Company: ARAI
Filing Date: 2025-05-13
Form Type: S-1/A
Source: 0001641172-25-009841
Chunk: 203

Company: Arrive AI Inc.
Filing Date: 2025-05-13
Form: S-1/A
Chunk 203
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 with a stockholder of the Company for the use of a patent. Beginning June 1, 2020, the Company began paying the stockholder a monthly license fee of $10,000. Once revenue from sales, rentals, and leases begins, the Company is required to pay $25.00 per unit sold. If the Company does not sell 400 units per month (or $10,000), the original fixed $10,000 is paid. Accordingly, for the years ended December 31, 2023 and 2022, the Company recorded licensing fee costs in the amount of $120,000 each year.

Although the contract expired in 2023, no new agreement has been executed as of the date of this report. The Company has constructively extended the contract by continuing to pay licensing fees in accordance with the agreement dated May 26, 2020.

The Company rents a warehouse from an officer and shareholder for $2,250 a month on a month-to-month basis.

10. STOCKHOLDERS’ EQUITY

Common Stock

As of December 31, 2023 (on a post-reverse split basis), the Company has 200,000,000 common shares authorized with 28,844,643 shares being issued and outstanding. The par value is $0.0002. No other class of stock has been authorized or is available for issuance.

For the year ended December 31, 2023, the Company issued and cancelled 365,113 and 1,125,000 shares of common stock, respectively, as follows (on a post-reverse split basis):

| a) | 13,334                                                                                      
 restricted shares, subject to a time-based vesting schedule which began July 1, 2021, with  
 shares vesting quarterly (3,333 per quarter), recognized as compensation expense, valued    
 at $0.84 per share (as adjusted for the 1-for-4 reverse split) based on the prevailing fair 
 market value report at the grant date.                                                      |

10. STOCKHOLDERS’ EQUITY (Continued)

Common Stock (Continued)

| b) | 76,360                                                                                           
 shares issued with employees or consultants via stock awards, subject to a performance threshold 
 and time-based vesting schedule, recognized as compensation expense, valued at $11.08 per        
 share (as adjusted for the 1-for-4 reverse split) based on the average price per stock issued    
 to investors for cash in