NOTE
1 – NATURE OF OPERATIONS
Company
Background
Altitude
International Holdings, Inc. (f/k/a Altitude International, Inc., the “Company,” “we,” “us,” “our,”
or “Altitude-NY”), was incorporated in the State of New York on July 13, 1994 as “Titan Computer Services, Inc.”
On
June 27, 2017, the Company successfully closed a Share Exchange transaction (the “Share Exchange”) with the shareholders
of Altitude International, Inc. (“Altitude”), a Wisconsin corporation. Altitude was incorporated on May 18, 2017 under the
laws of the state of Wisconsin and has been operating as a wholly owned subsidiary of Altitude-NY since the Share Exchange. Altitude
operates through Northern, Central, and South America sales to execute the current business plan of athletic training industry, specifically
altitude training. Our objective is to be recognized as one of the upper tier specialty altitude training equipment providers in the
Americas.
On
February 13, 2018, the majority of the shareholders of the Company approved the amendment to the Articles of Incorporation to change
the Company’s name from “Titan Computer Services, Inc.” to “Altitude International, Inc.” The purpose of
the name change was to help further our brand identity and will reflect the major focus of our business operations, the manufacturing
and distribution of products in the athletic training industry, specifically altitude training.
On
February 14, 2020, the majority of shareholders of the Company and the Board of Directors authorized a change in the Company’s
name to “Altitude International Holdings, Inc.” to reflect more diversified operations going forward. The Articles of Amendment
finalizing this name change have not yet been filed by the Company.
On
April 24, 2020, the Company formed a wholly owned subsidiary in Wisconsin called “Altitude Sports Management Corp.,” an entity
that will providing fully integrated wealth, health, and career management services to its clients.
On
August 21, 2020, the Company filed with the State of New York to change the name from Altitude International, Inc. to Altitude International
Holdings, Inc.
Further,
on January 17, 2021, Altitude International Holdings, Inc. (the “Company” or “Altitude”)
entered into a Letter of Intent (the “LOI”) with Breunich Holdings, Inc., a privately held Delaware corporation
(“BHI”). The LOI sets forth the headline terms of a proposed Share Exchange of Altitude with BHI through which
100% of the BHI shares will be exchanged for up to 80% of then-issued and outstanding shares of Altitude. Greg Breunich, the
Company’s chief executive officer, chief financial officer and chairman, controls BHI.
Upon
the terms and subject to the conditions set forth in the LOI, following the Share Exchange, (i) BHI and its subsidiaries will be wholly-owned
subsidiaries of Altitude; (ii) BHI shareholders would own approximately 80% of the common shares of Altitude, and Altitude shareholders
would own approximately 20% of the common shares of Altitude, with such percentages calculated on a fully diluted basis; and (iii) BHI
has the right to appoint a majority of the directors of Altitude following the Share Exchange.
The
completion of the Share Exchange would be subject to the satisfaction of specific conditions set forth in the LOI, including the completion
of an audit of BHI and its subsidiaries and the parties first negotiating and executing a definitive Share Exchange agreement (the “Share
Exchange Agreement”). These conditions may not ever be satisfied, the Company may never enter into a definitive Share Exchange
Agreement with BHI, the Share Exchange with BHI may never be consummated, and even if it is, it may not be consummated on the terms described
therein.
On
February 10, 2021, The Company filed with the State of New York to increase the authorized shares of common stock of the Company to 600,000,000
shares.
Nature
of Operations
The
product designs to be licensed from Sporting Edge UK, Ltd (“Sporting Edge UK”) are proven and cover a wide range of room
sizes. The only requirement is to change from metric to imperial sizes where necessary.
There
are three unique elements to the Altitude product:
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Sophisticated
Touch Screen control systems capable of integrating the control of simulated altitude, temperature and humidity.
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A
unique design of Air Separation Unit with only a single active part that provides for ultra-reliable operation and a design life
of greater than fifteen years.
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Proven
training protocols that allow the desired training benefits to be achieved.
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Altitude
is transitioning to a more multi-discipline enterprise, blending performance-based education, sports, science, and technology. The targeted
consumer segments include but are not limited to juniors, adults, professionals. ALTD’s multi-discipline approach consists of wholly
owned stand-alone academies, wellness, and manufacturing/assembly facilities.
Altitude
International Holdings, Inc.
Altitude
International Holdings, Inc. (“Altitude”) was incorporated on May 18, 2017 under the laws of the state of Wisconsin with
100,000,000 authorized common stock with $0.001 par value. On May 18, 2017, 6,102,000 shares of common stock at $0.001 (par) were issued
as founder shares, valued at a total of $6,102 to 15 individuals. These shares were issued for future potential services from these various
individuals and as of the date of this issuance, no value was placed on these future potential services and were therefore recorded at
par value as stock-based compensation to the founders.
On
June 27, 2017, after the closing of certain Stock Purchase Agreements, in private sale transaction and the Share Exchange Agreement,
a change of control of the Company occurred and the new operational focus of the Company commenced. See Notes 6 and 8.
Altitude
will operate through Northern, Central, and South America to execute the current business plan of athletic training industry, specifically
altitude training. Our objective is to be recognized as one of the upper tier specialty altitude training equipment providers.
Changes
in Management and the Board of Directors
On
July 6, 2020, Greg Whyte resigned as a director of the Company.
On
July 28, 2020, Peter Sandore resigned as director of the Company.
On
December 20, 2020, Greg Whyte, David Vincent, and Greg Breunich were appointed as directors of the Company to fill the vacancies left
upon the resignation of its former directors.
On
January 6, 2021, Robert Kanuth, Chief Executive Officer, Chief Financial Officer, and a member of the Board of Directors resigned as
Chief Executive Officer and Chief Financial Officer of the Company. He also resigned as Chairman of the Board of Directors but remains
a member of the Board of Directors of the Company.
On
January 6, 2021, Greg Breunich was appointed Chief Executive Officer, Chief Financial Officer, and Chairman of the Board of Directors
of the Company.
On
February 2, 2021, Greg Anthony was appointed Chief Communications Officer and Company Spokesperson of the Company.
On
March 19, 2021, Joseph B. Frost resigned as a director and officer of the Company.
On
March 24, 2021, Gabe Jaramillo was appointed as Executive Vice President and Director of Tennis Training. On March 26, 2021, Mr. Jaramillo
was appointed to the Board of Directors of the Company.
NOTE
2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis
of presentation
The
Company follows the accrual basis of accounting in accordance with generally accepted accounting principles in the United States of America
and has a year-end of December 31.
Management
further acknowledges that it is solely responsible for adopting sound accounting practices, establishing and maintaining a system of
internal accounting control and preventing and detecting fraud. The Company’s system of internal accounting control is designed
to assure, among other items, that 1) recorded transactions are valid; 2) valid transactions are recorded; and 3) transactions are recorded
in the proper period in a timely manner to produce financial statements which present fairly the financial condition, results of operations
and cash flows of the Company for the respective periods being presented.
The
unaudited condensed consolidated financial statements of the Company for the three month periods ended March 31, 2021 and 2020 have been
prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information
and pursuant to the requirements for reporting on Form 10-Q and Regulation S-X. Accordingly, they do not include all the information
and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements.
However, such information reflects all adjustments (consisting solely of normal recurring adjustments), which are, in the opinion of
management, necessary for the fair presentation of the financial position and the results of operations. Results shown for interim periods
are not necessarily indicative of the results to be obtained for a full fiscal year. The balance sheet information as of December 31,
2020 was derived from the audited financial statements included in the Company’s financial statements as of and for the year ended
December 31, 2020 included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”)
on March 31, 2021. These financial statements should be read in conjunction with that report.
Going
Concern and Liquidity
We
have incurred recurring losses since inception and expect to continue to incur losses as a result of legal and professional fees and
our corporate general and administrative expenses. At March 31, 2021, we had $95,378 in cash. Our net losses incurred for the three months
ended March 31, 2021 were $2,985,449 and working capital deficit was $209,574 at March 31, 2021. As a result, there is substantial doubt
about our ability to continue as a going concern. In the event that we are unable to generate sufficient cash from our operating activities
or raise additional funds, we may be required to delay, reduce or severely curtail our operations or otherwise impede our on-going business
efforts, which could have a material adverse effect on our business, operating results, financial condition and long-term prospects.
The Company expects to seek to obtain additional funding through increased revenues and future financings. There can be no assurance
as to the availability or terms upon which such financing and capital might be available. The accompany financial statements have been
prepared assuming that the Company will continues as a going concern.
Principles
of Consolidation
The
unaudited condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, Altitude.
All significant intercompany balances and transactions have been eliminated in the consolidation. The consolidated financial statements
included herein, presented in accordance with United States generally accepted accounting principles (“GAAP”) and stated
in United States dollars, have been prepared by the Company, pursuant to the rules and regulations of the Securities and Exchange Commission.
Use
of Estimates
The
preparation of financial statements in conformity with generally accepted accounting principles in the United States of America requires
management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosure of contingent
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
The
Company considers all highly liquid investments with original maturities of three months or less to be cash equivalents.
Property,
Plant and Equipment
Property
and equipment are stated at cost, net of accumulated depreciation. Expenditures that extend the life, increase the capacity, or improve
the efficiency of property and equipment are capitalized, while expenditures for repairs and maintenance are expensed as incurred. Depreciation
is recognized using the straight-line method over the following approximate useful lives:
Machinery
and equipment
3-5
Years
Intangible
Assets
Costs
incurred to file patent applications and acquired intangibles are capitalized when the Company believes that there is a high likelihood
that the patent will be issued and there will be future economic benefit associated with the patent. These costs will be amortized
on a straight-line basis over a 20-year life from the date of patent filing. All costs associated with abandoned patent applications
are expensed. In addition, the Company will review the carrying value of patents for indicators of impairment on a periodic basis
and if it determines that the carrying value is impaired, it values the patent at fair value. As of December 31, 2020, the remaining
carrying value of the patent was impaired. As of March 31, 2021, the balance is $0.
In
accordance with the provisions of the applicable authoritative guidance, the Company’s long-lived assets and amortizable
intangible assets are tested for impairment whenever events or changes in circumstances indicate that their carrying value may
not be recoverable. The Company assesses the recoverability of such assets by determining whether their carrying value can be
recovered through undiscounted future operating cash flows, including its estimates of revenue driven by assumed market segment
share and estimated costs. If impairment is indicated, the Company measures the amount of such impairment by comparing the fair
value to the carrying value. The trademark was impaired as of December 31, 2020.
Impairment
of Long-Lived Assets
The
Company’s long-lived assets and other assets (consisting of property and equipment) are reviewed for impairment in accordance with
the guidance of the FASB ASC Topic 360-10, Property, Plant, and Equipment. Long lived assets are reviewed for impairment whenever events
or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held
and used is measured by a comparison of the carrying amount of an asset to the undiscounted future net cash flows expected to be generated
by that asset. If the carrying amount of an asset exceeds its estimated future undiscounted cash flows, an impairment charge is recognized
by the amount by which the carrying amount of the asset exceeds the fair value of the asset.
Revenue
Recognition
Our
sales are generated primarily from contracts with customers for the design, development, manufacture, and installation of simulated altitude
athletic equipment. We provide our products under fixed-price contracts. Under fixed-price contracts, we agree to perform the specified
work for a pre-determined price. To the extent our actual costs vary from the estimates upon which the price was negotiated, we will
generate more or less profit or could incur a loss.
We
account for a contract after it has been approved by all parties to the arrangement, the rights of the parties are identified, payment
terms are identified, the contract has commercial substance and collectability of consideration is probable.
We
evaluate the products or services promised in each contract at inception to determine whether the contract should be accounted for as
having one or more performance obligations. The products and services in our contracts are typically not distinct from one another due
to their complex relationships, customization, and the significant contract management functions required to perform under the contract.
Accordingly, our contracts are typically accounted for as one performance obligation.
We
determine the transaction price for each contract based on the consideration we expect to receive for the products or services being
provided under the contract.
We
recognize revenue as performance obligations are satisfied and the customer obtains control of the products and services. In determining
when performance obligations are satisfied, we consider factors such as contract terms, payment terms and whether there is an alternative
future use of the product or service. Substantially all of our revenue is recognized over time as we perform under the contract because
if our customer were to terminate the contract for reasons other than our non-performance, we would have the right to recover damages
which would include, among other potential damages, the right to payment for our work performed to date plus a reasonable profit to deliver
products or services that do not have an alternative use to us.
For
performance obligations recognized over time, revenue is recognized based on the extent of progress towards completion of the performance
obligation, generally using the percentage-of-completion cost-to-cost measure of progress for our contracts because it best depicts the
transfer of control to the customer as we incur costs on our contracts. Under the percentage-of-completion cost-to-cost measure of progress,
the extent of progress towards completion is measured based on the ratio of costs incurred to date to the total estimated costs to complete
the performance obligation.
Stock-Based
Compensation
The
Company accounts for stock-based instruments issued to employees in accordance with ASC Topic 718. ASC Topic 718 requires companies to
recognize in the statement of operations the grant-date fair value of stock options and other equity-based compensation issued to employees.
The value of the portion of an award that is ultimately expected to vest is recognized as an expense over the requisite service periods
using the straight-line attribution method. In June 2018, the Financial Accounting Standards Board (“FASB”) issued ASU No.
2018-07, Compensation – Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting, which expands
the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from nonemployees except for certain
circumstances. Any transition impact will be a cumulative-effect adjustment to retained earnings as of the beginning of the year of adoption. We adopted this guidance on January 1, 2019 and the adoption of ASU No. 2018-07 did not have a material
impact on our financial statements. The Company estimates the fair value of stock options at the grant date by using the Black-Scholes
option-pricing model.
Fair
Value of Financial Instruments
The
book values of cash, prepaid expenses, and accounts payable approximate their respective fair values due to the short-term nature of
these instruments. The fair value hierarchy under GAAP distinguishes between assumptions based on market data (observable inputs) and
an entity’s own assumptions (unobservable inputs).
The
hierarchy consists of three levels
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Level
one — Quoted market prices in active markets for identical assets or liabilities;
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Level
two — Inputs other than level one inputs that are either directly or indirectly observable; and
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Level
three — Unobservable inputs developed using estimates and assumptions, which are developed by the reporting entity and reflect
those assumptions that a market participant would use.
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Determining
which category an asset or liability falls within the hierarchy requires significant judgment. We evaluate our hierarchy disclosures
each quarter.
Earnings
(Loss) Per Share
Basic
earnings (loss) per share are computed by dividing the net income by the weighted-average number of shares of common stock and common
stock equivalents (primarily outstanding options and warrants). Common stock equivalents represent the dilutive effect of the assumed
exercise of the outstanding stock options and warrants, using the treasury stock method. The calculation of fully diluted earnings per
share assumes the dilutive effect of the exercise of outstanding options and warrants at either the beginning of the respective period
presented or the date of issuance, whichever is later.
Income
Taxes
The
Company accounts for income taxes in accordance with FASB ASC 740, “Income Taxes.” Deferred tax assets and liabilities are
recognized for the future tax consequences attributable to temporary differences between the financial statements carrying amounts of
existing assets and liabilities and loss carryforwards and their respective tax bases.
Deferred
tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income (loss) in the years in which those
temporary differences are expected to be recovered or settled.
The
effect of a change in tax rules on deferred tax assets and liabilities is recognized in operations in the year of change. A valuation
allowance is recorded when it is “more likely-than-not” that a deferred tax asset will not be realized.
Tax
benefits of uncertain tax positions are recognized only if it is more likely than not that the Company will be able to sustain
a position taken on an income tax return. The Company has no liability for uncertain tax positions as of March 31, 2021.
Interest and penalties in any, related to unrecognized tax benefits would be recognized as interest expense. The Company does
not have any accrued interest or penalties associated with unrecognized tax benefits, nor was any significant interest expense
recognized during the three months ended March 31, 2021.
Contingencies
Certain
conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company, but which will only
be resolved when one or more future events occur or fail to occur. The Company’s management and its legal counsel assess such contingent
liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings
that are pending against the Company or unasserted claims that may result in such proceedings, the Company’s legal counsel evaluates
the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or
expected to be sought therein.
If
the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability
can be estimated, then the estimated liability would be accrued in the Company’s financial statements. If the assessment indicates
that a potentially material loss contingency is not probable, but is reasonably possible, or is probable but cannot be estimated, then
the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material, would be
disclosed.
Loss
contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the nature of the guarantee
would be disclosed.
Recent
Accounting Pronouncements
In
August 2020, the FASB issued ASU 2020-06, Debt with Conversion and Other Options, which simplifies accounting for convertible
instruments. The new guidance eliminates two of the three models in ASC 470-20 that require separating embedded conversion features
from convertible instruments. The guidance also addresses how convertible instruments are accounted for in the diluted earnings
per share calculation. The guidance is effective for fiscal years beginning after December 15, 2023. The Company is currently
evaluating the impact of ASU 2020-06 on its consolidated financial statements.
Recently
Issued Accounting Standards: Management does not believe that any recently issued, but not yet effective, accounting standards if currently
adopted would have a material effect on the accompanying financial statements.
NOTE
3 – NOTES PAYABLE
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Note payable
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March 31, 2021
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December 31, 2020
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Accrued
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Accrued
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Principal
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Interest
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Total
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Principal
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Interest
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Total
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Joseph B. Frost
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$
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-
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$
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-
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$
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-
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$
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40,000
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$
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22,723
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$
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62,723
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Joseph B. Frost
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-
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-
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-
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500
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86
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586
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Joseph B. Frost
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-
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-
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-
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10,000
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4,853
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14,853
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Joseph B. Frost
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-
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-
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-
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13,000
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6,231
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19,231
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Robert Kanuth
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1,500
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118
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1,618
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1,500
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88
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1,588
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Robert Kanuth
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4,200
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323
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4,523
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4,200
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240
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4,440
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Total
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$
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5,700
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$
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441
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$
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6,141
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$
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69,200
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$
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34,221
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$
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103,421
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On
March 2, 2018, Frost, then a director, loaned the Company $40,000 in the form of a promissory note. The note bears interest of 20% and
has the term of one year, at which time all principal and interest will be paid in a balloon payment. In February 2021, the Company paid
this note and accrued interest.
On
July 30, 2018, Frost, then a director, loaned the Company $10,000 in the form of a promissory note. The note bears interest of 20% and
has the term of one year, at which time all principal and interest will be paid in a balloon payment. In February 2021, the Company paid
this note and accrued interest.
On
August 10, 2018, Frost, a director, loaned the Company $13,000 in the form of a promissory note. The note bears interest of 20% and has
the term of six months, at which time all principal and interest will be paid in a balloon payment. In February 2021, the Company paid
this note and accrued interest.
On
November 5, 2018, Frost, a director, loaned the Company $500 in the form of a promissory note. The note bears interest of 8% and has
the term of six months, at which time all principal and interest will be paid in a balloon payment. In February 2021, the Company paid
this note and accrued interest.
On
January 24, 2019, Kanuth, an officer and director, loaned the Company $11,000 in the form of a promissory note. The note bears interest
of 8% and has the term of one year, at which time all principal and interest will be paid in a balloon payment. On July 15, 2019, the
principal of $11,000 and accrued interest of $319 was converted into common stock of the Company. On April 7, 2020, the accrued interest
balance was converted into common stock of the Company (see Note 6).
On
February 4, 2019, Kanuth, an officer and director, loaned the Company $13,197 in the form of a promissory note. The note bears interest
of 8% and has the term of one year, at which time all principal and interest will be paid in a balloon payment. On July 15, 2019, the
principal of $13,197 was converted into common stock of the Company. On April 7, 2020, the accrued interest balance was converted into
common stock of the Company (see Note 6).
On
February 4, 2019, Kanuth, an officer and director, loaned the Company $5,000 in the form of a promissory note. The note bears interest
of 8% and has the term of one year, at which time all principal and interest will be paid in a balloon payment. On July 15, 2019, the
principal of $5,000 was converted into common stock of the Company. On April 7, 2020, the accrued interest balance was converted into
common stock of the Company (see Note 6).
On
April 30, 2019, Kanuth, an officer and director, loaned the Company $6,514 in the form of a promissory note. The note bears interest
of 8% and has the term of one year, at which time all principal and interest will be paid in a balloon payment. On April 7, 2020, the
balance was converted into common stock of the Company (see Note 6).
On
May 23, 2019, Kanuth, an officer and director, loaned the Company $6,544 in the form of a promissory note. The note bears interest of
8% and has the term of one year, at which time all principal and interest will be paid in a balloon payment. On April 7, 2020, the balance
was converted into common stock of the Company (see Note 6).
On
August 13, 2019, Kanuth, an officer and director, loaned the Company $10,000 in the form of a promissory note. The note bears interest
of 8% and has the term of one year, at which time all principal and interest will be paid in a balloon payment. On April 7, 2020, the
balance was converted into common stock of the Company (see Note 6).
On
September 5, 2019, Kanuth, an officer and director, loaned the Company $20,000 in the form of a promissory note. The note bears interest
of 8% and has the term of one year, at which time all principal and interest will be paid in a balloon payment. On April 7, 2020, the
balance was converted into common stock of the Company (see Note 6).
On
September 16, 2019, Kanuth, an officer and director, loaned the Company $10,000 in the form of a promissory note. The note bears interest
of 8% and has the term of one year, at which time all principal and interest will be paid in a balloon payment. On April 7, 2020, the
balance was converted into common stock of the Company (see Note 6).
On
October 16, 2019, Kanuth, an officer and director, loaned the Company $30,000 in the form of a promissory note. The note bears interest
of 8% and has the term of one year, at which time all principal and interest will be paid in a balloon payment. On April 7, 2020, the
balance was converted into common stock of the Company (see Note 6).
On
October 31, 2019, Kanuth, an officer and director, loaned the Company $8,000 in the form of a promissory note. The note bears interest
of 8% and has the term of one year, at which time all principal and interest will be paid in a balloon payment. On April 7, 2020, the
balance was converted into common stock of the Company (see Note 6).
On
November 8, 2019, Kanuth, an officer and director, loaned the Company $70,000 in the form of a promissory note. The note bears interest
of 8% and has the term of one year, at which time all principal and interest will be paid in a balloon payment. On April 7, 2020, the
balance was converted into common stock of the Company (see Note 6).
On
November 25, 2019, Kanuth, an officer and director, loaned the Company $9,000 in the form of a promissory note. The note bears interest
of 8% and has the term of one year, at which time all principal and interest will be paid in a balloon payment. On April 7, 2020, the
balance was converted into common stock of the Company (see Note 6).
On
December 17, 2019, Kanuth, an officer and director, loaned the Company $20,000 in the form of a promissory note. The note bears interest
of 8% and has the term of one year, at which time all principal and interest will be paid in a balloon payment. On April 7, 2020, the
balance was converted into common stock of the Company (see Note 6).
On
January 3, 2020, Kanuth, an officer and director, loaned the Company $10,000 in the form of a promissory note. The note bears interest
of 8% and has the term of one year, at which time all principal and interest will be paid in a balloon payment. On April 7, 2020, the
balance was converted into common stock of the Company (see Note 6).
On
February 8, 2020, Kanuth, an officer and director, loaned the Company $4,860 in the form of a promissory note. The note bears interest
of 8% and has the term of one year, at which time all principal and interest will be paid in a balloon payment. On April 7, 2020, the
balance was converted into common stock of the Company (see Note 6).
On
February 26, 2020, Kanuth, an officer and director, loaned the Company $10,000 in the form of a promissory note. The note bears interest
of 8% and has the term of one year, at which time all principal and interest will be paid in a balloon payment. On April 7, 2020, the
balance was converted into common stock of the Company (see Note 6).
On
March 18, 2020, Kanuth, an officer and director, loaned the Company $30,000 in the form of a promissory note. The note bears interest
of 8% and has the term of one year, at which time all principal and interest will be paid in a balloon payment. On April 7, 2020, the
balance was converted into common stock of the Company (see Note 6).
On
March 31, 2020, Kanuth, an officer and director, loaned the Company $3,129 in the form of a promissory note. The note bears interest
of 8% and has the term of one year, at which time all principal and interest will be paid in a balloon payment. On April 7, 2020, the
balance was converted into common stock of the Company (see Note 6).
On
April 9, 2020, Kanuth, an officer and director, loaned the Company $1,500 in the form of a promissory note. The note bears interest of
8% and has the term of one year, at which time all principal and interest will be paid in a balloon payment. As of March 31, 2021, the
principal balance was $1,500 and the accrued interest was $118. See Note 7.
On
April 15, 2020, Kanuth, an officer and director, loaned the Company $4,200 in the form of a promissory note. The note bears interest
of 8% and has the term of one year, at which time all principal and interest will be paid in a balloon payment. As of March 31, 2021,
the principal balance was $4,200 and the accrued interest was $323. See Note 7.
On
May 5, 2020, the Company received $20,800 in the form of a loan through the CARES Act Paycheck Protection Program. The balance at March
31, 2021 was $20,800.
NOTE
4 – COMMITMENTS AND CONTINGENCIES
The
Company is subject, from time to time, to claims by third parties under various legal disputes. The defense of such claims, or
any adverse outcome relating to any such claims, could have a material adverse effect on the Company’s liquidity, financial
condition and cash flows. As of May 6, 2021, the Company did not have any legal actions pending against it.
On
June 27, 2017, Altitude entered a license agreement with Sporting Edge UK (see Note 1), Sporting Edge UK is the sole and exclusive owner
of and has the right to license to licensee the ability to manufacture and sell rights to the full range of membrane-based systems for
the production of reduced oxygen environments and associated services as well as the use of patents and trademarks held by Sporting Edge
UK or Vincent.
On
January 24, 2019, Altitude and Sporting Edge UK entered into a Revised Licensing Agreement that grants a license to Altitude to use Sporting
Edge UK’s proprietary technology related to properly engineered, membrane-based designs for simulated altitude training equipment.
The annual license fee under the revised agreement is $1.00 per year. The product line ranges from personal at home use machines to fully
integrated environmental rooms and chambers. Altitude has the licensing rights to use all technology to manufacture the products and
to sell them (directly or through distributors) in the following territories:
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The
Continent of North America, Central America, The Continent of South America.
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Other
territories as may be agreed from time to time, on a temporary or permanent basis.
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All
amounts due under the 2017 license agreement were waived, as were all royalty fees.
NOTE
5 – RELATED PARTY TRANSACTIONS
As
of March 31, 2021, Robert Kanuth, a director of the Company, is owed $14,254 in accrued expenses and $6,141 in notes payable and the
related accrued interest. See Note 7.
As of March 31, 2021, Breunich Holding
Inc., which is controlled by Greg Breunich, the chief executive officer, chief financial officer and chairman of the Company,
is owed $109,328. The payable is non-interest bearing.
NOTE
6 – STOCKHOLDERS’ EQUITY
Preferred
Stock
On
February 5, 2015, the Board of Directors of the Company authorized 5,000,000 shares of preferred stock with no par value. Each share
of the preferred stock is entitled to one vote and is convertible into one share of common stock.
As
of March 31, 2021, and December 31, 2020, the Company has no preferred stock issued and outstanding.
Common
Stock
Altitude
was incorporated on May 18, 2017 under the laws of the state of Wisconsin with 100,000,000 authorized common stock with $0.001 par value.
The shareholders have one vote per share of common stock.
After
the closing of certain Stock Purchase Agreements, in private sale transaction and the Share Exchange Agreement, the Company’s common
stock had no par value and is registered in New York.
On
February 10, 2021, the Company filed amended Articles of Incorporation with the State of New York to amend its authorized shares of common
stock by an additional 530,000,000 whereas the total authorized is a total of 605,000,000 shares of capital stock consisting of (i) 600,000,000
shares of common stock, no par value, and (ii) 5,000,000 shares of preferred stock, no par value.
On
January 1, 2020, the Company was contractually obligated to issue its legal counsel 12,500 shares of common stock for legal work for
January 2020. The common stock of the Company is thinly traded and had a value of $0.0401 per share, therefore the Company recorded the
transaction at $501.
On
February 1, 2020, the Company was contractually obligated to issue its legal counsel 12,500 shares of common stock for legal work for
February 2020. The common stock of the Company is thinly traded and had a value of $0.07 per share, therefore the Company recorded the
transaction at $875.
On
March 1, 2020, the Company was contractually obligated to issue its legal counsel 12,500 shares of common stock for legal work for March
2020. The common stock of the Company is thinly traded and had a value of $0.04 per share, therefore the Company recorded the transaction
at $500.
On
April 1, 2020, the Company was contractually obligated to issue its legal counsel 12,500 shares of common stock for legal work for April
2020. The common stock of the Company is thinly traded and had a value of $0.025 per share, therefore the Company recorded the transaction
at $313.
On
April 7, 2020, Kanuth converted $257,916 of notes and accrued interest into 7,390,144 shares of common stock of the Company, at the current
market price of $0.345.
On
May 1, 2020, the Company was contractually obligated to issue its legal counsel 12,500 shares of common stock for legal work for May
2020. The common stock of the Company is thinly traded and had a value of $0.051 per share, therefore the Company recorded the transaction
at $638.
On
June 1, 2020, the Company was contractually obligated to issue its legal counsel 12,500 shares of common stock for legal work for June
2020. The common stock of the Company is thinly traded and had a value of $0.047 per share, therefore the Company recorded the transaction
at $588.
On
July 1, 2020, the Company was contractually obligated to issue its legal counsel 12,500 shares of common stock for legal work for July
2020. The common stock of the Company is thinly traded and had a value of $0.03 per share, therefore the Company recorded the transaction
at $375.
On
July 9, 2020, Frost converted $158,932 of debt into 7,946,625 shares of common stock. The conversion was at a discount whereas the fair
market value was $198,666. The Company recognized a loss of $39,734 related to the discount.
On
August 1, 2020, the Company was contractually obligated to issue its legal counsel 12,500 shares of common stock for legal work for October
2020. The common stock of the Company is thinly traded and had a value of $0.05 per share, therefore the Company recorded the transaction
at $375.
On
November 1, 2020, the Company was contractually obligated to issue its legal counsel 12,500 shares of common stock for legal work for
November 2020. The common stock of the Company is thinly traded and had a value of $0.043 per share, therefore the Company recorded the
transaction at $538.
On
December 1, 2020, the Company was contractually obligated to issue its legal counsel 12,500 shares of common stock for legal work for
December 2020. The common stock of the Company is thinly traded and had a value of $0.045 per share, therefore the Company recorded the
transaction at $563.
On
February 2, 2021, the Company issued shares of common stock for services as follows: Elizabeth K. Stahl, 40,000; Robin K. Walker, 100,000;
Greg Whyte,1,500,000; and Greg Anthony, 5,000,000.
On
February 8, 2021, Frost exercised 250,000 options at $0.077 per share for $19,250.
As
of March 31, 2021, and December 31, 2020, the Company has 51,500,264 and 36,075,995 shares of no par common stock issued, issuable, and
outstanding.
Stock
Option Plan
On
February 13, 2018, the Company’s shareholders and Board of Directors approved the 2017 Incentive Stock Plan.
On
January 25, 2019, the Company issued 250,000 options to Vincent. The options vest at a rate of 25% every six months after the grant date
and expire upon termination of employment. The exercise price is $0.077. The Black-Scholes calculation valued the options at $15,809,
or $0.06 per share. As of March 31, 2021, $5,912 was amortized. These options expired three months following Vincent’s resignation
because they were not exercised prior to that time.
On
January 25, 2019, the Company issued 250,000 options to Frost. The options vest at a rate of 25% every six months after the grant date
and expire upon termination of employment. The exercise price is $0.077. The Black-Scholes calculation valued the options at $15,809,
or $0.06 per share. On February 8, 2021, Frost exercised the options at $0.077 per share for $19,250.
There
are currently no stock options currently issued and outstanding under the 2017 Plan, as all 250,000 remaining stock options issued and
outstanding were exercised on February 8, 2021.
NOTE
7 – SUBSEQUENT EVENTS
The
Company has evaluated subsequent events through the date the financial statements were issued and filed with the Securities and Exchange
Commission. The Company has determined that there are no other such events that warrant disclosure or recognition in the financial statements,
except as stated herein.
On April 30, 2021, the Company paid Robert Kanuth
$20,000 as a settlement for all liabilities owed to him which totalled $20,395. See Notes 3 and 5.
The
outbreak of the coronavirus (COVID-19) resulted in increased travel restrictions, and shutdown of businesses, which may cause slower
recovery of the economy. We may experience impact from quarantines, market downturns and changes in customer behavior related to pandemic
fears and impact on our workforce if the virus continues to spread. In addition, one or more of our customers, partners, service providers
or suppliers may experience financial distress, delayed or defaults on payment, file for bankruptcy protection, sharp diminishing of
business, or suffer disruptions in their business due to the outbreak. The extent to which the coronavirus impacts our results will depend
on future developments and reactions throughout the world, which are highly uncertain and will include emerging information concerning
the severity of the coronavirus and the actions taken by governments and private businesses to attempt to contain the coronavirus. It
is likely to result in a potential material adverse impact on our business, results of operations and financial condition. Wider-spread
COVID-19 globally could prolong the deterioration in economic conditions and could cause decreases in or delays in advertising spending
and reduce and/or negatively impact our short-term ability to grow our revenues. Any decreased collectability of accounts receivable,
bankruptcy of small and medium businesses, or early termination of agreements due to deterioration in economic conditions could negatively
impact our results of operations.