrared requirements to eliminate ambient light. Athelytix' patent protects its rights for this game-changing technology.

The Company currently has a patent (USPTO Patent issued August 8, 2017, PATENT # 9,726,479 B2; 'System for Determining the Position, Speed or Trajectory of a Sports Object')

### Prior Business Bankruptcy

The Company's CEO and Board Chairman, Stephen Rosen, was involved in a bankruptcy proceeding while serving as CEO of a prior, unrelated company, named TV Magic, Inc. The Ch. 7 bankruptcy was filed in 2013 claiming over $4M in liabilities as a result of class action litigation over the employee/contractor status of several vendors used by TV Magic, Inc. Due to the cost of continuing to litigate the issue, TV Magic chose to cease operations and file its Ch. 7 petition, with the proceeding concluding in 2018.

# *Competitors and Industry*

# **Industry**

Analytics are transforming the world of sports and training by providing measurement data on all aspects of athletic performance. The worldwide sports analytics market is projected to grow to $12.6 Billion by 2029.

https://www.fortunebusinessinsights.com/sports-analytics-market-102217

# **Competitors**

Unlike most devices on the market, The GRID works for right and left-handed pitchers, hitters, and catchers without requiring calibration or moving measuring devices around for changing handedness and can be placed indoors or outdoors and can be used for multiple sports to obtain professional quality analytics.

The GRID is bi-directional- meaning The GRID can capture the sports object data and biometric data from the movement of the sport object (ball) through The GRID in one direction and then during that same event, capture the data of the sport object (ball) as it goes back through The GRID. This translates to a pitch-then-hit event, a pitch-then-catcher throw event, etc...

Other competitive systems sell their products (from hundreds of dollars to tens of thousands of dollars). For many facilities, this cash outlay can be burdensome and unattainable, especially given the multiple devices that would need to be purchased elsewhere to achieve even close to the same measurements from The GRID, while providing far less accurate, less consistent, and non-curated data that would somehow need to be combined into a single report.

# *Current Stage and Roadmap*

# **Current Stage**

The initial rollout of The GRID will target youth training centers throughout the US. This includes batting cages (including pitching and catching), various sportsplexes, baseball and softball fields, and youth performance evaluation organizations. The Company is pre-revenue and currently in the product development stage.

With over 4,350 facilities just in the US, the TAM is extremely big and this does not include the future roadmap for Global distribution including golf and cricket.

https://www.ibisworld.com/united-states/market-research-reports/batting-cages-industry/

Athelytix was granted a unique and strong patent for any sports object moving in one direction or bi-directionally tracking velocity, trajectory, and location.

# **Roadmap**

In addition, the roadmap includes R&D to provide a system directly to consumers for use at home, on the field, and transportable.

Athelytix is building an open architecture platform to incorporate APIs from other devices to consolidate the data analytics and reporting - including spin and markerless motion capture software for biomechanical analysis.

Athelytix has created a unique market position and business model by:

-Providing/licensing systems that can do hitting, catching, and pitching through a single system, usable both indoors and outdoors, and installed at no cost to Athelytix’ revenue share customers; and

-Designing a recurring revenue share model for Athelytix customers that provide ongoing recurring revenue to Athelytix increasing as the number of facilities with installed systems increases and without the associated increased cost of operations thereby increasing profitability.

## The Team

### Officers and Directors

**Name:** Norbert Roland Seufert

Norbert Roland Seufert’s current primary role is with the Issuer.

Positions and offices currently held with the issuer:

- **Position:** Director of Marketing

**Dates of Service:** January, 2017 - Present

**Responsibilities:** As Director of Marketing, was responsible for the development of Athelytix’ Pitch Deck, Executive Summary, website development and outreach materials.

**Name:** James Albert Chase Jr.

James Albert Chase Jr.’s current primary role is with Infineon Technologies. James Albert Chase Jr. currently services 5 hours per week in their role with the Issuer.

Positions and offices currently held with the issuer:

- **Position:** Board Member

**Dates of Service:** January, 2017 - Present

**Responsibilities:** Advise leadership team and facilitate introductions to prospective business partners

Other business experience in the past three years:

- Employer: Canosus Ventures
Title: Founder and Principal
Dates of Service: January, 2007 - Present
Responsibilities: I help clients turn great technologies into high growth, profitable businesses.

Other business experience in the past three years:

- Employer: Infineon Technologies
Title: Americas Region Marketing and Business Development, Memory Solutions
Dates of Service: February, 2022 - Present
Responsibilities: Various marketing and business development responsibilities for the memory solutions team at Infineon Technologies

Name: Lawrence E. Goldenthal

Lawrence E. Goldenthal's current primary role is with the Issuer.

Positions and offices currently held with the issuer:

- Position: COO, General Counsel, and Board Member
Dates of Service: January, 2017 - Present
Responsibilities: Larry is a Shareholder, Board Member, COO and General Counsel and involved in all Operational, Legal, Funding, R&D and day to day operations

Other business experience in the past three years:

- Employer: Leg Holdings LLC
Title: President/General Counsel
Dates of Service: January, 2007 - Present
Responsibilities: Handled acquisition negotiations, regulatory and operational startup issues and project and staff management.

Name: Stephen Dennis Rosen

Stephen Dennis Rosen's current primary role is with the Issuer.

Positions and offices currently held with the issuer:

- Position: Chairman, Chief Executive Officer
Dates of Service: January, 2017 - Present
Responsibilities: Co-Founder, Chairman and CEO involved in all aspects of the business including R&D, Operations, and Executive Management. Stephen spends approximately 36 hours per week working for Athelytix.

Other business experience in the past three years:

- Employer: UGC Media Group
Title: Co-Founder, Managing Member
Dates of Service: January, 2012 - Present
Responsibilities: Founder of a recognized A/V System Integration Company with major international clients, requiring about 5 hours a week of his time.

Other business experience in the past three years:

- Employer: OPM-Services, LLC
Title: Chief Executive Officer
Dates of Service: January, 2014 - Present
Responsibilities: CEO of OPM-Services, a broadcast, AV and software, technology, and business consulting company that has developed multi-platform software and broadcast consulting services to clients in the US and Latin America, requiring about 7 hours a week

Other business experience in the past three years:

- Employer: Smart Screen Networks, Inc.
Title: Chief Visionary Officer
Dates of Service: October, 2012 - December, 2022
Responsibilities: CVO for Smart Screen Networks, a software company for organizing all digital media types for content creators and enterprise user to deliver a quality user experience to multi-platform devises to broadband to IPTV.

## Risk Factors

The SEC requires the company to identify risks that are specific to its business and its financial condition. The company is still subject to all the same risks that all companies in its business, and all companies in the economy, are exposed to. These include risks relating to economic downturns, political and economic events and technological developments (such as hacking and the ability to prevent hacking). Additionally, early-stage companies are inherently more risky than more developed companies. You should consider general risks as well as specific risks when deciding whether to invest.

These are the risks that relate to the Company:

### Uncertain Risk

An investment in the Company (also referred to as “we”, “us”, “our”, or “Company”) involves a high degree of risk and should only be considered by those who can afford

the loss of their entire investment. Furthermore, the purchase of any of the Class B Non Voting Common Stock should only be undertaken by persons whose financial resources are sufficient to enable them to indefinitely retain an illiquid investment. Each investor in the Company should consider all of the information provided to such potential investor regarding the Company as well as the following risk factors, in addition to the other information listed in the Company's Form C. The following risk factors are not intended, and shall not be deemed to be, a complete description of the commercial and other risks inherent in the investment in the Company.

#### ***Our business projections are only projections***

There can be no assurance that the Company will meet our projections. There can be no assurance that the Company will be able to find sufficient demand for our product, that people think it's a better option than a competing product, or that we will be able to provide the service at a level that allows the Company to make a profit and still attract business.

#### ***Any valuation at this stage is difficult to assess***

The valuation for the offering was established by the Company. Unlike listed companies that are valued publicly through market-driven stock prices, the valuation of private companies, especially startups, is difficult to assess and you may risk overpaying for your investment.

#### ***The transferability of the Securities you are buying is limited***

Any Class B Non Voting Common Stock purchased through this crowdfunding campaign is subject to SEC limitations of transfer. This means that the stock/note that you purchase cannot be resold for a period of one year. The exception to this rule is if you are transferring the stock back to the Company, to an 'accredited investor,' as part of an offering registered with the Commission, to a member of your family, trust created for the benefit of your family, or in connection with your death or divorce.

#### ***Your investment could be illiquid for a long time***

You should be prepared to hold this investment for several years or longer. For the 12 months following your investment there will be restrictions on how you can resell the securities you receive. More importantly, there is no established market for these securities and there may never be one. As a result, if you decide to sell these securities in the future, you may not be able to find a buyer. The Company may be acquired by an existing player in the recreational & technology development industry. However, that may never happen or it may happen at a price that results in you losing money on this investment.

#### ***If the Company cannot raise sufficient funds it will not succeed***

The Company, is offering Class B Non Voting Common Stock in the amount of up to $1,235,000 in this offering, and may close on any investments that are made. Even if the maximum amount is raised, the Company is likely to need additional funds in the future in order to grow, and if it cannot raise those funds for whatever reason, including reasons relating to the Company itself or the broader economy, it may not survive. If the Company manages to raise only the minimum amount of funds, sought,

it will have to find other sources of funding for some of the plans outlined in “Use of Proceeds.”

# ***We may not have enough capital as needed and may be required to raise more capital.***

We anticipate needing access to credit in order to support our working capital requirements as we grow. Although interest rates have been relatively low, it is still a difficult environment for obtaining credit on favorable terms. If we cannot obtain credit when we need it, we could be forced to raise additional equity capital, modify our growth plans, or take some other action. Issuing more equity may require bringing on additional investors. Securing these additional investors could require pricing our equity below its current price. If so, your investment could lose value as a result of this additional dilution. In addition, even if the equity is not priced lower, your ownership percentage would be decreased with the addition of more investors. If we are unable to find additional investors willing to provide capital, then it is possible that we will choose to cease our sales activity. In that case, the only asset remaining to generate a return on your investment could be our intellectual property. Even if we are not forced to cease our sales activity, the unavailability of credit could result in the Company performing below expectations, which could adversely impact the value of your investment.

# ***Terms of subsequent financings may adversely impact your investment***

We will likely need to engage in common equity, debt, or preferred stock financings in the future, which may reduce the value of your investment in the Class B Non Voting Common Stock. Interest on debt securities could increase costs and negatively impact operating results. Preferred stock could be issued in series from time to time with such designation, rights, preferences, and limitations as needed to raise capital. The terms of preferred stock could be more advantageous to those investors than to the holders of common stock. In addition, if we need to raise more equity capital from the sale of common stock, institutional or other investors may negotiate terms that are likely to be more favorable than the terms of your investment, and possibly a lower purchase price per share.

# ***Management Discretion as to Use of Proceeds***

Our success will be substantially dependent upon the discretion and judgment of our management team with respect to the application and allocation of the proceeds of this Offering. The use of proceeds described below is an estimate based on our current business plan. We, however, may find it necessary or advisable to reallocate portions of the net proceeds reserved for one category to another, and we will have broad discretion in doing so.

# ***Projections: Forward Looking Information***

Any projections or forward looking statements regarding our anticipated financial or operational performance are hypothetical and are based on management’s best estimate of the probable results of our operations and will not have been reviewed by our independent accountants. These projections will be based on assumptions which management believes are reasonable. Some assumptions invariably will not materialize due to unanticipated events and circumstances beyond management’s

control. Therefore, actual results of operations will vary from such projections, and such variances may be material. Any projected results cannot be guaranteed.

# ***The amount raised in this offering may include investments from company insiders or immediate family members***

Officers, directors, executives, and existing owners with a controlling stake in the company (or their immediate family members) may make investments in this offering. Any such investments will be included in the raised amount reflected on the campaign page.

# ***We are reliant on one main type of service***

All of our current services are variants on one type of service, providing recreational, technology-based products and services. Our revenues are therefore dependent upon the market for online capital formation.

# ***We may never have an operational product or service***

It is possible that there may never be an operational GRID or that the product may never be used to engage in transactions. It is possible that the failure to release the product is the result of a change in business model upon the Company’s making a determination that the business model, or some other factor, will not be in the best interest of the Company and its stockholders/members/creditors.

# ***Some of our products are still in prototype phase and might never be operational products***

We currently operate a working prototype of our GRID technology at a commercial sports facility. However, it is possible that there may never be an operational marketable product or that the product may never be used to engage in transactions. It is possible that the failure to release the marketable product is the result of a change in business model upon the Company’s making a determination that the business model, or some other factor, will not be in the best interest of the Company and its stockholders.

# ***Developing new products and technologies entails significant risks and uncertainties***

We are currently in the research and development stage and have only manufactured a prototype for our GRID. Delays or cost overruns in the development of our GRID which we intend to take to market and failure of the product to meet our performance estimates may be caused by, among other things, unanticipated technological hurdles, difficulties in manufacturing, changes to the design, and regulatory hurdles. Any of these events could materially and adversely affect our operating performance and results of operations.

# ***Minority Holder; Securities with Voting Rights***

The Class B Non Voting Common Stock that an investor is buying has no voting rights attached to them. This means that you will have no rights in dictating on how the Company will be run. You are trusting in management discretion in making good business decisions that will grow your investments. Furthermore, in the event of a liquidation of the Company, you will only be paid out if there is any cash remaining after all of the creditors of the Company have been paid out.

# ***You are trusting that management will make the best decision for the company***

You are trusting in management discretion. You are buying securities as a minority holder and therefore must trust the management of the Company to make good business decisions that grow your investment.

# ***Insufficient Funds***

The Company might not sell enough securities in this offering to meet its operating needs and fulfill its plans, in which case it will cease operating and you will get nothing. Even if we sell all the common stock we are offering now, the Company will (possibly) need to raise more funds in the future, and if it can't get them, we will fail. Even if we do make a successful offering in the future, the terms of that offering might result in your investment in the Company being worth less, because later investors might get better terms.

# ***This offering involves 'rolling closings,' which may mean that earlier investors may not have the benefit of information that later investors have.***

Once we meet our target amount for this offering, we may request that StartEngine instruct the escrow agent to disburse offering funds to us. At that point, investors whose subscription agreements have been accepted will become our investors. All early-stage companies are subject to a number of risks and uncertainties, and it is not uncommon for material changes to be made to the offering terms, or to companies' businesses, plans or prospects, sometimes on short notice. When such changes happen during the course of an offering, we must file an amendment to our Form C with the SEC, and investors whose subscriptions have not yet been accepted will have the right to withdraw their subscriptions and get their money back. Investors whose subscriptions have already been accepted, however, will already be our investors and will have no such right.

# ***Our new product could fail to achieve the sales projections we expected***

Our growth projections are based on an assumption that based upon our novel, patented technology, and that with the Company's contacts as well as with an increased advertising and marketing budget, our products will be able to gain traction in the marketplace at a fast enough rate to be able to move the Company forward. It is possible that our new products will fail to gain market acceptance for any number of reasons. If the new products fail to achieve significant sales and acceptance in the marketplace, this could materially and adversely impact the value of your investment.

# ***We face significant market competition***

We will compete with larger, established companies who currently have similar products on the market and/or various respective product development programs. They may have much better financial means and marketing/sales and human resources than us. They may succeed in developing and marketing competing additional, similar products earlier than us, or superior products than those developed by us. There can be no assurance that competitors will render our technology or products obsolete or that the products developed by us will be preferred to any existing or newly developed technologies. It should further be assumed that competition will intensify.

### ***We are competing against other recreational activities***

Although we are a unique company that caters to a select market, we do compete against other recreational activities. Our business growth depends on the market interest in the Company over other activities.

### ***We are an early stage company and have not yet generated any profits***

Athelytix Inc. was formed on January 30, 2017, and does not intend to enter the commercial marketplace until 2023. Accordingly, the Company has a limited history upon which an evaluation of its performance and future prospects can be made. Our current and proposed operations are subject to all business risks associated with new enterprises. These include likely fluctuations in operating results as the Company reacts to developments in its market, managing its growth and the entry of competitors into the market. We will only be able to pay dividends on any shares once our directors determine that we are financially able to do so. There is no assurance that we will be profitable in the next 3 years or generate sufficient revenues to pay dividends to the holders of any stock of the Company.

### ***We are an early stage company and have limited revenue and operating history***

The Company has a short history, no paying customers, and no current revenue. If you are investing in this Company, it's because you think that Athelytix and its technology is a good idea, that the team will be able to successfully market, and sell the product or service, and that we can price products properly and license and sell sufficient products in the marketplace so that the Company will succeed. Further, the Company has not yet generated revenue and has never turned a profit and there is no assurance that the Company will ever be profitable.

### ***We have existing patents that we might not be able to protect properly***

One of the Company's most valuable assets is its intellectual property. The Company owns patents, trademarks, copyrights, Internet domain names, and trade secrets. We believe one of the most valuable components of the Company is our intellectual property portfolio. Due to the value, competitors may misappropriate or violate the rights owned by the Company. The Company intends to continue to protect its intellectual property portfolio from such violations. It is important to note that unforeseeable costs associated with such practices may invade the capital of the Company.

### ***The cost of enforcing our trademarks and copyrights could prevent us from enforcing them***

Patent, Trademark and copyright litigation has become extremely expensive. Even if we believe that a competitor is infringing on one or more of our patent(s) trademarks or copy-rights, we might choose not to file suit because we lack the cash to successfully prosecute a multi-year litigation with an uncertain outcome; or because we believe that the cost of enforcing our trademark(s) or copyright(s) outweighs the value of winning the suit in light of the risks and consequences of losing it; or for some other reason. Choosing not to enforce our patent (s), trademark(s) or copyright(s) could have adverse consequences for the Company, including undermining the credibility of our intellectual property, reducing our ability to enter into sublicenses,

and weakening our attempts to prevent competitors from entering the market. As a result, if we are unable to enforce our trademark(s) or copy-right(s) because of the cost of enforcement, your investment in the Company could be significantly and adversely affected.

# ***The loss of one or more of our key personnel, or our failure to attract and retain other highly qualified personnel in the future, could harm our business***

To be successful, the Company requires capable people to run its day-to-day operations. As the Company grows, it will need to attract and hire additional employees in sales, marketing, design, development, operations, finance, legal, human resources, and other areas. Depending on the economic environment and the Company's performance, we may not be able to locate or attract qualified individuals for such positions when we need them. We may also make hiring mistakes, which can be costly in terms of resources spent in recruiting, hiring, and investing in the incorrect individual and in the time delay in locating the right employee fit. If we are unable to attract, hire and retain the right talent or make too many hiring mistakes, it is likely our business will suffer from not having the right employees in the right positions at the right time. This would likely adversely impact the value of your investment.

# ***Our ability to sell our product or service is dependent on outside government regulation which can be subject to change at any time***

Our ability to sell products is dependent on outside government regulations such as the FDA (Food and Drug Administration), FTC (Federal Trade Commission), and other relevant government laws and regulations. The laws and regulations concerning the selling of products may be subject to change and if they do then the selling of products may no longer be in the best interest of the Company. At such point, the Company may no longer want to sell the product and therefore your investment in the Company may be affected.

# ***We rely on third parties to provide services essential to the success of our business***

We rely on third parties to provide a variety of essential business functions for us, including manufacturing, shipping, accounting, legal work, public relations, advertising, retailing, and distribution. It is possible that some of these third parties will fail to perform their services or will perform them in an unacceptable manner. It is possible that we will experience delays, defects, errors, or other problems with their work that will materially impact our operations and we may have little or no recourse to recover damages for these losses. A disruption in these key or other suppliers' operations could materially and adversely affect our business. As a result, your investment could be adversely impacted by our reliance on third parties and their performance.

# ***The Company is vulnerable to hackers and cyber-attacks***

As an internet-based business, we may be vulnerable to hackers who may access the data of our investors and the issuer companies that utilize our platform. Further, any significant disruption in service on Athelytix or in its computer systems could reduce the attractiveness of the platform and result in a loss of investors and companies

interested in using our platform. Further, we rely on a third-party technology provider to provide some of our backup technology. Any disruptions of services or cyber-attacks either on our technology provider or on Athelytix could harm our reputation and materially negatively impact our financial condition and business.

#### ***Ability to meet inventory demands.***

Once we are to market, Athelytix may need additional capital to manufacture and place initial GRID systems. Due to the anticipated high demand, this could create a situation where opportunities are lost if we are unable to secure additional funding, as interested customers are unwilling to purchase or place our product due to the lack of inventory available. Supply chain issues are other international risks that could increase the cost of raw materials and delay the manufacture of GRIDS. International inflationary pressures could impact the cost of materials and shipping costs.

#### ***New Competitors in the Market***

The Sports Technology space is ever-evolving, and interested stakeholders are generally looking for new updates and technology. While Athelytix has a unique position of constructing our GRID with open architecture, we are currently unavailable to collect in-game data. There are other products that can collect similar data in a game. It is possible that our stakeholders will prefer future technology that can collect in-game data which could cause a decrease in revenue and demand.

#### ***The Company's Chief Executive Officer was involved in a prior business-related bankruptcy.***

The Company's CEO and Board Chairman, Stephen Rosen, was involved in a bankruptcy proceeding while serving as CEO of a prior, unrelated company, named TV Magic, Inc. The Ch. 7 bankruptcy was filed in 2013 claiming over $4M in liabilities as a result of class action litigation over the employee/contractor status of several vendors used by TV Magic, Inc. Due to the cost of continuing to litigate the issue, TV Magic chose to cease operations and file its Ch. 7 petition, with the proceeding concluding in 2018. Although he no longer has any connection with TV Magic, there is some level of risk in investing in a company whose day-to-day operations are managed by an individual who managed a prior company that filed for bankruptcy.

#### ***The Company's Chief Executive Officer currently has multiple roles.***

The CEO of Athelytix, Inc. (Stephen Rosen) currently splits his time between managing and operating UGC Media Group, OPM-Services, LLC, and Athelytix. Although Stephen intends to devote more of his time to Athelytix moving forward, there is some level of risk in investing in a Company whose day-to-day operations are managed by an individual who is not devoting 100% of their time to the Company. Once Athelytix raises approximately $1,000,000 or more, Stephen plans to devote only minimal time to UGC Media Group and OPM-Services and focus mainly on Athelytix.

# Ownership and Capital Structure; Rights of the Securities

## Ownership

The following table sets forth information regarding beneficial ownership of the company's holders of 20% or more of any class of voting securities as of the date of this Offering Statement filing.

| Stockholder Name | Number of Securities Owned | Type of Security Owned | Percentage |
| --- | --- | --- | --- |
| Norbert Seufert | 1,118,000 | Class A Common Stock | 28.44% |
| Stephen Rosen | 970,000 | Class A Common Stock | 24.67% |

## The Company's Securities

The Company has authorized Class A Common Stock, and Class B Non Voting Common Stock. As part of the Regulation Crowdfunding raise, the Company will be offering up to 486,220 of Class B Non Voting Common Stock.

### *Class A Common Stock*

The amount of security authorized is 15,000,000 with a total of 3,931,500 outstanding.

### *Voting Rights*

One vote per share

### *Material Rights*

There are no material rights associated with Class A Common Stock.

### *Class B Non Voting Common Stock*

The amount of security authorized is 5,000,000 with a total of 0 outstanding.

### *Voting Rights*

There are no voting rights associated with Class B Non Voting Common Stock.

### *Material Rights*

There are no material rights associated with Class B Non Voting Common Stock.

## What it means to be a minority holder

As a minority holder of Class B Non Voting Common Stock of the company, you will have limited rights in regards to the corporate actions of the company, including additional issuances of securities, company repurchases of securities, a sale of the company or its significant assets, or company transactions with related parties. Further, investors in this offering may have rights less than those of other investors, and will have limited influence on the corporate actions of the company.

## Dilution

Investors should understand the potential for dilution. The investor's stake in a company could be diluted due to the company issuing additional shares. In other words, when the company issues more shares, the percentage of the company that you own will go down, even though the value of the company may go up. You will own a smaller piece of a larger company. This increase in number of shares outstanding could result from a stock offering (such as an initial public offering, another crowdfunding round, a venture capital round, angel investment), employees exercising stock options, or by conversion of certain instruments (e.g. convertible bonds, preferred shares or warrants) into stock.

If the company decides to issue more shares, an investor could experience value dilution, with each share being worth less than before, and control dilution, with the total percentage an investor owns being less than before. There may also be earnings dilution, with a reduction in the amount earned per share (though this typically occurs only if the company offers dividends, and most early stage companies are unlikely to offer dividends, preferring to invest any earnings into the company).

## Transferability of securities

For a year, the securities can only be resold:

- In an IPO;
- To the company;
- To an accredited investor; and
- To a member of the family of the purchaser or the equivalent, to a trust controlled by the purchaser, to a trust created for the benefit of a member of the family of the purchaser or the equivalent, or in connection with the death or divorce of the purchaser or other similar circumstance.

## Recent Offerings of Securities

We have made the following issuances of securities within the last three years:

The Company has not had any recent offering of securities in the last three years.

## Financial Condition and Results of Operations

### Financial Condition

*You should read the following discussion and analysis of our financial condition and results of our operations together with our financial statements and related notes appearing at the end of this Offering Memorandum. This discussion contains forward-looking statements reflecting our current expectations that involve risks and uncertainties. Actual results and the timing of events may differ materially from those*

*contained in these forward-looking statements due to a number of factors, including those discussed in the section entitled “Risk Factors” and elsewhere in this Offering Memorandum.*

## Results of Operations

Circumstances which led to the performance of financial statements:

Year ended December 31, 2021 compared to year ended December 31, 2020

### Revenue

Revenue for fiscal year 2020 was $0 compared to $0 in fiscal year 2021.

### Cost of sales

Cost of Sales for fiscal year 2020 was $0 compared to $0 in fiscal year 2021.

### Gross margins

Gross margins for fiscal year 2020 were $0 compared to $0 in fiscal year 2021.

### Expenses

Expenses for fiscal year 2020 were $8,881 compared to $5,326 in fiscal year 2021.

In 2020 and 2021, we were in stealth mode working on the Proof of Concept so we were maintaining our Tech stack subscriptions.

### Historical results and cash flows:

The historical financials DO NOT reflect the cash flow and revenues for Athelytix in the future. Upon completion of the Minimal Viable Product (within 6 months of funding) Athelytix will begin placing free systems (revenue share) into facilities across the US and sell systems to MLB and other professional teams that do nto rev share. Estimated Athelytix cash flow and annaul growth and profit can be seen on the 5 year ProForma.

## Liquidity and Capital Resources

What capital resources are currently available to the Company? (Cash on hand, existing lines of credit, shareholder loans, etc...)

As of February 2023, the Company has capital resources available in the form of capital contributions from shareholders in the amount of $30,000.

How do the funds of this campaign factor into your financial resources? (Are these funds critical to your company operations? Or do you have other funds or capital resources available?)

We believe the funds of this campaign are critical to our company operations.

These funds are required to support product development, installation, and fulfillment with sales and marketing to grow the business.

**Are the funds from this campaign necessary to the viability of the company? (Of the total funds that your company has, how much of that will be made up of funds raised from the crowdfunding campaign?)**

We believe the funds from this campaign are necessary to the viability of the Company. Of the total funds that our Company has, 40% will be made up of funds raised from the crowdfunding campaign, if it raises its maximum funding goal.

**How long will you be able to operate the company if you raise your minimum? What expenses is this estimate based on?**

If the Company raises the minimum offering amount, we anticipate the Company will be able to operate for 6 months. This is based on the current R&D projections for the development of the Minimum Viable Product (MVP).

**How long will you be able to operate the company if you raise your maximum funding goal?**

If the Company raises the maximum offering amount, we anticipate the Company will be able to operate for 14 months. This is based on a projected burn rate of $70,000 monthly burn rate of for expenses related to sales and marketing, installation and fulfillment, inventory, and R&D.

**Are there any additional future sources of capital available to your company? (Required capital contributions, lines of credit, contemplated future capital raises, etc...)**

Currently, the Company has contemplated additional future sources of capital including potential debt financing, or, convertible equity financing. Any potential funding would not be consummated until the close of the offering and terms are not available.

## Indebtedness

The Company does not have any material terms of indebtedness.

## Related Party Transactions

- • **Name of Entity:** OPM-Services, LLC  
  **Names of 20% owners:** Susan C Martinko-Rosen and Stephen D Rosen  
  **Relationship to Company:** 20%+ Owner  
  **Nature / amount of interest in the transaction:** OPM will be providing management, direction, oversight, project management, hardware and software development services, accounting and business operations consulting  
  **Material Terms:** OPM will provide services noted above for a rate of \$250.00 per hour with a maximum monthly of \$10,000
- • **Name of Entity:** Vasiliauskas Holdings, LLC  
  **Names of 20% owners:** Jared Vasiliauskas  
  **Relationship to Company:** Director  
  **Nature / amount of interest in the transaction:** Baseball Consulting, Relationship Building, Business Introductions in industry and legal counsel.  
  **Material Terms:** Entity will provide the aforementioned services at \$250 per hour with a monthly maximum of \$3,000
- • **Name of Entity:** LEG Holdings, LLC  
  **Names of 20% owners:** Lawrence Goldenthal  
  **Relationship to Company:** Director  
  **Nature / amount of interest in the transaction:** Supervision of Operations, Coordination of vendors, Relationship Building, Contract negotiation and legal counsel.  
  **Material Terms:** The entity will provide services as noted above at \$250.00 per hour with a monthly maximum of \$10,000
- • **Name of Entity:** Dan Evans 108, LLC  
  **Names of 20% owners:** Dan Evans  
  **Relationship to Company:** Director  
  **Nature / amount of interest in the transaction:** Relationship Building, Business Introductions in industry, Key Accounts Management, R&D Team  
  **Material Terms:** Entity will charge at \$250.00 per hour with a monthly maximum of \$3,000

## Valuation

**Pre-Money Valuation:** $9,986,010.00

### Valuation Details:

Athelytix engaged a neutral 3rd party firm to determine the valuation. The valuation set is based on a review of the Company's pre-money valuation using multiple techniques.

Score Card Method = $13,000,000

Checklist Method = $11,000,000

VC Method = $9,000,000

DCR with LTG = $10,000,000

The valuation is based on assumptions regarding the opportunity for Athelytix’ patented technology, the lack of existing comparable technologies, the total addressable market, financial projections, and the makeup of the Athelytix Team assembled to achieve the growth and expansion goals as set out in this offering.

## Market Growth & Trends

Analytics are transforming the world of sports and training by providing measurement data on all aspects of athletic performance; The worldwide sports analytics market is projected to grow to $12.6 Billion by 2029* CAGR of 28.1% in the forecast period, 2022-2029 https://www.fortunebusinessinsights.com/sports-analytics-market-102217

However, access to quality analytics is largely limited to professional athletes. Athelytix will extend broad-based access to precision analytics to the youth and amateur sports markets with a novel revenue-sharing licensing model that promises to promote quick adoption while eliminating barriers to entry. Our patented technology has myriad applications across a wide variety of sports, starting with baseball and softball. The GRID is believed to be the only device that captures pitching, hitting, and catching data utilizing a single system.

## Capabilities of Current Prototype

- ● The GRID is believed to be the only system that can evaluate pitchers, hitters, and catchers using a single system.
- ● Using lasers as a beam interrupt is the most accurate way to measure sports object data and is not influenced by the Doppler effect, or Infrared requirements to eliminate ambient light. Athelytix’ patent protects its rights to utilize this technology.
- ● The GRID technology allows for multiple curated accurate bi-directional sports object data measurements through multiple GRIDS and not a single source such as a radar gun. By example, The GRID pitching system makes measurements through at least 3 GRIDS of the baseball moving through the pitching path, which allows for a more accurate measure of data.
- ● Unlike most devices on the market, The GRID works for right and left-handed pitchers, hitters, and catchers without requiring calibration or moving measuring devices around for changing handedness and can be placed indoors or outdoors and can be used for multiple sports to obtain professional quality analytics
- ● The GRID is constructed with open architecture, which allows the incorporation of other third-party data so that the user can curate data captured with other devices, and their data into a single report.

● Other competitive systems sell their products (from hundreds of dollars to tens of thousands of dollars). For many facilities this cash outlay can be burdensome and unattainable, making the use of technology and analytics impractical at those facilities. The GRID provides these facilities the opportunity to have access to high-quality data, without the substantial cash outlay.

# The Value of the Company's Assets

- Athelytix has developed patented, laser-based hardware and incorporated proprietary software algorithm systems that power our initial technology The GRID.
- Athelytix' Patented Laser-based solution is superior to Radar and Infrared
- Athelytix' USPTO Utility Patent was issued in 2017
- The ATHELYTIX platform combines a laser array with predictive analytics. Provides BI-DIRECTIONAL data in a single event (e.g. pitch and hit; pitch and throw).
- The GRID is accurate to within*:
  - .08 inches
  - 1 mph
  - 1 degree
  - As tested/confirmed by Rock West Solutions

# Business Partnerships & Relationships

Athelytix is working to partner with a variety of 3rd party companies to increase the measurement tools for an event (such as spin, bat swing, and most importantly markerless technology to overlay on the collected biomechanics HD video feeds (pitching, hitting, catching weight, balance, arm, and body positioning angles, thrust and acceleration)

Athelytix also is working with partners to develop databases whereby current SAS platforms that work to recruit college athletes will create their internal customer profiles using the GRID

Athelytix is working with nationally recognized and respected trainers, youth sports recruiters, and others to create pitching, hitting, and catching GRID scores for athletes of all levels to compare their data against other athletes and to be able to efficiently in an organized report share their data and scores with colleges, universities, pro and amateur teams and the like.

# Management's Experience & Successes

The CEO, Stephen Rosen, founded, grew, and managed a broadcast system A/V company from his garage into one of the biggest privately owned SI's in the US doing

10's of millions of dollars per year. The company had offices in San Diego, Los Angeles, and Mexico and did multi-million dollar projects around the world and at times over 200 employees. In addition, for over 30 years, Steve has been a serial entrepreneur involved in several start-ups along with major non-profit philanthropic start-ups for K-12 education raising millions of dollars to support education. Steve's experience includes starting, growing, managing, and operating both consumer/customer and business-facing businesses as a Board Director and CEO.

A member of our board of directors, Jared Vasiliauskas, has counseled start-ups in various industries on the formation of their entity, and legal questions pertaining to operations as part of my practice in the past 5 years.

Larry Goldenthal, Chief Operating Officer, General Counsel, and member of our board of directors, has represented several startups and provided legal advice as to corporate formations, and corporate governance including the division of roles and responsibilities, the preparation of legal documents and agreements with third parties, regulatory and legal matters relevant to the business, advise regarding staffing and HR and the like.

## Conclusion

Based on the analysis above, the Company believes its $9,986,010 valuation is accurate.

## *Disclaimers*

*The Company set its valuation internally, without a formal-third party independent evaluation.*

*The pre-money valuation has been calculated on a fully diluted basis. In making this calculation, we have assumed: (i) there are no outstanding options, warrants, or other securities with a right to acquire shares; and (ii) there are no shares reserved for issuance under a stock plan.*

## Use of Proceeds

If we raise the Target Offering Amount of $9,999.98 we plan to use these proceeds as follows:

- *StartEngine Platform Fees*  
  5.5%
- *StartEngine Service Fees*  
  94.5%  
  Fees for certain services provided by StartEngine

If we raise the over allotment amount of $1,234,998.80, we plan to use these proceeds as follows:

- StartEngine Platform Fees

5.5%

- Sales and Marketing

12.0%

Sales and marketing using a variety of tools and outreach: ☐ Using Social Media including Facebook, Instagram, LinkedIn and others and post information and solicitations to acquire The GRID systems for facilities; ☐ Direct email using tech stack tools to increase our database and use our CRM for direct email campaigns to solicit The GRID acquisitions; ☐ Use programmatic advertising to create brand awareness and solicit The GRID acquisitions for facilities; ☐ Continue sales and marketing activities, to include utilizing our existing database to obtain initial orders from the almost 2000 facilities in the United States at which we will initially place licensed GRIDS; ☐ Negotiate agreements with MLB and MiLB organizations for the sale and placement of GRIDS at training, scouting and stadium locations ☐ Expand our existing social media presence including with targeting posts and ads in relevant spaces and groups; ☐ Re-develop our existing website to be business to business and consumer facing, including with regular blog posts and links to other relevant sites; ☐ Continue and expand our existing email campaign utilizing our existing large database.

- Research & Development

31.0%

Proceeds will be used to develop the consumer and business facing Minimum Viable Product (MVP) to place in service and begin to generate revenue. Roadmap updates will continue including portability, upgrades to graphics, integration of additional 3rd party tools,

- Operations

10.0%

☐ Athelytix will be utilizing funds after the development of the MVP to construct and place GRID systems. These systems will be primarily licensed, although some may be sold. ☐ Athelytix will be utilizing a team to assist with the procurement, placement and installation of GRIDs and the procurement of all component parts to construct the GRID. ☐ Athelytix will continue post install to assist in supporting the GRID installations

- Inventory

40.5%

☐ The system is designed to minimize the SKU's for installation and fulfillment and once the MVP design is complete, funds will be used for inventory for installation and fulfillment

- StartEngine Service Fees

1.0%

Fees for certain services provided by StartEngine.

The Company may change the intended use of proceeds if our officers believe it is in the best interests of the company.

## Regulatory Information

### Disqualification

No disqualifying event has been recorded in respect to the company or its officers or directors.

### Compliance Failure

The company has not previously failed to comply with the requirements of Regulation Crowdfunding.

### Ongoing Reporting

The Company will file a report electronically with the SEC annually and post the report on its website no later than April 29 (120 days after Fiscal Year End). Once posted, the annual report may be found on the Company's website at https://athelytix.com/ (Athelytix.com/investors).

The Company must continue to comply with the ongoing reporting requirements until:

(1) it is required to file reports under Section 13(a) or Section 15(d) of the Exchange Act;

(2) it has filed at least one (1) annual report pursuant to Regulation Crowdfunding and has fewer than three hundred (300) holders of record and has total assets that do not exceed $10,000,000;

(3) it has filed at least three (3) annual reports pursuant to Regulation Crowdfunding;

(4) it or another party repurchases all of the securities issued in reliance on Section 4(a)(6) of the Securities Act, including any payment in full of debt securities or any complete redemption of redeemable securities; or

(5) it liquidates or dissolves its business in accordance with state law.

### Updates

Updates on the status of this Offering may be found at:
www.startengine.com/athelytix

### Investing Process

See Exhibit E to the Offering Statement of which this Offering Memorandum forms a

# **EXHIBIT B TO FORM C**

# **FINANCIAL STATEMENTS AND INDEPENDENT ACCOUNTANT'S REVIEW FOR Athelytix Inc.**

*[See attached]*

# ATHELYTIX, INC.

# FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 2021 AND 2020
(Unaudited)

# INDEX TO FINANCIAL STATEMENTS

(UNAUDITED)

|  | Page |
| --- | --- |
| INDEPENDENT ACCOUNTANT'S REVIEW REPORT | 1 |
| FINANCIAL STATEMENTS: |  |
| Balance Sheet | 2 |
| Statement of Operations | 3 |
| Statement of Changes in Stockholders' Equity | 4 |
| Statement of Cash Flows | 5 |
| Notes to Financial Statements | 6 |

# INDEPENDENT ACCOUNTANT'S REVIEW REPORT

To the Board of Directors

Athelytix, Inc.

San Diego, California

We have reviewed the accompanying financial statements of Athelytix, Inc. (the "Company,"), which comprise the balance sheet as of December 31, 2021 and December 31, 2020, and the related statement of operations, statement of shareholders' equity (deficit), and cash flows for the year ending December 31, 2021 and December 31, 2020, and the related notes to the financial statements. A review includes primarily applying analytical procedures to management's financial data and making inquiries of company management. A review is substantially less in scope than an audit, the objective of which is the expression of an opinion regarding the financial statements as a whole. Accordingly, we do not express such an opinion.

## Management's Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

## Accountant's Responsibility

Our responsibility is to conduct the review in accordance with Statements on Standards for Accounting and Review Services promulgated by the Accounting and Review Services Committee of the AICPA. Those standards require us to perform procedures to obtain limited assurance as a basis for reporting whether we are aware of any material modifications that should be made to the financial statements for them to be in accordance with accounting principles generally accepted in the United States of America. We believe that the results of our procedures provide a reasonable basis for our conclusion.

## Accountant's Conclusion

Based on our review, we are not aware of any material modifications that should be made to the accompanying financial statements in order for them to be in conformity with accounting principles generally accepted in the United States of America.

## Going Concern

As discussed in Note 9, certain conditions indicate that the Company may be unable to continue as a going concern. The accompanying financial statements do not include any adjustments that might be necessary should the Company be unable to continue as a going concern.

SetApart FS

November 4, 2022

Los Angeles, California

- 1 -

# ATHELYTIX INC.

# BALANCE SHEET

# (UNAUDITED)

| As of December 31, | 2021 | 2020 |
| --- | --- | --- |
| (USD $ in Dollars) |  |  |
| ASSETS |  |  |
| Current Assets: |  |  |
| Cash & Cash Equivalents | $33 | $5,359 |
| Total Current Assets | 33 | 5,359 |
| Total Assets | $33 | $5,359 |
| LIABILITIES AND STOCKHOLDERS' EQUITY |  |  |
| Total Liabilities | - | - |
| STOCKHOLDERS EQUITY |  |  |
| Common Stock Class A | 339 | 339 |
| Additional Paid in Capital | 511,661 | 511,661 |
| Retained Earnings/(Accumulated Deficit) | (511,967) | (506,641) |
| Total Stockholders' Equity | 33 | 5,359 |
| Total Liabilities and Stockholders' Equity | $33 | $5,359 |

See accompanying notes to financial statements.

- 2 -

# **ATHELYTIX INC.**  
 **STATEMENTS OF OPERATIONS**  
 **(UNAUDITED)**---

| For Fiscal Year Ended December 31, | 2021 | 2020 |
| --- | --- | --- |
| (USD $ in Dollars) |  |  |
| Net Revenue | $ - | $ - |
| Cost of Goods Sold | - | - |
| Gross profit | - | - |
| Operating expenses |  |  |
| General and Administrative | 3,025 | 3,183 |
| Sales and Marketing | 2,301 | 5,698 |
| Total operating expenses | 5,326 | 8,881 |
| Operating Income/(Loss) | (5,326) | (8,881) |
| Interest Expense | - | - |
| Other Loss/(Income) | - | - |
| Income/(Loss) before provision for income taxes | (5,326) | (8,881) |
| Provision/(Benefit) for income taxes | - | - |
| Net Income/(Net Loss) | $(5,326) | $(8,881) |

*See accompanying notes to financial statements.*

---- 3 -

# **ATHELYTIX INC.**  
 **STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY**  
 **(UNAUDITED)**---

| (In , $US) | Common Stock Class A |  | Additional Paid In Capital | Retained earnings/ (Accumulated Deficit) | Total Shareholder Equity |
| --- | --- | --- | --- | --- | --- |
|  | Shares | Amount |  |  |  |
| Balance-December 31, 2019 | 3,391,500 | $339 | $511,661 | $(497,760) | $14,240 |
| Net income/(loss) |  |  |  | (8,881) | (8,881) |
| Balance-December 31, 2020 | 3,391,500 | 339 | 511,661 | $(506,641) | $5,359 |
| Net income/(loss) |  |  |  | (5,326) | (5,326) |
| Balance-December 31, 2021 | 3,391,500 | $339 | $511,661 | $(511,967) | $33 |

*See accompanying notes to financial statements.*

---- 4 -

# **ATHELYTIX INC.**  
 **STATEMENTS OF CASH FLOWS**  
 **(UNAUDITED)**---

| For Fiscal Year Ended December 31, | 2021 | 2020 |
| --- | --- | --- |
| (USD $ in Dollars) |  |  |
| CASH FLOW FROM OPERATING ACTIVITIES |  |  |
| Net income/(loss) | $(5,326) | $(8,881) |
| Changes in operating assets and liabilities: |  |  |
| Accounts receivable, net | - | - |
| Accounts Payable | - | - |
| Net cash provided/(used) by operating activities | (5,326) | (8,881) |
| CASH FLOW FROM INVESTING ACTIVITIES |  |  |
| Purchases of Property and Equipment | - | - |
| Net cash provided/(used) in investing activities | - | - |
| CASH FLOW FROM FINANCING ACTIVITIES |  |  |
| Capital Contribution | - | - |
| Net cash provided/(used) by financing activities | - | - |
| Change in Cash | (5,326) | (8,881) |
| Cash-beginning of year | 5,359 | 14,240 |
| Cash-end of year | $33 | $5,359 |
| SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION |  |  |
| Cash paid during the year for interest | $ - | $ - |
| Cash paid during the year for income taxes | $ - | $ - |
| OTHER NONCASH INVESTING AND FINANCING ACTIVITIES AND SUPPLEMENTAL DISCLOSURES |  |  |
| Purchase of property and equipment not yet paid for | $ - | $ - |
| Issuance of equity in return for note | - | - |
| Issuance of equity in return for accrued payroll and other liabilities | - | - |

*See accompanying notes to financial statements.*

---- 5 -

ATHELYTIX INC.

NOTES TO FINANCIAL STATEMENTS

FOR YEAR ENDED TO DECEMBER 31, 2021 AND DECEMBER 31, 2020

# 1. NATURE OF OPERATIONS

Athelytix, Inc. was incorporated in January 17, 2017 in the State of Delaware and has been registered as a foreign corporation doing business in the State of California since that time. The financial statements of Athelytix Inc. (which may be referred to as the "Company", "we", "us", or "our") are prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP"). The Company's headquarters are located

Analytix are transforming the world of sports and training by providing measurement data on all aspects of athletic performance. Athelytix' patented GRID system uses optical lasers to track speed and trajectory of sports objects for use in training and recreation. Our technology combines precise data with a video capture of every "event" (e.g. hit or pitch) to identify a player's optimal mechanics. This feedback can accelerate a player's development Our initial target is the nineteen million active baseball and softball participants in the U.S. The system can be deployed at batting cages, stadiums, sports complexes and practice facilities. And because our patent covers the use of lasers across all sports, we have opportunities in entertainment, retail and gaming across a wide variety of sports.

# 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

# Basis of Presentation

The accounting and reporting policies of the Company conform to accounting principles generally accepted in the United States of America ("US GAAP"). The Company has adopted the calendar year as its basis of reporting.

# Use of Estimates

The preparation of financial statements in conformity with United States GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

# Cash and Cash Equivalents

Cash and cash equivalents include all cash in banks. The Company's cash is deposited in demand accounts at financial institutions that management believes are creditworthy. The Company's cash and cash equivalents in bank deposit accounts, at times, may exceed federally insured limits. As of December 31, 2021 and December 31, 2020, the Company's cash and cash equivalents did not exceed FDIC insured limits.

# Income Taxes

Athelytix Inc. is a C corporation for income tax purposes. The Company accounts for income taxes under the liability method, and deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying values of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. A valuation allowance is provided on deferred tax assets if it is determined that it is more likely than not that the deferred tax asset will not be realized. The Company records interest, net of any applicable related income tax benefit, on potential income tax contingencies as a component of income tax expense. The Company records tax positions taken or expected to be taken in a tax return based upon the amount that is more likely than not to be realized or paid, including in connection with the resolution of any related appeals or other legal processes.

- 6 -

# ATHELYTIX INC.

## NOTES TO FINANCIAL STATEMENTS

### FOR YEAR ENDED TO DECEMBER 31, 2021 AND DECEMBER 31, 2020

Accordingly, the Company recognizes liabilities for certain unrecognized tax benefits based on the amounts that are more likely than not to be settled with the relevant taxing authority. The Company recognizes interest and/or penalties related to unrecognized tax benefits as a component of income tax expense.

#### *Concentration of Credit Risk*

The Company maintains its cash with a major financial institution located in the United States of America which it believes to be creditworthy. Balances are insured by the Federal Deposit Insurance Corporation up to $250,000. At times, the Company may maintain balances in excess of the federally insured limits.

#### **Revenue Recognition**

The Company is currently pre-revenue and will follow the provisions and the disclosure requirements described in ASU 2014-09 also referred to as Topic 606. Revenue recognition, according to Topic 606, is determined using the following steps: Recognition of revenue when, or how, a performance obligation is met: Revenues are recognized when or as control of the promised goods or services is transferred to customers.

Revenue recognition, according to Topic 606, is determined using the following steps:

1) Identification of the contract, or contracts, with the customer: the Company determines the existence of a contract with a customer when the contract is mutually approved; the rights of each party in relation to the services to be transferred can be identified, the payment terms for the services can be identified, the customer has the capacity and intention to pay and the contract has commercial substance.

2) Identification of performance obligations in the contract: performance obligations consist of a promised in a contract (written or oral) with a customer to transfer to the customer either a good or service (or a bundle of goods or services) that is distinct or a series of distinct goods or services that are substantially the same and that have the same pattern of transfer to the customer.

3) Recognition of revenue when, or how, a performance obligation is met: revenues are recognized when or as control of the promised goods or services is transferred to customers.

The Company will earn revenues through the sale of its patented GRID system which uses optical lasers to track speed and trajectory of sports objects for use in training and recreation.

#### **Fair Value of Financial Instruments**

The carrying value of the Company's financial instruments included in current assets and current liabilities (such as cash and cash equivalents, restricted cash and cash equivalents, accounts receivable, accounts payable and accrued expenses approximate fair value due to the short-term nature of such instruments).

The inputs used to measure fair value are based on a hierarchy that prioritizes observable and unobservable inputs used in valuation techniques. These levels, in order of highest to lowest priority, are described below:

**Level 1**-Quoted prices (unadjusted) in active markets that are accessible at the measurement date for identical assets or liabilities.

**Level 2**-Observable prices that are based on inputs not quoted on active markets but corroborated by market data.

---- 7 -

# ATHELYTIX INC.

## NOTES TO FINANCIAL STATEMENTS

### FOR YEAR ENDED TO DECEMBER 31, 2021 AND DECEMBER 31, 2020

*Level 3*-Unobservable inputs reflecting the Company’s assumptions, consistent with reasonably available assumptions made by other market participants. These valuations require significant judgment.

#### Subsequent Events

The Company considers events or transactions that occur after the balance sheet date, but prior to the issuance of the financial statements to provide additional evidence relative to certain estimates or to identify matters that require additional disclosure. Subsequent events have been evaluated through November 4, 2022, which is the date the financial statements were issued.

#### Recently Issued and Adopted Accounting Pronouncements

FASB issued ASU No. 2019-02, leases, that requires organizations that lease assets, referred to as “lessees”, to recognize on the balance sheet the assets and liabilities for the rights and obligations created by those leases with lease terms of more than twelve months. ASU 2019-02 will also require disclosures to help investors and other financial statement users better understand the amount, timing, and uncertainty of cash flows arising from leases and will include qualitative and quantitative requirements. The new standard for nonpublic entities will be effective for fiscal years beginning after December 15, 2021, and interim periods within fiscal years beginning after December 15, 2022, and early application is permitted. We are currently evaluating the effect that the updated standard will have on the financial statements and related disclosures.

The FASB issues ASUs to amend the authoritative literature in ASC. There have been a number of ASUs to date, including those above, that amend the original text of ASC. Management believes that those issued to date either (i) provide supplemental guidance, (ii) are technical corrections, (iii) are not applicable to us or (iv) are not expected to have a significant impact on our financial statements.

### 3. CAPITALIZATION AND EQUITY TRANSACTIONS

#### Common Stock

The Company is authorized to issue 20,000,000 shares of Common Stock of class A and class B non-voting with a par value of $0.0001. As of December 31, 2021, and December 31, 2020, 3,391,500 shares of Class A have been issued and are outstanding.

### 4. DEBT

As of December 31, 2021, the company had no debt outstanding.

---- 8 -

# **ATHELYTIX INC.**

# **NOTES TO FINANCIAL STATEMENTS**

# **FOR YEAR ENDED TO DECEMBER 31, 2021 AND DECEMBER 31, 2020**---

# **5. INCOME TAXES**

The provision for income taxes for the year ended December 31, 2021, and December 31, 2020 consists of the following:

| As of Year Ended December 31, | 2021 | 2020 |
| --- | --- | --- |
| Net Operating Loss | $(1,589) | $(2,650) |
| Valuation Allowance | 1,589 | 2,650 |
| Net Provision for income tax | $ - | $ - |

Significant components of the Company's deferred tax assets and liabilities at December 31, 2021, and December 31, 2020 are as follows:

| As of Year Ended December 31, | 2021 | 2020 |
| --- | --- | --- |
| Net Operating Loss | $(6,478) | $(4,889) |
| Valuation Allowance | 6,478 | 4,889 |
| Total Deferred Tax Asset | $ - | $ - |

Management assesses the available positive and negative evidence to estimate if sufficient future taxable income will be generated to use the existing deferred tax assets. On the basis of this evaluation, the Company has determined that it is more likely than not that the Company will not recognize the benefits of the federal and state net deferred tax assets, and, as a result, full valuation allowance has been set against its net deferred tax assets as of December 31, 2021 and December 31, 2020. The amount of the deferred tax asset to be realized could be adjusted if estimates of future taxable income during the carryforward period are reduced or increased.

For the fiscal year ending December 31, 2021, the Company had federal cumulative net operating loss ('NOL') carryforwards of $21,709 and the Company had state net operating loss ('NOL') carryforwards of approximately $21,709. Utilization of some of the federal and state NOL carryforwards to reduce future income taxes will depend on the Company's ability to generate sufficient taxable income prior to the expiration of the carryforwards. The federal net operating loss carryforward is subject to an 80% limitation on taxable income, does not expire, and will carry on indefinitely.

The Company recognizes the impact of a tax position in the financial statements if that position is more likely than not to be sustained on a tax return upon examination by the relevant taxing authority, based on the technical merits of the position. As of December 31, 2021, and December 31, 2020, the Company had no unrecognized tax benefits.

The Company recognizes interest and penalties related to income tax matters in income tax expense. As of December 31, 2021, and December 31, 2020, the Company had no accrued interest and penalties related to uncertain tax positions.

# **6. RELATED PARTY**

There are no related party transactions.

---- 9 -

# **ATHELYTIX INC.**

# **NOTES TO FINANCIAL STATEMENTS**

# **FOR YEAR ENDED TO DECEMBER 31, 2021 AND DECEMBER 31, 2020**---

# **7. COMMITMENTS AND CONTINGENCIES**

# **Contingencies**

The Company's operations are subject to a variety of local and state regulation. Failure to comply with one or more of those regulations could result in fines, restrictions on its operations, or losses of permits that could result in the Company ceasing operations.

# **Litigation and Claims**

From time to time, the Company may be involved in litigation relating to claims arising out of operations in the normal course of business. As of December 31, 2021, there were no pending or threatened lawsuits that could reasonably be expected to have a material effect on the results of the Company's operations.

# **8. SUBSEQUENT EVENTS**

The Company has evaluated subsequent events for the period from December 31, 2021 through November 4, 2022, which is the date the financial statements were available to be issued.

There have been no events or transactions during this time which would have a material effect on these financial statements.

# **9. GOING CONCERN**

The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has a net operating loss of $5,326, an operating cash flow loss of $5,326, and liquid assets in cash of $33, which less than a year's worth of cash reserves as of December 31, 2021. These factors normally raise doubt about the Company's ability to continue as a going concern.

The Company's ability to continue as a going concern in the next twelve months following the date the financial statements were available to be issued is dependent upon its ability to produce revenues and/or obtain financing sufficient to meet current and future obligations and deploy such to produce profitable operating results.

Management has evaluated these conditions and plans to generate revenues and raise capital as needed to satisfy its capital needs. During the next twelve months, the Company intends to fund its operations through debt and/or equity financing.

There are no assurances that management will be able to raise capital on terms acceptable to the Company. If it is unable to obtain sufficient amounts of additional capital, it may be required to reduce the scope of its planned development, which could harm its business, financial condition, and operating results. The accompanying financial statements do not include any adjustments that might result from these uncertainties.

---- 10 -

# **EXHIBIT C TO FORM C**

# **PROFILE SCREENSHOTS**

*[See attached]*

| ![img-0.jpeg](img-0.jpeg) |
| --- |

# EXHIBIT D TO FORM C

# VIDEO TRANSCRIPT

Hello, My name is Mike Fontana, Engineer, former professional baseball player, and inventor of The Grid by Athelytix. The Grid is a laser-based data collection system that captures precision location, speed, and trajectory information bi-directionally of a ball in flight for pitchers, hitters and catchers. By linking this highly accurate data with video of the athletic event, the Grid becomes an extremely powerful player development and talent assessment tool.

The Grid was initially designed to support pitcher development; recognize the difference between two curve balls, or which finger pressure provided more movement on a fastball. To accomplish this, I solicited the help of other premier athletes and aerospace engineers. We concluded that a system capable of comparing the movement of baseball pitches would have to be accurate within .10 inches. We determined a laser-based system was the only way to achieve that level of accuracy.

We built our first system and had it tested by an independent organization. They validated the Grid could track a baseball in motion to within .07 inches. They then concluded that their equipment was the limiting factor and that the Grid was likely much more accurate than they could measure.

In addition to it's superior accuracy, the Grid's robust design ensure that each Grid System collects data exactly the same way. That means data collected for player one can be precisely compared to data for player two, even if the two players work out with different Grids at different locations. This ability to collect and compare data is an evolutionary step in player assessment.

Once we proved the concept we started expanding the system's functionality. Now the Grid can provide meaningful metrics for pitchers, hitters, and catchers for both baseball and softball. Its modular design allows the Grid to be reconfigured for a multitude of sports; soccer and cricket are next in line.

The Grid by Athelytix is a patented system, based on a patented algorithm that has been tested tens of thousands of times. We believe our system will change the way players train, coaches develop, and organizations assess talent. Not to mention it's a blast for the weekend warrior when used in entertainment mode. I mean, what fan doesn't want to find out if they can hit it out of their favorite stadium, or little league park? Join our team and help Athelytix take players, coaches and organizations to the next level. Invest today to help disrupt the sports analytics industry.

# STARTENGINE SUBSCRIPTION PROCESS (Exhibit E)

# Platform Compensation

- As compensation for the services provided by StartEngine Capital, the issuer is required to pay to StartEngine Capital a fee consisting of a 5.5-13% (five and one-half to thirteen) commission based on the dollar amount of securities sold in the Offering and paid upon disbursement of funds from escrow at the time of a closing. The commission is paid in cash and in securities of the Issuer identical to those offered to the public in the Offering at the sole discretion of StartEngine Capital. Additionally, the issuer must reimburse certain expenses related to the Offering. The securities issued to StartEngine Capital, if any, will be of the same class and have the same terms, conditions and rights as the securities being offered and sold by the issuer on StartEngine Capital's website.
- As compensation for the services provided by StartEngine Capital, investors are also required to pay StartEngine Capital a fee consisting of a 0-3.5% (zero to three and a half percent) service fee based on the dollar amount of securities purchased in each investment.

# Information Regarding Length of Time of Offering

- Investment Cancellations: Investors will have up to 48 hours prior to the end of the offering period to change their minds and cancel their investment commitments for any reason. Once within 48 hours of ending, investors will not be able to cancel for any reason, even if they make a commitment during this period.
- Material Changes: Material changes to an offering include but are not limited to: A change in minimum offering amount, change in security price, change in management, material change to financial information, etc. If an issuer makes a material change to the offering terms or other information disclosed, including a change to the offering deadline, investors will be given five business days to reconfirm their investment commitment. If investors do not reconfirm, their investment will be canceled and the funds will be returned.

# Hitting The Target Goal Early & Oversubscriptions

- StartEngine Capital will notify investors by email when the target offering amount has hit 25%, 50% and 100% of the funding goal. If the issuer hits its goal early, the issuer can create a new target deadline at least 5 business days out. Investors will be notified of the new target deadline via email and will then have the opportunity to cancel up to 48 hours before the new deadline.
- Oversubscriptions: We require all issuers to accept oversubscriptions. This may not be possible if: 1) it vaults an issuer into a different category for financial statement requirements (and they do not have the requisite financial statements); or 2) they reach $5M in investments. In the event of an oversubscription, shares will be allocated at the discretion of the issuer.
- If the sum of the investment commitments does not equal or exceed the target offering amount at the offering deadline, no securities will be sold in the offering, investment commitments will be canceled and committed funds will be returned.
- If a StartEngine issuer reaches its target offering amount prior to the deadline, it may conduct an initial closing of the offering early if they provide notice of the new offering deadline at least five business days prior to the new offering deadline (absent a material change that would require an extension of the offering and reconfirmation of the investment commitment). StartEngine will notify

investors when the issuer meets its target offering amount. Thereafter, the issuer may conduct additional closings until the offering deadline.

# Minimum and Maximum Investment Amounts

- In order to invest, to commit to an investment or to communicate on our platform, users must open an account on StartEngine Capital and provide certain personal and non- personal information including information related to income, net worth, and other investments.
- Investor Limitations: There are no investment limits for investing in crowdfunding offerings for accredited investors. Non-accredited investors are limited in how much they can invest on all crowdfunding offerings during any 12-month period. The limitation on how much they can invest depends on their net worth (excluding the value of their primary residence) and annual income. If either their annual income or net worth is less than $107,000, then during any 12-month period, they can invest either $2,200 or 5% of their annual income or net worth, whichever is greater. If both their annual income and net worth are equal to or more than $107,000, then during any 12-month period, they can invest up to 10% of annual income or net worth, whichever is greater, but their investments cannot exceed $107,000.

### UNITED STATES SECURITIES AND EXCHANGE COMMISSION
**Washington, D.C. 20549**

## FORM C

### UNDER THE SECURITIES ACT OF 1933

### Issuer Information

**Name of Issuer:** Athelytix Inc.

**Legal Status:** Corporation

**Jurisdiction of Incorporation/Organization:** DE

**Date of Organization:** 01-31-2017

**Physical Address:** 10333 Avenida Magnifica, San Diego, CA, 92131

**Issuer Website:** https://athelytix.com/

**Is there a Co-Issuer?:** No

**Intermediary Name:** StartEngine Capital, LLC

**Intermediary CIK:** 0001665160

**Intermediary File Number:** 007-00007

### Offering Information

**Compensation to Intermediary:** up to 9% percent

**Financial Interest in Issuer:** Three percent (3%) of securities of the total amount of investments raised in the offering, along the same terms as investors.

**Type of Security Offered:** Other

**Other Description of Security:** Class B Non Voting Common Stock

**Number of Securities Offered:** 3937

**Price per Security:** $2.54

**Method for Determining Price:** N/A

**Target Offering Amount:** $9,999.98

**Oversubscription Accepted:** Yes

**Oversubscription Allocation Type:** Other

**Description of Oversubscription:** At issuer's discretion, with priority given to StartEngine Owners

**Maximum Offering Amount:** $1,234,998.80

**Deadline to Reach Target Amount:** 04-30-2023

### Annual Report Disclosure Requirements

**Current Number of Employees:** 1

**Total Assets (Most Recent Fiscal Year):** $33.00

**Total Assets (Prior Fiscal Year):** $5,359.00

**Cash & Cash Equivalents (Most Recent Fiscal Year):** $33.00

**Cash & Cash Equivalents (Prior Fiscal Year):** $5,359.00

**Accounts Receivable (Most Recent Fiscal Year):** $0.00

**Accounts Receivable (Prior Fiscal Year):** $0.00

**Short-Term Debt (Most Recent Fiscal Year):** $0.00

**Short-Term Debt (Prior Fiscal Year):** $0.00

**Long-Term Debt (Most Recent Fiscal Year):** $0.00

**Long-Term Debt (Prior Fiscal Year):** $0.00

**Revenues/Sales (Most Recent Fiscal Year):** $0.00

**Revenues/Sales (Prior Fiscal Year):** $0.00

**Cost of Goods Sold (Most Recent Fiscal Year):** $0.00

**Cost of Goods Sold (Prior Fiscal Year):** $0.00

**Taxes Paid (Most Recent Fiscal Year):** $450.00

**Taxes Paid (Prior Fiscal Year):** $450.00

**Net Income (Most Recent Fiscal Year):** $-5,326.00

**Net Income (Prior Fiscal Year):** $-8,881.00

**Jurisdictions Offered:**

ALABAMA, ALASKA, ARIZONA, ARKANSAS, CALIFORNIA, COLORADO, CONNECTICUT, DISTRICT OF COLUMBIA, DELAWARE, FLORIDA, GEORGIA, HAWAII, IDAHO, ILLINOIS, INDIANA, IOWA, KANSAS, KENTUCKY, LOUISIANA, MAINE, MARYLAND, MASSACHUSETTS, MICHIGAN, MINNESOTA, MISSISSIPPI, MISSOURI, MONTANA, NEBRASKA, NEVADA, NEW HAMPSHIRE, NEW JERSEY, NEW MEXICO, NEW YORK, NORTH CAROLINA, NORTH DAKOTA, OHIO, OKLAHOMA, OREGON, PENNSYLVANIA, PR, RHODE ISLAND, SOUTH CAROLINA, SOUTH DAKOTA, TENNESSEE, TEXAS, UTAH, VERMONT, VIRGINIA, WASHINGTON, WEST VIRGINIA, WISCONSIN, WYOMING

### Signatures

**Issuer:** Athelytix Inc.

**Signature:** Stephen D Rosen

**Title:** Board Chairman, CEO and Principal Accounting Officer

---

**Signature:** Stephen D Rosen

**Title:** Board Chairman, CEO and Principal Accounting Officer

**Date:** 03-31-2023

---

**Signature:** Lawrence E. Goldenthal

**Title:** Director, COO, and General Counsel

**Date:** 03-31-2023

---

**Signature:** Norb Seufert

**Title:** President and Marketing Director

**Date:** 03-31-2023

---

**Signature:** Jim Chase

**Title:** Board Director

**Date:** 03-31-2023